<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 4, 2000
REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
NORTH AMERICAN VAN LINES, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 4213 52-1840893
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
</TABLE>
------------------------------
5001 U.S. HIGHWAY 30 WEST
P.O. BOX 988
FT. WAYNE, INDIANA 46801-0988
(219) 429-2511
(Address, including ZIP code, and telephone number,
including area code, of Registrant's principal executive offices)
------------------------------
RALPH A. FORD
NORTH AMERICAN VAN LINES, INC.
SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
5001 U.S. HIGHWAY 30 WEST
P.O. BOX 988
FT. WAYNE, INDIANA 46801-0988
(219) 429-2511
(Name, address, including ZIP code, and telephone number,
including area code, of Registrant's agent for service)
------------------------------
WITH COPY TO:
DAVID A. BRITTENHAM, ESQ.
DEBEVOISE & PLIMPTON
875 THIRD AVENUE
NEW YORK, NEW YORK 10022
(212) 909-6000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. / /
If this form is filed to register additional securities of an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering.
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED
OFFERING MAXIMUM
TITLE OF EACH CLASS AMOUNT TO BE PRICE PER AGGREGATE AMOUNT OF
OF SECURITIES TO BE REGISTERED REGISTERED SECURITY(1) OFFERING PRICE REGISTRATION FEE
<S> <C> <C> <C> <C>
13 3/8% Senior Subordinated Notes Due 2009... $150,000,000 100% $150,000,000 $39,600.00
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457 promulgated under the Securities Act of 1933, as
amended.
------------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
OTHER REGISTRANTS
<TABLE>
<CAPTION>
ADDRESS, INCLUDING ZIP
PRIMARY STANDARD CODE, AND TELEPHONE
JURISDICTION OF INDUSTRIAL I.R.S. EMPLOYER NUMBER, INCLUDING AREA
INCORPORATION OR CLASSIFICATION IDENTIFICATION CODE, OF PRINCIPAL
NAME OF REGISTRANT FORMATION NUMBER NUMBER EXECUTIVE OFFICE
- ------------------ ---------------- ---------------- --------------- -------------------------
<S> <C> <C> <C> <C>
Allied Freight Forwarding, Inc. Delaware 4731 36-2405833 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
Allied International N.A., Inc. Delaware 4731 36-2906660 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
Allied Van Lines, Inc. Delaware 4212, 4213, 4225 36-0719320 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
Allied Van Lines Terminal Company Delaware 4213 36-2582535 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
A Relocation Solutions Management Delaware 4731 36-3295067 5001 U.S. Highway 30 West
Company P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
Fleet Insurance Management, Inc. Indiana 6411 35-1471355 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
FrontRunner Worldwide, Inc. Delaware 4731 35-1900598 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
Great Falls North American, Inc. Montana 4214/4213 81-0288174 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
NACAL, Inc. California 4213 95-2368626 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
NAVTRANS International Freight Indiana 4731 35-6296161 5001 U.S. Highway 30 West
Forwarding, Inc. P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
ADDRESS, INCLUDING ZIP
PRIMARY STANDARD CODE, AND TELEPHONE
JURISDICTION OF INDUSTRIAL I.R.S. EMPLOYER NUMBER, INCLUDING AREA
INCORPORATION OR CLASSIFICATION IDENTIFICATION CODE, OF PRINCIPAL
NAME OF REGISTRANT FORMATION NUMBER NUMBER EXECUTIVE OFFICE
- ------------------ ---------------- ---------------- --------------- -------------------------
<S> <C> <C> <C> <C>
North American Distribution Systems, Indiana 4212 35-1115697 5001 U.S. Highway 30 West
Inc. P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
North American Logistics, Ltd. Indiana 4731 13-2890402 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
North American Van Lines of Texas, Texas 4731/4213 75-1440447 5001 U.S. Highway 30 West
Inc. P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
Relocation Management Systems, Inc. Delaware 5045 35-1635373 5001 U.S. Highway 30 West
P.O. Box 988
Ft. Wayne, Indiana
46801-0988
(219) 429-2511
Vanguard Insurance Agency, Inc. Illinois 6411 36-2777624 215 W Diehl Road
Naperville, Illinois
60563
(630) 717-5522
</TABLE>
iii
<PAGE>
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
<PAGE>
SUBJECT TO COMPLETION, DATED FEBRUARY 4, 2000
PROSPECTUS
- -------------
OFFER TO EXCHANGE ALL OUTSTANDING
13 3/8% SENIOR SUBORDINATED NOTES DUE 2009
FOR REGISTERED
13 3/8% SENIOR SUBORDINATED NOTES DUE 2009
THE NEW NOTES:
- The terms of the new notes are identical to the terms of the old notes
except that the new notes are registered under the Securities Act of 1933
and will not contain restrictions on transfer or provisions relating to
additional interest and will contain different administrative terms.
INVESTING IN THE NEW NOTES INVOLVES RISKS. YOU SHOULD CAREFULLY REVIEW THE
RISK FACTORS BEGINNING ON PAGE 11 OF THIS PROSPECTUS.
THE EXCHANGE OFFER:
- Our offer to exchange old notes for new notes will be open until
5:00 p.m., New York City time, on , 2000, unless we extend the
offer.
- No public market currently exists for the notes.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The date of this prospectus is , 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Certain Regulatory Issues................................... iii
Presentation of Financial Information....................... iv
Summary..................................................... 1
Risk Factors................................................ 11
The Exchange Offer.......................................... 22
The Allied Acquisition...................................... 30
Use of Proceeds............................................. 31
Capitalization.............................................. 32
Unaudited Pro Forma Financial Statements.................... 33
Selected Historical Financial Data of NAVL.................. 42
Selected Historical Financial Data of Allied................ 44
Management's Discussion and Analysis of Results of
Operations and Financial Condition........................ 47
Business.................................................... 68
Management.................................................. 84
Ownership of Capital Stock.................................. 96
Certain Relationships and Related Party Transactions........ 98
Description of Other Indebtedness........................... 101
Description of Notes........................................ 104
Certain United States Federal Tax Considerations............ 161
Plan of Distribution........................................ 166
Legal Matters............................................... 166
Experts..................................................... 167
Where You Can Find More Information......................... 168
Index to Financial Statements............................... F-1
</TABLE>
------------------------
The indentures pursuant to which the notes are issued require us to
distribute to the holders of the notes annual reports containing our financial
statements audited by our independent public accountants and quarterly reports
containing unaudited condensed consolidated financial statements for the first
three quarters of each fiscal year. When we refer to "North American Van Lines"
we are referring to North American Van Lines, Inc., the issuer of the notes.
When we refer to ourselves generally, we are referring to North American Van
Lines and its subsidiaries and their predecessors (including subsidiaries
acquired in the Allied acquisition described in the section of this prospectus
called "The Allied Acquisition"), except where the context otherwise requires.
When we refer to "NAVL," we are referring to North American Van Lines and its
subsidiaries prior to the Allied acquisition or, after that acquisition, to our
operations carried out under the northAmerican brand name, as the context
requires. When we refer to "Allied" or to "NFC Moving Services Group," we are
referring to the Allied and Pickfords businesses prior to the Allied acquisition
or, after that acquisition, to our operations carried out under the Allied and
Pickfords brand names, as the context requires.
WE HAVE NOT AUTHORIZED ANYONE TO GIVE YOU ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS ABOUT THE TRANSACTIONS WE DISCUSS IN THIS PROSPECTUS OTHER THAN
THOSE CONTAINED HEREIN. IF YOU ARE GIVEN ANY INFORMATION OR REPRESENTATIONS
ABOUT THESE MATTERS THAT IS NOT DISCUSSED, YOU MUST NOT RELY ON THAT
INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY SECURITIES ANYWHERE OR TO ANYONE WHERE OR TO WHOM WE ARE NOT
PERMITTED TO OFFER OR SELL SECURITIES UNDER APPLICABLE LAW. THE DELIVERY OF THIS
PROSPECTUS OR THE NOTES OFFERED HEREBY DOES NOT, UNDER ANY CIRCUMSTANCES, MEAN
THAT THERE HAS NOT BEEN A CHANGE IN OUR AFFAIRS SINCE THE DATE HEREOF. IT ALSO
DOES NOT MEAN THAT THE INFORMATION IN THIS PROSPECTUS IS CORRECT AFTER THIS
DATE.
ii
<PAGE>
CERTAIN REGULATORY ISSUES
You must comply with all applicable laws and regulations in force in any
jurisdiction in which you purchase, offer or sell the new notes and must obtain
any consent, approval or permission required by you for the purchase, offer or
sale by you of the new notes under the laws and regulations in force in any
jurisdiction to which you are subject or in which you make any purchases, offers
or sales, and we will not have any responsibility for your failure to do so.
THE NOTES MAY NOT BE OFFERED OR SOLD DIRECTLY OR INDIRECTLY TO THE PUBLIC IN
THE REPUBLIC OF FRANCE. NEITHER THIS DOCUMENT, WHICH HAS NOT BEEN SUBMITTED FOR
THE APPROVAL OF THE COMMISSION DE OPERATIONS DE BOURSE, NOR ANY OFFERING
MATERIAL RELATING TO THE NOTES MAY BE RELEASED OR ISSUED TO THE PUBLIC IN THE
REPUBLIC OF FRANCE IN CONNECTION WITH ANY SUCH OFFER.
THE NOTES HAVE NOT BEEN AND WILL NOT BE QUALIFIED FOR SALE UNDER THE
SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA. THE NOTES ARE NOT BEING
OFFERED AND MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN CANADA OR TO
OR FOR THE ACCOUNT OF ANY RESIDENT OF CANADA IN CONTRAVENTION OF THE SECURITIES
LAWS OF ANY PROVINCE OR TERRITORY THEREOF. THIS PROSPECTUS IS NOT, AND UNDER NO
CIRCUMSTANCES IS TO BE CONSTRUED AS, AN ADVERTISEMENT OR A PUBLIC OFFERING OF
THE NOTES IN CANADA.
THE NOTES MAY NOT BE OFFERED IN THE NETHERLANDS OR ELSEWHERE AS PART OF
THEIR INITIAL DISTRIBUTION, TO THE ACCOUNT OF ANY PERSON OR ENTITY OTHER THAN TO
PERSONS WHO, OR ENTITIES WHICH, TRADE OR INVEST IN SECURITIES IN THE CONDUCT OF
A PROFESSION OR BUSINESS WITHIN THE MEANING OF THE SECURITIES TRANSACTIONS
SUPERVISION ACT 1995 (WET TOEZICHT EFFECTENVERKEER 1995) AND ITS IMPLEMENTING
REGULATIONS (WHICH INCLUDE BANKS, INVESTMENT INSTITUTIONS, OTHER INSTITUTIONAL
INVESTORS AND OTHER PARTIES INCLUDING INTER ALIA TREASURIES AND FINANCE
COMPANIES OF LARGE ENTERPRISES THAT REGULARLY, AS AN ANCILLARY ACTIVITY, TRADE
OR INVEST IN SECURITIES).
THE NOTES MAY BE OFFERED AND SOLD IN THE FEDERAL REPUBLIC OF GERMANY ONLY IN
ACCORDANCE WITH THE PROVISIONS OF THE SECURITIES SALES PROSPECTUS ACT OF THE
FEDERAL REPUBLIC OF GERMANY (WERTPAPIER-VERKAUF-SPROSPEKTGESETZ)AND ANY OTHER
APPLICABLE GERMAN LAW. ANY RESALE OF THE NOTES IN THE FEDERAL REPUBLIC OF
GERMANY MAY BE MADE ONLY IN ACCORDANCE WITH THE PROVISIONS OF THE SECURITIES
SALES PROSPECTUS ACT AND ANY OTHER APPLICABLE GERMAN LAW.
THE NOTES MAY NOT BE OFFERED OR SOLD IN OR INTO THE UNITED KINGDOM EXCEPT IN
CIRCUMSTANCES WHICH DO NOT CONSTITUTE AN OFFER TO THE PUBLIC WITHIN THE MEANING
OF THE PUBLIC OFFERS OF SECURITIES REGULATIONS 1995. ALL APPLICABLE PROVISIONS
OF THE FINANCIAL SERVICES ACT 1986 MUST BE COMPLIED WITH IN RESPECT OF ANYTHING
DONE IN RELATION TO THE NOTES IN, FROM OR OTHERWISE INVOLVING THE UNITED
KINGDOM. THE NOTES MAY BE SOLD, AND THIS PROSPECTUS MAY BE ISSUED OR
DISTRIBUTED, ONLY TO A PERSON OF A KIND DESCRIBED IN ARTICLE 11(3) OF THE
FINANCIAL SERVICES ACT 1986 (INVESTMENT ADVERTISEMENTS) (EXEMPTIONS) ORDER 1996
(AS AMENDED) OR TO SUCH OTHER PERSON AS THE NOTES MAY OTHERWISE BE LAWFULLY SOLD
OR THIS PROSPECTUS MAY OTHERWISE BE LAWFULLY ISSUED OR PASSED ON.
THE NOTES HAVE NOT BEEN REGISTERED UNDER SPANISH SECURITIES LAW AND MAY NOT
BE OFFERED OR SOLD WITHIN THE KINGDOM OF SPAIN EXCEPT TO INSTITUTIONAL INVESTORS
UNDER ARTICLE 7.1. A) OF THE ROYAL DECREE 291/1992 DATED MARCH 27, ON ISSUANCES
AND PUBLIC OFFERINGS (AS AMENDED BY ROYAL DECREE 2590/1998) AND OTHER SPANISH
SECURITIES REGULATIONS, ONCE THE PRIOR NOTICE AND THE OTHER DOCUMENTS REFERRED
TO IN ARTICLE 5.2 A) AND B) OF ROYAL DECREE 291/1992 HAVE BEEN REGISTERED BY THE
SPANISH SECURITIES EXCHANGE COMMISSION.
THE NOTES SHALL NOT BE OFFERED WITHIN THE KINGDOM OF SPAIN BY MEANS OF
ADVERTISING ACTIVITIES WHICH MIGHT INFRINGE IN ANY WAY THE REGULATIONS CURRENTLY
IN FORCE ON PUBLIC OFFERINGS AND ISSUES OF SECURITIES AND, IN PARTICULAR, THE
PROSPECTUS AND ANY OTHER MATERIAL INFORMATION RELATING TO THE NOTES SHALL NOT BE
DISTRIBUTED TO SPANISH INVESTORS EXCEPT IN COMPLIANCE WITH THE SPANISH
SECURITIES AND EXCHANGE REGULATIONS.
iii
<PAGE>
INDUSTRY DATA
Industry data used throughout this prospectus are derived from either
(1) research conducted by us based upon data collected by the Department of
Transportation and other unaffiliated third-party sources which we believe to be
reliable, or (2) reports and other information published by the Council of
Logistics Management, the American Moving and Storage Association, an industry
research company and publisher, and Cass ProLogis, an industry research firm.
Although we believe our third-party sources to be reliable, the accuracy and
completeness of the information provided to us is not guaranteed. Neither such
data nor the information included in the industry publications we reference,
including market and competitive position data, have been independently verified
by us. Although such market and competitive position data are inherently
imprecise, based on its understanding of the markets in which we compete,
management believes that such data are generally indicative of our relative
market share and competitive position.
Market research on Allied and northAmerican brand identity described in this
prospectus was performed by the Gallup Organization in 1997. In aided recall
polls, Allied ranked first among van lines. In unaided recall polls, Allied
ranked second to a competitor. northAmerican ranked third in both polls.
PRESENTATION OF FINANCIAL INFORMATION
In this prospectus, except where otherwise indicated, references to
- "U.S. Dollars," "Dollars" or "$" are to the currency of the United States,
and
- "Pounds sterling," "Pounds," or "L" are to the currency of the United
Kingdom.
Except as otherwise stated, in this prospectus, translations of non-dollar
currencies to dollars in the financial statements and the other information
included herein have been calculated, for income statement purposes, on the
basis of average exchange rates over the related periods and, for balance sheet
purposes, the rate in effect on the date thereof. These translations should not
be construed as representations that the non-dollar currency amounts actually
represent such dollar amounts or could be converted into dollars at the rates
indicated or at any other rates.
Solely for your convenience, this prospectus contains translations of
certain financial data of Allied from pounds to dollars. The following table
reflects the exchange rates used as well as other information for your benefit.
We do not represent that the pound amounts shown in this prospectus would have
been converted into Dollars at the quoted exchange rates.
As of , , 2000, the noon buying rate with respect to the pound was
L1.00 = and the closing rate with respect to the pound was L1.00=$ .
<TABLE>
<CAPTION>
FISCAL YEAR ENDED NINE MONTHS
SEPTEMBER 30, ENDED JUNE 30,
------------------------------------ ----------------------
1996 1997 1998 1998 1999
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Exchange rate at the end of period.................... 1.56 1.62 1.70 1.67 1.58
Average exchange rate during period................... 1.54 1.63 1.65 1.65 1.63
High exchange rate during period...................... 1.50 1.62 1.61 1.61 1.58
Low exchange rate during period....................... 1.59 1.69 1.71 1.71 1.72
</TABLE>
iv
<PAGE>
SUMMARY
YOU SHOULD READ THE FOLLOWING SUMMARY TOGETHER WITH THE MORE DETAILED
INFORMATION REGARDING OUR COMPANY, THE SECURITIES BEING SOLD AND OUR
CONSOLIDATED FINANCIAL STATEMENTS AND THE NOTES THERETO APPEARING ELSEWHERE IN
THIS PROSPECTUS.
OUR COMPANY
We are the world's largest global relocation and moving services company and
also the largest logistics services provider among all U.S. van lines. We are a
global network manager of agents, owner/operators and company-owned branches
with locations in 21 countries. Our relocation businesses provide high-quality
packing, warehousing, hauling and delivery for both domestic and international
residential moves. We also provide a broad portfolio of services to commercial
customers, including office and industrial relocations and records management.
Our logistics services segment provides customized solutions to facilitate the
movement of high-value products that require specialized transport and handling
such as electronics, telecommunications and medical equipment and fine art. Our
diversified customer base includes many leading Fortune 500 and FTSE-100
companies, private transferees and the government and military of the United
States and other countries. We recently acquired the Allied and Pickfords moving
services businesses, and believe that the combination of NAVL and Allied will
result in substantial operating synergies due to complementary product
offerings, distribution networks and significant economies of scale, which will
generate incremental cash flow and fund future growth.
THE ALLIED ACQUISITION
On November 19, 1999, we acquired the Allied and Pickfords moving van
businesses from NFC plc. In the acquisition, we acquired capital stock of
various NFC subsidiaries located throughout the world, and the moving
van-related assets of NFC's Canadian operating subsidiary. Concurrently with the
closing of the acquisition, and as part of the financing for the transaction,
North American Van Lines issued and sold the old notes, and borrowed an
aggregate of $325.0 million in term loan borrowings and $65.0 million in
revolving credit borrowings under a new senior secured credit facility. In
addition, as part of that financing, Allied Worldwide, Inc., our parent
(formerly known as NA Holding Corporation), incurred $35.0 million initial
accreted value of unsecured senior discount term loan borrowings. The lenders
under this senior discount loan are expected to exchange the senior discount
loan for senior discount notes of Allied Worldwide prior to February 17, 2000.
Further, also as part of that financing, Allied Worldwide borrowed
$40.0 million in term loan borrowings under an interim loan facility. On
December 1, 1999, Clayton, Dubilier & Rice Fund V Limited Partnership, our
controlling shareholder, and a subsidiary of NFC subscribed for and purchased
additional common stock of Allied Worldwide for $40.0 million in cash. The
proceeds from this stock purchase were used to repay this $40.0 million interim
loan.
CLAYTON, DUBILIER & RICE FUND V LIMITED PARTNERSHIP
The controlling shareholder of our parent, Allied Worldwide, is Clayton,
Dubilier & Rice Fund V Limited Partnership. Clayton, Dubilier & Rice Fund V
Limited Partnership, a Cayman Islands exempted limited partnership formed in
March 1995, is a private investment fund that receives management services from
Clayton, Dubilier & Rice, Inc., a Delaware corporation.
* * *
North American Van Lines' principal executive offices are located at
5001 U.S. Highway 30 West, P.O. Box 988, Ft. Wayne, Indiana 46801-0988. Its
phone number is (219) 429-2511.
1
<PAGE>
SUMMARY OF THE TERMS OF THE EXCHANGE OFFER
On November 19, 1999, we completed a private offering of $150,000,000
principal amount of 13 3/8% senior subordinated notes. In this prospectus, we
refer to (1) the notes sold in that original offering as the old notes, (2) the
notes offered hereby in exchange for the old notes as the new notes, and
(3) the old notes and the new notes together as notes.
<TABLE>
<S> <C>
The Exchange Offer........................ You may exchange old notes for new notes.
Resale of New Notes....................... We believe the new notes that will be issued in this
exchange offer may be resold by most investors without
compliance with the registration and prospectus delivery
provisions of the Securities Act, subject to certain
conditions. You should read the discussion under the
heading "The Exchange Offer" for further information
regarding the exchange offer and resale of the new
notes.
Registration Rights Agreement............. We have undertaken this exchange offer pursuant to the
terms of a registration rights agreement entered into
with the initial purchasers of the old notes. See "The
Exchange Offer" and "Description of Notes--Registration
Rights."
Consequence of Failure to Exchange Old
Notes................................... You will continue to hold old notes that remain subject
to their existing transfer restrictions if:
- you do not tender your old notes or
- you tender your old notes and they are not accepted
for exchange.
Subject to certain limited exceptions, we will have no
obligation to register the old notes after we consummate
the exchange offer. See "The Exchange Offer--Terms of
the Exchange Offer" and "--Consequences of Failure to
Exchange."
Expiration Date........................... The exchange offer will expire at 5:00 p.m., New York
City time, on , 2000, unless we extend it,
in which case "expiration date" means the latest date
and time to which the exchange offer is extended.
Interest on the New Notes................. The new notes will accrue interest at a rate of 13 3/8%
per annum from November 19, 1999, the issue date of the
old notes, or from the most recent date to which
interest has been paid or provided for on the old notes.
No additional interest will be paid on old notes
tendered and accepted for exchange.
Condition to the Exchange Offer........... The exchange offer is subject to certain customary
conditions, which we may waive. See "The Exchange
Offer--Conditions."
</TABLE>
2
<PAGE>
<TABLE>
<S> <C>
Procedures for Tendering Old Notes........ If you wish to accept the exchange offer, you must
submit required documentation and effect a tender of old
notes pursuant to the procedures for book-entry transfer
(or other applicable procedures) all in accordance with
the instructions described in this prospectus and in the
relevant letter of transmittal. See "The Exchange
Offer--Procedures for Tendering," "--Book-Entry
Transfer," and "--Guaranteed Delivery Procedures." Other
procedures may apply with respect to book-entry
transfers. See "The Exchange Offer--Exchanging
Book-Entry Notes."
Guaranteed Delivery Procedures............ If you wish to tender your old notes, but cannot
properly do so prior to the expiration date, you may
tender your old notes according to the guaranteed
delivery procedures set forth in "The Exchange
Offer--Guaranteed Delivery Procedures."
Withdrawal Rights......................... Tenders of old notes may be withdrawn at any time prior
to 5:00 p.m., New York City time, on the expiration
date. To withdraw a tender of old notes, a written or
facsimile transmission notice of withdrawal must be
received by the exchange agent at its address set forth
herein under "The Exchange Offer--Exchange Agent" prior
to 5:00 p.m., New York City time, on the expiration
date.
Acceptance of Old Notes and Delivery of
New Notes............................... Subject to certain conditions, any and all old notes
that are validly tendered in the exchange offer prior to
5:00 p.m., New York City time, on the expiration date
will be accepted for exchange. The new notes issued
pursuant to the exchange offer will be delivered as soon
as practicable following the expiration date. See "The
Exchange Offer--Terms of the Exchange Offer."
Certain U.S. Tax Considerations........... We believe that the exchange of the old notes for new
notes should not constitute a taxable exchange for
U.S. federal income tax purposes. See "Certain United
States Federal Tax Considerations."
Exchange Agent............................ State Street Bank and Trust Company is serving as
exchange agent.
</TABLE>
3
<PAGE>
SUMMARY OF THE TERMS OF THE NEW NOTES
The terms of the new notes are identical to the terms of the old notes
EXCEPT that the new notes:
- are registered under the Securities Act, and therefore will not contain
restrictions on transfer,
- will not contain provisions relating to additional interest, and
- will contain terms of an administrative nature that differ from those of
the old notes.
<TABLE>
<S> <C>
Maturity.................................. December 1, 2009.
Interest.................................. Interest will be payable in cash on June 1 and
December 1 of each year, beginning on June 1, 2000.
Ranking................................... The notes are our senior subordinated debt. Accordingly,
they will rank:
- behind all of our existing and future senior debt;
- equally with all our future subordinated, unsecured
debt that does not expressly provide that it is
subordinated to the notes;
- ahead of any of our future debt that expressly
provides that it is subordinated to the notes; and
- behind all of the liabilities of our existing and
future foreign subsidiaries, and our domestic
subsidiaries that do not guarantee our payment of our
bank indebtedness.
Assuming we had completed the offering and consummated
each of the transactions we describe in the section "The
Allied Acquisition," in each case, on September 25,
1999, the notes would have been subordinated to
approximately $387.3 million of our senior debt. In
addition, the notes are effectively subordinated to all
of the liabilities of our foreign subsidiaries, and our
domestic subsidiaries that do not guarantee our payment
of our bank indebtedness.
Guarantees................................ The notes will be guaranteed by our domestic
subsidiaries that guarantee our payment of our bank
indebtedness.
Optional Redemption....................... On or after December 1, 2004, we may redeem some or all
of the notes at any time at the redemption prices
described in the "Description of Notes--Optional
Redemption."
Prior to December 1, 2002, we may redeem up to 35% of
the notes with proceeds from certain equity offerings at
the redemption prices described in the section
"Description of Notes--Optional Redemption."
Mandatory Offer to Repurchase............. If we sell certain assets or experience specific kinds
of change of control, we must offer to repurchase the
notes at the prices described in the section
"Description of Notes--Change of Control."
Basic Covenants of Indenture.............. The indenture under which the notes are issued contains
covenants that will, among other things, restrict our
ability to:
- borrow money;
</TABLE>
4
<PAGE>
<TABLE>
<S> <C>
- pay dividends on stock or repurchase stock;
- make investments;
- use assets as security in other transactions; and
- sell certain assets or merge with or into other
companies.
See "Description of Notes--Certain Covenants."
</TABLE>
RISK FACTORS
YOU SHOULD REFER TO THE SECTION ENTITLED "RISK FACTORS" FOR AN EXPLANATION
OF CERTAIN RISKS RELATING TO US, OUR BUSINESS, AND AN INVESTMENT IN THE NOTES.
5
<PAGE>
SUMMARY UNAUDITED PRO FORMA CONDENSED FINANCIAL DATA
(DOLLARS IN THOUSANDS)
The summary unaudited pro forma condensed financial data have been derived
from and should be read in conjunction with the unaudited pro forma condensed
financial statements, including the introductory paragraph and related notes.
See "Unaudited Pro Forma Financial Statements." The summary unaudited pro forma
balance sheet data illustrates the effect of (1) the Allied acquisition,
(2) the receipt of the proceeds from the issuance of the notes and initial
borrowings under the new senior credit facility and (3) the payment of all fees
and expenses related to the Allied acquisition and its financing as if they had
occurred on September 25, 1999. The pro forma statement of operations and other
data illustrate the effect of (1) the Allied acquisition, (2) the receipt of
proceeds from the issuance of the notes and initial borrowings under the new
senior credit facility, (3) an increase in stockholders' equity resulting from
the issuance of junior preferred stock, senior discount notes, common stock and
a common stock warrant by Allied Worldwide, and (4) the payment of all fees and
expenses related to the Allied acquisition and its financing as if they had
occurred on December 28, 1997. The pro forma financial data are presented for
informational purposes only and are not necessarily indicative of the actual or
future results had the Allied acquisition and anticipated borrowings been
completed on the dates indicated.
<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED ENDED
DECEMBER 26, 1998 SEPTEMBER 25, 1999
----------------- ------------------
<S> <C> <C>
STATEMENT OF OPERATIONS DATA:
Operating revenues.......................... $2,118,647 $1,581,021
Operating income............................ 44,479 19,431
Net loss.................................... (2,564) (16,045)
OTHER DATA:
EBITDA(1)................................... 115,181 73,859
Depreciation and amortization............... 62,138 45,480
Capital expenditures........................ 31,850 20,306
Ratio of earnings to fixed charges.......... 0.62 0.34
</TABLE>
<TABLE>
<CAPTION>
AS OF
SEPTEMBER 25, 1999
------------------
<S> <C>
BALANCE SHEET DATA:
Cash and cash equivalents................................... $ 1,228
Working capital............................................. 27,461
Fixed assets, net........................................... 171,267
Total assets................................................ 1,089,107
Total debt.................................................. 537,259
Stockholders' equity........................................ 171,294
</TABLE>
- ------------------------
(1) EBITDA for the pro forma periods presented is calculated as described in
note (h) to Unaudited Pro Forma Condensed Income Statement.
EBITDA does not represent and should not be considered as an alternative to
net income or cash flow from operations as determined by generally accepted
accounting principles, and our calculation thereof may not be comparable to
that reported by other companies. We believe that it is widely accepted that
EBITDA provides useful information regarding a company's ability to service
and/or incur indebtedness. EBITDA does not take into account a company's
working capital requirements, debt service requirements and other
commitments and, accordingly, is not necessarily indicative of amounts that
may be available for discretionary use.
6
<PAGE>
SUMMARY HISTORICAL FINANCIAL DATA OF NAVL
We derived the historical financial data for the years ended 1996 and 1997,
for the three-month period ended March 28, 1998 and for the nine-month period
ended December 26, 1998 from the audited financial statements of NAVL or its
predecessor for the periods then ended. The historical financial data of NAVL as
of September 25, 1999, for the nine months ended September 25, 1999 and the six
months ended September 26, 1998 are derived from the unaudited interim financial
statements of NAVL. The unaudited interim financial statements reflect all
adjustments which, in the opinion of management, are necessary for a fair
statement of the financial condition and results of operations as of and for the
periods presented. Operating results for the interim periods are not necessarily
indicative of the results that may be expected for the full year. The
presentation of historical financial data is only a summary and you should read
it together with the historical financial statements and related notes of NAVL
appearing elsewhere in this prospectus.
<TABLE>
<CAPTION>
ANNUAL DATA NINE-MONTH DATA
--------------------------------------------------------- --------------------------------------------
PREDECESSOR(1) NAVL PREDECESSOR NAVL
------------------------------------------ ------------ ------------ -----------------------------
UNAUDITED
NINE-MONTH -----------------------------
PERIOD FROM
THREE-MONTH MARCH 29, THREE-MONTH SIX-MONTH
PERIOD FROM 1998 PERIOD FROM PERIOD FROM
DECEMBER 28, (INCEPTION) DECEMBER 28, MARCH 29, NINE MONTHS
YEAR ENDED YEAR ENDED 1997 THROUGH THROUGH 1997 THROUGH 1998 THROUGH ENDED
DECEMBER 28, DECEMBER 27, MARCH 28, DECEMBER 26, MARCH 28, SEPTEMBER 26, SEPTEMBER 25,
1996 1997 1998 1998 1998 1998 1999
------------ ------------ ------------ ------------ ------------ ------------- -------------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF
OPERATIONS DATA:
Operating revenues... $930.2 $941.5 $207.3 $759.2 $207.3 $521.0 $771.2
Gross profit......... 197.3 199.1 44.9 165.2 44.9 113.9 163.6
Operating income..... 28.1 31.2 (1.3) 11.5 (1.3) 11.0 2.9
Net income/(loss).... 17.5 22.3 (0.7) (1.2) (0.7) 0.7 (6.9)
OTHER DATA:
Net cash provided by
(used for)
operating
activities......... $ 39.7 $ 28.9 $ 10.3 $ (1.6) $ 10.3 $(12.2) $ (1.6)
EBITDA(2)............ 37.9 38.2 6.2 34.0 6.2 26.2 29.9
Depreciation and
amortization....... 12.7 12.5 2.9 22.5 2.9 15.2 21.1
Non-recurring
items(3)........... (2.9) (5.5) 4.6 -- 4.6 -- 5.9
Capital
expenditures....... 7.4 10.6 1.4 5.7 1.4 4.1 5.5
Ratio of earnings to
fixed charges(4)... 5.53 6.61 (0.98) 0.74 (0.98) 0.95 0.16
BALANCE SHEET DATA
(AT THE END OF
PERIOD):
Cash and cash
equivalents........ $ 1.9 $ 2.9 $ 9.2 $ 2.1 $ 9.2 $ 3.7 $ 1.2
Working capital...... 55.8 62.0 63.2 31.4 63.2 33.8 28.5
Fixed assets, net.... 57.1 57.8 56.4 73.6 56.4 78.1 59.1
Total assets......... 287.3 302.3 284.3 392.1 284.3 414.2 412.9
Total debt........... 0.7 0.7 0.7 168.6 0.7 170.0 178.3
Stockholders'
equity............. 86.1 108.1 101.0 63.7 101.0 65.3 56.8
</TABLE>
- ------------------------
(1) See note 1 to Selected Historical Financial Data of NAVL appearing elsewhere
in this prospectus.
(2) EBITDA for the historical periods presented is calculated as described in
note 4 to Selected Historical Financial Data of NAVL.
7
<PAGE>
EBITDA does not represent and should not be considered as an alternative to
net income or cash flow from operations as determined by generally accepted
accounting principles, and our calculation thereof may not be comparable to
that reported by other companies. We believe that it is widely accepted that
EBITDA provides useful information regarding a company's ability to service
and/or incur indebtedness. EBITDA does not take into account a company's
working capital requirements, debt service requirements and other
commitments and, accordingly, is not necessarily indicative of amounts that
may be available for discretionary use.
(3) See note 3 to Selected Historical Financial Data of NAVL appearing elsewhere
in this prospectus.
(4) The ratio of earnings to fixed charges for the years ended December 28, 1996
and December 27, 1997, for the three-month period ended March 28, 1998 and
for the nine-month period ended December 26, 1998 includes non-cancellable
lease expenses as the basis of determining the interest component of
operating leases. The ratio of earnings to fixed charges for the six-month
period ended September 26, 1998 and for the nine months ended September 25,
1999 include cancellable and non-cancellable lease expenses as the basis of
determining the interest component of operating leases.
8
<PAGE>
SUMMARY HISTORICAL FINANCIAL DATA OF ALLIED
We derived the historical financial data for the twelve months ended
September 30, 1996 through 1998 from the audited combined financial statements
of Allied for the fiscal years ended September 30, 1996 through 1998, all of
which are presented in Pounds and in accordance with accounting principles
generally accepted in the United Kingdom (U.K. GAAP). The historical financial
data of Allied as of and for the nine months ended June 30, 1998 and June 30,
1999 are derived from the unaudited interim combined financial statements of
Allied. The unaudited interim combined financial statements reflect all
adjustments, consisting only of normal, recurring adjustments, which, in the
opinion of Allied's management, are necessary for a fair statement of the
combined financial condition and results of operations for the periods
presented. Operating results for the interim periods are not necessarily
indicative of the results that may be expected for the full year. The
presentation of historical financial data is only a summary and you should read
it together with the historical financial statements and related notes of Allied
appearing elsewhere in this prospectus.
<TABLE>
<CAPTION>
ANNUAL DATA NINE-MONTH DATA
---------------------------------------------- -------------------------
TWELVE MONTHS TWELVE MONTHS TWELVE MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, JUNE 30, JUNE 30,
1996 1997 1998 1998 1999
U.K. GAAP(1) ------------- -------------- ------------- ----------- -----------
(IN MILLIONS)
UNAUDITED
---------
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Operating revenues................ L 658.1 L 680.7 L 698.3 L486.3 L496.8
Operating profit before
exceptional items(2)............ 15.7 19.0 24.5 12.7 12.4
Profit for the financial period... 8.9 11.8 20.0 10.9 9.6
OTHER DATA:
Net cash provided by operations... L 17.5 L 33.6 L 36.3 L 23.8 L 17.0
EBITDA(3)......................... 28.4 31.7 37.1 22.1 22.6
Depreciation...................... 8.3 8.4 9.0 6.9 7.4
Exceptional items(4).............. (4.0) 0.0 (1.7) (1.0) (1.0)
Capital expenditures.............. 9.9 12.2 15.0 11.5 9.1
Ratio of earnings to fixed
charges......................... 4.45 3.94 7.46 5.22 3.83
BALANCE SHEET DATA (AT THE END OF
PERIOD):
Cash.............................. L -- L 13.9 L 18.0 L 19.4 L 25.9
Working capital................... -- 31.9 34.2 24.2 39.7
Fixed assets, net................. -- 45.4 48.8 48.1 51.4
Total assets...................... -- 266.3 281.9 193.0 232.5
Intercompany payable to NFC,
net............................. -- 47.8 37.8 13.6 168.9
Stockholders' equity.............. -- 32.3 49.2 63.6 (63.0)
U.S. GAAP DATA(1)(5):
Operating revenues................ $1,013.5 $1,109.5 $1,152.2 $802.4 $809.8
EBITDA(3)......................... 45.9 54.1 64.7 38.8 38.8
Stockholders' equity.............. -- 87.3 119.9 142.6 (68.1)
</TABLE>
- --------------------------
(1) The combined financial statements of Allied for the periods presented have
been prepared in accordance with U.K. GAAP, which differs in certain
significant respects from generally accepted accounting principles in the
United States (U.S. GAAP). See note 22 of Notes to the Combined Financial
Statements of Allied and note 4 of Notes to the Condensed Combined Financial
Statements of Allied included elsewhere in this prospectus. In anticipation
of the Allied acquisition, the historical financial statements were prepared
to show the performance of moving services businesses and assets of Allied
separate from the operations of its parent, NFC. These historical financial
statements were prepared for the three years ended September 30, 1998, as if
the moving services business had been in
9
<PAGE>
existence from October 1, 1995. Financial information for Allied operations
is not available for periods prior to October 1, 1995.
(2) Includes operating exceptional items.
(3) EBITDA for the historical periods presented is calculated as described in
note 3 to Selected Historical Financial Data of Allied.
EBITDA does not represent and should not be considered as an alternative to
net income or cash flow from operations as determined by generally accepted
accounting principles, and our calculation thereof may not be comparable to
that reported by other companies. We believe that it is widely accepted that
EBITDA provides useful information regarding a company's ability to service
and/or incur indebtedness. EBITDA does not take into account a company's
working capital requirements, debt service requirements and other
commitments and, accordingly, is not necessarily indicative of amounts that
may be available for discretionary use.
(4) Includes profit/loss on disposal of properties, loss on disposal of
operations and operating exceptional items.
(5) See note 3 to Selected Historical Financial Data of Allied.
10
<PAGE>
RISK FACTORS
YOU SHOULD READ AND CONSIDER CAREFULLY EACH OF THE FOLLOWING FACTORS, AS
WELL AS THE OTHER INFORMATION CONTAINED IN OR INCORPORATED BY REFERENCE INTO
THIS PROSPECTUS, BEFORE MAKING A DECISION TO INVEST IN THE NOTES.
IF ANY OF THE FOLLOWING RISKS ACTUALLY OCCUR, OUR BUSINESS, FINANCIAL
CONDITION, RESULTS OF OPERATIONS OR ABILITY TO PAY PRINCIPAL OR INTEREST ON THE
NOTES COULD BE MATERIALLY ADVERSELY AFFECTED. IN THAT EVENT, YOU MAY LOSE ALL OR
PART OF YOUR INVESTMENT.
RISKS RELATING TO THE NOTES
IF YOU DO NOT PROPERLY TENDER YOUR OLD NOTES, YOU WILL CONTINUE TO HOLD
UNREGISTERED OLD NOTES AND YOUR ABILITY TO TRANSFER OLD NOTES WILL BE ADVERSELY
AFFECTED.
We will only issue new notes in exchange for old notes that are timely and
properly tendered. Therefore, you should allow sufficient time to ensure timely
delivery of the old notes and you should carefully follow the instructions on
how to tender your old notes. Neither we nor the exchange agent are required to
tell you of any defects or irregularities with respect to your tender of the old
notes. If you do not exchange your old notes for new notes pursuant to the
exchange offer, the old notes you hold will continue to be subject to the
existing transfer restrictions. In general, the old notes may not be offered or
sold, unless registered under the Securities Act, or exempt from registration
under the Securities Act and applicable state securities laws. We do not
anticipate that we will register old notes under the Securities Act.
After the exchange offer is consummated, if you continue to hold any old
notes, you may have trouble selling them because there will be fewer old notes
of such series outstanding. In addition, if a large number of old notes are not
tendered or are tendered improperly, the limited amount of new notes that would
be issued and outstanding after we consummate the exchange offer could lower the
market price of such new notes.
OUR SUBSTANTIAL INDEBTEDNESS AND OUR ABILITY TO INCUR MORE INDEBTEDNESS COULD
PREVENT US FROM FULFILLING OUR OBLIGATIONS UNDER THE NOTES.
We have significant indebtedness. On September 25, 1999, after giving pro
forma effect to the Allied acquisition and its financing (see "The Allied
Acquisition"), including the issuance of the notes, we would have had total
indebtedness, consisting of indebtedness for borrowed money and capital leases
and excluding letters of credit, of approximately $537.3 million (of which
$150.0 million would have consisted of the notes and the balance would have
consisted of borrowings of $385.4 million under the new senior credit facility
and other debt of $1.9 million (see "Capitalization")) and stockholders' equity
of approximately $171.3 million. In addition after giving pro forma effect to
these transactions, our ratio of earnings to fixed charges for the twelve months
ended December 26, 1998 would have been 0.62 to 1. The indenture pursuant to
which the notes are issued, the agreements governing Allied Worldwide's $35.0
million of senior discount debt and the agreements governing the new senior
credit facility limit, but do not prohibit, our incurrence of additional
indebtedness. A substantial level of debt may make it more difficult for us to
repay you.
Our indebtedness will have important consequences to you. For example, it
could:
- make it more difficult for us to make payments on the notes;
- limit our ability to borrow additional money for working capital, capital
expenditures, debt service requirements or other purposes;
- require us to use a substantial portion of our future cash flow from
operations to pay principal and interest on our indebtedness and other
obligations, thereby reducing the availability of this cash
11
<PAGE>
flow to fund working capital, capital expenditures, debt service
requirements or other general corporate expenditures;
- limit our flexibility in planning for, or reacting to changes in, our
business and restrict our ability to take advantage of future business
opportunities;
- place us at a competitive disadvantage to those competitors with less
indebtedness; and
- limit our ability to react to changing market conditions, changes in our
industry and economic downturns.
WE MAY NOT HAVE ENOUGH CASH AVAILABLE TO SERVICE OUR INDEBTEDNESS.
Our ability to pay interest on the notes and meet our other debt service
obligations will depend on our future performance, which in turn depends on
successful implementation of our strategy and on financial, competitive,
regulatory, technical and other factors, many of which are beyond our control.
If we cannot generate sufficient cash flow from operations or meet our debt
service requirements, we may be required to refinance our indebtedness,
including the notes. Our ability to obtain such financing will depend on our
financial condition at the time, the restrictions in the agreements governing
our indebtedness and other factors, including general market and economic
conditions. If such refinancing were not possible, we could be forced to dispose
of assets at unfavorable prices. In addition, we could default on our debt
obligations, including our obligations to make payments on the notes. See
"Management's Discussion and Analysis of Results of Operations and Financial
Condition--Financial Condition--Pro Forma Liquidity and Capital Resources."
OUR DEBT AGREEMENTS IMPOSE OPERATING AND FINANCIAL RESTRICTIONS ON US THAT MAY
PREVENT US FROM CAPITALIZING ON BUSINESS OPPORTUNITIES.
The indenture pursuant to which the notes are issued, the agreements
governing Allied Worldwide's $35.0 million of senior discount debt and the
agreements governing the new senior credit facility impose significant operating
and financial restrictions on us. The terms of any other financings we may
obtain may do so as well. These restrictions may substantially limit or prohibit
us from taking various actions, including incurring additional debt, making
investments, paying dividends to our shareholders, creating liens, selling
assets, engaging in mergers and consolidations, repurchasing or redeeming
capital stock and capitalizing on business opportunities.
Failure to comply with the covenants and restrictions in the indenture or
other financing agreements could trigger defaults under such agreements even if
we are able to make payments on our debt. These defaults could result in a
default on the notes and could delay or preclude payment of principal of or
interest on the notes.
THE NOTES WILL BE SUBORDINATED TO OUR SENIOR DEBT, INCLUDING THE NEW SENIOR
CREDIT FACILITY.
The notes will be subordinated in right of payment to all of North American
Van Lines' current and future senior indebtedness. North American Van Lines has
senior indebtedness, including the new senior credit facility, and may incur
additional senior indebtedness in the future. If we default on our senior
indebtedness or, in the event of bankruptcy, liquidation or reorganization, the
holders of our senior debt will be entitled to be paid in full in cash before
any payment may be made with respect to the notes. Also, in the event of
bankruptcy, liquidation or reorganization, holders of the notes will participate
ratably with all holders of our subordinated indebtedness that is deemed to be
of the same class as the notes, and potentially with all our other general
creditors, in distributions of our remaining assets. In these events, we cannot
assure you that there would be sufficient assets to pay you in full or at all.
See "Description of Notes--Ranking."
12
<PAGE>
As of September 25, 1999, after giving pro forma effect to the Allied
acquisition and its financing (see "The Allied Acquisition"), including the
issuance of the notes, we would have had senior indebtedness for borrowed money
and capital leases (including borrowings under the new senior credit facility)
of approximately $387.3 million, and approximately $89.6 million would have been
available for additional borrowing under the new senior credit facility.
THE NOTES WILL BE EFFECTIVELY SUBORDINATED TO OBLIGATIONS OF OUR FOREIGN
SUBSIDIARIES AND ANY DOMESTIC SUBSIDIARY THAT DOES NOT GUARANTEE THE NOTES.
North American Van Lines conducts a substantial portion of its business
through direct or indirect subsidiaries. Only those domestic subsidiaries that
guarantee its payment of its bank indebtedness will guarantee payment of the
notes. Creditors of North American Van Lines' other subsidiaries (including
holders of indebtedness and trade creditors) would generally be entitled to
payment of their claims from the assets of the affected subsidiaries before any
funds were made available for distribution to North American Van Lines. The
indenture permits the incurrence of additional indebtedness by North American
Van Lines and its subsidiaries and will permit investments by North American Van
Lines in its subsidiaries. In the event of a bankruptcy, liquidation or
reorganization of a subsidiary that does not guarantee the notes, holders of any
such subsidiary's indebtedness will have a claim to the assets of the subsidiary
that is prior to North American Van Lines' interest in those assets.
As of September 25, 1999, after giving pro forma effect to the Allied
acquisition, the issuance of the notes and the borrowings under the new senior
credit facility, those North American Van Lines subsidiaries that will not
guarantee the notes upon the closing of the Allied acquisition would have had
substantial liabilities including indebtedness for borrowed money, trade
payables and other balance sheet liabilities. If any subsidiary indebtedness
were to be accelerated, we cannot assure you that the assets of such subsidiary
would be sufficient to pay that indebtedness or that the assets of North
American Van Lines and its subsidiaries that then guarantee the notes would be
sufficient to repay in full North American Van Lines' indebtedness, including
the notes.
OUR ACCESS TO THE CASH FLOW OF OUR SUBSIDIARIES IS RESTRICTED.
Although a substantial portion of North American Van Lines' business is
conducted through its subsidiaries, only those domestic subsidiaries that
guarantee its payment of its bank indebtedness will guarantee the notes. None of
our subsidiaries will have any other obligation, contingent or otherwise, to
make any funds available to us for payment of the notes. Accordingly, our
ability to pay the notes is dependent upon the earnings of these subsidiaries
and the distribution of funds from these subsidiaries to North American Van
Lines.
These subsidiaries are permitted under the indenture to incur substantial
additional indebtedness that may severely restrict or prohibit the making of
distributions, the payment of dividends and the making of loans by such
subsidiaries to North American Van Lines. Applicable law of the jurisdictions in
which these subsidiaries are organized or contractual or other obligations to
which they are subject may limit their ability to pay dividends or make or repay
on intercompany loans, including any that may be made with the proceeds of the
offering of the notes. In particular, our insurance subsidiaries are subject to
extensive regulation in their respective jurisdictions that limit loans, the
transfer of assets, or payments by such insurance subsidiaries to their
affiliates, including North American Van Lines. Such regulations could limit
North American Van Lines' ability to draw on these insurance subsidiaries'
assets to repay its indebtedness, including the notes. See "Business--Government
Regulation." In addition, we are currently developing an e-commerce business
strategy but are still in the process of determining the structure and scope of
this business. We cannot assure you that the development of this business will
not occur through a spin-off, other divestiture or other manner, such as a joint
venture, that may make the profits generated by this business, if any,
unavailable, or available only to a limited extent, to North American Van Lines
to make payments on the notes.
13
<PAGE>
Additionally, those subsidiaries that are not guaranteeing the notes may
generate substantial revenue that will not be available to pay the notes unless
and until such revenue is distributed to North American Van Lines or an
intermediate parent company that does guarantee the notes. Furthermore, the
payment of interest and principal on intercompany loans and advances as well as
the payment of dividends by North American Van Lines' subsidiaries may be
subject to taxes.
We cannot assure you that our operations will generate sufficient cash flow
to support payment of the notes, or that dividends, distributions, loans or
other funds will be available from North American Van Lines' subsidiaries to
fund these payments.
WE MAY NOT BE ABLE TO FINANCE A CHANGE OF CONTROL OFFER REQUIRED BY THE
INDENTURE.
If we undergo certain types of changes of control, we may be required to
offer to repurchase all outstanding notes. However, we cannot assure you that
sufficient funds will be available at the time of any of these occurrences to
make any required repurchases of notes tendered or that restrictions in the new
senior credit facility or the debt agreements of Allied Worldwide will allow us
to make such required repurchases. Notwithstanding these provisions, we could
enter into certain transactions, including certain recapitalizations, that would
not constitute a change of control as defined in the indenture but would
increase the amount of debt outstanding at such time. See "Description of
Notes--Change of Control."
THERE WILL BE NO PUBLIC TRADING MARKET FOR THE NOTES, AND YOUR ABILITY TO
TRANSFER THEM IS LIMITED.
No active trading market currently exists for the notes. If these securities
are traded after we issue them, they may trade at a discount from their initial
offering price, depending on prevailing interest rates, the market for similar
securities and other factors, including general economic conditions and our
financial condition, performance and prospects, as well as recommendations of
securities analysts. We cannot assure you that an active trading market for the
notes will develop or, if one does develop, that it will be sustained. The
liquidity of, and trading market for, the notes may also be impacted by declines
in the market for high yield securities generally. Such a decline may materially
and adversely affect any liquidity and trading of the notes independent of our
financial performance and prospects.
UNDER CERTAIN CIRCUMSTANCES, A COURT COULD AVOID OR SUBORDINATE THE AMOUNTS
OWING UNDER THE GUARANTEES AND THE NOTES TO OUR PRESENTLY EXISTING AND FUTURE
INDEBTEDNESS, AND COULD TAKE OTHER ACTIONS DETRIMENTAL TO YOUR INTERESTS AS A
NOTE HOLDER.
The incurrence of indebtedness by North American Van Lines and any of its
subsidiaries that guarantee the notes, such as the notes and the note
guarantees, may be subject to review under federal or state fraudulent transfer
laws in the event that North American Van Lines or any note guarantor is the
subject of a bankruptcy filing or lawsuit commenced by or on behalf of unpaid
creditors of North American Van Lines or such note guarantor. Under such laws,
if a court in a lawsuit by a creditor or a representative of creditors of North
American Van Lines or any note guarantor, such as a trustee in bankruptcy, were
to find that, at the time North American Van Lines or such note guarantor
incurred indebtedness, including indebtedness under the notes or the relevant
note guarantee, North American Van Lines or such note guarantor
(1) was insolvent or rendered insolvent by reason of such incurrence,
(2) was engaged in a business or transaction for which its remaining assets
constituted an unreasonably small amount of capital,
(3) intended to incur, or believed that it would incur, debts beyond its
ability to pay as they matured, or
(4) intended to hinder, delay or defraud current or future creditors
14
<PAGE>
and, in the case of clauses (1), (2) and (3), that North American Van Lines or
such note guarantor did not receive reasonably equivalent value or fair
consideration for incurring such indebtedness, such court could avoid or
subordinate the amounts owing under the notes or the relevant note guarantee to
presently existing and future indebtedness of North American Van Lines or such
note guarantor and take other actions detrimental to holders of the notes.
If a court were to find that North American Van Lines or such note guarantor
came within any of clauses (1) through (4) above, North American Van Lines or
such note guarantor, or its creditors or the trustee in bankruptcy, could seek
to avoid the grant of security interests to the lenders under the senior credit
facility. This would result in an event of default with respect to indebtedness
incurred under the senior credit facility which, under the terms of such
indebtedness (subject to applicable law), would allow the lenders to terminate
their obligations thereunder and to accelerate payment of such indebtedness.
The measure of insolvency for purposes of the foregoing will vary depending
upon the law of the jurisdiction which is being applied. Generally, however, a
company would be considered insolvent for purposes of the foregoing if, at the
time it incurred the indebtedness,
(1) the sum of such company's debts including contingent liabilities is
greater than all such company's property at a fair valuation,
(2) the present fair saleable value of such company's assets is less than
the amount that will be required to pay its probable liability on its
existing debts and liabilities (including contingent liabilities) as they
become absolute and matured or
(3) the company incurred obligations beyond its ability to pay as such
obligations become due.
There can be no assurance as to what standards a court would use to determine
whether North American Van Lines or a note guarantor was solvent at the relevant
time, or whether, whatever standards were to be used, the notes or the note
guarantees would not be avoided or further subordinated on another of the
grounds set forth above. Moreover, any solvency analysis conducted in connection
with the Allied acquisition and its financing would not be binding on a court
and there can be no assurance that a court would not determine that North
American Van Lines or a note guarantor was insolvent at the time of or after
giving effect to the Allied acquisition, the offering of the notes or the
borrowings under the senior credit facility.
Management believes that at the time the indebtedness constituting the notes
and the note guarantees were incurred initially by North American Van Lines and
the note guarantors, each of North American Van Lines and the note guarantors
(1) was
(a) neither insolvent nor rendered insolvent by reason of such
occurrence,
(b) in possession of sufficient capital to run its respective business
effectively and
(c) incurring debts within its respective ability to pay as the same
mature or become due and
(2) will have sufficient assets to satisfy any probable money judgment
against it in any pending action.
In reaching the foregoing conclusions, management has relied upon its analyses
of internal cash flow projections and estimated values of assets and liabilities
of North American Van Lines and the note guarantors. We cannot assure you,
however, that a court passing on such questions would reach the same
conclusions.
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RISKS RELATING TO OUR COMPANY
WE HAVE A HISTORY OF NET LOSSES, AND MAY NOT BE PROFITABLE IN THE FUTURE.
Since the acquisition of NAVL by Clayton, Dubilier & Rice Fund V Limited
Partnership in March of 1998, we have had significant interest expense.
Consequently, NAVL reported a net loss of $6.9 million for the nine months ended
September 25, 1999, and $1.2 million for the nine-month period ended
December 26, 1998.
After giving effect to the Allied acquisition and the initial borrowings
under the new senior credit facility, we continue to have a substantial amount
of interest expense. We also expect that continued development of our business
will require significant additional capital expenditures. We expect that these
continued expenses will result in future net losses and affect our ability to
reduce our leverage.
WE MAY EXPERIENCE DIFFICULTY INTEGRATING THE NEWLY ACQUIRED ALLIED BUSINESSES.
ANY SUCH DIFFICULTIES COULD ADVERSELY AFFECT OUR OPERATIONS.
The integration and consolidation of Allied will require substantial
management, financial and other resources. While we believe that we have
sufficient resources to manage this effort, the Allied acquisition involves a
number of significant risks, including diversion of management's attention, the
inability to integrate successfully Allied's operations, difficulties in
assimilating the technologies, services and products of Allied, the inability to
retain key management employees of Allied and unanticipated events or
circumstances, some or all of which could have a material adverse effect on our
business, financial condition or results of operations. Moreover, we cannot
provide assurances as to the timing or the extent of the anticipated benefits of
the Allied acquisition. Our inability to integrate and manage Allied
successfully, or to achieve a substantial portion of the anticipated benefits
within the time frame anticipated by management, could have a material adverse
effect on our business, financial condition or results of operations.
WE MAY BE UNABLE TO ACHIEVE ESTIMATED COST SAVINGS.
Our business plan anticipates that we will have the ability to achieve
substantial cost savings through (1) our Fast Forward program, (2) synergies
arising as a result of the combination of NAVL and Allied, and (3) our ability
to operate our business with lower costs than the overhead allocated by former
owners. See "Business--Business and Growth Strategy." These estimated cost
savings are based upon analyses completed by members of our management. Such
estimates and analyses necessarily involve assumptions as to future events,
including general business and industry conditions, competitive factors, local
labor markets and labor productivity, many of which are beyond our control and
may not materialize. While we believe these analyses and underlying assumptions
to be reasonable, there could be unforeseen factors that may offset the
estimated cost savings or other components of our business plan in whole or in
part. As a result, our actual cost savings may vary considerably in amount
and/or character, or be considerably delayed, compared to the estimates
described in this prospectus. In addition, we expect to incur certain
significant costs in connection with implementing the above savings (see
"Management's Discussion and Analysis of Results of Operations and Financial
Condition--Financial Condition--Liquidity and Capital Resources").
WE MAY NOT BE ABLE TO RECRUIT AND RETAIN A SUFFICIENT NUMBER OF AGENTS,
REPRESENTATIVES OR OWNER/OPERATORS TO CARRY OUT OUR GROWTH PLANS.
We rely on the services of agents to market our services and to act as
intermediaries with customers, and on agents and owner/operators to provide a
significant portion of our packing, warehousing and hauling services. Although
we believe our relationships with our agents and owner/operators are good, we
have had some difficulty in obtaining or retaining qualified owner/operators in
the past due to other available employment choices with more earnings potential
or individuals' desire to pursue a lifestyle that
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is not "on-the-road." In April of 1999, the initial term of the agency contracts
between Allied and U.S. agents representing approximately 52.1% of Allied's 1998
revenue booked by U.S. domestic agents expired. Although the majority of these
agents have signed eighteen-month extensions, the contracts for the remainder of
these agents (representing 8.0% of Allied's 1998 revenue booked by U.S. domestic
agents), although still in effect, may be terminated by these agents on three
months' notice. Although we have experienced relatively low agent turnover in
the past, we cannot assure you that these contracts will be renewed on favorable
terms or at all. In addition, NAVL's fourteenth largest agent terminated its
relationship with us on January 30, 2000.
We cannot assure you that we will be successful in retaining our agents or
owner/operators or that agents or owner/operators that terminate their contracts
can be replaced by equally qualified personnel. A loss in the number of
qualified drivers could lead to an increased frequency of accidents, potential
claims exposure and, indirectly, insurance costs. Because agents have the
primary relationship with customers, we expect that some customers would
terminate their relationship with us were the agent that handles such customers'
business to terminate its relationship with us.
WE HAVE NO CONTROL OVER THIRD PARTIES ON WHOM WE RELY FOR THE PROVISION OF
CERTAIN ASPECTS OF OUR SERVICES AND IF THEY OR THEIR FACILITIES DO NOT PERFORM
OR FUNCTION ADEQUATELY, OUR OPERATIONS MAY BE IMPAIRED.
We rely on third parties for certain aspects of our services, including
warehousing and the provisioning of some distribution facilities and cargo
space. If these third parties or their facilities do not perform or function
adequately, our operations may be impaired. We are also subject to other risks
outside our control, such as the risk to customer goods from fire, power loss,
flooding and other natural disasters.
WE LICENSE A SIGNIFICANT PORTION OF OUR INFORMATION TECHNOLOGY SYSTEMS FROM A
THIRD PARTY. THEREFORE, OUR RIGHT TO USE THESE SYSTEMS MAY BE LIMITED.
Our range of logistics services is supported by an integrated information
system that links order processing, inventory management and product tracking
with physical distribution features. Although we developed one of these systems
internally, we transferred ownership of it to, and currently license it from, a
third party. In addition, other information technology systems that are crucial
to our business are licensed from third parties. These licenses set forth the
terms of our continued use of this software and impose restrictions on our
ability to use this software in certain business segments. See
"Business--Information Technology."
WE MAY HAVE DIFFICULTY INTEGRATING OR ENHANCING SOPHISTICATED LOGISTICS
INFORMATION SYSTEMS. ANY SUCH DIFFICULTIES COULD DELAY OR DISRUPT OUR ABILITY TO
SERVICE OUR CUSTOMERS OR IMPAIR OUR COMPETITIVENESS.
Sophisticated information systems are vital to our growth and our ability to
manage and monitor the flow of goods we are transporting and to provide
attractive logistics solutions services, which depend on technologically
advanced systems. As these systems are evolving rapidly, we will need to
continually enhance them. We may encounter difficulties in enhancing these
systems or in integrating new technology into our systems in a timely and
cost-effective manner. Such difficulties could have a material adverse effect on
our ability to operate efficiently and to provide competitive customer service.
To compete effectively, we must anticipate and adapt to technological
changes and offer, on a timely basis, competitively priced services that meet
evolving industry standards and customer preferences. We may choose new
technologies that later prove to be inadequate, or may be forced to implement
new technologies at substantial cost to remain competitive. In addition,
competitors may implement new technologies before we do, allowing such
competitors to provide lower priced or enhanced services and superior quality
compared to those we provide. This development could have a material adverse
effect on our ability to compete.
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OUR OWNER/OPERATORS ARE CURRENTLY NOT CONSIDERED TO BE EMPLOYEES BY TAXING AND
OTHER REGULATORY AUTHORITIES. SHOULD THESE AUTHORITIES CHANGE THEIR POSITION AND
CONSIDER OUR OWNER/OPERATORS TO BE OUR EMPLOYEES, OUR COSTS RELATED TO OUR TAX,
UNEMPLOYMENT COMPENSATION AND WORKERS' COMPENSATION PAYMENTS COULD INCREASE
SIGNIFICANTLY.
From time to time, certain parties, including the Internal Revenue Service
and state authorities, have sought to assert that owner/operators in the
trucking industry are employees rather than independent contractors. At times,
these parties have been successful in making these assertions. We consider all
of our owner/operators to be independent contractors. We cannot assure you that
tax authorities will not successfully challenge this position, that
interpretations supporting our position will not change, or that federal and
state tax or other applicable laws will not change. If owner/operators were
deemed to be employees, our costs related to tax, unemployment compensation, and
workers' compensation could increase significantly. In addition, such changes
may be applied retroactively, and if so we may be required to pay additional
amounts to compensate for prior periods.
WE ARE DEPENDENT ON OUR HIGHLY TRAINED EXECUTIVE OFFICERS AND EMPLOYEES. ANY
DIFFICULTY IN MAINTAINING OUR CURRENT EMPLOYEES OR IN HIRING SIMILAR EMPLOYEES
WOULD ADVERSELY AFFECT OUR ABILITY TO OPERATE OUR BUSINESS.
Our operations are managed by a small number of key executive officers. The
loss of any of these individuals could have a material adverse effect on us. In
addition, our success depends on our ability to continue to attract, recruit and
retain sufficient qualified personnel in an increasingly technology-based
industry as we grow. Competition for qualified personnel is intense. We cannot
assure you that we will be able to retain senior management, integrate new
managers, or recruit qualified personnel in the future.
WE ARE CONTROLLED BY PARTIES WHOSE INTERESTS MAY NOT BE ALIGNED WITH YOURS.
Clayton, Dubilier & Rice Fund V Limited Partnership indirectly holds
approximately 72.3% of our capital stock on an undiluted basis and 62.4% on a
fully diluted basis. Such ownership may present conflicts of interest between
these owners and you if we encounter financial difficulties or if these owners
cause us to pursue transactions that could enhance their equity investment while
involving risks to your interests.
WE MAY BE ADVERSELY AFFECTED BY YEAR 2000 ISSUES.
Computer programs that have time-sensitive software may recognize a date
using "00" as the year 1900 rather than the year 2000, which could result in
miscalculations or a major system failure. We cannot assure you that our systems
will continue to function adequately during the year 2000 or thereafter. A
failure of our computer or other systems could have a material adverse effect on
us. We cannot assure you either that the systems of our vendors, suppliers,
agents, representatives and customers are Year 2000 compliant. Any failure of
their computer systems could materially and adversely affect our ability to
operate our business and could impose significant costs on us. See "Management's
Discussion and Analysis of Results of Operations and Financial Condition--Impact
of Year 2000."
RISKS RELATING TO OUR INDUSTRY
POTENTIAL LIABILITY ASSOCIATED WITH ACCIDENTS IN THE TRUCKING TRANSPORTATION
INDUSTRY IS SEVERE AND OCCURRENCES ARE UNPREDICTABLE. IN ADDITION, AN INCREASE
IN LIABILITY, PROPERTY OR CASUALTY INSURANCE PREMIUMS COULD CAUSE US TO INCUR
SIGNIFICANT COSTS.
We use the services of a significant number of drivers in connection with
our pick-up and delivery operations, and from time to time such drivers are
involved in accidents. Potential liability associated with accidents in the
trucking industry may be severe and occurrences are unpredictable. We are also
subject to substantial exposure due to workers' compensation and cargo claims
expense, whether or not injuries or damage occur in the context of a traffic
accident.
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We carry insurance to cover liability and workers' compensation claims. We
cannot assure you, however, that our insurance will be adequate to cover all of
our liabilities. To the extent we were to experience a material increase in the
frequency or severity of accidents, cargo claims or workers' compensation
claims, or in the unfavorable resolution of existing claims, we might be
required to incur substantial costs to cover these claims. In addition, our
results of operations would be adversely affected if the premiums for our
liability, workers' compensation and casualty claims were to increase
substantially.
OUR OPERATING RESULTS ARE SUBJECT TO SEASONAL FLUCTUATIONS.
Our operations are subject to seasonal trends common to the moving industry.
Results of operations for the quarter ending in March are typically lower than
the quarters ending in June, September and December due to reduced shipments and
higher operating costs in the winter months. We serve numerous industries and
customers that experience significant fluctuations in demand based on economic
conditions and other factors beyond our control. Demand for our services could
be materially adversely affected by downturns in the business of our corporate
customers or a decrease in the frequency of household moves. See "Management's
Discussion and Analysis of Results of Operations and Financial Condition--
Seasonality."
IF WE DO NOT SUCCESSFULLY COMPETE WITHIN THE HIGHLY COMPETITIVE RELOCATION AND
LOGISTICS SERVICES INDUSTRY, WE MAY BE UNABLE TO REPAY THE NOTES.
The relocation services business is highly competitive and fragmented. Aside
from the handful of large van lines, the industry remains extremely fragmented
with many small private participants that may have strong positions in local
markets. We compete primarily with truckload carriers and independent
contractors and, with respect to certain aspects of our business, intermodal
transportation, railroads and less-than-truckload carriers. Intermodal
transportation (the hauling of truck trailers or containers on rail cars or
ships) has increased in recent years as reductions in train crew size and the
development of new rail technology have reduced costs of intermodal shipping.
The logistics industry is becoming increasingly consolidated due to, among other
things, the need for global distribution networks, large vehicle fleets and
global information technology systems. In addition, consolidation is driven by
customers' desire for integrated services, the high growth in international and
cross-border delivery segments and, in Europe, the deregulation of European
delivery markets. Industry participants are acquiring, merging with or forming
alliances with partners that can expand global reach, breadth of services or
technological capabilities in order to better enable those participants to
compete in a rapidly changing global environment. One of our largest logistics
customers recently indicated that it is considering alternative suppliers, which
will result in its doing less business with us. See "Business--Customers and
Marketing." If we do not successfully compete within the highly competitive
relocation and logistics services industry, we may be unable to pay the notes.
IF WE LOST ONE OR MORE OF OUR GOVERNMENT LICENSES OR PERMITS OR BECAME SUBJECT
TO MORE ONEROUS GOVERNMENT REGULATIONS, WE COULD BE ADVERSELY AFFECTED.
Our operations are subject to a number of complex and stringent
transportation, environmental, labor, employment and other laws and regulations.
These laws and regulations generally require us to maintain a wide variety of
certificates, permits, licenses and other approvals. Our failure to maintain
required certificates, permits or licenses, or to comply with applicable laws,
ordinances or regulations, could result in substantial fines or possible
revocation of our authority to conduct our operations.
We cannot assure you that existing laws or regulations will not be revised
or that new laws or regulations, which could have an adverse impact on our
operations, will not be adopted or become applicable to us. We also cannot
assure you that we will be able to recover any or all increased costs of
compliance from our customers or that our business and financial condition will
not be materially and
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adversely affected by future changes in applicable laws and regulations. See
"Business--Government Regulation."
THE INTERNATIONAL SCOPE OF OUR OPERATIONS MAY ADVERSELY AFFECT OUR BUSINESS.
We may face certain risks because we conduct an international business,
including:
- regulatory restrictions or prohibitions on the provision of our services;
- restrictions on foreign ownership of subsidiaries;
- tariffs and other trade barriers;
- longer payment cycles;
- problems in collecting accounts receivables;
- political risks; and
- potentially adverse tax consequences of operating in multiple
jurisdictions.
In addition, an adverse change in laws or administrative practices in
countries within which we operate could have a material adverse effect on us.
We are exposed to fluctuation in foreign currencies, as our revenues, costs,
assets and liabilities are denominated in multiple local currencies. Our payment
obligations with respect to the notes and a significant amount of our other
indebtedness are denominated in U.S. Dollars, but a substantial portion of our
revenues is denominated in other currencies as well. Any appreciation in the
value of the U.S. Dollar relative to such currencies could have an adverse
effect on us.
EVENTS DESCRIBED BY OUR FORWARD LOOKING STATEMENTS MAY NOT OCCUR.
This prospectus contains forward-looking statements that are subject to
risks and uncertainties. You should not place undue reliance on these
statements. Forward-looking statements include information concerning our
possible or assumed future results of operations, including descriptions of our
business strategies. These statements often include words such as "believe,"
"expect," "anticipate," "intend," "plan," "estimate," "seek," "will," "may" or
similar expressions. These statements are based on certain assumptions that we
have made in light of our experience in the industry as well as our perceptions
of historical trends, current conditions, expected future developments and other
factors we believe are appropriate in these circumstances. As you read and
consider this prospectus, you should understand that these statements are not
guarantees of performance or results. They involve risks, uncertainties and
assumptions. Many factors could affect our actual financial results or results
of operations and could cause actual results to differ materially from those in
the forward-looking statements. These factors include:
- operations and prospects,
- ability to achieve estimated cost savings,
- funding needs and financing sources,
- expected financial position,
- business and financing plans,
- markets, including the future growth of the logistics and relocation
markets,
- expected characteristics of competition,
- expected actions of third parties such as agents, representatives,
owner/operators and suppliers and
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- various other factors beyond our control.
All future written and oral forward-looking statements by us or persons
acting on our behalf are expressly qualified in their entirety by the cautionary
statements contained or referred to above. We do not have any obligation or
intention to update or revise any forward-looking statements to reflect events
or circumstances in the future or to reflect the occurrence of unanticipated
events.
THESE RISKS AND UNCERTAINTIES ARE NOT THE ONLY ONES FACING US.
Additional risks and uncertainties not presently known to us or that we may
currently deem immaterial may also impair our business operations.
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THE EXCHANGE OFFER
The following contains a summary of the material provisions of the
registration rights agreement. It does not contain all of the information that
may be important to an investor in the notes. Reference is made to the
provisions of the registration rights agreement, which has been filed as an
exhibit to the registration statement. Copies are available as set forth under
the heading "Where You Can Find More Information."
TERMS OF THE EXCHANGE OFFER
GENERAL. In connection with the issuance of the old notes pursuant to a
purchase agreement, dated as of November 12, 1999, between North American Van
Lines and the initial purchasers, the initial purchasers and their respective
assignees became entitled to the benefits of the registration rights agreement.
Under the registration rights agreement, we have agreed (1) to use our
reasonable best efforts to cause to be filed with the Commission the
registration statement of which this prospectus is a part with respect to a
registered offer to exchange the old notes for the new notes and (2) to use all
commercially reasonable efforts to cause the registration statement to be
declared effective under the Securities Act within 210 calendar days after the
initial issuance of the old notes. We will keep the exchange offer open for the
period required by applicable law, but in any event for at least ten business
days after the date notice of the exchange offer is mailed to holders of the old
notes. The exchange offer being made hereby, if consummated within 240 days
after the initial issuance of the old notes, will satisfy those requirements
under the registration rights agreement.
Upon the terms and subject to the conditions set forth in this prospectus
and in the letter of transmittal, all old notes validly tendered and not
withdrawn prior to 5:00 p.m., New York City time, on the expiration date will be
accepted for exchange. New notes will be issued in exchange for an equal
principal amount of outstanding old notes accepted in the exchange offer. Old
notes may be tendered only in integral multiples of $1,000. This prospectus,
together with the letter of transmittal, is being sent to all registered holders
as of , 2000. The exchange offer is not conditioned upon any minimum
principal amount of old notes being tendered for exchange. However, the
obligation to accept old notes for exchange pursuant to the exchange offer is
subject to certain customary conditions as set forth herein under
"--Conditions."
Old notes shall be deemed to have been accepted as validly tendered when, as
and if we have given oral or written notice thereof to the exchange agent. The
exchange agent will act as agent for the tendering holders of old notes for the
purposes of receiving the new notes and delivering new notes to such holders.
Based on interpretations by the Staff of the Commission as set forth in
no-action letters issued to third parties (including Exxon Capital Holdings
Corporation (available May 13, 1988), Morgan Stanley & Co. Incorporated
(available June 5, 1991), K-III Communications Corporation (available May 14,
1993) and Shearman & Sterling (available July 2, 1993)), we believe that the new
notes issued pursuant to the exchange offer may be offered for resale, resold
and otherwise transferred by any holder thereof (other than any such holder that
is a broker-dealer or an "affiliate" of us within the meaning of Rule 405 under
the Securities Act) without compliance with the registration and prospectus
delivery provisions of the Securities Act, provided that:
- such new notes are acquired in the ordinary course of business,
- at the time of the commencement of the exchange offer such holder has no
arrangement or understanding with any person to participate in a
distribution of such new notes, and
- such holder is not engaged in, and does not intend to engage in, a
distribution of such new notes.
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We have not sought, and do not intend to seek, a no-action letter from the
Commission with respect to the effects of the exchange offer, and there can be
no assurance that the Staff would make a similar determination with respect to
the new notes as it has in such no-action letters.
By tendering old notes in exchange for new notes and executing the letter of
transmittal, each holder will represent to us that:
- any new notes to be received by it will be acquired in the ordinary
course of business,
- it has no arrangements or understandings with any person to participate
in the distribution of the old notes or new notes within the meaning of
the Securities Act, and
- it is not our "affiliate," as defined in Rule 405 under the Securities
Act.
If such holder is a broker-dealer, it will also be required to represent that
the old notes were acquired as a result of market-making activities or other
trading activities and that it will deliver a prospectus in connection with any
resale of new notes. See "Plan of Distribution." Each holder, whether or not it
is a broker-dealer, shall also represent that it is not acting on behalf of any
person that could not truthfully make any of the foregoing representations
contained in this paragraph. If a holder of old notes is unable to make the
foregoing representations, such holder may not rely on the applicable
interpretations of the Staff of the Commission and must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any secondary resale transaction unless such sale is made
pursuant to an exemption from such requirements.
Each broker-dealer that receives new notes for its own account in exchange
for old notes where such new notes were acquired by such broker-dealer as a
result of market-making or other trading activities, must acknowledge that it
will deliver a prospectus meeting the requirements of the Securities Act and
that it has not entered into any arrangement or understanding with us or an
affiliate of ours to distribute the new notes in connection with any resale of
such new notes. See "Plan of Distribution."
Upon consummation of the exchange offer, any old notes not tendered will
remain outstanding and continue to accrue interest but, subject to certain
limited exceptions, holders of old notes who do not exchange their old notes for
new notes in the exchange offer will no longer be entitled to registration
rights and will not be able to offer or sell their old notes, unless such old
notes are subsequently registered under the Securities Act, except pursuant to
an exemption from, or in a transaction not subject to, the Securities Act and
applicable state securities laws. Subject to limited exceptions, we will have no
obligation to effect a subsequent registration of the old notes.
EXPIRATION DATE; EXTENSIONS; AMENDMENTS; TERMINATION. The expiration date
shall be , 2000, unless North American Van Lines, in its sole
discretion, extends the exchange offer, in which case the expiration date shall
be the latest date to which the exchange offer is extended.
To extend the expiration date, we will notify the exchange agent of any
extension by oral or written notice and will notify the holders of old notes by
means of a press release or other public announcement prior to 9:00 A.M., New
York City time, on the next business day after the previously scheduled
expiration date. Such announcement may state that we are extending the exchange
offer for a specified period of time.
We reserve the right
(1) to delay acceptance of any old notes, to extend the exchange offer or to
terminate the exchange offer and not permit acceptance of old notes not
previously accepted if any of the conditions set forth herein under
"--Conditions" shall have occurred and shall not have been waived by us
prior to the expiration date, by giving oral or written notice of such
delay, extension or termination to the exchange agent, or
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(2) to amend the terms of the exchange offer in any manner deemed by it to
be advantageous to the holders of the old notes.
Any such delay in acceptance, extension, termination or amendment will be
followed as promptly as practicable by oral or written notice thereof to the
exchange agent. If the exchange offer is amended in a manner determined by us to
constitute a material change, we will promptly disclose such amendment in a
manner reasonably calculated to inform the holders of the old notes of such
amendment.
Without limiting the manner in which we may choose to make public
announcement of any delay, extension, amendment or termination of the exchange
offer, we shall have no obligations to publish, advertise, or otherwise
communicate any such public announcement, other than by making a timely release
to an appropriate news agency.
INTEREST ON THE NEW NOTES
The new notes will accrue interest at the rate of 13 3/8% per annum from the
last interest payment date on which interest was paid on the old note
surrendered in exchange therefor, or, if no interest has been paid on such old
note, from the issue date of such old note, PROVIDED, that if an old note is
surrendered for exchange on or after a record date for an interest payment date
that will occur on or after the date of such exchange and as to which interest
will be paid, interest on the new note received in exchange therefor will accrue
from the date of such interest payment date. Interest on the new notes is
payable on December 1 and June 1 of each year, commencing June 1, 2000. No
additional interest will be paid on old notes tendered and accepted for
exchange.
PROCEDURES FOR TENDERING
To tender in the exchange offer, a holder must complete, sign and date the
applicable letter of transmittal, or a facsimile thereof, have the signatures
thereon guaranteed if required by the letter of transmittal, and mail or
otherwise deliver such letter of transmittal or such facsimile, together with
any other required documents, to the exchange agent prior to 5:00 p.m., New York
City time, on the expiration date. In addition, either
- certificates of such old notes must be received by the exchange agent
along with the applicable letter of transmittal, or
- a timely confirmation of a book-entry transfer of such old notes, if such
procedure is available, into the exchange agent's account at the
book-entry transfer facility, The Depository Trust Company, pursuant to
the procedure for book-entry transfer described below, must be received
by the exchange agent prior to the expiration date with the applicable
letter of transmittal, or
- the holder must comply with the guaranteed delivery procedures described
below.
THE METHOD OF DELIVERY OF OLD NOTES, LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS IS AT THE ELECTION AND RISK OF THE NOTE HOLDERS. IF SUCH
DELIVERY IS BY MAIL, IT IS RECOMMENDED THAT REGISTERED MAIL, PROPERLY INSURED,
WITH RETURN RECEIPT REQUESTED, BE USED. IN ALL CASES, SUFFICIENT TIME SHOULD BE
ALLOWED TO ASSURE TIMELY DELIVERY. NO OLD NOTES, LETTERS OF TRANSMITTAL OR OTHER
REQUIRED DOCUMENTS SHOULD BE SENT TO US. Delivery of all old notes (if
applicable), letters of transmittal and other documents must be made to the
exchange agent at its address set forth below. Holders may also request their
respective brokers, dealers, commercial banks, trust companies or nominees to
effect such tender for such holders.
The tender by a holder of old notes will constitute an agreement between
such holder and us in accordance with the terms and subject to the conditions
set forth herein and in the applicable letter of transmittal. Any beneficial
owner whose old notes are registered in the name of a broker, dealer, commercial
bank, trust company or other nominee and who wishes to tender should contact
such registered holder promptly and instruct such registered holder to tender on
his behalf.
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Signatures on a letter of transmittal or a notice of withdrawal, as the case
may be, must be guaranteed by any member firm of a registered national
securities exchange or of the National Association of Securities Dealers, Inc.,
a commercial bank or trust company having an office or correspondent in the
United States or an "eligible guarantor" institution within the meaning of
Rule 17Ad-15 under the Securities Exchange Act of 1934 (each an "Eligible
Institution") unless the old notes tendered pursuant thereto are tendered
(1) by a registered holder of old notes who has not completed the box entitled
"Special Issuance Instructions" or "Special Delivery Instructions" on the letter
of transmittal or (2) for the account of an Eligible Institution.
If a letter of transmittal is signed by trustees, executors, administrators,
guardians, attorneys-in-fact, officers of corporations or others acting in a
fiduciary or representative capacity, such person should so indicate when
signing, and unless waived by us, evidence satisfactory to us of their authority
to so act must be submitted with such letter of transmittal.
All questions as to the validity, form, eligibility, time of receipt and
withdrawal of the tendered old notes will be determined by us in our sole
discretion, which determination will be final and binding. We reserve the
absolute right to reject any and all old notes not properly tendered or any old
notes which, if accepted, would, in the opinion of counsel for us, be unlawful.
We also reserve the absolute right to waive any irregularities or conditions of
tender as to particular old notes. Our interpretation of the terms and
conditions of the exchange offer, including the instructions in the letter of
transmittal, will be final and binding on all parties. Unless waived, any
defects or irregularities in connection with tenders of old notes must be cured
within such time as we shall determine. Neither we, the exchange agent nor any
other person shall be under any duty to give notification of defects or
irregularities with respect to tenders of old notes, nor shall any of them incur
any liability for failure to give such notification. Tenders of old notes will
not be deemed to have been made until such irregularities have been cured or
waived. Any old note received by the exchange agent that is not properly
tendered and as to which the defects or irregularities have not been cured or
waived will be returned without cost to such holder by the exchange agent,
unless otherwise provided in the letter of transmittal, as soon as practicable
following the expiration date.
In addition, we reserve the right in our sole discretion, subject to the
provisions of the indentures pursuant to which the notes are issued,
- to purchase or make offers for any old notes that remain outstanding
subsequent to the expiration date or, as set forth under "--Conditions,"
to terminate the exchange offer,
- to redeem old notes as a whole or in part at any time and from time to
time, as set forth under "Description of the Notes--Optional
Redemption," and
- to the extent permitted under applicable law, to purchase old notes in
the open market, in privately negotiated transactions or otherwise.
The terms of any such purchases or offers could differ from the terms of the
exchange offer.
ACCEPTANCE OF OLD NOTES FOR EXCHANGE; DELIVERY OF NEW NOTES
Upon satisfaction or waiver of all of the conditions to the exchange offer,
all old notes properly tendered will be accepted promptly after the expiration
date, and the new notes will be issued promptly after acceptance of the old
notes. See "--Conditions." For purposes of the exchange offer, old notes shall
be deemed to have been accepted as validly tendered for exchange when, as and if
we have given oral or written notice thereof to the exchange agent. For each old
note accepted for exchange, the holder of such old note will receive a new note
having a principal amount equal to that of the surrendered old note.
In all cases, issuance of new notes for old notes that are accepted for
exchange pursuant to the exchange offer will be made only after timely receipt
by the exchange agent of
25
<PAGE>
- certificates for such old notes or a timely book-entry confirmation of
such old notes into the exchange agent's account at the applicable
book-entry transfer facility,
- a properly completed and duly executed letter of transmittal, and
- all other required documents.
If any tendered old notes are not accepted for any reason set forth in the terms
and conditions of the exchange offer, such unaccepted or such nonexchanged old
notes will be returned without expense to the tendering holder thereof (if in
certificated form) or credited to an account maintained with such book-entry
transfer facility as promptly as practicable after the expiration or termination
of the exchange offer.
BOOK-ENTRY TRANSFER
The exchange agent will make a request to establish an account with respect
to the old notes at the book-entry transfer facility for purposes of the
exchange offer within two business days after the date of this prospectus. Any
financial institution that is a participant in the book-entry transfer
facility's systems may make book-entry delivery of old notes by causing the
book-entry transfer facility to transfer such old notes into the exchange
agent's account at the book-entry transfer facility in accordance with such
book-entry transfer facility's procedures for transfer. However, although
delivery of old notes may be effected through book-entry transfer at the
book-entry transfer facility, the letter of transmittal or facsimile thereof
with any required signature guarantees and any other required documents must, in
any case, be transmitted to and received by the exchange agent at one of the
addresses set forth below under "--Exchange Agent" on or prior to the expiration
date or the guaranteed delivery procedures described below must be complied
with.
EXCHANGING BOOK-ENTRY NOTES
The exchange agent and the book-entry transfer facility have confirmed that
any financial institution that is a participant in the book-entry transfer
facility may utilize the book-entry transfer facility Automated Tender Offer
Program ("ATOP") procedures to tender old notes.
Any participant in the book-entry transfer facility may make book-entry
delivery of old notes by causing the book-entry transfer facility to transfer
such old notes into the exchange agent's account in accordance with the
book-entry transfer facility's ATOP procedures for transfer. However, the
exchange for the old notes so tendered will only be made after a book-entry
confirmation of the book-entry transfer of old notes into the exchange agent's
account, and timely receipt by the exchange agent of an agent's message and any
other documents required by the letter of transmittal. The term "agent's
message" means a message, transmitted by the book-entry transfer facility and
received by the exchange agent and forming part of a book-entry confirmation,
which states that the book-entry transfer facility has received an express
acknowledgment from a participant tendering old notes that are the subject of
such book-entry confirmation that such participant has received and agrees to be
bound by the terms of the letter of transmittal, and that we may enforce such
agreement against such participant.
GUARANTEED DELIVERY PROCEDURES
If the procedures for book-entry transfer cannot be completed on a timely
basis, a tender may be effected if
- the tender is made through an Eligible Institution,
- prior to the expiration date, the exchange agent receives by facsimile
transmission, mail or hand delivery from such Eligible Institution a
properly completed and duly executed letter of transmittal and notice of
guaranteed delivery, substantially in the form provided by us, which
26
<PAGE>
(1) sets forth the name and address of the holder of old notes and the
amount of old notes tendered,
(2) states that the tender is being made thereby, and
(3) guarantees that within three New York Stock Exchange ("NYSE") trading
days after the date of execution of the notice of guaranteed delivery,
the certificates for all physically tendered old notes, in proper form
for transfer, or a book-entry confirmation, as the case may be, and any
other documents required by the letter of transmittal will be deposited
by the Eligible Institution with the exchange agent, and
- the certificates for all physically tendered old notes, in proper form
for transfer, or a book-entry confirmation, as the case may be, and all
other documents required by the letter of transmittal are received by the
exchange agent within three NYSE trading days after the date of execution
of the notice of guaranteed delivery.
WITHDRAWAL OF TENDERS
Tenders of old notes may be withdrawn at any time prior to 5:00 p.m., New
York City time, on the expiration date.
For a withdrawal to be effective, a written notice of withdrawal must be
received by the exchange agent prior to 5:00 p.m., New York City time on the
expiration date at the address set forth below under "--Exchange Agent." Any
such notice of withdrawal must
- specify the name of the person having tendered the old notes to be
withdrawn,
- identify the old notes to be withdrawn, including the principal amount
of such old notes,
- in the case of old notes tendered by book-entry transfer, specify the
number of the account at the book-entry transfer facility from which the
old notes were tendered and specify the name and number of the account
at the book-entry transfer facility to be credited with the withdrawn
old notes and otherwise comply with the procedures of such facility,
- contain a statement that such holder is withdrawing its election to have
such old notes exchanged,
- be signed by the holder in the same manner as the original signature on
the letter of transmittal by which such old notes were tendered,
including any required signature guarantees, or be accompanied by
documents of transfer to have the trustee with respect to the old notes
register the transfer of such old notes in the name of the person
withdrawing the tender, and
- specify the name in which such old notes are registered, if different
from the person who tendered such old notes.
All questions as to the validity, form, eligibility and time of receipt of such
notice will be determined by us, whose determination shall be final and binding
on all parties. Any old notes so withdrawn will be deemed not to have been
validly tendered for exchange for purposes of the exchange offer. Any old notes
which have been tendered for exchange but which are not exchanged for any reason
will be returned to the tendering holder thereof without cost to such holder, in
the case of physically tendered old notes, or credited to an account maintained
with the book-entry transfer facility for the old notes as soon as practicable
after withdrawal, rejection of tender or termination of the exchange offer.
Properly withdrawn old notes may be retendered by following one of the
procedures described under "--Procedures for Tendering" and "--Book-Entry
Transfer" above at any time on or prior to 5:00 p.m., New York City time, on the
expiration date.
27
<PAGE>
CONDITIONS
Notwithstanding any other provision of the exchange offer, we shall not be
required to accept for exchange, or to issue new notes in exchange for, any old
notes and may terminate or amend the exchange offer if at any time prior to
5:00 p.m., New York City time, on the expiration date, we determine in our
reasonable judgment that the exchange offer violates applicable law, any
applicable interpretation of the Staff of the Commission or any order of any
governmental agency or court of competent jurisdiction.
The foregoing conditions are for our sole benefit and may be asserted by us
regardless of the circumstances giving rise to any such condition or may be
waived by us in whole or in part at any time and from time to time in our
reasonable discretion. Our failure at any time to exercise any of the foregoing
rights shall not be deemed a waiver of any such right and each such right shall
be deemed an ongoing right which may be asserted at any time and from time to
time.
In addition, we will not accept for exchange any old notes tendered, and no
new notes will be issued in exchange for any such old notes, if at such time any
stop order shall be threatened or in effect with respect to the registration
statement of which this prospectus constitutes a part or the qualification of
either indenture under the Trust Indenture Act of 1939, as amended. We are
required to use every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the registration statement at the earliest
possible time.
EXCHANGE AGENT
State Street Bank and Trust Company has been appointed as exchange agent for
the exchange offer. Questions and requests for assistance and requests for
additional copies of this prospectus or of the letter of transmittal should be
directed to the exchange agent addressed as follows:
<TABLE>
<S> <C>
BY MAIL, HAND DELIVERY OR FOR INFORMATION CALL:
OVERNIGHT CARRIER: (617) 662-1603
State Street Bank and Trust Company FACSIMILE TRANSMISSION NUMBER:
Corporate Trust Department (617) 662-1452
5th Floor CONFIRM BY TELEPHONE:
2 Avenue de Lafayette (617) 662-1603
Boston, Massachusetts 02111
Attention: Meaghan Haight
</TABLE>
FEES AND EXPENSES
The expenses of soliciting tenders pursuant to the exchange offer will be
borne by us. The principal solicitation for tenders pursuant to the exchange
offer is being made by mail; however, additional solicitations may be made by
telegraph, telephone, telecopy or in person by our officers and regular
employees.
We will not make any payments to brokers, dealers or other persons
soliciting acceptances of the exchange offer. We will, however, pay the exchange
agent reasonable and customary fees for its services and will reimburse the
exchange agent for its reasonable out-of-pocket expenses in connection
therewith. We may also pay brokerage houses and other custodians, nominees and
fiduciaries the reasonable out-of-pocket expenses incurred by them in forwarding
copies of the prospectus and related documents to the beneficial owners of the
old notes, and in handling or forwarding tenders for exchange.
The expenses to be incurred by us in connection with the exchange offer will
be paid by us, including fees and expenses of the exchange agent and trustee and
accounting, legal, printing and related fees and expenses.
28
<PAGE>
We will pay all transfer taxes, if any, applicable to the exchange of old
notes pursuant to the exchange offer. If, however, new notes or old notes for
principal amounts not tendered or accepted for exchange are to be registered or
issued in the name of any person other than the registered holder of the old
notes tendered, or if tendered old notes are registered in the name of any
person other than the person signing the letter of transmittal, or if a transfer
tax is imposed for any reason other than the exchange of old notes pursuant to
the exchange offer, then the amount of any such transfer taxes imposed on the
registered holder or any other persons will be payable by the tendering holder.
If satisfactory evidence of payment of such taxes or exemption therefrom is not
submitted with the letter of transmittal, the amount of such transfer taxes will
be billed directly to such tendering holder.
CONSEQUENCES OF FAILURE TO EXCHANGE
Holders of old notes who do not exchange their old notes for new notes
pursuant to the exchange offer will continue to be subject to the restrictions
on transfer of such old notes as set forth in the legend thereon as a
consequence of the issuance of the old notes pursuant to exemptions from, or in
transactions not subject to, the registration requirements of the Securities Act
and applicable state securities laws. In general, the old notes may not be
offered or sold, unless registered under the Securities Act, except pursuant to
an exemption from, or in a transaction not subject to, the Securities Act and
applicable state securities laws. North American Van Lines does not currently
anticipate that it will register the old notes under the Securities Act. To the
extent that old notes are tendered and accepted in the exchange offer, the
trading market for untendered and tendered but unaccepted old notes could be
adversely affected.
29
<PAGE>
THE ALLIED ACQUISITION
On November 19, 1999, pursuant to an acquisition agreement, dated
September 14, 1999, between Allied Worldwide and NFC, we acquired the Allied and
Pickfords businesses from NFC. At the time of the acquisition, we acquired
(through purchase or subscription) stock of various NFC subsidiaries located
throughout the world, and the moving van-related assets of NFC's Canadian
operating subsidiary, in exchange for (1) $400.0 million, (2) 24,500 shares of
junior preferred stock of Allied Worldwide, having an initial liquidation
preference of $24.5 million, (3) 174,961 shares of common stock of Allied
Worldwide, representing approximately 20.0% of Allied Worldwide's issued and
outstanding common stock (giving effect to vested options as of September 14,
1999) and (4) a warrant to purchase 87,480 shares of common stock of Allied
Worldwide at an exercise price of $400.00 per share.
The closing of the acquisition occurred simultaneously with the initial
offering of the notes and the initial borrowings under the new senior credit
facility, which facility includes a $150.0 million term loan, a $175.0 million
term loan and a $150.0 million revolving credit facility. In addition, as part
of the financing for the Allied acquisition, Allied Worldwide incurred
$35.0 million initial accreted value of unsecured senior discount term loan
borrowings. The lenders under this senior discount loan are expected to exchange
the senior discount loan for senior discount notes of Allied Worldwide prior to
February 17, 2000. Further, also as part of that financing, Allied Worldwide
borrowed $40.0 million in term loan borrowings under an interim loan facility.
On December 1, 1999, Clayton, Dubilier & Rice Fund V Limited Partnership, our
controlling shareholder, and NFC subscribed for and purchased additional shares
of common stock of Allied Worldwide for $32.0 million and $8.0 million in cash,
respectively. The proceeds from this stock subscription were used to repay this
$40 million interim loan. See "Description of Other Indebtedness."
Following the acquisition, Clayton, Dubilier & Rice Fund V Limited
Partnership continues to be the controlling shareholder of Allied Worldwide,
owning approximately 62.4% of the outstanding common stock of Allied Worldwide
on a fully diluted basis. In addition, on a fully diluted basis, NFC owns
approximately 23.7% of the outstanding common stock of Allied Worldwide, and the
remaining 13.9% is held by various investors, including members of management
and agents.
The following table summarizes the estimated sources and uses of funds for
the acquisition and related transactions (in millions):
<TABLE>
<CAPTION>
SOURCES OF FUNDS: AMOUNT
- ----------------- --------
<S> <C>
Revolving credit facility(1)......... $ 74.0
Term loans........................... 325.0
Old notes............................ 150.0
Allied Worldwide senior discount
loan............................... 35.0
Junior preferred stock............... 24.5
Allied Worldwide common stock and
warrant(2)......................... 65.5
------
Total Sources of Funds............. $674.0
======
<CAPTION>
USES OF FUNDS: AMOUNT
- -------------- --------
<S> <C>
Purchase of Allied:
Cash consideration................. $400.0
Junior preferred stock............. 24.5
Allied Worldwide common stock and
warrant......................... 25.5
Repayment of existing NAVL
indebtedness....................... 190.0
Estimated fees and expenses.......... 34.0
------
Total Uses of Funds................ $674.0
======
</TABLE>
- ------------------------
(1) Represents the initial drawdown under the new $150.0 million revolving
credit facility.
(2) Of this $65.5 million, $40.0 million was initially in the form of an interim
loan to Allied Worldwide. Allied Worldwide repaid this loan with the
proceeds of the stock subscription described above.
30
<PAGE>
USE OF PROCEEDS
There will be no proceeds from the issuance of new notes pursuant to the
exchange offer.
The net proceeds from the original offering were $145.4 million, after
deducting discounts and commissions and expenses of the original offering
payable by North American Van Lines. We used the net proceeds from the original
offering primarily to finance the Allied acquisition.
31
<PAGE>
CAPITALIZATION
The following table sets forth NAVL's and Allied's total capitalization at
September 25, 1999 and June 30, 1999, respectively, and as adjusted to reflect
the Allied acquisition, the issuance of the notes and the application of the net
proceeds as described under "Use of Proceeds," and the initial borrowings under
the new senior credit facility, as if such transactions had been consummated on
September 25, 1999. This table should be read in conjunction with the audited
and unaudited financial statements and related notes appearing elsewhere in this
prospectus and "Management's Discussion and Analysis of Results of Operations
and Financial Condition."
<TABLE>
<CAPTION>
AS OF SEPTEMBER 25, 1999
-------------------------------------------------
HISTORICAL
----------------------- PRO FORMA
NAVL ALLIED(1)(2) ADJUSTMENTS PRO FORMA
-------- ------------ ----------- ---------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
Cash and cash equivalents......................... $ 1,228 $ 40,922 $ (40,922) $ 1,228
======== ======== ========= ========
Debt, including current maturities:
Existing credit facilities(3)................... 176,375 -- (176,375) --
Intercompany payable to NFC..................... -- 266,862 (266,862) --
New revolving credit facility................... -- -- 60,375 60,375
New term loans.................................. -- -- 325,000 325,000
Notes........................................... -- -- 150,000 150,000
Other debt(4)................................... 1,884 -- -- 1,884
-------- -------- --------- --------
Total debt.................................... 178,259 266,862 92,138 537,259
Minority interests................................ 488 -- -- 488
Stockholders' equity(5)........................... 56,835 (68,098) 182,557 171,294
-------- -------- --------- --------
Total capitalization.............................. $235,582 $198,764 $ 274,695 $709,041
======== ======== ========= ========
</TABLE>
- ------------------------
(1) Represents the capitalization of Allied as of June 30, 1999.
(2) The historical Allied capitalization has been translated from Pounds
sterling to U.S. Dollars using the end-of-period exchange rate as of
June 30, 1999 and has been adjusted to conform to U.S. GAAP.
(3) The difference between the amount of existing NAVL indebtedness of
$176.4 million reflected above versus $190.0 million shown in the sources
and uses table under "The Allied Acquisition" above is solely due to
drawdowns during the period from September 25, 1999 through November 19,
1999 on the revolving credit facility in place prior to the Allied
acquisition.
(4) Comprised of borrowings of $1,337 by NAVL's Canadian subsidiary against that
subsidiary's CAN$2,500 revolving line of credit, a bank loan held by NAVL's
Canadian subsidiary of $70 and a capital lease obligation of $477 for NAVL's
joint venture, Manufacturing Support Services, LLC.
(5) See note (d) to Unaudited Pro Forma Balance Sheet for further details
regarding the pro forma adjustments to stockholders' equity.
32
<PAGE>
UNAUDITED PRO FORMA FINANCIAL STATEMENTS
The following unaudited pro forma condensed financial statements of North
American Van Lines are based on the historical financial statements of NAVL and
the historical financial statements of Allied included elsewhere in this
prospectus, adjusted to give effect to the following: (1) the Allied
acquisition; (2) the receipt of the proceeds from the offering of the notes and
initial borrowings under the new senior credit facility; (3) an increase in
shareholders' equity resulting from the issuance of junior preferred stock,
senior discount notes, common stock and a common stock warrant by Allied
Worldwide, and (4) the payment of all fees and expenses related to the Allied
acquisition and its financing. See "The Allied Acquisition."
The pro forma adjustments presented are based upon available information and
certain assumptions that management believes are reasonable. The historical
condensed income statements for the nine months ended September 25, 1999 (NAVL)
and June 30, 1999 (Allied) and the historical consolidated balance sheet data at
September 25, 1999 (NAVL) and June 30, 1999 (Allied) were derived from the
unaudited financial statements of NAVL and the unaudited condensed financial
statements of Allied included elsewhere in this prospectus. The historical
condensed income statements for the periods ended December 26, 1998 (NAVL) and
September 30, 1998 (Allied) were derived from the audited consolidated financial
statements of NAVL and the audited combined financial statements of Allied
appearing elsewhere in this prospectus.
The historical Allied financial statements included in the pro forma periods
presented have been translated from Pounds sterling to U.S. Dollars as indicated
using the exchange rate table included in the section "Presentation of Financial
Information" above. Additionally, the historical Allied financial statements
have been adjusted to reflect U.S. GAAP.
The historical Allied financial statements reflect estimated revenue and
related transportation expenses on the date a shipment is loaded ("loaded
basis"). North American Van Lines recognizes estimated revenue and related
transportation expenses on the date a shipment is delivered or services are
completed ("delivered basis"), the preferred method under U.S. GAAP. The effect
of this change, including the impact to accounts receivable, accrued liabilities
and goodwill, has not yet been completed. However, management believes that the
impact of changing Allied financial statements from a loaded basis to a
delivered basis on operating revenue and income from operations is not expected
to be material.
The unaudited pro forma condensed income statements for the nine months
ended September 25, 1999, for the twelve months ended December 26, 1998, give
effect to the Allied acquisition and its financing as if they had occurred on
December 28, 1997. The unaudited pro forma condensed balance sheet data gives
effect to the Allied acquisition and its financing as if they had occurred on
September 25, 1999.
The unaudited pro forma financial data should be read in conjunction with
the historical consolidated financial statements of NAVL and the notes thereto,
the historical combined financial statements of Allied and the notes thereto,
"Management's Discussion and Analysis of Results of Operations and Financial
Condition" and other financial data appearing elsewhere in this prospectus as
well as the information concerning the Allied acquisition.
The pro forma financial data and related notes are provided for
informational purposes only and do not necessarily reflect the results of
operations or financial position of North American Van Lines that would have
actually resulted had the events referred to above or in the notes to the
unaudited pro forma financial data been consummated as of the date and for the
periods indicated and are not intended to project North American Van Lines'
results of operations or financial position for any future period.
33
<PAGE>
NORTH AMERICAN VAN LINES, INC.
UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
AS OF SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
NAVL AS OF ALLIED
SEPTEMBER 25, AS OF PRO FORMA
1999 JUNE 30, 1999 ADJUSTMENTS PRO FORMA
------------- ------------- ----------- ----------
<S> <C> <C> <C> <C>
ASSETS:
Current assets:
Cash and cash equivalents............. $ 1,228 $ 40,922 $(40,922)(a) $ 1,228
Accounts receivable, net.............. 168,870 173,168 342,038
Other current assets.................. 46,866 5,688 52,554
--------- -------- -------- ----------
Total current assets................ 216,964 219,778 (40,922) 395,820
Property and equipment, net............. 59,087 70,310 41,870 (a) 171,267
Intangible assets, net.................. 93,408 46,452 (46,452)(a) 93,408
Investments............................. 1,484 49,928 51,412
Unallocated excess (goodwill)........... 301,694 (a) 301,694
Other assets............................ 41,935 10,112 (5,673)(c) 75,506
26,920 (a)
2,212 (c)
--------- -------- -------- ----------
Total assets........................ $ 412,878 $396,580 $279,649 $1,089,107
========= ======== ======== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Current portion of long-term debt..... $ 5,475 $ -- $ (5,475)(b) $ --
Revolving credit facility............. 37,337 60,375 (b) 61,712
(36,000)(b)
Accounts payable...................... 44,490 44,490
Accrued transportation and other...... 101,155 101,155
--------- -------- -------- ----------
Total current liabilities........... 188,457 161,002 18,900 368,359
Long-term debt, less current portion.... 135,447 266,862 67,763 (b) 475,547
5,475 (b)
Other liabilities....................... 32,139 36,814 5,850 (a) 73,907
(896)(a)
--------- -------- -------- ----------
Total liabilities................... 356,043 464,678 97,092 917,813
Total stockholders' equity.............. 56,835 (68,098) 182,557 (d) 171,294
--------- -------- -------- ----------
Total liabilities and stockholders'
equity................................ $ 412,878 $396,580 $279,649 $1,089,107
========= ======== ======== ==========
</TABLE>
See accompanying notes to Unaudited Pro Forma Condensed Balance Sheet.
34
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(a) The Allied acquisition was accounted for as a purchase. Under purchasing
accounting, the total purchase cost and fair value of liabilities assumed
has been allocated to the assets and liabilities of North American Van Lines
based on their respective fair values as of the closing based on valuations
and other studies that have not yet been finalized. A preliminary allocation
of the purchase cost has been made to major categories of assets and
liabilities in the accompanying pro forma condensed financial information
based on management estimates. The actual allocation of purchase cost and
the resulting effect on income from operations may differ significantly from
the estimated pro forma amounts included herein.
<TABLE>
<S> <C>
Purchase cost:
Purchase price before estimated fees and expenses........... $450,000
Fees and expenses........................................... 34,000
--------
Total purchase cost....................................... 484,000
Adjusted book value of net assets acquired:
Adjusted net assets at June 30, 1999........................ (68,098)
Deferred financing costs.................................... 26,920
Transaction costs related to the issuance of equity......... 7,080
Cash not acquired........................................... (40,922)
Intercompany payable to NFC not assumed..................... 266,862
Elimination of historical goodwill.......................... (46,452)
--------
Adjusted book value of net assets acquired.................. 145,390
--------
Excess of purchase cost over adjusted book value of net
assets acquired........................................... 338,610
Preliminary allocation of purchase cost:
Decrease in surplus properties accrual...................... 896
Decrease due to leasehold disadvantage...................... (5,850)
Increase in property and equipment to estimated fair market
value..................................................... 41,870
--------
Total preliminary allocation of purchase cost............. 36,916
--------
Unallocated excess (goodwill)............................... $301,694
========
</TABLE>
(b) The estimated increase in debt consists of the following:
<TABLE>
<S> <C>
New revolving credit facility............................... $ 60,375
New term loans.............................................. 325,000
Notes offered hereby........................................ 150,000
Repayment of existing revolving credit facility............. (36,000)
Repayment of existing term loan facility (including current
portion of $5,475)........................................ (140,375)
Intercompany payable to NFC not assumed..................... (266,862)
--------
Increase in total debt...................................... 92,138
Less net change in revolving credit facility classified as
current................................................... 24,375
--------
Net increase in long-term debt.............................. $ 67,763
========
</TABLE>
(c) To reflect the write-off of existing NAVL deferred debt issuance costs and
the establishment of a deferred tax asset in respect of the write-off.
35
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED BALANCE SHEET (CONTINUED)
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(d) The pro forma net increase in stockholders' equity of $182,557 results from:
<TABLE>
<S> <C>
Capital contribution(1)..................................... $125,000
--------
Less:
Elimination of Allied historical equity..................... 68,098
Transaction costs related to the issuance of equity......... (7,080)
Write-off of existing deferred financing costs, net of
tax....................................................... (3,461)
--------
57,557
--------
Net increase in stockholders' equity........................ $182,557
========
</TABLE>
- ------------------------
(1) Includes (1) equity securities valued at $65,500, consisting of (a) 456,651
shares of Allied Worldwide common stock and (b) a warrant to purchase 87,480
shares of Allied Worldwide common stock at an exercise price of $400.00 per
share, (2) 24,500 shares of junior preferred stock of Allied Worldwide with
an initial liquidation preference of $24,500, and (3) senior discount notes
due 2009 issued by Allied Worldwide for aggregate proceeds of
$35.0 million. Of the equity securities valued at $65.5 million,
$40.0 million was initially in the form of an interim loan to Allied
Worldwide. Allied Worldwide repaid this loan with the proceeds of the stock
subscription.
36
<PAGE>
NORTH AMERICAN VAN LINES, INC.
UNAUDITED PRO FORMA CONDENSED INCOME STATEMENT
NINE MONTHS ENDED SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
----------------------------------
SEPTEMBER 25, 1999 JUNE 30, 1999
------------------ ------------- PRO FORMA
NAVL ALLIED ADJUSTMENTS PRO FORMA
------------------ ------------- ----------- ----------
<S> <C> <C> <C> <C>
Operating revenues.............................. $771,237 $809,784 -- $1,581,021
Cost of services:
Cost of services.............................. 747,256 772,688 (900)(a) 1,516,110
(2,934)(f)
Depreciation and amortization................. 21,083 15,254 10,449 (b) 45,480
(1,306)(e)
-------- -------- --------- ----------
Total operating expenses...................... 768,339 787,942 5,309 1,561,590
-------- -------- --------- ----------
Income from operations.......................... 2,898 21,842 (5,309) 19,431
Interest expense, net......................... 12,395 489 27,932 (c) 43,750
2,934 (f)
Other expenses/(income)....................... 7 7
-------- -------- --------- ----------
Income/(loss) before minority interests and
income taxes.................................. (9,504) 21,353 (36,175) (24,326)
Minority interests in income of subsidiaries.... (179) (179)
-------- -------- --------- ----------
Income/(loss) before income taxes............... (9,683) 21,353 (36,175) (24,505)
Provision/(benefit) for income taxes............ (2,752) 6,194 (11,902)(d) (8,460)
-------- -------- --------- ----------
Net income/(loss)............................... $ (6,931) $ 15,159 $ (24,273) $ (16,045)
======== ======== ========= ==========
</TABLE>
See accompanying notes to Unaudited Pro Forma Condensed Income Statement.
37
<PAGE>
NORTH AMERICAN VAN LINES, INC.
UNAUDITED PRO FORMA CONDENSED INCOME STATEMENT
TWELVE MONTHS ENDED DECEMBER 26, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
NINE MONTHS THREE MONTHS TWELVE MONTHS ENDED
ENDED ENDED ----------------------------
DECEMBER 26, MARCH 28, DECEMBER 26, SEPTEMBER 30,
1998 1998 1998 1998
------------ ------------ CD&R ------------ -------------
PURCHASE PRO
ACCOUNTING ADJUSTED FORMA
NAVL PREDECESSOR ADJUSTMENTS(G) NAVL ALLIED ADJUSTMENTS
------------ ------------ -------------- ------------ ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Operating revenues.............. $759,207 $207,245 $ -- $966,452 $1,152,195 $ --
Cost of services:
Cost of services.............. 725,129 205,685 511 931,325 1,086,360 (1,200)(a)
(4,455)(f)
Depreciation and
amortization................ 22,511 2,895 4,902 30,308 19,305 14,010 (b)
(1,485)(e)
-------- -------- ------- -------- ---------- --------
Total operating expenses...... 747,640 208,580 5,413 961,633 1,105,665 6,870
-------- -------- ------- -------- ---------- --------
Income/(loss) from operations... 11,567 (1,335) (5,413) 4,819 46,530 (6,870)
Interest expense, net......... 11,758 (240) 3,747 15,265 (330) 37,151 (c)
4,455 (f)
Other income.................. (147) (10) -- (157)
-------- -------- ------- -------- ---------- --------
Income/(loss) before minority
interests and income taxes.... (44) (1,085) (9,160) (10,289) 46,860 (48,476)
Minority interests in loss of
subsidiaries.................. (57) (13) -- (70)
-------- -------- ------- -------- ---------- --------
Income/(loss) before income
taxes......................... (101) (1,098) (9,160) (10,359) 46,860 (48,476)
Provision/(benefit) for income
taxes......................... 1,111 (448) (3,515) (2,852) 9,405 (15,964)(d)
-------- -------- ------- -------- ---------- --------
Net income/(loss)............... $ (1,212) $ (650) $(5,645) $ (7,507) $ 37,455 $(32,512)
======== ======== ======= ======== ========== ========
<CAPTION>
PRO
FORMA
RESULTS
-----------
<S> <C>
Operating revenues.............. $ 2,118,647
Cost of services:
Cost of services.............. 2,012,030
Depreciation and
amortization................ 62,138
-----------
Total operating expenses...... 2,074,168
-----------
Income/(loss) from operations... 44,479
Interest expense, net......... 56,541
Other income.................. (157)
-----------
Income/(loss) before minority
interests and income taxes.... (11,905)
Minority interests in loss of
subsidiaries.................. (70)
-----------
Income/(loss) before income
taxes......................... (11,975)
Provision/(benefit) for income
taxes......................... (9,411)
-----------
Net income/(loss)............... $ (2,564)
===========
</TABLE>
See accompanying notes to Unaudited Pro Forma Condensed Income Statement.
38
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED INCOME STATEMENTS
(DOLLARS IN THOUSANDS)
(a) As a result of the Allied acquisition, NFC transferred assets in excess of
assumed liabilities so as to provide for a five-year "funding holiday" for
U.K. pensions. The amounts of $900 for the nine months ended September 25,
1999 and $1,200 for the twelve months ended December 26, 1998 have been
actuarially determined based on projected funding requirements and represent
pension cost reductions resulting from such excess pension assets.
(b) These amounts reflect additional depreciation expense of $4,792 for the nine
months ended September 25, 1999 and $6,468 for the twelve months ended
December 26, 1998, as a result of the preliminary fair values assigned to
property and equipment, and additional goodwill amortization ($5,657 for the
nine months ended September 25, 1999 and $7,542 for the twelve months ended
December 26, 1998) based on estimated goodwill resulting from the Allied
acquisition amounting to $301,694 amortized over 40 years.
(c) The pro forma adjustments to interest expense, net, are based on the pro
forma borrowing amounts and the rates in effect as of the closing of the
Allied acquisition:
<TABLE>
<CAPTION>
NINE MONTHS TWELVE MONTHS
ENDED ENDED
SEPTEMBER 25, DECEMBER 26,
1999 1998
-------------- -------------
<S> <C> <C>
Revolving credit facility--$62,800 and $48,900,
respectively, at 8.59%(1).................... $ 4,046 $ 4,201
Term loan facility tranche A--$150,000 at
8.59%(1)..................................... 9,664 12,885
Term loan facility tranche B--$175,000 at
9.59%(1)..................................... 12,587 16,783
Senior subordinated notes--$150,000 at
13.375%...................................... 15,047 20,063
Other interest income, net..................... (72) (695)
Amortization of deferred debt issuance costs... 2,478 3,304
------- -------
Pro forma interest expense, net................ 43,750 56,541
Elimination of historical interest expense..... 15,818 19,390
------- -------
Pro forma adjustment to interest expense,
net.......................................... $27,932 $37,151
======= =======
</TABLE>
----------------------------
(1) These balances are based on weighted average balances for the period
presented. Interest rates with respect to borrowings under these
facilities are variable. A 0.125% change in interest rates on borrowings
under the new senior credit facility would increase or decrease pro forma
interest expense $355 for the nine months ended September 25, 1999 and
$456 for the twelve months ended December 26, 1998.
(d) The tax effect of the pro forma adjustments to income/(loss) before income
taxes is based on estimated applicable statutory tax rates which are
estimated to be 39.0% in the relevant jurisdictions. The pro forma
adjustments assume that no valuation allowance would be required under
SFAS 109 "Accounting for Income Taxes" and that goodwill is not deductible
for tax purposes.
Undistributed earnings of North American Van Lines' foreign subsidiaries are
generally considered to be indefinitely reinvested and, accordingly, no
provision for U.S. federal and state income taxes has been made. Upon
distribution of those earnings in the form of dividends or otherwise, North
American Van Lines would be subject to other U.S. income taxes (subject to
an adjustment for foreign tax credits) and withholding taxes payable to the
various foreign countries.
39
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED INCOME STATEMENTS (CONTINUED)
(DOLLARS IN THOUSANDS)
(e) Amounts reflect the removal of amortization expenses recognized in respect
of Allied's existing goodwill balances that were written off in conjunction
with pro forma purchase accounting adjustments.
(f) Reclassifications of interest income earned on investments held by Allied's
property and casualty insurance subsidiary were made to conform with NAVL's
financial statement presentation.
(g) Purchase accounting adjustments were recorded to reflect the effects of
purchase accounting from the acquisition of NAVL by Clayton, Dubilier & Rice
Fund V Limited Partnership on March 29, 1998, as if the transaction had
occurred on December 28, 1997. The purchase accounting adjustments primarily
relate to an increase in depreciation resulting from the fair market
valuation of fixed assets acquired, the amortization of goodwill resulting
from the acquisition, the increase in interest expense on debt issued to
finance the acquisition, and the related income tax impact of the
adjustments.
(h) EBITDA for the pro forma periods presented below is generally calculated in
accordance with the definition of that term given in the senior credit
agreement governing our new senior credit facility, using management's
estimate of pro forma insurance expense reductions as further discussed in
note (5) below. It has been calculated as follows:
<TABLE>
<CAPTION>
NINE MONTHS TWELVE MONTHS
ENDED ENDED
SEPTEMBER 25, DECEMBER 26,
1999 1998
-------------- -------------
<S> <C> <C>
Operating earnings before depreciation and
amortization................................. $64,911 $106,617
One-time consulting costs relating to the Fast
Forward Program(1)........................... 3,382 --
Non-recurring charges to rationalize Allied's
U.K. and European operations(2).............. 2,282 2,640
Non-recurring (profit)/loss on disposal of
properties and operations(3)................. (546) (3,795)
One-time executive compensation costs relating
to the sale of NAVL(4)....................... -- 4,612
Pro forma savings of insurance expenses(5)..... 3,830 5,107
------- --------
EBITDA......................................... $73,859 $115,181
======= ========
</TABLE>
----------------------------
(1) NAVL incurred $3,382 of third-party consulting costs during the nine
months ended September, 1999 in connection with its
restructuring/rationalization Fast Forward Program that have been
reflected in the Unaudited Pro Forma Condensed Income Statements.
(2) Allied incurred costs of approximately $2,282 for the nine months ended
June 30, 1999 and approximately $2,640 for the twelve months ended
September 30, 1998 relating to the reduction in personnel-related
expenses and the rationalization of facilities in respect of its U.K. and
European operations.
(3) NAVL realized a loss of $106 on the sale of fixed assets for the nine
months ended September 25, 1999. Allied recorded a gain of $652 for the
nine months ended June 30, 1999 and $3,795 for the twelve months ended
September 30, 1998, relating to the disposal of properties and
operations.
(4) NAVL incurred $4,612 of incremental compensation costs due to contracts
with key executives with incentive provisions to encourage these
executives to remain with NAVL until the
40
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED INCOME STATEMENTS (CONTINUED)
(DOLLARS IN THOUSANDS)
acquisition of NAVL by Clayton, Dubilier & Rice Fund V Limited
Partnership from Norfolk Southern.
(5) The amounts of $3,830 and $5,107 for the nine months ended
September 25, 1999 and for the twelve months ended December 26, 1998,
respectively, represent management's estimate of reductions to insurance
expense, based upon the combined businesses, their respective insurance
loss histories and current market conditions.
EBITDA does not represent and should not be considered as an alternative to
net income or cash flow from operations as determined by generally accepted
accounting principles, and our calculation thereof may not be comparable to
that reported by other companies. We believe that it is widely accepted that
EBITDA provides useful information regarding a company's ability to service
and/or incur indebtedness. EBITDA does not take into account a company's
working capital requirements, debt service requirements and other
commitments and, accordingly, is not necessarily indicative of amounts that
may be available for discretionary use.
41
<PAGE>
SELECTED HISTORICAL FINANCIAL DATA OF NAVL
We derived the selected historical financial data for the years ended 1994
through 1997 and for the three-month period ended March 28, 1998 and for the
nine-month period ended December 26, 1998 from the audited financial statements
of NAVL or its predecessor for the periods then ended. The selected historical
financial data of NAVL as of and for the nine months ended September 25, 1999
and the six months ended September 26, 1998 are derived from the unaudited
interim financial statements of NAVL. The unaudited interim financial statements
reflect all adjustments which, in the opinion of management, are necessary for a
fair statement of the financial condition and results of operations as of and
for the periods presented. Operating results for the interim periods are not
necessarily indicative of the results that may be expected for the full year.
The presentation of selected historical financial data is only a summary and you
should read it together with the historical financial statements and related
notes of NAVL appearing elsewhere in this prospectus.
<TABLE>
<CAPTION>
ANNUAL DATA
----------------------------------------------------------------------------------------
PREDECESSOR(1) NAVL
------------------------------------------------------------------------- -------------
NINE-MONTH
THREE-MONTH PERIOD FROM
PERIOD FROM MARCH 29,
DECEMBER 28, 1998
1997 (INCEPTION)
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED THROUGH THROUGH
DECEMBER 31, DECEMBER 30, DECEMBER 28, DECEMBER 27, MARCH 28, DECEMBER 26,
1994 1995 1996 1997 1998 1998
------------- ------------- ------------- ------------- ------------- -------------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS
DATA(2):
Operating revenues........ $891.4 $895.5 $930.2 $941.5 $207.3 $759.2
Gross profit.............. 192.8 197.4 197.3 199.1 44.9 165.2
Operating expenses........ 170.7 175.1 172.1 173.4 41.6 153.7
Non-recurring items(3).... -- 3.9 (2.9) (5.5) 4.6 --
Income/(loss) from
operations.............. 22.1 18.4 28.1 31.2 (1.3) 11.5
Net income (loss)......... 9.7 13.8 17.5 22.3 (0.7) (1.2)
OTHER DATA:
Net cash provided by (used
for) operating
activities.............. $ 32.7 $ 54.6 $ 39.7 $ 28.9 $ 10.3 $ (1.6)
EBITDA(4)................. 41.6 38.6 37.9 38.2 6.2 34.0
Capital expenditures...... 5.9 6.6 7.4 10.6 1.4 5.7
Agent contract
expenditures(5)......... 3.4 1.5 2.2 9.2 2.2 1.5
Depreciation and
amortization(6)......... 19.5 16.3 12.7 12.5 2.9 22.5
Ratio of earnings to fixed
charges(7).............. 2.52 3.53 5.53 6.61 (0.98) 0.74
BALANCE SHEET DATA (AT END
OF PERIOD):
Cash and cash
equivalents............. $ 8.4 $ 2.3 $ 1.9 $ 2.9 $ 9.2 $ 2.1
Working capital........... 81.5 60.4 55.8 62.0 63.2 31.4
Total assets.............. 336.7 298.2 287.3 302.3 284.3 392.1
Total debt(8)............. 22.1 0.9 0.7 0.7 0.7 168.6
Stockholders' equity...... 89.6 103.6 86.1 108.1 101.0 63.7
<CAPTION>
NINE-MONTH DATA
---------------------------------------------
PREDECESSOR NAVL
------------- ------------------------------
(UNAUDITED)
------------------------------
THREE-MONTH SIX-MONTH
PERIOD FROM PERIOD FROM
DECEMBER 28, MARCH 29, NINE
1997 1998 MONTHS
THROUGH THROUGH ENDED
MARCH 28, SEPTEMBER 26, SEPTEMBER 25,
1998 1998 1999
------------- -------------- --------------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C>
STATEMENT OF OPERATIONS
DATA(2):
Operating revenues........ $207.3 $521.0 $771.2
Gross profit.............. 44.9 113.9 163.6
Operating expenses........ 41.6 102.9 154.8
Non-recurring items(3).... 4.6 -- 5.9
Income/(loss) from
operations.............. (1.3) 11.0 2.9
Net income (loss)......... (0.7) 0.7 (6.9)
OTHER DATA:
Net cash provided by (used
for) operating
activities.............. $ 10.3 $(12.2) $ (1.6)
EBITDA(4)................. 6.2 26.2 29.9
Capital expenditures...... 1.4 4.1 5.5
Agent contract
expenditures(5)......... 2.2 0.8 1.6
Depreciation and
amortization(6)......... 2.9 15.2 21.1
Ratio of earnings to fixed
charges(7).............. (0.98) 0.95 0.16
BALANCE SHEET DATA (AT END
OF PERIOD):
Cash and cash
equivalents............. $ 9.2 $ 3.7 $ 1.2
Working capital........... 63.2 33.8 28.5
Total assets.............. 284.3 414.2 412.9
Total debt(8)............. 0.7 170.0 178.3
Stockholders' equity...... 101.0 65.3 56.8
</TABLE>
- ------------------------
(1) On March 29, 1998, Allied Worldwide (whose majority stockholder is Clayton,
Dubilier & Rice Fund V Limited Partnership), through its wholly owned
subsidiary NA Acquisition, acquired all of the outstanding shares of common
stock of NAVL. On such date, NA Acquisition was merged into NAVL with NAVL
remaining as the surviving corporation and a wholly owned subsidiary of
Allied Worldwide. The acquisition was accounted for as a purchase in
accordance with U.S. GAAP.
The consolidated financial statements for periods prior to March 29, 1998
have been prepared on the historical cost basis using accounting principles
that had been adopted by NAVL's predecessor. After the acquisition by
42
<PAGE>
Clayton, Dubilier & Rice Fund V Limited Partnership of NAVL on March 29,
1998, NAVL changed its accounting basis to recognize estimated revenue and
related transportation expenses when shipments are delivered, the preferred
method under U.S. GAAP. NAVL's predecessor company recognized estimated
revenue and related transportation expenses when shipments were loaded.
Management estimates that the impact of this difference on reporting
operating revenues and income from operations is not material.
(2) Operating revenues in 1998, 1997 and 1996 are derived from audited financial
statements. Operating revenues in 1995 and 1994, which are presented on a
basis consistent with 1998, 1997 and 1996, are based on company internal
reports. Operating revenues for the periods ended September 25, 1999 and
September 26, 1998 are based on unaudited interim financial statements.
Gross profit and operating expenses are derived from audited financial
statements or unaudited interim financial statements. Certain 1998, 1997,
1996, 1995 and 1994 amounts have been reclassified to conform with the 1999
presentation. These reclassifications had no impact on net income.
(3) Unusual and non-recurring operating charges or credits of NAVL or its
predecessor have been included in this line item as follows: (a) in 1999,
NAVL incurred $5.9 million of expense, consisting primarily of incremental
expenses of $3.4 million for professional services in connection with Fast
Forward, a one-time comprehensive productivity review of NAVL's operations
and $2.4 million of restructuring costs for severance related costs,
building lease terminations and losses on the sale of equipment; (b) in
1998, the predecessor incurred incremental compensation due to contracts
with key executives with incentive provisions to encourage them to remain
with the predecessor until a sale of the business was completed; (c) in
1997, the predecessor received payment in settlement of an auto liability
insurance coverage dispute which had been in litigation; (d) in 1996, the
predecessor reversed a portion of a litigation accrual which was first
established in 1993 regarding a breach of contract suit. A portion of the
initial damage award was overturned on appeal; and (e) in 1995, the
predecessor recorded an accrual related principally to the curtailment of
certain operations in Canada and to the closure of a subsidiary operation in
Panama.
(4) EBITDA for the historical periods presented is generally calculated in
accordance with the definition of that term given in the senior credit
agreement governing our new senior credit facility, without taking into
account insurance savings allowable thereunder.
EBITDA does not represent and should not be considered as an alternative to
net income or cash flow from operations as determined by generally accepted
accounting principles, and our calculation thereof may not be comparable to
that reported by other companies. We believe that it is widely accepted that
EBITDA provides useful information regarding a company's ability to service
and/or incur indebtedness. EBITDA does not take into account a company's
working capital requirements, debt service requirements and other
commitments and, accordingly, is not necessarily indicative of amounts that
may be available for discretionary use.
(5) Represents cash outflows to agents to secure long-term contracts.
(6) Includes depreciation expense for property and equipment and amortization
expense for intangible assets and deferred agent contract expenditures.
Excludes amortization expense for deferred debt issuance costs, which are
recorded as part of interest expense.
(7) The ratio of earnings to fixed charges for the years ended December 31,
1994, December 30, 1995, December 28, 1996 and December 27, 1997, for the
three-month period ended March 28, 1998 and for the nine-month period ended
December 26, 1998 includes non-cancellable lease expenses as the basis of
determining the interest component of operating leases. The ratio of
earnings to fixed charges for the six-month period ended September 26, 1998
and for the nine months ended September 25, 1999 includes cancellable and
non-cancellable lease expenses as the basis of determining the interest
component of operating leases.
(8) Total debt consists of long-term debt, current portion of long-term debt,
capital lease obligations, amounts outstanding under the revolving credit
facility and other short-term debt.
43
<PAGE>
SELECTED HISTORICAL FINANCIAL DATA OF ALLIED
We derived the selected historical financial data for the fiscal years ended
September 30, 1996, 1997 and 1998 from the audited combined financial statements
of Allied. The selected historical financial data of Allied as of and for the
nine months ended June 30, 1998 and June 30, 1999 are derived from the unaudited
combined financial statements of Allied for those periods. The unaudited
combined financial statements reflect all adjustments, consisting only of normal
recurring adjustments which, in the opinion of Allied's management, are
necessary for a fair statement of the combined financial condition and results
of operation as of and for the periods presented. Operating results for the
interim periods are not necessarily indicative of the results that may be
expected for the full year. The selected historical financial data is only a
summary and you should read it together with the historical financial statements
and related notes of Allied appearing elsewhere in this prospectus.
<TABLE>
<CAPTION>
TWELVE MONTHS TWELVE MONTHS TWELVE MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, JUNE 30, JUNE 30,
U.K. GAAP(1) 1996 1997 1998 1998 1999
- ------------ -------------- -------------- -------------- ----------- -----------
(IN MILLIONS)
UNAUDITED
-------------------------
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Operating revenues.................. L 658.1 L 680.7 L 698.3 L 486.3 L 496.8
Operating profit before exceptional
items............................. 18.7 21.3 26.1 13.7 13.8
Operating exceptional items......... (3.0) (2.3) (1.6) (1.0) (1.4)
-------- -------- -------- -------- --------
Operating profit.................... 15.7 19.0 24.5 12.7 12.4
Non operating exceptional
items(2).......................... (1.0) 2.3 (0.1) -- 0.4
Interest expense, net............... (0.7) (2.2) 0.2 0.6 (0.3)
Taxation............................ (5.0) (7.2) (4.6) (2.4) (2.9)
Minority interests.................. (0.1) (0.1) -- -- --
-------- -------- -------- -------- --------
Profit for the financial period..... 8.9 11.8 20.0 10.9 9.6
OTHER DATA:
Net cash provided by operations..... L 17.5 L 33.6 L 36.3 L 23.8 L 17.0
EBITDA(3)........................... 28.4 31.7 37.1 22.1 22.6
Capital expenditures................ 9.9 12.2 15.0 11.5 9.1
Depreciation........................ 8.3 8.4 9.0 6.9 7.4
Ratio of earnings to fixed
charges........................... 4.45 3.94 7.46 5.22 3.83
BALANCE SHEET DATA (AT THE END OF
PERIOD):
Cash................................ L -- L 13.9 L 18.0 L 19.4 L 25.9
Working capital..................... -- 31.9 34.2 24.2 39.7
Total assets........................ -- 266.3 281.9 193.0 232.5
Intercompany payable to NFC, net.... -- 47.8 37.8 13.6 168.9
Stockholders' equity................ -- 32.3 49.2 63.6 (63.0)
U.S. GAAP DATA(1)(3)
Operating revenues.................. $1,013.5 $1,109.5 $1,152.2 $ 802.4 $ 809.8
EBITDA(3)........................... 45.9 54.1 64.7 38.8 38.8
Stockholders' equity................ -- 87.3 119.9 142.6 (68.1)
</TABLE>
- ------------------------
(1) The combined financial statements of Allied for the periods presented have
been prepared in accordance with U.K. GAAP, which differs in certain
significant respects from U.S. GAAP. See note 22 of Notes to the Combined
Financial Statements of Allied and note 4 of Notes to the
44
<PAGE>
Condensed Combined Financial Statements of Allied appearing elsewhere in
this prospectus. In anticipation of the Allied acquisition, the historical
financial statements were prepared to show the performance of moving
services businesses and assets of Allied separate from the operations of its
parent, NFC. These historical financial statements were prepared for the
three years ended September 30, 1998 as if the moving services businesses
had been in existence from October 1, 1995. Financial information for Allied
operations is not available for periods prior to October 1, 1995.
(2) Includes profit/(loss) on disposal of properties and loss on disposal of
operations.
(3) EBITDA for the historical periods presented is generally calculated in
accordance with the definition of that term given in the senior credit
agreement governing our new senior credit facility, without taking into
account insurance savings allowable thereunder.
EBITDA does not represent and should not be considered as an alternative to
net income or cash flow from operations as determined by generally accepted
accounting principles, and our calculation thereof may not be comparable to
that reported by other companies. We believe that it is widely accepted that
EBITDA provides useful information regarding a company's ability to service
and/or incur indebtedness. EBITDA does not take into account a company's
working capital requirements, debt service requirements and other
commitments and, accordingly, is not necessarily indicative of amounts that
may be available for discretionary use.
45
<PAGE>
The following table provides a reconciliation of Allied net income,
stockholders' equity and operating income before exceptional items as reported
in U.K. GAAP to U.S. GAAP. Detailed explanations of reconciling items are
located within the NFC Moving Services Group financial statements and related
notes appearing elsewhere in this prospectus.
<TABLE>
<CAPTION>
TWELVE MONTHS TWELVE MONTHS TWELVE MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, JUNE 30, JUNE 30,
1996 1997 1998 1998 1999
------------- ------------- ------------- ----------- -----------
(IN MILLIONS)
<S> <C> <C> <C> <C> <C>
Profit for the financial
period (U.K. GAAP, U.K.
Pounds sterling)............ L 8.9 L 11.8 L 20.0 L 10.9 L 9.6
Profit for the financial
period (U.K. GAAP, U.S.
Dollars).................... $ 13.7 $ 19.2 $ 33.0 $ 18.0 $ 15.7
U.S. GAAP adjustments:
Pension and benefits........ $ 2.2 $ 2.4 $ 3.5 $ 2.3 $ 2.0
Depreciation................ (1.1) (1.6) (1.2) (1.0) (1.0)
Profit on disposal of land
and buildings............. 11.1 (3.6) 4.0 4.0 --
Taxes....................... 11.5 (0.4) (1.8) (1.5) (1.5)
-------- -------- -------- -------- -------
Net income for the financial
period adjusted to U.S.
GAAP........................ $ 37.4 $ 16.0 $ 37.5 $ 21.8 $ 15.2
======== ======== ======== ======== =======
Stockholders' equity (U.K.
GAAP, U.K. Pounds
sterling)................... L -- L 32.3 L 49.2 L 63.6 L (63.0)
Stockholders' equity (U.K.
GAAP, U.S. Dollars)......... $ -- $ 52.3 $ 83.6 $ 106.2 $ (99.5)
U.S. GAAP adjustments:
Intangible assets........... $ -- $ 41.5 $ 42.0 $ 41.6 $ 37.9
Unrealized holding gains on
investments............... $ -- 2.3 0.5 1.5 2.2
Property, plant and
equipment................. $ -- (9.6) (10.8) (10.9) (10.9)
Accounts receivable......... $ -- (3.9) -- -- --
Accruals and deferred
income.................... $ -- (4.7) (4.2) (4.3) (4.0)
Taxes....................... $ -- 9.4 8.8 8.5 6.2
-------- -------- -------- -------- -------
Stockholders' equity adjusted
to U.S. GAAP................ $ -- $ 87.3 $ 119.9 $ 142.6 $ (68.1)
======== ======== ======== ======== =======
</TABLE>
46
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
OVERVIEW
Our operating revenues are derived from the following business segments:
(1) our van line network, (2) our moving and storage services and (3) our
logistics services.
Our van line network segment, which is based in North America and operates
under both the northAmerican and Allied brand names, provides two types of
relocation services: (1) domestic, which provides residential relocation
services in the United States and Canada through a network of exclusive agents
who provide the sales, packing, loading, transportation, delivery and
warehousing services and (2) international, which targets multi-national
companies primarily based in the United States and provides or coordinates
relocation services for residential shipments destined to or originating in
foreign countries using our exclusive agent network in North America and
authorized representatives around the world to complete the service offering.
Our moving and storage services segment operates in the United Kingdom,
Europe and Asia/Pacific through a network of company-owned branches that utilize
the Pickfords or Allied Pickfords brand names. This segment provides complete
domestic and international residential relocation services, including sales,
packing, loading, transportation, delivery and warehousing. The moving and
storage services segment also provides records management and office and
industrial relocation services.
Customers of the van line network and moving and storage services segments
are: (1) corporate accounts, (2) private transferees and (3) government and
military.
Our logistics services segment consists of: (1) logistics solutions, which
includes finished goods and emergency parts distribution, order fulfillment,
project-specific delivery management and the tracking of products through the
supply chain, with a focus on high-value products, (2) specialized
transportation services, which facilitates the movement of computers,
electronics, telecommunications and medical equipment, trade show exhibition
materials, fine art and other products that require specialized transportation,
distribution or delivery solutions and (3) European operations, which handles
logistics solutions and specialized transportation of high-value products to and
from any major city in the United Kingdom and Europe operating under the trade
name midiData-Registered Trademark-.
BUSINESS TRENDS AND INITIATIVES
Our operating income and cash flow from operations are influenced by
industry volume and market share as well as selling prices for our services.
Additionally, they are impacted by the costs and availability of hauling
capacity and by a number of significant business, economic and competitive
factors, many of which are not within our control.
Our van line network segment has historically experienced stable pricing for
its service offerings, although relocation revenues are subject to seasonal
swings and competition from other van lines or service providers for available
shipments. The van line network and its agents primarily use independent
owner/operators to provide hauling capacity and, in general, the industry has
had difficulty in attracting and retaining qualified haulers. NAVL has changed
its residential hauling commission structure in an effort to attract and retain
more qualified haulers and to increase agent hauling capacity during the peak
season.
Our moving and storage services segment has also historically experienced
stable pricing in a competitive market for its services, although relocation
revenues are subject to seasonal swings. This segment has some ability to adjust
pricing, labor and equipment based on demand. This segment is now employing
business development specialists to focus our corporate account sales efforts,
primarily in the areas of international relocations and business moving.
Additionally, the moving and storage services
47
<PAGE>
segment recently acquired an industrial engineering firm to augment its
industrial moving business, increasing the scope of our services in Europe.
Our logistics services segment has also experienced stable pricing. Our
revenues are affected by competition from other van lines and from
less-than-truckload and logistics service providers as well as changes in
business demand for computer, electronics and other specialty products. One of
our largest logistics customers recently indicated that it is considering
alternative suppliers, which will result in its doing less business with us. See
"Business--Customers and Marketing."
We are pursuing a number of long-term initiatives designed to improve
productivity and profitability through programs such as Fast Forward, an
innovative, NAVL-initiated process and efficiency project. In early 1999, a team
of consultants and employees spent approximately six months evaluating NAVL's
business and generated numerous ideas to be implemented across NAVL's
operations. Implementation began in July of 1999 and is expected to be
substantially completed by the end of 2000.
Allied has implemented a select service provider network and compensation
structure aimed at increasing corporate sales volume. Additionally, it has
continued development of its Professional Sales Association training programs
and has enhanced several technological tools designed to attract additional
corporate customers, including a new move management system, enhanced corporate
reporting, on-line claims reporting and enhanced web-site capabilities.
RESULTS OF OPERATIONS--NAVL
NAVL's operating revenues are derived from its van line network and
logistics services segments.
Transportation expenses for the van line network are comprised of the
compensation paid to (1) owner/operators or agent drivers on a predetermined
rate schedule to provide equipment and haul shipments, (2) owner/operators or
agent crews for services such as packing, crating, loading and unloading,
(3) agents for booking, estimating and customer service and (4) other third
parties such as ocean freight carriers for other transportation services.
Transportation expenses for the logistics services segment are comprised of
the following: (1) compensation paid to owner/operators, employee or agent
drivers on a predetermined rate schedule to provide equipment and haul
shipments, (2) compensation paid to owner/operators, employee or agent crews for
services such as pick-up, delivery and installation, (3) facility costs,
including lease expense and labor costs associated with running the
transportation network and (4) sub-contracted transportation expenses in
providing supply chain management services.
Operating expenses include NAVL's consolidated insurance and claims, bad
debt and general and administrative expenses. Employee compensation and benefits
account for over 50% of general and administrative expense. Other significant
components of general and administrative expenses are communication costs, rent,
supplies and other purchased services.
As presented in the Selected Historical Financial Data appearing elsewhere
in this prospectus, NAVL's financial statements reflect operations since its
acquisition by Clayton, Dubilier & Rice Fund V Limited Partnership on March 29,
1998, through September 26, 1998 and through December 26, 1998 and for the nine
months ended September 25, 1999. After its acquisition by Clayton, Dubilier &
Rice Fund V Limited Partnership, in accordance with Emerging Issues Task Force
91-9, "Revenue and Expense Recognition for Freight Services in Process," NAVL
changed its accounting basis to recognize estimated revenue and direct costs
when shipments are delivered. NAVL's predecessor company recognized estimated
revenue and direct costs when shipments were loaded. Management believes the
impact of this difference on reported operating revenues and income from
operations is not material. As a result of purchase accounting, and to conform
to EITF 91-9, accounts receivable and accrued liabilities were reduced by
$16.5 million and $13.0 million, respectively, with a corresponding increase of
$3.5 million to goodwill. The results of operations for the period December 28,
1997 through March 28, 1998 and for the
48
<PAGE>
years ended December 27, 1997 and December 28, 1996 represent the historical
results of operations of NAVL's predecessor prior to the closing of the Clayton,
Dubilier & Rice Fund V Limited Partnership acquisition and under the ownership
of Norfolk Southern Corporation. Solely to facilitate comparison and assessment
of the trends in the results of operations, the following presentation of
results of operations for the nine months ended September 26, 1998 and the year
ended December 26, 1998 was obtained by combining the historical results of
operations of NAVL's predecessor for the period from December 28, 1997 through
March 28, 1998 with (1) the results of operations of NAVL for the period from
March 29, 1998 through September 26, 1998 (the "1998 Nine-Month Period") and
(2) with the results of operations for NAVL for the period from March 29, 1998
through December 26, 1998 (the "1998 Period") adjusted for the effects of
purchase accounting as if the transaction had occurred as of December 28, 1997.
The following table sets forth the percentage relationship of certain items
to operating revenues for NAVL for the periods indicated:
<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED YEAR ENDED 1998 ENDED
DECEMBER 28, DECEMBER 27, 1998 NINE-MONTH SEPTEMBER 25,
1996 1997 PERIOD PERIOD 1999
(PERCENT OF REVENUES) ------------- ------------- -------- ---------- --------------
<S> <C> <C> <C> <C> <C>
Operating revenues:
Van line network................. 56.8% 55.1% 52.7% 53.9% 51.7%
Logistics services............... 43.2% 44.9% 47.3% 46.1% 48.3%
----- ----- ----- ----- -----
Operating revenues................. 100.0% 100.0% 100.0% 100.0% 100.0%
Transportation expenses.......... 78.8% 78.7% 78.3% 78.2% 78.8%
----- ----- ----- ----- -----
Gross profit....................... 21.2% 21.3% 21.7% 21.8% 21.2%
Operating expenses............... 18.5% 18.6% 20.8% 19.9% 20.0%
Non-recurring items.............. (0.3)% (0.6)% 0.4% 0.6% 0.8%
----- ----- ----- ----- -----
Income from operations............. 3.0% 3.3% 0.5% 1.3% 0.4%
Other income (expense)........... 0.0% 0.0% 0.0% 0.0% 0.0%
Interest income (expense)........ (0.1)% 0.1% (1.6)% (1.1)% (1.7)%
----- ----- ----- ----- -----
Income (loss) before taxes......... 2.9% 3.4% (1.1)% 0.2% (1.3)%
Income taxes..................... 1.3% 1.3% (0.3)% (0.2)% 0.4%
Discontinued operations............ 0.3% 0.3% 0.0% 0.0% 0.0%
----- ----- ----- ----- -----
Net income (loss).................. 1.9% 2.4% (0.8)% 0.0% (0.9)%
===== ===== ===== ===== =====
Income from operations:
Van line network................. 1.5% 1.6% 0.2% 0.6% 0.3%
Logistics services............... 1.5% 1.7% 0.3% 0.7% 0.1%
Income from operations............. 3.0% 3.3% 0.5% 1.3% 0.4%
</TABLE>
49
<PAGE>
NINE MONTHS ENDED SEPTEMBER 25, 1999 AS COMPARED TO THE 1998 NINE-MONTH PERIOD
The following table sets forth certain figures regarding NAVL's results of
operations for the nine months ended September 25, 1999, as compared to the 1998
Nine-Month Period which has been adjusted for the effects of purchase accounting
as if the Clayton, Dubilier & Rice Fund V Limited Partnership acquisition had
occurred as of December 28, 1997.
<TABLE>
<CAPTION>
NINE MONTHS % INCREASE
ENDED 1998 (DECREASE)
SEPTEMBER 25, NINE-MONTH FROM
1999 PERIOD PRIOR PERIOD
(DOLLARS IN MILLIONS) -------------- ---------- ------------
<S> <C> <C> <C>
Operating revenues:
Van line network....................... $398.5 $392.8 1.5%
Logistics services..................... 372.7 335.4 11.1%
------ ------
Operating revenues....................... 771.2 728.2 5.9%
Gross profit............................. 163.6 158.7 3.1%
Operating expenses..................... 154.8 144.4 7.2%
Non-recurring items.................... 5.9 4.6 28.3%
------ ------
Income from operations:
Van line network....................... 2.1 4.5 (53.3)%
Logistics services..................... 0.8 5.2 (84.6)%
------ ------
Income from operations................... $ 2.9 $ 9.7 (70.1)%
====== ======
</TABLE>
OPERATING REVENUES. Shipment counts are a measure of activity commonly used
by the transportation industry. The following table represents shipments handled
by NAVL's van line network and logistics services segments. A van line network
shipment is the movement of household goods from the point of origin to the
final destination. Logistics services shipments represent the movement of
truckload or less-than-truckload quantities of products from the point of origin
to the final destination.
<TABLE>
<CAPTION>
NUMBER OF SHIPMENTS
---------------------------
NINE MONTHS
ENDED 1998 % INCREASE
SEPTEMBER 25, NINE-MONTH FROM
1999 PERIOD PRIOR PERIOD
-------------- ---------- ------------
<S> <C> <C> <C>
Van line network:
U.S. and Canada........................ 80,564 80,372 0.2%
International.......................... 20,748 20,327 2.1%
Logistics services:
Specialized transportation............. 265,042 215,318 23.1%
European operations.................... 218,137 198,256 10.0%
</TABLE>
Operating revenues for the nine months ended September 25, 1999 increased
$43.0 million, or 5.9%, compared with the 1998 Nine-Month Period. Operating
revenues in the van line network increased $5.7 million in the nine months ended
September 25, 1999, or 1.5%, to $398.5 million from $392.8 million in the 1998
Nine-Month Period. The increase is due primarily to price gains. Operating
revenues in logistics services increased $37.3 million in the nine months ended
September 25, 1999, or 11.1%, to $372.7 million from $335.4 million in the 1998
Nine-Month Period. The growth is due principally to an increase in shipments
from NAVL's core customer base and incremental logistics programs from new
accounts including Ericsson and MGE.
GROSS PROFIT. Gross profit in the van line network decreased $4.7 million,
or 7.0%, to $63.3 million in the nine months ended September 25, 1999, as
compared to $68.1 million in the 1998 Nine-Month Period, while gross profit
margin decreased to 15.9% in the nine months ended September 25, 1999 from 17.3%
in
50
<PAGE>
the 1998 Nine-Month Period. The decrease in gross profit resulted primarily from
essentially flat sales volume and increased expenses due to changes in the
hauling commission structure.
Gross profit in logistics services increased $9.6 million, or 10.6%, to
$100.3 million in the nine months ended September 25, 1999, as compared to
$90.7 million in the 1998 Nine-Month Period, while gross profit margin decreased
to 26.9% in the nine months ended September 25, 1999 from 27.0% in the 1998
Nine-Month Period. The increase in gross profit resulted principally from
increased sales volume from new accounts.
As a result of the factors described above, gross profit for the nine months
ended September 25, 1999 increased $4.9 million, or 3.1%, to $163.6 million from
$158.7 million in the 1998 Nine-Month Period. The gross profit margin decreased
to 21.2% for the nine months ended September 25, 1999 from 21.8% in the 1998
Nine-Month Period.
OPERATING EXPENSES. Operating expenses increased $10.4 million, or 7.2%, to
$154.8 million in the nine months ended September 25, 1999 as compared to
$144.4 million in the 1998 Nine-Month Period and as a percentage of operating
revenues, increased to 20.0% for the nine months ended September 25 1999 from
19.9% in the 1998 Nine-Month Period. The expense increase is due primarily to
corporate systems expenses, new quality initiatives, an agent conference, the
addition of an internal audit function and new management infrastructure costs,
all of which represent incremental stand-alone expenses not present in the 1998
Nine-Month Period.
NON-RECURRING ITEMS. In the nine months ended September 25, 1999,
non-recurring items totaled $5.9 million of expense, consisting primarily of
$3.4 million of professional services in connection with Fast Forward, a
one-time comprehensive productivity review of NAVL's operations and
$2.4 million of restructuring costs for severance related costs, building lease
terminations and losses on the sale of equipment. In the 1998 Nine-Month Period,
non-recurring items totaled $4.6 million of expense, consisting primarily of
incremental compensation due to contracts with key executives with incentive
provisions to encourage them to remain with NAVL until a sale of the business
was completed. The 1999 expense for the Fast Forward project and the 1998
expense for incremental incentives were incurred by both the van line network
and logistics services segments, while in 1999, a loss on an asset sale was
entirely related to the van line network. These allocations significantly
affected those segments' income from operations as discussed below.
INCOME FROM OPERATIONS. Income from operations in the van line network
decreased $2.4 million, or 53.3%, to $2.1 million in the nine months ended
September 25, 1999, from $4.5 million in the 1998 Nine-Month Period, primarily
as a result of the revenue and expense charges described above.
Income from operations in logistics services decreased $4.4 million to
$0.8 million in the nine months ended September 25, 1999 from $5.2 million in
the 1998 Nine-Month Period, primarily as a result of the revenue and expense
changes described above.
In total, income from operations in the nine months ended September 25, 1999
decreased $6.8 million to $2.9 million from $9.7 million in the 1998 Nine-Month
Period primarily due to incremental stand-alone expenses as a result of the
Clayton, Dubilier & Rice Fund V Limited Partnership acquisition.
INTEREST EXPENSE. Interest expense increased $4.6 million to $12.4 million
in the nine months ended September 25, 1999, from $7.8 million in the 1998
Nine-Month Period, due to increased borrowing on the existing revolving line of
credit.
INCOME TAX EXPENSE. In the nine months ended September 25, 1999, income tax
benefit was $2.8 million. During the 1998 Nine-Month Period, income tax expense
was $1.9 million. This difference results primarily from the increase in pre-tax
loss.
51
<PAGE>
1998 PERIOD AS COMPARED TO YEAR ENDED DECEMBER 27, 1997
The following table sets forth certain figures regarding NAVL's results of
operations for the 1998 Period which have been adjusted for the effects of
purchase accounting as if the Clayton, Dubilier & Rice Fund V Limited
Partnership acquisition had occurred as of December 28, 1997, as compared to the
fiscal year 1997 of NAVL's predecessor, which is unadjusted.
<TABLE>
<CAPTION>
YEAR ENDED % INCREASE
1998 DECEMBER 27, (DECREASE) FROM
PERIOD 1997 PRIOR PERIOD
(DOLLARS IN MILLIONS) -------- ------------- ---------------
<S> <C> <C> <C>
Operating revenues:
Van line network........................ $509.6 $518.6 (1.7)%
Logistics services...................... 456.9 422.9 8.0%
------ ------
Operating revenues........................ 966.5 941.5 2.7%
Gross profit.............................. 210.1 200.6 4.7%
Operating expenses...................... 200.7 174.9 14.8%
Non-recurring items..................... 4.6 (5.5) nm
------ ------
Income from operations:
Van line network........................ $ 1.7 $ 15.4 (89.0)%
Logistics services...................... 3.1 15.8 (80.4)%
------ ------
Income from operations.................... $ 4.8 $ 31.2 (84.6)%
====== ======
</TABLE>
OPERATING REVENUES. Shipment counts are a measure of activity commonly used
by the transportation industry. The following table represents shipments handled
by NAVL's van line network and logistics services segments. A van line network
shipment is the movement of household goods from the point of origin to the
final destination. Logistics services shipments represent the movement of
truckload or less-than-truckload quantities of products from the point of origin
to the final destination.
<TABLE>
<CAPTION>
NUMBER OF SHIPMENTS
------------------------
YEAR ENDED % INCREASE
1998 DECEMBER 27, (DECREASE) FROM
PERIOD 1997 PRIOR PERIOD
-------- ------------- ---------------
<S> <C> <C> <C>
Van line network:
U.S. and Canada........................ 102,250 106,500 (4.0)%
International.......................... 28,500 33,250 (14.3)%
Logistics services:
Specialized transportation............. 319,000 297,750 7.1%
European operations.................... 293,500 241,750 21.4%
</TABLE>
Operating revenues for the 1998 Period increased $25.0 million, or 2.7%,
compared with 1997. Operating revenues in the van line network decreased
$9.0 million in the 1998 Period, or 1.7%, to $509.6 million from $518.6 million
in 1997. The decrease is due primarily to lower shipment activity, partly offset
by an increase in price. Operating revenues in logistics services increased
$34.0 million in the 1998 Period, or 8.0%, to $456.9 million from
$422.9 million in 1997. The increase is due principally to an increase in
shipment activity in specialized transportation services and European operations
as well as new logistics programs for Hewlett Packard and Digital Equipment.
GROSS PROFIT. Gross profit in the van line network decreased $1.6 million,
or 1.8%, to $87.3 million in the 1998 Period as compared to $88.9 million in
1997, while gross profit margin was 17.1% in the 1998 Period as well as in 1997.
The decrease in gross profit resulted primarily from decreased sales volume.
Gross profit in logistics services increased $12.6 million, or 11.4%, to
$122.8 million in the 1998 Period as compared to $110.2 million in 1997, while
gross profit margin increased to 26.9% in the 1998 Period as
52
<PAGE>
compared to 26.1% in 1997. The increase in gross profit resulted principally
from increased sales volume and cost reductions resulting from improved network
utilization.
As a result of the factors described above, gross profit for the 1998 Period
increased $9.5 million, or 4.7%, to $210.1 million from $200.6 million in 1997.
The gross profit margin increased to 21.7% for the 1998 Period from 21.3% in
1997.
OPERATING EXPENSES. Operating expenses increased $25.8 million, or 14.8%,
to $200.7 million in the 1998 Period as compared to $174.9 million in 1997 and
as a percentage of operating revenues, increased to 20.8% in the 1998 Period
from 18.4% in 1997. The increase is due primarily to depreciation relating to
stepped-up costs of acquired fixed assets of $19.6 million and additional
stand-alone expenses such as new management infrastructure costs, professional
services, financing fees and board of director expenses incurred as a result of
the Clayton, Dubilier & Rice Fund V Limited Partnership acquisition.
NON-RECURRING ITEMS. In the 1998 Period, non-recurring items totaled
$4.6 million of expense, consisting primarily of incremental compensation due to
contracts with key executives with incentive provisions to encourage them to
remain with NAVL until a sale of the business was completed. In 1997,
non-recurring items included a gain of $(5.5) million, consisting primarily of a
payment received in settlement of an auto liability insurance coverage dispute
that had been in litigation and the release of fuel tax reserves based on
completion of taxing authority audits. The 1998 expense was incurred by both the
van line network and logistics services segments, while the gain in 1997 was
entirely related to the van line network segment. This allocation significantly
affected those segments' income from operations as reported below.
INCOME FROM OPERATIONS. Income from operations in the van line network
decreased $13.7 million, or 89.0%, to $1.7 million in the 1998 Period from
$15.4 million in 1997, while operating margin decreased to 0.3% in the 1998
Period from 3.0% in 1997, primarily as a result of the revenue and expense
changes described above.
Income from operations in logistics services decreased $12.7 million, or
80.4%, to $3.1 million in the 1998 Period from $15.8 million in 1997, while
operating margin decreased to 0.7% in the 1998 Period from 3.7% in 1997,
primarily as a result of the revenue and expense changes described above.
In total, income from operations in the 1998 Period decreased
$26.4 million, or 84.6%, to $4.8 million from $31.2 million in 1997, while
operating margin decreased to 0.5% in the 1998 Period from 3.3% in 1997 due
primarily to the change in non-recurring items and incremental stand-alone
expenses and purchased asset expenses as a result of the Clayton, Dubilier &
Rice Fund V Limited Partnership acquisition.
INTEREST EXPENSE. Interest expense (income) increased $16.1 million to an
expense of $15.3 million in the 1998 Period from $(0.8) million income in 1997.
The increase in the 1998 Period interest expense is due to the debt associated
with the new capital structure after the Clayton, Dubilier & Rice Fund V Limited
Partnership acquisition.
INCOME TAX EXPENSE. In the 1998 Period, income tax benefit was
$2.9 million on a loss before taxes of $10.4 million. During 1997, NAVL
recognized an income tax expense of $11.9 million on income before taxes of
$31.9 million. These differences are a result of the statutory income tax rate
primarily, in the 1998 Period, due to the book versus tax treatment of certain
items associated with the Clayton, Dubilier & Rice Fund V Limited Partnership
acquisition and, in 1997, because of the reversal of valuation allowances
previously established on net operating loss carry-forward assets at NAVL's
international locations, where the realization of such benefits became more
likely than not.
53
<PAGE>
YEAR ENDED DECEMBER 27, 1997 AS COMPARED TO YEAR ENDED DECEMBER 28, 1996
The following table sets forth certain figures regarding NAVL's
predecessor's results of operations for the fiscal year 1997, as compared to the
fiscal year 1996.
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED % INCREASE
DECEMBER 27, DECEMBER 28, (DECREASE) FROM
1997 1996 PRIOR PERIOD
(DOLLARS IN MILLIONS) ------------- ------------- ---------------
<S> <C> <C> <C>
Operating revenues:
Van line network.................... $518.6 $528.5 (1.9)%
Logistics services.................. 422.9 401.7 5.3%
------ ------
Operating revenues.................... 941.5 930.2 1.2%
Gross profit.......................... 200.6 197.3 1.7%
Operating expenses.................. 174.9 172.1 1.6%
Non-recurring items................. (5.5) (2.9) 89.7%
------ ------
Income from operations:
Van line network.................... $ 15.4 $ 13.7 12.4%
Logistics services.................. 15.8 14.4 9.7%
------ ------
Income from operations................ $ 31.2 $ 28.1 11.0%
====== ====== ====
</TABLE>
OPERATING REVENUES. Shipment counts are a measure of activity commonly used
by the transportation industry. The following table represents shipments handled
by NAVL's van line network and logistics services segments. A van line network
shipment is the movement of household goods from the point of origin to the
final destination. Logistics services shipments represent the movement of
truckload or less-than-truckload quantities of products from the point of origin
to the final destination.
<TABLE>
<CAPTION>
NUMBER OF SHIPMENTS
-----------------------------
YEAR ENDED YEAR ENDED % INCREASE
DECEMBER 27, DECEMBER 28, (DECREASE) FROM
1997 1996 PRIOR PERIOD
------------- ------------- ---------------
<S> <C> <C> <C>
Van line network:
U.S. and Canada..................... 106,500 114,500 (7.0)%
International....................... 33,250 25,759 29.1%
Logistics services:
Specialized transportation.......... 297,750 282,000 5.6%
European operations................. 241,750 207,000 16.8%
</TABLE>
Operating revenues for 1997 increased $11.3 million, or 1.2% compared with
1996. Operating revenues in the van line network decreased $9.9 million in 1997,
or 1.9%, to $518.6 million from $528.5 million in 1996. The decrease is due
primarily to lower shipment activity in domestic relocations, partially offset
by an increase in price. Domestic relocation shipment activity decreased in the
second half of 1997 due in part to the departure of NAVL's largest agent,
Atlantic Moving & Storage, Inc. (based on 1996 line-haul revenue of
approximately $34.8 million for van line network and $24.0 million for logistics
services), from the company agent group (see "Business--Agent Network").
Operating revenues in logistics services increased $21.2 million in 1997, or
5.3%, to $422.9 million from $401.7 million in 1996. The growth is due
principally to an increase in shipment activity in specialized transportation
services, European operations and logistics programs.
GROSS PROFIT. Gross profit in the van line network decreased $1.9 million,
or 2.1%, to $88.9 million from $90.8 million in 1996. Gross profit margin was
relatively flat at 17.1% in 1997 compared to 17.2% in 1996. The slight decrease
in gross profit resulted primarily from decreased sales volume.
54
<PAGE>
Gross profit in logistics services increased $3.7 million, or 3.5%, to
$110.2 million in 1997 as compared to $106.5 million in 1996, while gross profit
margin decreased to 26.1% in 1997 as compared to 26.5% in 1996. The decrease in
gross profit margin resulted principally from costs associated with start-up
activities for a new distribution center and certain logistics programs.
As a result of the factors described above, 1997 gross profit increased in
total $3.3 million, or 1.7%, to $200.6 million from $197.3 million in 1996.
Gross profit margin increased to 21.3% for 1997 from 21.2% in 1996.
OPERATING EXPENSES. Operating expenses increased $2.8 million, or 1.6%, to
$174.9 million in 1997, as compared to $172.1 million in 1996 and, as a
percentage of operating revenues, increased to 18.6% in 1997 from 18.5% in 1996.
NON-RECURRING ITEMS. In 1997, non-recurring items included a gain of
$(5.5) million, consisting primarily of a payment received in settlement of an
auto liability insurance coverage dispute which had been in litigation and the
release of fuel tax reserves based on completion of taxing authority audits. In
1996, non-recurring gains totaled $(2.9) million, consisting primarily of a
partial reversal of a litigation accrual which was first established in 1993
regarding a breach of contract suit. A portion of the initial damage award was
overturned on appeal. Both items related to the van line network and
significantly affected that segment's income from operations as reported below.
INCOME FROM OPERATIONS. Income from operations in the van line network
increased $1.7 million, or 12.4%, to $15.4 million in 1997 from $13.7 million in
1996, while operating margin increased to 3.0% in 1997 from 2.6% in 1996,
primarily as a result of the revenue and expense changes described above.
Income from operations in logistics services increased $1.4 million, or
9.7%, to $15.8 million in 1997 from $14.4 million in 1996, while operating
margin increased to 3.7% in 1997 from 3.6% in 1996, primarily as a result of the
revenue and expense changes described above.
In total, income from operations in 1997 increased $3.1 million, or 11.0%,
to $31.2 million from $28.1 million in 1996, while the operating margin
increased to 3.3% in 1997 from 3.0% in 1996.
INTEREST EXPENSE. For 1997 and 1996, interest was charged to NAVL based
upon the net intercompany payable to Norfolk Southern, its parent company. The
intercompany account was a liability in 1996 versus being a net receivable in
1997. Furthermore, NAVL received interest income as part of the settlement of
litigation referenced in "Non-recurring Items" above.
INCOME TAX EXPENSE. In 1997, income tax expense was $11.9 million, or 37.3%
of income before taxes, compared to $12.2 million, or 44.7% of income before
taxes in 1996. These expenses differ from the statutory income tax rate
primarily because of changes in both current provision rates for international
operations and a reduction of valuation allowances previously established on net
operating loss carry-forward assets at NAVL's international locations, where the
realization of such benefits became more likely in 1997.
RESULTS OF OPERATIONS--ALLIED
Allied's operating revenues are derived from its van line network, moving
and storage services and logistics services segments.
Operating expenses include transportation expenses, insurance, claims and
general and administrative expenses.
Transportation expenses for the van line network are comprised of the
compensation to (1) agents on a predetermined rate schedule to provide equipment
and hauling services and other services such as crating, packing, loading and
unloading, (2) agents for booking, estimating and customer service and
(3) other third parties such as ocean freight carriers for other transportation
services.
55
<PAGE>
Transportation expenses for the moving and storage services segment are
similar to those in the van line network, except that expenses incurred to
provide moving and storage services are largely in the form of direct labor and
equipment expenses rather than in the form of agent expenses.
Transportation expenses for the logistics services segment are comprised of
(1) compensation paid to owner/operators or employee or agent drivers on a
predetermined rate schedule to provide equipment and haul shipments,
(2) compensation paid to owner/operators or agent crews for services such as
pick-up, delivery and installation and (3) agent costs incurred with running the
transportation network.
The financial information included below is prepared on the basis of U.K.
GAAP and reported in Pounds sterling. Such principles differ from U.S. GAAP in
the following significant areas: deferred taxation, disposal of property,
revaluation of land and buildings, reorganization costs, staff costs, pension
costs, investments, goodwill and exceptional items. Allied recognizes revenues
on a loaded basis. Similar to NAVL, the impact of changing to a delivered basis
of accounting on operating revenues and income from operations is not expected
to be material. The calculation of this change, including the impact on accounts
receivable, accrued liabilities and goodwill has not yet been completed.
The following table sets forth the percentage relationship of certain items
to operating revenues for Allied for the periods indicated. Interest income from
Allied's insurance affiliate, TransGuard Insurance Company of America, Inc., is
reflected in Allied's financial statements within interest (net).
<TABLE>
<CAPTION>
NINE MONTHS NINE MONTHS
YEAR ENDED YEAR ENDED YEAR ENDED ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, JUNE 30, JUNE 30,
1996 1997 1998 1998 1999
(PERCENT OF REVENUES) -------------- -------------- -------------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Operating revenues:
Van line network.............. 66.2% 65.6% 66.2% 64.7% 63.9%
Logistics services............ 6.1% 6.2% 6.5% 6.9% 7.3%
Moving and storage services... 27.7% 28.2% 27.3% 28.4% 28.8%
----- ----- ----- ----- -----
Operating revenues.............. 100.0% 100.0% 100.0% 100.0% 100.0%
Operating expenses before
exceptional items........... 97.2% 96.9% 96.3% 97.2% 97.2%
----- ----- ----- ----- -----
Operating profit before
exceptional items............. 2.8% 3.1% 3.7% 2.8% 2.8%
Operating exceptional items... (0.4)% (0.3)% (0.2)% (0.2)% (0.3)%
----- ----- ----- ----- -----
Total operating profit.......... 2.4% 2.8% 3.5% 2.6% 2.5%
Non-operating exceptional
items....................... (0.2)% 0.3% 0.0% 0.0% 0.1%
Interest income (expense)..... (0.1)% (0.3)% 0.0% 0.1% (0.1)%
----- ----- ----- ----- -----
Income before taxes............. 2.1% 2.8% 3.5% 2.7% 2.5%
Income taxes.................. 0.7% 1.1% 0.6% (0.5)% (0.6)%
----- ----- ----- ----- -----
Net income...................... 1.4% 1.7% 2.9% 2.2% 1.9%
===== ===== ===== ===== =====
Operating profit before
operating exceptional items:
Van line network.............. 1.2% 1.1% 1.3% 0.7% 0.7%
Logistics services............ 0.0% 0.0% 0.0% 0.0% 0.0%
Moving and storage services... 1.6% 2.0% 2.4% 2.1% 2.1%
----- ----- ----- ----- -----
Operating profit before
exceptional items............. 2.8% 3.1% 3.7% 2.8% 2.8%
===== ===== ===== ===== =====
</TABLE>
56
<PAGE>
NINE MONTHS ENDED JUNE 30, 1999 AS COMPARED TO NINE MONTHS ENDED JUNE 30, 1998
The following table sets forth certain figures regarding Allied's results of
operations for the nine months ended June 30, 1999, as compared to the nine
months ended June 30, 1998.
<TABLE>
<CAPTION>
NINE MONTHS NINE MONTHS % INCREASE
ENDED ENDED (DECREASE) FROM
JUNE 30, 1999 JUNE 30, 1998 PRIOR PERIOD
(POUNDS IN MILLIONS) -------------- -------------- ---------------
<S> <C> <C> <C>
Operating revenues:
Van line network.................... L 317.4 L 314.3 1.0%
Logistics services.................. 36.5 33.7 8.3%
Moving and storage services......... 142.9 138.3 3.3%
-------------- --------------
Operating revenues.................... 496.8 486.3 2.2%
Operating expenses before exceptional
items............................... 483.0 472.6 2.2%
-------------- --------------
Operating profit before exceptional
items............................... 13.8 13.7 0.7%
-------------- --------------
Operating exceptional items........... (1.4) (1.0) 40.0%
-------------- --------------
Total operating profit................ 12.4 12.7 (2.4)%
-------------- --------------
Operating profit before exceptional
items(1):
Van line network.................... 3.4 3.6 (5.6)%
Logistics services.................. 0.2 (0.2) nm
Moving and storage services......... 10.2 10.3 (1.0)%
-------------- --------------
L 13.8 L 13.7 0.7%
============== ==============
</TABLE>
- ------------------------
(1) Operating profit before exceptional items does not include interest income
from Allied's insurance affiliate, which was L1.8 million and L2.5 million
in the nine months ended June 30, 1999 and 1998, respectively.
OPERATING REVENUES. Shipment counts are a measure of activity commonly used
by the transportation industry. The following table represents shipments handled
by Allied's van line network and logistics services segments. A van line network
shipment is the movement of household goods from the point of origin to the
final destination. Logistics services shipments represent the movement of
truckload or less-than-truckload quantities of products from the point of origin
to the final destination. Moving and storage services, which are located outside
of North America (principally the United Kingdom and Australia), generate
revenues approximately evenly divided among three major activities: domestic
moving, international moving and business moving services. While shipments are
an indicator of revenue in residential moving, aggregate shipment counts for our
moving and storage services segment are not routinely prepared and therefore are
not provided.
<TABLE>
<CAPTION>
NUMBER OF SHIPMENTS
-------------------------------
NINE MONTHS NINE MONTHS % INCREASE
ENDED ENDED (DECREASE) FROM
JUNE 30, 1999 JUNE 30, 1998 PRIOR PERIOD
-------------- -------------- ---------------
<S> <C> <C> <C>
Van line network:
U.S. and Canada..................... 110,019 114,973 (4.3)%
International....................... 17,855 18,859 (5.3)%
Logistics services.................... 67,795 64,250 5.5%
</TABLE>
Operating revenues from the van line network increased L3.1 million, or
1.0%, to L317.4 million for the nine months ended June 30, 1999, as compared to
L314.3 million for the same period in 1998. The
57
<PAGE>
increase is due principally to international account activities and improvements
in the private transferee market, partially offset by a decline in both domestic
and international military activities and reduced domestic corporate account
volumes.
Operating revenues from logistics services increased L2.8 million, or 8.3%,
to L36.5 million for the nine months ended June 30, 1999, as compared to
L33.7 million for the same period in 1998. This increase is principally due to
shipment growth.
Operating revenues from moving and storage services increased L4.6 million,
or 3.3%, to L142.9 million for the nine months ended June 30, 1999, as compared
to L138.3 million in the same period in 1998. International activity continued
to increase in all markets, while domestic moving activity declined slightly in
the United Kingdom and increased in Australia.
In total, operating revenues for the nine months ended June 30, 1999
increased L10.5 million, or 2.2%, to L496.8 million as compared to
L486.3 million in the same period in 1998, as a result of the factors described
above.
OPERATING PROFIT BEFORE EXCEPTIONAL ITEMS. Operating profit before
exceptional items in the van line network decreased L0.2 million, or 5.6%, to
L3.4 million in the nine months ended June 30, 1999 as compared to L3.6 million
in the same period of 1998. Operating margin was unchanged at 1.1% in the nine
months ended June 30, 1999 from the same period of 1998. The nine months ended
June 30, 1999, however, includes costs of L1.3 million, an increase of
L0.5 million over the same period in 1998 as a result of information technology
investment for an on-going process improvement project.
Operating profit before exceptional items in logistics services increased
L0.4 million in the nine months ended June 30, 1999, to L0.2 million, as
compared to L(0.2) million for the same period of 1998. This improvement
reflects the increase in volume as operating margin was 0.5% in the nine months
ended June 30, 1999, as compared to (0.6)% in the same period of 1998.
Operating profit before exceptional items in moving and storage services
decreased L0.1 million, or 1.0%, to L10.2 million in the nine months ended
June 30, 1999 as compared to L10.3 million in the same period of 1998. Operating
margin decreased to 7.1% in the nine months ended June 30, 1999 from 7.4% in the
same period of 1998. The results are primarily attributable to lower revenue
levels in the U.K. domestic business.
In total, as a result of the factors described above, operating profit
before exceptional items in the nine months ended June 30, 1999 increased
L0.1 million, or 0.7%, to L13.8 million as compared to L13.7 million in the same
period of 1998. Operating margin was unchanged at 2.8% in the nine months ended
June 30, 1999 from the same period of 1998.
OPERATING EXCEPTIONAL ITEMS. Operating exceptional items totaled
L1.4 million of expense in the nine months ended June 30, 1999 as compared to
L1.0 million in the same period of 1998, consisting primarily of additional
restructuring expenses principally related to overhead reductions and
rationalization of property in the United Kingdom and continental Europe.
TOTAL OPERATING PROFIT. Primarily as a result of the factors discussed
above, total operating profit in the nine months ended June 30, 1999 decreased
L0.3 million, or 2.4%, to L12.4 million as compared to L12.7 million in the same
period of 1998, while the operating margin declined to 2.5% in the nine months
ended June 30, 1999 from 2.6% in the same period of 1998.
INTEREST. Interest expense increased L0.9 million to L0.3 million net
interest expense in the nine months ended June 30, 1999 as compared to
L0.6 million net interest income in the same period of 1998.
INCOME TAX EXPENSE. In the nine months ended June 30, 1999, income tax
expense increased L0.5 million, or 20.8%, to L2.9 million as compared to
L2.4 million in the same period of 1998. These
58
<PAGE>
expenses differ primarily due to the group's effective rate of tax on profit
from ordinary activities, the tax effects of exceptional items and prior-year
adjustments.
YEAR ENDED SEPTEMBER 30, 1998 AS COMPARED TO YEAR ENDED SEPTEMBER 30, 1997
The following table sets forth certain figures regarding Allied's results of
operations for the fiscal year 1998, as compared to the fiscal year 1997.
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED % INCREASE
SEPTEMBER 30, SEPTEMBER 30, (DECREASE) FROM
1998 1997 PRIOR PERIOD
(POUNDS IN MILLIONS) -------------- -------------- ---------------
<S> <C> <C> <C>
Operating revenues:
Van line network................... L 462.0 L 446.8 3.4%
Logistics services................. 45.3 42.1 7.6%
Moving and storage services........ 191.0 191.8 (0.4)%
-------------- --------------
Operating revenues................... L 698.3 L 680.7 2.6%
Operating expenses before exceptional
items.............................. 672.2 659.4 1.9%
-------------- --------------
Operating profit before exceptional
items.............................. 26.1 21.3 22.5%
Operating exceptional items.......... (1.6) (2.3) (30.4)%
-------------- --------------
Total operating profit............... 24.5 19.0 28.9%
Operating profit before exceptional
items(1):
Van line network................... L 9.4 L 7.9 19.0%
Logistics services................. (0.3) (0.2) 50.0%
Moving and storage services........ 17.0 13.6 25.0%
-------------- --------------
L 26.1 L 21.3 22.5%
</TABLE>
- ------------------------
(1) Operating profit before exceptional items does not include interest income
from Allied's insurance affiliate, which was L2.7 million and L2.0 million
in the years ended September 30, 1998 and 1997, respectively.
OPERATING REVENUES. Shipment counts are a measure of activity commonly used
by the transportation industry. The following table represents shipments handled
by Allied's van line network and logistics services segments. A van line network
shipment is the movement of household goods from the point of origin to the
final destination. Logistics services shipments represent the movement of
truckload or less-than-truckload quantities of products from the point of origin
to the final destination. Moving and storage services, which are located outside
of North America (principally the United Kingdom and Australia), generate
revenues approximately evenly divided among three major activities: domestic
moving, international moving and business moving services. While shipments are
an indicator of revenue in residential moving, aggregate shipment counts for our
moving and storage services segment are not routinely prepared and therefore are
not provided.
<TABLE>
<CAPTION>
NUMBER OF SHIPMENTS
-------------------------------
YEAR ENDED YEAR ENDED % INCREASE
SEPTEMBER 30, SEPTEMBER 30, (DECREASE) FROM
1998 1997 PRIOR PERIOD
-------------- -------------- ---------------
<S> <C> <C> <C>
Van line network:
U.S. and Canada.................... 165,617 169,903 (2.5)%
International...................... 27,468 24,523 12.0%
Logistics services................... 84,249 76,259 10.5%
</TABLE>
59
<PAGE>
Operating revenues in the van line network increased L15.2 million, or 3.4%,
to L462.0 million in 1998 as compared to L446.8 million in 1997. The increase is
due primarily to price increases across a consistent volume base, offsetting a
volume decline principally in Canadian military shipments.
Operating revenues in logistics services increased L3.2 million, or 7.6%, to
L45.3 million in 1998 as compared to L42.1 million in 1997. The increase is due
principally to increased shipment activity in specialized transportation
services.
Operating revenues in moving and storage services decreased L0.8 million, or
0.4%, to L191.0 million in 1998, as compared to L191.8 million in 1997. The
decrease is a net result of marginal positive revenue improvements in all
segments except U.K. domestic moving, which was impacted by softness in the U.K.
moving market.
In total, as a result of the factors described above, operating revenues for
1998 increased L17.6 million, or 2.6%, to L698.3 million as compared to
L680.7 million in 1997.
OPERATING PROFIT BEFORE EXCEPTIONAL ITEMS. Operating profit before
exceptional items in the van line network increased L1.5 million, or 19.0%, to
L9.4 million in 1998, as compared to L7.9 million in 1997, while operating
profit margin improved to 2.0% in 1998 from 1.8% in 1997. The increase in
operating profit resulted primarily from improvements in price and reductions in
claims expense. The results also included a one-time benefit of L1.0 million in
U.S. retirement program costs partially offset by the start-up costs of Meridian
Mobility Resources (Allied's captive third-party relocation service subsidiary)
and the development of the information technology to support business process
improvement.
Operating loss before exceptional items in logistics services increased
L0.1 million, or 50.0%, to L0.3 million in 1998, as compared to L0.2 million in
1997, while its operating profit margin declined to (0.7)% in 1998 compared to
(0.5)% in 1997. The decrease in operating profit resulted principally from
increased transportation expenses.
Operating profit before exceptional items in moving and storage services
increased L3.4 million, or 25.0%, to L17.0 million in 1998, as compared to
L13.6 million in 1997, while operating profit margin improved to 8.9% in 1998
from 7.1% in 1997. The increase in operating profit is primarily due to better
utilization of resources, lower costs arising from more efficient workload
management and lower overhead as a result of a restructuring program implemented
in mid-1997.
In total, as a result of the factors described above, operating profit
before exceptional items for 1998 increased L4.8 million, or 22.5%, to
L26.1 million in 1998 as compared to L21.3 million in 1997, while operating
profit margin increased to 3.7% in 1998 from 3.1% in 1997.
OPERATING EXCEPTIONAL ITEMS. Exceptional reorganization costs were
L1.6 million in 1998, primarily due to costs in relation to the restructuring
initiative commenced in 1997, compared to L2.3 million in 1997.
TOTAL OPERATING PROFIT. Primarily as a result of the factors discussed
above, total operating profit increased L5.5 million, or 28.9%, to
L24.5 million in 1998 as compared to L19.0 million in 1997, while the operating
margin increased to 3.5% in 1998 from 2.8% in 1997.
NON-OPERATING EXCEPTIONAL ITEMS. In 1998 non-operating exceptional items
comprised a loss of L0.3 million arising from the disposal of operations, partly
offset by a profit of L0.2 million arising on the disposal of properties. In
1997 there was a profit of L2.3 million arising from the disposal of properties.
INTEREST. Interest income increased L2.4 million, or 109.1%, to
L0.2 million net interest income in 1998, as compared to L2.2 million net
interest expense in 1997, primarily due to lower levels of net borrowings during
the year following the disposals of property.
INCOME TAX EXPENSE. In 1998, income tax expense was L4.6 million or 18.7%
of income before taxes as compared to L7.2 million, or 37.7% of income before
taxes in 1997. These expenses differ primarily due to a higher level of
adjustments relating to prior years in 1998.
60
<PAGE>
YEAR ENDED SEPTEMBER 30, 1997 AS COMPARED TO YEAR ENDED SEPTEMBER 30, 1996
The following table sets forth certain figures regarding Allied's results of
operations for the fiscal year 1997, as compared to the fiscal year 1996.
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED % INCREASE
SEPTEMBER 30, SEPTEMBER 30, (DECREASE) FROM
1997 1996 PRIOR PERIOD
(POUNDS IN MILLIONS) -------------- -------------- ---------------
<S> <C> <C> <C>
Operating revenues:
Van line network....................... L446.8 L435.7 2.5%
Logistics services..................... 42.1 39.9 5.5%
Moving and storage services............ 191.8 182.5 5.1%
------ ------
Operating revenues....................... L680.7 L658.1 3.4%
Operating expenses before exceptional
items(1)............................... 659.4 639.4 3.1%
------ ------
Operating profit before exceptional
items.................................. 21.3 18.7 13.9%
Operating exceptional items.............. (2.3) (3.0) (23.3)%
------ ------
Total operating profit................... 19.0 15.7 21.0%
Operating profit before exceptional
items:
Van line network....................... L 7.9 L 8.1 (2.5)%
Logistics services..................... (0.2) (0.3) (33.3)%
Moving and storage services............ 13.6 10.9 24.8%
------ ------
L 21.3 L 18.7 13.9%
====== ======
</TABLE>
- ------------------------
(1) Operating profit before exceptional items does not include interest income
from Allied's insurance affiliate, which was L2.0 million and L1.6 million
in the years ended September 30, 1997 and 1996, respectively.
OPERATING REVENUES. Shipment counts are a measure of activity commonly used
by the transportation industry. The following table represents shipments handled
by Allied's van line network and logistics services segments. A van line network
shipment is the movement of household goods from the point of origin to the
final destination. Logistics services shipments represent the movement of
truckload or less-than-truckload quantities of products from the point of origin
to the final destination. Moving and storage services, which are located outside
of North America (principally the United Kingdom and Australia), generate
revenues approximately evenly divided among three major activities: domestic
moving, international moving and business moving services. While shipments are
an indicator of revenue in residential moving, aggregate shipment counts for our
moving and storage services segment are not routinely prepared and therefore are
not provided.
<TABLE>
<CAPTION>
NUMBER OF SHIPMENTS
-------------------------------
YEAR ENDED YEAR ENDED % INCREASE
SEPTEMBER 30, SEPTEMBER 30, (DECREASE) FROM
1997 1996 PRIOR PERIOD
-------------- -------------- ---------------
<S> <C> <C> <C>
Van line network:
U.S. and Canada.................... 169,903 161,974 4.9%
International...................... 24,523 22,033 11.3%
Logistics services................... 76,259 68,166 11.9%
</TABLE>
Operating revenues in the van line network increased L11.1 million, or 2.5%,
to L446.8 million in 1997, as compared to L435.7 million in 1996. The increase
is due primarily to increases in shipment volume.
61
<PAGE>
Operating revenues in logistics services increased L2.2 million, or 5.5%, to
L42.1 million in 1997, as compared to L39.9 million in 1996. The increase is due
principally to increased shipment activity in specialized transportation
services, offset by a decline in the average revenue per shipment due to smaller
shipments.
Operating revenues in moving and storage services increased L9.3 million, or
5.1%, to L191.8 million in 1997, as compared to L182.5 million in 1996. The
increase is primarily a result of increased volumes across all segments.
In total, as a result of the factors described above, operating revenues
increased L22.6 million, or 3.4%, to L680.7 million in 1997, as compared to
L658.1 million in 1996.
OPERATING PROFIT BEFORE EXCEPTIONAL ITEMS. Operating profit before
exceptional items in the van line network decreased L0.2 million, or 2.5%, to
L7.9 million in 1997 as compared to L8.1 million in 1996. Operating profit
margin declined to 1.8% in 1997 from 1.9% in 1996.
Operating loss before exceptional items in logistics services improved
L0.1 million, or 33.3%, to L0.2 million in 1997 as compared to L0.3 million in
1996. Operating profit margin increased to (0.5)% in 1997, as compared to (0.7)%
in 1996. The decrease in operating loss resulted principally from volume
increases and a continued focus on service improvements and cost reduction.
Operating profit before exceptional items in moving and storage services
increased L2.7 million, or 24.8%, to L13.6 million in 1997 as compared to
L10.9 million in 1996. Operating profit margin increased to 7.1% in 1997 from
6.0% in 1996. The increase in operating profit resulted primarily from volume
improvements and lower overhead as a result of a restructuring program
implemented in the middle of 1997.
In total, as a result of the factors described above, 1997 operating profit
increased L2.6 million, or 13.9%, to L21.3 million in 1997 as compared to
L18.7 million in 1996. Operating profit margin increased to 3.1% for 1997 from
2.8% in 1996 as a result of the factors described above.
OPERATING EXCEPTIONAL ITEMS. Exceptional reorganization costs were
L2.3 million in 1997, primarily relating to a strategic restructuring initiative
in the United Kingdom and continental Europe, compared to L3.0 million in 1996.
TOTAL OPERATING PROFIT. Primarily as a result of the factors discussed
above, total operating profit increased L3.3 million, or 21.0%, to
L19.0 million in 1997 as compared to L15.7 million in 1996. Operating margin
increased to 2.8% in 1997 from 2.4% in 1996.
NON-OPERATING EXCEPTIONAL ITEMS. In 1997 these comprised a profit of
L2.3 million arising from the disposal of properties. In 1996 there was a loss
of L1.0 million arising from the disposal of properties.
INTEREST. Interest expense increased L1.5 million, or 14.3%, to
L2.2 million in 1997 as compared to L0.7 million in 1996. The increase in 1997
interest expense is due largely to an increase in net borrowings.
INCOME TAX EXPENSE. In 1997, income tax expense was L7.2 million, or 37.7%,
of income before taxes, compared to L5.0 million, or 35.7% of income before
taxes in 1996. These expenses differ primarily due to a higher level of
adjustments relating to prior years in 1996.
FINANCIAL CONDITION
LIQUIDITY AND CAPITAL RESOURCES
We broadly define liquidity as our ability to generate sufficient cash flow
from operating activities to meet our obligations and commitments. In addition,
liquidity includes the ability to obtain appropriate debt and equity financing
and to convert into cash those assets that are no longer required to meet
existing
62
<PAGE>
strategic and financial objectives. Therefore, liquidity cannot be considered
separately from capital resources that consist of current or potentially
available funds for use in achieving long-range business objectives and meeting
debt service commitments.
Our liquidity needs will arise primarily from debt service on the
substantial indebtedness incurred in connection with the Allied acquisition,
from the funding of working capital and capital expenditures and the
non-recurring cost of the implementation of the entire Fast Forward program and
the cost of integrating the NAVL and Allied businesses (which costs (excluding
capital expenditures) are expected to be approximately $15.0 million), although
these costs are expected to be offset entirely by the savings expected to result
from Fast Forward and synergies arising as a result of the combination of NAVL
and Allied. See "Business--Business and Growth Strategy."
DEBT SERVICE. Principal and interest payments under the new senior credit
facility and interest payments on the notes will represent significant liquidity
requirements for us. Giving pro forma effect to the Allied acquisition, as of
September 25, 1999, we had approximately $537.3 million of indebtedness
comprised of indebtedness for borrowed money and capital leases, consisting of
the $150.0 million principal amount of the notes, $325.0 million outstanding
under our new term loans (consisting of two term loans amounting to
$150.0 million and $175.0 million, respectively) and approximately
$60.4 million outstanding under our new $150.0 million revolving credit facility
and $1.9 million of other debt. As a result, our interest expense will be
substantially higher than in prior periods, and we will be required to devote a
substantial amount of our cash flow to service this indebtedness. We will be
required to repay our $150.0 million tranche A term loan in quarterly principal
payments over seven years and our $175.0 million tranche B term loan in
quarterly principal payments over eight years. We will be required to repay any
amounts borrowed under the revolving credit facility by the seventh anniversary
of the initial borrowings under the new senior credit facility. See "Description
of Other Indebtedness--Senior Credit Facility." All borrowings under the new
senior credit facility bear interest at floating rates based upon the interest
rate option elected by us.
COVENANT RESTRICTIONS. The new senior credit facility imposes restrictions
on our ability to make capital expenditures and the new senior credit facility,
the indenture governing the notes and the agreements governing Allied
Worldwide's $35.0 million of senior discount debt limit our ability to incur
additional indebtedness. Such restrictions could limit our ability to respond to
certain market conditions, to meet our capital spending program, to provide for
unanticipated capital investments or to take advantage of business
opportunities. The covenants in the new senior credit facility also, among other
things, restrict our ability to dispose of assets, incur guarantee obligations,
prepay other indebtedness, make restricted payments, create liens, make equity
or debt investments, make acquisitions, modify terms of the indenture, engage in
mergers or consolidations, change the business conducted by us, make capital
expenditures or engage in certain transactions with affiliates. See "Description
of Other Indebtedness--Senior Credit Facility--Covenants and Events of Default."
The indenture and the agreements governing Allied Worldwide's $35.0 million of
senior discount debt contain a number of similar restrictions. See "Description
of Notes" and "Description of Other Indebtedness--Allied Worldwide Senior
Discount Debt."
CAPITAL AND AGENT CONTRACT EXPENDITURES. NAVL's historical capital
expenditures since 1996 have been $7.4 million, $10.6 million and $7.1 million
for 1996, 1997 and 1998 respectively, and in substantial part result from the
purchase of transportation, terminal and distribution equipment and investments
in systems technologies. NAVL also leases a portion of its long-haul trailer
fleet under operating leases. We converted $13.0 million of these leases to
capital leases in the fourth quarter of 1999. We anticipate using capital leases
for our fleet where available and more cost effective. Allied's historical
capital expenditures since 1996 have been $15.2 million, $19.9 million and
$24.8 million for 1996, 1997 and 1998 respectively, and in substantial part
result from the purchase of transportation, terminal and distribution equipment
and investments in systems technologies. Expenditures for 1999 were
approximately $39.5 million for the
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combined company, relate primarily to the items mentioned above, and do not
include the possible use of capital leases. The increase over 1998 relates to
additional equipment required for moving and storage services and for additional
logistics systems expenditures. We estimate that capital expenditures for 2000
will be approximately $47.0 million and this incremental spending relates
primarily to the integration of NAVL and Allied systems.
In the van lines network, both NAVL and Allied commit to certain payments to
agents as an incentive either to convert from a competing van line or to renew
or otherwise enter into long-term contracts with the van line. NAVL's historical
agent contract expenditures since 1996 have averaged approximately $2.6 million
annually (not considering certain unusual expenditures caused by the departure
of NAVL's largest agent in 1997). Allied's historical agent contract
expenditures since 1996 have averaged approximately $3.0 million annually.
Expenditures for 1999 are estimated to be approximately $6.0 million for the
combined company. We estimate that agent contract expenditures for 2000 will be
at similar levels.
FINANCING SOURCES. As of December 31, 1999, $85.0 million was available
under the new revolving credit facility entered into in connection with the
Allied acquisition to meet our future working capital and other business needs.
We believe that cash generated from operations, together with amounts available
under the revolving credit facility and any other available sources of liquidity
will be adequate to permit us to meet our debt services obligations, capital
expenditure program requirements, ongoing operating costs and working capital
needs for at least the next twelve months, although no assurance can be given in
this regard. Our future operating performance and ability to service or
refinance the notes and to repay, extend or refinance the new senior credit
facility will be, among other things, subject to future economic conditions and
to financial, business and other factors, many of which are beyond our control.
FOREIGN CURRENCY TRANSLATION
The following is a historical discussion of currency translations for NAVL
and Allied. The future magnitude and direction of the adjustments described
depends on the relationship of the U.S. Dollar to other foreign currencies. The
effects of foreign currency fluctuations in our foreign operations are somewhat
mitigated by the fact that the majority of expenses are incurred in the same
currency in which corresponding revenues are generated.
NAVL
Operating revenues from operations outside of the United States during the
nine months ended September 25, 1999, amounted to approximately $59.4 million,
or 7.7% of NAVL's combined operating revenues. At September 25, 1999,
approximately 5.0% of NAVL's total net assets were denominated in currencies
other than the U.S. Dollar. The functional currency for NAVL's international
subsidiaries is the local currency for the country in which the subsidiaries own
their primary assets. NAVL has operations in countries that use the Canadian
dollar, the British Pound sterling or the German Mark as their functional
currencies.
The translation of the applicable currencies into U.S. Dollars is performed
for balance sheet accounts using current exchange rates in effect at the balance
sheet date and for revenue and expense accounts using a weighted average
exchange rate during the period. The effect of U.S. Dollar currency exchange
rates in Canada, Britain and Germany produced a net currency translation
adjustment loss of approximately $0.2 million, which was recorded as an
adjustment to stockholders' equity as an element of comprehensive income, for
the nine months ended September 25, 1999.
ALLIED
Operating revenues from operations outside of the United States for the nine
months ended June 30, 1999 amounted to L142.9 million, or 28.8% of Allied's
combined operating revenues. At June 30, 1999,
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Allied's net assets were L(63.0) million. Allied has operations in numerous
countries which have different functional currencies, principally the Pound
sterling and the Australian dollar.
The translation of the applicable currencies into Pounds sterling is
performed for balance sheet accounts using current exchange rates in effect at
the balance sheet date and for revenue and expense accounts using weighted
average exchange rates during the period. Due to currency fluctuations, the net
currency translation adjustment for the nine months ended June 30, 1999, was
approximately L.1.8 million which was recorded as an adjustment to stockholders'
equity.
INFLATION
We believe that inflation generally does not have a material effect on the
results of our operations.
SEASONALITY
Our operations are subject to seasonal trends common to the moving industry.
Results of our operations for the quarters ending in December and March are
typically lower than the quarters ending in June and September due to reduced
shipments and higher operating costs in the winter months. With respect to the
van line network, over half of the network revenue is typically generated from
May through September. For logistics services, shipping requirements of the
customer base result in higher shipment volumes at the end of each quarter.
Moving and storage services experiences seasonality with respect to residential
relocations; however, this is somewhat diminished by the geographic diversity of
our business moving activities.
NEW ACCOUNTING PRONOUNCEMENTS
In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities" (FAS 133). In June 1999, the FASB issued
Statement of Financial Accounting Standards No. 137, "Accounting for Derivative
Instruments and Hedging Activities-Deferral of the Effective Date of FASB
Statement No. 133" (FAS 137). FAS 137 deferred the effective date of FAS 133 to
all fiscal quarters of fiscal years beginning after June 15, 2000 (January 1,
2001 for our Company). FAS 133 requires that all derivative instruments be
recorded on the balance sheet at their fair value. Changes in the fair value of
derivatives are recorded each period in current earnings or comprehensive
income, depending on whether a derivative is designated as part of a hedge
transaction and the type of hedge transaction. Management anticipates that, due
to its limited use of derivative instruments, the adoption of FAS 133 will not
have a significant effect on our results of operations or financial position.
IMPACT OF YEAR 2000
The "Year 2000 issue" generally describes the various problems that may
result from the improper processing of dates and date-sensitive calculations by
computers and other equipment as a result of computer hardware and software
using two digits, rather than four digits, to define the applicable year. If a
computer program or other piece of equipment fails to properly process dates
including and after the Year 2000, date-sensitive calculations may be inaccurate
or a major system failure may occur. Any such miscalculations or system failures
may cause disruptions in operations including, among other things, a temporary
inability to process transactions, send invoices or engage in other routine
business activities. A failure of our computer systems could have a material
adverse effect on our operations, including its ability to make payments on the
notes.
STATE OF READINESS
We have not experienced significant disruptions or other problems since the
beginning of the year 2000. However, no assurance can be given that the Year
2000 issue will be resolved without any future
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disruption or that we will not incur significant expense in resolving the issue.
For example, we cannot assure you that such problems will not arise in
connection with billing, accounting or other periodic information gathering.
NAVL and Allied have contacted their vendors, suppliers, agents,
representatives, franchisees, service providers and major customers to help
evaluate these parties' efforts to prepare for the Year 2000 and the degree of
our corresponding exposure if such efforts are inadequate. NAVL and Allied
received satisfactory responses from most of these parties but have not
independently confirmed or verified the accuracy of such parties'
representations.
RISK OF YEAR 2000 ISSUES
Any failure of our computer systems or of the computer systems of our
vendors, suppliers, agents, representatives, franchisees, service providers or
major customers as a result of not being Year 2000 compliant could materially
and adversely affect our ability to provide our services and retain customers.
CONTINGENCY PLANS AND COSTS TO ADDRESS YEAR 2000 ISSUES
We have developed plans, including a contingency plan to assess the
likelihood of and address worst case scenarios, to deal with potential Year 2000
problems experienced by us or by our vendors, suppliers, agents,
representatives, franchisees, service providers or major customers. With respect
to Allied operations, assessment of key operating and commercial risks and
development of appropriate contingency plans has taken place. The plans are
developed for each location, involving staff and plans of the customers as
necessary.
As of December 31, 1999 we had incurred approximately $7.0 million of cost
to deal with the Year 2000 issue, which equals our total estimated cost of this
project. To the extent that systems need to be replaced or remediated,
additional material costs could be incurred. We do not currently expect that
other costs of our Year 2000 compliance program will be material to our
financial condition or results of operations. We may however, have to bear costs
and expenses in connection with the failure of our vendors, suppliers, agents,
representatives, franchisees, service providers and major customers to be Year
2000 compliant. Because no material Year 2000 issues have yet been identified in
connection with external sources, we cannot reasonably estimate costs which may
be required for remediation or for implementation of contingency plans.
MARKET RISK
We are exposed to various market risks, including changes in interest rates,
and foreign currency exchange rates.
From time to time we utilize interest rate agreements and foreign exchange
contracts to manage interest rate and foreign currency exposures. The principal
objective of such contracts is to minimize the risks and/or costs associated
with financial and international operating activities. We do not utilize
financial instruments for trading or other speculative purposes. The
counterparties to these contractual arrangements are financial institutions with
which we also have other financial relationships. We are exposed to credit loss
in the event of nonperformance by these counterparties. However, we do not
anticipate nonperformance by the other parties, and no material loss would be
expected from their nonperformance.
We enter into interest rate swap agreements to manage the impact of changes
in interest rates on our floating rate debt. The notional amount of the interest
rate agreement is used to measure interest to be paid or received and does not
represent the amount of exposure to credit loss. The net cash amounts paid or
received on the interest rate swap agreement are accrued and recognized as an
adjustment to interest expense.
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As of September 25, 1999, we had outstanding an interest rate protection
agreement denominated in Dollars, terminating on June 29, 2001, with a notional
amount of $75.0 million. This agreement established an interest rate cap of
7.0%, protecting against upward movement in interest rates on our existing term
loans. Interest on these loans is variable and based on LIBOR. Based on the
amount that we would pay to exit this contract, the fair value of the interest
rate protection agreement at September 25, 1999, was $0.2 million.
We may enter into forward currency exchange contracts from time to time in
the regular course of business to manage our exposure against foreign currency
fluctuations on transactions denominated in foreign currencies. We had no open
positions on forward exchange contracts as of September 25, 1999.
Other assets at September 25, 1999, included marketable equity securities
which are classified as available-for-sale and are recorded at fair value.
Unrealized holding gains and losses, net of the related tax effect, on
available-for-sale securities are excluded from earnings and are reported as a
separate compnonent of other comprehensive income until realized.
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BUSINESS
OUR COMPANY
We are the world's largest global relocation and moving services company and
also the largest logistics services provider among all U.S. van lines. We are a
global network manager of agents, owner/operators and company-owned branches
with locations in 21 countries. Our diversified customer base includes many
leading Fortune 500 and FTSE-100 companies, private transferees and the
government and military of the United States and other countries. We believe
that the combination of NAVL and Allied will result in substantial operating
synergies due to complementary product offerings, distribution networks and
significant economies of scale, which will generate incremental cash flow and
fund future growth.
Our relocation businesses provide high-quality packing, warehousing, hauling
and delivery for both domestic and international residential moves. In the
United States and Canada, we operate our van line network segment through a
network of 896 agents in approximately 1,300 locations and through 581
representatives worldwide. We moved 246,900 households within the United States
in 1998, representing a 27% market share of the moves handled by the top 18
national van lines. Outside of the United States and Canada, our moving and
storage services segment operates through 183 company-owned branches throughout
the United Kingdom, continental Europe, Australia, New Zealand and Asia. We also
provide a broad portfolio of services to commercial customers, including office
and industrial relocations and records management. Our global relocations
business has a well established and diverse customer base, including the U.S.
military and government, Cendant Mobility, Ford, Boeing, Texas Instruments,
Motorola, British Aerospace and Barclays.
Our logistics services segment provides customized solutions to facilitate
the movement of high-value products that require specialized transport and
handling such as electronics, telecommunications and medical equipment and fine
art. We are the largest provider of these services among U.S. van lines. Our
technology-based logistics services link order processing, inventory management
and product tracking with transport services on a global basis. We have
established numerous long-term relationships with large corporate customers,
including IBM, Hewlett Packard, Lucent Technologies, Sears, GE, EMC Corporation,
Siemens and Hitachi, with no single customer representing more than 5.0% of our
logistics revenues in 1998. According to industry sources, about half of all
logistics costs for transportation and inventory management incurred in the
United States are for services purchased from independent suppliers. Within this
$440.0 billion market serviced by independent suppliers, approximately
$22.0 billion, or 5.0%, is provided by "third-party provider" logistics firms
such as ourselves. We estimate that this third-party provider market will
experience double-digit growth for the foreseeable future as more companies
outsource these services. We believe that the outsourced transportation and
logistics market serviced by national van lines was approximately
$824.0 million in the United States in 1998, representing 1.2 million shipments.
In the same year, we generated $351.0 million in revenue from high-value product
logistics services, representing a 42% market share among the top 18 national
van lines.
The table below contains certain statistics about our operations as of
December 31, 1999.
<TABLE>
<CAPTION>
<S> <C>
EXCLUSIVE AGENTS
Number of Agents.......................................... 896
Number of Agent Locations................................. 1,265
NON-EXCLUSIVE REPRESENTATIVES (located in 125 countries
outside of the United States and Canada).................. 581
COMPANY-OWNED MOVING AND STORAGE BRANCHES
Europe.................................................... 106
Asia/Pacific.............................................. 75
LOGISTICS FACILITIES
United States............................................. 85
Europe.................................................... 14
</TABLE>
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COMPETITIVE STRENGTHS
The combination of NAVL and Allied provides us with a strong competitive
position driven by the following:
- INDUSTRY LEADER: The expanded scope of our operations will provide us with
leading positions in the markets in which we compete. We are the global
leader among van lines in providing residential relocation services, with
the number two market position in the United States and, management
believes, number one in international moves originating in or destined to
the United States. We are the leading U.S. van line serving the high-value
product logistics market. We have the most extensive relocation and
logistics network among U.S. van lines, with operations in 21 countries
throughout the world. Our global capabilities and leading market positions
will be a competitive advantage in attracting and retaining customers who
seek suppliers that are capable of serving them around the world.
- LEADING BRANDS: As a result of the Allied acquisition, we will own some of
the most internationally recognizable brand names in the industry,
including northAmerican, Allied and Pickfords. Independent research has
shown that Allied and northAmerican are two of the three most recognized
brand names, respectively, in the van line industry in the United States
and that Pickfords is the most recognized moving services company in the
United Kingdom.
- DIVERSIFICATION: The combination of NAVL and Allied diversifies and
expands our revenue base, geographic presence and customer base. The
markets that the van line network, moving and storage services and
logistics services segments serve, while complementary, are diversified in
their response to changes in market and economic conditions, competition
and capital intensity. Management believes these segments' combination of
asset and non-asset based operations, geographic distinctiveness, broad
service offerings and diversified customers provides an attractive level
of risk diversification.
- LONG-STANDING CUSTOMER RELATIONSHIPS: Throughout the world, we have
long-standing customer relationships with numerous Fortune 500 and
FTSE-100 companies and governments and military in the United States and
other countries. We believe that these relationships are due in part to
our emphasis on high-quality customized solutions and services. Our
customer relationships include long-standing relationships with the U.S.
Department of Defense, IBM, GE, Hewlett Packard, Sears, Siemens and
Cendant Mobility. We believe that these relationships provide us with
significant credibility when marketing our services to new customers and
in cross-selling additional services to our existing customers.
- EXPERIENCED MANAGEMENT TEAM: Our management team brings together a
combination of industry expertise and Fortune 100 companies' best
practices.
BUSINESS AND GROWTH STRATEGY
The key elements of our business and growth strategies are as follows:
- CAPITALIZE ON OPERATIONAL EFFICIENCIES: Prior to the Allied acquisition,
NAVL's management team initiated a major process improvement program
entitled Fast Forward to identify and implement operational efficiencies.
In addition, as a result of the Allied acquisition, we expect to realize
significant synergies. We believe that the ongoing realization of Fast
Forward efficiencies and the achievement of operating synergies and cost
savings from the acquisition (as further described below) will generate
significant cash flow.
- FAST FORWARD. In early 1999, a team of consultants and employees spent
approximately six months evaluating the NAVL business and generated
numerous ideas to be implemented across NAVL operations. The emphasis
of the Fast Forward initiatives includes
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(1) employment reductions due to work elimination, process innovation
and automation, (2) terminal and network efficiencies and other
reductions in operating costs, (3) revenue, price and fee enhancements
and (4) other general and administrative savings primarily as a result
of process redesign and productivity. Management expects the
implementation of Fast Forward to be substantially completed by the end
of the year 2000 and to result in significant savings.
- OPERATING SYNERGIES. In addition to the savings resulting from our
Fast Forward project, management of NAVL and Allied together have
identified potential synergies resulting from the Allied acquisition,
including: (1) employment reductions due to consolidation,
(2) capacity planning and facility efficiencies, (3) "best practice"
adoption, (4) employee benefit group insurance savings and
(5) purchasing synergies. The total potential savings as a result of
these synergies are expected to result in annualized savings of
approximately $20.0 million per year by 2002.
- REINVESTMENT IN BUSINESS OPERATIONS: We intend to use a portion of the
funds generated by the operational efficiencies and synergies detailed
above to develop capabilities that differentiate ourselves from our
competition. We will reinvest in three main components: information
technology, process capability and human capital. We intend to:
- Enhance our technology strategy in logistics services to include
additional capabilities and tracking and communication techniques in
order to maintain and grow our logistics business. In the van line
network, Allied has developed advanced systems designs, which we plan
to implement across the entire agent network to improve operating
efficiencies. We are currently in the process of developing an
e-commerce strategy which may allow us to utilize our current operating
systems to take advantage of the changing consumer dynamics in the
markets we serve. However, we have not yet determined the structure and
scope of this business and cannot assure you that the development of
this business will not occur through a spin-off, other divestiture or
other manner (such as a joint venture) that may make the profits
generated by this business, if any, unavailable to North American Van
Lines.
- Improve our process capability to enhance our quality, service and
back-room process to achieve higher customer satisfaction, lower costs
and increased cash flow.
- Develop training and education programs for agents, drivers and
associates to ensure sharing of best practices, operational
effectiveness throughout the network and sustained productivity gains.
- PRIORITIZE GROWTH OPPORTUNITIES: We intend to pursue growth opportunities
in logistics and international and domestic relocations.
- The logistics services segment has been our fastest growing segment and
offers a high return on assets. We intend to expand the capacity,
product line offering and geographic presence through organic growth
and/or selective strategic acquisitions.
- We are the world's largest provider of international residential
relocation services. We intend to leverage our position in this segment
to benefit from the continued growth in international residential
relocation.
- Our van line network is our largest segment and exhibits stable cash
flow. We intend to implement best practices to further improve our
quality, service and costs and to then leverage them to increase market
share in the residential relocation business.
- Our moving and storage services segment has a significant global
presence and broad product diversification. We intend to grow certain
profitable services in other geographic areas in Europe and
Asia/Pacific.
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INDUSTRY OVERVIEW
RELOCATION SERVICES INDUSTRY
Generally speaking, the residential relocation services industry consists of
relocations handled by professional movers and "do-it-yourself" relocations. As
to professional movers, a distinction typically is made between regional and
national moving companies, as well as between international and domestic movers.
The greater the territory covered, the greater network is required.
Management estimates that, in the United States, the 18 national van lines
generated gross interstate revenues of approximately $3.4 billion in 1998. The
main participants in the U.S. professional residential relocation services
industry are (1) van lines, which operate through agency networks, of which
there are an estimated 18 providing national services; (2) approximately 980
independent carriers, which are companies that provide full moving services
without van line affiliation; (3) approximately 4,500 agents, which are
independently owned companies affiliated with van lines; and (4) approximately
30,000 owner/ operators, which are independent contractors that are retained by
van lines, independent carriers or agents and who own and drive tractors and are
responsible for transporting, loading and unloading shipments. Traffic in the
residential relocation industry is fueled by the mobility of populations, due,
for example, to relocations in response to changes in employment location,
retirement or lifetime change. This industry generally markets to three distinct
customer groups: (1) corporate accounts that pay for the relocation of their
employees, (2) private transferees that pay for their own moves and
(3) governments, which pay for the relocation of their civil and military
personnel.
According to the latest study of the U.S. Bureau of Census, 42.1 million
Americans changed residence in the year ending March 1997. Based on an average
family size of 2.34 persons, this translates into approximately 18.2 million
household moves each year. Of the 18.2 million total household moves,
2.8 million are estimated to be interstate. Local and intrastate professional
moves are predominantly handled by local agents. Professional movers service an
estimated 7.6% of the total estimated 18.2 million U.S. household moves each
year.
Management views the market in the United Kingdom, Australia and New
Zealand, as fragmented, with a few large suppliers providing the full range of
packing, loading, hauling and unpacking, and a considerable number of smaller,
low-cost operators. In the United Kingdom, there were approximately 1.8 million
household moves in 1997. The entire Western European residential relocation
market is estimated to be L4.2 billion.
The U.S. international residential relocation services market, which targets
multi-national companies primarily based in the United States and provides or
coordinates relocation services for residential shipments destined to or
originating in foreign countries, has grown due to increasing globalization of
economies and the advent of free trade. International relocation services are
principally offered by companies that provide services through non-exclusive
representatives at the destination locations around the world. There are a few
companies that own and operate their own businesses in markets abroad, as we do
in the United Kingdom, Australia and New Zealand.
Similarly, the international relocation market in the United Kingdom,
Australia and New Zealand has grown due to the growth in intra-European business
moving and renewed investment activity in Asia/ Pacific. Another driver of the
international relocation market abroad is the issuing of visas for private
transferees. Typically this traffic is from the United Kingdom to Australia and
New Zealand. In recent years, this market has remained stable as the receiving
countries have held steady the number of migrant visas issued.
The office relocation industry, in which we operate primarily in the United
Kingdom, is driven primarily by economic change and the life cycles of
businesses. Both economic growth and decline affect this market. Both bring on
circumstances that may require businesses to move. The records management
market, in which we operate primarily in the United Kingdom and Australia, is
driven by an increasing
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demand for companies to retain a broader range of documentation for legal
purposes. In addition, pressure on office space is also forcing companies to
seek external storage facilities rather than relocate and, even when they do
relocate, many companies take that opportunity to store surplus documents. The
industrial relocation industry is fueled by the movement to global
manufacturing, the recycling of plants to developing countries and the
reinvestment in new technologies. As with business relocations, economic cycles
and changes can affect this industry, and both economic growth and decline can
trigger shifts in manufacturing capacity and location.
LOGISTICS SERVICES INDUSTRY
Many businesses have decided to outsource management of all or a part of
their distribution chain, and as a result, third-party logistics providers, such
as us, have become extensively involved in the full range of customer supply
chain functions. Logistics services include order fulfillment, freight bill
auditing and payment, cross-docking, product marking, labeling and packaging,
inventory and warehouse management, parts return and repair and the actual
physical movement of goods. According to industry sources, about half of all
logistics costs incurred in the U.S. relate to services provided by independent
suppliers. The trend towards outsourcing transportation and inventory management
is expected to cause this $440.0 billion market to continue to grow
significantly. Within this current $440.0 billion market, approximately
$22.0 billion, or 5.0%, is outsourced to "third-party provider" logistics firms
such as ourselves, who have the technology-based solutions to manage the entire
supply chain network. This $22.0 billion market is itself expected to experience
double digit growth for the foreseeable future as more companies look to
third-party providers for complete packages of supply chain solutions for
certain aspects of their logistics needs.
We believe that this fragmented logistics market will continue to grow
significantly over the next several years and will experience consolidation. The
demand for integrated logistics services is growing with an increase in the
outsourcing of transportation services as well as an increase in the number of
large-scale manufacturers who adopt just-in-time processes. The need for
just-in-time and other time-definite delivery has increased as a result of the
globalization of manufacturing, greater implementation of demand-driven supply
chains and the shortening of product cycles. In addition, the growing demand for
global consumer brands, the increasing number of multinational corporations,
global sourcing and the removal of trade barriers have all spurred substantial
growth in complex, cross-border delivery. Moreover, there has been dramatic
growth in the utilization of e-commerce by both consumers and businesses for the
transfer of goods. Companies that sell to customers through the Internet require
and expect rapid, multi-destination delivery capabilities. As a result of these
factors, companies are increasingly demanding complex distribution management
solutions from third-party providers.
Companies are requiring increased precision in tracking and timely
information about service disruptions. As a result, logistics service providers
need increasing amounts of technology, and advanced information systems have
become central to the logistics infrastructure. The ability to provide accurate,
up-to-date information on the status of shipments to ensure on-time delivery,
real-time visibility of inventory on a global basis and efficient operations
provides competitive advantages in the transportation and distribution services
industry.
Additionally, the logistics segment of the moving industry is driven by
corporations' increasing need for specialized handling of sophisticated
equipment. This segment traditionally has been focused largely on the computer
and electronics sector, but has recently experienced increasing growth in the
telecommunications and medical equipment sectors.
The logistics industry is consolidating because of the advantages of global
distribution networks, large vehicle fleets and global information technology
systems. In addition, consolidation is driven by the customers' desire for
integrated services, the high growth in international and cross-border delivery
segments and, in Europe, the deregulation of European delivery markets. Industry
participants are
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acquiring, merging with or forming alliances with partners that can expand
global reach, breadth of services or technological capabilities in order to
better enable those participants to compete in a rapidly changing global
environment.
SERVICES AND OPERATIONS
RELOCATION SERVICES
VAN LINE NETWORK. Operating under the brand names northAmerican and Allied
throughout the United States and Canada, we are a leading provider of both
domestic and international residential relocation services. The nature of our
van line network is that of a coordinator, administrator and processor of both
domestic and international residential moves with access to a vast collection of
physical assets primarily owned by agents and owner/operators. Our van line
network business is primarily conducted through a network of over 880 exclusive
NAVL or Allied agents in the United States and Canada. Agents are independently
owned local moving companies that provide customers with the local packing,
warehousing and a portion of the hauling required to support household moves
anywhere in the world. We, in turn, provide our agents with a broad range of
services including identification and coordination of hauling capacity,
coordination of shipments, optimization of capacity and sophisticated
transportation and logistics technology. We also provide insurance, national
advertising and marketing services under recognized brand names and other
services to agents and owner/operators.
We participate in all lines of the residential relocation interstate
transportation business and have a highly diversified customer base. Van line
network customers are (1) corporate accounts, (2) private transferees and
(3) government and military.
The NAVL and Allied agents are the primary sales channels for most of our
business activities and market our services locally or as intermediaries with
customers. Owner/operators are independent contractors who own and drive their
tractors for us. The majority of the equipment used in van line network is owned
by our network of agents and owner/operators. This allows us to leverage our
agent and owner/operator infrastructure by minimizing capital expenditures and
generating a superior return on assets and investments. See "--Agent Network"
and "--Owner/Operators."
For domestic moves, we coordinate both ends of the move through our agents.
For international moves originating in the United States and Canada, our NAVL
line acts primarily as a freight forwarder, arranging for cross-border
transportation services with third-party providers and subcontracting with non-
exclusive representatives for the hauling, delivery and unpacking required at
the destination. With respect to Allied, international moves are coordinated by
Allied's international moving services network. This network consists of
Allied's wholly owned moving services companies in the major non-U.S. markets
and independent affiliated agents in major U.S. markets. Each network member is
responsible for providing origin and freight-forwarding services for moves
originating in its country of operation, as well as coordinating destination
services using network members in the country of delivery. Customers moving
either domestically or internationally contact local agents who obtain shipment
details and provide moving cost estimates. Once a quote turns into a booking,
the agents register the move with us, and we coordinate all parties involved in
the move and arrange and process the transaction.
MOVING AND STORAGE SERVICES. Our moving and storage services segment
provides residential relocation services primarily in the United Kingdom,
Australia and New Zealand by operating local moving branches which provide
similar services as agents do in the van line network segment. Unlike the van
line network, moving and storage services owns or leases property and vehicle
assets used in its network. Management believes that Pickfords, in operation
since 1646, is the number one provider of relocation services in the United
Kingdom. Pickfords' company-owned branches deal directly with corporate clients,
private transferees and government departments.
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In Australia and New Zealand, we also provide domestic and international
relocation services through company-owned branches operating under the Allied
Pickfords brand name. In Asia, the network is a combination of company-owned
branches, franchises and preferred agents, with a focus on international, rather
than domestic, relocations.
In addition to its residential relocation services, Pickfords also provides
crating services, storage services and records management which includes, among
other things, the cataloging, storage, retrieval, look-up, destruction and
transportation of customers' records. Pickfords also provides a full range of
office and industrial relocation services involving the transport of office
furnishings and equipment in connection with the relocation of any aspect of a
business' operations throughout Europe. Another component of moving and storage
services is contract engineering services such as moving heavy plant equipment
and installing electrical facilities. In late 1998, Pickfords acquired Vanguard
Engineering, an industrial mover, and management believes the combination
resulted in the United Kingdom's largest industrial moving business. Allied
Pickfords provides office relocation and records management services in
Australia and New Zealand.
Allied Arthur Pierre, based in Belgium, is a market leader in international
residential relocations in Belgium and Luxembourg and also operates in France.
Our other moving operations in continental Europe include Allied Varekamp, a
market leader in international household relocations in the Netherlands. Allied
also has operations in major cities in Eastern Europe, including Budapest,
Moscow, Prague and Warsaw.
LOGISTICS SERVICES
Our logistics services segment manages the coordination of complex supply
chain networks, with a focus on high-value products that require specialized
transport and handling such as electronics, telecommunication equipment and
medical equipment. Our logistics services segment is organized into three
business units: (1) logistics solutions, which uses customized information
technology to coordinate a variety of services to customers such as finished
goods and emergency parts distribution, order fulfillment, project-specific
delivery management and the tracking of products through the supply chain;
(2) specialized transportation; and (3) European operations, which handles
logistics solutions and specialized transportation of high-value products to and
from any major city in the United Kingdom and Europe through wholly owned
subsidiaries operating under the trade name midiData. Logistics services manages
the cost efficiency of clients' shipments primarily through its OnTrac Network,
a system that combines logistics tools with 32 distribution centers and agent
service points. We have established numerous ongoing relationships with key
corporate logistics clients, including many Fortune 500 companies.
We have developed sophisticated technology-based solutions to manage all
stages of the distribution chain, with a specific focus on high-tech industries.
We offer a range of logistics solutions supported by an integrated information
system (AMPTS) that links order processing, inventory management and product
tracking with physical distribution functions. This business combines our
delivery services with advanced logistics design expertise to control costs,
reduce inventory and increase productivity. Specifically, we provide our clients
with integrated supply chain management, the management of spare parts,
distribution facilities, turnkey new store equipment transportation and set up,
freight forwarding and product assembly.
These services are provided to clients primarily in the United States,
Canada and Europe with distribution systems that range from regional to global.
Logistics services include:
- finished goods and emergency parts distribution on a national and
international basis;
- domestic and international freight forwarding;
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- third-party carrier management services (brokerage);
- order fulfillment including after-market parts distribution, kitting,
assembly, delivery and return;
- project-specific delivery management through the OnTrac Network, logistics
centers and agents;
- field merges, including single delivery of products from multiple-origin
locations to specific customer requirements;
- finished goods configuration, assembly/disassembly postponement programs;
and
- reverse logistics capability to take back products and/or materials for
purpose of reuse, recycling or environmentally responsible disposition.
In addition, we provide the physical, specialized transportation of
high-value products unsuited for typical freight hauling. With our fleet of
trucks specifically equipped to handle the loading, unloading and hauling of
sensitive, technology-based products including computer equipment, robotics,
fine art, industrial equipment and store fixtures, we can combine our physical
distribution capabilities with our logistics solutions to provide our clients
with a complete package of efficient distribution management.
As in relocation services, the nature of our operations in logistics is that
of a coordinator, administrator and processor of our customers' distribution
chains. The specialized product delivery process is similar to that in
relocation services, where corporate accounts contact local representatives to
establish individual shipment requirements and we then contract with the
owner/operators. The majority of the logistics hauling is done by
owner/operators.
In 1999, we explored the feasibility of expanding our logistics services
segment into the home delivery market. While we had been providing home delivery
services for a small number of current logistics customers for a number of
years, a new customer, Williams & Sonoma was secured in mid-1999 as a high
volume, home delivery customer for the purpose of entering and establishing a
base within this market. In late 1999, we decided to exit the home delivery
market, because it was not profitable nor did it fit strategically or
operationally in our current business model. We are working with Williams &
Sonoma to transition out of the home delivery service market and we expect costs
to be associated with this transition.
We own the majority of the specialized trailers used in logistics services.
Management believes that we maintain the industry's largest and most advanced
delivery fleet among van lines focused on the transport of sensitive commodities
and freight. Throughout our history, we have developed equipment designed to
facilitate safer and more efficient delivery. We hold a number of patents for
specialized moving and packaging tools. In addition, we lease and operate
several of the distribution centers in the logistics network. Each of these
distribution centers is equipped with state-of-the-art inventory management and
product tracking systems.
OTHER SERVICES
In support of our business segments, we also operate insurance and fleet
services operations. We have a captive insurance subsidiary licensed in Indiana,
North American Transport Insurance Company, which historically was part of NAVL.
This subsidiary principally markets physical damage insurance, and provides such
coverage to the majority of NAVL's owner/operator fleet and a portion of NAVL's
agent fleet. We also own an insurance group, which historically was part of
Allied, consisting of an insurance agency, a general agency and an insurance
company, TransGuard Insurance Company of America, Inc. (an Illinois corporation
which is licensed in forty-three states). This insurance group provides
(1) commercial property and casualty insurance; (2) life, health and disability
insurance; and (3) workers' compensation and occupational accident insurance.
The profits from these operations have historically been included in the results
of operations of the van line network or, in the case of our North American
Transport Insurance Company subsidiary, split between the van line network and
logistics services segments in the proportion of
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drivers covered by such segments. We also operate The Baxendale Insurance
Company Ltd. (licensed in Ireland) as part of our moving and storage services
segment.
We also operate a fleet service operation, which provides full service
vehicle maintenance and repair work from two locations, generating approximately
$22.0 million of revenue annually. We provide repair service for our own tractor
and trailer fleet as well as the equipment of our owner/operators, agents and
outside commercial customers. We are also a tractor and trailer equipment
dealer, and provide conditional sales contract financing for equipment sold to
our owner/operators and agents. The operating profit from this operation is
allocated to the segments which use its services.
AGENT NETWORK
In our van line network and logistics services segments, our agents provide
(1) local sales, packing and warehousing; (2) hauling services and distribution
of goods; and (3) direct sales solicitation and customer development. The agents
own the assets associated with operating in their markets (warehouses, tractors,
trailers and other equipment) and in many instances have contracts with
owner/operators or have hired employee drivers to bring hauling capacity to the
network.
We have established (in both our NAVL and Allied lines) exclusive long-term
relationships with an extensive network of agents in approximately 1,300
locations in the United States and Canada. Our relationships with our agents
often extends across generations. Agents typically enter into renewable,
multiyear contractual relationships with us. In April of 1999, the initial term
of the agency contracts between Allied and U.S. agents representing
approximately 52.1% of Allied's 1998 revenue booked by U.S. domestic agents
expired. Although a majority of these agents have signed eighteen-month
extensions, the contracts for the remainder of these agents (representing 8.0%
of Allied's 1998 revenue booked by U.S. domestic agents), although still in
effect, may be terminated by these agents on three months' notice. We intend to
negotiate renewals of these contracts with these agents, but we cannot assure
you that these contracts will be renewed on favorable terms or at all. However,
we have historically experienced relatively low agent turnover due to
management's focus on service and quality and its ability to maintain a
reasonable yet profitable relationship with the agent network. NAVL's top 20
agents have an average remaining contract life of 6.3 years and Allied's top 20
agents have an average remaining contract life of 3.0 years. There is no
significant number of NAVL contracts up for renewal; however, NAVL's fourteenth
largest agent terminated its relationship with us on of January 30, 2000. No one
agent constituted more than approximately 3.0% of the combined 1998 revenues of
the van line network and logistics services segments.
We compete with other van lines for the resources of the best individual
agents. We retain a percentage of the revenue and commission from the
participating agents for our services. Fundamental to maintaining long-term
exclusive relationships with our agents, we provide them with the following:
- internationally recognized and marketed brand names;
- global network of agents through which a local agent can rely on other
quality agents to pack, ship, store and/or unpack, as needed, the agent's
customers' goods and can reduce the need for making a costly empty return
trip after delivering goods to a distant location;
- load planning, consolidation and optimization, dispatch, shipment tracking
and customer service;
- the disbursement of cash for hauling and packing revenues before cash is
collected from the customers, taking credit risk, eliminating the cost of
carrying uncollected funds and providing liquidity to agents (we also
collect and distribute revenues among agents and owner/operators);
- administrative services, such as claims resolution, data processing and
calculation of fuel and other taxes and fees required to be submitted to
the states through which the agents haul goods;
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- national advertising and marketing and sales support; and
- the logistics services operations network and associated logistics
services.
In addition, we use various software to optimize traffic flows and, from our
corporate headquarters, track shipments and coordinate logistics for
longer-distance moves, which may require the use of multiple trucks and agents.
We also provide in some instances additional services to our agents, including
local agency computer systems, packing materials, uniforms and other supplies,
fleet maintenance services, tractor and trailer sales and financing and
brokerage of insurance packages.
OWNER/OPERATORS
Owner/operators are independent contractors with either us or with our
agents. They (1) provide the hauling skills required to transport shipments
interstate; (2) provide or contract with temporary workers to provide labor
required for servicing the customer; (3) provide an element of customer service
at the pick-up or delivery point; and (4) supply equipment they own to provide
hauling services. The owner/operators enter into contractual agreements with
either us or an agent which sets compensation rates and other terms and usually
provides for their exclusive service to us or that agent. NAVL maintains
approximately 700 company or agent owner/operators for relocation services and
approximately 1,000 company owner/ operators for logistics services. These
owner/operators own or lease their own tractors, but in most cases, pull
company-owned trailers. Owner/operators provide most of the logistics hauling
capacity and supplement the relocation fleet of agent drivers. In addition to
the primary owner/operator contract for transportation, we have also developed
additional programs or services offered to owner/operators that provide us with
additional sources of revenue, including tractor sales and financing, fleet
service maintenance and fuel sales and physical damage insurance coverage.
INFORMATION TECHNOLOGY
We have available to us a broad set of computing services for our network
management, network of service providers, and end customers. Over the next year,
we intend to combine Allied's and NAVL's information technology systems,
selecting the best aspects of the information technology resources of each of
Allied and NAVL, and migrating to that platform. We expect to incur
approximately $5.8 million of expenses in connection with this integration.
We have developed a number of innovative software solutions to support the
network management function. Our core systems provide product information,
pricing, shipment load planning, routing, dispatch of its fleets, and billing.
In addition, these systems provide the revenue distribution (settlement) systems
to the network of service providers. Enhancements to the core systems have been
made over many years to: (1) simplify complex processes and ease user adoption;
(2) further automate complex problems; and (3) improve the quality of data. In
addition, we have implemented systems to support expansion of products and
services to other countries on an "as needed" basis. Management believes we are
more automated than many of our competitors, and that this automation aids in
attracting and retaining agents.
NAVL's agents use many of these same systems in support of both network and
local business. Asset management automation is used as a sophisticated logistics
tool for broader inventory management applications, such as field merge and
just-in-time ("JIT") programs. The software tracks product level and status
regardless of location and manages component shipping through the product
tracking feature on a timely basis.
NAVL was one of the first van lines to implement a satellite communication
system (developed by Qualcomm, Inc.) and to fully equip its fleet with such
advanced communication capabilities. The system can determine locations within
1,000 feet and facilitates real-time data communication between our network
management group, the network of driver service providers, and service provider
personnel. This
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communication system provides much of the information which supports the
shipment tracking component of our internet sites for the benefit of the
end-customer.
Allied recently made a number of advanced technological improvements
including integration of a new general ledger and accounting package
(PeopleSoft). Several service-provider-focused, web-based initiatives have been
implemented including: (1) a critical shipment event alerting system; (2) an
integrated task management tool to reduce paperwork, streamline repetitive tasks
and improve communication and service; and (3) the implementation of a high
speed wide-area network for many of Allied's service providers. In addition, the
following customer-focused, web-based initiatives have been implemented:
(1) shipment tracking that allows customers to track the status of a shipment
from origin to destination; (2) on-line claims reporting that allows customers
to file claims over the internet; and (3) enhanced corporate reporting that
improves access to and the reporting parameters of corporate accounts.
Our relocation and logistics operations are implementing programs that
management expects to improve operating efficiency in the near future. A
relocation services estimating system is expected to electronically capture
shipment information, reduce paperwork, increase accuracy and expedite billing.
Additionally, a logistics services integration project is planned to support
improved order registration and permit more complete data entry to improve
customer service and expedite billing. Improved transportation management
systems are expected to help us manage third-party service providers. With the
ability to maintain separate tracking information by shipment, these systems are
expected to be accessible to customers as well as to interface directly with the
billing/service provider settlement system while providing real-time updates.
In 1998, NAVL transferred ownership of its internally developed computer
software, including an integrated information system (AMPTS), and other elements
comprising or supporting the Customized Options in Logistics Technology ("COLT")
to Norfolk Southern (COLT is comprised of a warehouse management module, a
serialized inventory module, AMPTS and TMS). In connection with this transfer,
Norfolk Southern and an affiliate of Norfolk Southern granted NAVL a perpetual,
royalty-free license to use, modify and sublicense certain subsidiaries and
affiliated companies to use the COLT software. The license provides that NAVL
has the exclusive right to use the COLT software in connection with its
relocation and logistics businesses (as those businesses are defined in the
licensing agreement) in North America and Europe. The terms of the license
prohibit NAVL from using the software in connection with the automotive and
chemical businesses in North America and Europe and from providing logistics
services to a railroad or acting as a service bureau for certain kinds of motor
carriers.
A significant portion of Allied's proprietary software was developed over an
extended period of time by numerous employees and independent contractors, some
of whom did not execute written agreements with respect to their work product.
Therefore, with respect to certain portions of such software, we are unable to
confirm that Allied's ownership cannot be contested. However, we do not believe
any such discrete portion to be of material independent value, which reduces the
risk that any such employee or independent contractor would assert its rights in
these portions.
CUSTOMERS AND MARKETING
We have long-standing customer relationships with numerous Fortune 500 and
FTSE-100 companies and governments and military in the United States and other
countries. We believe that these long-standing relationships are due in part to
our emphasis on high-quality customized solutions and services and provide us
with significant credibility when marketing our services to new customers and in
cross-selling additional services to our existing customers. Our customer
relationships include long-standing relationships with the U.S. Department of
Defense, IBM, GE, Hewlett Packard, Sears, Siemens and Cendant Mobility. However,
IBM, one of our largest logistics customers, recently indicated that it is
considering alternative suppliers, which will result in its doing less business
with us.
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Allied has an innovative customer measurement system administered by The
Gallup Organization. In addition to identifying the key drivers of customer
satisfaction, this system provides a significant tool for targeting continuous
improvement initiatives. Electronically based, the system provides on-line
results immediately available to all service providers so that corrective action
and/or reward and recognition can be provided for on a timely basis. As part of
this system, Allied ranks and rates all agents and their impact on "internal
commerce" by making scores available to network members. These scores can be
used as a basis for selecting service providers on out-of-area moves.
The key driver of customer satisfaction identified by Gallup is consistent
communication throughout the move. To this end, we intend to adopt an
Allied-created, proprietary, web-based move management system. This system
automates agent communication standards. It prompts the move coordinator and
notifies the system of any changes or problems.
Our marketing department provides a full range of agency sales support
programs and has been recognized by the American Trucking Association many times
for its award-winning material. The marketing organization includes a product
manager structure that allows for a specific, customized marketing approach for
both the relocation and logistics services operations, which ensures a
consistent image and message throughout the world. Our centralized sales,
support and marketing department, which coordinates our efforts
- evaluates target markets and sets a customer-driven sales agenda,
- ensures the consistency of customer communication,
- encourages product managers to "think global-act local,"
- directs local input via the Corporate Marketing Agent Advisory Council and
- provides the ability for agents to customize advertising and sales-support
programs and collateral.
Our sales force is comprised of experienced agents and product sales
specialists. We provide a broad range of professional sales training programs
and customized sales management training to our agents and employees. For
example, our Professional Sales Association is an Allied-backed sales training
and educational organization for sales representatives employed by Allied
agents. The Professional Sales Association's interactive web site is a way to
introduce new products and services and provide access to resources of product
knowledge. The training branch of the Professional Sales Association provides
both classroom training and interactive web-based training. Extensive modules
are self-administered and available on demand 24 hours per day, seven days per
week. Management believes interactive sales training via the web provides a
cost-effective way to train a diverse sales force. We also support industry
association-based training and certification programs such as the American
Moving and Storage Association's Certified Moving Consultant and Registered
International Mover.
Advertising campaigns work in tandem with directory advertising to create
leading brand awareness in the industry. We advertise primarily on cable
television and through national billboard buys. Advertising targets key customer
segments, as well as owner/operators.
We believe that the agent organization will be re-energized through a series
of changes that will include more aggressive sales channel enhancements and
greater emphasis on agent capacity development. A variety of employee, driver
and customer initiatives and on-going programs at both Allied and NAVL are
expected to provide additional appeal and effectiveness, including the NAVL
customer publication "Worldwide" and the NAVL web site and Allied's recently
developed web-enabled technologies, such as Allied's corporate web site (which
provides not only company information, but information to facilitate a
successful move), sales training web site, move management system, on-line
claims reporting and enhanced corporate reporting.
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COMPETITION
The relocation services business is highly competitive and fragmented. With
respect to our van line network, aside from the handful of large van lines the
industry remains extremely fragmented with many small private players that may
have strong positions in local markets. We compete primarily with other van
lines, truckload carriers and independent contractors and, with respect to
certain aspects of its business, intermodal transportation, railroads and
less-than-truckload carriers. Intermodal transportation (the hauling of truck
trailers or containers on rail cars or ships) has increased in recent years as
reductions in train crew size and the development of new rail technology have
reduced costs of intermodal shipping. Some of our chief competitors in the van
line network are Unigroup (United and Mayflower), Atlas, Bekins and Global.
The moving and storage services segment is also extremely fragmented between
regional, national and local companies. Many of these companies may specialize
in segments of the moving market such as international, domestic or office
moving. Price is a key driver in selection of a mover, so there is a need to
operate cost effectively while maintaining high customer service standards. Our
chief competitors in the moving and storage services include Crown Pacific,
Britannia, TransEuro, White & Company and Interdean in residential relocations,
Harrow Green and Edes in office relocation and Beck & Pollitzer and Ainscough in
industrial relocation.
The logistics industry is also highly competitive and fragmented but is
consolidating because of the advantages of global distribution networks, large
vehicle fleets and global information technology systems. In addition,
consolidation is driven by the customers' desire for integrated services, the
high growth in international and cross-border delivery segments and, in Europe,
the deregulation of European delivery markets. Industry participants are
acquiring, merging with or forming alliances with partners that can expand
global reach, breadth of services or technological capabilities in order to
better enable those participants to compete in a rapidly changing global
environment. In specialized transportation services, we compete with a broad
spectrum of transportation providers including forwarders, brokers and various
logistics providers. In Europe, the industry is fragmented with no single
provider offering a pan-European specialized distribution capacity; however, as
in the United States, logistics services providers are bundling services to
offer single-source logistics solutions. Some of our chief competitors in
logistics services are Ryder Logistics, Caliber Logistics, Menlo Logistics, Geo
Logistics, United and UPS Logistics.
Competition for the freight we transport is based in the long term primarily
on service, freight rate, reliability, transit times and scope of operations. In
the United States, competition and the reduction in regulation caused by the
Motor Carrier Act of 1980 has created downward pressure on the logistics
industry's pricing structure.
GOVERNMENT REGULATION
Our operations are subject to various federal, state, local and foreign laws
and regulations that in many instances require permits and licenses. Our U.S.
motor carrier operations as a common and contract carrier are regulated by the
Surface Transportation Board (the "STB") which is an independent, three-member
agency within the U.S. Department of Transportation (the "DOT"). The STB has
jurisdiction similar to the former Interstate Commerce Commission (the "ICC")
which includes issues such as rates, tariffs, antitrust immunity and undercharge
and overcharge claims. The DOT, and in particular the Federal Highway
Administration (the "FHWA") within the DOT, also has jurisdiction over such
matters as safety, the registration of motor carriers, freight forwarders and
brokers, insurance (financial responsibility) matters, financial reporting
requirements and enforcement of leasing and loading and unloading practices. In
addition to motor carrier operations, we also conduct domestic operations as a
licensed or permitted freight forwarder and property broker. Many of the
licenses and permits that we hold were issued by the ICC. When the ICC was
abolished at the end of 1995, jurisdiction over motor carriers was transferred
to the STB and DOT. With respect to interstate motor carrier operations, the
FHWA is the principal
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regulator in terms of safety including issues such as carrier and driver
qualification, drug and alcohol testing of drivers, hours of service
requirements and maintenance and qualification of equipment.
We are an ocean transportation intermediary pursuant to the Shipping Act of
1984, as amended. As such, we hold ocean freight forwarder licenses issued by
the Federal Maritime Commission (the "FMC") and are subject to the FMC bonding
requirements applicable to ocean freight forwarders. We also conduct certain
operations as a non-vessel operating common carrier ("NVOCC") and are subject to
the regulations relating to FMC tariff filing and bonding requirement bonds, and
under the Shipping Act of 1984, particularly with respect to terms thereof
proscribing rebating practices. The FMC does not currently regulate the level of
our fees in any material respect.
Our U.S. customs brokerage activities are licensed by the United States
Department of the Treasury and are regulated by the United States Customs
Service. We are also subject to similar regulations by the regulatory
authorities of foreign jurisdictions in which we operate.
With respect to U.S. state and Canadian provincial licenses, the permitting
and licensing structure largely parallels the U.S. federal licensing regulatory
structure.
In the United States, both NAVL and Allied have been participants in certain
collective activities, including collective ratemaking with other motor carriers
pursuant to an exemption from the antitrust laws as currently set forth in The
Motor Carrier Act of 1980. Over the years, the scope of the antitrust exemption
has decreased and there can be no assurance that such exemption from the
antitrust laws will continue in the future. The loss of such exemption could
result in an adverse effect on our operations or financial condition.
In Europe, including the United Kingdom, we hold "O" (operators) licenses,
international transport licenses and certificates of professional competences.
These licenses are approvals from the relevant local authority permitting the
operation of commercial vehicles from specified bases. One of the pre-requisites
for these licenses is the employment by the relevant business of individuals who
hold certain certificates of professional competence.
The Baxendale Insurance Company Ltd. (licensed in Ireland) and our other
insurance subsidiaries such as TransGuard Insurance Company of America, Inc.
(registered in Illinois) and North American Transport Insurance Company
(registered in Indiana) are subject to extensive supervision and regulation by
insurance regulators in their respective jurisdictions, including regulations
limiting the transfer of assets, loans, or the payments of dividends from such
insurance subsidiaries to their affiliates, including us. Such regulation could
limit our ability to draw on these insurance subsidiaries' assets to repay its
indebtedness, including the notes.
Any violation of the laws and regulations discussed above could increase
claims and/or liabilities, including claims for uninsured punitive damages.
Failure to maintain required permits or licenses, or to comply with applicable
regulations, including environmental permits and regulations could subject us to
fines or, in the event of a serious violation, suspension or revocation of
operating authority or criminal penalties. All of these regulatory authorities
have broad powers generally governing activities such as authority to engage in
motor carrier operations, rates and charges and certain mergers, consolidations
and acquisitions. Although compliance with these regulations has not had a
materially adverse effect on our operations or financial condition in the past,
there can be no assurance that such regulations or any changes to such
regulations will not materially adversely impact our operations in the future.
We are also subject to environmental regulation. See "--Environmental
Matters."
ENVIRONMENTAL MATTERS
Our operations are subject to a range of environmental requirements in the
various foreign, federal, state and local jurisdictions in which we operate. In
particular, because we own or lease or have in the past
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owned or leased facilities at which underground storage tanks are located and
operated, we are subject to regulations governing the design, construction and
operation of underground storage tanks and governing releases from these tanks.
We have incurred, and will continue to incur, costs related to our investigation
and cleanup of releases of materials from underground storage tanks, though such
costs are not expected to have a material adverse effect on our financial
position, results of operations or liquidity.
We have been named as a potentially responsible party ("PRP") in several
environmental cleanup proceedings by federal or state authorities or by other
PRPs. The suits are brought under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, or other federal or state
statutes. Based on all known information, it is estimated that the settlement
cost of each PRP site would not be materially or significantly larger than the
reserves established. It is possible that additional claims or lawsuits
involving known or unknown environmental matters may arise in the future.
We actively monitor our compliance with various U.S. federal, state and
local environmental regulations and management believes that we are presently in
material compliance with all applicable U.S. federal, state and local
environmental laws and regulations. Allied recently began to monitor its
compliance with foreign environmental regulations and management believes that
we are presently in substantial compliance with all applicable foreign
environmental laws and regulations.
We can be expected to continue to incur ongoing capital and operating
expenses to maintain compliance with applicable environmental requirements, to
upgrade existing equipment at its facilities and to meet new regulatory
requirements. While it is not possible to predict with certainty future
environmental compliance requirements, management believes that future
expenditures relating to environmental compliance requirements will not
materially adversely affect our financial condition.
As conditions may exist on our properties related to environmental problems
that are latent or undisclosed, there can be no assurance that we will not incur
liabilities or costs, the amount and materiality of which cannot be reliably
estimated at this time. However, based on our assessment of facts and
circumstances now known, management believes it is unlikely that any identified
matters, either individually or in aggregate, will have a material adverse
effect on our financial position, results of operations, or liquidity.
TRADEMARKS
Our northAmerican-Registered Trademark- and Allied-Registered Trademark-
trademarks are considered two of the most valuable brand names in the van line
industry, and northAmerican and Allied are consistently ranked by Gallup polls
among the top U.S. van lines in terms of brand recognition and customer
satisfaction. The marks northAmerican-Registered Trademark-,
Allied-Registered Trademark-, Home Touch!-Registered Trademark- and
Worldtrac-Registered Trademark- are registered trademarks. Other brand or
product names used in this prospectus are trademarks or registered trademarks of
their respective companies.
We have been highly active in seeking protection for numerous marks and
logos relating to the "northAmerican," "Allied" and "Pickfords" brands. We have
actively contested unauthorized use of the "northAmerican" and "Allied" marks.
We have largely been successful, but in a few exceptional circumstances have
tolerated some third-party use of the mark in transport-related commerce not
directly competitive with our business.
EMPLOYEES
As of December 31, 1999, our workforce comprised approximately 7,000
employees, of which approximately 1,750 were unionized. We believe our
relationships with our employees are good. The unionized employees consisted of
approximately 1,600 employees covered by union agreements in the United Kingdom,
and, management believes, approximately 150 employees in Asia, primarily
Australia, and a small number of U.S. employees in our NAVL logistics business.
We have not experienced any major work stoppages in the 1990s.
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PROPERTIES
We own executive and administrative office space at our headquarters at 5001
U.S. HWY 30 West, Ft. Wayne, Indiana, of approximately 385,676 square feet and
operate warehouse spaces of approximately 211,860 square feet (which is
primarily owned). All the other properties used in our operations consist of
freight forwarding offices and warehouse and distribution facilities. As of
December 31, 1999, we had 314 facilities in 21 countries around the world, 30 of
which were owned and 284 of which were leased. We own or lease major facilities
in Naperville, Illinois, Canada and throughout the United Kingdom, Australia and
New Zealand, and own or lease facilities at significant moving services
locations in many countries throughout the world. The following table sets forth
our owned or leased properties by location.
<TABLE>
<CAPTION>
LOCATION OWNED LEASED TOTAL
- -------- -------- -------- --------
<S> <C> <C> <C>
United States and Canada............................... 5 108 113
Europe................................................. 24 102 126
Australia & New Zealand................................ 1 60 61
Asia (including United Arab Emirates).................. 0 14 14
Total.................................................. 30 284 314
</TABLE>
Management believes that our office, warehouse and distribution facilities are
generally well maintained and suitable to support our current and planned
business needs.
LITIGATION
We are involved from time to time in routine legal matters incidental to our
business. We believe that the resolution of such matters will not have a
material adverse effect on our financial position or results of operations.
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<PAGE>
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information with respect to our
directors and officers as of January 15, 2000.
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- -------- ---------------------------------------------------
<S> <C> <C>
James W. Rogers........................... 48 Chairman of the Board and Director
Michael G. Babiarz........................ 33 Director
Edmund M. Carpenter....................... 57 Director
Kevin J. Conway........................... 40 Director
Robert G. Dettmer......................... 68 Director
Darryl D. Fry............................. 60 Director
Kenneth E. Homa........................... 51 Director
Robert D. Lake............................ 56 Director
David A. Novak............................ 31 Director
Charles P. Pieper......................... 53 Director
Jeffrey P. Gannon......................... 48 President and Chief Executive Officer and Director
Gene Elkins............................... 45 Vice President, Allied and northAmerican Brands
Michael P. Fergus......................... 47 President of Van Line Network
Ralph A. Ford............................. 53 Senior Vice President, General Counsel and
Secretary
J. Michael Gunkel......................... 49 President of Logistics
Jeffrey Kaczka............................ 40 Chief Financial Officer
Bradley McGuire........................... 41 Chief Information Officer
Barry C. Meeks............................ 44 Treasurer
Ronald L. Milewski........................ 48 Vice President, Corporate Controller
Julian Nicholls........................... 48 Managing Director, Moving & Storage Europe
Michael Petersen.......................... 49 Vice President of International Relocation
Kevin Pickford............................ 42 Managing Director, Moving & Storage Asia/Pacific
Peter Schleicher.......................... 56 Managing Director, Logistics Europe
Larry Writt............................... 42 Vice President, Insurance
</TABLE>
JAMES W. ROGERS is a principal of Clayton, Dubilier & Rice, Inc. and a
limited partner of CD&R Associates V Limited Partnership. Mr. Rogers serves as
Chairman and as a director of Alliant Foodservice, Inc. Prior to joining
Clayton, Dubilier & Rice, Inc. in 1998, Mr. Rogers was a Senior Vice President
and a member of the Corporate Executive Council of General Electric Company.
From 1995 to 1998, Mr. Rogers was President and Chief Executive Officer of GE
Industrial Control Systems. Mr. Rogers has an undergraduate degree in economics
from Rutgers College. Mr. Rogers serves as the Chairman of the Board, and is a
Director, of our company.
MICHAEL G. BABIARZ is a principal of Clayton, Dubilier & Rice, Inc. and a
limited partner of CD&R Associates V Limited Partnership. Prior to joining
Clayton, Dubilier & Rice, Inc. in 1996, he worked in mergers and acquisitions at
Drexel Burnham Lambert Incorporated. Mr. Babiarz serves as a director of RACI
Holding, Inc. and Remington Arms Company, Inc. He holds a B.S. in Economics from
the University of Pennsylvania's Wharton School. Mr. Babiarz serves as a
Director of our company.
EDMUND M. CARPENTER is President and Chief Executive Officer of Barnes
Group Inc. and is a former professional employee of Clayton, Dubilier & Rice,
Inc. Mr. Carpenter is also a director of Campbell Soup Company, Dana
Corporation, Texaco Inc. and The Business Council. From 1988 to 1995,
Mr. Carpenter was Chairman and Chief Executive Officer of General Signal
Corporation. Prior to 1988, Mr. Carpenter served as President and Chief
Operating Officer of ITT Corporation. Mr. Carpenter has also served as president
of the Automotive Truck Group at Kelsey Hayes Company and President of Freuhauf
de Brazil.
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<PAGE>
Mr. Carpenter attended the University of Michigan, where he earned both a B.S.E.
and an M.B.A. Mr. Carpenter serves as a Director of our company.
KEVIN J. CONWAY is a principal of Clayton, Dubilier & Rice, Inc. and a
limited partner of CD&R Associates V Limited Partnership. Mr. Conway is also a
director of the Riverwood International Corporation and U.S. Office Products
Company. Prior to joining Clayton, Dubilier & Rice, Inc., he spent ten years
with Goldman, Sachs & Co., where he was elected a partner. He was a senior
member of the Mergers & Acquisitions Department at Goldman, Sachs & Co. and
served as the Chief of Staff of the Investment Banking Division. Mr. Conway is a
graduate of Amherst College, Columbia University School of Business and Columbia
Law School. Mr. Conway serves as a Director of our company.
ROBERT G. DETTMER served as Executive Vice President and Chief Financial
Officer of PepsiCo, Inc. from May 1986 until September 1996. Prior to serving in
such positions, Mr. Dettmer served in a number of management and executive
positions with PepsiCo, Inc. Mr. Dettmer is currently a director of Valero
Energy Corp. and the Harvard Business School Club of New York. Mr. Dettmer has
previously served as Chairman of the Board of American Movers Conference and as
a director of Pantasote, Inc. Mr. Dettmer holds an M.B.A. from Harvard Business
School and a Bachelor of Business and Engineering Administration from
Massachusetts Institute of Technology. Mr. Dettmer serves as a Director of our
company.
DARRYL D. FRY recently retired from his position as Chairman and Chief
Executive Officer of Cytec Industries Inc., which he had held since the spinoff
of Cytec from American Cyanamid Company in 1993. Prior to that time, Mr. Fry
held various executive and management positions with American Cyanamid Company.
Mr. Fry currently serves as a director of Cytec, Fortis Inc. and EPMed Systems.
Mr. Fry earned a B.Sc. degree from the Memorial University of Newfoundland and a
B. Eng. degree in chemical engineering from the Nova Scotia Technical
University. Mr. Fry serves as a Director of our company.
KENNETH E. HOMA is currently on the faculty of Georgetown University School
of Business where he teaches graduate courses in marketing, new product
development and operations. Prior to joining Georgetown, Mr. Homa held various
executive and management positions with Black & Decker and the housewares
division of General Electric Corporation. Mr. Homa has an undergraduate degree
in economics from Princeton University and an M.B.A. from the University of
Chicago, where he was a lecturer in marketing and strategic planning. Mr. Homa
serves as a Director of our company.
ROBERT D. LAKE currently serves as the Chief Operating Officer of Exel
Logistics Worldwide. Previously, Mr. Lake oversaw the Exel Logistics and
Allied/Pickfords operations in the Americas and Asia Pacific as Chief Executive
Officer of NFC International Logistics and Moving Services, Americas & Asia
Pacific. Mr. Lake also serves as a director of NFC plc. Mr. Lake holds a B.S.
degree in Manufacturing Technology from Purdue University and a M.S. degree in
Industrial Administration from Purdue's Krannert School of Management. Mr. Lake
serves as a Director of our company.
DAVID A. NOVAK is a professional employee of Clayton, Dubilier & Rice, Inc.
and a limited partner of CD&R Associates V Limited Partnership. Prior to joining
Clayton, Dubilier & Rice, Inc. in 1997, Mr. Novak worked in the Merchant Banking
and Investment Banking Divisions of Morgan Stanley & Co. Incorporated and for
the Central European Development Corporation. Mr. Novak serves as a director of
CDRJ Investments (Lux) S.A. Mr. Novak is a graduate of Amherst College and has
an M.B.A. from Harvard Business School. Mr. Novak serves as a Director of our
company.
CHARLES P. PIEPER is a principal of Clayton, Dubilier & Rice, Inc. and a
limited partner of CD&R Associates V Limited Partnership. In addition,
Mr. Pieper serves as Chairman, and is a director of, U.S. Office Products
Company and is a director of Alliant Foodservice, Inc. and Dynatech Corporation.
Previously, Mr. Pieper was President and Chief Executive Officer of several
General Electric businesses. Mr. Pieper graduated from Harvard College and holds
an M.B.A. from Harvard Business School. Mr. Pieper serves as a Director of our
company.
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<PAGE>
JEFFREY P. GANNON joined us in 2000 and serves as President and Chief
Executive Officer and is a director of our company. Before joining us,
Mr. Gannon was President and Chief Executive Officer of Zenith Electronics
Company. Prior to joining Zenith in 1998, Mr. Gannon was with General Electric
for 25 years, most recently as Vice President--International Business
Development from 1997 to 1998 and as President and Chief Executive Officer of GE
Lighting Asia Pacific Operations from 1994 to 1997. Mr. Gannon earned a B.E. in
mechanical engineering from Villanova and successfully completed General
Electric's Manufacturing Management Program and its Executive Development
Course. Mr. Gannon is a former director of the American Chamber of Commerce in
Mexico, Goodwill Industries, the Capital Club in Beijing and seventeen General
Electric joint ventures.
GENE ELKINS serves as Vice President of the Allied and northAmerican Brands.
Mr. Elkins has been Allied's Senior Vice President of Transportation since 1998.
Prior to that, he served Allied as Vice President of Operations from 1995 to
1998. Mr. Elkins joined Allied in 1991 as Director of Agency Development. Prior
to joining Allied, Mr Elkins held a variety of executive positions with Bekins
Van Lines. Mr. Elkins received a degree in transportation and traffic management
from the College of Advance Traffic.
MICHAEL P. FERGUS serves as President of Van Line Network. Mr. Fergus has
been President and Chief Executive Officer of Allied Van Lines since 1995.
Mr. Fergus joined Allied in 1973 and held various management positions in the
company including Vice President, Allied International; Senior Vice President,
Operations, and Chief Operating Officer. Mr. Fergus holds a B.S. in
communications from Southern Illinois University and is a member of the World
Trade Club.
RALPH A. FORD joined us in 1999 and serves as Senior Vice President, General
Counsel and Secretary. Previously, Mr. Ford served 18 years in the General
Electric legal department, most recently as General Counsel to GE Industrial
Control Systems. Prior to that, Mr. Ford served as group counsel for Bell &
Howell Company and as an attorney for E.I. duPont deNemours & Co. Mr. Ford
earned a B.A. from Morgan State College and a J.D. from Boston University Law
School.
J. MICHAEL GUNKEL joined us in 1991 and currently serves as President of
Logistics. Before joining us, Mr. Gunkel acted as regional Vice President for
Burlington Air Express from 1989 to 1991 and Regional General Manager for Emery
Worldwide from 1976 to 1989. Mr. Gunkel holds a B.A. in history from Dayton
University. He is an active member of the American Moving and Storage
Association, American Trucking Association and National Industrial
Transportation League. He serves on both the American Moving and Storage
Association Advisory Council and ATA Technical Councils.
JEFFREY KACZKA joined us in 1999 and serves as the Chief Financial Officer.
Before joining us, Mr. Kaczka was Chief Financial Officer of I-NET. Prior to
holding that position, Mr. Kaczka held several financial management positions at
General Electric, including Vice President-Finance of GE Information Services.
He was also a member of the GE Corporate Finance Council. Mr. Kaczka earned a
B.A. in economics from Rutgers College.
BRADLEY MCGUIRE serves as Chief Information Officer. Mr. McGuire joined
Allied Van Lines in 1993 as Vice President of Finance for Allied Canada. In
1996, he assumed the position of Vice President of Finance, Strategy and
Development for NFC North America. In June, 1997, he became Chief Financial
Officer and Chief Information Officer of Allied North America and is currently
Allied's Chief Operating Officer. Prior to joining Allied, Mr. McGuire was with
Price Waterhouse in several management capacities. Mr. McGuire received a
Bachelor of Commerce degree from the University of Alberta and holds a chartered
accountants designation.
BARRY C. MEEKS joined us in 1998 and serves as Treasurer. Previously,
Mr. Meeks served as a Director, Corporate Credit, for General Signal
Corporation. Prior to General Signal, Mr. Meeks held a variety of positions for
over 15 years with Ingersoll-Rand Company, including Director, Corporate Credit
and Trade Finance and Manager, Credit and Financial Services for
Ingersoll-Rand's Construction Equipment Group, Worldwide. Mr. Meeks earned his
bachelor's degree at Ursinus College, his M.B.A. at Rutgers University,
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<PAGE>
and completed the Graduate School of Credit & Financial Management Executive
Program at Dartmouth College.
RONALD L. MILEWSKI joined us in 1990 as Vice President Finance and serves as
Vice President, Corporate Controller. Previously, Mr. Milewski served as Group
Controller at Johnson Controls from 1985 to 1990 and Assistant Controller for
Hoover Universal from 1979 to 1985. Mr. Milewski holds a B.B.A. in accounting
from Eastern Michigan University and is a Certified Public Accountant. He is a
member of the American Institute of Certified Public Accountants and the
American Moving and Storage Association and the ATA Technical Councils.
JULIAN NICHOLLS serves as Managing Director, Moving & Storage Europe.
Mr. Nicholls joined NFC plc in 1996 and most recently was Managing Director of
Moving Services Europe for NFC and a member of the NFC Europe Executive. Prior
to joining NFC, Mr. Nicholls held senior management positions in a range of
service companies, including InterMatrix, PrimeComputervision and BET Plc. At
BET, Nicholls was head of corporate marketing and managing director of BET's
computer services and facilities management businesses. Mr. Nicholls has a B.A.
from Durham University, an M.Sc. from Reading University and earned his M.B.A.
at City University in London. Mr. Nicholls was a director of the NFC Foundation.
MICHAEL PETERSEN serves as Vice President, International Relocation.
Mr. Petersen joined Allied Van Lines in 1977 and has held a variety of
management positions. From 1995 through 1998, Mr. Petersen served as Allied Van
Lines representative on the board of directors of the Household Goods Carrier's
Bureau. Mr. Petersen received a B.S. in business from the University of
Illinois, Chicago Circle Campus.
KEVIN PICKFORD serves as Managing Director, Moving & Storage Asia Pacific.
Mr. Pickford joined NFC in 1978 and has held a variety of senior management
roles. From 1997 until the Allied acquisition, he was Managing Director for
NFC's Asia Pacific Moving Services. Prior to this, he was Managing Director for
Allied Pickfords P/L with responsibility for Australian and New Zealand
operations. Mr. Pickford is a graduate and member of the Chartered Association
of Certified Accountants and additionally holds membership in the Australian
Institute of Company Directors.
PETER SCHLEICHER joined us in 1986 and currently serves as Executive Vice
President, Europe. Prior to that, Mr. Schleicher was President for Global
International Forwarding and held various executive management positions
overseas with Global Van Lines. Mr. Schleicher qualified as a graduate from a
business college specializing in freight forwarding.
LAWRENCE A. WRITT serves as Vice President, Insurance. Mr. Writt joined
Allied Van Lines in 1979 and since 1991 has been President and Chief Executive
Officer of TransGuard Insurance Company of America, Inc. and Vanguard Insurance
Agency, Inc., both wholly owned by subsidiaries of Allied Van Lines. Mr. Writt
is also a director of both TransGuard and Vanguard as well. Mr. Writt has a B.S.
in economics and accounting from St. Joseph's College.
COMPOSITION OF BOARD AND COMMITTEES
The business and affairs of North American Van Lines are managed under the
direction of its Board of Directors. Each of the directors of North American Van
Lines is also a director of Allied Worldwide (the holder of all of North
American Van Lines' outstanding common stock). The Board is composed of 11
directors, none of whom, with the exception of Mr. Gannon, are officers of
Allied Worldwide or North American Van Lines. No director who is (1) an officer
or employee of Clayton, Dubilier & Rice, Inc. at any time that Clayton,
Dubilier & Rice, Inc. is providing consulting services to North American Van
Lines or (2) an officer of North American Van Lines is entitled to receive any
compensation for his services as a director (although he may be reimbursed for
his reasonable expenses in connection with such service). Each director may hold
office until his successor has been duly elected and qualified, or until his
earlier death, resignation or removal.
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<PAGE>
The North American Van Lines Board has established the following committees:
EXECUTIVE COMMITTEE
The Executive Committee may, in the intervals between meetings of the Board,
exercise the powers and authority of the Board in the management of the
property, affairs and business of North American Van Lines.
The Executive Committee currently consists of James W. Rogers (Chairman),
Edmund M. Carpenter and Kevin J. Conway.
COMPENSATION COMMITTEE
The Compensation Committee makes recommendations to the Board regarding
salaries and any supplemental employee compensation of the executive officers
and acts upon management's recommendations for salary and supplemental
compensation for all other employees. The Compensation Committee also acts upon
management's recommendations which require director action with respect to all
employee pension and welfare benefit plans. The Compensation Committee currently
consists of Darryl D. Fry (Chairman), Edmund M. Carpenter, Kenneth E. Homa and
James W. Rogers.
AUDIT COMMITTEE
The Audit Committee recommends to the Board the firm of independent
certified public accountants to annually audit the books and records of North
American Van Lines. The Audit Committee reviews and reports on the activities of
the independent certified public accountants to the Board and reviews and
advises the Board as to the adequacy of North American Van Lines' system of
internal accounting controls. The Audit Committee currently consists of
Robert G. Dettmer (Chairman), Michael G. Babiarz and Kevin J. Conway.
OTHER COMMITTEES
The Board may form such other committees of the Board as it deems
appropriate.
COMPENSATION OF DIRECTORS
Members of the North American Van Lines Board and of the Allied Worldwide
Board who are not employees of North American Van Lines, Allied Worldwide or
Clayton, Dubilier & Rice, Inc. receive an annual retainer fee of $40,000. An
additional annual fee of $10,000 is paid to the chairman of each committee who
is not an employee of North American Van Lines, Allied Worldwide or Clayton,
Dubilier & Rice, Inc. Members of the Allied Worldwide Board do not receive any
additional compensation for their services in such capacity. All directors are
reimbursed for reasonable travel and lodging expenses incurred to attend
meetings.
COMPENSATION OF NAMED EXECUTIVE OFFICERS
The following table describes the compensation paid to (1) the current and
former Chief Executive Officers for services rendered during the fiscal year
ended December 31, 1999, (2) the four other most highly compensated executive
officers for services rendered during the fiscal year ended December 31, 1999,
and (3) two additional individuals, each of whom would have been one of the four
most highly compensated executives but for their departure from North American
Van Lines during the fiscal year 1999 (collectively, the "Named Executives").
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SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION AWARDS
---------------------------
ANNUAL COMPENSATION SECURITIES
------------------------------ OTHER ANNUAL UNDERLYING ALL OTHER
SALARY BONUS COMPENSATION OPTIONS/SARS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($)(5) ($) ($)(6) (#)(7) ($)
- --------------------------- -------- -------- -------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
R. Barry Uber(1) ................ 1999 $500,000 $502,500 -- -- $1,000,000(8)
Director, President and Chief
Executive Officer
James W. Rogers(2) .............. 1999 -- -- -- -- --
Chairman of the Board,
President and Chief Executive
Officer
Ron Milewski .................... 1999 $148,399 $ 85,011 -- 6,000 --
Vice-President and Corporate
Controller
Don Saulic ...................... 1999 $189,999 $ 57,000 -- 1,120 --
Chief Information Officer
Gregory S. Maiers ............... 1999 $175,959 $119,909 $ 694.21 4,500 --
Executive Vice President and
General Manager, Relocation
Services Division
Michael Gunkel .................. 1999 $170,807 $100,000 $ 135.17 5,000 --
Executive Vice President and
General Manager, Logistics
Ian M. Nicolson(3) .............. 1999 $266,586 $234,824 $1,551.75 -- $ 215,040(9)
Chief Operating Officer
Michael Kranisky(4) ............. 1999 $280,460 -- -- -- --
Executive Vice President,
Corporate Development
</TABLE>
- ------------------------
(1) Mr. Uber resigned on December 2, 1999. See "--Separation Agreement with R.
Barry Uber," below.
(2) Mr. Rogers was elected President and Chief Executive Officer on December 2,
1999. Mr. Rogers is a principal of Clayton, Dubilier & Rice, Inc. and a
limited partner of CD&R Associates Fund V Limited Partnership. Mr. Rogers
received no compensation for his services as President and Chief Executive
Officer which continued until the appointment of his successor, Mr. Gannon,
on January 5, 2000 (Mr. Rogers continues to serve as Chairman of the Board).
See "--Employment Agreement with Jeffrey P. Gannon," below.
(3) Mr. Nicolson retired from service on September 1, 1999.
(4) Mr. Kranisky retired from service on April 1, 1999.
(5) Amounts in this column include all amounts contributed by the Named
Executives to the North American Van Lines, Inc. Savings Plan and Trust, a
plan qualified under section 401(k) of the Internal Revenue Code of 1986, as
amended.
(6) Amounts in this column reflect the dollar value of preferential earnings on
compensation deferred at the election of the Named Executives pursuant to
the North American Van Lines' Executives' Deferred Compensation Plan.
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<PAGE>
(7) All options are held under the Allied Worldwide Stock Incentive Plan.
(8) Mr. Uber entered into a separation agreement with Allied Worldwide and North
American Van Lines on December 2, 1999. This figure represents a severance
benefits payment of $1,000,000. See "--Separation Agreement with R. Barry
Uber," below.
(9) This figure represents a severance benefits payment to Mr. Nicolson upon his
retirement.
STOCK OPTION GRANTS AND FISCAL YEAR-END VALUES
The following tables set forth information regarding grants of options to
purchase shares of Allied Worldwide common stock and the fiscal year-end value
of such options, which were granted to the executive officers listed in the
Summary Compensation Table pursuant to the Allied Worldwide Stock Incentive Plan
(described below).
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES PERCENT OF TOTAL
UNDERLYING OPTIONS/SARS
OPTIONS/SARS GRANTED TO EXERCISE OR
GRANTED EMPLOYEES IN BASE PRICE EXPIRATION
NAME (#) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
- ---- ------------ ---------------- ----------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Don Saulic(1)............ 2120 17.99% $118 5/5/2009 $157,324.28 $398,690.61
</TABLE>
- ------------------------
(1) See description of option vesting provisions under "--Allied Worldwide Stock
Incentive Plan," below.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS AT
FISCAL YEAR-END FISCAL YEAR-END
SHARES (#) ($)
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE (#) REALIZED UNEXERCISABLE UNEXERCISABLE
- ---- ------------ -------- --------------------- ----------------
<S> <C> <C> <C> <C>
R. Barry Uber(1)..................... -- $142,254 0/0 0/0
Don Saulic........................... -- -- 0/1,120 $26,880
Ron Milewski......................... -- -- 1,017/4,983 $42,714/$209,286
Gregory S. Maiers.................... -- -- 763/3,737 $32,046/$156,954
Michael Gunkel....................... -- -- 847/4,153 $35,574/$174,426
</TABLE>
- ------------------------
(1) Mr. Uber's 3,387 vested options were purchased from him by Allied Worldwide
based on a market value of $142 per share, resulting in a cash payment to
him of $42 per share.
ALLIED WORLDWIDE STOCK INCENTIVE PLAN
GENERAL
The Allied Worldwide Board administers the Allied Worldwide Stock Incentive
Plan. Under this plan, the Allied Worldwide Board may grant shares and options
to purchase shares to executives, officers and other key employees selected by
the Board. The Allied Worldwide Board may delegate the authority to administer
the plan to the Compensation Committee of the Allied Worldwide Board.
The options allow participants to purchase shares of Allied Worldwide common
stock. A maximum of 300,000 shares may be issued under the plan. Of those
shares, up to 100,000 shares of common stock are
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<PAGE>
permitted to be sold to management and up to 200,000 options may be granted.
Options granted under the plan that are canceled without having been exercised
may be reissued under the plan. As of January 14, 2000, 47,684 shares and 95,868
options were outstanding under the plan.
SHARES
Participants must agree not to sell or otherwise dispose of the shares
purchased under the stock incentive plan, except in compliance with the
Securities Act. In each case, the sale or other disposition must also be made in
compliance with any applicable state and foreign securities laws. If Allied
Worldwide files a registration statement under the Securities Act with respect
to an underwritten public offering of the common stock, participants may not
sell or distribute any shares of common stock to the public during the 20 days
before and the 180 days after the effective date of the registration statement,
other than as part of the public offering.
The foregoing restrictions on transfer will continue following a public
offering of the common stock.
Participants are not permitted to transfer shares purchased at any time
before an underwritten public offering of Allied Worldwide common stock led by
at least one underwriter of nationally recognized standing except under limited
circumstances. Allied Worldwide has no current plans to effect a public
offering. Clayton, Dubilier & Rice Fund V Limited Partnership is the only
stockholder that currently has a right to initiate a public offering.
OPTIONS
Under the stock incentive plan, two options are granted with each share of
Allied Worldwide common stock sold to the officers and other key employees.
Options granted are of two types: service options and performance options.
Service options are vested in equal annual installments on each of the first
five anniversaries of the grant date. Performance options generally become
vested upon achievement of specified cumulative or annual EBITDA targets, except
that, to the extent not vested sooner, they become vested on the ninth
anniversary of the grant date. In addition, the Allied Worldwide Board may
accelerate the exercisability of any option at any time and from time to time.
All options granted expire after ten years from the grant date.
The exercise price of the options equals the fair market value of the common
stock at the date of the grant. Fair market value was determined by the Board
based on an independent appraisal using various financial methodologies.
Grantees who choose to exercise their options must pay whatever taxes are due
upon exercise. To exercise an option, a holder may pay the exercise price in
full in cash or cash equivalents, including by personal check, at the time of
exercise. The exercise price of any options exercised at any time following a
public offering may be paid in full or in part in the form of shares of Allied
Worldwide common stock that have been owned by the holder for at least six
months, based on the fair market value of such shares of common stock on the
date of exercise.
In the event of termination of service with Allied Worldwide or any
subsidiary by reason of death, disability or retirement at age 65, those options
that have vested shall remain exercisable until the first to occur of (1) the
day that is six months after the date of termination of employment or (2) the
expiration of the term of the option. Those options that have not become vested
and exercisable prior to the date of termination of service by reason of death,
disability or retirement at age 65 shall be canceled immediately upon such
termination of employment.
In the event of termination of service with Allied Worldwide or any
subsidiary for cause, then all vested and unvested options held by a grantee
terminate immediately and are not exercisable.
In the event of termination of service with Allied Worldwide or any
subsidiary for any other reason, vested and exercisable options remain
exercisable solely until the first to occur of: (1) the 60th day after the
earliest of the expiration of Clayton, Dubilier & Rice Fund V Limited
Partnership's right to purchase the options and receipt of written notice that
Clayton, Dubilier & Rice Fund V Limited Partnership does not intend to exercise
its right to purchase the options; and (2) the expiration of the term of the
options. Options that have not become vested and exercisable by the date of the
optionee's termination of employment will terminate and will not become
exercisable.
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Upon a "Change in Control" of Allied Worldwide or North American Van Lines
(as defined in the plan), each vested and unvested service option, all vested
performance options and a percentage of the unvested performance options will be
canceled in exchange for a payment in cash of an amount equal to the excess, if
any, of the price paid in the change in control transaction over the exercise
price. All remaining unvested performance options will be canceled. Any payments
made in such event will generally be paid within 30 days after the change in
control and will be made in cash or in shares of capital stock of the acquiror,
as determined by the Allied Worldwide Board. Notwithstanding the foregoing, if
the Allied Worldwide Board determines before the change in control either that
(1) all outstanding options will be honored or assumed by the acquiror or
(2) alternative options with equal or better terms will be made available, the
outstanding options will not be canceled, their vesting and exercisability will
not be accelerated, and there will be no payment in exchange for the options. To
be approved by the Board, any alternative options offered must (1) have
substantially equivalent economic value to the outstanding options and (2) must
have terms which provide, upon the involuntary termination of an optionee's
employment within two years of the Change in Control, for either
(a) unrestricted exercisability and transferability of the alternative options
or (b) a payment in exchange for any alternative options that equals the
difference between the exercise price of such alternative options and the fair
market value of the stock subject to such alternative options at the time of the
involuntary termination.
Options cannot be transferred or assigned by grantees other than by will or
by the laws of descent or to the issuer or Clayton, Dubilier & Rice Fund V
Limited Partnership under their right to purchase options on termination of
employment. In addition, options can be exercised only by a grantee or a
grantee's estate after death.
REPURCHASE PROVISIONS
If the employment of a grantee terminates for any reason before the first
public offering, the issuer and Clayton, Dubilier & Rice Fund V Limited
Partnership each have an option to repurchase all or any portion of any shares
of Allied Worldwide common stock or options to purchase shares of Allied
Worldwide common stock. The issuer and Clayton, Dubilier & Rice Fund V Limited
Partnership are not obligated to purchase securities, except in very limited
circumstances.
If service is terminated by Allied Worldwide or any subsidiary (1) without
cause, (2) by death, disability or retirement at age 65 or (3) by resignation of
the participant, the repurchase price for the stock is its fair market value as
determined in good faith by the Allied Worldwide Board. The purchase price for
any options equals the excess, if any, of (1) the fair market value of the
shares issuable upon exercise of the options purchased over (2) the aggregate
exercise price of the options.
If service is terminated by Allied Worldwide or any subsidiary with cause,
the repurchase price for the stock is the lesser of the fair market value and
the original purchase price. Any options are immediately forfeited.
Participants who have terminated their employment with Allied Worldwide or
any subsidiary are entitled to keep any shares that are not repurchased by the
issuer or Clayton, Dubilier & Rice Fund V Limited Partnership.
Participants have the right to require the issuer to repurchase their shares
if their employment terminates by reason of death, disability or retirement at
age 65.
All repurchase rights and obligations will expire automatically upon the
consummation of a public offering and will not apply to shares offered or sold
in connection with such an offering.
The issuer and Clayton, Dubilier & Rice Fund V Limited Partnership are
entitled to apply any portion of the purchase price of shares or options to
discharge any indebtedness a participant may owe to Allied Worldwide or to North
American Van Lines or indebtedness that is guaranteed by North American Van
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Lines, including, without limitation, indebtedness incurred by such participant
to purchase shares of common stock.
REGISTRATION RIGHTS
Allied Worldwide and Clayton, Dubilier & Rice Fund V Limited Partnership are
parties to a registration and participation agreement, dated as of March 30,
1998. On November 19, 1999, Allied Worldwide and Clayton, Dubilier & Rice Fund V
Limited Partnership amended the registration and participation agreement to add
NFC as a party. This agreement permits holders of securities of Allied Worldwide
who collectively own at least 50% of Allied Worldwide common stock to require
Allied Worldwide to register their securities and pay for such registration
under certain conditions. Because Clayton, Dubilier & Rice Fund V Limited
Partnership holds more than 50% of Allied Worldwide common stock, it is the only
shareholder able to initiate the initial registration. Furthermore, members of
management generally do not have registration rights under the registration and
participation agreement for shares of Allied Worldwide common stock issued upon
exercise of options if Allied Worldwide has registered such shares under the
Securities Act. If Allied Worldwide files a registration statement under the
Securities Act with respect to a public offering of its common stock, members of
management who have previously purchased Allied Worldwide common stock are not
permitted to effect any public sale or distribution of any shares such stock
during the 20 days before and the 180 days after the effective date of the
registration statement (other than as part of the public offering).
EXECUTIVE EMPLOYMENT AGREEMENTS
SEPARATION AGREEMENT WITH R. BARRY UBER
Allied Worldwide, North American Van Lines and R. Barry Uber entered into a
separation agreement which served to terminate his employment agreement with
Allied Worldwide and North American Van Lines and his service as a Director of
Allied Worldwide and North American Van Lines effective as of December 2, 1999.
Under the separation agreement, Mr. Uber will receive his annual base salary
of $500,000 for two additional years. In addition, Allied Worldwide repurchased
from Mr. Uber (1) 10,000 shares of Allied Worldwide common stock and (2) 3,387
vested and exercisable options to purchase shares of Allied Worldwide common
stock based on a fair market value for the stock of $142. Mr. Uber will continue
to receive medical and welfare benefits from the date of termination of service
to the second anniversary thereof as if he had remained in the employ of North
American Van Lines, provided that, if he becomes eligible for a comparable
benefit by reason of his employment, such obligation of North American Van Lines
shall terminate.
Mr. Uber has agreed that during the ten years following termination of his
employment with Allied Worldwide and North American Van Lines, he will refrain
from disclosing confidential information regarding North American Van Lines.
Additionally, for the two years following termination, Mr. Uber will not
(1) participate in any business that is engaged in the business of or that is
otherwise in competition with any business conducted by Allied Worldwide or its
subsidiaries, (2) induce or attempt to induce any employee of North American Van
Lines to leave the employ of Allied Worldwide or North American Van Lines, or
(3) attempt to induce any supplier, distributor or customer of North American
Van Lines or its affiliates to cease doing business with North American Van
Lines.
EMPLOYMENT AGREEMENT WITH JEFFREY P. GANNON
Effective January 5, 2000 Jeffrey Gannon became Allied Worldwide's and North
American Van Lines' President and Chief Executive Officer. He will receive an
annual base salary of $500,000 and participate in the management bonus plan,
with a target annual bonus opportunity up to 100% of his base salary. If
Mr Gannon's employment is terminated without cause, he will continue to receive
his annual base salary
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for one year (or, if earlier, until he obtains other employment). Upon such an
involuntary termination following a change of control he will instead receive a
payment equal to twice his annual base salary, as well as a pro rated bonus for
the year of termination (based on his target opportunity for such year). In
connection with his employment, Mr. Gannon will be afforded the opportunity to
purchase 10,000 shares of Allied Worldwide's Common Stock at $142 per share. It
is expected that Mr. Gannon will also be granted options to purchase up to
30,000 such shares in conjunction with such purchase, half of which will
generally vest over five years based on the passage of time and his continued
employment. The remaining half will vest upon the achievement of specified
cumulative or annual EBITDA targets, except that to the extent not vested
sooner, they will become vested on the ninth anniversary of the grant date.
RETIREMENT PLANS
Allied Worldwide sponsors the NAVL, Inc. Employee Retirement Plan, a funded,
non-contributory defined benefit pension plan covering eligible employees of
North American Van Lines in the United States. Allied Worldwide also sponsors an
excess benefit plan which is an unfunded, non-qualified plan that provides
retirement benefits not otherwise provided under the retirement plan because of
the benefit limitations imposed by Section 415 and 401(a)(17) of the Internal
Revenue Code. The excess benefit plan ensures that an executive receives the
total pension benefit to which he or she would otherwise be entitled, were it
not for such Code limitations.
BENEFITS FOR SERVICES RENDERED THROUGH DECEMBER 31, 1995
For services rendered through December 31, 1995, several formulas are
applicable for determining benefits which have accrued under the retirement plan
and the excess benefit plan. Generally, under each of these formulas the rate of
accrual is greater for the first ten (10) years of service than in later years,
with a cap that applies at either thirty (30) or thirty-five (35) years of
service. The formulas each take into account Social Security benefits payable to
each participant. The following table shows the estimated pension benefits
payable to each of the Named Executives which have accrued under the various
formulas which apply through December 31, 1995.
PENSION PLAN TABLE FOR BENEFITS WHICH HAVE ACCRUED TO
EACH NAMED EXECUTIVE THROUGH DECEMBER 31, 1995
<TABLE>
<CAPTION>
ANNUAL PENSION BENEFIT ACCRUED THROUGH
NAMED EXECUTIVE DECEMBER 31, 1995
- --------------- --------------------------------------
<S> <C>
R. Barry Uber (1).................... --
James W. Rogers (2).................. --
Ron Milewski......................... $23,724
Don Saulic (1)....................... --
Gregory S. Maiers.................... $41,208
Michael Gunkel....................... $18,624
Ian M. Nicolson...................... $84,276
Michael Kranisky..................... $81,480
</TABLE>
- ------------------------
(1) Because they were hired after December 31, 1995, neither Mr. Uber nor
Mr. Saulic are eligible for benefits accrued under the formulas in effect
through that date.
(2) Because he was not compensated for his services, Mr. Rogers did not
participate in either the retirement plan or the excess benefit plan.
BENEFITS FOR SERVICES RENDERED AFTER DECEMBER 31, 1995
For services rendered after December 31, 1995, the retirement plan provides
each eligible employee with retirement benefits based principally on years of
service with North American Van Lines,
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compensation rates over that time, and estimated primary Social Security
benefits. The following table shows the estimated annual pension benefits
payable to a covered participant at normal retirement age (65) under both the
retirement plan and the excess benefit plan. These benefits are based on the
final pay formula contained in the retirement plan which applies to all benefits
which accrue under both plans after December 31, 1995.
PENSION PLAN TABLE FOR
BENEFITS WHICH ACCRUE AFTER DECEMBER 31, 1995
<TABLE>
<CAPTION>
YEARS OF SERVICE
----------------
REMUNERATION 5 10 15 20 25
- ------------ ---------------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$200,000...................... $13,827 $ 27,653 $ 41,480 $ 55,307 $ 69,133
$225,000...................... $15,702 $ 31,403 $ 47,105 $ 62,807 $ 78,508
$250,000...................... $17,577 $ 35,153 $ 52,730 $ 70,307 $ 87,883
$275,000...................... $19,452 $ 38,903 $ 58,355 $ 77,807 $ 97,258
$300,000...................... $21,327 $ 42,653 $ 63,980 $ 85,307 $106,633
$400,000...................... $28,827 $ 57,653 $ 86,480 $115,307 $144,133
$600,000...................... $43,827 $ 87,653 $131,480 $175,307 $219,133
$800,000...................... $58,827 $117,653 $176,480 $235,307 $294,133
$1,000,000.................... $73,827 $147,653 $221,480 $295,307 $369,133
$1,200,000.................... $88,827 $177,653 $266,480 $355,307 $444,133
</TABLE>
Benefits available under the retirement plan and the excess benefit plan
after December 31, 1995 are subject to offset for Social Security benefits.
Compensation taken into account under the plans is the average monthly
compensation paid to a participant during the consecutive 60-month period over
the most recent 120-month period that produces the highest average compensation.
For this purpose, compensation includes the total of base salary and bonus.
Benefits are payable in the form of a straight life annuity or a joint and
survivor annuity. For benefits which accrue under the table (i.e., after
December 31, 1995), as of December 31, 1999 Mr. Uber had 1.75 years of credited
service; Mr. Milewski, Mr. Maiers and Mr. Gunkel each have 4 years of credited
service; and Mr. Saulic has 1.17 years of credited service. As of their
respective retirement dates, Mr. Nicolson had 3.67 years of credited service and
Mr. Kranisky had 3.25 years of credited service.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Board established a Compensation Committee to review all compensation
arrangements for executive officers of North American Van Lines. The individuals
serving on the Compensation Committee during 1999 were Darryl D. Fry (Chairman),
Edmund M. Carpenter, Kenneth E. Homa and James W. Rogers. Both Mr. Babiarz and
Mr. Conway are principals of Clayton, Dubilier & Rice, Inc. and limited partners
of CD&R Associates Fund V Limited Partnership. Clayton, Dubilier & Rice, Inc.
receives an annual fee for management and financial consulting services to North
American Van Lines, including expenses. The consulting fees paid to Clayton,
Dubilier & Rice, Inc. were $400,000 for each of 1998 and 1999. Such consulting
fees will be reviewed on an annual basis. Allied Worldwide and North American
Van Lines have also agreed to indemnify the members of the Boards to the full
extent permitted by Delaware law, and to indemnify Clayton, Dubilier & Rice,
Inc. and Clayton, Dubilier & Rice Fund V Limited Partnership (together with
their respective directors, officers, partners, employees, agents and
controlling persons) against certain liabilities incurred under the federal
securities laws and other laws regulating the business of North American Van
Lines and certain other claims and liabilities with respect to their services
for Allied Worldwide and North American Van Lines.
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OWNERSHIP OF CAPITAL STOCK
Allied Worldwide owns all of the outstanding capital stock of North American
Van Lines. The outstanding capital stock of Allied Worldwide is beneficially
owned as set forth in the following table, which includes information as of
January 14, 2000 as to
(1) each person known to North American Van Lines to own five percent or
more of the common stock of Allied Worldwide,
(2) each director of North American Van Lines,
(3) each executive officer of North American Van Lines listed in the Summary
Compensation Table under "Management" above and
(4) all directors and executive officers of North American Van Lines as a
group.
<TABLE>
<CAPTION>
NUMBER PERCENTAGE
NAME AND ADDRESS OF BENEFICIAL OWNER(1) OF SHARES OF SHARES
- --------------------------------------- --------- ----------
<S> <C> <C>
Clayton, Dubilier & Rice Fund V Limited Partnership(2) ..... 840,402 66.9%
1403 Foulk Road, Suite 106
Wilmington, Delaware 19803
NFC International Holdings (Netherlands II) BV(3) .......... 318,779 25.4%
c/o NFC plc
66 Chiltern Street
London WIM 2LT
England
NAME OF EXECUTIVE OFFICER OR DIRECTOR(4)
- ------------------------------------------------------------
Jeffrey P. Gannon(5)........................................ -- --
Ronald L. Milewski(6)....................................... 4,017 *
Donald B. Saulic(7)......................................... 2,734 *
Gregory S. Maiers(8)........................................ 3,013 *
J. Michael Gunkel(9)........................................ 3,347 *
James W. Rogers............................................. 5,000 *
Micahel G. Babiarz.......................................... -- --
Edmund M. Carpenter......................................... -- --
Kevin J. Conway............................................. -- --
Robert G. Dettmer........................................... 2,500 *
Darryl D. Fry............................................... 2,500 *
Kenneth E. Homa............................................. 2,500 *
Robert D. Lake.............................................. -- --
David A. Novak.............................................. -- --
Charles P. Pieper........................................... -- --
All directors and executive officers as a group
(18 persons)(10).......................................... 34,985 2.8%
</TABLE>
- ------------------------
* Less than 1%
(1) In accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as
amended, a person is deemed a "beneficial owner" of a security if he or she
has or shares the power to vote or direct the voting of such security or the
power to dispose or direct the disposition of such security. A person is
also deemed to be a beneficial owner of any securities which that person has
the right to acquire beneficial ownership of within 60 days. More than one
person may be deemed to be a beneficial owner of the same securities.
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(2) CD&R Associates V Limited Partnership, a Cayman Islands exempted limited
partnership ("Associates V"), is the general partner of Clayton, Dubilier &
Rice Fund V Limited Partnership and has the power to direct Clayton,
Dubilier & Rice Fund V Limited Partnership as to the voting and disposition
of shares held by Clayton, Dubilier & Rice Fund V Limited Partnership. CD&R
Investment Associates II, Inc., a Cayman Island exempted company
("Investment Associates II"), is the managing general partner of Associates
V and has the power to direct Associates V as to its direction of Clayton,
Dubilier & Rice Fund V Limited Partnership's voting and disposition of the
shares held by Clayton, Dubilier & Rice Fund V Limited Partnership. No
person controls the voting and disposition of Investment Associates II with
respect to the shares owned by Clayton, Dubilier & Rice Fund V Limited
Partnership. Each of Associates V and Investment Associates II expressly
disclaims beneficial ownership of the shares owned by Clayton, Dubilier &
Rice Fund V Limited Partnership. The business address for each of Clayton,
Dubilier & Rice Fund V Limited Partnership, Associates V and Investment
Associates II is 1403 Foulk Road, Suite 106, Wilmington, Delaware 19803.
(3) Includes 87,480 shares issuable to NFC International Holdings (Netherlands
II) upon exercise of the warrant received by NFC as part of the
consideration for the sale of the Allied business.
(4) Messrs. Uber, Nicholson and Kranisky have resigned or retired. See
"Management--Compensation of Named Executive Officers" and "--Executive
Employment Agreements--Separation Agreement with R. Barry Uber." None of
them owns shares or holds options to acquire shares.
(5) Mr. Gannon, recently appointed a director and President and Chief Executive
Officer of North American Van Lines, does not currently own any shares or
hold any options to acquire shares. Allied Worldwide expects to offer Mr.
Gannon 10,000 shares and 30,000 options to acquire shares (none of which
options will be exercisable within 60 days) in early 2000.
(6) Includes 1,017 shares issuable to Mr. Milewski upon exercise of options
exercisable within 60 days.
(7) Includes 424 shares issuable to Mr. Saulic upon exercise of options
exercisable within 60 days.
(8) Includes 763 shares issuable to Mr. Maiers upon exercise of options
exercisable within 60 days.
(9) Includes 847 shares issuable to Mr. Gunkel upon exercise of options
exercisable within 60 days.
(10) Includes approximately 3,255 options exercisable within 60 days.
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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands
exempted limited partnership, is a private investment fund managed by Clayton,
Dubilier & Rice, Inc. Amounts contributed to Clayton, Dubilier & Rice Fund V
Limited Partnership by its limited partners are invested at the discretion of
the general partner in equity or equity-related securities of entities formed to
effect leveraged acquisition transactions and in the equity of corporations
where the infusion of capital, coupled with the provision of managerial
assistance by Clayton, Dubilier & Rice, Inc., can be expected to generate
returns on investments comparable to returns historically achieved in leveraged
acquisition transactions. The general partner of Clayton, Dubilier & Rice Fund V
Limited Partnership is Associates V. Associates V has three general partners.
The managing general partner of Associates V is Investment Associates II. The
other general partners of Associates V are CD&R Cayman Investment
Associates, Inc., a Cayman Islands exempted company ("Associates Cayman Inc."),
and CD&R Investment Associates, Inc., a Delaware corporation
("Associates Inc."). Under the partnership agreement of Associates V, all
management authority (other than with respect to the amendment of the
partnership agreement) is vested in Investment Associates II.
Each of James Rogers, Michael Babiarz, Kevin Conway and Charles Pieper, who
are principals of Clayton, Dubilier & Rice, Inc., and limited partners of
Associates V and stockholders of Investment Associates II, is a director of
North American Van Lines. David Novak, who is a professional employee of
Clayton, Dubilier & Rice, Inc. and a limited partner of Associates V, is also a
director of North American Van Lines. In addition, Edmund Carpenter, a director
of North American Van Lines, is a former professional employee of Clayton,
Dubilier & Rice, Inc.
Clayton, Dubilier & Rice, Inc. is a private investment firm that is
organized as a Delaware corporation. Clayton, Dubilier & Rice, Inc. is the
manager of a series of investment funds, including Clayton, Dubilier & Rice Fund
V Limited Partnership, formed to invest in equity or equity-related securities.
Clayton, Dubilier & Rice, Inc. generally assists in structuring, arranging
financing for and negotiating the transactions in which the funds it manages
invest. After the consummation of such transactions, Clayton, Dubilier & Rice,
Inc. generally provides management and financial consulting services to the
companies in which its investment funds have invested during the period of such
funds' investment. Such services include helping such companies to establish
effective banking, legal and other business relationships and assisting
management in developing and implementing strategies for improving the
operational, marketing and financial performance of such companies.
Allied Worldwide, North American Van Lines and Clayton, Dubilier & Rice,
Inc. are parties to a Consulting Agreement, dated as of March 30, 1998, as
amended, pursuant to which Clayton, Dubilier & Rice, Inc. is paid a management
fee ($400,000 annually) for financial advisory and management consulting
services. Allied Worldwide and North American Van Lines have also entered into
an Indemnification Agreement, dated as of March 30, 1998, in favor of Clayton,
Dubilier & Rice, Inc. and Clayton, Dubilier & Rice Fund V Limited Partnership
(together with their respective directors, officers, partners, employees, agents
and controlling persons, the "Indemnitees"), pursuant to which Allied Worldwide
and North American Van Lines have agreed, subject to certain exceptions, to
indemnify and hold harmless the members of the boards of directors of Allied
Worldwide and North American Van Lines to the full extent permitted by Delaware
law, and to indemnify the Indemnitees from and against any suits, claims,
damages or expenses that may be made against or incurred by them under
applicable securities laws in connection with offerings of securities of North
American Van Lines, liabilities to third parties arising out of any action or
failure to act by North American Van Lines, and, except in the case of gross
negligence or intentional misconduct, the provision by Clayton, Dubilier & Rice,
Inc. of management, consulting and financial advisory services.
North American Van Lines has guaranteed loans in an aggregate principal
amount of $1,509,690 (of which $609,690 remains outstanding) to various members
of management in connection with their
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investment in Allied Worldwide, including a $175,000 loan to Mr. Kaczka (of
which the total amount remains outstanding) and two $62,250 loans to Don B.
Saulic (of which the total amount of both remains outstanding). These loans
mature on various dates in 2003 and 2004, and bear interest at the prime rate
plus 1.0%.
An affiliate of NFC, NFC International Holdings (Netherlands II) BV, holds a
Common Stock Purchase Warrant issued by Allied Worldwide in connection with the
Allied aquisition. The warrant entitles the holder to purchase 87,480 shares of
common stock of Allied Worldwide, par value $0.01 per share, at an exercise
price of $400.00 per share. The term of the warrant is five years and it
contains customary anti-dilution protections. In addition, the warrant and any
shares issued upon its exercise are subject to certain transfer restrictions,
including rights of first refusal and drag-along rights in our favor and in
favor of Clayton, Dubilier & Rice Fund V Limited Partnership and hold-back
covenants.
An affiliate of NFC also holds 24,500 shares of junior preferred stock of
Allied Worldwide having an initial liquidation preference of $24.5 million. The
dividend rate on this junior preferred stock is 12.4% compounded quarterly,
although the payment of dividends is subject to the discretion of the Board of
Directors of Allied Worldwide and the ability of Allied Worldwide to pay
dividends is subject to our various debt agreements (including the indenture and
the new senior credit facility). In certain circumstances the junior preferred
stock is exchangeable at the option of Allied Worldwide for subordinated
exchange debentures of Allied Worldwide. Subject to the terms of our debt
agreements (including the indenture and the new senior credit facility
agreements), the junior preferred stock is required to be redeemed on the
eleventh anniversary of its issue date, or upon the occurrence of certain other
events. In addition, Allied Worldwide has a right, subject to the terms of its
debt agreements, to redeem the junior preferred stock at any time after the
first anniversary of its issue date.
Allied Worldwide and NFC are parties to a letter agreement which gives NFC
the right (so long as it or any of its affiliates holds ten percent of the
outstanding shares of Allied Worldwide) to nominate one director to the board of
directors of Allied Worldwide and North American Van Lines. The remaining
members of the boards are appointed by Clayton, Dubilier & Rice Fund V Limited
Partnership. The letter agreement also imposes certain restrictions on the
transfer of the 174,961 shares of common stock of Allied Worldwide held by NFC
International Holdings (Netherlands II), such as rights of first refusal,
drag-along rights and hold-back covenants.
Allied Worldwide and Clayton, Dubilier & Rice Fund V Limited Partnership are
parties to a Registration and Participation Agreement, dated as of March 30,
1998, which permits holders of securities of Allied Worldwide to require Allied
Worldwide to register their securities and pay for such registration under
certain conditions. In connection with the Allied acquisition, this agreement
was amended to include NFC as a party and to accord NFC the right (so long as it
or its affiliate owns 87,480 shares of common stock of Allied Worldwide) to
demand that Allied Worldwide register its securities. In addition, the amendment
allows NFC or such affiliate to participate in the demand rights exercised by
other holders of Allied Worldwide securities and to participate in the rights
accorded to certain accredited investors to buy additional shares from Allied
Worldwide pro rata if Clayton, Dubilier & Rice Fund V Limited Partnership
subscribes for additional shares.
Allied Worldwide and Clayton, Dubilier & Rice Fund V Limited Partnership are
parties to a Stock Subscription Agreement, dated as of March 30, 1998, which
sets forth the terms and conditions of the purchase by Clayton, Dubilier & Rice
Fund V Limited Partnership of 615,050 shares of common stock of Allied
Worldwide. Pursuant to such agreement, Clayton, Dubilier & Rice Fund V Limited
Partnership is entitled to consult with Allied Worldwide with respect to the
operation of Allied Worldwide or any of its subsidiaries at any time, to have
observers attend meetings of the board of directors of Allied Worldwide and to
receive all quarterly and annual financial reports and budgets, as well as other
documents, of Allied Worldwide. In addition, the Stock Subscription Agreement
imposes certain restrictions on the transfer of
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the shares of common stock of Allied Worldwide owned by Clayton, Dubilier & Rice
Fund V Limited Partnership.
On December 1, 1999, pursuant to two Stock Subscription Agreements, each
dated as of November 19, 1999, Clayton, Dubilier & Rice Fund V Limited
Partnership and NFC purchased 225,352 and 56,338 shares of common stock of
Allied Worldwide, respectively. These Stock Subscription Agreements impose
certain restrictions on the transfer of the shares of common stock purchased
thereunder, and provide that the purchasers of such stock are entitled to the
rights and subject to the obligations created under the Registration and
Participation Agreement described above. The proceeds of this stock subscription
were used to repay a $40 million interim loan incurred by Allied Worldwide in
connection with the Allied acquisition. As a result of this stock subscription,
accredited investors who were stockholders of Allied Worldwide at the time of
such subscription, including members of management, are entitled to buy, on a
pro rata basis, additional shares of common stock from Allied Worldwide. The
total number of shares offered to these accredited investors was 27,555. As of
January 14, 2000, the purchase of these shares had not been completed. Upon
completion of the offering of these shares, NFC will have the right to purchase
up to 6,889 additional shares of the common stock of Allied Worldwide.
In connection with the Allied acquisition, in December, 1999, Allied
Worldwide initiated a management stock offering and has sold to certain members
of North American Van Lines' management shares (and options to purchase shares)
of its common stock, pursuant to the Allied Worldwide Stock Incentive Plan. As
of January 14, 2000, members of management had purchased approximately 27,091
shares of such stock and had been granted options to purchase 44,682 additional
shares of such stock pursuant to this management stock offering. Allied
Worldwide currently anticipates making a second management stock offering to
certain members of management in February of 2000. It is anticipated that up to
13,000 shares and 36,000 options to purchase shares will be offered in this
management stock offering. See "Management--Allied Stock Incentive Plan."
North American Van Lines and its subsidiary North American Transport
Insurance Company ("NATIC") are parties to a Management and Cost Allocation
Agreement, dated as of July 18, 1990, pursuant to which North American Van Lines
provides office space and services, telecommunications and computer services,
and legal and accounting services to NATIC on a cost reimbursement basis. This
agreement has been filed with the Indiana Department of Insurance.
Allied Van Lines, Inc.'s wholly-owned subsidiary, TransGuard Insurance
Company of America, Inc., is party to several intercompany agreements, with
Vanguard Insurance Agency, Inc., Allied Van Lines, ClaimGuard, Inc. and
TransGuard General Agency, Inc., governing various matters such as the terms and
conditions of the solicitation of accounts by Vanguard on behalf of TransGuard
and the payment by Allied of certain of TransGuard's operating expenses.
Consistent with Illinois law governing the insurance industry and with the
exception of the payment by TransGuard to Vanguard on a commission basis, all
payments made pursuant to these intercompany agreements are made on a
cost-reimbursement basis, with payment amounts ranging from $0.5 million to
$2.5 million per year.
NFC and its affiliates have agreed to provide certain services to us, such
as information technology and real property services, pursuant to a transition
services agreement entered into in connection with the Allied acquisition. In
addition there are a number of properties in the United Kingdom which are used
both for operations of the moving and storage services businesses which were
acquired by us from NFC and also for operations of other businesses of NFC which
NFC is retaining. To facilitate a smooth transition, certain subsidiaries of NFC
have leased (or subleased as the case may be) portions of those facilities which
such subsidiaries are retaining to Pickfords Limited (a North American Van Lines
subsidiary following the Allied acquisition) for its use in its operations of
the acquired businesses. Similarly, in the case of the shared sites which we
acquired in connection with the Allied acquisition, Pickfords Limited has leased
(or subleased, as the case may be) to certain NFC entities portions of those
facilities for their use in the retained businesses. The terms of these leasing
and subleasing arrangements range from less than one year to up to ten years and
are generally at market rents and conditions.
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DESCRIPTION OF OTHER INDEBTEDNESS
SENIOR CREDIT FACILITY
GENERAL. In connection with the Allied acquisition, we entered into a new
credit facility with a syndicate of financial institutions and The Chase
Manhattan Bank as administrative agent (the "Agent") and Banc of America
Securities LLC as syndication agent. The following summary is a description of
the principal terms of the senior credit agreement and the related documents
governing the facility (the "Credit Documentation") and is subject to and
qualified in its entirety by reference to the Credit Documentation. The senior
credit agreement governing the facility has been filed as an exhibit to the
registration statement of which this prospectus is a part. It is available as
set forth under the heading "Where You Can Find More Information."
The senior credit agreement provides for senior secured credit facilities in
an aggregate principal amount of up to $475.0 million, consisting of (1) a
revolving credit facility in an aggregate principal amount of up to
$150.0 million, (2) a seven-year term loan of $150.0 million (the "Tranche A
Term Loan") and (3) an eight-year term loan of $175.0 million (the "Tranche B
Term Loan"), which will be made available to North American Van Lines. The
revolving credit facility may also be made available to certain foreign
subsidiaries of North American Van Lines (together with North American Van
Lines, the "Borrowers").
USE OF FACILITY. In connection with the closing of the Allied acquisition,
North American Van Lines used the term loans and borrowed under the revolving
credit facility to refinance certain existing indebtedness and as part of the
financing for the Allied acquisition. See "The Allied Acquisition." The
remaining unused commitment under the revolving credit facility will be
available to the Borrowers from time to time for general corporate purposes.
GUARANTEE AND SECURITY. The obligations of North American Van Lines are
guaranteed by Allied Worldwide and certain of the existing and subsequently
acquired or organized domestic subsidiaries of North American Van Lines. In the
event that any foreign subsidiary of North American Van Lines is permitted to
borrow under the senior credit facility, its obligations will be guaranteed by
Allied Worldwide, North American Van Lines, certain of North American Van Lines'
domestic subsidiaries and certain of the subsidiaries (including foreign
subsidiaries) of such foreign subsidiary borrower. North American Van Lines'
obligations under the senior credit facility are secured by substantially all of
the tangible and intangible assets of Allied Worldwide, North American Van Lines
and certain of its domestic subsidiaries, except that (1) the stock or
securities of the foreign subsidiaries of North American Van Lines (other than
any direct first-tier foreign subsidiary of North American Van Lines) is not
required to be pledged to secure these obligations, (2) no more than 65% of the
stock or securities of a direct first-tier foreign subsidiary of North American
Van Lines is required to be pledged to secure these obligations, and (3) no more
than 65% of the stock or securities of any domestic subsidiary of North American
Van Lines that acts as a holding company for foreign subsidiaries of North
American Van Lines is required to be pledged to secure these obligations. In the
event that any foreign subsidiary of North American Van Lines is permitted to
borrow under the senior credit facility, its obligations will be secured by not
more than 65% of the stock of such foreign subsidiary borrower and by
substantially all of the tangible and intangible assets of such foreign
subsidiary borrower, Allied Worldwide, North American Van Lines, certain of
North American Van Lines' domestic subsidiaries and the capital stock of certain
of the subsidiaries (including foreign subsidiaries) of such foreign subsidiary
borrower.
AMORTIZATION; INTEREST; FEES; MATURITY. The term loan obligations under the
senior credit agreement are repayable in quarterly principal payments over seven
years, in the case of the Tranche A Term Loan, or eight years, in the case of
the Tranche B Term Loan. Loans under the revolving credit facility mature on the
seventh anniversary of the initial borrowing. The term loans and loans under the
revolving credit facility bear interest at floating rates based upon the
interest rate option we elect.
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The transaction fees and expenses set forth in the sources and uses of funds
for the Allied acquisition (see "The Allied Acquisition") include transaction
fees payable in connection with the commitments under the senior credit
agreement. In addition, a commitment fee is payable quarterly on the daily
average undrawn portion of the revolving credit facility, in the amount of 0.50%
per annum or less (depending on our financial performance).
PREPAYMENTS. The senior credit agreement permits voluntary prepayment of
the term loans or loans under the revolving credit facility without premium or
penalty except for breakage costs incurred in connection with prepayment during
a euro currency interest period and except as provided for in the next sentence.
Optional prepayments of Tranche B Term loans and any prepayments (whether
optional or mandatory) made as a result of or in connection with a change of
control, or any refinancing of any of the senior credit facilities, shall be at
par plus accrued interest plus a premium. The premium shall initially be 2.0% of
the aggregate principal amount prepaid, declining to 0.0% after the second
anniversary of the closing date. Subject to certain exceptions, mandatory
prepayments will be required to be made from net cash proceeds of certain asset
sales, net cash proceeds of certain debt issuances and 50% of excess cash flow,
such percentage to be reduced to zero upon our achievement of certain
performance criteria.
COVENANTS AND EVENTS OF DEFAULT. The senior credit facility is subject to
covenants that, among other things, restrict our ability to dispose of assets,
incur indebtedness or guarantee obligations, prepay other indebtedness, make
dividends and other restricted payments, create liens, make equity or debt
investments, make acquisitions, modify terms of the indenture, engage in mergers
or consolidations, change the business we conduct, make capital expenditures or
engage in certain transactions with affiliates. In addition, under the senior
credit facility, North American Van Lines is also subject to certain financial
covenants, including the requirement to maintain a minimum interest expense
coverage ratio and a maximum leverage ratio. These financial tests become more
restrictive in future years. The senior credit facility is subject to customary
events of default.
ALLIED WORLDWIDE SENIOR DISCOUNT DEBT
GENERAL. In connection with the Allied acquisition, Allied Worldwide
incurred $35.0 million initial accreted value of unsecured senior discount term
loan borrowings from The Chase Manhattan Bank and Blue Ridge Investments, LLC
(affiliates of the initial purchasers of the old notes). This senior discount
loan will accrete at a rate of 16% per annum from its initial accreted value of
$35.0 million at November 19, 1999. Under the loan agreement relating to the
senior discount loan (the "Senior Discount Loan Agreement"), the lenders
thereunder may, at their option, exchange the senior discount loan for senior
discount notes due 2009 at any time prior to February 17, 2000 (90 days after
the initial closing date), by giving written notice to Allied Worldwide, and if
they have not done so by that date, they will be deemed to have given that
notice on that date. The issuance and delivery of the senior discount notes to
the initial holders thereof (who are expected to be the lenders under the senior
discount loan or affiliates thereof) will be in exchange for, and repayment in
full and cancellation of, the senior discount loan. The initial accreted value
of the senior discount notes will equal the then accreted value of the senior
discount loan. Allied Worldwide will not receive any proceeds from the offering
and sale of the senior discount notes by the initial holders to purchasers.
So long as the Allied Worldwide senior discount debt is held by Blue Ridge
Investments and The Chase Manhattan Bank (or their respective affiliates) as
loans under the Senior Discount Loan Agreement, the senior discount debt may be
redeemed in whole or in part, at a price equal to the accreted value thereof
plus accrued and unpaid interest, if any.
The following is a brief summary of the principal terms of the senior
discount notes, and is subject to and qualified in its entirety by reference to
the indenture by which the senior discount notes will be governed. The senior
discount loan has economic and other substantive terms substantially identical
to those of the senior discount notes.
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PAYMENT. The senior discount notes will accrete until December 1, 2004 at a
rate of 16.00% per annum. Thereafter, the senior discount notes will bear
interest at a rate of 16.00% per annum, payable semi-annually. The senior
discount notes will be senior unsecured obligations of Allied Worldwide, and
will not have the benefit of guarantees.
CHANGE OF CONTROL. Each holder of senior discount notes will be entitled to
require Allied Worldwide, and Allied Worldwide must offer, to repurchase the
senior discount notes held by such holder at a price of 101% of the aggregate
principal amount, or accreted value, as the case may be, thereof, plus accrued
and unpaid interest and liquidated damages, if any, to the date of repurchase,
upon the occurrence of a Change of Control Triggering Event (as defined in the
senior discount notes indenture).
OPTIONAL REDEMPTION. Allied Worldwide may redeem all or a part of the
senior discount notes at the redemption prices set forth in the senior discount
notes indenture plus accrued and unpaid interest, if any, thereon, to the
applicable redemption date. The senior discount notes will not be subject to any
mandatory redemption requirements.
COVENANTS, EVENTS OF DEFAULT AND REGISTRATION RIGHTS. The senior discount
notes will be subject to covenants, events of default and registration
requirements similar to those relating to the notes described in this
prospectus.
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DESCRIPTION OF NOTES
GENERAL
North American Van Lines issued the old notes, and will issue the new notes,
under an indenture, dated as of November 19, 1999, among itself, the initial
Note Guarantors and State Street Bank and Trust Company, as trustee. The
indenture has been filed as an exhibit to the registration statement of which
this prospectus is a part. It is available as set forth under the heading "Where
You Can Find More Information." The terms of the new notes are identical to the
terms of the old notes, except that the new notes will be registered under the
Securities Act, and therefore will not contain restrictions on transfer, will
not contain provisions relating to additional interest, and will contain terms
of an administrative nature that differ from those of the old notes. New notes
will otherwise be treated as notes for the purposes of the indenture.
The following is a summary of the material provisions of the indenture. This
summary does not contain all of the information that may be important to an
investor in the notes. It is subject to, and is qualified in its entirety by
reference to, all the provisions of the indenture, including terms defined in
the indenture and provisions of the Trust Indenture Act of 1939, as amended
("TIA"). Whenever particular defined terms of the indenture not otherwise
defined here are referred to, those defined terms are incorporated here by
reference. For definitions of certain capitalized terms used in the following
summary, see "--Certain Definitions" below. In this summary, "North American Van
Lines" refers only to North American Van Lines, Inc., and its successors under
the indenture and not to any of North American Van Lines, Inc.'s subsidiaries.
The notes will be unsecured obligations of North American Van Lines, ranking
subordinate in right of payment to all Senior Indebtedness of North American Van
Lines.
TERMS OF THE NOTES
The notes will mature on December 1, 2009. Each note will bear interest at a
rate of 13 3/8% per annum from the date of issuance, or from the most recent
date to which interest has been paid or provided for, payable semiannually in
cash on June 1 and December 1 of each year, commencing June 1, 2000, to holders
of record at the close of business on the May 15 or November 15 immediately
preceding the interest payment date. Interest on the notes will accrue from the
date of original issuance or, if interest has already been paid, from the date
it was most recently paid. Interest will be computed on the basis of a 360-day
year comprised of twelve 30-day months.
In addition to the notes offered hereby, North American Van Lines may from
time to time issue additional notes ("Additional Notes") in an aggregate
principal amount equal to the aggregate principal amount of notes issued on the
date of the indenture. Any offering of Additional Notes is subject to the
covenant described below under the caption "--Certain Covenants--Limitation on
Indebtedness." The notes and any Additional Notes subsequently issued under the
indenture would be treated as a single class for all purposes under the
indenture, including, without limitation, waivers, amendments, redemptions and
offers to purchase. North American Van Lines will issue notes in fully
registered form, without coupons, in denominations of $1,000 and integral
multiples thereof. The notes will mature on December 1, 2009.
Except where the context otherwise requires, in this "Description of Notes,"
references to the notes include any old notes or Additional Notes, as well as
the new notes.
METHODS OF RECEIVING PAYMENTS ON THE NOTES
Payments of principal, premium, if any, and interest will be made at the
office or agency of North American Van Lines in the Borough of Manhattan, The
City of New York (which initially shall be the corporate trust office of an
affiliate of the trustee) or the corporate trust office of an affiliate of the
Paying Agent in New York City, except that, at the option of North American Van
Lines, payment of interest may
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be made by check mailed to the address of each registered holder of the notes as
such address appears in the Note Register, or, if a holder has given wire
instructions to North American Van Lines, by wire transfer to a United States
dollar account maintained by the holder with a bank located in New York City.
PAYING AGENT AND REGISTRAR FOR THE NOTES
The trustee will initially act as principal Paying Agent and Registrar at
the corporate trust offices of its affiliate in the City of New York, State of
New York. North American Van Lines may change the Paying Agent or Registrar
without prior notice to the holders, and North American Van Lines or any of its
Subsidiaries may act as Paying Agent or Registrar.
OPTIONAL REDEMPTION
The notes will be redeemable, at North American Van Lines' option, in whole
or in part, and from time to time on and after December 1, 2004 and prior to
maturity. Such redemption may be made upon notice mailed by first-class mail to
each holder's registered address, not less than 30 nor more than 60 days prior
to the redemption date. The notes will be so redeemable at the following
redemption prices (expressed as a percentage of principal amount), plus accrued
interest, if any, to the relevant redemption date (subject to the right of
holders of record on the relevant record date to receive interest due on the
relevant interest payment date), if redeemed during the 12-month period
commencing on December 1 of the years set forth below:
<TABLE>
<CAPTION>
REDEMPTION
PERIOD PRICE
- ------ ----------
<S> <C>
2004........................................................ 106.688%
2005........................................................ 104.458%
2006........................................................ 102.229%
2007 and thereafter......................................... 100.000%
</TABLE>
In addition, at any time and from time to time prior to December 1, 2002,
North American Van Lines at its option may redeem notes in an aggregate
principal amount equal to up to 35% of the original aggregate principal amount
of the notes (including the principal amount of any Additional Notes), with
funds in an aggregate amount (the "Redemption Amount") not exceeding the
aggregate proceeds of one or more Equity Offerings (as defined below) at a
redemption price (expressed as a percentage of principal amount thereof) of
113.375% plus accrued interest, if any, to the redemption date (subject to the
right of holders of record on the relevant record date to receive interest due
on the relevant interest payment date); provided, however, that an aggregate
principal amount of notes equal to at least 65% of the original aggregate
principal amount of the notes (including the principal amount of any Additional
Notes) must remain outstanding after each such redemption. "Equity Offering"
means a sale of Capital Stock (other than Disqualified Stock) (X) that is a sale
of Capital Stock of North American Van Lines, or (Y) proceeds of which in an
amount equal to or exceeding the Redemption Amount are contributed to North
American Van Lines or any of its Restricted Subsidiaries. North American Van
Lines may make such redemption upon notice mailed by first-class mail to each
holder's registered address, not less than 30 nor more than 60 days prior to the
redemption date (but in no event more than 180 days after the completion of the
related Equity Offering).
SELECTION
In the case of any partial redemption, selection of the notes for redemption
will be made by the trustee on a PRO RATA basis, by lot or by such other method
as the trustee in its sole discretion shall deem to be fair and appropriate,
although no note of $1,000 in original principal amount or less will be redeemed
in part. If any note is to be redeemed in part only, the notice of redemption
relating to such note shall state the portion of the principal amount thereof to
be redeemed. A new note in principal amount equal to the
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unredeemed portion thereof will be issued in the name of the holder thereof upon
cancellation of the original note.
NOTE GUARANTEES
On the Issue Date, each Domestic Subsidiary that then guarantees payment by
North American Van Lines of Bank Indebtedness of North American Van Lines will
also guarantee payment of the notes. In addition, after the Issue Date, North
American Van Lines will cause each Domestic Subsidiary that guarantees payment
by North American Van Lines of Bank Indebtedness of North American Van Lines to
execute and deliver to the trustee a supplemental indenture or other instrument
pursuant to which such Subsidiary will guarantee payment of the notes, whereupon
such Subsidiary will become a Note Guarantor for all purposes under the
indenture. North American Van Lines will also have the right to cause any other
Subsidiary so to guarantee payment of the Notes. Note Guarantees will be subject
to release and discharge under certain circumstances prior to payment in full of
the notes. See "--Certain Covenants--Future Note Guarantors."
RANKING
The indebtedness evidenced by the notes is unsecured Senior Subordinated
Indebtedness of North American Van Lines, is subordinated in right of payment,
as set forth in the indenture, to the payment when due in full in cash of all
existing and future Senior Indebtedness of North American Van Lines, including
North American Van Lines' obligations under the Senior Credit Facility, ranks
PARI PASSU in right of payment with all existing and future Senior Subordinated
Indebtedness of North American Van Lines and is senior in right of payment to
all existing and future Subordinated Obligations of North American Van Lines.
The notes are also effectively subordinated to any Secured Indebtedness of North
American Van Lines to the extent of the value of the assets securing such
Indebtedness. However, payment from the money or the proceeds of U.S. Government
Obligations held in any defeasance trust described under "--Defeasance" below is
not subordinated to any Senior Indebtedness or subject to the restrictions
described herein.
At September 25, 1999, on a pro forma basis after giving effect to the
Transactions, Senior Indebtedness consisting of indebtedness for borrowed money
of North American Van Lines was $387.3 million and North American Van Lines had
additional availability of $89.6 million for borrowings under the Senior Credit
Facility, all of which would have been Secured Indebtedness, and no Senior
Subordinated Indebtedness (other than the Indebtedness represented by the notes)
and no Subordinated Obligations. Although the indenture contains limitations on
the amount of additional Indebtedness that North American Van Lines may Incur,
under certain circumstances the amount of such Indebtedness could be substantial
and, in any case, such Indebtedness may be Senior Indebtedness or Secured
Indebtedness. See "--Certain Covenants--Limitation on Indebtedness" below.
The obligations of each Note Guarantor under the Note Guarantee to which it
is a party will be unsecured Guarantor Senior Subordinated Indebtedness of such
Note Guarantor, will be subordinated in right of payment, as set forth in the
indenture, to the payment when due in full in cash of all existing and future
Guarantor Senior Indebtedness of such Note Guarantor, including the Note
Guarantor's obligations under or relating to the Senior Credit Facility, will
rank PARI PASSU in right of payment with all existing and future Guarantor
Senior Subordinated Indebtedness of such Note Guarantor and will be senior in
right of payment to all existing and future Guarantor Subordinated Obligations
of such Note Guarantor. The Note Guarantee of each Note Guarantor will also be
effectively subordinated to any Secured Indebtedness of such Note Guarantor to
the extent of the value of the assets securing such Indebtedness. The terms on
which each Note Guarantee will be subordinated to the prior payment in full of
Guarantor Senior Indebtedness will be substantially identical to those described
below governing the subordination of the notes to the prior payment in full of
Senior Indebtedness.
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A substantial part of the operations of North American Van Lines are
conducted through its Subsidiaries. Claims of creditors of such Subsidiaries
(other than Subsidiaries that are Note Guarantors), including trade creditors,
and claims of preferred shareholders (if any) of such Subsidiaries will have
priority with respect to the assets and earnings of such Subsidiaries over the
claims of creditors of North American Van Lines, including holders of the notes.
The notes, therefore, will be effectively subordinated to creditors (including
trade creditors) and preferred shareholders (if any) of Subsidiaries of North
American Van Lines (other than Subsidiaries that are Note Guarantors). Certain
of the operations of a Note Guarantor may be conducted through Subsidiaries
thereof that are not also Note Guarantors. Claims of creditors of such
Subsidiaries, including trade creditors, and claims of preferred shareholders
(if any) of such Subsidiaries will have priority with respect to the assets and
earnings of such Subsidiaries over the claims of creditors of such Note
Guarantor, including claims under the Note Guarantee of such Note Guarantor.
Such Note Guarantee, therefore, will be effectively subordinated to creditors
(including trade creditors) and preferred shareholders (if any) of such
Subsidiaries. Although the indenture limits the incurrence of Indebtedness
(including preferred stock) by certain of North American Van Lines'
Subsidiaries, such limitation is subject to a number of significant
qualifications. As of September 25, 1999, after giving pro forma effect to the
Transactions, North American Van Lines Subsidiaries (other than Subsidiaries who
became Note Guarantors on the Issue Date) would have had substantial
liabilities, including Indebtedness for borrowed money and other balance sheet
liabilities (including trade payables). No preferred stock of such Subsidiaries
was outstanding at such date. See "--Certain Covenants--Limitation on
Indebtedness" below.
"Senior Indebtedness" means, with respect to North American Van Lines, the
following obligations, whether outstanding on the date of the indenture or
thereafter issued, without duplication:
(A) all Bank Indebtedness,
(B) all obligations in respect of any Receivables Financing, and
(C) all obligations consisting of the principal of and premium, if any, and
accrued and unpaid interest (including interest accruing on or after the
filing of any petition in bankruptcy or for reorganization relating to
North American Van Lines regardless of whether post-filing interest is
allowed in such proceeding) on, and fees and other amounts owing in
respect of, all other Indebtedness of North American Van Lines,
unless, in the instrument creating or evidencing the same or pursuant to which
the same is outstanding, it is expressly provided that the obligations in
respect of such Indebtedness are not senior in right of payment to the notes;
provided, however, that Senior Indebtedness shall not include
(1) any obligation of North American Van Lines to any Subsidiary,
(2) any liability for Federal, state, foreign, local or other taxes owed or
owing by North American Van Lines,
(3) any accounts payable or other liability to trade creditors arising in
the ordinary course of business (including Guarantees thereof or
instruments evidencing such liabilities),
(4) any Indebtedness of North American Van Lines (or Guarantee by North
American Van Lines of any Indebtedness) that is expressly subordinated in
right of payment to any other Indebtedness of North American Van Lines
(or Guarantee by North American Van Lines of any Indebtedness),
(5) any Capital Stock of North American Van Lines or
(6) that portion of any Indebtedness of North American Van Lines that is
Incurred by North American Van Lines in violation of the covenant
described under "--Certain Covenants--Limitation on Indebtedness" (but no
such violation shall be deemed to exist for purposes of this clause (6)
if any holder of such Indebtedness or such holder's representative shall
have received
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an Officer's Certificate of North American Van Lines to the effect that
such Incurrence of such Indebtedness does not (or that the Incurrence by
North American Van Lines of the entire committed amount thereof at the
date on which the initial borrowing thereunder is made would not) violate
such covenant).
If any Senior Indebtedness is disallowed, avoided or subordinated pursuant to
the provisions of Section 548 of Title 11 of the United States Code or any
applicable state fraudulent conveyance law, such Senior Indebtedness
nevertheless will constitute Senior Indebtedness.
Only Indebtedness of North American Van Lines that is Senior Indebtedness
will rank senior to the notes in accordance with the provisions of the
indenture. The notes will in all respects rank PARI PASSU with all other Senior
Subordinated Indebtedness of North American Van Lines. Only Indebtedness of a
Note Guarantor that is Guarantor Senior Indebtedness will rank senior to the
Note Guarantee of such Note Guarantor in accordance with the provisions of the
indenture. Such Note Guarantee will in all respects rank PARI PASSU with all
other Guarantor Senior Subordinated Indebtedness of such Note Guarantor. North
American Van Lines has agreed in the indenture that it will not Incur, directly
or indirectly, any Indebtedness that is expressly subordinated in right of
payment to Senior Indebtedness of North American Van Lines unless such
Indebtedness is PARI PASSU with, or subordinated in right of payment to, the
notes. Each Note Guarantor will agree that it will not Incur, directly or
indirectly, any Indebtedness that is expressly subordinated in right of payment
to Guarantor Senior Indebtedness of such Note Guarantor unless such Indebtedness
is PARI PASSU with, or subordinated in right of payment to, the Note Guarantee
of such Note Guarantor. Unsecured Indebtedness is not deemed to be subordinate
or junior to Secured Indebtedness merely because it is unsecured, and
Indebtedness that is not guaranteed by a particular Person is not deemed to be
subordinate or junior to Indebtedness that is so guaranteed merely because it is
not so guaranteed.
North American Van Lines may not pay principal of, or premium (if any) or
interest on, the notes or make any deposit pursuant to the provisions described
under "--Defeasance" below and may not otherwise purchase, redeem or otherwise
retire any notes (except that holders of notes may receive and retain Permitted
Junior Securities and payments made from the trust described under
"--Defeasance" if the funding of such trust is permitted under the defeasance
section of the indenture) (collectively, "pay the notes") if
(1) any Senior Indebtedness is not paid when due in cash or Cash Equivalents
or
(2) any other default on Senior Indebtedness occurs and the maturity of such
Senior Indebtedness is accelerated in accordance with its terms
(either such event, a "Payment Default") unless, in either case,
(A) the Payment Default has been cured or waived and any such acceleration
has been rescinded in writing or
(B) such Senior Indebtedness has been paid in full in cash or Cash
Equivalents.
However, North American Van Lines may pay the notes without regard to the
foregoing if North American Van Lines and the trustee receive written notice
approving such payment from the Representative for the Designated Senior
Indebtedness with respect to which the Payment Default has occurred and is
continuing.
In addition, during the continuance of any default (other than a Payment
Default) with respect to any Designated Senior Indebtedness pursuant to which
the maturity thereof may be accelerated immediately without further notice
(except such notice as may be required to effect such acceleration) or the
expiration of any applicable grace period (a "Non-payment Default"), North
American Van Lines may not pay the notes for the period specified as follows (a
"Payment Blockage Period") (except that holders of notes may receive and retain
Permitted Junior Securities and payments made from the trust described under
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"--Defeasance" if the funding of such trust is permitted under the defeasance
section of the indenture). The Payment Blockage Period shall commence upon the
receipt by the trustee (with a copy to North American Van Lines) of written
notice (a "Blockage Notice") of such Non-payment Default from the Representative
for such Designated Senior Indebtedness specifying an election to effect a
Payment Blockage Period and shall end on the earliest to occur of the following
events:
(1) 179 days shall have elapsed since such receipt of such Blockage Notice,
(2) the Non-payment Default giving rise to such Blockage Notice is no longer
continuing (and no other Payment Default or Non-payment Default is then
continuing),
(3) such Designated Senior Indebtedness shall have been discharged or repaid
in full in cash or Cash Equivalents or
(4) such Payment Blockage Period shall have been terminated by written
notice to the trustee and North American Van Lines from the Person or
Persons who gave such Blockage Notice.
North American Van Lines shall promptly resume payments on the notes, including
any missed payments, after such Payment Blockage Period ends, unless any Payment
Default otherwise exists. Not more than one Blockage Notice may be given in any
360 consecutive day period, irrespective of the number of defaults with respect
to Designated Senior Indebtedness during such period. In no event may the total
number of days during which any Payment Blockage Period is in effect extend
beyond 179 days from the date of receipt by the trustee of the relevant Blockage
Notice, and there must be a 181 consecutive day period during any 360
consecutive day period during which no Payment Blockage Period is in effect.
No nonpayment default that existed or was continuing on the date of delivery
of any Blockage Notice to the trustee shall be, or be made, the basis for a
subsequent Blockage Notice unless such default shall have been cured or waived
for a period of not less than 90 consecutive days.
Upon any payment or distribution of the assets of North American Van Lines
upon a total or partial liquidation or dissolution or reorganization of or
similar proceeding relating to North American Van Lines or its property, or in a
bankruptcy, insolvency, receivership or similar proceeding relating to North
American Van Lines or its property, the holders of Senior Indebtedness will be
entitled to receive payment in full in cash of the Senior Indebtedness before
the noteholders are entitled to receive any payment (except that holders of
notes may receive and retain Permitted Junior Securities and payments made from
the trust described under "--Defeasance" if the funding of such trust is
permitted under the defeasance section of the indenture) and until the Senior
Indebtedness is paid in full in cash, any payment or distribution to which
noteholders would be entitled but for the subordination provisions of the
indenture will be made to holders of the Senior Indebtedness as their interests
may appear. If a distribution is made to noteholders that due to the
subordination provisions should not have been made to them, such noteholders are
required to hold it in trust for the holders of Senior Indebtedness and pay it
over to them as their interests may appear.
If North American Van Lines fails to make any payment on the notes when due
or within any applicable grace period, whether or not on account of the payment
blockage provisions referred to above, such failure would constitute an Event of
Default under the indenture and would enable the holders of the notes to
accelerate the maturity thereof. See "--Defaults." If payment of the notes is
accelerated because of an Event of Default, North American Van Lines or the
trustee shall promptly notify the holders of the Bank Indebtedness or the
Representative of such holders of the acceleration. Such acceleration will not
be effective until five Business Days after such holders or the Representative
of such holders receive notice of such acceleration. Thereafter, North American
Van Lines may pay the notes only if the subordination provisions of the
indenture otherwise permit payment at that time.
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By reason of such subordination provisions contained in the indenture, in
the event of liquidation, receivership, reorganization or insolvency,
(1) creditors of North American Van Lines that are holders of Senior
Indebtedness may recover more, ratably, than the noteholders,
(2) trade creditors of North American Van Lines that are not holders of
Senior Indebtedness or of Senior Subordinated Indebtedness (including the
notes) may recover less, ratably, than holders of Senior Indebtedness and
may recover more, ratably, than holders of Senior Subordinated
Indebtedness, and
(3) North American Van Lines may be unable to meet its obligations on the
notes.
In addition, as described above, the notes will be effectively subordinated,
with respect to North American Van Lines' Subsidiaries, to the claims of
creditors of those Subsidiaries.
CHANGE OF CONTROL
Upon the occurrence after the Issue Date of a Change of Control (as defined
below) and the failure of the notes to have, on the 30th day after such Change
of Control, a rating of at least BBB- (or equivalent successor rating) by S&P
and a rating of at least Baa3 (or equivalent successor rating) by Moody's (a
"Change of Control Triggering Event"), each holder will have the right to
require North American Van Lines to repurchase all or any part of such holder's
notes at a purchase price in cash equal to 101% of the principal amount thereof,
plus accrued and unpaid interest, if any, to the date of repurchase (subject to
the right of holders of record on the relevant record date to receive interest
due on the relevant interest payment date); provided, however, that North
American Van Lines shall not be obligated to repurchase notes pursuant to this
covenant in the event that it has exercised its right to redeem all of the notes
as described under "--Optional Redemption."
The term "Change of Control" means:
(1) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act), other than one or more Permitted Holders or Holding, is or
becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under
the Exchange Act), directly or indirectly, of more than 50% of the total
voting power of the Voting Stock of North American Van Lines, provided
that so long as North American Van Lines is a Subsidiary of Holding, no
Person shall be deemed to be or become a "beneficial owner" of more than
50% of the total voting power of the Voting Stock of North American Van
Lines unless such Person shall be or become a "beneficial owner" of more
than 50% of the total voting power of the Voting Stock of Holding;
(2) North American Van Lines sells or transfers (in one or a series of
related transactions) all or substantially all of the assets of North
American Van Lines and its Restricted Subsidiaries to another Person
(other than one or more Permitted Holders or Holding or one or more
Subsidiaries thereof); or
(3) during any period of two consecutive years (during which period North
American Van Lines has been a party to the indenture), individuals who at
the beginning of such period were members of the board of directors of
North American Van Lines (together with any new members thereof whose
election by such board of directors or whose nomination for election by
holders of Capital Stock of North American Van Lines was approved by one
or more Permitted Holders or by a vote of a majority of the members of
such board of directors then still in office who were either members
thereof at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to
constitute a majority of such board of directors then in office.
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In the event that, at the time of such Change of Control Triggering Event,
the terms of the Bank Indebtedness restrict or prohibit the repurchase of notes
pursuant to this covenant, then prior to the mailing of the notice to holders
provided for in the immediately following paragraph but in any event not later
than 30 days following the date North American Van Lines obtains actual
knowledge of any Change of Control Triggering Event (unless North American Van
Lines has exercised its right to redeem all the notes as described under
"--Optional Redemption"), North American Van Lines shall
(1) repay in full all Bank Indebtedness or offer to repay in full all Bank
Indebtedness and repay the Bank Indebtedness of each lender who has
accepted such offer or
(2) obtain the requisite consent under the agreements governing the Bank
Indebtedness to permit the repurchase of the notes as provided for in the
immediately following paragraph.
North American Van Lines shall first comply with the provisions of the
immediately preceding sentence before it shall be required to repurchase notes
pursuant to the provisions described below. North American Van Lines' failure to
comply with such provisions or the provisions of the immediately following
paragraph shall constitute an Event of Default described in clause (4) and not
in clause (2) under "--Defaults" below.
Unless North American Van Lines has exercised its right to redeem all the
notes as described under "--Optional Redemption," North American Van Lines
shall, not later than 30 days following the date North American Van Lines
obtains actual knowledge of any Change of Control Triggering Event having
occurred, mail a notice to each holder with a copy to the trustee stating:
(1) that a Change of Control Triggering Event has occurred or may occur and
that such holder has, or upon such occurrence will have, the right to
require North American Van Lines to purchase such holder's notes at a
purchase price in cash equal to 101% of the principal amount thereof,
plus accrued and unpaid interest, if any, to the date of purchase
(subject to the right of holders of record on a record date to receive
interest on the relevant interest payment date);
(2) the circumstances and relevant facts and financial information regarding
such Change of Control;
(3) the repurchase date (which shall be no earlier than 30 days nor later
than 60 days from the date such notice is mailed);
(4) the instructions determined by North American Van Lines, consistent with
this covenant, that a holder must follow in order to have its notes
purchased; and
(5) if such notice is mailed prior to the occurrence of a Change of Control
or Change of Control Triggering Event, that such offer is conditioned on
the occurrence of such Change of Control Triggering Event.
North American Van Lines will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of notes pursuant to this
covenant. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this covenant, North American Van Lines
will comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this covenant by virtue thereof.
The Change of Control Triggering Event purchase feature is a result of
negotiations between North American Van Lines and the initial purchasers. North
American Van Lines has no present plans to engage in a transaction involving a
Change of Control, although it is possible that North American Van Lines would
decide to do so in the future. Subject to the limitations discussed below, North
American Van Lines could, in the future, enter into certain transactions,
including acquisitions, refinancings or recapitalizations, that would not
constitute a Change of Control under the indenture, but that could increase the
amount of
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Indebtedness outstanding at such time or otherwise affect North American Van
Lines' capital structure or credit ratings.
The occurrence of a Change of Control would constitute a default under the
Senior Credit Agreement. Agreements governing future Senior Indebtedness of
North American Van Lines may contain prohibitions of certain events that would
constitute a Change of Control or require such Senior Indebtedness to be
repurchased or repaid upon a Change of Control. Moreover, the exercise by the
holders of their right to require North American Van Lines to repurchase the
notes could cause a default under such agreements, even if the Change of Control
itself does not, due to the financial effect of such repurchase on North
American Van Lines. Finally, North American Van Lines' ability to pay cash to
the holders upon a repurchase may be limited by North American Van Lines' then
existing financial resources. There can be no assurance that sufficient funds
will be available when necessary to make any required repurchases.
The definition of Change of Control includes a phrase relating to the sale
or other transfer of "all or substantially all" of North American Van Lines'
assets, as such phrase is used in the Revised Model Business Corporation Act.
Although there is a developing body of case law interpreting the phrase
"substantially all," there is no precise definition of the phrase under
applicable law. Accordingly, in certain circumstances there may be a degree of
uncertainty in ascertaining whether a particular transaction would involve a
disposition of "all or substantially all" of the assets of North American Van
Lines, and therefore it may be unclear as to whether a Change of Control has
occurred and whether the holders of the notes have the right to require North
American Van Lines to repurchase such notes.
CERTAIN COVENANTS
The indenture contains covenants including, among others, the following:
LIMITATION ON INDEBTEDNESS. (a) North American Van Lines will not, and will
not permit any Restricted Subsidiary to, Incur any Indebtedness; provided,
however, that North American Van Lines or any Note Guarantor may Incur
Indebtedness if on the date of the Incurrence of such Indebtedness, after giving
effect to the Incurrence thereof, the Consolidated Coverage Ratio would be
greater than 2.00:1.00 if such Indebtedness is Incurred on or prior to
December 1, 2001 or 2.25:1.00 if such Indebtedness is Incurred thereafter.
(b) Notwithstanding the foregoing paragraph (a), North American Van Lines
and its Restricted Subsidiaries may Incur the following Indebtedness:
(1) Indebtedness Incurred pursuant to Credit Facilities (including but
not limited to in respect of letters of credit or bankers' acceptances
issued or created thereunder) and (without limiting the foregoing) any
Refinancing Indebtedness in respect thereof, in a maximum principal amount
at any time outstanding (giving effect to any refinancing thereof) not
exceeding in the aggregate the amount equal to the sum of
(A) $475.0 million and
(B) the aggregate amount by which the Borrowing Base determined as of
the date of such Incurrence exceeds $245.0 million
(plus in the case of any refinancing of any Credit Facility or any portion
thereof, the aggregate amount of fees, underwriting discounts, premiums and
other costs and expenses incurred in connection with such refinancing) LESS
the aggregate principal amount of Indebtedness Incurred pursuant to this
clause (b)(1) under the Credit Facilities (or any refinancing thereof) that
is permanently repaid pursuant to the covenant described below under
"--Limitation on Sales of Assets and Subsidiary Stock";
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(2) Indebtedness
(A) of any Restricted Subsidiary to North American Van Lines or
(B) of North American Van Lines or any Restricted Subsidiary to any
Restricted Subsidiary; provided, that any subsequent issuance or
transfer of any Capital Stock of such Restricted Subsidiary to
which such Indebtedness is owed, or other event, that results in
such Restricted Subsidiary ceasing to be a Restricted Subsidiary
or any other subsequent transfer of such Indebtedness (except to
North American Van Lines or a Restricted Subsidiary) will be
deemed, in each case, an Incurrence of such Indebtedness by the
issuer thereof;
(3) Indebtedness represented by the notes (other than Additional Notes),
any Indebtedness (other than the Indebtedness described in clauses (1) or
(2) above) outstanding on the Issue Date and any Refinancing Indebtedness
Incurred in respect of any Indebtedness described in this clause (3) or
paragraph (a) above;
(4) Purchase Money Obligations and Capitalized Lease Obligations, and
any Refinancing Indebtedness with respect thereto, in an aggregate principal
amount at any time outstanding (giving effect to any refinancing thereof)
not exceeding an amount equal to the greater of
(A) $35.0 million and
(B) 5% of Consolidated Tangible Assets;
(5) Indebtedness of any Person that is assumed by North American Van
Lines or any Restricted Subsidiary in connection with its acquisition of
assets from such Person or any Affiliate thereof or is issued and
outstanding on or prior to the date on which such Person was acquired by
North American Van Lines or any Restricted Subsidiary or merged or
consolidated with or into any Restricted Subsidiary (other than Indebtedness
Incurred to finance, or otherwise in connection with, such acquisition),
PROVIDED that on the date of such acquisition, merger or consolidation,
after giving effect thereto, North American Van Lines could Incur at least
$1.00 of additional Indebtedness pursuant to paragraph (a) above; and any
Refinancing Indebtedness with respect to any such Indebtedness;
(6) (A) Guarantees by North American Van Lines or any Restricted
Subsidiary of Indebtedness or any other obligation or liability
of North American Van Lines or any Restricted Subsidiary (other
than any Indebtedness incurred by North American Van Lines or
such Restricted Subsidiary, as the case may be, in violation of
the covenant described under "--Limitation on Indebtedness"), or
(B) without limiting the covenant described under "--Limitation on
Liens," Indebtedness of North American Van Lines or any
Restricted Subsidiary arising by reason of any Lien granted by or
applicable to such Person securing Indebtedness of North American
Van Lines or any Restricted Subsidiary (other than any
Indebtedness incurred by North American Van Lines or such
Restricted Subsidiary, as the case may be, in violation of the
covenant described under "--Limitation on Indebtedness");
(7) Indebtedness of North American Van Lines or any Restricted
Subsidiary
(A) arising from the honoring of a check, draft or similar instrument
of such Person drawn against insufficient funds, provided that
such Indebtedness is extinguished within five Business Days of
its incurrence, or
(B) consisting of guarantees, indemnities, obligations in respect of
earnouts or other purchase price adjustments, or similar
obligations, Incurred in connection with the acquisition or
disposition of any business, assets or Person (including pursuant
to the Allied Acquisition);
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(8) Indebtedness of North American Van Lines or any Restricted
Subsidiary in respect of
(A) letters of credit, bankers' acceptances or other similar
instruments or obligations issued, or relating to liabilities or
obligations incurred, in the ordinary course of business
(including those issued to governmental entities in connection
with self-insurance under applicable workers' compensation
statutes),
(B) completion guarantees, surety, judgment, appeal or performance
bonds, or other similar bonds, instruments or obligations,
provided, or relating to liabilities or obligations incurred, in
the ordinary course of business,
(C) Hedging Obligations entered into for bona fide hedging purposes
in the ordinary course of business,
(D) Management Guarantees,
(E) Agent Guarantees in an aggregate principal amount not exceeding
$10.0 million outstanding at any time, or
(F) the financing of insurance premiums in the ordinary course of
business;
(9) Indebtedness of a Receivables Subsidiary secured by a Lien on all or
part of the assets disposed of in, or otherwise incurred in connection with,
a Financing Disposition, which Indebtedness is, except for Standard
Receivables Obligations, otherwise without recourse to North American Van
Lines or any Restricted Subsidiary of North American Van Lines (other than
any Receivables Subsidiary);
(10) Indebtedness of a Foreign Subsidiary if, on the date of Incurrence
of such Indebtedness, after giving effect to the Incurrence thereof,
(A) the Consolidated Coverage Ratio would be at least 2.25:1.00 and
(B) if, as a result of such Incurrence, such Foreign Subsidiary shall
then become subject to any restriction or limitation (under any
agreement or instrument governing such Indebtedness) on its
ability to pay dividends or make other distributions to North
American Van Lines, the Foreign Subsidiary Coverage Ratio would
be greater than 2.75:1.00;
provided, that if such Indebtedness is not incurred pursuant to the
preceding clause (B), such Indebtedness shall not be amended, modified or
otherwise supplemented such that such Foreign Subsidiary will become subject
to any such restriction or limitation referred to in such clause unless such
Indebtedness could then be Incurred pursuant to such clause; and any
Refinancing Indebtedness with respect to any such Indebtedness;
(11) Indebtedness of North American Van Lines or any Restricted
Subsidiary in an aggregate principal amount at any time outstanding (giving
effect to any refinancing thereof) not exceeding an amount equal to
$45.0 million.
(c) For purposes of determining compliance with, and the outstanding
principal amount of any particular Indebtedness Incurred pursuant to and in
compliance with, this covenant,
(1) any other obligation of the obligor on such Indebtedness (or of any
other Person who could have Incurred such Indebtedness under this covenant)
arising under any Guarantee, Lien or letter of credit, bankers' acceptance
or other similar instrument or obligation supporting such Indebtedness shall
be disregarded to the extent that such Guarantee, Lien or letter of credit,
bankers' acceptance or other similar instrument or obligation secures the
principal amount of such Indebtedness;
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(2) in the event that Indebtedness meets the criteria of more than one
of the types of Indebtedness described in paragraph (b) above, North
American Van Lines, in its sole discretion, shall classify such item of
Indebtedness and only be required to include the amount and type of such
Indebtedness in one of such clauses; and
(3) the amount of Indebtedness issued at a price that is less than the
principal amount thereof shall be equal to the amount of the liability in
respect thereof determined in accordance with GAAP.
(d) For purposes of determining compliance with any Dollar-denominated
restriction on the Incurrence of Indebtedness denominated in a foreign currency,
the Dollar-equivalent principal amount of such Indebtedness Incurred pursuant
thereto shall be calculated based on the relevant currency exchange rate in
effect on the date that such Indebtedness was Incurred, in the case of term
Indebtedness, or first committed, in the case of revolving credit Indebtedness,
provided that
(1) the Dollar-equivalent principal amount of any such Indebtedness
outstanding on the Issue Date shall be calculated based on the relevant
currency exchange rate in effect on the Issue Date,
(2) if such Indebtedness is Incurred to refinance other Indebtedness
denominated in a foreign currency, and such refinancing would cause the
applicable Dollar-denominated restriction to be exceeded if calculated at
the relevant currency exchange rate in effect on the date of such
refinancing, such Dollar-denominated restriction shall be deemed not to have
been exceeded so long as the principal amount of such refinancing
Indebtedness does not exceed the principal amount of such Indebtedness being
refinanced and
(3) the Dollar-equivalent principal amount of Indebtedness denominated
in a foreign currency and Incurred pursuant to the Senior Credit Facility
shall be calculated based on the relevant currency exchange rate in effect
on, at North American Van Lines' option,
(A) the Issue Date,
(B) any date on which any of the respective commitments under the
Senior Credit Facility shall be reallocated between or among
facilities or subfacilities thereunder, or on which such rate is
otherwise calculated for any purpose thereunder, or
(C) the date of such Incurrence.
The principal amount of any Indebtedness Incurred to refinance other
Indebtedness, if Incurred in a different currency from the Indebtedness being
refinanced, shall be calculated based on the currency exchange rate applicable
to the currencies in which such respective Indebtedness is denominated that is
in effect on the date of such refinancing.
LIMITATION ON LAYERING. North American Van Lines shall not Incur any
Indebtedness that is expressly subordinated in right of payment to any Senior
Indebtedness of North American Van Lines, unless such Indebtedness so Incurred
ranks PARI PASSU in right of payment with the notes, or is subordinated in right
of payment to the notes. No Note Guarantor shall Incur any Indebtedness that is
expressly subordinated in right of payment to any Guarantor Senior Indebtedness
of such Note Guarantor, unless such Indebtedness so Incurred ranks PARI PASSU in
right of payment with such Note Guarantor's Note Guarantee, or is subordinated
in right of payment to such Note Guarantor's Note Guarantee. Unsecured
Indebtedness is not deemed to be subordinate or junior to secured Indebtedness
merely because it is unsecured, and Indebtedness that is not guaranteed by a
particular Person is not deemed to be subordinate or junior to Indebtedness that
is so guaranteed merely because it is not so guaranteed.
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LIMITATION ON RESTRICTED PAYMENTS. (a) North American Van Lines shall not,
and shall not permit any Restricted Subsidiary, directly or indirectly, to
(1) declare or pay any dividend or make any distribution on or in
respect of its Capital Stock (including any such payment in connection with
any merger or consolidation to which North American Van Lines or any
Restricted Subsidiary is a party) except
(x) dividends or distributions payable solely in its Capital
Stock (other than Disqualified Stock) and
(y) dividends or distributions payable to North American Van
Lines or any Restricted Subsidiary
(and, in the case of any such Restricted Subsidiary making such dividend or
distribution, to other holders of its Capital Stock on no more than a pro
rata basis, measured by value),
(2) purchase, redeem, retire or otherwise acquire for value any Capital
Stock of North American Van Lines held by Persons other than North American
Van Lines or a Restricted Subsidiary,
(3) purchase, repurchase, redeem, defease or otherwise acquire or retire
for value, prior to scheduled maturity, scheduled repayment or scheduled
sinking fund payment, any Subordinated Obligations (other than a purchase,
redemption, defeasance or other acquisition or retirement for value in
anticipation of satisfying a sinking fund obligation, principal installment
or final maturity, in each case due within one year of the date of such
acquisition or retirement) or
(4) make any Investment (other than a Permitted Investment) in any
Person (any such dividend, distribution, purchase, redemption, repurchase,
defeasance, other acquisition or retirement or Investment being herein
referred to as a "Restricted Payment"), if at the time North American Van
Lines or such Restricted Subsidiary makes such Restricted Payment:
(x) a Default shall have occurred and be continuing (or would result
therefrom);
(y) North American Van Lines could not incur at least an additional
$1.00 of Indebtedness pursuant to paragraph (a) of the covenant described
under "--Limitation on Indebtedness"; or
(z) the aggregate amount of such Restricted Payment and all other
Restricted Payments (the amount so expended, if other than in cash, to be
as determined in good faith by the Board of Directors, whose
determination shall be conclusive) declared or made subsequent to the
Issue Date and then outstanding would exceed the sum of:
(A) 50% of the Consolidated Net Income accrued during the period
(treated as one accounting period) from September 30, 1999 to the
end of the most recent fiscal quarter ending prior to the date of
such Restricted Payment for which consolidated financial
statements of North American Van Lines are available (or, in case
such Consolidated Net Income shall be a negative number, 100% of
such negative number);
(B) the aggregate Net Cash Proceeds and the fair market value of
Qualified Proceeds received (X) by North American Van Lines as
capital contributions to North American Van Lines after the Issue
Date or from the issuance or sale (other than to a Restricted
Subsidiary) of its Capital Stock (other than Disqualified Stock)
after the Issue Date or (Y) by North American Van Lines or any
Restricted Subsidiary from the issuance and sale by North
American Van Lines or any Restricted Subsidiary after the Issue
Date of Indebtedness that shall have been converted into or
exchanged for Capital Stock of North American Van Lines (other
than Disqualified Stock), PLUS the amount of cash and the fair
market value of Qualified Proceeds received by North American Van
Lines or any Restricted Subsidiary upon such conversion or
exchange;
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(C) the aggregate amount equal to the net reduction in Investments in
Unrestricted Subsidiaries resulting from
(1) dividends, distributions, interest payments, return of
capital, repayments of Investments or other transfers of assets
to North American Van Lines or any Restricted Subsidiary from any
Unrestricted Subsidiary (in each case, in the form of cash, Cash
Equivalents or Qualified Proceeds), or
(2) the redesignation of any Unrestricted Subsidiary as a
Restricted Subsidiary (valued in each case as provided in the
definition of "Investment"),
not to exceed in the case of any such Unrestricted Subsidiary the
aggregate amount of Investments (other than Permitted Investments)
made by North American Van Lines or any Restricted Subsidiary in
such Unrestricted Subsidiary after the Issue Date; and
(D) in the case of any disposition or repayment of any Investment (in
each case, in the form of cash, Cash Equivalents or Qualified
Proceeds) constituting a Restricted Payment (without duplication
of any amount deducted in calculating the amount of Investments
at any time outstanding included in the amount of Restricted
Payments), an amount in the aggregate equal to the lesser of the
return of capital, repayment or other proceeds with respect to
all such Investments and the initial amount of all such
Investments.
(b) The provisions of the foregoing paragraph (a) will not prohibit any of
the following (each, a "Permitted Payment"):
(1) any purchase, redemption, repurchase, defeasance or other
acquisition or retirement of Capital Stock of North American Van Lines or
Subordinated Obligations made by exchange (including any such exchange
pursuant to the exercise of a conversion right or privilege in connection
with which cash is paid in lieu of the issuance of fractional shares) for,
or out of the proceeds of the substantially concurrent issuance or sale of,
Capital Stock of North American Van Lines (other than Disqualified Stock and
other than Capital Stock issued or sold to a Subsidiary) or a substantially
concurrent capital contribution to North American Van Lines; provided, that
the Net Cash Proceeds from such issuance, sale or capital contribution shall
be excluded in subsequent calculations under clause (B) of the preceding
paragraph (a);
(2) any purchase, redemption, repurchase, defeasance or other
acquisition or retirement of Subordinated Obligations (x) made by exchange
for, or out of the proceeds of the substantially concurrent issuance or sale
of, Refinancing Indebtedness Incurred in compliance with the covenant
described under "--Limitation on Indebtedness"; (y) from Net Available Cash
to the extent permitted by the covenant described under "--Limitation on
Sales of Assets and Subsidiary Stock"; or (Z) to the extent required by the
agreement governing such Subordinated Obligations only following the
occurrence of a Change of Control Triggering Event (or, in the case of
Acquired Debt, any similar event), but only if in each case, North American
Van Lines shall have complied with the covenant described under "--Change of
Control" and, if required, purchased all notes tendered pursuant to the
offer to repurchase all the notes required thereby, prior to purchasing or
repaying such Subordinated Obligations;
(3) dividends paid within 60 days after the date of declaration thereof
if at such date of declaration such dividend would have complied with the
preceding paragraph (a);
(4) loans, advances, dividends or distributions by North American Van
Lines to Holding to permit Holding to repurchase or otherwise acquire its
Capital Stock (including any options, warrants or other rights in respect
thereof), or payments by North American Van Lines to repurchase or otherwise
acquire Capital Stock (including any options, warrants or other rights in
respect thereof), in each case from Management Investors, such payments,
loans, advances, dividends or distributions not
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to exceed an amount (net of repayments of any such loans or advances equal
to (A) $12.5 million PLUS (B) $2.5 million multiplied by the number of
calendar years that have commenced since the Issue Date PLUS (C) the Net
Cash Proceeds received by North American Van Lines since the Issue Date
from, or as a capital contribution from, the issuance or sale to Management
Investors of Capital Stock (including any options, warrants or other rights
in respect thereof), to the extent such Net Cash Proceeds are not included
in any calculation under clause (3)(B)(x) of the preceding paragraph (a);
(5) the payment by North American Van Lines of, or loans, advances,
dividends or distributions by North American Van Lines to Holding to pay,
dividends on the common stock or equity of North American Van Lines or
Holding following a public offering of such common stock or equity, in an
amount not to exceed in any fiscal year 6% of the aggregate gross proceeds
received by North American Van Lines in or from such public offering;
(6) Restricted Payments (including loans or advances) in an aggregate
amount outstanding at any time not to exceed $10.0 million (net of
repayments of any such loans or advances);
(7) loans, advances, dividends or distributions to Holding or other
payments by North American Van Lines or any Restricted Subsidiary (A) to
satisfy or permit Holding to satisfy obligations under the Management
Agreements, (B) pursuant to the Tax Sharing Agreement, or (C) to pay or
permit Holding to pay any Holding Expenses or any Related Taxes;
(8) payments by North American Van Lines, or loans, advances, dividends
or distributions by North American Van Lines to Holding to make payments, to
holders of Capital Stock of North American Van Lines or Holding in lieu of
issuance of fractional shares of such Capital Stock, not to exceed $100,000
in the aggregate outstanding at any time;
(9) the distribution, as a dividend or otherwise, of Investments in
Unrestricted Subsidiaries (with the exception of Investments in Unrestricted
Subsidiaries acquired pursuant to the definition of Permitted Investments
other than pursuant to clause (17) of such definition);
(10) the Transactions; and
(11) any purchase, redemption, retirement or other acquisition of Capital
Stock that may be deemed to occur upon exercise of stock options, warrants
or similar rights to the extent such Capital Stock represents all or part of
the exercise price thereof;
provided, that
(A) in the case of clauses (3) and (5), the net amount of any such
Permitted Payment shall be included in subsequent calculations of the amount
of Restricted Payments,
(B) in the case of clause (4), 50% of the amount of any such Permitted
Payment shall be included in subsequent calculations of the amount of
Restricted Payments,
(C) in all cases other than pursuant to clauses (A) and (B) immediately
above, the net amount of any such Permitted Payment shall be excluded in
subsequent calculations of the amount of Restricted Payments and
(D) with respect to clauses (5) and (6), no Default or Event of Default
shall have occurred or be continuing at the time of any such Permitted
Payment after giving effect thereto.
LIMITATION ON RESTRICTIONS ON DISTRIBUTIONS FROM RESTRICTED
SUBSIDIARIES. North American Van Lines will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause to exist or become effective
any consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to
(A) pay dividends or make any other distributions on its Capital Stock or
pay any Indebtedness or other obligations owed to North American Van Lines,
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(B) make any loans or advances to North American Van Lines or
(C) transfer any of its property or assets to North American Van Lines,
except any encumbrance or restriction:
(1) pursuant to an agreement or instrument in effect at or entered
into on the Issue Date (including, without limitation, the Senior Credit
Facility), the indenture or the notes;
(2) pursuant to any agreement or instrument of a Person, or relating
to Indebtedness or Capital Stock of a Person, which Person is acquired by
or merged or consolidated with or into North American Van Lines or any
Restricted Subsidiary, or which agreement or instrument is assumed by
North American Van Lines or any Restricted Subsidiary in connection with
an acquisition of assets from such Person, as in effect at the time of
such acquisition, merger or consolidation (except to the extent that such
Indebtedness was incurred to finance, or otherwise in connection with,
such acquisition, merger or consolidation), provided that for purposes of
this clause (2), if another Person is the Successor Company, any
Subsidiary thereof or agreement or instrument of such Person or any such
Subsidiary shall be deemed acquired or assumed, as the case may be, by
North American Van Lines or a Restricted Subsidiary, as the case may be,
when such Person becomes the Successor Company;
(3) pursuant to an agreement or instrument (a "Refinancing
Agreement") effecting a refinancing of Indebtedness Incurred pursuant to,
or that otherwise extends, renews, refunds, refinances or replaces, an
agreement or instrument referred to in clause (1) or (2) of this covenant
or this clause (3) (an "Initial Agreement") or contained in any
amendment, supplement or other modification to an Initial Agreement (an
"Amendment"); provided, however, that the encumbrances and restrictions
contained in any such Refinancing Agreement or Amendment taken as a whole
are not materially less favorable to the holders of the notes than
encumbrances and restrictions contained in the Initial Agreement or
Initial Agreements to which such Refinancing Agreement or Amendment
relates (as determined in good faith by North American Van Lines);
(4) (a) that restricts in a customary manner the subletting,
assignment or transfer of any property or asset that is subject to a
lease, license or similar contract, or the assignment or transfer of any
lease, license or other contract,
(b) by virtue of any transfer of, agreement to transfer, option
or right with respect to, or Lien on, any property or assets of North
American Van Lines or any Restricted Subsidiary not otherwise
prohibited by the indenture,
(c) contained in mortgages, pledges or other security agreements
securing Indebtedness of a Restricted Subsidiary to the extent
restricting the transfer of the property or assets subject thereto,
(d) pursuant to customary provisions restricting dispositions of
real property interests set forth in any reciprocal easement
agreements of North American Van Lines or any Restricted Subsidiary,
(e) pursuant to Purchase Money Obligations that impose
encumbrances or restrictions on the property or assets so acquired,
(f) on cash or other deposits or net worth imposed by customers
under agreements entered into in the ordinary course of business,
(g) pursuant to customary provisions contained in agreements and
instruments entered into in the ordinary course of business
(including but not limited to leases and joint venture and other
similar agreements entered into in the ordinary course of business)
or
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(h) that arises or is agreed to in the ordinary course of
business and does not detract from the value of property or assets of
North American Van Lines or any Restricted Subsidiary in any manner
material to North American Van Lines or such Restricted Subsidiary;
(5) with respect to a Restricted Subsidiary (or any of its property
or assets) imposed pursuant to an agreement entered into for the direct
or indirect sale or disposition of all or substantially all the Capital
Stock or assets of such Restricted Subsidiary (or the property or assets
that are subject to such restriction) pending the closing of such sale or
disposition;
(6) required by any applicable law, rule, regulation or order or by
any regulatory authority having jurisdiction over North American Van
Lines or any Restricted Subsidiary or any of their businesses; or
(7) pursuant to an agreement or instrument (A) relating to any
Indebtedness permitted to be Incurred subsequent to the Issue Date
pursuant to the provisions of the covenant described under "--Limitation
on Indebtedness," if North American Van Lines determines in good faith
that the encumbrances and restrictions contained in the agreements and
instruments relating to such Indebtedness, taken as a whole, are not
materially less favorable to the holders of the notes than encumbrances
and restrictions contained in the agreements and instruments referred to
in clause (1) of this covenant, (B) relating to Indebtedness of a Foreign
Subsidiary incurred pursuant to clause (b)(1) or (b)(10) of the covenant
described under "--Limitation on Indebtedness," (C) relating to a sale of
accounts receivable by a Foreign Subsidiary on customary terms (as
determined in good faith by North American Van Lines) or (D) relating to
Indebtedness of or a Financing Disposition to or by any Receivables
Entity.
LIMITATION ON SALES OF ASSETS AND SUBSIDIARY STOCK. (a) North American Van
Lines will not, and will not permit any Restricted Subsidiary to, make any Asset
Disposition unless
(1) North American Van Lines or such Restricted Subsidiary receives
consideration (including by way of relief from, or by any other Person
assuming responsibility for, any liabilities, contingent or otherwise) at
the time of such Asset Disposition at least equal to the fair market value
of the shares and assets subject to such Asset Disposition, as such fair
market value may be determined (and shall be determined, to the extent such
Asset Disposition or any series of related Asset Dispositions involves
aggregate consideration in excess of $10.0 million) in good faith by the
Board of Directors, whose determination shall be conclusive (including as to
the value of all noncash consideration),
(2) in the case of any Asset Disposition (or series of related Asset
Dispositions) at least 75% of the consideration therefor (excluding, in the
case of an Asset Disposition (or series of related Asset Dispositions) of
assets, any consideration by way of relief from, or by any other Person
assuming responsibility for, any liabilities, contingent or otherwise, that
are not Indebtedness) received by North American Van Lines or such
Restricted Subsidiary is in the form of (a) cash, or (b) Designated Noncash
Assets having an aggregate fair market value, taken together with all other
Designated Noncash Assets received in consideration for Asset Dispositions
pursuant to this clause (b) that are at the time outstanding, not to exceed
the greater of (x) 5% of Consolidated Tangible Assets and
(y) $35.0 million at the time of receipt of such Designated Noncash Assets;
and
(3) an amount equal to 100% of the Net Available Cash from such Asset
Disposition is applied by North American Van Lines (or any Restricted
Subsidiary, as the case may be) as follows:
(A) FIRST, either
(X) to the extent North American Van Lines elects (or is required
by the terms of any Senior Indebtedness or Indebtedness of a
Restricted Subsidiary), to prepay, repay or purchase Senior
Indebtedness or such Indebtedness of a Restricted Subsidiary (in each
case
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other than Indebtedness owed to North American Van Lines or a
Restricted Subsidiary) within 365 days after the date of such Asset
Disposition, or
(Y) to the extent North American Van Lines or such Restricted
Subsidiary elects, to reinvest in Additional Assets (including by
means of an investment in Additional Assets by a Restricted
Subsidiary with Net Available Cash received by North American Van
Lines or another Restricted Subsidiary) within 365 days from the date
of such Asset Disposition;
(B) SECOND, to the extent of the balance of such Net Available Cash
after application in accordance with clause (A) above (such balance, the
"Excess Proceeds"), to make an offer to purchase notes and (to the extent
North American Van Lines or such Restricted Subsidiary elects, or is
required by the terms thereof) to purchase, redeem or repay any other
Senior Subordinated Indebtedness or Guarantor Senior Subordinated
Indebtedness, pursuant and subject to the conditions of the indenture and
the agreements governing such other Indebtedness; and
(C) THIRD, to the extent of the balance of such Net Available Cash
after application in accordance with clauses (A) and (B) above, to fund
(to the extent consistent with any other applicable provision of the
indenture) any general corporate purpose (including but not limited to
the repurchase, repayment or other acquisition or retirement of any
Subordinated Obligations);
provided, however, that in connection with any prepayment, repayment or purchase
of Indebtedness pursuant to clause (A)(x) or (B) above, North American Van Lines
or such Restricted Subsidiary will retire such Indebtedness and will cause the
related loan commitment (if any) to be permanently reduced in an amount equal to
the principal amount so prepaid, repaid or purchased.
Notwithstanding the foregoing provisions of this covenant, North American
Van Lines and the Restricted Subsidiaries shall not be required to apply any Net
Available Cash in accordance with this covenant except to the extent that the
aggregate Net Available Cash from all Asset Dispositions that is not applied in
accordance with this covenant exceeds $15.0 million. If the aggregate principal
amount of notes, Senior Subordinated Indebtedness and Guarantor Senior
Subordinated Indebtedness validly tendered and not withdrawn (or otherwise
subject to purchase, redemption or repayment) in connection with an offer
pursuant to clause (B) above exceeds the Excess Proceeds, the Excess Proceeds
will be apportioned between the notes and such Senior Subordinated Indebtedness
and Guarantor Senior Subordinated Indebtedness, with the portion of the Excess
Proceeds payable in respect of the notes to equal the lesser of:
(x) the Excess Proceeds amount multiplied by a fraction, the numerator
of which is the outstanding principal amount of the notes and the
denominator of which is the sum of the outstanding principal amount of the
notes and the outstanding principal amount of the relevant Senior
Subordinated Indebtedness and Guarantor Senior Subordinated Indebtedness,
and
(y) the aggregate principal amount of notes validly tendered and not
withdrawn.
For the purposes of clause (2) of paragraph (a) above, the following are
deemed to be cash:
(1) Temporary Cash Investments and Cash Equivalents,
(2) the assumption of Indebtedness of North American Van Lines (other
than Disqualified Stock of North American Van Lines) or any Restricted
Subsidiary and the release of North American Van Lines or such Restricted
Subsidiary from all liability on payment of the principal amount of such
Indebtedness in connection with such Asset Disposition,
(3) Indebtedness of any Restricted Subsidiary that is no longer a
Restricted Subsidiary as a result of such Asset Disposition, to the extent
that North American Van Lines and each other
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Restricted Subsidiary are released from any Guarantee of payment of the
principal amount of such Indebtedness in connection with such Asset
Disposition,
(4) securities received by North American Van Lines or any Restricted
Subsidiary from the transferee that are converted by North American Van
Lines or such Restricted Subsidiary into cash within 180 days after the
consummation of such Asset Disposition and
(5) consideration consisting of outstanding Indebtedness of North
American Van Lines or a Restricted Subsidiary which is then retired.
(b) In the event of an Asset Disposition that requires the purchase of notes
pursuant to clause (3)(B) of paragraph (a) above, North American Van Lines will
be required to purchase notes tendered pursuant to an offer by North American
Van Lines for the notes (the "Offer") at a purchase price of 100% of their
principal amount plus accrued and unpaid interest to the Purchase Date in
accordance with the procedures (including prorating in the event of
oversubscription) set forth in the indenture. If the aggregate purchase price of
the notes tendered pursuant to the Offer is less than the Net Available Cash
allotted to the purchase of notes, the remaining Net Available Cash will be
available to North American Van Lines for use in accordance with clause (3)(B)
of paragraph (a) above (to repay Senior Subordinated Indebtedness or Guarantor
Senior Subordinated Indebtedness) or clause (3)(C) of paragraph (a) above. North
American Van Lines shall not be required to make an Offer for notes pursuant to
this covenant if the Net Available Cash available therefor (after application of
the proceeds as provided in clause (3)(A) of paragraph (a) above) is less than
$15.0 million for any particular Asset Disposition (which lesser amounts shall
be carried forward for purposes of determining whether an Offer is required with
respect to the Net Available Cash from any subsequent Asset Disposition).
(c) North American Van Lines will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of notes pursuant to this
covenant. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this covenant, North American Van Lines
will comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this covenant by virtue thereof.
LIMITATION ON TRANSACTIONS WITH AFFILIATES. (a) North American Van Lines
will not, and will not permit any Restricted Subsidiary to, directly or
indirectly, enter into or conduct any transaction or series of related
transactions (including the purchase, sale, lease or exchange of any property or
the rendering of any service) with any Affiliate of North American Van Lines (an
"Affiliate Transaction") unless
(1) the terms of such Affiliate Transaction are not materially less
favorable to North American Van Lines or such Restricted Subsidiary, as the
case may be, than those that could be obtained at the time in a transaction
with a Person who is not such an Affiliate and
(2) if such Affiliate Transaction involves aggregate consideration in
excess of $10.0 million, the terms of such Affiliate Transaction have been
approved by a majority of the Disinterested Directors.
For purposes of this paragraph, any Affiliate Transaction shall be deemed to
have satisfied the requirements set forth in this paragraph if (X) such
Affiliate Transaction is approved by a majority of the Disinterested Directors
or (Y) in the event there are no Disinterested Directors, a fairness opinion is
provided by a nationally recognized appraisal or investment banking firm with
respect to such Affiliate Transaction.
(b) The provisions of the preceding paragraph (a) will not apply to:
(1) any Restricted Payment Transaction,
(2) (A) the entering into, maintaining or performance of any employment
contract, collective bargaining agreement, benefit plan, program or
arrangement, related trust agreement or any
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other similar arrangement for or with any employee, officer or director
heretofore or hereafter entered into in the ordinary course of business,
including vacation, health, insurance, deferred compensation, severance,
retirement, savings or other similar plans, programs or arrangements,
(B) the payment of compensation, performance of indemnification or
contribution obligations, or any issuance, grant or award of stock,
options, other equity-related interests or other securities, to
employees, officers or directors in the ordinary course of business,
(C) the payment of fees to directors of North American Van Lines or
any of its Subsidiaries,
(D) any transaction with an officer or director in the ordinary
course of business not involving more than $100,000 in any one case, or
(E) Management Advances and payments in respect thereof,
(3) any transaction with North American Van Lines, any Restricted
Subsidiary, or any Receivables Entity,
(4) any transaction arising out of agreements or instruments in
existence on the Issue Date, and any payments made pursuant thereto,
(5) execution, delivery and performance of the Tax Sharing Agreement and
Management Agreements, including (A) payment to CDR or any Affiliate of CDR
of a fee of $5.0 million plus out-of-pocket expenses in connection with the
Transactions, and (B) payment to CDR or any Affiliate of CDR of fees of up
to $1.0 million in any fiscal year plus all out-of-pocket expenses incurred
by CDR or any such Affiliate in connection with its performance of
management consulting, monitoring, financial advisory or other services with
respect to North American Van Lines and its Restricted Subsidiaries,
(6) the Transactions, all transactions in connection therewith
(including but not limited to the financing thereof), and all fees or
expenses paid or payable in connection with the Transactions,
(7) any transaction in the ordinary course of business on terms not
materially less favorable to North American Van Lines or the relevant
Restricted Subsidiary than those that could be obtained at the time in a
transaction with a Person who is not an Affiliate of North American Van
Lines, and
(8) any transaction in the ordinary course of business, or approved by a
majority of the Board of Directors, between North American Van Lines or any
Restricted Subsidiary and any Affiliate of North American Van Lines
controlled by North American Van Lines that is a joint venture or similar
entity.
LIMITATION ON LIENS. North American Van Lines shall not, and shall not
permit any Restricted Subsidiary to, directly or indirectly, create or permit to
exist any Lien (other than Permitted Liens) on any of its property or assets
(including Capital Stock of any other Person), whether owned on the date of the
indenture or thereafter acquired, securing any Indebtedness of North American
Van Lines or any Note Guarantor that by its terms is expressly subordinated in
right of payment to or ranks PARI PASSU in right of payment with the notes or
such Note Guarantor's Note Guarantee (the "Initial Lien"), unless
contemporaneously therewith effective provision is made to secure the
Indebtedness due under the indenture and the notes or, in respect of Liens on
any Restricted Subsidiary's property or assets, any Note Guarantee of such
Restricted Subsidiary, equally and ratably with such obligation for so long as
such obligation is so secured by such Initial Lien. Any such Lien thereby
created in favor of the notes or any such Note Guarantee will be automatically
and unconditionally released and discharged upon
(1) the release and discharge of the Initial Lien to which it relates,
or
(2) any sale, exchange or transfer to any Person not an Affiliate of
North American Van Lines of the property or assets secured by such Initial
Lien, or of all of the Capital Stock held by North
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American Van Lines or any Restricted Subsidiary in, or all or substantially
all the assets of, any Restricted Subsidiary creating such Lien.
FUTURE NOTE GUARANTORS. After the Issue Date, North American Van Lines will
cause each Domestic Subsidiary that guarantees payment by North American Van
Lines of Bank Indebtedness of North American Van Lines to execute and deliver to
the trustee a supplemental indenture or other instrument pursuant to which such
Subsidiary will guarantee payment of the notes, whereupon such Subsidiary will
become a Note Guarantor for all purposes under the indenture. In addition, North
American Van Lines may cause any Subsidiary that is not a Note Guarantor so to
guarantee payment of the notes and become a Note Guarantor.
Each Note Guarantor, as primary obligor and not merely as surety, will
jointly and severally, irrevocably and fully and unconditionally Guarantee, on a
senior subordinated basis, the punctual payment when due, whether at Stated
Maturity, by acceleration or otherwise, of all monetary obligations of North
American Van Lines under the indenture and the notes, whether for principal of
or interest on the notes, expenses, indemnification or otherwise (all such
obligations guaranteed by such Note Guarantors being herein called the
"Guaranteed Obligations"). Such Note Guarantor will agree to pay, in addition to
the amount stated above, any and all reasonable out-of-pocket expenses
(including reasonable counsel fees and expenses) incurred by the trustee or the
holders in enforcing any rights under its Note Guarantee.
The obligations of each Note Guarantor will be limited to the maximum
amount, as will, after giving effect to all other contingent and fixed
liabilities of such Note Guarantor, result in the obligations of such Note
Guarantor under the Note Guarantee not constituting a fraudulent conveyance or
fraudulent transfer under applicable law, or being void or unenforceable under
any applicable law, including any law relating to insolvency of debtors.
Each such Note Guarantee shall be a continuing Guarantee and shall:
(1) remain in full force and effect until payment in full of the
principal amount of all outstanding notes (whether by payment at maturity,
purchase, redemption, defeasance, retirement or other acquisition) and all
other Guaranteed Obligations then due and owing, unless earlier terminated
as described below,
(2) be binding upon such Note Guarantor and
(3) inure to the benefit of and be enforceable by the trustee, the
holders and their permitted successors, transferees and assigns.
Notwithstanding the preceding paragraph, any Note Guarantor will
automatically and unconditionally be released from all obligations under its
Note Guarantee, and such Note Guarantee shall thereupon terminate and be
discharged and of no further force or effect,
(1) concurrently with any sale or disposition (by merger or otherwise)
of any Note Guarantor or any interest therein in accordance with the terms
of the indenture (including the covenant described under "--Certain
Covenants--Limitation on Sales of Assets and Subsidiary Stock") by North
American Van Lines or a Restricted Subsidiary, following which such Note
Guarantor is no longer a Restricted Subsidiary of North American Van Lines,
(2) pursuant to the terms of its Note Guarantee,
(3) at any time that such Note Guarantor is released from all of its
obligations under all of its Guarantees of payment by North American Van
Lines of Bank Indebtedness of North American Van Lines,
(4) upon the merger or consolidation of any Note Guarantor with and into
North American Van Lines or another Note Guarantor that is the surviving
Person in such merger or consolidation,
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(5) upon legal or covenant defeasance of North American Van Lines'
obligations, or satisfaction and discharge of the indenture, or
(6) subject to customary contingent reinstatement provisions, upon
payment in full of the aggregate principal amount of all notes then
outstanding and all other Guaranteed Obligations then due and owing.
In addition, North American Van Lines will have the right, upon 30 days' notice
to the trustee, to cause any Note Guarantor that has not guaranteed payment by
North American Van Lines of any Bank Indebtedness of North American Van Lines to
be unconditionally released from all obligations under its Note Guarantee, and
such Note Guarantee shall thereupon terminate and be discharged and of no
further force or effect. Upon any such occurrence specified in this paragraph,
the trustee shall execute any documents reasonably required in order to evidence
such release, discharge and termination in respect of such Note Guarantee.
Neither North American Van Lines nor any such Note Guarantor shall be
required to make a notation on the notes to reflect any such Guarantee or any
such release, termination or discharge.
SEC REPORTS. Notwithstanding that North American Van Lines may not be
required to be or remain subject to the reporting requirements of Section 13(a)
or 15(d) of the Exchange Act, North American Van Lines will file with the SEC
(unless such filing is not permitted under the Exchange Act or by the SEC), so
long as notes are outstanding, the annual reports, information, documents and
other reports that North American Van Lines is required to file with the
Commission pursuant to such Section 13(a) or 15(d) or would be so required to
file if North American Van Lines were so subject. North American Van Lines will
also, within 15 days after the date on which North American Van Lines was so
required to file or would be so required to file if North American Van Lines
were so subject (or, if later, 120 days after the Issue Date), transmit by mail
to all holders, as their names and addresses appear in the Note Register, and to
the trustee copies of any such information, documents and reports (without
exhibits) so required to be filed (or, in lieu of one or more of the annual
reports for the fiscal year ended December 25, 1999 and the quarterly reports
for the following fiscal year, a registration statement filed with the SEC under
the Securities Act or any amendment thereto, provided such registration
statement or amendment contains the information that would have been included in
each such report). North American Van Lines will be deemed to have satisfied
such requirements if Holding files and provides reports, documents and
information of the types otherwise so required, in each case within the
applicable time periods, and North American Van Lines is not required to file
such reports, documents and information separately under the applicable rules
and regulations of the SEC (after giving effect to any exemptive relief) because
of the filings by Holding. North American Van Lines also will comply with the
other provisions of TIA Section 314(a).
MERGER AND CONSOLIDATION
North American Van Lines will not consolidate with or merge with or into, or
convey, transfer or lease all or substantially all its assets to, any Person,
unless:
(1) the resulting, surviving or transferee Person (the "Successor
Company") will be a Person organized and existing under the laws of the
United States of America, any State thereof or the District of Columbia and
the Successor Company (if not North American Van Lines) will expressly
assume all the obligations of North American Van Lines under the notes and
the indenture by executing and delivering to the trustee a supplemental
indenture or one or more other documents or instruments in form reasonably
satisfactory to the trustee;
(2) immediately after giving effect to such transaction (and treating
any Indebtedness that becomes an obligation of the Successor Company or any
Restricted Subsidiary as a result of such transaction as having been
Incurred by the Successor Company or such Restricted Subsidiary at the time
of such transaction), no Default will have occurred and be continuing;
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(3) immediately after giving effect to such transaction, the Successor
Company could Incur at least $1.00 of additional Indebtedness pursuant to
paragraph (a) of the covenant described under "--Certain
Covenants--Limitation on Indebtedness";
(4) each Note Guarantor (other than any party to any such consolidation
or merger) shall have delivered a supplemental indenture or other document
or instrument in form reasonably satisfactory to the trustee, confirming its
Note Guarantee; and
(5) North American Van Lines will have delivered to the trustee an
Officer's Certificate and an Opinion of Counsel, each to the effect that
such consolidation, merger or transfer complies with the provisions
described in this paragraph, provided that (x) in giving such opinion such
counsel may rely on an Officer's Certificate as to compliance with the
foregoing clauses (2) and (3) and as to any matters of fact, and (y) no
Opinion of Counsel will be required for a consolidation, merger or transfer
described in the last paragraph of this covenant.
Any Indebtedness that becomes an obligation of North American Van Lines or any
Restricted Subsidiary (or that is deemed to be Incurred by any Restricted
Subsidiary that becomes a Restricted Subsidiary) as a result of any such
transaction undertaken in compliance with this covenant, and any Refinancing
Indebtedness with respect thereto, shall be deemed to have been Incurred in
compliance with the covenant described under "--Certain Covenants--Limitation on
Indebtedness."
The Successor Company will succeed to, and be substituted for, and may
exercise every right and power of, North American Van Lines under the indenture,
and thereafter the predecessor Company shall be relieved of all obligations and
covenants under the indenture.
Clauses (2) and (3) of the first paragraph of this "Merger and
Consolidation" section will not apply to any transaction in which
(a) any Restricted Subsidiary consolidates with, merges into or
transfers all or part of its assets to North American Van Lines or
(b) North American Van Lines consolidates or merges with or into or
transfers all or substantially all its properties and assets to (X) an
Affiliate incorporated or organized for the purpose of reincorporating or
reorganizing North American Van Lines in another jurisdiction or changing
its legal structure to a corporation or other entity or (Y) a Restricted
Subsidiary of North American Van Lines so long as all assets of North
American Van Lines and the Restricted Subsidiaries immediately prior to such
transaction (other than Capital Stock of such Restricted Subsidiary) are
owned by such Restricted Subsidiary and its Restricted Subsidiaries
immediately after the consummation thereof.
DEFAULTS
An Event of Default is defined in the indenture as:
(1) a default in any payment of interest on any note when due, continued
for 30 days,
(2) a default in the payment of principal of any note when due, whether
at its Stated Maturity, upon optional redemption, upon required repurchase,
upon declaration or otherwise, whether or not such payment is prohibited by
the provisions described under "--Ranking" above,
(3) the failure by North American Van Lines to comply for 30 days after
notice with its obligations under the covenant described under "--Merger and
Consolidation" above,
(4) the failure by North American Van Lines to comply for 30 days after
notice with any of its obligations under the covenant described under
"--Change of Control" above (other than a failure to purchase notes),
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(5) the failure by North American Van Lines to comply for 60 days after
notice with its other agreements contained in the notes or the indenture,
(6) the failure by any Note Guarantor to comply for 45 days after notice
with its obligations under its Note Guarantee,
(7) the failure by North American Van Lines or any Significant
Subsidiary to pay any Indebtedness within any applicable grace period after
final maturity or the acceleration of any such Indebtedness by the holders
thereof because of a default, if the total amount of such Indebtedness so
unpaid or accelerated exceeds $15.0 million or its foreign currency
equivalent (the "cross acceleration provision"),
(8) certain events of bankruptcy, insolvency or reorganization of North
American Van Lines or a Significant Subsidiary (the "bankruptcy
provisions"),
(9) the rendering of any judgment or decree for the payment of money in
an amount (net of any insurance or indemnity payments actually received in
respect thereof prior to or within 90 days from the entry thereof, or to be
received in respect thereof in the event any appeal thereof shall be
unsuccessful) in excess of $15.0 million or its foreign currency equivalent
against North American Van Lines or a Significant Subsidiary that is not
discharged, or bonded or insured by a third Person, if such judgment or
decree remains outstanding for a period of 90 days following such judgment
or decree and is not discharged, waived or stayed (the "judgment default
provision"),
(10) the failure of any Note Guarantee by a Note Guarantor that is a
Significant Subsidiary to be in full force and effect (except as
contemplated by the terms thereof or of the indenture) or the denial or
disaffirmation in writing by any Note Guarantor that is a Significant
Subsidiary of its obligations under its Note Guarantee, if such Default
continues for 10 days, or
(11) the failure of Holding to consummate the Holding Stock Issuance on
or before December 31, 1999.
The foregoing will constitute Events of Default whatever the reason for any
such Event of Default and whether it is voluntary or involuntary or is effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body.
However, a Default under clause (3), (4), (5) or (6) will not constitute an
Event of Default until the trustee or the holders of at least 25% in principal
amount of the outstanding notes notify North American Van Lines of the Default
and North American Van Lines does not cure such Default within the time
specified in such clause after receipt of such notice.
If an Event of Default (other than a Default relating to certain events of
bankruptcy, insolvency or reorganization of North American Van Lines) occurs and
is continuing, the trustee by notice to North American Van Lines, or the holders
of at least a majority in principal amount of the outstanding notes by notice to
North American Van Lines and the trustee, may declare the principal of and
accrued but unpaid interest on all the notes to be due and payable, provided
that so long as any Bank Indebtedness shall be outstanding, such acceleration
shall not be effective until the earlier to occur of:
(x) five Business Days following delivery of a written notice of such
acceleration of the notes to North American Van Lines and the holders of all
Bank Indebtedness or each Representative thereof and
(y) the acceleration of any Bank Indebtedness. Upon the effectiveness of
such a declaration, such principal and interest will be due and payable
immediately.
Notwithstanding the foregoing, if an Event of Default relating to certain events
of bankruptcy, insolvency or reorganization of North American Van Lines occurs
and is continuing, the principal of and accrued interest on all the notes will
become immediately due and payable without any declaration or other act on
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the part of the trustee or any holders. Under certain circumstances, the holders
of a majority in principal amount of the outstanding notes may rescind any such
acceleration with respect to the notes and its consequences.
Notwithstanding the foregoing, in the event of a declaration of acceleration
in respect of the notes because an Event of Default specified in clause (7)
above shall have occurred and be continuing, such declaration of acceleration of
the notes and such Event of Default and all consequences thereof (including
without limitation any acceleration or resulting payment default) shall be
annulled, waived and rescinded, automatically and without any action by the
trustee or the holders, and be of no further effect, if within 60 days after
such Event of Default arose
(x) the Indebtedness that is the basis for such Event of Default has
been discharged, or
(y) the holders thereof have rescinded or waived the acceleration,
notice or action (as the case may be) giving rise to such Event of Default,
or
(z) the default in respect of such Indebtedness that is the basis for
such Event of Default has been cured.
Subject to the provisions of the indenture relating to the duties of the
trustee, in case an Event of Default occurs and is continuing, the trustee will
be under no obligation to exercise any of the rights or powers under the
indenture at the request or direction of any of the holders unless such holders
have offered to the trustee reasonable indemnity or security against any loss,
liability or expense. Except to enforce the right to receive payment of
principal or interest when due, no holder may pursue any remedy with respect to
the indenture or the notes unless
(a) such holder has previously given the trustee written notice that an
Event of Default is continuing,
(b) holders of at least 25% in principal amount of the outstanding notes
have requested the trustee in writing to pursue the remedy,
(c) such holders have offered the trustee reasonable security or
indemnity against any loss, liability or expense,
(d) the trustee has not complied with such request within 60 days after
the receipt of the request and the offer of security or indemnity and
(e) the holders of a majority in principal amount of the outstanding
notes have not given the trustee a direction inconsistent with such request
within such 60-day period.
Subject to certain restrictions, the holders of a majority in principal amount
of the outstanding notes are given the right to direct the time, method and
place of conducting any proceeding for any remedy available to the trustee or of
exercising any trust or power conferred on the trustee. The trustee, however,
may refuse to follow any direction that conflicts with law or the indenture or
that the trustee determines is unduly prejudicial to the rights of any other
holder or that would involve the trustee in personal liability. Prior to taking
any action under the indenture, the trustee will be entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses caused
by taking or not taking such action.
The indenture provides that if a Default occurs and is continuing and is
known to the trustee, the trustee must mail to each holder notice of the Default
within 90 days after it occurs. Except in the case of a Default in the payment
of principal of, or premium (if any) or interest on, any note, the trustee may
withhold notice if and so long as a committee of its Trust Officers in good
faith determines that withholding notice is in the interests of the noteholders.
In addition, North American Van Lines is required to deliver to the trustee,
within 120 days after the end of each fiscal year, a certificate indicating
whether the signers thereof know of any Default that occurred during the
previous year. North American Van Lines also is required to deliver to the
trustee, within 30 days after the occurrence thereof, written notice of any
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event that would constitute certain Defaults, their status and what action North
American Van Lines is taking or proposes to take in respect thereof.
AMENDMENTS AND WAIVERS
Subject to certain exceptions, the indenture may be amended with the consent
of the holders of a majority in principal amount of the notes then outstanding
and any past default or compliance with any provisions may be waived with the
consent of the holders of a majority in principal amount of the notes then
outstanding (including in each case, consents obtained in connection with a
tender offer or exchange offer for notes). However, without the consent of each
holder of an outstanding note affected, no amendment or waiver may
(1) reduce the principal amount of notes whose holders must consent to
an amendment or waiver,
(2) reduce the rate of or extend the time for payment of interest on any
note,
(3) reduce the principal of or extend the Stated Maturity of any note,
(4) reduce the premium payable upon the redemption of any note or change
the date on which any note may be redeemed as described under "Optional
Redemption" above,
(5) make any note payable in money other than that stated in the note,
(6) make any change to the subordination provisions of the indenture
that adversely affects the rights of any holder in any material respect,
(7) impair the right of any holder to receive payment of principal of
and interest on such holder's notes on or after the due dates therefor or to
institute suit for the enforcement of any payment on or with respect to such
holder's notes or
(8) make any change in the amendment or waiver provisions described in
this sentence.
Without the consent of any holder, North American Van Lines, the trustee and
(as applicable) any Note Guarantor may amend the indenture to cure any
ambiguity, omission, defect or inconsistency, to provide for the assumption by a
successor of the obligations of North American Van Lines under the indenture, to
provide for uncertificated notes in addition to or in place of certificated
notes, to add Guarantees with respect to the notes, to secure the notes, to
confirm and evidence the release, termination or discharge of any Guarantee or
Lien with respect to or securing the notes when such release, termination or
discharge is provided for under the indenture, to add to the covenants of North
American Van Lines for the benefit of the noteholders or to surrender any right
or power conferred upon North American Van Lines, to provide that any
Indebtedness that becomes or will become an obligation of the Successor Company
or a Note Guarantor pursuant to a transaction governed by the provisions
described under "--Merger and Consolidation" (and that is not a Subordinated
Obligation) is Senior Subordinated Indebtedness or Guarantor Senior Subordinated
Indebtedness for purposes of the indenture, to provide for or confirm the
issuance of Additional Notes, to make any change that does not adversely affect
the rights of any holder, or to comply with any requirement of the SEC in
connection with the qualification of the indenture under the TIA or otherwise.
However, no amendment may be made to the subordination provisions of the
indenture that adversely affects the rights of any holder of Senior Indebtedness
then outstanding (which Senior Indebtedness has been previously designated in
writing by North American Van Lines to the trustee for this purpose) unless the
holders of such Senior Indebtedness (or any group or representative thereof
authorized to give a consent) consent to such change.
The consent of the noteholders is not necessary under the indenture to
approve the particular form of any proposed amendment or waiver. It is
sufficient if such consent approves the substance of the proposed
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amendment or waiver. Until an amendment or waiver becomes effective, a consent
to it by a noteholder is a continuing consent by such noteholder and every
subsequent holder of all or part of the related note. Any such noteholder or
subsequent holder may revoke such consent as to its note by written notice to
the trustee or North American Van Lines, received thereby before the date on
which North American Van Lines certifies to the trustee that the holders of the
requisite principal amount of notes have consented to such amendment or waiver.
After an amendment or waiver under the indenture becomes effective, North
American Van Lines is required to mail to noteholders a notice briefly
describing such amendment or waiver. However, the failure to give such notice to
all noteholders, or any defect therein, will not impair or affect the validity
of the amendment or waiver.
DEFEASANCE
North American Van Lines at any time may terminate all its obligations under
the notes and the indenture ("legal defeasance"), except for certain
obligations, including those relating to the defeasance trust and obligations to
register the transfer or exchange of the notes, to replace mutilated, destroyed,
lost or stolen notes and to maintain a registrar and paying agent in respect of
the notes. North American Van Lines at any time may terminate its obligations
under certain covenants under the indenture, including the covenants described
under "--Certain Covenants" and "--Change of Control," the operation of the
default provisions relating to such covenants described under "--Defaults"
above, the operation of the cross acceleration provision, the bankruptcy
provisions with respect to Subsidiaries and the judgment default provision
described under "--Defaults" above, and the limitations contained in clauses
(3), (4) and (5) under "--Merger and Consolidation" above ("covenant
defeasance"). If North American Van Lines exercises its legal defeasance option
or its covenant defeasance option, each Note Guarantor will be released from all
of its obligations with respect to its Note Guarantee.
North American Van Lines may exercise its legal defeasance option
notwithstanding its prior exercise of its covenant defeasance option. If North
American Van Lines exercises its legal defeasance option, payment of the notes
may not be accelerated because of an Event of Default with respect thereto. If
North American Van Lines exercises its covenant defeasance option, payment of
the notes may not be accelerated because of an Event of Default specified in
clause (4), (5) (as it relates to the covenants described under "--Certain
Covenants" above), (6), (7), (8) (but only with respect to events of bankruptcy,
insolvency or reorganization of a Significant Subsidiary), (9) or (10) under
"Defaults" above or because of the failure of North American Van Lines to comply
with clause (3), (4) or (5) under "--Merger and Consolidation" above.
Either defeasance option may be exercised to any redemption date or to the
maturity date for the notes. In order to exercise either defeasance option,
North American Van Lines must irrevocably deposit in trust (the "defeasance
trust") with the trustee money or U.S. Government Obligations, or a combination
thereof, for the payment of principal of, and premium (if any) and interest on,
the notes to redemption or maturity, as the case may be, and must comply with
certain other conditions, including delivery to the trustee of an Opinion of
Counsel to the effect that holders of the notes will not recognize income, gain
or loss for Federal income tax purposes as a result of such deposit and
defeasance and will be subject to Federal income tax on the same amount and in
the same manner and at the same times as would have been the case if such
deposit and defeasance had not occurred (and, in the case of legal defeasance
only, such Opinion of Counsel must be based on a ruling of the Internal Revenue
Service or other change in applicable Federal income tax law since the Issue
Date).
SATISFACTION AND DISCHARGE
The indenture will be discharged and cease to be of further effect (except
as to surviving rights of registration of transfer or exchange of the notes, as
expressly provided for in the indenture) as to all outstanding notes when
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(1) either
(a) all the notes previously authenticated and delivered (other than
certain lost, stolen or destroyed notes, and certain notes for which
provision for payment was previously made and thereafter the funds have
been released to North American Van Lines) have been delivered to the
trustee for cancellation or
(b) all notes previously delivered to the trustee for cancellation
(X) have become due and payable, (Y) will become due and payable at their
Stated Maturity within one year or (Z) are to be called for redemption
within one year under arrangements reasonably satisfactory to the trustee
for the giving of notice of redemption by the trustee in the name, and at
the expense, of North American Van Lines;
(2) North American Van Lines has irrevocably deposited or caused to be
deposited with the trustee money, U.S. Government Obligations, or a
combination thereof, sufficient to pay and discharge the entire indebtedness
on the notes not previously delivered to the trustee for cancellation, for
principal, premium, if any, and interest to the date of deposit (in the case
of notes that have become due and payable) or to the Stated Maturity or
redemption date, as the case may be;
(3) North American Van Lines has paid or caused to be paid all other
sums payable under the indenture by North American Van Lines; and
(4) North American Van Lines has delivered to the trustee an Officer's
Certificate and an Opinion of Counsel each to the effect that all conditions
precedent under the "Satisfaction and Discharge" section of the indenture
relating to the satisfaction and discharge of the indenture have been
complied with, provided that any such counsel may rely on any Officer's
Certificate as to matters of fact (including as to compliance with the
foregoing clauses (1), (2) and (3)).
NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES, INCORPORATORS AND
STOCKHOLDERS
No director, officer, employee, incorporator, member or stockholder, as
such, of North American Van Lines, Holding, any Note Guarantor or any Subsidiary
of any thereof shall have any liability for any obligation of North American Van
Lines, Holding or any Note Guarantor under the indenture, the notes or any Note
Guarantee, or for any claim based on, in respect of, or by reason of, any such
obligation or its creation. Each noteholder, by accepting the notes, waives and
releases all such liability. The waiver and release are part of the
consideration for issuance of the notes.
CONCERNING THE TRUSTEE
State Street Bank and Trust Company is the trustee under the indenture and
has been appointed by North American Van Lines as Registrar and Paying Agent
with regard to the notes.
The indenture will provide that, except during the continuance of an Event
of Default, the trustee will perform only such duties as are set forth
specifically in the indenture. During the existence of an Event of Default, the
trustee will exercise such of the rights and powers vested in it under the
indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise under the circumstances in the conduct of such
person's own affairs.
The indenture and the TIA will impose certain limitations on the rights of
the trustee, should it become a creditor of North American Van Lines, to obtain
payment of claims in certain cases or to realize on certain property received by
it in respect of any such claims, as security or otherwise. The trustee is
permitted to engage in other transactions; provided, that if it acquires any
conflicting interest as described in the TIA, it must eliminate such conflict,
apply to the SEC for permission to continue as trustee with such conflict, or
resign.
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GOVERNING LAW
The indenture provides that it and the notes will be governed by, and
construed in accordance with, the laws of the State of New York, without giving
effect to any principles of conflict of laws to the extent that the application
of the law of another jurisdiction would be required thereby.
BOOK-ENTRY, DELIVERY AND FORM
The notes will be represented by one or more notes in registered, global
form deposited with the trustee as custodian for the Depository Trust Company
("DTC") and registered in the name of Cede & Co. as nominee of DTC, in each case
for credit to the accounts of DTC participants and indirect participants (each
as described below) including, without limitation, Morgan Guaranty Trust Company
of New York, Brussels office, as operator (the "Euroclear Operator") of the
Euroclear System and Cedelbank.
Except in the limited circumstances set forth below, notes in certificated
form will not be issued.
DEPOSITARY PROCEDURES
DTC has advised North American Van Lines as follows: DTC is a limited
purpose trust company organized under the laws of the State of New York, a
"banking organization" within the meaning of New York Banking Law, a member of
the Federal Reserve System, a "clearing corporation" within the meaning of the
Uniform Commercial Code and a "Clearing Agency" registered pursuant to the
provisions of Section 17A of the Exchange Act. DTC was created to hold
securities for persons who have accounts with it ("DTC participants") and to
facilitate the clearance and settlement of securities transactions between DTC
participants through electronic book-entry changes in accounts of its
participants, thereby eliminating the need for physical movement of
certificates. DTC participants include securities brokers and dealers, banks,
trust companies and clearing corporations and may include certain other
organizations. Indirect access to the DTC system is available to others such as
banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a DTC participant, either directly or indirectly
("indirect participants").
DTC has advised North American Van Lines that pursuant to procedures
established by it,
(1) upon initial deposit of a global note, DTC will credit the accounts
of DTC participants with portions of the principal amount of such global
note deposited,
(2) for DTC participants, initial ownership of interests in such global
note will be shown on, and the transfer of ownership thereof will be
effected through, records maintained by DTC and
(3) for non-DTC participant owners, ownership interests in such global
note will only be shown on, and the transfer of ownership thereof will only
be effected through, the records of the DTC participants, including
Euroclear and Cedelbank, or others through which they hold their account.
All interests in a global note deposited with DTC, including those held through
Euroclear and Cedelbank, are subject to the procedures and requirements of DTC.
Those interests held through Euroclear are also subject to the procedures and
requirements of such system.
Except as described below, owners of interests in any global note will not
have notes registered in their names, will not receive physical delivery of
notes in certificated form and will not be considered the registered owners or
holders of notes for any purpose. So long as DTC (or its nominee) is the
registered owner or holder of a global note, such party will be considered the
sole owner or holder of the notes represented by such global note for all
purposes under the indenture and the notes. Accordingly, each person owning a
beneficial interest in a global note must rely on the procedures of DTC and its
participants to exercise any rights and remedies of a holder of notes under the
indenture. Payments of
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principal and interest on any global note will be made to DTC or its nominee as
the registered owners thereof.
The laws of some countries and some states in the United States require that
certain persons take physical delivery in definitive form of securities that
they own. Consequently, the ability to transfer beneficial interests in a global
note to such persons may be limited to that extent. Because DTC can act only on
behalf of its participants, the ability of a person having beneficial interests
in a global note to pledge such interests to persons or entities that do not
participate in the relevant clearing system, or otherwise take actions in
respect of such interests, may be affected by the lack of a physical certificate
evidencing such interests.
PAYMENTS ON THE GLOBAL NOTES
Payments in respect of the principal of, and premium, if any, and interest
on a global note will be made through a payment agent appointed pursuant to the
indenture and will be payable to DTC (or its nominee) in its capacity as the
registered holder of such notes under the indenture. Under the terms of the
indenture, the Issuer and the trustee will treat the persons in whose names the
notes, including the global notes, are registered as the owners thereof for the
purpose of receiving such payments and for any and all other purposes
whatsoever. Consequently, none of North American Van Lines, the trustee, or any
agent of North American Van Lines or the trustee has or will have any
responsibility or liability for (1) any aspect or accuracy of the records of the
relevant clearing system, the participants therein or the account holders
thereof, as the case may be, relating to payments made on account of beneficial
ownership interests in the global notes, or for maintaining, supervising or
reviewing any records of such clearing system, participant or account holder
relating to beneficial ownership interests in the global notes, or (2) any other
matter relating to the actions and practices of the relevant clearing system or
the participants therein or the account holders thereof.
North American Van Lines understands that DTC, upon receipt of any such
payment, will immediately credit the accounts of its relevant participants with
payments in amounts proportionate to their respective holdings in principal
amount of beneficial interests in the relevant global note, as shown on the
records of DTC. North American Van Lines expects that payments by such
participants to the beneficial owners of global notes will be governed by
standing instructions and customary practices and will be the responsibility of
such participants. Neither North American Van Lines nor the trustee will have
responsibility or liability for the payment of amounts owing in respect of
beneficial interests in the global notes held by DTC.
TRANSFERS OF GLOBAL SECURITIES AND INTERESTS THEREIN
Unless definitive securities are issued, a global note may be transferred,
in whole and not in part, only to another nominee of DTC or to a successor of
DTC or its nominee.
Transfers of beneficial interests in the global notes will be subject to the
applicable rules and procedures of DTC and its direct and indirect participants
(including, if applicable, those of Euroclear and Cedelbank), which are subject
to change from time to time. Any secondary market trading activity in beneficial
interests in the global notes is expected to occur through the participants of
DTC, and the securities custody accounts of investors are expected to be
credited with their holdings against payment in same-day funds on the settlement
date.
No service charge will be made for any registration of transfer or exchange
of notes, but the trustee or North American Van Lines may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
Although DTC has agreed to certain procedures to facilitate transfers of
interests in the global notes among participants in DTC, it is under no
obligation to perform or to continue to perform such
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procedures, and such procedures may be discontinued at any time. None of North
American Van Lines, the trustee, nor any agent of North American Van Lines or
the trustee will have any responsibility for the nonperformance or
misperformance (as a result of insolvency, mistake, misconduct or otherwise) by
DTC, or its participants or indirect participants, of their respective
obligations under the rules and procedures governing their operations.
North American Van Lines understands that under existing industry practices,
if either North American Van Lines or the trustee requests any action of holders
of notes, or if an owner of a beneficial interest in a global note desires to
give instructions or take an action that a holder is entitled to give or take
under the indenture, DTC would authorize its participants owning the relevant
beneficial interest to give such instructions or take such action, and such
participants would authorize indirect participants to give such instructions or
take such action, or would otherwise act upon the instructions of such indirect
participants.
North American Van Lines understands that under existing practices of DTC,
if less than all of the respective class of notes are to be redeemed at any
time, DTC will credit its participants' accounts on a proportionate basis (with
adjustments to prevent fractions) or by lot or on such other basis as DTC deems
fair and appropriate, provided that no beneficial interests of less than $1,000
may be redeemed in part.
CERTIFICATED NOTES
Beneficial interests in a global note are exchangeable for definitive notes
in registered certificated form only if
(1) DTC (a) notifies North American Van Lines that it is unwilling or
unable to continue as depositary for such global note or (b) has ceased to
be a "clearing agency" registered under the Exchange Act and, in each case,
North American Van Lines thereupon is unable to locate a qualified successor
depositary within 90 days;
(2) North American Van Lines, at its option, notifies the trustee in
writing that it elects to cause the issuance of notes in definitive form
under the indenture; or
(3) upon the occurrence of certain other events.
In all cases, certificated notes delivered in exchange for any global note or
beneficial interest therein will be registered in the names, and issued in any
approved denominations, requested by or on behalf of DTC in accordance with its
customary procedures. The notes may not be issued in bearer form.
In the case of the issuance of certificated notes in the limited
circumstances set forth above, the holder of any such certificated note may
transfer such note by surrendering it at the offices or agencies of North
American Van Lines maintained for such purpose within the City and State of New
York. Until otherwise designated by North American Van Lines, North American Van
Lines' office or agency in the City and State of New York will be the office of
an affiliate of the trustee maintained for such purpose. In the event of a
partial transfer of a holding of notes represented by one certificate, or
partial redemption of such a holding represented by one certificate, a new
certificate shall be issued to the transferee in respect of the part transferred
or redeemed and a further new certificate in respect of the balance of the
holding not transferred or redeemed shall be issued to the transferor, provided
that no certificate in denominations less than $1,000 shall be issued.
North American Van Lines shall not be required to register the transfer or
exchange of certificated notes for a period of 15 days preceding (a) the due
date for any payment of principal of or interest on the notes or (b) a selection
of notes to be redeemed. Also, North American Van Lines is not required to
register the transfer or exchange of any notes selected for redemption. In the
event of the transfer of any certificated note, the trustee may require a
holder, among other things, to furnish appropriate
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endorsements and transfer documents, and North American Van Lines may require a
holder to pay any taxes and fees required by law and permitted by the indenture
and the notes.
If certificated notes are issued and a holder of a certificated note claims
that the note has been lost, destroyed or wrongfully taken or if such note is
mutilated and is surrendered to the trustee, North American Van Lines shall
issue and the trustee shall authenticate a replacement note if the trustee's and
North American Van Lines' requirements are met. If required by the trustee or
North American Van Lines, an indemnity bond sufficient in the judgment of both
to protect North American Van Lines, the trustee and any paying agent or
authenticating agent appointed pursuant to the indenture from any loss which any
of them may suffer if a note is replaced must be posted. North American Van
Lines may charge for its expenses in replacing a note.
In case any such mutilated, destroyed, lost or stolen note has become or is
about to become due and payable, or is about to be redeemed or purchased by
North American Van Lines pursuant to the provisions of the indenture, North
American Van Lines in its discretion may, instead of issuing a new note, pay,
redeem or purchase such note, as the case may be.
REGISTRATION RIGHTS
The following summary of certain provisions of the registration rights
agreement does not contain all of the information that may be important to an
investor in the notes. It is subject to, and is qualified in its entirety by
reference to, all the provisions of the registration rights agreement. A copy of
the registration rights agreement is available as set forth under the heading
"Where You Can Find More Information."
Pursuant to the registration rights agreement, North American Van Lines has
agreed to use its reasonable best efforts to file a registration statement for
this exchange offer and to use all commercially reasonable efforts to cause it
to become effective. The registration statement of which this prospectus is a
part constitutes the registration statement to be filed pursuant to the
registration rights agreement.
If, as a result of a change in law or interpretations of the staff of the
SEC North American Van Lines is not permitted to effect the exchange offer, or
if any holder of the notes (other than the initial purchasers, an affiliate of
North American Van Lines or a noteholder that cannot make required
representations) is not permitted by applicable law to participate in, or to
receive the benefit of, the exchange offer, North American Van Lines will use
its reasonable best efforts to file a shelf registration statement with respect
to resales of old notes or new notes, as the case may be, and to cause the shelf
registration statement to be declared effective under the Securities Act within
270 days after the Issue Date. After such shelf registration statement is
declared effective, North American Van Lines will use its reasonable best
efforts to keep the shelf registration statement in effect until the earlier of
two years from the Issue Date (or one year in the case of a shelf registration
effected at the request of the initial purchasers) or such shorter period that
will terminate when all the old notes or new notes covered by the shelf
registration statement (1) have been sold pursuant thereto or (2) are
distributed to the public pursuant to Rule 144 or become eligible for resale
pursuant to Rule 144 without volume restriction, if any. Under certain
circumstances, North American Van Lines may suspend the availability of the
shelf registration statement for certain periods of time.
North American Van Lines will, in the event a shelf registration statement
is filed, among other things, provide to each holder for whom such shelf
registration statement was filed copies of the prospectus that is a part of the
shelf registration statement, notify each such holder when the shelf
registration statement has become effective and take certain other actions as
are required to permit unrestricted resales of the old notes or the new notes,
as the case may be. A holder of notes selling such notes pursuant to the shelf
registration statement generally would be required to be named as a selling
security holder in the related prospectus and to deliver a prospectus to
purchasers, will be subject to certain of the civil liability provisions under
the Securities Act in connection with such sales and will be bound by certain
provisions of the registration rights agreement (including certain
indemnification obligations). In addition, each such
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holder of notes will be required, among other things, to deliver information to
be used in connection with the shelf registration statement within the time
periods set forth in the registration rights agreement in order to benefit from
the provisions regarding additional interest set forth in the following
paragraph.
If the exchange offer is not consummated on or before the 240th day after
the original issue date of the old notes or, if a shelf registration statement
is required to be filed, such shelf registration statement is not declared
effective by the SEC with respect to the old notes on or before the 270th day
after the original issue date of the old notes, the interest rate borne for such
old notes will be increased by 0.25% per annum. This additional interest will
increase by 0.25% per annum every twelve weeks thereafter, but will not exceed
0.50% per annum in the aggregate in any event. This additional interest will
accrue until the exchange offer is consummated or the shelf registration
statement is declared effective.
CERTAIN DEFINITIONS
"Acquired Debt" means Indebtedness of any Person that is assumed by North
American Van Lines or any Restricted Subsidiary in connection with its
acquisition of assets from such Person or any Affiliate thereof or is issued and
outstanding on or prior to the date on which such Person was acquired by North
American Van Lines or any Restricted Subsidiary or merged or consolidated with
or into North American Van Lines or any Restricted Subsidiary (other than
Indebtedness Incurred to finance, or otherwise in connection with or in
contemplation of, such acquisition).
"Additional Assets" means
(1) any property or assets that replace the property or assets that are
the subject of an Asset Disposition;
(2) any property or assets (other than Indebtedness and Capital Stock)
to be used by North American Van Lines or a Restricted Subsidiary in a
Related Business;
(3) the Capital Stock of a Person that is engaged in a Related Business
and becomes a Restricted Subsidiary as a result of the acquisition of such
Capital Stock by North American Van Lines or another Restricted Subsidiary;
or
(4) Capital Stock of any Person that at such time is a Restricted
Subsidiary, acquired from a third party.
"Affiliate" of any specified Person means any other Person, directly or
indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any moving or storage company or contractor, or other Person,
that provides sales, packing, warehousing, hauling or other services in
connection with the ordinary course of business or operations of North American
Van Lines or any of its Subsidiaries, or any Affiliate of any such Agent.
"Agent Guarantee" means any Guarantee by North American Van Lines or any
Restricted Subsidiary of Indebtedness or other obligations of any Agent, entered
into in accordance with the indenture.
"all or substantially all" has the meaning given to such phrase in the
Revised Model Business Corporation Act and commentary thereto.
"Allied Acquisition" means the acquisition of Capital Stock and/or assets of
certain Subsidiaries of NFC plc engaged in moving services businesses pursuant
to the Acquisition Agreement dated as of September 14, 1999 between Holding and
NFC plc, and the other transactions contemplated thereby.
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"Asset Disposition" means any sale, lease, transfer or other disposition of
shares of Capital Stock of a Restricted Subsidiary (other than directors'
qualifying shares, or (in the case of a Foreign Subsidiary) to the extent
required by applicable law), property or other assets (each referred to for the
purposes of this definition as a "disposition") by North American Van Lines or
any of its Restricted Subsidiaries (including any disposition by means of a
merger, consolidation or similar transaction), other than
(1) a disposition to North American Van Lines or a Restricted
Subsidiary,
(2) a disposition in the ordinary course of business,
(3) the sale or discount (with or without recourse, and on customary or
commercially reasonable terms) of accounts receivable or notes receivable
arising in the ordinary course of business, or the conversion or exchange of
accounts receivable for notes receivable,
(4) any Restricted Payment Transaction,
(5) a disposition that is governed by the provisions described under
"--Merger and Consolidation,"
(6) any Financing Disposition,
(7) any "fee in lieu" or other disposition of assets to any governmental
authority or agency that continue in use by North American Van Lines or any
Restricted Subsidiary, so long as North American Van Lines or any Restricted
Subsidiary may obtain title to such assets upon reasonable notice by paying
a nominal fee,
(8) any exchange of like property pursuant to Section 1031 (or any
successor section) of the Code,
(9) any financing transaction with respect to property built or acquired
by North American Van Lines or any Restricted Subsidiary after the Issue
Date, including without limitation any sale/ leaseback transaction or asset
securitization,
(10) any disposition arising from foreclosure, condemnation or similar
action with respect to any property or other assets,
(11) any disposition of Capital Stock, Indebtedness or other securities
of an Unrestricted Subsidiary,
(12) a disposition of Capital Stock of a Restricted Subsidiary pursuant
to an agreement or other obligation with or to a Person (other than North
American Van Lines or a Restricted Subsidiary) from whom such Restricted
Subsidiary was acquired, or from whom such Restricted Subsidiary acquired
its business and assets (having been newly formed in connection with such
acquisition), entered into in connection with such acquisition,
(13) a disposition of not more than 5% of the outstanding Capital Stock
of a Foreign Subsidiary to one or more members of the management of such
Foreign Subsidiary that has been approved by the Board of Directors, or
(14) any disposition or series of related dispositions for aggregate
consideration not to exceed $2.5 million.
"Average Life" means, as of the date of determination, with respect to any
Indebtedness or Preferred Stock, the quotient obtained by dividing
(1) the sum of the products of the numbers of years from the date of
determination to the dates of each successive scheduled principal payment of
such Indebtedness or redemption or similar payment with respect to such
Preferred Stock multiplied by the amount of such payment by
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(2) the sum of all such payments.
"Bank Indebtedness" means any and all amounts, whether outstanding on the
Issue Date or thereafter incurred, payable under or in respect of the Senior
Credit Facility, including without limitation principal, premium (if any),
interest (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to North American Van Lines or any
Restricted Subsidiary whether or not a claim for post-filing interest is allowed
in such proceedings), fees, charges, expenses, reimbursement obligations,
guarantees, other monetary obligations of any nature and all other amounts
payable thereunder or in respect thereof.
"Board of Directors" means the board of directors or other governing body of
North American Van Lines or, if North American Van Lines is owned or managed by
a single entity, the board of directors or other governing body of such entity,
or, in either case, any committee thereof duly authorized to act on behalf of
such board or governing body.
"Borrowing Base" means 85% of accounts receivables of North American Van
Lines and its Restricted Subsidiaries (determined in accordance with GAAP as of
the end of the most recently ended fiscal quarter for which consolidated
financial statements of North American Van Lines are available).
"Business Day" means a day other than a Saturday, Sunday or other day on
which commercial banking institutions are authorized or required by law to close
in New York City.
"Capital Stock" of any Person means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interests
in (however designated) equity of such Person, including any Preferred Stock,
but excluding any debt securities convertible into such equity.
"Capitalized Lease Obligation" means an obligation that is required to be
classified and accounted for as a capitalized lease for financial reporting
purposes in accordance with GAAP. The Stated Maturity of any Capitalized Lease
Obligation shall be the date of the last payment of rent or any other amount due
under the related lease.
"Cash Equivalents" means any of the following:
(a) securities issued or fully guaranteed or insured by the United
States Government or any agency or instrumentality thereof,
(b) time deposits, certificates of deposit or bankers' acceptances of
(1) any lender under the Senior Credit Agreement or (2) any commercial bank
having capital and surplus in excess of $500,000,000 and the commercial
paper of the holding company of which is rated at least A-1 or the
equivalent thereof by S&P or at least P-1 or the equivalent thereof by
Moody's (or if at such time neither is issuing ratings, then a comparable
rating of another nationally recognized rating agency),
(c) commercial paper rated at least A-l or the equivalent thereof by S&P
or at least P-1 or the equivalent thereof by Moody's (or if at such time
neither is issuing ratings, then a comparable rating of another nationally
recognized rating agency) and
(d) investments in money market funds complying with the risk limiting
conditions of Rule 2a-7 or any successor rule of the SEC under the
Investment Company Act of 1940, as amended.
"CDR" means Clayton, Dubilier & Rice, Inc.
"CDR Fund V" means Clayton, Dubilier & Rice Fund V Limited Partnership, a
Cayman Islands exempted limited partnership, and any successor in interest
thereto.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means North American Van Lines, Inc., a Delaware corporation, and
any successor in interest thereto.
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"Consolidated Coverage Ratio" as of any date of determination means the
ratio of (x) the aggregate amount of Consolidated EBITDA of North American Van
Lines and its Restricted Subsidiaries for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such determination for
which consolidated financial statements of North American Van Lines are
available to (y) Consolidated Interest Expense for such four fiscal quarters (in
each case, determined, for each fiscal quarter (or portion thereof) of the four
fiscal quarters ending prior to the Issue Date, on a pro forma basis to give
effect to the Allied Acquisition as if it had occurred at the beginning of such
four-quarter period); provided, that
(1) if since the beginning of such period North American Van Lines or
any Restricted Subsidiary has Incurred any Indebtedness that remains
outstanding on such date of determination or if the transaction giving rise
to the need to calculate the Consolidated Coverage Ratio is an Incurrence of
Indebtedness, Consolidated EBITDA and Consolidated Interest Expense for such
period shall be calculated after giving effect on a pro forma basis to such
Indebtedness as if such Indebtedness had been Incurred on the first day of
such period (except that in making such computation, the amount of
Indebtedness under any revolving credit facility outstanding on the date of
such calculation shall be computed based on (A) the average daily balance of
such Indebtedness during such four fiscal quarters or such shorter period
for which such facility was outstanding or (B) if such facility was created
after the end of such four fiscal quarters, the average daily balance of
such Indebtedness during the period from the date of creation of such
facility to the date of such calculation),
(2) if since the beginning of such period North American Van Lines or
any Restricted Subsidiary has repaid, repurchased, redeemed, defeased or
otherwise acquired, retired or discharged any Indebtedness (each, a
"Discharge") or if the transaction giving rise to the need to calculate the
Consolidated Coverage Ratio involves a Discharge of Indebtedness (in each
case other than Indebtedness Incurred under any revolving credit facility
unless such Indebtedness has been permanently repaid), Consolidated EBITDA
and Consolidated Interest Expense for such period shall be calculated after
giving effect on a pro forma basis to such Discharge of such Indebtedness,
including with the proceeds of such new Indebtedness, as if such Discharge
had occurred on the first day of such period,
(3) if since the beginning of such period North American Van Lines or
any Restricted Subsidiary shall have disposed of any company, any business
or any group of assets constituting an operating unit of a business (any
such disposition, a "Sale"), the Consolidated EBITDA for such period shall
be reduced by an amount equal to the Consolidated EBITDA (if positive)
attributable to the assets that are the subject of such Sale for such period
or increased by an amount equal to the Consolidated EBITDA (if negative)
attributable thereto for such period and Consolidated Interest Expense for
such period shall be reduced by an amount equal to
(A) the Consolidated Interest Expense attributable to any Indebtedness of
North American Van Lines or any Restricted Subsidiary repaid,
repurchased, redeemed, defeased or otherwise acquired, retired or
discharged with respect to North American Van Lines and its
continuing Restricted Subsidiaries in connection with such Sale for
such period (including but not limited to through the assumption of
such Indebtedness by another Person)
plus
(B) if the Capital Stock of any Restricted Subsidiary is sold, the
Consolidated Interest Expense for such period attributable to the
Indebtedness of such Restricted Subsidiary to the extent North
American Van Lines and its continuing Restricted Subsidiaries are no
longer liable for such Indebtedness after such Sale,
(4) if since the beginning of such period North American Van Lines or
any Restricted Subsidiary (by merger, consolidation or otherwise) shall have
made an Investment in any Person that thereby becomes a Restricted
Subsidiary, or otherwise acquired any company, any business or any group of
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assets constituting an operating unit of a business, including any such
Investment or acquisition occurring in connection with a transaction causing
a calculation to be made hereunder (any such Investment or acquisition, a
"Purchase"), Consolidated EBITDA and Consolidated Interest Expense for such
period shall be calculated after giving pro forma effect thereto (including
the Incurrence of any related Indebtedness) as if such Purchase occurred on
the first day of such period, and
(5) if since the beginning of such period any Person became a Restricted
Subsidiary or was merged or consolidated with or into North American Van
Lines or any Restricted Subsidiary, and since the beginning of such period
such Person shall have Discharged any Indebtedness or made any Sale or
Purchase that would have required an adjustment pursuant to clause (2),
(3) or (4) above if made by North American Van Lines or a Restricted
Subsidiary during such period, Consolidated EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving pro forma effect
thereto as if such Discharge, Sale or Purchase occurred on the first day of
such period.
For purposes of this definition, whenever pro forma effect is to be given to
any Sale, Purchase or other transaction, or the amount of income or earnings
relating thereto and the amount of Consolidated Interest Expense associated with
any Indebtedness Incurred or repaid, repurchased, redeemed, defeased or
otherwise acquired, retired or discharged in connection therewith, the pro forma
calculations in respect thereof may include anticipated cost savings relating to
any such Sale, Purchase or other transaction that North American Van Lines
reasonably believes in good faith could have been achieved during the relevant
four quarter period as a result of such Sale, Purchase or other transaction
(PROVIDED that both (1) such cost savings were identified and quantified in an
Officer's Certificate delivered to the trustee at the time of the consummation
of such transaction and (2) with respect to each such transaction completed
prior to the 90(th) day preceding the relevant date of determination, actions
were commenced or initiated by North American Van Lines within 90 days of the
consummation of such transaction to effect such cost savings identified in such
Officer's Certificate and with respect to any other transaction, such Officer's
Certificate sets forth the specific steps to be taken within the 90 days after
the consummation of such transaction to accomplish such cost savings). If any
Indebtedness bears a floating rate of interest and is being given pro forma
effect, the interest expense on such Indebtedness shall be calculated as if the
rate in effect on the date of determination had been the applicable rate for the
entire period (taking into account any Interest Rate Agreement applicable to
such Indebtedness). If any Indebtedness bears, at the option of North American
Van Lines or a Restricted Subsidiary, a rate of interest based on a prime or
similar rate, a eurocurrency interbank offered rate or other fixed or floating
rate, and such Indebtedness is being given pro forma effect, the interest
expense on such Indebtedness shall be calculated by applying such optional rate
as North American Van Lines or such Restricted Subsidiary may designate. If any
Indebtedness that is being given pro forma effect was Incurred under a revolving
credit facility, the interest expense on such Indebtedness shall be computed
based upon the average daily balance of such Indebtedness during the applicable
period. Interest on a Capitalized Lease Obligation shall be deemed to accrue at
an interest rate determined in good faith by a responsible financial or
accounting officer of North American Van Lines to be the rate of interest
implicit in such Capitalized Lease Obligation in accordance with GAAP.
"Consolidated EBITDA" means, for any period, the Consolidated Net Income for
such period, plus the following to the extent deducted in calculating such
Consolidated Net Income:
(1) provision for all taxes (whether or not paid, estimated or accrued)
based on income, profits or capital,
(2) Consolidated Interest Expense,
(3) depreciation, amortization (including but not limited to
amortization of goodwill and intangibles and amortization and write-off of
financing costs) and all other non-cash charges or non-cash losses,
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(4) any expenses or charges related to any Equity Offering, Investment
or Indebtedness permitted by the indenture (whether or not consummated or
incurred) and
(5) the amount of any minority interest expense.
To the extent Consolidated EBITDA would otherwise include the amount of any
Receivables Fees excluded from Consolidated Interest Expense pursuant to
clause (3) of the definition of Consolidated Interest Expense, Consolidated
EBITDA shall be reduced by such amount.
"Consolidated Interest Expense" means, for any period,
(1) the total interest expense of North American Van Lines and its
Restricted Subsidiaries to the extent deducted in calculating Consolidated
Net Income, net of any interest income of North American Van Lines and its
Restricted Subsidiaries, including without limitation any such interest
expense consisting of
(a) interest expense attributable to Capitalized Lease Obligations,
(b) amortization of debt discount,
(c) interest in respect of Indebtedness of any other Person that has
been Guaranteed by North American Van Lines or any Restricted
Subsidiary of North American Van Lines (other than Indebtedness
Guaranteed under any Management Guarantee or Agent Guarantee,
except to the extent the interest thereon is actually being paid
by North American Van Lines or a Restricted Subsidiary thereof),
(d) non-cash interest expense,
(e) the interest portion of any deferred payment obligation, and
(f) commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing,
plus
(2) dividends paid in cash in respect of Disqualified Stock of North
American Van Lines or a Restricted Subsidiary or in respect of Preferred
Stock of a Restricted Subsidiary of North American Van Lines and
minus
(3) to the extent otherwise included in such interest expense referred
to in clause (1) above, Receivables Fees and amortization or write-off of
financing costs,
in each case under clauses (1) through (3) as determined on a Consolidated basis
in accordance with GAAP; provided, that gross interest expense shall be
determined after giving effect to any net payments made or received by North
American Van Lines and its Restricted Subsidiaries with respect to Interest Rate
Agreements.
"Consolidated Net Income" means, for any period, the net income (loss) of
North American Van Lines and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP and before any reduction in respect
of Preferred Stock dividends; provided, that there shall not be included in such
Consolidated Net Income:
(1) any net income (loss) of any Person if such Person is not a
Restricted Subsidiary, except that (A) subject to the limitations contained
in clause (4) below, North American Van Lines' equity in the net income of
any such Person for such period shall be included in such Consolidated Net
Income up to the aggregate amount actually distributed by such Person during
such period to North American Van Lines or a Restricted Subsidiary of North
American Van Lines as a dividend or other distribution
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(subject, in the case of a dividend or other distribution to a Restricted
Subsidiary of North American Van Lines, to the limitations contained in
clause (3) below) and (B) North American Van Lines' equity in the net loss
of such Person shall be included to the extent of the aggregate Investment
of North American Van Lines or any of its Restricted Subsidiaries in such
Person,
(2) any net income (loss) of any Person acquired by North American Van
Lines or a Restricted Subsidiary of North American Van Lines in a pooling of
interests transaction for any period prior to the date of such acquisition,
(3) any net income (loss) of any Restricted Subsidiary of North American
Van Lines if such Restricted Subsidiary is subject to restrictions, directly
or indirectly, on the payment of dividends or the making of similar
distributions by such Restricted Subsidiary, directly or indirectly, to
North American Van Lines by operation of the terms of such Restricted
Subsidiary's charter or any agreement, instrument, judgment, decree, order,
statute or governmental rule or regulation applicable to such Restricted
Subsidiary or its stockholders (other than (x) restrictions that have been
waived or otherwise released, (y) restrictions pursuant to the notes or the
indenture and (z) restrictions in effect on the Issue Date with respect to a
Restricted Subsidiary and other restrictions with respect to such Restricted
Subsidiary that taken as a whole are not materially less favorable to the
noteholders than such restrictions in effect on the Issue Date), except that
(A) subject to the limitations contained in clause (4) below, North American
Van Lines' equity in the net income of any such Restricted Subsidiary for
such period shall be included in such Consolidated Net Income up to the
aggregate amount of any dividend or distribution that was or that could have
been made by such Restricted Subsidiary during such period to North American
Van Lines or another Restricted Subsidiary of North American Van Lines
(subject, in the case of a dividend that could have been made to another
Restricted Subsidiary, to the limitation contained in this clause) and
(B) the net loss of such Restricted Subsidiary shall be included to the
extent of the aggregate Investment of North American Van Lines or any of its
other Restricted Subsidiaries in such Restricted Subsidiary,
(4) any gain or loss realized upon the sale or other disposition of any
asset of North American Van Lines or any Restricted Subsidiary of North
American Van Lines (including pursuant to any sale/ leaseback transaction)
that is not sold or otherwise disposed of in the ordinary course of business
(as determined in good faith by the Board of Directors),
(5) any item classified as an extraordinary, unusual or nonrecurring
gain, loss or charge (including without limitation (a) any compensation
expense for stock options that will be cashed out, converted, exchanged or
otherwise retired in connection with the Allied Acquisition, (b) any charge
or expense incurred for employee bonuses in connection with the Allied
Acquisition, and (c) fees, expenses and charges associated with the Allied
Acquisition or any acquisition, merger or consolidation after the Issue
Date),
(6) the cumulative effect of a change in accounting principles,
(7) all deferred financing costs written off and premiums paid in
connection with any early extinguishment of Indebtedness,
(8) any unrealized gains or losses in respect of Currency Agreements,
(9) any unrealized foreign currency transaction gains or losses in
respect of Indebtedness of any Person denominated in a currency other than
the functional currency of such Person, and
(10) any non-cash compensation charge arising from any grant of stock,
stock options or other equity based awards.
In the case of any unusual or nonrecurring gain, loss or charge not included
in Consolidated Net Income pursuant to clause (5) above in any determination
thereof, North American Van Lines will deliver
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an Officer's Certificate to the trustee promptly after the date on which
Consolidated Net Income is so determined, setting forth the nature and amount of
such unusual or nonrecurring gain, loss or charge.
"Consolidated Tangible Assets" means, as of any date of determination, the
total assets less the total intangible assets (including, without limitation,
goodwill) shown on the consolidated balance sheet of North American Van Lines
and its Restricted Subsidiaries as of the most recent date for which such a
balance sheet is available, determined on a consolidated basis in accordance
with GAAP (and, in the case of any determination relating to any Incurrence of
Indebtedness or any Investment, on a pro forma basis including any property or
assets being acquired in connection therewith).
"Consolidation" means the consolidation of the accounts of each of the
Restricted Subsidiaries with those of North American Van Lines in accordance
with GAAP; provided that "Consolidation" will not include consolidation of the
accounts of any Unrestricted Subsidiary, but the interest of North American Van
Lines or any Restricted Subsidiary in any Unrestricted Subsidiary will be
accounted for as an investment. The term "Consolidated" has a correlative
meaning.
"Credit Facilities" means, one or more of (x) the Senior Credit Facility and
(y) other facilities or arrangements, in each case with one or more banks or
other institutions providing for revolving credit loans, term loans, receivables
financings (including without limitation through the sale of receivables to such
institutions or to special purpose entities formed to borrow from such
institutions against such receivables), letters of credit or other Indebtedness,
in each case, including all agreements, instruments and documents executed and
delivered pursuant to or in connection with any of the foregoing, in each case
as the same may be amended, supplemented, waived or otherwise modified from time
to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time (whether in whole or in part, whether
with the original banks or other institutions or other banks or other
institutions or otherwise, and whether provided under any original Credit
Facility or one or more other credit agreements, indentures, financing
agreements or other Credit Facilities or otherwise). Without limiting the
generality of the foregoing, the term "Credit Facility" shall include any
agreement
(1) changing the maturity of any Indebtedness incurred thereunder or
contemplated thereby,
(2) adding Subsidiaries of North American Van Lines as additional
borrowers or guarantors thereunder,
(3) increasing the amount of Indebtedness incurred thereunder or
available to be borrowed thereunder or
(4) otherwise altering the terms and conditions thereof.
"Currency Agreement" means, in respect of a Person, any foreign exchange
contract, currency swap agreement or other similar agreement or arrangements
(including derivative agreements or arrangements), as to which such Person is a
party or a beneficiary.
"Default" means any event or condition that is, or after notice or passage
of time or both would be, an Event of Default.
"Designated Noncash Assets" means any non-cash consideration received by
North American Van Lines or one of its Restricted Subsidiaries in connection
with an Asset Disposition that is designated as Designated Noncash Assets
pursuant to an Officer's Certificate executed by the principal financial officer
of North American Van Lines or such Restricted Subsidiary. Such Officer's
Certificate shall state the basis of valuation of such consideration which shall
be the good faith determination of the Board of Directors. The fair market value
of each outstanding item of Designated Noncash Assets shall equal its value
measured at the time received and without giving effect to subsequent changes in
value, less the amount of cash or Cash Equivalents received upon any subsequent
sale or other disposition of any portion thereof; provided that such cash and
Cash Equivalents are applied in accordance with the covenant described under
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"--Certain Covenants--Limitation on Sales of Assets and Subsidiary Stock," to
the extent required thereby.
"Designated Senior Indebtedness" means (1) the Bank Indebtedness and
(2) any other Senior Indebtedness that, at the date of determination, has an
aggregate principal amount equal to or under which, at the date of
determination, the holders thereof are committed to lend up to, at least
$25.0 million and is specifically designated by North American Van Lines in an
agreement or instrument evidencing or governing such Senior Indebtedness as
"Designated Senior Indebtedness" for purposes of the indenture.
"Disinterested Director" means, with respect to any Affiliate Transaction, a
member of the Board of Directors having no material direct or indirect financial
interest in or with respect to such Affiliate Transaction. A member of the Board
of Directors shall not be deemed to have such a financial interest by reason of
such member's holding Capital Stock of North American Van Lines or Holding or
any options, warrants or other rights in respect of such Capital Stock.
"Disqualified Stock" means, with respect to any Person, any Capital Stock
(other than Management Stock) that by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable or exercisable) or
upon the happening of any event
(1) matures or is mandatorily redeemable pursuant to a sinking fund
obligation or otherwise,
(2) is convertible or exchangeable for Indebtedness or Disqualified
Stock or
(3) is redeemable at the option of the holder thereof, in whole or in
part, in each case on or prior to the 91(st) day following the final Stated
Maturity of the notes.
Notwithstanding the preceding sentence,
(a) any Capital Stock that would constitute Disqualified Stock solely
because the holders thereof have the right to require North American Van
Lines to repurchase such Capital Stock upon the occurrence of an event
described therein as a change of control or an asset sale shall not
constitute Disqualified Stock if the terms of such Capital Stock provide
that North American Van Lines may not repurchase or redeem any such Capital
Stock pursuant to such provisions unless such repurchase or redemption
complies with the covenant described above under the caption "--Certain
Covenants--Limitation on Restricted Payments"; and
(b) any Capital Stock that would constitute Disqualified Stock solely
because such Capital Stock is issued pursuant to any plan for the benefit of
employees and may be required to be repurchased by North American Van Lines
in order to satisfy applicable regulatory obligations shall not constitute
Disqualified Stock.
"Domestic Subsidiary" means any Restricted Subsidiary of North American Van
Lines other than a Foreign Subsidiary.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Financing Disposition" means any sale, transfer, conveyance or other
disposition of property or assets by North American Van Lines or any Subsidiary
thereof to any Receivables Entity, or by any Receivables Subsidiary, in each
case in connection with the Incurrence by a Receivables Entity of Indebtedness,
or obligations to make payments to the obligor on Indebtedness, which may be
secured by a Lien in respect of such property or assets.
"Foreign Subsidiary" means
(a) any Restricted Subsidiary of North American Van Lines that is not
organized under the laws of the United States of America or any state
thereof or the District of Columbia and
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(b) any Restricted Subsidiary of North American Van Lines that has no
material assets other than securities of one or more Foreign Subsidiaries,
and other assets relating to an ownership interest in any such securities or
Subsidiaries.
"Foreign Subsidiary Coverage Ratio" as of any date of determination means
the ratio of
(1) the combined portion attributable to Foreign Subsidiaries, taken as
a whole, of the aggregate amount of Consolidated EBITDA of North American
Van Lines and its Restricted Subsidiaries for the period of the most recent
four consecutive fiscal quarters ending prior to the date of such
determination for which consolidated financial statements of North American
Van Lines are available to
(2) the combined portion attributable to Foreign Subsidiaries, taken as
a whole, of Consolidated Interest Expense for such four fiscal quarters,
all calculated after giving effect to all intercompany eliminations applied in
preparing the relevant consolidated financial statements of North American Van
Lines (and without giving effect to clause (3) of the definition of the term
Consolidated Net Income as it relates to restrictions on the payment of
dividends or the making of similar distributions by any Foreign Subsidiary to
North American Van Lines or any Domestic Sudsidiary, but giving effect to such
clause as it relates to any such restrictions on the payment of dividends or the
making of similar distributions by any Foreign Subsidiary to another Foreign
Subsidiary), and otherwise in accordance with the definition of the term
"Coverage Ratio" (including but not limited to in accordance with all pro forma
and other adjustments provided for in such definition).
"GAAP" means generally accepted accounting principles in the United States
of America as in effect on the Issue Date (for purposes of the definitions of
the terms "Consolidated Coverage Ratio," "Foreign Subsidiary Coverage Ratio,"
"Consolidated EBITDA," "Consolidated Interest Expense," "Consolidated Net
Income" and "Consolidated Tangible Assets," all defined terms in the indenture
to the extent used in or relating to any of the foregoing definitions, and all
ratios and computations based on any of the foregoing definitions) and as in
effect from time to time (for all other purposes of the indenture), including
those set forth in the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession. All ratios and computations based on GAAP contained in
the indenture shall be computed in conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of any Person
directly or indirectly guaranteeing any Indebtedness or other obligation of any
other Person; provided that the term "Guarantee" shall not include endorsements
for collection or deposit in the ordinary course of business. The term
"Guarantee" used as a verb has a corresponding meaning.
"Guarantor Senior Indebtedness" means, with respect to any Note Guarantor,
the following obligations, whether outstanding on the date of the indenture or
thereafter issued, without duplication:
(a) any Guarantee of Bank Indebtedness by such Note Guarantor and all
other Guarantees by such Note Guarantor of Senior Indebtedness of North
American Van Lines or Guarantor Senior Indebtedness of any other Note
Guarantor;
(b) all obligations in respect of any Receivables Financing; and
(c) all obligations consisting of the principal of and premium, if any,
and accrued and unpaid interest (including interest accruing on or after the
filing of any petition in bankruptcy or for reorganization relating to the
Note Guarantor regardless of whether post-filing interest is allowed in such
proceeding) on, and fees and other amounts owing in respect of, all other
Indebtedness of the Note Guarantor, unless, in the instrument creating or
evidencing the same or pursuant to which the
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same is outstanding, it is expressly provided that the obligations in
respect of such Indebtedness are not senior in right of payment to the
obligations of such Note Guarantor under its Note Guarantee;
provided, however, that Guarantor Senior Indebtedness shall not include
(1) any obligations of such Note Guarantor to North American Van Lines
or any other Subsidiary of North American Van Lines,
(2) any liability for Federal, state, local, foreign or other taxes owed
or owing by such Note Guarantor,
(3) any accounts payable or other liability to trade creditors arising
in the ordinary course of business (including Guarantees thereof or
instruments evidencing such liabilities),
(4) any Indebtedness of such Note Guarantor (or Guarantee by such Note
Guarantor of Indebtedness) that is expressly subordinated in right of
payment to any other Indebtedness of such Note Guarantor (or Guarantee by
such Note Guarantor of Indebtedness),
(5) any Capital Stock of such Note Guarantor or
(6) that portion of any Indebtedness of such Note Guarantor that is
Incurred by such Note Guarantor in violation of the covenant described under
"--Certain Covenants--Limitation on Indebtedness" (but no such violation
shall be deemed to exist for purposes of this clause (6) if any holder of
such Indebtedness or such holder's representative shall have received an
Officer's Certificate to the effect that such Incurrence of such
Indebtedness does not (or that the Incurrence by such Note Guarantor of the
entire committed amount thereof at the date on which the initial borrowing
thereunder is made would not) violate such covenant).
If any Guarantor Senior Indebtedness is disallowed, avoided or subordinated
pursuant to the provisions of Section 548 of Title 11 of the United States Code
or any applicable state fraudulent conveyance law, such Guarantor Senior
Indebtedness nevertheless will constitute Guarantor Senior Indebtedness.
"Guarantor Senior Subordinated Indebtedness" means, with respect to a Note
Guarantor, (1) the obligations of such Note Guarantor under its Note Guarantee
and (2) any other Indebtedness of such Note Guarantor that ranks PARI PASSU in
right of payment with the obligations of such Note Guarantor under its Note
Guarantee.
"Guarantor Subordinated Obligations" means, with respect to a Note
Guarantor, any Indebtedness of such Note Guarantor (whether outstanding on the
Issue Date or thereafter Incurred) that is expressly subordinated in right of
payment to the obligations of such Note Guarantor under the Note Guarantee
pursuant to a written agreement.
"Hedging Obligations" of any Person means the obligations of such Person
pursuant to any Interest Rate Agreement or Currency Agreement.
"holder" or "noteholder" means the Person in whose name a note is registered
in the Note Register.
"Holding" means NA Holding Corporation, a Delaware corporation, and any
successor in interest thereto.
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"Holding Expenses" means
(1) costs (including all professional fees and expenses) incurred by
Holding to comply with its reporting obligations under federal or state laws
or under the indenture or the Holding Notes, including any reports filed
with respect to the Securities Act, Exchange Act or the respective rules and
regulations promulgated thereunder,
(2) indemnification obligations of Holding owing to directors, officers,
employees or other Persons under its charter or by-laws or pursuant to
written agreements with any such Person,
(3) fees and expenses payable by Holding in connection with the
Transactions,
(4) other operational expenses of Holding incurred in the ordinary
course of business,
(5) expenses incurred by Holding in connection with any public offering
of Capital Stock or Indebtedness (X) where the net proceeds of such offering
are intended to be received by or contributed or loaned to North American
Van Lines or a Restricted Subsidiary, or (Y) in a prorated amount of such
expenses in proportion to the amount of such net proceeds intended to be so
received, contributed or loaned, or (Z) otherwise on an interim basis prior
to completion of such offering so long as Holding shall cause the amount of
such expenses to be repaid to North American Van Lines or the relevant
Restricted Subsidiary out of the proceeds of such offering promptly if
completed, and
(6) interest payments on the Holding Loan for any period or portion
thereof ending on or prior to December 31, 1999.
"Holding Loan" means $40.0 million in aggregate principal amount of
Indebtedness Incurred by Holding in connection with the Transactions.
"Holding Notes" means the senior discount notes due 2009 issued (or any
Indebtedness in lieu thereof Incurred) by Holding on the Issue Date, and any
refinancing in respect thereof, together with any agreement or instrument
evidencing, governing or otherwise relating to any of the foregoing.
"Holding Stock Issuance" means one or more issuances by Holding, subsequent
to the Issue Date, of Capital Stock of Holding for gross proceeds of not less
than $40.0 million in the aggregate.
"Incur" means issue, assume, enter into any Guarantee of, incur or otherwise
become liable for; provided, however, that any Indebtedness or Capital Stock of
a Person existing at the time such Person becomes a Subsidiary (whether by
merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred
by such Subsidiary at the time it becomes a Subsidiary. Accrual of interest, the
accretion of accreted value and the payment of interest in the form of
additional Indebtedness will not be deemed to be an Incurrence of Indebtedness.
Any Indebtedness issued at a discount (including Indebtedness on which interest
is payable through the issuance of additional Indebtedness) shall be deemed
Incurred at the time of original issuance of the Indebtedness at the initial
accreted amount thereof. The term "Incurrence" shall have a correlative meaning.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication):
(1) the principal of indebtedness of such Person for borrowed money,
(2) the principal of obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments,
(3) all reimbursement obligations of such Person in respect of letters of
credit or other similar instruments (the amount of such obligations being
equal at any time to the aggregate then undrawn and unexpired amount of
such letters of credit or other instruments plus the aggregate amount of
drawings thereunder that have not then been reimbursed),
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(4) all obligations of such Person to pay the deferred and unpaid purchase
price of property (except Trade Payables), which purchase price is due
more than one year after the date of placing such property in final
service or taking final delivery and title thereto,
(5) all Capitalized Lease Obligations of such Person,
(6) the redemption, repayment or other repurchase amount of such Person with
respect to any Disqualified Stock of such Person or (if such Person is a
Subsidiary of North American Van Lines other than a Note Guarantor) any
Preferred Stock of such Subsidiary, but excluding, in each case, any
accrued dividends (the amount of such obligation to be equal at any time
to the maximum fixed involuntary redemption, repayment or repurchase
price for such Capital Stock, or if less (or if such Capital Stock has no
such fixed price), to the involuntary redemption, repayment or repurchase
price therefor calculated in accordance with the terms thereof as if then
redeemed, repaid or repurchased, and if such price is based upon or
measured by the fair market value of such Capital Stock, such fair market
value shall be as determined in good faith by the Board of Directors or
the board of directors or other governing body of the issuer of such
Capital Stock),
(7) all Indebtedness of other Persons secured by a Lien on any asset of such
Person, whether or not such Indebtedness is assumed by such Person;
provided that the amount of Indebtedness of such Person shall be the
lesser of (A) the fair market value of such asset at such date of
determination (as determined in good faith by North American Van Lines)
and (B) the amount of such Indebtedness of such other Persons,
(8) Guarantees of all Indebtedness of other Persons to the extent so
Guaranteed by such Person, and
(9) to the extent not otherwise included in this definition, net Hedging
Obligations of such Person (the amount of any such obligation to be equal
at any time to the termination value of such agreement or arrangement
giving rise to such Hedging Obligation that would be payable by such
Person at such time).
The amount of Indebtedness of any Person at any date shall be determined as
set forth above or otherwise provided in the indenture, or otherwise shall equal
the amount thereof that would appear on a balance sheet of such Person
(excluding any notes thereto) prepared in accordance with GAAP.
"Interest Rate Agreement" means, with respect to any Person, any interest
rate protection agreement, interest rate future agreement, interest rate option
agreement, interest rate swap agreement, interest rate cap agreement, interest
rate collar agreement, interest rate hedge agreement or other similar agreement
or arrangement (including derivative agreements or arrangements), as to which
such Person is party or a beneficiary.
"Inventory" means goods held for sale or lease by a Person in the ordinary
course of business, net of any reserve for goods that have been segregated by
such Person to be returned to the applicable vendor for credit, as determined in
accordance with GAAP.
"Investment" in any Person by any other Person means any direct or indirect
advance, loan or other extension of credit (other than to customers, suppliers,
Agents, directors, officers or employees of any Person in the ordinary course of
business) or capital contribution (by means of any transfer of cash or other
property to others or any payment for property or services for the account or
use of others) to, or any purchase or acquisition of Capital Stock, Indebtedness
or other similar instruments issued by, such Person. For purposes of the
definition of "Unrestricted Subsidiary" and the covenant described under
"--Certain Covenants--Limitation on Restricted Payments,"
(1) "Investment" shall include the portion (proportionate to North
American Van Lines' equity interest in such Subsidiary) of the fair market
value of the net assets of any Subsidiary of North American Van Lines at the
time that such Subsidiary is designated an Unrestricted Subsidiary, provided
that upon a redesignation of such Subsidiary as a Restricted Subsidiary,
North American Van
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Lines shall be deemed to continue to have a permanent "Investment" in an
Unrestricted Subsidiary in an amount (if positive) equal to (X) North
American Van Lines' "Investment" in such Subsidiary at the time of such
redesignation less (Y) the portion (proportionate to North American Van
Lines' equity interest in such Subsidiary) of the fair market value of the
net assets of such Subsidiary at the time of such redesignation,
(2) property transferred to or from an Unrestricted Subsidiary shall be
valued at its fair market value at the time of such transfer, and
(3) in each case under clause (1) or (2) above, fair market value shall
be as determined in good faith by the Board of Directors. A Guarantee shall
not be deemed to be or give rise to an Investment until such Guarantee is
funded (in whole or in part).
The amount of any Investment outstanding at any time shall be the original cost
of such Investment, reduced (at North American Van Lines' option) by any
dividend, distribution, interest payment, return of capital, repayment or other
amount or value received in respect of such Investment; provided, that to the
extent that the amount of Restricted Payments outstanding at any time is so
reduced by any portion of any such amount or value that would otherwise be
included in the calculation of Consolidated Net Income, such portion of such
amount or value shall not be so included for purposes of calculating the amount
of Restricted Payments that may be made pursuant to paragraph (a) of the
covenant described under "--Certain Covenants--Limitation on Restricted
Payments."
"Investors" means CDR Fund V.
"Issue Date" means the first date on which notes are issued.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien or
charge of any kind (including any conditional sale or other title retention
agreement or lease in the nature thereof).
"Management Advances" means
(1) loans or advances made to directors, officers or employees of
Holding, North American Van Lines or any Restricted Subsidiary (x) in
respect of travel, entertainment or moving-related expenses incurred in the
ordinary course of business, (y) in respect of moving-related expenses
incurred in connection with any closing or consolidation of any facility, or
(z) in the ordinary course of business and (in the case of this clause (z))
not exceeding $2.5 million in the aggregate outstanding at any time,
(2) promissory notes of Management Investors acquired in connection with
the issuance of Management Stock to such Management Investors,
(3) loans to Management Investors of funds applied to purchase
Management Stock in an aggregate principal amount not exceeding
$10.0 million outstanding at any time (less the aggregate principal amount
of then outstanding borrowings by Management Investors then guaranteed by
North American Van Lines pursuant to clause (x) of the definition of
Management Guarantees),
(4) Management Guarantees, or
(5) other Guarantees of borrowings by Management Investors in connection
with the purchase of Management Stock, which Guarantees are permitted under
the covenant described under "--Certain Covenants--Limitation on
Indebtedness."
"Management Agreements" means, collectively, the Consulting Agreement, dated
as of March 30, 1998, among Holding, North American Van Lines and CDR (and, in
each case, its respective permitted successors and assigns thereunder) and the
Indemnification Agreement, dated as of March 30, 1998, among Holding, North
American Van Lines, CDR and the Investors (and, in each case, its respective
permitted successors and assigns thereunder), as each may be amended,
supplemented, waived or otherwise modified from time to time in accordance with
the terms thereof and of the indenture.
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"Management Guarantees" means guarantees
(x) of up to an aggregate principal amount of $10.0 million of
borrowings by Management Investors in connection with their purchase of
Management Stock outstanding at any time (less the aggregate principal
amount of then outstanding loans made to Management Investors by North
American Van Lines pursuant to clause (3) of the definition of Management
Advances) or
(y) made on behalf of, or in respect of loans or advances made to,
directors, officers or employees of Holding, North American Van Lines or any
Restricted Subsidiary (1) in respect of travel, entertainment and
moving-related expenses incurred in the ordinary course of business, or
(2) in the ordinary course of business and (in the case of this clause (2))
not exceeding $2.5 million in the aggregate outstanding at any time.
"Management Investors" means the officers, directors, employees and other
members of the management of Holding, North American Van Lines or any of their
respective Subsidiaries (or of any Agent), or family members or relatives
thereof, or trusts or partnerships for the benefit of any of the foregoing, or
any of their heirs, executors, successors and legal representatives, or any
Agent, who at any date beneficially own or have the right to acquire, directly
or indirectly, Capital Stock of North American Van Lines or Holding.
"Management Stock" means Capital Stock of North American Van Lines or
Holding (including any options, warrants or other rights in respect thereof)
held by any of the Management Investors.
"Moody's" means Moody's Investors Service, Inc., and its successors.
"Net Available Cash" from an Asset Disposition means cash payments received
(including any cash payments received by way of deferred payment of principal
pursuant to a note or installment receivable or otherwise, but only as and when
received, but excluding any other consideration received in the form of
assumption by the acquiring person of Indebtedness or other obligations relating
to the properties or assets that are the subject of such Asset Disposition or
received in any other non-cash form) therefrom, in each case net of
(1) all legal, title and recording tax expenses, commissions and other
fees and expenses incurred, and all Federal, state, provincial, foreign and
local taxes required to be paid or accrued as a liability under GAAP, as a
consequence of such Asset Disposition (including as a consequence of any
transfer of funds in connection with the application thereof in accordance
with the covenant described under "--Certain Covenants--Limitation on Sales
of Assets and Subsidiary Stock"),
(2) all payments made, and all installment payments required to be made,
on any Indebtedness that is secured by any assets subject to such Asset
Disposition, in accordance with the terms of any Lien upon such assets, or
that must by its terms, or in order to obtain a necessary consent to such
Asset Disposition, or by applicable law, be repaid out of the proceeds from
such Asset Disposition,
(3) all distributions and other payments required to be made to minority
interest holders in Subsidiaries or joint ventures as a result of such Asset
Disposition, or to any other Person (other than North American Van Lines or
a Restricted Subsidiary) owning a beneficial interest in the assets disposed
of in such Asset Disposition and
(4) any liabilities or obligations associated with the assets disposed
of in such Asset Disposition and retained by North American Van Lines or any
Restricted Subsidiary after such Asset Disposition, including without
limitation pension and other post-employment benefit liabilities,
liabilities related to environmental matters, and liabilities relating to
any indemnification obligations associated with such Asset Disposition.
"Net Cash Proceeds," with respect to any issuance or sale of any securities
of North American Van Lines or any Subsidiary by North American Van Lines or any
Subsidiary, or any capital contribution, means
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the cash proceeds of such issuance, sale or contribution net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees actually incurred in
connection with such issuance, sale or contribution and net of taxes paid or
payable as a result thereof.
"Note Guarantee" means any of (1) the guarantees of the notes by the
Domestic Subsidiaries to be entered into on the Issue Date as described under
"--Note Guarantees," and (2) any guarantee that may from time to time be entered
into by a Restricted Subsidiary of North American Van Lines pursuant to the
covenant described under "--Certain Covenants--Future Note Guarantors."
"Note Guarantor" means any Restricted Subsidiary of North American Van Lines
that enters into a Note Guarantee.
"Officer" means, with respect to North American Van Lines or any other
obligor upon the notes, the Chairman of the Board, the President, the Chief
Executive Officer, the Chief Financial Officer, any Vice President, the
Controller, the Treasurer or the Secretary (a) of such Person or (b) if such
Person is owned or managed by a single entity, of such entity (or any other
individual designated as an "Officer" for the purposes of the indenture by the
Board of Directors).
"Officer's Certificate" means, with respect to North American Van Lines or
any other obligor upon the notes, a certificate signed by one Officer of such
Person.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the trustee. The counsel may be an employee of or
counsel to North American Van Lines or the trustee.
"Permitted Holder" means any of the following: (1) any of the Investors,
Management Investors, CDR and their respective Affiliates; (2) any investment
fund or vehicle managed, sponsored or advised by CDR; and (3) any Person acting
in the capacity of an underwriter in connection with a public or private
offering of Capital Stock of Holding or North American Van Lines.
"Permitted Investment" means an Investment by North American Van Lines or
any Restricted Subsidiary in, or consisting of, any of the following:
(1) a Restricted Subsidiary, North American Van Lines, or a Person that
will, upon the making of such Investment, become a Restricted
Subsidiary;
(2) another Person if as a result of such Investment such other Person is
merged or consolidated with or into, or transfers or conveys all or
substantially all its assets to, or is liquidated into, North American
Van Lines or a Restricted Subsidiary;
(3) Temporary Cash Investments or Cash Equivalents;
(4) receivables owing to North American Van Lines or any Restricted
Subsidiary, if created or acquired in the ordinary course of business;
(5) any securities or other Investments received as consideration in, or
retained in connection with, sales or other dispositions of property or
assets, including Asset Dispositions made in compliance with the
covenant described under "--Certain Covenants--Limitation on Sales of
Assets and Subsidiary Stock";
(6) securities or other Investments received in settlement of debts created
in the ordinary course of business and owing to North American Van Lines
or any Restricted Subsidiary, or as a result of foreclosure, perfection
or enforcement of any Lien, or in satisfaction of judgments, including
in connection with any bankruptcy proceeding or other reorganization of
another Person;
(7) Investments in existence or made pursuant to legally binding written
commitments in existence on the Issue Date;
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(8) Currency Agreements, Interest Rate Agreements and related Hedging
Obligations, which obligations are Incurred in compliance with the
covenant described under "--Certain Covenants--Limitation on
Indebtedness";
(9) pledges or deposits (x) with respect to leases or utilities provided to
third parties in the ordinary course of business or (y) otherwise
described in the definition of "Permitted Liens" or made in connection
with Liens permitted under the covenant described under "--Certain
Covenants--Limitation on Liens";
(10) Investments in joint ventures or similar entities that are not
Restricted Subsidiaries, or in any Related Business, in an aggregate
amount outstanding at any time not to exceed the greater of
(x) $15.0 million and (y) 2.5% of Consolidated Tangible Assets;
(11) (1) Investments in any Receivables Subsidiary, or in connection with a
Financing Disposition by or to any Receivables Entity, including
Investments of funds held in accounts permitted or required by the
arrangements governing such Financing Disposition or any related
Indebtedness, or (2) any promissory note issued by North American Van
Lines or Holding, provided that if Holding receives cash from the
relevant Receivables Entity in exchange for such note, an equal cash
amount is contributed by Holding to North American Van Lines;
(12) bonds secured by assets leased to and operated by North American Van
Lines or any Restricted Subsidiary that were issued in connection with
the financing of such assets so long as North American Van Lines or any
Restricted Subsidiary may obtain title to such assets at any time by
paying a nominal fee, canceling such bonds and terminating the
transaction;
(13) notes;
(14) any Investment to the extent made using Capital Stock of North American
Van Lines (other than Disqualified Stock), or Capital Stock of Holding,
as consideration;
(15) Management Advances and payments in respect thereof;
(16) Agent Guarantees in an aggregate principal amount not exceeding
$10.0 million outstanding at any time and payments in respect thereof;
and
(17) other Investments in an aggregate amount outstanding at any time not to
exceed $10.0 million.
"Permitted Junior Securities" means:
(a) debt securities of North American Van Lines as reorganized or
readjusted, if applicable, and guaranteed by the Note Guarantors, or
debt securities of North American Van Lines (or any other company, trust
or organization provided for by a plan of reorganization or readjustment
succeeding to the assets and liabilities of North American Van Lines)
and guaranteed by the Note Guarantors, in each of the foregoing cases,
which securities and guarantees are subordinated, to at least the same
extent as the notes and the Note Guarantees, to the payment of all
Senior Indebtedness and guarantees thereof that will be outstanding
after giving effect to such reorganization or readjustment, if
applicable, so long as
(1) such debt securities are not entitled to the benefit of covenants
or defaults more beneficial to the holders of such debt securities than
those in effect with respect to the notes (or the Senior Indebtedness,
after giving effect to such reorganization or readjustment, if
applicable) and
(2) such debt securities shall not provide for amortization-including
sinking fund and mandatory prepayment provisions (other than a mandatory
prepayment of the type described under the caption "--Change of Control")
commencing prior to the date which is one year after
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the final scheduled maturity date of the Senior Indebtedness (as modified
by such reorganization or readjustment, if applicable),
or
(b) Capital Stock in North American Van Lines or any Note Guarantor;
provided, that in each case with respect to clauses (a) and (b) above, if a
new corporation results from any such reorganization or readjustment, such
corporation assumes all Senior Indebtedness that will be outstanding after
giving effect thereto and provided further, that the rights of the holders of
Senior Indebtedness are not impaired.
"Permitted Liens" means:
(a) Liens for taxes, assessments or other governmental charges not yet
delinquent or the nonpayment of which in the aggregate would not
reasonably be expected to have a material adverse effect on North
American Van Lines and its Restricted Subsidiaries, or that are being
contested in good faith and by appropriate proceedings if adequate
reserves with respect thereto are maintained on the books of North
American Van Lines or a Subsidiary thereof, as the case may be, in
accordance with GAAP;
(b) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business in respect of obligations that are not overdue for a period of
more than 60 days, or that are bonded or that are being contested in good
faith and by appropriate proceedings;
(c) pledges, deposits or Liens in connection with workers' compensation,
unemployment insurance and other social security and other similar
legislation or other insurance-related obligations (including, without
limitation, pledges or deposits securing liability to insurance carriers
under insurance or self-insurance arrangements);
(d) pledges, deposits or Liens to secure the performance of bids, tenders,
trade, government or other contracts (other than for borrowed money),
obligations for utilities, leases, licenses, statutory obligations,
completion guarantees, surety, judgment, appeal or performance bonds,
other similar bonds, instruments or obligations, and other obligations of
a like nature incurred in the ordinary course of business;
(e) easements (including reciprocal easement agreements), rights-of-way,
building, zoning and similar restrictions, utility agreements, covenants,
reservations, restrictions, encroachments, changes, and other similar
encumbrances or title defects incurred, or leases or subleases granted to
others, in the ordinary course of business, which do not in the aggregate
materially interfere with the ordinary conduct of the business of North
American Van Lines and its Subsidiaries, taken as a whole;
(f) Liens existing on, or provided for under written arrangements existing
on, the Issue Date, or (in the case of any such Liens securing
Indebtedness of North American Van Lines or any of its Subsidiaries
existing or arising under written arrangements existing on the Issue
Date) securing any Refinancing Indebtedness in respect of such
Indebtedness so long as the Lien securing such Refinancing Indebtedness
is limited to all or part of the same property or assets (plus
improvements, accessions, proceeds or dividends or distributions in
respect thereof) that secured (or under such written arrangements could
secure) the original Indebtedness;
(g) (1) mortgages, liens, security interests, restrictions, encumbrances or
any other matters of record that have been placed by any developer,
landlord or other third party on property over which North American Van
Lines or any Restricted Subsidiary of North American Van Lines has
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easement rights or on any leased property and subordination or similar
agreements relating thereto and (2) any condemnation or eminent domain
proceedings affecting any real property;
(h) Liens securing Hedging Obligations, Purchase Money Obligations or
Capitalized Lease Obligations Incurred in compliance with the covenant
described under "--Certain Covenants--Limitation on Indebtedness";
(i) Liens arising out of judgments, decrees, orders or awards in respect of
which North American Van Lines shall in good faith be prosecuting an
appeal or proceedings for review, which appeal or proceedings shall not
have been finally terminated, or if the period within which such appeal
or proceedings may be initiated shall not have expired;
(j) leases, subleases, licenses or sublicenses to third parties;
(k) Liens securing
(1) Indebtedness Incurred in compliance with clause (b)(1), (b)(4),
(b)(5), (b)(7) or (b)(8)(F) of the covenant described under "--Certain
Covenants--Limitation on Indebtedness,"
(2) Bank Indebtedness,
(3) commercial bank Indebtedness,
(4) the notes or
(5) Indebtedness or other obligations of any Receivables Entity;
(l) Liens existing on property or assets of a Person at the time such Person
becomes a Subsidiary of North American Van Lines (or at the time North
American Van Lines or a Restricted Subsidiary acquires such property or
assets); provided, however, that such Liens are not created in connection
with, or in contemplation of, such other Person becoming such a
Subsidiary (or such acquisition of such property or assets), and that
such Liens are limited to all or part of same property or assets (plus
improvements, accessions, proceeds or dividends or distributions in
respect thereof) that secured (or, under the written arrangements under
which such Liens arose, could secure) the obligations to which such Liens
relate;
(m) Liens on Capital Stock or other securities of an Unrestricted Subsidiary
that secure Indebtedness or other obligations of such Unrestricted
Subsidiary;
(n) any encumbrance or restriction (including, but not limited to, put and
call agreements) with respect to Capital Stock of any joint venture or
similar arrangement pursuant to any joint venture or similar agreement;
and
(o) Liens securing Refinancing Indebtedness Incurred in respect of any
Indebtedness secured by, or securing any refinancing, refunding,
extension, renewal or replacement (in whole or in part) of any other
obligation secured by, any other Permitted Liens, provided that any such
new Lien is limited to all or part of the same property or assets (plus
improvements, accessions, proceeds or dividends or distributions in
respect thereof) that secured (or, under the written arrangements under
which the original Lien arose, could secure) the obligations to which
such Liens relate.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock" as applied to the Capital Stock of any corporation means
Capital Stock of any class or classes (however designated) that by its terms is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
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"Purchase Money Obligations" means any Indebtedness Incurred to finance or
refinance the acquisition, leasing, construction or improvement of property
(real or personal) or assets, and whether acquired through the direct
acquisition of such property or assets or the acquisition of the Capital Stock
of any Person owning such property or assets, or otherwise.
"Qualified Proceeds" means property or assets that are used, usable or
useful in, or a majority of the Voting Stock of any Person engaged in, a Related
Business; provided that the fair market value of any such assets or Capital
Stock shall be determined by the Board of Directors in good faith.
"Receivable" means a right to receive payment arising from a sale or lease
of goods or services by a Person pursuant to an arrangement with another Person
pursuant to which such other Person is obligated to pay for goods or services
under terms that permit the purchase of such goods and services on credit, as
determined in accordance with GAAP.
"Receivables Entity" means
(x) any Receivables Subsidiary or
(y) any other Person that is engaged in the business of acquiring,
selling, collecting, financing or refinancing Receivables, accounts (as
defined in the Uniform Commercial Code as in effect in any jurisdiction from
time to time), other accounts and/or other receivables, and/or related
assets.
"Receivables Fees" means distributions or payments made directly or by means
of discounts with respect to any participation interest issued or sold in
connection with, and other fees paid to a Person that is not a Restricted
Subsidiary in connection with, any Receivables Financing.
"Receivables Financing" means any financing of Receivables of North American
Van Lines or any Restricted Subsidiary that have been transferred to a
Receivables Entity in a Financing Disposition.
"Receivables Subsidiary" means a Subsidiary of North American Van Lines that
(a) is engaged solely in the business of acquiring, selling, collecting,
financing or refinancing Receivables, accounts (as defined in the Uniform
Commercial Code as in effect in any jurisdiction from time to time) and
other accounts and receivables (including any thereof constituting or
evidenced by chattel paper, instruments or general intangibles), all
proceeds thereof and all rights (contractual and other), collateral and
other assets relating thereto, and any business or activities incidental or
related to such business, and
(b) is designated as a "Receivables Subsidiary" by the Board of
Directors.
"Receivables Repurchase Obligation" means any obligation of a seller of
receivables to repurchase receivables (including Receivables, accounts (as
defined in the Uniform Commercial Code as in effect in any jurisdiction from
time to time) and other accounts and receivables (including any thereof
constituting or evidenced by chattel paper, instruments or general intangibles))
arising as a result of a breach of a representation, warranty or covenant or
otherwise, including as a result of a receivable or portion thereof becoming
subject to any asserted defense, dispute, off-set or counterclaim of any kind as
a result of any action taken by, any failure to take action by or any other
event relating to the seller.
"refinance" means refinance, refund, replace, renew, repay, modify, restate,
defer, substitute, supplement, reissue, resell or extend (including pursuant to
any defeasance or discharge mechanism); and the terms "refinances," "refinanced"
and "refinancing" as used for any purpose in the indenture shall have a
correlative meaning.
"Refinancing Indebtedness" means Indebtedness that is Incurred to refinance
any Indebtedness existing on the date of the indenture or Incurred in compliance
with the indenture (including Indebtedness of North American Van Lines that
refinances Indebtedness of any Restricted Subsidiary (to the extent permitted in
the indenture) and Indebtedness of any Restricted Subsidiary that refinances
Indebtedness of
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another Restricted Subsidiary) including Indebtedness that refinances
Refinancing Indebtedness; provided, that
(1) if the Indebtedness being refinanced is Subordinated Obligations or
Guarantor Subordinated Obligations, the Refinancing Indebtedness has an
Average Life at the time such Refinancing Indebtedness is Incurred that is
equal to or greater than the Average Life of the Indebtedness being
refinanced,
(2) such Refinancing Indebtedness is Incurred in an aggregate principal
amount (or if issued with original issue discount, an aggregate issue price)
that is equal to or less than the sum of (x) the aggregate principal amount
(or if issued with original issue discount, the aggregate accreted value)
then outstanding of the Indebtedness being refinanced, plus (y) fees,
underwriting discounts, premiums and other costs and expenses incurred in
connection with such Refinancing Indebtedness and
(3) Refinancing Indebtedness shall not include (x) Indebtedness of a
Restricted Subsidiary that is not a Note Guarantor that refinances
Indebtedness of North American Van Lines or a Note Guarantor that was
incurred by North American Van Lines or a Note Guarantor pursuant to
paragraph (a) of the covenant described under "--Certain
Covenants-Limitation on Indebtedness" or (y) Indebtedness of North American
Van Lines or a Restricted Subsidiary that refinances Indebtedness of an
Unrestricted Subsidiary.
"Related Business" means those businesses in which North American Van Lines
or any of its Subsidiaries is engaged on the date of the indenture, or that are
related, complementary, incidental or ancillary thereto or extensions,
developments or expansions thereof.
"Related Taxes" means
(x) any taxes, charges or assessments, including but not limited to
sales, use, transfer, rental, ad valorem, value-added, stamp, property,
consumption, franchise, license, capital, net worth, gross receipts, excise,
occupancy, intangibles or similar taxes, charges or assessments (other than
federal, state or local taxes measured by income and federal, state or local
withholding imposed on payments made by Holding), required to be paid by
Holding by virtue of its being incorporated or having Capital Stock
outstanding (but not by virtue of owning stock or other equity interests of
any corporation or other entity other than North American Van Lines or any
of its Subsidiaries), or being a holding company parent of North American
Van Lines or receiving dividends from or other distributions in respect of
the Capital Stock of North American Van Lines, or having guaranteed any
obligations of North American Van Lines or any Subsidiary thereof, or having
made any payment in respect of any of the items for which North American Van
Lines is permitted to make payments to Holding pursuant to the covenant
described under "--Certain Covenants--Limitation on Restricted Payments," or
(y) any other federal, state, foreign, provincial or local taxes
measured by income for which Holding is liable up to an amount not to exceed
with respect to such federal taxes the amount of any such taxes that North
American Van Lines would have been required to pay on a separate company
basis or on a consolidated basis if North American Van Lines had filed a
consolidated return on behalf of an affiliated group (as defined in
Section 1504 of the Code or an analogous provision of state, local or
foreign law) of which it were the common parent, or with respect to state
and local taxes, on a combined basis if North American Van Lines had filed a
combined return on behalf of an affiliated group consisting only of North
American Van Lines and its Subsidiaries, or
(z) any federal, state, foreign, provincial or local withholding taxes
paid by Holding by virtue of any dividend distributions in respect of the
Preferred Stock issued in the Allied Acquisition (other than any such
dividend distributions paid in cash).
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"Representative" means the trustee, agent or representative (if any) for an
issue of Senior Indebtedness.
"Restricted Payment Transaction" means any Restricted Payment permitted
pursuant to the covenant described under "--Certain Covenants--Limitation on
Restricted Payments," any Permitted Payment, any Permitted Investment, or any
transaction specifically excluded from the definition of the term "Restricted
Payment."
"Restricted Subsidiary" means any Subsidiary of North American Van Lines
other than an Unrestricted Subsidiary.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of North American Van Lines
secured by a Lien.
"Senior Credit Agreement" means the credit agreement dated as of the Issue
Date among North American Van Lines, any Subsidiaries of North American Van
Lines party thereto from time to time, the banks and other financial
institutions party thereto from time to time, Banc of America Securities LLC, as
syndication agent, and The Chase Manhattan Bank as collateral agent and
administrative agent, as such agreement may be assumed by any successor in
interest, and as such agreement may be amended, supplemented, waived or
otherwise modified from time to time, or refunded, refinanced, restructured,
replaced, renewed, repaid, increased or extended from time to time (whether in
whole or in part, whether with the original agent and lenders or other agents
and lenders or otherwise, and whether provided under the original Senior Credit
Agreement or otherwise).
"Senior Credit Facility" means the collective reference to the Senior Credit
Agreement, any Loan Documents (as defined therein), any notes and letters of
credit issued pursuant thereto and any guarantee and collateral agreement,
patent and trademark security agreement, mortgages, letter of credit
applications and other guarantees, pledge agreements, security agreements and
collateral documents, and other instruments and documents, executed and
delivered pursuant to or in connection with any of the foregoing, in each case
as the same may be amended, supplemented, waived or otherwise modified from time
to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time (whether in whole or in part, whether
with the original agent and lenders or other agents and lenders or otherwise,
and whether provided under the original Senior Credit Agreement or one or more
other credit agreements, indentures (including the indenture) or financing
agreements or otherwise). Without limiting the generality of the foregoing, the
term "Senior Credit Facility" shall include any agreement
(1) changing the maturity of any Indebtedness incurred thereunder or
contemplated thereby,
(2) adding Subsidiaries of North American Van Lines as additional
borrowers or guarantors thereunder,
(3) increasing the amount of Indebtedness incurred thereunder or
available to be borrowed thereunder or
(4) otherwise altering the terms and conditions thereof.
"Senior Subordinated Indebtedness" means the notes and any other
Indebtedness of North American Van Lines that ranks PARI PASSU with the notes.
"Significant Domestic Subsidiary" means any Domestic Subsidiary that is a
Significant Subsidiary.
"Significant Subsidiary" means any Restricted Subsidiary that would be a
"significant subsidiary" of North American Van Lines within the meaning of
Rule 1-02 under Regulation S-X promulgated by the SEC, as in effect on the Issue
Date.
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"S&P" means Standard & Poor's Ratings Service, a division of The McGraw-Hill
Companies, Inc., and its successors.
"Standard Receivable Obligations" means representations, warranties,
covenants, indemnities and other obligations (including Guarantees and
Indebtedness) that are reasonably customary in connection with a Financing
Disposition (as determined by North American Van Lines in good faith),
including, without limitation, those relating to the servicing of the assets of
a Receivables Entity, it being understood that any Receivables Repurchase
Obligation shall be deemed to be a Standard Receivable Obligation.
"Stated Maturity" means, with respect to any security, the date specified in
such security as the fixed date on which the payment of principal of such
security is due and payable, including pursuant to any mandatory redemption
provision (but excluding any provision providing for the repurchase of such
security at the option of the holder thereof upon the happening of any
contingency).
"Subordinated Obligations" means any Indebtedness of North American Van
Lines (whether outstanding on the date of the indenture or thereafter Incurred)
that is expressly subordinated in right of payment to the notes pursuant to a
written agreement.
"Subsidiary" of any Person means any corporation, association, partnership
or other business entity of which more than 50% of the total voting power of
shares of Capital Stock or other equity interests (including partnership
interests) entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by (1) such Person or (2) one or
more Subsidiaries of such Person.
"Successor Company" shall have the meaning assigned thereto in clause (1)
under "--Merger and Consolidation."
"Tax Sharing Agreement" means the Tax Sharing Agreement, dated as of the
Issue Date, between North American Van Lines and Holding, as the same may be
amended, supplemented, waived or otherwise modified from time to time in
accordance with the terms thereof and of the indenture.
"Temporary Cash Investments" means any of the following:
(1) any investment in (X) direct obligations of the United States of
America or any agency or instrumentality thereof or obligations Guaranteed
by the United States of America or any agency or instrumentality thereof, or
(Y) direct obligations of any foreign country recognized by the United
States of America rated at least "A" by S&P or "A-1" by Moody's (or, in
either case, the equivalent of such rating by such organization or, if no
rating of S&P or Moody's then exists, the equivalent of such rating by any
nationally recognized rating organization),
(2) overnight bank deposits, and investments in time deposit accounts,
certificates of deposit, bankers' acceptances and money market deposits (or,
with respect to foreign banks, similar instruments) maturing not more than
one year after the date of acquisition thereof issued by (X) any lender
under the Senior Credit Agreement or (Y) a bank or trust company that is
organized under the laws of the United States of America, any state thereof
or any foreign country recognized by the United States of America having
capital and surplus aggregating in excess of $250 million (or the foreign
currency equivalent thereof) and whose long term debt is rated at least "A"
by S&P or "A-1" by Moody's (or, in either case, the equivalent of such
rating by such organization or, if no rating of S&P or Moody's then exists,
the equivalent of such rating by any nationally recognized rating
organization) at the time such Investment is made,
(3) repurchase obligations with a term of not more than 30 days for
underlying securities of the types described in clause (1) or (2) above
entered into with a bank meeting the qualifications described in clause (2)
above,
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(4) investments in commercial paper, maturing not more than 270 days
after the date of acquisition, issued by a Person (other than North American
Van Lines or any of its Subsidiaries), with a rating at the time as of which
any Investment therein is made of "P-2" (or higher) according to Moody's or
"A-2" (or higher) according to S&P (or, in either case, the equivalent of
such rating by such organization or, if no rating of S&P or Moody's then
exists, the equivalent of such rating by any nationally recognized rating
organization),
(5) Investments in securities maturing not more than one year after the
date of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States of America, or by any political subdivision
or taxing authority thereof, and rated at least "A" by S&P or "A" by Moody's
(or, in either case, the equivalent of such rating by such organization or,
if no rating of S&P or Moody's then exists, the equivalent of such rating by
any nationally recognized rating organization),
(6) investment funds investing 95% of their assets in securities of the
type described in clauses (1)--(5) above (which funds may also hold
reasonable amounts of cash pending investment and/or distribution),
(7) any money market deposit accounts issued or offered by a domestic
commercial bank or a commercial bank organized and located in a country
recognized by the United States of America, in each case, having capital and
surplus in excess of $250 million (or the foreign currency equivalent
thereof), or investments in money market funds complying with the risk
limiting conditions of Rule 2a-7 (or any successor rule) of the SEC under
the Investment Company Act of 1940, as amended, or
(8) similar short-term investments approved by the Board of Directors in
the ordinary course of business.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
SectionSection77aaa-7bbbb) as in effect on the date of the indenture.
"Trade Payables" means, with respect to any Person, any accounts payable or
any indebtedness or monetary obligation to trade creditors created, assumed or
guaranteed by such Person arising in the ordinary course of business in
connection with the acquisition of goods or services.
"Transactions" means, collectively, the Allied Acquisition, the offering and
issuance of the notes and the Holding Notes, the initial borrowings under the
Senior Credit Facility, the issuance by Holding of Capital Stock as part of the
consideration for the Allied Acquisition, the Holding Stock Issuance, and all
other related transactions.
"Trust Officer" means the Chairman of the Board, the President or any other
officer or assistant officer of the trustee assigned by the trustee to
administer its corporate trust matters.
"Unrestricted Subsidiary" means
(1) any Subsidiary of North American Van Lines that at the time of
determination is an Unrestricted Subsidiary, as designated by the Board of
Directors in the manner provided below, and
(2) any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors may designate any Subsidiary of North American Van Lines
(including any newly acquired or newly formed Subsidiary of North American Van
Lines) to be an Unrestricted Subsidiary unless such Subsidiary or any of its
Subsidiaries owns any Capital Stock or Indebtedness of, or owns or holds any
Lien on any property of, North American Van Lines or any other Restricted
Subsidiary of North American Van Lines that is not a Subsidiary of the
Subsidiary to be so designated; provided, that either
(A) the Subsidiary to be so designated has total consolidated assets of
$1,000 or less or
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(B) if such Subsidiary has consolidated assets greater than $1,000, then
such designation would be permitted under the covenant described under
"--Certain Covenants--Limitation on Restricted Payments."
The Board of Directors may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary; provided, that immediately after giving effect to such
designation either
(x) North American Van Lines could incur at least $1.00 of additional
Indebtedness under paragraph (a) in the covenant described under "--Certain
Covenants--Limitation on Indebtedness" or
(y) the Consolidated Coverage Ratio would be greater than it was immediately
prior to giving effect to such designation.
Any such designation by the Board of Directors shall be evidenced to the trustee
by promptly filing with the trustee a copy of the resolution of North American
Van Lines' Board of Directors giving effect to such designation and an Officer's
Certificate of North American Van Lines certifying that such designation
complied with the foregoing provisions.
"Voting Stock" of an entity means all classes of Capital Stock of such
entity then outstanding and normally entitled to vote in the election of
directors or all interests in such entity with the ability to control the
management or actions of such entity.
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CERTAIN UNITED STATES FEDERAL TAX CONSIDERATIONS
UNITED STATES FEDERAL TAX CONSIDERATIONS
The following is a summary of certain United States federal income tax
consequences of the acquisition, ownership and disposition of the notes. This
summary applies only to a beneficial owner of a note who acquired a note at the
initial offering from the initial purchasers and for the original offering price
thereof.
This summary is based on provisions of the U.S. Internal Revenue Code of
1986, as amended (the "Code"), existing and proposed U.S. Treasury regulations
promulgated thereunder (the "Treasury Regulations") and administrative and
judicial interpretations thereof, all as of the date hereof and all of which are
subject to change, possibly on a retroactive basis.
This summary does not address the tax consequences to subsequent purchasers
of the notes, and is limited to acquirors who hold the notes as capital assets.
This summary is for general information only, and does not address all of the
tax consequences that may be relevant to particular acquirors in light of their
personal circumstances, or to certain types of acquirors (such as banks and
other financial institutions, real estate investment trusts, regulated
investment companies, insurance companies, tax-exempt organizations, dealers in
securities, persons who hold the notes as part of a hedge or a straddle with
other investments). In addition, this summary does not include any description
of the tax laws of any state, local or non-U.S. government that may be
applicable to a particular acquiror.
PROSPECTIVE ACQUIRORS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS WITH
RESPECT TO THE PARTICULAR U.S. FEDERAL INCOME AND ESTATE TAX CONSEQUENCES TO
THEM OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF THE NOTES, AS WELL AS THE
TAX CONSEQUENCES UNDER STATE, LOCAL, NON-U.S. AND OTHER U.S. FEDERAL TAX LAWS
AND THE POSSIBLE EFFECTS OF CHANGES IN TAX LAWS.
EXCHANGE OFFER
The exchange of any old note for a new note should not constitute a taxable
exchange of the old note. As a result, the new notes should have the same issue
price (and adjusted issue price immediately after the exchange) and the same
amount of original issue discount, if any, as the old notes, and each holder
should have the same adjusted tax basis and holding period in the new notes as
it had in the old notes immediately before the exchange. The following
discussion assumes that the exchange of old notes for new notes pursuant to the
exchange offer will not be treated as a taxable exchange and that the old notes
and the new notes will be treated as the same security for federal income tax
purposes.
TAXATION OF U.S. HOLDERS
As used herein, the term "U.S. holder" means a holder of a note that is, for
U.S. federal income tax purposes, (a) a citizen or resident of the United
States, (b) a corporation or partnership created or organized in the United
States or under the laws of the United States or of any state of the United
States, (c) an estate whose income is includable in gross income for
U.S. federal income tax purposes regardless of its source or (d) a trust if
(1) a court within the United States is able to exercise primary supervision
over the administration of the trust and (2) at least one U.S. person has
authority to control all substantial decisions of the trust. The Code authorizes
the issuance of Treasury Regulations that, under certain circumstances, could
reclassify as a non-U.S. partnership a partnership that would otherwise be
treated as a U.S. partnership, or could reclassify as a U.S. partnership a
partnership that would otherwise be treated as a non-U.S. partnership. Such
regulations would apply only to partnerships created or organized after the date
that proposed Treasury Regulations are filed with the Federal Register (or, if
earlier, the date of issuance of a notice substantially describing the expected
contents of the regulations).
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PAYMENT OF INTEREST ON THE NOTES OTHER THAN PAYMENTS UPON REGISTRATION
DEFAULT. In general, interest paid on a note (other than payments upon a
registration default discussed below) will be taxable to a U.S. holder as
ordinary interest income, as received or accrued, in accordance with such
holder's method of accounting for federal income tax purposes. If original issue
discount on a note is not greater than a DE MINIMIS amount equal to 0.25% of its
stated principal amount multiplied by the number of complete years to its
maturity, any such discount will be deemed to be equal to zero, and a holder
will not be required to accrue a portion of such discount as income in each
taxable year. See, however, the discussion below under "--Payments upon
Registration Default." Holders should consult their tax advisors as to the
possible effect of payments upon a registration default on the treatment of
original issue discount on the note if any.
PAYMENTS UPON REGISTRATION DEFAULT. Because the notes provide for the
payment of additional interest under the circumstances described above under
"Description of Notes--Registration Rights," the notes could be subject to
certain Treasury Regulations relating to debt instruments that provide for one
or more contingent payments (the "Contingent Payment Regulations"). Under the
Contingent Payment Regulations, however a payment is not a contingent payment
merely because of a contingency that, as of the issue date, is either "remote"
or "incidental." The Company intends to take the position that, for purposes of
the Contingent Payment Regulations, the payment of such additional interest is a
remote or incidental contingency as of the issue date. Accordingly, the
Contingent Payment Regulations should not apply to the notes unless payments are
actually made upon a registration default, in which case, the rules described
below would apply to such payments.
If payments of additional interest were actually made, then such payments
would be includable in a U.S. holder's gross income in the taxable year in which
such payments were actually made, regardless of the tax accounting method used
by such holder. If payments of additional interest were actually made and such
payments were "not insignificant" under the Contingent Payment Regulations, the
notes would be treated as reissued for purposes of applying the original issue
discount rules. As a consequence of such reissuance, a U.S. holder could be
required to accrue all payments on a note in excess of its issue price
(including, possibly, amounts that would otherwise constitute DE MINIMIS
original issue discount) on a constant yield basis.
If the U.S. Internal Revenue Service (the "IRS") were to take the position
that, as of the date of issuance, the payment of such additional interest were
not a "remote" or "incidental" contingency for purposes of the Contingent
Payment Regulations, then (1) all payments (including any projected payments of
such additional interest) on a note in excess of its issue price would
effectively be treated as original issue discount, and (2) in each taxable year,
a holder would be required to include an allocable portion of such amounts in
gross income on a constant yield basis whether or not the payment of such
additional interest were fixed or determinable in the taxable year.
The Company's position for purposes of the Contingent Payment Regulations
that the payment of such additional interest is a remote contingency as of the
issue date is binding on each holder for federal income tax purposes, unless
such holder discloses in the proper manner to the IRS that it is taking a
different position.
Prospective acquirors should consult their tax advisors as to the tax
considerations relating to debt instruments providing for payments such as the
additional interest payable upon a registration default, particularly in
connection with the possible application of the Contingent Payment Regulations.
SALE, EXCHANGE OR RETIREMENT OF THE NOTES. Upon the sale, exchange,
redemption, retirement at maturity or other disposition of a note, a
U.S. holder will generally recognize taxable gain or loss equal to the
difference between the sum of the cash and the fair market value of all other
property received on such disposition (except to the extent such cash or
property is attributable to accrued interest, which will be taxable as ordinary
income) and such holder's adjusted tax basis in the note.
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Gain or loss recognized on the disposition of a note generally will be
capital gain or loss, and will be long-term capital gain or loss if, at the time
of such disposition, the holder's holding period for the note is more than one
year. A reduced tax rate on capital gain will apply to an individual
U.S. holder if such holder's holding period for the note is more than one year
at the time of disposition.
MARKET DISCOUNT. A U.S. holder (other than a holder who makes the election
described below) that acquires a note with market discount that is not de
minimis, except in certain non-recognition transactions, generally will be
required to treat any gain realized upon the disposition of the note as interest
income to the extent of the market discount that accrued during the period such
holder held such note. (For this purpose, a person disposing of a market
discount note in a transaction other than a sale, exchange or involuntary
conversion generally is treated as realizing an amount equal to the fair market
value of the note.) A holder may also be required to recognize as ordinary
income any principal payments with respect to a note to the extent such payments
do not exceed the accrued market discount on the note. For these purposes,
market discount generally equals the excess of the stated redemption price of
the note over the tax basis of the note in the hands of the holder immediately
after its acquisition. However, market discount is deemed not to exist if the
market discount is less than a de minimis amount equal to 0.25% of the note's
redemption price at maturity multiplied by the number of complete years to the
note's maturity after the holder acquired the note (or, in the case of a holder
that acquires a new note pursuant to the exchange offer, the old note exchanged
for such new note).
The market discount rules also provide that any holder of notes that were
acquired at a market discount may be required to defer the deduction of a
portion of the interest on any indebtedness incurred or maintained to acquire or
carry the notes, until the notes are disposed of.
A holder of a note acquired at a market discount may elect to include market
discount in income as the discount accrues. In such a case, the foregoing rules
with respect to the recognition of ordinary income on dispositions and with
respect to the deferral of interest deductions on indebtedness related to such
note would not apply. The current inclusion election applies to all market
discount obligations acquired on or after the first day of the first taxable
year to which the election applies, and may not be revoked without the consent
of the IRS.
AMORTIZABLE BOND PREMIUM. Generally, if the tax basis of an obligation held
as a capital asset exceeds the amount payable at maturity of the obligation,
such excess may constitute amortizable bond premium that the holder of such
obligation may elect to amortize under the constant interest rate method and
deduct over the period from the holder's acquisition date to the obligation's
maturity date. A holder that elects to amortize bond premium must reduce its tax
basis in the related obligation by the amount of the aggregate deductions
allowable for the amortizable bond premium. Any election to amortize bond
premium applies to all bonds (other than bonds the interest on which is
excludible from gross income) held by the holder at the beginning of the first
taxable year to which the election applies or thereafter acquired by the holder.
The election may not be revoked without the consent of the IRS.
In the case of an obligation, such as a note, that may be called at a
premium prior to maturity, an earlier call date is treated as its maturity date,
and the amount of bond premium is determined by treating the amount payable on
such call date as the amount payable at maturity if such a calculation produces
a smaller amortizable bond premium than any other call date or the method
described in the preceding paragraph. For purposes of amortizing bond premium,
if a holder of a note is required to amortize and deduct bond premium by
reference to a call date, the note will be treated as maturing on such date for
the amount payable, and, if not redeemed on such date, the note will be treated
as reissued on such date for the amount so payable. If a note purchased at a
premium is redeemed pursuant to a call prior to such early call date or its
maturity, a purchaser who has elected to deduct bond premium may deduct the
excess of its adjusted tax basis in the note over the amount received on
redemption (or, if greater, the amount payable on maturity) as an ordinary loss
in the taxable year of redemption.
163
<PAGE>
The amortizable bond premium deduction is treated as a reduction of interest
on the bond instead of as a deduction. The offset of amortizable bond premium
against interest income on the bond occurs when income is taxable to a holder as
received or accrued, in accordance with such holder's method of accounting for
such income.
BACKUP WITHHOLDING AND INFORMATION REPORTING. In general, a U.S. holder
will be subject to backup withholding at the rate of 31% with respect to
interest, principal and premium, if any, paid on, and the proceeds of a
disposition of, a note, unless the holder (a) is an entity that is exempt from
withholding (including corporations, tax-exempt organizations and certain
qualified nominees) and, when required, demonstrates this fact, or (b) provides
the Company with its taxpayer identification number ("TIN") (which for an
individual would be the holder's social security number), certifies under
penalties of perjury that the TIN provided to the Company is correct and that
the holder has not been notified by the IRS that it is subject to backup
withholding due to underreporting of interest or dividends, and otherwise
complies with applicable requirements of the backup withholding rules. In
addition, such payments of principal, premium and interest to U.S. holders that
are not exempt entities will generally be subject to information reporting
requirements. A U.S. holder who does not provide the Company with its correct
TIN may be subject to penalties imposed by the IRS.
The Company will report to U.S. holders and the IRS the amount of any
"reportable payments" (including any interest paid) and any amount withheld with
respect to the notes during the calendar year.
The amount of any backup withholding from a payment to a U.S. holder will be
allowed as a credit against such holder's federal income tax liability and may
entitle such holder to a refund, provided that the required information is
furnished to the IRS. Treasury Regulations, generally effective for payments
made after December 31, 2000 (the "New Withholding Regulations"), modify certain
of the certification requirements for backup withholding. It is possible that
the Company and other withholding agents may request a new withholding exemption
from holders in order to qualify for continued exemption from backup withholding
under the New Withholding Regulations.
TAXATION OF NON-U.S. HOLDERS
PAYMENT OF INTEREST ON THE NOTES. In general payments of interest received
by any holder of a note that is not a U.S. holder will not be subject to a
U.S. federal income tax (or any withholding thereof, except as described below
under "Backup Withholding and Information Reporting"), provided that (a) under
an exemption for certain portfolio interest, (1) the non-U.S. holder does not
actually or constructively own 10% or more of the total combined voting power of
all classes of stock of the Company entitled to vote, (2) the holder is not a
"controlled foreign corporation" (generally, a non-U.S. corporation controlled
by U.S. shareholders) that is related to the Company actually or constructively
through stock ownership and (3) either (x) the beneficial owner of the note,
under penalties of perjury, provides the Company or its agent with the
beneficial owner's name and address and certifies that it is not a U.S. person
on IRS Form W-8 (or a suitable substitute form) or (y) a securities clearing
organization, bank or other financial institution that holds customers'
securities in the ordinary course of its trade or business holds the note and
certifies to the Company or its agent under penalties of perjury that such a
Form W-8 (or suitable substitute form) has been received by it from the
beneficial owner or qualifying intermediary and furnishes the payor a copy
thereof, (b) the non-U.S. holder is subject to U.S. federal income tax with
respect to the note on a net basis because payments received with respect to the
note are effectively connected with the conduct of a trade or business within
the United States by the holder (in which case the holder may also be subject to
U.S. "branch profits tax") and provides the Company with a properly executed IRS
Form 4224 or a successor form, or (c) the non-U.S. holder is entitled to the
benefits of an income tax treaty under which the interest is exempt from
U.S. withholding tax and the holder or such holder's agent provides a properly
executed IRS Form 1001 or a successor form claiming the exemption. Payments of
interest not exempt from U.S. federal income tax as described above will be
subject to withholding at the rate of 30% (subject to reduction under an
applicable income tax treaty).
164
<PAGE>
Pursuant to a recent notice issued by the IRS, the New Withholding
Regulations generally will be effective with respect to payments made after
December 31, 2000, regardless of the issue date of the instrument with respect
to which such payments are made. The New Withholding Regulations generally will
not affect the certification rules described in the preceding paragraph, but
will provide alternative methods for satisfying such requirements. The New
Withholding Regulations also generally will require, in the case of notes held
by a non-U.S. partnership, that (a) the certification described in the preceding
paragraph be provided by the partners rather than the foreign partnership and
(b) the partnership provide certain information. A look-through rule will apply
in the case of tiered partnerships. In addition, the New Withholding Regulations
may require that a non-U.S. holder (including a non-U.S. partnership or a
partner thereof) obtain a taxpayer identification number and make certain
certifications if interest in respect of a note is not portfolio interest and
the non-U.S. holder wishes to claim a reduced rate of withholding under an
income tax treaty. Each non-U.S. holder should consult its own tax advisor
regarding the application of the New Withholding Regulations.
SALE, EXCHANGE OR RETIREMENT OF THE NOTES. A non-U.S. holder generally will
not be subject to U.S. federal income tax (or withholding thereof) in respect of
gain realized on the sale, exchange, redemption, retirement at maturity or other
disposition of notes, unless (a) the gain is effectively connected with the
conduct of a trade or business within the United States by the holder, or
(b) the holder is an individual who is present in the United States for a period
or periods aggregating 183 or more days in the taxable year of the disposition
and certain other conditions are met.
As described under "--Taxation of U.S. Holders--Payments upon Registration
Default," the notes provide for the payment of additional interest upon a
registration default. Non-U.S. holders should consult their tax advisors as to
the tax considerations relating to debt instruments providing for payments such
as the additional interest, in particular as to the availability of the
exemption for portfolio interest, and the ability of holders to claim the
benefits of income tax treaty exemptions from U.S. withholding tax on interest,
in respect of such additional interest.
BACKUP WITHHOLDING AND INFORMATION REPORTING. Under current Treasury
Regulations, backup withholding and certain information reporting do not apply
to payments made by the Company or a paying agent to non-U.S. holders if the
certification described under "Payment of Interest on the Notes" is received,
provided that the payor does not have actual knowledge that the holder is a
U.S. person. If any payments of principal and interest are made to the
beneficial owner of a note by or through the non-U.S. office of a non-U.S.
custodian, non-U.S. nominee or other non-U.S. agent of such beneficial owner, or
if the non-U.S. office of a non-U.S. "broker" (as defined in applicable Treasury
Regulations) pays the proceeds of the sale of a note or a coupon to the seller
thereof, backup withholding and information reporting will not apply.
Information reporting requirements (but not backup withholding) will apply,
however, to a payment by a non-U.S. office of a broker that is a U.S. person,
that derives 50% or more of its gross income for certain periods from the
conduct of a trade or business in the United States, or that is a "controlled
foreign corporation" (generally, a non-U.S. corporation controlled by
U.S. shareholders) with respect to the United States, unless the broker has
documentary evidence in its records that the holder is a non-U.S. person and
certain other conditions are met, or the holder otherwise establishes an
exemption. Payment by a U.S. office or a broker is subject to both backup
withholding at a rate of 31% and information reporting unless the holder
certifies under penalties of perjury that it is a non-U.S. person, or otherwise
establishes an exemption. A non-U.S. holder may obtain a refund or a credit
against such holder's U.S. federal income tax liability of any amounts withheld
under the backup withholding rules, provided the required information is
furnished to the IRS.
In addition, in certain circumstances, interest on a note owned by a
non-U.S. holder will be required to be reported annually on IRS Form 1042S, in
which case such form will be filed with the IRS and furnished to the holder.
165
<PAGE>
The New Withholding Regulations revise (substantially in certain respects)
the procedures that withholding agents and payees must follow to comply with, or
to establish an exemption from, these information reporting and backup
withholding provisions for payments after December 31, 2000. It is possible that
the company and other withholding agents may request a new withholding exemption
from non-U.S. holders in order to qualify for continued exemption from backup
withholding under the New Withholding Regulations. Each non-U.S. holder should
consult its own tax advisor regarding the application to such holder of the New
Withholding Regulations.
ESTATE TAX. Subject to applicable estate tax treaty regulations, notes held
at the time of death (or theretofore transferred subject to certain retained
rights or powers) by an individual who at the time of death is a non-U.S. holder
will not be included in such holder's gross estate for U.S. federal estate tax
purposes, provided that (a) the individual does not actually or constructively
own 10% of more of the total combined voting power of all classes of stock of
the Company entitled to vote and (b) the income on the notes is not effectively
connected with the conduct of a U.S. trade or business by the individual.
PLAN OF DISTRIBUTION
Each broker-dealer that receives new notes for its own account pursuant to
the exchange offer must acknowledge and represent that it will deliver a
prospectus in connection with any resale of such new notes. This prospectus, as
it may be amended or supplemented from time to time, may be used by certain
broker-dealers (as specified in the registration rights agreement) in connection
with resales of new notes received in exchange for old notes where such old
notes were acquired as a result of market-making activities or other trading
activities. We have agreed that, for a period not to exceed 90 days after the
expiration date, we will make this prospectus, as amended or supplemented
available to any such broker-dealer for use in connection with any such resale.
In addition, until , 2000, all dealers effecting transactions in the
new notes may be required to deliver a prospectus.
We will not receive any proceeds from any sale of new notes by
broker-dealers. New notes received by broker-dealers for their own account
pursuant to the exchange offer may be sold from time to time in one or more
transactions in the over-the-counter market, in negotiated transactions, through
the writing of options on the new notes or a combination of such methods of
resale, at market prices prevailing at the time of resale, at prices related to
such prevailing market prices or negotiated prices. Any such resale may be made
directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such
broker-dealer or the purchasers of any such new notes. Any broker-dealer that
resells new notes that were received by it for its own account pursuant to the
exchange offer and any broker or dealer that participates in a distribution of
such new notes may be deemed to be an "underwriter" within the meaning of the
Securities Act and any profit on any such resale of new notes and any
commissions or concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act. The letter of transmittal
states that, by acknowledging that it will deliver and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
For a period of 90 days after the expiration date, we will send additional
copies of this prospectus to certain broker-dealers (as specified in the
registration rights agreement) that request such documents in the letter of
transmittal. We have agreed to pay certain expenses incident to the exchange
offer, and will indemnify holders of the notes (including broker-dealers)
against certain liabilities, including liabilities under the Securities Act.
LEGAL MATTERS
The validity of the new notes offered hereby and the subsidiary guarantees
will be passed upon for North American Van Lines by Debevoise & Plimpton, New
York, New York, special New York counsel to North American Van Lines. Franci J.
Blassberg, Esq., a member of Debevoise & Plimpton, is married to
166
<PAGE>
Joseph L. Rice III, who is a shareholder of the managing general partner of the
general partner of Clayton, Dubilier & Rice Fund V Limited Partnership.
EXPERTS
The financial statements of North American Van Lines as of December 26, 1998
and March 28, 1998 and for the nine-month period ended December 26, 1998 and the
three-month period ended March 28, 1998 included in this prospectus have been
audited by PricewaterhouseCoopers LLP, independent auditors, as stated in their
reports herein, and are included in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing. With respect to the
unaudited condensed interim consolidated financial statements of North American
Van Lines as of September 25, 1999 and for the nine-month period ended
September 25, 1999 included in this prospectus, PricewaterhouseCoopers LLP have
reported that they have applied limited procedures in accordance with
professional standards for a review of such information. However, their separate
report appearing herein states that they did not audit and they do not express
an opinion on these interim financial statements. Accordingly, the degree of
reliance on their report on these financial statements should be restricted
considering the limited nature of the review procedures applied. The financial
statements of North American Van Lines' predecessor as of and for the years
ended December 27, 1997 and December 28, 1996 included in this prospectus have
been audited by KPMG LLP, independent auditors, as stated in their report
herein, and are included in reliance upon the report of such firm given upon
their authority as experts in accounting and auditing.
The combined financial statements of NFC Moving Services Group as of
September 30, 1998 and 1997 and for each of the three years in the period ended
September 30, 1998, included in this prospectus have been audited by Ernst &
Young, independent auditors, as set forth in their report appearing herein, and
are included in reliance upon such report given upon the authority of such firm
as experts in accounting and auditing.
With respect to the unaudited condensed combined interim financial
information of NFC Moving Services Group for the nine-month periods ended
June 30, 1999 and 1998, included in this prospectus, Ernst & Young have reported
that they have applied limited procedures in accordance with professional
standards for a review of such information. However, their separate report
appearing herein states that they did not audit and they do not express an
opinion on that interim financial information. Accordingly, the degree of
reliance on their reports on such information should be restricted considering
the limited nature of the review procedures applied.
The independent auditors are not subject to the liability provisions of
Section 11 of the Securities Act for their reports on the unaudited interim
financial information because such reports are not a "report" or a "part" of the
registration statement prepared or certified by the auditors within the meaning
of Sections 7 and 11 of the Securities Act.
167
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
Upon effectiveness of the registration statement of which this prospectus is
a part, we will file annual and quarterly and other information with the
Securities and Exchange Commission (the "Commission"). You may read and copy any
reports, statements and other information we file at the Commission's public
reference rooms in Washington, D.C., New York, New York, and Chicago, Illinois.
Please call 1-800-SEC-0330 for further information on the public reference
rooms. Our filings will also be available to the public from commercial document
retrieval services and at the web site maintained by the Commission at
http://www.sec.gov.
We have filed a registration statement on Form S-4 to register with the
Commission the new notes to be issued in exchange for the old notes. This
prospectus is part of that registration statement. As allowed by the
Commission's rules, this prospectus does not contain all of the information you
can find in the registration statement or the exhibits to the registration
statement.
168
<PAGE>
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
NORTH AMERICAN VAN LINES, INC. CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS (UNAUDITED):
Report of Independent Accountants......................... F-3
Condensed Consolidated Balance Sheets at September 25,
1999 and December 26, 1998 (unaudited).................. F-4
Condensed Consolidated Statements of Income for the
periods December 27, 1998 through September 25, 1999,
June 27, 1999 through September 25, 1999, June 28, 1998
through September 26, 1998, March 29, 1998 through
September 26, 1998 and December 28, 1997 through
March 28, 1998 (Predecessor) (unaudited)................ F-5
Condensed Consolidated Statement of Changes in
Stockholders' Equity for the period December 26, 1998
through September 25, 1999 (unaudited).................. F-6
Condensed Consolidated Statements of Cash Flows for the
periods December 27, 1998 through September 25, 1999,
March 29, 1998 through September 26, 1998 and
December 28, 1997 through March 28, 1998
(Predecessor)(unaudited)................................ F-7
Notes to Condensed Consolidated Financial Statements
(unaudited)............................................. F-8
NORTH AMERICAN VAN LINES, INC. CONSOLIDATED FINANCIAL
STATEMENTS:
Report of Independent Accountants......................... F-15
Consolidated Balance Sheets at December 26, 1998 and
March 29, 1998.......................................... F-16
Consolidated Statement of Income for the period March 29,
1998 (inception) through December 26, 1998.............. F-18
Consolidated Statement of Changes in Stockholders' Equity
for the period March 29, 1998 (inception) through
December 26, 1998....................................... F-19
Consolidated Statement of Cash Flows for the period
March 29, 1998 (inception) through December 26, 1998.... F-20
Notes to Consolidated Financial Statements................ F-21
NORTH AMERICAN VAN LINES, INC. CONSOLIDATED FINANCIAL
STATEMENTS:
Report of Independent Accountants......................... F-40
Consolidated Balance Sheet at March 28, 1998.............. F-41
Consolidated Statement of Income for the period
December 28, 1997 through March 28, 1998................ F-43
Consolidated Statement of Changes in Stockholders' Equity
for the period December 28, 1997 through March 28,
1998.................................................... F-44
Consolidated Statement of Cash Flows for the period
December 28, 1997 through March 28, 1998................ F-45
Notes to Consolidated Financial Statements................ F-46
NORTH AMERICAN VAN LINES, INC. CONSOLIDATED FINANCIAL
STATEMENTS:
Independent Auditors' Report.............................. F-63
Consolidated Balance Sheets, December 27, 1997 and
December 28, 1996....................................... F-64
Consolidated Statements of Income and Retained Income,
years ended December 27, 1997 and December 28, 1996..... F-66
Consolidated Statements of Cash Flows, years ended
December 27, 1997 and December 28, 1996................. F-68
Notes to Consolidated Financial Statements................ F-69
NFC MOVING SERVICES GROUP CONDENSED COMBINED FINANCIAL
STATEMENTS (UNAUDITED):
Review Report of Independent Auditors..................... F-88
Condensed combined balance sheets at June 30, 1998 and
1999.................................................... F-89
</TABLE>
F-1
<PAGE>
<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Condensed combined profit and loss accounts for the nine
months ended June 30, 1998 and 1999..................... F-90
Condensed combined statements of total recognized gains
and losses for the nine months ended June 30, 1998 and
1999.................................................... F-91
Condensed combined cash flow statements for the nine
months ended June 30, 1998 and 1999..................... F-92
Condensed combined statements of changes in NFC Group
investment for the nine months ended June 30, 1998 and
1999.................................................... F-93
Notes to the condensed combined financial statements...... F-94
NFC MOVING SERVICES GROUP COMBINED FINANCIAL STATEMENTS:
Report of Independent Auditors............................ F-97
Combined balance sheets at September 30, 1997 and 1998.... F-98
Combined profit and loss accounts for the years ended
September 30, 1996, 1997 and 1998....................... F-99
Combined statements of total recognized gains and losses
for the years ended September 30, 1996, 1997 and
1998.................................................... F-100
Combined cash flow statements for the years ended
September 30, 1996, 1997 and 1998....................... F-101
Combined statements of changes in NFC Group investment for
the years ended September 30, 1996, 1997 and 1998....... F-102
Notes to the combined financial statements................ F-103
</TABLE>
F-2
<PAGE>
[LOGO]
- --------------------------------------------------------------------------------
PRICEWATERHOUSECOOPERS
LLP
200 East Randolph Drive
Chicago IL 60601
Telephone (312) 540 1500
REPORT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
NA Holding Corporation:
We have reviewed the accompanying condensed consolidated balance sheet of North
American Van Lines, Inc. and its subsidiaries (the "Company") as of
September 25, 1999, and the related condensed consolidated statements of income
for the periods June 27, 1999 through September 25, 1999 and December 27, 1998
through September 25, 1999, the condensed consolidated statement of
shareholders' equity for the period December 27, 1998 through September 25, 1999
and the condensed consolidated statement of cash flows for the period
December 27, 1998 through September 25, 1999. These financial statements are the
responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying condensed consolidated interim financial statements
for them to be in conformity with generally accepted accounting principles.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
November 12, 1999, except as to Note 6 and Note 8,
for which the date is January 31, 2000
F-3
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
AT SEPTEMBER 25, 1999 AND DECEMBER 26, 1998
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
SEPTEMBER 25, DECEMBER 26,
1999 1998
------------- ------------
<S> <C> <C>
Current assets:
Cash and cash equivalents................................. $ 1,228 $ 2,074
Accounts and notes receivable, net of allowance for
doubtful accounts of $3,998 and $1,128 respectively..... 168,870 137,925
Deferred and recoverable income taxes..................... 17,785 15,127
Other current assets...................................... 29,081 25,167
-------- --------
Total current assets........................................ 216,964 180,293
-------- --------
Property and equipment...................................... 93,812 91,795
Less accumulated depreciation............................. (34,725) (18,194)
-------- --------
59,087 73,601
Intangible assets........................................... 93,408 97,450
Other assets................................................ 43,419 40,719
-------- --------
Total assets................................................ $412,878 $392,063
======== ========
Current liabilities:
Current portion of long-term debt and lease obligation.... $ 5,475 $ 3,599
Revolving credit facility and notes payable............... 37,337 25,000
Accounts payable.......................................... 44,490 35,078
Accrued transportation expense............................ 32,301 22,224
Other current liabilities................................. 68,854 62,987
-------- --------
Total current liabilities................................... 188,457 148,888
-------- --------
Long-term debt and lease obligation......................... 135,447 140,021
Deferred income taxes....................................... 4,281 5,352
Other liabilities........................................... 27,858 34,152
-------- --------
Total liabilities........................................... 356,043 328,413
-------- --------
Stockholders' equity:
Common stock, $.01 par value, 1,000 authorized, issued and
outstanding, respectively............................... -- --
Additional paid-in-capital................................ 65,000 65,000
Retained earnings (deficit)............................... (8,143) (1,212)
Accumulated other comprehensive income (loss)............. (22) (138)
-------- --------
Total stockholders' equity................................ 56,835 63,650
-------- --------
Total liabilities and stockholders' equity.................. $412,878 $392,063
======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
F-4
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE PERIODS DECEMBER 27, 1998 THROUGH SEPTEMBER 25, 1999, JUNE 27, 1999
THROUGH
SEPTEMBER 25, 1999, JUNE 28, 1998 THROUGH SEPTEMBER 26, 1998, MARCH 29, 1998
THROUGH
SEPTEMBER 26, 1998, AND DECEMBER 28, 1997 THROUGH MARCH 28, 1998 (PREDECESSOR)
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
COMPANY PREDECESSOR
------------------------------------------------- -----------
NINE THREE THREE THREE
MONTHS MONTHS MONTHS SIX MONTHS MONTHS
ENDED ENDED ENDED ENDED ENDED
SEPT. 25, SEPT. 25, SEPT. 26, SEPT. 26, MARCH 28,
1999 1999 1998 1998 1998
---------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Operating revenues................. $771,237 $311,135 $285,083 $520,988 $207,245
Operating expenses:
Transportation................... 607,608 247,638 223,795 407,115 162,381
Administration................... 102,255 32,031 30,597 62,053 34,240
Insurance and claims............. 23,998 9,587 9,920 18,412 6,538
Depreciation..................... 17,404 5,878 6,335 12,547 2,256
Amortization..................... 3,679 1,242 1,285 2,610 639
Maintenance, tires, and other
operating...................... 16,410 5,745 5,989 11,122 4,302
Equipment sales and services,
net............................ (2,984) (1,061) (1,010) (2,496) (977)
Insurance and supply programs,
net............................ (2,431) (515) (602) (1,385) (799)
Restructuring.................... 2,400 2,400 -- -- --
-------- -------- -------- -------- --------
Total operating expenses....... 768,339 302,945 276,309 509,978 208,580
-------- -------- -------- -------- --------
(Loss)/income from
operations................... 2,898 8,190 8,774 11,010 (1,335)
Non-operating (expense)/income..... (7) 135 109 139 10
Minority interest.................. (179) (33) (32) (9) (13)
-------- -------- -------- -------- --------
(Loss)/income before interest
and taxes.................... 2,712 8,292 8,851 11,140 (1,338)
Interest expense................... 12,395 4,311 4,152 8,089 (240)
-------- -------- -------- -------- --------
(Loss)/income before income
taxes........................ (9,683) 3,981 4,699 3,051 (1,098)
Provision for income taxes......... (2,752) 2,223 2,895 2,386 (448)
-------- -------- -------- -------- --------
Net (loss)/income.............. $ (6,931) $ 1,758 $ 1,804 $ 665 $ (650)
======== ======== ======== ======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
F-5
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD DECEMBER 26, 1998 THROUGH SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
ACCUMULATED
RETAINED OTHER ADDITIONAL
COMPREHENSIVE EARNINGS COMPREHENSIVE COMMON PAID IN
TOTAL INCOME (LOSS) (DEFICIT) INCOME (LOSS) STOCK CAPITAL
-------- ------------- --------- ------------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Balance at December 26,
1998........................ $63,650 $(1,212) $(138) $0 $65,000
Comprehensive income (loss)
Net income (loss)........... (6,931) $(6,931) (6,931)
-------
Gross unrealized holding
gains..................... 138 138
Foreign currency
translation............... (22) (22)
-------
Other comprehensive income
(loss).................... 116 116
-------
Comprehensive income (loss)... $(6,815)
------- ======= ------- ----- -- -------
Balance at September 25,
1999........................ $56,835 $(8,143) $ (22) $0 $65,000
======= ======= ===== == =======
</TABLE>
See accompanying notes to condensed consolidated financial statements.
F-6
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE PERIODS DECEMBER 27, 1998 THROUGH SEPTEMBER 25, 1999, MARCH 29, 1998
THROUGH
SEPTEMBER 26, 1998 AND DECEMBER 28, 1997 THROUGH MARCH 28, 1998 (PREDECESSOR)
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
COMPANY PREDECESSOR
-------------------------------- ---------------
NINE MONTHS SIX MONTHS THREE MONTHS
ENDED ENDED ENDED
SEPT. 25, 1999 SEPT.26, 1998 MARCH 28, 1998
--------------- -------------- ---------------
<S> <C> <C> <C>
Net cash (used for) provided by operating
activities.............................. $ (1,559) $(12,178) $10,295
--------- -------- -------
Cash flows from investing activities:
Additions of property and equipment..... (5,473) (4,062) (1,402)
Proceeds from sale of property and
equipment............................. 3,216 464 162
Other investing activities.............. (1,302) (714) (2,166)
--------- -------- -------
Net cash used for investing activities.... (3,559) (4,312) (3,406)
--------- -------- -------
Cash flows from financing activities:
Collection of intercompany balance with
NS.................................... -- -- 10,204
Borrowings on revolving credit facility
and notes payable..................... 140,686 63,821 244
Repayment of revolving credit facility
and notes payable..................... (128,349) (38,532) (844)
Change in balance of outstanding
checks................................ 1,726 225 (1,598)
Payment for sale of insurance
liabilities........................... (7,271) (13,500) --
Common dividends paid................... -- -- (6,464)
Other financing activities.............. (2,520) (1,032) (7)
--------- -------- -------
Net cash provided by financing
activities.............................. 4,272 10,982 1,535
--------- -------- -------
Net cash flows from continuing
operations.............................. (846) (5,508) 8,424
Net cash flows from the payment or
transfer of liabilities attributable to
discontinued operations................. -- -- (2,145)
--------- -------- -------
Net increase in cash and cash
equivalents............................. (846) (5,508) 6,279
Cash and cash equivalents at beginning of
period.................................. 2,074 9,227 2,948
--------- -------- -------
Cash and cash equivalents at end of
period.................................. $ 1,228 $ 3,719 $ 9,227
========= ======== =======
Supplemental disclosure of cash flow
information--cash paid
Interest................................ $ 9,141 $ 4,485 $ 140
Income taxes............................ $ 1,427 $ 5,515 $ 225
========= ======== =======
</TABLE>
See accompanying notes to condensed consolidated financial statements.
F-7
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
(1) BASIS OF PRESENTATION
This report covers North American Van Lines, Inc. and its subsidiaries
(collectively, "NAVL" or the "Company").
The accompanying unaudited condensed consolidated financial statements
should be read together with the Company's audited consolidated financial
statements for the periods December 28, 1997 through March 28, 1998
(Predecessor) and the Company's parent's (NA Holding Corporation's) audited
consolidated financial statements for the period March 29, 1998 through
December 26, 1998. Certain information and footnote disclosures normally
included in aforementioned financial statements prepared in accordance with
generally accepted accounting principles are condensed or omitted. Management of
the Company believes the interim financial statements include all adjustments,
including normal recurring adjustments, necessary for a fair presentation of the
financial condition and results of operations for the interim periods presented.
On March 29, 1998, NA Acquisition Corporation, a wholly-owned subsidiary of
NA Holding Corporation ("NA Holding"), agreed to acquire all of the capital
stock of North American Van Lines, Inc. from Norfolk Southern Corporation and
J.P. Morgan Venture Corporation (the "Predecessor"). NA Acquisition and NA
Holding were formed by Clayton, Dubilier and Rice Fund V Limited Partnership
("Fund V"), a private investment fund that is managed by Clayton, Dubilier and
Rice, Inc. Prior to the acquisition, the Predecessor recognized estimated
revenue and related transportation expense on the date a shipment was picked up
from the customer. Subsequent to the acquisition, the Company recognizes
estimated revenue and related transportation expenses on the date a shipment is
delivered or services are completed.
(2) OPERATING SEGMENTS
The Company has two reportable segments--Van Line Network and Logistics
Services.
The Van Line Network segment provides domestic and international residential
relocation services through a network of exclusive agents. It is comprised of
the Relocation Services Division, which provides packing, loading,
transportation, delivery and warehousing services for any type of household move
in the U.S. and Canada, and the International Division, which provides or
coordinates these same services for customers on a global basis.
The Logistics Services segment provides customized logistics solutions,
specialized transportation services, warehousing, distribution, and delivery
services to commercial customers. It is comprised of the Logistics Division,
which provides these specialized services to principally electronics, medical
equipment and other suppliers of sensitive goods requiring specialized handling
in the U.S., the Blanket Wrap/Flatbed Division, which provides transportation of
truckload freight requiring specialized handling in the U.S., and the Europe
Division, which provides these same logistics services in Europe and the U.K.
The accounting policies of the segments are the same as those described in
the footnotes to the aforementioned Consolidated Statements. Segment income from
operations is based on earnings before non-operating income or expense, minority
interest, interest and taxes.
F-8
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
(2) OPERATING SEGMENTS (CONTINUED)
The following information about the segments is for the periods
December 27, 1998 through September 25, 1999, June 27, 1999 through
September 25, 1999, June 28, 1998 through September 26, 1998, March 29, 1998
through September 26, 1998, and December 28, 1997 through March 28, 1998
(Predecessor).
<TABLE>
<CAPTION>
COMPANY PREDECESSOR
------------------------------------------------------ ------------
NINE MONTHS THREE MONTHS THREE MONTHS SIX MONTHS THREE MONTHS
ENDED, ENDED, ENDED, ENDED, ENDED,
SEPT. 25, SEPT. 25, SEPT. 26, SEPT. 26, MARCH 28,
1999 1999 1998 1998 1998
----------- ------------ ------------ ---------- ------------
<S> <C> <C> <C> <C> <C>
Revenues
Van Line Network............... $398,513 $182,167 $169,710 $293,125 $ 99,687
Logistics Services............. 372,724 128,968 115,373 227,863 107,558
-------- -------- -------- -------- --------
Consolidated revenues............ $771,237 $311,135 $285,083 $520,988 $207,245
======== ======== ======== ======== ========
Income (loss) from operations
Van Line Network............... $ 2,073 $ 6,774 $ 7,053 $ 7,142 $ (2,656)
Logistics Services............. 825 1,416 1,721 3,868 1,321
-------- -------- -------- -------- --------
Consolidated income (loss) from
operations..................... $ 2,898 $ 8,190 $ 8,774 $ 11,010 $ (1,335)
======== ======== ======== ======== ========
</TABLE>
<TABLE>
<CAPTION>
SEPT. 25, DEC. 26,
1999 1998
--------- --------
<S> <C> <C>
Total assets
Van Line Network...................................... $118,228 $ 94,595
Logistics Services.................................... 113,327 110,876
Corporate............................................. 181,323 186,592
-------- --------
Consolidated total assets............................... $412,878 $392,063
======== ========
</TABLE>
(3) INTANGIBLE ASSETS
Intangible assets included the following:
<TABLE>
<CAPTION>
SEPT. 25, DEC. 26,
1999 1998
--------- --------
<S> <C> <C>
Trade names........................................... $75,700 $75,700
Goodwill.............................................. 22,212 23,612
Accumulated amortization.............................. (4,504) (1,862)
------- -------
$93,408 $97,450
======= =======
</TABLE>
F-9
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
(4) LONG-TERM DEBT AND LEASE OBLIGATION
<TABLE>
<CAPTION>
SEPT. 25, DEC. 26,
1999 1998
--------- --------
<S> <C> <C>
Note payable--Tranche A interest at 90 day LIBOR rate plus
2.5% with interest and principle paid quarterly........... $ 42,125 $ 44,000
Note payable--Tranche B interest at 90 day LIBOR rate plus
2.75% with interest and principle paid quarterly.......... 98,250 99,000
Other....................................................... 547 620
-------- --------
Total long-term debt and capital lease obligation........... $140,922 $143,620
Less current maturities..................................... 5,475 3,599
-------- --------
$135,447 $140,021
======== ========
</TABLE>
The Credit Agreement contains various loan covenants including an interest
coverage ratio and a senior debt ratio. The Credit Agreement also includes a
general lien on certain NAVL assets.
The Company has available unused lines of credit of $49,334 and $61,616 at
September 25, 1999 and December 26, 1998, respectively. The fair value of the
Company's long-term debt approximates the carrying amount based on the present
value of cash flows discounted at the current rates offered to the Company on
similar debt instruments.
(5) COMMITMENTS AND CONTINGENCIES
(a) LETTERS OF CREDIT AND DEBT GUARANTEES
The Company's German subsidiary, midiData, has guarantees to WTB Leasing
GmbH and CommerzLease for equipment leases. These leases extend through the year
2003. The Company's United Kingdom subsidiary, North American Van Lines, Ltd.,
has guarantees to various parties for customs and excise taxes.
(b) LAWSUITS
The Company and certain subsidiaries are defendants in numerous lawsuits
relating principally to motor carrier operations. While the final outcome of
these lawsuits cannot be predicted with certainty, it is the opinion of
management, after consulting with its legal counsel, that the amount of NAVL 's
ultimate liability will not materially affect NAVL's consolidated financial
position, results of operations or liquidity.
(c) ENVIRONMENTAL MATTERS
The Company has been named as a potentially responsible party (PRP) in two
environmental cleanup proceedings by federal or state authorities and one
additional environmental clean-up proceeding by a group of PRP's. The suits are
brought under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, or other federal or state statutes. Based on
all known information, it is estimated that the settlement cost of each PRP site
would not be materially or significantly larger than
F-10
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
(5) COMMITMENTS AND CONTINGENCIES (CONTINUED)
the litigation reserves established, which totaled $35 on September 25, 1999 and
December 26, 1998. It is possible that additional claims or lawsuits involving
unknown environmental matters or now unidentified environmental sites may arise
in the future. The Company owns or has owned and leases or has leased facilities
at which underground storage tanks for diesel fuel are located and operated.
Management believes that the Company has taken the appropriate and necessary
action with regard to releases of diesel fuel that have occurred. As conditions
may exist on these properties related to environmental problems that are latent
or undisclosed, there can be no assurance that the Company will not incur
liabilities or costs, the amount and materiality of which cannot be estimated
reliably at this time. However, based on its assessment of the facts and
circumstances now known and after consulting with its legal counsel, management
believes that it has recorded appropriate estimates of liability for those
environmental matters of which the Company is aware. Further, management
believes it is unlikely that any identified matters, either individually or in
aggregate, will have a material adverse effect on the Company's financial
position, results of operations or liquidity.
(d) PURCHASE COMMITMENTS
The Company has entered into certain purchase commitments for trailers and
software licenses in the amount of $778 and $2,984 as of September 25, 1999 and
December 26, 1998, respectively.
(6) SUBSEQUENT EVENT
On September 14, 1999, the Company signed an acquisition agreement to
acquire substantially all of the assets of certain subsidiaries of NFC, plc.
(the "Seller") that are engaged in the Seller's moving services business. The
acquisition closed on November 19, 1999 and the transaction was accounted for as
a purchase. Total purchase consideration was $400 million cash plus a
combination of preferred stock, common stock and common stock warrants with a
combined value of $50 million.
The acquisition was funded through borrowings under new credit facilities of
$390.0 million, proceeds from the issuance of $150.0 million of NAVL senior
subordinated notes, and an increase to stockholders' equity resulting from
issuance of $24.5 million of junior preferred stock, $35.0 million of senior
discounted notes, and a common stock warrant totaling $65.5 million by NAVL's
parent, NA Holding. Of the $65.5 million, $40.0 million was initially in the
form of an interim loan facility made available to NA Holding. On December 1,
1999, Fund V and the Seller subscribed for and purchased additional shares of
common stock of NA Holding for $32.0 million and $8.0 million in cash,
respectively. The proceeds from this stock subscription were used to repay the
$40.0 million interim loan.
(7) RESTRUCTURING
In January 1999 the Company initiated the Fast Forward Program with a
detailed evaluation of its existing cost structure by NAVL employees and outside
consultants. The program is a comprehensive review of a number of initiatives
but primarily will result in reduced headcount. The Company began implementing
these initiatives during the third quarter of 1999 and recorded a charge of
$2,400. This charge includes the estimated severance related costs for 237
employees across all operating divisions of
F-11
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
(7) RESTRUCTURING (CONTINUED)
the Company and other exit costs for outplacement services, building lease
terminations and losses on the sale of equipment. As of September 25, 1999, 107
employees have been terminated and $552 of severance and other restructuring
related costs had been charged to the reserve.
The following table provides details of the restructuring accrual and
payments to date:
<TABLE>
<CAPTION>
PAYMENTS RESTRUCTURING
INITIAL AS OF ACCRUAL AS OF
RESTRUCTURING SEPTEMBER 25, SEPTEMBER 25,
CHARGE 1999 1999
------------- ------------- -------------
<S> <C> <C> <C>
Severance cost......................... $1,808 $531 $1,277
Outplacement services.................. 318 21 297
Building lease termination cost........ 246 -- 246
Loss on sale of equipment.............. 28 -- 28
------ ---- ------
Total restructuring cost............... $2,400 $552 $1,848
====== ==== ======
</TABLE>
(8) SUPPLEMENTAL INFORMATION
The following summarized consolidating balance sheet, statement of income,
and statement of cash flows have been presented in contemplation of the
transaction between NA Holding and a third party, as described in Note 6. Such
financial statements have been segregated between those entities that have
guaranteed the NAVL senior subordinated notes issued in connection with the
transaction ("Guarantor" entities), and those entities that did not guarantee
such debt ("Non-Guarantor" entities).
Consolidating balance sheet data as of September 25, 1999 is summarized as
follows:
<TABLE>
<CAPTION>
(1) (2) NON- TOTAL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Current assets........................ $178,702 $ 9,413 $ 29,184 $ (335) $216,964
Non-current assets.................... 220,507 12,440 102,642 (139,675) 195,914
-------- ------- -------- --------- --------
Total assets.......................... $399,209 $21,853 $131,826 $(140,010) $412,878
======== ======= ======== ========= ========
Current liabilities................... $152,867 $ 6,370 $ 29,555 $ (335) $188,457
Non-current liabilities............... 189,507 1,262 7,673 (30,856) 167,586
-------- ------- -------- --------- --------
Total liabilities..................... 342,374 7,632 37,228 (31,191) 356,043
Stockholders' equity.................. 56,835 14,221 94,598 (108,819) 56,835
-------- ------- -------- --------- --------
Total liabilities and equity.......... $399,209 $21,853 $131,826 $(140,010) $412,878
======== ======= ======== ========= ========
</TABLE>
F-12
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
(8) SUPPLEMENTAL INFORMATION (CONTINUED)
Consolidating statement of income data for the period December 27, 1998
through September 25, 1999 is summarized as follows:
<TABLE>
<CAPTION>
(1) (2) NON- TOTAL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Operating revenues.................... $654,943 $45,206 $ 78,730 $ (7,642) $771,237
Total operating expenses.............. 656,034 41,920 77,131 (6,746) 768,339
-------- ------- -------- --------- --------
Income (loss) from operations......... (1,091) 3,286 1,599 (896) 2,898
Interest expense and other............ 8,592 98 928 2,963 12,581
-------- ------- -------- --------- --------
Income (loss) before income taxes..... (9,683) 3,188 671 (3,859) (9,683)
Provision/(benefit) for income
taxes............................... (2,752) 905 190 (1,095) (2,752)
-------- ------- -------- --------- --------
Net income (loss)..................... $ (6,931) $ 2,283 $ 481 $ (2,764) $ (6,931)
======== ======= ======== ========= ========
</TABLE>
Income taxes have been calculated for purposes of this footnote based on an
assumed consolidated effective rate of 28.4%.
Consolidating statement of cash flows data for the period December 27, 1998
through September 25, 1999 is summarized as follows:
<TABLE>
<CAPTION>
(1) (2) NON- TOTAL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Net cash provided by (used in)
operating activities................ $ 166 $ (46) $ (1,679) $ -- $ (1,559)
Net cash used in investing
activities.......................... (3,312) -- (247) -- (3,559)
Net cash provided by financing
activities.......................... 3,404 32 836 -- 4,272
Net increase (decrease) in cash and
cash equivalents.................... 258 (14) (1,090) -- (846)
Cash at beginning of period........... 311 95 1,668 -- 2,074
-------- ------- -------- --------- --------
Cash at end of period................. $ 569 $ 81 $ 578 $ -- $ 1,228
======== ======= ======== ========= ========
</TABLE>
- ------------------------
(1) Parent includes the accounts of North American Van Lines, Inc., a Delaware
corporation and the issuer of the debt in connection with the transaction.
(2) Total Guarantors include the accounts of the following subsidiaries of North
American Van Lines, Inc.: Fleet Insurance Management, Inc., an Indiana
corporation; FrontRunner Worldwide, Inc., a Delaware corporation; NACAL,
Inc., a California corporation; NAVTRANS International Freight
F-13
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 25, 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
(8) SUPPLEMENTAL INFORMATION (CONTINUED)
Forwarding, Inc., an Indiana corporation; North American Distribution
Systems, Inc., an Indiana corporation; North American Logistics, Ltd., an
Indiana corporation, North American Van Lines of Texas, Inc., a Texas
corporation; Relocation Management Systems, Inc., a Delaware corporation;
and Great Falls North American, Inc., a Montana corporation. Each Guarantor
is a wholly owned subsidiary of North American Van Lines, Inc. and will
jointly and severally, irrevocably and fully and unconditionally guarantee
the punctual payment of such debt issued in connection with the transaction.
F-14
<PAGE>
[LOGO]
- --------------------------------------------------------------------------------
PRICEWATERHOUSECOOPERS
LLP
200 East Randolph Drive
Chicago IL 60601
Telephone (312) 540 1500
REPORT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
NA Holding Corporation
In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of income, stockholders' equity, and cash flows present
fairly, in all material respects, the financial position of North American Van
Lines, Inc. and its subsidiaries (the "Company") at December 26, 1998 and
March 29, 1998, and the results of their operations and cash flows for the
period March 29, 1998 (inception) through December 26, 1998, in conformity with
generally accepted accounting principles. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
/s/ PricewaterhouseCoopers LLP
February 3, 1999, except as to Note 17,
for which the date is September 27, 1999,
and Note 18 for which the date is January 31, 2000
F-15
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONSOLIDATED BALANCE SHEETS
AT DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
DECEMBER 26, 1998 MARCH 29, 1998
----------------- --------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 2,074 $ 9,227
Short-term investments.................................... 2,057 1,861
Accounts and notes receivable, net of allowance for
doubtful accounts of $1,128 and $0 respectively......... 137,925 123,727
Current portion of contract receivables, net of valuation
allowance of $25 and $0 respectively.................... 7,525 5,982
Supplies inventory........................................ 1,489 1,674
Equipment held for sale................................... 3,693 3,223
Current portion of deferred agent contract costs.......... 587 261
Prepaid expenses and other current assets................. 9,816 10,891
Deferred income taxes..................................... 15,127 12,157
-------- --------
Total current assets........................................ 180,293 169,003
-------- --------
Long-term portion of contract receivables................... 13,120 10,427
Long-term portion of notes receivable....................... 1,794 2,482
Investments................................................. 1,097 1,061
Property and equipment:
Land...................................................... 1,584 1,612
Buildings................................................. 16,760 16,818
Trailers.................................................. 26,676 27,049
Other equipment........................................... 46,775 42,025
-------- --------
91,795 87,504
Less accumulated depreciation............................. (18,194) --
-------- --------
73,601 87,504
Deferred agent contract costs............................... 14,233 14,995
Intangible assets........................................... 97,450 99,312
Other assets................................................ 10,475 8,323
-------- --------
Total assets................................................ $392,063 $393,107
======== ========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-16
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONSOLIDATED BALANCE SHEETS
AT DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
DECEMBER 26, 1998 MARCH 29, 1998
----------------- --------------
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt and lease obligation.... $ 3,599 $ 2,958
Revolving credit facility and notes payable............... 25,000 125
Accounts payable.......................................... 25,177 21,136
Outstanding checks........................................ 9,901 11,106
Accrued transportation expense............................ 22,224 19,696
Other current liabilities................................. 24,171 28,973
Insurance reserves and accruals........................... 20,441 39,693
Compensation and benefits................................. 14,027 14,318
Income taxes.............................................. 4,348 4,077
-------- --------
Total current liabilities................................... 148,888 142,082
-------- --------
Long-term debt and lease obligation......................... 140,021 142,645
Insurance reserves and accruals............................. 14,312 14,152
Compensation and benefits................................... 19,531 18,380
Deferred income taxes....................................... 5,352 10,597
Minority interest........................................... 309 251
-------- --------
Total liabilities........................................... 328,413 328,107
-------- --------
Stockholders' equity:
Common stock, $.01 par value, 1,000 shares authorized,
issued and outstanding at December 26, 1998 and at March
29, 1998................................................ -- --
Additional paid-in-capital................................ 65,000 65,000
Retained earnings (deficit)............................... (1,212) --
Accumulated other comprehensive income (loss)............. (138) --
-------- --------
Total stockholders' equity.................................. 63,650 65,000
-------- --------
Total liabilities and stockholders' equity.................. $392,063 $393,107
======== ========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-17
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONSOLIDATED STATEMENT OF INCOME
FOR THE PERIOD MARCH 29, 1998 (INCEPTION) THROUGH DECEMBER 26, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<S> <C>
Operating revenues.......................................... $759,207
Operating expenses:
Transportation............................................ 593,979
Administration............................................ 95,389
Insurance and claims...................................... 25,150
Depreciation.............................................. 18,763
Amortization.............................................. 3,748
Maintenance, tires and other operating.................... 16,483
Equipment sales and services, net......................... (3,694)
Insurance and supply programs, net........................ (2,178)
--------
Total operating expenses................................ 747,640
--------
Income from operations.................................. 11,567
Non-operating income........................................ 147
Minority interest........................................... (57)
--------
Income before interest and taxes........................ 11,657
Interest expense............................................ 11,758
--------
Loss before income taxes................................ (101)
Provision for income taxes.................................. 1,111
--------
Net loss................................................ $ (1,212)
========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-18
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD MARCH 29, 1998 (INCEPTION) THROUGH DECEMBER 26, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
ACCUMULATED
RETAINED OTHER ADDITIONAL
COMPREHENSIVE EARNINGS COMPREHENSIVE COMMON PAID IN
TOTAL INCOME (LOSS) (DEFICIT) INCOME (LOSS) STOCK CAPITAL
-------- ------------- --------- ------------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at March 29, 1998........ $65,000 $ 0 $ 0 $ -- $65,000
Comprehensive income (loss)......
Net income (loss).............. (1,212) $(1,212) (1,212)
-------
Gross unrealized holding
gains........................ 172 172
Foreign currency translation... (310) (310)
-------
Other comprehensive income
(loss)....................... (138) (138)
-------
Comprehensive income (loss)...... $(1,350)
=======
------- ------- ----- ---------- -------
Balance at December 26, 1998..... $63,650 $(1,212) $(138) $ -- $65,000
======= ======= ===== ========== =======
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-19
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD MARCH 29, 1998 (INCEPTION) THROUGH DECEMBER 26, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<S> <C>
Cash flows from operating activities:
Loss from operations...................................... $ (1,212)
Adjustments to reconcile net loss to net cash provided by
operating activities:
Depreciation............................................ 18,763
Amortization of intangibles............................. 1,862
Amortization of deferred agent contract costs........... 1,886
Amortization of deferred debt issuance costs............ 705
Provision for losses on accounts and notes receivable... 1,128
Deferred income taxes................................... (8,215)
Gain on sale of equipment............................... (36)
Change in other comprehensive income (loss)............. (138)
Change in assets and liabilities:
Accounts and notes receivable......................... (14,638)
Contracts receivable.................................. (4,236)
Prepaids and other current assets..................... (98)
Accounts payable...................................... 4,041
Other current liabilities............................. 4,927
Insurance reserves and accruals....................... (5,592)
Other long-term assets and liabilities................ (980)
Income tax payable.................................... 271
--------
Net cash used for operating activities...................... (1,562)
--------
Cash flows from investing activities:
Additions of property and equipment....................... (5,698)
Proceeds from sale of property and equipment.............. 874
Purchases of investments.................................. (135)
Proceeds from maturity or sale of investments............. 100
Payment of deferred agent contract costs.................. (1,485)
--------
Net cash used for investing activities...................... (6,344)
--------
Cash flows from financing activities:
Borrowings on revolving credit facility and notes
payable................................................. 96,000
Repayment of revolving credit facility and notes
payable................................................. (71,125)
Change in balance of outstanding checks................... (1,205)
Borrowings on long-term debt.............................. 83
Principal payments on long-term debt...................... (2,004)
Principal payments under capital lease obligation......... (62)
Payment for sale of insurance liabilities................. (13,500)
Minority interest......................................... 58
Payment to NS for working capital purchase price
adjustment.............................................. (7,492)
--------
Net cash provided by financing activities................... 753
--------
Net decrease in cash and cash equivalents................... (7,153)
Cash and cash equivalents at March 29, 1998................. 9,227
--------
Cash and cash equivalents at December 26, 1998.............. $ 2,074
========
Supplemental disclosure of cash flow information--cash paid
during the period March 29, 1998 (inception) through
December 26, 1998:
Interest.................................................. $ 11,347
Income taxes.............................................. $ 9,211
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-20
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) BUSINESS DESCRIPTION AND ORGANIZATION
On January 9, 1998, NA Acquisition Corporation, a Delaware Corporation (NA
Acquisition) and a wholly-owned subsidiary of NA Holding Corporation, a Delaware
Corporation (NA Holding), agreed to acquire (the "Acquisition") all of the
capital stock of NAVL from Norfolk Southern Corporation (NS) and J.P. Morgan
Ventures Corporation (J.P. Morgan) for an aggregate purchase price of $222,135,
including fees and expenses of $13,600. NA Acquisition and NA Holding were
formed by Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands
exempted limited partnership (Fund V), and a private investment fund that is
managed by Clayton, Dubilier & Rice, Inc.
At the closing of the Acquisition (the "Closing") on March 29, 1998, NA
Acquisition purchased all of the issued and outstanding common stock of North
American Van Lines, Inc. (NAVL or the Company) from NS for an aggregate purchase
price of $200,025, subject to pre- and post-closing purchase price adjustment
provisions based on changes in net working capital between December 27, 1997,
and closing, and all of the issued and outstanding preferred stock of NAVL from
J.P. Morgan for cash in the aggregate amount of $1,000 plus all accrued and
unpaid dividends through the Closing of $18. Based on the purchase price
adjustment provisions, $7,492 was paid by NAVL to NS on August 26, 1998. After
the Closing, NA Acquisition was merged with and into NAVL, with NAVL being the
surviving corporation and a direct wholly-owned subsidiary of NA Holding.
The Acquisition of NAVL was financed through a combination of $150,000 in
senior secured debt and $65,000 in cash equity contributed by Fund V and NAVL
management investors. On March 30, 1998, the Company entered into a senior
secured credit facility (the "Credit Agreement") with several lenders including
The Bank of New York and Chase Manhattan Bank. The senior secured credit
facility is comprised of a seven year $45,000 term loan facility (Tranche A), an
eight year $100,000 term loan facility (Tranche B), and a seven year $85,000
revolving credit facility (Revolving Credit Facility). The purchase method of
accounting was used to record the Acquisition. Independent appraisals were used
where appropriate.
NAVL is a diversified motor carrier operating principally throughout the
United States, Canada, Germany, and the United Kingdom. NAVL's principal lines
of business are household goods moving which provide 53% of revenues and high
value products transportation and logistics services which provide 47% of
revenues. Approximately 95% of revenues are derived from operations in the
United States and Canada with 5% from operations in Europe. NAVL conducts
operations primarily through a network of exclusive agents with over 750
locations in the U.S. and Canada and approximately 400 representatives on an
international basis.
The Company includes a subsidiary which operates as a multiple-line property
and liability insurance company under the provisions of the insurance laws of
the State of Indiana and primarily insures owner-operators and agents of NAVL
against loss from certain risks, primarily physical damage to tractors and
straight trucks.
F-21
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(b) BASIS OF CONSOLIDATION
The consolidated financial statements include the accounts of North American
Van Lines, Inc. and its subsidiaries, all but one of which are wholly owned. In
June 1997 the Company acquired a 51% share of a limited liability company (LLC),
Manufacturing Support Services, LLC (MSS). The financial statements include the
results of MSS and an appropriate recognition of minority interest is reflected
in the financial statements. All material intercompany accounts and transactions
have been eliminated in consolidation. The Consolidated Statement of Income
includes the results of operations for the period from the date of acquisition,
March 29, 1998, through December 26, 1998.
(c) CASH EQUIVALENTS
Cash equivalents are highly liquid investments purchased three months or
less from maturity.
(d) CONTRACTS RECEIVABLE AND EQUIPMENT HELD FOR SALE
In the normal course of business, the Company sells revenue equipment
(equipment held for sale) to its agents and to owner-operators under conditional
sales agreements (contracts receivable). Sales of revenue equipment are recorded
using the installment method of accounting. Gains are recognized as cash is
received and losses are recognized as incurred. Unrealized gains on these
transactions amounted to $3,311 and $3,752 at December 26, 1998 and March 29,
1998, respectively, of which $1,496 and $1,793, respectively, are netted against
current portion of contracts receivable and $1,815 and $1,959, respectively, are
netted against long-term portion of contracts receivable. Equipment held for
sale is recorded at the lower of cost or net realizable value.
(e) SUPPLIES INVENTORY
Supplies inventory consists of replacement parts, tires and other items for
resale, supplies for revenue equipment and office supplies and is valued at the
lower of average cost or market value.
(f) INVESTMENTS
Investments consist of U.S. Treasury, corporate debt and equity securities.
The Company classifies its debt and equity securities in one of two categories:
available-for-sale, or held-to-maturity. Held-to-maturity securities are those
securities in which the Company has the ability and intent to hold the security
until maturity (primarily bonds). All other securities are classified as
available-for-sale.
Available-for-sale securities are recorded at fair value. Held-to-maturity
securities are recorded at amortized cost, adjusted for the amortization or
accretion of premiums or discounts. Unrealized holding gains and losses, net of
the related tax effect, on available-for-sale securities are excluded from
earnings and are reported as a separate component of other comprehensive income
until realized. Realized gains and losses from the sale of available-for-sale
securities are determined on a specific identification basis.
F-22
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(g) PROPERTY AND EQUIPMENT
Property and equipment are stated primarily at cost. Depreciation is
computed on a straight-line basis over the estimated useful lives of the
respective assets. The estimated useful lives and salvage values as of December
26, 1998 used in computing depreciation are summarized as follows:
<TABLE>
<CAPTION>
USEFUL LIFE SALVAGE VALUE
-------------- ----------------------
<S> <C> <C>
Buildings..................................... 20 to 40 years --
Trailers...................................... 15 years $2 per unit
Other Equipment............................... 1 to 10 years 0-25%, max $5 per unit
</TABLE>
Repairs and maintenance expenditures are charged to expenses as incurred.
The amount of internally developed software that was capitalized during the
nine months ended December 26, 1998 was $519 and is included in Other Equipment.
(h) INTANGIBLE ASSETS
Intangible assets consist of trade names and goodwill totaling $99,312 as of
March 29, 1998 and $97,450 as of December 26, 1998. Trade names and goodwill are
amortized on a straight-line basis over their estimated lives of 40 years.
Accumulated amortization was $1,862 at December 26, 1998.
(i) LONG-LIVED ASSETS
Long-lived assets, including intangible assets, used in the company's
operations are reviewed for impairment when circumstances indicate that the
carrying amount of an asset may not be recoverable. The primary indicators of
recoverability are the associated current and forecasted undiscounted operating
cash flows.
(j) DEFERRED AGENT CONTRACT COSTS
Deferred agent contract costs are commitments made to agents for entering
into long-term contracts with NAVL. These commitments are capitalized and
amortized over the lives of the related contracts, which are generally 10 years.
(k) INSURANCE RESERVES AND ACCRUALS
The Company has sold its casualty and workers' compensation liabilities for
claims incurred in 1997 and prior to American International Group (AIG) for
$40,000 payable in three installments. The first installment of $13,500 was paid
in April of 1998 and the following two payments will be made in 1999 and 2000.
At the same time NAVL purchased first dollar coverage for all insurance areas
except cargo damage and delay claims. The Company estimates costs relating to
cargo damage and delay claims based on actuarial methods.
F-23
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(l) REVENUE RECOGNITION
The Company recognizes estimated revenue and related transportation expenses
on the date a shipment is delivered or services are completed. The estimate of
revenue remains in a receivable account called Delivered Not Processed (DNP)
until the customer is invoiced. The estimated Purchased Transportation Expenses
(PTE) are not reversed until invoicing occurs and actual expenses are recorded.
(m) FOREIGN CURRENCY TRANSLATION
The Company's foreign operations use the local currency as their functional
currency. Assets and liabilities of these operations are translated at the
exchange rates in effect on the balance sheet date. Income statement items are
translated at the average exchange rate for the nine month period. The impact of
currency fluctuation is included in stockholders' equity as accumulated other
comprehensive income.
(n) INCOME TAXES
Income taxes are accounted for under the asset and liability method of
accounting. Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax laws
and tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. The effect on
deferred tax assets and liabilities due to a change in tax rates is recognized
in income in the period that includes the enactment date. In addition, the
amount of any future tax benefits are reduced by a valuation allowance to the
extent such benefits are not expected to be realized on a more likely than not
basis.
(o) USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. Some of the
areas where estimation is significant are as follows: DNP is the estimated
revenue associated with shipments delivered or services completed and not
invoiced. PTE is the associated purchased transportation expense that is
estimated corresponding to the DNP revenue. Accounts and notes receivable
reserves for doubtful accounts are estimates based on historical writeoff data
to establish the uncollectible portion of the receivables. Costs relating to
cargo damage and delay claims are estimated based on actuarial methods.
F-24
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(2) INVESTMENTS
Investments consist primarily of debt and equity securities held by the
Company's insurance subsidiary. These marketable investment securities at
December 26, 1998 and March 29, 1998 include:
<TABLE>
<CAPTION>
DECEMBER 26, 1998 MARCH 29, 1998
--------------------------------- ---------------------------------
UNREALIZED UNREALIZED
FAIR AMORTIZED HOLDING FAIR AMORTIZED HOLDING
VALUE COST GAINS VALUE COST GAINS
-------- --------- ---------- -------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Current
Available-for-sale................. $1,947 $1,699 $248 $1,752 $1,752 $ --
Held-to-maturity................... 110 109 1 109 109 --
------ ------ ---- ------ ------ -----
Total current........................ $2,057 $1,808 $249 $1,861 $1,861 $ --
====== ====== ==== ====== ====== =====
Noncurrent
Available-for-sale................. $ -- $ -- $ -- $ -- $ -- $ --
Held-to-maturity................... 843 823 20 839 827 12
------ ------ ---- ------ ------ -----
Total noncurrent..................... $ 843 $ 823 $ 20 $ 839 $ 827 $ 12
====== ====== ==== ====== ====== =====
</TABLE>
The market value of this portfolio includes gross unrealized gains of $248
and $0 at December 26, 1998 and March 29, 1998 respectively.
In addition, investments of $274 and $234 at December 26, 1998 and March 29,
1998, respectively, included noncurrent investments in joint ventures.
(3) PREPAID EXPENSES AND OTHER CURRENT ASSETS
<TABLE>
<CAPTION>
DECEMBER 26, 1998 MARCH 29, 1998
----------------- --------------
<S> <C> <C>
Prepaid expenses and other current assets are comprised
of the following:
Prepaid rent......................................... $ 999 $ 901
Prepaid systems maintenance.......................... 109 813
Prepaid taxes and licenses........................... 547 882
Prepaid insurance.................................... 376 207
Intercompany receivable from NA Holding.............. 6,806 6,546
Other................................................ 979 1,542
------ -------
$9,816 $10,891
====== =======
</TABLE>
F-25
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(4) INTANGIBLE ASSETS
<TABLE>
<CAPTION>
DECEMBER 26, 1998 MARCH 29, 1998
----------------- --------------
<S> <C> <C>
Intangible assets included the following:
Trade names.......................................... $75,700 $75,700
Goodwill............................................. 23,612 23,612
Accumulated amortization............................. (1,862) --
------- -------
$97,450 $99,312
======= =======
</TABLE>
(5) OTHER ASSETS
<TABLE>
<CAPTION>
DECEMBER 26, 1998 MARCH 29, 1998
----------------- --------------
<S> <C> <C>
Other assets consisted of the following:
Deferred debt issuance costs......................... $ 6,349 $7,054
Prepaid pension...................................... 3,304 490
Deposits............................................. 556 453
Other................................................ 266 326
------- ------
$10,475 $8,323
======= ======
</TABLE>
(6) INCOME TAXES
(a) PROVISION FOR INCOME TAXES
The Company files a consolidated federal income tax return with its
wholly-owned domestic subsidiaries.
The provision for income taxes for the period March 29, 1998 through
December 26, 1998 includes:
<TABLE>
<S> <C>
Current:
Federal................................................... $ 6,682
Foreign................................................... 1,247
State..................................................... 1,500
-------
Total current taxes......................................... $ 9,429
-------
Deferred:
Federal................................................... $(7,120)
Foreign................................................... (44)
State..................................................... (1,154)
-------
Total deferred taxes........................................ $(8,318)
-------
Provision for income taxes.................................. $ 1,111
=======
</TABLE>
F-26
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(6) INCOME TAXES (CONTINUED)
(b) RECONCILIATION OF STATUTORY RATE TO EFFECTIVE RATE
Total income taxes as reflected in the Consolidated Statement of Income
differ from the amounts computed by applying the statutory federal corporate tax
rate as follows:
<TABLE>
<S> <C>
Federal income tax at statutory rate........................ $ (35)
State income taxes, net of federal tax benefit.............. 225
Foreign taxes............................................... 279
Intangibles................................................. 155
Contingent liabilities...................................... 368
Other, net.................................................. 119
------
Provision for income taxes.................................. $1,111
======
</TABLE>
(c) DEFERRED TAX ASSETS AND LIABILITIES
The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities at December 26,
1998 and March 29, 1998 were as follows:
<TABLE>
<CAPTION>
DECEMBER 26, 1998 MARCH 29, 1998
----------------- --------------
<S> <C> <C>
Deferred tax assets:
Property..................................... $ 3,862 $ 155
Reserves, including casualty and other
claims..................................... 15,464 11,629
Employee benefits............................ 4,111 2,992
Taxes other than income taxes................ 2,434 2,142
Postretirement benefits other than pension
and postemployment benefits................ 6,080 5,595
Foreign tax net operating loss
carryforwards.............................. 607 1,290
Other........................................ 97 5
------- --------
Total gross deferred tax assets................ 32,655 23,808
Less valuation allowance....................... (103) (924)
------- --------
Net deferred tax asset......................... 32,552 22,884
------- --------
Deferred tax liabilities:
Employee benefits............................ 1,385 865
State income taxes........................... 472 40
Amortization, unrealized gains and other..... 20,920 20,419
------- --------
Total gross deferred tax liabilities........... 22,777 21,324
------- --------
Net deferred tax assets........................ 9,775 1,560
Less net current deferred tax assets........... 15,127 12,157
------- --------
Net long-term deferred tax liabilities......... $(5,352) $(10,597)
======= ========
</TABLE>
F-27
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(6) INCOME TAXES (CONTINUED)
At December 26, 1998 and March 29, 1998, a valuation allowance has been
established due to the uncertainty of realization of foreign net operating loss
(NOL) carryforwards. The net change in the total valuation allowance for the
period March 29, 1998 through December 26, 1998 was a decrease of $821. The
decrease was a result of a utilization of certain NOL benefits and a reduction
to the valuation allowance as realization appears more certain. Management
believes all other deferred tax assets will be realized based on the Company's
anticipated future earnings or available tax planning alternatives.
(d) TAXING AUTHORITY REVIEWS
Consolidated federal income tax returns of NS (which include Predessor) have
been examined and Revenue Agent Reports have been received for all years up to
and including 1994. The consolidated federal income tax returns of NS for 1995
and 1996 are being audited by the IRS. NS will indemnify The Company for any tax
liabilities prior to the acquisition to the extent they were not accrued at the
purchase date.
(7) REVOLVING CREDIT FACILITY
Under the Revolving Credit Facility the Company may borrow up to $85,000.
The Credit Agreement requires that the balance borrowed under the Revolving
Credit Facility be no greater than $45,000 for 30 consecutive days in the first
quarter of each year. Interest on Revolving Credit Facility borrowing is based
on LIBOR or ABR rates, dependent upon the maturity date of the loan selected and
required notice of the borrowing request, plus a margin of 0.5% to 2.5%.
Interest and principal are paid on the maturity date of the loan with the
principal being reborrowed if desired. Each advance is made in increments of no
less than $5,000. If lesser amounts are required, then a swing line loan may be
activated. Interest on swing line borrowing is based on the ABR rate plus a
margin of 0.5% to 1.5%. Interest is paid at the end of each quarter and
principal when funds are available. The Company pays a commitment fee of 0.3% to
0.5% on the unused portion of the Revolving Credit Facility. See "Long-term Debt
and Lease Obligation" disclosure regarding covenants relating to this facility.
F-28
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(8) OTHER CURRENT LIABILITIES
<TABLE>
<CAPTION>
DECEMBER 26, 1998 MARCH 29, 1998
----------------- --------------
<S> <C> <C>
The components of other current liabilities are
as follows:
Accrued purchase price adjustment............ $ -- $ 7,492
Accrued transaction fees..................... 238 5,002
Accrued agent and owner operator
incentives................................. 5,236 1,972
Accrued customer volume discounts............ 1,362 1,074
Accrued interest............................. 1,389 1,227
Accrued unvouchered payables................. 6,150 6,136
Accrued other taxes.......................... 5,105 4,926
Deferred credits............................. 761 761
Intercompany payable to NA Holding........... 3,569 --
Other........................................ 361 383
------- -------
$24,171 $28,973
======= =======
</TABLE>
(9) LONG-TERM DEBT AND LEASE OBLIGATION
<TABLE>
<CAPTION>
DECEMBER 26, 1998 MARCH 29, 1998
----------------- --------------
<S> <C> <C>
Note payable--Tranche A interest at 90 day
LIBOR rate plus 2.5% with interest and
principle paid quarterly..................... $ 44,000 $ 45,000
Note payable--Tranche B interest at 90 day
LIBOR rate plus 2.75% with interest and
principle paid quarterly..................... 99,000 100,000
Note payable with interest at prime, monthly
installments of $1.4, expiring in 2003....... 79 --
Capital lease obligation with interest at 5.5%
and expiring in 2005......................... 541 603
-------- --------
Total long-term debt and capital lease
obligation................................... $143,620 $145,603
Less current maturities........................ 3,599 2,958
-------- --------
$140,021 $142,645
======== ========
</TABLE>
The Credit Agreement contains various loan covenants including an interest
coverage ratio and a senior debt ratio. The Credit Agreement also includes a
general lien on certain of the Company's assets.
F-29
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(9) LONG-TERM DEBT AND LEASE OBLIGATION (CONTINUED)
Aggregate principle payments for the next five years subsequent to December
26, 1998 are as follows:
<TABLE>
<CAPTION>
TRANCHE OTHER LONG- CAPITAL
A & B DEBT TERM DEBT LEASE TOTAL
---------- ----------- -------- --------
<S> <C> <C> <C> <C>
1999................................. $ 3,500 $16 $ 83 $ 3,599
2000................................. 6,000 16 92 6,108
2001................................. 8,000 16 97 8,113
2002................................. 8,000 16 102 8,118
2003................................. 11,000 15 108 11,123
</TABLE>
The Company has available unused lines of credit of $61,616 and $87,642 at
December 26, 1998 and March 29, 1998, respectively.
The fair value of the Company's long-term debt approximates the carrying
amount based on the present value of cash flows discounted at the current rates
offered to the Company on similar debt instruments.
(10) RETIREMENT, POSTRETIREMENT MEDICAL PLANS
The Company's United States plans' funded status and amount recognized in
the Company's consolidated financial statements at December 26, 1998 and March
29, 1998 (based on actuarial valuation) are as follows:
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
---------------- --------------
<S> <C> <C>
CHANGE IN BENEFIT OBLIGATION
Benefit obligation at March 29, 1998............. $43,726 $12,066
Service cost..................................... 2,062 677
Interest cost.................................... 2,368 641
Plan participants' contribution.................. -- 15
Actuarial loss................................... 2,764 629
Benefits paid.................................... (2,117) (342)
------- -------
Benefit obligation at December 26, 1998........ $48,803 $13,686
======= =======
CHANGE IN PLAN ASSETS
Fair value of plan assets at March 29, 1998...... $43,472
Actual return on plan assets..................... 2,552
Employer contribution............................ 4,070
Benefits paid.................................... (2,117)
-------
Fair value of plan assets at December 26,
1998......................................... $47,977
=======
</TABLE>
F-30
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(10) RETIREMENT, POSTRETIREMENT MEDICAL PLANS (CONTINUED)
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
---------------------------------- ----------------------------------
DECEMBER 26, 1998 MARCH 29, 1998 DECEMBER 26, 1998 MARCH 29, 1998
----------------- -------------- ----------------- --------------
<S> <C> <C> <C> <C>
Benefit obligation................ $48,803 $43,726 $ 13,686 $ 12,066
Plan assets....................... 47,977 43,472 -- --
------- ------- -------- --------
Funded status..................... (826) (254) (13,686) (12,066)
Unrecognized net actuarial loss... 3,277 -- 629 --
------- ------- -------- --------
Prepaid (accrued) benefit cost.... $ 2,451 $ (254) $(13,057) $(12,066)
======= ======= ======== ========
WEIGHTED-AVERAGE ASSUMPTIONS
Discount rate..................... 6.90% 7.25% 6.90% 7.25%
Expected return on plan assets.... 9.00% 9.00%
Rate of compensation increase..... 4.40% 5.00%
</TABLE>
For measurement purposes, an 8% annual rate of increase in the per capita
cost of covered health care benefits was assumed for the period March 29, 1998
through December 26, 1998. The rate was assumed to decrease gradually to 5% for
2004 and remain at that level thereafter.
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
---------------- --------------
<S> <C> <C>
COMPONENTS OF NET PERIODIC BENEFIT COST
Service cost..................................... $ 2,062 $ 677
Interest cost.................................... 2,368 641
Expected return on plan assets................... (3,065) --
------- ------
Net periodic benefit cost........................ $ 1,365 $1,318
======= ======
</TABLE>
The Company sponsors the NAVL, Inc. Employee Retirement Plan, a funded,
noncontributory defined benefit pension plan (Qualified Plan) covering eligible
employees in the United States. The Qualified Plan provides for eligible
employees to receive retirement benefits based principally on years of service
with the Company, compensation rates over that time, and estimated primary
Social Security benefits. Contributions to the Qualified Plan are made on the
basis of not less than minimum funding standards set forth in the Employee
Retirement Income Security Act of 1974, as amended. Plan assets consist
primarily of common stocks and government securities.
The Company also has an Excess Benefit Plan which is an unfunded,
nonqualified plan that provides retirement benefits not otherwise provided under
the Qualified Plan because of the benefit limitations imposed by Section 415 and
401(a)(17) of the Internal Revenue Code. The Excess Benefit Plan ensures that an
executive receives the total pension benefit to which he/she otherwise would be
entitled, were it not for such limitations.
In addition, the Overlap Benefit Plan, an unfunded, nonqualified retirement
plan, provides retirement benefits forfeited by the highly compensated employees
under the Qualified Plan because of the changes to the retirement plan formula
which took effect April 18, 1989.
F-31
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(10) RETIREMENT, POSTRETIREMENT MEDICAL PLANS (CONTINUED)
The Company has nonpension postretirement benefit plans that provide
specific health care and death benefits to eligible retired employees. Under the
present plans, which may be amended or terminated at the Company's option, a
defined percentage of health care expenses is covered, after reductions for any
deductibles, co-payments, Medicare payments and, in some cases, coverage
provided by other group insurance policies. The cost of such health care
coverage to a retiree may be determined in part by a retiree's years of vested
service with the Company prior to retirement. Death benefits are based on a
fixed amount at time of retirement.
Assumed health care cost trend rates have a significant effect on the
amounts reported for the health care plans. A one-percentage-point change in
assumed health care cost trend rates would have the following effects:
<TABLE>
<CAPTION>
1-PERCENTAGE-POINT 1-PERCENTAGE-POINT
INCREASE DECREASE
------------------ ------------------
<S> <C> <C>
Effect on total of service and interest cost
components................................. $ 255 $ (210)
Effect on postretirement benefit
obligation................................. 1,739 (2,482)
</TABLE>
The Company's German subsidiary, midiData, has an unfunded pension plan
under which certain employees of the company will receive certain percentages of
their monthly income when they retire. At the end of 1998, the accumulated
benefit obligation was $1,683 and the projected benefit obligation was $1,756.
The remaining transition obligation of $225 is being amortized over the
remaining average service life of 9 years.
The Company's Canadian subsidiary, North American Van Lines Canada Ltd., has
a defined benefit plan with the benefits generally based upon years of service
and the highest five-year average salary during employment. At the end of 1998,
the actuarial present value of accrued pension benefits was $1,356 and the
aggregate market value of pension plan assets was $1,539.
In 1994, the Company's United Kingdom subsidiary, North American Van Lines,
Ltd., established a contributory defined contribution plan for eligible
employees. The plan is funded through contributions from employees, generally 3%
of earnings, that are matched by the Company.
The Company maintains an employee savings plan for eligible employees which
qualifies under Sections 401(a) and 401(k) of the Internal Revenue Code. The
Company has made no contributions to the plan since its inception.
(11) POSTEMPLOYMENT MEDICAL PLAN
The Company provides certain postemployment benefits to inactive employees
and their dependents during the period following employment but before
retirement. Effective the beginning of 1994, the Company adopted FAS No. 112
which requires the accrual of the cost of postemployment benefits rather than
expensing the costs when paid. These benefits are for continuation of health
care coverage. At December 26, 1998, the accumulated postemployment benefit
obligation was $1,933.
F-32
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(12) INCENTIVE AND DEFERRED COMPENSATION
The Company maintains a Management Incentive Plan for certain executives and
key management employees. The plan is administered by the Board of Directors who
do not participate in the plan. Incentive compensation is based upon achievement
of certain predetermined corporate performance goals.
The Company also maintains Evidence of Success incentive programs for
eligible employees not included in the Management Incentive Plan. The plan is
administered by the Vice President Human Resources, who does not participate in
the plan. Incentive compensation is based upon achievement of certain
predetermined corporate performance goals. The expense associated with the
incentive plans was $5,032 for the period March 29, 1998 through December 26,
1998.
(13) STOCK OPTION PLAN
In 1998, NA Holding adopted a stock option plan (the "Plan") for officers
and other key employees. At December 26, 1998, a total of 71,400 shares of
authorized but unissued common stock have been reserved for issuance under the
Plan upon the exercise of the options. The administrator of the Plan is
NA Holding's Board of Directors. Under the Plan, two options have been granted
with each share of stock sold to the officers and other key employees. Options
granted are of two types: Service Options and Performance Options. Service
Options are vested in equal annual installments on each of the first five
anniversaries of the grant date. Performance Options are vested dependant on
achievement of cumulative EBITDA targets, or if not vested sooner, become vested
on the ninth anniversary of the grant date. All options granted expire after ten
years from the grant date. The exercise price of the options equaled the fair
market value of common stock at the date of the grant. Fair market value was
determined by management to be equal to the price paid for common stock issued
in respect to the Acquisition.
Information with respect to the options granted by NA Holding under the Plan
is as follows:
<TABLE>
<CAPTION>
# OF WEIGHTED AVG.
SHARES EXERCISE PRICE
-------- --------------
<S> <C> <C>
Outstanding at March 29, 1998
Options granted...................................... 76,600 $100
Options exercised.................................... -- --
Options cancelled.................................... 5,200 100
------ ----
Outstanding at December 26, 1998....................... 71,400 $100
====== ====
</TABLE>
In accordance with the provisions of Statement of Financial Accounting
Standards (SFAS) No. 123, "Accounting for Stock-Based Compensation", NA Holding
has elected to continue to account for stock-based compensation under the
intrinsic value based method of accounting described by Accounting Principles
Board (APB) Opinion No. 25, "Accounting for Stock Issued to Employees". Under
APB No. 25, generally no cost is recorded for stock options issued to employees
unless the option price is below market at the time options are granted.
Had NA Holding elected to apply the provisions of SFAS No. 123 regarding
recognition of compensation expense to the extent of the calculated fair value
of stock options granted during the period March 29, 1998 through December 26,
1998, NA Holding would have charged the Company for the
F-33
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(13) STOCK OPTION PLAN (CONTINUED)
additional compensation expense. Therefore, the net loss of the Company would
have been increased as follows:
<TABLE>
<S> <C>
Net loss as reported........................................ $(1,212)
Pro forma net loss.......................................... $(1,381)
</TABLE>
The fair value of each option is estimated on the date of grant, using the
Black-Scholes option pricing model with the following weighted average
assumptions used: risk-free interest rates ranging from 4.67% to 5.72%, expected
option lives of 5 years and no dividend payments.
(14) COMMITMENTS AND CONTINGENCIES
(a) LETTERS OF CREDIT AND DEBT GUARANTEES
The Company's German subsidiary, midiData, has guarantees to WTB Leasing
GmbH and CommerzLease for equipment leases. These leases extend through the year
2003. The Company's United Kingdom subsidiary, North American Van Lines, Ltd.,
has guarantees to various parties for customs and excise taxes.
(b) LAWSUITS
The Company and certain subsidiaries are defendants in numerous lawsuits
relating principally to motor carrier operations. While the final outcome of
these lawsuits cannot be predicted with certainty, it is the opinion of
management, after consulting with its legal counsel, that the amount of the
Company's ultimate liability will not materially affect the Company's
consolidated financial position, results of operations or liquidity.
(c) ENVIRONMENTAL MATTERS
The Company has been named as a potentially responsible party (PRP) in two
environmental cleanup proceedings by federal or state authorities and one
additional environmental clean-up proceeding by a group of PRP's. The suits are
brought under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, or other federal or state statutes. Based on
all known information, it is estimated that the settlement cost of each PRP site
would not be materially or significantly larger than the litigation reserves
established, which totaled $35 and $57 on December 26, 1998 and March 29, 1998,
respectively. It is possible that additional claims or lawsuits involving
unknown environmental matters or now unidentified environmental sites may arise
in the future.
The Company owns or has owned and leases or has leased facilities at which
underground storage tanks for diesel fuel are located and operated. Management
believes that the Company has taken the appropriate and necessary action with
regard to releases of diesel fuel that have occurred. As conditions may exist on
these properties related to environmental problems that are latent or
undisclosed, there can be no assurance that the Company will not incur
liabilities or costs, the amount of which cannot be estimated reliably at this
time. However, based on its assessment of the facts and circumstances now known
and after consulting with its legal counsel, management believes that it has
recorded appropriate estimates
F-34
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(14) COMMITMENTS AND CONTINGENCIES (CONTINUED)
of liability for those environmental matters of which the Company is aware.
Further, management believes it is unlikely that any identified matters, either
individually or in aggregate, will have a material effect on the Company's
financial position, results of operations or liquidity.
(d) PURCHASE COMMITMENTS
The Company has entered into certain purchase commitments for trailers and
software licenses in the amount of $2,984 as of December 26, 1998 and $0 as of
March 29, 1998.
(15) LEASE COMMITMENTS
The Company has noncancelable lease commitments under operating leases for
rental of office space, warehouse facilities, and office equipment. The
Company's rental expense under these operating leases was $12,448 for the nine
months ended December 26, 1998. Future minimum lease commitments under
noncancelable leases are as follows: 1999, $16,945; 2000, $13,644; 2001,
$10,946; 2002, $8,468; 2003, $4,117, and thereafter $7,437.
(16) FINANCIAL INSTRUMENTS
The Company utilizes interest rate agreements and foreign exchange contracts
to manage interest rate and foreign currency exposures. The principal objective
of such contracts is to minimize the risks and/or costs associated with
financial and international operating activities. The Company does not utilize
financial instruments for trading or other speculative purposes. The
counterparties to these contractual arrangements are financial institutions with
which the Company also has other financial relationships. The Company is exposed
to credit loss in the event of nonperformance by these counterparties. However,
the Company does not anticipate nonperformance by the other parties, and no
material loss would be expected from their nonperformance.
(a) INTEREST RATE INSTRUMENTS
The Company entered into an interest rate swap agreement on June 4, 1998 to
reduce the impact of changes in interest rates on its floating rate debt. The
swap agreement is a contract to exchange floating rate for fixed interest
payments periodically over the life of the agreement without the exchange of the
underlying notional amount. The notional amount of the interest rate agreement
is used to measure interest to be paid or received and does not represent the
amount of exposure to credit loss. The net cash amounts paid or received on the
interest rate swap agreement are accrued and recognized as an adjustment to
interest expense.
As of December 26, 1998, the Company had the following interest rate swap in
effect:
<TABLE>
<S> <C>
Notional amount............................................. $75,000
Fixed interest rate......................................... 5.90%
Strike period............................................... 6/1998-6/2001
</TABLE>
F-35
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(16) FINANCIAL INSTRUMENTS (CONTINUED)
Based on the amount that the Company would pay to exit the contract, the
fair value of the interest rate swap agreement at December 26, 1998 was $1,358.
(b) FOREIGN EXCHANGE INSTRUMENTS
The Company enters into forward currency exchange contracts in the regular
course of business to manage its exposure against foreign currency fluctuations
on transactions denominated in foreign currencies. The Company had no open
positions on forward exchange contracts at December 26, 1998 and March 29, 1998.
(17) OPERATING SEGMENTS
The Company has two reportable segments--Van Line Network and Logistics
Services.
The Van Line Network segment provides domestic and international residential
relocation services through a network of exclusive agents. It is comprised of
the Relocation Services Division, which provides packing, loading,
transportation, delivery and warehousing services for any type of household move
in the U.S. and Canada, and the International Division, which provides or
coordinates these same services for customers on a global basis.
The Logistics Services segment provides customized logistics solutions,
specialized transportation services, warehousing, distribution, and delivery
services to commercial customers. It is comprised of the Logistics Division,
which provides these specialized services to principally electronics, medical
equipment and other suppliers of sensitive goods requiring specialized handling
in the U.S., the Blanket Wrap/Flatbed Division, which provides transportation of
truckload freight requiring specialized handling in the U.S., and the Europe
Division, which provides these same logistics services in Europe and the U.K.
The table below represents information about revenues, income from
operations and total assets by segment used by the chief decision-makers of the
Company for the period March 29, 1998 through December 26, 1998 and as of
December 26, 1998:
<TABLE>
<CAPTION>
VAN LINE LOGISTICS CONSOLIDATED
NETWORK SERVICES CORPORATE(1) TOTALS
-------- --------- ------------ ------------
<S> <C> <C> <C> <C>
Revenues......................................... $409,944 $349,263 $ -- $759,207
Income from Operations........................... 6,151 5,416 -- 11,567
Total Assets..................................... 94,595 110,876 186,592 392,063
</TABLE>
- ------------------------
(1) Total assets by segment are specific assets such as revenue equipment and
trade receivables. Assets included in the corporate category include
non-allocated assets such as the corporate headquarters building, computer
hardware and software, contracts receivable associated with equipment sales,
deferred taxes and goodwill.
F-36
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(17) OPERATING SEGMENTS (CONTINUED)
Specified items included in segment results for the period March 29, 1998
through December 26, 1998:
<TABLE>
<CAPTION>
VAN LINE LOGISTICS CONSOLIDATED
NETWORK SERVICES CORPORATE(2) TOTALS
-------- --------- ------------ ------------
<S> <C> <C> <C> <C>
Depreciation and amortization...................... $8,141 $14,370 $ -- $22,511
Non-operating income (expense) and minority
interest......................................... 182 (92) -- 90
</TABLE>
- ------------------------
(2) Depreciation expense for capital expenditures in the corporate category is
allocated to the segments in order to determine segment income from
operations.
Specified items included in segment assets of December 26, 1998:
<TABLE>
<CAPTION>
VAN LINE LOGISTICS CONSOLIDATED
NETWORK SERVICES CORPORATE TOTALS
-------- --------- ---------- ------------
<S> <C> <C> <C> <C>
Capital expenditures............................... $ 718 $ 2,591 $2,389 $ 5,698
</TABLE>
Revenue and long-lived asset information by geographic area for the period
March 29, 1998 through December 26, 1998 and as of December 26, 1998:
<TABLE>
<CAPTION>
LONG-LIVED
REVENUE ASSETS
-------- ----------
<S> <C> <C>
United States........................................... $696,224 $208,009
Foreign................................................. 62,983 3,761
-------- --------
Total................................................... $759,207 $211,770
======== ========
</TABLE>
Foreign revenue is based on the country in which the sales originated.
(18) SUPPLEMENTAL INFORMATION
On November 19, 1999, pursuant to an acquisition agreement dated
September 14, 1999, the Company acquired substantially all of the assets of
certain subsidiaries of NFC, plc, (the "Seller") that are engaged in the
Seller's moving services business. The acquisition was accounted for as a
purchase. Total purchase consideration was $400 million cash plus a combination
of preferred stock, common stock and common stock warrants with a combined value
of $50 million.
The acquisition was funded through borrowings under new credit facilities of
$390.0 million, proceeds from the issuance of $150.0 million of NAVL senior
subordinated notes, and an increase to stockholders' equity resulting from the
issuance of $24.5 million of junior preferred stock, $35.0 million of senior
discounted notes, and a common stock warrant totaling $65.5 million by NAVL's
parent, NA Holding. Of the $65.5 million, $40.0 million was initially in the
form of an interim loan facility made available to NA Holding. On December 1,
1999, Fund V and the Seller subscribed for and purchased additional shares of
common stock of NA Holding for $32.0 million and $8.0 million in cash,
respectively. The proceeds from this stock subscription were used to repay the
$40.0 million interim loan.
F-37
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(18) SUPPLEMENTAL INFORMATION (CONTINUED)
The following summarized consolidating balance sheet, statement of income,
and statement of cash flows have been presented in contemplation of the
transaction between NA Holding and the Seller, as described above. Such
financial statements have been segregated between those entities that have
guaranteed the NAVL senior subordinated notes issued in connection with the
transaction ("Guarantor" entities), and those entities that did not guarantee
such debt ("Non-Guarantor" entities).
Consolidating balance sheet data as of December 26, 1998 is summarized as
follows:
<TABLE>
<CAPTION>
(1) (2) NON- TOTAL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Current assets........................ $141,485 $ 9,098 $ 31,170 $ (1,460) $180,283
Non-current assets.................... 245,403 9,743 85,269 (128,645) 211,770
-------- ------- -------- --------- --------
Total assets.......................... $386,888 $18,841 $116,439 $(130,105) $392,063
======== ======= ======== ========= ========
Current liabilities................... $122,909 $ 6,531 $ 20,908 $ (1,460) $148,888
Non-current liabilities............... 200,329 718 2,650 (24,172) 179,525
-------- ------- -------- --------- --------
Total liabilities..................... 323,238 7,249 23,558 (25,632) 328,413
Stockholders' equity.................. 63,650 11,592 92,881 (104,473) 63,650
-------- ------- -------- --------- --------
Total liabilities and equity.......... $386,888 $18,841 $116,439 $(130,105) $392,063
======== ======= ======== ========= ========
</TABLE>
Consolidating statement of income data for the period March 29, 1998
(inception) through December 26, 1998 is summarized as follows:
<TABLE>
<CAPTION>
(1) (2) NON- TOTAL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Operating revenues.................... $650,603 $45,205 $ 73,010 $ (9,611) $759,207
Total operating expenses.............. 644,038 42,464 69,745 (8,607) 747,640
-------- ------- -------- --------- --------
Income (loss) from operations......... 6,565 2,741 3,265 (1,004) 11,567
Interest expense and other............ 6,666 43 2,006 2,953 11,668
-------- ------- -------- --------- --------
Income (loss) before income taxes..... (101) 2,698 1,259 (3,957) (101)
Provision/(benefit) for income
taxes............................... 1,111 1,079 504 (1,583) 1,111
-------- ------- -------- --------- --------
Net income (loss)..................... $ (1,212) $ 1,619 $ 755 $ (2,374) $ (1,212)
======== ======= ======== ========= ========
</TABLE>
F-38
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 26, 1998 AND MARCH 29, 1998
(DOLLARS IN THOUSANDS)
(18) SUPPLEMENTAL INFORMATION (CONTINUED)
Consolidating statement of cash flows data for the period March 29, 1998
(inception) through December 26, 1998 is summarized as follows:
<TABLE>
<CAPTION>
(1) (2) NON- TOTAL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Net cash provided by (used in)
operating activities.................. $ (2,956) $ 10 $ 1,384 $ -- $ (1,562)
Net cash used in investing
activities.......................... (5,483) -- (861) -- (6,344)
Net cash provided by (used in)
financing activities................ 2,998 58 (2,303) -- 753
Net increase (decrease) in cash and
cash equivalents.................... (5,441) 68 (1,780) -- (7,153)
Cash at beginning of period........... 5,752 27 3,448 -- 9,227
-------- ------- -------- --------- --------
Cash at end of period................. $ 311 $ 95 $ 1,668 $ -- $ 2,074
======== ======= ======== ========= ========
</TABLE>
- ------------------------
(1) Parent includes the accounts of North American Van Lines, Inc., a Delaware
corporation and the issuer of the debt in connection with the transaction.
(2) Total Guarantors include the accounts of the following subsidiaries of North
American Van Lines, Inc.: Fleet Insurance Management, Inc., an Indiana
corporation; FrontRunner Worldwide, Inc., a Delaware corporation; NACAL,
Inc., a California Corporation; NAVTRANS International Freight Forwarding,
Inc., and Indiana corporation; North American Distribution Systems, Inc., an
Indiana corporation; North American Logistics, Ltd., an Indiana corporation,
North American Van Lines of Texas, Inc., a Texas corporation; Relocation
Management Systems, Inc., a Delaware corporation; and Great Falls North
American, Inc., a Montana corporation. Each Guarantor is a wholly owned
subsidiary of North American Van Lines, Inc. and will jointly and severally,
irrevocably and fully and unconditionally guarantee the punctual payment of
such debt issued in connection with the transaction.
F-39
<PAGE>
[LOGO]
- --------------------------------------------------------------------------------
PRICEWATERHOUSECOOPERS
LLP
200 East Randolph Drive
Chicago IL 60601
Telephone (312) 540 1500
REPORT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
North American Van Lines, Inc.:
In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of income, stockholders' equity, and cash flows present
fairly, in all material respects, the financial position of North American Van
Lines, Inc. and its subsidiaries (the "Company") at March 28, 1998, and the
results of their operations and cash flows for the period December 28, 1997
through March 28, 1998, in conformity with generally accepted accounting
principles. These financial statements are the responsibility of the Company's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these statements in
accordance with generally accepted auditing standards which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for the opinion expressed
above.
/s/ PricewaterhouseCooper LLP
March 18, 1999, except as to Note 16,
for which the date is September 27, 1999,
and Note 17, for which the date is January 31, 2000.
F-40
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONSOLIDATED BALANCE SHEET
AT MARCH 28, 1998
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
ASSETS
<TABLE>
<S> <C>
Current assets:
Cash and cash equivalents................................. $ 9,227
Short-term investments.................................... 1,861
Accounts and notes receivable, net of allowance for
doubtful accounts of $12,469............................ 139,044
Current portion of contract receivables, net of valuation
allowance of $221....................................... 5,982
Supplies inventory........................................ 1,924
Equipment held for sale................................... 3,223
Current portion of deferred agent contract costs.......... 408
Prepaid expenses.......................................... 4,637
Deferred income taxes..................................... 21,899
---------
Total current assets........................................ 188,205
---------
Long-term portion of contract receivables................... 10,427
Long-term portion of notes receivables...................... 2,482
Investments................................................. 1,061
Deferred income taxes....................................... 8,865
Property and equipment:
Land...................................................... 1,743
Buildings................................................. 27,163
Trailers.................................................. 74,687
Other equipment........................................... 77,694
---------
181,287
Less accumulated depreciation............................. (124,933)
---------
56,354
Deferred agent contract costs............................... 16,065
Other assets................................................ 855
---------
Total assets................................................ $ 284,314
=========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-41
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONSOLIDATED BALANCE SHEET
AT MARCH 28, 1998
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<S> <C>
Current liabilities:
Current portion of long-term debt and lease obligations... $ 83
Revolving credit facility and notes payable............... 125
Accounts payable.......................................... 21,136
Outstanding checks........................................ 8,560
Accrued transportation expense............................ 32,739
Other current liabilities................................. 15,327
Insurance reserves and accruals........................... 23,437
Compensation and benefits................................. 19,474
Income taxes.............................................. 4,077
---------
Total current liabilities................................... 124,958
---------
Long-term debt and lease obligation......................... 520
Insurance reserves and accruals............................. 29,165
Compensation and benefits................................... 28,438
Minority interest........................................... 251
---------
Total liabilities........................................... 183,332
---------
Stockholders' equity
Preferred stock, $100.00 par value, 10,000 shares
authorized, issued, and outstanding..................... 1,000
Common stock, $1.00 par value, 10,000 shares authorized,
issued, and outstanding................................. 10
Additional paid-in-capital................................ 79,372
Retained earnings......................................... 20,819
Accumulated other comprehensive income (loss)............. (219)
---------
Total stockholders' equity.................................. 100,982
---------
Total liabilities and stockholders' equity $ 284,314
=========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-42
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONSOLIDATED STATEMENT OF INCOME
FOR THE PERIOD DECEMBER 28, 1997 THROUGH MARCH 28, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<S> <C>
Operating revenues.......................................... $207,245
Operating expenses:
Transportation............................................ 162,381
Administration............................................ 34,240
Insurance and claims...................................... 6,538
Depreciation.............................................. 2,256
Amortization.............................................. 639
Maintenance, tires and other operating.................... 4,302
Equipment sales and services, net......................... (977)
Insurance and supply programs, net........................ (799)
--------
Total operating expenses................................ 208,580
--------
Loss from operations.................................... (1,335)
Non-operating income........................................ 10
Minority interest........................................... (13)
--------
Loss before interest and taxes.......................... (1,338)
Interest income............................................. (240)
--------
Loss before income taxes................................ (1,098)
Income tax benefit.......................................... (448)
--------
Net loss................................................ $ (650)
========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-43
<PAGE>
NORTH AMERICAN VAN LINES, INC
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD DECEMBER 28, 1997 THROUGH MARCH 28, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
ACCUMULATED
OTHER ADDITIONAL
COMPREHENSIVE RETAINED COMPREHENSIVE PREFERRED COMMON PAID IN
TOTAL INCOME (LOSS) EARNINGS INCOME (LOSS) STOCK STOCK CAPITAL
-------- ------------- -------- ------------- --------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at December 27,
1997........................ $108,116 $27,933 $(199) $1,000 $10 $79,372
Comprehensive income (loss)...
Net loss.................... (650) $(650) (650)
-----
Gross unrealized holding
gains..................... 88 88
Foreign currency
translation............... (108) (108)
-----
Other comprehensive income
(loss).................... (20) (20)
-----
Comprehensive income (loss)... $(670)
=====
Dividends declared on common
stock....................... (6,464) (6,464)
-------- ------- ----- ------ --- -------
Balance at March 28, 1998..... $100,982 $20,819 $(219) $1,000 $10 $79,372
======== ======= ===== ====== === =======
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-44
<PAGE>
NORTH AMERICAN VAN LINES, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD DECEMBER 28, 1997 THROUGH MARCH 28, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<S> <C>
Cash flows from operating activities:
Loss from operations...................................... $ (650)
Adjustments to reconcile net loss to net cash provided by
operating activities:
Depreciation............................................ 2,256
Amortization of deferred agent contract costs........... 639
Provision for losses on accounts and notes receivable... 54
Deferred income taxes................................... 784
Gain on sale of equipment............................... (103)
Change in other comprehensive income (loss)............. (20)
Change in assets and liabilities:
Accounts and notes receivable......................... 9,475
Contracts receivable.................................. 1,110
Prepaids and other current assets..................... (489)
Accounts payable...................................... (499)
Other current liabilities............................. 903
Insurance reserves and accruals....................... (1,226)
Other long-term assets and liabilities................ (3,244)
Income tax payable.................................... 1,305
-------
Net cash provided by operating activities................... 10,295
-------
Cash flows from investing activities:
Additions of property and equipment....................... (1,402)
Proceeds from sale of property and equipment.............. 162
Payment of deferred agent contract costs.................. (2,166)
-------
Net cash used for investing activities...................... (3,406)
-------
Cash flows from financing activities:
Borrowings on revolving credit facility and notes
payable................................................. 244
Repayment of revolving credit facility and notes
payable................................................. (844)
Change in balance of outstanding checks................... (1,598)
Principal payments under capital lease obligation......... (20)
Minority interest......................................... 13
Collection of NS advance receivable....................... 10,204
Common dividends paid to NS............................... (6,464)
-------
Net cash provided by financing activities................... 1,535
-------
Net cash flows from continuing operations................... 8,424
Net cash flows from the payment or transfer of liabilities
attributable to discontinued operations................... (2,145)
-------
Net increase in cash and cash equivalents................... 6,279
Cash and cash equivalents at December 27, 1997.............. 2,948
-------
Cash and cash equivalents at March 28, 1998................. $ 9,227
=======
Supplemental disclosure of cash flow information--cash paid
during the period December 28, 1997 through March 28,
1998:
Interest.................................................. $ 140
Income taxes.............................................. $ 225
=======
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
F-45
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) BUSINESS DESCRIPTION AND ORGANIZATION
North American Van Lines, Inc. ("NAVL" or "the Company") is a diversified
motor carrier operating principally throughout the United States, Canada,
Germany, and the United Kingdom. NAVL's principal lines of business are
household goods moving which provide 48% of revenues and high value products
transportation and logistics services which provide 52% of revenues.
Approximately 94% of revenues are derived from operations in the United States
and Canada with 6% from operations in Europe. NAVL conducts operations primarily
through a network of exclusive agents with over 750 locations in the U.S. and
Canada and approximately 400 representatives on an international basis.
On January 9, 1998, NA Acquisition Corporation, a Delaware Corporation (NA
Acquisition) and a wholly-owned subsidiary of NA Holding Corporation, a Delaware
Corporation (NA Holding), agreed to acquire (the "Acquisition") all of the
capital stock of NAVL from Norfolk Southern Corporation (NS) and J.P. Morgan
Ventures Corporation (J.P. Morgan) for an aggregate purchase price of $222,135,
including fees and expenses of $13,600. NA Acquisition and NA Holding were
formed by Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands
exempted limited partnership (Fund V), and a private investment fund that is
managed by Clayton, Dubilier & Rice, Inc.
At the closing of the Acquisition (the "Closing") on March 29, 1998, NA
Acquisition purchased all of the issued and outstanding common stock of NAVL
from NS for an aggregate purchase price of $200,025, subject to pre- and
post-closing purchase price adjustment provisions based on changes in net
working capital between December 27, 1997, and closing, and all of the issued
and outstanding preferred stock of NAVL from J.P. Morgan for cash in the
aggregate amount of $1,000 plus all accrued and unpaid dividends through the
Closing of $18. Based on the purchase price adjustment provisions, $7,492 was
paid by NAVL to NS on August 26, 1998. After the Closing, NA Acquisition was
merged with and into NAVL, with NAVL being the surviving corporation and a
direct wholly-owned subsidiary of NA Holding.
The Acquisition of NAVL was financed through a combination of $150,000 in
senior secured debt and $65,000 in cash equity contributed by Fund V and NAVL
management investors. On March 30, 1998, the Company entered into a senior
secured credit facility (the "Credit Agreement") with several lenders including
The Bank of New York and Chase Manhattan Bank. The senior secured credit
facility is comprised of a seven year $45,000 term loan facility (Tranche A), an
eight year $100,000 term loan facility (Tranche B), and a seven year $85,000
revolving credit facility (Revolving Credit Facility). The purchase method of
accounting was used to record the Acquisition. Independent appraisals were used
where appropriate.
The Company includes a subsidiary which operates as a multiple-line property
and liability insurance company under the provisions of the insurance laws of
the State of Indiana and primarily insures owner-operators and agents of NAVL
against loss from certain risks, primarily physical damage to tractors and
straight trucks.
(b) BASIS OF CONSOLIDATION
The consolidated financial statements include the accounts of NAVL and its
subsidiaries, all but one of which are wholly owned. In June 1997 the Company
acquired a 51% share of a limited liability company (LLC), Manufacturing Support
Services, LLC (MSS). The financial statements include the results of MSS
F-46
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
and an appropriate recognition of minority interest is reflected in the
financial statements. All material intercompany accounts and transactions have
been eliminated in consolidation. The Consolidated Statement of Income includes
the results of operations for the period from December 28, 1997 through
March 28, 1998.
(c) CASH EQUIVALENTS
Cash equivalents are highly liquid investments purchased three months or
less from maturity.
(d) CONTRACTS RECEIVABLE AND EQUIPMENT HELD FOR SALE
In the normal course of business, the Company sells revenue equipment
(equipment held for sale) to its agents and to owner-operators under conditional
sales agreements (contracts receivable). Sales of revenue equipment are recorded
using the installment method of accounting. Gains are recognized as cash is
received and losses are recognized as incurred. Unrealized gains on these
transactions amounted to $3,752 at March 28, 1998, of which $1,793 is netted
against current portion of contracts receivable and $1,959 is netted against
long-term portion of contracts receivable. Equipment held for sale is recorded
at the lower of cost or net realizable value.
(e) SUPPLIES INVENTORY
Supplies inventory consists of replacement parts, tires and other items for
resale, supplies for revenue equipment and office supplies and is valued at the
lower of average cost or market value.
(f) INVESTMENTS
Investments consist of U.S. Treasury, corporate debt and equity securities.
The Company classifies its debt and equity securities in one of two categories:
available-for-sale, or held-to-maturity. Held-to-maturity securities are those
securities in which the Company has the ability and intent to hold the security
until maturity (primarily bonds). All other securities are classified as
available-for-sale.
Available-for-sale securities are recorded at fair value. Held-to-maturity
securities are recorded at amortized cost, adjusted for the amortization or
accretion of premiums or discounts. Unrealized holding gains and losses, net of
the related tax effect, on available-for-sale securities are excluded from
earnings and are reported as a separate component of other comprehensive income
until realized. Realized gains and losses from the sale of available-for-sale
securities are determined on a specific identification basis.
F-47
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(g) PROPERTY AND EQUIPMENT
Property and equipment are stated primarily at cost. Depreciation is
computed on a straight-line basis over the estimated useful lives of the
respective assets. The estimated useful lives and salvage values as of March 28,
1998 used in computing depreciation are summarized as follows:
<TABLE>
<CAPTION>
USEFUL LIFE SALVAGE VALUE
-------------- -------------
<S> <C> <C>
Buildings........................................ 20 to 40 years --
Trailers......................................... 15 years $2 per unit
Other Equipment.................................. 1 to 10 years 0-25%
</TABLE>
Repairs and maintenance expenditures are charged to expenses as incurred.
The amount of internally developed software that was capitalized during the
period December 28, 1997 through March 28, 1998 was $183 and is included in
Other Equipment.
(h) LONG-LIVED ASSETS
Long-lived assets used in the company's operations are reviewed for
impairment when circumstances indicate that the carrying amount of an asset may
not be recoverable. The primary indicators of recoverability are the associated
current and forecasted undiscounted operating cash flows.
(i) DEFERRED AGENT CONTRACT COSTS
Deferred agent contract costs are commitments made to agents for entering
into long-term contracts with NAVL. These commitments are capitalized and
amortized over the lives of the related contracts, which are generally 10 years.
(j) INSURANCE RESERVES AND ACCRUALS
The liability for the self-insured portion of cargo loss and damage,
workers' compensation and cargo claims is based on estimated amounts utilizing
primarily historical payment experience and a provision for claims incurred but
not reported. The Company's method of estimating costs relating to workers'
compensation, casualty, and cargo claims is based on actuarial valuations or
techniques.
Liability is limited, on a single occurrence basis, to $1,000 for workers'
compensation, and $5,000 for casualty claims. Claims in excess of these amounts
are covered by insurance.
Subsequent to the Acquisition, the Company sold its casualty and workers'
compensation liabilities for claims incurred in 1997 and prior to American
International Group (AIG) for $40,000 payable in three installments. The first
installment of $13,500 was paid in April of 1998 and the following two payments
will be made in 1999 and 2000. At the same time NAVL purchased first dollar
coverage for all insurance areas except cargo damage and delay claims. The
Company estimates costs relating to cargo damage and delay claims based on
actuarial methods.
F-48
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(k) REVENUE RECOGNITION
The Company recognizes estimated revenue and related transportation expense
on the date a shipment is picked up from the customer. The method of recognizing
revenue and expense for the motor carrier industry has been studied by the
Emerging Issues Task Force of the Financial Accounting Standards Board. The Task
Force reached a consensus that either (1) recognition of both revenue and direct
costs should be recorded when the shipment is completed or (2) allocation of
revenue between reporting periods based on relative transit time in each
reporting period with expenses recognized as incurred are acceptable methods of
recognizing revenue and expense for the motor carrier industry. A change to
either of the above methods by the Company would not have a material effect on
the Company's financial condition and results of operation.
Subsequent to the Acquisition, the Company recognizes estimated revenue and
related transportation expenses on the date a shipment is delivered or services
are completed. The estimate of revenue remains in a receivable account called
Delivered Not Processed (DNP) until the customer is invoiced. The estimated
Purchased Transportation Expenses (PTE) are not reversed until invoicing occurs
and actual expenses are recorded.
(l) FOREIGN CURRENCY TRANSLATION
The Company's foreign operations use the local currency as their functional
currency. Assets and liabilities of these operations are translated at the
exchange rates in effect on the balance sheet date. Income statement items are
translated at the average exchange rate for the period December 28, 1997 through
March 28, 1998. The impact of currency fluctuation is included in stockholders'
equity as accumulated other comprehensive income.
(m) INCOME TAXES
Income taxes are accounted for under the asset and liability method of
accounting. Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax laws
and tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. The effect on
deferred tax assets and liabilities due to a change in tax rates is recognized
in income in the period that includes the enactment date. In addition, the
amount of any future tax benefits are reduced by a valuation allowance to the
extent such benefits are not expected to be realized on a more likely than not
basis.
(n) USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. Some of the
areas where estimation is significant are as follows: LNP is the estimated
F-49
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
revenue associated with shipments loaded or services completed and not invoiced.
PTE is the associated purchased transportation expense that is estimated
corresponding to the LNP revenue. Accounts and notes receivable reserves for
doubtful accounts are estimates based on historical writeoff data to establish
the uncollectible portion of the receivables. Costs relating to cargo damage and
delay claims are estimated based on actuarial methods.
(2) RELATED PARTIES
The Company is charged or credited for transactions with NS. However, the
cost for administrative services performed by NS are not allocated to the
Company.
Certain software with a book value of $1,202 comprising the customized
option in logistics technology was dividended to NS prior to the close of
business on March 28, 1998. Additionally, certain assets and liabilities were
assumed by NS prior to the close of business on March 28, 1998, including:
- Intercompany accounts with NS.
- Obligation associated with discontinued operations.
- Current federal income tax liabilities and certain state income tax
liabilities, and related interest, with respect to returns consolidated
with and filed by NS.
(3) INVESTMENTS
Investments consist primarily of debt and equity securities held by the
company's insurance subsidiary. These marketable investment securities at
March 28, 1998 include:
<TABLE>
<CAPTION>
UNREALIZED
FAIR AMORTIZED HOLDING
VALUE COST GAINS
-------- --------- ----------
<S> <C> <C> <C>
Current
Available-for-sale........................................ $1,752 $1,121 $631
Held-to-maturity.......................................... 109 109 --
------ ------ ----
Total current............................................... $1,861 $1,230 $631
====== ====== ====
Noncurrent..................................................
Available-for-sale........................................ $ -- $ -- $ --
Held-to-maturity.......................................... 839 827 12
------ ------ ----
Total noncurrent.......................................... $ 839 $ 827 $ 12
====== ====== ====
</TABLE>
The market value of this portfolio includes gross unrealized gains of $631
at March 28, 1998.
In addition, investments of $234 at March 28, 1998 included noncurrent
investments in joint ventures and a workers' compensation imprest fund.
F-50
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(4) PREPAID EXPENSES
<TABLE>
<S> <C>
Prepaid expenses are comprised of the following:
Prepaid rent.............................................. $ 901
Prepaid systems maintenance............................... 813
Prepaid taxes and licenses................................ 882
Prepaid insurance......................................... 649
Other..................................................... 1,392
------
$4,637
======
</TABLE>
(5) OTHER ASSETS
<TABLE>
<S> <C>
Other assets consisted of the following:
Prepaid pension........................................... $ 76
Deposits.................................................. 453
Other..................................................... 326
----
$855
====
</TABLE>
(6) INCOME TAXES
(a) PROVISION FOR INCOME TAXES
Prior to its sale, NAVL was included in the consolidated federal income tax
return of NS. NAVL provides for federal income tax expense on a stand-alone
basis in accordance with the NS Tax Allocation Agreement. Tax expense or benefit
is recorded on a separate company basis whether or not such benefit would be
currently available on a separate company basis. In accordance with the NS Tax
Allocation Agreement, intercompany federal income tax accounts are recorded
between companies in the NS consolidated group. Generally, federal income taxes
are paid and settled through NS while state and foreign taxes are paid directly
to taxing authorities by NAVL.
NAVL files a consolidated federal income tax return with its wholly-owned
domestic subsidiaries.
F-51
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(6) INCOME TAXES (CONTINUED)
The provision for income taxes for the period December 28, 1997 through
March 28, 1998 includes:
<TABLE>
<S> <C>
Current:
Federal................................................... $(287)
Foreign................................................... 74
State..................................................... (167)
-----
Total current taxes......................................... (380)
-----
Deferred:
Federal................................................... (44)
State..................................................... (24)
-----
Total deferred taxes........................................ (68)
-----
Income tax benefit........................................ $(448)
=====
</TABLE>
(b) RECONCILIATION OF STATUTORY RATE TO EFFECTIVE RATE
Total income taxes as reflected in the Consolidated Statement of Income
differ from the amounts computed by applying the statutory federal corporate tax
rate as follows:
<TABLE>
<CAPTION>
AMOUNT PERCENT
-------- --------
<S> <C> <C>
Federal income tax at statutory rate........................ $(384) 35.0%
State income taxes, net of federal tax benefit.............. (124) 11.3
Other, net.................................................. 60 (5.5)
----- ----
Income tax benefit........................................ $(448) 40.8%
===== ====
</TABLE>
F-52
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(6) INCOME TAXES (CONTINUED)
(c) DEFERRED TAX ASSETS AND LIABILITIES
The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities at March 28,
1998 were as follows:
<TABLE>
<S> <C>
Deferred tax assets:
Reserves, including casualty and other claims............. $ 19,935
Employee benefits......................................... 12,105
Postretirement benefits other than pension and
postemployment benefits................................. 9,183
Foreign tax net operating loss carryforwards.............. 1,290
Other..................................................... 3,211
--------
Total gross deferred tax assets............................. 45,724
Less valuation allowance.................................... (924)
--------
Net deferred tax asset...................................... 44,800
--------
Deferred tax liabilities:
Property.................................................. (11,367)
Other..................................................... (2,669)
--------
Total gross deferred tax liabilities........................ (14,036)
--------
Net deferred tax assets..................................... 30,764
Less net current deferred tax assets........................ 21,899
--------
Net long-term deferred tax assets........................... $ 8,865
========
</TABLE>
At March 28, 1998, a valuation allowance has been established due to the
uncertainty of realization of foreign net operating loss (NOL) carryforwards.
The net change in the total valuation allowance for the period December 28, 1997
through March 28, 1998 was $0. Management believes all other deferred tax assets
will be realized based on the Company's anticipated future earnings or available
tax planning alternatives.
(d) TAXING AUTHORITY REVIEWS
Consolidated federal income tax returns of NS (which include NAVL) have been
examined and Revenue Agent Reports have been received for all years up to and
including 1994. The consolidated federal income tax returns of NS for 1995 and
1996 are being audited by the IRS. NS will indemnify NAVL for any tax
liabilities prior to the acquisition to the extent they were not accrued at the
purchase date.
F-53
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(7) OTHER CURRENT LIABILITIES
The components of other current liabilities are as follows:
<TABLE>
<S> <C>
Accrued agent and owner operator incentives................. $ 1,972
Accrued customer volume discounts........................... 1,074
Accrued interest............................................ 1,227
Accrued unvouchered payables................................ 4,803
Accrued other taxes......................................... 5,106
Deferred credits............................................ 761
Other....................................................... 384
-------
$15,327
=======
</TABLE>
(8) LEASE OBLIGATION
The Company's 51% owned subsidiary, Manufacturing Support Services, LLC
(MSS) has a capital lease agreement of $603 as of March 28, 1998 with Patriot
Rental. The Company's principal payments were $20 for the period December 28,
1997 through March 28, 1998. Future minimum lease commitments under the capital
lease are as follows: remainder of 1998, $62; 1999, $83; 2000, $92; 2001, $97;
2002, $102; and thereafter $163.
The Company had unused lines of credit of $2,642 at March 28, 1998.
(9) RETIREMENT, POSTRETIREMENT MEDICAL PLANS
The Company's United States plans' funded status and amount recognized in
the Company's consolidated financial statements at March 28, 1998 (based on
actuarial valuation) are as follows:
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
---------------- --------------
<S> <C> <C>
CHANGE IN BENEFIT OBLIGATION
Benefit obligation at December 27, 1997.......... $43,316 $14,176
Service cost..................................... 687 226
Interest cost.................................... 770 208
Plan participants' contribution.................. -- 5
Actuarial gain................................... (508) (2,431)
Benefits paid.................................... (539) (118)
------- -------
Benefit obligation at March 28, 1998........... $43,726 $12,066
======= =======
CHANGE IN PLAN ASSETS
Fair value of plan assets at December 27, 1997... $40,791
Actual return on plan assets..................... 2,906
Employer contribution............................ 314
Benefits paid.................................... (539)
-------
Fair value of plan assets at March 28, 1998.... $43,472
=======
</TABLE>
F-54
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(9) RETIREMENT, POSTRETIREMENT MEDICAL PLANS (CONTINUED)
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
---------------- --------------
<S> <C> <C>
Benefit obligation............................... $ 43,726 $ 12,066
Plan assets...................................... 43,472 --
-------- --------
Funded status.................................... (254) (12,066)
Unrecognized initial net obligation.............. 562 --
Unrecognized net actuarial loss.................. 3,917 781
Unrecognized prior service benefit............... (12,104) (8,615)
-------- --------
Accrued benefit cost............................. $ (7,879) $(19,900)
======== ========
WEIGHTED-AVERAGE ASSUMPTIONS
Discount rate.................................... 7.25% 7.25%
Expected return on plan assets................... 9.00%
Rate of compensation increase.................... 5.00%
</TABLE>
For measurement purposes, an 8% annual rate of increase in the per capita
cost of covered health care benefits was assumed for the period December 28,
1997 through March 28, 1998. The rate was assumed to decrease gradually to 5%
for 2004 and remain at that level thereafter.
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
---------------- --------------
<S> <C> <C>
COMPONENTS OF NET PERIODIC BENEFIT COST
Service cost..................................... $ 687 $ 226
Interest cost.................................... 770 208
Expected return on plan assets................... (826) --
Amortization of initial net obligation........... 51 --
Recognized net actuarial loss.................... 148 --
Amortization of prior service benefit............ (448) (312)
----- -----
Net periodic benefit cost........................ $ 382 $ 122
===== =====
</TABLE>
NAVL sponsors the NAVL, Inc. Employee Retirement Plan, a funded,
noncontributory defined benefit pension plan (Qualified Plan) covering eligible
employees in the United States. The Qualified Plan provides for eligible
employees to receive retirement benefits based principally on years of service
with the Company, compensation rates over that time, and estimated primary
Social Security benefits. Contributions to the Qualified Plan are made on the
basis of not less than minimum funding standards set forth in the Employee
Retirement Income Security Act of 1974, as amended. Plan assets consist
primarily of common stocks and government securities.
NAVL also has an Excess Benefit Plan which is an unfunded, nonqualified plan
that provides retirement benefits not otherwise provided under the Qualified
Plan because of the benefit limitations imposed by Section 415 and 401(a)(17) of
the Internal Revenue Code. The Excess Benefit Plan ensures that an executive
receives the total pension benefit to which he/she otherwise would be entitled,
were it not for such limitations.
F-55
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(9) RETIREMENT, POSTRETIREMENT MEDICAL PLANS (CONTINUED)
In addition, the Overlap Benefit Plan, an unfunded, nonqualified retirement
plan, provides retirement benefits forfeited by the highly compensated employees
under the Qualified Plan because of the changes to the retirement plan formula
which took effect April 18, 1989.
The Company has nonpension postretirement benefit plans that provide
specific health care and death benefits to eligible retired employees. Under the
present plans, which may be amended or terminated at NAVL's option, a defined
percentage of health care expenses is covered, after reductions for any
deductibles, co-payments, Medicare payments and, in some cases, coverage
provided by other group insurance policies. The cost of such health care
coverage to a retiree may be determined in part by a retiree's years of vested
service with NAVL prior to retirement. Death benefits are based on a fixed
amount at time of retirement.
Assumed health care cost trend rates have a significant effect on the
amounts reported for the health care plans. A one-percentage-point change in
assumed health care cost trend rates would have the following effects:
<TABLE>
<CAPTION>
1-PERCENTAGE-POINT 1-PERCENTAGE-POINT
INCREASE DECREASE
------------------ ------------------
<S> <C> <C>
Effect on total of service and interest cost
components................................. $ 85 $ (70)
Effect on postretirement benefit
obligation................................. 1,412 (2,126)
</TABLE>
The Company's German subsidiary, midiData, has an unfunded pension plan
under which certain employees of the company will receive certain percentages of
their monthly income when they retire. At December 27, 1997, the accumulated
benefit obligation was $1,595 and the projected benefit obligation was $1,668.
The remaining transition obligation at December 27, 1997 of $243 is being
amortized over the remaining average service life of 10 years.
The Company's Canadian subsidiary, North American Van Lines Canada Ltd., has
a defined benefit plan with the benefits generally based upon years of service
and the highest five-year average salary during employment. At December 27, 1997
the actuarial present value of accrued pension benefits was $1,285 and the
aggregate market value of pension plan assets was $1,686.
In 1994, the Company's United Kingdom subsidiary, North American Van Lines,
Ltd., established a contributory defined contribution plan for eligible
employees. The plan is funded through contributions from employees, generally 3%
of earnings, that are matched by the Company.
The Company maintains an employee savings plan for eligible employees which
qualifies under Sections 401(a) and 401(k) of the Internal Revenue Code. The
Company has made no contributions to the plan since its inception.
(10) POSTEMPLOYMENT MEDICAL PLAN
NAVL provides certain postemployment benefits to inactive employees and
their dependents during the period following employment but before retirement.
Effective the beginning of 1994, the Company adopted FAS No. 112 which requires
the accrual of the cost of postemployment benefits rather than
F-56
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(10) POSTEMPLOYMENT MEDICAL PLAN (CONTINUED)
expensing the costs when paid. These benefits are for continuation of health
care coverage. At March 28, 1998, the accumulated postemployment benefit
obligation was $2,158.
(11) INCENTIVE AND DEFERRED COMPENSATION
The Company maintains a Management Incentive Plan for certain executives and
key management employees. The plan is administered by the Board of Directors who
do not participate in the plan. Incentive compensation is based upon achievement
of certain predetermined corporate performance goals.
The Company also maintains Evidence of Success incentive programs for
eligible employees not included in the Management Incentive Plan. The plan is
administered by the Vice President Human Resources, who does not participate in
the plan. Incentive compensation is based upon achievement of certain
predetermined corporate performance goals. The expense associated with the
incentive plans was $1,108 for the period December 28, 1997 through March 28,
1998.
(12) COMMITMENTS AND CONTINGENCIES
(a) LETTERS OF CREDIT AND DEBT GUARANTEES
In connection with its insurance agreements, at March 28, 1998, the Company
had outstanding letters of credit of $10,719, of which $8,000 was
unconditionally guaranteed by NS. None of these letters of credit have been
utilized. At March 28, 1998, the Company was contingently liable as guarantors
with respect to $2,318.
The Company's German subsidiary, midiData, has guarantees to WTB Leasing
GmbH and CommerzLease for equipment leases. These leases extend through the year
2003. The Company's United Kingdom subsidiary, North American Van Lines, Ltd.,
has guarantees to various parties for customs and excise taxes.
(b) LAWSUITS
The Company and certain subsidiaries are defendants in numerous lawsuits
relating principally to motor carrier operations. While the final outcome of
these lawsuits cannot be predicted with certainty, it is the opinion of
management, after consulting with its legal counsel, that the amount of NAVL's
ultimate liability will not materially affect NAVL's consolidated financial
position, results of operations or liquidity.
(c) ENVIRONMENTAL MATTERS
The Company has been named as a potentially responsible party (PRP) in two
environmental cleanup proceedings by federal or state authorities and one
additional environmental clean-up proceeding by a group of PRP's. The suits are
brought under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, or other federal or state statutes. Based on
all known information, it is estimated that the settlement cost of each PRP site
would not be materially or significantly larger than the litigation reserves
established, which totaled $57 on March 28, 1998. It is possible that additional
claims or lawsuits involving unknown environmental matters or now unidentified
environmental sites may arise in the future.
F-57
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(12) COMMITMENTS AND CONTINGENCIES (CONTINUED)
The Company owns or has owned and leases or has leased facilities at which
underground storage tanks for diesel fuel are located and operated. Management
believes that the Company has taken the appropriate and necessary action with
regard to releases of diesel fuel that have occurred. As conditions may exist on
these properties related to environmental problems that are latent or
undisclosed, there can be no assurance that the Company will not incur
liabilities or costs, the amount of which cannot be estimated reliably at this
time. However, based on its assessment of the facts and circumstances now known
and after consulting with its legal counsel, management believes that it has
recorded appropriate estimates of liability for those environmental matters of
which the Company is aware. Further, management believes it is unlikely that any
identified matters, either individually or in aggregate, will have a material
effect on the Company's financial position, results of operations or liquidity.
(13) LEASE COMMITMENTS
The Company has noncancelable lease commitments under operating leases for
rental of office space, warehouse facilities, and office equipment. The
Company's rental expense under these operating leases was $4,035 for the period
December 28, 1997 through March 28, 1998. Future minimum lease commitments under
noncancelable leases are as follows: remainder of 1998, $10,924; 1999, $13,375;
2000, $10,394; 2001, $8,245; 2002, $6,406; 2003, $2,626, and thereafter $6,693.
(14) PREFERRED STOCK (PER SHARE AMOUNTS IN WHOLE DOLLARS)
There are 10,000 shares of $100 par value series A (nonvoting) preferred
stock authorized, issued, and outstanding. Holders of preferred stock are
entitled to receive cumulative dividends at the annual rate of $7 per share,
payable in arrears, on a quarterly basis. If the required dividend payment for
any quarter is not paid in full within five business days after the end of such
quarter, the annual rate of dividends on the preferred stock increases to $9 per
share for the period from the end of such quarter to the date when payment of
all dividends is fully current. The fixed liquidation price for each share of
preferred stock is its par value, plus an amount equal to all dividends, whether
or not declared, that are accrued and unpaid to the date of payment of the
liquidation price.
(15) FINANCIAL INSTRUMENTS
The Company utilizes foreign exchange contracts to manage foreign currency
exposures. The principal objective of such contracts is to minimize the risks
and/or costs associated with international operating activities. The Company
does not utilize financial instruments for trading or other speculative
purposes. The counterparties to these contractual arrangements are financial
institutions with which the Company also has other financial relationships. The
Company is exposed to credit loss in the event of nonperformance by these
counterparties. However, the Company does not anticipate nonperformance by the
other parties, and no material loss would be expected from their nonperformance.
The Company enters into forward currency exchange contracts in the regular
course of business to manage its exposure against foreign currency fluctuations
on transactions denominated in foreign currencies. The Company had no open
positions on forward exchange contracts at March 28, 1998.
F-58
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(16) OPERATING SEGMENTS
The Company has two reportable segments--Van Line Network and Logistics
Services.
The Van Line Network segment provides domestic and international residential
relocation services through a network of exclusive agents. It is comprised of
the Relocation Services Division, which provides packing, loading,
transportation, delivery and warehousing services for any type of household move
in the U.S. and Canada, and the International Division, which provides or
coordinates these same services for customers on a global basis.
The Logistics Services segment provides customized logistics solutions,
specialized transportation services, warehousing, distribution, and delivery
services to commercial customers. It is comprised of the Logistics Division,
which provides these specialized services to principally electronics, medical
equipment and other suppliers of sensitive goods requiring specialized handling
in the U.S., the Blanket Wrap/Flatbed Division, which provides transportation of
truckload freight requiring specialized handling in the U.S., and the Europe
Division, which provides these same logistics services in Europe and the U.K.
The table below represents information about revenues, income from
operations and total assets by segment used by the chief decision-makers of the
Company for the period December 28, 1997 through March 28, 1998 and as of
March 28, 1998:
<TABLE>
<CAPTION>
VAN LINE LOGISTICS CONSOLIDATED
NETWORK SERVICES CORPORATE(1) TOTALS
-------- --------- ------------ ------------
<S> <C> <C> <C> <C>
Revenues.......................... $99,687 $107,558 $ -- $207,245
Income from Operations............ (2,656) 1,321 -- (1,335)
Total Assets...................... 95,317 102,973 86,024 284,314
</TABLE>
- ------------------------
(1) Total assets by segment are specific assets such as revenue equipment and
trade receivables. Assets included in the corporate category include
non-allocated assets such as the corporate headquarters building, computer
hardware and software, contracts receivable associated with equipment sales
and deferred taxes.
Specified items included in segment results for the period December 28, 1997
through March 28, 1998:
<TABLE>
<CAPTION>
VAN LINE LOGISTICS CONSOLIDATED
NETWORK SERVICES CORPORATE(2) TOTALS
-------- --------- ------------ ------------
<S> <C> <C> <C> <C>
Depreciation and amortization..... $ 1,154 $ 1,741 $ -- $2,895
Non-operating income (expense) and
minority interest............... 23 (26) -- (3)
</TABLE>
- ------------------------
(2) Depreciation expense for capital expenditures in the corporate category is
allocated to the segments in order to determine segment income from
operations.
F-59
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(16) OPERATING SEGMENTS (CONTINUED)
Specified items included in segment assets of March 28, 1998:
<TABLE>
<CAPTION>
VAN LINE LOGISTICS CONSOLIDATED
NETWORK SERVICES CORPORATE TOTALS
-------- --------- --------- ------------
<S> <C> <C> <C> <C>
Capital expenditures.................. $61 $327 $1,014 $1,402
</TABLE>
Revenue and long-lived asset information by geographic area for the period
December 28, 1997 through March 28, 1998 and as of March 28, 1998:
<TABLE>
<CAPTION>
LONG-LIVED
REVENUE ASSETS
-------- ----------
<S> <C> <C>
United States........................................... $190,542 $83,667
Foreign................................................. 16,703 3,577
-------- -------
Total................................................... $207,245 $87,244
======== =======
</TABLE>
Foreign revenue is based on the country in which the sales originated.
(17) SUPPLEMENTAL INFORMATION
On November 19, 1999, pursuant to an acquisition agreement dated
September 14, 1999, the Company acquired substantially all of the assets of
certain subsidiaries of NFC, plc. (the "Seller") that are engaged in the
Seller's moving services business. The acquisition was accounted for as a
purchase. Total purchase consideration was $400 million cash plus a combination
of preferred stock, common stock and common stock warrants with a combined value
of $50 million.
The acquisition was funded through borrowings under new credit facilities of
$390.0 million, proceeds from the issuance of $150.0 million of NAVL senior
subordinated notes, and an increase to stockholders' equity resulting from the
issuance of $24.5 million of junior preferred stock, $35.0 million of senior
discounted notes, and a common stock warrant totalling $65.5 million by NAVL's
parent, NA Holding. Of the $65.5 million, $40.0 million was initially in the
form of an interim loan facility made available to NA Holding. On December 1,
1999, Fund V and the Seller subscribed for and purchased additional shares of
common stock of NA Holding for $32.0 million and $8.0 million in cash,
respectively. The proceeds from this stock subscription were used to repay the
$40.0 million interim loan.
The following summarized consolidating balance sheet, statement of income,
and statement of cash flows have been presented in contemplation of the
transaction between NA Holding and the Seller, as described above. Such
financial statements have been segregated between those entities that have
guaranteed the NAVL senior subordinated notes issued in connection with the
transaction ("Guarantor" entities), and those entities that did not guarantee
such debt ("Non-guarantor" entities).
F-60
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(17) SUPPLEMENTAL INFORMATION (CONTINUED)
Consolidating balance sheet data as of March 28, 1998 is summarized as
follows:
<TABLE>
<CAPTION>
(1) (2) NON- TOTAL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Current assets........................ $150,560 $20,083 $19,239 $ (1,677) $188,205
Non-current assets.................... 119,134 264 21,709 (44,998) 96,109
-------- ------- ------- -------- --------
Total assets.......................... $269,694 $20,347 $40,948 $(46,675) $284,314
======== ======= ======= ======== ========
Current liabilities................... $106,973 $ 5,664 $13,708 $ (1,387) $124,958
Non-current liabilities............... 61,739 4,111 12,897 (20,373) 58,374
-------- ------- ------- -------- --------
Total liabilities..................... 168,712 9,775 26,605 (21,760) 183,332
Stockholders' equity.................. 100,982 10,572 14,343 (24,915) 100,982
-------- ------- ------- -------- --------
Total liabilities and equity.......... $269,694 $20,347 $40,948 $(46,675) $284,314
======== ======= ======= ======== ========
</TABLE>
Consolidating statement of income data for the period December 28, 1997
through March 28, 1998 is summarized as follows:
<TABLE>
<CAPTION>
(1) (2) NON- TOTAL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Operating revenues.................... $176,274 $14,594 $19,466 $ (3,089) $207,245
Total operating expenses.............. 178,212 13,617 19,462 (2,711) 208,580
-------- ------- ------- -------- --------
Income (loss) from operations......... (1,938) 977 4 (378) (1,335)
Interest expense and other............ (840) -- 988 (385) (237)
-------- ------- ------- -------- --------
Income (loss) before income taxes..... (1,098) 977 (984) 7 (1,098)
Provision/(benefit) for income
taxes............................... (448) 399 (402) 3 (448)
-------- ------- ------- -------- --------
Net income (loss)..................... $ (650) $ 578 $ (582) $ 4 $ (650)
======== ======= ======= ======== ========
</TABLE>
Income taxes have been calculated for purposes of this footnote based on an
assumed consolidated effective rate of 40.8%.
F-61
<PAGE>
NORTH AMERICAN VAN LINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 28, 1998
(DOLLARS IN THOUSANDS)
(17) SUPPLEMENTAL INFORMATION (CONTINUED)
Consolidating statement of cash flows data for the period December 28, 1997
through March 28, 1998 is summarized as follows:
<TABLE>
<CAPTION>
(1) (2) NON- TOTAL
PARENT GUARANTORS GUARANTORS ELIMINATIONS COMBINED
-------- ---------- ---------- ------------ --------
<S> <C> <C> <C> <C> <C>
Net cash provided by operating
activities............................ $ 7,968 $ 302 $ 2,025 $ -- $ 10,295
Net cash provided by (used in) investing
activities............................ (3,445) -- 39 -- (3,406)
Net cash provided (used in) financing
activities............................ 2,762 (217) (1,010) -- 1,535
-------- ------- ------- -------- --------
Net cash flows from continuing
operations............................ 7,285 85 1,054 -- 8,424
Net cash flows from the payment of
liabilities attributable to
discontinued operations............... (2,145) -- -- -- (2,145)
Net increase in cash and cash
equivalents........................... 5,140 85 1,054 -- 6,279
-------- ------- ------- -------- --------
Cash at beginning of period............. 612 (58) 2,394 -- 2,948
-------- ------- ------- -------- --------
Cash at end of period................... $ 5,752 $ 27 $ 3,448 $ -- $ 9,227
======== ======= ======= ======== ========
</TABLE>
- ------------------------
(1) Parent includes the accounts of North American Van Lines, Inc., a Delaware
corporation and the issuer of the debt in connection with the transaction.
(2) Total Guarantors include the accounts of the following subsidiaries of North
American Van Lines, Inc., Fleet Insurance Management, Inc., an Indiana
corporation; FrontRunner Worldwide, Inc., a Delaware corporation; NACAL,
Inc., a California corporation; NAVTRANS International Freight Forwarding,
Inc., an Indiana corporation; North American Distribution Systems, Inc., an
Indiana corporation; North American Logistics, Ltd., an Indiana corporation;
North American Van Lines of Texas, Inc., a Texas corporation; Relocation
Management Systems, Inc., a Delaware corporation; and Great Falls North
American, Inc., a Montana corporation. Each Guarantor is a wholly owned
subsidiary of North American Van Lines, Inc. and will jointly and severally,
irrevocably and fully and unconditionally guarantee the punctual payment of
such debt issued in connection with the transaction.
F-62
<PAGE>
[LOGO]
2100 Dominion Tower
999 Waterside Drive
Norfolk, VA 23510
INDEPENDENT AUDITORS' REPORT
The Board of Directors
North American Van Lines, Inc.:
We have audited the accompanying consolidated balance sheets of North
American Van Lines, Inc. and subsidiaries (the Company) as of December 27, 1997
and December 28, 1996, and the related consolidated statements of income,
changes in stockholders' equity and cash flows for the years then ended. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of North
American Van Lines, Inc. and subsidiaries as of December 27, 1997 and
December 28, 1996, and the results of their operations and their cash flows for
the years then ended in conformity with generally accepted accounting
principles.
/s/ KPMG LLP
January 21, 1998, except as to Note 17,
for which the date is November 19, 1999
F-63
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 2,948 1,867
Short-term investments.................................... 1,609 2,103
Accounts and notes receivable, net of allowance for
doubtful accounts of $12,415 and $12,706................ 148,581 149,987
Current portion of contracts receivables, net of valuation
allowance of $224 and $139.............................. 6,359 5,896
Supplies inventory........................................ 1,904 1,782
Equipment held for sale................................... 2,532 2,675
Current portion of deferred agent contract costs.......... 2,601 1,814
Prepaids and other current assets......................... 3,699 3,435
Deferred income taxes..................................... 22,644 26,086
-------- --------
Total current assets........................................ 192,877 195,645
-------- --------
Long-term portion of contracts receivable................... 11,160 7,955
Long-term portion of notes receivable....................... 2,559 1,221
Investments................................................. 1,053 1,830
Advances to parent.......................................... 10,204 4,102
Deferred income taxes....................................... 8,904 9,570
Property and equipment:
Land...................................................... 1,743 1,960
Buildings................................................. 27,165 27,714
Trailers.................................................. 75,064 74,486
Other equipment........................................... 81,595 77,439
-------- --------
185,567 181,599
Less accumulated depreciation............................. 127,800 124,491
-------- --------
57,767 57,108
Deferred agent contract costs............................... 16,924 9,324
Other assets................................................ 887 503
-------- --------
Total assets................................................ $302,335 287,258
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
F-64
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.......................................... $ 32,518 30,530
Accrued transportation expense............................ 31,242 35,688
Other current liabilities................................. 21,928 24,023
Casualty and other claims................................. 25,721 26,354
Compensation and benefits................................. 15,858 11,637
Income taxes.............................................. 2,772 6,524
Accrued liabilities attributable to discontinued
operations.............................................. 838 5,046
-------- --------
Total current liabilities................................... 130,877 139,802
Income taxes payable to parent.............................. 2,708 118
Casualty and other claims................................... 28,107 26,053
Benefits and other liabilities.............................. 30,982 32,574
Accrued liabilities attributable to discontinued
operations................................................ 1,307 2,595
Minority interest........................................... 238 --
-------- --------
Total liabilities........................................... 194,219 201,142
-------- --------
Stockholders' equity:
Preferred stock, $100.00 par value, 10,000 shares
authorized, issued, and outstanding..................... 1,000 1,000
Common stock, $1.00 par value, 10,000 shares authorized,
issued, and outstanding................................. 10 10
Additional paid-in capital................................ 79,372 79,372
Retained income........................................... 27,933 5,681
Accumulated other comprehensive income (loss)............. (199) 53
-------- --------
Total stockholders' equity.................................. 108,116 86,116
-------- --------
Total liabilities and stockholders' equity.................. $302,335 287,258
======== ========
</TABLE>
F-65
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED STATEMENTS OF INCOME
YEARS ENDED DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
Operating revenues.......................................... $941,501 930,248
Operating expenses:
Transportation............................................ 740,891 732,934
Administration............................................ 119,306 108,652
Casualty and other claims................................. 27,705 36,422
Maintenance, tires, and other operating................... 18,500 19,388
Depreciation and amortization............................. 12,467 12,735
Equipment sales and services.............................. (4,960) (4,677)
Insurance and supply programs............................. (3,571) (3,273)
-------- --------
Total operating expenses.................................... 910,338 902,181
-------- --------
Income from operations...................................... 31,163 28,067
Other income (expense):
Interest income........................................... 1,408 917
Interest expense.......................................... (602) (1,768)
Minority interest......................................... (89) --
-------- --------
Income before income taxes.................................. 31,880 27,216
Provision for income taxes.................................. 11,864 12,156
-------- --------
Income from continuing operations........................... 20,016 15,060
Discontinued operations--credit (less applicable income
taxes of $1,494 and $1,600)............................... 2,306 2,470
-------- --------
Net income.................................................. 22,322 17,530
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
F-66
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
YEARS ENDED DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
ACCUMULATED
OTHER ADDITIONAL
COMPREHENSIVE RETAINED COMPREHENSIVE PREFERRED COMMON PAID IN
TOTAL INCOME EARNINGS INCOME (LOSS) STOCK STOCK CAPITAL
-------- -------------- -------- ------------- --------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at December 30, 1995...... $103,639 23,404 (147) 1,000 10 79,372
Comprehensive income
Net income...................... 17,530 17,530 17,530
Gross unrealized holding
gains......................... 165 165
Foreign currency translation.... 35 35
------
Other comprehensive income...... 200 200
Comprehensive income.............. 17,730
======
Dividends paid on common stock.... (35,183) (35,183)
Dividends paid on preferred
stock........................... (70) (70)
-------- ------- ---- ----- --- ------
Balance At December 28, 1996...... $ 86,116 5,681 53 1,000 10 79,372
Comprehensive income
Net income...................... 22,322 22,322 22,322
Gross unrealized holding
gains......................... (84) (84)
Foreign currency translation.... (168) (168)
------
Other comprehensive loss........ (252) (252)
Comprehensive income.............. 22,070
======
Dividends paid on preferred
stock........................... (70) (70)
-------- ------- ---- ----- --- ------
Balance at December 27, 1997...... $108,116 27,933 (199) 1,000 10 79,372
======== ======= ==== ===== === ======
</TABLE>
See accompanying notes to consolidated financial statements.
F-67
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
Continuing operations:
Cash flows from operating activities:
Income from continuing operations....................... $ 20,016 15,060
Adjustments to reconcile income from continuing
operations to net cash provided by operating
activities:
Depreciation and amortization......................... 12,467 12,735
Deferred income taxes................................. 2,614 3,620
Gain on sale of equipment............................. (677) (156)
Change in assets and liabilities:
Accounts and notes receivable....................... 68 (648)
Prepaids and other current assets................... (243) 4,146
Contracts receivable................................ (3,668) 1,996
Accounts payable.................................... 1,988 (1,675)
Other current liabilities........................... (6,072) (1,823)
Casualty and other claims........................... 1,421 3,440
Other long-term assets and liabilities.............. 1,014 2,979
-------- --------
Net cash provided by operating activities................... 28,928 39,674
-------- --------
Cash flows from investing activities:
Additions of property and equipment..................... (10,588) (7,445)
Proceeds from sale of property and equipment............ 1,466 1,124
Investment purchases and other (including joint
ventures)............................................. (4,001) (2,128)
Investment sales and other.............................. 4,872 2,890
Deferred agent contract costs........................... (11,714) (2,680)
-------- --------
Net cash used for investing activities...................... (19,965) (8,239)
-------- --------
Cash flows from financing activities:
Decrease (increase) in advances to parent............... (6,102) 4,284
Common dividends paid................................... -- (35,183)
Preferred dividends paid................................ (70) (70)
-------- --------
Net cash used for financing activities...................... (6,172) (30,969)
-------- --------
Effect of cumulative translation adjustment............... (168) 35
Minority interest......................................... 238 --
Unrealized investment gains (net of deferred taxes)....... (84) 165
-------- --------
Net cash flows from continuing operations................... 2,777 666
Net cash flows from the payment of liabilities attributable
to discontinued operations................................ (1,696) (1,107)
-------- --------
Net increase (decrease) in cash and cash equivalents........ 1,081 (441)
Cash and cash equivalents at beginning of year.............. 1,867 2,308
-------- --------
Cash and cash equivalents at end of year.................... $ 2,948 1,867
======== ========
Supplemental disclosure of cash flow information--cash paid
during the year for:
Interest.................................................. $ 1,118 341
Income taxes paid to parent............................... 8,946 6,481
Income taxes paid to governmental authorities............. 1,233 607
</TABLE>
See accompanying notes to consolidated financial statements.
F-68
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) ORGANIZATION/CONCENTRATION OF RISK
North American Van Lines, Inc. (NAVL or the Company) is a diversified motor
carrier operating principally throughout the United States, Canada, Germany, and
the United Kingdom. NAVL's principal lines of business are household goods
moving and high value products transportation which provide 55% and 45% of
revenues, respectively. Approximately 95% of revenues are derived from
operations in the United States and Canada with 5% from operations in Europe.
NAVL conducts operations primarily through a network of 388 agents with 620
locations in the United States. During 1997, NAVL renewed long-term contracts
with agents whose revenues approximate 16% of total revenues and had agents
whose revenues approximate 9% of total revenues not renew their contracts.
During 1998, NAVL will be negotiating renewal contracts with agents
approximating 1% of total revenues. NAVL is a subsidiary of Norfolk Southern
Corporation (NS). All of the common stock of NAVL is owned by NS. See note 16
for information regarding subsequent event.
The Company was formed on December 31, 1993, when NS contributed the assets
and liabilities of certain trucking businesses previously held by a predecessor
corporation to the Company. The assets and liabilities included those of certain
discontinued operations of the predecessor adjusted to estimated realizable
value and substantially all of which have been liquidated by the Company. For
financial reporting purposes the contribution of assets and liabilities from NS
was recorded at the historical cost of such assets and liabilities. Common stock
and additional paid-in capital were recorded at the net amount.
The Company includes a subsidiary which operates as a multiple-line property
and liability insurance company under the provisions of the insurance laws of
the State of Indiana and insures owner-operators and agents of NAVL against loss
from certain risks, primarily physical damage to tractors and straight trucks.
(b) BASIS OF CONSOLIDATION
The consolidated financial statements include the accounts of NAVL and its
subsidiaries, all but one of which are wholly owned. In June 1997, the Company
acquired a 51% share of a limited liability company (LLC), Manufacturing Support
Services LLC, (MSS). The financial statements include the results of MSS and the
minority interest is reflected in long-term liabilities. All material
intercompany accounts and transactions have been eliminated in consolidation.
(c) CASH EQUIVALENTS
Cash equivalents are highly liquid investments purchased three months or
less from maturity.
(d) CONTRACTS RECEIVABLE AND EQUIPMENT HELD FOR SALE
In the normal course of business, the Company sells revenue equipment
(equipment held for sale) to its agents and to owner-operators under conditional
sales agreements (contracts receivable). Sales of revenue equipment are recorded
using the installment method of accounting. Gains are recognized as cash is
received and losses are recognized as incurred. Unrealized gains on these
transactions amounted to
F-69
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
$3,684 and $3,773 at December 27, 1997 and December 28, 1996, respectively, of
which $1,752 and $1,958, respectively, are netted against current portion of
contracts receivable and $1,932 and $1,815, respectively, are netted against
long-term portion of contracts receivable. Equipment held for sale is recorded
at the lower of cost or net realizable value.
(e) SUPPLIES INVENTORY
Supplies inventory consists of replacement parts, tires and other items for
resale, supplies for revenue equipment, and office supplies and is valued at the
lower of average cost or net realizable value.
(f) TIRES IN SERVICE
In 1995, the Company recognized a change in accounting related to tires in
service. Effective July 1, 1995, all tires in service were expensed as purchased
and the remaining balance as of July 1, 1995 was amortized over a 12-month
period from that date. Because of this change, maintenance, tires, and other
operating expense was increased $1,193 in 1996.
Replacement tires are charged to expense when purchased.
(g) INVESTMENTS
Investments consist of U.S. Treasury, corporate debt, and equity securities.
The Company classifies its debt and equity securities in one of two categories:
available-for-sale or held-to-maturity. Held-to-maturity securities are those
securities in which the Company has the ability and intent to hold the security
until maturity (primarily bonds). All other securities are classified as
available for sale.
Available-for-sale securities are recorded at fair value. Held-to-maturity
securities are recorded at amortized cost, adjusted for the amortization or
accretion of premiums or discounts. Unrealized holding gains and losses, net of
the related tax effect, on available-for-sale securities are excluded from
earnings and are reported as a separate component of stockholders' equity until
realized. Realized gains and losses from the sale of available-for-sale
securities are determined on a specific identification basis.
(h) PROPERTY AND EQUIPMENT
Property and equipment are stated primarily at cost. Depreciation is
computed on a straight-line basis over the estimated useful lives of the
respective assets. The estimated useful lives and salvage values as of
December 27, 1997 used in computing depreciation are summarized as follows:
<TABLE>
<CAPTION>
USEFUL LIFE SALVAGE VALUE
-------------- -------------
<S> <C> <C>
Buildings........................................ 20 to 40 years --
Trailers......................................... 15 years $2
Other equipment.................................. 1 to 10 years 0-25%
</TABLE>
Repairs and maintenance expenditures are charged to expenses as incurred.
F-70
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
A change in policy regarding the capitalization of software developed for
internal use was made effective in 1996. The amount that was capitalized in 1997
and in 1996 was $723 and $687, respectively, and is included in other equipment.
(i) DEFERRED CONTRACT COSTS
Included in deferred contract costs are commitments made to agents for
entering into long-term contracts with NAVL. These commitments are capitalized
and amortized over the lives of the related contracts, generally 10 years. The
portions of the commitments to be amortized over the next 12 months are
classified as current assets. Unpaid commitments are included in either
short-term or long-term liabilities.
(j) CASUALTY AND OTHER CLAIMS
The liability for the self-insured portion of casualty, workers'
compensation and cargo claims is based on estimated amounts primarily utilizing
historical payment experience and a provision for claims incurred but not
reported. The Company's method of estimating costs relating to casualty,
workers' compensation and cargo claims is based on actuarial valuations or
techniques.
Liability is limited, on a single occurrence basis, to $1,000 for workers'
compensation, and $5,000 for casualty claims. Claims in excess of these amounts
are covered by insurance.
(k) REVENUE RECOGNITION
The Company recognizes estimated revenue and related transportation expense
on the date a shipment is picked up from the customer. The method of recognizing
revenue and expense for the motor carrier industry has been studied by the
Emerging Issues Task Force of the Financial Accounting Standards Board. The Task
Force reached a consensus that either (1) recognition of both revenue and direct
costs should be recorded when the shipment is completed or (2) allocation of
revenue between reporting periods based on relative transit time in each
reporting period with expenses recognized as incurred are acceptable methods of
recognizing revenue and expense for the motor carrier industry. A change to
either of the above methods by the Company would not have a material effect on
the Company's financial condition and results of operation.
The Company has historically reported freight forwarding and accessorial
revenues net of related expenses. In 1997, the Company changed its presentation
of revenues and expenses from a net to a gross basis. This change in
presentation does not affect income from operations. The 1996 income statement
has been reclassified to conform with the 1997 presentation.
(l) FOREIGN CURRENCY TRANSLATION
Certain foreign exchange unrealized gains and losses are charged directly to
stockholders' equity in the cumulative translation adjustment account.
F-71
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(m) INCOME TAXES
Income taxes are accounted for under the asset and liability method of
accounting. Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax laws
and tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. The effect on
deferred tax assets and liabilities due to a change in tax rates is recognized
in income in the period that includes the enactment date.
(n) USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
(o) RECLASSIFICATIONS
Certain 1996 amounts have been reclassified to conform with the 1997
presentation.
(2) RELATED PARTIES
The Company is charged or credited for transactions with NS. However, the
cost for administrative services performed by NS are not allocated to the
Company. The balances reflected in advances to parent are not subject to any
specific repayment terms. The receivable is periodically repaid by means of a
dividend to NS. NAVL paid dividends of $-0- and $35,183 to NS in 1997 and 1996,
respectively.
F-72
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(3) INVESTMENTS
Investments consist primarily of debt and equity securities held by the
company's insurance subsidiary. These marketable investment securities at
December 27, 1997 and December 28, 1996 include:
<TABLE>
<CAPTION>
1997 1996
--------------------------------- -------------------------------------
UNREALIZED UNREALIZED
FAIR AMORTIZED HOLDING FAIR AMORTIZED HOLDING
VALUE COST GAINS VALUE COST GAINS (LOSSES)
-------- --------- ---------- -------- --------- --------------
<S> <C> <C> <C> <C> <C> <C>
Current:
Available-for-sale.................. $1,501 1,019 482 1,902 1,279 623
Held-to-maturity.................... 108 108 -- 201 201 --
------ ----- --- ----- ----- ---
Total current......................... $1,609 1,127 482 2,103 1,480 623
====== ===== === ===== ===== ===
Noncurrent:
Available-for-sale.................. -- -- -- -- -- --
Held-to-maturity.................... 841 832 9 1,631 1,638 (7)
------ ----- --- ----- ----- ---
Total noncurrent...................... $ 841 832 9 1,631 1,638 (7)
====== ===== === ===== ===== ===
</TABLE>
The market value of this portfolio includes gross unrealized gains of $482
and $623 in 1997 and 1996, respectively.
In addition, investments of $221 and $192 at December 27, 1997 and
December 28, 1996, respectively, included noncurrent investments in joint
ventures and a workers' compensation imprest fund.
(4) INCOME TAXES
(a) PROVISION FOR INCOME TAXES
NAVL is included in the consolidated federal income tax return of NS. NAVL
provides for federal income tax expense on a stand-alone basis in accordance
with the NS Tax Allocation Agreement. Tax expense or benefit is recorded on a
separate company basis whether or not such benefit would be currently available
on a separate company basis. In accordance with the NS Tax Allocation Agreement,
intercompany federal income tax accounts are recorded between companies in the
NS consolidated group. Generally, federal income taxes are paid and settled
through NS while state and foreign taxes are paid directly to taxing authorities
by NAVL.
F-73
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(4) INCOME TAXES (CONTINUED)
The 1997 and 1996 provision for income taxes for continuing operations
includes:
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
Current:
Federal.................................................. $ 6,935 5,841
Foreign.................................................. 689 1,517
State.................................................... 1,626 1,178
------- ------
Total current taxes........................................ 9,250 8,536
------- ------
Deferred:
Federal.................................................. 2,367 2,886
Foreign.................................................. (242) 142
State.................................................... 489 592
------- ------
Total deferred taxes....................................... 2,614 3,620
------- ------
Provision for income taxes................................. $11,864 12,156
======= ======
</TABLE>
(b) RECONCILIATION OF STATUTORY RATE OF EFFECTIVE RATE
Total income taxes as reflected in the consolidated statements of income and
retained income differ from the amounts computed by applying the statutory
federal corporate tax rate as follows:
<TABLE>
<CAPTION>
1997 1996
------------------- -------------------
AMOUNT PERCENT AMOUNT PERCENT
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Federal income tax at statutory rate...................... $11,158 35.0% $ 9,526 35.0%
State income taxes, net of federal tax benefit............ 1,375 4.3 1,151 4.2
Foreign taxes............................................. 743 2.3 1,571 5.8
Reduction of valuation allowance.......................... (1,314) (4.1) (536) (2.0)
Other, net................................................ (98) (0.3) 444 1.6
------- ---- ------- ----
Provision for income taxes................................ $11,864 37.2% $12,156 44.6%
======= ==== ======= ====
</TABLE>
F-74
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(4) INCOME TAXES (CONTINUED)
(c) DEFERRED TAX ASSETS AND LIABILITIES
The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities at
December 27, 1997 and December 28, 1996 were as follows:
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
Deferred tax assets:
Reserves, including casualty and other claims.......... $ 20,938 23,108
Employee benefits...................................... 11,989 12,919
Postretirement benefits other than pension and
postemployment benefits.............................. 9,089 9,094
Foreign tax net operating loss carryforwards........... 1,290 2,238
Other.................................................. 2,948 2,897
-------- -------
Total gross deferred tax assets.......................... 46,254 50,256
Less valuation allowance............................... 924 2,238
-------- -------
Net deferred tax asset................................... 45,330 48,018
-------- -------
Deferred tax liabilities:
Property............................................... (11,588) (11,176)
Other.................................................. (2,194) (1,186)
-------- -------
Total gross deferred tax liabilities..................... (13,782) (12,362)
-------- -------
Net deferred tax assets.................................. 31,548 35,656
Less net current deferred tax assets..................... 22,644 26,086
-------- -------
Net long-term deferred tax assets........................ $ 8,904 9,570
======== =======
</TABLE>
At December 27, 1997 and December 28, 1996, a valuation allowance has been
established due to the uncertainty of realization of foreign net operating loss
(NOL) carryforwards. The valuation allowance for deferred tax assets as of
December 27, 1997 and December 28, 1996 was $924 and $2,238, respectively. The
net change in the total valuation allowance for the years ended December 27,
1997 and December 28, 1996 was a decrease of $1,314 and a decrease of $536,
respectively. The decreases were a result of utilization of certain NOL benefits
and a reduction, in 1997, of the valuation allowance as realization appears
likely. Management believes all other deferred tax assets will be realized based
on the Company's anticipated future earnings.
(d) TAXING AUTHORITY REVIEWS
Consolidated federal income tax returns of NS (which include NAVL) have been
examined and Revenue Agent Reports have been received for all years up to and
including 1992. The consolidated federal income tax returns of NS for 1993 and
1994 are being audited by the IRS. Management believes that adequate provision
has been made for any additional taxes and interest thereon that might arise as
a result of these examinations.
F-75
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(5) DEBT
The Company's Canadian subsidiary had amounts outstanding under a revolving
line of credit of $600 at an average rate of 4.95% as of December 27, 1997, and
$702 at an average rate of 4.80% as of December 28, 1996. These amounts are
included in accounts payable in the consolidated balance sheets.
The Company's 51% owned subsidiary, Manufacturing Support Services, LLC, has
a short-term note payable of $125 due to Valley Logistics, LLC, the 49% owner.
This note is due March 3, 1998 and is included in accounts payable in the
consolidated balance sheet.
The Company had unused lines of credit of $2,045 and $1,616 at December 27,
1997 and December 28, 1996, respectively.
(6) RETIREMENT, POSTRETIREMENT MEDICAL PLANS
The Company's United States plans' funded status and amount recognized in
the Company's consolidated financial statements as of and for the years ended
December 27, 1997 and December 28, 1996 (based on actuarial valuation) are as
follows:
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
----------------------------- -----------------------------
DECEMBER 27, DECEMBER 28, DECEMBER 27, DECEMBER 28,
1997 1996 1997 1996
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
CHANGES IN BENEFIT OBLIGATION
Benefit obligation at beginning of year..... $33,523 31,963 12,623 14,559
Service cost................................ 2,220 2,207 901 1,006
Interest cost............................... 2,710 2,500 905 843
Plan participants contribution.............. -- -- -- --
Actuarial gain (loss)....................... 6,217 (577) 202 (3,307)
Benefits paid............................... (1,354) (2,570) (455) (478)
------- ------- -------- --------
Benefit obligation at end of year........... $43,316 33,523 14,176 12,623
======= ======= ======== ========
CHANGES IN PLAN ASSETS
Fair value of plan assets at beginning of
year...................................... 33,308 28,182
Actual return on plan assets................ 7,951 4,611
Employer contribution....................... 886 3,085
Benefit paid................................ (1,354) (2,570)
------- -------
Fair value of plan assets at end of year.... $40,791 33,308
======= =======
Benefit obligation.......................... $43,316 $33,523 $ 14,176 $ 12,623
Plan assets................................. 40,791 33,308 -- --
------- ------- -------- --------
Funded status............................... (2,525) (215) (14,176) (12,623)
Unrecognized prior service cost............. (11,939) (13,528) (8,927) (10,174)
Unrecognized net actuarial gain............. 6,709 6,463 3,359 3,327
------- ------- -------- --------
Accrued benefit cost........................ $(7,755) $(7,280) $(19,744) $(19,470)
======= ======= ======== ========
</TABLE>
F-76
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(6) RETIREMENT, POSTRETIREMENT MEDICAL PLANS (CONTINUED)
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
----------------------------- -----------------------------
DECEMBER 27, DECEMBER 28, DECEMBER 27, DECEMBER 28,
1997 1996 1997 1996
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
WEIGHTED-AVERAGE ASSUMPTIONS
Discount rate............................... 7.25% 7.75% 7.25% 7.75%
Expected return on plan assets.............. 9.00% 9.00%
Rate of compensation increase............... 5.00% 5.00%
</TABLE>
For measurement purposes, an 11% and 9.8% annual rate of increase in the per
capita cost of covered health care benefits was assumed for the years ended
December 28, 1996 and December 27, 1997, respectively. The rate was assumed to
decrease gradually to 5.5% for 2005 and remain at that level thereafter.
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
----------------------------- -----------------------------
DECEMBER 27, DECEMBER 28, DECEMBER 27, DECEMBER 28,
1997 1996 1997 1996
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
COMPONENTS OF NET PERIODIC BENEFITS COST
Service cost................................ $ 2,220 2,208 901 1,006
Interest cost............................... 2,710 2,500 905 844
Expected return on plan assets.............. (2,741) (2,409) -- --
Amortization of transition obligation....... 204 204 -- --
Amortization of prior service cost.......... (1,793) (1,793) (1,246) (1,246)
Amortization of Recognized actuarial (gain)
loss...................................... 762 1,396 166 284
------- ------ ------ ------
Net periodic benefits cost.................. $ 1,362 2,106 726 888
======= ====== ====== ======
</TABLE>
The Company sponsors the NAVL, Inc. Employee Retirement Plan, a funded,
noncontributory defined benefit pension plan (Qualified Plan) covering eligible
employees in the United States. The Qualified Plan provides for eligible
employees to receive retirement benefits based principally on years of service
with the Company, compensation rates over that time, and estimated primary
Social Security benefits. Contributions to the Qualified Plan are made on the
basis of not less than minimum funding standards set forth in the Employee
Retirement Income Security Act of 1974, as amended. Plan assets consist
primarily of common stocks and government securities.
The Company also has an Excess Benefit Plan which is an unfunded,
nonqualified plan that provides retirement benefits not otherwise provided under
the Qualified Plan because of the benefit limitations imposed by Section 415 and
401(a)(17) of the Internal Revenue Code. The Excess Benefit Plan ensures that an
executive receives the total pension benefit to which he/she otherwise would be
entitled, were it not for such limitations.
In addition, the Overlap Benefit Plan, an unfunded, nonqualified retirement
plan, provides retirement benefits forfeited by the highly compensated employees
under the Qualified Plan because of the changes to the retirement plan formula
which took effect April 18, 1989.
F-77
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(6) RETIREMENT, POSTRETIREMENT MEDICAL PLANS (CONTINUED)
The Company has nonpension postretirement benefit plans that provide
specific health care and death benefits to eligible retired employees. Under the
present plans, which may be amended or terminated at the Company's option, a
defined percentage of health care expenses is covered, after reductions for any
deductibles, co-payments, Medicare payments and, in some cases, coverage
provided by other group insurance policies. The cost of such health care
coverage to a retiree may be determined in part by a retiree's years of vested
service with the Company prior to retirement. Death benefits are based on a
fixed amount at time of retirement.
Assumed health care cost trend rates have a significant effect on the
amounts reported for the health care plans. A one-percentage-point change in
assumed health care cost trend rates would have the following effects:
<TABLE>
<CAPTION>
1997
---------------------------------------
1-PERCENTAGE-POINT 1-PERCENTAGE-POINT
INCREASE DECREASE
------------------ ------------------
<S> <C> <C>
Effect on total of service and interest cost
components................................. $ 334 $ (272)
Effect on postretirement benefit
obligation................................. 2,302 (1,928)
</TABLE>
<TABLE>
<CAPTION>
1996
---------------------------------------
1-PERCENTAGE-POINT 1-PERCENTAGE-POINT
INCREASE DECREASE
------------------ ------------------
<S> <C> <C>
Effect on total of service and interest cost
components................................. $ 314 $ (261)
Effect on postretirement benefit
obligation................................. 1,629 (1,418)
</TABLE>
The Company's German subsidiary, midiData, has an unfunded pension plan
under which certain employees of the company will receive certain percentages of
their monthly income when they retire. The accumulated benefit obligation was
$1,595 and $1,808 at the end of 1997 and 1996, respectively, and the projected
benefit obligation was $1,668 and $1,996, respectively. The net periodic pension
cost for the plan was $193 and $228 in 1997 and 1996, respectively. The
transition obligation of $316 is being amortized over the average remaining
service life of 13 years.
The Company's Canadian subsidiary, North American Van Lines Canada Ltd., has
a defined benefit plan with the benefits generally based upon years of service
and the highest five-year average salary during employment. At the end of 1997
and 1996, the actuarial present value of accrued pension benefits was $1,285 and
$1,499, respectively, and the aggregate market value of pension plan assets was
$1,686 and $1,621, respectively.
The Company's United Kingdom subsidiary, North American Van Lines, Ltd., has
a defined contribution plan for eligible employees. The plan is funded through
contributions from employees, generally 3% of earnings, that are matched by the
Company. The Company and employee contributions associated with the plan were
$61 and $38 for 1997 and 1996, respectively.
F-78
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(6) RETIREMENT, POSTRETIREMENT MEDICAL PLANS (CONTINUED)
The Company maintains an employee savings plan for eligible employees which
qualifies under Sections 401(a) and 401(k) of the Internal Revenue Code. The
Company has made no contributions to the plan since its inception.
(7) POSTEMPLOYMENT MEDICAL PLAN
The Company provides certain postemployment benefits to inactive employees
and their dependents during the period following employment but before
retirement. Effective the beginning of 1994, the Company adopted FAS No. 112
which requires the accrual of the cost of postemployment benefits rather than
expensing the costs when paid. These benefits are for continuation of health
care coverage. At the end of 1997 and 1996, the accumulated postemployment
benefit obligation was $2,088 and $2,256, respectively.
(8) INCENTIVE AND DEFERRED COMPENSATION
The Company maintains a Management Incentive Plan and an Executives'
Deferred Compensation Plan for certain executives and key management employees.
The plans are administered by the Board of Directors, who do not participate in
the plans. Interest expense is recognized based upon deferred compensation
balances.
The Company also maintains other incentive programs for eligible employees
not included in the Management Incentive Plan. The programs are administered by
the Vice-President of Human Resources, who does not participate.
Incentive compensation is based upon achievement of certain predetermined
corporate, departmental or individual performance goals. The expense associated
with incentive plans and programs was $6,233 and $5,302 for 1997 and 1996,
respectively. The interest expenses associated with the deferred compensation
program was $403 and $339 for 1997 and 1996, respectively.
(9) COMMITMENTS AND CONTINGENCIES
(a) LETTERS OF CREDIT AND DEBT GUARANTEES
In connection with its insurance agreements, at December 27, 1997 and
December 28, 1996, the Company had outstanding letters of credit of $13,869 and
$14,741, respectively, of which $9,500 is unconditionally guaranteed by NS. None
of these letters of credit have been utilized. At December 27, 1997 and
December 28, 1996, the Company is contingently liable as guarantors with respect
to $2,471 and $2,054, respectively.
(b) LAWSUITS
The Company and certain subsidiaries are defendants in numerous lawsuits
relating principally to motor carrier operations. While the final outcome of
these lawsuits cannot be predicted with certainty, it is the opinion of
management, after consulting with its legal counsel, that the amount of NAVL's
ultimate liability will not materially affect NAVL's consolidated financial
position, results of operations, or liquidity.
F-79
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(9) COMMITMENTS AND CONTINGENCIES (CONTINUED)
The Company had filed suit in the Circuit Court of Palm Beach County,
Florida, to recover approximately $5,000 in costs and expenses incurred in
defending and settling MICHAUD V. NAVL, INC., a personal injury/wrongful death
case which arose out of an August 1989 motor vehicle accident. The Company
recovered $4,750 in 1997 which was recorded as a reduction of casualty and other
claims expense.
In 1996, litigation brought in 1987 by a former agent was resolved in a
manner favorable to the Company. As a result, reserves established for the
contingent liability were reversed, reducing administration expenses by $3,650.
(c) ENVIRONMENTAL MATTERS
The Company has been named as a potentially responsible party (PRP) in four
environmental cleanup proceedings by federal or state authorities and one
additional environmental clean-up proceeding by a group of PRPs. The suits are
brought under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, or other federal or state statutes. Based on
all known information, it is estimated that the settlement cost of each PRP site
would not be materially or significantly larger than the reserves established,
which totaled $72 and $73 on December 27, 1997 and December 28, 1996,
respectively. It is possible that additional claims or lawsuits involving
unknown environmental matters or now unidentified environmental sites may arise
in the future.
The Company owns or has owned, and leases or has leased facilities at which
underground storage tanks for diesel fuel are located and operated. Management
believes that the Company has taken the appropriate and necessary action with
regard to releases of diesel fuel that have occurred. As conditions may exist on
these properties related to environmental problems that are latent or
undisclosed, there can be no assurance that the Company will not incur
liabilities or costs, the amount and materiality of which cannot be estimated
reliably at this time. However, based on its assessment of the facts and
circumstances now known and after consulting with its legal counsel, management
believes that it has recorded appropriate estimates of liability for those
environmental matters of which the Company is aware. Further, management
believes it is unlikely that any identified matters, either individually or in
aggregate, will have a material adverse effect on the Company's financial
position, results of operations, or liquidity.
(10) LEASE COMMITMENTS
The Company has noncancelable lease commitments under operating leases for
rental of office space, warehouse facilities, and office equipment. The
Company's rental expense under these operating leases was $12,345 and $9,918 in
1997 and 1996, respectively. Future minimum lease commitments under
noncancelable leases are as follows: 1998, $11,931; 1999, $9,559; 2000, $7,008;
2001, $5,282; 2002, $4,000; and thereafter, $7,084.
(11) PREFERRED STOCK (PER SHARE AMOUNTS IN WHOLE DOLLARS)
There are 10,000 shares of $100 par value series A (nonvoting) preferred
stock authorized, issued, and outstanding as of December 27, 1997 and
December 28, 1996. Holders of preferred stock are entitled to
F-80
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(11) PREFERRED STOCK (PER SHARE AMOUNTS IN WHOLE DOLLARS) (CONTINUED)
receive cumulative dividends at the annual rate of $7 per share, payable in
arrears, on a quarterly basis. If the required dividend payment for any quarter
is not paid in full within five business days after the end of such quarter, the
annual rate of dividends on the preferred stock increases to $9 per share for
the period from the end of such quarter to the date when payment of all
dividends is fully current. The fixed liquidation price for each share of
preferred stock is its par value, plus an amount equal to all dividends, whether
or not declared, that are accrued and unpaid to the date of payment of the
liquidation price.
(12) FINANCIAL INSTRUMENTS
The Company has used financial instruments, principally forward contracts,
in its management of foreign currency exposures. At December 27, 1997 and
December 28, 1996 the Company had no open positions on forward contracts.
(13) DISCONTINUED OPERATIONS
In 1997 and 1996 liabilities attributable to discontinued operations of the
corporation were reduced by $3,800 ($2,306 after tax) and $4,070 ($2,470 after
tax), respectively. The reversals were primarily from reductions in accrued
casualty and workers' compensation claims based on actuarial valuations.
(14) YEAR 2000
In 1996, the Company developed a plan to deal with the Year 2000 problem and
began converting its computer systems and applications to be Year 2000
compliant. The plan provides for the conversion efforts to be completed by the
end of 1998. The year 2000 problem is the result of computer programs being
written using two digits rather than four to define the applicable year. The
total cost of the project is estimated to be $2,000 and is being funded through
operating cash flows. The Company is expensing all costs associated with these
systems changes as the costs are incurred. As of December 27, 1997, $1,116 had
been expensed.
(15) OPERATING SEGMENTS
The Company has presented information on two segments for disclosure
purposes: Van Line Network and Logistics Services.
The Van Line Network segment provides domestic and international residential
relocation services through a network of exclusive agents. It is comprised of
the Relocation Services Division, which provides packing, loading,
transportation, delivery and warehousing services for any type of household move
in the U.S. and Canada, and the International Division, which provides or
coordinates these same services for customers on a global basis.
The Logistics Services segment provides customized logistics solutions,
specialized transportation services, warehousing, distribution, and delivery
services to commercial customers. It is comprised of the Logistics Division,
which provides these specialized services to principally electronics, medical
equipment and other suppliers of sensitive goods requiring specialized handling
in the U.S., the Blanket Wrap/Flatbed
F-81
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(15) OPERATING SEGMENTS (CONTINUED)
Division, which provides transportation of truckload freight requiring
specialized handling in the U.S., and the Europe Division, which provides these
same logistics services in Europe and the U.K.
The table below represents information about revenues, income from
operations and total assets by segment used by the chief decision makers of the
Company as of and for the years ended December 27, 1997 and December 28, 1996:
<TABLE>
<CAPTION>
VAN LINE LOGISTICS CONSOLIDATED
NETWORK SERVICES CORPORATE(1) TOTALS
-------- --------- ------------ ------------
<S> <C> <C> <C> <C>
DECEMBER 27, 1997
Operating revenues.............. $518,628 422,873 -- $941,501
Income from operations.......... 15,350 15,813 -- 31,163
Total assets.................... 109,357 102,431 90,547 302,335
DECEMBER 28, 1996
Operating revenues.............. $528,495 401,753 -- $930,248
Income from operations.......... 13,705 14,362 -- 28,067
Total assets.................... 107,879 97,322 82,057 287,258
</TABLE>
- ------------------------
(1) Total assets by segment are specific assets such as revenue equipment and
trade receivables. Assets included in the corporate category include
non-allocated assets such as the corporate headquarters building, computer
hardware and software, contracts receivable associated with equipment sales,
deferred taxes, and goodwill.
Specified items included in segment results for the years ended
December 27, 1997 and December 28, 1996:
<TABLE>
<CAPTION>
VAN LINE LOGISTICS CONSOLIDATED
NETWORK SERVICES CORPORATE(2) TOTALS
-------- --------- ------------ ------------
<S> <C> <C> <C> <C>
DECEMBER 27, 1997
Depreciation and amortization.... $5,349 7,118 -- $12,467
Non-operating income (expense)
and minority interests......... -- (89) -- (89)
Discontinued operations credit,
net............................ -- -- 2,306 2,306
DECEMBER 28, 1996
Depreciation and amortization.... $5,568 7,167 -- $12,735
Non-operating income (expense)
and minority interests......... 160 (160) -- --
Discontinued operations credit,
net............................ -- -- 2,470 2,470
</TABLE>
- ------------------------
(2) Depreciation expense for corporate property and equipment is allocated to
the segments in order to determine segment income from operations.
F-82
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(15) OPERATING SEGMENTS (CONTINUED)
Specified items included in segment assets as of December 27, 1997 and
December 28, 1996:
<TABLE>
<CAPTION>
VAN LINE LOGISTICS CONSOLIDATED
NETWORK SERVICES CORPORATE TOTALS
-------- --------- --------- ------------
<S> <C> <C> <C> <C>
DECEMBER 27, 1997
Capital expenditures................ $2,432 5,504 2,652 $10,588
DECEMBER 28, 1996
Capital expenditures................ $1,661 3,622 2,162 $ 7,445
</TABLE>
Revenue and long-lived asset information by geographic area as of and for
the years ended December 27, 1997 and December 28, 1996:
<TABLE>
<CAPTION>
REVENUES LONG-LIVED ASSETS
------------------- -------------------
1997 1996 1997 1996
-------- -------- -------- --------
<S> <C> <C> <C> <C>
United States.......................... $855,019 843,050 $ 96,764 77,557
Foreign................................ 86,482 87,198 3,790 4,486
-------- ------- -------- ------
Total.................................. $941,501 930,248 $100,554 82,043
======== ======= ======== ======
</TABLE>
Revenue designation is based on the country in which the sales originated.
(16) SUBSEQUENT EVENTS
On January 12, 1998, NS announced a definitive agreement with Clayton,
Dubilier & Rice, Inc. (CD&R) to sell North American Van Lines for $200 million.
CD&R is a private investment company headquartered in New York. The sale,
subject to customary closing conditions, is expected to be completed within the
first half of 1998. The financial statements do not reflect any adjustments
which may result due to the sale.
(17) SUPPLEMENTAL INFORMATION
The accompanying supplementary information was prepared to segregate the
financial statements between the parent, those entities that will guarantee debt
pursuant to an agreement dated November 19, 1999 ("Guarantor entities"), and
those entities that will not guarantee such debt ("Nonguarantor entities").
F-83
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(17) SUPPLEMENTAL INFORMATION (CONTINUED)
Consolidated condensed statements of income data for the years ended
December 27, 1997 and December 28, 1996 are as follows:
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED DECEMBER 27, 1997
----------------------------------------------------------------
(2)
(1) TOTAL NON- NAVL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Operating revenues..................... $820,541 38,510 96,719 (14,269) 941,501
Total operating expenses............... 793,157 39,224 93,898 (15,941) 910,338
-------- ------ ------ ------- -------
Income (loss) from operations.......... 27,384 (714) 2,821 1,672 31,163
Other (income) expenses................ (3,751) -- (253) 3,198 (806)
-------- ------ ------ ------- -------
Income (loss) before minority interest
and income taxes..................... 31,135 (714) 3,074 (1,526) 31,969
Minority interest in income of
subsidiaries......................... -- 89 -- -- 89
-------- ------ ------ ------- -------
Income (loss) before income taxes...... 31,135 (803) 3,074 (1,526) 31,880
Provision (benefit) for income taxes... 11,119 (396) 1,141 -- 11,864
-------- ------ ------ ------- -------
Income (loss) from continuing
operations........................... 20,016 (407) 1,933 (1,526) 20,016
Discontinued operations--credit (less
applicable income taxes of $1,494)... 2,306 -- -- -- 2,306
-------- ------ ------ ------- -------
Net income (loss)...................... $ 22,322 (407) 1,933 (1,526) 22,322
======== ====== ====== ======= =======
</TABLE>
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED DECEMBER 28, 1996
----------------------------------------------------------------
(2)
(1) TOTAL NON- NAVL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Operating revenues..................... $811,119 37,897 94,959 (13,727) 930,248
Total operating expenses............... 786,346 37,671 93,296 (15,132) 902,181
-------- ------ ------ ------- -------
Income (loss) from operations.......... 24,773 226 1,663 1,405 28,067
Other (income) expenses................ (526) -- (567) 1,944 851
-------- ------ ------ ------- -------
Income (loss) before income taxes...... 25,299 226 2,230 (539) 27,216
Provision (benefit) for income taxes... 10,239 (1) 1,918 -- 12,156
-------- ------ ------ ------- -------
Income (loss) from continuing
operations........................... 15,060 227 312 (539) 15,060
Discontinued operations--credit (less
applicable income taxes of $1,600)... 2,470 -- -- -- 2,470
-------- ------ ------ ------- -------
Net income (loss)...................... $ 17,530 227 312 (539) 17,530
======== ====== ====== ======= =======
</TABLE>
F-84
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(17) SUPPLEMENTAL INFORMATION (CONTINUED)
Consolidated condensed statement of balance sheets data as of December 27,
1997 and December 28, 1996 is summarized as follows:
<TABLE>
<CAPTION>
DECEMBER 27, 1997
----------------------------------------------------------------
(2)
(1) TOTAL NON- NAVL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Current assets......................... $155,491 17,589 22,638 (2,841) 192,877
Non-current assets..................... 130,916 774 20,889 (43,121) 109,458
-------- ------ ------ ------- -------
Total assets........................... $286,407 18,363 43,527 (45,962) 302,335
======== ====== ====== ======= =======
Current liabilities.................... 110,755 4,988 16,829 (1,695) 130,877
Non-current liabilities................ 67,536 3,379 12,719 (20,292) 63,342
-------- ------ ------ ------- -------
Total liabilities...................... 178,291 8,367 29,548 (21,987) 194,219
Stockholders' equity................... 108,116 9,996 13,979 (23,975) 108,116
-------- ------ ------ ------- -------
Total liabilities and equity........... $286,407 18,363 43,527 (45,962) 302,335
======== ====== ====== ======= =======
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 28, 1996
----------------------------------------------------------------
(2)
(1) TOTAL NON- NAVL
PARENT GUARANTORS GUARANTORS ELIMINATIONS CONSOLIDATED
-------- ---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Current assets......................... $160,387 15,554 23,427 (3,723) 195,645
Non-current assets..................... 112,743 419 12,077 (33,626) 91,613
-------- ------ ------ ------- -------
Total assets........................... $273,130 15,973 35,504 (37,349) 287,258
======== ====== ====== ======= =======
Current liabilities.................... 120,927 4,528 16,888 (2,541) 139,802
Non-current liabilities................ 66,087 1,637 4,223 (10,607) 61,340
-------- ------ ------ ------- -------
Total liabilities...................... 187,014 6,165 21,111 (13,148) 201,142
Stockholders' equity................... 86,116 9,808 14,393 (24,201) 86,116
-------- ------ ------ ------- -------
Total liabilities and equity........... $273,130 15,973 35,504 (37,349) 287,258
======== ====== ====== ======= =======
</TABLE>
F-85
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(17) SUPPLEMENTAL INFORMATION (CONTINUED)
Consolidated condensed statement of cash flows data for the years ended
December 27, 1997 and December 28, 1996 is summarized as follows:
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED DECEMBER 27, 1997
-------------------------------------------------
(2)
(1) TOTAL NON- NAVL
PARENT GUARANTORS GUARANTORS CONSOLIDATED
-------- ---------- ---------- ------------
<S> <C> <C> <C> <C>
Net cash provided by (used in) operating
activities...................................... $ 28,371 (138) 695 28,928
Net cash provided by (used in) investing
activities...................................... (20,703) -- 738 (19,965)
Net cash used in financing activities............. (6,172) -- -- (6,172)
Effect of exchange rate changes on cash........... -- -- (168) (168)
Minority interest................................. 238 -- -- 238
Unrealized investment gains (net of deferred
taxes).......................................... -- -- (84) (84)
-------- ------ ------ -------
Net cash flows from continuing operations......... 1,734 (138) 1,181 2,777
-------- ------ ------ -------
Net cash flows from the payment of liabilities
attributable to discontinued operations......... (1,696) -- -- (1,696)
-------- ------ ------ -------
Net increase in cash and cash equivalents......... 38 (138) 1,181 1,081
Cash at beginning of period....................... 574 80 1,213 1,867
-------- ------ ------ -------
Cash at end of period............................. $ 612 (58) 2,394 2,948
======== ====== ====== =======
</TABLE>
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED DECEMBER 28, 1996
-------------------------------------------------
(2)
(1) TOTAL NON- NAVL
PARENT GUARANTORS GUARANTORS CONSOLIDATED
-------- ---------- ---------- ------------
<S> <C> <C> <C> <C>
Net cash provided by (used in) operating
activities...................................... $ 40,909 108 (1,343) 39,674
Net cash provided by (used in) investing
activities...................................... (8,244) -- 5 (8,239)
Net cash used in financing activities............. (30,969) -- -- (30,969)
Effect of exchange rate changes on cash........... -- -- 35 35
Unrealized investment gains (net of deferred
taxes).......................................... -- -- 165 165
-------- ------ ------ -------
Net cash flows from continuing operations......... 1,696 108 (1,138) 666
-------- ------ ------ -------
Net cash flows from the payment of liabilities
attributable to discontinued operations......... (1,107) -- -- (1,107)
-------- ------ ------ -------
Net increase in cash and cash equivalents......... 589 108 (1,138) (441)
Cash at beginning of period....................... (15) (28) 2,351 2,308
-------- ------ ------ -------
Cash at end of period............................. $ 574 80 1,213 1,867
======== ====== ====== =======
</TABLE>
- ------------------------
(1) Parent includes the accounts of North American Van Lines, Inc., a Delaware
corporation and the issuer of the debt.
F-86
<PAGE>
NORTH AMERICAN VAN LINES, INC.
(ALL OF THE COMMON STOCK OF WHICH IS OWNED BY NS)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 27, 1997 AND DECEMBER 28, 1996
(DOLLARS IN THOUSANDS)
(17) SUPPLEMENTAL INFORMATION (CONTINUED)
(2) Total Guarantors include the accounts of the following subsidiaries of North
American Van Lines, Inc.: Fleet Insurance Management, Inc., an Indiana
corporation; FrontRunner Worldwide, Inc., a Delaware corporation;
NACAL, Inc., a California corporation; NAVTRANS International Freight
Forwarding, Inc., an Indiana corporation; North American Distribution
Systems, Inc., an Indiana corporation; North American Logistics, Ltd., an
Indiana Corporation; North American Van Lines of Texas, Inc., a Texas
corporation; Relocation Management Systems, Inc., a Delaware corporation;
and Great Falls North American, Inc., a Montana corporation. Each Guarantor
is a wholly owned subsidiary of North American Van Lines, Inc. and will
jointly and severally, irrevocably and fully and unconditionally guarantee
the punctual payment of such debt.
F-87
<PAGE>
NFC MOVING SERVICES GROUP
REVIEW REPORT OF INDEPENDENT AUDITORS
To: The Board of Directors
NFC plc
We have reviewed the accompanying condensed combined balance sheets of NFC
Moving Services Group as at June 30, 1998 and 1999, and the related condensed
combined profit and loss accounts and condensed combined statements of total
recognized gains and losses, cash flows and NFC Group Investment for each of the
nine month periods ended June 30, 1998 and 1999. These financial statements are
the responsibility of the management of NFC Moving Services Group.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data, and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, which will be performed
for the full year with the objective of expressing an opinion regarding the
financial statements as a whole. Accordingly, we do not express such an opinion.
Based on our reviews, we are not aware of any material modifications that should
be made to the accompanying condensed combined financial statements referred to
above for them to be in conformity with accounting principles generally accepted
in the United Kingdom, which differ in certain respects from those generally
accepted in the United States (see Note 4 of Notes to the Condensed Combined
Financial Statements).
/s/ Ernst & Young
ERNST & YOUNG
London, England
September 20, 1999
F-88
<PAGE>
NFC MOVING SERVICES GROUP
CONDENSED COMBINED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
JUNE 30
------------------------------
1998 1999
------------- --------------
(L MILLION)
<S> <C> <C>
FIXED ASSETS
Property, plant and equipment............................. 48.1 51.4
Investments............................................... 25.4 30.2
Goodwill.................................................. -- 5.4
------------- --------------
73.5 87.0
------------- --------------
CURRENT ASSETS
Inventories............................................... 3.4 3.6
Debtors: Amounts falling due within one year.............. 91.4 109.6
Debtors: Amounts falling due after more than one year..... 5.3 6.4
Cash at bank and in hand.................................. 19.4 25.9
------------- --------------
119.5 145.5
CURRENT LIABILITIES
Creditors: Amounts falling due within one year............ (90.0) (99.4)
NFC Group balances........................................ (13.6) (168.9)
------------- --------------
NET CURRENT ASSETS/(LIABILITIES)............................ 15.9 (122.8)
------------- --------------
TOTAL ASSETS LESS CURRENT LIABILITIES....................... 89.4 (35.8)
Provisions for liabilities and charges...................... (25.8) (27.2)
------------- --------------
NET ASSETS.................................................. 63.6 (63.0)
============= ==============
NFC GROUP INVESTMENT........................................ 63.6 (63.0)
============= ==============
</TABLE>
- ------------------------
(i) Amounts owed by and to NFC Group businesses are not necessarily
representative of amounts that would have been reported by NFC Moving
Services Group on a stand-alone basis or that will be reported by NFC Moving
Services Group in the future.
(ii) A summary of the significant adjustments to NFC Group investment which
would be required if US generally accepted accounting principles had been
applied instead of those generally accepted in the United Kingdom is given
in the Note to the Combined Financial Statements.
See Notes to the Condensed Combined Financial Statements
F-89
<PAGE>
NFC MOVING SERVICES GROUP
CONDENSED COMBINED PROFIT AND LOSS ACCOUNTS
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED JUNE 30
-------------------------
1998 1999
----------- -----------
(L MILLION)
<S> <C> <C>
NET SALES--(NOTE 2)......................................... 486.3 496.8
===== =====
OPERATING PROFIT (I)--(NOTE 3)
before exceptional items.................................. 13.7 13.8
Exceptional costs of reorganization....................... (1.0) (1.4)
----- -----
TOTAL OPERATING PROFIT...................................... 12.7 12.4
Profit on disposals of properties........................... -- 0.4
----- -----
PROFIT BEFORE INTEREST...................................... 12.7 12.8
Interest (net) (ii)......................................... 0.6 (0.3)
----- -----
Profit before tax and exceptional items..................... 14.3 13.5
Exceptional items........................................... (1.0) (1.0)
----- -----
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION............... 13.3 12.5
Taxation (ii)............................................... (2.4) (2.9)
----- -----
PROFIT FOR THE PERIOD (I) (II).............................. 10.9 9.6
===== =====
</TABLE>
- ------------------------
(i) A summary of the significant adjustments to profit for the financial year
which would be required if US generally accepted accounting principles had
been applied instead of those generally accepted in the United Kingdom is
given in Note 4 of Notes to the Condensed Combined Financial Statements.
(ii) Interest (net) and taxation are not necessarily representative of the
income and charges that would have been earned or incurred by NFC Moving
Services Group on a stand-alone basis or that will be earned or incurred by
NFC Moving Services Group in the future.
See Notes to the Condensed Combined Financial Statements
F-90
<PAGE>
NFC MOVING SERVICES GROUP
CONDENSED COMBINED STATEMENTS OF TOTAL RECOGNIZED GAINS AND LOSSES
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS
ENDED JUNE 30
-----------------------
1998 1999
-------- --------
(L MILLION)
<S> <C> <C>
PROFIT FOR THE PERIOD....................................... 10.9 9.6
Unrealized surplus on revaluation of properties............. 0.7 0.6
Exchange differences........................................ (1.9) 1.8
---- ----
TOTAL GAINS AND LOSSES RELATING TO THE PERIOD (I)........... 9.7 12.0
==== ====
</TABLE>
- ------------------------
(i) The significant differences between the combined statements of total
recognized gains and losses presented above and the combined statements of
comprehensive income required under US generally accepted accounting
principles are described in Note 4 of Notes to the Condensed Combined
Financial Statements.
See Notes to the Condensed Combined Financial Statements
F-91
<PAGE>
NFC MOVING SERVICES GROUP
CONDENSED COMBINED CASH FLOW STATEMENTS (I)
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
JUNE 30
-----------------------
1998 1999
-------- --------
(L MILLION)
<S> <C> <C>
NET CASH INFLOW FROM OPERATING ACTIVITIES................... 23.8 17.0
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE
Interest received (net)..................................... 2.9 2.3
NFC Group interest (net).................................... (2.3) (2.4)
----- -----
NET CASH INFLOW/(OUTFLOW) FROM RETURNS ON INVESTMENTS AND
SERVICING OF FINANCE (II)................................. 0.6 (0.1)
TAX PAID (II)............................................... (3.5) (2.9)
CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT
Purchases of property, plant and equipment.................. (11.5) (9.1)
Purchases of investments (net).............................. (3.3) (2.1)
Disposals of property, plant and equipment.................. 3.6 2.6
----- -----
NET CASH OUTFLOW FROM CASH EXPENDITURE AND FINANCIAL
INVESTMENT................................................ (11.2) (8.6)
----- -----
FREE CASH FLOW.............................................. 9.7 5.4
ACQUISITIONS AND DISPOSALS
Purchases of subsidiary undertakings........................ (0.2) (9.9)
----- -----
NET CASH INFLOW/(OUTFLOW) BEFORE FINANCING.................. 9.5 (4.5)
NET CASH INFLOW/(OUTFLOW) FROM FINANCING (II)............... (10.0) 4.7
----- -----
INCREASE/(DECREASE) IN CASH................................. (0.5) 0.2
===== =====
RECONCILIATION OF OPERATING PROFIT TO OPERATING CASH FLOW
OPERATING PROFIT............................................ 12.7 12.4
Depreciation................................................ 6.9 7.4
Profit on disposals of tangible fixed assets................ (0.2) (0.2)
Movements in provisions..................................... 1.8 (0.9)
Movements in working capital................................ 2.6 (1.7)
----- -----
NET CASH INFLOW FROM OPERATING ACTIVITIES................... 23.8 17.0
===== =====
</TABLE>
- ------------------------
(i) The significant differences between the combined cash flow statements
presented above and those required under US generally accepted accounting
principles are described in Note 4 of Notes to the Condensed Combined
Financial Statements.
(ii) Net interest received/(paid), tax paid and financing cash flows are not
necessarily representative of the amounts that would have been earned or
incurred in NFC Moving Services Group on a stand-alone basis or that will be
earned or incurred by NFC Moving Services Group in the future.
See Notes to the Condensed Combined Financial Statements
F-92
<PAGE>
NFC MOVING SERVICES GROUP
CONDENSED COMBINED STATEMENTS OF CHANGES IN NFC GROUP INVESTMENT
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED JUNE 30
-------------------------
1998 1999
----------- -----------
(L MILLION)
<S> <C> <C>
Profit for the period....................................... 10.9 9.6
NFC Group funding/(divestment) (net)........................ 21.6 (124.2)
Unrealized surplus on revaluation of properties............. 0.7 0.6
Exchange differences........................................ (1.9) 1.8
---- ------
Movement in the period...................................... 31.3 (112.2)
Opening balance............................................. 32.3 49.2
---- ------
Closing balance............................................. 63.6 (63.0)
==== ======
</TABLE>
See Notes to the Condensed Combined Financial Statements
F-93
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE CONDENSED COMBINED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1--BASIS OF PREPARATION
These condensed combined financial statements, which are unaudited, have
been prepared on the same basis as and in accordance with the accounting
policies described in the audited combined financial statements of NFC Moving
Services Group for the three years ended September 30, 1998, except that from
October 1, 1998, goodwill is capitalized and amortized over its useful life in
accordance with Financial Reporting Standard 10, Goodwill and Intangible Assets.
In the opinion of the management of NFC Moving Services Group, all adjustments
considered necessary for a fair presentation have been included. Operating
results for the nine months ended June 30, 1999, are not necessarily indicative
of the results that may be expected for the year ending September 30, 1999.
NOTE 2--NET SALES
<TABLE>
<CAPTION>
NINE MONTHS ENDED
JUNE 30
-----------------------
1998 1999
-------- --------
(L MILLION)
<S> <C> <C>
United Kingdom and Ireland................................. 87.4 88.9
Continental Europe......................................... 13.6 14.5
Americas................................................... 348.0 353.9
Asia Pacific............................................... 37.3 39.5
----- -----
486.3 496.8
===== =====
</TABLE>
The analysis of net sales is by management structure. The analysis by
destination would not be materially different. Net sales between geographical
segments are not material.
NOTE 3--OPERATING PROFIT
<TABLE>
<CAPTION>
NINE MONTHS ENDED
JUNE 30
-----------------------
1998 1999
-------- --------
(L MILLION)
<S> <C> <C>
United Kingdom and Ireland................................. 8.7 7.7
Continental Europe......................................... 0.1 0.4
Americas................................................... 3.4 3.6
Asia Pacific............................................... 1.5 2.1
----- -----
13.7 13.8
Exceptional items
United Kingdom and Ireland................................. (0.7) (0.4)
Continental Europe....................................... (0.3) (1.0)
----- -----
12.7 12.4
===== =====
</TABLE>
F-94
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE CONDENSED COMBINED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
NOTE 4-- DIFFERENCES BETWEEN UNITED KINGDOM AND UNITED STATES GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES
The effect of the significant adjustments to profit for the period,
comprehensive income and NFC Group Investment which would be required if US GAAP
had been applied instead of UK GAAP is summarized below.
<TABLE>
<CAPTION>
NINE MONTHS ENDED JUNE 30
-------------------------
1998 1999
----------- -----------
(L MILLION)
<S> <C> <C>
PROFIT FOR THE PERIOD
Profit for the period as reported........................... 10.9 9.6
US GAAP adjustments:
Operating charges
Staff costs -- wages and salaries......................... 0.3 --
-- pensions...................................... 1.1 1.2
Depreciation and amortization--goodwill................... (0.7) (0.7)
--revaluation of land and
buildings.................... 0.1 0.1
Profit on disposal of land and buildings.................... 2.4 --
Taxation--standalone adjustment............................. (0.3) (0.2)
Deferred taxation........................................... (0.6) (0.7)
---- ----
2.3 (0.3)
---- ----
Profit for the as adjusted to accord with US GAAP........... 13.2 9.3
==== ====
COMPREHENSIVE INCOME
Total recognized gains and losses as reported............... 9.7 12.0
US GAAP adjustments:
Adjustments to profit for the period as shown above......... 2.3 (0.3)
Unrealized surplus on revaluation of properties............. (0.7) (0.6)
Unrealized holding gains/(losses) on investments............ (0.5) 1.1
Deferred taxation on unrealized holding gains/(losses) on
investments............................................... 0.2 (0.4)
---- ----
Comprehensive income in accordance with US GAAP............. 11.0 11.8
==== ====
</TABLE>
F-95
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE CONDENSED COMBINED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
NOTE 4-- DIFFERENCES BETWEEN UNITED KINGDOM AND UNITED STATES GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES (CONTINUED)
<TABLE>
<CAPTION>
JUNE 30,
NFC GROUP INVESTMENT ---------------------------------------------------------------
1998 1999
------------------------------ ------------------------------
(L MILLION)
<S> <C> <C> <C> <C> <C> <C>
NFC Group Investment as reported.................... 63.6 (63.0)
US GAAP adjustments:
Intangible assets--goodwill--cost................... 34.1 34.1
--amortization............... (9.2) 24.9 (10.1) 24.0
---- -----
Unrealized holding gains on investments............. 0.9 1.4
Property, plant and equipment (revaluation)
-- cost or valuation.......................... (4.9) (5.1)
-- depreciation............................... (1.6) (6.5) (1.8) (6.9)
---- -----
Accruals and deferred income........................ (2.6) (2.5)
Taxation--standalone adjustment..................... (0.4) (0.7)
Deferred taxation................................... 5.5 4.6
----- -----
21.8 19.9
----- -----
NFC Group Investment as adjusted to accord with
US GAAP........................................... 85.4 (43.1)
===== =====
</TABLE>
The categories of cash flow activity under US GAAP are summarized below:
<TABLE>
<CAPTION>
NINE MONTHS
ENDED JUNE 30
-----------------------
1998 1999
-------- --------
(L MILLION)
<S> <C> <C>
Cash inflows from operating activities...................... 20.9 14.0
Cash outflows on investing activities....................... (11.4) (18.5)
Cash inflows/(outflows) from financing activities........... (3.0) 11.1
Effect of exchange rate changes on cash..................... (1.0) 1.3
----- -----
Increase in cash and cash equivalents....................... 5.5 7.9
Cash and cash equivalents at beginning of period............ 13.9 18.0
----- -----
Cash and cash equivalents at beginning of period............ 19.4 25.9
===== =====
</TABLE>
F-96
<PAGE>
NFC MOVING SERVICES GROUP
REPORT OF INDEPENDENT AUDITORS
To: The Board of Directors
NFC plc
We have audited the combined balance sheets of NFC Moving Services Group as at
September 30, 1997 and 1998, and the related combined profit and loss accounts,
and combined statements of total recognized gains and losses, cash flows and NFC
Group Investment for each of the three years in the period ended September 30,
1998. These financial statements are the responsibility of the management of NFC
Moving Services Group. Our responsibility is to form an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with United Kingdom auditing standards
which do not differ in any significant respect from United States generally
accepted auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provided a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the combined financial position of NFC Moving Services
Group at September 30, 1997 and 1998, and the combined results of its operations
and its combined cash flows for each of the three years in the period ended
September 30, 1998 in conformity with accounting principles generally accepted
in the United Kingdom which differ in certain respects from those generally
accepted in the United States (see Note 22 of Notes to the Combined Financial
Statements).
[LOGO]
ERNST & YOUNG
London, England
September 13, 1999
F-97
<PAGE>
NFC MOVING SERVICES GROUP
COMBINED BALANCE SHEETS
<TABLE>
<CAPTION>
SEPTEMBER 30
-------------------
1997 1998
-------- --------
(L MILLION)
<S> <C> <C>
FIXED ASSETS
Property, plant and equipment--(Note 10).................. 45.4 48.8
Investments--(Note 11).................................... 22.9 26.0
------ ------
68.3 74.8
------ ------
CURRENT ASSETS
Inventories............................................... 3.7 3.3
Debtors: Amounts falling due within one year (i)--(Note
12)....................................................... 175.8 181.6
Debtors: Amounts falling due after more than one
year--(Note 13)........................................... 4.6 4.2
Cash at bank and in hand.................................. 13.9 18.0
------ ------
198.0 207.1
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR (i)--(NOTE
14)....................................................... (209.3) (206.5)
------ ------
NET CURRENT ASSETS/(LIABILITIES)............................ (11.3) 0.6
------ ------
TOTAL ASSETS LESS CURRENT LIABILITIES....................... 57.0 75.4
Provisions for liabilities and charges--(Note 15)........... (24.7) (26.2)
------ ------
NET ASSETS--(NOTE 17)....................................... 32.3 49.2
====== ======
NFC GROUP INVESTMENT (ii)................................... 32.3 49.2
====== ======
</TABLE>
- ------------------------
(i) Amounts owed by and to NFC Group businesses are not necessarily
representative of amounts that would have been reported by NFC Moving
Services Group on a stand-alone basis or that will be reported by NFC Moving
Services Group in the future.
(ii) A summary of the significant adjustments to NFC Group Investment which
would be required if US generally accepted accounting principles had been
applied instead of those generally accepted in the United Kingdom is given
in Note 22 of Notes to the Combined Financial Statements.
F-98
<PAGE>
NFC MOVING SERVICES GROUP
COMBINED PROFIT AND LOSS ACCOUNTS
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
NET SALES--(Note 4)......................................... 658.1 680.7 698.3
===== ===== =====
OPERATING PROFIT (i)--(Note 7)
Before exceptional items.................................. 18.7 21.3 26.1
Exceptional costs of reorganization....................... (3.0) (2.3) (1.6)
----- ----- -----
TOTAL OPERATING PROFIT...................................... 15.7 19.0 24.5
Profit/(loss) on disposals of properties.................... (1.0) 2.3 0.2
Loss on disposal of operations.............................. -- -- (0.3)
----- ----- -----
PROFIT BEFORE INTEREST...................................... 14.7 21.3 24.4
Interest (net) (ii)--(Note 8)............................... (0.7) (2.2) 0.2
----- ----- -----
Profit before tax and exceptional items..................... 18.0 19.1 26.3
Exceptional items........................................... (4.0) -- (1.7)
----- ----- -----
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION............... 14.0 19.1 24.6
Taxation (ii)--(Note 9)..................................... (5.0) (7.2) (4.6)
----- ----- -----
PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION................ 9.0 11.9 20.0
Equity minority interests................................... (0.1) (0.1) --
----- ----- -----
PROFIT FOR THE FINANCIAL YEAR (I) (II)...................... 8.9 11.8 20.0
===== ===== =====
</TABLE>
- ------------------------
(i) A summary of the significant adjustments to profit for the financial year
which would be required if US generally accepted accounting principles had
been applied instead of those generally accepted in the United Kingdom is
given in Note 22 of Notes to the Combined Financial Statements.
(ii) Interest (net) and taxation are not necessarily representative of the
income and charges that would have been earned or incurred by NFC Moving
Services Group on a stand-alone basis or that will be earned or incurred by
NFC Moving Services Group in the future.
F-99
<PAGE>
NFC MOVING SERVICES GROUP
COMBINED STATEMENTS OF TOTAL RECOGNIZED GAINS AND LOSSES
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
PROFIT FOR THE FINANCIAL YEAR............................... 8.9 11.8 20.0
Exchange differences........................................ 0.3 (0.6) (2.0)
Unrealized surplus/(deficit) on revaluation of properties... (0.7) 0.4 0.7
---- ---- ----
TOTAL GAINS AND LOSSES RELATING TO THE YEAR (i)............. 8.5 11.6 18.7
==== ==== ====
</TABLE>
- ------------------------
(i) The significant differences between the combined statements of total
recognized gains and losses presented above and the combined statements of
comprehensive income required under US generally accepted accounting
principles are described in Note 22 of Notes to the Combined Financial
Statements.
COMBINED STATEMENTS OF HISTORICAL COST PROFITS AND LOSSES
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION............... 14.0 19.1 24.6
Revaluation surpluses realized on disposals of properties... 7.1 0.2 --
Difference between depreciation based on historical costs
and on revalued amounts................................... 0.2 0.2 0.2
---- ---- ----
HISTORICAL COST PROFIT ON ORDINARY ACTIVITIES BEFORE
TAXATION.................................................. 21.3 19.5 24.8
==== ==== ====
Historical cost profit for the financial year............... 16.2 12.2 20.2
==== ==== ====
</TABLE>
F-100
<PAGE>
NFC MOVING SERVICES GROUP
COMBINED CASH FLOW STATEMENT (I)
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
------------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
NET CASH INFLOW FROM OPERATING ACTIVITIES................... 17.5 33.6 36.3
RETURNS ON INVESTMENTS END SERVICING OF FINANCE
Interest received........................................... 2.2 2.4 3.7
Interest paid............................................... (0.2) (0.2) (0.3)
NFC Group interest (net).................................... (3.0) (4.6) (3.0)
----- ----- -----
NET CASH INFLOW/OUTFLOW FROM RETURNS ON INVESTMENTS AND
SERVICING OF FINANCE (ii)................................. (1.0) (2.4) 0.4
TAXATION
UK corporation tax paid..................................... (0.1) -- (1.9)
Overseas tax paid........................................... (6.9) (1.9) (5.2)
NFC Group tax (net)......................................... (1.0) (3.1) (2.8)
----- ----- -----
TAX PAID (ii)............................................... (8.0) (5.0) (9.9)
----- ----- -----
CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT
Purchases of property, plant and equipment.................. (9.9) (12.2) (15.0)
Purchases of investments (net).............................. (2.4) (3.0) (4.3)
Disposals of property, plant and equipment.................. (10.5) 1.2 3.6
----- ----- -----
NET CASH OUTFLOW FROM CAPITAL EXPENDITURE AND FINANCIAL
INVESTMENT................................................ (1.8) (14.0) (15.7)
----- ----- -----
FREE CASH FLOW.............................................. 6.7 12.2 11.1
ACQUISITIONS AND DISPOSALS
Purchases of subsidiary undertakings--(Note 20)............. (0.7) (1.3) (0.3)
----- ----- -----
NET CASH INFLOW BEFORE FINANCING............................ 6.0 10.9 10.8
NET CASH OUTFLOW FROM FINANCING (ii)--(NOTE 20)............. (6.5) (7.8) (7.3)
----- ----- -----
(DECREASE)/INCREASE IN CASH--(NOTE 20)...................... (0.5) (3.1) 3.5
===== ===== =====
RECONCILIATION OF OPERATING PROFIT TO OPERATING CASH FLOW
OPERATING PROFIT............................................ 15.7 19.0 24.5
Depreciation................................................ 8.3 8.4 9.0
Profit on disposals of tangible fixed assets................ -- (0.1) (0.1)
Movements in provisions--(Note 20).......................... 0.2 3.2 4.3
Movements in working capital--(Note 20)..................... (6.7) 3.1 (1.4)
----- ----- -----
NET CASH INFLOW FROM OPERATING ACTIVITIES................... 17.5 33.6 36.3
===== ===== =====
</TABLE>
- ------------------------
(i) The significant differences between the combined cash flow statements
presented above and those required under US generally accepted accounting
principles are described in Note 22 of Notes to the Combined Financial
Statements.
(ii) Net interest received/(paid), tax paid and financing cash flows are not
necessarily representative of the amounts that would have occurred in NFC
Moving Services Group on a stand-alone basis or that will occur in NFC
Moving Services Group in the future.
F-101
<PAGE>
NFC MOVING SERVICES GROUP
COMBINED STATEMENTS OF CHANGES IN NFC GROUP INVESTMENT
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
---------------------------------------------
1996 1997 1998
------------- ------------- -------------
(L MILLION)
<S> <C> <C> <C>
Profit for the financial year............................... 8.9 11.8 20.0
NFC Group funding/(divestment) (net)........................ (7.8) 2.1 (1.8)
Unrealized surplus/(deficit) on revaluation of properties... (0.7) 0.4 0.7
Goodwill on acquisitions.................................... (1.1) (0.5) --
Exchange differences........................................ 0.3 (0.6) (2.0)
------------- ------------- -------------
Movement in year............................................ (0.4) 13.2 16.9
Opening balance............................................. 19.5 19.1 32.3
------------- ------------- -------------
Closing balance (i)......................................... 19.1 32.3 49.2
============= ============= =============
</TABLE>
- ------------------------
(i) At September 30, 1998, the cumulative goodwill written off, excluding that
relating to undertakings disposed of, was L63.4 million
(1997--L63.4 million).
F-102
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS
NOTE 1--BASIS OF PREPARATION
Under a draft proposed agreement, NA Holding Corporation will acquire all of
the moving services businesses and assets (NFC Moving Services Group) of NFC
plc.
These combined financial statements have been prepared to show the
performance of NFC Moving Services Group for the three years ended
September 30, 1998 as if it had been in existence from October 1, 1995. They are
based on the audited financial information of the NFC Group as if the businesses
which comprise NFC Moving Services Group had been part of NFC Moving Services
Group for all of this three year period.
The funding of NFC Moving Services Group's operations included share
capital, loans from NFC plc group companies (both interest free and interest
bearing) and/or external borrowings. These combined financial statements include
interest income and expense actually earned by or charged to NFC Moving Services
Group in respect of external deposits or borrowings or deposits with or
borrowings from members of the NFC Group not included in NFC Moving Services
Group. These amounts are not necessarily representative of the amounts that
would have been earned or incurred by NFC Moving Services Group on a stand-alone
basis or that will arise in NFC Moving Services Group in the future.
The businesses within NFC Moving Services Group have been included in the
tax arrangements of the NFC Group. These combined financial statements include
tax charges and cash flows actually borne by the businesses within NFC Moving
Services Group. These charges and cash flows are not necessarily representative
of the charges or cash flows that would have arisen in NFC Moving Services Group
on a stand-alone basis or that will arise in NFC Moving Services Group in the
future.
These combined financial statements include an allocation of NFC Group's
central overhead costs based on the level of operating profit. Management
believes that this is a reasonable basis for allocation. These amounts are not
necessarily representative of the amounts that would have arisen in NFC Moving
Services Group on a stand-alone basis or that will arise in NFC Moving Services
Group in the future.
NOTE 2--ACCOUNTING POLICIES
(A) ACCOUNTING CONVENTION
The combined financial statements are prepared under the historical cost
convention as modified by the revaluation of certain land and buildings and are
in accordance with all applicable UK accounting standards, including Financial
Reporting Standard 12, Provisions, Contingent Liabilities and Contingent Assets.
Operational freehold and long leasehold land and buildings are revalued to
existing use value over a five year rolling period.
(B) FOREIGN CURRENCIES
Assets, liabilities, revenues and costs denominated in foreign currencies
are recorded at the rates of exchange ruling at the date of the transactions;
monetary assets and liabilities at balance sheet dates are translated at year
end rates of exchange. All exchange differences thus arising are reported as
part of the result for the relevant year.
On combination, the results of businesses accounting in foreign currencies
are translated at average rates of exchange ruling during the relevant year. The
assets and liabilities of such businesses are translated at rates ruling at
balance sheet dates. Differences arising on net investment in overseas
businesses are taken to NFC Group Investment.
F-103
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 2--ACCOUNTING POLICIES (CONTINUED)
(C) FIXED ASSETS AND DEPRECIATION
Depreciation of property, plant and equipment (excluding freehold land,
which is not depreciated) is calculated on straight line basis at rates
estimated to write off the whole of the revalued amount or cost of each asset
over its estimated useful life. Assets which are not expected to be held for the
whole of their useful life are written down to estimated residual values at the
expected times of disposal. The categories of property, plant and equipment are
as follows.
<TABLE>
<S> <C>
Freehold buildings The maximum useful life is estimated at 50 years.
Leasehold land and buildings Costs are written off over the terms of the leases or, in
respect of buildings, the estimated remaining life if
shorter.
Revenue earning vehicles, plant Estimated lives are mainly five to ten years with a few
and equipment exceptions for specialized equipment, for which the maximum
estimated life is 15 years.
</TABLE>
Disposals of land and buildings are taken into account when sale agreements
have been entered into prior to the balance sheet date, provided that the
disposal has been completed before the UK statutory accounts are approved.
(D) LEASED ASSETS
Assets held under leasing arrangements which transfer substantially all the
risks and rewards of ownership to the businesses are capitalized. The capital
element of the related rental obligations is included in accounts payable. The
interest element of the rental obligations is charged to the profit and loss
account so as to produce a constant periodic rate of charge on the remaining
balance of the obligation. Hire purchase arrangements, which are not separately
distinguished, are dealt with similarly. Rentals for other leased assets
acquired under the terms of operating leases are charged directly to the profit
and loss account on the straight line basis over the terms of the leases.
(E) NET SALES
Net sales comprise the value of charges, exclusive of value added tax and
equivalent taxes, made to outside parties for services rendered.
(F) GOODWILL
Goodwill arising on acquisitions is set off against NFC Group Investment. On
the disposal of a business, any goodwill relating thereto that can be identified
and has not previously been charged to profit and loss account is included in
the profit or loss on disposal.
(G) DEFERRED TAXATION
Deferred taxation is provided at expected future rates of tax on all timing
differences to the extent that it is probable that a liability or asset will
crystallize.
F-104
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 2--ACCOUNTING POLICIES (CONTINUED)
(H) PENSIONS
The UK businesses included in these financial statements contribute to the
NFC Retirement Plan for the funding of retirement benefits for each scheme
member during his or her working life in order to pay benefits to them after
retirement and to their dependents after their death. The regular cost of
providing these benefits is assessed by external professional actuaries and is
charged to the combined profit and loss account. Overseas businesses make
provisions for pensions in accordance with local law and practice. There are no
other post-retirement benefits.
(I) SURPLUS PROPERTIES
When properties become surplus to requirements, a provision for holding
costs through to estimated disposal dates is charged to the combined profit and
loss account.
NOTE 3--EXCHANGE RATES
The significant exchange rates relative to L sterling used in the
preparation of these financial statements are as follows. Average rates are
weighted according to monthly net sales.
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
---------------------------------------------------------------
1996 1997 1998
------------------- ------------------- -------------------
AVERAGE YEAR END AVERAGE YEAR END AVERAGE YEAR END
RATE RATE RATE RATE RATE RATE
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Australian dollar.......... 2.01 1.98 2.12 2.23 2.57 2.87
United States dollar....... 1.54 1.56 1.63 1.62 1.65 1.70
==== ==== ==== ==== ==== ====
</TABLE>
NOTE 4--NET SALES
<TABLE>
<CAPTION>
YEARS ENDED
SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
United Kingdom and Ireland............................. 106.8 117.6 120.1
Continental Europe..................................... 24.2 21.0 20.7
Americas............................................... 475.6 488.9 507.3
Asia Pacific........................................... 51.5 53.2 50.2
----- ----- -----
658.1 680.7 698.3
===== ===== =====
</TABLE>
The analysis of net sales is by management structure. The analysis by
destination would not be materially different. Net sales between geographical
segments are not material.
F-105
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 5--OPERATING CHARGES
<TABLE>
<CAPTION>
YEARS ENDED
SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
Raw materials, consumables and other purchases......... 13.0 11.7 12.7
Staff costs
wages and salaries................................... 76.4 80.2 82.1
social security costs................................ 7.6 7.7 7.0
other pension costs--(Note 14)....................... 3.0 3.3 2.5
Depreciation........................................... 8.3 8.4 9.0
Operating lease rentals (including short term hire)
vehicles, plant and equipment........................ 6.2 6.4 5.1
land and buildings................................... 11.9 11.1 10.8
Redundancy............................................. 0.2 0.2 --
Auditors' remuneration................................. 0.3 0.3 0.3
Exceptional costs of reorganization.................... 3.0 2.3 1.6
Sub-contractors' and agents' charges................... 437.4 447.2 447.9
Other operating charges................................ 75.1 82.9 94.8
----- ----- -----
642.4 661.7 673.8
===== ===== =====
</TABLE>
The remuneration of the auditors for non-audit work amounted to
L0.1 million (1997--Lnil, 1996 Lnil) in respect of UK businesses and Lnil
(1997--L0.1 million, 1996--L0.1 million) in respect of overseas businesses.
NOTE 6--EMPLOYEES
The average number of persons employed during each year was as follows:
<TABLE>
<CAPTION>
YEARS ENDED
SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
<S> <C> <C> <C>
United Kingdom and Ireland............................. 1,745 1,783 1,763
Continental Europe..................................... 336 320 336
Americas............................................... 829 871 906
Asia Pacific........................................... 677 742 802
----- ----- -----
3,587 3,716 3,807
===== ===== =====
</TABLE>
F-106
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 6--EMPLOYEES (CONTINUED)
The number of persons employed at the end of each year was as follows:
<TABLE>
<CAPTION>
YEARS ENDED
SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
<S> <C> <C> <C>
United Kingdom and Ireland............................. 1,745 1,770 1,651
Continental Europe..................................... 335 330 339
Americas............................................... 848 876 890
Asia Pacific........................................... 702 762 813
----- ----- -----
3,630 3,738 3,693
===== ===== =====
</TABLE>
NOTE 7--OPERATING PROFIT
<TABLE>
<CAPTION>
YEARS ENDED
SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
United Kingdom and Ireland............................. 8.7 11.4 13.2
Continental Europe..................................... (0.2) 0.5 1.6
Americas............................................... 7.8 7.7 9.1
Asia Pacific........................................... 2.4 1.7 2.2
----- ----- -----
18.7 21.3 26.1
===== ===== =====
Exceptional items
United Kingdom and Ireland........................... (1.4) (0.7) (1.2)
Continental Europe................................... (0.7) (0.6) (0.4)
Americas............................................. (0.9) (1.0) --
----- ----- -----
15.7 19.0 24.5
===== ===== =====
</TABLE>
F-107
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 8--INTEREST (NET) (i)
<TABLE>
<CAPTION>
YEARS ENDED
SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
Interest on bank loans and overdrafts.................. (0.2) (0.2) (0.3)
NFC Group interest payable............................. (5.1) (6.7) (7.5)
----- ----- -----
(5.3) (6.9) (7.8)
Interest income........................................ 2.4 2.5 3.5
NFC Group interest receivable.......................... 2.2 2.2 4.5
----- ----- -----
(0.7) (2.2) 0.2
===== ===== =====
</TABLE>
- ------------------------
(i) As explained in Note 1, interest (net) is not necessarily representative of
the income and charges that would have been reported by NFC Moving Services
Group on a stand-alone basis or that will be reported by NFC Moving Services
Group in the future.
NOTE 9--TAXATION (i)
The analysis of the taxation charge is as follows:
<TABLE>
<CAPTION>
YEARS ENDED
SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
UK corporation tax at 31% (1997--32%, 1996--33%)....... 3.3 4.8 3.7
Double taxation relief................................. (0.1) (0.1) (0.1)
Deferred corporation tax............................... 0.1 0.1 0.1
Overseas taxes--current................................ 2.8 2.8 4.1
--deferred................................. 2.0 (1.0) (1.7)
Adjustments relating to prior years--United Kingdom.... -- -- (0.1)
--overseas............... (3.1) 0.6 (1.4)
----- ----- -----
5.0 7.2 4.6
===== ===== =====
On ordinary activities before exceptional items........ 4.0 6.6 5.0
On exceptional items................................... 1.0 0.6 (0.4)
----- ----- -----
5.0 7.2 4.6
===== ===== =====
</TABLE>
- ------------------------
(i) As explained in Note 1, taxation is not necessarily representative of the
charges that would have been reported by NFC Moving Services Group on a
stand-alone basis or that will be reported by NFC Moving Services Group in
the future.
F-108
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 10--PROPERTY, PLANT AND EQUIPMENT
<TABLE>
<CAPTION>
LAND AND BUILDINGS
-------------------------------- REVENUE PLANT
LONG SHORT EARNING AND
FREEHOLD LEASEHOLD LEASEHOLD VEHICLES EQUIPMENT TOTAL
-------- --------- --------- -------- ---------- --------
(L MILLION)
<S> <C> <C> <C> <C> <C> <C>
COST OR VALUATION
OCTOBER 1, 1995............................................. 27.1 1.3 1.2 22.6 32.1 84.3
Exchange differences........................................ -- -- -- 0.2 0.4 0.6
Additions
by purchase of businesses................................. -- -- -- 0.2 -- 0.2
other..................................................... 0.2 -- -- 4.6 5.1 9.9
Disposals................................................... (9.8) -- -- (1.9) (1.9) (13.6)
Arising on revaluations..................................... (1.1) -- -- -- -- (1.1)
---- ---- ---- ---- ---- -----
SEPTEMBER 30, 1996.......................................... 16.4 1.3 1.2 25.7 35.7 80.3
Exchange differences........................................ (0.7) -- (0.1) (1.0) (1.8) (3.6)
Additions................................................... -- -- 0.2 6.6 5.4 12.2
Disposals................................................... -- (0.3) -- (1.3) (0.7) (2.3)
---- ---- ---- ---- ---- -----
SEPTEMBER 30, 1997.......................................... 15.7 1.0 1.3 30.0 38.6 86.6
Exchange differences........................................ (0.6) -- -- (1.4) (2.7) (4.7)
Additions................................................... -- -- -- 7.2 7.8 15.0
Disposals................................................... -- (0.1) (0.3) (2.2) (1.0) (3.6)
Arising on revaluations..................................... 0.3 -- -- -- -- 0.3
---- ---- ---- ---- ---- -----
SEPTEMBER 30, 1998.......................................... 15.4 0.9 1.0 33.6 42.7 93.6
==== ==== ==== ==== ==== =====
DEPRECIATION AND AMORTIZATION
OCTOBER 1, 1995............................................. 2.3 0.1 0.8 10.0 18.1 31.3
Exchange differences........................................ -- -- -- 0.1 0.3 0.4
Charge for year............................................. 0.4 -- 0.1 3.4 4.4 8.3
Disposals................................................... (1.3) -- -- (1.2) (0.7) (3.2)
Released on revaluations.................................... (0.4) -- -- -- -- (0.4)
---- ---- ---- ---- ---- -----
SEPTEMBER 30, 1996.......................................... 1.0 0.1 0.9 12.3 22.1 36.4
Exchange differences........................................ (0.1) -- (0.1) (0.6) (1.1) (1.9)
Charge for year............................................. 0.4 -- 0.1 3.6 4.3 8.4
Disposals................................................... -- -- -- (0.7) (0.6) (1.3)
Released on revaluations.................................... (0.4) -- -- -- -- (0.4)
---- ---- ---- ---- ---- -----
SEPTEMBER 30, 1997.......................................... 0.9 0.1 0.9 14.6 24.7 41.2
Exchange differences........................................ (0.1) -- (0.1) (0.8) (1.6) (2.6)
Charge for year............................................. 0.5 -- 0.1 3.9 4.5 9.0
Disposals................................................... (0.1) -- (0.2) (1.3) (0.8) (2.4)
Released on revaluations.................................... (0.3) (0.1) -- -- -- (0.4)
---- ---- ---- ---- ---- -----
SEPTEMBER 30, 1998.......................................... 0.9 -- 0.7 16.4 26.8 44.8
==== ==== ==== ==== ==== =====
NET BOOK VALUE
September 30, 1996.......................................... 15.4 1.2 0.3 13.4 13.6 43.9
September 30, 1997.......................................... 14.8 0.9 0.4 15.4 13.9 45.4
September 30, 1998.......................................... 14.5 0.9 0.3 17.2 15.9 48.8
==== ==== ==== ==== ==== =====
</TABLE>
The revaluations of operational properties during Fiscal 1998 were made as
at April 30, 1998 by firms of Chartered Surveyors or their overseas equivalents
on the basis of existing use value.
F-109
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 10--PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Cost or valuation of land and buildings comprise:
<TABLE>
<CAPTION>
SEPTEMBER 30
---------------------------------------------------------------------------------------------
1997 1998
--------------------------------------------- ---------------------------------------------
LONG SHORT LONG SHORT
FREEHOLD LEASEHOLDS LEASEHOLDS TOTAL FREEHOLD LEASEHOLDS LEASEHOLDS TOTAL
-------- ---------- ---------- -------- -------- ---------- ---------- --------
(L MILLION)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
At cost.......................... 1.5 -- 1.3 2.8 0.2 -- 1.0 1.2
At valuation on
October 2, 1993................ 3.0 0.7 -- 3.7 -- -- -- --
October 1, 1994................ 4.4 0.3 -- 4.7 4.1 0.3 -- 4.4
September 30, 1995............. 0.9 -- -- 0.9 0.9 -- -- 0.9
April 30, 1996................. 3.5 -- -- 3.5 3.5 -- -- 3.5
April 30, 1997................. 2.4 -- -- 2.4 2.1 -- -- 2.1
April 30, 1998................. -- -- -- -- 4.6 0.6 -- 5.2
---- --- --- ---- ---- --- --- ----
15.7 1.0 1.3 18.0 15.4 0.9 1.0 17.3
==== === === ==== ==== === === ====
</TABLE>
Under the historical cost convention, land and buildings would have been
shown at the following amounts:
<TABLE>
<CAPTION>
SEPTEMBER 30
--------------------------------------------------------------------------
1997 1998
---------------------------------- ----------------------------------
NET BOOK NET BOOK
COST DEPRECIATION VALUE COST DEPRECIATION VALUE
---- ------------ -------- -------- ------------ --------
(L MILLION)
<S> <C> <C> <C> <C> <C> <C>
Freeholds............................. 11.7 2.2 9.5 11.0 2.2 8.8
Long leaseholds....................... 0.5 0.2 0.3 0.4 0.2 0.2
Short leaseholds...................... 1.3 0.9 0.4 1.0 0.7 0.3
---- --- ---- ---- --- ---
13.5 3.3 10.2 12.4 3.1 9.3
==== === ==== ==== === ===
</TABLE>
NOTE 11--INVESTMENTS
<TABLE>
<CAPTION>
COST
(L MILLION)
<S> <C>
OCTOBER 1, 1996............................................. 20.6
Exchange differences........................................ (0.7)
Additions (net)............................................. 3.0
----
SEPTEMBER 30, 1997.......................................... 22.9
Exchange differences........................................ (1.2)
Additions (net)............................................. 4.3
----
SEPTEMBER 30, 1998.......................................... 26.0
====
</TABLE>
The investments are listed and their market value was L26.3 million
(1997--L24.3 million).
F-110
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 12--DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
<TABLE>
<CAPTION>
SEPTEMBER 30
-------------------
1997 1998
-------- --------
(L MILLION)
<S> <C> <C>
Trade debtors............................................... 96.2 90.7
Amounts owned by NFC Group businesses....................... 62.2 76.3
Other debtors............................................... 12.5 10.5
Prepayments and accrued income.............................. 4.9 4.1
----- -----
175.8 181.6
===== =====
</TABLE>
NOTE 13--DEBTORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
<TABLE>
<CAPTION>
SEPTEMBER 30
-----------------------
1997 1998
-------- --------
(L MILLION)
<S> <C> <C>
Other debtors and prepayments............................... 4.6 4.2
=== ===
</TABLE>
NOTE 14--CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
<TABLE>
<CAPTION>
SEPTEMBER 30
-------------------
1997 1998
-------- --------
(L MILLION)
<S> <C> <C>
Bank overdrafts............................................. 0.5 2.2
Trade creditors............................................. 40.7 36.3
Amounts owned by NFC Group businesses....................... 110.0 114.1
Taxation.................................................... 9.8 6.2
Other taxes and social security............................. 3.3 3.9
Other creditors............................................. 21.6 28.1
Accruals and deferred income................................ 23.4 15.7
----- -----
209.3 206.5
===== =====
</TABLE>
F-111
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 15--PROVISIONS FOR LIABILITIES AND CHARGES
<TABLE>
<CAPTION>
SURPLUS DEFERRED
PROPERTIES INSURANCE TAXATION OTHER TOTAL
---------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
OCTOBER 1, 1995.................................... 1.3 17.6 0.2 1.8 20.9
Exchange differences............................... -- 0.2 -- -- 0.2
Charged to profit and loss account................. -- 25.9 2.1 (0.3) 27.7
Utilized........................................... (0.5) (24.4) -- (0.5) (25.4)
---- ----- ---- ---- -----
SEPTEMBER 30, 1996................................. 0.8 19.3 2.3 1.0 23.4
Exchange differences............................... -- (0.8) (0.1) (0.1) (1.0)
Charged to profit and loss account................. 0.3 27.9 (0.9) 0.3 27.6
Utilized........................................... (0.1) (24.9) -- (0.3) (25.3)
---- ----- ---- ---- -----
SEPTEMBER 30, 1997................................. 1.0 21.5 1.3 0.9 24.7
Exchange differences............................... -- (1.2) -- -- (1.2)
Charged to profit and loss account................. -- 33.0 (1.6) -- 31.4
Utilized........................................... (0.2) (28.4) -- (0.1) (28.7)
---- ----- ---- ---- -----
SEPTEMBER 30, 1998................................. 0.8 24.9 (0.3) 0.8 26.2
==== ===== ==== ==== =====
</TABLE>
The major components of the provision for deferred taxation and the amounts
not provided are as follows:
<TABLE>
<CAPTION>
PROVIDED NOT PROVIDED
---------------------- ----------------------
SEPTEMBER 30 SEPTEMBER 30
---------------------- ----------------------
1997 1998 1997 1998
-------- -------- -------- --------
(L MILLION)
<S> <C> <C> <C> <C>
Accelerated tax depreciation.................. 0.9 1.2 1.9 2.4
Other (provisions, losses, etc.).............. 0.4 (1.5) (13.5) (12.6)
--- ---- ----- -----
1.3 (0.3) (11.6) (10.2)
=== ==== ===== =====
</TABLE>
The above summary does not include any liability to tax on capital gains
which might arise if land and building were to be sold at their revalued
amounts.
NOTE 16--PENSIONS
The UK businesses covered by these combined financial statements participate
in the NFC Retirement Plan which is fully funded. It is a defined benefit plan,
except for that part of it for members under 40 which is a defined contribution
plan. The assets of the Plan are held in trust funds independent of the
participating businesses. The Plan has a surplus which is recognized and
disclosed in the financial statements of NFC plc but none of which has been
allocated to any of the businesses covered by these financial statements.
Employer and employee contributions to the Plan are determined across
participating businesses in the NFC Group in consultation with external
professional actuaries, whose latest valuation was made as at March 31, 1997.
The charge in these combined financial statements in respect of the Plan is the
regular cost of benefits accruing.
The majority of overseas plans are defined contribution plans. The Allied
Van Lines retirement program consisted of a defined benefit plan and a defined
contribution plan. These plans were terminated on December 31, 1997 and the
accrued benefits frozen. The terminated plans have been replaced by defined
contribution plans. The latest actuarial valuations of overseas defined benefit
plans show that they are adequately funded.
F-112
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 17--NET OPERATING ASSETS
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
------------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
United Kingdom and Ireland........................... 23.3 27.6 31.6
Continental Europe................................... 2.4 2.2 3.2
Americas............................................. 23.9 17.1 10.0
Asia Pacific......................................... 7.4 7.5 5.5
----- ----- -----
57.0 54.4 50.3
Less non-operating liabilities (net)................. (37.9) (22.1) (1.1)
----- ----- -----
19.1 32.3 49.2
===== ===== =====
</TABLE>
Net assets comprise tangible fixed assets, stocks and debtors less creditors
and provisions. Non-operating liabilities comprise investments, net cash,
taxation and related items.
NOTE 18--FINANCIAL COMMITMENTS
CAPITAL COMMITMENTS
<TABLE>
<CAPTION>
SEPTEMBER 30
-----------------------
1997 1998
-------- --------
(L MILLION)
<S> <C> <C>
Contracted.................................................. 2.2 3.0
=== ===
</TABLE>
OPERATING LEASES
There were commitments during the next financial year in respect of
noncancelable operating leases as follows:
<TABLE>
<CAPTION>
SEPTEMBER 30
----------------------------------------------
1997 1998
-------------------- --------------------
VEHICLES, VEHICLES,
PLANT AND PLANT AND
PROPERTY EQUIPMENT PROPERTY EQUIPMENT
-------- --------- -------- ---------
(L MILLION)
<S> <C> <C> <C> <C>
Operating leases which expire
within one year.................... 0.5 0.3 0.4 0.5
in the second to fifth years
inclusive........................ 2.6 1.1 5.1 1.9
in the sixth and subsequent
years............................ 5.1 -- 2.6 --
--- --- --- ---
8.2 1.4 8.1 2.4
=== === === ===
</TABLE>
F-113
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 18--FINANCIAL COMMITMENTS (CONTINUED)
Total commitments were as follows:
<TABLE>
<CAPTION>
SEPTEMBER 30
----------------------------------------------
1997 1998
-------------------- --------------------
VEHICLES, VEHICLES,
PLANT AND PLANT AND
PROPERTY EQUIPMENT PROPERTY EQUIPMENT
-------- --------- -------- ---------
(L MILLION)
<S> <C> <C> <C> <C>
Amounts payable
within one year.................... 8.2 1.4 8.1 2.4
between one and five years......... 25.5 2.1 23.7 2.1
after five years................... 22.1 -- 15.8 --
---- --- ---- ---
55.8 3.5 47.6 4.5
==== === ==== ===
</TABLE>
A large proportion of operating leases in respect of land and buildings is
subject to rent reviews.
NOTE 19--CONTINGENT LIABILITIES
The nature of the businesses included in these financial statements and the
extent of their operations are such that they are from time to time involved in
legal proceedings, as plaintiff or defendant. No such proceedings as of
September 30, 1998, are expected to have a material effect on these businesses.
One of the UK businesses included in these financial statements, together
with businesses not so included, has given cross guarantees to and entered into
set off arrangements with bankers which guarantee and offset any monies owing or
owed from time to time, including principal, interest and other related charges,
in respect of the cash management facilities of the NFC Group. At September 30,
1998, the relevant business had no liabilities under these arrangements.
Some of the companies included in these financial statements are guarantors
of agreements entered into by NFC plc for the provision of borrowing facilities
and they are jointly and severally liable for all borrowing thereunder. At
September 30, 1998, there were no drawings under these facilities.
One of the businesses included in these financial statements is a user and
another is a guarantor of letters of credit made in the ordinary course of
business; no liabilities are expected to arise under these arrangements.
For VAT purposes, the UK businesses included in these financial statements
were members of the Pickfords VAT group, under which they had joint and several
liability for amounts due by other members of that group. Since September 30,
1998, those businesses have joined the NFC VAT group and they are jointly and
severally liable for amounts due by other members (including businesses not
included in these accounts) of that VAT group.
F-114
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 20--CONSOLIDATED CASH FLOW STATEMENTS
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
------------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
MOVEMENTS IN PROVISIONS
Insurance................................................... 1.5 3.0 4.6
Surplus property............................................ (0.5) 0.2 (0.2)
Other....................................................... (0.8) -- (0.1)
----- ---- -----
0.2 3.2 4.3
===== ==== =====
MOVEMENTS IN WORKING CAPITAL
Inventories................................................. (0.1) (0.8) 0.1
Receivables................................................. (15.1) (3.2) 0.5
Payables.................................................... 8.5 7.1 (2.0)
----- ---- -----
(6.7) 3.1 (1.4)
===== ==== =====
ACQUISITIONS
Consideration and costs..................................... 0.7 0.9 --
Deferred consideration...................................... (0.6) -- --
Previous deferred consideration settled..................... 0.6 0.4 0.3
----- ---- -----
Cash paid................................................... 0.7 1.3 0.3
===== ==== =====
FINANCING
NFC Group funding (net)..................................... (6.2) (7.6) (7.3)
Debt falling due within one year--repayments................ (0.2) (0.2) --
Capital element of finance lease rental payments............ (0.1) -- --
----- ---- -----
(6.5) (7.8) (7.3)
===== ==== =====
</TABLE>
CASH
<TABLE>
<CAPTION>
BANK
CASH OVERDRAFTS TOTAL
-------- ---------- --------
(L MILLION)
<S> <C> <C> <C>
OCTOBER 1, 1995............................................. 12.4 (0.6) 11.8
Exchange differences........................................ 0.1 -- 0.1
Movements................................................... (0.8) 0.3 (0.5)
----- ----- -----
SEPTEMBER 30, 1996.......................................... 11.7 (0.3) 11.4
Exchange differences........................................ (1.1) -- (1.1)
Movements................................................... 3.3 (0.2) 3.1
----- ----- -----
SEPTEMBER 30, 1997.......................................... 13.9 (0.5) 13.4
Exchange differences........................................ (1.2) 0.1 (1.1)
Movements................................................... 5.3 (1.8) 3.5
----- ----- -----
SEPTEMBER 30, 1998.......................................... 18.0 (2.2) 15.8
===== ===== =====
</TABLE>
F-115
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 20--CONSOLIDATED CASH FLOW STATEMENTS (CONTINUED)
LOAN AND FINANCE LEASE OBLIGATIONS
<TABLE>
<CAPTION>
FINANCE
LOANS LEASES
-------- --------
(L MILLION)
<S> <C> <C>
OCTOBER 1, 1995............................................. 0.4 0.1
Repayments.................................................. (0.2) (0.1)
---- ----
SEPTEMBER 30, 1996.......................................... 0.2 --
Repayments.................................................. (0.2) --
---- ----
SEPTEMBER 30, 1997 AND 1998................................. -- --
==== ====
</TABLE>
RECONCILIATION OF CASH
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
---------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
Net cash inflow before financing............................ 6.0 10.9 10.8
Exchange differences........................................ 0.1 (1.1) (1.1)
Net NFC Group funding....................................... (6.2) (7.6) (7.3)
----- ----- -----
Movement in net cash........................................ (0.1) 2.2 2.4
Net cash at beginning of year............................... 11.3 11.2 13.4
----- ----- -----
Net cash at end of year..................................... 11.2 13.4 15.8
===== ===== =====
</TABLE>
ANALYSIS OF NET CASH
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
---------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
Cash at bank and in hand.................................... 11.7 13.9 18.0
Overdrafts.................................................. (0.3) (0.5) (2.2)
Loans....................................................... (0.2) -- --
----- ----- -----
11.2 13.4 15.8
===== ===== =====
</TABLE>
NOTE 21--RELATED PARTY TRANSACTIONS
NFC Moving Services Group does not operate as a separate group and
consequently there were a number of transactions between its businesses and
companies and other businesses and companies within the NFC plc group in the
three years ended September 30, 1998. These included transactions relating to
insurance management and underwriting, pension administration, treasury,
property and taxation management and other central services supported by NFC
plc. The transactions have not been identified individually as it is not
practical to do so. Transitional arrangements have been agreed for the provision
on normal commercial terms of pensions administration and certain other central
services periods after the acquisition.
F-116
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 22-- DIFFERENCES BETWEEN UNITED KINGDOM AND UNITED STATES GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES
The accounting policies under which these combined financial statements have
been prepared conform with accounting principles generally accepted in the
United Kingdom ("UK GAAP"). Such principles differ from those generally accepted
in the United States ("US GAAP") in the following significant respects.
TAXATION: Deferred taxation is provided at expected future rates of tax
using the liability method on all material timing differences where, in the
opinion of the Directors, liabilities or assets will crystallize in the
foreseeable future. Under US GAAP, deferred tax is recognized on all temporary
differences between the tax and book bases of assets and liabilities including
the differences between the assigned fair values and tax bases of assets and
liabilities acquired, subject to a valuation allowance if it is more likely than
not that some or all of a deferred tax asset will not be realised. The taxation
charges included in these combined financial statements are not representative
of those that would have arisen in NFC Moving Services Group on a stand-alone
basis or would arise in NFC Moving Services Group in the future. The
reconciliations below include adjustments required to show taxation charges on a
stand-alone basis.
DISPOSAL OF PROPERTY: Profits and losses on the disposal of property are
taken into account where sale agreements have been entered into prior to the
accounting date and completion of such agreements has taken place before the
date of approval of the UK statutory accounts. Under US GAAP such profits and
losses would only be accounted for if completion had taken place on or before
the accounting date.
REVALUATIONS OF LAND AND BUILDINGS: Certain properties were revalued at
October 1, 1994, September 30, 1995, April 30, 1996, April 30, 1997 and
April 30, 1998 and those revaluations have been incorporated in the financial
statements. Accordingly, in subsequent years the amortization and depreciation
charges are based on the relevant valuations. Under US GAAP property is shown at
cost and amortization and depreciation charges are related thereto.
STAFF COSTS: The Group's policy in respect of holiday pay is to charge it as
it is paid. US GAAP require that account must be taken of all such payments due
but not paid.
PENSION COSTS: Provision is made for the cost of retirement benefits payable
by the NFC Retirement Plan as assessed by external professional actuaries and is
charged to the profit and loss account so as to spread the cost over the period
during which the employer derives benefit from the employee's services. Under US
GAAP, the NFC Retirement Plan would be treated as a multiemployer plan. As such,
the contributions made to the Plan would be recognized as the pension cost in
the year. These financial statements include the regular cost of pensions which
are paid to a company in the NFC Group. As these contributions are not paid by
that company to the Plan, they would, under US GAAP, be treated as distributions
to the NFC Group and would be included in NFC Group Investment.
INVESTMENTS: Under UK GAAP, investments are stated at cost less any
provision for permanent diminution in value. Under US GAAP investments available
for sale are included at market value. Under US GAAP, unrealized gains on
investments are included in comprehensive income.
GOODWILL: Goodwill arising on acquisitions is written off to NFC Group
Investment on acquisition and, on the subsequent sale of a business, is taken
into account in the determination of the gain or loss on sale. Under US GAAP,
goodwill is amortized over its estimated useful life not exceeding 40 years. For
the purposes of the summary below goodwill has been amortized over its estimated
useful life which is estimated to range from 10 to 40 years. From October 1,
1998, goodwill is capitalized and amortized over
F-117
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 22-- DIFFERENCES BETWEEN UNITED KINGDOM AND UNITED STATES GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES (CONTINUED)
its useful life in accordance with FRS 10. On the sale of a business, any
unamortized goodwill relating thereto would be taken into account in the
determination of the gain or loss on the sale. For the purposes of US GAAP, the
businesses periodically evaluate the recoverability of goodwill based on
estimates of future profitability. If an impairment is determined, the amount of
such impairment is calculated based on estimated recoverability.
EXCEPTIONAL ITEMS: Under US GAAP, the presentation of operating profit
before exceptional items and profit before tax and exceptional items is not
permitted. The amounts reported as exceptional items, which include the profit
or loss on disposals of properties and the loss on disposal of operations
reported after operating profit under UK GAAP, would be included in the
determination of operating profit under US GAAP.
The effect of the significant adjustments to profit for the financial year,
comprehensive income and NFC Group investment which would be required if US GAAP
had been applied instead of UK GAAP is summarized below.
<TABLE>
<CAPTION>
YEAR ENDED
SEPTEMBER 30
------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
PROFIT FOR THE FINANCIAL YEAR
Profit for the financial year as reported................... 8.9 11.8 20.0
US GAAP adjustments:
Operating charges
Staff costs--wages and salaries........................... (0.2) (0.2) 0.4
--pensions....................................... 1.6 1.7 1.7
Depreciation and amortization--goodwill................... (0.9) (1.2) (0.9)
-- revaluation of land and
buildings..................... 0.2 0.2 0.2
Profit on disposal of land and buildings.................... 7.2 (2.2) 2.4
Taxation--stand-alone adjustment............................ (0.5) (0.1) (0.5)
Deferred taxation--methodology.............................. 5.9 0.2 (0.6)
--on adjustments above....................... 2.1 (0.4) --
---- ---- ----
15.4 (2.0) 2.7
---- ---- ----
Profit for the financial year as adjusted to accord with US
GAAP...................................................... 24.3 9.8 22.7
==== ==== ====
COMPREHENSIVE INCOME
Total recognized gains and losses as reported............... 8.5 11.6 18.7
US GAAP adjustments:
Adjustments to profit for the financial year as above....... 15.4 (2.0) 2.7
Unrealized (surplus)/deficit on revaluation of properties... 0.7 (0.4) (0.7)
Unrealized holding (losses)/gains on investments............ (0.3) 1.3 (1.1)
Deferred taxation on unrealized holding gains/(losses) on
investments............................................... 0.1 (0.5) 0.4
---- ---- ----
Comprehensive income in accordance with US GAAP............. 24.4 10.0 20.0
==== ==== ====
</TABLE>
F-118
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 22-- DIFFERENCES BETWEEN UNITED KINGDOM AND UNITED STATES GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES (CONTINUED)
<TABLE>
<CAPTION>
SEPTEMBER 30,
---------------------------------------------------------------
NFC GROUP INVESTMENT 1997 1998
- -------------------- ------------------------------ ------------------------------
(L MILLION)
<S> <C> <C> <C> <C> <C> <C>
NFC Group Investment as reported............................ 32.3 49.2
US GAAP adjustments:
Intangible assets--goodwill--cost........................... 34.1 34.1
--amortization................................ (8.5) 25.6 (9.4) 24.7
----- -----
Unrealized holding gains on investments..................... 1.4 0.3
Property, plant and equipment (revaluation)
--cost or valuation............................. (4.6) (4.9)
--depreciation.................................. (1.3) (5.9) (1.5) (6.4)
----- -----
Accounts receivable......................................... (2.4) --
Accruals and deferred income................................ (2.9) (2.5)
Taxation--stand-alone adjustment............................ (0.1) (0.5)
Deferred taxation--methodology.............................. 4.5 3.9
--on adjustments above....................... 1.4 1.8
----- -----
21.6 21.3
----- ----
NFC Group Investment as adjusted to accord with US GAAP..... 53.9 70.5
===== ====
</TABLE>
CASH FLOW STATEMENTS: The consolidated statements of cash flows prepared in
accordance with UK GAAP present substantially the same information as that
required under US GAAP by SFAS 95. These standards differ, however, with regard
to classification of items within the statements and as regards the definition
of cash. Under UK GAAP cash consists of cash in hand and deposits repayable on
demand less advances from banks repayable on demand. Under US GAAP, such bank
advances would not be deducted from cash (see Note 20).
Under UK GAAP, cash flows are presented separately for operating activities,
returns on investments and servicing of finance, taxation, capital expenditure
and financial investment, acquisitions and disposals, dividends paid and
financing activities. US GAAP, however, requires only three categories of cash
flow activity to be reported: operating, investing and financing. Cash flows
from taxation and returns on investments and servicing of finance shown under UK
GAAP would be included as operating activities under US GAAP. The payment of
dividends, including minority dividends, would be included as a financing
activity under US GAAP. Under US GAAP, capitalized interest is treated as part
of the cost of the asset to which it relates and thus is included as part of
investing cash flows; under UK GAAP all interest is treated as part of returns
on investments and servicing of finance. Under US GAAP, cash and cash
equivalents would not include bank overdrafts and borrowings with initial
maturities of less than three months.
F-119
<PAGE>
NFC MOVING SERVICES GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS (CONTINUED)
NOTE 22-- DIFFERENCES BETWEEN UNITED KINGDOM AND UNITED STATES GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES (CONTINUED)
The categories of cash flow activity under US GAAP are summarized below:
<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30
---------------------------------
1996 1997 1998
-------- -------- --------
(L MILLION)
<S> <C> <C> <C>
Cash inflows from operating activities...................... 8.5 26.2 26.8
Cash outflows on investing activities....................... (2.5) (15.3) (16.0)
Cash outflows from financing activities..................... (6.8) (7.6) (5.5)
Effect of exchange rate changes on cash..................... 0.1 (1.1) (1.2)
----- ----- -----
Increase/(decrease) in cash and cash equivalents............ (0.7) 2.2 4.1
Cash and cash equivalents at beginning of year.............. 12.4 11.7 13.9
----- ----- -----
Cash and cash equivalents at end of year.................... 11.7 13.9 18.0
===== ===== =====
</TABLE>
F-120
<PAGE>
- --------------------------------------------------------------------------------
PROSPECTUS
- --------------------------------------------------------------------------------
NORTH AMERICAN VAN LINES, INC.
OFFER TO EXCHANGE ITS
13 3/8% SENIOR SUBORDINATED NOTES DUE 2009
, 2000
- --------------------------------------------------------------------------------
DEALER PROSPECTUS DELIVERY OBLIGATION
Until , 2000, all dealers that effect transactions in these
securities, whether or not participating in this offering, may be required to
deliver a prospectus. This is in addition to the dealers' obligation to deliver
a prospectus when acting as underwriters and with respect to their unsold
allotments or subscriptions.
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF OFFICERS AND DIRECTORS
North American Van Lines' Restated Certificate of Incorporation and its
By-Laws, as amended, authorize the indemnification of officers and directors of
the corporation consistent with Section 145 of the Delaware Corporation Law, as
amended, and to the full extent permitted under Delaware law.
Section 145 of the Delaware Corporation Law, as amended, provides in regards
to indemnification of directors and officers as follows:
"145 INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS;
INSURANCE.--(a) A corporation shall have power to indemnify any person who
was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the corporation) by reason of the fact that the person is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests
of the corporation, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful. The termination
of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not,
of itself, create a presumption that the person did not act in good faith
and in a manner which he reasonably believed to be in or not opposed to the
best interests of the corporation, and, with respect to any criminal action
or proceeding, had reasonable cause to believe that his conduct was
unlawful.
(b) A corporation shall have power to indemnify any person who was or is
a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by the person in connection with the defense or
settlement of such action or suit if the person acted in good faith and in a
manner the person reasonably believed to be in or not opposed to the best
interests of the corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the
extent that the Court of Chancery or the court in which such action or suit
was brought shall determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the case, such person
is fairly and reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
(c) To the extent that a present or former director or officer of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) and (b) of this
section, or in defense of any claim, issue or matter therein, such person
shall be indemnified against expenses (including attorneys' fees) actually
and reasonably incurred by such person in connection therewith.
(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of
the director, officer, employee or agent is proper in the circumstances
because the person has met the applicable standard of conduct set forth in
subsections (a) and (b) of this section.
II-1
<PAGE>
Such determination shall be made, with respect to a person who is a director
or officer at the time of such determination (1) by a majority vote of the
directors who are not parties to such action, suit or proceeding, even
though less than a quorum, or (2) by a committee of such directors
designated by majority vote of such directors, even though less than a
quorum, or (3) if there are no such directors, or if such directors so
direct, by independent legal counsel in a written opinion, or (4) by the
stockholders.
(e) Expenses (including attorney's fees) incurred by an officer or
director in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such amount
if it shall ultimately be determined that such person is not entitled to be
indemnified by the corporation as authorized in this section. Such expenses
(including attorneys' fees) incurred by former directors and officers or
other employees and agents may be so paid upon such terms and conditions, if
any, as the corporation deems appropriate.
(f) The indemnification and advancement of expenses provided by, or
granted pursuant to the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking indemnification
or advancement of expenses may be entitled under any by-law, agreement, vote
of stockholders or disinterested directors or otherwise, both as to action
in such person's official capacity and as to action in another capacity
while holding such office.
(g) A corporation shall have power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted
against such person and incurred by such person in any such capacity, or
arising out of such person's status as such, whether or not the corporation
would have the power to indemnify such person against such liability under
this section.
(h) For purposes of this section, references to "the corporation" shall
include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers, and
employees or agents, so that any person who is or was a director, officer,
employee or agent of such constituent corporation, or is or was serving at
the request of such constituent corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, shall stand in the same position under this section with respect
to the resulting or surviving corporation as such person would have with
respect to such constituent corporation if its separate existence had
continued.
(i) For purposes of this section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include
any excise taxes assessed on a person with respect to any employee benefit
plan; and references to "serving at the request of the corporation" shall
include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such director,
officer, employee, or agent with respect to an employee benefit plan, its
participants or beneficiaries; and a person who acted in good faith and in a
manner such person reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be deemed
to have acted in a manner "not opposed to the best interests of the
corporation" as referred to in this section.
(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person."
II-2
<PAGE>
Article VI of the By-Laws of North American Van Lines authorizes
indemnification of officers and directors in cases of liability if the director
or officer
(1) acted in good faith and in a manner reasonably believed to be or not
opposed to the best interests of the corporation and
(2) with respect to any criminal action, had no reasonable cause to
believe his conduct was unlawful.
In cases involving an action or suit by or on behalf of North American Van
Lines, indemnification is limited to expenses actually or reasonably incurred
and prohibit in cases where the officer or director has been adjudged liable
unless otherwise ordered by the Delaware Court of Chancery or the court in which
the original action or suit was brought. Section 6.01 of the By-Laws of North
American Van Lines further provide that in a cases involving an action or suit
by or on behalf of North American Van Lines, such indemnification is limited to
expenses actually and reasonably incurred by such director or officer and
indemnification of officers and directors to the full extent permitted under
Delaware law, including a provision eliminating (except under certain enumerated
circumstances) the liability of directors for duty of care violations.
In addition, North American Van Lines' Restated Certificate of
Incorporation, consistent with Section 102(b) of the Delaware Corporation Law,
as amended, precludes indemnification of directors in cases of liability of any
director
(1) for any breach of loyalty to the corporation or its stockholders,
(2) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of the law,
(3) for unlawful payments of dividends or unlawful stock repurchases or
redemptions as provided in Section 174 of the Delaware Corporation Law, as
amended and
(4) for any transaction from which the director derived an improper
personal benefit.
The indemnification provided for the Delaware Corporation Law is not
exclusive of any other rights of indemnification, and a corporation may maintain
insurance against liabilities for which indemnification is not expressly
provided by the Delaware Corporation Law.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) List of Exhibits.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------------------- ------------------------------------------------------------
<C> <S>
3.1 Restated Certificate of Incorporation of North American Van
Lines, Inc.
3.2 Amended and Restated By-Laws of North American Van Lines,
Inc.
3.3 Amended Certificate of Incorporation of NA Holding
Corporation, now known as Allied Worldwide, Inc.
3.4 Amended and Restated By-Laws of NA Holding Corporation, now
known as Allied Worldwide, Inc.
3.5 Articles of Incorporation of Fleet Insurance Management,
Inc.
3.6 By-Laws of Fleet Insurance Management, Inc.
3.7 Certificate of Incorporation of FrontRunner Worldwide, Inc.
3.8 By-Laws of FrontRunner Worldwide, Inc.
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------------------- ------------------------------------------------------------
<C> <S>
3.9 Articles of Incorporation of Tri-City Moving & Storage,
Inc., now known as North American Distribution Systems, Inc.
3.10 By-Laws of Tri-City Moving & Storage, Inc. now known as
North American Distribution Systems, Inc.
3.11 Amended Articles of Incorporation of North American Travel
Service, Inc., now known as North American Logistics, Inc.
3.12 By-Laws of North American Travel Service, Inc., now known as
North American Logistics, Inc.
3.13 Amended Articles of Incorporation of North American
Distribution Systems, Inc., now known as NAVTRANS
International Freight Forwarding, Inc.
3.14 By-Laws of North American Distribution Systems, Inc., now
known as NAVTRANS International Freight Forwarding, Inc.
3.15 Certificate of Incorporation of Relocation Management
Systems, Inc.
3.16 By-Laws of Relocation Management Systems, Inc.
3.17 Articles of Incorporation of NACAL, Inc.
3.18 By-Laws of NACAL, Inc.
3.19 Amended Articles of Incorporation of Marlew, Inc., now known
as North American Van Lines of Texas, Inc.
3.20 By-Laws of Marlew, Inc., now known as North American Van
Lines of Texas, Inc.
3.21 Articles of Incorporation of Great Falls North American,
Inc.
3.22 By-Laws of Great Falls North American, Inc.
3.23 Amended Articles of Incorporation of Relocation Solutions
Management, Inc., now known as A Relocation Solutions
Management, Inc.
3.24 By-Laws of Relocation Solutions Management, Inc., now known
as A Relocation Solutions Management, Inc.
3.25 Amended Articles of Incorporation of Allied Sea Van Company,
now known as Allied Freight Forwarding, Inc.
3.26 Restated By-Laws of Allied Van Lines International
Corporation, now known as Allied Freight Forwarding, Inc.
3.27 Amended Certificate of Incorporation of Allied Pickfords
U.S.A., Inc., now known as Allied International N.A., Inc.
3.28 Restated By-Laws of Allied International N.A., Inc.
3.29 Certificate of Agreement of Merger of NFC Merger Corporation
with and into Allied Van Lines, Inc.
3.30 By-Laws of Allied Van Lines, Inc.
3.31 Amended Articles of Incorporation of Allied Van Lines
Insurance Agency, Inc., now known as Vanguard Insurance
Agency, Inc.
3.32 By-Laws of Allied Van Lines Insurance Agency, Inc., now
known as Vanguard Insurance Agency, Inc.
3.33 Certificate of Incorporation of Allied Van Lines Terminal
Company
3.34 Restated By-Laws of Allied Van Lines Terminal Corporation
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------------------- ------------------------------------------------------------
<C> <S>
4.1 Indenture, dated as of November 19, 1999, among North
American Van Lines, State Street Bank and Trust Company and
the subsidiary guarantors party thereto
4.2 Registration Rights Agreement, dated November 19, 1999,
among North American Van Lines, Inc., Banc of America
Securities LLC, Chase Securities Inc. and the subsidiary
guarantors party thereto
4.3 Form of 13 3/8 Senior Subordinated Note due 2009 (included
in Exhibit 4.1)
5.1 Opinion of Debevoise & Plimpton*
10.1 Acquisition Agreement, dated as of September 14, 1999,
between NA Holding Corporation and NFC plc
10.2 Amendment No. 1 to the Acquisition Agreement, dated as of
November 19, 1999, between NA Holding Corporation and NFC
plc
10.3 Credit Agreement, dated as of November 19, 1999 and amended
as of November 23, 1999, among North American Van Lines, the
foreign subsidiary borrowers from time to time parties
thereto, the several banks and other financial institutions
from time to time parties thereto, The Bank of New York, as
documentation agent, Banc of America Securities LLC, as
syndication agent, and The Chase Manhattan Bank, as
collateral and administrative agent
10.4 Guaranty and Collateral Agreement, dated as of November 19,
1999, made by NA Holding Corporation, North American Van
Lines, Inc. and certain of its subsidiaries in favor of The
Chase Manhattan Bank, as collateral agent and administrative
agent
10.5 Common Stock Purchase Warrant No. 1, dated as of November
19, 1999, for 87,480 shares of NA Holding Common Stock,
issued in the name of NFC International Holdings
(Netherlands II) BV
10.6 Indemnification Agreement, dated as of March 30, 1998, among
NA Holding Corporation, NA Acquisition Corporation, North
American Van Lines, Clayton, Dubilier & Rice, Inc. and
Clayton, Dubilier & Rice Fund V Limited Partnership
10.7 Consulting Agreement, dated as of March 30, 1998, by and
among NA Holding Corporation, NA Acquisition Corporation,
and North American Van Lines, Inc. and Clayton, Dubilier &
Rice, Inc.
10.8 Registration and Participation Agreement, dated as of March
30, 1998, among NA Holding Corporation and Clayton,
Dubilier & Rice Fund V Limited Partnership
10.9 Amendment No. 1, dated as of November 19, 1999, to the
Registration and Participation Agreement, dated as of
March 30, 1998, among NA Holding Corporation and Clayton,
Dubilier & Rice Fund V Limited Partnership
10.10 Letter Agreement, dated as of November 19, 1999, among NA
Holding Corporation, Clayton, Dubilier & Rice Fund V Limited
Partnership and NFC plc with respect to rights and
obligations of NFC by virtue of its acquisition of 174,961
shares of common stock, par value $0.01 per share, of NA
Holding Corporation
10.11 Stock Subscription Agreement, dated as of November 19, 1999,
between the NA Holding Corporation and Clayton, Dubilier &
Rice Fund V Limited Partnership
10.12 Stock Subscription Agreement, dated as of November 19, 1999,
between NA Holding Corporation and NFC plc
10.13 Form of Management Stock Subscription Agreement for Allied
Worldwide, Inc. (formerly NA Holding Corporation)
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------------------- ------------------------------------------------------------
<C> <S>
10.14 Form of Management Stock Option Agreement for Allied
Worldwide, Inc. (formerly NA Holding Corporation)
10.15 Transition Services Agreement, dated as of November 19,
1999, by and between NFC plc and NA Holding Corporation
10.16 Tax Matters Agreement, dated as of September 14, 1999,
between NA Holding Corporation and NFC plc
10.17 Amendment No. 1, dated as of April 1, 1998 to the Consulting
Agreement, dated as of March 30, 1998, by and among NA
Holding Corporation, NA Acquisition Corporation, North
American Van Lines, Inc., and Clayton, Dubilier & Rice, Inc.
12.1 Calculation of Ratios
15.1 Letter of PricewaterhouseCoopers LLP regarding unaudited
interim financial information
15.2 Letter of Ernst & Young regarding unaudited interim
financial information
21.1 List of Subsidiaries of North American Van Lines
23.1 Consent of Debevoise & Plimpton (contained in Exhibit 5.1)
23.2 Consent of PricewaterhouseCoopers LLP
23.3 Consent of KPMG
23.4 Consent of Ernst & Young
24.1 Powers of Attorney (contained on signature pages)
25.1 Statement of Eligibility of State Street Bank and Trust on
Form T-1
27.1 Financial Data Schedule
99.1 Form of Letter of Transmittal*
99.2 Form of Notice of Guaranteed Delivery*
99.3 Instruction to Registered Holder and/or Book Entry Transfer
Participant from Beneficial Owner for Tender of 13 3/8
Senior Subordinated Notes Due 2009 for registered 13 3/8
Senior Subordinated Notes Due 2009*
</TABLE>
- ------------------------
* To be filed by amendment.
(b) Financial Statement Schedules.
Financial statement schedules of North American Van Lines for which
provision is made in the applicable accounting regulations of the Securities and
Exchange Commission are not required, are inapplicable or not material, or the
information called for thereby is otherwise included in the financial statements
or related notes and therefore have been omitted.
ITEM 22. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(a) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(b) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which,
II-6
<PAGE>
individually or in the aggregate, represent a fundamental change in
the information set forth the registration statement. Notwithstanding
the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities would not exceed
that which was registered) and any deviation from the low or high end
of the estimated maximum offering range may be reflected in the form
of prospectus filed with the Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement;
(c) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offering therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination
of the offering.
(4) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other
than payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
(5) The undersigned registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus
pursuant to Items 4, 10(b), 11, or 13 of this Form, within one business
day of receipt of such request, and to send the incorporated documents by
first class mail or other equally prompt means. This includes information
contained in documents filed subsequent to the effective date of the
registration statement through the date of responding to the request.
(6) The undersigned registrant hereby undertakes to supply by means of
post-effective amendment all information concerning a transaction, and
the company being acquired involved therein, that was not the subject of
and included in the registration statement when it became effective.
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
NORTH AMERICAN VAN LINES, INC.
By: /s/ JEFFREY P. GANNON
-----------------------------------------
Name: Jeffrey P. Gannon
Title:PRESIDENT AND CHIEF
EXECUTIVE OFFICER
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
Director, President and
/s/ JEFFREY P. GANNON Chief Executive Officer
- ------------------------------------------- (Principal executive February 4, 2000
Jeffrey P. Gannon officer)
/s/ JEFFREY KACZKA Chief Financial Officer
- ------------------------------------------- (Principal financial February 4, 2000
Jeffrey Kaczka officer)
/s/ RONALD L. MILEWSKI Vice President, Controller
- ------------------------------------------- (Principal accounting February 4, 2000
Ronald L. Milewski officer)
/s/ MICHAEL G. BABIARZ Director
- ------------------------------------------- February 4, 2000
Michael G. Babiarz
/s/ EDMUND M. CARPENTER Director
- ------------------------------------------- February 4, 2000
Edmund M. Carpenter
</TABLE>
II-8
<PAGE>
<TABLE>
<S> <C> <C>
/s/ KEVIN J. CONWAY Director
- ------------------------------------------- February 4, 2000
Kevin J. Conway
/s/ ROBERT G. DETTMER Director
- ------------------------------------------- February 4, 2000
Robert G. Dettmer
/s/ DARRYL D. FRY Director
- ------------------------------------------- February 4, 2000
Darryl D. Fry
/s/ KENNETH E. HOMA Director
- ------------------------------------------- February 4, 2000
Kenneth E. Homa
/s/ ROBERT D. LAKE Director
- ------------------------------------------- February 4, 2000
Robert D. Lake
/s/ DAVID A. NOVAK Director
- ------------------------------------------- February 4, 2000
David A. Novak
/s/ CHARLES P. PIEPER Director
- ------------------------------------------- February 4, 2000
Charles P. Pieper
/s/ JAMES W. ROGERS Director
- ------------------------------------------- February 4, 2000
James W. Rogers
</TABLE>
II-9
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
FLEET INSURANCE MANAGEMENT, INC.
By: /s/ JAMES E. PHILLABAUM
-----------------------------------------
Name: James E. Phillabaum
Title: VICE PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ JAMES E. PHILLABAUM Vice President (Principal
- ------------------------------------------- executive officer) February 4, 2000
James E. Phillabaum
/s/ JEFFREY KACZKA (Principal financial
- ------------------------------------------- officer) February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI Treasurer (Principal
- ------------------------------------------- accounting officer) February 4, 2000
Ronald L. Milewski
/s/ RALPH A. FORD Director
- ------------------------------------------- February 4, 2000
Ralph A. Ford
/s/ JEFFREY KACZKA Director
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
</TABLE>
II-10
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
FRONTRUNNER WORLDWIDE, INC.
By: /s/ BARRY C. MEEKS
-----------------------------------------
Name: Barry C. Meeks
Title: TREASURER
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ BARRY C. MEEKS Treasurer (Principal
- ------------------------------------------- executive officer) February 4, 2000
Barry C. Meeks
/s/ JEFFREY KACZKA (Principal financial
- ------------------------------------------- officer) February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI (Principal accounting
- ------------------------------------------- officer) February 4, 2000
Ronald L. Milewski
/s/ GERALD A. BURNS Director
- ------------------------------------------- February 4, 2000
Gerald A. Burns
/s/ JEFFREY KACZKA Director
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
</TABLE>
II-11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
NORTH AMERICAN DISTRIBUTION
SYSTEMS, INC.
By: /s/ J. MICHAEL GUNKEL
-----------------------------------------
Name: J. Michael Gunkel
Title: VICE PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ J. MICHAEL GUNKEL Vice President (Principal
- ------------------------------------------- executive officer) February 4, 2000
J. Michael Gunkel
/s/ JEFFREY KACZKA Vice President (Principal
- ------------------------------------------- financial officer) February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI (Principal accounting
- ------------------------------------------- officer) February 4, 2000
Ronald L. Milewski
/s/ GERALD A. BURNS Director
- ------------------------------------------- February 4, 2000
Gerald A. Burns
/s/ JEFFREY KACZKA Director
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
</TABLE>
II-12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
NORTH AMERICAN LOGISTICS LTD.
By: /s/ J. MICHAEL GUNKEL
-----------------------------------------
Name: J. Michael Gunkel
Title: VICE PRESIDENT AND GENERAL MANAGER
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ J. MICHAEL GUNKEL Vice President and General
- ------------------------------------------- Manager (Principal February 4, 2000
J. Michael Gunkel executive officer)
/s/ JEFFREY KACZKA Vice President (Principal
- ------------------------------------------- financial officer) February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI (Principal accounting
- ------------------------------------------- officer) February 4, 2000
Ronald L. Milewski
/s/ GERALD A. BURNS Director
- ------------------------------------------- February 4, 2000
Gerald A. Burns
/s/ RONALD L MILEWSKI Director
- ------------------------------------------- February 4, 2000
Ronald L. Milewski
</TABLE>
II-13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
NAVTRANS INTERNATIONAL FREIGHT
FORWARDING, INC.
By: /s/ JEFFREY KACZKA
-----------------------------------------
Name: Jeffrey Kaczka
Title: VICE PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
Vice President (Principal
/s/ JEFFREY KACZKA executive officer and
- ------------------------------------------- principal financial February 4, 2000
Jeffrey Kaczka officer)
/s/ RONALD L. MILEWSKI Treasurer (Principal
- ------------------------------------------- accounting officer) February 4, 2000
Ronald L. Milewski
/s/ GERALD A. BURNS Director
- ------------------------------------------- February 4, 2000
Gerald A. Burns
/s/ JEFFREY KACZKA Director
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
</TABLE>
II-14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
RELOCATION MANAGEMENT SYSTEMS, INC.
By: /s/ RALPH A. FORD
-----------------------------------------
Name: Ralph A. Ford
Title: VICE PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ RALPH A. FORD Vice President (Principal
- ------------------------------------------- executive officer) February 4, 2000
Ralph A. Ford
/s/ JEFFREY KACZKA Vice President (Principal
- ------------------------------------------- financial officer) February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI Treasurer (Principal
- ------------------------------------------- accounting officer) February 4, 2000
Ronald L. Milewski
/s/ GERALD A. BURNS Director
- ------------------------------------------- February 4, 2000
Gerald A. Burns
/s/ JEFFREY KACZKA Director
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
</TABLE>
II-15
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
NACAL, INC.
By: /s/ JEFFREY KACZKA
-----------------------------------------
Name: Jeffrey Kaczka
Title: VICE PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
Vice President (Principal
/s/ JEFFREY KACZKA executive officer and
- ------------------------------------------- principal financial February 4, 2000
Jeffrey Kaczka officer)
/s/ RONALD L. MILEWSKI Treasurer (Principal
- ------------------------------------------- accounting officer) February 4, 2000
Ronald L. Milewski
/s/ GERALD A. BURNS Director
- ------------------------------------------- February 4, 2000
Gerald A. Burns
/s/ JEFFREY KACZKA Director
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
</TABLE>
II-16
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
NORTH AMERICAN VAN LINES OF TEXAS, INC.
By: /s/ JEFFREY KACZKA
-----------------------------------------
Name: Jeffrey Kaczka
Title: VICE PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
Vice President (Principal
/s/ JEFFREY KACZKA executive officer and
- ------------------------------------------- principal financial February 4, 2000
Jeffrey Kaczka officer)
/s/ RONALD L. MILEWSKI Treasurer (Principal
- ------------------------------------------- accounting officer) February 4, 2000
Ronald L. Milewski
/s/ GERALD A. BURNS Director
- ------------------------------------------- February 4, 2000
Gerald A. Burns
/s/ JEFFREY KACZKA Director
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
</TABLE>
II-17
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
GREAT FALLS NORTH AMERICAN, INC.
By: /s/ JEFFREY KACZKA
-----------------------------------------
Name: Jeffrey Kaczka
Title: VICE PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
Vice President (Principal
/s/ JEFFREY KACZKA executive officer and
- ------------------------------------------- principal financial February 4, 2000
Jeffrey Kaczka officer)
/s/ RONALD L MILEWSKI Treasurer (Principal
- ------------------------------------------- accounting officer) February 4, 2000
Ronald L. Milewski
/s/ GERALD A. BURNS Director
- ------------------------------------------- February 4, 2000
Gerald A. Burns
/s/ JEFFREY KACZKA Director
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
</TABLE>
II-18
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
ALLIED VAN LINES, INC.
By: /s/ MICHAEL P. FERGUS
-----------------------------------------
Name: Michael P. Fergus
Title: CHIEF EXECUTIVE OFFICER AND
PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ MICHAEL P. FERGUS Chief Executive Officer and
- ------------------------------------------- President (Principal February 4, 2000
Michael P. Fergus executive officer)
/s/ JEFFREY KACZKA (Principal financial
- ------------------------------------------- officer) February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI (Principal accounting
- ------------------------------------------- officer) February 4, 2000
Ronald L. Milewski
/s/ DAVID M. BUTH Director
- ------------------------------------------- February 4, 2000
David M. Buth
/s/ MICHAEL P. FERGUS Director
- ------------------------------------------- February 4, 2000
Michael P. Fergus
</TABLE>
II-19
<PAGE>
<TABLE>
<S> <C> <C>
/s/ ROBERT J. HENRY Director
- ------------------------------------------- February 4, 2000
Robert J. Henry
/s/ BRADLEY J. MCGUIRE Director
- ------------------------------------------- February 4, 2000
Bradley J. McGuire
</TABLE>
II-20
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
ALLIED INTERNATIONAL N.A., INC.
By: /s/ MICHAEL PETERSEN
-----------------------------------------
Name: Michael Petersen
Title: VICE PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ MICHAEL PETERSEN Vice President (Principal
- ------------------------------------------- executive officer) February 4, 2000
Michael Petersen
/s/ JEFFREY KACZKA (Principal financial
- ------------------------------------------- officer) February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI (Principal accounting
- ------------------------------------------- officer) February 4, 2000
Ronald L. Milewski
/s/ DAVID M. BUTH Director
- ------------------------------------------- February 4, 2000
David M. Buth
/s/ MICHAEL P. FERGUS Director
- ------------------------------------------- February 4, 2000
Michael P. Fergus
/s/ MICHAEL PETERSEN Director
- ------------------------------------------- February 4, 2000
Michael Petersen
</TABLE>
II-21
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
ALLIED FREIGHT FORWARDING, INC.
By: /s/ MICHAEL P. FERGUS
-----------------------------------------
Name: Michael P. Fergus
Title: CHAIRMAN OF THE BOARD AND PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ MICHAEL P. FERGUS Chairman of the Board and
- ------------------------------------------- President (Principal February 4, 2000
Michael P. Fergus executive officer)
/s/ JEFFREY KACZKA (Principal financial
- ------------------------------------------- officer) February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI (Principal accounting
- ------------------------------------------- officer) February 4, 2000
Ronald L. Milewski
/s/ DAVID M. BUTH Director
- ------------------------------------------- February 4, 2000
David M. Buth
/s/ MICHAEL PETERSEN Director
- ------------------------------------------- February 4, 2000
Michael Petersen
/s/ BRADLEY J. MCGUIRE Director
- ------------------------------------------- February 4, 2000
Bradley J. McGuire
</TABLE>
II-22
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
A RELOCATION MANAGEMENT SOLUTIONS COMPANY
By: /s/ MICHAEL P. FERGUS
-----------------------------------------
Name: Michael P. Fergus
Title: CHAIRMAN OF THE BOARD AND PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ MICHAEL P. FERGUS Chairman of the Board and
- ------------------------------------------- President (Principal February 4, 2000
Michael P. Fergus executive officer)
/s/ JEFFREY KACZKA (Principal financial officer)
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI (Principal accounting
- ------------------------------------------- officer) February 4, 2000
Ronald L. Milewski
/s/ DAVID M. BUTH Director
- ------------------------------------------- February 4, 2000
David M. Buth
/s/ ROBERT J. HENRY Director
- ------------------------------------------- February 4, 2000
Robert J. Henry
/s/ BRADLEY J. MCGUIRE Director
- ------------------------------------------- February 4, 2000
Bradley J. McGuire
</TABLE>
II-23
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of Ft.
Wayne, State of Indiana, on February 4, 2000.
<TABLE>
<S> <C> <C>
ALLIED VAN LINES TERMINAL COMPANY
By: /s/ MICHAEL P. FERGUS
-----------------------------------------
Name: Michael P. Fergus
Title: CHAIRMAN OF THE BOARD AND PRESIDENT
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ MICHAEL P. FERGUS Chairman of the Board and
- ------------------------------------------- President (Principal February 4, 2000
Michael P. Fergus executive officer)
/s/ JEFFREY KACZKA (Principal financial officer)
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI (Principal accounting
- ------------------------------------------- officer) February 4, 2000
Ronald L. Milewski
/s/ DAVID M. BUTH Director
- ------------------------------------------- February 4, 2000
David M. Buth
/s/ ROBERT J. HENRY Director
- ------------------------------------------- February 4, 2000
Robert J. Henry
/s/ BRADLEY J. MCGUIRE Director
- ------------------------------------------- February 4, 2000
Bradley J. McGuire
</TABLE>
II-24
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement on Form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of
Naperville, State of Illinois, on February 4, 2000.
<TABLE>
<S> <C> <C>
VANGUARD INSURANCE AGENCY, INC.
By: /s/ LAWRENCE A. WRITT
-----------------------------------------
Name: Lawrence A. Writt
Title: PRESIDENT AND CHIEF EXECUTIVE
OFFICER
</TABLE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph A. Ford, Jeffrey Kaczka, and Ronald L.
Milewski, jointly and severally, as his true and lawful attorney-in-fact and
agent, acting alone, with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact full power and authority to do and reform each and every
act and thing requisite or necessary to be done in and about the premises, as
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ LAWRENCE A. WRITT President and Chief Executive
- ------------------------------------------- Officer (Principal February 4, 2000
Lawrence A. Writt executive officer)
/s/ JEFFREY KACZKA (Principal financial officer)
- ------------------------------------------- February 4, 2000
Jeffrey Kaczka
/s/ RONALD L. MILEWSKI (Principal accounting
- ------------------------------------------- officer) February 4, 2000
Ronald L. Milewski
/s/ MICHAEL P. FERGUS Director
- ------------------------------------------- February 4, 2000
Michael P. Fergus
/s/ LAWRENCE A. WRITT Director
- ------------------------------------------- February 4, 2000
Lawrence A. Writt
/s/ MARSHALL B. FELBEIN Director
- ------------------------------------------- February 4, 2000
Marshall B. Felbein
</TABLE>
II-25
<PAGE>
EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------------------- ------------------------------------------------------------
<C> <S>
3.1 Restated Certificate of Incorporation of North American Van
Lines, Inc.
3.2 Amended and Restated By-Laws of North American Van Lines,
Inc.
3.3 Amended Certificate of Incorporation of NA Holding
Corporation, now known as Allied Worldwide, Inc.
3.4 Amended and Restated By-Laws of NA Holding Corporation, now
known as Allied Worldwide, Inc.
3.5 Articles of Incorporation of Fleet Insurance Management,
Inc.
3.6 By-Laws of Fleet Insurance Management, Inc.
3.7 Certificate of Incorporation of FrontRunner Worldwide, Inc.
3.8 By-Laws of FrontRunner Worldwide, Inc.
3.9 Articles of Incorporation of Tri-City Moving & Storage,
Inc., now known as North American Distribution Systems, Inc.
3.10 By-Laws of Tri-City Moving & Storage, Inc., now known as
North American Distribution Systems, Inc.
3.11 Amended Articles of Incorporation of North American Travel
Service, Inc., now known as North American Logistics, Inc.
3.12 By-Laws of North American Travel Service, Inc., now known as
North American Logistics, Inc.
3.13 Amended Articles of Incorporation of North American
Distribution Systems, Inc., now known as NAVTRANS
International Freight Forwarding, Inc.
3.14 By-Laws of North American Distribution Systems, Inc., now
known as NAVTRANS International Freight Forwarding, Inc.
3.15 Certificate of Incorporation of Relocation Management
Systems, Inc.
3.16 By-Laws of Relocation Management Systems, Inc.
3.17 Articles of Incorporation of NACAL, Inc.
3.18 By-Laws of NACAL, Inc.
3.19 Amended Articles of Incorporation of Marlew, Inc., now known
as North American Van Lines of Texas, Inc.
3.20 By-Laws of Marlew, Inc., now known as North American Van
Lines of Texas, Inc.
3.21 Articles of Incorporation of Great Falls North American,
Inc.
3.22 By-Laws of Great Falls North American, Inc.
3.23 Amended Articles of Incorporation of Relocation Solutions
Management, Inc., now known as A Relocation Solutions
Management, Inc.
3.24 By-Laws of Relocation Solutions Management, Inc., now known
as A Relocation Solutions Management, Inc.
3.25 Amended Articles of Incorporation of Allied Sea Van Company,
now known as Allied Freight Forwarding, Inc.
3.26 Restated By-Laws of Allied Van Lines International
Corporation, now known as Allied Freight Forwarding, Inc.
3.27 Amended Certificate of Incorporation of Allied Pickfords
U.S.A., Inc., now known as Allied International N.A., Inc.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------------------- ------------------------------------------------------------
<C> <S>
3.28 Restated By-Laws of Allied International N.A., Inc.
3.29 Certificate of Agreement of Merger of NFC Merger Corporation
with and into Allied Van Lines, Inc.
3.30 By-Laws of Allied Van Lines, Inc.
3.31 Amended Articles of Incorporation of Allied Van Lines
Insurance Agency, Inc., now known as Vanguard Insurance
Agency, Inc.
3.32 By-Laws of Allied Van Lines Insurance Agency, Inc., now
known as Vanguard Insurance Agency, Inc.
3.33 Certificate of Incorporation of Allied Van Lines Terminal
Company
3.34 Restated By-Laws of Allied Van Lines Terminal Company
4.1 Indenture, dated as of November 19, 1999, among North
American Van Lines, State Street Bank and Trust Company and
the subsidiary guarantors party thereto
4.2 Registration Rights Agreement, dated November 19, 1999,
among North American Van Lines, Inc., Banc of America
Securities LLC, Chase Securities Inc. and the subsidiary
guarantors party thereto
4.3 Form of 13 3/8 Senior Subordinated Note due 2009 (included
in Exhibit 4.1)
5.1 Opinion of Debevoise & Plimpton*
10.1 Acquisition Agreement, dated as of September 14, 1999,
between NA Holding Corporation and NFC plc
10.2 Amendment No. 1 to the Acquisition Agreement, dated as of
November 19, 1999, between NA Holding Corporation and NFC
plc
10.3 Credit Agreement, dated as of November 19, 1999 and amended
as of November 23, 1999, among North American Van Lines, the
foreign subsidiary borrowers from time to time parties
thereto, the several banks and other financial institutions
from time to time parties thereto, The Bank of New York, as
documentation agent, Banc of America Securities LLC, as
syndication agent, and The Chase Manhattan Bank, as
collateral and administrative agent
10.4 Guaranty and Collateral Agreement, dated as of November 19,
1999, made by NA Holding Corporation, North American Van
Lines, Inc. and certain of its subsidiaries in favor of The
Chase Manhattan Bank, as collateral agent and administrative
agent
10.5 Common Stock Purchase Warrant No. 1, dated as of November
19, 1999, for 87,480 shares of NA Holding Common Stock,
issued in the name of NFC International Holdings
(Netherlands II) BV
10.6 Indemnification Agreement, dated as of March 30, 1998, among
NA Holding Corporation, NA Acquisition Corporation, North
American Van Lines, Clayton, Dubilier & Rice, Inc. and
Clayton, Dubilier & Rice Fund V Limited Partnership
10.7 Consulting Agreement, dated as of March 30, 1998, by and
among NA Holding Corporation, NA Acquisition Corporation,
and North American Van Lines, Inc. and Clayton, Dubilier &
Rice, Inc.
10.8 Registration and Participation Agreement, dated as of March
30, 1998, among NA Holding Corporation and Clayton,
Dubilier & Rice Fund V Limited Partnership
10.9 Amendment No. 1, dated as of November 19, 1999, to the
Registration and Participation Agreement, dated as of March
30, 1998, among NA Holding Corporation and Clayton,
Dubilier & Rice Fund V Limited Partnership
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------------------- ------------------------------------------------------------
<C> <S>
10.10 Letter Agreement, dated as of November 19, 1999, among NA
Holding Corporation, Clayton, Dubilier & Rice Fund V Limited
Partnership and NFC plc with respect to rights and
obligations of NFC by virtue of its acquisition of 174,961
shares of common stock, par value $0.01 per share, of NA
Holding Corporation
10.11 Stock Subscription Agreement, dated as of November 19, 1999,
between the NA Holding Corporation and Clayton, Dubilier &
Rice Fund V Limited Partnership
10.12 Stock Subscription Agreement, dated as of November 19, 1999,
between NA Holding Corporation and NFC plc
10.13 Form of Management Stock Subscription Agreement for Allied
Worldwide, Inc. (formerly NA Holding Corporation)
10.14 Form of Management Stock Option Agreement for Allied
Worldwide, Inc. (formerly NA Holding Corporation)
10.15 Transition Services Agreement, dated as of November 19,
1999, between NFC plc and NA Holding Corporation
10.16 Tax Matters Agreement, dated as of September 14, 1999,
between NA Holding Corporation and NFC plc
10.17 Amendment No. 1, dated as of April 1, 1998 to the Consulting
Agreement, dated as of March 30, 1998, by and among NA
Holding Corporation, NA Acquisition Corporation, North
American Van Lines, Inc., and Clayton, Dubilier & Rice, Inc.
12.1 Calculation of Ratios
15.1 Letter of PricewaterhouseCoopers LLP regarding unaudited
interim financial information
15.2 Letter of Ernst & Young regarding unaudited interim
financial information
21.1 List of Subsidiaries of North American Van Lines
23.1 Consent of Debevoise & Plimpton (contained in Exhibit 5.1)
23.2 Consent of PricewaterhouseCoopers LLP
23.3 Consent of KPMG
23.4 Consent of Ernst & Young
24.1 Powers of Attorney (contained on signature pages)
25.1 Statement of Eligibility of State Street Bank and Trust on
Form T-1
27.1 Financial Data Schedule
99.1 Form of Letter of Transmittal*
99.2 Form of Notice of Guaranteed Delivery*
99.3 Instruction to Registered Holder and/or Book Entry Transfer
Participant from Beneficial Owner for Tender of 13 3/8
Senior Subordinated Notes Due 2009 for registered 13 3/8
Senior Subordinated Notes Due 2009*
</TABLE>
- ------------------------
* To be filed by amendment.
<PAGE>
Exhibit 3.1
PAGE 1
State of Delaware
Office of the Secretary of State
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THE ATTACHED ARE TRUE AND CORRECT COPIES OF ALL DOCUMENTS ON FILE OF
"NORTH AMERICAN VAN LINES, INC." AS RECEIVED AND FILED IN THIS OFFICE.
THE FOLLOWING DOCUMENTS HAVE BEEN CERTIFIED:
CERTIFICATE OF INCORPORATION, FILED THE TWENTIETH DAY OF AUGUST, A.D.
1993, AT 4 O'CLOCK P.M.
CERTIFICATE OF AMENDMENT, FILED THE TWELFTH DAY OF NOVEMBER, A.D. 1993, AT
9 O'CLOCK A.M.
RESTATED CERTIFICATE, FILED THE TWELFTH DAY OF NOVEMBER, A.D. 1993, AT
9:05 O'CLOCK A.M.
CERTIFICATE OF DESIGNATION, FILED THE TWENTY-THIRD DAY OF DECEMBER, A.D.
1993, AT 1 O'CLOCK P.M.
CERTIFICATE OF AMENDMENT, CHANGING ITS NAME FROM "NAVL, INC." TO "NORTH
AMERICAN VAN LINES, INC.", FILED THE THIRTY-FIRST DAY OF DECEMBER, A.D. 1993, AT
8:31 O'CLOCK A.M.
RESTATED CERTIFICATE, FILED THE TWELFTH DAY OF SEPTEMBER, A.D. 1996, AT 10
O'CLOCK A.M.
CERTIFICATE OF OWNERSHIP, FILED THE THIRTIETH DAY OF MARCH, A.D. 1998, AT
12 O'CLOCK P.M.
[SEAL] /s/ Edward J. Freel
-----------------------------------
Edward J. Freel, Secretary of State
2348453 8100H AUTHENTICATION: 0056973
991461081 DATE: 11-01-99
<PAGE>
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 04:00 PM 08/20/1993
932325182 -- 2348453
CERTIFICATE OF INCORPORATION
OF
NAVL, INC.
FIRST: The name of the Corporation is NAVL, Inc. (hereinafter the
"Corporation").
SECOND: The address of the registered office of the Corporation in the
State of Delaware is 1209 Orange Street, in the City of Wilmington, County of
New Castle. The name of its registered agent at that address is The Corporation
Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful act or
activity for which a corporation may be organized under the General Corporation
Law of the State of Delaware as set forth in Title 8 of the Delaware Code (the
"GCL"), including without in any way limiting the generality of the foregoing,
to provide or arrange for the provision of transportation services by motor
carrier or otherwise.
FOURTH: The Corporation shall have authority to issue 20,000 shares of
capital stock, divided as follows among the classes set out below:
1. 10,000 shares of non-voting Preferred Stock, Series A (par value
$100.00) to have such preferences, limitations and relative rights, up to
the full extent permitted by law, as may be prescribed by appropriate
action of the Board of Directors of the Corporation in an amendment to
these Articles of Incorporation prior to the issuance of any such shares;
and
2. 10,000 shares of Common Stock (par value $1.00 per share) each of which
shall be entitled to one vote on all matters and to receive the net assets
of the Corporation upon liquidation.
FIFTH: No holder of any class of capital stock of the Corporation shall
have any preemptive right to subscribe to or purchase (i) any shares of capital
stock of the Corporation, (ii) any securities convertible into such shares, or
(iii) any options, warrants or rights to purchase such shares or securities
convertible into such shares.
SIXTH: The name and mailing address of the Sole Incorporator is as
follows:
Name Mailing Address
- ---- ---------------
Deborah M. Reusch P.O. Box 636
Wilmington, DE 19899
<PAGE>
SEVENTH: The following provisions are inserted for the management of the
business and the conduct of the affairs of the Corporation, and for further
definition, limitation and regulation of the powers of the Corporation and of
its directors and stockholders:
(1) The business and affairs of the Corporation shall be managed by
or under the direction of the Board of Directors.
(2) The directors shall have concurrent power with the stockholders
to make, alter, amend, change, add to or repeal the By-laws of the
Corporation.
(3) The number of directors of the Corporation shall be three,
except as otherwise from time to time fixed by, or in the manner provided
in, the By-laws of the Corporation. Election of directors need not be by
written ballot unless the By-laws so provide.
(4) No director shall be personally liable to the Corporation or any
of its stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability (i) for any breach of the director's duty
of loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) pursuant to Section 174 of the Delaware
General Corporation Law or (iv) for any transaction from which the
director derived an improper personal benefit. Any repeal or modification
of this Article SEVENTH by the stockholders of the Corporation shall not
adversely affect any right or protection of a director of the Corporation
existing at the time of such repeal or modification with respect to acts
or omissions occurring prior to such repeal or modification.
(5) In addition to the powers and authority hereinbefore or by
statute expressly conferred upon them, the directors are hereby empowered
to exercise all such powers and do all such acts and things as may be
exercised or done by the Corporation, subject, nevertheless, to the
provisions of the GCL, this Certificate of Incorporation, and any By-laws
adopted by the stockholders; provided, however, that no By-laws hereafter
adopted by the stockholders shall invalidate any prior act of the
directors which would have been valid if such By-laws had not been
adopted.
EIGHTH: Meetings of stockholders may be held within or without the State
of Delaware, as the By-laws may provide. The books of the Corporation may be
kept (subject to any provision contained in the GCL) outside the State of
Delaware at such place or places as may be designated from time to time by the
Board of Directors or in the By-laws of the Corporation.
NINTH: Whenever a compromise or arrangement is proposed between this
Corporation and its creditors or any class of them and/or between this
Corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this Corporation under
the provisions of Section 291 of the GCL or on the application of trustees in
dissolution or of any receiver or receivers appointed for this Corporation under
the provisions of Section 279 of the GCL, order a meeting of the creditors or
class of creditors, and/or of the stockholders or class of stockholders of this
Corporation, as the case
<PAGE>
3
may be, to be summoned in such manner as the said court directs. If a majority
in number representing three-fourths in value of the creditors or class of
creditors, and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of this Corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of this Corporation, as the case may be,
and also on this Corporation.
TENTH: The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Certificate of Incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
ELEVENTH: The names and mailing addresses of the individuals who are to
serve as directors of the Corporation until the first annual meeting of
stockholders or until their successors are elected and qualify are as follows:
Name Mailing Address
---- ---------------
Nancy S. Fleischman Three Commercial Place
Norfolk, VA 23510-2191
J. Gary Lane Three Commercial Place
Norfolk, VA 23510-2191
William A. Noell, Jr. Three Commercial Place
Norfolk, VA 23510-2191
I, THE UNDERSIGNED, being the Sole Incorporator hereinbefore named, for
the purpose of forming a corporation pursuant to the GCL, do make this
Certificate, hereby declaring and certifying that this is my act and deed and
the facts herein stated are true, and accordingly have hereunto set my hand this
20th day of August, 1993.
/s/ Deborah M. Reusch
---------------------
Deborah M. Reusch
Sole Incorporator
<PAGE>
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:00 AM 11/12/1993
933165246 -- 2348453
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
NAVL, INC.
----------
Pursuant to Section 241 of the
General Corporation Law of the State of Delaware
----------
NAVL, Inc., a Delaware corporation (hereinafter called the "Corporation"),
hereby does certify as follows:
FIRST: Article FOURTH of the Corporation's Certificate of Incorporation
hereby is amended to read in its entirety as set forth below:
FOURTH: The Corporation shall have authority to issue 20,000 shares of
capital stock, divided as follows among the classes set out below:
1. 10,000 shares of non-voting Preferred Stock, Series A (par
value $100.00), to have such preferences, limitations and
relative rights, up to the full extent permitted by law, as
may be prescribed in one or more resolutions providing for the
issue of such stock adopted by the Board of Directors.
2. 10,000 shares of Common Stock (par value $1.00 per share)
each of which shall be entitled to one vote on all matters and
to receive the net assets of the Corporation upon liquidation.
SECOND: The foregoing amendment duly was adopted by the Board of
directors, at a time when the Corporation has not received any payment for
any stock, in accordance with Section 241 of the General Corporation Law
of the State of Delaware.
IN WITNESS WHEREOF, NAVL, Inc. has caused this Certificate to be executed
in its corporate name this 10th day of November, 1993.
NAVL, Inc.
By /s/ William A. Noell, Jr.
----------------------------
William A. Noell, Jr.
Vice President
ATTEST
[SEAL]
/s/ Dezora M. Martin
- --------------------
Dezora M. Martin
Corporate Secretary
<PAGE>
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:05 AM 11/12/1993
933165247 -- 2348453
RESTATED
CERTIFICATE OF INCORPORATION
OF
NAVL, INC.
----------
Pursuant to Section 245 of the
General Corporation Law of the State of Delaware
----------
[Original Certificate of Incorporation was filed on August 20, 1993]
FIRST: The name of the Corporation is NAVL, Inc. (hereinafter the
"Corporation").
SECOND: The address of the registered office of the Corporation in the
State of Delaware is 1209 Orange Street, in the City of Wilmington, County of
New Castle. The name of its registered agent at that address is The Corporation
Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful act or
activity for which a corporation may be organized under the General Corporation
Law of the State of Delaware as set forth in Title 8 of the Delaware Code (the
"GCL"), including without in any way limiting the generality of the foregoing,
to provide or arrange for the provision of transportation services, by motor
carrier or otherwise.
FOURTH: The Corporation shall have authority to issue 20,000 shares of
capital stock, divided as follows among the classes set out below:
1. 10,000 shares of non-voting Preferred Stock, Series A (par value
$100.00), to have such preferences, limitations and relative rights, up to
the full extent permitted by law, as may be prescribed in one or more
resolutions providing for the issue of such stock adopted by the Board of
Directors.
2. 10,000 shares of Common Stock (par value $1.00 per share) each of which
shall be entitled to one vote on all matters and to receive the net assets
of the Corporation upon liquidation.
FIFTH: No holder of any class of capital stock of the Corporation shall
have any preemptive right to subscribe to or purchase (i) any shares of capital
stock of the Corporation, (ii) any securities convertible into such shares, or
(iii) any options, warrants or rights to purchase such shares or securities
convertible into such shares.
SIXTH: The following provisions are inserted for the management of the
business and the conduct of the affairs of the Corporation, and for further
definition, limitation and regulation of the powers of the Corporation and of
its directors and stockholders:
<PAGE>
2
(1) The business and affairs of the Corporation shall be managed by
or under the direction of the Board of Directors.
(2) The directors shall have concurrent power with the stockholders
to make, alter, amend, change, add to or repeal the By-laws of the
Corporation.
(3) The number of directors of the Corporation shall be three,
except as otherwise from time to time fixed by, or in the manner provided
in, the By-laws of the Corporation. Election of director's need not be by
written ballot unless the By-laws so provide.
(4) No director shall be personally liable to the Corporation or any
of its stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability (i) for any breach of the director's duty
of loyalty to the Corporation or Its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) pursuant to Section 174 of the Delaware
General Corporation Law or (iv) for any transaction from which the
director derived an improper personal benefit. Any repeal or modification
of this Article SEVENTH by the stockholders of the Corporation shall not
adversely affect any right or protection of a director of the Corporation
existing at the time of such repeal or modification with respect to acts
or omissions occurring prior to such repeal or modification.
(5) In addition to the powers and authority hereinbefore or by
statue expressly conferred upon them, the directors are hereby empowered
to exercise all such powers and do all such acts and things as may be
exercised or done by the Corporation, subject, nevertheless, to the
provisions of the GCL, this Certificate of Incorporation, and any By-laws
adopted by the stockholders; provided, however, that no By-laws hereafter
adopted by the stockholders shall invalidate any prior act of the
directors which would have been valid if such By-laws had not been
adopted.
SEVENTH: Meetings of stockholders may be held within or without the State
of Delaware, as the By-laws may provide. The books of the Corporation may be
kept (subject to any provision contained in the GCL) outside the State of
Delaware at such place or places as may be designated from time to time by the
Board of Directors or in the By-laws of the Corporation.
EIGHTH: Whenever a compromise or arrangement is proposed between this
Corporation and its creditors or any class of them and/or between this
Corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this Corporation under
the provisions of Section 291 of the GCL or on the application of trustees in
dissolution or of any receiver or receivers appointed for this Corporation under
the provisions of Section 279 of the GCL, order a meeting of the creditors or
class of creditors, and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, to be summoned in such manner as the said court
directs. If a majority in number
<PAGE>
3
representing three-fourths in value of the creditors or class of creditors,
and/or of the stockholders or class of stockholders of this Corporation, as the
case may be, agree to any compromise or arrangement and to any reorganization of
this Corporation as a consequence of such compromise or arrangement, the said
compromise or arrangement and the said reorganization shall, if sanctioned by
the court to which the said application has been made, be binding on all the
creditors or class of creditors, and/or on all the stockholders or class of
stockholders, of this Corporation, as the case may be, and also on this
Corporation.
NINTH: The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Certificate of Incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
TENTH: The names and mailing addresses of the individuals who are to serve
directors of the Corporation until the first annual meeting of stockholders or
until their successors are elected and qualify are as follows:
Name Mailing Address
---- ---------------
Nancy S. Fleischman Three Commercial Place
Norfolk, VA 23510-2191
J. Gary Lane Three Commercial Place
Norfolk, VA 23510-2191
William A. Noell, Jr. Three Commercial Place
Norfolk, VA 23510-2191
WE, THE UNDERSIGNED, being a Vice President and the Corporate Secretary of
NAVL, Inc., for the purpose of restating the Certificate of Incorporation
pursuant Section 245 of the GCL, hereby certify that (1) the foregoing Restated
Certificate of Incorporation duly was adopted in accordance with the provisions
of Section 245 of the GCL, with such exceptions as are permitted by the GCL,
and with such renumbering of Articles as results therefrom, (2) the foregoing
Restated Certificate of Incorporation only restates and integrates and does not
amend the provision of the Corporation's Certificate of Incorporation as
theretofore amended and supplemented and (3) there is no discrepancy between
those provisions and the provisions of this Restated Certificate of
Incorporation. We further hereby declare and certify that this is our act and
deed and the facts herein stated are true, and accordingly have hereunto set our
hands this 11th day of November, 1993.
By /s/ William A. Noell, Jr.
----------------------------
William A. Noell, Jr.
Vice President
ATTEST
[SEAL]
/s/ Dezora M. Martin
- --------------------
Dezora M. Martin
Corporate Secretary
<PAGE>
2. Restriction on Transfer. No purchaser from the Corporation or other
holder may transfer, assign, hypothecate or otherwise alienate or attempt to
alienate shares - or direct or indirect interest or interests therein - of
Preferred unless, as may be more particularly provided in the By-laws or by
resolution of the Board of Directors, both the following conditions are met:
(a) that such purchaser or holder first shall have offered in
writing to sell such shares to the Corporation for a consideration equal
to the par value of the shares, plus an amount equal to all dividends
whether or not declared, that are accrued and unpaid to the date such
shares are sold to the Corporation; and
(b) the Corporation shall not have accepted or rejected the offer
within fifteen business days from the date of its receipt by the
Corporation or shall have declined to purchase such shares.
Certificates evidencing interests in shares of Preferred shall be legended
to reflect or to provide notice of this restriction and may be legended to
provide notice of other restrictions imposed by applicable securities laws.
3. Redemption; Purchases. Redemption. At any time or from time to time,
after January 1,1999 (or, if earlier, on and after the effective date of [a] a
resolution of the Board of Directors authorizing the sale or other disposition
of more than ten percent (10%) by value of the assets of the Corporation, or [b]
an agreement between and among the Corporation and holders of all the
then-outstanding shares of the Preferred), the Corporation may redeem the whole
or any part of the Preferred then outstanding at a fixed redemption price per
share of par value, plus an amount equal to all dividends, whether or not
declared, that are accrued and unpaid to the date of redemption. Unless
otherwise provided in the subscription or other contract between the Corporation
and any purchaser for the sale and purchase of the Preferred, any notice
required by law of a proposed redemption of Preferred shall be given at least
thirty days, and not more than ninety days, prior to the date fixed for such
redemption to each holder of record of Preferred to be redeemed at the address
then appearing on the books of the Corporation. In case of the redemption of a
part only of the Preferred at the time outstanding, the Corporation shall select
by lot or pro rata, as the Board of Directors may determine, the shares to be
redeemed.
On or at any time before the redemption date, unless the holders of the
Preferred shall waive such requirement, the Corporation shall deposit in trust,
for the account of holders of the shares to be redeemed, funds necessary for
such redemption with a bank or trust company in good standing, organized under
the laws of the United States of America or of the State of New York, and having
capital, surplus and undivided profits aggregating at least $50,000,000,
designated in such notice of redemption. Upon making such deposit in trust,
whether or not the certificates therefor shall have been surrendered for
cancellation, all shares with respect to the redemption of which such deposit
shall have been made and such notice completed shall be deemed, from and after
the date fixed for redemption, no longer outstanding for any purpose, and all
rights with respect to such shares thereupon shall cease and terminate, except
only the right of the holders of the certificates for such shares to receive,
only out of the funds so deposited in trust, from and after the date of such
deposit, the amount payable upon the redemption thereof, without interest.
Purchases. Subject to the limitations, if any, contained in the
Certificate of Incorporation, the Corporation also may from time to time
purchase or otherwise acquire
<PAGE>
4. Liquidation. The fixed liquidation price for each share of Preferred,
both on voluntary and involuntary liquidation or dissolution, shall be its par
value, plus an amount equal to all dividends, whether or not declared, that are
accrued and unpaid to the date of payment of the liquidation price. No payment
shall be made in respect of common stock on voluntary or involuntary liquidation
or dissolution unless and until all amounts payable on the Preferred as
aforesaid shall have been paid. The merger, consolidation or other similar form
or type of association between or among the Corporation and one or more other
entities shall not be deemed a liquidation or dissolution of the Corporation for
these purposes.
5. Voting Rights. The holders of shares of Preferred shall not be entitled
to vote on any matter, provided, however, that without the favorable vote of the
holders of more than two thirds of the outstanding shares of the Preferred
voting as a separate class at a meeting called in accordance with the provisions
of the General Corporation Law of the State of Delaware and the By-laws of the
Corporation, the Corporation shall not take any of the following actions:
(i) increase the number of authorized shares of the Preferred or
alter, change or amend any of the provisions of (a) the Certificate of
Incorporation of the Corporation or of any certificate amendatory thereof
or supplementary thereto or (b) the By-laws of the Corporation, so as to
affect materially and adversely the preferences, limitations, voting
rights or relative or other rights of any nature of the holders of
Preferred; or
(ii) authorize, create or issue a new class, or change a class with
subordinate and inferior rights into a class, of shares having rights and
preferences prior or equal to the rights and preferences of the holders of
shares of the Preferred."
IN WITNESS WHEREOF, the undersigned William A. Noell, Jr. and Dezora M.
Martin have made this certificate under the seal of NAVL, Inc. and have signed
as Vice President and the Secretary, respectively, of the Corporation this 23rd
day of December 1993.
/s/ William A. Noell
--------------------
Vice President
[Corporate Seal]
Attest:
/s/ Dezora M. Martin
- --------------------
Secretary
<PAGE>
CERTIFICATE OF DESIGNATION EXHIBIT A
OF THE TO BOARD
PREFERRED STOCK, SERIES A (NON-VOTING) RESOLUTION
OF
NAVL, INC.
1. Dividends. Holders of Preferred Stock, Series A (par value, $100 per
share)(the Preferred), shall be entitled, commencing January 1, 1994, to receive
cumulative dividends at the annual rate of $7.00 per share, payable in arrears,
one quarter in each of March, June, September and December in each year, on such
specific date during such months as from time to time may be determined and
declared by the Board of Directors. If the required dividend payment for any
quarter shall not have been paid in full within five business days after the end
of such quarter, the annual rate of dividends on the Preferred shall be
increased to $9.00 per share for the period from the end of such quarter to the
date when payment of all dividends on the Preferred shall be fully current.
Dividends in arrears (computed on the basis of a 360-day year), shall not bear
interest. In addition so any other restriction imposed by law on the declaration
or payment of dividends on common stock, no dividend may be declared or paid on
common stock unless (1) simultaneously therewith there shall have been declared
and paid, or set apart for payment, all quarterly cash dividends, accrued and
unpaid on the Preferred, to and including the last day of the March, June,
September or December coincident with or next following the date of such
declaration or payment of such dividend on common stock, and (2) so long as any
Preferred is outstanding, the aggregate of all dividends declared or paid on
common stock shall as no time exceed the aggregate of all dividends declared and
paid, or set apart for payment, to holders of the Preferred.
2. Restriction on Transfer. No purchaser from the Corporation or other
holder may transfer, assign, hypothecate or otherwise alienate or attempt to
alienate shares - or direct or indirect interest or interests therein - of
Preferred unless, as may be more particularly provided in the By-laws or by
resolution of the Board of Directors, both the following conditions are met:
(a) that such purchaser or holder first shall have offered in
writing to sell such shares to the Corporation for a consideration equal
to the par value of the shares, plus an amount equal to all dividends,
whether or not declared, that are accrued and unpaid to the date such
share are sold so the Corporation; and
(b) the Corporation shall not have accepted or rejected the offer
within fifteen business days from the date of its receipt by the
Corporation or shall have declined to purchase such shares.
Certificates evidencing interests in shares of Preferred shall be legended
to reflect or to provide notice of this restriction and may be legended to
provide notice of other restrictions imposed by applicable securities laws.
<PAGE>
3. Redemption; Purchases. Redemption. At any time or from time to time,
after January 1,1999 (or, if earlier, on and after the effective date of [a] a
resolution of the Board of Directors authorizing the sale or other disposition
of more than ten percent (10%) by value of the assets of the Corporation, or [b]
an agreement between and among the Corporation and holders of all the
then-outstanding shares of the Preferred), the Corporation may redeem the whole
or any part of the Preferred then outstanding at a fixed redemption price per
share of par value, plus an amount equal to all dividends, whether or not
declared, that are accrued and unpaid to the date of redemption. Unless
otherwise provided in the subscription or other contract between the Corporation
and any purchaser for the sale and purchase of the Preferred, any notice
required by law of a proposed redemption of Preferred shall be given at least
thirty days, and not more than ninety days, prior to the date fixed for such
redemption to each holder of record of Preferred to be redeemed at the address
then appearing on the books of the Corporation. In case of the redemption of a
part only of the Preferred at the time outstanding, the Corporation shall select
by lot or pro rata, as the Board of Directors may determine, the shares to be
redeemed.
On or at any time before the redemption date, unless the holders of the
Preferred shall waive such requirement, the Corporation shall deposit in trust,
for the account of holders of the shares to be redeemed, funds necessary for
such redemption with a bank or trust company in good standing, organized under
the laws of the United States of America or of the State of New York, and having
capital, surplus and undivided profits aggregating at least $50,000,000,
designated in such notion of redemption. Upon making such deposit in trust,
whether or not the certificates therefor shall have been surrendered for
cancellation, all shares with respect to the redemption of which such deposit
shall have been made and such notice completed shall be deemed, from and after
the date fixed for redemption, no longer outstanding for any purpose, and all
rights with respect to such shares thereupon shall cease and terminate, except
only the right of the holders of the certificates for such shares to receive,
only out of the funds so deposited in trust, from and after the date of such
deposit, the amount payable upon the redemption thereof, without interest.
Purchases. Subject to the limitations, if any, contained in the
Certificate of Incorporation, the Corporation also may from time so time
purchase or otherwise acquire for a consideration shares of Preferred.
4. Liquidation. The fixed liquidation price for each share of Preferred,
both on voluntary and involuntary liquidation or dissolution, shall be its par
value, plus an amount equal to all dividends, whether or not declared, that are
accrued and unpaid to the date of payment of the liquidation price. No payment
shall be made in respect of common stock on voluntary or involuntary liquidation
or dissolution unless and until all amounts payable on the Preferred as
aforesaid shall have been paid. The merger, consolidation or other similar form
or type of association between or among the Corporation and one or more other
entities shall not be deemed a liquidation or dissolution of the Corporation for
these purposes.
5. Voting Rights. The holders of shares of Preferred shall not be entitled
to vote on any matter, provided, however, that without the favorable vote of the
holders of more than two thirds of the outstanding shares of the Preferred
voting as a separate class at a meeting called in accordance with the provisions
of the General Corporation Law of the State of Delaware and the By-laws of the
Corporation, the Corporation shall not take any of the following actions:
<PAGE>
(i) increase the number of authorized shares of the Preferred or
alter, change or amend any of the provisions of (a) the Certificate of
Incorporation of the Corporation or of any certificate amendatory thereof
or supplementary thereto or (b) the By-laws of the Corporation, so as to
affect materially and adversely the preferences, limitations, voting
rights or relative or other rights of any nature of the holders of
Preferred; or
(ii) authorize, create or issue a new class, or change a class with
subordinate and inferior rights into a class, of shares having rights and
preferences prior or equal to the rights and preferences of the holders of
shares of the Preferred.
END OF EXHIBIT A
<PAGE>
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 08:31 AM 12/31/1993
933655035 -- 2348453
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
NAVL, INC.
----------
Pursuant to Section 242 of the
General Corporation Law of the State of Delaware
----------
NAVL, Inc., a Delaware corporation (hereinafter called the "Corporation"),
hereby does certify as follows:
FIRST: Article FIRST of the Corporation's Certificate of Incorporation
hereby is amended to read in its entirety as set forth below:
FIRST: The name of the Corporation is North American Van Lines, Inc.
(hereinafter the "Corporation").
SECOND: The foregoing amendment duly was adopted by the Board of
Directors, and by the sole stockholder entitled to vote thereon, in the
manner permitted by and with the effects provided in, respectively,
Section 141(f) and Section 228 of the General Corporation Law of the State
of Delaware.
IN WITNESS WHEREOF, NAVL, Inc. has caused this Certificate to be executed
in its corporate name this 27th day of December, 1993.
NAVL, Inc.
By /s/ William A. Noell, Jr.
----------------------------
William A. Noell, Jr.
Vice President
ATTEST
[SEAL]
/s/ Dezora M. Martin
- --------------------
Dezora M. Martin
Corporate Secretary
<PAGE>
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 10:00 AM 09/12/1996
960265038 -- 2348453
RESTATED
CERTIFICATE OF INCORPORATION
OF
North American Van Lines, Inc.
----------
Pursuant to Sections 242 and 245 of the
General Corporation Law of the State of Delaware
----------
1. The name of the Corporation is North American Van Lines, Inc. (the
"Corporation").
2. The Corporation was incorporated in Delaware on August 20, 1993, under
the name "NAVL, Inc." and, effective December 31, 1993, caused its name to be
changed to "North American Van Lines, Inc."
3. The provisions of the Corporation's Articles of Incorporation hereby
ore amended and restated to read in their entirety as set forth below. Said
amendment duly (i) was adopted by the Board of Directors and (ii) recommended to
the stockholders by unanimous written consent, effective July 19, 1996, in the
manner provided by Section 141 of the General Corporation Law of the State of
Delaware (GCL) and such amendment duly was adopted (i) by the stockholders of
the Corporation and (ii) as required by the applicable Certificate of
Designation, by more than two thirds of the holders of the outstanding shares of
the Preferred Stock, Series A, voting as a separate class - both, by unanimous
written consent, effective August 23, 1996, in the manner provided by Section
228 of the GCL.
[Text of Restated Articles]
FIRST: The name of the Corporation is North American Van Lines, Inc.
(hereinafter the "Corporation").
SECOND: The address of the registered office of the Corporation in the
State of Delaware is 1209 Orange Street, in the City of Wilmington, County of
New Castle. The name of its registered agent at that address is The Corporation
Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful act or
activity for which a corporation may be organized under the General Corporation
Law of the State of Delaware as set forth in Title 8 of the Delaware Code (the
"GCL"), including without in any way limiting the generality of the foregoing,
to provide or arrange for the provision of transportation services by motor
carrier or otherwise.
FOURTH: The Corporation shall have authority to issue 20,000 shares of
capital stock, divided as follows among the classes set out below:
(1) 10,000 shares of non-voting Preferred Stock, Series A (par value,
$100.00 per share), to have the preferences, limitations and relative
rights set out below:
<PAGE>
2
A. Dividends. Holders of Preferred Stock, Series A (par value, $100
per share)(the Preferred), shall be entitled, commencing January 1,
1994, to receive cumulative dividends at the annual rate of $7.00
per share, payable in arrears, one quarter in each of March, June,
September and December in each year, on such specific date during
such months as from time to time may be determined and declared by
the Board of Directors. If the required dividend payment for any
quarter shall not have been paid in full within five business days
after the end of such quarter, the annual rate of dividends on the
Preferred shall be increased to $9.00 per share for be period from
the end of such quarter to the date when payment of all dividends on
the Preferred shall be fully current. Dividends in arrears (computed
on the basis of a 360-day year) shall not bear interest. In addition
to any other restriction imposed by law on the declaration or
payment of dividends on common stock, no dividend may be declared or
paid on common stock unless simultaneously therewith there shall
have been declared and paid, or set part for payment, all quarterly
cash dividends, accrued and unpaid on the Preferred, to and
including the last day of March, June, September or December
coincident with or next following the date of such declaration or
payment of such dividend on common stock.
B. Restrictions on Transfer. No purchaser from the Corporation or
other holder may transfer, assign, hypothecate or otherwise alienate
or attempt to alienate shares - or direct or indirect interest or
interests therein - of Preferred unless, as may be more particularly
provided in the By-laws or by resolution of the Board of Directors,
both the following conditions are met:
(i) that such purchaser or holder first shall have offered in
writing to sell such shares to the Corporation for a consideration
equal to the par value of the shares, plus an amount equal to all
dividends, whether or not declared, that are accrued and unpaid to
the date such shares are sold to the Corporation; and
(ii) the Corporation shall not have accepted or rejected the
offer within fifteen business days from the date of its receipt by
the Corporation or shall have declined to purchase such shares.
Certificates evidencing interests in shares of Preferred shall be
legended to reflect or to provide notice of this restriction and may
be legended to provide notice of other restrictions imposed by
applicable securities laws.
C. Redemption; Purchases. Redemption. At any time or from time to
time, after January 1, 1999 (or, if earlier, on and after the
effective date of [a] a resolution of the Board of Directors
authorizing the sale or other disposition of more than ten percent
(10%) by value of the assets of the Corporation, or [b] an agreement
between and among the Corporation and holders of all the then-
outstanding shares of the Preferred), the Corporation may redeem the
whole or any part of the Preferred then outstanding at a fixed
redemption price per share of par value, plus an amount equal to all
dividends, whether or not declared, that are
<PAGE>
3
accrued and unpaid to the date of redemption. Unless otherwise
provided in the subscription or other contract between the
Corporation and any purchaser for the sale and purchase of the
Preferred, any notice required by law of a proposed redemption of
Preferred shall be given at least thirty days, and not more than
ninety days, prior to the date fixed for such redemption to each
holder of record of Preferred to be redeemed at the address then
appearing on the books of the Corporation. In case of the redemption
of a part only of the Preferred at the time outstanding, the
Corporation shall select by lot or pro rata, as the Board of
Directors may determine, the shares to be redeemed.
On or at any time before the redemption date, unless the holders of
the Preferred shall waive such requirement, the Corporation shall
deposit in trust, for the account of holders of the shares to be
redeemed, funds necessary for such redemption with a bank or trust
company in good standing, organized under the laws of the United
States of America or of the State of New York, and having capital,
surplus and undivided profits aggregating at least $50,000,000,
designated in such notice of redemption. Upon making such deposit in
trust, whether or not the certificates therefor shall have been
surrendered for cancellation, all shares with respect to the
redemption of which such deposit shall have been made and such
notice completed shall be deemed, from and after the date fixed for
redemption, no longer outstanding for any purpose, and all rights
with respect to such shares thereupon shall cease and terminate,
except only the right of the holders of the certificates for such
shares to receive, only out of the funds so deposited in trust, from
and after the date of such deposit, the amount payable upon the
redemption thereof, without interest.
Purchases. Subject to the limitations, if any, contained in the
Certificate of Incorporation, the Corporation also may from time to
time purchase or otherwise acquire for a consideration shares of
Preferred.
D. Liquidation. The fixed liquidation price for each share of
Preferred, both on voluntary and involuntary liquidation or
dissolution, shall be its par value, plus an amount equal to all
dividends, whether or not declared, that are accrued and unpaid to
the date of payment of the liquidation price. No payment shall be
made in respect of common stock on voluntary or involuntary
liquidation or dissolution unless and until all amounts payable on
the Preferred as aforesaid shall have been paid. The merger,
consolidation or other similar form or type of association between
or among the Corporation and one or more other entities shall not be
deemed a liquidation or dissolution of the Corporation for these
purposes.
E. Voting Rights. The holders of shares of Preferred shall not be
entitled to vote on any matter, provided, however, that without the
favorable vote of the holders of more than two thirds of the
outstanding shares of the Preferred voting as a separate class at a
meeting called in accordance with the provisions of the General
Corporation Law of the State of Delaware and the By-laws of the
Corporation, the Corporation shall not take any of the following
actions:
(i) increase the number of authorized shares of the Preferred
or alter, change or amend any of the provisions of (a) the
Certificate of Incorporation of the
<PAGE>
4
Corporation or of any certificate amendatory thereof or
supplementary thereto or (b) the By-laws of the Corporation, so as
to affect materially and adversely the preferences, limitations,
voting rights or relative or other rights of any nature of the
holders of Preferred; or
(ii) authorize, create or issue a new class, or change a class
with subordinate and inferior rights into a class, of shares having
rights and preferences prior or equal to the rights and preferences
of the holders of shares of the Preferred.
(2) 10,000 shares of Common Stock (par value, $1.00 per share) each of
which shall be entitled to one vote on all matters and, subject to the
rights of the non-voting Preferred Stock, Series A, to receive the net
assets of the Corporation upon liquidation.
FIFTH: No holder of any class of capital stock of the Corporation shall
have any preemptive right to subscribe to or purchase (i) any shares of capital
stock of the Corporation, (ii) any securities convertible into such shares, or
(iii) any options, warrants or rights to purchase such shares or securities
convertible into such shares.
SIXTH: The following provisions are inserted for the management of the
business and the conduct of the affairs of the Corporation, and for further
definition, limitation and regulation of the powers of the Corporation and of
its directors and stockholders:
(1) The business and affairs of the Corporation shall be managed by or
under the direction of the Board of Directors.
(2) The directors shall have concurrent power with the stockholders to
make, alter, amend, change, add to or repeal the By-laws of the
Corporation.
(3) The number of directors of the Corporation shall be three, except as
otherwise from time to time fixed by, or in the manner provided in, the
By-laws of the Corporation. Election of directors need not be by written
ballot unless the By-laws so provide.
(4) No director shall be personally liable so the Corporation or any of
its stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability (i) for any breach of the director's duty
of loyalty so the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) pursuant to Section 174 of the Delaware
General Corporation Law or (iv) for any transaction from which the
director derived an improper personal benefit. Any repeal or modification
of this Article SIXTH by the stockholders of the Corporation shall not
adversely affect any right or protection of a director of the Corporation
existing at the time of such repeal or modification with respect to acts
or omissions occurring prior to such repeal or modification.
(5) In addition to the powers and authority hereinbefore or by statute
expressly conferred upon them, the directors are hereby empowered to
exercise all such powers and do all such acts and things as may be
exercised or done by the Corporation, subject, nevertheless, to the
provisions of the GCL, this Certificate of Incorporation, and any By-laws
adopted by the stockholders; provided, however, that no By-laws hereafter
adopted by the
<PAGE>
5
stockholders shall invalidate any prior act of the directors which would
have been valid if such By-laws had not been adopted.
SEVENTH: Meetings of stockholders may be held within or without the State
of Delaware, as the By-laws may provide. The books of the Corporation may be
kept (subject to any provision contained in the GCL) outside the State of
Delaware at such place or places as may be designated from time to time by the
Board of Directors or in the By-laws of the Corporation.
EIGHTH: Whenever a compromise or arrangement is proposed between this
Corporation and its creditors or any class of them and/or between this
Corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this Corporation under
the provisions of Section 291 of the GCL or on the application of trustees in
dissolution or of any receiver or receivers appointed for this Corporation under
the provisions of Section 279 of the GCL, order a meeting of the creditors or
class of creditors, and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, to be summoned in such manner as the said court
directs. If a majority in number representing three-fourths in value of the
creditors or class of creditors, and/or of the stockholders or class of
stockholders of this Corporation, as the case may be, agree so any compromise or
arrangement and to any reorganization of this Corporation as a consequence of
such compromise or arrangement, the said compromise or arrangement and the said
reorganization shall, if sanctioned by the court to which the said application
has been made, be binding on all the creditors or class of creditors, and/or on
all the stockholders or class of stockholders, of this Corporation, as the case
may be, and also on this Corporation.
NINTH: The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Certificate of Incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
[End of Text of Restated Articles]
IN WITNESS WHEREOF, the Corporation has caused this Restated Certificate
of Incorporation to be executed in its corporate name this 4th day of September
1996, by the undersigned authorized officer. NORTH AMERICAN VAN LINES, INC.
/s/ R. Alan Brogan
-------------------------------------
R. Alan Brogan
President and Chief Executive Officer
<PAGE>
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:00 PM 03/30/1998
981121177 -- 2348453
CERTIFICATE OF OWNERSHIP AND MERGER
Merging
NA ACQUISITION CORPORATION
Into
NORTH AMERICAN VAN LINES, INC
NA ACQUISITION CORPORATION (hereinafter referred to as the
"Corporation"), a corporation organized and existing under the laws of the State
of Delaware, HEREBY CERTIFIES
FIRST That the Corporation was incorporated on December 19, 1997
pursuant to the General Corporation Law of the State of Delaware (the "DGCL")
under the name NA Acquisition Corporation
SECOND That the Corporation is the owner of all of the issued and
outstanding shares of stock of North American Van Lines, Inc, a Delaware
corporation ("NAVL") incorporated pursuant to the DGCL on August 20, 1993 under
the name NAVL, Inc
THIRD That the following resolutions of the Corporation, dated as of
March 30, 1998, providing for the Corporation to be merged with and into NAVL,
with NAVL continuing as the surviving corporation (the "Surviving Corporation")
of the Merger (the "Merger"), were adopted by the Board of Directors of the
Corporation pursuant to a unanimous written consent adopted on the date hereof
Merger
RESOLVED, that the form, terms and provisions of the Certificate of
Ownership and Merger (the "Certificate of Merger"), in the form attached
to these resolutions as Exhibit A, merging the Corporation with and into
NAVL, with NAVL as the Surviving Corporation in the Merger, be, and they
hereby are, approved;
<PAGE>
RESOLVED FURTHER, that the directors of the Corporation shall be the
directors of NAVL as the Surviving Corporation in the Merger, and each of
the directors of NAVL immediately prior to the effective time of the
Merger (the "Effective Time") shall be removed from office at the
Effective Time, and Charles P. Pieper shall be Chairman of the Board of
Directors of NAVL as the Surviving Corporation in the Merger;
RESOLVED FURTHER, that the officers of NAVL prior to the Effective
Time (other than any such officer who is an employee of Norfolk Southern
Corporation who shall be removed from his respective office(s) at the
Effective Time) shall continue as officers of NAVL as the Surviving
Corporation in the Merger, except that R Barry Uber shall be President and
Chief Executive Officer and Kevin J. Conway shall be a Vice President of
NAVL as the Surviving Corporation in the Merger.
RESOLVED FURTHER, that the Certificate of Incorporation of the
Corporation, as amended, as set forth in Exhibit B attached to these
resolutions, shall be the Certificate of Incorporation of the Surviving
Corporation;
RESOLVED FURTHER, that the By-Laws of the Corporation shall become
the By-Laws of the Surviving Corporation;
RESOLVED FURTHER, that the name of the Surviving Corporation shall
be "North American Van Lines, Inc.".
RESOLVED FURTHER, that at the Effective Time each share of common
stock and each share of preferred stock of NAVL issued and outstanding
immediately prior to the Effective Time shall be canceled.
RESOLVED FURTHER, that at the Effective Time each share of common
stock of the Corporation issued and outstanding immediately prior to the
Effective Time shall be converted into one share of issued and outstanding
common stock of the Surviving Corporation, and
RESOLVED FURTHER, that the proper officers of the Corporation be,
and each of them hereby is, authorized and directed on behalf of the
Corporation to execute, acknowledge and file the Certificate of Merger
with the Secretary of State of the State of Delaware in accordance with
Section 253 of the DGCL.
2
<PAGE>
FOURTH That the Merger has been approved on the date hereof by the
written consent of the holder of all of the issued and outstanding shares of
common stock of the Corporation, in accordance with Section 228 of the DGCL.
FIFTH Notwithstanding anything to the contrary, the Merger may be
terminated and abandoned by the Board of Directors of the Corporation at any
time prior to the filing of this Certificate
3
<PAGE>
IN WITNESS WHEREOF, NA ACQUISITION CORPORATION has caused this
Certificate to be executed by its an officer thereunto duly authorized this 30th
day of March 1998
NA ACQUISITION CORPORATION
By /s/ Kevin J. Conway
----------------------
Name: Kevin J. Conway
Title: Vice President
4
<PAGE>
Exhibit A
CERTIFICATE OF OWNERSHIP AND MERGER
Merging
NA ACQUISITION CORPORATION
Into
NORTH AMERICAN VAN LINES, INC
NA ACQUISITION CORPORATION (hereinafter referred to as the
"Corporation"), a corporation organized and existing under the laws of the State
of Delaware, HEREBY CERTIFIES
FIRST That the Corporation was incorporated on December 19, 1997
pursuant to the General Corporation Law of the State of Delaware (the "DGCL")
under the name NA Acquisition Corporation
SECOND That the Corporation is the owner of all of the issued and
outstanding shares of stock of North American Van Lines, Inc. a Delaware
corporation ("NAVL") incorporated pursuant to the DGCL on August 20, 1993 under
the name NAVL, Inc.
THIRD That the following resolutions of the Corporation, dated as of
March 30, 1998, providing for the Corporation to be merged with and into NAVL,
with NAVL continuing as the surviving corporation (the "Surviving Corporation")
of the Merger (the "Merger"), were adopted by the Board of Directors of the
Corporation pursuant to a unanimous written consent adopted on the date hereof:
Merger
RESOLVED, that the form, terms and provisions of the Certificate of
Ownership and Merger (the "Certificate of Merger"), in the form attached
to these resolutions as Exhibit A, merging the Corporation with and into
NAVL, with NAVL as the Surviving Corporation in the Merger, be, and they
hereby are, approved.
<PAGE>
RESOLVED FURTHER, that the directors of the Corporation shall be the
directors of NAVL as the Surviving Corporation in the Merger, and each of
the directors of NAVL, immediately prior to the effective time of the
Merger (the "Effective Time") shall be removed from office at the
Effective Time, and Charles P. Pieper shall be Chairman of the Board of
Directors of NAVL as the Surviving Corporation in the Merger;
RESOLVED FURTHER, that the officers of NAVL prior to the Effective
Time (other than any such officer who is an employee of Norfolk Southern
Corporation who shall be removed from his respective office(s) at the
Effective Time) shall continue as officers of NAVL as the Surviving
Corporation in the Merger, except that R Barry Uber shall be President and
Chief Executive Officer and Kevin J. Conway shall be a Vice President of
NAVL as the Surviving Corporation in the Merger;
RESOLVED FURTHER, that the Certificate of Incorporation of the
Corporation, as amended, as set forth in Exhibit B attached to these
resolutions, shall be the Certificate of Incorporation of the Surviving
Corporation;
RESOLVED FURTHER, that the By-Laws of the Corporation shall become
the By-Laws of the Surviving Corporation;
RESOLVED FURTHER, that the name of the Surviving Corporation shall
be "North American Van Lines, Inc.";
RESOLVED FURTHER, that at the Effective Time each share of common
stock and each share of preferred stock of NAVL issued and outstanding
immediately prior to the Effective Time shall be canceled;
RESOLVED FURTHER, that at the Effective Time each share of common
stock of the Corporation issued and outstanding immediately prior to the
Effective Time shall be converted into one share of issued and outstanding
common stock of the Surviving Corporation; and
RESOLVED FURTHER, that the proper officers of the Corporation be,
and each of them hereby is, authorized and directed on behalf of the
Corporation to execute, acknowledge and file the Certificate of Merger
with the Secretary of State of the State of Delaware in accordance with
Section 253 of the DGCL
2
<PAGE>
FOURTH That the Merger has been approved on the date hereof by the
written consent of the holder of all of the issued and outstanding shares of
common stock of the Corporation, in accordance with Section 228 of the DGCL
FIFTH Notwithstanding anything to the contrary, the Merger may be
terminated and abandoned by the Board of Directors of the Corporation at any
time prior to the filing of this Certificate
3
<PAGE>
IN WITNESS WHEREOF, NA ACQUISITION CORPORATION has caused this
Certificate to be executed by its an officer thereunto duly authorized this 30th
day of March 1998
NA ACQUISITION CORPORATION
By: Kevin J. Conway
----------------------
Name: Kevin J. Conway
Title: Vice President
4
<PAGE>
Exhibit B
RESTATED
CERTIFICATE OF INCORPORATION
OF
NORTH AMERICAN VAN LINES, INC
FIRST: The name of the Corporation is North American Van Lines, Inc
SECOND: The Corporation's registered office in the State of Delaware
is at Corporation Trust Center, 1209 Orange Street in the City of Wilmington,
County of New Castle. The name of its registered agent at such address is The
Corporation Trust Company
THIRD: The nature of the business of the Corporation and as purpose
is to engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of the State of Delaware
FOURTH: The total number of shares of stock which the Corporation
shall have authority to issue is 1,000 shares of Common Stock, par value $.01
per share
FIFTH: The following provisions are inserted for the management of
the business and for the conduct of the affairs of the Corporation and for the
purpose of creating, defining, limiting and regulating the powers of the
Corporation and its directors and stockholders:
(a) The number of directors of the Corporation shall be fixed and
may be altered from time to time in the manner provided in the By-Laws,
and vacancies in the Board of Directors and newly created directorships
resulting from any increase in the authorized number of directors may be
filled, and directors may be removed, as provided in the By-Laws
(b) The election of directors may be conducted in any manner
approved by the stockholders at the time when the election is held and
need not be by ballot
(c) All corporate powers and authority of the Corporation (except as
at the time otherwise provided by law, by this Certificate of
Incorporation or by the By-Laws) shall be vested in and exercised by the
Board of Directors.
(d) The Board of Directors shall have the power without the assent
or vote of the stockholders to adopt, amend, alter or repeal the By-Laws
of the
<PAGE>
Corporation, except to the extent that the By-Laws or this Certificate of
Incorporation otherwise provide
(e) No director of the Corporation shall be liable to the
Corporation or its stockholders for monetary damages for breach of his or
her fiduciary duty as a director, provided that nothing contained in this
Certificate of Incorporation shall eliminate or limit the liability of a
director (i) for any breach of the director's duty of loyalty to the
Corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of
the law, (iii) under Section 174 of the General Corporation Law of the
State of Delaware or (iv) for any transaction from which the director
derived an improper personal benefit
SIXTH: The Corporation reserves the right to amend or repeal any
provision contained in this Certificate of Incorporation in the manner now or
hereafter prescribed by the laws of the State of Delaware, and all rights herein
conferred upon stockholders or directors are granted subject to this
reservation.
<PAGE>
Exhibit 3.2
================================================================================
NORTH AMERICAN VAN LINES INC.
BY-LAWS
As adopted on December 19, 1997,
as amended by consent resolution on March 31, 1998 and
as amended on July 14, 1998
================================================================================
<PAGE>
NORTH AMERICAN VAN LINES INC.
BY-LAWS
TABLE OF CONTENTS
SECTION PAGE
ARTICLE I STOCKHOLDERS..............................................1
Section 1.01. Annual Meetings.........................................1
Section 1.02. Special Meetings........................................1
Section 1.03. Notice of Meetings; Waiver..............................2
Section 1.04. Quorum..................................................3
Section 1.05. Voting..................................................3
Section 1.06. Voting by Ballot........................................3
Section 1.07. Adjournment.............................................4
Section 1.08. Proxies.................................................4
Section 1.09. Organization; Procedure.................................5
Section 1.10. Consent of Stockholders in Lieu of
Meeting.................................................5
ARTICLE II BOARD OF DIRECTORS........................................6
Section 2.01. General Powers..........................................6
Section 2.02. Number and Term of Office...............................7
Section 2.03. Election of Directors...................................7
Section 2.04. Annual and Regular Meetings.............................7
Section 2.05. Special Meetings; Notice................................8
Section 2.06. Quorum; Voting..........................................8
Section 2.07. Adjournment.............................................9
Section 2.08. Action Without a Meeting................................9
Section 2.09. Regulations; Manner of Acting...........................9
Section 2.10. Action by Telephonic Communications.....................9
Section 2.11. Resignations............................................9
Section 2.12. Removal of Directors...................................10
Section 2.13. Vacancies and Newly Created
Directorships.....................................10
<PAGE>
Section 2.14. Compensation...........................................10
Section 2.15. Reliance on Accounts and Reports, etc..................11
ARTICLE III EXECUTIVE COMMITTEE AND OTHER COMMITTEES..................11
Section 3.01. How Constituted........................................11
Section 3.02. Powers.................................................12
Section 3.03. Proceedings............................................14
Section 3.04. Quorum and Manner of Acting............................14
Section 3.05. Action by Telephonic Communications....................14
Section 3.06. Absent or Disqualified Members.........................15
Section 3.07. Resignations...........................................15
Section 3.08. Removal................................................15
Section 3.09. Vacancies..............................................15
ARTICLE IV OFFICERS..................................................15
Section 4.01. Number.................................................15
Section 4.02. Election...............................................16
Section 4.03. Salaries...............................................16
Section 4.04. Removal and Resignation; Vacancies.....................16
Section 4.05. Authority and Duties of Officers.......................17
Section 4.06. The President..........................................17
Section 4.07. The Vice Presidents....................................18
Section 4.08. The Secretary..........................................18
Section 4.09. The Treasurer..........................................19
Section 4.10. Additional Officers....................................21
Section 4.11. Security...............................................21
ARTICLE V CAPITAL STOCK.............................................21
Section 5.01. Certificates of Stock..................................21
Section 5.02. Signatures; Facsimile..................................22
Section 5.03. Lost, Stolen or Destroyed
Certificates...........................................22
Section 5.04. Transfer of Stock......................................23
Section 5.05. Record Date............................................23
Section 5.06. Registered Stockholders................................25
Section 5.07. Transfer Agent and Registrar...........................25
ARTICLE VI INDEMNIFICATION...........................................25
Section 6.01. Nature of Indemnity....................................25
ii
<PAGE>
Section 6.02. Successful Defense.....................................27
Section 6.03. Determination That Indemnification Is
Proper.................................................27
Section 6.04. Advance Payment of Expenses............................27
Section 6.05. Procedure for Indemnification of
Directors and Officers.................................28
Section 6.06. Survival; Preservation of Other
Rights.................................................29
Section 6.07. Insurance..............................................30
Section 6.08. Severability...........................................30
ARTICLE VII OFFICES...................................................31
Section 7.01. Registered Office......................................31
Section 7.02. Other Offices..........................................31
ARTICLE VIII GENERAL PROVISIONS........................................31
Section 8.01. Dividends..............................................31
Section 8.02. Reserves...............................................32
Section 8.03. Execution of Instruments...............................32
Section 8.04. Corporate Indebtedness.................................32
Section 8.05. Deposits...............................................33
Section 8.06. Checks.................................................33
Section 8.07. Sale, Transfer, etc. of Securities.....................33
Section 8.08. Voting as Stockholder..................................33
Section 8.09. Fiscal Year............................................34
Section 8.10. Seal...................................................34
Section 8.11. Books and Records; Inspection..........................34
ARTICLE IX AMENDMENT OF BY-LAWS......................................35
Section 9.01. Amendment..............................................35
ARTICLE X CONSTRUCTION..............................................35
Section 10.01. Construction..........................................35
iii
<PAGE>
NORTH AMERICAN VAN LINES, INC.
BY-LAWS
As adopted on December 19, 1997,
as amended by consent resolution on March 31, 1998 and as
amended on July 14, 1998
ARTICLE I
STOCKHOLDERS
Section 1.01. Annual Meetings. The annual meeting of the
stockholders of the Corporation for the election of directors and for the
transaction of such other business as properly may come before such meeting
shall be held at such place, either within or without the State of Delaware, and
at 10:00 a.m. local time on the first Tuesday in May (or, if such day is a legal
holiday, then on the next succeeding business day), or at such other date and
hour, as may be fixed from time to time by resolution of the Board of Directors
and set forth in the notice or waiver of notice of the meeting. [Sections
211(a), (b).](1)
Section 1.02. Special Meetings. Special meetings of the stockholders
may be called at any time by the President (or, in the event of his absence or
disability, by any Vice President), or by the Board of Directors. A special
meeting shall be called by the President (or, in the event of his absence or
disability, by any Vice President), or by the Secretary, immediately upon
receipt of a written request therefor by stockholders holding in the aggregate
- ----------
(1) Citations are to the General Corporation Law of the State of Delaware as
in effect on March 20, 1992 (the "GCL"), and are inserted for reference
only, and do not constitute a part of the By-Laws.
<PAGE>
not less than a majority of the outstanding shares of the Corporation at the
time entitled to vote at any meeting of the stockholders. If such officers or
the Board of Directors shall fail to call such meeting within 20 days after
receipt of such request, any stockholder executing such request may call such
meeting. Such special meetings of the stockholders shall be held at such places,
within or without the State of Delaware, as shall be specified in the respective
notices or waivers of notice thereof. [Section 211(d).]
Section 1.03. Notice of Meetings; Waiver. The Secretary or any
Assistant Secretary shall cause written notice of the place, date and hour of
each meeting of the stockholders, and, in the case of a special meeting, the
purpose or purposes for which such meeting is called, to be given personally or
by mail, not less than ten nor more than sixty days prior to the meeting, to
each stockholder of record entitled to vote at such meeting. If such notice is
mailed, it shall be deemed to have been given to a stockholder when deposited in
the United States mail, postage prepaid, directed to the stockholder at his
address as it appears on the record of stockholders of the Corporation, or, if
he shall have filed with the Secretary of the Corporation a written request that
notices to him be mailed to some other address, then directed to him at such
other address. Such further notice shall be given as may be required by law.
No notice of any meeting of stockholders need be given to any
stockholder who submits a signed waiver of notice, whether before or after the
meeting. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the stockholders need be specified in a written
waiver of notice. The attendance of any stockholder at a meeting of stockholders
shall constitute a waiver of notice of such meeting, except when the stockholder
attends a meeting for the express purpose of
2
<PAGE>
objecting, at the beginning of the meeting, to the transaction of any business
on the ground that the meeting is not lawfully called or convened. [Sections
222, 229.]
Section 1.04. Quorum. Except as otherwise required by law or by the
Certificate of Incorporation, the presence in person or by proxy of the holders
of record of a majority of the shares entitled to vote at a meeting of
stockholders shall constitute a quorum for the transaction of business at such
meeting. [Section 216.]
Section 1.05. Voting. If, pursuant to Section 5.05 of these By-Laws,
a record date has been fixed, every holder of record of shares entitled to vote
at a meeting of stockholders shall be entitled to one vote for each share
outstanding in his name on the books of the Corporation at the close of business
on such record date. If no record date has been fixed, then every holder of
record of shares entitled to vote at a meeting of stockholders shall be entitled
to one vote for each share of stock standing in his name on the books of the
Corporation at the close of business on the day next preceding the day on which
notice of the meeting is given, or, if notice is waived, at the close of
business on the day next preceding the day on which the meeting is held. Except
as otherwise required by law or by the Certificate of Incorporation, the vote of
a majority of the shares represented in person or by proxy at any meeting at
which a quorum is present shall be sufficient for the transaction of any
business at such meeting. [Sections 212(a), 216.]
Section 1.06. Voting by Ballot. No vote of the stockholders need be
taken by written ballot or conducted by Inspectors of Elections unless otherwise
required by law. Any vote which need not be taken by ballot may be conducted in
any manner approved by the meeting.
3
<PAGE>
Section 1.07. Adjournment. If a quorum is not present at any meeting
of the stockholders, the stockholders present in person or by proxy shall have
the power to adjourn any such meeting from time to time until a quorum is
present. Notice of any adjourned meeting of the stockholders of the Corporation
need not be given if the place, date and hour thereof are announced at the
meeting at which the adjournment is taken, provided, however, that if the
adjournment is for more than thirty days, or if after the adjournment a new
record date for the adjourned meeting is fixed pursuant to Section 5.05 of these
By-Laws, a notice of the adjourned meeting, conforming to the requirements of
Section 1.03 hereof, shall be given to each stockholder of record entitled to
vote at such meeting. At any adjourned meeting at which a quorum is present, any
business may be transacted that might have been transacted on the original date
of the meeting. [Section 222(c).]
Section 1.08. Proxies. Any stockholder entitled to vote at any
meeting of the stockholders or to express consent to or dissent from corporate
action without a meeting may authorize another person or persons to vote at any
such meeting and express such consent or dissent for him by proxy. A stockholder
may authorize a valid proxy by executing a written instrument signed by such
stockholder, or by causing his or her signature to be affixed to such writing by
any reasonable means including, but not limited to, by facsimile signature, or
by transmitting or authorizing the transmission of a telegram, cablegram or
other means of electronic transmission to the person designated as the holder of
the proxy, a proxy solicitation firm or a like authorized agent. No such proxy
shall be voted or acted upon after the expiration of three years from the date
of such proxy, unless such proxy provides for a longer period. Every proxy shall
be revocable at the pleasure of the stockholder executing it, except in those
cases where applicable law provides that a proxy shall be irrevocable. A
stockholder may revoke any proxy which is
4
<PAGE>
not irrevocable by attending the meeting and voting in person or by filing an
instrument in writing revoking the proxy or by filing another duly executed
proxy bearing a later date with the Secretary. Proxies by telegram, cablegram or
other electronic transmission must either set forth or be submitted with
information from which it can be determined that the telegram, cablegram or
other electronic transmission was authorized by the stockholder. Any copy,
facsimile telecommunication or other reliable reproduction of a writing or
transmission created pursuant to this section may be substituted or used in lieu
of the original writing or transmission for any and all purposes for which the
original writing or transmission could be used, provided that such copy,
facsimile telecommunication or other reproduction shall be a complete
reproduction of the entire original writing or transmission. [Sections 212(b),
(c).]
Section 1.09. Organization; Procedure. At every meeting of
stockholders the presiding officer shall be the President or, in the event of
his absence or disability, a presiding officer chosen by a majority of the
stockholders present in person or by proxy. The Secretary, or in the event of
his absence or disability, the Assistant Secretary, if any, or if there be no
Assistant Secretary, in the absence of the Secretary, an appointee of the
presiding officer, shall act as Secretary of the meeting. The order of business
and all other matters of procedure at every meeting of stockholders may be
determined by such presiding officer.
Section 1.10. Consent of Stockholders in Lieu of Meeting. To the
fullest extent permitted by law, whenever the vote of stockholders at a meeting
thereof is required or permitted to be taken for or in connection with any
corporate action, such action may be taken without a meeting, without prior
notice and without a vote of stockholders, if a consent or consents in writing,
setting forth the action so taken, shall be signed by the holders of
5
<PAGE>
outstanding stock having not less than the minimum number of votes that would be
necessary to authorize or take such action at a meeting at which all shares
entitled to vote thereon were present and voted and shall be delivered to the
Corporation by delivery to its registered office in the State of Delaware, its
principal place of business, or an officer or agent of the Corporation having
custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery made to the Corporation's registered office shall be by hand
or by certified or registered mail, return receipt requested.
Every written consent shall bear the date of signature of each
stockholder or member who signs the consent and no written consent shall be
effective to take the corporate action referred to therein unless, within sixty
days of the earliest dated consent delivered in the manner required by law to
the Corporation, written consents signed by a sufficient number of holders or
members to take action are delivered to the Corporation by delivery to its
registered office in the State of Delaware, its principal place of business, or
an officer or agent of the Corporation having custody of the book in which
proceedings of meetings of stockholders are recorded. Delivery made to the
Corporation's registered office shall be by hand or by certified or registered
mail, return receipt requested.
[Section 228.]
ARTICLE II
BOARD OF DIRECTORS
Section 2.01. General Powers. Except as may otherwise be provided by
law, by the Certificate of Incorporation or by these By-Laws, the property,
affairs and business of the Corporation shall be managed by or under the
direction of the Board of Directors and the Board of
6
<PAGE>
Directors may exercise all the powers of the Corporation. [Section 141(a).]
Section 2.02. Number and Term of Office. The number of Directors
constituting the entire Board of Directors shall be three (3), which number may
be modified from time to time by resolution of the Board of Directors, but in no
event shall the number of Directors be less than one. Each Director (whenever
elected) shall hold office until his successor has been duly elected and
qualified, or until his earlier death, resignation or removal. [Section 141(b).]
Section 2.03. Election of Directors. Except as otherwise provided in
Sections 2.12 and 2.13 of these By-Laws, the Directors shall be elected at each
annual meeting of the stockholders. If the annual meeting for the election of
Directors is not held on the date designated therefor, the Directors shall cause
the meeting to be held as soon thereafter as convenient. At each meeting of the
stockholders for the election of Directors, provided a quorum is present, the
Directors shall be elected by a plurality of the votes validly cast in such
election. [Sections 211(b), (c), 216.]
Section 2.04. Annual and Regular Meetings. The annual meeting of the
Board of Directors for the purpose of electing officers and for the transaction
of such other business as may come before the meeting shall be held as soon as
possible following adjournment of the annual meeting of the stockholders at the
place of such annual meeting of the stockholders. Notice of such annual meeting
of the Board of Directors need not be given. The Board of Directors from time to
time may by resolution provide for the holding of regular meetings and fix the
place (which may be within or without the State of Delaware) and the date and
hour of such meetings. Notice of regular meetings need not be given, provided,
however, that if the Board of Directors
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shall fix or change the time or place of any regular meeting, notice of such
action shall be mailed promptly, or sent by telegram, radio or cable, to each
Director who shall not have been present at the meeting at which such action was
taken, addressed to him at his usual place of business, or shall be delivered to
him personally. Notice of such action need not be given to any Director who
attends the first regular meeting after such action is taken without protesting
the lack of notice to him, prior to or at the commencement of such meeting, or
to any Director who submits a signed waiver of notice, whether before or after
such meeting. [Section 141(g).]
Section 2.05. Special Meetings; Notice. Special meetings of the
Board of Directors shall be held whenever called by the President or, in the
event of his absence or disability, by any Vice President, at such place (within
or without the State of Delaware), date and hour as may be specified in the
respective notices or waivers of notice of such meetings. Special meetings of
the Board of Directors may be called on 24 hours' notice, if notice is given to
each Director personally or by telephone or telegram, or on five days' notice,
if notice is mailed to each Director, addressed to him at his usual place of
business. Notice of any special meeting need not be given to any Director who
attends such meeting without protesting the lack of notice to him, prior to or
at the commencement of such meeting, or to any Director who submits a signed
waiver of notice, whether before or after such meeting, and any business may be
transacted thereat. [Sections 141(g), 229.]
Section 2.06. Quorum; Voting. At all meetings of the Board of
Directors, the presence of a majority of the total authorized number of
Directors shall constitute a quorum for the transaction of business. Except as
otherwise required by law, the vote of a majority of the Directors present at
any meeting at which a quorum is present shall be the act of the Board of
Directors. [Section 141(b).]
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Section 2.07. Adjournment. A majority of the Directors present,
whether or not a quorum is present, may adjourn any meeting of the Board of
Directors to another time or place. No notice need be given of any adjourned
meeting unless the time and place of the adjourned meeting are not announced at
the time of adjournment, in which case notice conforming to the requirements of
Section 2.05 shall be given to each Director.
Section 2.08. Action Without a Meeting. Any action required or
permitted to be taken at any meeting of the Board of Directors may be taken
without a meeting if all members of the Board of Directors consent thereto in
writing, and such writing or writings are filed with the minutes of proceedings
of the Board of Directors. [Section 141(f).]
Section 2.09. Regulations; Manner of Acting. To the extent
consistent with applicable law, the Certificate of Incorporation and these
By-Laws, the Board of Directors may adopt such rules and regulations for the
conduct of meetings of the Board of Directors and for the management of the
property, affairs and business of the Corporation as the Board of Directors may
deem appropriate. The Directors shall act only as a Board, and the individual
Directors shall have no power as such.
Section 2.10. Action by Telephonic Communications. Members of the
Board of Directors may participate in a meeting of the Board of Directors by
means of conference telephone or similar communications equipment by means of
which all persons participating in the meeting can hear each other, and
participation in a meeting pursuant to this provision shall constitute presence
in person at such meeting. [Section 141(i).]
Section 2.11. Resignations. Any Director may resign at any time by
delivering a written notice of
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resignation, signed by such Director, to the President or the Secretary. Unless
otherwise specified therein, such resignation shall take effect upon delivery.
[Section 141(b).]
Section 2.12. Removal of Directors. Any Director may be removed at
any time, either for or without cause, upon the affirmative vote of the holders
of a majority of the outstanding shares of stock of the Corporation entitled to
vote for the election of such Director, cast at a special meeting of
stockholders called for the purpose. Any vacancy in the Board of Directors
caused by any such removal may be filled at such meeting by the stockholders
entitled to vote for the election of the Director so removed. If such
stockholders do not fill such vacancy at such meeting (or in the written
instrument effecting such removal, if such removal was effected by consent
without a meeting), such vacancy may be filled in the manner provided in Section
2.13 of these By-Laws. [Section 141(b).]
Section 2.13. Vacancies and Newly Created Directorships. If any
vacancies shall occur in the Board of Directors, by reason of death,
resignation, removal or otherwise, or if the authorized number of Directors
shall be increased, the Directors then in office shall continue to act, and such
vacancies and newly created directorships may be filled by a majority of the
Directors then in office, although less than a quorum. A Director elected to
fill a vacancy or a newly created directorship shall hold office until his
successor has been elected and qualified or until his earlier death, resignation
or removal. Any such vacancy or newly created directorship may also be filled at
any time by vote of the stockholders. [Section 223.]
Section 2.14. Compensation. The amount, if any, which each Director
shall be entitled to receive as compensation for his services as such shall be
fixed from time to time by resolution of the Board of Directors;
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provided that (a) no director who is an officer or employee of Clayton, Dubilier
& Rice, Inc., a Delaware corporation ("CD&R"), at any time that CD&R is
providing consulting services to the Corporation or one or more of its
subsidiaries and (b) no director who is an officer or employee of the
Corporation shall be entitled to receive any compensation for his or her
services as a Director (although such Director shall be entitled to be
reimbursed for any reasonable out-of-pocket expenses incurred in connection with
his or her services as a Director). [Section 141(h).]
Section 2.15. Reliance on Accounts and Reports, etc. A Director, or
a member of any Committee designated by the Board of Directors shall, in the
performance of his duties, be fully protected in relying in good faith upon the
records of the Corporation and upon information, opinions, reports or statements
presented to the Corporation by any of the Corporation's officers or employees,
or Committees designated by the Board of Directors, or by any other person as to
the matters the member reasonably believes are within such other person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Corporation. [Section 141(e).]
ARTICLE III
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
Section 3.01. How Constituted. The Board of Directors may, by
resolution adopted by a majority of the whole Board, designate one or more
Committees, including an Executive Committee, each such Committee to consist of
such number of Directors as from time to time may be fixed by the Board of
Directors. The Board of Directors may designate one or more Directors as
alternate members of any such Committee, who may replace any absent or
disqualified member or members at any meeting of such Committee. Thereafter,
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members (and alternate members, if any) of each such Committee may be designated
at the annual meeting of the Board of Directors. Any such Committee may be
abolished or re-designated from time to time by the Board of Directors. Each
member (and each alternate member) of any such Committee (whether designated at
an annual meeting of the Board of Directors or to fill a vacancy or otherwise)
shall hold office until his successor shall have been designated or until he
shall cease to be a Director, or until his earlier death, resignation or
removal. [Section 141(c).]
Section 3.02. Powers. During the intervals between the meetings of
the Board of Directors, the Executive Committee, except as otherwise provided in
this section, shall have and may exercise all the powers and authority of the
Board of Directors in the management of the property, affairs and business of
the Corporation. Each such other Committee, except as otherwise provided in this
section, shall have and may exercise such powers of the Board of Directors as
may be provided by resolution or resolutions of the Board of Directors. Neither
the Executive Committee nor any such other Committee shall have the power or
authority:
(a) to amend the Certificate of Incorporation (except that a
Committee may, to the extent authorized in the resolution or resolutions
providing for the issuance of shares of stock adopted by the Board of
Directors as provided in Section 151(a) of the General Corporation Law,
fix the designations and any of the preferences or rights of such shares
relating to dividends, redemption, dissolution, any distribution of assets
of the Corporation or the conversion into, or the exchange of such shares
for, shares of any other class or classes or any other series of the same
or any other class or classes of stock of the Corporation or fix the
number of shares of any series of stock or
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authorize the increase or decrease of the shares of any series),
(b) to adopt an agreement of merger or consolidation or a
certificate of ownership or merger,
(c) to recommend to the stockholders the sale, lease or exchange of
all or substantially all of the Corporation's property and assets,
(d) to recommend to the stockholders a dissolution of the
Corporation or a revocation of a dissolution, or
(e) to declare a dividend;
(f) to authorize the issuance of stock;
(g) to remove the President of the Corporation or a Director;
(h) to authorize the borrowing of funds, other than under existing
facilities, that is material to the capital structure of the Corporation;
(i) to authorize any new compensation or benefit program;
(j) to appoint or discharge the Corporation's independent public
accountants;
(k) to authorize the annual operating plan, annual capital
expenditure plan and strategic plan;
(l) to abolish or usurp the authority of the Board of Directors; or
(m) to amend these By-Laws of the Corporation.
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The Executive Committee shall have, and any such other Committee may be granted
by the Board of Directors, power to authorize the seal of the Corporation to be
affixed to any or all papers which may require it. [Section 141(c).]
Section 3.03. Proceedings. Each such Committee may fix its own rules
of procedure and may meet at such place (within or without the State of
Delaware), at such time and upon such notice, if any, as it shall determine from
time to time. Each such Committee shall keep minutes of its proceedings and
shall report such proceedings to the Board of Directors at the meeting of the
Board of Directors next following any such proceedings.
Section 3.04. Quorum and Manner of Acting. Except as may be
otherwise provided in the resolution creating such Committee, at all meetings of
any Committee the presence of members (or alternate members) constituting a
majority of the total authorized membership of such Committee shall constitute a
quorum for the transaction of business. The act of the majority of the members
present at any meeting at which a quorum is present shall be the act of such
Committee. Any action required or permitted to be taken at any meeting of any
such Committee may be taken without a meeting, if all members of such Committee
shall consent to such action in writing and such writing or writings are filed
with the minutes of the proceedings of the Committee. The members of any such
Committee shall act only as a Committee, and the individual members of such
Committee shall have no power as such. [Section 141(c).]
Section 3.05. Action by Telephonic Communications. Members of any
Committee designated by the Board of Directors may participate in a meeting of
such Committee by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and participation in a meeting
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pursuant to this provision shall constitute presence in person at such meeting.
[Section 141(i).]
Section 3.06. Absent or Disqualified Members. In the absence or
disqualification of a member of any Committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he or
they constitute a quorum, may unanimously appoint another member of the Board of
Directors to act at the meeting in the place of any such absent or disqualified
member. [Section 141(c).]
Section 3.07. Resignations. Any member (and any alternate member) of
any Committee may resign at any time by delivering a written notice of
resignation, signed by such member, to the Chairman or the President. Unless
otherwise specified therein, such resignation shall take effect upon delivery.
Section 3.08. Removal. Any member (and any alternate member) of any
Committee may be removed at any time, either for or without cause, by resolution
adopted by a majority of the whole Board of Directors.
Section 3.09. Vacancies. If any vacancy shall occur in any
Committee, by reason of disqualification, death, resignation, removal or
otherwise, the remaining members (and any alternate members) shall continue to
act, and any such vacancy may be filled by the Board of Directors.
ARTICLE IV
OFFICERS
Section 4.01. Number. The officers of the Corporation shall be
chosen by the Board of Directors and
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shall be a President, one or more Vice Presidents, a Secretary and a Treasurer.
The Board of Directors also may elect one or more Assistant Secretaries and
Assistant Treasurers in such numbers as the Board of Directors may determine,
and appoint such other officers as the Board of Directors deems desirable. Any
number of offices may be held by the same person. No officer need be a Director
of the Corporation. [Section 142(a), (b).]
Section 4.02. Election. Unless otherwise determined by the Board of
Directors, the officers of the Corporation shall be elected by the Board of
Directors at the annual meeting of the Board of Directors, and shall be elected
to hold office until the next succeeding annual meeting of the Board of
Directors. In the event of the failure to elect officers at such annual meeting,
officers may be elected at any regular or special meeting of the Board of
Directors. Each officer shall hold office until his successor has been elected
and qualified, or until his earlier death, resignation or removal. In the event
of a vacancy in the office of Vice President, Secretary, Assistane Secretary,
Treasurer or Assistant Treasurer, the President may appoint a replacement to
service until the next meeting of the Board of Directors where a successor is
elected and qualified. [Section 142(b).]
Section 4.03. Salaries. The salaries of all officers and agents of
the Corporation shall be fixed by the Board of Directors.
Section 4.04. Removal and Resignation; Vacancies. Any officer may be
removed for or without cause at any time by the Board of Directors. Any officer
may resign at any time by delivering a written notice of resignation, signed by
such officer, to the Board of Directors or the President. Unless otherwise
specified therein, such resignation shall take effect upon delivery. Any vacancy
occurring in any office of the Corporation by death, resignation, removal or
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otherwise, shall be filled by the Board of Directors. [Section 142(b), (e).]
Section 4.05. Authority and Duties of Officers. The officers of the
Corporation shall have such authority and shall exercise such powers and perform
such duties as may be specified in these By-Laws, except that in any event each
officer shall exercise such powers and perform such duties as may be required by
law. [Section 142(a).]
Section 4.06. The President. The President shall preside at all
meetings of the stockholders and directors at which he is present, shall be the
chief executive officer and the chief operating officer of the Corporation,
shall have general control and supervision of the policies and operations of the
Corporation and shall see that all orders and resolutions of the Board of
Directors are carried into effect. He shall manage and administer the
Corporation's business and affairs and shall also perform all duties and
exercise all powers usually pertaining to the office of a chief executive
officer and a chief operating officer of a corporation. He shall have the
authority to sign, in the name and on behalf of the Corporation, checks, orders,
contracts, leases, notes, drafts and other documents and instruments in
connection with the business of the Corporation, and together with the Secretary
or an Assistant Secretary, conveyances of real estate and other documents and
instruments to which the seal of the Corporation is affixed. He shall have the
authority to cause the employment or appointment of such employees and agents of
the Corporation as the conduct of the business of the Corporation may require,
to fix their compensation, and to remove or suspend any employee or agent
elected or appointed by the President or the Board of Directors. The President
shall perform such other duties and have such other powers as the Board of
Directors or the Chairman may from time to time prescribe. Notwithstanding the
foregoing, the Board of Directors in its discretion may elect separate persons
to
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hold the offices of President, chief executive officer and/or chief operating
officer and perform such duties and exercise such powers as may be assigned to
such persons by the Board of Directors.
Section 4.07. The Vice Presidents. Each Vice President shall perform
such duties and exercise such powers as may be assigned to him from time to time
by the President. In the absence of the President, the duties of the President
shall be performed and his powers may be exercised by such Vice President as
shall be designated by the President, or failing such designation, such duties
shall be performed and such powers may be exercised by each Vice President in
the order of their earliest election to that office; subject in any case to
review and superseding action by the President.
Section 4.08. The Secretary. The Secretary shall have the following
powers and duties:
(a) He shall keep or cause to be kept a record of all the
proceedings of the meetings of the stockholders and of the Board of
Directors in books provided for that purpose.
(b) He shall cause all notices to be duly given in accordance with
the provisions of these By-Laws and as required by law.
(c) Whenever any Committee shall be appointed pursuant to a
resolution of the Board of Directors, he shall furnish a copy of such
resolution to the members of such Committee.
(d) He shall be the custodian of the records and of the seal of the
Corporation and cause such seal (or a facsimile thereof) to be affixed to
all certificates representing shares of the Corporation prior to the
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issuance thereof and to all instruments the execution of which on behalf
of the Corporation under its seal shall have been duly authorized in
accordance with these By-Laws, and when so affixed he may attest the same.
(e) He shall properly maintain and file all books, reports,
statements, certificates and all other documents and records required by
law, the Certificate of Incorporation or these By-Laws.
(f) He shall have charge of the stock books and ledgers of the
Corporation and shall cause the stock and transfer books to be kept in
such manner as to show at any time the number of shares of stock of the
Corporation of each class issued and outstanding, the names
(alphabetically arranged) and the addresses of the holders of record of
such shares, the number of shares held by each holder and the date as of
which each became such holder of record.
(g) He shall sign (unless the Treasurer, an Assistant Treasurer or
Assistant Secretary shall have signed) certificates representing shares of
the Corporation the issuance of which shall have been authorized by the
Board of Directors.
(h) He shall perform, in general, all duties incident to the office
of secretary and such other duties as may be specified in these By-Laws or
as may be assigned to him from time to time by the Board of Directors, or
the President.
Section 4.09. The Treasurer. The Treasurer shall be the chief
financial officer of the Corporation and shall have the following powers and
duties:
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(a) He shall have charge and supervision over and be responsible for
the moneys, securities, receipts and disbursements of the Corporation, and
shall keep or cause to be kept full and accurate records of all receipts
of the Corporation.
(b) He shall cause the moneys and other valuable effects of the
Corporation to be deposited in the name and to the credit of the
Corporation in such banks or trust companies or with such bankers or other
depositaries as shall be selected in accordance with Section 8.05 of these
By-Laws.
(c) He shall cause the moneys of the Corporation to be disbursed by
checks or drafts (signed as provided in Section 8.06 of these By-Laws)
upon the authorized depositaries of the Corporation and cause to be taken
and preserved proper vouchers for all moneys disbursed.
(d) He shall render to the Board of Directors or the President,
whenever requested, a statement of the financial condition of the
Corporation and of all his transactions as Treasurer, and render a full
financial report at the annual meeting of the stockholders, if called upon
to do so.
(e) He shall be empowered from time to time to require from all
officers or agents of the Corporation reports or statements giving such
information as he may desire with respect to any and all financial
transactions of the Corporation.
(f) He may sign (unless an Assistant Treasurer or the Secretary or
an Assistant Secretary shall have signed) certificates representing stock
of the Corporation the issuance of which shall have been authorized by the
Board of Directors.
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(g) He shall perform, in general, all duties incident to the office
of treasurer and such other duties as may be specified in these By-Laws or
as may be assigned to him from time to time by the Board of Directors, or
the President.
Section 4.10. Additional Officers. The Board of Directors may
appoint such other officers and agents as it may deem appropriate, and such
other officers and agents shall hold their offices for such terms and shall
exercise such powers and perform such duties as may be determined from time to
time by the Board of Directors. The Board of Directors from time to time may
delegate to any officer or agent the power to appoint subordinate officers or
agents and to prescribe their respective rights, terms of office, authorities
and duties. Any such officer or agent may remove any such subordinate officer or
agent appointed by him, for or without cause. [Section 142(a), (b).]
Section 4.11. Security. The Board of Directors may require any
officer, agent or employee of the Corporation to provide security for the
faithful performance of his duties, in such amount and of such character as may
be determined from time to time by the Board of Directors. [Section 142(c).]
ARTICLE V
CAPITAL STOCK
Section 5.01. Certificates of Stock. The shares of the Corporation
shall be represented by certificates, provided that the Board of Directors may
provide by resolution or resolutions that some or all of any or all classes or
series of the stock of the Corporation shall be uncertificated shares. Any such
resolution shall not apply to shares represented by a certificate until each
cer-
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tificate is surrendered to the Corporation. Notwithstanding the adoption of such
a resolution by the Board of Directors, every holder of stock in the Corporation
represented by certificates and upon request every holder of uncertificated
shares shall be entitled to have a certificate signed by, or in the name of the
Corporation, by the President or a Vice President, and by the Treasurer or an
Assistant Treasurer, or the Secretary or an Assistant Secretary, representing
the number of shares registered in certificate form. Such certificate shall be
in such form as the Board of Directors may determine, to the extent consistent
with applicable law, the Certificate of Incorporation and these By-Laws.
[Section 158.]
Section 5.02. Signatures; Facsimile. All of such signatures on the
certificate may be a facsimile, engraved or printed, to the extent permitted by
law. In case any officer, transfer agent or registrar who has signed, or whose
facsimile signature has been placed upon a certificate shall have ceased to be
such officer, transfer agent or registrar before such certificate is issued, it
may be issued by the Corporation with the same effect as if he were such
officer, transfer agent or registrar at the date of issue. [Section 158.]
Section 5.03. Lost, Stolen or Destroyed Certificates. The Board of
Directors may direct that a new certificate be issued in place of any
certificate theretofore issued by the Corporation alleged to have been lost,
stolen or destroyed, upon delivery to the Board of Directors of an affidavit of
the owner or owners of such certificate, setting forth such allegation. The
Board of Directors may require the owner of such lost, stolen or destroyed
certificate, or his legal representative, to give the Corporation a bond
sufficient to indemnify it against any claim that may be made against it on
account of the alleged loss, theft or destruction of any such certificate or the
issuance of any such new certificate. [Section 167.]
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Section 5.04. Transfer of Stock. Upon surrender to the Corporation
or the transfer agent of the Corporation of a certificate for shares, duly
endorsed or accompanied by appropriate evidence of succession, assignment or
authority to transfer, the Corporation shall issue a new certificate to the
person entitled thereto, cancel the old certificate and record the transaction
upon its books. Within a reasonable time after the transfer of uncertificated
stock, the Corporation shall send to the registered owner thereof a written
notice containing the information required to be set forth or stated on
certificates pursuant to Sections 151, 156, 202(a) or 218(a) of the General
Corporation Law of the State of Delaware. Subject to the provisions of the
Certificate of Incorporation and these By-Laws, the Board of Directors may
prescribe such additional rules and regulations as it may deem appropriate
relating to the issue, transfer and registration of shares of the Corporation.
[Section 151.]
Section 5.05. Record Date. In order to determine the stockholders
entitled to notice of or to vote at any meeting of stockholders or any
adjournment thereof, the Board of Directors may fix, in advance, a record date,
which record date shall not precede the date on which the resolution fixing the
record date is adopted by the Board of Directors, and which shall not be more
than sixty nor less than ten days before the date of such meeting. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting, provided,
however, that the Board of Directors may fix a new record date for the adjourned
meeting.
In order that the Corporation may determine the stockholders
entitled to consent to corporate action in writing without a meeting, the Board
of Directors may fix a record date, which record date shall not precede the date
upon which the resolution fixing the record date is adopted
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by the Board of Directors, and which date shall not be more than ten days after
the date upon which the resolution fixing the record date is adopted by the
Board of Directors. If no record date has been fixed by the Board of Directors,
the record date for determining stockholders entitled to consent to corporate
action in writing without a meeting, when no prior action by the board of
directors is required by law, shall be the first date on which a signed written
consent setting forth the action taken or proposed to be taken is delivered to
the Corporation by delivery to its registered office in the State of Delaware,
its principal place of business, or an officer or agent of the Corporation
having custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery made to the Corporation's registered office shall be by hand
or by certified or registered mail, return receipt requested. If no record date
has been fixed by the Board of Directors and prior action by the Board of
Directors is required by law, the record date for determining stockholders
entitled to consent to corporate action in writing without a meeting shall be at
the close of business on the day on which the Board of Directors adopts the
resolution taking such prior action.
In order that the Corporation may determine the stockholders
entitled to receive payment of any dividend or other distribution or allotment
of any rights of the stockholders entitled to exercise any rights in respect of
any change, conversion or exchange of stock, or for the purpose of any other
lawful action, the Board of Directors may fix a record date, which record date
shall not precede the date upon which the resolution fixing the record date is
adopted, and which record date shall be not more than sixty days prior to such
action. If no record date is fixed, the record date for determining stockholders
for any such purpose shall be at the close of business on the day on which the
Board of Directors adopts the resolution relating thereto. [Section 213.]
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Section 5.06. Registered Stockholders. Prior to due surrender of a
certificate for registration of transfer, the Corporation may treat the
registered owner as the person exclusively entitled to receive dividends and
other distributions, to vote, to receive notice and otherwise to exercise all
the rights and powers of the owner of the shares represented by such
certificate, and the Corporation shall not be bound to recognize any equitable
or legal claim to or interest in such shares on the part of any other person,
whether or not the Corporation shall have notice of such claim or interests.
Whenever any transfer of shares shall be made for collateral security, and not
absolutely, it shall be so expressed in the entry of the transfer if, when the
certificates are presented to the Corporation for transfer or uncertificated
shares are requested to be transferred, both the transferor and transferee
request the Corporation to do so. [Section 159.]
Section 5.07. Transfer Agent and Registrar. The Board of Directors
may appoint one or more transfer agents and one or more registrars, and may
require all certificates representing shares to bear the signature of any such
transfer agents or registrars.
ARTICLE VI
INDEMNIFICATION
Section 6.01. Nature of Indemnity. The Corporation shall indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he is or
was or has agreed to become a director or officer of the Corporation, or is or
was serving or has agreed to serve at the request of the Corporation as a
director or officer, of another corporation, partnership,
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joint venture, trust or other enterprise, or by reason of any action alleged to
have been taken or omitted in such capacity, and may indemnify any person who
was or is a party or is threatened to be made a party to such an action, suit or
proceeding by reason of the fact that he is or was or has agreed to become an
employee or agent of the Corporation, or is or was serving or has agreed to
serve at the request of the Corporation as an employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him or on his behalf in
connection with such action, suit or proceeding and any appeal therefrom, if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding had no reasonable cause to believe his conduct was
unlawful; except that in the case of an action or suit by or in the right of the
Corporation to procure a judgment in its favor (1) such indemnification shall be
limited to expenses (including attorneys' fees) actually and reasonably incurred
by such person in the defense or settlement of such action or suit, and (2) no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the Corporation
unless and only to the extent that the Delaware Court of Chancery or the court
in which such action or suit was brought shall determine upon application that,
despite the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the Delaware Court of Chancery or such other court shall deem
proper.
The termination of any action, suit or proceeding by judgment, order
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
26
<PAGE>
faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Corporation, and, with respect to any criminal action
or proceeding, had reasonable cause to believe that his conduct was unlawful.
Section 6.02. Successful Defense. To the extent that a director,
officer, employee or agent of the Corporation has been successful on the merits
or otherwise in defense of any action, suit or proceeding referred to in Section
6.01 hereof or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
Section 6.03. Determination That Indemnification Is Proper. Any
indemnification of a director or officer of the Corporation under Section 6.01
hereof (unless ordered by a court) shall be made by the Corporation unless a
determination is made that indemnification of the director or officer is not
proper in the circumstances because he has not met the applicable standard of
conduct set forth in Section 6.01 hereof. Any indemnification of an employee or
agent of the Corporation under Section 6.01 hereof (unless ordered by a court)
may be made by the Corporation upon a determination that indemnification of the
employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in Section 6.01 hereof. Any such
determination shall be made (1) by a majority vote the of the directors who are
not parties to such action, suit or proceeding even though less than a quorum,
or (2) by a committee of such directors designated by a majority vote of such
directors, even though less than a quorum, or (3) if there are no such
directors, or if such directors so direct, by independent legal counsel in a
written opinion, or (3) by the stockholders.
Section 6.04. Advance Payment of Expenses. Expenses (including
attorneys' fees) incurred by a director
27
<PAGE>
or officer in defending any civil, criminal, administrative or investigative
action, suit or proceeding shall be paid by the Corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of the director or officer to repay such amount if
it shall ultimately be determined that he is not entitled to be indemnified by
the Corporation as authorized in this Article. Such expenses (including
attorneys' fees) incurred by other employees and agents may be so paid upon such
terms and conditions, if any, as the Board of Directors deems appropriate. The
Board of Directors may authorize the Corporation's counsel to represent such
director, officer, employee or agent in any action, suit or proceeding, whether
or not the Corporation is a party to such action, suit or proceeding.
Section 6.05. Procedure for Indemnification of Directors and
Officers. Any indemnification of a director or officer of the Corporation under
Sections 6.01 and 6.02, or advance of costs, charges and expenses to a director
or officer under Section 6.04 of this Article, shall be made promptly, and in
any event within 30 days, upon the written request of the director or officer.
If a determination by the Corporation that the director or officer is entitled
to indemnification pursuant to this Article is required, and the Corporation
fails to respond within sixty days to a written request for indemnity, the
Corporation shall be deemed to have approved such request. If the Corporation
denies a written request for indemnity or advancement of expenses, in whole or
in part, or if payment in full pursuant to such request is not made within 30
days, the right to indemnification or advances as granted by this Article shall
be enforceable by the director or officer in any court of competent
jurisdiction. Such person's costs and expenses incurred in connection with
successfully establishing his right to indemnification, in whole or in part, in
any such action shall also be indemnified by the Corporation. It shall be a
defense to any such action
28
<PAGE>
(other than an action brought to enforce a claim for the advance of costs,
charges and expenses under Section 6.04 of this Article where the required
undertaking, if any, has been received by the Corporation) that the claimant has
not met the standard of conduct set forth in Section 6.01 of this Article, but
the burden of proving such defense shall be on the Corporation. Neither the
failure of the Corporation (including its Board of Directors, its independent
legal counsel, and its stockholders) to have made a determination prior to the
commencement of such action that indemnification of the claimant is proper in
the circumstances because he has met the applicable standard of conduct set
forth in Section 6.01 of this Article, nor the fact that there has been an
actual determination by the Corporation (including its Board of Directors, its
independent legal counsel, and its stockholders) that the claimant has not met
such applicable standard of conduct, shall be a defense to the action or create
a presumption that the claimant has not met the applicable standard of conduct.
Section 6.06. Survival; Preservation of Other Rights. The foregoing
indemnification provisions shall be deemed to be a contract between the
Corporation and each director, officer, employee and agent who serves in any
such capacity at any time while these provisions as well as the relevant
provisions of the Delaware Corporation Law are in effect and any repeal or
modification thereof shall not affect any right or obligation then existing with
respect to any state of facts then or previously existing or any action, suit or
proceeding previously or thereafter brought or threatened based in whole or in
part upon any such state of facts. Such a "contract right" may not be modified
retroactively without the consent of such director, officer, employee or agent.
The indemnification and advancement of expenses provided by this
Article VI shall not be deemed exclusive of
29
<PAGE>
any other rights to which those indemnified may be entitled under any by-law,
agreement, vote of stockholders or disinterested directors or otherwise, both as
to action in his official capacity and as to action in another capacity while
holding such office, and shall continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
Section 6.07. Insurance. The Corporation shall purchase and maintain
insurance on behalf of any person who is or was or has agreed to become a
director or officer of the Corporation, or is or was serving at the request of
the Corporation as a director or officer of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
him and incurred by him or on his behalf in any such capacity, or arising out of
his status as such, whether or not the Corporation would have the power to
indemnify him against such liability under the provisions of this Article,
provided that such insurance is available on acceptable terms, which
determination shall be made by a vote of a majority of the entire Board of
Directors.
Section 6.08. Severability. If this Article or any portion hereof
shall be invalidated on any ground by any court of competent jurisdiction, then
the Corporation shall nevertheless indemnify each director or officer and may
indemnify each employee or agent of the Corporation as to costs, charges and
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement with respect to any action, suit or proceeding, whether civil,
criminal, administrative or investigative, including an action by or in the
right of the Corporation, to the fullest extent permitted by any applicable
portion of this Article that shall not have been invalidated and to the fullest
extent permitted by applicable law.
30
<PAGE>
ARTICLE VII
OFFICES
Section 7.01. Registered Office. The registered office of the
Corporation in the State of Delaware shall be located at Corporation Trust
Center, 1209 Orange Street in the City of Wilmington, County of New Castle.
Section 7.02. Other Offices. The Corporation may maintain offices or
places of business at such other locations within or without the State of
Delaware as the Board of Directors may from time to time determine or as the
business of the Corporation may require.
ARTICLE VIII
GENERAL PROVISIONS
Section 8.01. Dividends. Subject to any applicable provisions of law
and the Certificate of Incorporation, dividends upon the shares of the
Corporation may be declared by the Board of Directors at any regular or special
meeting of the Board of Directors and any such dividend may be paid in cash,
property, or shares of the Corporation's Capital Stock.
A member of the Board of Directors, or a member of any Committee
designated by the Board of Directors shall be fully protected in relying in good
faith upon the records of the Corporation and upon such information, opinions,
reports or statements presented to the Corporation by any of its officers or
employees, or Committees of the Board of Directors, or by any other person as to
matters the Director reasonably believes are within such other person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Corporation, as
31
<PAGE>
to the value and amount of the assets, liabilities and/or net profits of the
Corporation, or any other facts pertinent to the existence and amount of surplus
or other funds from which dividends might properly be declared and paid.
[Sections 172, 173.]
Section 8.02. Reserves. There may be set aside out of any funds of
the Corporation available for dividends such sum or sums as the Board of
Directors from time to time, in its absolute discretion, thinks proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the Corporation or for such other
purpose as the Board of Directors shall think conducive to the interest of the
Corporation, and the Board of Directors may similarly modify or abolish any such
reserve. [Section 171.]
Section 8.03. Execution of Instruments. The President, any Vice
President, the Secretary or the Treasurer may enter into any contract or execute
and deliver any instrument in the name and on behalf of the Corporation. The
Board of Directors or the President may authorize any other officer or agent to
enter into any contract or execute and deliver any instrument in the name and on
behalf of the Corporation. Any such authorization may be general or limited to
specific contracts or instruments.
Section 8.04. Corporate Indebtedness. No loan shall be contracted on
behalf of the Corporation, and no evidence of indebtedness shall be issued in
its name, unless authorized by the Board of Directors or the President. Such
authorization may be general or confined to specific instances. Loans so
authorized may be effected at any time for the Corporation from any bank, trust
company or other institution, or from any firm, corporation or individual. All
bonds, debentures, notes and other obligations or evidences of indebtedness of
the Corporation issued for such loans shall be made, executed and delivered as
the Board of
32
<PAGE>
Directors or the President shall authorize. When so authorized by the Board of
Directors or the President, any part of or all the properties, including
contract rights, assets, business or good will of the Corporation, whether then
owned or thereafter acquired, may be mortgaged, pledged, hypothecated or
conveyed or assigned in trust as security for the payment of such bonds,
debentures, notes and other obligations or evidences of indebtedness of the
Corporation, and of the interest thereon, by instruments executed and delivered
in the name of the Corporation.
Section 8.05. Deposits. Any funds of the Corporation may be
deposited from time to time in such banks, trust companies or other depositaries
as may be determined by the Board of Directors or the President, or by such
officers or agents as may be authorized by the Board of Directors or the
President to make such determination.
Section 8.06. Checks. All checks or demands for money and notes of
the Corporation shall be signed by such officer or officers or such agent or
agents of the Corporation, and in such manner, as the Board of Directors or the
President from time to time may determine.
Section 8.07. Sale, Transfer, etc. of Securities. To the extent
authorized by the Board of Directors or by the President, any Vice President,
the Secretary or the Treasurer or any other officers designated by the Board of
Directors or the President may sell, transfer, endorse, and assign any shares of
stock, bonds or other securities owned by or held in the name of the
Corporation, and may make, execute and deliver in the name of the Corporation,
under its corporate seal, any instruments that may be appropriate to effect any
such sale, transfer, endorsement or assignment.
Section 8.08. Voting as Stockholder. Unless otherwise determined by
resolution of the Board of Direc-
33
<PAGE>
tors, the President or any Vice President shall have full power and authority on
behalf of the Corporation to attend any meeting of stockholders of any
corporation in which the Corporation may hold stock, and to act, vote (or
execute proxies to vote) and exercise in person or by proxy all other rights,
powers and privileges incident to the ownership of such stock. Such officers
acting on behalf of the Corporation shall have full power and authority to
execute any instrument expressing consent to or dissent from any action of any
such corporation without a meeting. The Board of Directors may by resolution
from time to time confer such power and authority upon any other person or
persons.
Section 8.09. Fiscal Year. The fiscal year of the Corporation shall
commence on the first day of January of each year (except for the Corporation's
first fiscal year which shall commence on the date of incorporation) and shall
terminate in each case on the last day of December.
Section 8.10. Seal. The seal of the Corporation shall be circular in
form and shall contain the name of the Corporation, the year of its
incorporation and the words "Corporate Seal" and "Delaware". The form of such
seal shall be subject to alteration by the Board of Directors. The seal may be
used by causing it or a facsimile thereof to be impressed, affixed or
reproduced, or may be used in any other lawful manner.
Section 8.11. Books and Records; Inspection. Except to the extent
otherwise required by law, the books and records of the Corporation shall be
kept at such place or places within or without the State of Delaware as may be
determined from time to time by the Board of Directors.
34
<PAGE>
ARTICLE IX
AMENDMENT OF BY-LAWS
Section 9.01. Amendment. These By-Laws may be amended, altered or
repealed
(a) by resolution adopted by a majority of the Board of Directors at
any special or regular meeting of the Board if, in the case of such
special meeting only, notice of such amendment, alteration or repeal is
contained in the notice or waiver of notice of such meeting; or
(b) at any regular or special meeting of the stockholders if, in the
case of such special meeting only, notice of such amendment, alteration or
repeal is contained in the notice or waiver of notice of such meeting.
[Section 109(a).]
ARTICLE X
CONSTRUCTION
Section 10.01. Construction. In the event of any conflict between
the provisions of these By-Laws as in effect from time to time and the
provisions of the certificate of incorporation of the Corporation as in effect
from time to time, the provisions of such certificate of incorporation shall be
controlling.
35
<PAGE>
Exhibit 3.3
State of Delaware
PAGE 1
Office of the Secretary of State
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF AMENDMENT
OF "NA HOLDING CORPORATION", CHANGING ITS NAME FROM "NA HOLDING CORPORATION" TO
"ALLIED WORLDWIDE, INC.", FILED IN THIS OFFICE ON THE SEVENTH DAY OF DECEMBER,
A.D. 1999, AT 11:30 O'CLOCK A.M.
A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE NEW CASTLE
COUNTY RECORDER OF DEEDS.
[SEAL]
/s/ Edward J. Freel
----------------------------------------
Edward J. Freel, Secretary of State
2836093 8100 AUTHENTICATION: 0121949
991521540 DATE: 12-07-99
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
NA HOLDING CORPORATION
Pursuant to Section 242 of the General
Corporation Law of the State of Delaware
NA Holding Corporation (the "Corporation"), a corporation organized
under the General Corporation Law of the State of Delaware (the "General
Corporation Law") hereby certifies as follows:
FIRST: That the Board of Directors of the Corporation, at a meeting
of its members on December 2, 1999, duly adopted a resolution setting forth the
following proposed amendment to the Certificate of Incorporation of the
Corporation and declaring such amendment to be advisable:
ARTICLE FIRST of the Certificate of Incorporation of the Corporation
is hereby amended to change the name of the Corporation to "Allied
Worldwide, Inc.".
SECOND: That in lieu of a meeting and vote of the stockholders of
the Corporation, the stockholders have by written consent, dated December
2, 1999, approved the adoption of the foregoing amendment in accordance
with the provision of Section 228 of the General Corporation Law, and that
such consent has been filed with the minutes of the proceedings of the
stockholders of the Corporation.
THIRD: That the foregoing amendment of the Certificate of
Incorporation was duly adopted pursuant to the applicable provisions of
Sections 141, 228 and 242 of the General Corporation Law.
<PAGE>
IN WITNESS WHEREOF, the undersigned, being the duly authorized
Secretary of the Corporation, for the purpose of amending the Certificate of
Incorporation of the Corporation pursuant to Section 242 of the General
Corporation Law of the State of Delaware, does make and file this Certificate,
hereby declaring and certifying that the facts herein stated are true, and
accordingly has hereunto set his hand, this 6th day of December, 1999.
/s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Secretary
<PAGE>
State of Delaware
PAGE 1
Office of the Secretary of State
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THAT "NA HOLDING CORPORATION" IS DULY INCORPORATED UNDER THE LAWS OF THE
STATE OF DELAWARE AND IS IN GOOD STANDING AND HAS A LEGAL CORPORATE EXISTENCE
NOT HAVING BEEN CANCELLED OR DISSOLVED SO FAR AS THE RECORDS OF THIS OFFICE SHOW
AND IS DULY AUTHORIZED TO TRANSACT BUSINESS.
THE FOLLOWING DOCUMENTS HAVE BEEN FILED:
CERTIFICATE OF INCORPORATION, FILED THE NINETEENTH DAY OF DECEMBER, A.D.
1997, AT 4 O'CLOCK P.M.
CERTIFICATE OF AMENDMENT, FILED THE SEVENTH DAY OF JANUARY, A.D. 1998, AT
8:30 O'CLOCK A.M.
CERTIFICATE OF AMENDMENT, FILED THE EIGHTEENTH DAY OF NOVEMBER, A.D. 1999,
AT 10 O'CLOCK A.M.
CERTIFICATE OF AMENDMENT, FILED THE EIGHTEENTH DAY OF NOVEMBER, A.D. 1999,
AT 12 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE NINETEENTH DAY OF NOVEMBER, A.D.
1999, AT 8:30 O'CLOCK A.M.
AND I DO HEREBY FURTHER CERTIFY THAT THE AFORESAID CERTIFICATES ARE THE
ONLY CERTIFICATES ON RECORD OF THE AFORESAID CORPORATION.
[SEAL]
/s/ Edward J. Freel
----------------------------------------
Edward J. Freel, Secretary of State
2836093 8310 AUTHENTICATION: 0093205
991495735 DATE: 11-19-99
<PAGE>
State of Delaware
PAGE 2
Office of the Secretary of State
AND I DO HEREBY FURTHER CERTIFY THAT THE ANNUAL REPORTS HAVE BEEN FILED TO
DATE.
AND I DO HEREBY FURTHER CERTIFY THAT THE FRANCHISE TAXES HAVE BEEN PAID TO
DATE.
[SEAL]
/s/ Edward J. Freel
----------------------------------------
Edward J. Freel, Secretary of State
2836093 8310 AUTHENTICATION: 0093205
991495735 DATE: 11-19-99
<PAGE>
State of Delaware
PAGE 1
Office of the Secretary of State
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THE ATTACHED ARE TRUE AND CORRECT COPIES OF ALL DOCUMENTS ON FILE OF "NA
HOLDING CORPORATION" AS RECEIVED AND FILED IN THIS OFFICE.
THE FOLLOWING DOCUMENTS HAVE BEEN CERTIFIED:
CERTIFICATE OF INCORPORATION, FILED THE NINETEENTH DAY OF DECEMBER, A.D.
1997, AT 4 O'CLOCK P.M.
CERTIFICATE OF AMENDMENT, FILED THE SEVENTH DAY OF JANUARY, A.D. 1998, AT
8:30 O'CLOCK A.M.
CERTIFICATE OF AMENDMENT, FILED THE EIGHTEENTH DAY OF NOVEMBER, A.D. 1999,
AT 10 O'CLOCK A.M.
CERTIFICATE OF DESIGNATION, FILED THE NINETEENTH DAY OF NOVEMBER, A.D.
1999, AT 8:30 O'CLOCK A.M.
[SEAL]
/s/ Edward J. Freel
----------------------------------------
Edward J. Freel, Secretary of State
2836093 8100H AUTHENTICATION: 0094411
991496794 DATE: 11-19-99
<PAGE>
CERTIFICATE OF INCORPORATION
OF
NA HOLDING CORPORATION
FIRST: The name of the Corporation is NA Holding Corporation.
SECOND: The Corporation's registered office in the State of Delaware
is at Corporation Trust Center, 1209 Orange Street in the City of Wilmington,
County of New Castle. The name of its registered agent at such address is The
Corporation Trust Company.
THIRD: The nature of the business of the Corporation and its purpose
is to engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of the State of Delaware.
FOURTH: The total number of shares of stock which the Corporation
shall have authority to issue is 1,000 shares of Common Stock, par value $.01
per share.
FIFTH: The name and mailing address of the incorporator is as
follows:
Francis Oh
c/o Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
SIXTH: The following provisions are inserted for the management of
the business and for the conduct of the affairs of the Corporation and for the
purpose of creating, defining, limiting and regulating the powers of the
Corporation and its directors and stockholders:
(a) The number of directors of the Corporation shall be fixed and
may be altered from time to time in the manner provided in the By-Laws,
and vacancies in the Board of Directors and newly created directorships
resulting from any increase in the authorized number of directors may be
filled, and directors may be removed, as provided in the By-Laws.
(b) The election of directors may be conducted in any manner
approved by the stockholders at the time when the election is held and
need not be by ballot.
(c) All corporate powers and authority of the Corporation (except as
at the time otherwise provided by law, by this Certificate of
Incorporation or by the By-Laws) shall be vested in and exercised by the
Board of Directors.
(d) The Board of Directors shall have the power without the assent
or vote of the stockholders to adopt, amend, alter or repeal the By-Laws
of the
<PAGE>
Corporation, except to the extent that the By-Laws or this Certificate of
Incorporation otherwise provide.
(e) No director of the Corporation shall be liable to the
Corporation or its stockholders for monetary damages for breach of his or
her fiduciary duty as a director, provided that nothing contained in this
Certificate of Incorporation shall eliminate or limit the liability of a
director (i) for any breach of the director's duty of loyalty to the
Corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of
the law, (iii) under Section 174 of the General Corporation Law of the
State of Delaware or (iv) for any transaction from which the director
derived an improper personal benefit.
SEVENTH: The Corporation reserves the right to amend or repeal any
provision contained in this Certificate of Incorporation in the manner now or
hereafter prescribed by the laws of the State of Delaware, and all rights herein
conferred upon stockholders or directors are granted subject to this
reservation.
IN WITNESS WHEREOF, I, the undersigned, being the incorporator
hereinabove named, for the purpose of forming a corporation pursuant to the
General Corporation Law of the State of Delaware, do make and file this
Certificate, hereby declaring and certifying that the facts herein stated are
true, and accordingly have hereunto set my hand this 19th day of December, 1997.
/s/ Francis Oh
----------------------------------------
Francis Oh
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED that on this 19th day of December, 1997, personally
appeared before me, ______________________________,a notary public for the State
of New York, FRANCIS OH, the party to the foregoing Certificate of
Incorporation, known to me personally to be such, and acknowledged the said
Certificate to be his act and deed and that the facts therein stated are true.
GIVEN under my hand and seal of office the day and year aforesaid.
[seal]
/s/ Stephen A. Oxman, Jr.
----------------------------------------
Notary Public
[SEAL]
STEPHEN A. OXMAN, JR.
Notary Public, State of New York
No. [ILLEGIBLE]
Qualified in New York County
Commission Expires [ILLEGIBLE]
2
<PAGE>
CERTIFICATE OF AMENDMENT
TO
THE CERTIFICATE OF INCORPORATION
OF
NA HOLDING CORPORATION
Pursuant to Section 241 of the General
Corporation Law of the State of Delaware
NA HOLDING CORPORATION, a corporation organized under the General
Corporation Law of the State of Delaware (the "Corporation") hereby certifies as
follows:
FIRST: That the Corporation has not received any payment for any of
its stock.
SECOND: That Article FOURTH of the Certificate of Incorporation of
the Corporation is hereby amended by deleting Article FOURTH in its entirety and
inserting in lieu thereof the following new Article FOURTH:
"FOURTH: The total number of shares of stock which the Corporation
shall have the authority to issue is 1,000,000 shares of Common Stock, par
value $0.01 per share."
<PAGE>
THIRD: That this Amendment to the Certificate of Incorporation was
duly adopted in accordance with Section 241 of the General Corporation Law of
the State of Delaware.
2
<PAGE>
IN WITNESS WHEREOF, this Certificate of Amendment to the Certificate
of Incorporation has been signed on behalf of NA HOLDING CORPORATION by Charles
P. Pieper, its Vice President, and attested by David A. Novak, its Secretary,
this 6th day of January, 1998.
/s/ Charles P. Pieper
----------------------------------------
Name: Charles P. Pieper
Title: Vice President
Attest:
/s/ David A. Novak
- -----------------------------------
Name: David A. Novak
Title: Secretary
<PAGE>
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
NA HOLDING CORPORATION
Pursuant to Section 242 of the General
Corporation Law of the State of Delaware
NA HOLDING CORPORATION, a corporation organized under the General
Corporation Law of the State of Delaware (the "Corporation") hereby certifies as
follows:
FIRST: That the Board of Directors of the Corporation, at a meeting
of its members, duly adopted a resolution setting forth the following proposed
amendment to the Certificate of Incorporation of the Corporation and declaring
such amendment to be advisable.
Article FOURTH of the Certificate of Incorporation of the
Corporation is hereby amended by deleting Article FOURTH in its entirety and
inserting in lieu thereof the following new Article FOURTH;
"FOURTH: The total number of shares of stock of all classes which
the Corporation has authority to issue is one million nine hundred
thousand (1,900,000). One million eight hundred thousand (1,800,000)
shares shall be
<PAGE>
Common Stock of the par value of one cent ($.01) per share, having an
aggregate par value of eighteen thousand dollars ($18,000) and one hundred
thousand (100,000) shares shall be Preferred Stock of the par value of one
cent ($.01) per share, having an aggregate par value of ten thousand
dollars ($10,000). The Preferred Stock may be issued, from time to time,
in one or more series as authorized by the Board of Directors or a duly
appointed committee thereof pursuant to an express delegation of authority
to such committee by the Board of Directors. Prior to issuance of a
series, the Board of Directors (or such committee) by resolution shall
designate that series to distinguish it from other series and classes of
stock of the Corporation, shall specify the number of shares to be
included in the series, and shall fix the terms, rights, restrictions and
qualifications of the shares of the series, including any preferences,
voting powers, dividend rights and redemption, sinking fund and conversion
rights. Subject to the express terms of any other series of Preferred
Stock outstanding at the time, the Board of Directors (or such committee)
may increase or decrease the number of shares or alter the designation or
classify or reclassify any unissued shares of a particular series of
Preferred Stock by fixing or altering in any one or more respects from
time to time before issuing the shares any terms, rights, restrictions and
qualifications of the shares."
THIRD: That in lieu of a meeting and vote of the stockholders of the
Corporation, the stockholders have, by written consent, dated November 9, 1999,
2
<PAGE>
approved the adoption of the foregoing amendment in accordance with the
provisions of Section 228 of the General Corporation Law, and that such consent
has been filed with the minutes of the proceedings of the stockholders of the
Corporation.
FOURTH: That this Amendment to the Certificate of Incorporation was
duly adopted in accordance with Section 242 of the General Corporation Law of
the State of Delaware.
3
<PAGE>
IN WITNESS WHEREOF, the undersigned, being a duly authorized Officer
of the Corporation, for the purpose of amending the Certificate of
Incorporation of the Corporation pursuant to Section 242 of the General
Corporation Law of the State of Delaware, does make and file this Certificate,
hereby declaring and certifying that the facts herein stated are true, and
accordingly has hereunto set his hand, this 18th day of November, 1999.
/s/ R. Barry Uber
----------------------------------------
Name: R. Barry Uber
Title: President and Chief
Executive Officer
4
<PAGE>
NA HOLDING CORPORATION
CERTIFICATE OF DESIGNATION OF THE POWERS, PREFERENCES AND
RELATIVE, PARTICIPATING, OPTIONAL AND OTHER SPECIAL RIGHTS OF
JUNIOR EXCHANGEABLE PREFERRED STOCK DUE 2010 AND
QUALIFICATIONS, LIMITATIONS AND RESTRICTIONS THEREOF
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
NA Holding Corporation, a corporation organized and existing under the
General Corporation Law of the State of Delaware (together with any successor
thereto, the "Company"), does hereby certify that, pursuant to authority
conferred upon the board of directors of the Company (the "Board of Directors")
by its Certificate of Incorporation, as amended (hereinafter referred to as the
"Certificate of Incorporation"), and pursuant to the provisions of Section 151
of the General Corporation Law of the State of Delaware, said Board of
Directors, by resolutions adopted at a meeting of the Board of Directors held on
November 8, 1999, duly approved and adopted the following resolution (the
"Resolution"):
RESOLVED, that, pursuant to the authority vested in the Board of
Directors by its Certificate of Incorporation, the Board of Directors does
hereby create, authorize and provide for the issue of a series of Junior
Exchangeable Preferred Stock, par value $0.01 per share, with an initial
liquidation preference of $1,000.00 per share, consisting of 24,500
shares, having the powers, preferences, and other special rights and the
qualifications, limitations and restrictions thereof that are set forth in
the Certificate of Incorporation and in this Certificate of Designation as
follows:
(a) Designation.
There is hereby created out of the authorized and unissued shares of
preferred stock of the Company a class of preferred stock designated as the
"Junior Exchangeable Preferred Stock" (the "Junior Preferred Stock"). The number
of shares constituting such class shall be 24,500. The initial liquidation
preference of each share of Junior Preferred Stock shall be $1,000.00 per share.
As of any time, the liquidation preference of any share of Junior Preferred
Stock shall be an amount equal to the excess of $1,000.00 over the Adjustment
Amount with respect to such share (such amount, the "Liquidation Preference").
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(b) Rank.
The Junior Preferred Stock shall, with respect to dividend distributions
and distributions upon the liquidation, winding-up and dissolution of the
Company, rank (i) senior to all classes of common stock of the Company (the
"Common Stock") and each other class of Capital Stock or series of Preferred
Stock of the Company hereafter created by the Board of Directors the terms of
which do not expressly provide that it ranks on a parity with or senior to the
Junior Preferred Stock as to dividend distributions and distributions upon the
liquidation, winding-up and dissolution of the Company (collectively referred to
with the Common Stock of the Company as "Junior Securities"), (ii) on a parity
with any class of Capital Stock or series of Preferred Stock hereafter created
by the Board of Directors, the terms of which expressly provide that such class
or series shall rank on a parity with the Junior Preferred Stock as to dividend
distributions and distributions upon the liquidation, winding-up and dissolution
of the Company (collectively referred to as "Parity Securities"), and (iii)
junior to any class of Capital Stock or series of Preferred Stock hereinafter
created by the Board of Directors, the terms of which expressly provide that
such class or series shall rank senior to the Junior Preferred Stock as to
dividend distributions and distributions upon the liquidation, winding up and
dissolution of the Company (collectively referred to as "Senior Securities").
(c) Dividends.
(i) On each Dividend Payment Date, the Holder of an outstanding share of
Junior Preferred Stock shall be entitled to receive, when, as and if declared by
the Board of Directors, out of funds legally available therefor, dividends on
such share of Junior Preferred Stock, at a quarterly rate of 3.10%, such
quarterly rate to be multiplied by the Stated Amount of such share as of such
time. All dividends shall be cumulative, whether or not earned or declared, on a
daily basis from the Issue Date and if declared shall be payable quarterly on
each Dividend Payment Date with respect to the quarter ending on such Dividend
Payment Date, commencing on the first Dividend Payment Date after the Issue
Date. Each distribution in the form of a dividend shall be payable to the
Holders of record as they appear on the stock register of the Company on such
record date, not less than 10 nor more than 60 days preceding the related
Dividend Payment Date, as shall be fixed by the Board of Directors. Dividends
shall cease to accumulate in respect of shares of the Junior Preferred Stock (x)
on the Exchange Date or on the date of their earlier redemption or purchase,
unless the Company shall have failed to issue the appropriate aggregate
principal amount of Exchange Debentures in respect of the Junior Preferred Stock
on the Exchange Date or shall have failed to pay the relevant redemption price
on the date fixed for redemption or the relevant Change of Control Purchase
Price on the date fixed for purchase, or (y) subject to the issuance of the
shares of Successor Company Stock as contemplated by paragraph (1)(i) hereof, on
any earlier Conversion Date.
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Dividends payable on shares of the Junior Preferred Stock for any period less
than three months shall be computed on the basis of a 90-day quarter of three
30-day months and the actual number of days elapsed in the period for which
payable. If any Dividend Payment Date occurs on a day that is not a Business
Day, any accrued dividends otherwise payable on such Dividend Payment Date shall
be paid on the next succeeding Business Day.
(ii) All dividends paid with respect to shares of the Junior Preferred
Stock pursuant to paragraph (c)(i) shall be paid to the Holders entitled
thereto, pro rata in accordance with the respective amounts thereof to which the
respective Holders are entitled.
(iii) Nothing herein contained shall in any way or under any circumstances
be construed or deemed to require the Board of Directors to declare, or the
Company to pay or set apart for payment, any dividends on shares of the Junior
Preferred Stock at any time.
(iv) Dividends on account of arrears for any past Dividend Period may be
declared and paid at any time, without reference to any regular Dividend Payment
Date, to the Holders of record on such date, not more than 45 days prior to the
payment thereof, as may be fixed by the Board of Directors.
(v) No full dividends shall be declared by the Board of Directors or paid
or funds set apart for payment of dividends by the Company on any Parity
Securities for any period (A) during which a Mandatory Redemption Event exists
and (B) unless full cumulative dividends shall have been or contemporaneously
are declared and paid in full, or declared and a sum in cash set apart
sufficient for such payment, on the Junior Preferred Stock for all Dividend
Periods terminating on or prior to the date of payment of such full dividends on
such Parity Securities. If any dividends are not paid in full, as aforesaid,
upon the shares of the Junior Preferred Stock and any other Parity Securities,
all dividends declared upon shares of the Junior Preferred Stock and any other
Parity Securities shall be declared pro rata so that the amount of dividends
declared per share on the Junior Preferred Stock and such Parity Securities
shall in all cases bear to each other the same ratio that accrued dividends per
share on the Junior Preferred Stock and such Parity Securities bear to each
other.
(vi) (A) The Holders of shares of the Junior Preferred Stock shall be
entitled to receive the dividends provided for in paragraph (c)(i) hereof in
preference to and in priority over any dividends upon any of the Junior
Securities, as and to the extent provided in paragraphs (c)(vi)(B) and (c)(vii)
below.
(B) So long as any shares of Junior Preferred Stock are outstanding, the
Company shall not declare, pay or set apart for payment any dividend on any of
the Junior
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Securities, or make any distribution in respect thereof for (1) any period
during which a Mandatory Redemption Event or Dividend Default exists and (2) any
period prior to a Public Offering unless full cumulative dividends shall have
been or contemporaneously are declared and paid in full, or declared and a sum
in cash set apart sufficient for such payment, on the Junior Preferred Stock for
all Dividend Periods terminating on or prior to the date of payment of such
dividends on such Junior Securities.
(vii) At any time that a Dividend Default or Mandatory Redemption Event
exists, so long as any shares of Junior Preferred Stock are outstanding, the
Company shall not make any payment on account of, or set apart for payment money
for a sinking or other similar fund for, the purchase, redemption or other
retirement of, any of the Junior Securities or any warrants, rights, calls or
options exercisable for or convertible into any of the Junior Securities, either
directly or indirectly, and whether in cash, obligations or shares of the
Company or other property, and shall not permit any corporation or other entity
directly or indirectly controlled by the Company to purchase or redeem any of
the Junior Securities or any such warrants, rights, calls or options.
(viii) At any time that a Dividend Default or Mandatory Redemption Event
exists, so long as any shares of Junior Preferred Stock are outstanding, the
Company shall not make any payment on account of, or set apart for payment money
for a sinking or other similar fund for, the purchase, redemption or other
retirement of, any of the Parity Securities or any warrants, rights, calls or
options exercisable for or convertible into any of the Parity Securities, and
shall not permit any corporation or other entity directly or indirectly
controlled by the Company to purchase or redeem any of the Parity Securities or
any such warrants, rights, calls or options.
(d) Liquidation Preference.
(i) Upon any voluntary or involuntary liquidation, dissolution or
winding-up of the affairs of the Company (determined either for the Company
alone or with its Subsidiaries on a consolidated basis), each Holder of any
share of the Junior Preferred Stock then outstanding shall be entitled to be
paid, out of the assets of the Company available for distribution to its
stockholders, the Liquidation Preference for such share of the Junior Preferred
Stock as of such time, plus, without duplication, an amount in cash equal to all
accumulated and unpaid dividends thereon to the date fixed for liquidation,
dissolution or winding-up (including an amount equal to a prorated dividend for
the period from the last Dividend Payment Date to the date fixed for
liquidation, dissolution or winding-up), before any payment shall be made or any
assets distributed to the holders of any of the Junior Securities, including,
without limitation, Common Stock of the Company. If upon any voluntary or
involuntary liquidation, dissolution or winding-up of the Company, the assets of
the Company are not sufficient to pay in full the Liquidation Preference for the
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Junior Preferred Stock and liquidation preference for all Parity Securities as
of such time and the accumulated and unpaid dividends payable to the holders of
outstanding shares of the Junior Preferred Stock and all Parity Securities, then
the holders of all such shares shall share equally and ratably in such
distribution of assets of the Company in proportion to the Liquidation
Preference for the Junior Preferred Stock and liquidation preference for all
Parity Securities as of such time plus accumulated and unpaid dividends which
would be payable on such distribution if the respective amounts thereof to which
the Holders of outstanding shares of Junior Preferred Stock and the holders of
outstanding shares of all Parity Securities are entitled were paid in full.
(ii) After payment of the full amount of the Liquidation Preference and
all accumulated and unpaid dividends to which they are entitled, the Holders of
shares of the Junior Preferred Stock shall not be entitled to any further
participation in any distribution of assets of the Company with respect to the
shares of Junior Preferred Stock.
(iii) For the purposes of this paragraph (d), neither the sale,
conveyance, exchange or transfer (for cash, shares of stock, securities or other
consideration) of all or substantially all of the property or assets of the
Company nor the consolidation or merger of the Company with or into one or more
Persons shall be deemed to be a liquidation, dissolution or winding-up of the
affairs of the Company (unless such sale, conveyance, exchange or transfer is in
connection with a dissolution or winding-up of the business of the Company,
whereby the transferee of such property or assets or the surviving Person in
such consolidation or merger does not continue to operate such business as a
going concern).
(e) Redemption.
(i) Optional Redemption. (A) The Company may (subject to the legal
availability of funds therefor), at the option of the Company, redeem at any
time on or after the first anniversary of the Issue Date, from any source of
funds legally available therefor, in whole or in part, in the manner provided in
paragraph (e)(iii) hereof, any or all of the shares of the Junior Preferred
Stock, at a redemption price for any such share equal to the sum of (i) the
product of (A) the Liquidation Preference of such share as of the applicable
Redemption Date, multiplied by (B) the percentage set forth below with respect
to such Redemption Date, plus (ii) without duplication, an amount in cash equal
to all accumulated and unpaid dividends with respect to such share (including an
amount in cash equal to a prorated dividend for the period from the Dividend
Payment Date immediately prior to the Redemption Date to the Redemption Date)
(collectively, the "Optional Redemption Price"):
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PERIOD PERCENTAGE
------ ----------
12-month period commencing on
the first anniversary of the
Issue Date ............................................ 103%
12-month period commencing on
the second anniversary of the
Issue Date ............................................ 102%
12-month period commencing on
the third anniversary of the
Issue Date ............................................ 101%
Thereafter ............................................ 100%
(B) In addition, in the event a Change of Control of the Company is
consummated at any time prior to the first anniversary of the Issue Date, the
Company may redeem (subject to contractual and other restrictions with respect
thereto and the legal availability of funds therefor), in the manner provided in
paragraph (e)(iii) hereof, all of but not less than all of the outstanding
shares of the Junior Preferred Stock at a redemption price for each share
equal to 103% of the Liquidation Preference of such share as of the
applicable Redemption Date thereof, plus, without duplication, an amount in
cash equal to all accumulated and unpaid dividends with respect to such share
(including an amount in cash equal to a prorated dividend for the period from
the Dividend Payment Date immediately prior to the Redemption Date to the
Redemption Date) (collectively, the "Special Redemption Price").
(C) In the event of a redemption of only a portion of the then outstanding
shares of the Junior Preferred Stock, the Company shall effect such redemption
as it determines, pro rata, according to the number of shares held by each
Holder of the Junior Preferred Stock or by lot, as may be determined by the
Company in its sole discretion.
(ii) Mandatory Redemption. On the date which is 11 years after the Issue
Date, upon the existence and continuance for at least 180 days of any Mandatory
Redemption Event (other than a Mandatory Redemption Event pursuant to clause (1)
of the definition thereof) or upon the existence and continuance of a Dividend
Default for four consecutive quarterly periods, the Company shall redeem
(subject to the Debt Agreements (including the availability of funds by dividend
from NAVL in compliance therewith), and to the legal availability of funds
therefor) in the manner provided in paragraph (e)(iii) hereof, each share of the
Junior Preferred Stock then outstanding at a redemption price equal to the
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Liquidation Preference of such share as of the applicable Redemption Date, plus,
without duplication, an amount in cash equal to all accumulated and unpaid
dividends with respect to such share (including an amount equal to a prorated
dividend for the period from the Dividend Payment Date immediately prior to the
Redemption Date to the Redemption Date) (collectively, the "Mandatory Redemption
Price").
(iii) Procedures for Optional Redemption and Mandatory Redemption. (A) At
least 30 days and not more than 60 days prior to the date fixed for any
redemption of the Junior Preferred Stock, written notice (the "Redemption
Notice") shall be given by first-class mail, postage prepaid, to each Holder of
record on the record date fixed for such redemption of the Junior Preferred
Stock at such Holder's address as the same appears on the stock register of the
Company, provided that no failure to give such notice nor any deficiency therein
shall affect the validity of the procedure for the redemption of any shares of
Junior Preferred Stock to be redeemed except as to the Holder or Holders to whom
the Company has failed to give said notice or except as to the Holder or Holders
whose notice was defective. The Redemption Notice shall state:
(1) whether the redemption is pursuant to paragraph (e)(i)(A),
(e)(i)(B), or (e)(ii) hereof;
(2) the Optional Redemption Price, the Special Redemption Price or the
Mandatory Redemption Price, as the case may be;
(3) whether all or less than all the outstanding shares of the Junior
Preferred Stock are to be redeemed and the total number of shares of
the Junior Preferred Stock being redeemed;
(4) the number of shares of Junior Preferred Stock held, as of the
appropriate record date, by the Holder that the Company intends to
redeem;
(5) the date fixed for redemption;
(6) that the Holder is to surrender to the Company, at the place or
places where certificates for shares of Junior Preferred Stock are
to be surrendered for redemption, in the manner and at the price
designated, the certificate or certificates representing the shares
of Junior Preferred Stock to be redeemed; and
(7) that dividends on the shares of the Junior Preferred Stock to be
redeemed shall cease to accrue on the Redemption Date unless the
Company defaults
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four fiscal quarters (in each case, determined, for each fiscal quarter (or
portion thereof) of the four fiscal quarters ending prior to the Issue Date, on
a pro forma basis to give effect to the Allied Acquisition as if it had occurred
at the beginning of such four-quarter period); provided, that
(1) if since the beginning of such period, such Parent or any
Restricted Subsidiary of such Parent has Incurred any Indebtedness that
remains outstanding on such date of determination or if the transaction
giving rise to the need to calculate the Consolidated Coverage Ratio is an
Incurrence of Indebtedness, Consolidated EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving effect on a pro
forma basis to such Indebtedness as if such Indebtedness had been Incurred
on the first day of such period (except that in making such computation,
the amount of Indebtedness under any revolving credit facility outstanding
on the date of such calculation shall be computed based on (A) the average
daily balance of such Indebtedness during such four fiscal quarters or
such shorter period for which such facility was outstanding or (B) if
such facility was created after the end of such four fiscal quarters, the
average daily balance of such Indebtedness during the period from the date
of creation of such facility to the date of such calculation),
(2) if since the beginning of such period, such Parent or any
Restricted Subsidiary of such Parent has repaid, repurchased, redeemed,
defeased or otherwise acquired, retired or discharged any Indebtedness
(each, a "Discharge") or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio involves a Discharge of
Indebtedness (in each case other than Indebtedness Incurred under any
revolving credit facility unless such Indebtedness has been permanently
repaid), Consolidated EBITDA and Consolidated Interest Expense for such
period shall be calculated after giving effect on a pro forma basis to
such Discharge of such Indebtedness, including with the proceeds of such
new Indebtedness, as if such Discharge had occurred on the first day of
such period,
(3) if since the beginning of such period, such Parent or any
Restricted Subsidiary of such Parent shall have disposed of any company,
any business or any group of assets constituting an operating unit of a
business (any such disposition, a "Sale"), the Consolidated EBITDA for
such period shall be reduced by an amount equal to the Consolidated EBITDA
(if positive) attributable to the assets that are the subject of such Sale
for such period or increased by an amount equal to the Consolidated EBITDA
(if negative) attributable thereto for such period and Consolidated
Interest Expense for such period shall be reduced by an amount equal to
(A) the Consolidated Interest Expense attributable to any Indebtedness of
such Parent or any Restricted Subsidiary of such Parent repaid,
repurchased,
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in the payment of the Optional Redemption Price, the Special Redemption
Price or the Mandatory Redemption Price, as the case may be.
(B) On or prior to the date fixed for redemption, each Holder of Junior
Preferred Stock shall surrender the certificate or certificates representing
such shares of Junior Preferred Stock to the Company, duly endorsed, in the
manner and at the place designated in the Redemption Notice, and on the
Redemption Date, the full Optional Redemption Price, the Special Redemption
Price or Mandatory Redemption Price, as the case may be, for such shares shall
be payable in cash to the Person whose name appears on such certificate or
certificates as the owner thereof, and each surrendered certificate shall be
canceled and retired. In the event that less than all of the shares represented
by any such certificate are redeemed, a new certificate shall be issued
representing the unredeemed shares.
(C) If the funds of the Company legally available for redemption of shares
of Junior Preferred Stock on any Redemption Date are insufficient to redeem the
total number of shares of Junior Preferred Stock to be redeemed on such date, or
if a complete redemption is not permitted by any Debt Agreement (or any Debt
Agreement does not permit NAVL to dividend sufficient legally available funds to
the Company to effect a complete redemption), those funds which are legally
available shall be used to redeem the maximum possible number of shares of the
Holders to the extent permitted by each Debt Agreement and to the extent NAVL is
permitted under each Debt Agreement to dividend an equal amount of funds to the
Company out of funds legally available therefor. At any time thereafter when
additional funds of the Company are legally available for the redemption of
shares, such funds shall immediately be used to redeem the balance of the shares
of Junior Preferred Stock which the Company has become obligated to redeem, on
any Redemption Date but which it has not redeemed, to the extent permitted by
each Debt Agreement and to the extent NAVL is permitted under each Debt
Agreement to dividend an equal amount of funds to the Company out of funds
legally available therefor.
(D) Unless the Company defaults in the payment in full of the applicable
redemption price, dividends on the Junior Preferred Stock called for redemption
shall cease to accumulate on the Redemption Date, and the Holders of such shares
shall cease to have any further rights with respect thereto on the Redemption
Date, other than the right to receive the Optional Redemption Price, the Special
Redemption Price or the Mandatory Redemption Price, as the case may be, without
interest.
(f) Voting Rights.
(i) The Holders of shares of the Junior Preferred Stock, except as
otherwise required under the laws of the State of Delaware or as set forth in
paragraph (f)(ii) below
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and in paragraphs (h) and (l) hereof, shall not be entitled or permitted to vote
on any matter required or permitted to be voted upon by the stockholders of the
Company.
(ii) So long as any shares of the Junior Preferred Stock are outstanding,
the Company shall not amend this Certificate of Designation so as to affect
adversely the specified rights, preferences, privileges or voting rights of the
Holders of shares of Junior Preferred Stock.
(iii) Notwithstanding paragraph (f)(ii) above, (1) the creation,
authorization or issuance of any shares of any Junior Securities, Parity
Securities or Senior Securities, (2) the decrease in the amount of authorized
capital stock of the Company of any class, (3) the increase in the amount of
authorized capital stock of the Company of any class or (4) the conversion or
exchange of the Junior Preferred Stock and any action in connection therewith in
accordance with paragraph (l)(i), shall not require the consent of the Holders
of Junior Preferred Stock and shall not be deemed to affect adversely the
rights, preferences, privileges or voting rights of the Holders of shares of the
Junior Preferred Stock.
(g) Exchange.
(i) Requirements. (A) The Company may at its option exchange all, but not
less than all, of the then outstanding shares of Junior Preferred Stock into the
Company's Exchange Debentures on any Dividend Payment Date, provided that on the
date of such exchange: (1) such exchange is not prohibited by the Debt
Agreements; (2) such exchange would comply with the Delaware General Corporation
Law; (3) either (a) a registration statement relating to the Exchange Debentures
shall have been declared effective under the Securities Act of 1933, as amended
(the "Securities Act"), prior to such exchange and shall continue to be in
effect on the date of such exchange or (b) (i) the Company shall have obtained a
written opinion of counsel to the Company that an exemption from the
registration requirements of the Securities Act is available for such exchange
and (ii) such exemption is relied upon by the Company for such exchange; and (4)
immediately after giving effect to such exchange, no Default or Event of Default
(each as defined in the Exchange Debentures) would exist under the Exchange
Debentures. In the event that the issuance of the Exchange Debentures is not
permitted on the date of exchange or any of the conditions set forth in clauses
(1) through (4) of the preceding sentence are not satisfied on the date of
exchange, the Company shall use its best efforts to satisfy such conditions and
effect such exchange as soon as practicable.
The Company shall send a written notice (the "Exchange Notice") of
exchange by mail to each Holder of record, which notice shall state: (v) that
the Company is exercising its option to exchange the Junior Preferred Stock for
Exchange Debentures
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pursuant to this Certificate of Designation; (w) the date fixed for exchange
(the "Exchange Date"), which date shall not be less than 30 days nor more than
60 days following the date on which the Exchange Notice is mailed (except as
provided in the next sentence of this paragraph); (x) that the Holder is to
surrender to the Company, at the place or places where certificates for shares
of Junior Preferred Stock are to be surrendered for exchange, in the manner
designated in the Exchange Notice, the certificate or certificates representing
the shares of Junior Preferred Stock to be exchanged; (y) that dividends on the
shares of Junior Preferred Stock to be exchanged shall cease to accrue on the
Exchange Date whether or not certificates for shares of Junior Preferred Stock
are surrendered for exchange on the Exchange Date unless the Company shall
default in the delivery of Exchange Debentures; and (z) that interest on the
Exchange Debentures shall accrue from the Exchange Date whether or not
certificates for shares of Junior Preferred Stock are surrendered for exchange
on the Exchange Date. On the Exchange Date, if the conditions set forth in
clauses (1) through (4) above are satisfied, the Company shall issue Exchange
Debentures in exchange for the Junior Preferred Stock as provided in the next
paragraph.
(B) Upon any exchange pursuant to paragraph (g)(i)(A), an Exchange
Debenture shall be issued in exchange for each share of Junior Preferred Stock,
in registered form without coupons, in a principal amount equal to the Stated
Amount as of such time.
(C) The Exchange Debentures shall be issued in long form without an
indenture and shall be in the form having substantially similar terms, as the
form of Exchange Debenture attached as Annex A hereto.
(ii) Procedure for Exchange. (A) On or before the date fixed for exchange,
each Holder of Junior Preferred Stock shall surrender the certificate or
certificates representing such shares of Junior Preferred Stock, in the manner
and at the place designated in the Exchange Notice. The Company shall cause the
Exchange Debentures to be executed on the Exchange Date and, upon surrender in
accordance with the Exchange Notice of the certificates for any shares of Junior
Preferred Stock so exchanged (properly endorsed or assigned for transfer, if the
notice shall so state), such shares shall be exchanged by the Company into
Exchange Debentures. The Company shall pay interest on the Exchange Debentures
at the rate and on the dates specified therein from the Exchange Date.
(B) If notice has been mailed as aforesaid, and if before the Exchange
Date all Exchange Debentures necessary for such exchange shall have been duly
executed by the Company, then on the Exchange Date, dividends shall cease to
accrue on the outstanding shares of Junior Preferred Stock and all of the rights
of the Holders of shares of the Junior Preferred Stock as stockholders of the
Company shall cease (except the right to receive Exchange Debentures), and the
Person or Persons entitled to receive the Exchange
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Debentures issuable upon exchange shall be treated for all purposes as the
registered holder or holders of such Exchange Debentures as of the date of
exchange.
(h) Change of Control.
(i) Unless otherwise consented to by the Holders of a majority of the
outstanding shares of Junior Preferred Stock, upon the occurrence after the
Issue Date of a Change of Control, each Holder of Junior Preferred Stock then
outstanding, subject to the other provisions of this paragraph (h), shall have
the right (subject to the Debt Agreements (including the availability of funds
by dividend from NAVL in compliance therewith), and to the legal availability of
funds therefor) to require the Company to purchase any or all of such Holder's
shares of Junior Preferred Stock pursuant to an offer (an "Offer") at a purchase
price per share in cash equal to 101% of the Liquidation Preference of such
share at the purchase date, plus, without duplication, an amount in cash equal
to all accumulated and unpaid dividends with respect to such share (including an
amount in cash equal to a prorated dividend for the period from the Dividend
Payment Date immediately prior to the purchase date, to the purchase date)
(collectively, the "Change of Control Purchase Price"). Unless the Company has
exercised its right to redeem the Junior Preferred Stock as described under
paragraph (e) above, the Company shall, not later than 30 days following the
date the Company obtains actual knowledge of any Change of Control having
occurred, mail a notice (the "Purchase Notice") to each Holder of record
stating: (1) that a Change of Control has occurred or may occur and that such
Holder has, or upon such occurrence will have, the right (subject to the Debt
Agreements (including the availability of funds by dividend from NAVL in
compliance therewith), and to the legal availability of funds therefor) to
require the Company to purchase any or all shares of such Holder's Junior
Preferred Stock at a purchase price per share in cash equal to 101% of the
Liquidation Preference thereof on the relevant Purchase Date, plus, without
duplication, an amount in cash equal to all accumulated and unpaid dividends, if
any, with respect to such share; (2) the circumstances and relevant facts and
financial information regarding such Change of Control; (3) the date fixed for
such purchase (which shall be no earlier than 30 days nor later than 60 days
from the date such notice is mailed); (4) the instructions determined by the
Company, consistent with this paragraph (h), that a Holder must follow in order
to have its shares of Junior Preferred Stock purchased; and (5) if such notice
is mailed prior to the occurrence of a Change of Control, that such Offer is
conditioned on the occurrence of such Change of Control.
(ii) Holders of Junior Preferred Stock electing to have shares of Junior
Preferred Stock purchased shall be required to surrender the certificate or
certificates representing such shares of Junior Preferred Stock, duly endorsed,
to the Company in the manner and at the address specified in the Purchase Notice
at least three Business Days prior to the date fixed for such purchase. On the
Purchase Date, the Change of Control Purchase
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Price for such shares shall become payable in cash to the Person whose name
appears on such certificate or certificates as the owner thereof. In the event
that less than all of the shares represented by any such certificate are
purchased, a new certificate shall be issued representing the shares not
purchased.
(iii) If the funds of the Company legally available for any purchase of
shares of Junior Preferred Stock under this paragraph (h) on any Purchase Date
are insufficient to purchase the total number of shares of Junior Preferred
Stock to be purchased on such date or if a complete purchase is not permitted by
any Debt Agreement (or any Debt Agreement does not permit NAVL to dividend
sufficient legally available funds to the Company to effect a complete
purchase), those funds which are legally available shall be used to purchase the
maximum possible number of shares of the Holders to the extent permitted by each
Debt Agreement and to the extent NAVL is permitted to dividend an equal amount
of funds to the Company under each Debt Agreement out of funds legally available
therefor. At any time thereafter when additional funds of the Company are
legally available for the purchase of shares, such funds shall immediately be
used to purchase the balance of the shares of Junior Preferred Stock which the
Company has become obligated to purchase on any Purchase Date but which it has
not purchased, to the extent permitted by each Debt Agreement and to the extent
NAVL is permitted to dividend an equal amount of funds to the Company under each
Debt Agreement out of funds legally available therefor.
(iv) Unless the Company defaults in the payment in full of the applicable
Change of Control Purchase Price, dividends on the Junior Preferred Stock
tendered for purchase shall cease to accumulate on the date fixed for such
purchase, and the Holders of such shares shall cease to have any further rights
with respect thereto on the such date, other than the right to receive the
Change of Control Purchase Price without interest.
(v) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the purchase of Junior Preferred Stock
pursuant to this paragraph (h). To the extent that the provisions of any
securities laws or regulations conflict with provisions of this paragraph (h),
the Company will comply with the applicable securities laws and regulations and
will not be deemed to have breached its obligations under this paragraph (h) by
virtue thereof.
(vi) Notwithstanding any other provision of this paragraph (h), the
Company shall not be required to purchase any shares of Junior Preferred Stock
under this paragraph (h), (A) unless NAVL is required to purchase or repay the
outstanding Notes and Senior Discount Notes pursuant to the Indentures and has
offered to purchase or repay in full all of the outstanding Notes and Senior
Discount Notes and has so purchased or repaid in full all of the outstanding
Notes and Senior Discount Notes of each holder of any Note or Senior
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Discount Note who has accepted such offer and (B) unless the principal of and
all accrued and unpaid interest on all indebtedness under the Senior Credit
Facility, and all other monetary obligations owing in respect of the Senior
Credit Facility, shall have been paid in full, and all letters of credit,
bankers acceptances and similar instruments outstanding thereunder shall have
expired undrawn.
(i) Conversion or Exchange.
The Holders of shares of Junior Preferred Stock shall not have any rights
hereunder to convert such shares into or exchange such shares for shares of any
other class or classes or of any other series of any class or classes of Capital
Stock of the Company.
(j) Preemptive Rights.
No shares of Junior Preferred Stock shall have any rights of preemption
whatsoever as to any securities of the Company, or any warrants, rights or
options issued or granted with respect thereto, regardless of how such
securities or such warrants, rights or options may be designated, issued or
granted.
(k) Business Day.
If any payment, redemption or exchange would be required by the terms
hereof to be made on a day that is not a Business Day, such payment, redemption
or exchange shall be made (and deemed required to be made) on the immediately
succeeding Business Day.
(l) Certain Additional Provisions.
(i) Merger or Consolidation (A) Without the consent of the Holders of a
majority of the outstanding shares of Junior Preferred Stock, the Company will
not consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person, unless: (1) the resulting,
surviving or transferee Person (the "Successor Company") will be a Person
organized and existing under the laws of the United States of America, any State
thereof or the District of Columbia; (2) if the Successor Company is not the
Company, the Junior Preferred Stock shall be converted into or exchanged for and
shall become Capital Stock of the Successor Company ("Successor Company Stock")
having, in respect of such Successor Company, substantially the same preferences
and relative participating, optional or other special rights, and
qualifications, limitations or restrictions thereon, as applied to the Junior
Preferred Stock immediately prior to such transaction; (3) immediately after
giving effect
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to such transaction (and treating any Indebtedness that becomes an obligation of
the Successor Company or any Restricted Subsidiary as a result of such
transaction as having been Incurred by the Successor Company or such Restricted
Subsidiary at the time of such transaction) no Mandatory Redemption Event will
have occurred and be continuing; and (4) the Company will have obtained an
Officer's Certificate and an Opinion of Counsel, each to the effect that such
consolidation, merger or transfer complies with this paragraph (l)(i)(A),
provided that (x) in giving such opinion such counsel may rely on an Officer's
Certificate as to compliance with the foregoing clauses (2) and (3) and as to
any matters of fact, and (y) no Opinion of Counsel will be required for a
consolidation, merger or transfer described in paragraph (l)(i)(B) below. Any
Indebtedness that becomes an obligation of the Company or any Restricted
Subsidiary (or that is deemed to be Incurred by any Restricted Subsidiary that
becomes a Restricted Subsidiary) as a result of any such transaction undertaken
in compliance with this paragraph (1)(i), and any Refinancing Indebtedness with
respect thereto, shall be deemed to have been Incurred in compliance with
paragraph (l)(iii).
(B) Any merger, consolidation, conveyance, transfer or lease by the
Company in compliance with this paragraph (l)(i) shall not be subject to the
provisions of paragraph (d) above.
(C) Paragraph (l)(i)(A) above shall not apply to any transaction in which
(1) any Restricted Subsidiary consolidates with, merges into or transfers all or
part of its assets to the Company or (2) the Company consolidates or merges with
or into or transfers all or substantially all its properties and assets to (x)
an Affiliate incorporated or organized for the purpose of reincorporating or
reorganizing the Company in another jurisdiction or changing its legal structure
to a corporation or other entity or (y) a Restricted Subsidiary of the Company
so long as all assets of the Company and the Restricted Subsidiaries immediately
prior to such transaction (other than Capital Stock of such Restricted
Subsidiary) are owned by such Restricted Subsidiary and its Restricted
Subsidiaries immediately after the consummation thereof.
(D) Notwithstanding any other provision of this Certificate of
Designation, each of the Company and any Successor Company shall have the right
and power, without the consent or any act of any Holder, to amend or cancel this
Certificate of Designation or take any other action necessary (as determined by
the Company or such Successor Company in good faith) to effect any conversion or
exchange of the Junior Preferred Stock contemplated by paragraph (l)(i)(A)(2)
above. Without limiting the foregoing:
(1) In the event the Company or such Successor Company has effected
or intends to effect such a conversion or exchange (a "Conversion Event"),
it will send a written notice (the "Conversion Notice") by mail to each
Holder of record, provided
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that no failure to give such notice nor any deficiency therein shall
affect the validity of the procedure for the conversion or exchange of any
shares of Junior Preferred Stock to be converted or exchanged except as to
the Holder or Holders to whom the Company has failed to give such notice
or except as to the Holder or Holders whose notice was defective. The
Conversion Notice shall state: (x) that a Conversion Event has occurred or
that the Company or a Successor Company intends to effect a Conversion
Event; (y) that the Holder is to surrender to the Company or the Successor
Company the certificate or certificates representing the shares of Junior
Preferred Stock to be converted or exchanged, the place or places where
such certificate or certificates are to be surrendered and the manner in
which such certificate or certificates are to be surrendered; and (z) that
upon surrender of the certificate or certificates representing the shares
of Junior Preferred Stock to be converted or exchanged in the manner
designated in the Conversion Notice, the Holder shall be entitled to
receive from the Successor Company a certificate or certificates
representing shares of Successor Company Stock thereof.
(2) Each Holder of Junior Preferred Stock shall surrender the
certificate or certificates representing such shares of Junior Preferred
Stock, at the place and in the manner designated in the Conversion Notice,
promptly upon its receipt of the Conversion Notice and in no event later
than 30 days following the date on which the Conversion Notice is mailed.
On the date that is 30 days following the date on which the Conversion
Notice is mailed and provided that the Holder has surrendered the
certificate of certificates representing the shares of Junior Preferred
Stock, the Holder shall be entitled to receive from the Successor Company
a certificate or certificates representing shares of Successor Company
Stock thereof in accordance with the Conversion Notice.
(3) On the date on which the merger, consolidation, conveyance,
transfer or lease transaction giving rise to the Conversion Event occurs
(the "Conversion Date"), and provided that all shares of Successor Company
Stock necessary to effect the Conversion Event have been duly issued by
the Successor Company in the respective names of the Holders of record as
at such date that are entitled thereto, then dividends shall cease to
accrue on the outstanding shares of Junior Preferred Stock and all of the
rights of the Holders of shares of the Junior Preferred Stock as
stockholders of the Company shall cease, and the Person or Persons
entitled to receive the Successor Company Stock issuable on the Conversion
Date shall be treated for all purposes as the registered holder or holders
of such Successor Company Stock as of the Conversion Date.
(ii) Junior Payments. (A) Without the consent of the Holders of a majority
of the outstanding shares of Junior Preferred Stock, the Company shall not, and
shall not
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permit any Restricted Subsidiary, directly or indirectly, to (i) declare or pay
any dividend or make any distribution on or in respect of any Junior Securities
of the Company, including any such payment in connection with any merger or
consolidation to which the Company is a party, except (x) dividends or
distributions payable solely in its Capital Stock (other than Disqualified
Stock) and (y) dividends or distributions payable to the Company or any
Restricted Subsidiary, or (ii) purchase, redeem, retire or otherwise acquire for
value, prior to scheduled maturity, scheduled repayment or scheduled sinking
fund payment, any Junior Securities of the Company held by Persons other than
the Company or any Restricted Subsidiary (other than a purchase, redemption,
retirement, or other acquisition for value in anticipation of satisfying a
sinking fund obligation, principal installment or final maturity, in each
case due within one year of the date of such acquisition) (any such dividend,
distribution, purchase, redemption, retirement or other acquisition being
herein referred to as a "Junior Payment"), if at the time the Company or such
Restricted Subsidiary makes such Junior Payment:
(1) a Mandatory Redemption Event shall have occurred and be
continuing (or would result therefrom);
(2) NAVL could not incur at least an additional $1.00 of
Indebtedness pursuant to paragraph (l)(iii)(A) below; or
(3) the aggregate amount of such Junior Payment and all other Junior
Payments (the amount so expended, if other than in cash, to be as
determined in good faith by the Board, whose determination shall be
conclusive) declared or made subsequent to the Issue Date and then
outstanding would exceed the sum of:
(a) 50% of the Consolidated Net Income of the Company or (if
greater) of NAVL accrued during the period (treated as one
accounting period) from September 30, 1999 to the end of the most
recent fiscal quarter ending prior to the date of such Junior
Payment for which consolidated financial statements of the Company
or NAVL, as the case may be, are available (or, in case each such
Consolidated Net Income shall be a negative number, 100% of the
smaller such negative number); and
(b) the aggregate Net Cash Proceeds and the fair market value
of Qualified Proceeds received (x) by the Company as capital
contributions to the Company after the Issue Date or from the
issuance or sale (other than to a Restricted Subsidiary) of its
Capital Stock (other than Disqualified Stock) after the Issue Date
or (y) by the Company or any Restricted Subsidiary from the issuance
and sale by the Company or any Restricted Subsidiary after the Issue
Date of Indebtedness that shall have been converted into or
exchanged for Capital Stock
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of the Company (other than Disqualified Stock), plus the amount of
cash and the fair market value of Qualified Proceeds received by the
Company or any Restricted Subsidiary upon such conversion or
exchange.
(B) The provisions of the foregoing paragraph (l)(ii)(A) will not prohibit
any of the following (each, a "Permitted Payment"):
(1) any purchase, redemption, retirement or other acquisition of
Capital Stock of the Company made by exchange (including any such exchange
pursuant to the exercise of a conversion right or privilege in connection
with which cash is paid in lieu of the issuance of fractional shares) for,
or conversion into, or out of the proceeds of the substantially concurrent
issuance or sale of, Capital Stock of the Company (other than Disqualified
Stock and other than Capital Stock issued or sold to a Subsidiary) or out
of the proceeds of a substantially concurrent capital contribution to the
Company; provided, that the Net Cash Proceeds from such issuance, sale or
capital contribution shall be excluded in subsequent calculations under
clause (3)(b) of the preceding paragraph (l)(ii)(A);
(2) any purchase, redemption, retirement or other acquisition of
Junior Securities (x) made by exchange for, or out of the proceeds of the
substantially concurrent issuance or sale of, Refinancing Indebtedness
Incurred in compliance with paragraph (l)(iii) below or (y) to the extent
required by the agreement governing such Junior Securities following the
occurrence of a Change of Control, but only if in each case, the Company
shall have complied with paragraph (h) above and, if required, purchased
all shares of Junior Preferred Stock tendered pursuant to an Offer to
purchase such shares required thereby, prior to purchasing or repaying
such Junior Securities;
(3) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividend would have complied
with the preceding paragraph (l)(ii)(A);
(4) payments to repurchase or otherwise acquire Capital Stock
(including any options, warrants or other rights in respect thereof), in
each case from Management Investors, such payments not to exceed an amount
(net of repayments of any such loans or advances equal to (a) $12.5
million plus (b) $2.5 million multiplied by the number of calendar years
that have commenced since the Issue Date plus (c) the Net Cash Proceeds
received by the Company or NAVL since the Issue Date from, or as a capital
contribution from, the issuance or sale of Capital Stock (including any
options, warrants or other rights in respect thereof), to the extent such
Net Cash Proceeds are
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not included in any calculation under clause (3)(b)(x) of the preceding
paragraph (l)(ii)(A);
(5) the payment of dividends on the common stock or equity of the
Company following a public offering of such common stock or equity, in an
amount not to exceed in any fiscal year 6% of the aggregate gross proceeds
received by the Company in or from such public offering;
(6) Junior Payments (including loans or advances) in an aggregate
amount outstanding at any time not to exceed $10.0 million (net of
repayments of any such loans or advances);
(7) payments to satisfy obligations under the Management Agreements
to pay any Holding Expenses;
(8) payments to holders of Capital Stock of the Company in lieu of
issuance of fractional shares of such Capital Stock, not to exceed
$100,000 in the aggregate outstanding at any time;
(9) the distribution, as a dividend or otherwise, of Investments in
Unrestricted Subsidiaries;
(10) the Transactions;
(11) any purchase, redemption, retirement or other acquisition of
Capital Stock that may be deemed to occur upon exercise of stock options,
warrants or similar rights to the extent such Capital Stock represents all
or part of the exercise price thereof; and
(12) Junior Payments by any Restricted Subsidiary that are permitted
by the Senior Credit Facility or any Indenture;
provided, that (A) in the case of clauses (3) and (5), the net amount of
any such Permitted Payment shall be included in subsequent calculations of
the amount of Junior Payments, (B) in the case of clause (4), 50% of the
amount of any such Permitted Payment shall be included in subsequent
calculations of the amount of Junior Payments, (C) in the case of clause
(12), the net amount of any such Permitted Payment shall be included in
subsequent calculations of the amount of Junior Payments to the extent
that such net amount is required under each Indenture to be included in
concurrent calculations of the amount of Restricted Payments (as defined
in such Indenture) under Section 4.08 of the Note Indenture, Section 4.08
of the Senior Discount Note Indenture and Section 6.7 of the
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Senior Discount Loan Agreement, (D) in all cases other than pursuant to
clauses (A), (B) and (C) immediately above, the net amount of any such
Permitted Payment shall be excluded in subsequent calculations of the
amount of Junior Payments and (E) with respect to clauses (5) and (6), no
Mandatory Redemption Event shall have occurred or be continuing at the
time of any such Permitted Payment after giving effect thereto.
(iii) Limitation on Indebtedness. (A) Without the consent of the
Holders of a majority of the outstanding shares of Junior Preferred Stock,
the Company will not, and will not permit any Restricted Subsidiary to,
Incur any Indebtedness; provided, however, that (1) the Company or any
Restricted Subsidiary may incur Indebtedness if on the date of the
Incurrence of such Indebtedness, after giving effect to the Incurrence
thereof, the Consolidated Coverage Ratio of the Company would be greater
than 1.75:1.00 if such Indebtedness is Incurred on or prior to December 1,
2001 or 2.00:1.00 if such Indebtedness is Incurred thereafter and (2) NAVL
or any Note Guarantor may Incur Indebtedness if on the date of the
Incurrence of such Indebtedness, after giving effect to the Incurrence
thereof, the Consolidated Coverage Ratio of NAVL would be greater than
2.00:1.00 if such Indebtedness is Incurred on or prior to December 1, 2001
or 2.25:1.00 if such indebtedness is Incurred thereafter.
(B) Notwithstanding the foregoing paragraph (1)(iii)(A), the Company
and its Restricted Subsidiaries may Incur the following Indebtedness:
(1) Indebtedness Incurred pursuant to Credit Facilities
(including but not limited to in respect of letters of credit or
bankers' acceptances issued or created thereunder) and (without
limiting the foregoing) any Refinancing Indebtedness in respect
thereof, in a maximum principal amount at any time outstanding
(giving effect to any refinancing thereof) not exceeding in the
aggregate the amount equal to the sum of (x) $475.0 million and (y)
the aggregate amount by which the Borrowing Base determined as of
the date of such Incurrence exceeds $245.0 million (plus in the case
of any refinancing of any Credit Facility or any portion thereof,
the aggregate amount of fees, underwriting discounts, premiums and
other costs and expenses incurred in connection with such
refinancing);
(2) Indebtedness (a) of any Restricted Subsidiary to the
Company or (b) of the Company or any Restricted Subsidiary to any
Restricted Subsidiary; provided, that any subsequent issuance or
transfer of any Capital Stock of such Restricted Subsidiary to which
such Indebtedness is owed, or other event, that results in such
Restricted Subsidiary ceasing to be a Restricted Subsidiary or any
other subsequent transfer of such Indebtedness (except to the
Company or a Restricted Subsidiary) will be deemed, in each case, an
Incurrence of such Indebtedness by the issuer thereof;
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(3) Indebtedness represented by the Exchange Debentures, the
Notes and the Senior Discount Notes (other than Additional Notes),
any Indebtedness (other than the Indebtedness described in clauses
(1) or (2) above) outstanding on the Issue Date and any Refinancing
Indebtedness Incurred in respect of any Indebtedness described in
this clause (3) or paragraph (l)(iii)(A) above;
(4) Purchase Money Obligations and Capitalized Lease
Obligations, and any Refinancing Indebtedness with respect thereto,
in an aggregate principal amount at any time outstanding (giving
effect to any refinancing thereof) not exceeding an amount equal to
the greater of (x) $35.0 million and (y) 5% of Consolidated Tangible
Assets;
(5) Indebtedness of any Person that is assumed by the Company
or any Restricted Subsidiary in connection with its acquisition of
assets from such Person or any Affiliate thereof or is issued and
outstanding on or prior to the date on which such Person was
acquired by the Company or any Restricted Subsidiary or merged or
consolidated with or into any Restricted Subsidiary (other than
Indebtedness Incurred to finance, or otherwise in connection with,
such acquisition), provided that on the date of such acquisition,
merger or consolidation, after giving effect thereto, NAVL could
Incur at least $1.00 of additional Indebtedness pursuant to
paragraph (1)(iii)(A) above; and any Refinancing Indebtedness with
respect to any such Indebtedness;
(6)(a) Guarantees by the Company or any Restricted Subsidiary
of Indebtedness or any other obligation or liability of the Company
or any Restricted Subsidiary (other than any Indebtedness incurred
by the Company or such Restricted Subsidiary, as the case may be, in
violation of this paragraph (l)(iii)), or (b) Indebtedness of the
Company or any Restricted Subsidiary arising by reason of any Lien
granted by or applicable to such Person securing Indebtedness of the
Company or any Restricted Subsidiary (other than any Indebtedness
incurred by the Company or such Restricted Subsidiary, as the case
may be, in violation of this paragraph (l)(iii));
(7) Indebtedness of the Company or any Restricted Subsidiary
(a) arising from the honoring of a check, draft or similar
installment of such Person drawn against insufficient funds,
provided that such Indebtedness is extinguished within five Business
Days of its incurrence, or (b) consisting of guarantees,
indemnities, obligations in respect of earnouts or other purchase
price adjustments, or similar obligations, Incurred in connection
with the acquisition or disposition of any business, assets or
Person (including pursuant to the Allied Acquisition);
(8) Indebtedness of the Company or any Restricted Subsidiary
in respect of (a) letters of credit, bankers' acceptances or other
similar instruments or obligations
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issued, or relating to liabilities or obligations incurred, in the
ordinary course of business (including those issued to governmental
entities in connection with self-insurance under applicable workers'
compensation statutes), or (b) completion guarantees, surety,
judgment, appeal or performance bonds, or other similar bonds,
instruments or obligations, provided, or relating to liabilities or
obligations incurred, in the ordinary course of business, or (c)
Hedging Obligations entered into for bona fide hedging purposes in
the ordinary course of business, (d) Management Guarantees, (e)
Agent Guarantees in an aggregate principal amount not exceeding
$10.0 million outstanding at any time, or (f) the financing of
insurance premiums in the ordinary course of business;
(9) Indebtedness of a Receivables Subsidiary secured by a Lien
on all or part of the assets disposed of in, or otherwise incurred
in connection with, a Financing Disposition, which Indebtedness is,
except for Standard Receivables Obligations, otherwise without
recourse to NAVL or any Restricted Subsidiary (other than any
Receivables Subsidiary);
(10) Indebtedness of a Foreign Subsidiary of the Company or
NAVL if; on the date of Incurrence of such Indebtedness, after
giving effect to the Incurrence thereof, (x) the Consolidated
Coverage Ratio of the Company or NAVL would be at least 2.25:1.00
and (y) if, as a result of such Incurrence, such Foreign Subsidiary
shall then become subject to any restriction or limitation (under
any agreement or instrument governing such Indebtedness) on its
ability to pay dividends or make other distributions to NAVL, the
Foreign Subsidiary Coverage Ratio of the Company or NAVL would be
greater than 2.75:1.00; provided, that if such Indebtedness is not
incurred pursuant to the preceding clause (y), such Indebtedness
shall not be amended, modified or otherwise supplemented such that
such Foreign Subsidiary will become subject to any such restriction
or limitation referred to in such clause unless such Indebtedness
could then be Incurred pursuant to such clause; and any Refinancing
Indebtedness with respect to any such Indebtedness;
(11) Indebtedness of the Company or any Restricted Subsidiary
in an aggregate principal amount at any time outstanding (giving
effect to any refinancing thereof) not exceeding an amount equal to
$95.0 million;
(12) Indebtedness of any Restricted Subsidiary that is
permitted to be Incurred under the Senior Credit Facility or any
Indenture; and
(13) Indebtedness under the Interim Loan Facility, in an
aggregate principal amount not to exceed $40.0 million outstanding
at any time.
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(C) For purposes of determining compliance with, and the outstanding
principal amount of any particular Indebtedness Incurred pursuant to and in
compliance with, this covenant, (i) any other obligation of the obligor on such
Indebtedness (or of any other Person who could have Incurred such Indebtedness
under this covenant) arising under any Guarantee, Lien or letter of credit,
bankers' acceptance or other similar instrument or obligation supporting such
Indebtedness shall be disregarded to the extent that such Guarantee, Lien or
letter of credit, bankers' acceptance or other similar instrument or obligation
secures the principal amount of such Indebtedness; (ii) in the event that
Indebtedness meets the criteria of more than one of the types of Indebtedness
described in paragraph (l)(iii)(B) above, the Company, in its sole discretion,
shall classify such item of Indebtedness and only be required to include the
amount and type of such Indebtedness in one of such clauses; and (iii) the
amount of Indebtedness issued at a price that is less than the principal amount
thereof shall be equal to the amount of the liability in respect thereof
determined in accordance with GAAP.
(D) For purposes of determining compliance with any Dollar-denominated
restriction on the Incurrence of Indebtedness denominated in a foreign currency,
the Dollar-equivalent principal amount of such Indebtedness Incurred pursuant
thereto shall be calculated based on the relevant currency exchange rate in
effect on the date that such Indebtedness was Incurred, in the case of term
Indebtedness, or first committed, in the case of revolving credit Indebtedness,
provided that (x) the Dollar-equivalent principal amount of any such
Indebtedness outstanding on the Issue Date shall be calculated based on the
relevant currency exchange rate in effect on the Issue Date, (y) if such
Indebtedness is Incurred to refinance other Indebtedness denominated in a
foreign currency, and such refinancing would cause the applicable
Dollar-denominated restriction to be exceeded if calculated at the relevant
currency exchange rate in effect on the date of such refinancing, such
Dollar-denominated restriction shall be deemed not to have been exceeded so long
as the principal amount of such refinancing Indebtedness does not exceed the
principal amount of such Indebtedness being refinanced and (z) the
Dollar-equivalent principal amount of indebtedness denominated in a foreign
currency and Incurred pursuant to the Senior Credit Facility shall be calculated
based on the relevant currency exchange rate in effect on, at the Company's
option, (i) the Issue Date, (ii) any date on which any of the respective
commitments under the Senior Credit Facility shall be reallocated between or
among facilities or subfacilities thereunder, or on which such rate is otherwise
calculated for any purpose thereunder, or (iii) the date of such Incurrence. The
principal amount of any Indebtedness Incurred to refinance other Indebtedness,
if Incurred in a different currency from the Indebtedness being refinanced,
shall be calculated based on the currency exchange rate applicable to the
currencies in which such respective Indebtedness is denominated that is in
effect on the date of such refinancing.
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(iv) Withholding. Notwithstanding any other provision of this Certificate
of Designation, in the event that the Company makes any tax payment in respect
of any share of Junior Preferred Stock (including but not limited to any
withholding tax payment made by the Company under Chapter 3 of Subtitle A of the
Code):
(A) if the tax payment is in respect of a cash distribution made on such
share, the amount of such cash distribution paid to the Holder of such share
shall be reduced by the amount of such tax payment, provided that for all
purposes hereof the Holder of such share shall be treated as having received the
amount of such tax payment as part of such cash distribution and as having paid
over such tax payment to the taxing authority to which it was paid; and
(B) if the tax payment is not in respect of a cash distribution made on
such share (or exceeds a cash distribution made on such share), the Liquidation
Preference of such share as of the time of such tax payment shall be reduced by
the amount of such tax payment (or the amount of such excess) through an
increase (without duplication) in the Adjustment Amount.
If and to the extent that a Holder of any share of Junior Preferred Stock remits
cash to the Company for the specified purpose of funding a tax payment to be
made by the Company in respect of such share, and such cash is received by the
Company prior to the time that the Company makes such tax payment, then such tax
payment shall be disregarded for purposes of the preceding sentence. If
requested by any Holder of any share of Junior Preferred Stock, the Company
shall consult in good faith with such Holder concerning the Company's
obligations to make any tax payments in respect of such share.
(v) Register. The Company shall keep a register of the Holder of each
share of Junior Preferred Stock and the Adjustment Amount (if any) with respect
to each such share.
(m) Restrictions on Transfer.
(i) Restriction. Unless a Redemption Notice has been given by the Company,
the Junior Preferred Stock shall not be Transferred, directly or indirectly, by
any Holder (other than by or to the Company or a Subsidiary thereof) (x) unless
the minimum number of shares to be Transferred shall be at least 10,000 and (y)
except as provided in this paragraph (m). Notwithstanding the foregoing, the
restrictions set forth in paragraph (m) (v) below shall not apply in the case
of a Transfer by the Holder to a direct or indirect Subsidiary of NEC that
remains such a Subsidiary.
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(ii) Restrictive Legend. Except as otherwise permitted by this paragraph
(m), each certificate for Junior Preferred Stock shall be registered in the
stock register of the Company and be stamped or otherwise imprinted with a
legend in substantially the following form:
"EACH SHARE OF JUNIOR PREFERRED STOCK MAY HAVE ITS OWN LIQUIDATION
PREFERENCE AND STATED AMOUNT, WHICH MAY BE SIGNIFICANTLY GREATER OR LESS
THAN OTHER SHARES. ABSENT MANIFEST ERROR, THE AMOUNT OF LIQUIDATION
PREFERENCE SET FORTH IN THE STOCK REGISTER FOR EACH NUMBERED SHARE SHALL
BE CONCLUSIVE. PROSPECTIVE TRANSFEREES SHOULD REFER TO THE STOCK REGISTER
TO DETERMINE THE LIQUIDATION PREFERENCE OF ANY SHARES THAT THEY MAY BE
RECEIVING."
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TRANSFER
RESTRICTIONS SET FORTH IN THE CERTIFICATE OF DESIGNATION OF THE JUNIOR
EXCHANGEABLE PREFERRED STOCK OF THE COMPANY FILED WITH THE SECRETARY OF
STATE OF THE STATE OF DELAWARE AND NEITHER THIS CERTIFICATE NOR THE SHARES
REPRESENTED BY IT ARE ASSIGNABLE OR OTHERWISE TRANSFERABLE EXCEPT IN
ACCORDANCE WITH THE PROVISIONS OF SUCH CERTIFICATE OF DESIGNATION, A COPY
OF WHICH IS ON FILE WITH THE SECRETARY OF NA HOLDING CORPORATION."
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE OR FOREIGN
SECURITIES LAWS AND MAY NOT BE TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS (i) (A) SUCH DISPOSITION IS PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, (B) THE HOLDER HEREOF SHALL HAVE DELIVERED TO NA HOLDING
CORPORATION AN OPINION OF COUNSEL, WHICH OPINION AND COUNSEL SHALL BE
REASONABLY SATISFACTORY TO NA HOLDING CORPORATION, TO THE EFFECT THAT SUCH
DISPOSITION IS EXEMPT FROM THE PROVISIONS OF SECTION 5 OF SUCH ACT OR (C)
A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION, REASONABLY
SATISFACTORY TO COUNSEL FOR NA HOLDING CORPORATION, SHALL HAVE BEEN
OBTAINED WITH RESPECT TO SUCH DISPOSITION AND (ii) SUCH DISPOSITION IS
PURSUANT TO REGISTRATION UNDER ANY
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APPLICABLE STATE OR FOREIGN SECURITIES LAWS OR AN EXEMPTION THEREFROM."
"ANY TRANSFEREE OF THE SHARES REPRESENTED BY THIS CERTIFICATE (EITHER OF
THE ORIGINAL HOLDER OF THE SHARES OR ANY TRANSFEREE OF SUCH HOLDER) BY ITS
ACCEPTANCE HEREOF (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"))
AND (2) AGREES FOR THE BENEFIT OF THE COMPANY THAT THE SHARES REPRESENTED
BY THIS CERTIFICATE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED OR DISPOSED OF ONLY (I) TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (II) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR (III) TO THE COMPANY, IN EACH OF CASES (I) THROUGH
(III)IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES, AND SUBJECT TO THE COMPANY'S RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING ON THE OTHER SIDE OF THIS CERTIFICATE IS COMPLETED AND
DELIVERED BY THE TRANSFEROR TO THE COMPANY. THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE SHARES
REPRESENTED BY THIS CERTIFICATE FROM IT OF THE RESALE RESTRICTION REFERRED
TO ABOVE."
(iii) Notice of Proposed Transfer. Subject to the rights of the Company
under paragraphs (m)(iv) and (m)(v), prior to any Transfer of any shares of
Junior Preferred Stock that are not registered under an effective registration
statement under the Securities Act, the Holder of such shares of Junior
Preferred Stock shall give written notice (a "Transfer Notice") to the Company
of such Holder's intention to effect such Transfer by completing the form of
Transfer Notice attached hereto as Annex B, the text of which will appear on the
reverse side of the certificate evidencing shares of Junior Preferred Stock.
Each certificate for Junior Preferred Stock, if any, issued upon or in
connection with such Transfer shall bear the appropriate restrictive legend set
forth in paragraph (m)(ii), unless, in the opinion of counsel to the Company,
such legend is no longer required to ensure compliance with the Securities Act.
(iv) [Intentionally Omitted]
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(v) Company Consent. Notwithstanding any other provision of this
Certificate of Designation (other than the second sentence of paragraph (m)(i)),
no Transfer of the shares of Preferred Stock will be permitted, and the Company
shall have no obligation to record any such Transfer, unless the Company shall
have consented to the Transfer in writing, such consent not to be unreasonably
withheld, provided that (A) for the avoidance of doubt the Company may take into
account the withholding taxes (if any) that would be applicable in respect of
the proposed transferee and (B) this paragraph (m)(v) shall not apply in the
case of a Transfer of shares of Junior Preferred Stock with respect to which a
Redemption Notice has been delivered and is currently in effect.
(n) Definitions.
(1) Rules of Construction. For all purposes of this Certificate of
Designation, except as otherwise expressly provided or unless the context
otherwise requires:
(A) the terms defined in this Certificate of Designation have the meanings
assigned to them in this Certificate of Designation;
(B) "or" is not exclusive;
(C) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with GAAP;
(D) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Certificate of Designation as a whole and not to
any particular paragraph or other subdivision;
(E) all references to "$" or "dollars" shall refer to the lawful currency
of the United States of America;
(F) the words "include," "included" and "including" as used herein shall
be deemed in each case to be followed by the phrase "without limitation" if not
expressly followed by such phrase or the phrase "but not limited to"; and
(G) any reference to a paragraph refers to the specified paragraph of the
Certificate of Designation.
(2) Specific Definitions. As used in this Certificate of Designation, the
following terms shall have the following meanings (with terms defined in the
singular having comparable meanings when used in the plural and vice versa),
unless the context otherwise requires:
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"Additional Notes" has the meaning specified in the applicable Indenture.
"Adjustment Amount" means, with respect to any share of Junior Preferred
Stock at any time, the sum of (i) the aggregate amount of the reductions made
with respect to such share pursuant to paragraph (1)(iv)(B) and (ii) an amount,
as of any time, equal to the quotient of (A) an aggregate amount equal to, for
each year until and including the fifth anniversary of the Issue Date, one half
of the excess of (x) all interest paid or accrued (whether or not paid) on the
Notes (excluding any Additional Notes), the Senior Discount Notes and $25.0
million aggregate principal amount of borrowings under the Tranche B Term Loan
Facility (as such term is defined in the Senior Credit Facility) as of such time
over (y) all interest that would have been paid or accrued as of such time on
debt securities in an aggregate principal amount of $210 million (the "Base
Amount") with the same final Stated Maturity as the Notes and bearing interest
at 12% per annum, with semi-annual interest payments (based on a 360-day year
consisting of twelve 30-day months) and no principal payment due prior to such
final Stated Maturity divided by (B) the total number of outstanding shares of
Junior Preferred Stock, provided that the aggregate amount determined under this
clause (ii) for any year with respect to all outstanding shares of Junior
Preferred Stock shall not exceed $2.5 million (the "Annual Cap"). In the event,
prior to the fifth anniversary, of (a) an optional redemption of any Notes or
Senior Discount Notes or (b) an optional prepayment of up to $25 million in
aggregate principal amount of the Tranche B Term Loan (any such redemption or
prepayment, a "Redemption Amount"), (1) the Base Amount shall be reduced by the
Redemption Amount and (2) the Annual Cap shall thereafter be equal to the
difference between (X) $2.5 million and (Y) an amount equal to $2.5 million
multiplied by a fraction, the numerator of which is the Redemption Amount and
the denominator of which is the Base Amount.
"Affiliate" of any specified Person means any other Person, directly or
indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any moving or storage company or contractor, or other
Person, that provides sales, packing, warehousing, hauling or other services in
connection with the ordinary course of business or operations of the Company or
any of its Subsidiaries, or any Affiliate of any such Agent.
"Agent Guarantee" means any Guarantee by the Company, NAVL or any
Restricted Subsidiary of Indebtedness or other obligations of any Agent.
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"all or substantially all" has the meaning given to such phrase in the
Revised Model Business Corporation Act and commentary thereto.
"Allied Acquisition" means the acquisition of Capital Stock and/or assets
of certain Subsidiaries of NFC engaged in moving services businesses pursuant to
the Acquisition Agreement dated as of September 14, 1999 between the Company and
NFC, and the other transactions contemplated thereby.
"Average Life" means, as of the date of determination, with respect to any
Indebtedness or Preferred Stock, the quotient obtained by dividing (i) the sum
of the products of the numbers of years from the date of determination to the
dates of each successive scheduled principal payment of such Indebtedness or
redemption or similar payment with respect to such Preferred Stock multiplied by
the amount of such payment by (ii) the sum of all such payments.
"Bank Indebtedness" means any and all amounts, whether outstanding on the
Issue Date or thereafter incurred, payable under or in respect of the Senior
Credit Facility, including without limitation principal, premium (if any),
interest (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company or any Restricted
Subsidiary whether or not a claim for post-filing interest is allowed in such
proceedings), fees, charges, expenses, reimbursement obligations, guarantees,
other monetary obligations of any nature and all other amounts payable
thereunder or in respect thereof.
"Board" means the Board of Directors of the Company or NAVL, or any
committee thereof duly authorized to act on behalf of such Board.
"Board of Directors" has the meaning specified in the first paragraph of
this Certificate of Designation.
"Borrowing Base" means 85% of accounts receivables of NAVL and its
Restricted Subsidiaries (determined in accordance with GAAP as of the end of the
most recently ended fiscal quarter for which consolidated financial statements
of NAVL are available).
"Business Day" means any day other than a Saturday, Sunday or other day on
which commercial banking institutions are authorized or required by law to close
in New York City.
"Capitalized Lease Obligation" means an obligation that is required to be
classified and accounted for as a capitalized lease for financial reporting
purposes in
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accordance with GAAP. The Stated Maturity of any Capitalized Lease Obligation
shall be the date of the last payment of rent or any other amount due under the
related lease.
"Capital Stock" of any Person means any and all shares, interests, rights
to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"CD&R" means Clayton, Dubilier & Rice, Inc.
"CD&R Fund" means Clayton, Dubilier & Rice Fund V Limited Partnership, a
Cayman Islands exempted limited partnership (together with any successor
investment vehicle managed by CD&R).
"Change of Control" means:
(A) a Change of Control Triggering Event (as defined in the Indentures) has
occurred and is continuing (without waiver under the respective
Indenture); and
(B) (1) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act), other than one or more Permitted Holders, is or becomes the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, of more than 50% of the total
voting power of the Voting Stock of the Company;
(2) the Company sells or transfers (in one or a series of related
transactions) all or substantially all of the assets of the Company and
its Restricted Subsidiaries to another Person (other than one or more
Permitted Holders or the Company or one or more Subsidiaries thereof); or
(3) during any period of two consecutive years (during which period the
Junior Preferred Stock shall have been outstanding), individuals who at
the beginning of such period were members of the Board of Directors
(together with any new members thereof whose election by the Board of
Directors or whose nomination for election by holders of Capital Stock of
the Company was approved by one or more Permitted Holders or by a vote of
a majority of the members of the Board of Directors then still in office
who were either members thereof at the beginning of such period or whose
election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors then in
office.
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"Change of Control Default" has the meaning specified in the definition of
"Mandatory Redemption Event" below.
"Change of Control Purchase Price" has the meaning specified in paragraph
(h)(i).
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission
"Common Stock" has the meaning specified in paragraph (b).
"Company" has the meaning specified in the first paragraph of this
Certificate of Designation.
"Consolidated Coverage Ratio" of the Company or NAVL, respectively, as of
any date of determination means the ratio of (i) the aggregate amount of
Consolidated EBITDA of such Parent for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such determination for
which consolidated financial statements of such Parent are available to (ii)
Consolidated Interest Expense of such Parent for such four fiscal quarters (in
each case, determined, for each fiscal quarter (or portion thereof) of the four
fiscal quarters ending prior to the Issue Date, on a pro forma basis to give
effect to the Allied Acquisition as if it had occurred at the beginning of such
four-quarter period); provided, that
(1) if since the beginning of such period, such Parent or any
Restricted Subsidiary of such Parent has Incurred any Indebtedness that
remains outstanding on such date of determination or if the transaction
giving rise to the need to calculate the Consolidated Coverage Ratio is an
Incurrence of Indebtedness, Consolidated EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving effect on a pro
forma basis to such Indebtedness as if such Indebtedness had been Incurred
on the first day of such period (except that in making such computation,
the amount of Indebtedness under any revolving credit facility outstanding
on the date of such calculation shall be computed based on (A) the average
daily balance of such Indebtedness during such four fiscal quarters or
such shorter period for which such facility was outstanding or (B) if such
facility was created after the end of such four fiscal quarters, the
average daily balance of such Indebtedness during the period from the date
of creation of such facility to the date of such calculation),
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(2) if since the beginning of such period, such Parent or any
Restricted Subsidiary of such Parent has repaid, repurchased, redeemed,
defeased or otherwise acquired, retired or discharged any Indebtedness
(each, a "Discharge") or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio involves a Discharge of
Indebtedness (in each case other than Indebtedness Incurred under any
revolving credit facility unless such Indebtedness has been permanently
repaid), Consolidated EBITDA and Consolidated Interest Expense for such
period shall be calculated after giving effect on a pro forma basis to
such Discharge of such Indebtedness, including with the proceeds of such
new Indebtedness, as if such Discharge had occurred on the first day of
such period,
(3) if since the beginning of such period, such Parent or any
Restricted Subsidiary of such Parent shall have disposed of any company,
any business or any group of assets constituting an operating unit of a
business (any such disposition, a "Sale"), the Consolidated EBITDA for
such period shall be reduced by an amount equal to the Consolidated EBITDA
(if positive) attributable to the assets that are the subject of such Sale
for such period or increased by an amount equal to the Consolidated EBITDA
(if negative) attributable thereto for such period and Consolidated
Interest Expense for such period shall be reduced by an amount equal to
(A) the Consolidated Interest Expense attributable to any Indebtedness of
such Parent or any Restricted Subsidiary of such Parent repaid,
repurchased, redeemed, defeased or otherwise acquired, retired or
discharged with respect to such Parent and its continuing Restricted
Subsidiaries in connection with such Sale for such period (including but
not limited to through the assumption of such Indebtedness by another
Person) plus (B) if the Capital Stock of any Restricted Subsidiary of such
Parent is sold, the Consolidated Interest Expense for such period
attributable to the Indebtedness of such Restricted Subsidiary to the
extent such Parent and its continuing Restricted Subsidiaries are no
longer liable for such Indebtedness after such Sale,
(4) if since the beginning of such period, such Parent or any
Restricted Subsidiary of such Parent (by merger, consolidation or
otherwise) shall have made an Investment in any Person that thereby
becomes a Restricted Subsidiary of such Parent, or otherwise acquired any
company, any business or any group of assets constituting an operating
unit of a business, including any such Investment or acquisition occurring
in connection with a transaction causing a calculation to be made
hereunder (any such Investment or acquisition, a "Purchase"), Consolidated
EBITDA and Consolidated Interest Expense for such period shall be
calculated after giving pro forma effect thereto (including the Incurrence
of any related Indebtedness) as if such Purchase occurred on the first day
of such period, and
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(5) if since the beginning of such period, any Person became a
Restricted Subsidiary of such Parent or was merged or consolidated with or
into of such Parent or any Restricted Subsidiary of such Parent, and since
the beginning of such period such Person shall have Discharged any
Indebtedness or made any Sale or Purchase that would have required an
adjustment pursuant to clause (2), (3) or (4) above if made by such Parent
or a Restricted Subsidiary of such Parent during such period, Consolidated
EBITDA and Consolidated Interest Expense for such period shall be
calculated after giving pro forma effect thereto as if such Discharge,
Sale or Purchase occurred on the first day of such period.
For purposes of this definition, whenever pro forma effect is to be given
to any Sale, Purchase or other transaction, or the amount of income or earnings
relating thereto and the amount of Consolidated Interest Expense associated with
any Indebtedness Incurred or repaid, repurchased, redeemed, defeased or
otherwise acquired, retired or discharged in connection therewith, the pro forma
calculations in respect thereof may include anticipated cost savings relating to
any such Sale, Purchase or other transaction that the Company or NAVL reasonably
believes in good faith could have been achieved during the relevant four quarter
period as a result of such Sale, Purchase or other transaction (provided that
both (i) such cost savings were identified and quantified in an Officer's
Certificate at the time of the consummation of such transaction and (ii) with
respect to each such transaction completed prior to the 90th day preceding the
relevant date of determination, actions were commenced or initiated by the
Company or NAVL within 90 days of the consummation of such transaction to effect
such cost savings identified in such Officer's Certificate and with respect to
any other transaction, such Officer's Certificate sets forth the specific steps
to be taken within the 90 days after the consummation of such transaction to
accomplish such cost savings). If any Indebtedness bears a floating rate of
interest and is being given pro forma effect, the interest expense on such
Indebtedness shall be calculated as if the rate in effect on the date of
determination had been the applicable rate for the entire period (taking into
account any Interest Rate Agreement applicable to such Indebtedness). If any
Indebtedness bears, at the option of the Company or a Restricted Subsidiary, a
rate of interest based on a prime or similar rate, a eurocurrency interbank
offered rate or other fixed or floating rate, and such Indebtedness is being
given pro forma effect, the interest expense on such Indebtedness shall be
calculated by applying such optional rate as the Company or such Restricted
Subsidiary may designate. If any Indebtedness that is being given pro forma
effect was Incurred under a revolving credit facility, the interest expense on
such Indebtedness shall be computed based upon the avenge daily balance of such
Indebtedness during the applicable period. Interest on a Capitalized Lease
Obligation shall be deemed to accrue at an interest rate determined in good
faith by a responsible financial or accounting officer of the Company or NAVL to
be the rate of interest implicit in such Capitalized Lease Obligation in
accordance with GAAP.
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"Consolidated EBITDA" of the Company or NAVL, respectively, means, for any
period, the Consolidated Net Income of such Parent for such period, plus the
following to the extent deducted in calculating such Consolidated Net Income:
(i) provision for all taxes (whether or not paid, estimated or accrued) based on
income, profits or capital, (ii) Consolidated Interest Expense, (iii)
depreciation, amortization (including but not limited to amortization of
goodwill and intangibles and amortization and write-off of financing costs) and
all other non-cash charges or non-cash losses, (iv) any expenses or charges
related to any Equity Offering, Investment or Indebtedness permitted by this
Certificate of Designation (whether or not consummated or incurred) and (v) the
amount of any minority interest expense. To the extent Consolidated EBITDA of
such Parent would otherwise include the amount of any Receivables Fees excluded
from Consolidated Interest Expense of such Parent pursuant to clause (iii) of
the definition of Consolidated Interest Expense, Consolidated EBITDA of such
Parent shall be reduced by such amount.
"Consolidated Interest Expense" of the Company or NAVL, respectively,
means, for any period, (i) the total interest expense of such Parent and its
Restricted Subsidiaries to the extent deducted in calculating Consolidated Net
Income of such Parent, net of any interest income of such Parent and its
Restricted Subsidiaries, including without limitation any such interest expense
consisting of (a) interest expense attributable to Capitalized Lease
Obligations, (b) amortization of debt discount, (c) interest in respect of
Indebtedness of any other Person that has been Guaranteed by such Parent or any
Restricted Subsidiary of such Parent (other than Indebtedness Guaranteed under
any Management Guarantee or Agent Guarantee, except to the extent the interest
thereon is actually being paid by such Parent or a Restricted Subsidiary
thereof, (d) non-cash interest expense, (e) the interest portion of any deferred
payment obligation, and (f) commissions, discounts and other fees and charges
owed with respect to letters of credit and bankers' acceptance financing, plus
(ii) dividends paid in cash in respect of Disqualified Stock of such Parent or a
Restricted Subsidiary of such Parent or in respect of Preferred Stock of a
Restricted Subsidiary of such Parent and minus (iii) to the extent otherwise
included in such interest expense referred to in clause (i) above, Receivables
Fees and amortization or write-off of financing costs, in each case under
clauses (i) through (iii) as determined on a Consolidated basis in accordance
with GAAP; provided, that gross interest expense shall be determined alter
giving effect to any net payments made or received by such Parent and its
Restricted Subsidiaries with respect to Interest Rate Agreements.
"Consolidated Net Income" of the Company or NAVL, respectively, means, for
any period, the net income (loss) of such Parent and its Restricted
Subsidiaries, determined on a consolidated basis in accordance with GAAP and
before any reduction in respect of Preferred Stock dividends (including
dividends in respect of any Junior
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Preferred Stock); provided, that there shall not be included in such
Consolidated Net Income:
(i) any net income (loss) of any Person if such Person is not a
Restricted Subsidiary of such Parent, except that (A) subject to the
limitations contained in clause (iv) below, such Parent's equity in the
net income of any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount actually distributed by
such Person during such period to such Parent or a Restricted Subsidiary
of such Parent as a dividend or other distribution (subject, in the case
of a dividend or other distribution to a Restricted Subsidiary of such
Parent, to the limitations contained in clause (iii) below) and (B) such
Parent's equity in the net loss of such Person shall be included to the
extent of the aggregate Investment of such Parent or any of its Restricted
Subsidiaries in such Person,
(ii) any net income (loss) of any Person acquired by such Parent or
a Restricted Subsidiary of such Parent in a pooling of interests
transaction for any period prior to the date of such acquisition,
(iii) any net income (loss) of any Restricted Subsidiary of NAVL if
such Restricted Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of similar
distributions by such Restricted Subsidiary, directly or indirectly, to
NAVL by operation of the terms of such Restricted Subsidiary's charter or
any agreement, instrument, judgment, decree, order, statute or
governmental rule or regulation applicable to such Restricted Subsidiary
or its stockholders (other than (x) restrictions that have been waived or
otherwise released, (y) restrictions pursuant to this Certificate of
Designation, the Notes, the Senior Discount Notes or any Indenture and (z)
restrictions in effect on the Issue Date with respect to a Restricted
Subsidiary and other restrictions with respect to such Restricted
Subsidiary that taken as a whole are not materially less favorable to the
Noteholders than such restrictions in effect on the Issue Date), except
that (A) subject to the limitations contained in clause (iv) below, NAVL's
equity in the net income of any such Restricted Subsidiary for such period
shall be included in such Consolidated Net Income up to the aggregate
amount of any dividend or distribution that was or that could have been
made by such Restricted Subsidiary during such period to NAVL or another
Restricted Subsidiary of NAVL (subject, in the case of a dividend that
could have been made to another Restricted Subsidiary of NAVL, to the
limitation contained in this clause) and (B) the net loss of such
Restricted Subsidiary shall be included to the extent of the aggregate
Investment of NAVL or any of its other Restricted Subsidiaries in such
Restricted Subsidiary,
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(iv) any gain or loss realized upon the sale or other disposition of
any asset of such Parent or any Restricted Subsidiary of such Parent
(including pursuant to any sale/leaseback transaction) that is not sold or
otherwise disposed of in the ordinary course of business (as determined in
good faith by the Board),
(v) any item classified as an extraordinary, unusual or nonrecurring
gain, loss or charge (including without limitation (a) any compensation
expense for stock options that will be cashed out, converted, exchanged or
otherwise retired in connection with the Allied Acquisition, (b) any
charge or expense incurred for employee bonuses in connection with the
Allied Acquisition, and (c) fees, expenses and charges associated with the
Allied Acquisition or any acquisition, merger or consolidation after the
Issue Date),
(vi) the cumulative effect of a change in accounting principles,
(vii) all deferred financing costs written off and premiums paid in
connection with any early extinguishment of Indebtedness,
(viii) any unrealized gains or losses in respect of Currency
Agreements,
(ix) any unrealized foreign currency transaction gains or losses in
respect of Indebtedness of any Person denominated in a currency other than
the functional currency of such Person, and
(x) any non-cash compensation charge arising from any grant of
stock, stock options or other equity based awards.
In the case of any unusual or nonrecurring gain, loss or charge not
included in Consolidated Net Income pursuant to clause (v) above in any
determination thereof, the Company or NAVL will prepare an Officer's Certificate
promptly after the date on which Consolidated Net Income is so determined,
setting forth the nature and amount of such unusual or nonrecurring gain, loss
or charge.
"Consolidated Tangible Assets" means, as of any date of determination, the
total assets less the total intangible assets (including, without limitation,
goodwill) shown on the consolidated balance sheet of NAVL and its Restricted
Subsidiaries as of the most recent date for which such a balance sheet is
available, determined on a consolidated basis in accordance with GAAP (and, in
the case of any determination relating to any Incurrence of Indebtedness, on a
pro forma basis including any property or assets being acquired in connection
therewith).
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"Consolidation" means for the Company or NAVL, respectively, the
consolidation of the accounts of each of the Restricted Subsidiaries of such
Parent with those of such Parent in accordance with GAAP; provided that
"Consolidation" will not include consolidation of the accounts of any
Unrestricted Subsidiary of such Parent, but the interest of such Parent or any
Restricted Subsidiary of such Parent in any Unrestricted Subsidiary of such
Parent will be accounted for as an investment. The term "Consolidated" has a
correlative meaning.
"Conversion Date" has the meaning specified in paragraph (1)(i)(D)(3).
"Conversion Event" has the meaning specified in paragraph (1)(i)(D)(1).
"Conversion Notice" has the meaning specified in paragraph (1)(i)(D)(1).
"Credit Facilities" means, one or more of (x) the Senior Credit Facility
and (y) other facilities or arrangements, in each case with one or more banks or
other institutions providing for revolving credit loans, term loans, receivables
financings (including without limitation through the sale of receivables to such
institutions or to special purpose entities formed to borrow from such
institutions against such receivables), letters of credit or other Indebtedness,
in each case, including all agreements, instruments and documents executed and
delivered pursuant to or in connection with any of the foregoing, in each case
as the same may be amended, supplemented, waived or otherwise modified from time
to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time (whether in whole or in part, whether
with the original banks or other institutions or other banks or other
institutions or otherwise, and whether provided under any original Credit
Facility or one or more other credit agreements, indentures, financing
agreements or other Credit Facilities or otherwise). Without limiting the
generality of the foregoing, the term "Credit Facility" shall include any
agreement (i) changing the maturity of any Indebtedness incurred thereunder or
contemplated thereby, (ii) adding Subsidiaries of the Company as additional
borrowers or guarantors thereunder, (iii) increasing the amount of Indebtedness
incurred thereunder or available to be borrowed thereunder or (iv) otherwise
altering the terms and conditions thereof.
"Currency Agreement" means, in respect of a Person, any foreign exchange
contract, currency swap agreement or other similar agreement or arrangements
(including derivative agreements or arrangements), as to which such Person is a
party or a beneficiary.
"Debt Agreements" means the Senior Credit Facility, the Indentures, the
Notes and the Senior Discount Notes, and any refinancing thereof, provided that
any agreement
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governing any such refinancing shall not be a Debt Agreement to the extent that
it imposes greater restrictions on the payment of cash dividends on, or the
mandatory redemption or purchase of, the Junior Preferred Stock than the Debt
Agreement thereby refinanced.
"Default Amount" means (i) $0 for any date during the period beginning on
the Issue Date and ending on the date before the first Dividend Payment Date
falling on or after the 63-month anniversary of the Issue Date and (ii) as of
any other date, the lesser of (A) the aggregate amount of dividends actually
permitted under the Debt Agreements to have been declared and paid by the
Company on the Junior Preferred Stock on each Dividend Payment Date that occurs
during the period beginning on the first Dividend Payment Date falling on or
after the 63-month anniversary of the Issue Date and ending on such date, (B)
the aggregate amount of dividends actually permitted under the Debt Agreements
to have been declared and paid by NAVL to the Company on each such Dividend
Payment Date for the purpose of paying dividends on the Junior Preferred Stock
on such respective Dividend Payment Date and (C) the sum of the Minimum Amounts
applicable to each Dividend Payment Date that occurs during the period beginning
on the first Dividend Payment Date falling on or after the 63-month anniversary
of the Issue Date and ending on such date.
"Default Rate" means a quarterly rate equal to (i) 1.50% in the case of
each Dividend Payment Date occurring during the one-year period beginning on the
first Dividend Payment Date falling on or after the 63-month anniversary of the
Issue Date and (ii) 1.75% in the case of each Dividend Payment Date falling on
or after the 75-month anniversary of the Issue Date.
"Disqualified Stock" means, with respect to any Person, any Capital Stock
(other than Management Stock) that by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable or exercisable) or
upon the happening of any event (i) matures or is mandatorily redeemable
pursuant to a sinking fund obligation or otherwise, (ii) is convertible or
exchangeable for Indebtedness or Disqualified Stock or (iii) is redeemable at
the option of the holder thereof, in whole or in part, in each case on or prior
to the 91st day following the final Stated Maturity of the Notes.
Notwithstanding the preceding sentence, (a) any Capital Stock that would
constitute Disqualified Stock solely because the holders thereof have the right
to require the Company or NAVL to repurchase such Capital Stock upon the
occurrence of an event described therein as a change of control or an asset sale
shall not constitute Disqualified Stock if the terms of such Capital Stock
provide that the Company or NAVL may not repurchase or redeem any such Capital
Stock pursuant to such provisions unless such repurchase or redemption complies
with paragraph (1)(ii) above, (b) any Capital Stock that would constitute
Disqualified Stock solely because such Capital Stock is issued pursuant to any
plan for the benefit of employees and may be required to be repurchased by the
Company or NAVL in
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order to satisfy applicable regulatory obligations shall not constitute
Disqualified Stock and (c) the Junior Preferred Stock shall not constitute
Disqualified Stock.
"Dividend Default" means the failure of the Company to have declared and
paid dividends on the Junior Preferred Stock as of any date (other than any date
as of which the Default Amount is $0) in an amount at least equal to the Default
Amount as of such date.
"Dividend Payment Date" means March 15, June 15, September 15 and December
15 of each year.
"Dividend Period" means the Initial Dividend Period and, thereafter, each
Quarterly Dividend Period.
"Domestic Subsidiary" of the Company or NAVL, respectively, means any
Restricted Subsidiary of such Parent other than a Foreign Subsidiary of such
Parent.
"Equity Offering" means a sale of Capital Stock (other than Disqualified
Stock) of the Company or NAVL (x) that is a sale of Capital Stock of the Company
or NAVL or (y) proceeds of which are contributed to the Company or any of its
Restricted Subsidiaries.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Date" has the meaning specified in paragraph (g)(i)(A).
"Exchange Debentures" means the Subordinated Exchange Debentures of the
Company due 2010 and any Exchange Debentures issued as payment in kind interest
thereon.
"Exchange Notice" has the meaning specified in paragraph (g)(i)(A).
"Financing Disposition" means any sale, transfer, conveyance or other
disposition of property or assets by the Company or any Subsidiary thereof to
any Receivables Entity, or by any Receivables Subsidiary, in each case in
connection with the Incurrence by a Receivables Entity of Indebtedness, or
obligations to make payments to the obligor on Indebtedness, which may be
secured by a Lien in respect of such property or assets.
"Foreign Subsidiary" of the Company or NAVL, respectively, means (a) any
Restricted Subsidiary of such Parent that is not organized under the laws of the
United States of America or any state thereof or the District of Columbia and
(b) any Restricted Subsidiary of such Parent that has no material assets other
than securities of one or more
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Foreign Subsidiaries, and other assets relating to an ownership interest in any
such securities or Subsidiaries.
"Foreign Subsidiary Coverage Ratio" of the Company or NAVL, respectively,
as of any date of determination means the ratio of (i) the combined portion
attributable to Foreign Subsidiaries of such Parent, taken as a whole, of the
aggregate amount of Consolidated EBITDA of such Parent for the period of the
most recent four consecutive fiscal quarters ending prior to the date of such
determination for which consolidated financial statements of such Parent are
available to (ii) the combined portion attributable to Foreign Subsidiaries of
such Parent, taken as a whole, of Consolidated Interest Expense of such Parent
for such four fiscal quarters, all calculated after giving effect to all
intercompany eliminations applied in preparing the relevant consolidated
financial statements of such Parent (and without giving effect to clause (iii)
of the definition of the term Consolidated Net Income as it relates to
restrictions on the payment of dividends or the making of similar distributions
by any Foreign Subsidiary to NAVL or any Domestic Subsidiary of NAVL, but giving
effect to such clause as it relates to any such restrictions on the payment of
dividends or the making of similar distributions by any Foreign Subsidiary of
NAVL to another Foreign Subsidiary of NAVL), and otherwise in accordance with
the definition of the term "Coverage Ratio" (including but not limited to in
accordance with all pro forma and other adjustments provided for in such
definition).
"GAAP" means generally accepted accounting principles in the United States
of America as in effect on the Issue Date (for purposes of the definitions of
the terms "Consolidated Coverage Ratio," "Foreign Subsidiary Coverage Ratio,"
"Consolidated EBITDA," "Consolidated Interest Expense," "Consolidated Net
Income" and "Consolidated Tangible Assets," all defined terms in this
Certificate of Designation to the extent used in or relating to any of the
foregoing definitions, and all ratios and computations based on any of the
foregoing definitions) and as in effect from time to time (for all other
purposes under this Certificate of Designation), including those set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession. All ratios and computations based on GAAP contained in
this Certificate of Designation shall be computed in conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of any Person
directly or indirectly guaranteeing any Indebtedness or other obligation of any
other Person; provided that the term "Guarantee" shall not include endorsements
for collection or deposit in the ordinary course of business. The term
"Guarantee" used as a verb has a corresponding meaning.
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"Hedging Obligations" of any Person means the obligations of such Person
pursuant to any Interest Rate Agreement or Currency Agreement.
"Holder" means a holder of shares of Junior Preferred Stock in whose name
the certificate representing such shares is registered in the stock register of
the Company.
"Holding Expenses" means (i) costs (including all professional fees and
expenses) incurred by the Company to comply with its reporting obligations under
federal or state laws or under any Indenture, including any reports filed with
respect to the Securities Act, Exchange Act or the respective rules and
regulations promulgated thereunder, (ii) indemnification obligations of the
Company owing to directors, officers, employees or other Persons under its
charter or by-laws or pursuant to written agreements with any such Person, (iii)
fees and expenses payable by the Company in connection with the Transactions,
(iv) other operational expenses of the Company incurred in the ordinary course
of business, and (v) expenses incurred by the Company in connection with any
public offering of Capital Stock or Indebtedness.
"Incur" means issue, assume, enter into any Guarantee of, incur or
otherwise become liable for; provided, however, that any Indebtedness or Capital
Stock of a Person existing at the time such Person becomes a Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be
Incurred by such Subsidiary at the time it becomes a Subsidiary. Accrual of
interest, the accretion of accreted value and the payment of interest in the
form of additional Indebtedness will not be deemed to be an Incurrence of
Indebtedness. Any Indebtedness issued at a discount (including Indebtedness on
which interest is payable through the issuance of additional Indebtedness) shall
be deemed Incurred at the time of original issuance of the Indebtedness at the
initial accreted amount thereof.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication):
(i) the principal of indebtedness of such Person for borrowed money,
(ii) the principal of obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments,
(iii) all reimbursement obligations of such Person in respect of letters
of credit or other similar instruments (the amount of such
obligations being equal at any time to the aggregate then undrawn
and unexpired amount of such letters of credit or other instruments
plus the aggregate amount of drawings thereunder that have not then
been reimbursed),
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(iv) all obligations of such Person to pay the deferred and unpaid
purchase price of property (except Trade Payables), which purchase
price is due more than one year after the date of placing such
property in final service or taking final delivery and title
thereto,
(v) all Capitalized Lease Obligations of such Person,
(vi) the redemption, repayment or other repurchase amount of such Person
with respect to any Disqualified Stock of such Person or (if such
Person is a Subsidiary of NAVL other than a Note Guarantor) any
Preferred Stock of such Subsidiary, but excluding, in each case, any
accrued dividends (the amount of such obligation to be equal at any
time to the maximum fixed involuntary redemption, repayment or
repurchase price for such Capital Stock, or if less (or if such
Capital Stock has no such fixed price), to the involuntary
redemption, repayment or repurchase price therefor calculated in
accordance with the terms thereof as if then redeemed, repaid or
repurchased, and if such price is based upon or measured by the fair
market value of such Capital Stock, such fair market value shall be
as determined in good faith by the Board or the board of directors
or other governing body of the issuer of such Capital Stock),
(vii) all Indebtedness of other Persons secured by a Lien on any asset of
such Person, whether or not such Indebtedness is assumed by such
Person; provided that the amount of Indebtedness of such Person
shall be the lesser of (A) the fair market value of such asset at
such date of determination (as determined good faith by the Company)
and (B) the amount of such Indebtedness of such other Persons,
(viii) Guarantees of all Indebtedness of other Persons to the extent so
Guaranteed by such Person, and
(ix) to the extent not otherwise included in this definition, net Hedging
Obligations of such Person (the amount of any such obligation to be
equal at any time to the termination value of such agreement or
arrangement giving rise to such Hedging Obligation that would be
payable by such Person at such time).
The amount of Indebtedness of any Person at any date shall be determined
as set forth above or otherwise provided in paragraph (1), or otherwise shall
equal the amount thereof that would appear on a balance sheet of such Person
(excluding any notes thereto)
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prepared in accordance with GAAP. The Junior Preferred Stock shall not
constitute Indebtedness.
"Indentures" mean the Note Indenture, the Senior Discount Note Indenture
and the Senior Discount Loan Agreement.
"Initial Dividend Period" means the dividend period commencing on the
Issue Date and ending on the day before the first Dividend Payment Date to occur
thereafter.
"Interest Rate Agreement" means, with respect to any Person, any interest
rate protection agreement, interest rate future agreement, interest rate option
agreement, interest rate swap agreement, interest rate cap agreement, interest
rate collar agreement, interest rate hedge agreement or other similar agreement
or arrangement (including derivative agreements or arrangements), as to which
such Person is party or a beneficiary.
"Interim Loan Facility" means the loan agreement dated as of the Issue
Date among the Company, The Chase Manhattan Bank and Bank of America (or
affiliates of such institutions), together with any notes, guarantees, pledge
agreements, security agreements, other collateral documents, and other
agreements, instruments and documents, executed and delivered pursuant to or in
connection with any of the foregoing, in each case as the same may be amended,
supplemented, waived or otherwise modified from time to time.
"Inventory" means goods held for sale or lease by a Person in the ordinary
course of business, net of any reserve for goods that have been segregated by
such Person to be returned to the applicable vendor for credit, as determined in
accordance with GAAP.
"Investment" in any Person by any other Person means any direct or
indirect advance, loan or other extension of credit (other than to customers,
suppliers, Agents, directors, officers or employees of any Person in the
ordinary course of business) or capital contribution (by means of any transfer
of cash or other property to others or any payment for property or services for
the account or use of others) to, or any purchase or acquisition of Capital
Stock, Indebtedness or other similar instruments issued by, such Person. A
Guarantee shall not be deemed to be or give rise to an Investment until such
Guarantee is funded (in whole or in part). The amount of any Investment
outstanding at any time shall be the original cost of such Investment, reduced
(at the Company's option) by any dividend, distribution, interest payment,
return of capital, repayment or other amount or value received in respect of
such Investment.
"Issue Date" means the date on which the Junior Preferred Stock is
originally issued by the Company under this Certificate of Designation.
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"Junior Payment" has the meaning specified in paragraph (1)(ii)(A).
"Junior Preferred Stock" has the meaning specified in paragraph (a).
"Junior Securities" has the meaning specified in paragraph (b)(i).
"Lien" means any mortgage, pledge, security interest, encumbrance, lien or
charge of any kind (including any conditional sale or other title retention
agreement or lease in the nature thereof).
"Liquidation Preference" has the meaning specified in paragraph (a).
"Management Advances" means (1) loans or advances made to directors,
officers or employees of the Company or any Restricted Subsidiary (x) in respect
of travel, entertainment or moving-related expenses incurred in the ordinary
course of business, (y) in respect of moving-related expenses incurred in
connection with any closing or consolidation of any facility, or (z) in the
ordinary course of business and (in the case of this clause (z)) not exceeding
$2.5 million in the aggregate outstanding at any time, (2) promissory notes of
Management Investors acquired in connection with the issuance of Management
Stock to such Management Investors, (3) loans to Management Investors of funds
applied to purchase Management Stock in an aggregate principal amount not
exceeding $10.0 million outstanding at any time (less the aggregate principal
amount of then outstanding borrowings by Management Investors then guaranteed by
the Company or NAVL pursuant to clause (x) of the definition of Management
Guarantees), (4) Management Guarantees, or (5) other Guarantees of borrowings by
Management Investors in connection with the purchase of Management Stock, which
Guarantees are permitted under paragraph (1)(iii).
"Management Agreements" means, collectively, the Consulting Agreement,
dated as of March 30, 1998, among the Company, NAVL and CD&R (and, in each case,
its respective permitted successors and assigns thereunder) and the
Indemnification Agreement, dated as of March 30, 1998, among the Company, NAVL,
CD&R and Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands
exempted limited Partnership (and, in each case, its respective permitted
successors and assigns), as each may be amended, supplemented, waived or
otherwise modified from time to time in accordance with the terms thereof.
"Management Guarantees" means guarantees (x) of up to an aggregate
principal amount of $10.0 million of borrowings by Management Investors in
connection with their purchase of Management Stock outstanding at any time (less
the aggregate principal amount of then outstanding loans made to Management
Investors by the Company or
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NAVL pursuant to clause (3) of the definition of Management Advances) or (y)
made on behalf of or in respect of loans or advances made to, directors,
officers or employees of the Company or any Restricted Subsidiary (1) in respect
of travel, entertainment and moving-related expenses incurred in the ordinary
course of business, or (2) in the ordinary course of business and (in the case
of this clause (2)) not exceeding $2.5 million in the aggregate outstanding at
any time.
"Management Investors" means the officers, directors, employees and other
members of the management of the Company, NAVL or any of their respective
Subsidiaries (or of any Agent), or family members or relatives thereof or trusts
or partnerships for the benefit of any of the foregoing, or any of their heirs,
executors, successors and legal representatives, or any Agent, who at any date
beneficially own or have the right to acquire, directly or indirectly, Capital
Stock of the Company or NAVL.
"Management Stock" means Capital Stock of the Company or NAVL (including
any options, warrants or other rights in respect thereof) held by any of the
Management Investors.
"Mandatory Redemption Event" has occurred if (1) there is a Dividend
Default for four consecutive quarterly periods; (2) the Company is permitted by
the Debt Agreements but fails to discharge any redemption obligation of the
Junior Preferred Stock when required, and NAVL is permitted by the Debt
Agreements to dividend sufficient funds to the Company for such purpose; (3) the
Company is permitted by the Debt Agreements but fails to make an Offer to
purchase all outstanding shares of Junior Preferred Stock following a Change of
Control if such Offer to purchase is required to be made pursuant to paragraph
(h) hereof or fails to purchase shares of Junior Preferred Stock when required
from Holders who elect to have such shares purchased pursuant to such Offer (a
"Change of Control Default"), and in each case NAVL is permitted by the Debt
Agreements to dividend sufficient funds to the Company for the purpose of
purchasing all such outstanding shares or all such shares of electing Holders,
as the case may be; or (4) the Company breaches or violates one of the
provisions set forth in paragraph (1) hereof and the breach or violation
continues for a period of 60 days or more after the Company receives notice
thereof specifying the default from the Holders of at least 25% of the shares of
Junior Preferred Stock then outstanding and there has been an acceleration of
the maturity of the outstanding indebtedness under any Debt Agreements.
"Mandatory Redemption Price" has the meaning specified in paragraph
(e)(ii).
"Minimum Amount" means, with respect to any Dividend Payment Date, an
amount equal to the product of the Default Rate with respect to such date and
the aggregate Stated Amounts as of such date of each share of Junior Preferred
Stock.
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"Moody's" means Moody's Investors Service, Inc., and its successors.
"NAVL" means North American Van Lines, Inc., a Delaware corporation, and
any successor thereto.
"Net Cash Proceeds," with respect to any issuance or sale of any
securities of the Company or any Subsidiary by the Company or any Subsidiary, or
any capital contribution, means the cash proceeds of such issuance, sale or
contribution net of attorneys' fees, accountants' fees, underwriters' or
placement agents' fees, discounts or commissions and brokerage, consultant and
other fees actually incurred in connection with such issuance, sale or
contribution and net of taxes paid or payable as a result thereof.
"NFC" means NFC plc, a company organized under the laws of England and
Wales.
"Note Guarantor" means any Restricted Subsidiary that enters into a
Guarantee of any Notes.
"Noteholder" means the Person in whose name a Note is registered in the
applicable Note register of the Company.
"Notes" means the 13 3/8% Senior Subordinated Notes of NAVL due 2009
issued under the Note Indenture, in an aggregate principal amount of $150.0
million, any Exchange Notes (as defined in the Note Indenture) and any
Additional Notes.
"Note Indenture" means the Indenture, dated as of the Issue Date, between
NAVL and State Street Bank and Trust Company, as Trustee, pursuant to which
Notes are issued, as such Indenture may be amended, supplemented, waived or
otherwise modified from time to time, or refunded, refinanced, restructured,
replaced, renewed, repaid, increased or extended from time to time (whether in
whole or in part, and whether provided under the original Note Indenture or one
or more other credit agreements, indentures or financing agreements or
otherwise).
"Offer" has the meaning specified in paragraph (h)(i).
"Officer" means, with respect to the Company or NAVL, the Chairman of the
Board, the President, the Chief Executive Officer, the Chief Financial Officer,
any Vice President, the Controller, the Treasurer or the Secretary (a) of such
Person or (b) if such Person is owned or managed by a single entity, of such
entity (or any other individual designated as an "Officer" for the purposes of
this Certificate of Designation by the Board).
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"Officer's Certificate" means a certificate signed by one Officer of the
Company or NAVL.
"Opinion of Counsel" means a written opinion from Debevoise & Plimpton, or
other legal counsel who is reasonably acceptable to the Holders of a majority of
the outstanding shares of the Junior Preferred Stock. The counsel may be an
employee of or counsel to the Company or NAVL.
"Optional Redemption Price" has the meaning specified in paragraph
(e)(i)(A).
"Parent" means the Company or NAVL, as the case may be.
"Parity Securities" has the meaning specified in paragraph (b)(ii).
"Permitted Holder" means any of the following: (i) any of CD&R Fund, the
Management Investors, CD&R and their respective Affiliates; (ii) any investment
fund or vehicle managed, sponsored or advised by CD&R and (iii) any Person
acting in the capacity of an underwriter in connection with a public or private
offering of Capital Stock of the Company or NAVL.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock" as applied to the Capital Stock of any corporation means
Capital Stock of any class or classes (however designated) that is preferred as
to the payment of dividends, or as to the distribution of assets upon any
voluntary or involuntary liquidation or dissolution of such corporation, over
shares of Capital Stock of any other class of such corporation.
"Public Offering" any underwritten public offering of Common Stock led by
one or more underwriters at least one of which is of nationally recognized
standing pursuant to an effective registration statement under the Securities
Act.
"Purchase Date" with respect to any shares of Junior Preferred Stock,
means the date on which such shares of Junior Preferred Stock are purchased by
the Company as contemplated by paragraph (h) above.
"Purchase Money Obligations" means any Indebtedness Incurred to finance or
refinance the acquisition, leasing, construction or improvement of property
(real or
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personal) or assets, and whether acquired through the direct acquisition of such
property or assets or the acquisition of the Capital Stock of any Person owning
such property or assets, or otherwise.
"Purchase Notice" has the meaning specified in paragraph (h)(i).
"QIB" or "Qualified Institutional Buyer" means a "qualified institutional
buyer," as that term is defined in Rule 144A under the Securities Act of 1933,
as amended.
"Quarterly Dividend Period" shall mean the quarterly period commencing on
each March 15, June 15, September 15 and December 15 and ending on the day
before the following Dividend Payment Date.
"Qualified Proceeds" means property or assets that are used, usable or
useful in, or a majority of the Voting Stock of any Person engaged in, a Related
Business; provided that the fair market value of any such assets or Capital
Stock shall be determined by the Board in good faith.
"Receivable" means a right to receive payment arising from a sale or lease
of goods or services by a Person pursuant to an arrangement with another Person
pursuant to which such other Person is obligated to pay for goods or services
under terms that permit the purchase of such goods and services on credit, as
determined in accordance with GAAP.
"Receivables Entity" means (x) any Receivables Subsidiary or (vi) any
other Person that is engaged in the business of acquiring, selling, collecting,
financing or refinancing Receivables, accounts (as defined in the Uniform
Commercial Code as in effect in any jurisdiction from time to time), other
accounts and/or other receivables, and/or related assets.
"Receivables Fees" means distributions or payments made directly or by
means of discounts with respect to any participation interest issued or sold in
connection with, and other fees paid to a Person that is not a Restricted
Subsidiary of NAVL in connection with, any Receivables Financing.
"Receivables Financing" means any financing of Receivables of the Company
or any Restricted Subsidiary that have been transferred to a Receivables Entity
in a Financing Disposition.
"Receivables Subsidiary" means a Subsidiary of the Company that (a) is
engaged solely in the business of acquiring, selling, collecting, financing or
refinancing Receivables,
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accounts (as defined in the Uniform Commercial Code as in effect in any
jurisdiction from time to time) and other accounts and receivables (including
any thereof constituting or evidenced by chattel paper, instruments or general
intangibles), all proceeds thereof and all rights (contractual and other),
collateral and other assets relating thereto, and any business or activities
incidental or related to such business, and (b) is designated as a "Receivables
Subsidiary" by the Board.
"Receivables Repurchase Obligation" means any obligation of a seller of
receivables to repurchase receivables (including Receivables, accounts (as
defined in the Uniform Commercial Code as in effect in any jurisdiction from
time to time) and other accounts and receivables (including any thereof
constituting or evidenced by chattel paper, instruments or general intangibles))
arising as a result of a breach of a representation, warranty or covenant or
otherwise, including as a result of a receivable or portion thereof becoming
subject to any asserted defense, dispute, off-set or counterclaim of any kind as
a result of any action taken by, any failure to take action by or any other
event relating to the seller.
"Redemption Date" with respect to any shares of Junior Preferred Stock,
means the date on which such shares of Junior Preferred Stock are redeemed by
the Company.
"Redemption Notice" has the meaning specified in paragraph (e)(iii).
"refinance" means refinance, refund, replace, renew, repay, modify,
restate, defer, substitute, supplement, reissue, resell or extend (including
pursuant to any defeasance or discharge mechanism); and the terms "refinances,"
"refinanced" and "refinancing" as used for any purpose in this Certificate of
Designation shall have a correlative meaning.
"Refinancing Indebtedness" means Indebtedness that is Incurred to
refinance any Indebtedness existing on the Issue Date or Incurred in compliance
with this Certificate of Designation (including Indebtedness of the Company that
refinances Indebtedness of any Restricted Subsidiary (to the extent permitted in
this Certificate of Designation) and Indebtedness of any Restricted Subsidiary
that refinances Indebtedness of another Restricted Subsidiary) including
Indebtedness that refinances Refinancing Indebtedness; provided, that (1) if;
the Indebtedness being refinanced is Junior Securities, the Refinancing
Indebtedness has an Average Life at the time such Refinancing Indebtedness is
Incurred that is equal to or greater than the Average Life of the Indebtedness
being refinanced, (2) such Refinancing Indebtedness is Incurred in an aggregate
principal amount (or if issued with original issue discount, an aggregate issue
price) that is equal to or less than the sum of (x) the aggregate principal
amount (or if issued with original issue discount, the aggregate accreted value)
then outstanding of the Indebtedness being refinanced, plus (y) fees,
underwriting discounts, premiums and other costs and expenses
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incurred in connection with such Refinancing Indebtedness and (3) Refinancing
Indebtedness shall not include Indebtedness of the Company or a Restricted
Subsidiary that refinances Indebtedness of an Unrestricted Subsidiary.
"Related Business" means those businesses in which the Company or any of
its Subsidiaries is engaged on the Issue Date, or that are related,
complementary, incidental or ancillary thereto or extensions, developments or
expansions thereof.
"Resolution" has the meaning specified in the recitals.
"Restricted Subsidiary" means any Subsidiary of the Company (or in the
case of NAVL, of NAVL) other than an Unrestricted Subsidiary of such Parent.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Credit Agreement" means the credit agreement dated as of the Issue
Date, 1999, among NAVL, any other Subsidiaries of the Company party thereto from
time to time, the banks and other financial institutions party thereto from time
to time, Banc of America Securities LLC, as syndication agent, and The Chase
Manhattan Bank as collateral agent and administrative agent, as such agreement
may be assumed by any successor in interest, and as such agreement may be
amended, supplemented, waived or otherwise modified from time to time, or
refunded, refinanced, restructured, replaced, renewed, repaid, increased or
extended from time to time (whether in whole or in part, whether with the
original agent and lenders or other agents and lenders or otherwise, and whether
provided under the original Senior Credit Agreement or otherwise).
"Senior Credit Facility" means the collective reference to the Senior
Credit Agreement, any Loan Documents (as defined therein), any notes and letters
of credit issued pursuant thereto and any guarantee and collateral agreement,
patent and trademark security agreement, mortgages, letter of credit
applications and other guarantees, pledge agreements, security agreements and
collateral documents, and other instruments and documents, executed and
delivered pursuant to or in connection with any of the foregoing, in each case
as the same may be amended, supplemented, waived or otherwise modified from time
to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time (whether in whole or in part, whether
with the original agent and lenders or other agents and lenders or otherwise,
and whether provided under the original Senior Credit Agreement or one or more
other credit agreements, indentures (including the Indenture) or financing
agreements or otherwise). Without limiting the generality of the foregoing, the
term "Senior Credit Facility" shall include any agreement (i) changing the
maturity of any Indebtedness incurred thereunder or contemplated thereby, (ii)
adding Subsidiaries of the Company as additional borrowers or
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guarantors thereunder, (iii) increasing the amount of Indebtedness incurred
thereunder or available to be borrowed thereunder or (iv) otherwise altering the
terms and conditions thereof.
"Senior Discount Notes" means (1) the Indebtedness of the Company under
the Senior Discount Loan Agreement, with an initial accreted value of $35.0
million in the aggregate, and (2) the 16% Senior Discount Notes of the Company
due 2009 issued or to be issued under the Senior Discount Note Indenture, in
exchange or substitution for Indebtedness under the Senior Discount Loan
Agreement, together with any Exchange Notes (as defined in the Senior Discount
Note Indenture) and any Additional Notes.
"Senior Discount Loan Agreement" means the Loan Agreement, dated as of the
Issue Date, among the Company and Blue Ridge Investments, LLC and The Chase
Manhattan Bank, N.A. as initial Lenders thereunder, as such Loan Agreement may
be amended, supplemented, waived or otherwise modified from time to time, or
refunded, refinanced, restructured, replaced, renewed, repaid, increased or
extended from time to time (whether in whole or in part, and whether provided
under the original Loan Agreement or one or more other credit agreements,
indentures or financing agreements or otherwise).
"Senior Discount Note Indenture" means the Indenture between the Company
and the relevant Trustee, pursuant to which Senior Discount Notes are issued, as
such Indenture may be amended, supplemented, waived or otherwise modified from
time to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time (whether in whole or in part, and
whether provided under the original Senior Discount Note Indenture or one or
more other credit agreements, indentures or financing agreements or otherwise).
"Senior Securities" has the meaning specified in paragraph (b)(iii).
"S&P" means Standard & Poor's Ratings Service, a division of The
McGraw-Hill Companies, Inc., and its successors.
"Special Redemption Price" has the meaning specified in paragraph
(e)(i)(B).
"Standard Receivable Obligations" means representations, warranties,
covenants, indemnities and other obligations (including Guarantees and
Indebtedness) that are reasonably customary in connection with a Financing
Disposition (as determined by the Company in good faith), including, without
limitation, those relating to the servicing of the assets of a Receivables
Entity, it being understood that any Receivables Repurchase Obligation shall be
deemed to be a Standard Receivable Obligation,
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"Stated Amount" means, as to any share of Junior Preferred Stock at any
time, the sum of: (i) the Liquidation Preference of such share as of such time,
plus (ii) the amount of any accumulated and unpaid dividends with respect to
such share as calculated pursuant to paragraph (c)(i) as of such time.
"Stated Maturity" means, with respect to any security, the date specified
in such security as the fixed date on which the payment of principal of such
security is due and payable, including pursuant to any mandatory redemption
provision (but excluding any provision providing for the repurchase of such
security at the option of the holder thereof upon the happening of any
contingency).
"Subsidiary" of any Person means any corporation, association, partnership
or other business entity of which more than 50% of the total voting power of
shares of Capital Stock or other equity interests (including partnership
interests) entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by (i) such person or (ii) one or
more Subsidiaries of such Person.
"Successor Company" has the meaning specified in paragraph (1)(i).
"Successor Company Stock" has the meaning specified in paragraph
(1)(i)(A).
"Trade Payables" means, with respect to any Person, any accounts payable
or any indebtedness or monetary obligation to trade creditors created, assumed
or guaranteed by such Person arising in the ordinary course of business in
connection with the acquisition of goods or services.
"Transactions" means, collectively, the Allied Acquisition, the offering
and issuance of the Notes and the Senior Discount Notes, the initial borrowings
under the Senior Credit Facility and the Interim Loan Facility, the issuance by
the Company of Capital Stock as part of the consideration for the Allied
Acquisition, and all other related transactions.
"Transfer" unless the context otherwise requires, any sale, assignment,
pledge or other disposition of any security, or of any interest therein, which
could constitute a "sale" as that term is defined in Section 2(3) of the
Securities Act.
"Unrestricted Subsidiary" means for the Company or NAVL, respectively, (i)
any Subsidiary of such Parent that at the time of determination is an
Unrestricted Subsidiary, as designated by the Board in the manner provided
below, and (ii) any Subsidiary of an Unrestricted Subsidiary of such Parent. The
Board may designate any Subsidiary of such
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Parent (including any newly acquired or newly formed Subsidiary of such Parent)
to be an Unrestricted Subsidiary unless such Subsidiary or any of its
Subsidiaries owns any Capital Stock or Indebtedness of, or owns or holds any
Lien on any property of, NAVL or any other Restricted Subsidiary of NAVL that is
not a Subsidiary of the Subsidiary to be so designated. The Board may designate
any Unrestricted Subsidiary of such Parent to be a Restricted Subsidiary of such
Parent; provided, that immediately after giving effect to such designation
either (x) the Company or NAVL could incur at least $1.00 of additional
Indebtedness under paragraph (1)(ii)(A) or (y) the Consolidated Coverage Ratio
of the Company or NAVL would be greater than it was immediately prior to giving
effect to such designation. Any such designation by the Board shall be evidenced
by an Officer's Certificate certifying that such designation complied with the
foregoing provisions.
"Voting Stock" of an entity means all classes of Capital Stock of such
entity then outstanding and normally entitled to vote in the election of
directors or all interests in such entity with the ability to control the
management or actions of such entity.
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IN WITNESS WHEREOF, NA Holding Corporation has caused this Certificate of
Designation to be signed by R. Barry Uber, its President and Chief Executive
Officer, on the date and year first above written.
NA HOLDING CORPORATION
By: /s/ R. Barry Uber
------------------------------------
Name: R. Barry Uber
Title: President and Chief
Executive Officer
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Annex A to Certificate of
Designation for Junior Preferred Stock
THIS DEBENTURE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY OTHER APPLICABLE SECURITIES
LAWS, AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT
AND ANY OTHER APPLICABLE SECURITIES LAWS, AS MORE FULLY
PROVIDED IN SECTION 8.3 OF THIS DEBENTURE.
EACH DEBENTURE MAY HAVE ITS OWN PRINCIPAL AMOUNT AND STATED
AMOUNT, WHICH MAY BE SIGNIFICANTLY GREATER OR LESS THAN OTHER
DEBENTURES. ABSENT MANIFEST ERROR, THE AMOUNT OF PRINCIPAL
AMOUNT SET FORTH IN THE REGISTER FOR EACH DEBENTURE SHALL BE
CONCLUSIVE. PROSPECTIVE TRANSFEREES SHOULD REFER TO THE
REGISTER TO DETERMINE THE PRINCIPAL AMOUNT OF ANY DEBENTURES
THAT THEY MAY BE RECEIVING.
[OTHER LEGENDS, IF ANY, TO BE INCLUDED AS REQUIRED BY LAW]
NA HOLDING CORPORATION
Junior Subordinated Exchange Debentures due [___], 2010
Certificate No. ___, representing
[Number of Debentures] and New York, N.Y.
$[Stated Amount under
Certificate of Designation]
in aggregate initial Principal Amount _________, ___
ARTICLE 1
OBLIGATION TO PAY
FOR VALUE RECEIVED, the undersigned, NA Holding Corporation, a
Delaware corporation (the "Company"), promises to pay to _____________, a
company organized under the laws _____________, or any registered assign thereof
(collectively, the "Holder"), the principal amount of $[Stated Amount under
Certificate of Designation], as adjusted from time to time in accordance with
the following sentence (as so adjusted, the "Principal Amount") on [____], 2010,
with interest on the unpaid balance of such principal amount outstanding from
time to time, at the rates per annum and in the manner set forth below, payable
as provided below after the Exchange Date (as defined in Section 2.1), until
such unpaid balance shall become due and payable (whether at maturity, upon
<PAGE>
any prepayment, or otherwise). As of any time, the Principal Amount of any
Debenture represented by this Debenture Certificate (1) shall be an amount equal
to the excess of principal amount outstanding from time to time of such
Debenture over the Adjustment Amount with respect to such Debenture, and (2) for
the avoidance of doubt shall not include accrued and unpaid interest.
The Debentures shall bear interest, commencing on the Exchange Date, and
interest shall be paid or, if accrued and unpaid, compounded, quarterly on each
Interest Payment Date, at a rate per annum equal to 12.4%, calculated on the
basis of a 360-day year consisting of twelve 30-day months. Interest, when paid,
shall be paid as set forth in Article III and Section 4.2 hereof.
ARTICLE 2
DEFINITIONS
Section 2.1 Definitions.
For all purposes of this Debenture Certificate and the Debentures
represented thereby, except as otherwise expressly provided or unless the
context otherwise requires:
(A) the terms defined in this Debenture Certificate have the
meanings assigned to them in this Debenture Certificate;
(B) "or" is not exclusive;
(C) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP;
(D) the words "herein" "hereof" and "hereunder", this "Debenture
Certificate" and other words of similar import refer to this Debenture
Certificate as a whole and not to any particular paragraph or other
subdivision;
(E) all references to "$" or "dollars" shall refer to the lawful
currency of the United States of America;
(F) the words "include" "included" and "including" as used herein
shall be deemed in each case to be followed by the phrase "without
limitation" if not expressly followed by such phrase or the phrase "but
not limited to"; and
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(G) any reference to a paragraph refers to the specified paragraph
of the Debenture Certificate.
(2) Specific Definitions. As used in this Debenture Certificate, the
following terms shall have the following meanings (with terms defined in the
singular having comparable meanings when used in the plural and vice versa),
unless the context otherwise requires:
"Additional Notes" has the meaning specified in the applicable
Indenture.
"Adjustment Amount" means, with respect to any Debenture at any
time, the sum of (i) the aggregate amount of the reductions made with respect to
such Debenture pursuant to Section 6.4(B) and (ii) an amount, as of any time,
equal to the quotient of (A) an aggregate amount equal to, for each year until
and including the fifth anniversary of the Issue Date, one half of the excess of
(x) all interest paid or accrued (whether or not paid) on the Notes (excluding
any Additional Notes), the Senior Discount Notes and $25.0 million aggregate
principal amount of borrowings under the Tranche B Term Loan Facility (as such
term is defined in the Senior Credit Facility) as of such time over (y) all
interest that would have been paid or accrued as of such time on debt securities
in an aggregate principal amount of $210 million (the "Base Amount") with the
same final Stated Maturity as the Notes and bearing interest at 12% per annum,
with semi-annual interest payments (based on a 360-day year consisting of twelve
30-day months) and no principal payment due prior to such final Stated Maturity
divided by (B) the total number of outstanding shares of Junior Preferred Stock
(prior to the Exchange Date) or Debentures (on and after the Exchange Date),
provided that the aggregate amount determined under this clause (ii) for any
year with respect to all outstanding shares of Junior Preferred Stock (prior to
the Exchange Date) or Debentures (on and alter the Exchange Date) shall not
exceed $2.5 million (the "Annual Cap"). In the event, prior to the fifth
anniversary, of (a) an optional redemption of any Notes or Senior Discount Notes
or (b) an optional prepayment of up to $25 million in aggregate principal amount
of the Tranche B Term Loan (any such redemption or prepayment, a "Redemption
Amount"), (1) the Base Amount shall be reduced by the Redemption Amount and (2)
the Annual Cap shall thereafter be equal to the difference between (X) $2.5
million and (Y) an amount equal to $2.5 million multiplied by a fraction, the
numerator of which is the Redemption Amount and the denominator of which is the
Base Amount.
"Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by
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contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Agent" means any moving or storage company or contractor, or other
Person, that provides sales, packing, warehousing, hauling or other services in
connection with the ordinary course of business or operations of the Company or
any of its Subsidiaries, or any Affiliate of any such Agent.
"Agent Guarantee" means any Guarantee by the Company, NAVL or any
Restricted Subsidiary of Indebtedness or other obligations of any Agent.
"all or substantially all" has the meaning given to such phrase in
the Revised Model Business Corporation Act and commentary thereto.
"Allied Acquisition" means the acquisition of Capital Stock and/or
assets of certain Subsidiaries of NFC engaged in moving services businesses
pursuant to the Acquisition Agreement dated as of September 14, 1999 between the
Company and NFC, and the other transactions contemplated thereby.
"Average Life" means, as of the date of determination, with respect
to any Indebtedness or Preferred Stock, the quotient obtained by dividing (i)
the sum of the products of the numbers of years from the date of determination
to the dates of each successive scheduled principal payment of such Indebtedness
or redemption or similar payment with respect to such Preferred Stock multiplied
by the amount of such payment by (ii) the sum of all such payments.
"Bank Indebtedness" means any and all amounts, whether outstanding
on the Issue Date or thereafter incurred, payable under or in respect of the
Senior Credit Facility, including without limitation principal, premium (if
any), interest (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company or any
Restricted Subsidiary whether or not a claim for post-filing interest is allowed
in such proceedings), fees, charges, expenses, reimbursement obligations,
guarantees, other monetary obligations of any nature and all other amounts
payable thereunder or in respect thereof.
"Bankruptcy Law" has the meaning set forth in Section 5.1.
"Board" means the Board of Directors of the Company or NAVL, or any
committee thereof duly authorized to act on behalf of such Board.
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"Board of Directors" has the meaning specified in the first
paragraph of the Certificate of Designation.
"Borrowing Base" means 85% of accounts receivables of NAVL and its
Restricted Subsidiaries (determined in accordance with GAAP as of the end of the
most recently ended fiscal quarter for which consolidated financial statements
of NAVL are available).
"Business Day" means any day other than a Saturday, Sunday or other
day on which commercial banking institutions are authorized or required by law
to close in New York City.
"Capitalized Lease Obligation" means an obligation that is required
to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP. The Stated Maturity of any
Capitalized Lease Obligation shall be the date of the last payment of rent or
any other amount due under the related lease.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"Certificate of Designation" means the Certificate of Designation of
the powers, preferences and relative, participating, optional and other special
rights of the Junior Exchangeable Preferred Stock due 2010, par value $0.01 per
share, of the Company.
"CD&R" means Clayton, Dubilier & Rice, Inc.
"CD&R Fund" means Clayton, Dubilier & Rice Fund V Limited
Partnership, a Cayman Islands exempted limited partnership (together with any
successor investment vehicle managed by CD&R).
"Change of Control" means:
(A) a Change of Control Triggering Event (as defined in the Indentures)
has occurred and is continuing (without waiver under the respective
Indenture); and
(B) (1) any "person" (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act), other than one or more Permitted Holders, is
or becomes
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the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under
the Exchange Act), directly or indirectly, of more than 50% of the
total voting power of the Voting Stock of the Company;
(2) the Company sells or transfers (in one or a series of related
transactions) all or substantially all of the assets of the Company
and its Restricted Subsidiaries to another Person (other than one or
more Permitted Holders or the Company or one or more Subsidiaries
thereof); or
(3) during any period of two consecutive years (during which period
the Debentures shall have been outstanding), individuals who at the
beginning of such period were members of the Board of Directors
(together with any new members thereof whose election by the Board
of Directors or whose nomination for election by holders of Capital
Stock of the Company was approved by one or more Permitted Holders
or by a vote of a majority of the members of the Board of Directors
then still in office who were either members thereof at the
beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors then in office.
"Change of Control Default" has the meaning specified in the
definition of "Mandatory Redemption Event" below.
"Change of Control Purchase Price" has the meaning specified in
Section 7.4(i).
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission.
"Common Stock" has the meaning specified in paragraph (b) of the
Certificate of Designation.
"Company" has the meaning specified in the first paragraph of this
Debenture Certificate.
"Consolidated Coverage Ratio" of the Company or NAVL, respectively,
as of any date of determination means the ratio of (i) the aggregate amount of
Consolidated EBITDA of such Parent for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such determination for
which consolidated financial statements of such Parent are available to (ii)
Consolidated Interest Expense of such Parent for such
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redeemed, defeased or otherwise acquired, retired or discharged with
respect to such Parent and its continuing Restricted Subsidiaries in
connection with such Sale for such period (including but not limited to
through the assumption of such Indebtedness by another Person) plus (B) if
the Capital Stock of any Restricted Subsidiary of such Parent is sold, the
Consolidated Interest Expense for such period attributable to the
Indebtedness of such Restricted Subsidiary to the extent such Parent and
its continuing Restricted Subsidiaries are no longer liable for such
Indebtedness after such Sale,
(4) if since the beginning of such period, such Parent or any
Restricted Subsidiary of such Parent (by merger, consolidation or
otherwise) shall have made an Investment in any Person that thereby
becomes a Restricted Subsidiary of such Parent, or otherwise acquired any
company, any business or any group of assets constituting an operating
unit of a business, including any such Investment or acquisition occurring
in connection with a transaction causing a calculation to be made
hereunder (any such Investment or acquisition, a "Purchase"), Consolidated
EBITDA and Consolidated Interest Expense for such period shall be
calculated after giving pro forma effect thereto (including the Incurrence
of any related Indebtedness) as if such Purchase occurred on the first day
of such period, and
(5) if since the beginning of such period, any Person became a
Restricted Subsidiary of such Parent or was merged or consolidated with or
into of such Parent or any Restricted Subsidiary of such Parent, and since
the beginning of such period such Person shall have Discharged any
Indebtedness or made any Sale or Purchase that would have required an
adjustment pursuant to clause (2), (3) or (4) above if made by such Parent
or a Restricted Subsidiary of such Parent during such period, Consolidated
EBITDA and Consolidated Interest Expense for such period shall be
calculated after giving pro forma effect thereto as if such Discharge,
Sale or Purchase occurred on the first day of such period.
For purposes of this definition, whenever pro forma effect is to be given
to any Sale, Purchase or other transaction, or the amount of income or earnings
relating thereto and the amount of Consolidated Interest Expense associated with
any Indebtedness Incurred or repaid, repurchased, redeemed, defeased or
otherwise acquired, retired or discharged in connection therewith, the pro forma
calculations in respect thereof may include anticipated cost savings relating to
any such Sale, Purchase or other transaction that the Company or NAVL reasonably
believes in good faith could have been achieved during the relevant four quarter
period as a result of such Sale, Purchase or other transaction (provided that
both (i) such cost savings were identified and quantified in an Officer's
Certificate at the time of the consummation of such transaction and (ii) with
respect to each such transaction completed prior to the 9Oth day preceding the
relevant
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date of determination, actions were commenced or initiated by the Company or
NAVL within 90 days of the consummation of such transaction to effect such cost
savings identified in such Officer's Certificate and with respect to any other
transaction, such Officer's Certificate sets forth the specific steps to be
taken within the 90 days after the consummation of such transaction to
accomplish such cost savings). If any Indebtedness bears a floating rate of
interest and is being given pro forma effect, the interest expense on such
Indebtedness shall be calculated as if the rate in effect on the date of
determination had been the applicable rate for the entire period (taking into
account any Interest Rate Agreement applicable to such Indebtedness). If any
Indebtedness bears, at the option of the Company or a Restricted Subsidiary, a
rate of interest based on a prime or similar rate, a eurocurrency interbank
offered rate or other fixed or floating rate, and such Indebtedness is being
given pro forma effect, the interest expense on such Indebtedness shall be
calculated by applying such optional rate as the Company or such Restricted
Subsidiary may designate. If any Indebtedness that is being given pro forma
effect was Incurred under a revolving credit facility, the interest expense on
such Indebtedness shall be computed based upon the average daily balance of such
Indebtedness during the applicable period. Interest on a Capitalized Lease
Obligation shall be deemed to accrue at an interest rate determined in good
faith by a responsible financial or accounting officer of the Company or NAVL to
be the rate of interest implicit in such Capitalized Lease Obligation in
accordance with GAAP.
"Consolidated EBITDA" of the Company or NAVL, respectively, means,
for any period, the Consolidated Net Income of such Parent for such period, plus
the following to the extent deducted in calculating such Consolidated Net
Income: (i) provision for all taxes (whether or not paid, estimated or accrued)
based on income, profits or capital, (ii) Consolidated Interest Expense, (iii)
depreciation, amortization (including but not limited to amortization of
goodwill and intangibles and amortization and write-off of financing costs) and
all other non-cash charges or non-cash losses, (iv) any expenses or charges
related to any Equity Offering, Investment or Indebtedness permitted by this
Debenture Certificate (whether or not consummated or incurred) and (v) the
amount of any minority interest expense. To the extent Consolidated EBITDA of
such Parent would otherwise include the amount of any Receivables Fees excluded
from Consolidated Interest Expense of such Parent pursuant to clause (iii) of
the definition of Consolidated Interest Expense, Consolidated EBITDA of such
Parent shall be reduced by such amount.
"Consolidated Interest Expense" of the Company or NAVL,
respectively, means, for any period, (i) the total interest expense of such
Parent and its Restricted Subsidiaries to the extent deducted in calculating
Consolidated Net Income of such Parent, net of any interest income of such
Parent and its Restricted Subsidiaries, including without limitation any such
interest expense consisting of (a) interest expense attributable
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to Capitalized Lease Obligations, (b) amortization of debt discount, (c)
interest in respect of Indebtedness of any other Person that has been Guaranteed
by such Parent or any Restricted Subsidiary of such Parent (other than
Indebtedness Guaranteed under any Management Guarantee or Agent Guarantee,
except to the extent the interest thereon is actually being paid by such Parent
or a Restricted Subsidiary thereof), (d) non-cash interest expense, (e) the
interest portion of any deferred payment obligation, and (f) commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers' acceptance financing, plus (ii) dividends paid in cash in respect of
Disqualified Stock of such Parent or a Restricted Subsidiary of such Parent or
in respect of Preferred Stock of a Restricted Subsidiary of such Parent and
minus (iii) to the extent otherwise included in such interest expense referred
to in clause (i) above, Receivables Fees and amortization or write-off of
financing costs, in each case under clauses (i) through (iii) as determined on a
Consolidated basis in accordance with GAAP; provided, that gross interest
expense shall be determined after giving effect to any net payments made or
received by such Parent and its Restricted Subsidiaries with respect to Interest
Rate Agreements.
"Consolidated Net Income" of the Company or NAVL, respectively,
means, for any period, the net income (loss) of such Parent and its Restricted
Subsidiaries, determined on a consolidated basis in accordance with GAAP and
before any reduction in respect of Preferred Stock dividends (including
dividends in respect of any Junior Preferred Stock); provided, that there shall
not be included in such Consolidated Net Income:
(i) any net income (loss) of any Person if such Person is not a
Restricted Subsidiary of such Parent, except that (A) subject to the
limitations contained in clause (iv) below, such Parent's equity in the
net income of any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount actually distributed by
such Person during such period to such Parent or a Restricted Subsidiary
of such Parent as a dividend or other distribution (subject, in the case
of a dividend or other distribution to a Restricted Subsidiary of such
Parent, to the limitations contained in clause (iii) below) and (B) such
Parent's equity in the net loss of such Person shall be included to the
extent of the aggregate Investment of such Parent or any of its Restricted
Subsidiaries in such Person,
(ii) any net income (loss) of any Person acquired by such Parent or
a Restricted Subsidiary of such Parent in a pooling of interests
transaction for any period prior to the date of such acquisition,
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(iii) any net income (loss) of any Restricted Subsidiary of NAVL if
such Restricted Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of similar
distributions by such Restricted Subsidiary, directly or indirectly, to
NAVL by operation of the terms of such Restricted Subsidiary's charter or
any agreement, instrument, judgment, decree, order, statute or
governmental rule or regulation applicable to such Restricted Subsidiary
or its stockholders (other than (x) restrictions that have been waived or
otherwise released, (y) restrictions pursuant to this Debenture
Certificate, the Notes, the Senior Discount Notes or any Indenture and (z)
restrictions in effect on the Issue Date with respect to a Restricted
Subsidiary and other restrictions with respect to such Restricted
Subsidiary that taken as a whole are not materially less favorable to the
Noteholders than such restrictions in effect on the Issue Date), except
that (A) subject to the limitations contained in clause (iv) below, NAVL's
equity in the net income of any such Restricted Subsidiary for such period
shall be included in such Consolidated Net Income up to the aggregate
amount of any dividend or distribution that was or that could have been
made by such Restricted Subsidiary during such period to NAVL or another
Restricted Subsidiary of NAVL (subject, in the case of a dividend that
could have been made to another Restricted Subsidiary of NAVL, to the
limitation contained in this clause) and (B) the net loss of such
Restricted Subsidiary shall be included to the extent of the aggregate
Investment of NAVL or any of its other Restricted Subsidiaries in such
Restricted Subsidiary,
(iv) any gain or loss realized upon the sale or other disposition of
any asset of such Parent or any Restricted Subsidiary of such Parent
(including pursuant to any sale/leaseback transaction) that is not sold or
otherwise disposed of in the ordinary course of business (as determined in
good faith by the Board),
(v) any item classified as an extraordinary, unusual or nonrecurring
gain, loss or charge (including without limitation (a) any compensation
expense for stock options that will be cashed out, converted, exchanged or
otherwise retired in connection with the Allied Acquisition, (b) any
charge or expense incurred for employee bonuses in connection with the
Allied Acquisition, and (c) fees, expenses and charges associated with the
Allied Acquisition or any acquisition, merger or consolidation after the
Issue Date),
(vi) the cumulative effect of a change in accounting principles,
(vii) all deferred financing costs written off and premiums paid in
connection with any early extinguishment of Indebtedness,
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(viii) any unrealized gains or losses in respect of Currency
Agreements,
(ix) any unrealized foreign currency transaction gains or losses in
respect of Indebtedness of any Person denominated in a currency other than
the functional currency of such Person, and
(x) any non-cash compensation charge arising from any grant of
stock, stock options or other equity based awards.
In the case of any unusual or nonrecurring gain, loss or charge not
included in Consolidated Net Income pursuant to clause (v) above in any
determination thereof, the Company or NAVL will prepare an Officer's Certificate
promptly after the date on which Consolidated Net Income is so determined,
setting forth the nature and amount of such unusual or nonrecurring gain, loss
or charge.
"Consolidated Tangible Assets" means, as of any date of
determination, the total assets less the total intangible assets (including,
without limitation, goodwill) shown on the consolidated balance sheet of NAVL
and its Restricted Subsidiaries as of the most recent date for which such a
balance sheet is available, determined on a consolidated basis in accordance
with GAAP (and, in the case of any determination relating to any Incurrence of
Indebtedness, on a pro forma basis including any property or assets being
acquired in connection therewith).
"Consolidation" means for the Company or NAVL, respectively, the
consolidation of the accounts of each of the Restricted Subsidiaries of such
Parent with those of such Parent in accordance with GAAP; provided that
"Consolidation" will not include consolidation of the accounts of any
Unrestricted Subsidiary of such Parent, but the interest of such Parent or any
Restricted Subsidiary of such Parent in any Unrestricted Subsidiary of such
Parent will be accounted for as an investment. The term "Consolidated" has a
correlative meaning.
"Credit Facilities" means, one or more of (x) the Senior Credit
Facility and (y) other facilities or arrangements, in each case with one or more
banks or other institutions providing for revolving credit loans, term loans,
receivables financings (including without limitation through the sale of
receivables to such institutions or to special purpose entities formed to borrow
from such institutions against such receivables), letters of credit or other
Indebtedness, in each case, including all agreements, instruments and documents
executed and delivered pursuant to or in connection with any of the foregoing,
in each case as the same may be amended, supplemented, waived or otherwise
modified from time to time, or refunded, refinanced, restructured, replaced,
renewed, repaid, increased or extended from time to time (whether in whole or in
part, whether with
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the original banks or other institutions or other banks or other institutions or
otherwise, and whether provided under any original Credit Facility or one or
more other credit agreements, indentures, financing agreements or other Credit
Facilities or otherwise). Without limiting the generality of the foregoing, the
term "Credit Facility" shall include any agreement (i) changing the maturity of
any Indebtedness incurred thereunder or contemplated thereby, (ii) adding
Subsidiaries of the Company as additional borrowers or guarantors thereunder,
(iii) increasing the amount of Indebtedness incurred thereunder or available to
be borrowed thereunder or (iv) otherwise altering the terms and conditions
thereof.
"Currency Agreement" means, in respect of a Person, any foreign
exchange contract, currency swap agreement or other similar agreement or
arrangements (including derivative agreements or arrangements), as to which such
Person is a party or a beneficiary.
"Debenture" means, individually and collectively the Debentures
represented by this Debenture Certificate and any other junior subordinated
exchange debenture of like terms issued by the Company in exchange for the
Debentures represented by this Debenture Certificate (upon a transfer or
otherwise) or in lieu of a payment in cash pursuant to Article 1 or Article 4.
References to "this Debenture" are to the Debentures represented by this
Debenture Certificate.
"Debt Agreements" means the Senior Credit Facility, the Indentures,
the Notes and the Senior Discount Notes, and any refinancing thereof, provided
that any agreement governing any such refinancing shall not be a Debt Agreement
to the extent that it imposes greater restrictions on the payment of interest
on, or the mandatory redemption or purchase of, the Debentures than the Debt
Agreement thereby refinanced.
"Default Amount" means (i) $0 for any date during the period
beginning on the Issue Date and ending on the date before the first Payment Date
falling on or after the 63-month anniversary of the Issue Date and (ii) as of
any other date, the lesser of (A) the aggregate amount of, as the case may be,
dividends or interest actually permitted under the Debt Agreements to have been
declared (in the case of dividends) and paid by the Company on the Junior
Preferred Stock or Debentures on each Payment Date that occurs during the period
beginning on the first Payment Date falling on or after the 63-month anniversary
of the Issue Date and ending on such date, (B) the aggregate amount of dividends
actually permitted under the Debt Agreements to have been declared and paid by
NAVL to the Company on each such Payment Date for the purpose of paying
dividends on the Junior Preferred Stock or interest on the Debentures on such
respective Payment Date and (C) the sum of the Minimum Amounts applicable to
each Payment Date
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that occurs during the period beginning on the first Payment Date falling on or
after the 63-month anniversary of the Issue Date and ending on such date.
"Default Rate" means a quarterly rate equal to (i) 1.50% in the case
of each Dividend Payment Date or Interest Payment Date occurring during the
one-year period beginning on the first Dividend Payment Date or Interest Payment
Date falling on or after the 63-month anniversary of the Issue Date and (ii)
1.75% in the case of each Dividend Payment Date or Interest Payment Date falling
on or after the 75-month anniversary of the Issue Date.
"Designated Senior Indebtedness" means (i) the Bank Indebtedness,
(ii) the Company's obligations under the Notes and the Senior Discount Notes and
the Indentures, and (iii) any one or more issues of other Senior Indebtedness
specifically designated by the Company in the instrument evidencing or governing
such Senior Indebtedness as "Designated Senior Indebtedness" for purposes of
this Debenture.
"Disqualified Stock" means, with respect to any Person, any Capital
Stock (other than Management Stock) that by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable) or upon the happening of any event (i) matures or is mandatorily
redeemable pursuant to a sinking fund obligation or otherwise, (ii) is
convertible or exchangeable for Indebtedness or Disqualified Stock or (iii) is
redeemable at the option of the holder thereof, in whole or in part, in each
case on or prior to the 91st day following the final Stated Maturity of the
Notes. Notwithstanding the preceding sentence, (a) any Capital Stock that would
constitute Disqualified Stock solely because the holders thereof have the right
to require the Company or NAVL to repurchase such Capital Stock upon the
occurrence of an event described therein as a change of control or an asset sale
shall not constitute Disqualified Stock if the terms of such Capital Stock
provide that the Company or NAVL may not repurchase or redeem any such Capital
Stock pursuant to such provisions unless such repurchase or redemption complies
with Section 6.2, (b) any Capital Stock that would constitute Disqualified Stock
solely because such Capital Stock is issued pursuant to any plan for the benefit
of employees and may be required to be repurchased by the Company or NAVL in
order to satisfy applicable regulatory obligations shall not constitute
Disqualified Stock and (c) the Junior Preferred Stock shall not constitute
Disqualified Stock.
"Dividend Payment Date" means March 15, June 15, September 15 and
December 15 of each year.
"Dividend Period" has the meaning set forth in the Certificate of
Designation.
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"Domestic Subsidiary" of the Company or NAVL, respectively, means
any Restricted Subsidiary of such Parent other than a Foreign Subsidiary of such
Parent.
"Equity Offering" means a sale of Capital Stock (other than
Disqualified Stock) of the Company or NAVL (x) that is a sale of Capital Stock
of the Company or NAVL or (y) proceeds of which are contributed to the Company
or any of its Restricted Subsidiaries.
"Event of Default" has the meaning specified in Article 5.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Date" has the meaning specified in paragraph (g)(i)(A) of
the Certificate of Designation.
"Exchange Notice" has the meaning specified in paragraph (g)(i)(A).
"Financing Disposition" means any sale, transfer, conveyance or
other disposition of property or assets by the Company or any Subsidiary thereof
to any Receivables Entity, or by any Receivables Subsidiary, in each case in
connection with the Incurrence by a Receivables Entity of Indebtedness, or
obligations to make payments to the obligor on Indebtedness, which may be
secured by a Lien in respect of such property or assets.
"Foreign Subsidiary" of the Company or NAVL, respectively, means (a)
any Restricted Subsidiary of such Parent that is not organized under the laws of
the United States of America or any state thereof or the District of Columbia
and (b) any Restricted Subsidiary of such Parent that has no material assets
other than securities of one or more Foreign Subsidiaries, and other assets
relating to an ownership interest in any such securities or Subsidiaries.
"Foreign Subsidiary Coverage Ratio" of the Company or NAVL,
respectively, as of any date of determination means the ratio of (i) the
combined portion attributable to Foreign Subsidiaries of such Parent, taken as a
whole, of the aggregate amount of Consolidated EBITDA of such Parent for the
period of the most recent four consecutive fiscal quarters ending prior to the
date of such determination for which consolidated financial statements of such
Parent are available to (ii) the combined portion attributable to Foreign
Subsidiaries of such Parent, taken as a whole, of Consolidated Interest Expense
of such Parent for such four fiscal quarters, all calculated after giving effect
to all intercompany eliminations applied in preparing the relevant consolidated
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financial statements of such Parent (and without giving effect to clause (iii)
of the definition of the term Consolidated Net Income as it relates to
restrictions on the payment of dividends or the making of similar distributions
by any Foreign Subsidiary to NAVL, or any Domestic Subsidiary of NAVL, but
giving effect to such clause as it relates to any such restrictions on the
payment of dividends or the making of similar distributions by any Foreign
Subsidiary of NAVL to another Foreign Subsidiary of NAVL), and otherwise in
accordance with the definition of the term "Coverage Ratio" (including but not
limited to in accordance with all pro forma and other adjustments provided for
in such definition).
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the Issue Date (for purposes of the
definitions of the terms "Consolidated Coverage Ratio," "Foreign Subsidiary
Coverage Ratio," "Consolidated EBITDA," "Consolidated Interest Expense,"
"Consolidated Net Income" and "Consolidated Tangible Assets," all defined terms
in this Debenture Certificate to the extent used in or relating to any of the
foregoing definitions, and all ratios and computations based on any of the
foregoing definitions) and as in effect from time to time (for all other
purposes under this Debenture Certificate), including those set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as approved by a significant segment of the accounting profession.
All ratios and computations based on GAAP contained in this Debenture
Certificate shall be computed in conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any other Person; provided that the term "Guarantee" shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement or Currency Agreement.
"Holder" shall mean the registered owner of this Debenture, as set
forth in the Register.
"Holding Expenses" means (i) costs (including all professional fees
and expenses) incurred by the Company to comply with its reporting obligations
under federal or state laws or under any Indenture, including any reports filed
with respect to the Securities Act, Exchange Act or the respective rules and
regulations promulgated thereunder, (ii) indemnification obligations of the
Company owing to directors, officers,
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employees or other Persons under its charter or by-laws or pursuant to written
agreements with any such Person, (iii) fees and expenses payable by the Company
in connection with the Transactions, (iv) other operational expenses of the
Company incurred in the ordinary course of business, and (v) expenses incurred
by the Company in connection with any public offering of Capital Stock or
Indebtedness.
"Incur" means issue, assume, enter into any Guarantee of; incur or
otherwise become liable for; provided, however, that any Indebtedness or Capital
Stock of a Person existing at the time such Person becomes a Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be
Incurred by such Subsidiary at the time it becomes a Subsidiary. Accrual of
interest, the accretion of accreted value and the payment of interest in the
form of additional Indebtedness will not be deemed to be an Incurrence of
Indebtedness. Any Indebtedness issued at a discount (including Indebtedness on
which interest is payable through the issuance of additional Indebtedness) shall
be deemed Incurred at the time of original issuance of the Indebtedness at the
initial accreted amount thereof.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication):
(i) the principal of indebtedness of such Person for borrowed
money,
(ii) the principal of obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments,
(iii) all reimbursement obligations of such Person in respect of
letters of credit or other similar instruments (the amount of
such obligations being equal at any time to the aggregate then
undrawn and unexpired amount of such letters of credit or
other instruments plus the aggregate amount of drawings
thereunder that have not then been reimbursed),
(iv) all obligations of such Person to pay the deferred and unpaid
purchase price of property (except Trade Payables), which
purchase price is due more than one year after the date of
placing such property in final service or taking final
delivery and title thereto,
(v) all Capitalized Lease Obligations of such Person,
(vi) the redemption, repayment or other repurchase amount of such
Person with respect to any Disqualified Stock of such Person
or (if
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such Person is a Subsidiary of NAVL other than a Note
Guarantor) any Preferred Stock of such Subsidiary, but
excluding, in each case, any accrued dividends (the amount of
such obligation to be equal at any time to the maximum fixed
involuntary redemption, repayment or repurchase price for such
Capital Stock, or if less (or if such Capital Stock has no
such fixed price), to the involuntary redemption, repayment or
repurchase price therefor calculated in accordance with the
terms thereof as if then redeemed, repaid or repurchased, and
if such price is based upon or measured by the fair market
value of such Capital Stock, such fair market value shall be
as determined in good faith by the Board or the board of
directors or other governing body of the issuer of such
Capital Stock),
(vii) all Indebtedness of other Persons secured by a Lien on any
asset of such Person, whether or not such Indebtedness is
assumed by such Person provided that the amount of
Indebtedness of such Person shall be the lesser of (A) the
fair market value of such asset at such date of determination
(as determined good faith by the Company) and (B) the amount
of such Indebtedness of such other Persons,
(viii) Guarantees of all Indebtedness of other Persons to the extent
so Guaranteed by such Person, and
(ix) to the extent not otherwise included in this definition, net
Hedging Obligations of such Person (the amount of any such
obligation to be equal at any time to the termination value of
such agreement or arrangement giving rise to such Hedging
Obligation that would be payable by such Person at such time).
The amount of Indebtedness of any Person at any date shall be determined
as set forth above or otherwise provided in Article VI, or otherwise shall equal
the amount thereof that would appear on a balance sheet of such Person
(excluding any notes thereto) prepared in accordance with GAAP. The Junior
Preferred Stock shall not constitute Indebtedness.
"Indentures" mean the Note Indenture, the Senior Discount Note
Indenture and the Senior Discount Loan Agreement.
"Interest Default" means the failure of the Company to have paid
interest on the Debentures (or dividends on (or Principal Amounts in respect of)
the Junior Preferred Stock for which such Debentures were exchanged) as of any
date (other than
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any date as of which the Default Amount is $0) in an amount at least equal to
the Default Amount as of such date.
"Interest Payment Date" means March 15, June 15, September 15 and
December 15 of each year.
"Interest Period" means each Quarterly Interest Period.
"Interest Rate Agreement" means, with respect to any Person, any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement (including derivative agreements or
arrangements), as to which such Person is party or a beneficiary.
"Interim Loan Facility" means the loan agreement dated as of the
Issue Date among the Company, The Chase Manhattan Bank and Bank of America (or
affiliates of such institutions), together with any notes, guarantees, pledge
agreements, security agreements, other collateral documents, and other
agreements, instruments and documents, executed and delivered pursuant to or in
connection with any of the foregoing, in each case as the same may be amended,
supplemented, waived or otherwise modified from time to time.
"Inventory" means goods held for sale or lease by a Person in the
ordinary course of business, net of any reserve for goods that have been
segregated by such Person to be returned to the applicable vendor for credit, as
determined in accordance with GAAP.
"Investment" in any Person by any other Person means any direct or
indirect advance, loan or other extension of credit (other than to customers,
suppliers, Agents, directors, officers or employees of any Person in the
ordinary course of business) or capital contribution (by means of any transfer
of cash or other property to others or any payment for property or services for
the account or use of others) to, or any purchase or acquisition of Capital
Stock, Indebtedness or other similar instruments issued by, such Person. A
Guarantee shall not be deemed to be or give rise to an Investment until such
Guarantee is funded (in whole or in part). The amount of any Investment
outstanding at any time shall be the original cost of such Investment, reduced
(at the Company's option) by any dividend, distribution, interest payment,
return of capital, repayment or other amount or value received in respect of
such Investment.
"Issue Date" means the date on which the Junior Preferred Stock was
originally issued by the Company under the Certificate of Designation.
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"Junior Payment" has the meaning specified in paragraph (1)(ii)(A).
"Junior Preferred Stock" has the meaning specified in paragraph (a)
of the Certificate of Designation.
"Junior Securities" has the meaning specified in paragraph (b)(i) of
the Certificate of Designation.
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).
"Liquidation Preference" has the meaning specified in paragraph (a)
of the Certificate of Designation.
"Majority Holders" has the meaning specified in section 6.1.
"Management Advances" means (1) loans or advances made to directors,
officers or employees of the Company or any Restricted Subsidiary (x) in respect
of travel, entertainment or moving-related expenses incurred in the ordinary
course of business, (y) in respect of moving-related expenses incurred in
connection with any closing or consolidation of any facility, or (z) in the
ordinary course of business and (in the case of this clause (z)) not exceeding
$2.5 million in the aggregate outstanding at any time, (2) promissory notes of
Management Investors acquired in connection with the issuance of Management
Stock to such Management Investors, (3) loans to Management Investors of funds
applied to purchase Management Stock in an aggregate principal amount not
exceeding $10.0 million outstanding at any time (less the aggregate principal
amount of then outstanding borrowings by Management Investors then guaranteed by
the Company or NAVL pursuant to clause (x) of the definition of Management
Guarantees), (4) Management Guarantees, or (5) other Guarantees of borrowings by
Management Investors in connection with the purchase of Management Stock, which
Guarantees are permitted under Section 6.3.
"Management Agreements" means, collectively, the Consulting
Agreement, dated as of March 30, 1998, among the Company, NAVL and CD&R (and, in
each case, its respective permitted successors and assigns thereunder) and the
Indemnification Agreement, dated as of March 30, 1998, among the Company, NAVL,
CD&R and Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands
exempted limited Partnership (and, in each case, its respective permitted
successors and assigns), as each may be amended, supplemented, waived or
otherwise modified from time to time in accordance with the terms thereof.
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"Management Guarantees" means guarantees (x) of up to an aggregate
principal amount of $10.0 million of borrowings by Management Investors in
connection with their purchase of Management Stock outstanding at any time (less
the aggregate principal amount of then outstanding loans made to Management
Investors by the Company or NAVL pursuant to clause (3) of the definition of
Management Advances) or (y) made on behalf of, or in respect of loans or
advances made to, directors, officers or employees of the Company or any
Restricted Subsidiary (1) in respect of travel, entertainment and moving-related
expenses incurred in the ordinary course of business, or (2) in the ordinary
course of business and (in the case of this clause (2)) not exceeding $2.5
million in the aggregate outstanding at any time.
"Management Investors" means the officers, directors, employees and
other members of the management of the Company, NAVL or any of their respective
Subsidiaries (or of any Agent), or family members or relatives thereof, or
trusts or partnerships for the benefit of any of the foregoing, or any of their
heirs, executors, successors and legal representatives, or any Agent, who at any
date beneficially own or have the right to acquire, directly or indirectly,
Capital Stock of the Company or NAVL.
"Management Stock" means Capital Stock of the Company or NAVL
(including any options, warrants or other rights in respect thereof) held by any
of the Management Investors.
"Mandatory Redemption Event" has occurred if (1) there is an
Interest Default for four consecutive quarterly periods; (2) the Company is
permitted by the Debt Agreements but fails to discharge any redemption
obligation of the Debentures when required, and NAVL is permitted by the Debt
Agreements to dividend sufficient funds to the Company for such purpose; (3) the
Company is permitted by the Debt Agreements but fails to make an Offer to
purchase all outstanding Debentures following a Change of Control if such Offer
to purchase is required to be made pursuant to Section 7.4 hereof or fails to
purchase Debentures when required from Holders who elect to have such Debentures
purchased pursuant to such Offer (a "Change of Control Default"), and in each
case NAVL is permitted by the Debt Agreements to dividend sufficient funds to
the Company for the purpose of purchasing all such outstanding Debentures or all
such Debentures of electing Holders, as the case may be; or (4) the Company
breaches or violates one of the provisions set forth in Article 6 hereof and the
breach or violation continues for a period of 60 days or more after the Company
receives notice thereof specifying the default from the Holders of at least 25%
of the Principal Amount of Debentures then outstanding and there has been an
acceleration of the maturity of the outstanding indebtedness under any Debt
Agreements.
"Mandatory Redemption Price" has the meaning specified in Section
7.2.
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"Minimum Amount" means, with respect to any Payment Date, an amount
equal to the product of the Default Rate with respect to such date and the
aggregate Stated Amounts as of such date of each Debenture and each share of
Junior Preferred Stock for which such Debenture was exchanged.
"Moody's" means Moody's Investors Service, Inc., and its successors.
"NAVL" means North American Van Lines, Inc., a Delaware corporation,
and any successor thereto.
"Net Cash Proceeds," with respect to any issuance or sale of any
securities of the Company or any Subsidiary by the Company or any Subsidiary, or
any capital contribution, means the cash proceeds of such issuance, sale or
contribution net of attorneys' fees, accountants' fees, underwriters' or
placement agents' fees, discounts or commissions and brokerage, consultant and
other fees actually incurred in connection with such issuance, sale or
contribution and net of taxes paid or payable as a result thereof.
"NFC" means NFC plc, a company organized under the laws of England
and Wales.
"Note Guarantor" means any Restricted Subsidiary that enters into a
Guarantee of any Notes.
"Noteholder" means the Person in whose name a Note is registered in
the applicable Note register of the Company.
"Notes" means the 13 3/8% Senior Subordinated Notes of NAVL due 2009
issued under the Note Indenture, in an aggregate principal amount of $150.0
million, any Exchange Notes (as defined in the Note Indenture) and any
Additional Notes.
"Note Indenture" means the Indenture, dated as of the Issue Date,
between NAVL and State Street Bank and Trust Company, as Trustee, pursuant to
which Notes are issued, as such Indenture may be amended, supplemented, waived
or otherwise modified from time to time, or refunded, refinanced, restructured,
replaced, renewed, repaid, increased or extended from time to time (whether in
whole or in part, and whether provided under the original Note Indenture or one
or more other credit agreements, indentures or financing agreements or
otherwise).
"Offer" has the meaning specified in Section 7.4(i).
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"Officer" means, with respect to the Company or NAVL, the Chairman
of the Board, the President, the Chief Executive Officer, the Chief Financial
Officer, any Vice President, the Controller, the Treasurer or the Secretary (a)
of such Person or (b) if such Person is owned or managed by a single entity, of
such entity (or any other individual designated as an "Officer" for the purposes
of the Certificate of Designation or this Debenture Certificate by the Board).
"Officer's Certificate" means a certificate signed by one Officer of
the Company or NAVL.
"Opinion of Counsel" means a written opinion from Debevoise &
Plimpton, or other legal counsel who is reasonably acceptable to the Majority
Holders. The counsel may be an employee of or counsel to the Company or NAVL.
"Optional Redemption Price" has the meaning specified in Section
7.1(a).
"Parent" means the Company or NAVL, as the case may be.
"Parity Securities" has the meaning specified in paragraph (b)(ii)
of the Certificate of Designation.
"Payment Date" means March 15, June 15, September 15 and December 15
of each year.
"Permitted Holder" means any of the following: (i) any of CD&R Fund,
the Management Investors, CD&R and their respective Affiliates; (ii) any
investment fund or vehicle managed, sponsored or advised by CD&R and (iii) any
Person acting in the capacity of an underwriter in connection with a public or
private offering of Capital Stock of the Company or NAVL.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, limited liability company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock" as applied to the Capital Stock of any corporation
means Capital Stock of any class or classes (however designated) that is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
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"Public Offering" any underwritten public offering of Common Stock
led by one or more underwriters at least one of which is of nationally
recognized standing pursuant to an effective registration statement under the
Securities Act.
"Purchase Date" with respect to any Debentures, means the date on
which such Debentures are purchased by the Company as contemplated by Section
7.4 above.
"Purchase Money Obligations" means any Indebtedness Incurred to
finance or refinance the acquisition, leasing, construction or improvement of
property (real or personal) or assets, and whether acquired through the direct
acquisition of such property or assets or the acquisition of the Capital Stock
of any Person owning such property or assets, or otherwise.
"Purchase Notice" has the meaning specified in Section 7.4(i).
"QIB" or "Qualified Institutional Buyer" means a "qualified
institutional buyer," as that term is defined in Rule 144A under the Securities
Act of 1933, as amended.
"Quarterly Interest Period" shall mean the quarterly period
commencing on each March 15, June 15, September 15 and December 15 and ending on
the day before the following Interest Payment Date.
"Qualified Proceeds" means property or assets that are used, usable
or useful in, or a majority of the Voting Stock of any Person engaged in, a
Related Business; provided that the fair market value of any such assets or
Capital Stock shall be determined by the Board in good faith.
"Receivable" means a right to receive payment arising from a sale or
lease of goods or services by a Person pursuant to an arrangement with another
Person pursuant to which such other Person is obligated to pay for goods or
services under terms that permit the purchase of such goods and services on
credit, as determined in accordance with GAAP.
"Receivables Entity" means (x) any Receivables Subsidiary or (y) any
other Person that is engaged in the business of acquiring, selling, collecting,
financing or refinancing Receivables, accounts (as defined in the Uniform
Commercial Code as in effect in any jurisdiction from time to time), other
accounts and/or other receivables, and/or related assets.
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"Receivables Fees" means distributions or payments made directly or
by means of discounts with respect to any participation interest issued or sold
in connection with, and other fees paid to a Person that is not a Restricted
Subsidiary of NAVL in connection with, any Receivables Financing.
"Receivables Financing" means any financing of Receivables of the
Company or any Restricted Subsidiary that have been transferred to a Receivables
Entity in a Financing Disposition.
"Receivables Subsidiary" means a Subsidiary of the Company that (a)
is engaged solely in the business of acquiring, selling, collecting, financing
or refinancing Receivables, accounts (as defined in the Uniform Commercial Code
as in effect in any jurisdiction from time to time) and other accounts and
receivables (including any thereof constituting or evidenced by chattel paper,
instruments or general intangibles), all proceeds thereof and all rights
(contractual and other), collateral and other assets relating thereto, and any
business or activities incidental or related to such business, and (b) is
designated as a "Receivables Subsidiary" by the Board.
"Receivables Repurchase Obligation" means any obligation of a seller
of receivables to repurchase receivables (including Receivables, accounts (as
defined in the Uniform Commercial Code as in effect in any jurisdiction from
time to time) and other accounts and receivables (including any thereof
constituting or evidenced by chattel paper, instruments or general intangibles))
arising as a result of a breach of a representation, warranty or covenant or
otherwise, including as a result of a receivable or portion thereof becoming
subject to any asserted defense, dispute, off-set or counterclaim of any kind as
a result of any action taken by, any failure to take action by or any other
event relating to the seller.
"Redemption Date" with respect to any Debentures, means the date on
which such Debentures are redeemed by the Company.
"Redemption Notice" has the meaning specified in Section 7.3.
"refinance" means refinance, refund, replace, renew, repay, modify,
restate, defer, substitute, supplement, reissue, resell or extend (including
pursuant to any defeasance or discharge mechanism); and the terms "refinances,"
"refinanced" and "refinancing" as used for any purpose in this Debenture
Certificate shall have a correlative meaning.
"Refinancing Indebtedness" means Indebtedness that is Incurred to
refinance any Indebtedness existing on the Issue Date or Incurred in compliance
with this
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Debenture Certificate (including Indebtedness of the Company that refinances
Indebtedness of any Restricted Subsidiary (to the extent permitted in this
Debenture Certificate) and Indebtedness of any Restricted Subsidiary that
refinances Indebtedness of another Restricted Subsidiary) including Indebtedness
that refinances Refinancing Indebtedness; provided, that (1) if the Indebtedness
being refinanced is Junior Securities, the Refinancing Indebtedness has an
Average Life at the time such Refinancing Indebtedness is Incurred that is equal
to or greater than the Average Life of the Indebtedness being refinanced, (2)
such Refinancing Indebtedness is Incurred in an aggregate principal amount (or
if issued with original issue discount, an aggregate issue price) that is equal
to or less than the sum of (x) the aggregate principal amount (or if issued with
original issue discount, the aggregate accreted value) then outstanding of the
Indebtedness being refinanced, plus (y) fees, underwriting discounts, premiums
and other costs and expenses incurred in connection with such Refinancing
Indebtedness and (3) Refinancing Indebtedness shall not include Indebtedness of
the Company or a Restricted Subsidiary that refinances indebtedness of an
Unrestricted Subsidiary.
"Related Business" means those businesses in which the Company or
any of its Subsidiaries is engaged on the Issue Date, or that are related,
complementary, incidental or ancillary thereto or extensions, developments or
expansions thereof.
"Related Dividends" has the meaning set forth in Section 3.4.
"Residual Principal" has the meaning set forth in Section 3.4.
"Resolution" has the meaning specified in the recitals of the
Certificate of Designation.
"Restricted Subsidiary" means any Subsidiary of the Company (or in
the case of NAVL, of NAVL) other than an Unrestricted Subsidiary of such Parent.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Credit Agreement" means the credit agreement dated as of the
Issue Date, 1999, among NAVL, any other Subsidiaries of the Company party
thereto from time to time, the banks and other financial institutions party
thereto from time to time, Banc of America Securities LLC, as syndication agent,
and The Chase Manhattan Bank as collateral agent and administrative agent, as
such agreement may be assumed by any successor in interest, and as such
agreement may be amended, supplemented, waived or otherwise modified from time
to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time (whether in whole or in part,
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whether with the original agent and lenders or other agents and lenders or
otherwise, and whether provided under the original Senior Credit Agreement or
otherwise).
"Senior Credit Facility" means the collective reference to the
Senior Credit Agreement, any Loan Documents (as defined therein), any notes and
letters of credit issued pursuant thereto and any guarantee and collateral
agreement, patent and trademark security agreement, mortgages, letter of credit
applications and other guarantees, pledge agreements, security agreements and
collateral documents, and other instruments and documents, executed and
delivered pursuant to or in connection with any of the foregoing, in each case
as the same may be amended, supplemented, waived or otherwise modified from time
to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time (whether in whole or in part, whether
with the original agent and lenders or other agents and lenders or otherwise,
and whether provided under the original Senior Credit Agreement or one or more
other credit agreements, indentures (including the Indenture) or financing
agreements or otherwise). Without limiting the generality of the foregoing, the
term "Senior Credit Facility" shall include any agreement (i) changing the
maturity of any Indebtedness incurred thereunder or contemplated thereby, (ii)
adding Subsidiaries of the Company as additional borrowers or guarantors
thereunder, (iii) increasing the amount of Indebtedness incurred thereunder or
available to be borrowed thereunder or (iv) otherwise altering the terms and
conditions thereof.
"Senior Discount Notes" means (1) the Indebtedness of the Company
under the Senior Discount Loan Agreement, with an initial accreted value of
$35.0 million in the aggregate. and (2) the 16% Senior Discount Notes of the
Company due 2009 issued or to be issued under the Senior Discount Note
Indenture, in exchange or substitution for Indebtedness under the Senior
Discount Loan Agreement, together with any Exchange Notes (as defined in the
Senior Discount Note Indenture) and any Additional Notes.
"Senior Discount Loan Agreement" means the Loan Agreement, dated as
of the Issue Date, among the Company and Blue Ridge investments, LLC and The
Chase Manhattan Bank, N A. as initial Lenders thereunder, as such Loan Agreement
may be amended, supplemented, waived or otherwise modified from time to time, or
refunded, refinanced, restructured, replaced, renewed, repaid, increased or
extended from time to time (whether in whole or in part, and whether provided
under the original Loan Agreement or one or more other credit agreements,
indentures or financing agreements or otherwise).
"Senior Discount Note Indenture" means the Indenture between the
Company and the relevant Trustee, pursuant to which Senior Discount Notes are
issued,
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as such Indenture may be amended, supplemented, waived or otherwise modified
from time to time, or refunded, refinanced, restructured, replaced, renewed,
repaid, increased or extended from time to time (whether in whole or in part,
and whether provided under the original Senior Discount Note indenture or one or
more other credit agreements, indentures or financing agreements or otherwise).
"Senior Indebtedness" means the following obligations, whether
outstanding on the date of this Debenture or thereafter issued:
(i) the Designated Senior Indebtedness;
(ii) all obligations consisting of the principal of and premium, if
any, and accrued and unpaid interest (including interest accruing on or
after the filing of any petition in bankruptcy or for reorganization
relating to the Company regardless of whether post-filing interest is
allowed in such proceeding) in respect of (A) all other Indebtedness of
the Company or (B) all Indebtedness evidenced by notes, debentures, bonds
or other similar instruments for the payment of which the Company is
responsible or liable.
(iii) all Capital Lease Obligations of the Company;
(iv) all obligations of the Company (A) for the reimbursement of any
obligor on any letter of credit, banker's acceptance or similar credit
transaction, (B) under Interest Rate Agreements and Currency Hedging
Arrangements or (C) issued or assumed as the deferred purchase price of
property and all conditional sale obligations of the Company and all
obligations of the Company under any title retention agreement;
(v) all obligations of other Persons of the type referred to in
clauses (i), (ii) (iii) and (iv) and all dividends of other Persons for
the payment of which, in either case, the Company is responsible or
liable, directly or indirectly, as obligor, guarantor or otherwise,
including guarantees of such obligations and dividends; and
(vi) all obligations of the Company consisting of modifications,
renewals, extensions, replacements, refinancings and refundings of any
obligations described in clauses (i), (ii), (iii), (iv) or (v);
unless, in the instrument creating or evidencing the same or pursuant to which
the same is outstanding, it is expressly provided that such obligations are not
superior in right of payment to this Note; provided, however, that Senior
Indebtedness shall not include (1)
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Debentures or any other junior subordinated exchange debentures of the Company
issued on the date hereof of identical terms as this Debenture (or other
debentures of like terms issued by the Company in exchange for such debentures
(upon a transfer or otherwise) or in lieu of a payment in cash pursuant to
Article 1 or Article 4 of such debentures, (2) any accounts payable or other
liability to trade creditors arising in the ordinary course of business
(including Guarantees thereof or instruments evidencing such liabilities) or (3)
any Capital Stock of the Company.
"Senior Securities" has the meaning specified in paragraph (b)(iii)
of the Certificate of Designation.
"Significant Subsidiary" means any Restricted Subsidiary that would
be a "significant subsidiary" of the Company within the meaning of Rule 1-02
under Regulation S-X promulgated by the SEC, as in effect on the Issue Date.
"S&P" means Standard & Poor's Ratings Service, a division of The
McGraw-Hill Companies, Inc., and its successors.
"Special Redemption Price" has the meaning specified in Section
7.1(b).
"Standard Receivable Obligations" means representations, warranties,
covenants, indemnities and other obligations (including Guarantees and
Indebtedness) that are reasonably customary in connection with a Financing
Disposition (as determined by the Company in good faith), including, without
limitation, those relating to the servicing of the assets of a Receivables
Entity, it being understood that any Receivables Repurchase Obligation shall be
deemed to be a Standard Receivable Obligation.
"Stated Amount" means, as to any Debenture at any time, (A) with
respect to any Dividend Payment Date, the "Stated Amount," as defined in the
Certificate of Designation, of the Junior Preferred Stock for which such
Debenture was exchanged as of such time, and (B) with respect to any Interest
Payment Date, the sum of: (i) the Principal Amount of such Debenture as of such
time, plus (ii) the amount of any accrued and unpaid interest with respect to
such Debenture.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing for the repurchase
of such security at the option of the holder thereof upon the happening of any
contingency).
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"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital Stock or other equity interests (including
partnership interests) entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time owned or controlled, directly or indirectly, by (i) such person
or (ii) one or more Subsidiaries of such Person.
"Successor Company" has the meaning specified in Section 6.1.
"Trade Payables" means, with respect to any Person, any accounts
payable or any indebtedness or monetary obligation to trade creditors created,
assumed or guaranteed by such Person arising in the ordinary course of business
in connection with the acquisition of goods or services.
"Transactions" means, collectively, the Allied Acquisition, the
offering and issuance of the Notes and the Senior Discount Notes, the initial
borrowings under the Senior Credit Facility and the Interim Loan Facility, the
issuance by the Company of Capital Stock as part of the consideration for the
Allied Acquisition, and all other related transactions.
"Transfer" unless the context otherwise requires, any sale,
assignment, pledge or other disposition of any security, or of any interest
therein, which could constitute a "sale" as that term is defined in Section 2(3)
of the Securities Act.
"Unrestricted Subsidiary" means for the Company or NAVL,
respectively, (i) any Subsidiary of such Parent that at the time of
determination is an Unrestricted Subsidiary, as designated by the Board in the
manner provided below, and (ii) any Subsidiary of an Unrestricted Subsidiary of
such Parent. The Board may designate any Subsidiary of such Parent (including
any newly acquired or newly formed Subsidiary of such Parent) to be an
Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns
any Capital Stock or Indebtedness of, or owns or holds any Lien on any property
of, NAVL or any other Restricted Subsidiary of NAVL that is not a Subsidiary of
the Subsidiary to be so designated. The Board may designate any Unrestricted
Subsidiary of such Parent to be a Restricted Subsidiary of such Parent;
provided, that immediately after giving effect to such designation either (x)
the Company or NAVL could incur at least $1.00 of additional Indebtedness under
paragraph 6.2(A) or (y) the Consolidated Coverage Ratio of the Company or NAVL
would be greater than it was immediately prior to giving effect to such
designation. Any such designation by the Board shall be evidenced by an
Officer's Certificate certifying that such designation complied with the
foregoing provisions.
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"Voting Stock" of an entity means all classes of Capital Stock of
such entity then outstanding and normally entitled to vote in the election of
directors or all interests in such entity with the ability to control the
management or actions of such entity.
ARTICLE 3
PAYMENTS
Section 3.1 Payments. (a) Subject to Article 4 and to the extent
permitted by the Senior Indebtedness, the Company will pay all sums becoming due
on this Debenture by the method and at the address specified for such purpose in
Section 3.1(b) without the presentation or surrender of this Debenture or,
subject to the next sentence, the making of any notation hereon, except that, if
paid in full, this Debenture shall be surrendered to the Company as a condition
to such payment and shall be cancelled and shall not be reissued. Upon any
partial prepayment of this Debenture, the Holder shall endorse hereon the amount
and date of such partial prepayment, provided that the Holder's failure to do so
shall not affect the Company's obligations under this Debenture.
(b) All cash payments due hereunder shall be made by (i) check
mailed to the principal office of the Holder in set forth in Section 8.6 (or
such other location of its principal office from tune to time) or (ii) wire
transfer of immediately available funds prior to 1:00 p.m., New York City time,
on the due date for payment thereof to such bank account as shall be designated
by the Holder to the Company in writing at least five (5) Business Days prior to
the due date for such payment. Any cash payment due hereunder on a day that is
not a Business Day shall be made on the first Business Day following the due
date for such payment.
(c) The Company shall have the right to prepay this Debenture in
full or in part as hereinafter provided in Article 7.
Section 3.2 Nothing herein contained shall in any way or under any
circumstances be construed or deemed to require the Company to pay or set apart
for payment any cash interest on Debentures at any time.
Section 3.3 Accrued Interest may be paid at any time, without
reference to any regular Interest Payment Date, to the Holders of record on such
date, not more than 45 days prior to the payment thereof, as may be fixed by the
Board of Directors.
Section 3.4 No full dividends shall be declared by the Board of
Directors or paid or funds set apart for payment of dividends by the Company on
any Parity Securities for any period (A) during which a Mandatory Redemption
Event exists and (B)
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unless all accrued interest (and accumulated and unpaid dividends on the Junior
Preferred Stock for which such Debentures were exchanged ("Related Dividends")
(or Principal Amount in respect thereof ("Residual Principal")) shall have been
or contemporaneously are paid in full, or a sum in cash set apart sufficient for
such payment, on the Debentures (and in respect of Junior Preferred Stock for
which the Debentures were exchanged) for all Interest Periods and Dividend
Periods terminating on or prior to the date of payment of such full dividends on
such Parity Securities. If any interest or Related Dividends or Residual
Principal are not paid in full, as aforesaid, upon the Debentures (including for
this purpose in respect of any related Junior Preferred Stock for which such
debentures were exchanged) and any other Parity Securities, all interest and
dividends and Related Principal declared and paid upon the Debentures (including
in respect of such Junior Preferred Stock) and any other Parity Securities shall
be declared pro rata so that the amount of interest and dividends and Related
Principal declared and paid upon the Debentures (including in respect of such
Junior Preferred Stock) and such Parity Securities shall in all cases bear to
each other the same ratio that accrued interest and dividends and Related
Principal per Debentures (including in respect of such Junior Preferred Stock)
and such Parity Securities bear to each other.
Section 3.5 (a) The Holders of Debentures shall be entitled to
receive accrued interest in preference to and in priority over any dividends
upon any of the Junior Securities, as and to the extent provided in Sections 3.6
and 3.7.
(b) So long as any Debentures are outstanding, the Company shall not
declare, pay or set apart for payment any dividend on any of the Junior
Securities, or make any distribution in respect thereof, for (1) any period
during which a Mandatory Redemption Event or Interest Default exists and (2) any
period prior to a Public Offering unless all accrued interest (and any Related
Dividends or Residual Principal) shall have been or contemporaneously are paid
in full, or a sum in cash set apart sufficient for such payment, on the
Debentures (and in respect of Junior Preferred Stock for which the Debentures
were exchanged) for all Interest Periods and Dividend Periods terminating on or
prior to the date of payment of such dividends on such Junior Securities.
Section 3.6 At any time that an Interest Default or Mandatory
Redemption Event exists, so long as any Debentures are outstanding, the Company
shall not make any payment on account of, or set apart for payment money for a
sinking or other similar fund for, the purchase, redemption or other retirement
of any of the Junior Securities or any warrants, rights, calls or options
exercisable for or convertible into any of the Junior Securities, either
directly or indirectly, and whether in cash, obligations or shares of the
Company or other property, and shall not permit any corporation or other entity
directly or indirectly controlled by the Company to purchase or redeem any of
the Junior Securities or any such warrants. rights, calls or options.
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Section 3.7 At any time that a Interest Default or Mandatory
Redemption Event exists, so long as any Debentures are outstanding, the Company
shall not make any payment on account of, or set apart for payment money for a
sinking or other similar fund for, the purchase, redemption or other retirement
of, any of the Parity Securities or any warrants, rights, calls or options
exercisable for or convertible into any of the Parity Securities, and shall not
permit any corporation or other entity directly or indirectly controlled by the
Company to purchase or redeem any of the Parity Securities or any such warrants,
rights, calls or options.
ARTICLE 4
SUBORDINATION
Section 4.1 Agreement To Subordinate. The Company agrees and, by
accepting this Debenture, the Holder acknowledges and agrees that the
Indebtedness evidenced by this Debenture is subordinated in right of payment, to
the extent and in the manner provided in this Article 4, to the prior payment in
full of all Senior Indebtedness and that the subordination is for the benefit of
and enforceable by the holders of Senior Indebtedness.
Section 4.2 Additional Debentures. Without limiting the provisions
regarding interest payments in Article 1, unless and until the Senior
Indebtedness shall have been fully and indefeasibly paid and satisfied in cash,
the Company at its option may pay any amounts due hereunder in additional
Debentures.
Section 4.3 Designated Senior Indebtedness. (a) Except as set forth
in clause (b) below, the Holder will not accelerate, ask, demand, sue for, take
or receive from the Company, by set off or in any other manner, the whole or any
part of the principal of, or premium, if any, on this Debenture, including
without limitation the taking of any negotiable instruments evidencing such
amounts, nor any security for any such amounts (other than additional
Debentures), unless and until all of the Designated Senior Indebtedness shall
have been fully and indefeasibly paid and satisfied in cash.
(b) Prior to the occurrence of a default with respect to any
Designated Senior Indebtedness, and provided that the payment described below,
if made, would be permitted to be made under all Senior Indebtedness, the
Company may pay to the Holder, and the Holder may accept from the Company,
regularly scheduled payments of interest, when due, on an unaccelerated basis,
pursuant to this Debenture.
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Section 4.4 Liquidation, Dissolution, Bankruptcy. Upon any payment
or distribution of the assets of the Company to creditors upon a total or
partial liquidation or a total or partial dissolution of the Company or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the Company or its property:
(i) holders of Senior Indebtedness shall be entitled to receive
payment in full in cash of the Senior Indebtedness before the
Holder shall be entitled to receive any payment of principal
of, or premium, if any, or interest on this Debenture; and
(ii) until the Senior Indebtedness is paid in full in cash, any
payment or distribution to which the Holder would be entitled
but for this Article 4 shall be made to holders of Senior
Indebtedness as their interests may appear.
Section 4.5 Default on Senior Indebtedness. Without limiting the
provisions regarding Designated Senior Indebtedness in Section 4.3, the Company
may not pay the principal of, premium, if any, or interest on, this Debenture or
otherwise purchase or retire this Debenture (collectively, "pay this Debenture")
if (i) any Senior Indebtedness is not paid when due, (ii) the maturity of such
Senior Indebtedness is accelerated in accordance with its terms or (iii) any
default exists under any Senior Indebtedness.
Section 4.6 Acceleration of Payment of Debenture. Except as
permitted by any Senior Indebtedness, the Holder will not accelerate for any
reason the scheduled maturities of any amount owing in respect of this Debenture
or the indebtedness which it represents.
Section 4.7 When Distribution Must Be Paid Over. If a distribution
is made to the Holder that because of this Article 4 should not have been made
to it, the Holder agrees, by accepting this Debenture, that it shall hold such
distribution in trust for holders of Senior Indebtedness and pay it over to them
as their interests may appear.
Section 4.8 Subrogation. After all Senior Indebtedness is paid in
full in cash and until this Debenture is paid in full, the Holder shall be
subrogated to the rights of holders of Senior Indebtedness to receive
distributions applicable to Senior Indebtedness. A distribution made under this
Article 4 to holders of Senior Indebtedness which otherwise would have been made
to the Holder is not, as between the Company and the Holder, a payment by the
Company on Senior Indebtedness.
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Section 4.9 Relative Rights. This Article 4 defines the relative
rights of the Holder and holders of Senior Indebtedness. Nothing in this
Debenture shall:
(i) impair, as between the Company and the Holder, the obligation
of the Company, which is absolute and unconditional, to pay
principal of, premium, if any, and interest on this Debenture
in accordance with its terms; or
(ii) prevent the Holder from exercising its available remedies upon
a Default, subject to any provisions of Senior Indebtedness
relating thereto.
Section 4.10 Subordination May Not Be Impaired by Company. No right
of any holder of Senior Indebtedness to enforce the subordination of the
Indebtedness evidenced by this Debenture shall be impaired by any act or failure
to act by the Company or by its failure to comply with this Debenture.
Section 4.11 Reliance by Holders of Senior Indebtedness on
Subordination Provisions. The Holder by accepting this Debenture acknowledges
and agrees that the foregoing subordination provisions are, and are intended to
be, an inducement and a consideration to each holder of any Senior Indebtedness,
whether such Senior Indebtedness was created or acquired before or after the
issuance of this Debenture, to acquire and continue to hold, or to continue to
hold, such Senior Indebtedness and such holder of Senior Indebtedness shall be
deemed conclusively to have relied on such subordination provisions in acquiring
and continuing to hold, or in continuing to hold, such Senior Indebtedness.
ARTICLE 5
DEFAULTS AND REMEDIES
Section 5.1 Events of Default. An "Event of Default" occurs if:
(a) the Company defaults in any payment of interest on any Debenture
when due, whether or not such payment shall be prohibited by Article 4,
and such default continues for a period of 30 days;
(b) the Company defaults in the payment of the principal of any
Debenture when the same becomes due at its Stated Maturity, upon optional
redemption, upon required purchase, upon declaration of acceleration or
other-
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wise, whether or nor such payment shall be prohibited by Article 4;
(c) the Company fails to comply with Section 6.1 and such failure
continues for 30 days after the notice specified in the penultimate
paragraph of this Section 5.1;
(d) the Company fails to comply with Section 7.4 (other than a
failure to purchase the Debentures), and such failure continues for 30
days alter the notice specified in the penultimate paragraph of this
Section 5.1;
(e) the Company fails to comply with any of its agreements in this
Debenture Certificate (other than those referred to in (a), (b), (c) and
(d) above) and such failure continues for 60 days after the notice
specified in the penultimate paragraph of this Section 5.1;
(f) the Company or any Significant Subsidiary fails to pay any
Indebtedness within any applicable grace period after final maturity or
the acceleration of any such Indebtedness by the holders thereof because
of a default if the total amount of such Indebtedness unpaid or
accelerated exceeds $15,000,000 or its foreign currency equivalent;
(g) the Company or any Significant Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:
(1) commences a voluntary case;
(2) consents to the entry of an order for relief against it in
an involuntary case;
(3) consents to the appointment of a Custodian of it or for
any substantial part of its property; or
(4) makes a general assignment for the benefit of its
creditors;
(h) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(1) is for relief against the Company or any Significant
Subsidiary in an involuntary case;
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(2) appoints a Custodian of the Company or any Significant
Subsidiary or for any substantial part of its property; or
(3) orders the winding up or liquidation of the Company or any
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 days; or
(i) there is rendered any judgment or decree for the payment of
money in an amount (net of any insurance or indemnity payments actually
received within 90 days from the entry thereof, or to be received in
respect thereof in the event any appeal thereof shall be unsuccessful) in
excess of $15,000,000 or its foreign currency equivalent against the
Company or any Significant Subsidiary by a court or other adjudicatory
authority of competent jurisdiction that is not discharged, or bonded or
insured by a third Person, if such judgment or decree remains outstanding
for a period of 90 days following such judgment or decree and is not
discharged, waived or stayed.
The foregoing will constitute Events of Default whatever the reason
for any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means Title 11, United States Code, or any
similar Federal, state or foreign law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
A Default under clause (c), (d) or (e) is not an Event of Default
until the Holders of at least 25% in principal amount of the Debentures notify
the Company of the Default and the Company does not cure such Default within the
time specified therein after receipt of such notice. Such notice must specify
the Default, demand that it be remedied and state that such notice is a "Notice
of Default." When a Default or an Event of Default is cured, it ceases.
The Company shall deliver to the Holders, within 30 days after the
occurrence thereof, written notice in the form of an Officer's Certificate of
any Event of Default under clause (f) or (i) and any event that with the giving
of notice or the
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lapse of time would become an Event of Default under clause (c), (d) or (e), its
status and what action the Company is taking or proposes to take with respect
thereto.
Section 5.2 Acceleration of Maturity; Rescission and Annulment. If
an Event of Default (other than an Event of Default specified in clause (g) or
(h) of Section 5.1 with respect to the Company) occurs and is continuing, the
Holders of at least a majority in principal amount of the outstanding Debentures
by notice to the Company, specifying in such notice the respective Event of
Default and that such notice is a "notice of acceleration," may, but only in the
event that all Designated Senior Indebtedness shall first have been paid in
full, declare the principal of and accrued but unpaid interest on all the Notes
to be due and payable. Upon the effectiveness of such a declaration, such
principal and interest will be due and payable immediately. Notwithstanding the
foregoing, if an Event of Default specified in clause (g) or (h) of Section 5.1
with respect to the Company occurs and is continuing, then the principal of and
any accrued interest on all the outstanding Debentures will ipso facto become
and be immediately due and payable without any declaration or other act on the
part of any Holder. The Holders of a majority in principal amount of the
outstanding Debentures by notice to the Company may rescind an acceleration and
its consequences if the rescission would not conflict with any judgment or
decree and if all existing Events of Default have been cured or waived except
non-payment of principal or interest that has become due solely because of such
acceleration. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.
Notwithstanding the foregoing, in the event of a declaration of
acceleration in respect of the Notes because an Event of Default specified in
clause (f) of Section 5.1 shall have occurred and be continuing, such
declaration of acceleration of the Debentures and such Event of Default and all
consequences thereof (including without limitation any acceleration or resulting
payment default) shall be annulled, waived and rescinded, automatically and
without any action by the Holders, and be of no further effect, if within 60
days after such Event of Default arose (x) the Indebtedness that is the basis
for such Event of Default has been discharged, or (y) the holders thereof have
rescinded or waived the acceleration, notice or action (as the case may be)
giving rise to such Event of Default, or (z) the default in respect of such
Indebtedness that is the basis for such Event of Default has been cured.
Section 5.3 Other Remedies. If an Event of Default occurs and is
continuing, and irrespective of whether any Debentures have become or have been
declared immediately due and payable under Section 5.2, the Holder of any
Debenture then outstanding may, but only in the event that all Designated Senior
Indebtedness shall first have been paid in full, proceed to pursue any
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available remedy to collect the payment of principal of or interest on the
Debentures or to enforce the performance of any provision of the Debentures or
this Debenture Certificate.
Section 5.4 Application of Money Collected. Any money collected by
any Holder pursuant to this Article 5 shall be applied in the following order,
and, in case of the distribution of such money on account of principal (or
premium, if any) or interest, upon presentation of the Debentures and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
First: to holders of Senior Indebtedness to the extent required by
Article 4.
Second: to the payment of the amounts then due and unpaid upon the
Debentures for principal (and premium, if any) and interest, in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due
and payable on such Notes for principal (and premium, if any) and
interest, respectively; and
Third: to the Company.
Section 5.5 Rights and Remedies Cumulative. No right or remedy
herein conferred upon or reserved to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
Section 5.6 Delay or Omission Not Waiver. No delay or omission of
any Holder of any Debenture to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or constitute a waiver of
any such Event of Default or an acquiescence therein. Every right and remedy
given by this Article 5 or by law to the Holders may be exercised from time to
time, and as often as may be deemed expedient by the Holders, but only in the
event that all Designated Senior Indebtedness shall first have been paid in
full.
Section 5.7 Waiver of Past Defaults. The Holders of not less than a
majority in aggregate principal amount of the outstanding Debentures may on
behalf of
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the Holders of all the Debentures waive any past Default hereunder and its
consequences, except a Default
(a) in the payment of the principal of (or premium, if any) or
interest on any Debenture (which may only be waived with the consent of
each Holder of Debentures affected), or
(b) in respect of a covenant or provision hereof that pursuant to
the second paragraph of Section 8.4(b) cannot be modified or amended
without the consent of the Holder of each outstanding Debenture affected.
Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Debenture Certificate: but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereon. In case of any such waiver, the Company, any other obligor upon the
Debentures and the Holders shall be restored to their former positions and
rights hereunder and under the Debentures, respectively.
ARTICLE 6
COVENANTS
Section 6.1 Merger or Consolidation. (A) Without the consent of the
Holders of a majority of the outstanding aggregate Principal Amount of
Debentures (including consents obtained in connection with a tender offer or
exchange offer for the Debentures) (the "Majority Holders"), the Company will
not consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person, unless: (1) the resulting,
surviving or transferee Person (the "Successor Company") will be a Person
organized and existing under the laws of the United States of America, any State
thereof or the District of Columbia and the Successor Company (if not the
Company) will expressly assume all the obligations of the Company under the
Debentures and this Agreement by executing and delivering to the Holders a
supplemental agreement or one or more other documents or instruments in form
reasonably satisfactory to the Holders; (2) immediately after giving effect to
such transaction (and treating any Indebtedness that becomes an obligation of
the Successor Company or any Restricted Subsidiary as a result of such
transaction as having been Incurred by the Successor Company or such Restricted
Subsidiary at the time of such transaction) no Mandatory Redemption Event will
have occurred and be continuing, and (4) the Company will have obtained an
Officer's Certificate and an Opinion of Counsel, each to the effect that such
consolidation, merger
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or transfer complies with this paragraph 6.1(A), provided that (x) in giving
such opinion such counsel may rely on an Officer's Certificate as to compliance
with the foregoing clauses (2) and (3) and as to any matters of fact, and (y) no
Opinion of Counsel will be required for a consolidation, merger or transfer
described in paragraph 6.1(B) below. Any Indebtedness that becomes an obligation
of the Company or any Restricted Subsidiary (or that is deemed to be Incurred by
any Restricted Subsidiary that becomes a Restricted Subsidiary) as a result of
any such transaction undertaken in compliance with this Section 6.1, and any
Refinancing Indebtedness with respect thereto, shall be deemed to have been
Incurred in compliance with Section 6 3.
(B) Paragraph 6.1(A) above shall not apply to any transaction in
which (1) any Restricted Subsidiary consolidates with, merges into or transfers
all or part of its assets to the Company or (2) the Company consolidates or
merges with or into or transfers all or substantially all its properties and
assets to (x) an Affiliate incorporated or organized for the purpose of
reincorporating or reorganizing the Company in another jurisdiction or changing
its legal structure to a corporation or other entity or (y) a Restricted
Subsidiary of the Company so long as all assets of the Company and the
Restricted Subsidiaries immediately prior to such transaction (other than
Capital Stock of such Restricted Subsidiary) are owned by such Restricted
Subsidiary and its Restricted Subsidiaries immediately after the consummation
thereof.
(D) Successor Company Substituted. Upon any transaction involving
the Company in accordance with Section 6.1(A)-(C), in which the Company is not
the Successor Company, the Successor Company will succeed to, and be substituted
for, and may exercise every right and power of, the Company under this Debenture
Certificate, and thereafter the predecessor Company shall be relieved of all
obligations and covenants under this Debenture Certificate.
Section 6.2 Junior Payments. (A) Without the consent of the Majority
Holders, the Company shall not, and shall not permit any Restricted Subsidiary,
directly or indirectly, to (i) declare or pay any dividend or make any
distribution on or in respect of any Junior Securities of the Company, including
any such payment in connection with any merger or consolidation to which the
Company is a party, except (x) dividends or distributions payable solely in its
Capital Stock (other than Disqualified Stock) and (y) dividends or distributions
payable to the Company or any Restricted Subsidiary, or (ii) purchase, redeem,
retire or otherwise acquire for value, prior to scheduled maturity, scheduled
repayment or scheduled sinking fund payment, any Junior Securities of the
Company held by Persons other than the Company or any Restricted Subsidiary
(other than a purchase, redemption, retirement, or other acquisition for value
in anticipation of satisfying a sinking fund obligation, principal installment
or final maturity, in each case due within one year of the date of such
acquisition) (any such dividend, distribution, purchase,
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redemption, retirement or other acquisition being herein referred to as a
"Junior Payment"), if at the time the Company or such Restricted Subsidiary
makes such Junior Payment;
(1) a Mandatory Redemption Event shall have occurred and be
continuing (or would result therefrom);
(2) NAVL could not incur at least an additional $1.00 of
Indebtedness pursuant to paragraph 6.3(A) below; or
(3) the aggregate amount of such Junior Payment and all other Junior
Payments (the amount so expended, if other than in cash, to be as
determined in good faith by the Board, whose determination shall be
conclusive) declared or made subsequent to the Issue Date and then
outstanding would exceed the sum of:
(a) 50% of the Consolidated Net Income of the Company or (if
greater) of NAVL accrued during the period (treated as one
accounting period) from September 30, 1999 to the end of the most
recent fiscal quarter ending prior to the date of such Junior
Payment for which consolidated financial statements of the Company
or NAVL, as the case may be, are available (or, in case each such
Consolidated Net Income shall be a negative number, 100% of the
smaller such negative number); and
(b) the aggregate Net Cash Proceeds and the fair market value
of Qualified Proceeds received (x) by the Company as capital
contributions to the Company after the Issue Date or from the
issuance or sale (other than to a Restricted Subsidiary) of its
Capital Stock (other than Disqualified Stock) after the Issue Date
or (y) by the Company or any Restricted Subsidiary from the issuance
and sale by the Company or any Restricted Subsidiary after the Issue
Date of Indebtedness that shall have been converted into or
exchanged for Capital Stock of the Company (other than Disqualified
Stock), plus the amount of cash and the fair market value of
Qualified Proceeds received by the Company or any Restricted
Subsidiary upon such conversion or exchange.
(B) The provisions of the foregoing paragraph 6.2(A) will not
prohibit any of the following (each, a "Permitted Payment"):
(1) any purchase, redemption, retirement or other acquisition of
Capital Stock of the Company made by exchange (including any such exchange
pursuant to the exercise of a conversion right or privilege in connection
with which cash is
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paid in lieu of the issuance of fractional shares) for, or conversion
into, or out of the proceeds of the substantially concurrent issuance or
sale of, Capital Stock of the Company (other than Disqualified Stock and
other than Capital Stock issued or sold to a Subsidiary) or out of the
proceeds of a substantially concurrent capital contribution to the
Company; provided, that the Net Cash Proceeds from such issuance, sale or
capital contribution shall be excluded in subsequent calculations under
clause (3)(b) of the preceding paragraph 6.2(A);
(2) any purchase, redemption, retirement or other acquisition of
Junior Securities (x) made by exchange for, or out of the proceeds of the
substantially concurrent issuance or sale of, Refinancing Indebtedness
Incurred in compliance with Section 6.3 below or (y) to the extent
required by the agreement governing such Junior Securities following the
occurrence of a Change of Control, but only if in each case, the Company
shall have complied with Section 7.4 and, if required, purchased
Debentures tendered pursuant to an Offer to purchase such Debentures
required thereby, prior to purchasing or repaying such Junior Securities;
(3) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividend would have complied
with the preceding paragraph 6.2(A);
(4) payments to repurchase or otherwise acquire Capital Stock
(including any options, warrants or other rights in respect thereof), in
each case from Management Investors, such payments not to exceed an amount
(net of repayments of any such loans or advances equal to (a) $12.5
million plus (b) $2.5 million multiplied by the number of calendar years
that have commenced since the Issue Date plus (c} the Net Cash Proceeds
received by the Company or NAVL since the Issue Date from, or as a capital
contribution from, the issuance or sale of Capital Stock (including any
options, warrants or other rights in respect thereof), to the extent such
Net Cash Proceeds are not included in any calculation under clause
(3)(b)(x) of the preceding paragraph 6.2(A);
(5) the payment of dividends on the common stock or equity of the
Company following a public offering of such common stock or equity, in an
amount not to exceed in any fiscal year 6% of the aggregate gross proceeds
received by the Company in or from such public offering;
(6) Junior Payments (including loans or advances) in an aggregate
amount outstanding at any time not to exceed $10.0 million (net of
repayments of any such loans or advances);
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(7) payments to satisfy obligations under the Management Agreements
to pay any Holding Expenses;
(8) payments to holders of Capital Stock of the Company in lieu of
issuance of fractional shares of such Capital Stock, not to exceed
$100,000 in the aggregate outstanding at any time;
(9) the distribution, as a dividend or otherwise, of Investments in
Unrestricted Subsidiaries;
(10) the Transactions;
(11) any purchase, redemption, retirement or other acquisition of
Capital Stock that may be deemed to occur upon exercise of stock options,
warrants or similar rights to the extent such Capital Stock represents all
or part of the exercise price thereof; and
(12) Junior Payments by any Restricted Subsidiary that are permitted
by the Senior Credit Facility or any Indenture;
provided, that (A) in the case of clauses (3) and (5), the net amount of any
such Permitted Payment shall be included in subsequent calculations of the
amount of Junior Payments, (B) in the case of clause (4), 50% of the amount of
any such Permitted Payment shall be included in subsequent calculations of the
amount of Junior Payments, (C) in the case of clause (12), the net amount of any
such Permitted Payment shall be included in subsequent calculations of the
amount of Junior Payments to the extent that such net amount is required under
each Indenture to be included in concurrent calculations of the amount of
Restricted Payments (as defined in such Indenture) under Section 4.08 of the
Note Indenture, Section 4.08 of the Senior Discount Note Indenture and Section
6.7 of the Senior Discount Loan Agreement, (D) in all cases other than pursuant
to clauses (A), (B) and (C) immediately above, the net amount of any such
Permitted Payment shall be excluded in subsequent calculations of the amount of
Junior Payments and (E) with respect to clauses (5) and (6), no Mandatory
Redemption Event shall have occurred or be continuing at the time of any such
Permitted Payment after giving effect thereto.
Section 6.3 Limitation on Indebtedness. (A) Without the consent of
the Majority Holders, the Company will not, and will not permit any Restricted
Subsidiary to, Incur any Indebtedness; provided, however, that (1) the Company
or any Restricted Subsidiary may Incur Indebtedness if on the date of the
Incurrence of such Indebtedness, after giving effect to the Incurrence thereof,
the Consolidated Coverage Ratio of the Company would be greater than 1.75:1.00
if such Indebtedness is Incurred on or prior to
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December 1, 2001 or 2.00:1.00 if such Indebtedness is Incurred thereafter and
(2) NAVL or any Note Guarantor may Incur Indebtedness if on the date of the
Incurrence of such Indebtedness, after giving effect to the Incurrence thereof
the Consolidated Coverage Ratio of NAVL would be greater than 2.00:1.00 if such
Indebtedness is Incurred on or prior to December 1, 2001 or 2.25:1.00 if such
Indebtedness is Incurred thereafter.
(B) Notwithstanding the foregoing paragraph 6.3(A), the Company and its
Restricted Subsidiaries may Incur the following Indebtedness:
(1) Indebtedness Incurred pursuant to Credit Facilities (including
but not limited to in respect of letters of credit or bankers' acceptances
issued or created thereunder) and (without limiting the foregoing) any
Refinancing Indebtedness in respect thereof, in a maximum principal amount
at any time outstanding (giving effect to any refinancing thereof) not
exceeding in the aggregate the amount equal to the sum of (x) $475.0
million and (y) the aggregate amount by which the Borrowing Base
determined as of the date of such Incurrence exceeds $245.0 million (plus
in the case of any refinancing of any Credit Facility or any portion
thereof, the aggregate amount of fees, underwriting discounts, premiums
and other costs and expenses incurred in connection with such
refinancing);
(2) Indebtedness (a) of any Restricted Subsidiary to the Company or
(b) of the Company or any Restricted Subsidiary to any Restricted
Subsidiary; provided, that any subsequent issuance or transfer of any
Capital Stock of such Restricted Subsidiary to which such Indebtedness is
owed, or other event, that results in such Restricted Subsidiary ceasing
to be a Restricted Subsidiary or any other subsequent transfer of such
Indebtedness (except to the Company or a Restricted Subsidiary) will be
deemed, in each case, an Incurrence of such Indebtedness by the issuer
thereof;
(3) Indebtedness represented by the Exchange Debentures, the Notes
and the Senior Discount Notes (other than Additional Notes), any
Indebtedness (other than the Indebtedness described in clauses (1) or (2)
above) outstanding on the Issue Date and any Refinancing Indebtedness
Incurred in respect of any Indebtedness described in this clause (3) or
paragraph 6.3(A) above;
(4) Purchase Money Obligations and Capitalized Lease Obligations,
and any Refinancing Indebtedness with respect thereto, in an aggregate
principal amount at any time outstanding (giving effect to any refinancing
thereof) not exceeding an amount equal to the greater of (x) $35.0 million
and (y) 5% of Consolidated Tangible Assets;
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(5) Indebtedness of any Person that is assumed by the Company or any
Restricted Subsidiary in connection with its acquisition of assets from
such Person or any Affiliate thereof or is issued and outstanding on or
prior to the date on which such Person was acquired by the Company or any
Restricted Subsidiary or merged or consolidated with or into any
Restricted Subsidiary (other than Indebtedness Incurred to finance, or
otherwise in connection with, such acquisition), provided that on the date
of such acquisition, merger or consolidation, after giving effect thereto,
NAVL could Incur at least $1.00 of additional Indebtedness pursuant to
paragraph 6.3(A) above; and any Refinancing Indebtedness with respect to
any such Indebtedness;
(6) (a) Guarantees by the Company or any Restricted Subsidiary of
Indebtedness or any other obligation or liability of the Company or any
Restricted Subsidiary (other than any Indebtedness incurred by the Company
or such Restricted Subsidiary, as the case may be, in violation of this
paragraph 6.3), or (b) Indebtedness of the Company or any Restricted
Subsidiary arising by reason of any Lien granted by or applicable to such
Person securing Indebtedness of the Company or any Restricted Subsidiary
(other than any Indebtedness incurred by the Company or such Restricted
Subsidiary, as the case may be, in violation of this Section 6.3);
(7) Indebtedness of the Company or any Restricted Subsidiary (a)
arising from the honoring of a check, draft or similar instrument of such
Person drawn against insufficient funds, provided that such Indebtedness
is extinguished within five Business Days of its incurrence, or (b)
consisting of guarantees, indemnities, obligations in respect of earnouts
or other purchase price adjustments, or similar obligations, Incurred in
connection with the acquisition or disposition of any business, assets or
Person (including pursuant to the Allied Acquisition);
(8) Indebtedness of the Company or any Restricted Subsidiary in
respect of (a) letters of credit, bankers' acceptances or other similar
instruments or obligations issued, or relating to liabilities or
obligations incurred, in the ordinary course of business (including those
issued to governmental entities in connection with self-insurance under
applicable workers' compensation statutes), or (b) completion guarantees,
surety, judgment, appeal or performance bonds, or other similar bonds,
instruments or obligations, provided, or relating to liabilities or
obligations incurred, in the ordinary course of business, or (c) Hedging
Obligations entered into for bona fide hedging purposes in the ordinary
course of business, (d) Management Guarantees, (e) Agent Guarantees in an
aggregate principal amount not exceeding $10.0 million outstanding at any
time, or (f) the financing of insurance premiums in the ordinary course of
business;
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(9) Indebtedness of a Receivables Subsidiary secured by a Lien on
all or part of the assets disposed of in, or otherwise incurred in
connection with, a Financing Disposition, which Indebtedness is, except
for Standard Receivables Obligations, otherwise without recourse to NAVL
or any Restricted Subsidiary (other than any Receivables Subsidiary);
(10) Indebtedness of a Foreign Subsidiary of the Company or NAVL if,
on the date of Incurrence of such Indebtedness, after giving effect to the
Incurrence thereof, (x) the Consolidated Coverage Ratio of the Company or
NAVL would be at least 2.25:1.00 and (y) if, as a result of such
Incurrence, such Foreign Subsidiary shall then become subject to any
restriction or limitation (under any agreement or instrument governing
such Indebtedness) on its ability to pay dividends or make other
distributions to NAVL, the Foreign Subsidiary Coverage Ratio of the
Company or NAVL would be greater than 2.75:1.00; provided, that if such
Indebtedness is not incurred pursuant to the preceding clause (y), such
Indebtedness shall not be amended, modified or otherwise supplemented such
that such Foreign Subsidiary will become subject to any such restriction
or limitation referred to in such clause unless such Indebtedness could
then be Incurred pursuant to such clause, and any Refinancing Indebtedness
with respect to any such Indebtedness;
(11) Indebtedness of the Company or any Restricted Subsidiary in an
aggregate principal amount at any time outstanding (giving effect to any
refinancing thereof) not exceeding an amount equal to $95.0 million;
(12) Indebtedness of any Restricted Subsidiary that is permitted to
be Incurred under the Senior Credit Facility or any Indenture; and
(13) Indebtedness under the Interim Loan Facility, in an aggregate
principal amount not to exceed $40.0 million outstanding at any time.
(C) For purposes of determining compliance with, and the outstanding
principal amount of any particular Indebtedness Incurred pursuant to and in
compliance with, this covenant, (i) any other obligation of the obligor on such
Indebtedness (or of any other Person who could have Incurred such Indebtedness
under this covenant) arising under any Guarantee, Lien or letter of credit,
bankers' acceptance or other similar instrument or obligation supporting such
Indebtedness shall be disregarded to the extent that such Guarantee, Lien or
letter of credit, bankers' acceptance or other similar instrument or obligation
secures the principal amount of such Indebtedness; (ii) in the event that
Indebtedness meets the criteria of more than one of the types of Indebtedness
described in paragraph 6.3(B) above, the Company, in its sole discretion, shall
classify
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such item of Indebtedness and only be required to include the amount and type of
such Indebtedness in one of such clauses; and (iii) the amount of Indebtedness
issued at a price that is less than the principal amount thereof shall be equal
to the amount of the liability in respect thereof determined in accordance with
GAAP.
(D) For purposes of determining compliance with any
Dollar-denominated restriction on the Incurrence of Indebtedness denominated in
a foreign currency, the Dollar-equivalent principal amount of such Indebtedness
Incurred pursuant thereto shall be calculated based on the relevant currency
exchange rate in effect on the date that such Indebtedness was Incurred, in the
case of term Indebtedness, or first committed, in the case of revolving credit
Indebtedness, provided that (x) the Dollar-equivalent principal amount of any
such Indebtedness outstanding on the Issue Date shall be calculated based on the
relevant currency exchange rate in effect on the Issue Date, (y) if such
Indebtedness is Incurred to refinance other Indebtedness denominated in a
foreign currency, and such refinancing would cause the applicable
Dollar-denominated restriction to be exceeded if calculated at the relevant
currency exchange rate in effect on the date of such refinancing, such
Dollar-denominated restriction shall be deemed not to have been exceeded so long
as the principal amount of such refinancing Indebtedness does not exceed the
principal amount of such Indebtedness being refinanced and (z) the
Dollar-equivalent principal amount of Indebtedness denominated in a foreign
currency and Incurred pursuant to the Senior Credit Facility shall be calculated
based on the relevant currency exchange rate in effect on, at the Company's
option, (i) the Issue Date, (ii) any date on which any of the respective
commitments under the Senior Credit Facility shall be reallocated between or
among facilities or subfacilities thereunder, or on which such rate is otherwise
calculated for any purpose thereunder, or (iii) the date of such Incurrence. The
principal amount of any Indebtedness Incurred to refinance other Indebtedness,
if Incurred in a different currency from the Indebtedness being refinanced,
shall be calculated based on the currency exchange rate applicable to the
currencies in which such respective Indebtedness is denominated that is in
effect on the date of such refinancing.
Section 6.4 Withholding. Notwithstanding any other provision of this
Debenture Certificate, in the event that the Company makes any tax payment in
respect of any Debenture or share of Junior Preferred Stock for which such
Debenture was exchanged (including but not limited to any withholding tax
payment made by the Company under Chapter 3 of Subtitle A of the Code):
(A) if the tax payment is in respect of a cash interest payment or
distribution made on such Debenture or share, the amount of such cash payment or
distribution paid to the Holder of such Debenture or share shall be reduced by
the amount of such tax payment, provided that for all purposes hereof the Holder
of such Debenture or share shall be treated as having received the amount of
such tax payment as part of such cash
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payment or distribution and as having paid over such tax payment to the taxing
authority to which it was paid; and
(B) if the tax payment is not in respect of a cash interest payment or
distribution made on such Debenture or share (or exceeds a cash payment or
distribution made on such Debenture or share), the Principal Amount of such
Debenture as of the time of such tax payment shall be reduced by the amount of
such tax payment (or the amount of such excess) through an increase (without
duplication) in the Adjustment Amount.
If and to the extent that a Holder of any Debenture remits cash to the Company
for the specified purpose of funding a tax payment to be made by the Company in
respect of such Debenture or share, and such cash is received by the Company
prior to the time that the Company makes such tax payment, then such tax payment
shall be disregarded for purposes of the preceding sentence. If requested by any
Holder of any Debenture, the Company shall consult in good faith with such
Holder concerning the Company's obligations to make any tax payments in respect
of such Debenture.
ARTICLE 7
PREPAYMENT OF NOTE; CHANGE OF CONTROL OFFER; SPECIAL PREPAYMENT
Section 7.1. Optional Prepayment. (a) The Company may (subject to the
legal availability of funds therefor), at the option of the Company, redeem at
any time on or after the first anniversary of the Issue Date, from any source of
funds legally available therefor, in whole or in part, in the manner provided in
Section 7.3 hereof, any or all of the Debentures, at a redemption price for any
such Debenture equal to the sum of (i) the product of (A) the Principal Amount
of such Debenture as of the applicable Redemption Date, multiplied by (B) the
percentage set forth below with respect to such Redemption Date, plus (ii)
without duplication, an amount in cash equal to all interest accrued and unpaid
with respect to the Principal Amount of such Debenture to the Redemption Date
(collectively, the "Optional Redemption Price").
PERIOD PERCENTAGE
------ ----------
12-month period commencing
on the first anniversary of the
Issue Date ............................ 103%
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12-month period commencing
on the second anniversary of the
Issue Date ............................ 102%
12-month period commencing
on the third anniversary of the
Issue Date ............................ 101%
Thereafter ............................ 100%
(b) In addition, in the event a Change of Control of the Company is
consummated at any time prior to the first anniversary of the Issue Date, the
Company may redeem (subject to contractual and other restrictions with respect
thereto and the legal availability of funds therefor), in the manner provided in
Section 7.3 hereof, all of but not less than all of the outstanding Debentures
at a redemption price for each Debenture equal to 103% of the Principal Amount
of such Debenture as of the applicable Redemption Date thereof, plus, without
duplication, an amount in cash equal to all interest accrued and unpaid with
respect to the Principal Amount of the Debentures to the Redemption Date
(collectively, the "Special Redemption Price").
(c) In the event of a redemption of only a portion of the then outstanding
Debentures, the Company shall effect such redemption as it determines, pro rata,
according to the number of Debentures held by each Holder of the Debentures or
by lot, as may be determined by the Company in its sole discretion.
Section 7.2 Mandatory Repayments. Upon the existence and continuance for
at least 180 days of any Mandatory Redemption Event (other than a Mandatory
Redemption Event pursuant to clause (1) of the definition thereof) or upon the
existence and continuance of a Dividend Default for four consecutive quarterly
periods, the Company shall redeem (subject to the Debt Agreements (including the
availability of funds by dividend from NAVL in compliance therewith), and to the
legal availability of funds therefor) in the manner provided in Section 7.3
hereof, each Debenture then outstanding at a redemption price equal to the
Principal Amount of such Debenture as of the applicable Redemption Date, plus,
without duplication, an amount in cash equal to all interest accrued and unpaid
to the Redemption Date (collectively, the "Mandatory Redemption Price").
7.3 Procedures for Optional Redemption and Mandatory Redemption. (a) At
least 30 days and not more than 60 days prior to the date fixed for any
redemption of the Debentures, written notice (the "Redemption Notice") shall be
given by first-class mail, postage prepaid, to each Holder of record on the
record date fixed for such redemption of
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the Debentures at such Holder's address as the same appears on the Register,
provided that no failure to give such notice nor any deficiency therein shall
affect the validity of the procedure for the redemption of any Debentures to be
redeemed except as to the Holder or Holders to whom the Company has failed to
give said notice or except as to the Holder or Holders whose notice was
defective. The Redemption Notice shall state:
(i) whether the redemption is pursuant to Section 7.1(A), 7.1(B), 7.2 or
7.5 hereof;
(ii) the Optional Redemption Price, the Special Redemption Price, the
Mandatory Redemption Price, or the Residual Prepayment Price (as
defined in Section 7.5), as the case may be;
(iii) whether all or less than all the outstanding Debentures are to be
redeemed and the total Principal Amount of Debentures being
redeemed;
(iv) the number of Debentures held, as of the appropriate record date, by
the Holder that the Company intends to redeem;
(v) the date fixed for redemption;
(vi) that the Holder is to surrender to the Company, at the place or
places where certificates for Debentures are to be surrendered for
redemption, in the manner and at the price designated, the
certificate or certificates representing the Debentures to be
redeemed; and
(vii) that interest on the Debentures to be redeemed shall cease to accrue
on the Redemption Date unless the Company defaults in the payment of
the Optional Redemption Price, the Special Redemption Price or the
Mandatory Redemption Price, as the case may be.
(b) On or prior to the date fixed for redemption, each Holder of
Debentures shall surrender the certificate or certificates representing such
Debentures to the Company, duly endorsed, in the manner and at the place
designated in the Redemption Notice, and on the Redemption Date, the full
Optional Redemption Price, the Special Redemption Price or Mandatory Redemption
Price, as the case may be, for such Debentures shall be payable in cash to the
Person whose name appears on such certificate or certificates as the owner
thereof, and each surrendered certificate shall be canceled and retired. In the
event that less than all of the Debentures represented by any such certificate
are redeemed, a new certificate shall be issued representing the unredeemed
Debentures.
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(c) If the funds of the Company legally available for redemption of
Debentures on any Redemption Date are insufficient to redeem the total number of
Debentures to be redeemed on such date, or if a complete redemption is not
permitted by any Debt Agreement (or any Debt Agreement does not permit NAVL to
Debentures sufficient legally available funds to the Company to effect a
complete redemption), those funds which are legally available shall be used to
redeem the maximum possible number of Debentures of the Holders to the extent
permitted by each Debt Agreement and to the extent NAVL is permitted under each
Debt Agreement to dividend an equal amount of funds to the Company out of funds
legally available therefor. At any time thereafter when additional funds of the
Company are legally available for the redemption of Debentures, such funds shall
immediately be used to redeem the balance of the Debentures which the Company
has become obligated to redeem, on any Redemption Date but which it has not
redeemed, to the extent permitted by each Debt Agreement and to the extent NAVL
is permitted under each Debt Agreement to dividend an equal amount of funds to
the Company out of funds legally available therefor.
(d) Unless the Company defaults in the payment in full of the applicable
redemption price, interest on the Debentures called for redemption shall cease
to accrue on the Redemption Date, and the Holders of such Debentures shall cease
to have any further rights with respect thereto on the Redemption Date, other
than the right to receive the Optional Redemption Price, the Special Redemption
Price or the Mandatory Redemption Price, as the case may be, without interest.
Section 7.4 Change of Control.
(i) Unless otherwise consented to by the Majority Holder, upon the
occurrence after the Issue Date of a Change of Control, each Holder of
Debentures then outstanding, subject to the other provisions of this Section
7.4, shall have the right (subject to the Debt Agreements (including the
availability of funds by dividend from NAVL in compliance therewith), and to the
legal availability of funds therefor) to require the Company to purchase any or
all of such Holder's Debentures pursuant to an offer (an "Offer") at a purchase
price per share in cash equal to 101% of the Principal Amount of such Debenture
at the purchase date, plus, without duplication, an amount in cash equal to all
accrued and unpaid interest with respect to the Principal Amount of such
Debenture to the purchase date (collectively, the "Change of Control Purchase
Price"). Unless the Company has exercised its right to redeem the Debentures as
described under Section 7.1 above, the Company shall not later than 30 days
following the date the Company obtains actual knowledge of any Change of Control
having occurred, mail a notice (the "Purchase Notice") to each Holder of record
stating: (1) that a Change of Control has occurred or may occur and that such
Holder has, or upon such occurrence will have, the right (subject to the Debt
Agreements (including the availability of funds by dividend from NAVL in
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compliance therewith), and to the legal availability of funds therefor) to
require the Company to purchase any or all of such Holder's Debentures at a
purchase price per Debenture in cash equal to 101% of the Principal Amount
thereof on the relevant Purchase Date, plus, without duplication, an amount in
cash equal to all accrued and unpaid interest, if any, with respect to such
Debenture; (2) the circumstances and relevant facts and financial information
regarding such Change of Control; (3) the date fixed for such purchase (which
shall be no earlier than 30 days nor later than 60 days from the date such
notice is mailed); (4) the instructions determined by the Company, consistent
with this Section 7.4, that a Holder must follow in order to have its Debentures
purchased; and (5) if such notice is mailed prior to the occurrence of a Change
of Control, that such Offer is conditioned on the occurrence of such Change of
Control.
(ii) Holders of Debentures electing to have Debentures purchased shall be
required to surrender the certificate or certificates representing such
Debentures, duly endorsed, to the Company in the manner and at the address
specified in the Purchase Notice at least three Business Days prior to the date
fixed for such purchase. On the Purchase Date, the Change of Control Purchase
Price for such Debentures shall become payable in cash to the Person whose name
appears on such certificate or certificates as the owner thereof. In the event
that less than all of the shares represented by any such certificate are
purchased, a new certificate shall be issued representing the shares not
purchased.
(iii) if the funds of the Company legally available for any purchase of
Debentures under this Section 7.4 on any Purchase Date are insufficient to
purchase the aggregate amount of Debentures to be purchased on such date or if a
complete purchase is not permitted by any Debt Agreement (or any Debt Agreement
does not permit NAVL to dividend sufficient legally available funds to the
Company to effect a complete purchase), those funds which are legally available
shall be used to purchase the maximum possible number of shares of the Holders
to the extent permitted by each Debt Agreement and to the extent NAVL is
permitted to dividend an equal amount of funds to the Company under each Debt
Agreement out of funds legally available therefor. At any time thereafter when
additional funds of the Company are legally available for the purchase of
shares, such funds shall immediately be used to purchase the balance of the
amount of Debentures which the Company has become obligated to purchase on any
Purchase Date but which it has not purchased, to the extent permitted by each
Debt Agreement and to the extent NAVL is permitted to dividend an equal amount
of funds to the Company under each Debt Agreement out of funds legally available
therefor.
(iv) Unless the Company defaults in the payment in full of the applicable
Change of Control Purchase Price, interest on the Debentures tendered for
purchase shall cease to accrue on the date fixed for such purchase, and the
Holders of such Debentures shall cease
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to have any further rights with respect thereto on the such date, other than the
right to receive the Change of Control Purchase Price without interest.
(v) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the purchase of Debentures pursuant to this
Section 7.4. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 7.4, the Company will
comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this Section 7.4 by virtue
thereof.
(vi) Notwithstanding any other provision of this Section 7.4, the Company
shall not be required to purchase any Debentures under this Section 7.4, (A)
unless NAVL is required to purchase or repay the outstanding Notes and Senior
Discount Notes pursuant to the Indentures and has offered to purchase or repay
in full all of the outstanding Notes and Senior Discount Notes and has so
purchased or repaid in full all of the outstanding Notes and Senior Discount
Notes of each holder of any Note or Senior Discount Note who has accepted such
offer and (B) unless the principal of and all accrued and unpaid interest on all
indebtedness under the Senior Credit Facility, and all other monetary
obligations owing in respect of the Senior Credit Facility, shall have been paid
in full, and all letters of credit, bankers acceptances and similar instruments
outstanding thereunder shall have expired undrawn.
Section 7.5. Special Prepayment. The Company may (subject to the legal
availability of funds therefor), at the option of the Company, redeem at any
time, from any source of funds legally available therefor, in whole or in part,
in the manner provided in Section 7.3 hereof, any portion of the Principal
Amount of the Debentures in an amount that does not exceed the Residual
Principal at a redemption price for any such Debenture equal to the portion of
the Principal Amount of the Debentures to be redeemed, plus accrued and unpaid
interest on such portion of the Principal Amount to be redeemed (collectively,
the "Residual Prepayment Price").
ARTICLE 8
OTHER PROVISIONS OF GENERAL APPLICATION
Section 8.1 Loss, Theft, Destruction or Mutilation of Debenture.
Upon receipt by the Company of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Debenture, and of
indemnity or security reasonably satisfactory to the Company, and upon
reimbursement to the Company of all reasonable expenses incidental thereto, and
upon surrender and
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cancellation of this Debenture, if mutilated, the Company will make and deliver
a new Debenture of like tenor, in lieu of this Debenture. Any Debenture made and
delivered in accordance with the provisions of this Section 8.1 shall be dated
the date hereof.
Section 8.2 Governing Law.
This Debenture shall be construed in accordance with and governed by the
law of the State of New York.
Section 8.3 Maintenance of Register; Restriction; on Transfer; Successors
and Assigns. (a) The Company will keep at its principal office in Fort Wayne,
Indiana (or such other location of its principal office from time to time) a
register (the "Register") in which the Company will provide for the registration
and transfer of the Debenture and will record the name of and address for
notices to, the Holder. The Company and any agent of the Company may treat the
Person in whose name this Debenture is registered as the owner of such Debenture
for the purpose of receiving payment of the principal amount of this Debenture
and interest on the unpaid balance of such principal amount and for all other
purposes, whether or not this Debenture be overdue, and neither the Company nor
any such agent shall be affected by notice to the contrary.
(b) Upon surrender of this Debenture for registration of transfer or for
exchange to the Company at its principal office set forth above, the Company at
its expense (except for transfer taxes, if any) will execute and deliver in
exchange therefor a new Debenture. Such new Debenture shall (A) have an
aggregate principal amount equal to the principal amount of the surrendered
Debenture, (B) be registered in each case in such name as such holder or
transferee may request, and (C) be dated as of the semi-annual interest payment
date coinciding with or immediately preceding the date of such surrender.
(c) By accepting this Debenture, the Holder acknowledges and agrees that:
(i) the Debenture has not been registered under the Securities Act or any other
applicable securities laws and may not be sold or transferred in the absence of
such registration or an exemption therefrom under said Act and any other
applicable securities laws and (ii) the Debenture may not be transferred, sold,
pledged, hypothecated or otherwise disposed of unless (A) the Company shall have
consented to such disposition in writing, such consent not to be unreasonably
withheld, (B) such disposition is in whole and not in part, (C) (x) such
disposition is pursuant to an effective registration statement under the
Securities Act, (y) the Holder shall have delivered to the Company a written
opinion of counsel, which opinion and counsel shall be reasonably satisfactory
to the Company, to the effect that such disposition is exempt from the
provisions of Section 5 of such Act and (if applicable) any other applicable
securities laws or (z) a no-action letter from the Securities and Exchange
Commission, reasonably satisfactory to the Company, shall have been obtained
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<PAGE>
with respect to such disposition, and (D) such disposition is pursuant to
registration under any applicable state securities laws or an exemption
therefrom. Any other purported transfer of the Debenture by the Holder shall be
void and without force and effect.
(d) All the covenants, stipulations, promises and agreements contained in
this Debenture shall bind the successors and assigns of the Company and the
Holder and shall inure to the benefit of the successors and permitted assigns of
the Company and the Holder, whether so expressed or not.
Section 8.4 Amendment. (a) Without Consent of Holders. Without the consent
of the Holders of any Debentures, the Company may enter into one or more
amendments supplemental hereto, for any of the following purposes:
(a) to cure any ambiguity, omission, defect or inconsistency,
(b) to provide for the assumption by a successor of the obligations of the
Company under this Debenture Certificate,
(c) to provide for uncertificated Debentures in addition to or in place of
certificated Debentures,
(d) to add Guarantees with respect to the Debentures, to secure the
Debentures, to confirm and evidence the release, termination or discharge of any
Guarantee or Lien with respect to or securing the Debentures when such release,
termination or discharge is provided for under this Debenture Certificate,
(e) to add to the covenants of the Company for the benefit of the Holders
of the Debentures or to surrender any right or power conferred upon the Company,
(f) to provide that any Indebtedness that becomes or will become an
obligation of a Successor Company pursuant to a transaction governed by Article
6 (and that is not a Subordinated Obligation) is Senior Subordinated
Indebtedness or Guarantor Senior Subordinated Indebtedness for purposes of this
Debenture Certificate,
(g) to provide for or confirm the issuance of Additional Debentures,
(h) to make any change that does not adversely affect the rights of any
Holder under the Debentures or this Debenture Certificate or
(i) to make any Conforming Change (as defined in Section 8.4(e) below).
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(b) With Consent of Holders. The Company may amend or supplement this Debenture
Certificate or the Debentures with the written consent of the Majority Holders
(including consents obtained in connection with a tender offer or exchange offer
for Debentures), and the Majority Holders (including by consents obtained in
connection with a tender offer or exchange offer for Debentures) may waive any
existing Default or Event of Default or compliance by the Company with any
provision of this Debenture Certificate or the Debentures.
Notwithstanding the provisions of this Section 8.4(b), without the consent
of each Holder affected, an amendment or waiver, including a waiver pursuant to
Article 5, may not:
(i) reduce the principal amount of the Debentures whose Holders must
consent to an amendment or waiver;
(ii) reduce the rate of or extend the time for payment of interest on any
Debenture;
(iii) reduce the principal or extend the Stated Maturity of any Debenture;
(iv) reduce the premium payable upon the redemption of any Debenture or
change the date on which any Debenture may be redeemed as described in Section
6.1;
(v) make any Debenture payable in money other than that stated in the
Debenture;
(vi) make any change in Article 4 that adversely affects the rights of any
Holder in any material respect;
(vii) impair the right of any Holder to receive payment of principal of
and interest on such Holder's Debentures on or after the due dates therefor or
to institute suit for the enforcement of any payment on or with respect to such
Holder's Debentures; or
(viii) make any change in the amendment or waiver provisions described in
this sentence.
Notwithstanding Section 8.4(a) and the foregoing provisions of this
Section 8.4(b), no amendment to Article 4 of this Debenture Certificate or the
definitions
57
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relating thereto that adversely affects the rights of any Holder of Senior
Indebtedness at the time outstanding (which Senior Indebtedness has been
previously designated in writing by the Company to the Holders for this purpose)
may be made unless the holders of such Senior Indebtedness (or any group or
representative thereof authorized to give a consent) consent in writing to such
amendment.
It shall not be necessary for the consent of the Holders under this
Section 8.4(b) to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 8.4(b) becomes
effective, the Company shall mail to the Holders of each Debenture affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity or effectiveness of any such
amendment, supplement or waiver.
(c) Revocation and Effect of Consents. Until an amendment, supplement or waiver
becomes effective, a consent to it by a Holder is a continuing consent by the
Holder and every subsequent Holder of that Debenture or any Debenture that
evidences all or any part of the same debt as the consenting Holder's Debenture,
even if notation of the consent is not made on any Debenture. Subject to the
following paragraph of this Section 8.4(c), any such Holder or subsequent Holder
may revoke the consent as to such Holder's Debenture by notice to the Company
received by the Company before the date on which the Holders receive an
Officer's Certificate certifying that the Holders of the requisite principal
amount of Debentures have consented (and not theretofore revoked such consent)
to the amendment, supplement or waiver. The Company may, but shall not be
obligated to, fix a record date for the purpose of determining the Holders
entitled to consent to any amendment, supplement or waiver.
After an amendment, supplement or waiver becomes effective, it shall bind
every Holder of Debentures, unless it makes a change described in any of clauses
(i) through (viii) of the second paragraph of Section 8.4(b). In that case, the
amendment, supplement or waiver shall bind each Holder of a Debenture who has
consented to it and every subsequent Holder of such Debenture or any Debenture
that evidences all or any part of the same debt as the consenting Holder's
Debenture.
(d) Notation on or Exchange of Notes. If an amendment, supplement or waiver
changes the terms of a Debenture, the Company may request the Holder of the
58
<PAGE>
Debenture to deliver it to the Company. The Company shall place an appropriate
notation on the Debenture about the changed terms and return it to the Holder.
Alternatively, if the Company so determines, the Company shall issue in exchange
for the Debenture a new Debenture that reflects the changed terms. Failure to
make the appropriate notation or issue a new Debenture shall not affect the
validity and effect of such amendment, supplement or waiver.
(e) "Conforming Change" means, in the event any provision of the Credit
Agreement or any Indenture is amended or waived in accordance with its terms and
if any provision in Article 5 or 6 or Section 7.4 of this Debenture is
substantially similar to such amended or waived provision in such other
agreement, any amendment or waiver hereunder made (or deemed made in the case of
a waiver) in like manner and to the same extent.
(f) Any term of this Debenture may only be amended or waived in accordance
with this Section 8.4, and any amendment or waiver effected in accordance with
this Section 8.4 shall be binding upon the Holder and the Company, whether or
not (in the case of an amendment or waiver affecting this Debenture) the
substance of such amendment or waiver is thereafter incorporated on the face of
this Debenture Certificate.
Section 8.5 Headings.
The headings of the articles and sections of this Debenture Certificate
are inserted for convenience only and shall not be deemed to constitute a part
hereof.
Section 8.6 Notices.
Any notice or other communication under this Debenture shall be in writing
and shall be deemed to have been duly given or made (i) when delivered by hand,
(ii) four Business Days after it is sent by express, registered or certified
mail, return receipt requested, postage prepaid, or (iii) one Business Day after
it is sent by nationally recognized overnight courier, in each case addressed as
follows:
(a) if to the Holder, at the address set forth below or to such other
address as the Holder shall have furnished to the Company in
writing:
Attention:
(b) if to the Company, at the address set forth below or to such other
address as the Company shall have furnished to the Holder in
writing:
59
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NA Holding Corporation
P.O. Box 988
Fort Wayne, Indiana 46801-0988
Attention: President
with a copy to:
Debevoise & Plimpton
875 Third Avenue
New York, NY 10022
Attention:
Section 8.7 Provisions for the Benefit of Third Parties.
The provisions of Article 4 of this Debenture are for the benefit of the
holders from time to time of Senior Indebtedness, and their Representative shall
be entitled to enforce such provisions on their behalf. Except as set forth in
the preceding sentence, nothing in this Debenture shall confer any rights upon
any Person other than the Company and the Holder and their respective successors
and permitted assigns.
60
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IN WITNESS WHEREOF, NA Holding Corporation has caused this Debenture to be
signed in its corporate name by a duly authorized officer and to be dated as of
the day and year first above written.
NA HOLDING CORPORATION
By
-------------------------------
Name:
Title.
61
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DEBENTURE (cont'd)
PREPAYMENTS
Amount of
Date Principal Prepaid Notation Made By
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Annex B to Certificate
of Designation for
Junior Preferred Stock
[FORM OF TRANSFER NOTICE]
To assign this Certificate, fill in the form below:
I or we assign and transfer the shares represented by this Certificate in
compliance with the exemption from registration under the Securities Act of
1933, as amended, provided by Rule 144A thereunder to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint_________________________________________________
agent to transfer such shares on the books of the Company. The agent may
substitute another to act for him.
Date:________________________
NOTICE: The signature to this assignment must
correspond with the name as written upon the face of
the within-mentioned instrument in every particular,
without alteration or any change whatsoever.
TO BE COMPLETED BY ASSIGNEE
The undersigned represents and warrants that it is purchasing the shares
represented by this Certificate for its own account or an account with respect
to which it exercises sole investment discretion and that it and any such
account is a "qualified institutional buyer" within the meaning of Rule 144A
under the Securities Act of 1933, as amended, and is aware that the sale to it
is being made in reliance on Rule 144A and acknowledges that it has received
such information regarding the Company as the undersigned has requested pursuant
to Rule 144A or has determined not to request such information and that it is
aware that the transferor is relying upon the undersigned's
<PAGE>
foregoing representations in order to claim the exemption from registration
provided by Rule 144A.
Dated:______________________ __________________________________
NOTICE: To be executed by an
executive officer
2
<PAGE>
Exhibit 3.4
================================================================================
NA HOLDING CORPORATION
BY-LAWS
As adopted on December 19, 1997,
as amended by consent resolution on March 31, 1998 and
as amended on July 14, 1998
================================================================================
<PAGE>
NA HOLDING CORPORATION
BY-LAWS
TABLE OF CONTENTS
SECTION PAGE
- ------- ----
ARTICLE I STOCKHOLDERS......................................................1
Section 1.01. Annual Meetings.......................................1
Section 1.02. Special Meetings......................................1
Section 1.03. Notice of Meetings; Waiver............................2
Section 1.04. Quorum................................................3
Section 1.05. Voting................................................3
Section 1.06. Voting by Ballot......................................3
Section 1.07. Adjournment...........................................4
Section 1.08. Proxies...............................................4
Section 1.09. Organization; Procedure...............................5
Section 1.10. Consent of Stockholders in Lieu of
Meeting...............................................5
ARTICLE II BOARD OF DIRECTORS...............................................6
Section 2.01. General Powers........................................6
Section 2.02. Number and Term of Office.............................7
Section 2.03. Election of Directors.................................7
Section 2.04. Annual and Regular Meetings...........................7
Section 2.05. Special Meetings; Notice..............................8
Section 2.06. Quorum; Voting........................................8
Section 2.07. Adjournment...........................................9
Section 2.08. Action Without a Meeting..............................9
Section 2.09. Regulations; Manner of Acting.........................9
Section 2.10. Action by Telephonic Communications...................9
Section 2.11. Resignations..........................................9
Section 2.12. Removal of Directors.................................10
Section 2.13. Vacancies and Newly Created
Directorships........................................10
ii
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Section 2.14. Compensation.........................................10
Section 2.15. Reliance on Accounts and Reports, etc................11
ARTICLE III EXECUTIVE COMMITTEE AND OTHER COMMITTEES.......................11
Section 3.01. How Constituted......................................11
Section 3.02. Powers...............................................12
Section 3.03. Proceedings..........................................14
Section 3.04. Quorum and Manner of Acting..........................14
Section 3.05. Action by Telephonic Communications..................14
Section 3.06. Absent or Disqualified Members.......................15
Section 3.07. Resignations.........................................15
Section 3.08. Removal..............................................15
Section 3.09. Vacancies............................................15
ARTICLE IV OFFICERS........................................................15
Section 4.01. Number...............................................15
Section 4.02. Election.............................................16
Section 4.03. Salaries.............................................16
Section 4.04. Removal and Resignation; Vacancies...................16
Section 4.05. Authority and Duties of Officers.....................17
Section 4.06. The President........................................17
Section 4.07. The Vice Presidents..................................18
Section 4.08. The Secretary........................................18
Section 4.09. The Treasurer........................................19
Section 4.10. Additional Officers..................................21
Section 4.11. Security.............................................21
ARTICLE V CAPITAL STOCK....................................................21
Section 5.01. Certificates of Stock................................21
Section 5.02. Signatures; Facsimile................................22
Section 5.03. Lost, Stolen or Destroyed Certificates...............22
Section 5.04. Transfer of Stock....................................23
Section 5.05. Record Date..........................................23
Section 5.06. Registered Stockholders..............................25
Section 5.07. Transfer Agent and Registrar.........................25
ARTICLE VI INDEMNIFICATION.................................................25
Section 6.01. Nature of Indemnity..................................25
Section 6.02. Successful Defense...................................27
iii
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Section 6.03. Determination That Indemnification Is
Proper...............................................27
Section 6.04. Advance Payment of Expenses..........................27
Section 6.05. Procedure for Indemnification of
Directors and Officers...............................28
Section 6.06. Survival; Preservation of Other
Rights...............................................29
Section 6.07. Insurance............................................30
Section 6.08. Severability.........................................30
ARTICLE VII OFFICES........................................................31
Section 7.01. Registered Office....................................31
Section 7.02. Other Offices........................................31
ARTICLE VIII GENERAL PROVISIONS............................................31
Section 8.01. Dividends............................................31
Section 8.02. Reserves.............................................32
Section 8.03. Execution of Instruments.............................32
Section 8.04. Corporate Indebtedness...............................32
Section 8.05. Deposits.............................................33
Section 8.06. Checks...............................................33
Section 8.07. Sale, Transfer, etc. of Securities...................33
Section 8.08. Voting as Stockholder................................33
Section 8.09. Fiscal Year..........................................34
Section 8.10. Seal.................................................34
Section 8.11. Books and Records; Inspection........................34
ARTICLE IX AMENDMENT OF BY-LAWS............................................35
Section 9.01. Amendment............................................35
ARTICLE X CONSTRUCTION.....................................................35
Section 10.01. Construction.........................................35
iv
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NA HOLDING CORPORATION
BY-LAWS
As adopted on December 19, 1997,
as amended by consent resolution on March 31, 1998, and
as amended on July 14, 1998
ARTICLE I
STOCKHOLDERS
Section 1.01. Annual Meetings. The annual meeting of the
stockholders of the Corporation for the election of directors and for the
transaction of such other business as properly may come before such meeting
shall be held at such place, either within or without the State of Delaware, and
at 10:00 a.m. local time on the first Tuesday in May (or, if such day is a legal
holiday, then on the next succeeding business day), or at such other date and
hour, as may be fixed from time to time by resolution of the Board of Directors
and set forth in the notice or waiver of notice of the meeting. [Sections
211(a), (b).](1)
Section 1.02. Special Meetings. Special meetings of the stockholders
may be called at any time by the President (or, in the event of his absence or
disability, by any Vice President), or by the Board of Directors. A special
meeting shall be called by the President (or, in the event of his absence or
disability, by any Vice President), or by the Secretary, immediately upon
receipt of a written request therefor by stockholders holding in the aggregate
- ----------
(1) Citations are to the General Corporation Law of the State of Delaware as
in effect on March 20, 1992 (the "GCL"), and are inserted for reference
only, and do not constitute a part of the By-Laws.
<PAGE>
not less than a majority of the outstanding shares of the Corporation at the
time entitled to vote at any meeting of the stockholders. If such officers or
the Board of Directors shall fail to call such meeting within 20 days after
receipt of such request, any stockholder executing such request may call such
meeting. Such special meetings of the stockholders shall be held at such places,
within or without the State of Delaware, as shall be specified in the respective
notices or waivers of notice thereof. [Section 211(d).]
Section 1.03. Notice of Meetings; Waiver. The Secretary or any
Assistant Secretary shall cause written notice of the place, date and hour of
each meeting of the stockholders, and, in the case of a special meeting, the
purpose or purposes for which such meeting is called, to be given personally or
by mail, not less than ten nor more than sixty days prior to the meeting, to
each stockholder of record entitled to vote at such meeting. If such notice is
mailed, it shall be deemed to have been given to a stockholder when deposited in
the United States mail, postage prepaid, directed to the stockholder at his
address as it appears on the record of stockholders of the Corporation, or, if
he shall have filed with the Secretary of the Corporation a written request that
notices to him be mailed to some other address, then directed to him at such
other address. Such further notice shall be given as may be required by law.
No notice of any meeting of stockholders need be given to any
stockholder who submits a signed waiver of notice, whether before or after the
meeting. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the stockholders need be specified in a written
waiver of notice. The attendance of any stockholder at a meeting of stockholders
shall constitute a waiver of notice of such meeting, except when the stockholder
attends a meeting for the express purpose of
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objecting, at the beginning of the meeting, to the transaction of any business
on the ground that the meeting is not lawfully called or convened. [Sections
222, 229.]
Section 1.04. Quorum. Except as otherwise required by law or by the
Certificate of Incorporation, the presence in person or by proxy of the holders
of record of a majority of the shares entitled to vote at a meeting of
stockholders shall constitute a quorum for the transaction of business at such
meeting. [Section 216.]
Section 1.05. Voting. If, pursuant to Section 5.05 of these By-Laws,
a record date has been fixed, every holder of record of shares entitled to vote
at a meeting of stockholders shall be entitled to one vote for each share
outstanding in his name on the books of the Corporation at the close of business
on such record date. If no record date has been fixed, then every holder of
record of shares entitled to vote at a meeting of stockholders shall be entitled
to one vote for each share of stock standing in his name on the books of the
Corporation at the close of business on the day next preceding the day on which
notice of the meeting is given, or, if notice is waived, at the close of
business on the day next preceding the day on which the meeting is held. Except
as otherwise required by law or by the Certificate of Incorporation, the vote of
a majority of the shares represented in person or by proxy at any meeting at
which a quorum is present shall be sufficient for the transaction of any
business at such meeting. [Sections 212(a), 216.]
Section 1.06. Voting by Ballot. No vote of the stockholders need be
taken by written ballot or conducted by Inspectors of Elections unless otherwise
required by law. Any vote which need not be taken by ballot may be conducted in
any manner approved by the meeting.
3
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Section 1.07. Adjournment. If a quorum is not present at any meeting
of the stockholders, the stockholders present in person or by proxy shall have
the power to adjourn any such meeting from time to time until a quorum is
present. Notice of any adjourned meeting of the stockholders of the Corporation
need not be given if the place, date and hour thereof are announced at the
meeting at which the adjournment is taken, provided, however, that if the
adjournment is for more than thirty days, or if after the adjournment a new
record date for the adjourned meeting is fixed pursuant to Section 5.05 of these
By-Laws, a notice of the adjourned meeting, conforming to the requirements of
Section 1.03 hereof, shall be given to each stockholder of record entitled to
vote at such meeting. At any adjourned meeting at which a quorum is present, any
business may be transacted that might have been transacted on the original date
of the meeting. [Section 222(c).]
Section 1.08. Proxies. Any stockholder entitled to vote at any
meeting of the stockholders or to express consent to or dissent from corporate
action without a meeting may authorize another person or persons to vote at any
such meeting and express such consent or dissent for him by proxy. A stockholder
may authorize a valid proxy by executing a written instrument signed by such
stockholder, or by causing his or her signature to be affixed to such writing by
any reasonable means including, but not limited to, by facsimile signature, or
by transmitting or authorizing the transmission of a telegram, cablegram or
other means of electronic transmission to the person designated as the holder of
the proxy, a proxy solicitation firm or a like authorized agent. No such proxy
shall be voted or acted upon after the expiration of three years from the date
of such proxy, unless such proxy provides for a longer period. Every proxy shall
be revocable at the pleasure of the stockholder executing it, except in those
cases where applicable law provides that a proxy shall be irrevocable. A
stockholder may revoke any proxy which is
4
<PAGE>
not irrevocable by attending the meeting and voting in person or by filing an
instrument in writing revoking the proxy or by filing another duly executed
proxy bearing a later date with the Secretary. Proxies by telegram, cablegram or
other electronic transmission must either set forth or be submitted with
information from which it can be determined that the telegram, cablegram or
other electronic transmission was authorized by the stockholder. Any copy,
facsimile telecommunication or other reliable reproduction of a writing or
transmission created pursuant to this section may be substituted or used in lieu
of the original writing or transmission for any and all purposes for which the
original writing or transmission could be used, provided that such copy,
facsimile telecommunication or other reproduction shall be a complete
reproduction of the entire original writing or transmission. [Sections 212(b),
(c).]
Section 1.09. Organization; Procedure. At every meeting of
stockholders the presiding officer shall be the President or, in the event of
his absence or disability, a presiding officer chosen by a majority of the
stockholders present in person or by proxy. The Secretary, or in the event of
his absence or disability, the Assistant Secretary, if any, or if there be no
Assistant Secretary, in the absence of the Secretary, an appointee of the
presiding officer, shall act as Secretary of the meeting. The order of business
and all other matters of procedure at every meeting of stockholders may be
determined by such presiding officer.
Section 1.10. Consent of Stockholders in Lieu of Meeting. To the
fullest extent permitted by law, whenever the vote of stockholders at a meeting
thereof is required or permitted to be taken for or in connection with any
corporate action, such action may be taken without a meeting, without prior
notice and without a vote of stockholders, if a consent or consents in writing,
setting forth the action so taken, shall be signed by the holders of
5
<PAGE>
outstanding stock having not less than the minimum number of votes that would be
necessary to authorize or take such action at a meeting at which all shares
entitled to vote thereon were present and voted and shall be delivered to the
Corporation by delivery to its registered office in the State of Delaware, its
principal place of business, or an officer or agent of the Corporation having
custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery made to the Corporation's registered office shall be by hand
or by certified or registered mail, return receipt requested.
Every written consent shall bear the date of signature of each
stockholder or member who signs the consent and no written consent shall be
effective to take the corporate action referred to therein unless, within sixty
days of the earliest dated consent delivered in the manner required by law to
the Corporation, written consents signed by a sufficient number of holders or
members to take action are delivered to the Corporation by delivery to its
registered office in the State of Delaware, its principal place of business, or
an officer or agent of the Corporation having custody of the book in which
proceedings of meetings of stockholders are recorded. Delivery made to the
Corporation's registered office shall be by hand or by certified or registered
mail, return receipt requested. [Section 228.]
ARTICLE II
BOARD OF DIRECTORS
Section 2.01. General Powers. Except as may otherwise be provided by
law, by the Certificate of Incorporation or by these By-Laws, the property,
affairs and business of the Corporation shall be managed by or under the
direction of the Board of Directors and the Board of
6
<PAGE>
Directors may exercise all the powers of the Corporation. [Section 141(a).]
Section 2.02. Number and Term of Office. The number of Directors
constituting the entire Board of Directors shall be three (3), which number may
be modified from time to time by resolution of the Board of Directors, but in no
event shall the number of Directors be less than one. Each Director (whenever
elected) shall hold office until his successor has been duly elected and
qualified, or until his earlier death, resignation or removal. [Section 141(b).]
Section 2.03. Election of Directors. Except as otherwise provided in
Sections 2.12 and 2.13 of these By-Laws, the Directors shall be elected at each
annual meeting of the stockholders. If the annual meeting for the election of
Directors is not held on the date designated therefor, the Directors shall cause
the meeting to be held as soon thereafter as convenient. At each meeting of the
stockholders for the election of Directors, provided a quorum is present, the
Directors shall be elected by a plurality of the votes validly cast in such
election. [Sections 211(b), (c), 216.]
Section 2.04. Annual and Regular Meetings. The annual meeting of the
Board of Directors for the purpose of electing officers and for the transaction
of such other business as may come before the meeting shall be held as soon as
possible following adjournment of the annual meeting of the stockholders at the
place of such annual meeting of the stockholders. Notice of such annual meeting
of the Board of Directors need not be given. The Board of Directors from time to
time may by resolution provide for the holding of regular meetings and fix the
place (which may be within or without the State of Delaware) and the date and
hour of such meetings. Notice of regular meetings need not be given, provided,
however, that if the Board of Directors
7
<PAGE>
shall fix or change the time or place of any regular meeting, notice of such
action shall be mailed promptly, or sent by telegram, radio or cable, to each
Director who shall not have been present at the meeting at which such action was
taken, addressed to him at his usual place of business, or shall be delivered to
him personally. Notice of such action need not be given to any Director who
attends the first regular meeting after such action is taken without protesting
the lack of notice to him, prior to or at the commencement of such meeting, or
to any Director who submits a signed waiver of notice, whether before or after
such meeting. [Section 141(g).]
Section 2.05. Special Meetings; Notice. Special meetings of the
Board of Directors shall be held whenever called by the President or, in the
event of his absence or disability, by any Vice President, at such place (within
or without the State of Delaware), date and hour as may be specified in the
respective notices or waivers of notice of such meetings. Special meetings of
the Board of Directors may be called on 24 hours' notice, if notice is given to
each Director personally or by telephone or telegram, or on five days' notice,
if notice is mailed to each Director, addressed to him at his usual place of
business. Notice of any special meeting need not be given to any Director who
attends such meeting without protesting the lack of notice to him, prior to or
at the commencement of such meeting, or to any Director who submits a signed
waiver of notice, whether before or after such meeting, and any business may be
transacted thereat. [Sections 141(g), 229.]
Section 2.06. Quorum; Voting. At all meetings of the Board of
Directors, the presence of a majority of the total authorized number of
Directors shall constitute a quorum for the transaction of business. Except as
otherwise required by law, the vote of a majority of the Directors present at
any meeting at which a quorum is present shall be the act of the Board of
Directors. [Section 141(b).]
8
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Section 2.07. Adjournment. A majority of the Directors present,
whether or not a quorum is present, may adjourn any meeting of the Board of
Directors to another time or place. No notice need be given of any adjourned
meeting unless the time and place of the adjourned meeting are not announced at
the time of adjournment, in which case notice conforming to the requirements of
Section 2.05 shall be given to each Director.
Section 2.08. Action Without a Meeting. Any action required or
permitted to be taken at any meeting of the Board of Directors may be taken
without a meeting if all members of the Board of Directors consent thereto in
writing, and such writing or writings are filed with the minutes of proceedings
of the Board of Directors. [Section 141(f).]
Section 2.09. Regulations; Manner of Acting. To the extent
consistent with applicable law, the Certificate of Incorporation and these
By-Laws, the Board of Directors may adopt such rules and regulations for the
conduct of meetings of the Board of Directors and for the management of the
property, affairs and business of the Corporation as the Board of Directors may
deem appropriate. The Directors shall act only as a Board, and the individual
Directors shall have no power as such.
Section 2.10. Action by Telephonic Communications. Members of the
Board of Directors may participate in a meeting of the Board of Directors by
means of conference telephone or similar communications equipment by means of
which all persons participating in the meeting can hear each other, and
participation in a meeting pursuant to this provision shall constitute presence
in person at such meeting. [Section 141(i).]
Section 2.11. Resignations. Any Director may resign at any time by
delivering a written notice of
9
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resignation, signed by such Director, to the President or the Secretary. Unless
otherwise specified therein, such resignation shall take effect upon delivery.
[Section 141(b).]
Section 2.12. Removal of Directors. Any Director may be removed at
any time, either for or without cause, upon the affirmative vote of the holders
of a majority of the outstanding shares of stock of the Corporation entitled to
vote for the election of such Director, cast at a special meeting of
stockholders called for the purpose. Any vacancy in the Board of Directors
caused by any such removal may be filled at such meeting by the stockholders
entitled to vote for the election of the Director so removed. If such
stockholders do not fill such vacancy at such meeting (or in the written
instrument effecting such removal, if such removal was effected by consent
without a meeting), such vacancy may be filled in the manner provided in Section
2.13 of these By-Laws. [Section 141(b).]
Section 2.13. Vacancies and Newly Created Directorships. If any
vacancies shall occur in the Board of Directors, by reason of death,
resignation, removal or otherwise, or if the authorized number of Directors
shall be increased, the Directors then in office shall continue to act, and such
vacancies and newly created directorships may be filled by a majority of the
Directors then in office, although less than a quorum. A Director elected to
fill a vacancy or a newly created directorship shall hold office until his
successor has been elected and qualified or until his earlier death, resignation
or removal. Any such vacancy or newly created directorship may also be filled at
any time by vote of the stockholders. [Section 223.]
Section 2.14. Compensation. The amount, if any, which each Director
shall be entitled to receive as compensation for his services as such shall be
fixed from time to time by resolution of the Board of Directors;
10
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provided that (a) no director who is an officer or employee of Clayton, Dubilier
& Rice, Inc., a Delaware corporation ("CD&R"), at any time that CD&R is
providing consulting services to the Corporation or one or more of its
subsidiaries and (b) no director who is an officer or employee of the
Corporation shall be entitled to receive any compensation for his or her
services as a Director (although such Director shall be entitled to be
reimbursed for any reasonable out-of-pocket expenses incurred in connection with
his or her services as a Director). [Section 141(h).]
Section 2.15. Reliance on Accounts and Reports, etc. A Director, or
a member of any Committee designated by the Board of Directors shall, in the
performance of his duties, be fully protected in relying in good faith upon the
records of the Corporation and upon information, opinions, reports or statements
presented to the Corporation by any of the Corporation's officers or employees,
or Committees designated by the Board of Directors, or by any other person as to
the matters the member reasonably believes are within such other person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Corporation. [Section 141(e).]
ARTICLE III
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
Section 3.01. How Constituted. The Board of Directors may, by
resolution adopted by a majority of the whole Board, designate one or more
Committees, including an Executive Committee, each such Committee to consist of
such number of Directors as from time to time may be fixed by the Board of
Directors. The Board of Directors may designate one or more Directors as
alternate members of any such Committee, who may replace any absent or
disqualified member or members at any meeting of such Committee. Thereafter,
11
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members (and alternate members, if any) of each such Committee may be designated
at the annual meeting of the Board of Directors. Any such Committee may be
abolished or re-designated from time to time by the Board of Directors. Each
member (and each alternate member) of any such Committee (whether designated at
an annual meeting of the Board of Directors or to fill a vacancy or otherwise)
shall hold office until his successor shall have been designated or until he
shall cease to be a Director, or until his earlier death, resignation or
removal. [Section 141(c).]
Section 3.02. Powers. During the intervals between the meetings of
the Board of Directors, the Executive Committee, except as otherwise provided in
this section, shall have and may exercise all the powers and authority of the
Board of Directors in the management of the property, affairs and business of
the Corporation. Each such other Committee, except as otherwise provided in this
section, shall have and may exercise such powers of the Board of Directors as
may be provided by resolution or resolutions of the Board of Directors. Neither
the Executive Committee nor any such other Committee shall have the power or
authority:
(a) to amend the Certificate of Incorporation (except that a
Committee may, to the extent authorized in the resolution or resolutions
providing for the issuance of shares of stock adopted by the Board of
Directors as provided in Section 151(a) of the General Corporation Law,
fix the designations and any of the preferences or rights of such shares
relating to dividends, redemption, dissolution, any distribution of assets
of the Corporation or the conversion into, or the exchange of such shares
for, shares of any other class or classes or any other series of the same
or any other class or classes of stock of the Corporation or fix the
number of shares of any series of stock or
12
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authorize the increase or decrease of the shares of any series),
(b) to adopt an agreement of merger or consolidation or a
certificate of ownership or merger,
(c) to recommend to the stockholders the sale, lease or exchange of
all or substantially all of the Corporation's property and assets,
(d) to recommend to the stockholders a dissolution of the
Corporation or a revocation of a dissolution, or
(e) to declare a dividend;
(f) to authorize the issuance of stock;
(g) to remove the President of the Corporation or a Director;
(h) to authorize the borrowing of funds, other than under existing
facilities, that is material to the capital structure of the Corporation;
(i) to authorize any new compensation or benefit program;
(j) to appoint or discharge the Corporation's independent public
accountants;
(k) to authorize the annual operating plan, annual capital
expenditure plan and strategic plan;
(l) to abolish or usurp the authority of the Board of Directors; or
(m) to amend these By-Laws of the Corporation.
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The Executive Committee shall have, and any such other Committee may be granted
by the Board of Directors, power to authorize the seal of the Corporation to be
affixed to any or all papers which may require it. [Section 141(c).]
Section 3.03. Proceedings. Each such Committee may fix its own rules
of procedure and may meet at such place (within or without the State of
Delaware), at such time and upon such notice, if any, as it shall determine from
time to time. Each such Committee shall keep minutes of its proceedings and
shall report such proceedings to the Board of Directors at the meeting of the
Board of Directors next following any such proceedings.
Section 3.04. Quorum and Manner of Acting. Except as may be
otherwise provided in the resolution creating such Committee, at all meetings of
any Committee the presence of members (or alternate members) constituting a
majority of the total authorized membership of such Committee shall constitute a
quorum for the transaction of business. The act of the majority of the members
present at any meeting at which a quorum is present shall be the act of such
Committee. Any action required or permitted to be taken at any meeting of any
such Committee may be taken without a meeting, if all members of such Committee
shall consent to such action in writing and such writing or writings are filed
with the minutes of the proceedings of the Committee. The members of any such
Committee shall act only as a Committee, and the individual members of such
Committee shall have no power as such. [Section 141(c).]
Section 3.05. Action by Telephonic Communications. Members of any
Committee designated by the Board of Directors may participate in a meeting of
such Committee by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and participation in a meeting
14
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pursuant to this provision shall constitute presence in person at such meeting.
[Section 141(i).]
Section 3.06. Absent or Disqualified Members. In the absence or
disqualification of a member of any Committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he or
they constitute a quorum, may unanimously appoint another member of the Board of
Directors to act at the meeting in the place of any such absent or disqualified
member. [Section 141(c).]
Section 3.07. Resignations. Any member (and any alternate member) of
any Committee may resign at any time by delivering a written notice of
resignation, signed by such member, to the Chairman or the President. Unless
otherwise specified therein, such resignation shall take effect upon delivery.
Section 3.08. Removal. Any member (and any alternate member) of any
Committee may be removed at any time, either for or without cause, by resolution
adopted by a majority of the whole Board of Directors.
Section 3.09. Vacancies. If any vacancy shall occur in any
Committee, by reason of disqualification, death, resignation, removal or
otherwise, the remaining members (and any alternate members) shall continue to
act, and any such vacancy may be filled by the Board of Directors.
ARTICLE IV
OFFICERS
Section 4.01. Number. The officers of the Corporation shall be
chosen by the Board of Directors and
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shall be a President, one or more Vice Presidents, a Secretary and a Treasurer.
The Board of Directors also may elect one or more Assistant Secretaries and
Assistant Treasurers in such numbers as the Board of Directors may determine,
and appoint such other officers as the Board of Directors deems desirable. Any
number of offices may be held by the same person. No officer need be a Director
of the Corporation. [Section 142(a), (b).]
Section 4.02. Election. Unless otherwise determined by the Board of
Directors, the officers of the Corporation shall be elected by the Board of
Directors at the annual meeting of the Board of Directors, and shall be elected
to hold office until the next succeeding annual meeting of the Board of
Directors. In the event of the failure to elect officers at such annual meeting,
officers may be elected at any regular or special meeting of the Board of
Directors. Each officer shall hold office until his successor has been elected
and qualified, or until his earlier death, resignation or removal. In the event
of a vacancy in the office of Vice President, Secretary, Assistane Secretary,
Treasurer or Assistant Treasurer, the President may appoint a replacement to
service until the next meeting of the Board of Directors where a successor is
elected and qualified. [Section 142(b).]
Section 4.03. Salaries. The salaries of all officers and agents of
the Corporation shall be fixed by the Board of Directors.
Section 4.04. Removal and Resignation; Vacancies. Any officer may be
removed for or without cause at any time by the Board of Directors. Any officer
may resign at any time by delivering a written notice of resignation, signed by
such officer, to the Board of Directors or the President. Unless otherwise
specified therein, such resignation shall take effect upon delivery. Any vacancy
occurring in any office of the Corporation by death, resignation, removal or
16
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otherwise, shall be filled by the Board of Directors. [Section 142(b), (e).]
Section 4.05. Authority and Duties of Officers. The officers of the
Corporation shall have such authority and shall exercise such powers and perform
such duties as may be specified in these By-Laws, except that in any event each
officer shall exercise such powers and perform such duties as may be required by
law. [Section 142(a).]
Section 4.06. The President. The President shall preside at all
meetings of the stockholders and directors at which he is present, shall be the
chief executive officer and the chief operating officer of the Corporation,
shall have general control and supervision of the policies and operations of the
Corporation and shall see that all orders and resolutions of the Board of
Directors are carried into effect. He shall manage and administer the
Corporation's business and affairs and shall also perform all duties and
exercise all powers usually pertaining to the office of a chief executive
officer and a chief operating officer of a corporation. He shall have the
authority to sign, in the name and on behalf of the Corporation, checks, orders,
contracts, leases, notes, drafts and other documents and instruments in
connection with the business of the Corporation, and together with the Secretary
or an Assistant Secretary, conveyances of real estate and other documents and
instruments to which the seal of the Corporation is affixed. He shall have the
authority to cause the employment or appointment of such employees and agents of
the Corporation as the conduct of the business of the Corporation may require,
to fix their compensation, and to remove or suspend any employee or agent
elected or appointed by the President or the Board of Directors. The President
shall perform such other duties and have such other powers as the Board of
Directors or the Chairman may from time to time prescribe. Notwithstanding the
foregoing, the Board of Directors in its discretion may elect separate persons
to
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hold the offices of President, chief executive officer and/or chief operating
officer and perform such duties and exercise such powers as may be assigned to
such persons by the Board of Directors.
Section 4.07. The Vice Presidents. Each Vice President shall perform
such duties and exercise such powers as may be assigned to him from time to time
by the President. In the absence of the President, the duties of the President
shall be performed and his powers may be exercised by such Vice President as
shall be designated by the President, or failing such designation, such duties
shall be performed and such powers may be exercised by each Vice President in
the order of their earliest election to that office; subject in any case to
review and superseding action by the President.
Section 4.08. The Secretary. The Secretary shall have the following
powers and duties:
(a) He shall keep or cause to be kept a record of all the
proceedings of the meetings of the stockholders and of the Board of
Directors in books provided for that purpose.
(b) He shall cause all notices to be duly given in accordance with
the provisions of these By-Laws and as required by law.
(c) Whenever any Committee shall be appointed pursuant to a
resolution of the Board of Directors, he shall furnish a copy of such
resolution to the members of such Committee.
(d) He shall be the custodian of the records and of the seal of the
Corporation and cause such seal (or a facsimile thereof) to be affixed to
all certificates representing shares of the Corporation prior to the
18
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issuance thereof and to all instruments the execution of which on behalf
of the Corporation under its seal shall have been duly authorized in
accordance with these By-Laws, and when so affixed he may attest the same.
(e) He shall properly maintain and file all books, reports,
statements, certificates and all other documents and records required by
law, the Certificate of Incorporation or these By-Laws.
(f) He shall have charge of the stock books and ledgers of the
Corporation and shall cause the stock and transfer books to be kept in
such manner as to show at any time the number of shares of stock of the
Corporation of each class issued and outstanding, the names
(alphabetically arranged) and the addresses of the holders of record of
such shares, the number of shares held by each holder and the date as of
which each became such holder of record.
(g) He shall sign (unless the Treasurer, an Assistant Treasurer or
Assistant Secretary shall have signed) certificates representing shares of
the Corporation the issuance of which shall have been authorized by the
Board of Directors.
(h) He shall perform, in general, all duties incident to the office
of secretary and such other duties as may be specified in these By-Laws or
as may be assigned to him from time to time by the Board of Directors, or
the President.
Section 4.09. The Treasurer. The Treasurer shall be the chief
financial officer of the Corporation and shall have the following powers and
duties:
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(a) He shall have charge and supervision over and be responsible for
the moneys, securities, receipts and disbursements of the Corporation, and
shall keep or cause to be kept full and accurate records of all receipts
of the Corporation.
(b) He shall cause the moneys and other valuable effects of the
Corporation to be deposited in the name and to the credit of the
Corporation in such banks or trust companies or with such bankers or other
depositaries as shall be selected in accordance with Section 8.05 of these
By-Laws.
(c) He shall cause the moneys of the Corporation to be disbursed by
checks or drafts (signed as provided in Section 8.06 of these By-Laws)
upon the authorized depositaries of the Corporation and cause to be taken
and preserved proper vouchers for all moneys disbursed.
(d) He shall render to the Board of Directors or the President,
whenever requested, a statement of the financial condition of the
Corporation and of all his transactions as Treasurer, and render a full
financial report at the annual meeting of the stockholders, if called upon
to do so.
(e) He shall be empowered from time to time to require from all
officers or agents of the Corporation reports or statements giving such
information as he may desire with respect to any and all financial
transactions of the Corporation.
(f) He may sign (unless an Assistant Treasurer or the Secretary or
an Assistant Secretary shall have signed) certificates representing stock
of the Corporation the issuance of which shall have been authorized by the
Board of Directors.
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(g) He shall perform, in general, all duties incident to the office
of treasurer and such other duties as may be specified in these By-Laws or
as may be assigned to him from time to time by the Board of Directors, or
the President.
Section 4.10. Additional Officers. The Board of Directors may
appoint such other officers and agents as it may deem appropriate, and such
other officers and agents shall hold their offices for such terms and shall
exercise such powers and perform such duties as may be determined from time to
time by the Board of Directors. The Board of Directors from time to time may
delegate to any officer or agent the power to appoint subordinate officers or
agents and to prescribe their respective rights, terms of office, authorities
and duties. Any such officer or agent may remove any such subordinate officer or
agent appointed by him, for or without cause. [Section 142(a), (b).]
Section 4.11. Security. The Board of Directors may require any
officer, agent or employee of the Corporation to provide security for the
faithful performance of his duties, in such amount and of such character as may
be determined from time to time by the Board of Directors. [Section 142(c).]
ARTICLE V
CAPITAL STOCK
Section 5.01. Certificates of Stock. The shares of the
Corporation shall be represented by certificates, provided that the Board of
Directors may provide by resolution or resolutions that some or all of any or
all classes or series of the stock of the Corporation shall be uncertificated
shares. Any such resolution shall not apply to shares represented by a
certificate until each cer-
21
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tificate is surrendered to the Corporation. Notwithstanding the adoption of such
a resolution by the Board of Directors, every holder of stock in the Corporation
represented by certificates and upon request every holder of uncertificated
shares shall be entitled to have a certificate signed by, or in the name of the
Corporation, by the President or a Vice President, and by the Treasurer or an
Assistant Treasurer, or the Secretary or an Assistant Secretary, representing
the number of shares registered in certificate form. Such certificate shall be
in such form as the Board of Directors may determine, to the extent consistent
with applicable law, the Certificate of Incorporation and these By-Laws.
[Section 158.]
Section 5.02. Signatures; Facsimile. All of such signatures on the
certificate may be a facsimile, engraved or printed, to the extent permitted by
law. In case any officer, transfer agent or registrar who has signed, or whose
facsimile signature has been placed upon a certificate shall have ceased to be
such officer, transfer agent or registrar before such certificate is issued, it
may be issued by the Corporation with the same effect as if he were such
officer, transfer agent or registrar at the date of issue. [Section 158.]
Section 5.03. Lost, Stolen or Destroyed Certificates. The Board of
Directors may direct that a new certificate be issued in place of any
certificate thereto fore issued by the Corporation alleged to have been lost,
stolen or destroyed, upon delivery to the Board of Directors of an affidavit of
the owner or owners of such certificate, setting forth such allegation. The
Board of Directors may require the owner of such lost, stolen or destroyed
certificate, or his legal representative, to give the Corporation a bond
sufficient to indemnify it against any claim that may be made against it on
account of the alleged loss, theft or destruction of any such certificate or the
issuance of any such new certificate. [Section 167.]
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Section 5.04. Transfer of Stock. Upon surrender to the Corporation
or the transfer agent of the Corporation of a certificate for shares, duly
endorsed or accompanied by appropriate evidence of succession, assignment or
authority to transfer, the Corporation shall issue a new certificate to the
person entitled thereto, cancel the old certificate and record the transaction
upon its books. Within a reasonable time after the transfer of uncertificated
stock, the Corporation shall send to the registered owner thereof a written
notice containing the information required to be set forth or stated on
certificates pursuant to Sections 151, 156, 202(a) or 218(a) of the General
Corporation Law of the State of Delaware. Subject to the provisions of the
Certificate of Incorporation and these By-Laws, the Board of Directors may
prescribe such additional rules and regulations as it may deem appropriate
relating to the issue, transfer and registration of shares of the Corporation.
[Section 151.]
Section 5.05. Record Date. In order to determine the stockholders
entitled to notice of or to vote at any meeting of stockholders or any
adjournment thereof, the Board of Directors may fix, in advance, a record date,
which record date shall not precede the date on which the resolution fixing the
record date is adopted by the Board of Directors, and which shall not be more
than sixty nor less than ten days before the date of such meeting. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting, provided,
however, that the Board of Directors may fix a new record date for the adjourned
meeting.
In order that the Corporation may determine the stockholders
entitled to consent to corporate action in writing without a meeting, the Board
of Directors may fix a record date, which record date shall not precede the date
upon which the resolution fixing the record date is adopted by the Board of
Directors, and which date shall not be more than ten days after the date upon
which the resolution fixing the record date is adopted
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by the Board of Directors. If no record date has been fixed by the Board of
Directors, the record date for determining stockholders entitled to consent to
corporate action in writing without a meeting, when no prior action by the board
of directors is required by law, shall be the first date on which a signed
written consent setting forth the action taken or proposed to be taken is
delivered to the Corporation by delivery to its registered office in the State
of Delaware, its principal place of business, or an officer or agent of the
Corporation having custody of the book in which proceedings of meetings of
stockholders are recorded. Delivery made to the Corporation's registered office
shall be by hand or by certified or registered mail, return receipt requested.
If no record date has been fixed by the Board of Directors and prior action by
the Board of Directors is required by law, the record date for determining
stockholders entitled to consent to corporate action in writing without a
meeting shall be at the close of business on the day on which the Board of
Directors adopts the resolution taking such prior action.
In order that the Corporation may determine the stockholders
entitled to receive payment of any dividend or other distribution or allotment
of any rights of the stockholders entitled to exercise any rights in respect of
any change, conversion or exchange of stock, or for the purpose of any other
lawful action, the Board of Directors may fix a record date, which record date
shall not precede the date upon which the resolution fixing the record date is
adopted, and which record date shall be not more than sixty days prior to such
action. If no record date is fixed, the record date for determining stockholders
for any such purpose shall be at the close of business on the day on which the
Board of Directors adopts the resolution relating thereto. [Section 213.]
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Section 5.06. Registered Stockholders. Prior to due surrender of a
certificate for registration of transfer, the Corporation may treat the
registered owner as the person exclusively entitled to receive dividends and
other distributions, to vote, to receive notice and otherwise to exercise all
the rights and powers of the owner of the shares represented by such
certificate, and the Corporation shall not be bound to recognize any equitable
or legal claim to or interest in such shares on the part of any other person,
whether or not the Corporation shall have notice of such claim or interests.
Whenever any transfer of shares shall be made for collateral security, and not
absolutely, it shall be so expressed in the entry of the transfer if, when the
certificates are presented to the Corporation for transfer or uncertificated
shares are requested to be transferred, both the transferor and transferee
request the Corporation to do so. [Section 159.]
Section 5.07. Transfer Agent and Registrar. The Board of Directors
may appoint one or more transfer agents and one or more registrars, and may
require all certificates representing shares to bear the signature of any such
transfer agents or registrars.
ARTICLE VI
INDEMNIFICATION
Section 6.01. Nature of Indemnity. The Corporation shall indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he is or
was or has agreed to become a director or officer of the Corporation, or is or
was serving or has agreed to serve at the request of the Corporation as a
director or officer, of another corporation, partnership, joint venture, trust
or other enterprise, or by reason of any action alleged to have been taken or
omitted in such capacity, and may indemnify any person who was or is a party or
is threatened to be made a party to such an action, suit or proceeding by reason
of the fact that he is or was or has agreed to become an employee or agent of
the Corporation, or is or was serving or has agreed to serve at the request of
the Corporation as an employee or agent of another corporation, partnership,
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joint venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him or on his behalf in connection with such action, suit or
proceeding and any appeal therefrom, if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
Corporation, and, with respect to any criminal action or proceeding had no
reasonable cause to believe his conduct was unlawful; except that in the case of
an action or suit by or in the right of the Corporation to procure a judgment in
its favor (1) such indemnification shall be limited to expenses (including
attorneys' fees) actually and reasonably incurred by such person in the defense
or settlement of such action or suit, and (2) no indemnification shall be made
in respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the Corporation unless and only to the extent that the
Delaware Court of Chancery or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Delaware Court of
Chancery or such other court shall deem proper.
The termination of any action, suit or proceeding by judgment, order
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
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faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Corporation, and, with respect to any criminal action
or proceeding, had reasonable cause to believe that his conduct was unlawful.
Section 6.02. Successful Defense. To the extent that a director,
officer, employee or agent of the Corporation has been successful on the merits
or otherwise in defense of any action, suit or proceeding referred to in Section
6.01 hereof or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
Section 6.03. Determination That Indemnification Is Proper. Any
indemnification of a director or officer of the Corporation under Section 6.01
hereof (unless ordered by a court) shall be made by the Corporation unless a
determination is made that indemnification of the director or officer is not
proper in the circumstances because he has not met the applicable standard of
conduct set forth in Section 6.01 hereof. Any indemnification of an employee or
agent of the Corporation under Section 6.01 hereof (unless ordered by a court)
may be made by the Corporation upon a determination that indemnification of the
employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in Section 6.01 hereof. Any such
determination shall be made (1) by a majority vote the of the directors who are
not parties to such action, suit or proceeding even though less than a quorum,
or (2) by a committee of such directors designated by a majority vote of such
directors, even though less than a quorum, or (3) if there are no such
directors, or if such directors so direct, by independent legal counsel in a
written opinion, or (3) by the stockholders.
Section 6.04. Advance Payment of Expenses. Expenses (including
attorneys' fees) incurred by a director
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or officer in defending any civil, criminal, administrative or investigative
action, suit or proceeding shall be paid by the Corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of the director or officer to repay such amount if
it shall ultimately be determined that he is not entitled to be indemnified by
the Corporation as authorized in this Article. Such expenses (including
attorneys' fees) incurred by other employees and agents may be so paid upon such
terms and conditions, if any, as the Board of Directors deems appropriate. The
Board of Directors may authorize the Corporation's counsel to represent such
director, officer, employee or agent in any action, suit or proceeding, whether
or not the Corporation is a party to such action, suit or proceeding.
Section 6.05. Procedure for Indemnification of Directors and
Officers. Any indemnification of a director or officer of the Corporation under
Sections 6.01 and 6.02, or advance of costs, charges and expenses to a director
or officer under Section 6.04 of this Article, shall be made promptly, and in
any event within 30 days, upon the written request of the director or officer.
If a determination by the Corporation that the director or officer is entitled
to indemnification pursuant to this Article is required, and the Corporation
fails to respond within sixty days to a written request for indemnity, the
Corporation shall be deemed to have approved such request. If the Corporation
denies a written request for indemnity or advancement of expenses, in whole or
in part, or if payment in full pursuant to such request is not made within 30
days, the right to indemnification or advances as granted by this Article shall
be enforceable by the director or officer in any court of competent
jurisdiction. Such person's costs and expenses incurred in connection with
successfully establishing his right to indemnification, in whole or in part, in
any such action shall also be indemnified by the Corporation. It shall be a
defense to any such action
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(other than an action brought to enforce a claim for the advance of costs,
charges and expenses under Section 6.04 of this Article where the required
undertaking, if any, has been received by the Corporation) that the claimant has
not met the standard of conduct set forth in Section 6.01 of this Article, but
the burden of proving such defense shall be on the Corporation. Neither the
failure of the Corporation (including its Board of Directors, its independent
legal counsel, and its stockholders) to have made a determination prior to the
commencement of such action that indemnification of the claimant is proper in
the circumstances because he has met the applicable standard of conduct set
forth in Section 6.01 of this Article, nor the fact that there has been an
actual determination by the Corporation (including its Board of Directors, its
independent legal counsel, and its stockholders) that the claimant has not met
such applicable standard of conduct, shall be a defense to the action or create
a presumption that the claimant has not met the applicable standard of conduct.
Section 6.06. Survival; Preservation of Other Rights. The foregoing
indemnification provisions shall be deemed to be a contract between the
Corporation and each director, officer, employee and agent who serves in any
such capacity at any time while these provisions as well as the relevant
provisions of the Delaware Corporation Law are in effect and any repeal or
modification thereof shall not affect any right or obligation then existing with
respect to any state of facts then or previously existing or any action, suit or
proceeding previously or thereafter brought or threatened based in whole or in
part upon any such state of facts. Such a "contract right" may not be modified
retroactively without the consent of such director, officer, employee or agent.
The indemnification and advancement of expenses provided by this
Article VI shall not be deemed exclusive of
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any other rights to which those indemnified may be entitled under any by-law,
agreement, vote of stockholders or disinterested directors or otherwise, both as
to action in his official capacity and as to action in another capacity while
holding such office, and shall continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
Section 6.07. Insurance. The Corporation shall purchase and maintain
insurance on behalf of any person who is or was or has agreed to become a
director or officer of the Corporation, or is or was serving at the request of
the Corporation as a director or officer of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
him and incurred by him or on his behalf in any such capacity, or arising out of
his status as such, whether or not the Corporation would have the power to
indemnify him against such liability under the provisions of this Article,
provided that such insurance is available on acceptable terms, which
determination shall be made by a vote of a majority of the entire Board of
Directors.
Section 6.08. Severability. If this Article or any portion hereof
shall be invalidated on any ground by any court of competent jurisdiction, then
the Corporation shall nevertheless indemnify each director or officer and may
indemnify each employee or agent of the Corporation as to costs, charges and
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement with respect to any action, suit or proceeding, whether civil,
criminal, administrative or investigative, including an action by or in the
right of the Corporation, to the fullest extent permitted by any applicable
portion of this Article that shall not have been invalidated and to the fullest
extent permitted by applicable law.
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ARTICLE VII
OFFICES
Section 7.01. Registered Office. The registered office of the
Corporation in the State of Delaware shall be located at Corporation Trust
Center, 1209 Orange Street in the City of Wilmington, County of New Castle.
Section 7.02. Other Offices. The Corporation may maintain offices or
places of business at such other locations within or without the State of
Delaware as the Board of Directors may from time to time determine or as the
business of the Corporation may require.
ARTICLE VIII
GENERAL PROVISIONS
Section 8.01. Dividends. Subject to any applicable provisions of law
and the Certificate of Incorporation, dividends upon the shares of the
Corporation may be declared by the Board of Directors at any regular or special
meeting of the Board of Directors and any such dividend may be paid in cash,
property, or shares of the Corporation's Capital Stock.
A member of the Board of Directors, or a member of any Committee
designated by the Board of Directors shall be fully protected in relying in good
faith upon the records of the Corporation and upon such information, opinions,
reports or statements presented to the Corporation by any of its officers or
employees, or Committees of the Board of Directors, or by any other person as to
matters the Director reasonably believes are within such other person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Corporation, as
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to the value and amount of the assets, liabilities and/or net profits of the
Corporation, or any other facts pertinent to the existence and amount of surplus
or other funds from which dividends might properly be declared and paid.
[Sections 172, 173.]
Section 8.02. Reserves. There may be set aside out of any funds of
the Corporation available for dividends such sum or sums as the Board of
Directors from time to time, in its absolute discretion, thinks proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the Corporation or for such other
purpose as the Board of Directors shall think conducive to the interest of the
Corporation, and the Board of Directors may similarly modify or abolish any such
reserve. [Section 171.]
Section 8.03. Execution of Instruments. The President, any Vice
President, the Secretary or the Treasurer may enter into any contract or execute
and deliver any instrument in the name and on behalf of the Corporation. The
Board of Directors or the President may authorize any other officer or agent to
enter into any contract or execute and deliver any instrument in the name and on
behalf of the Corporation. Any such authorization may be general or limited to
specific contracts or instruments.
Section 8.04. Corporate Indebtedness. No loan shall be contracted on
behalf of the Corporation, and no evidence of indebtedness shall be issued in
its name, unless authorized by the Board of Directors or the President. Such
authorization may be general or confined to specific instances. Loans so
authorized may be effected at any time for the Corporation from any bank, trust
company or other institution, or from any firm, corporation or individual. All
bonds, debentures, notes and other obligations or evidences of indebtedness of
the Corporation issued for such loans shall be made, executed and delivered as
the Board of
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Directors or the President shall authorize. When so authorized by the Board of
Directors or the President, any part of or all the properties, including
contract rights, assets, business or good will of the Corporation, whether then
owned or thereafter acquired, may be mortgaged, pledged, hypothecated or
conveyed or assigned in trust as security for the payment of such bonds,
debentures, notes and other obligations or evidences of indebtedness of the
Corporation, and of the interest thereon, by instruments executed and delivered
in the name of the Corporation.
Section 8.05. Deposits. Any funds of the Corporation may be
deposited from time to time in such banks, trust companies or other depositaries
as may be determined by the Board of Directors or the President, or by such
officers or agents as may be authorized by the Board of Directors or the
President to make such determination.
Section 8.06. Checks. All checks or demands for money and notes of
the Corporation shall be signed by such officer or officers or such agent or
agents of the Corporation, and in such manner, as the Board of Directors or the
President from time to time may determine.
Section 8.07. Sale, Transfer, etc. of Securities. To the extent
authorized by the Board of Directors or by the President, any Vice President,
the Secretary or the Treasurer or any other officers designated by the Board of
Directors or the President may sell, transfer, endorse, and assign any shares of
stock, bonds or other securities owned by or held in the name of the
Corporation, and may make, execute and deliver in the name of the Corporation,
under its corporate seal, any instruments that may be appropriate to effect any
such sale, transfer, endorsement or assignment.
Section 8.08. Voting as Stockholder. Unless otherwise determined by
resolution of the Board of Direc-
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tors, the President or any Vice President shall have full power and authority on
behalf of the Corporation to attend any meeting of stockholders of any
corporation in which the Corporation may hold stock, and to act, vote (or
execute proxies to vote) and exercise in person or by proxy all other rights,
powers and privileges incident to the ownership of such stock. Such officers
acting on behalf of the Corporation shall have full power and authority to
execute any instrument expressing consent to or dissent from any action of any
such corporation without a meeting. The Board of Directors may by resolution
from time to time confer such power and authority upon any other person or
persons.
Section 8.09. Fiscal Year. The fiscal year of the Corporation shall
commence on the first day of January of each year (except for the Corporation's
first fiscal year which shall commence on the date of incorporation) and shall
terminate in each case on the last day of December.
Section 8.10. Seal. The seal of the Corporation shall be circular in
form and shall contain the name of the Corporation, the year of its
incorporation and the words "Corporate Seal" and "Delaware". The form of such
seal shall be subject to alteration by the Board of Directors. The seal may be
used by causing it or a facsimile thereof to be impressed, affixed or
reproduced, or may be used in any other lawful manner.
Section 8.11. Books and Records; Inspection. Except to the extent
otherwise required by law, the books and records of the Corporation shall be
kept at such place or places within or without the State of Delaware as may be
determined from time to time by the Board of Directors.
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ARTICLE IX
AMENDMENT OF BY-LAWS
Section 9.01. Amendment. These By-Laws may be amended, altered or
repealed
(a) by resolution adopted by a majority of the Board of Directors at
any special or regular meeting of the Board if, in the case of such
special meeting only, notice of such amendment, alteration or repeal is
contained in the notice or waiver of notice of such meeting; or
(b) at any regular or special meeting of the stockholders if, in the
case of such special meeting only, notice of such amendment, alteration or
repeal is contained in the notice or waiver of notice of such meeting.
[Section 109(a).]
ARTICLE X
CONSTRUCTION
Section 10.01. Construction. In the event of any conflict between
the provisions of these By-Laws as in effect from time to time and the
provisions of the certificate of incorporation of the Corporation as in effect
from time to time, the provisions of such certificate of incorporation shall be
controlling.
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Exhibit 3.5
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF EXISTENCE
To Whom These Presents Come, Greeting:
I, SUE ANNE, GILROY, Secretary of State of Indiana, do hereby certify that
I am, by virtue of the laws of the State of Indiana, the custodian of the
corporate records and the proper official to execute this certificate.
I further certify that records of this office disclose that
FLEET INSURANCE MANAGEMENT INC
filed Articles of Incorporation on October 22, 1979, and is a corporation duly
organized and existing under and by virtue of the laws of the State of Indiana.
I further certify that this corporation has filed its most recent annual
report required by Indiana law with the Secretary of State, or is not yet
required to file such annual reports, and that Articles of Dissolution have not
been filed.
[SEAL] In Witness Whereof, I have hereunto set my
hand and affixed the seal of the State of
SEAL OF THE STATE OF INDIANA Indiana, at the City of Indianapolis, this
Sixteenth day of November, 1999.
1816
/s/ Sue Anne Gilroy
SUE ANNE GILROY, Secretary of State
[Illegible
Initials]
-----------
Deputy
<PAGE>
Form SSC-01
State Form 4158
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF INCORPORATION
OF
FLEET INSURANCE MANAGEMENT, INC.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
I, EDWIN J. SIMCOX, Secretary of State of the State of Indiana, hereby
certify that Articles of Incorporation of the above Corporation, in the form
prescribed by my office, prepared and signed in duplicate by the
incorporator(s), and acknowledged and verified by the same before a Notary
Public, have been presented to me at my office accompanied by the fees
prescribed by law; that I have found such Articles conform to law; that I have
endorsed my approval upon the duplicate copies of such Articles; that all fees
have been paid as required by law; that one copy of such Articles has been filed
in my office; and that the remaining copy of such Articles bearing the
endorsement of my approval and filing has been returned by me to the
incorporator(s) or his (their) representatives; all as prescribed by the
provisions of the INDIANA GENERAL CORPORATION ACT, as amended.
NOW, THEREFORE, I hereby issue to such Corporation this Certificate of
Incorporation, and further certify that its corporate existence has begun.
In Witness Whereof, I have hereunto set my hand and affixed
[SEAL] the seal of the State of Indiana, at the City of Indianapolis,
this 22nd day of OCTOBER, 1979
______________________________________________________________
EDWIN J. SIMCOX, Secretary of State
By____________________________________________________________
Deputy
<PAGE>
NOTE: This form may now also be used for incorporating pursuant to the Medical
Professional Corporation Act, the Dental Professional Corporation Act, and the
Professional Corporation Act of 1965, as well as the General Corporation Act. If
the corporation is to be formed pursuant to the authority of one of these
statutes other than the General Corporation Act, so indicate in the preamble
below by striking the references to the three inappropriate statutes.
Professional Accounting Corporations are considered to be formed pursuant to the
authority of the Indiana General Corporation Act, but subject to the provisions
of IC 23-1-13.5, and appropriate statutory reference should be made in the
preamble or Article II below.
APPROVED
AND
FILED
OCT 22 1979
/s/ Edwin J. Simcox
SECRETARY OF STATE OF INDIANA
Corporate Form No. 101 (Jan. 1977)--Page One
ARTICLES OF INCORPORATION
Edwin J. Simcox, Secretary of State of Indiana
Use White Paper--Size 8 1/2 x 11--For Inserts
Filing Requirements--Present 2 originally signed and fully executed copies to
Secretary of State, Room 155, State House, Indianapolis 46204
Recording Requirements--Recording of Articles of Incorporation in the Office of
the County Recorder is no longer required by the Indiana General
Corporation Act.
ARTICLES OF INCORPORATION
OF
FLEET INSURANCE MANAGEMENT, INC.
- --------------------------------------------------------------------------------
The undersigned incorporator or incorporators, desiring to form a
corporation (hereinafter referred to as the "Corporation") pursuant to the
provisions of the Indiana General Corporation Act (Medical Professional
Corporation Act/Dental Professional Corporation Act/Professional Corporation Act
of 1965), as amended (hereinafter referred to as the "Act"), execute the
following Articles of Incorporation.
ARTICLE I
Name
The name of the Corporation is FLEET INSURANCE MANAGEMENT, INC.
- --------------------------------------------------------------------------------
ARTICLE II
Purposes
The purposes for which the Corporation is formed are:
To initiate and continue activities relating to the operation of a
licensed insurance agency.
State Form 4159
<PAGE>
Corporate Form No. 101--Page Two
Prescribed by Edwin J. Simcox, Secretary of State
(Jan. 1977)
ARTICLE III
Period of Existence
The period during which the Corporation shall continue is perpetual.
ARTICLE IV
Resident Agent and Principal Office
Section 1. Resident Agent. The name and address of the Corporation's
Resident Agent for service of process
is C T Corporation System 1011 Merchants Bank Building
-----------------------------------------------------------------------------
(Name) (Number and Street or Building)
Indianapolis Indiana 46204
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Section 2. Principal Office. The post office address of the principal
office of the Corporation is
5001 U.S. Highway 30 West Ft. Wayne Indiana 46818
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
ARTICLE V
Authorized Shares
Section 1. Number of Shares:
The total number of shares which the Corporation is to have authority to issue
is 1000.
A. The number of authorized shares which the corporation designates as having
par value is -- with a par value of $00.00.
B. The number of authorized shares which the corporation designates as
without par value is 1000.
Section 2. Terms of Shares (if any): Such shares may be sold by the Corporation
for such an amount of consideration as shall, from time to time, be fixed by the
Board of Directors. Transfers of shares may be made only upon the books of the
Corporation by the holder named in the certificate therefore, or by his attorney
duly constituted in writing, and upon surrender of such certificate properly
endorsed by such holder; or the secretary when so authorized by the Board of
Directors, with or without the surrender of such certificate.
The Corporation shall have the right to treat the holder of record of any share
as a holder in fact thereof, and accordingly, shall not be bound to recognize
any equitable or other claims, to, or interest in, such share on the part of any
other person, whether or not it shall have express or other notice thereof.
Each share of stock shall be entitled to one vote.
<PAGE>
Corporate Form No. 101--Page Three
Prescribed by Edwin J. Simcox, Secretary of State
(Jan. 1977)
ARTICLE VI
Requirements Prior To Doing Business
The Corporation will not commence business until consideration of the
value of at least $1,000 (one thousand dollars) has been received for the
issuance of shares.
ARTICLE VII
Director(s)
Section 1. Number of Directors: The initial Board of Directors is composed
of 3 member(s). The number of directors may be from time to time fixed by the
By-Laws of the Corporation at any number. In the absence of a By-Law fixing the
number of directors, the number shall be 3.
Section 2. Names and Post Office Addresses of the Director(s): The name(s)
and post office address(es) of the initial Board of Director(s) of the
Corporation is (are):
Name Number and Street or Building City State Zip Code
---- ----------------------------- ---- ----- --------
Kenneth W. Maxfield P. O. Box 988 Fort Wayne IN 46801
W. Richard Helstrom P. O. Box 988 Fort Wayne IN 46801
B. Wade Monroe P. O. Box 988 Fort Wayne IN 46801
Section 3. Qualifications of Directors (if any):
None
<PAGE>
Corporate Form No. 101--Page Four
Prescribed by Edwin J. Simcox, Secretary of State
(Jan. 1977)
ARTICLE VIII
Incorporator(s)
The name(s) and post office address(es) of the incorporator(s) of the
Corporation is (are):
Name Number and Street or Building City State Zip Code
---- ----------------------------- ---- ----- --------
W. Richard Helstrom P. O. Box 988 Fort Wayne IN 46801
Gerald A. Burns P. O. Box 988 Fort Wayne IN 46801
ARTICLE IX
Provisions for Regulation of Business
and Conduct of Affairs of Corporation
("Powers" of the Corporation, its directors or shareholders)
Both shareholders and directors shall have the power to make, alter, amend, or
repeal the bylaws of the Corporation. Meetings of shareholders may be held
either within or without the State of Indiana if the bylaws so provide. The
books of the Corporation, except the duplicate stock register or transfer book,
may be kept either within or without the State of Indiana, at such place or
places as may be from time to time designated by the Board of Directors.
The Corporation reserves the right to alter, amend, change, or repeal any
provisions contained in these Articles of Incorporation, in the manner now or
hereafter prescribed by statute, and all rights confined upon shareholders
herein are granted subject to this reservation.
<PAGE>
Corporate Form No. 101--Page Five
Prescribed by Edwin J. Simcox, Secretary of State
(Jan. 1977)
IN WITNESS WHEREOF, the undersigned, being all of the incorporator(s)
designated in Article VIII, execute(s) these Articles of Incorporation and
certify to the truth of the facts herein stated, this 12th day of October, 1979.
/s/ W. Richard Helstrom /s/ Gerald A. Burns
- ------------------------------------ -------------------------------------
(Written Signature) (Written Signature)
W. Richard Helstrom Gerald A. Burns
- ------------------------------------ -------------------------------------
(Printed Signature) (Printed Signature)
-------------------------------------
(Written Signature)
-------------------------------------
(Printed Signature)
STATE OF INDIANA )
) ss:
COUNTY OF ALLEN )
I, the undersigned, a Notary Public duly commissioned to take
acknowledgements and administer oaths in the State of Indiana, certify that W.
Richard Helstrom & Gerald A. Burns, being both of the incorporator(s) referred
to in Article VIII of the foregoing Articles of Incorporation, personally
appeared before me; acknowledged the execution thereof; and swore to the truth
of the facts therein stated.
Witness my hand and Notarial Seal this 12th day of October, 1979
/s/ Patricia A. Dunn
-------------------------------------
(Written Signature)
Patricia A. Dunn
-------------------------------------
(Printed Signature)
My Commission Expires: Notary Public
June 8, 1982
- --------------------------------
My County of Residence: Allen
This instrument was prepared by Gerald A. Burns, Attorney at Law,
---------------
(Name)
P. O. Box 988 Fort Wayne IN 46801
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
<PAGE>
[SEAL]
SEAL OF THE STATE OF INDIANA
1816
ARTICLES OF AMENDMENT OF THE Provided by: JOSEPH H. HOGSETT
ARTICLES OF INCORPORATION SECRETARY OF STATE OF INDIANA
State Form 38333 (R5 9-91) CORPORATIONS DIVISION
State Board of Accounts Approved 1988 302 W. WASHINGTON ST RM E018
INDIANAPOLIS IN 46204
TELEPHONE: (317) 232-6576
Indiana Code 23-1-38-1 et seg.
FILING FEE $30.00
PAID
[Illegible]
SECRETARY OF STATE OF INDIANA
INSTRUCTIONS Use 8 1/2 X 11 inch white paper for inserts. Filing requirements -
Present original and one copy to address in upper right corner of this form.
- --------------------------------------------------------------------------------
ARTICLES OF AMENDMENT OF THE
ARTICLES OF INCORPORATION OF:
- --------------------------------------------------------------------------------
Fleet Insurance Management, Inc.
- --------------------------------------------------------------------------------
The undersigned officers of
Fleet Insurance Management, Inc.
- --------------------------------------------------------------------------------
(hereinafter referred to as the "Corporation") existing pursuant to the
provisions of:
(Indicate appropriate act)
|X| Indiana Business Corporation Law |_| Indiana Professional Corporation Act
of 1983
as amended (hereinafter referred to as the "Act"), desiring to give notice of
corporate action effectuating amendment of certain provisions of its Articles of
Incorporation, certify the following facts:
- --------------------------------------------------------------------------------
ARTICLE I Amendment(s)
- --------------------------------------------------------------------------------
SECTION 1 The date of incorporation of the corporation is:
October 22, 1979
- --------------------------------------------------------------------------------
SECTION 2 The name of the corporation following this amendment to the Articles
of Incorporation is:
Fleet Insurance Management, Inc.
- --------------------------------------------------------------------------------
SECTION 3
The exact text of Article(s) II of the Articles of Incorporation is now as
follows:
(a) To initiate and continue activities relating to the operation of a
licensed insurance agency; and
(b) to transact any and all lawful business for which corporations may be
incorporated under the Indiana General Corporation Act.
- --------------------------------------------------------------------------------
SECTION 4 Date of each amendment's adoption:
August 13, 1993
- --------------------------------------------------------------------------------
RECEIVED
[ILLEGIBLE]
93 AUG 26 P5:24
[ILLEGIBLE]
<PAGE>
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
ARTICLES OF AMENDMENT
To Whom These Presents Come, Greeting:
WHEREAS, there has been presented to me at this office, Articles of Amendment
for:
FLEET INSURANCE MANAGEMENT INC
and said Articles of Amendment have been prepared and signed in accordance with
the provisions of the
Indiana Business Corporation Law,
as amended.
NOW, THEREFORE, I, JOSEPH H. HOGSETT, Secretary of State of Indiana, hereby
certify that I have this day filed said articles in this office.
The effective date of these Articles of Amendment is August 26, 1993.
In Witness Whereof, I have hereunto set my
[SEAL] hand and affixed the seal of the State of
Indiana, at the City of Indianapolis, this
SEAL OF THE STATE OF INDIANA Twenty-sixth day of August , 1993
1816 /s/ Joseph H. Hogsett
------------------------------------------
JOSEPH H. HOGSETT, Secretary of State
By /s/ [Illegible]
----------------------------------------
Deputy
<PAGE>
Exhibit 3.6
================================================================================
Minutes
and
By Laws
OF
FLEET INSURANCE MANAGEMENT, INC.
INCORPORATED UNDER THE LAWS OF
INDIANA
================================================================================
COPYRIGHT 1970, BY JULIUS BLUMBERG, INC.
<PAGE>
CONSENT TO ACTION TAKEN IN LIEU OF ORGANIZATION MEETING
of
FLEET INSURANCE MANAGEMENT, INC.
--------------------------------------------------------
The undersigned being the incorporator(s) and initial stockholders of the
corporation hereby consent to and ratify the action taken to organize the
corporation as hereafter stated:
The Certificate of Incorporation filed on October 22, 1979 with the
Secretary of State of this state was approved and inserted in the record book of
the corporation, immediately preceding this consent and the by-laws.
The persons whose names appear below were appointed directors of the
corporation to serve for a period of one year and until their successors are
appointed or elected and shall qualify:
Kenneth W. Maxfield
W. Richard Helstrom
B. Wade Monroe
The persons whose names appear below were appointed officers of the
corporation to serve for a period of one year and until their successors are
appointed or elected and shall qualify:
President: Kenneth W. Maxfield
Vice-President: W. Richard Helstrom
Secretary: Gerald A. Burns
Treasurer: B. Wade Monroe
Vice-President: Timothy H. Hoffman
Assistant Secretary: Margaret S. Vegeler
By-laws, regulating the conduct of the business and affairs of the
corporation as prepared by Gerald A. Burns counsel for the corporation were
adopted and inserted in the record book, immediately following this consent.
The seal, an impression of which
appears in the margin of this consent
was adopted as the corporate seal of the
corporation, and the specimen of
certificates for shares in the form
exhibited and inserted in the record
book was adopted as the corporate stock
certificate.
consent 1
<PAGE>
The directors were authorized to issue the unsubscribed capital stock of
the corporation at such times and in such amounts as it shall determine, and to
accept in payment thereof cash, labor done, personal property, real property or
leases thereof, or such other property as the board may deem necessary for the
business of the corporation.
NORTH AMERICAN VAN LINES, INC.
Dated November 12, 1979
By: /s/ Martin A. Weissert
--------------------------------
Martin A. Weissert, Secretary
/s/ W. Richard Helstrom
- ------------------------------
W. Richard Helstrom
Incorporator --------------------------------
/s/ Gerald A. Burns
- ------------------------------ --------------------------------
Gerald A. Burns
Incorporator
A true copy of each of the following papers referred to in the foregoing
consent is appended hereto.
Specimen stock certificate
By-Laws
consent 2
<PAGE>
================================================================================
====NUMBER==== ====SHARES====
[GRAPHIC] ***1000***
============== ==============
INCORPORATED UNDER THE LAWS OF THE STATE OF INDIANA
Fleet Insurance Management Inc.
SPECIMEN
This Certifies that North American Van Lines, Inc. is the owner of ONE THOUSAND
(1000)************************ fully paid and non-assessable Shares of the above
Corporation transferable only on the books of the Corporation by the holder
hereof in person or by duly authorized Attorney upon surrender of this
Certificate properly endorsed.
In Witness Whereof, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and to be sealed with the Seal of the
Corporation.
Dated October 18, 1979
----------------
___________________________ ____________________________
SECRETARY-TREASURER PRESIDENT
================================================================================
EXCELSIOR-LEGAL STATIONERY CO., INC., 62 WHITE ST. NYC 10013
<PAGE>
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations. Additional abbreviations may also
be used though not in the list.
TEN COM --as tenants in common
TEN ENT --as tenants by the entireties
JT TEN --as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT --________Custodian_________(Minor)
under Uniform Gifts to Minors Act __________(State)
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
--------------------------------------
--------------------------------------
For value received, the undersigned hereby sells, assigns and transfers unto
______________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
________________________________________________________________________________
__________________________________________________________________________Shares
represented by the within Certificate, and hereby irrevocably constitutes and
appoints ________________________________________________________ Attorney to
transfer the said Shares on the books of the within-named Corporation with
full power of substitution in the premises.
Dated________________________________
in presence of _____________________________________
_____________________________________
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the certificate in every particular without alteration
or enlargement, or any change whatever.
<PAGE>
BY-LAWS
OF
FLEET INSURANCE MANAGEMENT, INC.
ARTICLE I - OFFICES
The principal office of the corporation in the State of Indiana shall be
located in the City of Fort Wayne County of Allen. The corporation may have such
other offices, either within or without the State of incorporation as the board
of directors may designate or as the business of the corporation may from time
to time require.
ARTICLE II - STOCKHOLDERS
1. ANNUAL MEETING.
The annual meeting of the stockholders shall be held on the 1st day of
November in each year, beginning with the year 1980 at the hour 9:00 o'clock
A.M., for the purpose of electing directors and for the transaction of such
other business as may come before the meeting. If the day fixed for the annual
meeting shall be a legal holiday such meeting shall be held on the next
succeeding business day.
2. SPECIAL MEETINGS.
Special meetings of the stockholders, for any purpose or purposes, unless
otherwise prescribed by statute, may be called by the president or by the
directors, and shall be called by the president at the request of the holders of
not less than 50 per cent of all the outstanding shares of the corporation
entitled to vote at the meeting.
3. PLACE OF MEETING.
The directors may designate any place, either within or without the State
unless otherwise prescribed by statute, as the place of meeting for any annual
meeting or for any special meeting called by the directors. A waiver of notice
signed by all stockholders entitled to vote at a meeting may designate
By-Laws 1
<PAGE>
any place, either within or without the state unless otherwise prescribed by
statute, as the place for holding such meeting. If no designation is made, or if
a special meeting be otherwise called, the place of meeting shall be the
principal office of the corporation.
4. NOTICE OF MEETING.
Written or printed notice stating the place, day and and hour of the
meeting and, in case of a special meeting, the purpose or purposes for which the
meeting is called, shall be delivered not less than ten (10) nor more than
thirty (30) days before the date of the meeting, either personally or by mail,
by or at the direction of the president, or the secretary, or the officer or
persons calling the meeting, to each stockholder of record entitled to vote at
such meeting. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail, addressed to the stockholder at his address
as it appears on the stock transfer books of the corporation, with postage
thereon prepaid.
5. CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE.
For the purpose of determining stockholders entitled to notice of or to
vote at any meeting of stockholders or any adjournment thereof, or stockholders
entitled to receive payment of any dividend, or in order to make a determination
of stockholders for any other proper purpose, the directors of the corporation
may provide that the stock transfer books shall be closed for a stated period
but not to exceed, in any case, thirty (30) days. If the stock transfer books
shall be closed for the purpose of determining stockholders entitled to notice
of or to vote at a meeting of stockholders, such books shall be closed for at
least ten (10) days immediately preceding such meeting. In lieu of closing the
stock transfer books, the directors may fix in advance a date as the record date
for any such determination of stockholders, such date in any case to be not more
than thirty (30) days and, in case of a meeting of stockholders, not less than
thirty (30) days prior to the date on which the particular action requiring such
determination of stockholders is to be taken. If the stock transfer books are
not closed and no record date is fixed for the determination of stockholders
entitled to notice of or to vote at a meeting of stockholders, or stockholders
entitled to receive payment of a dividend, the date on which notice of the
meeting is mailed or the date on which the resolution of the directors declaring
such dividend is adopted, as the case may be, shall be the record date for such
determination of stockholders. When a determination of stockholders entitled to
vote at any meeting of stockholders
By-Laws 2
<PAGE>
has been made as provided in this section, such determination shall apply to any
adjournment thereof.
6. VOTING LISTS.
The officer or agent having charge of the stock transfer books for shares
of the corporation shall make, at least ten (10) days before each meeting of
stockholders, a complete list of the stockholders entitled to vote at such
meeting, or any adjournment thereof, arranged in alphabetical order, with the
address of and the number of shares held by each, which list, for a period of
ten (l0) days prior to such meeting, shall be kept on file at the principal
office of the corporation and shall be subject to inspection by any stockholder
at any time during usual business hours. Such list shall also be produced and
kept open at the time and place of the meeting and shall be subject to the
inspection of any stockholder during the whole time of the meeting. The original
stock transfer book shall be prima facie evidence as to who are the stockholders
entitled to examine such list or transfer books or to vote at the meeting of
stockholders.
7. QUORUM.
At any meeting of stockholders 50 per cent of the outstanding shares of
the corporation entitled to vote, represented in person or by proxy, shall
constitute a quorum at a meeting of stockholders. If less than said number of
the outstanding shares are represented at a meeting, a majority of the shares so
represented may adjourn the meeting from time to time without further notice. At
such adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally notified. The stockholders present at a duly organized meeting may
continue to transact business until adjournment, nothwithstanding the withdrawal
of enough stockholders to leave less than a quorum.
8. PROXIES.
At all meetings of stockholders, a stockholder may vote by proxy executed
in writing by the stockholder or by his duly authorized attorney in fact. Such
proxy shall be filed with the secretary of the corporation before or at the time
of the meeting.
9. VOTING.
Each stockholder entitled to vote in accordance with the terms and
provisions of the certificate of incorporation and these by-laws shall be
entitled to one vote, in person or by
By-Laws 3
<PAGE>
proxy, for each share of stock entitled to vote held by such stockholders. Upon
the demand of any stockholder, the vote for directors and upon any question
before the meeting shall be by ballot. All elections for directors shall be
decided by plurality vote; all other questions shall be decided by majority vote
except as otherwise provided by the Certificate of Incorporation or the laws of
this State.
10. ORDER OF BUSINESS.
The order of business at all meetings of the stockholders, shall be as
follows:
1. Roll Call.
2. Proof of notice of meeting or waiver of notice.
3. Reading of minutes of preceding meeting.
4. Reports of Officers.
5. Reports of Committees.
6. Election of Directors.
7. Unfinished Business.
8. New Business.
11. INFORMAL ACTION BY STOCKHOLDERS.
Unless otherwise provided by law, any action required to be taken at a
meeting of the shareholders, or any other action which may be taken at a meeting
of the shareholders, may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall be signed by all of the shareholders
entitled to vote with respect to the subject matter thereof.
By-Laws 4
<PAGE>
ARTICLE III - BOARD OF DIRECTORS
1. GENERAL POWERS.
The business and affairs of the corporation shall be managed by its board
of directors. The directors shall in all cases act as a board, and they may
adopt such rules and regulations for the conduct of their meetings and the
management of the corporation, as they may deem proper, not inconsistent with
these by-laws and the laws of this State.
2. NUMBER, TENURE AND QUALIFICATIONS.
The number of directors of the corporation shall be three (3). Each
director shall hold office until the next annual meeting of stockholders and
until his successor shall have been elected and qualified.
3. REGULAR MEETINGS.
A regular meeting of the directors, shall be held without other notice
than this by-law immediately after, and at the same place as, the annual meeting
of stockholders. The directors may provide, by resolution, the time and place
for the holding of additional regular meetings without other notice than such
resolution.
4. SPECIAL MEETINGS.
Special meetings of the directors may be called by or at the request of
the president or any two directors. The person or persons authorized to call
special meetings of the directors may fix the place for holding any special
meeting of the directors called by them.
5. NOTICE.
Notice of any special meeting shall be given at least ten (10) days
previously thereto by written notice delivered personally, or by telegram or
mailed to each director at his business address. If mailed, such notice shall be
deemed to be delivered when deposited in the United States mail so addressed,
with postage thereon prepaid. If notice be given by telegram, such notice shall
be deemed to be delivered when the telegram is delivered to the telegraph
company. The attendance of a director at a meeting shall constitute a waiver of
notice of such meeting, except where a director attends a meeting for the
express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened.
By-Laws 5
<PAGE>
6. QUORUM.
At any meeting of the directors, two (2) shall constitute a quorum for the
transaction of business, but if less than said number is present at a meeting, a
majority of the directors present may adjourn the meeting from time to time
without further notice.
7. MANNER OF ACTING.
The act of the majority of the directors present at a meeting at which a
quorum is present shall be the act of the directors.
8. NEWLY CREATED DIRECTORSHIPS AND VACANCIES.
Newly created directorships resulting from an increase in the number of
directors and vacancies occurring in the board for any reason except the removal
of directors without cause may be filled by a vote of a majority of the
directors then in office, although less than a quorum exists. Vacancies
occurring by reason of the removal of directors without cause shall be filled by
vote of the stockholders. A director elected to fill a vacancy caused by
resignation, death or removal shall be elected to hold office for the unexpired
term of his predecessor.
9. REMOVAL OF DIRECTORS.
Any or all of the directors may be removed for cause by vote of the
stockholders or by action of the board. Directors may be removed without cause
only by vote of the stockholders.
10. RESIGNATION.
A director may resign at any time by giving written notice to the board,
the president or the secretary of the corporation. Unless otherwise specified in
the notice, the resignation shall take effect upon receipt thereof by the board
or such officer, and the acceptance of the resignation shall not be necessary to
make it effective.
11. COMPENSATION.
No compensation shall be paid to directors, as such, for their services,
but by resolution of the board a fixed sum and expenses for actual attendance at
each regular or special meeting of the board may be authorized. Nothing herein
contained shall be construed to preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.
By-Laws 6
<PAGE>
12. PRESUMPTION OF ASSENT.
A director of the corporation who is present at a meeting of the directors
at which action on any corporate matter is taken shall be presumed to have
assented to the action taken unless his dissent shall be entered in the minutes
of the meeting or unless he shall file his written dissent to such action with
the person acting as the secretary of the meeting before the adjournment thereof
or shall forward such dissent by registered mail to the secretary of the
corporation immediately after the adjournment of the meeting. Such right to
dissent shall not apply to a director who voted in favor of such action.
13. EXECUTIVE AND OTHER COMMITTEES.
The board, by resolution, may designate from among its members an
executive committee and other committees, each consisting of three or more
directors. Each such committee shall serve at the pleasure of the board.
14. INFORMAL ACTION BY DIRECTORS.
Unless otherwise provided by law, any action required to be taken at a
meeting of the directors, or any other action which may be taken at a meeting of
the directors, may be taken without a meeting if a consent in writing, setting
forth the action so taken, shall be signed by all the directors entitled to vote
with respect to the subject matter thereof.
By-Laws 7
<PAGE>
ARTICLE IV - OFFICERS
1. NUMBER.
The officers of the corporation shall be a president, a vice-president, a
secretary, an assistant secretary, and a treasurer, each of whom shall be
elected by the directors. Such other officers and assistant officers as may be
deemed necessary may be elected or appointed by the directors.
2. ELECTION AND TERM OF OFFICE.
The officers of the corporation to be elected by the directors shall be
elected annually at the first meeting of the directors held after each annual
meeting of the stockholders. Each officer shall hold office until his successor
shall have been duly elected and shall have qualified or until his death or
until he shall resign or shall have been removed in the manner hereinafter
provided.
3. REMOVAL.
Any officer or agent elected or appointed by the directors may be removed
by the directors whenever in their judgment the best interests of the
corporation would be served thereby, but such removal shall be without prejudice
to the contract rights, if any, of the person so removed.
4. VACANCIES.
A vacancy in any office because of death, resignation, removal,
disqualification or otherwise, may be filled by the directors for the unexpired
portion of the term.
5. PRESIDENT.
The president shall be the principal executive officer of the corporation
and, subject to the control of the directors, shall in general supervise and
control all of the business and affairs of the corporation. He shall, when
present, preside at all meetings of the stockholders and of the directors. He
may sign, with the secretary or, any other proper officer of the corporation
thereunto authorized by the directors, certificates for shares of the
corporation, any deeds, mortgages, bonds, contracts, or other instruments which
the directors have authorized to be executed, except in cases where the signing
and execution thereof shall be expressly delegated by the directors or by these
by-laws to some other officer or agent of the corporation, or shall be required
by law to be otherwise signed or executed; and in general shall
By-Laws 8
<PAGE>
perform all duties incident to the office of president and such other duties as
may be prescribed by the directors from time to time.
6. VICE-PRESIDENT.
In the absence of the president or in event of his death, inability or
refusal to act, the vice-president shall perform the duties of the president,
and when so acting, shall have all the powers of and be subject to all the
restrictions upon the president. The vice-president shall perform such other
duties as from time to time may be assigned to him by the President or by the
directors.
7. SECRETARY.
The secretary shall keep the minutes of the stockholders' and of the
directors' meetings in one or more books provided for that purpose, see that all
notices are duly given in accordance with the provisions of these by-laws or as
required, be custodian of the corporate records and of the seal of the
corporation and keep a register of the post office address of each stockholder
which shall be furnished to the secretary by such stockholder, have general
charge of the stock transfer books of the corporation and in general perform all
duties incident to the office of secretary and such other duties as from time to
time may be assigned to him by the president or by the directors. The Assistant
Secretary shall have the authority to act in place of the Secretary and to
assume all responsibilities and in general perform all duties incident to the
office of Secretary in the Secretary's absence or during a vacancy in that
office.
[ILLEGIBLE LINE]
with such surety or sureties as the directors shall determine. He shall have
charge and custody of and be responsible for all funds and securities of the
corporation; receive and give receipts for moneys due and payable to the
corporation from any source whatsoever, and deposit all such moneys in the name
of the corporation in such banks, trust companies or other depositories as shall
be selected in accordance with these by-laws and in general perform all of the
duties incident to the office of treasurer and such other duties as from time to
time may be assigned to him by the president or by the directors.
9. SALARIES.
The salaries of the officers shall be fixed from time to time by the
directors and no officer shall be prevented from receiving such salary by reason
of the fact that he is also a director of the corporation.
By-Laws 9
<PAGE>
10. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
(a) Each director and officer, elected or appointed, shall be entitled, without
the necessity of further act or deed on the part of himself or the corporation
to be indemnified by the corporation from and against any and all claims,
liabilities, fines or penalties, whether or not reduced to judgment, imposed
upon or asserted against him by reason of his being or having been a director or
officer of the corporation or otherwise, and also from and against all costs and
expenses (including, without any limitation of the foregoing, fees and
disbursements of counsel) reasonably incurred by him as a result thereof,
whether in settlement of the same or in connection with any action, suit or
proceeding to which he is now or may hereafter become or be made a party for a
like reason; provided, however, that such indemnification shall not extend to
any instance in which
(i) any liability, fine or penalty is imposed upon him by final judgment
of a court of competent jurisdiction or the claims against him are
dismissed or barred upon the ground of any statute of limitations or
of any other technical defense not going to the merits of the claims
involved, unless the court shall find that the liability, fine or
penalty so imposed or the claims so dismissed or barred resulted
from action taken or omitted to be taken by him in good faith and
without negligence or misconduct in the performance of his duty or,
in the absence of such a finding, unless counsel selected or
approved by the board of directors shall have advised the
corporation that in the opinion of such counsel such liability, fine
or penalty or such claims resulted from action taken or omitted to
be taken by him in good faith and without negligence or misconduct
in the performance of his duty; or
(ii) any amount is paid or is to be paid by him to the corporation in or
in connection with the settlement of any action, suit, proceeding or
claim, with or without the entry of any judgment therein or in
respect thereof by a court of competent jurisdiction; or
By-Laws 9(a)
<PAGE>
(iii) any amount is paid or is to be paid by him to any party other than
the corporation in or in connection with the settlement of any
action, suit, proceeding or claim, with or without the entry of any
judgment therein or in respect thereof by a court of competent
jurisdiction, unless such court shall find that such director or
officer acted in good faith and without negligence or misconduct in
the performance of his duty, or unless, in the absence of such
finding, the corporation shall be advised by counsel selected or
approved by the board that in the opinion of such counsel such
action, suit, proceeding or claim is without substantial merit or
that such director or officer acted in good faith and without
negligence or misconduct in the performance of his duty with respect
to the matters involved therein, but in no event shall the amount of
the indemnity under this subdivision (iii) exceed the expense which
might, in the judgment of the board, reasonably be incurred by such
director or officer in conducting his defense to a final conclusion;
nor shall such indemnification extend to any costs or expenses in connection
with any case referred to in clause (i), (ii) and (iii) above.
(b) The corporation's obligation aforesaid (i) shall exist whether or not a
director or officer is or has continued to be a director or officer of the
corporation at or up to the time any costs or expenses are incurred or any
claims or liabilities arise or any settlement is effected, (ii) shall inure to
the benefit of the heirs, executors or administrators of such director or
officer, (iii) shall not be exclusive of any other rights to which he or they
may be entitled as a matter of law, and (iv) may, but need not, be evidenced by
a writing to be delivered to him in connection with his election or appointment
as such director and/or officer and in consideration of his acceptance of the
same. Notwithstanding any repeal of this Section or other amendment of these
By-Laws affecting or purporting to affect this Section or the indemnification
herein provided, such obligation shall be binding upon the corporation (subject
only to the exceptions hereinbefore set forth) as to all matters which occur
during or are allocable to the period prior to any such repeal or amendment and
shall cover all
By-Laws 9(b)
<PAGE>
claims, liabilities, costs and expenses at any time connected therewith, and
also any settlement thereof, as hereinabove stated.
(c) In determining whether and to what extent, if any, a director or officer of
the corporation is entitled to indemnification hereunder or under any writing
aforesaid and in making any payments pursuant to such determination, the board
of directors and/or each director and officer, whether or not interested in any
such determination or payment, may rely upon, and shall be protected by, an
opinion of counsel selected or approved by the board, which counsel may, but
need not, be counsel advising as above mentioned. In the selection of counsel
for any one or more of the purposes hereinabove set forth, the determination of
the board shall be final and binding, notwithstanding that one or more, or all,
of the directors taking part in such selection are or were interested in any
payment or indemnification to which claim is made hereunder.
By-Laws 9(c)
<PAGE>
ARTICLE V - CONTRACTS, LOANS, CHECKS AND DEPOSITS
1. CONTRACTS.
The directors may authorize any officer or officers, agent or agents, to
enter into any contract or execute and deliver any instrument in the name of and
on behalf of the corporation, and such authority may be general or confined to
specific instances.
2. LOANS.
No loans shall be contracted on behalf of the corporation and no evidences
of indebtedness shall be issued in its name unless authorized by a resolution of
the directors. Such authority may be general or confined to specific instances.
3. CHECKS, DRAFTS, ETC.
All checks, drafts or other orders for the payment of money, notes or
other evidences of indebtedness issued in the name of the corporation, shall be
signed by such officer or officers, agent or agents of the corporation and in
such manner as shall from time to time be determined by resolution of the
directors.
4. DEPOSITS.
All funds of the corporation not otherwise employed shall be deposited
from time to time to the credit of the corporation in such banks, trust
companies or other depositaries as the directors may select.
ARTICLE VI - CERTIFICATES FOR SHARES AND THEIR TRANSFER
1. CERTIFICATES FOR SHARES.
Certificates representing shares of the corporation shall be in such form
as shall be determined by the directors. Such certificates shall be signed by
the president and by the secretary or by such other officers authorized by law
and by the directors. All certificates for shares shall be consecutively
numbered or otherwise identified. The name and address of the stockholders, the
number of shares and date of issue, shall be entered on the stock transfer books
of the corporation. All certificates surrendered to the corporation for transfer
shall be canceled and no new certificate shall be issued until the
By-Laws 10
<PAGE>
former certificate for a like number of shares shall have been surrendered and
canceled, except that in case of a lost, destroyed or mutilated certificate a
new one may be issued therefor upon such terms and indemnity to the corporation
as the directors may prescribe.
2. TRANSFERS OF SHARES.
(a) Upon surrender to the corporation or the transfer agent of the
corporation of a certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it shall be the
duty of the corporation to issue a new certificate to the person entitled
thereto, and cancel the old certificate; every such transfer shall be entered on
the transfer book of the corporation which shall be kept at its principal
office.
(b) The corporation shall be entitled to treat the holder of record of any
share as the holder in fact thereof, and, accordingly, shall not be bound to
recognize any equitable or other claim to or interest in such share on the part
of any other person whether or not it shall have express or other notice
thereof, except as expressly provided by the laws of this state.
ARTICLE VII - FISCAL YEAR
The fiscal year of the corporation shall begin on the first Sunday
following the last Saturday in December of each year.
ARTICLE VIII - DIVIDENDS
The directors may from time to time declare, and the corporation may pay,
dividends on its outstanding shares in the manner and upon the terms and
conditions provided by law.
ARTICLE IX - SEAL
The directors shall provide a corporate seal which shall be circular in
form and shall have inscribed thereon the name of the corporation, the state of
incorporation, year of incorporation and the words, "Corporate Seal".
By-Laws 11
<PAGE>
ARTICLE X - WAIVER OF NOTICE
Unless otherwise provided by law, whenever any notice is required to be
given to any stockholder or director of the corporation under the provisions of
these by-laws or under the provisions of the articles of incorporation, a waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent to
the giving of such notice.
ARTICLE XI - AMENDMENTS
These by-laws may be altered, amended or repealed and new by-laws may be
adopted by a vote of the stockholders representing a majority of all the shares
issued and outstanding, at any annual stockholders' meeting or at any special
stockholders' meeting when the proposed amendment has been set out in the notice
of such meeting.
These by-laws may also be altered, amended or repealed and new by-laws may
be adopted by a vote of the majority of the directors at either annual meeting,
a special meeting, or by consent as provided in Article III, Section 14 hereof.
By-Laws 12
<PAGE>
Exhibit 3.7
State of Delaware
Office of the Secretary of State PAGE 1
--------------------------------
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THE ATTACHED ARE TRUE AND CORRECT COPIES OF ALL DOCUMENTS ON FILE OF
"FRONTRUNNER WORLDWIDE, INC." AS RECEIVED AND FILED IN THIS OFFICE.
THE FOLLOWING DOCUMENTS HAVE BEEN CERTIFIED:
CERTIFICATE OF INCORPORATION, FILED THE FOURTH DAY OF OCTOBER, A.D. 1993,
AT 10 O'CLOCK A.M.
[SEAL OF THE SECRETARY'S OFFICE
STATE OF DELAWARE]
/s/ Edward J. Freel, Secretary of State
---------------------------------------
Edward J. Freel, Secretary of State
2353613 8100H AUTHENTICATION: 0056861
991461083 DATE: 11-01-99
<PAGE>
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 10:00 AM 10/04/1993
932775078 - 2353613
CERTIFICATE OF INCORPORATION
OF
FrontRunner Worldwide, Inc.
*************************************************************
1. The name of the corporation is FrontRunner Worldwide, Inc.
2. The address of its registered office in the State of Delaware is
Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County
of New Castle. The name of its registered agent at such address is The
Corporation Trust Company.
3. The nature of the business or purposes to be conducted or promoted are:
To provide world-wide transportation and related services, or to arrange
such services;
To engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of Delaware; and
In general, to possess and exercise all the powers and privileges granted
by the General Corporation Law of Delaware or by any other law of Delaware or by
this Certificate of Incorporation together with any powers incidental thereto,
so far as such powers and privileges are necessary or convenient to the conduct,
promotion or attainment of the business or purposes of the corporation.
4. The total number of shares of stock which the corporation shall have
authority to issue is 1,000, which shall be common stock with full voting
powers. The par value of each of such shares is One Dollar ($1.00) amounting in
the aggregate to One Thousand Dollars ($1,000.00).
<PAGE>
5. The name and mailing address of each incorporator is
NAME MAILING ADDRESS
---- ---------------
Elliot R. Lewis 5001 U.S. Highway 30 West
Fort Wayne, Indiana 46818
6. The name and mailing address of each person who is to serve as a
director until the first annual meeting of the stockholders or until a successor
is elected and qualified, is as follows:
NAME MAILING ADDRESS
---- ---------------
R. Alan Brogan 5001 U.S. Highway 30 West
Fort Wayne, Indiana 46818
Gerald A. Burns 5001 U.S. Highway 30 West
Fort Wayne, Indiana 46818
Ronald L. Milewski 5002. U.S. Highway 30 West
Fort Wayne, Indiana 46818
7. The corporation is to have perpetual existence.
8. In furtherance and not in limitation of the powers conferred by
statute, the board of directors is expressly authorized:
To make, alter or repeal the by-laws of the corporation.
When and as authorized by the stockholders in accordance with law, to
sell, lease or exchange all or substantially all of the property and assets of
the corporation, including its good will and its corporate franchises, upon such
terms and conditions and for such consideration, which may consist in whole or
in part of money or property including shares of stock in, and/or other
securities of, any other corporation or corporations, as its board of
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<PAGE>
directors shall deem expedient and for the best interests of the corporation.
9. The corporation reserves the right to amend, alter, change or repeal
any provision contained in this Certificate of Incorporation, in the manner now
or hereafter prescribed by statute, and all rights conferred upon stockholders
herein are granted subject to this reservation.
10. A director of the corporation shall not be personally liable to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director except for liability (i) for any breach of the director's
duty of loyalty to the corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the Delaware General Corporation
Law, or (iv) for any transaction from which the director derived any improper
personal benefit.
I, THE UNDERSIGNED, being the sole incorporator herein before named, for
the purpose of forming a corporation pursuant to the General Corporation Law of
the State of Delaware, do make this Certificate, hereby declaring and certifying
that this is my act and deed and the facts herein stated are true, and
accordingly have hereunto set my hand this 28th day of September, 1993.
/s/ Elliot R. Lewis
------------------------------------
Elliot R. Lewis
3
<PAGE>
Exhibit 3.8
BY-LAWS
OF
FrontRunner Worldwide, Inc.
ARTICLE I
OFFICES
Section 1. The registered office shall be in the City of Wilmington,
County of New Castle, State of Delaware.
Section 2. The corporation may also have offices at such other
places both within and without the State of Delaware as the board of directors
may from time to time determine or the business of the corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. All meetings of the stockholders for the election of
directors shall be held in the City of Fort Wayne, State of Indiana, at such
place as may be fixed from time to time by the board of directors, or at such
other place either within or without the State of Delaware as shall be
designated from time to time by the board of directors and stated in the notice
of the meeting. Meetings of stockholders for any other purpose may be held at
such time and place, within or without the State of Delaware, as shall be stated
in the notice of the meeting or in a duly executed waiver of notice thereof.
Section 2. Annual meetings of stockholders, commencing with the year
1994, shall be held on the third Tuesday in May if not a legal holiday, and if a
legal holiday, then on the next secular day following, at 10:00 a.m., or at such
other date and time as shall be designated from time to time by the board of
directors and stated in the notice of the meeting, at which they shall elect by
a plurality vote a board of directors, and transact such other business as may
properly be brought before the meeting.
Section 3. Written notice of the annual meeting stating the place,
date and hour of the meeting shall be given to each stockholder entitled to vote
at such meeting not less than 10 nor more than 60 days before the date of the
meeting.
Section 4. The officer who has charge of the stock ledger of the
corporation shall prepare and make, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
<PAGE>
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
ten days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder who is
present.
Section 5. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the certificate of
incorporation, may be called by the president and shall be called by the
president or secretary at the request in writing of a majority of the board of
directors, or at the request in writing of stockholders owning a majority in
amount of the entire capital stock of the corporation issued and outstanding and
entitled to vote. Such request shall state the purpose or purposes of the
proposed meeting.
Section 6. Written notice of a special meeting stating the place,
date and hour of the meeting and the purpose or purposes for which the meeting
is called, shall be given not less than 10 nor more than 60 days before the date
of the meeting, to each stockholder entitled to vote at such meeting.
Section 7. Business transacted at any special meeting of
stockholders shall be limited to the purposes stated in the notice.
Section 8. The holders of a majority of the stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall constitute a quorum at all meetings of the stockholders for the
transaction of business except as otherwise provided by statute or by the
certificate of incorporation. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders entitled to
vote thereat, present in person or represented by proxy, shall have power to
adjourn the meeting from time to time, without notice other than announcement at
the meeting, until a quorum shall be present or represented. At such adjourned
meeting at which a quorum shall be present or represented any business may be
transacted which might have at the meeting as originally notified. If the
adjournment is for more than thirty days, or if after the adjournment a new
record date is fixed for the adjourned meeting, a notice of the adjourned
meeting shall be given to each stockholder of record entitled to vote at the
meeting.
Section 9. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which by express provision of the statutes or of
the certificate of
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incorporation, a different vote is required in which case such express provision
shall govern and control the decision of such question.
Section 10. Unless otherwise provided in the certificate of
incorporation each stockholder shall at every meeting of the stockholders be
entitled to one vote in person or by proxy for each share of the capital stock
having voting power held by such stockholder, but no proxy shall be voted on
after three years from its date, unless the proxy provides for a longer period.
Section 11. Unless otherwise provided in the certificate of
incorporation or otherwise provided by statute, any action required to be taken
at any annual or special meeting of stockholders of the corporation, or any
action which may be taken at any annual or special meeting of such stockholders,
may be taken without a meeting, without prior notice and without a vote, if a
consent in writing, setting forth the action so taken, shall be signed by the
holders of outstanding stock having not less than the minimum number of votes
that would be necessary to authorize or take such action at a meeting at which
all shares entitled to vote thereon were present and voted. Prompt notice of the
taking of the corporate action without a meeting by less than unanimous written
consent shall be given to those stockholders who have not consented in writing.
ARTICLE III
DIRECTORS
Section 1. The number of directors which shall constitute the
initial board shall be three. Thereafter, the number of directors which shall
constitute the whole board shall be no less than three (3) and no greater than
fifteen (15) at the election of the stockholders. The directors shall be elected
at the annual meeting of the stockholders, except as provided in Section 2 of
this Article. Each director elected shall hold office until his successor is
elected and qualified, or until his earlier resignation or removal. Directors
need not be stockholders.
Section 2. Vacancies and newly created directorships resulting from
any increase in the authorized number of directors may be filled by a majority
of the directors then in office, though less than a quorum, or by a sole
remaining director, and the directors so chosen shall hold office until the next
annual election and until their successors are duly elected and shall qualify,
unless sooner displaced. If there are no directors in office, then an election
of directors may be held in the manner provided by statute.
Section 3. The business of the corporation shall be managed by or
under the direction of its board of directors which may exercise all such powers
of the corporation and do all such
3
<PAGE>
lawful acts and things as are not by statute or by the certificate of
incorporation or by these by-laws directed or required to be exercised or done
by the stockholders.
Section 4. The board of directors of the corporation may hold
meetings, both regular and special, either within or without the State of
Delaware.
Section 5. The first meeting of each newly elected board of
directors shall be held at such time and place as shall be fixed by the vote of
the stockholders at the annual meeting and no notice of such meeting shall be
necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present. In the event of the failure of the
stockholders to fix the time or place of such first meeting of the newly elected
board of directors, or in the event such meeting is not held at the time and
place so fixed by the stockholders, the meeting may be held at such time and
place as shall be specified in a notice given as hereinafter provided for
special meetings of the board of directors, or as shall be specified in a
written waiver signed by all of the directors.
Section 6. Regular meetings of the board of directors may be held
without notice at such time and at such place as shall from time to time be
determined by the board.
Section 7. Special meetings of the board may be called by the
president, by the secretary, or by any two (2) directors without utilizing the
president or secretary to do so, on 5 days' notice to each director, either
personally or by mail or by telegram; special meetings shall be called by the
president or secretary in like manner and on like notice on the written request
of two directors unless the board consists of only one director; in which case
special meetings shall be called by the president or secretary in like manner
and on like notice on the written request of the sole director.
Section 8. At all meetings of the board, one-third of the directors
shall constitute a quorum for the transaction of business, except that when the
board is comprised of less than four (4) directors, a majority of the directors
shall constitute a quorum for the transaction of business, and the act of a
majority of the directors present at any meeting at which there is a quorum
shall be the act of the board of directors, except as may be otherwise
specifically provided by statute or by the certificate of incorporation. If a
quorum shall not be present at any meeting of the board of directors the
directors present thereat may adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum shall be present.
Section 9. Unless otherwise restricted by the certificate of
incorporation or these bylaws, any action required or permitted
4
<PAGE>
to be taken at any meeting of the board of directors or of any committee,
thereof may be taken without a meeting, if all members of the board or
committee, as the case may be, consent thereto in writing, and the writing or
writings are filed with the minutes of proceedings of the board or committee.
Section 10. Unless otherwise restricted by the certificate of
incorporation or these bylaws, members of the board of directors, or any
committee designated by the board of directors, may participate in a meeting of
the board of directors, or any committee, by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.
Section 11. The board of directors may, by resolution passed by a
majority of the whole board, designate one or more committees, each committee to
consist of one or more of the directors of the corporation. The board may
designate one or more directors as alternate members of any committee, who may
replace any absent or disqualified member at a meeting of the committee.
Section 12. Each committee shall keep regular minutes of its
meetings and report the same to the board of directors when required.
Section 13. Unless otherwise restricted by the certificate of
incorporation or these bylaws, the board of directors shall have the authority
to fix the compensation of directors. The directors may be paid their expenses,
if any, of attendance at each meeting of the board of directors and may be paid
a fixed sum for attendance at each meeting of the board of directors or a stated
salary as director. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor. Members
of special or standing committees may be allowed like compensation for attending
committee meetings.
Section 14. Unless otherwise restricted by the certificate of
incorporation or by law, any director or the entire board of directors may be
removed, with or without cause, by the holders of a majority of shares entitled
to vote at an election of directors.
ARTICLE IV
NOTICE
Section 1. Whenever, under the provisions of the statutes or of the
certificate of incorporation or of these by-laws, notice is required to be given
to any director or stockholder, it shall not be construed to mean personal
notice, but such notice may be given
5
<PAGE>
in writing, by mail, addressed to such director or stockholder, at his address
as it appears on the records of the corporation, with postage thereon prepaid,
and such notice shall be deemed to be given at the time when the same shall be
deposited in the United States mail. Notice to directors may also be given by
telegram.
Section 2. Whenever any notice is required to be given under the
provisions of the statutes or of the certificate of incorporation or of these
by-laws, a waiver thereof in writing, signed by the person or persons entitled
to said notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
ARTICLE V
OFFICERS
Section 1. The officers of the corporation shall be chosen by the
board of directors and shall be a president, a vice president, a secretary and a
treasurer. The board of directors may also elect a Chairman of the Board,
additional vice presidents, and one or more assistant secretaries and assistant
treasurers. Except that one individual may not hold both the offices of
president and secretary, any number of offices may be held by the same person,
unless the certificate of incorporation or these bylaws otherwise provide.
Section 2. The board of directors at its first meeting after each
annual meeting of stockholders shall choose a president, one or more vice
presidents, a secretary and a treasurer.
Section 3. The board of directors may appoint such other officers
and agents as it shall deem necessary who shall hold their offices for such
terms and shall exercise such powers and perform such duties as shall be
determined from time to time by the board.
Section 4. The salaries of all officers and agents of the
corporation shall be fixed by the board of directors.
Section 5. The officers of the corporation shall hold office until
their successors are chosen and qualify or until their earlier resignation or
removal. Any officer elected or appointed by the board of directors may be
removed at any time by the affirmative vote of a majority of the board of
directors. Any vacancy occurring in any office of the corporation shall be
filled by the board of directors at such time as the board deems appropriate.
THE PRESIDENT
Section 6. The president shall be the chief executive officer of the
corporation, shall preside at all meetings of the stockholders and the board of
directors, shall have general and
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active management of the business of the corporation and shall see that all
orders and resolutions of the board of directors are carried into effect. The
president's authority may include other and further powers that the board of
directors may, from time to time, delegate to him.
Section 7. He shall execute bonds, mortgages and other contracts
requiring a seal, under the seal of the corporation, except where required or
permitted by law to be otherwise signed and executed and except where the
signing and execution thereof shall be expressly delegated by the board of
directors to some other officer or agent of the corporation.
THE VICE-PRESIDENTS
Section 8. In the absence of the president or in the event of his
inability or refusal to act, the vice president (or in the event there be more
than one vice president, the vice presidents in the order designated by the
directors, or in the absence of any designation, then in the order of their
election) shall perform the duties of the president, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the
president. The vice presidents shall perform such other duties and have such
other powers as the board of directors may from time to time prescribe.
THE SECRETARY AND ASSISTANT SECRETARY
Section 9. The secretary shall attend all meetings of the board of
directors and all meetings of the stockholders and record all the proceedings of
the meetings of the corporation and of the board of directors in a book to be
kept for that purpose and shall perform like duties for the standing committees
when required. He shall give, or cause to be given, notice of all meetings of
the stockholders and special meetings of the board of directors, and shall
perform such other duties as may be prescribed by the president as the president
deems appropriate, and, under whose supervision the secretary shall be. He shall
have custody of the corporate seal of the corporation and he, or an assistant
secretary, shall have authority to affix the same to any instrument requiring it
and when so affixed, it may be attested by his signature or by the signature of
such assistant secretary. The board of directors may give general authority to
any other officer to affix the seal of the corporation and to attest the
affixing by his signature.
Section 10. The assistant secretary, or if there be more than one,
the assistant secretaries in the order determined by the board of directors (or
if there be no such determination, then in the order of their election) shall,
in the absence of the secretary or in the event of his inability or refusal to
act, perform the duties and exercise the powers of the secretary and shall
perform
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<PAGE>
such other duties and have such other powers as the board of directors may from
time to time prescribe.
THE TREASURER AND ASSISTANT TREASURERS
Section 11. The treasurer shall have the custody of the corporate funds
and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the board of directors.
Section 12. He shall disburse the funds of the corporation as may be
ordered by the president, taking proper vouchers for such disbursements, and
shall render to the president and the board of directors, at its regular
meetings, or when the board of directors so requires, an account of all his
transactions as treasurer and of the financial condition of the corporation. The
treasurer shall also perform such other duties as shall be prescribed by the
president, as the president deems appropriate, and, under whose supervision the
treasurer shall be.
Section 13. If required by the board of directors, he shall give the
corporation a bond (which shall be renewed every six years) in such sum and with
such surety or sureties as shall be satisfactory to the board of directors for
the faithful performance of the duties of his office and for the restoration to
the corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of whatever
kind in his possession or under his control belonging to the corporation.
Section 14. The assistant treasurer, or if there shall be more than
one, the assistant treasurers in the order determined by the board of directors
(or if there be no such determination, then in the order of their election)
shall, in the absence of the treasurer or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the treasurer and
shall perform such other duties and have such other powers as the board of
directors may from time to time prescribe.
Section 15. The board of directors shall have the authority to
require any officer of the Corporation to give bond for the faithful discharge
of duties in such form and in such amount and with such surety or sureties as
the board may deem advisable.
Section 16. The compensation of all officers and employees of the
Corporation in salary grades 16 and above shall be fixed by the board of
directors. The compensation of all other officers, agents and employees of the
Corporation shall be fixed by the President or his designee.
8
<PAGE>
ARTICLE VI
CERTIFICATES FOR SHARES
Section 1. The shares of the corporation shall be represented by a
certificate. Certificates shall be signed by, or in the name of the corporation
by, the president or a vice president, and by the treasurer or an assistant
treasurer, or the secretary or an assistant secretary of the corporation.
Section 2. Any of or all the signatures on a certificate may be
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the corporation with the same effect as if he were
such officer, transfer agent or registrar at the date of issue.
LOST CERTIFICATES
Section 3. The board of directors may direct a new certificate or
certificates to be issued in place of any certificate or certificates
theretofore issued by the corporation alleged to have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming
the certificate of stock to be lost, stolen or destroyed. When authorizing such
issue of a new certificate or certificates, the board of directors may, in its
discretion and as a condition precedent to the issuance thereof, require the
owner of such lost, stolen or destroyed certificate or certificates, or his
legal representative, to advertise the same in such manner as it shall require
and/or to give the corporation a bond in such sum as it may direct as indemnity
against any claim that may be made against the corporation with respect to the
certificate alleged to have been lost, stolen or destroyed.
TRANSFER OF STOCK
Section 4. Upon surrender to the corporation or the transfer agent
of the corporation of a certificate for shares duly endorsed or accompanied by
proper evidence of succession, assignation or authority to transfer, it shall be
the duty of the corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
FIXING RECORD DATE
Section 5. In order that the corporation may determine the
stockholders entitled to notice of or to vote at any meeting of stockholders or
any adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment
9
<PAGE>
of any rights, or entitled to exercise any rights in respect of any change,
conversion or exchange of stock or for the purpose of any other lawful action,
the board of directors may fix, in advance, a record date, which shall not be
more than sixty nor less than ten days before the date of such meeting, nor more
than sixty days prior to any other action. A determination of stockholders of
record entitled to notice of or to vote at a meeting of stockholders shall apply
to any adjournment of the meeting; provided, however, that the board of
directors may fix a new record date for the adjourned meeting.
REGISTERED STOCKHOLDERS
Section 6. The corporation shall be entitled to recognize the exclusive
right of a person registered on its books as the owner of shares to receive
dividends, and to vote as such owner, and to hold liable for calls and
assessments a person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or other claim to or interest in such
share or shares on the part of any other person, whether or not it shall have
express or other notice thereof, except as otherwise provided by the laws of
Delaware.
ARTICLE VII
GENERAL PROVISIONS
DIVIDENDS
Section 1. Dividends upon the capital stock of the corporation,
subject to the provisions of the certificate of incorporation, if any, may be
declared by the board of directors at any regular or special meeting, pursuant
to law. Dividends may be paid in cash, in property, or in shares of the capital
stock, subject to the provisions of the certificate of incorporation.
Section 2. Before payment of any dividend, there may be set aside
out of any funds of the corporation available for dividends such sum or sums as
the directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or for such other
purpose as the directors shall think conducive to the interest of the
corporation, and the directors may modify or abolish any such reserve in the
manner in which it was created.
CHECKS
Section 3. All checks or demands for money and notes of the
corporation shall be signed by such officer or officers or such other person or
persons as the board of directors may from time to time designate.
10
<PAGE>
FISCAL YEAR
Section 4. The fiscal year of the corporation shall be fixed by
resolution of the board of directors.
SEAL
Section 5. The corporate seal shall have inscribed thereon the name
of the corporation, the year of its organization and the words "Corporate Seal,
Delaware". The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
INDEMNIFICATION
Section 6. The corporation shall indemnify its officers, directors,
employees and agents to the extent permitted by the General Corporation Law of
Delaware.
ARTICLE VIII
AMENDMENTS
Section 1. These by-laws may be altered, amended or repealed or new
by-laws may be adopted by the stockholders or by the board of directors, when
such power is conferred upon the board of directors by the certificate of
incorporation at any regular meeting of the stockholders or of the board of
directors or at any special meeting of the stockholders or of the board of
directors if notice of such alteration, amendment, repeal or adoption of new
by-laws be contained in the notice of such special meeting. If the power to
adopt, amend or repeal by-laws is conferred upon the board of directors by the
certificate of incorporation it shall not divest or limit the power of the
stockholders to adopt, amend or repeal by-laws.
11
<PAGE>
Exhibit 3.9
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF EXISTENCE
To Whom These Presents Come, Greeting:
I, SUE ANNE GILROY, Secretary of State of Indiana, do hereby certify that
I am, by virtue of the laws of the State of Indiana, the custodian of the
corporate records and the proper official to execute this certificate.
I further certify that records of this office disclose that
NORTH AMERICAN DISTRIBUTION SYSTEMS INC
filed Articles of Incorporation on October 07, 1965, and is a corporation duly
organized and existing under and by virtue of the laws of the State of Indiana.
I further certify this corporation has filed its most recent annual report
required by Indiana law with the Secretary of State, or is not yet required to
file such annual reports, and that Articles of Dissolution have not been filed.
[SEAL] In Witness Whereof, I have hereunto set my
hand and affixed the seal of the State of
SEAL OF THE STATE OF INDIANA Indiana, at the City of Indianapolis, this
Sixteenth day of November, 1999.
1816
/s/ Sue Anne Gilroy
SUE ANNE GILROY, Secretary of State
[Illegible
Initials]
-----------
Deputy
<PAGE>
Corporate Certificate No. 1
(Jan. 1954)
10M-
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
John D. Bottorff, Secretary of State
CERTIFICATE OF INCORPORATION
OF
TRI-CITY MOVING & STORAGE, INC.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
I, John D. Bottorff, Secretary of State of the State of Indiana, hereby
certify that Articles of Incorporation of the above Corporation, in the form
prescribed by my office, prepared and signed in triplicate by all of the
incorporators, and acknowledged and verified by at least three of them before a
Notary Public, have been presented to me at my office accompanied by the fees
prescribed by law; that I have found such Articles conform to law; that I have
endorsed my approval upon the triplicate copies of such Articles; that all fees
have been paid as required by law; that one copy of such Articles has been filed
in my office; and that two copies of such Articles bearing the endorsement of my
approval and filing has been returned by me to the incorporators or their
representatives; all as prescribed by the provisions of the Indiana General
Corporation Act, as amended.
Wherefore, I hereby issue to such Corporation this Certificate of
Incorporation, and further certify that its corporate existence has begun.
In Witness Whereof, I have hereunto set my hand and
affixed the seal of the State of Indiana, at the City of
[STATE SEAL] Indianapolis, this 7th day of OCTOBER, 1965
________________________________________________________
John D. Bottorff, Secretary of State
By______________________________________________________
Deputy
<PAGE>
APPROVED
AND
FILED
OCT 7 1979
/s/ John D. Bottorff
SECRETARY OF STATE OF INDIANA
Corporate Form No. 1 (Mar. 1950)--Page One
ARTICLES OF INCORPORATION
Prescribed by the Secretary of State of Indiana
Use White Paper--Size 8x10 1/2 Inches
Filing Requirements--Present 3 Executed Copies
to Secretary of State
Recording Requirements--Record 1 of such 3
Executed Copies, as Approved and Returned by
Secretary of State, with Recorder of County
where Principal Office is Located.
ARTICLES OF INCORPORATION
OF
Tri-City Moving & Storage, Inc.
The undersigned incorporators, desiring to form a corporation (hereinafter
referred to as the "Corporation") pursuant to the provisions of The Indiana
General Corporation Act, as amended (hereinafter referred to as the "Act"),
execute the following Articles of Incorporation.
ARTICLE I
Name
The name of the Corporation is Tri-City Moving & Storage, Inc.
ARTICLE II
Purposes
The purposes for which the Corporation is formed are:
(a) To buy, sell, distribute, warehouse and transport all kinds of
goods, wares, merchandise and commodities, including all
kinds of tangible or intangible property.
(b) To transport for hire as a common or contract or private
carrier all kinds of goods, wares, merchandise and
commodities, including all kinds of tangible or intangible
property.
(c) To own, lease, maintain and operate warehouses and other
appropriate facilities for the storage or safe-keeping for
hire of all kinds of goods, wares, merchandise and
commodities, including all kinds of tangible or intangible
property.
<PAGE>
(d) To acquire in any lawful manner and to hold, use, lease,
exchange and dispose of any kind of property, real or personal
or mixed, including specifically but not limited to stocks,
bonds, securities or other evidence of indebtedness of this or
any other corporation or for any person or persons whomsoever.
(e) To borrow and/or loan money with or without security and to
execute guarantee agreements and to mortgage, pledge, or
otherwise secure with property of this corporation any
indebtedness incurred by this corporation.
(f) To do any act which facilitates the achievement of any of the
aforesaid purposes.
<PAGE>
Corporate Form No. 1 (Mar. 1950)--Page Two
ARTICLE III
Term of Existence
The period during which the Corporation shall continue is perpetual
ARTICLE IV
Principal Office and Resident Agent
The post-office address of the principal office of the Corporation is 445
N. Sheridan Ave., P. 0. Box 3093, South Bend, St. Joseph County, Indiana and the
name and post-office address of its Resident Agent in charge of such office is
Dan Webber, 4221 Woodvale Drive, South Bend, St. Joseph County, Indiana
ARTICLE V
Amount of Capital Stock
The total number of shares into which the authorized capital stock of the
Corporation is divided is one thousand (1,000) shares consisting of __________
shares with the par value of $__________ per share, and __________ shares
without par value.
Such shares without par value shall be issued by the corporation from time to
time for such an amount of consideration as may be determined from time to time
by the board of directors.
ARTICLE VI
Terms of Capital Stock
Such shares may be sold by the corporation for such an amount of consideration
as shall be fixed from time to time by the board of directors. Transfers of
shares may be made only upon the books of the corporation by the holder named in
the certificate thereof or his attorney duly authorized in writing, and upon
surrender of such certificate properly endorsed by such holder or by the
secretary when authorized by the board of directors with or without the
surrender of such certificate.
The corporation shall have the right to treat the holder of record of any share
as the holder in fact thereof and accordingly shall not be bound to recognize
any equitable or other claim to or interest in such share on the part of any
other person whether or not it shall have the express or other notice thereof.
<PAGE>
Corporate Form No. 1 (Mar. 1950)--Page Three
ARTICLE VII
Voting Rights of Capital Stock
Each share of stock shall be entitled to one vote.
ARTICLE VIII
Paid-in Capital
The amount of paid-in capital, with which the Corporation is beginning
business, is $ One Thousand ($1,000.00)
ARTICLE IX
Data Respecting Directors
Section 1. Number. The maximum number of directors shall be 15. The exact
number of directors may be specified from time to time by the bylaws at not less
than 3 nor more than 15; whenever the bylaws do not so specify, the exact number
will be 3.
Section 2. Qualifications. Directors need not be shareholders of the
Corporation. A majority of the Directors at any time shall be citizens of the
United States.
ARTICLE X
Further Data Respecting Directors
Section 1. Names and Post-Office Addresses. The names and post-office
addresses of the first Board of Directors of the Corporation are as follows:
Name Number and Street or Building City Zone State
---- ----------------------------- ---- ---- -----
James D. Edgett P. O. Box 988 Fort Wayne 1 Indiana
Paul Clarke P. O. Box 988 Fort Wayne 1 Indiana
K. W. Maxfield 5760 Cote de Liesse Rd. Mount Royal, Montreal, Quebec
Section 2. Citizenship. All of such Directors are citizens of the United
States.
<PAGE>
Corporate Form No. 1 (Mar. 1950)--Page Four
ARTICLE XI
Data Respecting Incorporators
Section 1. Names and Post-Office Addresses. The names and post-office
addresses of the incorporators of the Corporation are as follows:
Name Number and Street or Building City Zone State
---- ----------------------------- ---- ---- -----
James D. Edgett P. O. Box 988 Fort Wayne 1 Indiana
Paul Clarke P. O. Box 988 Fort Wayne 1 Indiana
K. W. Maxfield 5760 Cote de Liesse Rd. Mount Royal, Montreal, Quebec
Section 2. Age and Citizenship. All of such incorporators are of lawful
age; and all of such incorporators are citizens of the United States.
Section 3. Compliance with Provisions of Sections 15 and 16 of the Act.
The undersigned incorporators hereby certify that the person or persons
intending to form the Corporation first caused lists for subscriptions to the
shares of the capital stock of the Corporation to be opened at such time and
place as he or they determined; when such subscriptions had been obtained in an
amount not less than $1,000, such person or persons, or a majority of them,
called a meeting of such subscribers for the purpose of designating the
incorporators and of electing the first Board of Directors; the incorporators so
designated are those named in Section 1 of this Article; and the Directors so
elected are those named in Section 1 of Article X.
ARTICLE XII
Provisions for Regulation of Business and Conduct
of Affairs of Corporation
Both shareholders and directors shall have the power to make, alter, amend or
repeal the bylaws of the corporation. Meetings of the shareholders may be held
either within or without the state of Indiana if the bylaws so provide. The
books of the corporation, except the duplicate stock register or transfer book,
may be kept either within or without the state of Indiana at such place or
places as may be, from time to time, designated by the board of directors. The
corporation reserves the right to alter, amend, change or repeal any provision
contained in these articles of incorporation in the manner now or hereafter
prescribed by statute and all rights confined upon shareholders herein are
granted subject to this reservation.
<PAGE>
Corporate Form No. 1 (Mar. 1950)--Page Five
IN WITNESS WHEREOF, the undersigned, being all of the incorporators
designated in Article XI, execute these Articles of Incorporation and certify to
the truth of the facts herein stated, this 1st day of October, 1965.
/s/ James D. Edgett
----------------------------
(Written Signature)
James D. Edgett
----------------------------
(Printed Signature)
/s/ Paul Clarke
----------------------------
(Written Signature)
Paul Clarke
----------------------------
(Printed Signature)
/s/ K. W. Maxfield
----------------------------
(Written Signature)
K. W. Maxfield
----------------------------
(Printed Signature)
STATE OF INDIANA }
} SS:
COUNTY OF Allen }
I, the undersigned, a Notary Public duly commissioned to take
acknowledgments and administer oaths in the State of Indiana, certify that James
D. Edgett, Paul Clarke and K. W. Maxfield, being all of the incorporators
referred to in Article XI of the foregoing Articles of Incorporation, personally
appeared before me; acknowledged the execution thereof; and swore to the truth
of the facts therein stated.
WITNESS my hand and Notarial Seal this 6th day of October, 1965.
/s/ Evelyn D. Fox
----------------------------
(Written Signature)
Evelyn D. Fox
----------------------------
(Printed Signature)
Notary Public
My commission expires
EVELYN D. FOX
My commission expires Feb. 22, 1968
This instrument was prepared by Terry G. Fewell, Attorney at Law, P. 0. Box 988,
Fort Wayne, Indiana
<PAGE>
Form SSC-32
State Form 37020
JAN 14 1983
MICROFILMED
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF AMENDMENT
OF
TRI-CITY MOVING & STORAGE, INC.
I, EDWIN J. SIMCOX, Secretary of State of Indiana, hereby certify that
Articles of Amendment for the above Corporation have been filed in the form
prescribed by my office, prepared and signed in duplicate in accordance with
Chapter Four of the Indiana General Corporation Act (IC 23-1-4). The name is
amended to:
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
NOW, THEREFORE, upon due examination, I find that the Articles of
Amendment conform to law, and have endorsed my approval upon the duplicate
copies of such Articles; that all fees have been paid as required by law; that
one copy of such Articles has been filed in my office; and that the remaining
copy of such Articles bearing the endorsement of my approval and filing has been
returned by me to the Corporation.
In Witness Whereof, I have hereunto set my hand and affixed
the seal of the State of Indiana, at the City of Indianapolis,
[STATE SEAL] this 27th day of December, 1982
--------------------------------------------------------------
EDWIN J. SIMCOX, Secretary of State
By
------------------------------------------------------------
Deputy
<PAGE>
Corporate Form No. 102 (Jan. 1971)--Page One
ARTICLES OF AMENDMENT (Amending Individual
Articles Only)
APPROVED Prescribed by Larry A. Conrad, Secretary of State
AND of Indiana
FILED
DEC 27 1982 Use Size 8 1/2 x 11 White Paper for Inserts
/s/ Edwin J. Simcox
SECRETARY OF STATE Filing Requirements--Present 2 Executed Copies to
OF INDIANA Secretary of State, Room 155, State House
Indianapolis 46204
Recording Requirements--Not required. However, if
the name of the Corporation is changed by these
Articles, a certified Certificates of Amendment
must be filed with the County Recorder of every
County where the Corporation owns real property
in Indiana.
ARTICLES OF AMENDMENT
OF THE
ARTICLES OF INCORPORATION
OF
Tri-City Moving & Storage, Inc.
The undersigned officers of Tri-City Moving & Storage, Inc. (hereinafter
referred to as the "Corporation") existing pursuant to the provisions of the
Indiana General Corporation Act, as amended (hereinafter referred to as the
"Act"), desiring to give notice of corporate action effectuating amendment of
certain provisions of its Articles of Incorporation, certify the following
facts:
ARTICLE I
Text of the Amendment
The exact text of Article(s) I and II of the Articles of Incorporation of
the Corporation, as amended (hereinafter referred to as the "Amendments"), now
is as follows:
Article I
The name of the corporation is North American Distribution Systems, Inc.
Article II
See attached.
(IND. - 929 - 12/5/74)
<PAGE>
Article II
The purposes for which the Corporation is formed are:
(1) To establish and carry on activities in connection with the warehousing,
including cold and dry storage, transportation, and distribution of all
goods, wares, merchandise and commodities; to maintain, buy, lease, hire,
build or otherwise operate buildings, storage houses and conveniences for
the care, keeping and transportation of such goods, wares, merchandise and
commodities; to issue warehouse receipts and make advances and loans upon
the security thereof; and to otherwise acquire, sell, mortgage, pledge,
lease, own or manage real or personal property and engage in such
activities necessary and incident to the purposes set forth above.
(2) To buy, sell, hold, take and receive by way of absolute or security title,
and own and otherwise deal in merchandise, real and personal property of
any and every kind, nature and description.
(3) To borrow money and to issue, sell, pledge, mortgage or hypothecate any of
its real or personal properties to secure such loans.
(4) To do any and all other things necessary and incident to the foregoing, or
to do any and all things otherwise permissible under Title 23, Article I,
Chapter 2 of the Indiana Statutues.
<PAGE>
Corporate Form No. 102 (Jan. 1971)--Page Two
Prescribed by Larry A. Conrad, Secretary of State
of Indiana
ARTICLE II
Manner of Adoption and Vote
Section 1. Action by Directors (select appropriate paragraph).
(a) The Board of Directors of the Corporation, at a meeting thereof, duly
called, constituted and held on ________________________, 19__, at which a
quorum of such Board of Directors was present, duly adopted a resolution
proposing to the Shareholders of the Corporation entitled to vote in respect the
Amendments that the provisions and terms of Article ______ of its Articles of
Incorporation be amended so as to read as set forth in the Amendments; and
called a meeting of such shareholders, to be held ________________________,
19__, to adopt or reject the Amendments, unless the same were so approved prior
to such date by unanimous written consent.
(b) By written consent executed on October 4, 1982, signed by all of the
members of the Board of Directors of the Corporation, a resolution was adopted
proposing to the Shareholders of the Corporation entitled to vote in respect of
the Amendments, that the provisions and terms of Articles of its Articles of
Incorporation be amended so as to read as set forth in the Amendments, and a
meeting of such shareholders was called to be held October 25, 1982, to adopt or
reject the Amendments, unless the same were so approved prior to such date by
unanimous written consent.
Section 2. Action by Shareholders (select appropriate paragraph).
(a) The Shareholders of the Corporation entitled to vote in respect of the
Amendments, at a meeting thereof, duly called, constituted and held on
________________________, 19__, at which _______________________________________
________________________________________________________________________________
________________________________________________________________________________
were present in person or by proxy, adopted the Amendments.
The holders of the following classes of shares were entitiled to vote as a
class in respect of the Amendments:
(1)
(2)
(3)
(IND. - 929)
<PAGE>
Corporate Form No. 102 (Jan. 1971)--Page Three
Prescribed by Larry A. Conrad, Secretary of State
of Indiana
The number of shares entitled to vote in respect of the Amendments, the
number of shares voted in favor of the adoption of the Amendments, and the
number of shares voted against such adoption are as follows:
Total Shares Entitled to Vote as a Class
----- (as listed immediately above)
-----------------------------
(1) (2) (3)
Shares entitled to vote: _________ _________ _________ _________
Shares voted in favor: _________ _________ _________ _________
Shares voted against: _________ _________ _________ _________
(b) By written consent executed on October 25, 1982, signed by the
holders of 1,000 shares of the Corporation, being all of the shares of the
Corporation entitled to vote in respect of the Amendments, the Shareholders
adopted the Amendments.
Section 3. Compliance with Legal Requirements.
The manner of the adoption of the Amendments, and the vote by which they
were adopted, constitute full legal compliance with the provisions of the Act,
the Articles of Incorporation, and the By-Laws of the Corporation.
ARTICLE III
Statement of Changes Made With Respect to Any Increase
In The Number of Shares Heretofore Authorized
Aggregate Number of Shares
Previously Authorized ____________
Increase ____________
Aggregate Number of Shares
To Be Authorized After Effect of This Amendment ____________
(IND. - 929)
<PAGE>
Corporate Form No. 102 (Jan. 1971)--Page Four
Prescribed by Larry A. Conrad, Secretary of State
of Indiana
IN WITNESS WHEREOF, the undersigned officers execute these Articles of
Amendment of the Articles of Incorporation of the Corporation, and certify to
the truth of the facts herein stated, this 7th day of December, 1982.
/s/ Kenneth W. Maxfield /s/ Margaret S. Vegeler
- ----------------------------------- ----------------------------------------
(Written Signature) (Written Signature)
Kenneth W. Maxfield Margaret S. Vegeler
- ----------------------------------- ----------------------------------------
(Printed Signature) (Printed Signature)
President of Secretary of
Tri-City Moving & Storage, Inc. Tri-City Moving & Storage, Inc.
- ----------------------------------- ----------------------------------------
(Name of Corporation) (Name of Corporation)
STATE OF INDIANA }
} SS:
COUNTY OF Allen }
I, the undersigned, a Notary Public duly commissioned to take
acknowledgements and administer oaths in the State of Indiana, certify that
Kenneth W. Maxfield, the President, and Margaret S. Vegeler, the Secretary of
Tri-City Moving & Storage, Inc., the officers executing the foregoing Articles
of Amendment of the Articles of Incorporation, personally appeared before me,
acknowledged the execution thereof, and swore to the truth of the facts therein
stated.
Witness my hand and Notarial Seal this 7th day of December, 1982.
/s/ Carol J. Korte
-----------------------------------
(Written Signature)
Carol J. Korte
-----------------------------------
(Printed Signature)
My Commission Expires: Notary Public
July 15, 1986
- ------------------------------------
COUNTY OF RESIDENCE: Allen
This instrument was prepared by Mark J. Fritz , Attorney at Law,
------------------------------
(Name)
P.O. Box 988 Fort Wayne Indiana 46801
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
(IND. - 929)
<PAGE>
STATE OF INDIANA, ALLEN COUNTY, SS: FEB 11 1983 83-000728
MICROFILMED
ALLEN COUNTY Recorder's Office.
I, Virginia L. Young, Recorder in and for said County, do hereby certify
that the above is a true and complete copy of the record of a Assumed Name
Certificate for North American Distribution Systems, Inc. d/b/a NADS as the same
appears on the Records of this office in Fort Wayne, Allen County, Indiana.
Document No. 83-00727, of which record I am the lawful custodian.
- -----------------------------
1983 JAN 13 AM 10:08
ALLEN COUNTY RECORDER
/s/ Virginia L. Young
APPROVED WITNESS my hand and official seal, at Fort Wayne, Indiana,
[ILLEGIBLE] this 13th day of January A.D. 1983
JAN [ILLEGIBLE] 1983
[ILLEGIBLE] /s/ Virginia L. Young
----------------------------------------------------------
Recorder Allen County, Indiana.
<PAGE>
ASSUMED NAME CERTIFICATE 83-000727
Kenneth W. Maxfield and Margaret S. Vegeler
---------------------------------- -----------------------------------
(Pres. or Vice-Pres) (Secy or Asst. Secy)
being duly sworn depose and say that: North American Distribution Systems, Inc.,
------------------------------------------
(Name of Corporation)
a corporation organized under the laws of the State of Indiana will conduct and
transact business or have an office in the County of Allen State of Indiana,
under the name of NADS ; That the full and true name of this
-----------------
assumed name
corporation is North American Distribution Systems, Inc. and the address of its
principal office in the State of Indiana is P. 0. Box 988, Fort Wayne, Indiana
46801.
Witness our hands and seal this 7th day of December, 1982.
North American Distribution Systems, Inc.
-----------------------------------------
(Name of Corporation)
/s/ Kenneth W. Maxfield
-----------------------------------------
(Pres. of Corporation)
Kenneth W. Maxfield
/s/ Margaret S. Vegeler
-----------------------------------------
(Secy of Corporation)
Margaret S. Vegeler
1983 JAN 13 AM 10:07
ALLEN COUNTY RECORDER
/s/ Virginia L. Young
STATE OF Indiana )
) SS.
COUNTY OF Allen )
Subscribed and sworn to by Kenneth W. Maxfield and Margaret S. Vegeler
upon their oaths before me, a Notary Public in and for said County and State
this 7th day of December, 1982.
/s/ Carol J. Korte
---------------------------
Notary Public
7/15/86
---------------------------
Commission expires
County of Residence: Allen
This instrument was prepared
by: /s/ Mark J. Fritz
---------------------
Mark J. Fritz
I, Virginia L. Young, RECORDER OF ALLEN COUNTY, Allen County, Indiana, hereby
certify that the above and foregoing is a true, full and correct copy of a
certain Certificate of Use of Assumed Name filed by North American Distribution
Systems, Inc., an Indiana Corporation, as the same appears and remains in the
records of my office. Witness by hand and the seal of my office this 13th day of
January, 1983.
/s/ Virginia L. Young
---------------------------------
RECORDER OF ALLEN COUNTY, INDIANA
(Seal)
<PAGE>
Exhibit 3.10
BY-LAWS
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ARTICLE 1
IDENTIFICATION
SECTION 1 - NAME.
The name of the corporation shall be Tri-City Moving & Storage, Inc.
(hereinafter referred to as the "corporation").
SECTION 2 - SEAL.
The corporation shall have a corporate seal which shall be as follows: A
circular disc, on the outer margin of which shall appear the corporate name
and State of Incorporation, with the words "Corporate Seal" through the
center, so mounted that it may be used to impress these words in raised
letters upon paper. The seal shall be in charge of the secretary.
SECTION 3 - FISCAL YEAR.
The fiscal year of the corporation shall begin at the beginning of the first
day of January and end at the close of the last day of December next
succeeding.
ARTICLE II
CAPITAL STOCK
SECTION 1 - CONSIDERATION FOR SHARES.
The board of directors shall cause the corporation to issue the capital stock
of the corporation for such consideration as has been fixed by such board in
accordance with the provisions of the Articles of Incorporation.
SECTION 2 - PAYMENT OF SHARES.
Subject to the provisions of the Articles of Incorporation, the consideration
for the issuance of shares of the capital stock of the corporation may be
paid, in whole or in part, in money, in other property, tangible or
intangible, or in labor actually performed for, or services actually rendered
to, the corporation; provided, however, that the part of the surplus of a
corporation which is transferred to capital upon the issuance of shares as a
share dividend shall be deemed to be the consideration for the issuance of
such shares. When payment of the consideration for which a share was
authorized to be issued shall have been received by the corporation, or when
surplus shall have been transferred to capital upon the issuance of a share
dividend, such share shall be declared and taken to be fully paid and not
liable to any further call or assessment, and the holder thereof shall not be
liable for any further payments thereon. In the absence of actual
<PAGE>
BY-LAWS (Cont'd)
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
fraud in the transaction, the judgment of the board of directors as to the
value of such property, labor or services received as consideration, or the
value placed by the board of directors upon the corporate assets in the event
of a share dividend shall be conclusive. Promissory notes or future services
shall not be accepted in payment or part payment of any of the capital stock
of the corporation.
SECTION 3 -- CERTIFICATES FOR SHARES.
The corporation shall issue to each shareholder a certificate signed by the
president or a vice-president, and the secretary of the corporation,
certifying the number of shares owned by him in the corporation. Where such
certificate is also signed by a transfer agent or registrar, the signatures
of the president, vice-president or secretary may be facsimiles. The
certificate shall state the name of the registered holder, the number of
shares represented thereby, the par value of each share or a statement that
such shares have no par value, and whether such shares have been fully paid
up, the certificate shall be legibly stamped to indicate the per centum which
has been paid up, and as further payments are made thereon, the certificate
shall be stamped accordingly.
If the corporation issues more than one class, every certificate issued shall
state the kind and class of shares represented thereby, and the relative
rights, interests, preferences and restrictions of such class, or a summary
thereof.
SECTION 4 -- FORM OF CERTIFICATES.
The stock certificates to represent the shares of the capital stock of this
corporation shall be in such form, not inconsistent with the laws of the
State of Indiana, as may be adopted by the board of directors.
SECTION 5 - TRANSFER OF STOCK.
Title to a certificate and to shares represented thereby can be transferred
only upon the books of the corporation by the holder named in the certificate
therefore, or by his attorney duly constituted in writing, and upon surrender
of such certificate properly endorsed by such holder; or by the secretary
when so authorized by the board of directors with or without the surrender of
such certificate.
SECTION 6 -- CLOSING OF TRANSFER BOOKS.
The transfer books shall be closed for a period of ten days prior to the date
set for any meeting of shareholders, and during such period no new
certificate of stock shall be issued by this corporation and no change or
transfer shall be made upon the records thereof.
<PAGE>
BY-LAWS (Cont'd)
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ARTICLE III
MEETINGS OF STOCKHOLDERS
SECTION 1 -- PLACE OF MEETINGS.
All meetings of shareholders of the corporation shall be held at such place,
within or without the State of Indiana, as may be specified in the respective
notices or waivers of notice thereof, or proxies to represent shareholders
thereat.
SECTION 2 -- ANNUAL MEETING.
The annual meeting of the shareholders for the election of directors, and for
the transaction of such other business as may properly come before the
meeting, shall be held at ten o'clock in the forenoon of the first Monday in
June of each year, if such day is not a legal holiday, and if a holiday then
on the first following day that is not a legal holiday. If for any reason the
annual meeting of the shareholders shall not be held at the time and place
herein provided, the same may be held at any time thereafter, or the business
to be transacted at such annual meeting may be transacted at any special
meeting called for that purpose.
SECTION 3 -- SPECIAL MEETINGS.
Special meetings of the shareholders may be called by the president, by the
board of directors, or by shareholders holding not less than one-fourth of
all the shares of capital stock outstanding.
SECTION 4 -- NOTICE OF MEETINGS.
A written or printed notice, stating the place, day and hour of the meeting,
and in case of a special meeting the purpose or purposes for which the
meeting is called, shall be delivered or mailed by the secretary or by the
officers or persons calling the meeting, to each holder of the capital stock
of the corporation at the time entitled to vote, at such address as appears
upon the records of the corporation, at least ten days before the date of the
meeting. Notice of any such meeting may be waived in writing by any
shareholder if the waiver sets forth in reasonable detail the purpose or
purposes for which the meeting is called, and the time and place thereof.
Attendance at any meeting, in person or by proxy shall constitute a waiver of
notice of such meeting.
SECTION 5 -- VOTING AT MEETINGS.
Except as otherwise provided by law, or by the provisions of the Articles of
Incorporation, every holder of the capital stock of the corporation shall
have the right at all meetings of the shareholders of the corporation to one
vote for each share of stock standing in his name on the books of the
corporation .
<PAGE>
BY-LAWS (Cont'd)
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No share shall be voted at any meeting:
(1) Upon which an installment is due and unpaid; or
(2) Which shall have been transferred on the books of the corporation
within ten days next preceding the date of the meeting; or
(3) Which belongs to the corporation.
SECTION 6 - PROXIES.
A shareholder may vote, either in person or by proxy executed in writing, by
the shareholder, or a duly authorized attorney-in-fact. No proxy shall be
valid after eleven (11) months from the date of its execution, unless a
longer time is expressly provided therein.
SECTION 7 - QUORUM.
Unless otherwise provided by the Articles of Incorporation, at any meeting of
shareholders, a majority of the shares of the capital stock outstanding and
entitled to vote, represented in person or by proxy, shall constitute a
quorum.
SECTION 8 - ORGANIZATION.
The president, and in his absence, the vice-president, and in their absence,
any shareholder chosen by the shareholders present, shall call meetings of
the shareholders to order and shall act as chairman of such meetings, and the
secretary of the company shall act as secretary of all meetings of the
shareholders. In the absence of the secretary, the presiding officer may
appoint a shareholder to act as secretary of the meeting.
ARTICLE IV
BOARD OF DIRECTORS
SECTION 1 - BOARD OF DIRECTORS.
The board of directors shall consist of three members, who shall be elected
annually by a majority of the shares represented at the annual meeting of the
shareholders. Such directors shall hold office until the next annual meeting
of the shareholders and until their successors are elected and qualified. A
majority of the directors must be citizens of the United States.
<PAGE>
BY-LAWS (Cont'd)
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SECTION 2 -- DUTIES.
The corporate power of this corporation shall be vested in the board of
directors, who shall have the management and control of the business of the
corporation. They shall employ such agents and servants as they may deem
advisable, and fix the rate of compensation of all agents, employees and
officers.
SECTION 3 -- RESIGNATION.
A director may resign at any time by filing his written resignation with the
secretary.
SECTION 4 -- REMOVAL.
Any director may be removed for cause at any time at any regular meeting or
at such a special meeting of the shareholders of the corporation called for
such purpose, by the affirmative vote of the holders of a majority of the
shares outstanding.
SECTION 5 -- VACANCIES.
In case of any vacancy in the board of directors through death, resignation,
removal or other cause, the remaining directors by the affirmative vote of a
majority thereof may elect a successor to fill such vacancy until the next
annual meeting and until his successor is elected and qualified. If the vote
of the remaining members of the board shall result in a tie, the vacancy
shall be filled by shareholders at the annual meeting or a special meeting.
SECTION 6 -- ANNUAL MEETINGS.
The board of directors shall meet each year immediately after the annual
meeting of the shareholders, at the place where such meeting of the
shareholders has been held, for the purpose of organization, election of
officers, and consideration of any other business that may be brought before
the meeting. No notice shall be necessary for the holding of this annual
meeting. If such meeting is not held as above provided, the election of
officers may be had at any subsequent meeting of the board specifically
called in the manner provided in Article IV, Section 7 of these by-laws.
SECTION 7 -- OTHER MEETINGS.
Other meetings of the board of directors may be held upon the call of the
president, or of two or more members of the board of directors, at any place
within or without the State of Indiana, upon forty-eight hours' notice,
specifying the time, place and general purposes of the meeting, given to each
director, either personally, by mailing, or by telegram. At any meeting at
which all directors are present, notice of the time, place and purpose
thereof shall be deemed waived; and similar notice may likewise be waived by
absent directors, either by written instrument or by telegram.
<PAGE>
BY-LAWS (Cont'd)
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
SECTION 8 -- QUORUM.
At any meeting of the board of directors, the presence of a majority of the
members of the board then qualified and acting shall constitute a quorum for
the transaction of any business except the filling of vacancies in the board
of directors.
SECTION 9 -- ORGANIZATION.
The president and, in his absence, the vice-president, and in their absence,
any director chosen by the directors present, shall call meetings of the board
of directors to order, and shall act as chairman of such meetings. The
secretary of the company shall act as secretary of the board of directors,
but in the absence of the secretary, the presiding officer may appoint any
director to act as secretary of the meeting.
SECTION 10 -- ORDER OF BUSINESS.
The order of business at all meetings of the board of directors shall be as
follows:
(1) Roll call,
(2) Reading of the Minutes of the preceding meeting and action thereon,
(3) Reports of officers,
(4) Reports of committees,
(5) Unfinished business,
(6) Miscellaneous business,
(7) New business.
ARTICLE V
OFFICERS OF THE CORPORATION
SECTION 1 -- OFFICERS.
The officers of the corporation shall consist of a president, one or more
vice-presidents, a secretary and a treasurer. Any two or more offices may be
held by the same person, except that the duties of the president and
secretary shall not be performed by the same person. The board of directors
by resolution may create and define the duties of other offices in the
corporation, and may elect or appoint persons to fill such offices.
SECTION 2 -- VACANCIES.
Whenever any vacancies shall occur in any office by death, resignation,
increase in the number of offices of the corporation, or otherwise, the same
shall be filled by the board of directors, and the officer so elected shall
hold office until his successor is chosen and qualified.
<PAGE>
BY-LAWS (Cont'd)
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- ------------------------------------------------------------------------------
SECTION 3 -- PRESIDENT.
The president shall preside at all meetings of shareholders and directors,
discharge all the duties which devolve upon a presiding officer, and perform
such other duties as this code of by-laws provides, or the board of directors
may prescribe.
The president shall have full authority to execute proxies in behalf of the
corporation, to vote stock owned by it in any other corporation, and to
execute, with the secretary, powers of attorney appointing other
corporations, partnerships, or individuals the agent of the corporation, all
subject to the provisions of The Indiana General Corporation Act of 1929, as
amended, the Articles of Incorporation and this code of by-laws.
SECTION 4 -- VICE-PRESIDENT.
The vice-president shall perform all duties incumbent upon the president
during the absence or disability of the president, and perform such other
duties as this code of by-laws may require or the board of directors may
prescribe.
SECTION 5 -- SECRETARY.
The secretary shall have the custody and care of the corporate seal, records,
minutes and stock books of the corporation. He shall attend all meetings of
the shareholders and of the board of directors, and shall keep, or cause to
be kept in a book provided for the purpose, a true and complete record of the
proceedings of such meetings, and shall perform a like duty for all standing
committees appointed by the board of directors, when required. He shall
attend to the giving and serving of all notices of the corporation, shall
file and take charge of all papers and documents belonging to the corporation
and shall perform such other duties as this code of by-laws may require or
the board of directors may prescribe.
SECTION 6 -- TREASURER.
The treasurer shall keep correct and complete records of account, showing
accurately at all times, the financial condition of the corporation. He
shall be the legal custodian of all moneys, notes, securities and other
valuables which may from time to time come into the possession of the
corporation. He shall immediately deposit all funds of the corporation
coming into his hands in some reliable bank or other depository to be
designated by the board of directors, and shall keep such bank account in the
name of the corporation. He shall furnish at meetings of the board of
directors, or whenever requested, a statement of the financial condition of
the corporation, and shall perform such other duties as this code of by-laws
may require or the board of directors may prescribe. The treasurer may be
required to furnish bond in such amount as shall be determined by the board
of directors.
<PAGE>
BY-LAWS (Cont'd)
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- ------------------------------------------------------------------------------
SECTION 7 -- DELEGATION OF AUTHORITY.
In case of the absence of any officer of the corporation, or for any other
reason that the board of directors may deem sufficient, the board of
directors may delegate the powers or duties of such officer to any other
officer or to any director, for the time being, provided a majority of the
entire board of directors concurs therein.
SECTION 8 -- EXECUTION OF DOCUMENTS.
Unless otherwise provided by the board of directors, all contracts, leases,
commercial paper and other instruments in writing and legal documents, shall
be signed by the president and attested by the secretary. All bonds deeds and
mortgages shall be signed by the president and attested by the secretary. All
certificates of stock shall be signed by the president or vice-president and
the secretary or assistant secretary.
All checks, drafts, notes and orders for the payment of money shall be signed
by those officers or employees of the corporation as the directors may from
time to time designate.
SECTION 9 -- LOANS TO OFFICERS.
No loan of money or property or any advance on account of services to be
performed in the future shall be made to any officer or director of the
corporation.
ARTICLE VI
CORPORATE BOOKS
SECTION 1 -- PLACE OF KEEPING, IN GENERAL.
Except as otherwise provided by the laws of the State of Indiana, by the
Articles of Incorporation of the corporation or by these by-laws, the books
and records of the corporation may be kept at such place or places, within or
without the State of Indiana, as the board of directors may from time to time
by resolution determine.
SECTION 2 -- STOCK REGISTER OR TRANSFER BOOK.
The original or duplicate stock register or transfer book, or in case a stock
registrar or transfer agent shall be employed by the corporation either
within or without the State of Indiana, a complete and accurate shareholders
list, alphabetically arranged, giving the names and addresses of all
shareholders, the number and classes of shares held by each, shall be kept at
the principal office of the corporation in the State of Indiana.
<PAGE>
BY-LAWS (Cont'd)
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ARTICLE VII
AMENDMENTS
SECTION 1 -- AMENDMENTS.
By-Laws may be adopted, amended or repealed at any meeting of the board of
directors by the vote of a majority thereof, unless the Articles of
Incorporation provide for the adoption, amendment or repeal by the
shareholders, in which event, action thereon may be taken at any meeting of
the shareholders by the vote of a majority of the voting shares outstanding.
<PAGE>
Exhibit 3.11
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF INCORPORATION
OF
NORTH AMERICAN TRAVEL SERVICE, INC.
I, LARRY A. CONRAD, Secretary of State of the State of Indiana, hereby
certify that Articles of Incorporation of the above Corporation, in the form
prescribed by my office, prepared and signed in duplicate by the
incorporator(s), and acknowledged and verified by the same before a Notary
Public, have been presented to me at my office accompanied by the fees
prescribed by law; that I have found such Articles conform to law; that I have
endorsed my approval upon the duplicate copies of such Articles; that all fees
have been paid as required by law; that one copy of such Articles has been filed
in my office; and that the remaining copy of such Articles bearing the
endorsement of my approval and filing has been returned by me to the
incorporator(s) or his (their) representatives; all as prescribed by the
provisions of the INDIANA GENERAL CORPORATION ACT, as amended.
NOW, THEREFORE, I hereby issue to such Corporation this Certificate of
Incorporation, and further certify that its corporate existence has begun.
In Witness Whereof, I have hereunto set my hand and affixed
the seal of the State of Indiana, at the City of Indianapolis,
this 17th day of November, 1976
[STATE SEAL]
--------------------------------------------------------------
LARRY A. CONRAD, Secretary of State
By
------------------------------------------------------------
Deputy
<PAGE>
APPROVED
AND
FILED
NOV 17 1976
/s/ Larry A. Conrad
SECRETARY OF
STATE OF INDIANA
Corporate Form No. 101 (Jan. 1971)--Page One
ARTICLES OF INCORPORATION
Larry A. Conrad, Secretary of State of Indiana
Use White Paper--Size 8 1/2 x 11--For Inserts
Filing Requirements--Present 2 Executed Copies to Secretary of State, Room 155,
State House Indianapolis 46204
Recording Requirements--Recording of Articles of Incorporation is no longer
required by the Indiana General Corporation Act.
ARTICLES OF INCORPORATION
OF
NORTH AMERICAN TRAVEL SERVICE, INC.
- --------------------------------------------------------------------------------
The undersigned incorporator or incorporators, desiring to form a
corporation (hereinafter referred to as the "Corporation") pursuant to the
provisions of the Indiana General Corporation Act, as amended (hereinafter
referred to as the "Act,") execute the following Articles of Incorporation.
ARTICLE I
Name
The name of the Corporation is NORTH AMERICAN TRAVEL SERVICE, INC.
- --------------------------------------------------------------------------------
ARTICLE II
Purposes
The purposes for which the Corporation is formed are:
(a) To arrange for the travel and accommodation of persons, including, but
not limited to, the purchase, resale and/or reservation of tickets for
transportation by land, sea and air and the purchase, resale and/or
reservation of motel, hotel or other accommodations.
<PAGE>
-2-
(b) To acquire, in any lawful manner, and to hold, use, lease, exchange
and dispose of any kind of property real or personal or mixed, including
specifically but not limited to stocks, bonds, securities or other
evidence of indebtedness of this or any other corporation or of any person
or persons whomsoever;
(c) To borrow and/or loan money, with or without security and to execute
guarantee agreements, and to mortgage, pledge, or otherwise secure with
property of this corporation any indebtedness incurred by this
corporation.
(d) To do any act which facilitates the achievement of any of the
aforesaid purposes.
<PAGE>
Corporate Form No. 101--Page Two
Prescribed by Larry A. Conrad, Secretary of State (Jan. 1971)
ARTICLE III
Period of Existence
The period during which the Corporation shall continue is perpetual
ARTICLE IV
Resident Agent and Principal Office
Section 1. Resident Agent. The name and address of the Resident Agent in
charge of the Corporation's principal office is
Lawrence P. Kahn P.O. Box 988
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(Name) (Number and Street or Building)
Fort Wayne Indiana 46801
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(City) (State) (Zip Code)
Section 2. Principal Office. The post office address of the principal
office of the Corporation is
Lincoln Hwy. & Meyer Road, Fort Wayne, Indiana 46801
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(Number and Street or Building) (City) (State) (Zip Code)
ARTICLE V
Shares
Section 1. Number.
A. The total number of shares which the Corporation has authority to
issue is 1,000
B. The number of shares which the corporation designates as having par
value is -- with a par value of $ --
C. The number of shares which the corporation designates as without par
value is 1,000
Section 2. Terms.
Such shares may be sold by the Corporation for such an amount of
consideration as shall be fixed from time to time by the Board of
Directors. Transfers of shares may be made only upon the books of the
Corporation by the holder named in the Certificate therefore, or by his
attorney duly authorized in writing, and upon surrender of such
certificate properly endorsed by such holder; or by the Secretary when so
authorized by the Board of Directors, with or without the surrender of
such certificate.
The Corporation shall have the right to treat the holder
<PAGE>
-2-
of record of any share as the holder in fact thereof, and accordingly, shall not
be bound to recognize any equitable or other claims, to, or interest in, such
share on the part of any other person, whether or not it shall have the express
or other notice thereof.
<PAGE>
Corporate Form No. 101--Page Three
Prescribed by Larry A. Conrad, Secretary of State (Jan. 1971)
ARTICLE VI
Requirements Prior To Doing Business
The Corporation will not commence business until consideration of the
value of at least $1,000.00 (one thousand dollars) has been received for the
issuance of shares.
ARTICLE VII
Director(s)
Section 1. Number of Directors. The initial Board of Directors is composed
of 3 member(s). The number of directors may be from time to time fixed by the
By-Laws of the Corporation at any number. In the absence of a By-Law fixing the
number of directors, the number shall be 3.
Section 2. Names and Post Office Addresses of the Director(s). The name(s)
and post office address(es) of the initial Board of Director(s) of the
Corporation is (are):
Name Number and Street or Building City State Zip Code
---- ----------------------------- ---- ----- --------
Stephen Heiman P.O. Box 988 Fort Wayne Indiana 46801
Edward Sullivan P.O. Box 988 Fort Wayne Indiana 46801
Tunis Bond P.O. Box 988 Fort Wayne Indiana 46801
Section 3. Qualifications of Directors. (If Any)
None
<PAGE>
Corporate Form No. 101--Page Four
Prescribed by Larry A. Conrad, Secretary of State (Jan. 1971)
ARTICLE VIII
Incorporator(s)
The name(s) and post office address(es) of the incorporator(s) of the
Corporation is (are):
Name Number and Street or Building City State Zip Code
---- ----------------------------- ---- ----- --------
Stephen Heiman P.O. Box 988 Fort Wayne Indiana 46801
Edward Sullivan P.O. Box 988 Fort Wayne Indiana
Tunis Bond P.O. Box 988 Fort Wayne Indiana 46801
ARTICLE IX
Provisions for Regulation of Business
and Conduct of Affairs of Corporation
Both shareholders and directors shall have the power to make, alter, amend, or
repeal the By-Laws of the Corporation. Meetings of shareholders may be held
either within or without the State of Indiana if the By-Laws so provide. The
books of the Corporation, except the duplicate stock register or transfer book,
may be kept either within or without the State of Indiana, at such place or
places as may be from time to time designated by the Board of Directors.
The Corporation reserves the right to alter, amend, change, or repeal any
provision contained in these Articles of Incorporation, in the manner now or
hereafter prescribed by statute, and all rights confined upon shareholders
herein are granted subject to this reservation.
<PAGE>
Corporate Form No. 101--Page Five
Prescribed by Larry A. Conrad, Secretary of State (Jan. 1971)
IN WITNESS WHEREOF, the undersigned, being the incorporator(s) designated
in Article VIII, execute these Articles of Incorporation and certify to the
truth of the facts herein stated, this 20th day of September, 1976.
/s/ Stephen Heiman /s/ Edward Sullivan
- ------------------------------------ -----------------------------------------
(Written Signature) (Written Signature)
Stephen Heiman Edward Sullivan
- ------------------------------------ -----------------------------------------
(Printed Signature) (Printed Signature)
/s/ Tunis Bond
-----------------------------------------
(Written Signature)
Tunis Bond
-----------------------------------------
(Printed Signature)
STATE OF INDIANA }
} ss:
COUNTY OF Allen }
I, the undersigned, a Notary Public duly commissioned to take
acknowledgements and administer oaths in the State of Indiana, certify that
Stephen Heiman, Edward Sullivan and Tunis Bond, being all of the incorporator(s)
referred to in Article VIII of the foregoing Articles of Incorporation,
personally appeared before me; acknowledged the execution thereof; and swore to
the truth of the facts therein stated.
Witness my hand and Notarial Seal this 20th day of September, 1976
/s/ Janet M. Hasse
----------------------------------------
(Written Signature)
Janet M. Hasse
----------------------------------------
(Printed Signature)
My Commission Expires: Notary Public
2-10-79
- ---------------------------------
This instrument was prepared by Michael L. Harvey, Attorney at Law,
-----------------
(Name)
P.O. Box 988 Fort Wayne Indiana 46801
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
<PAGE>
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF AMENDMENT
OF
NORTH AMERICAN TRAVEL SERVICE, INC.
I, EDWIN J. SIMCOX, Secretary of the State of Indiana, hereby certify that
Articles of Amendment for the above Corporation have been filed in the form
prescribed by my office, prepared and signed in duplicate in accordance with "An
Act concerning domestic and foreign corporations for profit, providing penalties
for the violation hereof, and repealing all laws or parts of laws in conflict
herewith," approved March 16, 1929, and Acts supplemental thereto.
The Articles amended are as follows, to wit:
The exact text of Articles I and II are amended,
The name of the Corporation is TRANSPORTATION COLLECTIONS, INC
NOW, THEREFORE, upon due examination, I find that the Articles of
Amendment conform to law, and have endorsed my approval upon the duplicate
copies of such Articles; that all fees have been paid as required by law; that
one copy of such Articles has been filed in my office; and that the remaining
copy of such Articles bearing the endorsement of my approval and filing has been
returned by me to the Corporation.
In Witness Whereof, I have hereunto set my hand and affixed
the seal of the State of Indiana, at the City of Indianapolis,
this 14th day of December 1978.
[STATE SEAL]
/s/ Edwin J. Simcox
--------------------------------------------------------------
Secretary of State
By /s/ Susan K. F?????
-----------------------------------------------------------
(Written Signature)
Deputy
<PAGE>
[ILLEGIBLE]
APPROVED
AND
FILED
DEC 14 1978
/s/ Edwin J. Simcox
SECRETARY OF STATE OF INDIANA
[ILLEGIBLE] dividual Articles Only)
Prescribed by Larry A. Conrad, Secretary of State of Indiana
Use Size 8 1/2 x 11 White Paper for Inserts
Filing Requirements--Present 2 Executed Copies to Secretary of State, Room 155,
State House Indianapolis 46204
Recording Requirements--Not required. However, if the name of the Corporation is
changed by these Articles, a certified Certificate of Amendment must be filed
with the County Recorder of every County where the Corporation owns real
property in Indiana.
ARTICLES OF AMENDMENT
OF THE
ARTICLES OF INCORPORATION
OF
NORTH AMERICAN TRAVEL SERVICE, INC.
The undersigned officers of NORTH AMERICAN TRAVEL SERVICE, INC.
(hereinafter referred to as the "Corporation") existing pursuant to the
provisions of the Indiana General Corporation Act (Medical Professional
Corporation Act/Dental Professional Corporation Act/Professional Corporation Act
of 1965), as amended (hereinafter referred to as the "Act"), desiring to give
notice of corporate action effectuating amendment of certain provisions of its
Articles of Incorporation, certify the following facts:
ARTICLE I
Text of the Amendment
The exact text of Article(s) I and II of the Articles of Incorporation of
the Corporation, as amended (hereinafter referred to as the "Amendments"), now
is as follows:
Article I: The name of the Corporation is TRANSPORTATION COLLECTIONS, INC.
Article II: The purposes for which the Corporation is formed are:
(a) to operate a collection agency for the purpose of collecting accounts owed
to individuals and businesses associated with the transportation industry as
well as other individuals and businesses seeking its services. Said collection
work shall be performed in the State of Indiana as well as the other 49 states.
Said collection work shall be performed in compliance with all applicable state
and federal laws, licensing procedures and regulations.
<PAGE>
(b) to acquire, in any lawful manner, and to hold, use, lease, exchange and
dispose of any kind of property real or personal or mixed, including
specifically but not limited to stocks, bonds, securities or other evidence of
indebtedness of this or any other corporation or of any person or persons,
whomsoever;
(c) to borrow and/or loan money, with or without security and to execute
guarantee agreements, and to mortgage, pledge, or otherwise secure with property
of this corporation any indebtedness incurred by this corporation.
(d) to do any act which facilitates the achievement of any of the aforesaid
purposes.
<PAGE>
Prescribed by Larry A. Conrad, Secretary of State of Indiana
ARTICLE II
Manner of Adoption and Vote
Section I. Action by Directors (select appropriate paragraph).
(a) The Board of Directors of the Corporation, at a meeting thereof, duly
called, constituted and held on ___________________________, 19____, at which a
quorum of such Board of Directors was present, duly adopted a resolution
proposing to the Shareholders of the Corporation entitled to vote in respect of
the Amendments that the provisions and terms of Article ______ of its Articles
of Incorporation be amended so as to read as set forth in the Amendments; and
called a meeting of such shareholders, to be held __________________, 19____, to
adopt or reject the Amendments, unless the same were so approved prior to such
date by unanimous written consent.
(b) By written consent executed on December 1, 1978, signed by all of the
members of the Board of Directors of the Corporation, a resolution was adopted
proposing to the Shareholders of the Corporation entitled to vote in respect of
the Amendments, that the provisions and terms of Articles of its Articles of
Incorporation be amended so as to read as set forth in the Amendments, and a
meeting of such shareholders was called to be held December 4, 1978, to adopt or
reject the Amendments, unless the same were so approved prior to such date by
unanimous written consent.
Section 2. Action by Shareholders (select appropriate paragraph).
(a) The Shareholders of the Corporation entitled to vote in respect of the
Amendments, at a meeting thereof, duly called, constituted and held on
____________________, 19____, at which _________________________________________
________________________________________________________________________________
________________________________________________________________________________
present in person or by proxy, adopted the Amendments.
The holders of the following classes of shares were entitled to vote as a
class in respect of the Amendments:
(1)
(2)
(3)
<PAGE>
Prescribed by Larry A. Conrad, Secretary of State of Indiana
The number of shares entitled to vote in respect of the Amendments, the
number of shares voted in favor of the adoption of the Amendments, and the
number of shares voted against such adoption are as follows:
Total Shares Entitled to Vote as a Class
----- (as listed immediately above)
-----------------------------
(1) (2) (3)
Shares entitled to vote: _________ _________ _________ _________
Shares voted in favor: _________ _________ _________ _________
Shares voted against: _________ _________ _________ _________
(b) By written consent executed on December 4, 1978, signed by the holders
of 1,000 shares of the Corporation, being all of the shares of the Corporation
entitled to vote in respect of the Amendments, the Shareholders adopted the
Amendments.
Section 3. Compliance with Legal Requirements.
The manner of the adoption of the Amendments, and the vote by which they
were adopted, constitute full legal compliance with the provisions of the Act,
the Articles of Incorporation, and the By-Laws of the Corporation.
ARTICLE III
Statement of Changes Made With Respect to Any Increase
In The Number of Shares Heretofore Authorized
Aggregate Number of Shares 1000
Previously Authorized ------------
Increase N/A {indicate "0" or "N/A"
------------ if no increase}
Aggregate Number of Shares
To Be Authorized After Effect of This Amendment 1000
------------
<PAGE>
Prescribed by Larry A. Conrad, Secretary of State of Indiana
IN WITNESS WHEREOF, the undersigned officers execute these Articles of
Amendment of the Articles of Incorporation of the Corporation, and certify to
the truth of the facts herein stated, this 13 day of Dec., 1978.
/s/ B. Wade Monroe /s/ Margaret S. Vegeler
- ------------------------------------ ----------------------------------------
(Written Signature) (Written Signature)
B. Wade Monroe Margaret S. Vegeler
- ------------------------------------ ----------------------------------------
(Printed Signature) (Printed Signature)
President of Secretary of
North American Travel Service, Inc. North American Travel Service, Inc.
- ------------------------------------ ----------------------------------------
(Name of Corporation) (Name of Corporation)
STATE OF INDIANA }
} SS:
COUNTY OF Allen }
I, the undersigned, a Notary Public duly commissioned to take
acknowledgements and administer oaths in the State of Indiana, certify that B.
Wade Monroe, the President, and Margaret S. Vegeler, the Secretary of North
American Travel Service, Inc., the officers executing the foregoing Articles of
Amendment of the Articles of Incorporation, personally appeared before me,
acknowledged the execution thereof, and swore to the truth of the facts therein
stated.
Witness my hand and Notarial Seal this 13th day of December, 1978.
/s/ Jane E. Simpson
-----------------------------------------
(Written Signature)
Jane E. Simpson
-----------------------------------------
(Printed Signature)
My Commission Expires: Notary Public
October 10, 1982
- ---------------------------------
This instrument was prepared by Margaret S. Vegeler, Attorney at Law,
-------------------
(Name)
5001 U.S. Highway 30 W. Fort Wayne Indiana 46818
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
<PAGE>
ARTICLES OF AMENDMENT OF THE ARTICLES OF INCORPORATION
[STATE State Form 38333R / Corporate Form No. 102 (June 1964)
SEAL] Articles of Amendment (Amending Individual Articles Only)
Prescribe by Edwin J. Simcox, Secretary of State of Indiana
Recording Requirements-Recording of Articles of Amendment in the Office of the
County Recorder is generally no longer required by the a [Illegible Text]
General Corporation Act. However, if the name of the corporation is changed
by this amendment, a certified copy of the certificate of Amendment must be
filed with the recorder of every county in which the corporation owns real
estate.
APPROVED
AND
FILED
IND. SECRETARY OF STATE
Instructions: Present 2 Originally Signed and Fully Executed Copies to:
SECRETARY OF STATE
Room 155, State House
Indianapolis, Indiana 46204
(317) 232-6576
[ILLEGIBLE DATE TIME STAMP]
ARTICLES OF AMENDMENT
OF THE
ARTICLES OF INCORPORATION
OF
Transportation Collections, Inc.
================================================================================
The undersigned officers of
Transportation Collections, Inc.
- --------------------------------------------------------------------------------
(hereinafter referred to as the "Corporation") existing pursuant to the
provisions of:
(Indicate appropriate act)
|X| Indiana General Corporation Act
|_| Indiana Professional Corporation Act of 1983
as amended (hereinafter referred to as the "Act"), desiring to give notice of
corporate action effectuating amendment of certain provisions of Articles of
Incorporation, certify the following facts:
- --------------------------------------------------------------------------------
ARTICLE I Amendment(s)
- --------------------------------------------------------------------------------
SECTION 1 The date of incorporation of the corporation is:
November 17, 1986
- --------------------------------------------------------------------------------
SECTION 2 The name of the corporation following this amendment to the Articles
of Incorporation is:
North American Logistics, Ltd.
- --------------------------------------------------------------------------------
SECTION 3
The exact text of Article(s) I and II of the Articles of Incorporation are now
as follows:
ARTICLE I: The name of the corporation is North American Logistics, Ltd.
ARTICLE II:
(a) To operate a collection agency for the purpose of collecting
accounts owed to individuals and businesses associated with the
transportation industry as well as other individuals and businesses
seeking its services. Said collection work shall be performed in the
State of Indiana as well as the other 49 states. Said collection
work shall be performed in compliance with all applicable state and
federal laws, licensing procedures and regulations.
(b) To acquire, in any lawful manner, and to hold, use, lease, exchange
and dispose of any kind of property real or personal or mixed,
including specifically but not limited to stocks, bonds, securities
or other evidence of indebtedness of this or any other corporation
or of any person or persons, whomsoever.
(c) To borrow and/or loan money, with or without security and to execute
guarantee agreements, and to mortgage, pledge, or otherwise secure
with property of this corporation any indebtedness incurred by this
corporation.
(d) To do any act which facilitates the achievement of any of the
aforesaid purposes.
(e) To transact any and all lawful business for which corporations may
be incorporated under the Indiana General Corporation Act.
- --------------------------------------------------------------------------------
<PAGE>
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
ARTICLES OF AMENDMENT
To Whom These Presents Come, Greeting:
WHEREAS, there has been presented to me at this office, Articles of Amendment
for:
TRANSPORTATION COLLECTIONS INC
and said Articles of Amendment have been prepared and signed in accordance with
the provisions of the
Indiana Business Corporation Law,
as amended.
The name of the corporation is amended as follows:
NORTH AMERICAN LOGISTICS, LTD.
NOW, THEREFORE, I, JOSEPH H. HOGSETT, Secretary of State of Indiana, hereby
certify that I have this day filed said articles in this office.
The effective date of these Articles of Amendment is May 21, 1992.
In Witness Whereof, I have hereunto set my
hand and affixed the seal of the State of
Indiana, at the City of Indianapolis, this
Twenty-first day of May, 1992
/s/ Joseph H. Hogsett
------------------------------------------
JOSEPH H. HOGSETT, Secretary of State
By /s/ Michael W. [ILLEGIBLE]
---------------------------------------
Deputy
<PAGE>
Exhibit 3.12
BY-LAWS
OF
NORTH AMERICAN TRAVEL SERVICE, INC.
ARTICLE I -- OFFICES
The principal office of the corporation in the State of shall be
located in the City of New Haven, County of Allen. The corporation may have such
other offices, either within or without the State of incorporation as the board
of directors may designate or as the business of the corporation may from time
to time require.
ARTICLE II -- STOCKHOLDERS
1. ANNUAL MEETING.
The annual meeting of the stockholders shall be held on the 1st day of
December in each year, beginning with the year 1977 at the hour 10 o'clock A.M.,
for the purpose of electing directors and for the transaction of such other
business as may come before the meeting. If the day fixed for the annual meeting
shall be a legal holiday such meeting shall be held on the next succeeding
business day.
2. SPECIAL MEETINGS.
Special meetings of the stockholders, for any purpose or purposes, unless
otherwise prescribed by statute, may be called by the president or by the
directors, and shall be called by the president at the request of the holders of
not less than 50 per cent of all the outstanding shares of the corporation
entitled to vote at the meeting.
3. PLACE OF MEETING.
The directors may designate any place, either within or without the State
unless otherwise prescribed by statute, as the place of meeting for any annual
meeting or for any special meeting called by the directors. A waiver of notice
signed by all stockholders entitled to vote at a meeting may designate
By-Laws 1
<PAGE>
any place, either within or without the state unless otherwise prescribed by
statute, as the place for holding such meeting. If no designation is made, or if
a special meeting be otherwise called, the place of meeting shall be the
principal office of the corporation.
4. NOTICE OF MEETING.
Written or printed notice stating the place, day and hour of the meeting
and, in case of a special meeting, the purpose or purposes for which the meeting
is called, shall be delivered not less than 10 nor more than 30 days before the
date of the meeting, either personally or by mail, by or at the direction of the
president, or the secretary, or the officer or persons calling the meeting, to
each stockholder of record entitled to vote at such meeting. If mailed, such
notice shall be deemed to be delivered when deposited in the United States mail,
addressed to the stockholder at his address as it appears on the stock transfer
books of the corporation, with postage thereon prepaid.
5. CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE.
For the purpose of determining stockholders entitled to notice of or to
vote at any meeting of stockholders or any adjournment thereof, or stockholders
entitled to receive payment of any dividend, or in order to make a determination
of stockholders for any other proper purpose, the directors of the corporation
may provide that the stock transfer books shall be closed for a stated period
but not to exceed, in any case, 30 days. If the stock transfer books shall be
closed for the purpose of determining stockholders entitled to notice of or to
vote at a meeting of stockholders, such books shall be closed for at least 10
days immediately preceding such meeting. In lieu of closing the stock transfer
books, the directors may fix in advance a date as the record date for any such
determination of stockholders, such date in any case to be not more than 30 days
and, in case of a meeting of stockholders, not less than 30 days prior to the
date on which the particular action requiring such determination of stockholders
is to be taken. If the stock transfer books are not closed and no record date is
fixed for the determination of stockholders entitled to notice of or to vote at
a meeting of stockholders, or stockholders entitled to receive payment of a
dividend, the date on which notice of the meeting is mailed or the date on which
the resolution of the directors declaring such dividend is adopted, as the case
may be, shall be the record date for such determination of stockholders. When a
determination of stockholders entitled to vote at any meeting of stockholders
By-Laws 2
<PAGE>
has been made as provided in this section, such determination shall apply to any
adjournment thereof.
6. VOTING LISTS.
The officer or agent having charge of the stock transfer books for shares
of the corporation shall make, at least 10 days before each meeting of
stockholders, a complete list of the stockholders entitled to vote at such
meeting, or any adjournment thereof, arranged in alphabetical order, with the
address of and the number of shares held by each, which list, for a period of 10
days prior to such meeting, shall be kept on file at the principal office of the
corporation and shall be subject to inspection by any stockholder at any time
during usual business hours. Such list shall also be produced and kept open at
the time and place of the meeting and shall be subject to the inspection of any
stockholder during the whole time of the meeting. The original stock transfer
book shall be prima facie evidence as to who are the stockholders entitled to
examine such list or transfer books or to vote at the meeting of stockholders.
7. QUORUM.
At any meeting of stockholders 50 percent of the outstanding shares of the
corporation entitled to vote, represented in person or by proxy, shall
constitute a quorum at a meeting of stockholders. If less than said number of
the outstanding shares are represented at a meeting, a majority of the shares so
represented may adjourn the meeting from time to time without further notice. At
such adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally notified. The stockholders present at a duly organized meeting may
continue to transact business until adjournment, notwithstanding the withdrawal
of enough stockholders to leave less than a quorum.
8. PROXIES.
At all meetings of stockholders, a stockholder may vote by proxy executed
in writing by the stockholder or by his duly authorized attorney in fact. Such
proxy shall be filed with the secretary of the corporation before or at the time
of the meeting.
9. VOTING.
Each stockholder entitled to vote in accordance with the terms and
provisions of the certificate of incorporation and these by-laws shall be
entitled to one vote, in person or by
By-Laws 3
<PAGE>
proxy, for each share of stock entitled to vote held by such stockholders. Upon
the demand of any stockholder, the vote for directors and upon any question
before the meeting shall be by ballot. All elections for directors shall be
decided by plurality vote; all other questions shall be decided by majority vote
except as otherwise provided by the Certificate of Incorporation or the laws of
this State.
10. ORDER OF BUSINESS.
The order of business at all meetings of the stockholders, shall be as
follows:
1. Roll Call.
2. Proof of notice of meeting or waiver of notice.
3. Reading of minutes of preceding meeting.
4. Reports of Officers.
5. Reports of Committees.
6. Election of Directors.
7. Unfinished Business.
8. New Business.
11. INFORMAL ACTION BY STOCKHOLDERS.
Unless otherwise provided by law, any action required to be taken at a
meeting of the shareholders, or any other action which may be taken at a meeting
of the shareholders, may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall be signed by all of the shareholders
entitled to vote with respect to the subject matter thereof.
By-Laws 4
<PAGE>
ARTICLE III -- BOARD OF DIRECTORS
1. GENERAL POWERS.
The business and affairs of the corporation shall be managed by its board
of directors. The directors shall in all cases act as a board, and they may
adopt such rules and regulations for the conduct of their meetings and the
management of the corporation, as they may deem proper, not inconsistent with
these by-laws and the laws of this State.
2. NUMBER, TENURE AND QUALIFICATIONS.
The number of directors of the corporation shall be three. Each director
shall hold office until the next annual meeting of stockholders and until his
successor shall have been elected and qualified.
3. REGULAR MEETINGS.
A regular meeting of the directors, shall be held without other notice
than this by-law immediately after, and at the same place as, the annual meeting
of stockholders. The directors may provide, by resolution, the time and place
for the holding of additional regular meetings without other notice than such
resolution.
4. SPECIAL MEETINGS.
Special meetings of the directors may be called by or at the request of
the president or any two directors. The person or persons authorized to call
special meetings of the directors may fix the place for holding any special
meeting of the directors called by them.
5. NOTICE.
Notice of any special meeting shall be given at least ten days previously
thereto by written notice delivered personally, or by telegram or mailed to each
director at his business address. If mailed, such notice shall be deemed to be
delivered when deposited in the United States mail so addressed, with postage
thereon prepaid. If notice be given by telegram, such notice shall be deemed to
be delivered when the telegram is delivered to the telegraph company. The
attendance of a director at a meeting shall constitute a waiver of notice of
such meeting, except where a director attends a meeting for the express purpose
of objecting to the transaction of any business because the meeting is not
lawfully called or convened.
By-Laws 5
<PAGE>
6. QUORUM.
At any meeting of the directors, two shall constitute a quorum for the
transaction of business, but if less than said number is present at a meeting, a
majority of the directors present may adjourn the meeting from time to time
without further notice.
7. MANNER OF ACTING.
The act of the majority of the directors present at a meeting at which a
quorum is present shall be the act of the directors.
8. NEWLY CREATED DIRECTORSHIPS AND VACANCIES.
Newly created directorships resulting from an increase in the number of
directors and vacancies occurring in the board for any reason except the removal
of directors without cause may be filled by a vote of a majority of the
directors then in office, although less than a quorum exists. Vacancies
occurring by reason of the removal of directors without cause shall be filled by
vote of the stockholders. A director elected to fill a vacancy caused by
resignation, death or removal shall be elected to hold office for the unexpired
term of his predecessor.
9. REMOVAL OF DIRECTORS.
Any or all of the directors may be removed for cause by vote of the
stockholders or by action of the board. Directors may be removed without cause
only by vote of the stockholders.
10. RESIGNATION.
A director may resign at any time by giving written notice to the board,
the president or the secretary of the corporation. Unless otherwise specified in
the notice, the resignation shall take effect upon receipt thereof by the board
or such officer, and the acceptance of the resignation shall not be necessary to
make it effective.
11. COMPENSATION.
No compensation shall be paid to directors, as such, for their services,
but by resolution of the board a fixed sum and expenses for actual attendance at
each regular or special meeting of the board may be authorized. Nothing herein
contained shall be construed to preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.
By-Laws 6
<PAGE>
12. PRESUMPTION OF ASSENT.
A director of the corporation who is present at a meeting of the directors
at which action on any corporate matter is taken shall be presumed to have
assented to the action taken unless his dissent shall be entered in the minutes
of the meeting or unless he shall file his written dissent to such action with
the person acting as the secretary of the meeting before the adjournment thereof
or shall forward such dissent by registered mail to the secretary of the
corporation immediately after the adjournment of the meeting. Such right to
dissent shall not apply to a director who voted in favor of such action.
13. EXECUTIVE AND OTHER COMMITTEES.
The board, by resolution, may designate from among its members an
executive committee and other committees, each consisting of three or more
directors. Each such committee shall serve at the pleasure of the board.
14. INFORMAL ACTION BY DIRECTORS.
Unless otherwise provided by law, any action required to be taken at a
meeting of the directors, or any other action which may be taken at a meeting of
the directors, may be taken without a meeting if a consent in writing, setting
forth the action so taken, shall be signed by all the directors entitled to vote
with respect to the subject matter thereof.
By-Laws 7
<PAGE>
ARTICLE IV -- OFFICERS
1. NUMBER.
The officers of the corporation shall be a president, a vice-president, a
secretary and a treasurer, each of whom shall be elected by the directors. Such
other officers and assistant officers as may be deemed necessary may be elected
or appointed by the directors.
2. ELECTION AND TERM OF OFFICE.
The officers of the corporation to be elected by the directors shall be
elected annually at the first meeting of the directors held after each annual
meeting of the stockholders. Each officer shall hold office until his successor
shall have been duly elected and shall have qualified or until his death or
until he shall resign or shall have been removed in the manner hereinafter
provided.
3. REMOVAL.
Any officer or agent elected or appointed by the directors may be removed
by the directors whenever in their judgment the best interests of the
corporation would be served thereby, but such removal shall be without prejudice
to the contract rights, if any, of the person so removed.
4. VACANCIES.
A vacancy in any office because of death, resignation, removal,
disqualification or otherwise, may be filled by the directors for the unexpired
portion of the term.
5. PRESIDENT.
The president shall be the principal executive officer of the corporation
and, subject to the control of the directors, shall in general supervise and
control all of the business and affairs of the corporation. He shall, when
present, preside at all meetings of the stockholders and of the directors. He
may sign, with the secretary or any other proper officer of the corporation
thereunto authorized by the directors, certificates for shares of the
corporation, any deeds, mortgages, bonds, contracts, or other instruments which
the directors have authorized to be executed, except in cases where the signing
and execution thereof shall be expressly delegated by the directors or by these
by-laws to some other officer or agent of the corporation, or shall be required
by law to be otherwise signed or executed; and in general shall
By-Laws 8
<PAGE>
perform all duties incident to the office of president and such other duties as
may be prescribed by the directors from time to time.
6. VICE-PRESIDENT.
In the absence of the president or in event of his death, inability or
refusal to act, the vice-president shall perform the duties of the president,
and when so acting, shall have all the powers of and be subject to all the
restrictions upon the president. The vice-president shall perform such other
duties as from time to time may be assigned to him by the President or by the
directors.
7. SECRETARY.
The secretary shall keep the minutes of the stockholders' and of the
directors' meetings in one or more books provided for that purpose, see that all
notices are duly given in accordance with the provisions of these by-laws or as
required, be custodian of the corporate records and of the seal of the
corporation and keep a register of the post office address of each stockholder
which shall be furnished to the secretary by such stockholder, have general
charge of the stock transfer books of the corporation and in general perform all
duties incident to the office of secretary and such other duties as from time to
time may be assigned to him by the president or by the directors.
8. TREASURER.
If required by the directors, the treasurer shall give a bond for the
faithful discharge of his duties in such sum and with such surety or sureties as
the directors shall determine. He shall have charge and custody of and be
responsible for all funds and securities of the corporation; receive and give
receipts for moneys due and payable to the corporation from any source
whatsoever, and deposit all such moneys in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with these by-laws and in general perform all of the duties incident to the
office of treasurer and such other duties as from time to time may be assigned
to him by the president or by the directors.
9. SALARIES.
The salaries of the officers shall be fixed from time to time by the
directors and no officer shall be prevented from receiving such salary by reason
of the fact that he is also a director of the corporation.
By-Laws 9
<PAGE>
10. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
(a) Each director and officer, elected or appointed, shall be entitled, without
the necessity of further act or deed on the part of himself or the corporation
to be indemnified by the corporation from and against any and all claims,
liabilities, fines or penalties, whether or not reduced to judgment, imposed
upon or asserted against him by reason of his being or having been a director or
officer of the corporation or otherwise, and also from and against all costs and
expenses (including, without any limitation of the foregoing, fees and
disbursements of counsel) reasonably incurred by him as a result thereof,
whether in settlement of the same or in connection with any action, suit or
proceeding to which he is now or may hereafter become or be made a party for a
like reason; provided, however, that such indemnification shall not extend to
any instance in which
(i) any liability, fine or penalty is imposed upon him by final judgment
of a court of competent jurisdiction or the claims against him are
dismissed or barred upon the ground of any statute of limitations or
of any other technical defense not going to the merits of the claims
involved, unless the court shall find that the liability, fine or
penalty so imposed or the claims so dismissed or barred resulted
from action taken or omitted to be taken by him in good faith and
without negligence or misconduct in the performance of his duty or,
in the absence of such a finding, unless counsel selected or
approved by the board of directors shall have advised the
corporation that in the opinion of such counsel such liability, fine
or penalty or such claims resulted from action taken or omitted to
be taken by him in good faith and without negligence or misconduct
in the performance of his duty; or
(ii) any amount is paid or is to be paid by him to the corporation in or
in connection with the settlement of any action, suit, proceeding or
claim, with or without the entry of any judgment therein or in
respect thereof by a court of competent jurisdiction; or
By-Laws 9(a)
<PAGE>
(iii) any amount is paid or is to be paid by him to any party other than
the corporation in or in connection with the settlement of any
action, suit, proceeding or claim, with or without the entry of any
judgment therein or in respect thereof by a court of competent
jurisdiction, unless such court shall find that such director or
officer acted in good faith and without negligency or misconduct in
the performance of his duty, or unless, in the absence of such
finding, the corporation shall be advised by counsel selected or
approved by the board that in the opinion of such counsel such
action, suit, proceeding or claim is without substantial merit or
that such director or officer acted in good faith and without
negligence or misconduct in the performance of his duty with respect
to the matters involved therein, but in no event shall the amount of
the indemnity under this subdivision (iii) exceed the expense which
might, in the judgment of the board, reasonably be incurred by such
director of officer in conducting his defense to a final conclusion;
nor shall such indemnification extend to any costs or expenses in connection
with any case referred to in clause (i), (ii) and (iii) above.
(b) The corporation's obligation aforesaid (i) shall exist whether or not a
director or officer is or has continued to be a director or officer of the
corporation at or up to the time any costs or expenses are incurred or any
claims or liabilities arise or any settlement is effected, (ii) shall inure to
the benefit of the heirs, executors or administrators of such director or
officer, (iii) shall not be exclusive as a matter of law, and (iv) may, but need
not, be evidenced by a writing to be delivered to him in connection with his
election or appointment as such director and/or officer and in consideration of
his acceptance of the same. Notwithstanding any repeal of this Section or other
amendment of these By-Laws affecting or purporting to affect this Section or the
indemnification herein provided, such obligation shall be binding upon the
corporation (subject only to the exceptions hereinbefore set forth) as to all
matters which occur during or are allocable to the period prior to any such
repeal or amendment and shall cover all
By-Laws 9(b)
<PAGE>
claims, liabilities, costs and expenses at any time connected therewith, and
also any settlement thereof, as hereinabove stated.
(c) In determining whether and to what extent, if any, a director or officer of
the corporation is entitled to indemnification hereunder or under any writing
aforesaid and in making any payments pursuant to such determination, the board
of directors and/or each director and officer, whether or not interested in any
such determination or payment, may rely upon, and shall be protected by, an
opinion of counsel selected or approved by the board, which counsel may, but
need not, be counsel advising as above mentioned. In the selection of counsel
for any one or more of the purposes hereinabove set forth, the determination of
the board shall be final and binding, notwithstanding that one or more, or all,
of the directors taking part in such selection are or were interested in any
payment or indemnification to which claim is made hereunder.
By-Laws 9(c)
<PAGE>
ARTICLE V -- CONTRACTS, LOANS, CHECKS AND DEPOSITS
1. CONTRACTS.
The directors may authorize any officer or officers, agent or agents, to
enter into any contract or execute and deliver any instrument in the name of and
on behalf of the corporation, and such authority may be general or confined to
specific instances.
2. LOANS.
No loans shall be contracted on behalf of the corporation and no evidences
of indebtedness shall be issued in its name unless authorized by a resolution of
the directors. Such authority may be general or confined to specific instances.
3. CHECKS, DRAFTS, ETC.
All checks, drafts or other orders for the payment of money, notes or
other evidences of indebtedness issued in the name of the corporation, shall be
signed by such officer or officers, agent or agents of the corporation and in
such manner as shall from time to time be determined by resolution of the
directors.
4. DEPOSITS.
All funds of the corporation not otherwise employed shall be deposited
from time to time to the credit of the corporation in such banks, trust
companies or other depositaries as the directors may select.
ARTICLE VI -- CERTIFICATES FOR SHARES AND THEIR TRANSFER
1. CERTIFICATES FOR SHARES.
Certificates representing shares of the corporation shall be in such form
as shall be determined by the directors. Such certificates shall be signed by
the president and by the secretary or by such other officers authorized by law
and by the directors. All certificates for shares shall be consecutively
numbered or otherwise identified. The name and address of the stockholders, the
number of shares and date of issue, shall be entered on the stock transfer books
of the corporation. All certificates surrendered to the corporation for transfer
shall be canceled and no new certificate shall be issued until the
By-Laws 10
<PAGE>
former certificate for a like number of shares shall have been surrendered and
canceled, except that in case of a lost, destroyed or mutilated certificate a
new one may be issued therefor upon such terms and indemnity to the corporation
as the directors may prescribe.
2. TRANSFERS OF SHARES.
(a) Upon surrender to the corporation or the transfer agent of the
corporation of a certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it shall be the
duty of the corporation to issue a new certificate to the person entitled
thereto, and cancel the old certificate; every such transfer shall be entered on
the transfer book of the corporation which shall be kept at its principal
office.
(b) The corporation shall be entitled to treat the holder of record of any
share as the holder in fact thereof, and, accordingly, shall not be bound to
recognize any equitable or other claim to or interest in such share on the part
of any other person whether or not it shall have express or other notice
thereof, except as expressly provided by the laws of this state.
ARTICLE VII -- FISCAL YEAR
The fiscal year of the corporation shall begin on the first day of January
in each year.
ARTICLE VIII -- DIVIDENDS
The directors may from time to time declare, and the corporation may pay,
dividends on its outstanding shares in the manner and upon the terms and
conditions provided by law.
ARTICLE IX -- SEAL
The directors shall provide a corporate seal which shall be circular in
form and shall have inscribed thereon the name of the corporation, the state of
incorporation, year of incorporation and the words, "Corporate Seal".
By-Laws 11
<PAGE>
ARTICLE X -- WAIVER OF NOTICE
Unless otherwise provided by law, whenever any notice is required to be
given to any stockholder or director of the corporation under the provisions of
these by-laws or under the provisions of the articles of incorporation, a waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent to
the giving of such notice.
ARTICLE XI -- AMENDMENTS
These by-laws may be altered, amended or repealed and new by-laws may be
adopted by a vote of the stockholders representing a majority of all the shares
issued and outstanding, at any annual stockholders' meeting or at any special
stockholders' meeting when the proposed amendment has been set out in the notice
of such meeting.
These by-laws may also be altered, amended or repealed and new by-laws
may be adopted by a vote of the majority of the directors at either an annual
meeting, a special meeting, or by consent as provided in Article III, Section 14
hereof.
By-Laws 12
<PAGE>
Exhibit 3.13
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF EXISTENCE
To Whom These Presents Come, Greeting:
I, SUE ANNE GILROY, Secretary of State of Indiana, do hereby certify that
I am, by virtue of the laws of the State of Indiana, the custodian of the
corporate records and the proper official to execute this certificate.
I further certify that records of this office disclose that
NAVTRANS INTERNATIONAL FREIGHT FORWARDING INC
filed Articles of Incorporation on February 24, 1975, and is a corporation duly
organized and existing under and by virtue of the laws of the State of Indiana.
I further certify that this corporation has filed its most recent annual
report required by Indiana law with the Secretary of State, or is not yet
required to file such annual reports, and that Articles of Dissolution have not
been filed.
[SEAL] In Witness Whereof, I have hereunto set my
hand and affixed the seal of the State of
SEAL OF THE STATE OF INDIANA Indiana, at the City of Indianapolis, this
Sixteenth day of November, 1999.
1816
/s/ Sue Anne Gilroy
SUE ANNE GILROY, Secretary of State
[Illegible
Initials]
-----------
Deputy
<PAGE>
Corporate Certificate No. 151
(Sept. 1969)
[LOGO] 3
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF INCORPORATION
OF
NORTH AMERICAN DISTRIBUTIONS SYSTEMS, INC.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
I, LARRY A. CONRAD, Secretary of State of the State of Indiana, hereby
certify that Articles of Incorporation of the above Corporation, in the form
prescribed by my office, prepared and signed in duplicate by the
incorporator(s), and acknowledged and verified by the same before a Notary
Public, have been presented to me at my office accompanied by the fees
prescribed by law; that I have found such Articles conform to law; that I have
endorsed my approval upon the duplicate copies of such Articles; that all fees
have been paid as required by law; that one copy of such Articles has been filed
in my office; and that the remaining copy of such Articles bearing the
endorsement of my approval and filing has been returned by me to the
incorporator(s) or his (their) representatives; all as prescribed by the
provisions of the Indiana General Corporation Act, as amended.
Wherefore, I hereby issue to such Corporation this Certificate of
Incorporation, and further certify that its corporate existence has begun.
In Witness Whereof, I have hereunto set my hand and affixed
[SEAL] the seal of the State of Indiana, at the City of Indianapolis,
this 24th day of February, 1975
--------------------------------------------------------------
LARRY A. CONRAD, Secretary of State
By
------------------------------------------------------------
Deputy
<PAGE>
NOTE: This form may now also be used for incorporating pursuant to the Medical
Professional Corporation Act, the Dental Professional Corporation Act, and the
Professional Corporation Act of 1965, as well as the General Corporation Act. If
the corporation is to be formed pursuant to the authority of one of these
statutes other than the General Corporation Act, so indicate in the preamble
below, by striking the references to the three inappropriate statutes.
APPROVED
AND
FILED
FEB 24 1975
/s/ Larry A. Conrad
SECRETARY OF
STATE OF INDIANA
Corporate Form No. 101 (Jan. 1974) --Page One
ARTICLES OF INCORPORATION
Larry A. Conrad, Secretary of State of Indiana
Use White Paper--Size 8 1/2 x 11--For Inserts
Filing Requirements--Present 2 Executed Copies to Secretary of State, Room 155,
State House, Indianapolis 46204
Recording Requirements--Recording of Articles of Incorporation is no longer
required by the Indiana General Corporation Act.
ARTICLES OF INCORPORATION
OF
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
The undersigned incorporator or incorporators, desiring to form a
corporation (hereinafter referred to as the "Corporation") pursuant to the
provisions of the Indiana General Corporation Act (Medical Professional
Corporation Act/Dental Professional Corporation Act/Professional Corporation Act
of 1965), as amended (hereinafter referred to as the "Act",) execute the
following Articles of Incorporation.
ARTICLE I
Name
The name of the Corporation is North American Distribution Systems, Inc.
ARTICLE II
Purposes
The purposes for which the Corporation is formed are:
(1) To establish and carry on activities in connection with the
warehousing, including cold and dry storage, and distribution of all
goods, wares, merchandise and commodities; to maintain, buy, lease,
hire, build or otherwise operate buildings, storage houses and
conveniences for the care, keeping and transportation of such goods,
wares, merchandise and commodities; to issue warehouse receipts and
make advances and loans upon the security thereof; and to otherwise
acquire, sell, mortgage, pledge, lease, own or manage real or
personal property and engage in such activities necessary and
incident to the purposes set forth above.
<PAGE>
Page One(A)
(2) To buy, sell, hold, take and receive by way of absolute or security
title, and own and otherwise deal in merchandise, real and personal
property of any and every kind, nature and description.
(3) To borrow money and to issue, sell, pledge, mortgage or hypothecate
any of its real or personal properties to secure such loans.
(4) To do any and all other things necessary and incident to the
foregoing, or to do any and all things otherwise permissible under
Title 23, Article I, Chapter 2 of the Indiana Statutes.
<PAGE>
Corporate Form No. 101--Page Two
Prescribed by Larry A. Conrad, Secretary of State
(Jan. 1971)
ARTICLE III
Period of Existence
The period during which the Corporation shall continue is perpetual.
ARTICLE IV
Resident Agent and Principal Office
Section 1. Resident Agent. The name and address of the Resident Agent in
charge of the Corporation's principal office is
Lawrence P. Kahn P.O. Box 988
- --------------------------------------------------------------------------------
(Name) (Number and Street or Building)
Fort Wayne Indiana 46801
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Section 2. Principal Office. The post office address of the principal
office of the Corporation is
P. O. Box 411 New Haven, Indiana 46801
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
ARTICLE V
Shares
Section 1. Number.
A. The total number of shares which the Corporation has authority to issue is
1,000.
B. The number of shares which the corporation designates as having par value
is ____ with a par value of $__________.
C. The number of shares which the corporation designates as without par value
is 1,000.
Section 2. Terms.
Such shares may be sold by the Corporation for such an amount of consideration
as shall, from time to time, be fixed by the Board of Directors. Transfers of
shares may be made only upon the books of the Corporation by the holder named in
the certificate therefore, or by his attorney duly constituted in writing, and
upon surrender of such certificate properly endorsed by such holder; or the
secretary when so authorized by the Board of Directors, with or without the
surrender of such certificate.
<PAGE>
Page Two (A)
The Corporation shall have the right to treat the holder of record of any share
as a holder in fact thereof, and accordingly, shall not be bound to recognize
any equitable or other claims, to, or interest in, such share on the part of any
other person, whether or not it shall have express or other notice thereof.
Each share of stock shall be entitled to one vote.
<PAGE>
Corporate Form No. 101--Page Three
Prescribed by Larry A. Conrad, Secretary of State
(Jan. 1971)
ARTICLE VI
Requirements Prior To Doing Business
The Corporation will not commence business until consideration of the
value of at least $1,000.00 (one thousand dollars) has been received for the
issuance of shares.
ARTICLE VII
Director(s)
Section 1. Number of Directors. The initial Board of Directors is composed
of three member(s). The number of directors may be from time to time fixed by
the By-Laws of the Corporation at any number. In the absence of a By-Law fixing
the number of directors, the number shall be three.
Section 2. Names and Post Office Addresses of the Director(s). The name(s)
and post office address(es) of the initial Board of Director(s) of the
Corporation is (are):
Name Number and Street or Building City State Zip Code
---- ----------------------------- ---- ----- --------
Robert G. Dettmer P. O. Box 988 Fort Wayne, Indiana 46801
Kenneth W. Maxfield P. O. Box 988 Fort Wayne, Indiana 46801
Jack E. Schang P. O. Box 988 Fort Wayne, Indiana 46801
Section 3. Qualifications of Directors. (If Any):
none
<PAGE>
Corporate Form No. 101--Page Four
Prescribed by Larry A. Conrad, Secretary of State
(Jan. 1971)
ARTICLE VIII
Incorporator(s)
The name(s) and post office address(es) of the incorporator(s) of the
Corporation is (are):
Name Number and Street or Building City State Zip Code
---- ----------------------------- ---- ----- --------
Lawrence P. Kahn P. O. Box 988 Fort Wayne, Indiana 46801
ARTICLE IX
Provisions for Regulation of Business
and Conduct of Affairs of Corporation
Both shareholders and directors shall have the power to make, alter, amend, or
repeal the bylaws of the Corporation. Meetings of shareholders may be held
either within or without the State of Indiana if the bylaws so provide. The
books of the Corporation, except the duplicate stock register or transfer book,
may be kept either within or without the State of Indiana, at such place or
places as may be from time to time designated by the Board of Directors.
The Corporation reserves the right to alter, amend, change, or repeal any
provisions contained in these Articles of Incorporation, in the manner now or
hereafter prescribed by statute, and all rights confined upon shareholders
herein are granted subject to this reservation.
<PAGE>
Corporate Form No. 101--Page Five
Prescribed by Larry A. Conrad, Secretary of State
(Jan. 1971)
IN WITNESS WHEREOF, the undersigned, being the incorporator(s) designated
in Article VIII, execute these Articles of Incorporation and certify to the
truth of the facts herein stated, this 12th day of February, 1975.
/s/ Lawrence P. Kahn
- ------------------------------------ -------------------------------------
(Written Signature) (Written Signature)
Lawrence P. Kahn
- ------------------------------------ -------------------------------------
(Printed Signature) (Printed Signature)
-------------------------------------
(Written Signature)
-------------------------------------
(Printed Signature)
STATE OF INDIANA )
) ss:
COUNTY OF Allen )
I, the undersigned, a Notary Public duly commissioned to take
acknowledgements and administer oaths in the State of Indiana, certify that
Lawrence P. Kahn, being the incorporator referred to in Article VIII of the
foregoing Articles of Incorporation, personally appeared before me; acknowledged
the execution thereof; and swore to the truth of the facts therein stated.
Witness my hand and Notarial Seal this 12th day of February, 1975
/s/ Betty Jeanne Eggman
-------------------------------------
(Written Signature)
Betty Jeanne Eggman
-------------------------------------
(Printed Signature)
My Commission Expires: Notary Public
May 6, 1975
This instrument was prepared by Martin A. Weissert, Attorney at Law,
------------------
(Name)
P. O. Box 988 Fort Wayne, Indiana 46801
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
<PAGE>
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF AMENDED ARTICLES
OF
DEC 15 1981
MICROFILMED
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
- --------------------------------------------------------------------------------
I, EDWIN J. SIMCOX, Secretary of State of Indiana, hereby certify that
Amended Articles of Incorporation for the above Corporation, have been filed, in
the form prescribed by my office, prepared and signed in duplicate in accordance
with Chapter Four of the Indiana General Corporation Act (IC 23-1-4).
Now, therefore, upon due examination, I find that the Amended Articles of
Incorporation conform to law, and have endorsed my approval upon the duplicate
copies of such Articles; that all fees have been paid as required by law; that
one copy of such Articles bearing the endorsement of my approval and filing has
been returned by me to the Corporation.
In Witness Whereof, I have hereunto set my hand and affixed
the seal of the State of Indiana, at the City of Indianapolis,
[SEAL] this 1st day of December, 1981
--------------------------------------------------------------
EDWIN J. SIMCOX, Secretary of State
By
--------------------------------------------------------------
Deputy
<PAGE>
NOTE: This form may now also be used by corporations formed pursuant to the
Medical Professional Corporation Act, the Dental Professional Corporation Act,
and the Professional Corporation Act of 1965, as well as those formed pursuant
to the General Corporation Act. If the corporation is to be formed pursuant to
the authority of one of these statute other than the General Corporation Act, so
indicate in the preamble below, by striking the references to the three
inappropriate statutes.
APPROVED
AND
FILED
DEC 01 1981
/s/ Edwin J. Simcox
SECRETARY OF STATE OF INDIANA
Corporate Form No. 103 (Jan. 1974) --Page One
AMENDED ARTICLES (Completely superseding existing Articles)
Prescribed by Larry A. Conrad, Secretary of State of Indiana
Use White Paper--Size 8 1/2 x 11--for Inserts
Filing Requirements--Present 2 Executed Copies to Secretary of State, Room 155,
State House, Indianapolis 46204
Recording Requirements--Not required. However, if the name of the Corporation is
changed by these Articles, a certified Certificate of Amended Articles must be
filed with the County Recorder of every County where the Corporation owns real
property in Indiana.
AMENDED ARTICLES OF INCORPORATION
OF
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
The undersigned officers of NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
(hereinafter referred to as the "Corporation") existing pursuant to the
provisions of The Indiana General Corporation Act (Medical Professional
Corporation Act/Dental Professional Corporation Act/ Professional Corporation
Act of 1965), as amended (hereinafter referred to as the "Act"), desiring to
give notice of corporate action effectuating certain Amendments of its Articles
of Incorporation by the adoption of new Amended Articles of Incorporation to
supersede and take the place of its heretofore existing Articles of
Incorporation, certify the following facts:
ARTICLE I
Text of the Amended Articles
The exact text of the entire Articles of Incorporation of the Corporation,
as amended (hereinafter referred to as the "Amended Articles"), now is as
follows:
SEE ATTACHED ARTICLES OF INCORPORATION OF NORTH AMERICAN
DISTRIBUTION SYSTEMS, INC.
<PAGE>
NOTE: This form may now also be used for incorporating pursuant to the Medical
Professional Corporation Act, the Dental Professional Corporation Act, and the
Professional Corporation Act of 1965, as well as the General Corporation Act. If
the corporation is to be formed pursuant to the authority of one of these
statutes other than the General Corporation Act, so indicate in the preamble
below by striking the references to the three inappropriate statutes.
Professional Accounting Corporations are considered to be formed pursuant to the
authority of the Indiana General Corporation Act, but subject to the provisions
of IC 23-1-13.5, and appropriate statutory reference should be made in the
preamble or Article II below.
Corporate Form No. 101 (Jan. 1977)--Page One
ARTICLES OF INCORPORATION
Edwin J. Simcox, Secretary of State of Indiana
Use White Paper--Size 8 1/2 x 11--For Inserts
Filing Requirements--Present 2 originally signed and fully executed copies to
Secretary of State, Room 155, State House, Indianapolis 46204
Recording Requirements--Recording of Articles of Incorporation in the Office of
the County Recorder is no longer required by the Indiana General Corporation
Act.
ARTICLES OF INCORPORATION
OF
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
The undersigned incorporator or incorporators, desiring to form a
corporation (hereinafter referred to as the "Corporation") pursuant to the
provisions of the Indiana General Corporation Act (Medical Professional
Corporation Act/Dental Professional Corporation Act/Professional Corporation Act
of 1965), as amended (hereinafter referred to as the "Act"), execute the
following Articles of Incorporation.
ARTICLE I
Name
The name of the Corporation is North American Distribution Systems, Inc.
ARTICLE II
Purposes
The purposes for which the Corporation is formed are:
(1) To establish and carry on any and all activities in connection with, and to
make any and all arrangements for, the warehousing (including cold and dry
storage), transportation, and distribution of goods, wares, merchandise and
commodities of all kinds, in intrastate, interstate, or foreign commerce
("activities"); to maintain, buy, lease, hire, build or otherwise operate
offices, buildings, storage houses, equipment and conveniences for the conduct
of the activities; to issue warehouse receipts and make advances and loans upon
the security thereof and to issue, prepare, process, or handle any and all
documents connected with the activities; and to otherwise acquire, sell,
mortgage, pledge, lease, own or manage real or personal property and engage in
any and all
State Form 4159
<PAGE>
Page One A
actions necessary and incident to the conduct of the activities.
(2) To buy, sell, hold, take and receive by way of absolute or security title
and own and otherwise deal in merchandise, real or personal property of any and
every kind, nature and description.
(3) To borrow money and to issue, sell, pledge, mortgage or hypotecate any of
its real or personal properties to secure such a loan.
(4) To do any and all other things necessary and incident to the foregoing, or
to do any and all things otherwise permissible under Title 23, Article I,
Chapter 2 of the Indiana Statutes.
<PAGE>
Corporate Form No. 101--Page Two
Prescribed by Edwin J. Simcox, Secretary of State
(Jan. 1977)
ARTICLE III
Period of Existence
The period during which the Corporation shall continue is perpetual.
ARTICLE IV
Resident Agent and Principal Office
Section 1. Resident Agent. The name and address of the Corporation's
Resident Agent for service of process
is C T Corporation System 1011 Merchants Bank Building
-----------------------------------------------------------------------------
(Name) (Number and Street or Building)
Indianapolis, Indiana 46204
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Section 2. Principal Office. The post office address of the principal
office of the Corporation is
P. O. Box 988, Fort Wayne, Indiana 46801
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
ARTICLE V
Authorized Shares
Section 1. Number of Shares:
The total number of shares which the Corporation is to have authority to issue
is 1,000.
A. The number of authorized shares which the corporation designates as having
par value is __________ with a par value of $__________.
B. The number of authorized shares which the corporation designates as
without par value is 1,000.
Section 2. Terms of Shares (if any):
Such shares may be sold by the Corporation for such an amount of consideration
as shall, from time to time, be fixed by the Board of Directors. Transfers of
shares may be made only upon the books of the Corporation by the holder named in
the certificate therefor, or by his attorney duly constituted in writing, and
upon surrender of such certificate properly endorsed by such holder; or the
secretary when so authorized by the Board of Directors, with or without the
surrender of such certificate.
<PAGE>
Page Two (A)
The Corporation shall have the right to treat the holder of record of any share
as a holder in fact thereof, and accordingly, shall not be bound to recognize
any equitable or other claims, to, or interest in, such share on the part of any
other person, whether or not it shall have express or other notice thereof.
Each share of stock shall be entitled to one vote.
<PAGE>
Corporate Form No. 101--Page Three
Prescribed by Edwin J. Simcox, Secretary of State
(Jan. 1977)
ARTICLE VI
Requirements Prior To Doing Business
The Corporation will not commence business until consideration of the
value of at least $1,000 (one thousand dollars) has been received for the
issuance of shares.
ARTICLE VII
Director(s)
Section 1. Number of Directors. The initial Board of Directors is composed
of three member(s). The number of directors may be from time to time fixed by
the By-Laws of the Corporation at any number. In the absence of a By-Law fixing
the number of directors, the number shall be three.
Section 2. Names and Post Office Addresses of the Director(s). The name(s)
and post office address(es) of the initial Board of Director(s) of the
Corporation is (are):
Name Number and Street or Building City State Zip Code
---- ----------------------------- ---- ----- --------
Kenneth W. Maxfield, P. O. Box 988 Fort Wayne, IN 46801
Martin A. Weissert, P. O. Box 988 Fort Wayne, IN 46801
B. Wade Monroe, P. O. Box 988 Fort Wayne, IN 46801
Section 3. Qualifications of Directors (if any):
None.
<PAGE>
Corporate Form No. 101--Page Four
Prescribed by Edwin J. Simcox, Secretary of State
(Jan. 1977)
ARTICLE VIII
Incorporator(s)
The name(s) and post office address(es) of the incorporator(s) of the
Corporation is (are):
Name Number and Street or Building City State Zip Code
---- ----------------------------- ---- ----- --------
Kenneth W. Maxfield, P. O. Box 988 Fort Wayne, IN 46801
Margaret S. Vegeler, P. O. Box 988 Fort Wayne, IN 46801
ARTICLE IX
Provisions for Regulation of Business
and Conduct of Affairs of Corporation
("Powers" of the Corporation, its directors or shareholders)
Both shareholders and directors shall have the power to make, alter, amend, or
repeal the by-laws of the Corporation. Meetings of shareholders may be held
either within or without the State of Indiana if the bylaws so provide. The
books of the Corporation, except the duplicate stock register or transfer book,
may be kept either within or without the State of Indiana, at such place or
places as may be from time to time designated by the Board of Directors.
The Corporation reserves the right to alter, amend, change, or repeal any
provisions contained in these Articles of Incorporation, in the manner now or
hereafter prescribed by statute, and all rights confined upon shareholders
herein are granted subject to this reservation.
<PAGE>
Corporate Form No. 101--Page Five
Prescribed by Edwin J. Simcox, Secretary of State
(Jan. 1977)
IN WITNESS WHEREOF, the undersigned, being all of the incorporator(s)
designated in Article VIII, execute(s) these Articles of Incorporation and
certify to the truth of the facts herein stated, this 25th day of November,
1981.
/s/ Kenneth W. Maxfield /s/ Margaret S. Vegeler
- ------------------------------------ -------------------------------------
(Written Signature) (Written Signature)
Kenneth W. Maxfield Margaret S. Vegeler
- ------------------------------------ -------------------------------------
(Printed Signature) (Printed Signature)
-------------------------------------
(Written Signature)
-------------------------------------
(Printed Signature)
STATE OF INDIANA )
) ss:
COUNTY OF Allen )
I, the undersigned, a Notary Public duly commissioned to take
acknowledgements and administer oaths in the State of Indiana, certify that
Kenneth W. Maxfield and Margaret S. Vegeler, being all of the incorporator(s)
referred to in Article VIII of the foregoing Articles of Incorporation,
personally appeared before me; acknowledged the execution thereof; and swore to
the truth of the facts therein stated.
Witness my hand and Notarial Seal this 25th day of November, 1981.
/s/ Janet L. Bredeweg
-------------------------------------
(Written Signature)
Janet L. Bredeweg
-------------------------------------
(Printed Signature)
My Commission Expires: Notary Public
6/4/83
This instrument was prepared by Bruce W. Boyarko, Attorney at Law,
----------------
(Name)
5001 U.S. Highway 30 West, Fort Wayne, IN 46818
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
<PAGE>
Corporate Form No. 103--Page Two
Prescribed by Larry A. Conrad, Secretary of State
(Sept. 1969)
ARTICLE II
Manner of Adoption and Vote
Section 1. Action by Directors (select appropriate paragraph).
(a) The Board of Directors of the Corporation, at a meeting thereof, duly
called, constituted and held on ________________________, 19__, at which a
quorum of such Board of Directors was present, duly adopted a resolution
proposing to the Shareholders of the Corporation entitled to vote in respect of
the Amended Articles that the provisions and terms of Article ______ of its
Articles of Incorporation be amended so as to read as set forth in the
Amendments; and called a meeting of such shareholders, to be held
________________________, 19__, to adopt or reject the Amendments, unless the
same were so approved prior to such date by unanimous written consent.
(b) By written consent executed on October 1, 1981, signed by all of the
members of the Board of Directors of the Corporation, a resolution was adopted
proposing to the Shareholders of the corporation entitled to vote in respect of
the Amended Articles, that the provisions and terms of Article ______ of its
Articles of Incorporation be amended so as to read as set forth in the Amended
Articles, and a meeting of such shareholders was called to be held October 23,
1981, to adopt or reject the Amendments, unless the same were so approved prior
to such date by unanimous written consent.
Section 2. Action by Shareholders (select appropriate paragraph).
(a) The Shareholders of the Corporation entitled to vote in respect of the
Amended Articles, at a meeting thereof, duly called, constituted and held on
________________________, 19__, at which________________________________________
________________________________________________________________________________
________________________________________________________________________________
were present in person or by proxy, adopted the Amendments.
The holders of the following classes of shares were entitiled to vote as a
class in respect of the Amendments:
(1)
(2)
(3)
<PAGE>
Corporate Form No. 103--Page Three
Prescribed by Larry A. Conrad, Secretary of State
(Sept. 1969)
The number of shares entitled to vote in respect of the Amendments, the
number of shares voted in favor of the adoption of the Amendments, and the
number of shares voted against such adoption are as follows:
Total Shares Entitled to Vote as a Class
----- (1) (2) (3)
Shares entitled to vote: _________ _________ _________ _________
Shares voted in favor: _________ _________ _________ _________
Shares voted against: _________ _________ _________ _________
(b) By written consent executed on October 23, 1981, signed by the holders
of __ shares of the Corporation, being all of the shares of the Corporation
entitled to vote in respect of the Amendments, the Shareholders adopted the
Amended Articles.
Section 3. Compliance with Legal Requirements.
The manner of the adoption of the Amended Articles, and the vote by which
they were adopted, constitute full legal compliance with the provisions of the
Act, the Articles of Incorporation, and the By-Laws of the Corporation.
ARTICLE III
Statement of Changes Made With Respect to Any Increase
In The Number of Shares Heretofore Authorized
<PAGE>
Corporate Form No. 103--Page Four
Prescribed by Larry A. Conrad, Secretary of State
(Sept. 1969)
IN WITNESS WHEREOF, the undersigned officers execute these Amended
Articles of Incorporation of the Corporation, and certify to the truth of the
facts herein stated, this 25th day of November, 1981.
/s/ Kenneth W. Maxfield /s/ Margaret S. Vegeler
- ----------------------------------- ----------------------------------------
(Written Signature) (Written Signature)
Kenneth W. Maxfield Margaret S. Vegeler
- ----------------------------------- ----------------------------------------
(Printed Signature) (Printed Signature)
President of Secretary of
North American Distribution North American Distributions Systems,
Systems, Inc. Inc.
- ----------------------------------- ----------------------------------------
(Name of Corporation) (Name of Corporation)
STATE OF INDIANA }
} SS:
COUNTY OF Allen }
I, the undersigned, a Notary Public duly commissioned to take
acknowledgements and administer oaths in the State of Indiana, certify that
Kenneth W. Maxfield, the President, and Margaret S. Vegeler, the Secretary of
North American Distribution Systems, Inc. the officers executing the foregoing
Amended Articles of Incorporation, personally appeared before me, acknowledged
the execution thereof, and swore to the truth of the facts therein stated.
Witness my hand and Notarial Seal this 25th day of November, 1981.
/s/ Janet L. Bredeweg
-------------------------------------
(Written Signature)
Janet L. Bredeweg
-------------------------------------
(Printed Signature)
My Commission Expires: Notary Public
6/4/83
This instrument was prepared by Bruce W. Boyarko, Attorney at Law,
----------------
(Name)
5001 U.S. Highway 30 West, Fort Wayne, IN 46818
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
<PAGE>
State Form 39079
SS-CS1
Rev. 12-79
JAN 19 1982
MICROFILMED
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF ASSUMED NAME
To Whom These Presents Come, Greeting:
WHEREAS, there has been presented to me at this office by
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
an Indiana corporation, a certificate that said corporation is doing business
under the assumed business name(s) of:
NAVTRANS INTERNATIONAL FREIGHT FORWARDING
said certificate having been prepared and signed in accordance with the
requirements of Indiana law, and having been filed with the Office of the
Recorder of ALLEN County;
WHEREAS, upon due examination, I find that the same conforms to law; NOW
THEREFORE, I, EDWIN J. SIMCOX, hereby certify that I have this day endorsed my
approval on such certificate of assumed business name, and having received the
fees required by law, have filed such certificate in this office bearing the
endorsement of my approval of said assumed business name.
In Witness Whereof, I have hereunto set my hand
and affixed the seal of the State of Indiana, at the
[SEAL] City of Indianapolis, this 28th day of
December, 1981
----------------------------------------------------
EDWIN J. SIMCOX Secretary of State
By
----------------------------------------------------
Deputy
<PAGE>
APPROVED
AND
FILED
DEC 28 1981
/s/ Edwin J. Simcox
SECRETARY OF STATE OF INDIANA
STATE OF INDIANA, ALLEN COUNTY, SS: 81-24854
Recorder's Office.
I, Virginia L. Young, Recorder in and for said County, do hereby certify that
the above is a true and complete copy of the record of a Certificate of Use of
Assumed Name from North American Distribution Systems, Inc. to NAVTRANS
International Freight Forwarding as the same appears on the Records of this
office in _________________________ Document No. 81-24853, of which record I am
the lawful custodian.
Book No. _________________ Page __________________
WITNESS my hand and official seal, at Fort Wayne, Indiana,
this 16th day of December A.D. 1981
/s/ Virginia L. Young
----------------------------------------------------------
Recorder Allen County, Indiana.
<PAGE>
1981 DEC [ILLEGIBLE] [ILLEGIBLE] 81-24853
ALLEN COUNTY RECORDER APPROVED
/s/ Virginia L. Young AND
FILED
DEC 28 1981
(For Use By Corporation) /s/ Edwin J. Simcox Recorder
SECRETARY OF STATE OF INDIANA Form 1
CERTIFICATE OF ASSUMED NAME
(Filed Pursuant to Burns 50-201)
It is hereby certified that
North American Distribution Systems, Inc.
--------------------------------------------------------------------
(Name of Corporation)
a Indiana Corporation
-----------------------------
(State in which Incorporated)
with its principal office at
5001 U. S. Highway 30 West
Fort Wayne, Indiana 46818
is conducting business under the following name(s) other than as shown by its
Articles of Incorporation, to wit:
NAVTRANS International Freight Forwarding
WITNESS my hand and the seal of said corporation this 14th day of
December, 1981.
North American Distribution Systems, Inc.
-----------------------------------------
(Name of Corporation)
(Corporate Seal) By: /s/ B. Wade Monroe
-------------------------------------
(Signature of Officer)
ATTEST: /s/ B. Wade Monroe
-------------------------------------
(Name Typed)
/s/ Margaret s. Vegeler
- ----------------------------------- -------------------------------------
(Name Typed)
Margaret S. Vegeler , Secretary Treasurer
- ------------------------ -------------------------------------
(Name Typed) (Title)
STATE OF INDIANA }
} SS:
COUNTY OF ALLEN }
B. Wade Monroe, whose signature appears above, being first duly sworn upon
his oath, says that he has personal knowledge of the above stated facts and that
they and each of them are true.
(Signed) /s/ B. Wade Monroe
-----------------------------------------
Subscribed and sworn to before me, a notary public, in and for said county
and state this 14th day of December, 1981.
(Notary Seal) /s/ Betty Jeanne Eggman
-----------------------------------------
MY COMMISSION EXPIRES: Betty Jeanne Eggman
May 8, 1983 -----------------------------------------
- --------------------------------- (Name Typed)
NOTARY PUBLIC
A Resident of Allen County.
- --------------------------------------------------------------------------------
I, Virginia L. Young, RECORDER OF ALLEN COUNTY, Allen County, Indiana,
hereby certify that the above and foregoing is a true, full and correct copy
of a certain Certificate of Use of Assumed Name filed by North American
Distribution Systems, Inc., an Indiana Corporation, as the same appears and
remains in the records of my office. Witness my hand and the seal of my office
this 16th day of December, 1981.
/s/ Virginia L. Young
-----------------------------------------
RECORDER OF ALLEN COUNTY,
INDIANA
<PAGE>
Form SSC-32
State Form 37020
JAN 14 1983
MICROFILMED
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF AMENDMENT
OF
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
- --------------------------------------------------------------------------------
I, EDWIN J. SIMCOX, Secretary of State of Indiana, hereby certify that
Articles of Amendment for the above Corporation have been filed in the form
prescribed by my office, prepared and signed in duplicate in accordance with
Chapter Four of the Indiana General Corporation Act (IC 23-1-4). The name is
amended to:
NAVTRANS INTERNATIONAL FREIGHT FORWARDING, INC.
NOW, THEREFORE, upon due examination, I find that the Articles of
Amendment conform to law, and have endorsed my approval upon the duplicate
copies of such Articles; that all fees have been paid as required by law; that
one copy of such Articles bearing the endorsement of my approval and filing has
been returned by me to the Corporation.
In Witness Whereof, I have hereunto set my hand and affixed
the seal of the State of Indiana, at the City of Indianapolis,
[SEAL] this 27th day of December, 1982
--------------------------------------------------------------
EDWIN J. SIMCOX, Secretary of State
By
--------------------------------------------------------------
Deputy
<PAGE>
APPROVED
AND
FILED
DEC 27 1982
/s/ Edwin J. Simcox
SECRETARY OF STATE OF INDIANA
Corporate Form No. 102 (Jan. 1971)--Page One
ARTICLES OF AMENDMENT (Amending Individual Articles Only)
Prescribed by Larry A. Conrad, Secretary of State of Indiana
Use Size 8 1/2 x 11 White Paper for Inserts
Filing Requirements--Present 2 Executed Copies to Secretary of State, Room 155,
State House, Indianapolis 46204
Recording Requirements--Not Required. However, if the name of the Corporation is
changed by these Articles, a certified Certificate of Amendment must be filed
with the County Recorder of every County where the Corporation owns real
property in Indiana.
ARTICLES OF AMENDMENT
OF THE
ARTICLES OF INCORPORATION
OF
North American Distribution Systems, Inc.
The undersigned officers of North American Distribution Systems, Inc.
(hereinafter referred to as the "Corporation") existing pursuant to the
provisions of The Indiana General Corporation Act, as amended (hereinafter
referred to as the "Act"), desiring to give notice of corporate action
effectuating amendment of certain provisions of its Articles of Incorporation,
certify the following facts:
ARTICLE I
Text of the Amendment
The exact text of Article(s) I of the Articles of Incorporation of the
Corporation, as amended (hereinafter referred to as the "Amendments"), now is as
follows:
Article I
The name of the corporation is NAVTRANS International Freight Forwarding,
Inc.
<PAGE>
Corporate Form No. 102 (Jan. 1971)--Page Two
Prescribed by Larry A. Conrad, Secretary of State
of Indiana
ARTICLE II
Manner of Adoption and Vote
Section 1. Action by Directors (select appropriate paragraph).
(a) The Board of Directors of the Corporation, at a meeting thereof, duly
called, constituted and held on ________________________, 19__, at which a
quorum of such Board of Directors was present, duly adopted a resolution
proposing to the Shareholders of the Corporation entitled to vote in respect the
Amendments that the provisions and terms of Article ______ of its Articles of
Incorporation be amended so as to read as set forth in the Amendments; and
called a meeting of such shareholders, to be held ________________________,
19__, to adopt or reject the Amendments, unless the same were so approved prior
to such date by unanimous written consent.
(b) By written consent executed on October 4, 1982, signed by all of the
members of the Board of Directors of the Corporation, a resolution was adopted
proposing to the Shareholders of the Corporation entitled to vote in respect of
the Amendments, that the provisions and terms of Article of its Articles of
Incorporation be amended so as to read as set forth in the Amendments, and a
meeting of such shareholders was called to be held October 25, 1982, to adopt or
reject the Amendments, unless the same were so approved prior to such date by
unanimous written consent.
Section 2. Action by Shareholders (select appropriate paragraph).
(a) The Shareholders of the Corporation entitled to vote in respect of the
Amendments, at a meeting thereof, duly called, constituted and held on
________________________, 19__, at which _______________________________________
________________________________________________________________________________
________________________________________________________________________________
were present in person or by proxy, adopted the Amendments.
The holders of the following classes of shares were entitiled to vote as a
class in respect of the Amendments:
(1)
(2)
(3)
<PAGE>
Corporate Form No. 102 (Jan. 1971)--Page Three
Prescribed by Larry A. Conrad, Secretary of State
of Indiana
The number of shares entitled to vote in respect of the Amendments, the
number of shares voted in favor of the adoption of the Amendments, and the
number of shares voted against such adoption are as follows:
Total Shares Entitled to Vote as a Class
----- (as listed immediately above)
-----------------------------
(1) (2) (3)
Shares entitled to vote: _________ _________ _________ _________
Shares voted in favor: _________ _________ _________ _________
Shares voted against: _________ _________ _________ _________
(b) By written consent executed on October 25, 1982, signed by the
holders of 1,000 shares of the Corporation, being all of the shares of the
Corporation entitled to vote in respect of the Amendments, the Shareholders
adopted the Amendments.
Section 3. Compliance with Legal Requirements.
The manner of the adoption of the Amendments, and the vote by which they
were adopted, constitute full legal compliance with the provisions of the Act,
the Articles of Incorporation, and the By-Laws of the Corporation.
ARTICLE III
Statement of Changes Made With Respect to Any Increase
In The Number of Shares Heretofore Authorized
Aggregate Number of Shares
Previously Authorized ____________
Increase ____________
Aggregate Number of Shares
To Be Authorized After Effect of This Amendment ____________
<PAGE>
Corporate Form No. 102 (Jan. 1971--Page Four
Prescribed by Larry A. Conrad, Secretary of State
of Indiana
IN WITNESS WHEREOF, the undersigned officers execute these Articles of
Amendment of the Articles of Incorporation of the Corporation, and certify to
the truth of the facts herein stated, this 7th day of December, 1982.
/s/ Kenneth W. Maxfield /s/ Margaret S. Vegeler
- ----------------------------------- ----------------------------------------
(Written Signature) (Written Signature)
Kenneth W. Maxfield Margaret S. Vegeler
- ----------------------------------- ----------------------------------------
(Printed Signature) (Printed Signature)
President of Secretary of
North American Distribution North American Distribution Systems,
Systems, Inc. Inc.
- ----------------------------------- ----------------------------------------
(Name of Corporation) (Name of Corporation)
STATE OF INDIANA }
} SS:
COUNTY OF Allen }
I, the undersigned, a Notary Public duly commissioned to take
acknowledgements and administer oaths in the State of Indiana, certify that
Kenneth W. Maxfield, the President, and Margaret S. Vegeler, the Secretary of
North American Distribution Systems, Inc., the officers executing the foregoing
Articles of Amendment of the Articles of Incorporation, personally appeared
before me, acknowledged the execution thereof, and swore to the truth of the
facts therein stated.
Witness my hand and Notarial Seal this 7th day of December, 1982.
/s/ Carol J. Korte
-----------------------------------
(Written Signature)
Carol J. Korte
-----------------------------------
(Printed Signature)
My Commission Expires: Notary Public
7/15/86
- ------------------------------------
COUNTY OF RESIDENCE: Allen
This instrument was prepared by Mark J. Fritz , Attorney at Law,
------------------------------
(Name)
P.O. Box 988 Fort Wayne Indiana 46801
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
<PAGE>
Form SSC-32
State Form 37020
JUL 12 1985
MICROFILMED
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF AMENDMENT
OF
NAVTRANS INTERNATIONAL FREIGHT FORWARDING, INC.
I, EDWIN J. SIMCOX, Secretary of State of Indiana, hereby certify that
Articles of Amendment for the above Corporation have been filed in the form
prescribed by my office, prepared and signed in duplicate in accordance with
Chapter Four of the Indiana General Corporation Act (IC 23-1-4).
NOW, THEREFORE, upon due examination, I find that the Articles of
Amendment conform to law, and have endorsed my approval upon the duplicate
copies of such Articles; that all fees have been paid as required by law; that
one copy of such Articles has been filed in my office; and that the remaining
copy of such Articles bearing the endorsement of my approval and filing has been
returned by me to the Corporation.
In Witness Whereof, I have hereunto set my hand and affixed
the seal of the State of Indiana, at the City of Indianapolis,
[SEAL] this 2nd day of July, 1985
--------------------------------------------------------------
EDWIN J. SIMCOX, Secretary of State
By
--------------------------------------------------------------
Deputy
<PAGE>
NOTE: This form may now also be used for amending pursuant to the Medical
Professional Corporation Act, the Dental Professional Corporation Act, and the
Professional Corporation Act of 1965, as well as the General Corporation Act. If
the corporation was formed pursuant to the authority of one of these
statutes other than the General Corporation Act, so indicate in the preamble
below by striking the references to the three inappropriate statutes.
Professional Accounting Corporations are considered to be formed pursuant to the
authority of the Indiana General Corporation Act, but subject to the provisions
of IC 23-1-13.5, and appropriate statutory reference should be made in the
preamble or Article I below.
APPROVED
AND
FILED
JUL 02 1985
/s/ Edwin J. Simcox
SECRETARY OF STATE OF INDIANA
State Form 38333
Corporate Form No. 102 (Oct. 1977) -- Page One
ARTICLES OF AMENDMENT (Amending Individual Articles Only)
Prescribed by Edwin J. Simcox, Secretary of State of Indiana
Use Size 8 1/2 x 11 White Paper for Inserts
Filing Requirements--Present 2 originally signed and fully executed copies to
Secretary of State, Room 155, State House, Indianapolis 46204
Recording Requirements--Recording of Articles of Amendment in the Office of the
County Recorder is generally no longer required by the Indiana General
Corporation Act. However, if the name of the corporation is changed by this
amendment, a certified copy of the Certificate of Amendment must be filed with
the Recorder of every county in which the corporation owns real estate.
ARTICLES OF AMENDMENT
OF THE
ARTICLES OF INCORPORATION
OF
NAVTRANS INTERNATIONAL FREIGHT FORWARDING, INC.
The undersigned officers of NAVTRANS International Freight Forwarding,
Inc. (hereinafter referred to as the "Corporation") existing pursuant to the
provisions of the Indiana General Corporation Act (Medical Professional
Corporation Act/Dental Professional Corporation Act/Professional Corporation Act
of 1965), as amended (hereinafter referred to as the "Act"), desiring to give
notice of corporate action effectuating amendment of certain provisions of its
Articles of Incorporation, certify the following facts:
ARTICLE I
Text of the Amendment
The exact text of Article(s) II of the Articles of Incorporation of the
Corporation, as amended (hereinafter referred to as the "Amendments"), now is as
follows:
See Insert Number 1.
<PAGE>
Insert Number 1
(1) To establish and carry on any and all activities in connection with, and to
make any and all arrangements for, the warehousing (including cold and dry
storage), transportation, and distribution of goods, wares, merchandise, and
commodities of all kinds, in intrastate, interstate, or foreign commerce
("activities"); to maintain, buy, lease, hire, build or otherwise operate
offices, buildings, storage houses, equipment and conveniences for the conduct
of the activities; to issue warehouse receipts and make advances and loans upon
the security thereof and to issue, prepare, process, or handle any and all
documents connected with the activities; and to otherwise acquire, sell,
mortgage, pledge, lease, own or manage real or personal property and engage in
any and all actions necessary and incident to the conduct of the activities.
(2) To establish and carry on any and all activities in connection with the
transaction of corporate customhouse brokerage business ("activities") in
compliance with all applicable state and federal laws, licensing procedures and
regulations; to maintain, buy, lease, hire, build or otherwise operate offices,
buildings, storage houses, equipment and conveniences for the conduct of
activities; to issue, prepare, process, or handle any and all documents
connected with the activities, and to otherwise acquire, sell, mortgage, pledge,
lease, own or manage real or personal property and engage in any and all actions
necessary and incident to the conduct of the activities.
(3) To buy, sell, hold, take and receive by way of absolute or security title
and own and otherwise deal in merchandise, real or personal property of any and
every kind, nature and description.
(4) To borrow money and to issue, sell, pledge, mortgage or hypothecate any of
its real or personal properties to secure such a loan.
(5) To do any and all other things necessary and incident to the foregoing, or
to do any and all things otherwise permissible under Title 23, Article I,
chapter 2 of the Indiana Statutes.
<PAGE>
Corporate Form No. 102 (Oct. 1979) -- Page Two
ARTICLE II
Manner of Adoption and Vote
Section 1. Action by Directors (select appropriate paragraph).
(a) The Board of Directors of the Corporation, at a meeting thereof, duly
called, constituted and held on ________________________, 19__, at which a
quorum of such Board of Directors was present, duly adopted a resolution
proposing to the Shareholders of the Corporation entitled to vote in respect of
the Amendments that the provisions and terms of Article(s) ______ of its
Articles of Incorporation be amended so as to read as set forth in the
Amendments; and called a meeting of such shareholders, to be held
________________________, 19__, to adopt or reject the Amendments, unless the
same were so approved prior to such date by unanimous written consent.
(b) By written consent executed on June 28, 1985, signed by all of the
members of the Board of Directors of the Corporation, a resolution was adopted
proposing to the Shareholders of the corporation entitled to vote in respect of
the Amendments, that the provisions and terms of Articles of its Articles of
Incorporation be amended so as to read as set forth in the Amendments, and
a meeting of such shareholders was called to be held June 28, 1985, to adopt
or reject the Amendments, unless the same were so approved prior to such date by
unanimous written consent.
Section 2. Action by Shareholders (select appropriate paragraph).
(a) The Shareholders of the Corporation entitled to vote in respect of the
Amendments, at a meeting thereof, duly called, constituted and held on
________________________, 19__, at which a quorum of such shareholders was
present, adopted the Amendments.
The holders of the following classes of shares were entitiled to vote as a
class in respect of the Amendments:
(1)
(2)
(3)
<PAGE>
Corporate Form No. 102 (Oct. 1979) -- Page Three
The number of shares entitled to vote in respect of the Amendments, the
number of shares voted in favor of the adoption of the Amendments, and the
number of shares voted against such adoption are as follows:
Total Shares Entitled to Vote as a Class
----- (as listed immediately above)
-----------------------------
(1) (2) (3)
Shares entitled to vote: _________ _________ _________ _________
Shares voted in favor: _________ _________ _________ _________
Shares voted against: _________ _________ _________ _________
(b) By written consent executed on June 28, 1985, signed by the
holders of all shares of the Corporation, being all of the shares of the
Corporation entitled to vote in respect of the Amendments, the Shareholders
adopted the Amendments.
Section 3. Compliance with Legal Requirements.
The manner of the adoption of the Amendments, and the vote by which they
were adopted, constitute full legal compliance with the provisions of the Act,
the Articles of Incorporation, and the By-Laws of the Corporation.
ARTICLE III
Statement of Changes Made With Respect to Any Increase
In The Number of Shares Heretofore Authorized
Aggregate Number of Shares
Previously Authorized ____________
Increase (indicate "0" or "N/A" if no increase) N/A
Aggregate Number of Shares
To Be Authorized After Effect of This Amendment ____________
<PAGE>
Corporate Form No. 102 (Oct. 1979) -- Page Four
IN WITNESS WHEREOF, the undersigned officers execute these Articles of
Amendment of the Articles of Incorporation of the Corporation, and certify to
the truth of the facts herein stated, this 28th day of June, 1985.
/s/ Kenneth W. Maxfield /s/ Margaret S. Vegeler
- ----------------------------------- ----------------------------------------
(Written Signature) (Written Signature)
Kenneth W. Maxfield Margaret S. Vegeler
- ----------------------------------- ----------------------------------------
(Printed Signature) (Printed Signature)
President or Vice President Secretary or Assistant Secretary
STATE OF INDIANA }
} SS:
COUNTY OF Allen }
I, the undersigned, a Notary Public duly commissioned to take
acknowledgements and administer oaths in the State of Indiana, certify that K.
W. Maxfield, the President, and Margaret S. Vegeler, the Secretary of the
Corporation, the officers executing the foregoing Articles of Amendment of the
Articles of Incorporation, personally appeared before me, acknowledged the
execution thereof, and swore or attested to the truth of the facts therein
stated.
Witness my hand and Notarial Seal this 28 day of June, 1985.
/s/ Necia D. Stucker
-----------------------------------
(Written Signature)
Necia D. Stucker
-----------------------------------
(Printed Signature)
NOTARY PUBLIC
My Commission Expires: My County of Residence is:
9-28-87 Allen
This instrument was prepared by , Attorney at Law,
-------------------------------
(Name)
- --------------------------------------------------------------------------------
(Number and Street or Building) (City) (State) (Zip Code)
<PAGE>
Exhibit 3.14
================================================================================
Minutes
and
By Laws
OF
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
INCORPORATED UNDER THE LAWS OF
THE STATE OF INDIANA
================================================================================
<PAGE>
BY-LAWS
OF
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
ARTICLE I - OFFICES
The principal office of the corporation in the State of Indiana shall be
located in the City of New Haven, County of Allen. The corporation may have such
other offices, either within or without the State of incorporation as the board
of directors may designate or as the business of the corporation may from time
to time require.
ARTICLE II - STOCKHOLDERS
1. ANNUAL MEETING.
The annual meeting of the stockholders shall be held on the 1st day of
March in each year, beginning with the year 1976 at the hour 10 o'clock A.M.,
for the purpose of electing directors and for the transaction of such other
business as may come before the meeting. If the day fixed for the annual meeting
shall be a legal holiday such meeting shall be held on the next succeeding
business day.
2. SPECIAL MEETINGS.
Special meetings of the stockholders, for any purpose or purposes, unless
otherwise prescribed by statute, may be called by the president or by the
directors, and shall be called by the president at the request of the holders of
not less than 50 per cent of all the outstanding shares of the corporation
entitled to vote at the meeting.
3. PLACE OF MEETING.
The directors may designate any place, either within or without the State
unless otherwise prescribed by statute, as the place of meeting for any annual
meeting or for any special meeting called by the directors. A waiver of notice
signed by all stockholders entitled to vote at a meeting may designate
By-Laws 1
<PAGE>
any place, either within or without the state unless otherwise prescribed by
statute, as the place for holding such meeting. If no designation is made, or if
a special meeting be otherwise called, the place of meeting shall be the
principal office of the corporation.
4. NOTICE OF MEETING.
Written or printed notice stating the place, day and hour of the meeting
and, in case of a special meeting, the purpose or purposes for which the meeting
is called, shall be delivered not less than 10 nor more than 30 days before the
date of the meeting, either personally or by mail, by or at the direction of the
president, or the secretary, or the officer or persons calling the meeting, to
each stockholder of record entitled to vote at such meeting. If mailed, such
notice shall be deemed to be delivered when deposited in the United States mail,
addressed to the stockholder at his address as it appears on the stock transfer
books of the corporation, with postage thereon prepaid.
5. CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE.
For the purpose of determining stockholders entitled to notice of or to
vote at any meeting of stockholders or any adjournment thereof, or stockholders
entitled to receive payment of any dividend, or in order to make a determination
of stockholders for any other proper purpose, the directors of the corporation
may provide that the stock transfer books shall be closed for a stated period
but not to exceed, in any case, 30 days. If the stock transfer books shall be
closed for the purpose of determining stockholders entitled to notice of or to
vote at a meeting of stockholders, such books shall be closed for at least 10
days immediately preceding such meeting. In lieu of closing the stock transfer
books, the directors may fix in advance a date as the record date for any such
determination of stockholders, such date in any case to be not more than 30 days
and, in case of a meeting of stockholders, not less than 30 days prior to the
date on which the particular action requiring such determination of stockholders
is to be taken. If the stock transfer books are not closed and no record date is
fixed for the determination of stockholders entitled to notice of or to vote at
a meeting of stockholders, or stockholders entitled to receive payment of a
dividend, the date on which notice of the meeting is mailed or the date on which
the resolution of the directors declaring such dividend is adopted, as the case
may be, shall be the record date for such determination of stockholders. When a
determination of stockholders entitled to vote at any meeting of stockholders
By-Laws 2
<PAGE>
has been made as provided in this section, such determination shall apply to any
adjournment thereof.
6. VOTING LISTS.
The officer or agent having charge of the stock transfer books for shares
of the corporation shall make, at least 10 days before each meeting of
stockholders, a complete list of the stockholders entitled to vote at such
meeting, or any adjournment thereof, arranged in alphabetical order, with the
address of and the number of shares held by each, which list, for a period of 10
days prior to such meeting, shall be kept on file at the principal office of the
corporation and shall be subject to inspection by any stockholder at any time
during usual business hours. Such list shall also be produced and kept open at
the time and place of the meeting and shall be subject to the inspection of any
stockholder during the whole time of the meeting. The original stock transfer
book shall be prima facie evidence as to who are the stockholders entitled to
examine such list or transfer books or to vote at the meeting of stockholders.
7. QUORUM.
At any meeting of stockholders 50 per cent of the outstanding shares of
the corporation entitled to vote, represented in person or by proxy, shall
constitute a quorum at a meeting of stockholders. If less than said number of
the outstanding shares are represented at a meeting, a majority of the shares so
represented may adjourn the meeting from time to time without further notice. At
such adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally notified. The stockholders present at a duly organized meeting may
continue to transact business until adjournment, notwithstanding the withdrawal
of enough stockholders to leave less than a quorum.
8. PROXIES.
At all meetings of stockholders, a stockholder may vote by proxy executed
in writing by the stockholder or by his duly authorized attorney in fact. Such
proxy shall be filed with the secretary of the corporation before or at the time
of the meeting.
9. VOTING.
Each stockholder entitled to vote in accordance with the terms and
provisions of the certificate of incorporation and these by-laws shall be
entitled to one vote, in person or by
By-Laws 3
<PAGE>
proxy, for each share of stock entitled to vote held by such stockholders. Upon
the demand of any stockholder, the vote for directors and upon any question
before the meeting shall be by ballot. All elections for directors shall be
decided by plurality vote; all other questions shall be decided by majority vote
except as otherwise provided by the Certificate of Incorporation or the laws of
this State.
10. ORDER OF BUSINESS.
The order of business at all meetings of the stockholders, shall be as
follows:
1. Roll Call.
2. Proof of notice of meeting or waiver of notice.
3. Reading of minutes of preceding meeting.
4. Reports of Officers.
5. Reports of Committees.
6. Election of Directors.
7. Unfinished Business.
8. New Business.
11. INFORMAL ACTION BY STOCKHOLDERS.
Unless otherwise provided by law, any action required to be taken at a
meeting of the shareholders, or any other action which may be taken at a meeting
of the shareholders, may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall be signed by all of the shareholders
entitled to vote with respect to the subject matter thereof.
By-Laws 4
<PAGE>
ARTICLE III - BOARD OF DIRECTORS
1. GENERAL POWERS.
The business and affairs of the corporation shall be managed by its board
of directors. The directors shall in all cases act as a board, and they may
adopt such rules and regulations for the conduct of their meetings and the
management of the corporation, as they may deem proper, not inconsistent with
these by-laws and the laws of this State.
2. NUMBER, TENURE AND QUALIFICATIONS.
The number of directors of the corporation shall be three. Each director
shall hold office until the next annual meeting of stockholders and until his
successor shall have been elected and qualified.
3. REGULAR MEETINGS.
A regular meeting of the directors, shall be held without other notice
than this by-law immediately after, and at the same place as, the annual meeting
of stockholders. The directors may provide, by resolution, the time and place
for the holding of additional regular meetings without other notice than such
resolution.
4. SPECIAL MEETINGS.
Special meetings of the directors may be called by or at the request of
the president or any two directors. The person or persons authorized to call
special meetings of the directors may fix the place for holding any special
meeting of the directors called by them.
5. NOTICE.
Notice of any special meeting shall be given at least ten days previously
thereto by written notice delivered personally, or by telegram or mailed to each
director at his business address. If mailed, such notice shall be deemed to be
delivered when deposited in the United States mail so addressed, with postage
thereon prepaid. If notice be given by telegram, such notice shall be deemed to
be delivered when the telegram is delivered to the telegraph company. The
attendance of a director at a meeting shall constitute a waiver of notice of
such meeting, except where a director attends a meeting for the express purpose
of objecting to the transaction of any business because the meeting is not
lawfully called or convened.
By-Laws 5
<PAGE>
6. QUORUM.
At any meeting of the directors, two shall constitute a quorum for the
transaction of business, but if less than said number is present at a meeting, a
majority of the directors present may adjourn the meeting from time to time
without further notice.
7. MANNER OF ACTING.
The act of the majority of the directors present at a meeting at which a
quorum is present shall be the act of the directors.
8. NEWLY CREATED DIRECTORSHIPS AND VACANCIES.
Newly created directorships resulting from an increase in the number of
directors and vacancies occurring in the board for any reason except the removal
of directors without cause may be filled by a vote of a majority of the
directors then in office, although less than a quorum exists. Vacancies
occurring by reason of the removal of directors without cause shall be filled by
vote of the stockholders. A director elected to fill a vacancy caused by
resignation, death or removal shall be elected to hold office for the unexpired
term of his predecessor.
9. REMOVAL OF DIRECTORS.
Any or all of the directors may be removed for cause by vote of the
stockholders or by action of the board. Directors may be removed without cause
only by vote of the stockholders.
10. RESIGNATION.
A director may resign at any time by giving written notice to the board,
the president or the secretary of the corporation. Unless otherwise specified in
the notice, the resignation shall take effect upon receipt thereof by the board
or such officer, and the acceptance of the resignation shall not be necessary to
make it effective.
11. COMPENSATION.
No compensation shall be paid to directors, as such, for their services,
but by resolution of the board a fixed sum and expenses for actual attendance at
each regular or special meeting of the board may be authorized. Nothing herein
contained shall be construed to preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.
By-Laws 6
<PAGE>
12. PRESUMPTION OF ASSENT.
A director of the corporation who is present at a meeting of the directors
at which action on any corporate matter is taken shall be presumed to have
assented to the action taken unless his dissent shall be entered in the minutes
of the meeting or unless he shall file his written dissent to such action with
the person acting as the secretary of the meeting before the adjournment thereof
or shall forward such dissent by registered mail to the secretary of the
corporation immediately after the adjournment of the meeting. Such right to
dissent shall not apply to a director who voted in favor of such action.
13. EXECUTIVE AND OTHER COMMITTEES.
The board, by resolution, may designate from among its members an
executive committee and other committees, each consisting of three or more
directors. Each such committee shall serve at the pleasure of the board.
14. INFORMAL ACTION BY DIRECTORS.
Unless otherwise provided by law, any action required to be taken at a
meeting of the directors, or any other action which may be taken at a meeting of
the directors, may be taken without a meeting if a consent in writing, setting
forth the action so taken, shall be signed by all the directors entitled to vote
with respect to the subject matter thereof.
By-Laws 7
<PAGE>
ARTICLE IV - OFFICERS
1. NUMBER.
The officers of the corporation shall be a president, a vice-president, a
secretary and a treasurer, each of whom shall be elected by the directors. Such
other officers and assistant officers as may be deemed necessary may be elected
or appointed by the directors.
2. ELECTION AND TERM OF OFFICE.
The officers of the corporation to be elected by the directors shall be
elected annually at the first meeting of the directors held after each annual
meeting of the stockholders. Each officer shall hold office until his successor
shall have been duly elected and shall have qualified or until his death or
until he shall resign or shall have been removed in the manner hereinafter
provided.
3. REMOVAL.
Any officer or agent elected or appointed by the directors may be removed
by the directors whenever in their judgment the best interests of the
corporation would be served thereby, but such removal shall be without prejudice
to the contract rights, if any, of the person so removed.
4. VACANCIES.
A vacancy in any office because of death, resignation, removal,
disqualification or otherwise, may be filled by the directors for the unexpired
portion of the term.
5. PRESIDENT.
The president shall be the principal executive officer of the corporation
and, subject to the control of the directors, shall in general supervise and
control all of the business and affairs of the corporation. He shall, when
present, preside at all meetings of the stockholders and of the directors. He
may sign, with the secretary or, any other proper officer of the corporation
thereunto authorized by the directors, certificates for shares of the
corporation, any deeds, mortgages, bonds, contracts, or other instruments which
the directors have authorized to be executed, except in cases where the signing
and execution thereof shall be expressly delegated by the directors or by these
by-laws to some other officer or agent of the corporation, or shall be required
by law to be otherwise signed or executed; and in general shall
By-Laws 8
<PAGE>
perform all duties incident to the office of president and such other duties as
may be prescribed by the directors from time to time.
6. VICE-PRESIDENT.
In the absence of the president or in event of his death, inability or
refusal to act, the vice-president shall perform the duties of the president,
and when so acting, shall have all the powers of and be subject to all the
restrictions upon the president. The vice-president shall perform such other
duties as from time to time may be assigned to him by the President or by the
directors.
7. SECRETARY.
The secretary shall keep the minutes of the stockholders' and of the
directors' meetings in one or more books provided for that purpose, see that all
notices are duly given in accordance with the provisions of these by-laws or as
required, be custodian of the corporate records and of the seal of the
corporation and keep a register of the post office address of each stockholder
which shall be furnished to the secretary by such stockholder, have general
charge of the stock transfer books of the corporation and in general perform all
duties incident to the office of secretary and such other duties as from time to
time may be assigned to him by the president or by the directors.
8. TREASURER.
If required by the directors, the treasurer shall give a bond for the
faithful discharge of his duties in such sum and with such surety or sureties as
the directors shall determine. He shall have charge and custody of and be
responsible for all funds and securities of the corporation; receive and give
receipts for moneys due and payable to the corporation from any source
whatsoever, and deposit all such moneys in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with these by-laws and in general perform all of the duties incident to the
office of treasurer and such other duties as from time to time may be assigned
to him by the president or by the directors.
9. SALARIES.
The salaries of the officers shall be fixed from time to time by the
directors and no officer shall be prevented from receiving such salary by reason
of the fact that he is also a director of the corporation.
By-Laws 9
<PAGE>
10. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
(a) Each director and officer, elected or appointed, shall be entitled, without
the necessity of further act or deed on the part of himself or the corporation
to be indemnified by the corporation from and against any and all claims,
liabilities, fines or penalties, whether or not reduced to judgment, imposed
upon or asserted against him by reason of his being or having been a director or
officer of the corporation or otherwise, and also from and against all costs and
expenses (including, without any limitation of the foregoing, fees and
disbursements of counsel) reasonably incurred by him as a result thereof,
whether in settlement of the same or in connection with any action, suit or
proceeding to which he is now or may hereafter become or be made a party for a
like reason; provided, however, that such indemnification shall not extend to
any instance in which
(i) any liability, fine or penalty is imposed upon him by final judgment
of a court of competent jurisdiction or the claims against him are
dismissed or barred upon the ground of any statute of limitations or
of any other technical defense not going to the merits of the claims
involved, unless the court shall find that the liability, fine or
penalty so imposed or the claims so dismissed or barred resulted
from action taken or omitted to be taken by him in good faith and
without negligence or misconduct in the performance of his duty or,
in the absence of such a finding, unless counsel selected or
approved by the board of directors shall have advised the
corporation that in the opinion of such counsel such liability, fine
or penalty or such claims resulted from action taken or omitted to
be taken by him in good faith and without negligence or misconduct
in the performance of his duty; or
(ii) any amount is paid or is to be paid by him to the corporation in or
in connection with the settlement of any action, suit, proceeding or
claim, with or without the entry of any judgment therein or in
respect thereof by a court of competent jurisdiction; or
By-Laws 9(a)
<PAGE>
(iii) any amount is paid or is to be paid by him to any party other than
the corporation in or in connection with the settlement of any
action, suit, proceeding or claim, with or without the entry of any
judgment therein or in respect thereof by a court of competent
jurisdiction, unless such court shall find that such director or
officer acted in good faith and without negligence or misconduct in
the performance of his duty, or unless, in the absence of such
finding, the corporation shall be advised by counsel selected or
approved by the board that in the opinion of such counsel such
action, suit, proceeding or claim is without substantial merit or
that such director or officer acted in good faith and without
negligence or misconduct in the performance of his duty with respect
to the matters involved therein, but in no event shall the amount of
the indemnity under this subdivision (iii) exceed the expense which
might, in the judgment of the board, reasonably be incurred by such
director of officer in conducting his defense to a final conclusion;
nor shall such indemnification extend to any costs or expenses in connection
with any case referred to in clause (i), (ii) and (iii) above.
(b) The corporation's obligation aforesaid (i) shall exist whether or not a
director or officer is or has continued to be a director or officer of the
corporation at or up to the time any costs or expenses are incurred or any
claims or liabilities arise or any settlement is effected, (ii) shall inure to
the benefit of the heirs, executors or administrators of such director or
officer, (iii) shall not be exclusive of any other rights to which he or they
may be entitled as a matter of law, and (iv) may, but need not, be evidenced by
a writing to be delivered to him in connection with his election or appointment
as such director and/or officer and in consideration of his acceptance of the
same. Notwithstanding any repeal of this Section or other amendment of these
By-Laws affecting or purporting to affect this Section or the indemnification
herein provided, such obligation shall be binding upon the corporation (subject
only to the exceptions hereinbefore set forth) as to all matters which occur
during or are allocable to the period prior to any such repeal or amendment and
shall cover all
By-Laws 9(b)
<PAGE>
claims, liabilities, costs and expenses at any time connected therewith, and
also any settlement thereof, as hereinabove stated.
(c) In determining whether and to what extent, if any, a director or officer of
the corporation is entitled to indemnification hereunder or under any writing
aforesaid and in making any payments pursuant to such determination, the board
of directors and/or each director and officer, whether or not interested in any
such determination or payment, may rely upon, and shall be protected by, an
opinion of counsel selected or approved by the board, which counsel may, but
need not, be counsel advising as above mentioned. In the selection of counsel
for any one or more of the purposes hereinabove set forth, the determination of
the board shall be final and binding, notwithstanding that one or more, or all,
of the directors taking part in such selection are or were interested in any
payment or indemnification to which claim is made hereunder.
By-Laws 9(c)
<PAGE>
ARTICLE V - CONTRACTS, LOANS, CHECKS AND DEPOSITS
1. CONTRACTS.
The directors may authorize any officer or officers, agent or agents, to
enter into any contract or execute and deliver any instrument in the name of and
on behalf of the corporation, and such authority may be general or confined to
specific instances.
2. LOANS.
No loans shall be contracted on behalf of the corporation and no evidences
of indebtedness shall be issued in its name unless authorized by a resolution of
the directors. Such authority may be general or confined to specific instances.
3. CHECKS, DRAFTS, ETC.
All checks, drafts or other orders for the payment of money, notes or
other evidences of indebtedness issued in the name of the corporation, shall be
signed by such officer or officers, agent or agents of the corporation and in
such manner as shall from time to time be determined by resolution of the
directors.
4. DEPOSITS.
All funds of the corporation not otherwise employed shall be deposited
from time to time to the credit of the corporation in such banks, trust
companies or other depositaries as the directors may select.
ARTICLE VI - CERTIFICATES FOR SHARES AND THEIR TRANSFER
1. CERTIFICATES FOR SHARES.
Certificates representing shares of the corporation shall be in such form
as shall be determined by the directors. Such certificates shall be signed by
the president and by the secretary or by such other officers authorized by law
and by the directors. All certificates for shares shall be consecutively
numbered or otherwise identified. The name and address of the stockholders, the
number of shares and date of issue, shall be entered on the stock transfer books
of the corporation. All certificates surrendered to the corporation for transfer
shall be canceled and no new certificate shall be issued until the
By-Laws 10
<PAGE>
former certificate for a like number of shares shall have been surrendered and
canceled, except that in case of a lost, destroyed or mutilated certificate a
new one may be issued therefor upon such terms and indemnity to the corporation
as the directors may prescribe.
3. TRANSFERS OF SHARES.
(a) Upon surrender to the corporation or the transfer agent of the
corporation of a certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it shall be the
duty of the corporation to issue a new certificate to the person entitled
thereto, and cancel the old certificate; every such transfer shall be entered on
the transfer book of the corporation which shall be kept at its principal
office.
(b) The corporation shall be entitled to treat the holder of record of any
share as the holder in fact thereof, and, accordingly, shall not be bound to
recognize any equitable or other claim to or interest in such share on the part
of any other person whether or not it shall have express or other notice
thereof, except as expressly provided by the laws of this state.
ARTICLE VII - FISCAL YEAR
The fiscal year of the corporation shall begin on the first day of January
in each year.
ARTICLE VIII - DIVIDENDS
The directors may from time to time declare, and the corporation may pay,
dividends on its outstanding shares in the manner and upon the terms and
conditions provided by law.
ARTICLE IX - SEAL
The directors shall provide a corporate seal which shall be circular in
form and shall have inscribed thereon the name of the corporation, the state of
incorporation, year of incorporation and the words, "Corporate Seal".
By-Laws 11
<PAGE>
ARTICLE X - WAIVER OF NOTICE
Unless otherwise provided by law, whenever any notice is required to be
given to any stockholder or director of the corporation under the provisions of
these by-laws or under the provisions of the articles of incorporation, a waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent to
the giving of such notice.
ARTICLE XI - AMENDMENTS
These by-laws may be altered, amended or repealed and new by-laws may be
adopted by a vote of the stockholders representing a majority of all the shares
issued and outstanding, at any annual stockholders' meeting or at any special
stockholders' meeting when the proposed amendment has been set out in the notice
of such meeting.
These by-laws may also be altered, amended or repealed and new by-laws may
be adopted by a vote of the majority of the directors at either an annual
meeting, a special meeting, or by consent as provided in Article III, Section 14
hereof.
By-Laws 12
<PAGE>
Exhibit 3.15
State of Delaware
PAGE 1
Office of the Secretary of State
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THE ATTACHED ARE TRUE AND CORRECT COPIES OF ALL DOCUMENTS ON FILE OF
"RELOCATION MANAGEMENT SYSTEMS, INC." AS RECEIVED AND FILED IN THIS OFFICE.
THE FOLLOWING DOCUMENTS HAVE BEEN CERTIFIED:
CERTIFICATE OF INCORPORATION, FILED THE TWENTY-FOURTH DAY OF APRIL, A.D.
1985, AT 10 O'CLOCK A.M.
[SEAL]
/s/ Edward J. Freel
----------------------------------------
Edward J. Freel, Secretary of State
2060254 8100H AUTHENTICATION: 0056845
991461086 DATE: 11-01-99
<PAGE>
FILED
APR 24 1985 10AM
/s/ [ILLEGIBLE]
SECRETARY OF STATE
CERTIFICATE OF INCORPORATION
OF
RELOCATION MANAGEMENT SYSTEMS, INC.
* * * * *
1. The name at the corporation is
RELOCATION MANAGEMENT SYSTEMS, INC.
2. The address of its registered office in the State of Delaware is
Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County
of New Castle. The name of its registered agent at such address is The
Corporation Trust Company.
3. The nature of the business or purposes to be conducted or
promoted is:
To develop and market general business systems, applications,
hardware and software.
To engage in any lawful act or activity for which corporations may
be organized under the General Corporation Law of Delaware.
4. The total number of shares of stock which the corporation shall
have authority to issue is One Thousand (1,000) and the par value of each of
such shares is One Dollar ($1.00) amounting in the aggregate to One Thousand
Dollars ($1,000.00).
The designations and the powers, preferences and rights, and the
qualifications, limitations or restrictions thereof are as follows:
<PAGE>
Unless expressly conferred by the terms of this Certificate of
Incorporation, as amended from time to time, or by the terms of a valid
agreement to which the Corporation is a party, or by the terms of the securities
issued by the Corporation, no holder of stock, or of rights or options to
purchase stock, or of other securities or obligations of the Corporation of any
class convertible into stock, of the Corporation of any class shall, as such,
have any preemptive or preferential right of subscription to any shares of
stock, or rights or options to purchase stock, of the corporation of any class,
whether now or hereafter authorized, or to any obligations convertible into
stock, or into rights or options to purchase stock, of the Corporation
(including any notes, bonds or other evidences of indebtedness to which are
attached any stock of the Corporation) issued or sold or any right of
subscription to any thereof other than such, if any, as the Board of Directors
in its discretion may from time time fix pursuant to the authority conferred by
this Certificate of incorporation. Shares of stock rights or options to purchase
stock, or obligations convertible into stock or into rights or options to
purchase stock, of the Corporation, may from time to time be issued and sold to
such parties, whether stockholders or others (and if issued and sold to any one
or more stockholders, then they may be so sold without reference to any other
holder or holders of shares of the same or any different class of stock and
without reference to whether such stockholders are holders of stock having
limited or unlimited dividend or voting rights), all as the Board of Directors
in its sole discretion may determine.
<PAGE>
5A. The name and mailing address of each incorporator is as follows:
NAME MAILING ADDRESS
---- ---------------
W.J. Reif Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
V.A. Brookens Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
J.L. Austin Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
5B. The name and mailing address of each person, who is to serve as
a director until the first annual meeting of the stockholders or until a
successor is elected and qualified, is as follows:
NAME MAILING ADDRESS
---- ---------------
Kenneth W. Maxfield P.0. Box 988
Fort Wayne, Indiana 46801
Martin A. Weissert P.0. Box 988
Fort Wayne, Indiana 46801
James L. Longbons P.0. Box 988
Fort Wayne, Indiana 46801
6. The corporation is to have perpetual existence.
7. In furtherance and not in limitation of the powers conferred by
statute, the board of directors is expressly authorized:
To make, alter or repeal the by-laws of the corporation.
To authorize and cause to be executed mortgages and liens upon the
real and personal property of the corporation.
<PAGE>
To set apart out of any of the funds of the corporation available
for dividends a reserve or reserves for any proper purpose and to abolish any
such reserve in the manner in which it was created.
By a majority of the whole board, to designate one or more
committees, each committee to consist of one or more of the directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. The by-laws may provide that in the absence or
disqualification of a member of a committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he or
they constitute a quorum, may unanimously appoint another member of the board of
directors to act at the meeting in the place of any such absent or disqualified
member. Any such committee, to the extent provided in the resolution of the
board of directors, or in the by-laws of the corporation, shall have and may
exercise all the powers and authority of the board of directors in the
management of the business and affairs of the corporation, and may authorize the
seal of the corporation to be affixed to all papers which may require it; but no
such committee shall have the power or authority in reference to amending the
certificate of incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the corporation's property and assets, recommending to the
stockholders a dissolution of the corporation or a revocation of a dissolution,
or amending the by-laws of the corporation; and, unless the resolution or
by-law, expressly so provide, no
<PAGE>
such committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock.
When and as authorized by the stockholders in accordance with
statute, to sell, lease or exchange all or substantially all of the property and
assets of the corporation, including its good will and its corporate franchises,
upon such terms and conditions and for such consideration, which may consist in
whole or in part of money or property including shares of stock in, and/or other
securities of, any other corporation or corporations, as its board of directors
shall deem expedient and for the best interests of the corporation.
8. Elections of directors need not be by written ballot unless the
by-laws of the corporation shall so provide.
Meetings of stockholders may be held within or without the State of
Delaware, as the by-laws may provide. The books of the corporation may be kept
(subject to any provision contained in the statutes) outside the State of
Delaware at such place or places as may be designated from time to time by the
board of directors or in the by-laws of the corporation.
9. The following provisions are inserted for the management of the
business and for the conduct of the affairs of the Corporation and for defining
and regulating the powers of the Corporation and its directors and stockholders
and are in furtherance and not in limitation of the powers conferred upon the
corporation by statute:
(a) The by-laws of the Corporation may fix and alter, or
provide the manner for
<PAGE>
fixing and altering, the number of directors constituting the whole
Board, provided that such number shall always be not less than
three. In case of any increase in the number of directors
constituting the whole Board, the additional directors shall be
chosen by the directors or by the stockholders at the time having
voting power, as may be prescribed in said by-laws. Directors need
not be stockholders of the Corporation, and Directors chosen by the
incorporators or the stockholders, or chosen by majority of the
remaining directors to fill vacancies in the Board of Directors,
including vacancies resulting from an increase in the number of
directors constituting the whole Board, need not be chosen by
ballot.
(b) The Board of Directors may by resolution or resolutions,
passed by a majority of the whole Board, designate one or more
committees, each committee to consist of two or more of the
directors of the Corporation, which, to the extent provided in said
resolution or resolutions or in the by-laws of the Corporation,
shall have and may exercise the powers of the Board in the
management of the business and affairs of the Corporation and may
have power to authorize the seal of the Corporation to be affixed to
all papers which may require it. Such committee or committees shall
have such name or names as may be stated in said by-laws or
<PAGE>
as may be determined from time to time by resolution adopted by the
Board.
(c) Except as otherwise provided in the by-laws, the Board of
Directors may from time to time by resolution or resolutions adopted
by a majority of the whole Board
(1) fix the fees, salaries or other compensation or
amounts to be paid to the members of any committee designated
pursuant to paragraph (b) above; and
(2) authorize the payment of fees for attendance at
meetings of the Board and all salaries or other compensation
or amounts to all or any of the members of the Board, as such,
in such amount or amounts, and payable in a lump sum or in
such installments and at such times as the Board shall
determine as aforesaid, which salaries or other compensation
or amounts may be in addition to any amounts payable to such
member or members for attendance at meetings of the Board, and
in addition to any fees, salaries or other compensation or
amounts which may be paid or payable to such member or members
as a member of any committee or as an officer of the
Corporation, or in any other capacity; and anything in
paragraph (d) below in, or in any other provision of, this
article to the contrary notwithstanding, any resolution
adopted by a majority of the whole Board
<PAGE>
as aforesaid shall be valid for all purposes whether or not
any one or more directors affected, or intended to be affected
thereby, may be included in such majority or vote or may vote
for such resolution or may be a member of any such committee
or may receive any such fees, salaries, compensation or other
amounts and whether or not the presence of such director or
directors at any meeting at which such resolution is so passed
is or was necessary to constitute a quorum thereat.
(d) The Board of Directors shall have the power and authority:
(1) to make, alter or repeal, or to adopt new, by-laws
of the Corporation, except as otherwise provided in a by-law
adopted by the stockholders entitled to vote; but by-laws so
made, altered or adopted by the directors may be altered or
repealed by such stockholders;
(2) to the full extent permitted or not prohibited by
law, to determine the use and disposition of any surplus or
net profits:
(3) from time to time to set apart out of any assets of
the Corporation otherwise available for dividends a reserve or
reserves as working capital or for any other proper purpose of
purposes, and to reduce, abolish or add to any such
<PAGE>
reserve or reserves from time to time as said Board may deem
to be in the interests of the Corporation; and the board shall
likewise have power to determine in its discretion what part
of the assets of the Corporation available for dividends in
excess of such reserve or reserves shall be declared in
dividends and paid to the stockholders of the corporation;
(4) from time to time determine to what extent and at
what times and places and under what conditions and
regulations the accounts, books and records of the
Corporation, or any of them, shall be open to the inspection
of the stockholders; and no stockholder shall have any right
to inspect any account or book or document of the Corporation,
except as conferred by the laws of the State of Delaware,
unless and until authorized so to do by resolution of the
Board or of the stockholders of the Corporation;
(5) from time to time to fix the compensation or
additional compensation or other remuneration to be paid to
any of the directors, officers, agents or employees (including
directors and officers of the Corporation or of any entities
in which or in the welfare of which the corporation has an
interest, and those actively engaged in the conduct of the
Corporation's business or the
<PAGE>
business of its subsidiary or affiliated entities) for
services rendered, or to be rendered, and to adopt any plan or
other arrangement that it may deem advisable for determing the
amounts of such compensation, additional compensation or other
remuneration, including, without limiting the generality of
the foregoing, any plan or arrangement under which all or a
part of the amounts so payable may be dependent upon the
amount of the gross or net income, earnings or profits
(consolidated or otherwise) of the Corporation, and/or any one
or more of its subsidiaries or affiliates, upon such terms and
conditions and the Board may fix;
(6) to the full extent permitted or not prohibited by
law, and without the consent of or other action by the
stockholders, to authorize or create mortgages, pledges or
other liens or encumbrances upon any or all of the assets,
real, personal or mixed, and franchises of the Corporation,
including after-acquired property, and to exercise all of the
powers of the Corporation in connection therewith; and
(7) in addition to the power and authority hereinbefore
and by statue conferred upon it, to exercise all such powers
and do all much acts and things as may be exercised or done by
the
<PAGE>
Corporation, subject nevertheless to the provisions of the
laws of the State of Delaware, of this Certificate and of the
by-laws of the Corporation, as the same may from time to time
be amended.
(e) Any director or officer may be removed at any time, with
or without cause, by the affirmative vote, at any stockholders'
meeting, of the holders of a majority of the outstanding stock of
the Corporation entitled to vote thereat, or by such other vote and
in such other manner, with or without any stockholders' meeting, as
may be provided in the by-laws of the Corporation.
(f) Whenever a compromise or arrangement is proposed between
this Corporation and its creditors or any class of them and/or
between this Corporation and its stockholders or any class of them,
any court or equitable jurisdiction within the State of Delaware
may, on the application in a summary way of this Corporation or of
any creditor or stockholder thereof, or on the application of any
receiver or receivers appointed for this Corporation under the
provisions of section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or
receivers appointed for this Corporation under the provisions of
section 279 of Title 8 of the Delaware Code order a meeting of the
creditors or class of creditors, and/or of the stockholders or
class of
<PAGE>
stockholders of this Corporation, as the case may be, to be summoned
in such manner as the said court directs. If a majority in number
representing three-fourths in value of the creditors or class of
creditors, and/or of the stockholders or class of stockholders of
this Corporation, as the case may be, agree to any compromise or
arrangement and to any reorganization of this Corporation as a
consequence of such compromise or arrangement, the said compromise
or arrangement and the said reorganization shall, if sanctioned by
the court to which the said application has been made, be binding on
all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of this Corporation, as the
case may be, and also on this Corporation.
(g) At every meeting of the stockholders of the Corporation,
each stockholder entitled to vote thereat may cast one vote in
person or by proxy for each share of stock held by such stockholder.
(h) When and as authorized by the affirmative vote of the
holders of a majority of the stock issued and outstanding having
voting power given at a stockholders' meeting duly called for that
purpose, or at the next annual meeting of the stockholders, provided
the notice of the said annual meeting contains a notice of the
proposed sale, lease or exchange or when authorized by the written
<PAGE>
consent of the holders of a majority of the voting stock issued and
outstanding, the Board of directors shall have power and authority
to sell, lease or exchange all of the property and assets of the
Corporation, including its good will and its corporate franchises,
upon such terms and conditions and for such consideration, which may
be in whole or in part shares of stock in, and/or other securities
of, any other corporation or corporations, as the Board of Directors
shall deem expedient and for the best interests of the Corporation.
(i) A director of the Corporation shall not, in the absence of
fraud, be disqualified by his office from dealing or contracting
with the corporation either as a vendor, purchaser or otherwise,
nor, in the absence of fraud, shall any transaction or contract of
the Corporation be void or voidable or affected by reason of the
fact that any director, or any firm of which any director is a
member, or any corporation of which any director is an officer,
director or stockholder, is in any way interested in such
transaction or contract; provided that at the meeting of the Board
of Directors or of a committee thereof having authority in the
premises, authorizing or confirming said contract or transaction,
the existence of an interest of such director, firm or corporation
is disclosed or is known and there
<PAGE>
shall be present a quorum of the Board or of directors constituting
such committee, and such contract or transaction shall be approved
by a majority of such quorum, which majority shall consist of
directors not so interest or connected. A general notice spread upon
the minutes of a meeting of the Board or of any committee thereof
that a director is a member of any firm or an officer, director or
stockholder of any corporation, and is to be regarded as interested
in any subsequent transaction with such firm or corporation, shall
be a sufficient disclosure under the foregoing provision, and after
such general notice it shall not be necessary to give any special
notice relating to any practical transaction with such firm or
corporation. Nor shall any director, nor any firm of which any
director is a member, nor any corporation of which any director is
an officer, director of stockholder, be liable to account to the
Corporation for any profit realized from or through any such
transaction or contract of the corporation authorized, confirmed or
approved as aforesaid by reason of the fact that such director or
any firm of which he is a member, or any corporation of which he is
a stockholder, director or officer, was interested in such
transaction or contract. Directors so interested may be counted when
present at meetings of the Board of Directors
<PAGE>
or of such committee for the purpose of determing the existence of a
quorum. Any contract, transaction or act of the Corporation or of
the Board of Directors or of any committee hereof (whether or not
authorized, confirmed or approved as hereinbefore provided) which
shall be ratified by a majority in interest of the holders of the
capital stock entitled to vote, at any annual meeting, or any
special meeting called for such purpose, shall be as valid and as
binding as though ratified by every stockholder of the Corporation.
Any director of the Corporation may be counted in determining the
existence of a quorum at a meeting to consider any contract or
transaction between the Corporation and any subsidiary, parent or
other affiliated corporation of which he is also a director or
officer and may vote upon any such contract or transaction, which
shall not be invalid or otherwise affected by reason of his presence
or his vote.
(j) Except as otherwise provided in the by-laws, the
stockholders of the Corporation and the Board of Directors or any
committee thereof may hold their meetings and have an office or
offices outside of the State of Delaware, and, subject to the
provisions of the laws of said state, may keep the books of the
Corporation outside of said State at such places as may, from time
to time, be designated by the Board of Directors.
<PAGE>
(k) Nothing contained in this Certificate shall be deemed to
prohibit or restrict in any way the taking of any action by the
Board of Directors of the Corporation or any committee of the Board
without a meeting, pursuant to written consent, as and to the extent
permitted by the General Corporation Law of the State of Delaware,
as from time to time amended.
(1) The by-laws may contain provisions, in addition to those
herein set forth, relating to the management of the business of the
Corporation and the conduct of its affairs and further defining,
limiting and regulating the powers of the directors and of the
stockholders.
10. The Corporation reserves the right to amend the provision
contained in this Certificate an in any certificate amendatory hereof in the
manner now or hereafter prescribed by law, and all rights conferred on
stockholders or other hereunder or thereunder are granted subject to such
reservations.
WE, THE UNDERSIGNED, being each of the incorporators hereinbefore
named, for the purpose of forming a corporation pursuant to the General
Corporation Law of the State of Delaware, do make this certificate, hereby
declaring and certifying that this is our act and deed and the facts herein
stated are true, and accordingly have hereunto set our hands this 24th day of
April, 1985
/s/ W.J. Reif
-----------------
W.J. Reif
/s/ V.A. Brookens
-----------------
V.A. Brookens
/s/ J.L. Austin
-----------------
J.L. Austin
<PAGE>
BY - LAWS
of
RELOCATION MANAGEMENT SYSTEMS, INC.
ARTICLE I - OFFICES
SECTION I. REGISTERED OFFICE. --The registered office shall be established
and maintained at 1209 Orange Street, City of Wilmington
in the County of New Castle in the State of Delaware.
SECTION 2. OTHER OFFICES. --The corporation may have other offices, either
within or without the State of Delaware, at such place or places as the Board of
Directors may from time to time appoint or the business of the corporation may
require.
ARTICLE II - MEETING OF STOCKHOLDERS
SECTION I. ANNUAL MEETINGS. --Annual meetings of stockholders for the
election of directors and for such other business as may be stated in the notice
of the meeting, shall be held at such place, either within or without the State
of Delaware, and at such time and date as the Board of Directors, by resolution,
shall determine and as set forth in the notice of the meeting. In the event the
Board of Directors fails to so determine the time, date and place of meeting,
the annual meeting of shockholders shall be held at the registered office of the
corporation in Delaware on
If the date of the annual meeting shall fall upon a legal holiday, the
meeting shall be held on the next succeeding business day. At each annual
meeting, the stockholders entitled to vote shall elect a Board of Directors and
may transact such other corporate business as shall be stated in the notice of
the meeting.
bl 1
<PAGE>
SECTION 2. OTHER MEETINGS. -- Meetings of stockholders for any purpose
other than the election of directors may be held at such time and place, within
or without the State of Delaware, as shall be stated in the notice of the
meeting.
SECTION 3. VOTING. -- Each stockholder entitled to vote in accordance with
the terms and provisions of the Certificate of Incorporation and these By-Laws
shall be entitled to one vote, in person or by proxy, for each share of stock
entitled to vote held by such stockholder, but no proxy shall be voted after
three years from its date unless such proxy provides for a longer period. Upon
the demand of any stockholder, the vote for directors and upon any question
before the meeting shall be by ballot. All elections for directors shall be
decided by plurality vote; all other questions shall be decided by majority vote
except as otherwise provided by the Certificate of Incorporation or the laws of
the State of Delaware.
SECTION 4. STOCKHOLDER LIST. -- The officer who has charge of the stock
ledger of the corporation shall at least 10 days before each meeting of
stockholders prepare a complete alphabetical addressed list of the stockholders
entitled to vote at the ensuing election, with the number of shares held by
each. Said list shall be open to the examination of any stockholder, for any
purpose germane to the meeting, during ordinary business hours, for a period of
at least ten days prior to the meeting, either at a place within the city where
the meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not so specified, at the place where the meeting is to be held.
The list shall be available for inspection at the meeting.
SECTION 5. QUORUM. --Except as otherwise required by law, by the
Certificate of Incorporation or by these By-Laws, the presence, in person or by
proxy, of stockholders holding a majority of the stock of the corporation
entitled to vote shall constitute a quorum at all meetings of the stockholders.
In case a quorum shall not be present at any meeting, a majority in interest of
the stockholders entitled to vote thereat, present in person or by proxy, shall
have power to adjourn the meeting from time to time, without notice other than
announcement at the meeting, until the requisite amount of stock entitled to
vote shall be present. At any such adjourned meeting at which the requisite
amount of stock entitled to vote shall be represented, any business may be
transacted which might have been transacted at the meeting as originally
noticed; but only those stockholders entitled to vote at the meeting as
originally noticed shall be entitled to vote at any adjournment or adjournments
thereof.
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<PAGE>
SECTION 6. SPECIAL MEETINGS. --Special meetings of the stockholders, for
any purpose, unless otherwise prescribed by statute or by the Certificate of
Incorporation, may be called by the president and shall be called by the
president or secretary at the request in writing of a majority of the directors
or stockholders entitled to vote. Such request shall state the purpose of the
proposed meeting.
SECTION 7. NOTICE OF MEETINGS. -- Written notice, stating the place, date
and time of the meeting, and the general nature of the business to be
considered, shall be given to each stockholder entitled to vote thereat at his
address as it appears on the records of the corporation, not less than ten nor
more than fifty days before the date of the meeting.
SECTION 8. BUSINESS TRANSACTED --No business other than that stated in the
notice shall be transacted at any meeting without the unanimous consent of all
the stockholders entitled to vote thereat.
SECTION 9. ACTION WITHOUT MEETING. --Except as otherwise provided by the
Certificate of Incorporation, whenever the vote of stockholders at a meeting
thereof is required or permitted to be taken in connection with any corporate
action by any provisions of the statutes or the Certificate of Incorporation or
of these By-Laws, the meeting and vote of stockholders may be dispensed with, if
all the stockholders who would have been entitled by vote upon the action if
such meeting were held, shall consent in writing to such corporate action being
taken.
ARTICLE III - DIRECTORS
SECTION I. NUMBER AND TERM. --The number of directors shall be three (3)
The directors shall be elected at the annual meeting of the stockholders and
each director shall be elected to serve until his successor shall be elected and
shall qualify. The number of directors may not be less than three except that
where all the shares of the corporation are owned beneficially and of record by
either one or two stockholders, the number of directors may be less than three
but not less than the number of stockholders.
bl 3
<PAGE>
SECTION 2. RESIGNATIONS. --Any director, member of a committee or other
officer may resign at any time. Such resignation shall be made in writing, and
shall take effect at the time specified therein, and if no time be specified, at
the time of its receipt by the President or Secretary. The acceptance of a
resignation shall not be necessary to make it effective.
SECTION 3 VACANCIES. --If the office of any director, member of a
committee or other officer becomes vacant, the remaining directors in office,
though less than a quorum by a majority vote, may appoint any qualified person
to fill such vacancy, who shall hold office for the unexpired term and until his
successor shall be duly chosen.
SECTION 4. REMOVAL. --- Any director or directors may be removed either
for or without cause at any time by the affirmative vote of the holders of a
majority of all the shares of stock outstanding and entitled to vote, at a
special meeting of the stockholders called for the purpose and the vacancies
thus created may be filled, at the meeting held for the purpose of removal, by
the affirmative vote of a majority in interest of the stockholders entitled to
vote.
SECTION 5. INCREASE OF NUMBER. -- The number of directors may be increased
by amendment of these By-Laws by the affirmative vote of a majority of the
directors, though less than a quorum, or, by the affirmative vote of a majority
in interest of the stockholders, at the annual meeting or at a special meeting
called for that purpose, and by like vote the additional directors may be chosen
at such meeting to hold office until the next annual election and until their
successors are elected and qualify.
SECTION 6. COMPENSATION. -- Directors shall not receive any stated salary
for their services as directors or as members of committees, but by resolution
of the board a fixed fee and expenses of attendance may be allowed for
attendance at each meeting. Nothing herein contained shall be construed to
preclude any director from serving the corporation in any other capacity as an
officer, agent or otherwise, and receiving compensation therefor.
bl 4
<PAGE>
SECTION 7. ACTION WITHOUT MEETING. --Any action required or permitted to
be taken at any meeting of the Board of Directors, or of any committee thereof,
may be taken with out a meeting, if prior to such action a written consent
thereto is signed by all members of the board, or of such committee as the case
may be, and such written consent is filed with the minutes of proceedings of the
board or committee.
ARTICLE IV - OFFICERS
SECTION I. OFFICERS. -- The officers of the corporation shall consist of a
President, a Treasurer, and a Secretary, and shall be elected by the Board of
Directors and shall hold office until their successors are elected and
qualified. In addition, the Board of Directors may elect a Chairman, one or more
Vice-Presidents and such Assistant Secretaries and Assistant Treasurers as it
may deem proper. None of the officers of the corporation need be directors. The
officers shall be elected at the first meeting of the Board of Directors after
each annual meeting. More than two offices may be held by the same person.
SECTION 2. OTHER OFFICERS AND AGENTS. -- The Board of Directors may
appoint such officers and agents as it may deem advisable, who shall hold their
offices for such terms and shall exercise such power and perform such duties as
shall be determined from time to time by the Board of Directors.
SECTION 3. CHAIRMAN. -- The Chairman of the Board of Directors if one be
elected, shall preside at all meetings of the Board of Directors and he shall
have and perform such other duties as from time to time may be assigned to him
by the Board of Directors.
SECTION 4. PRESIDENT. -- The President shall be the chief executive
officer of the corporation and shall have the general powers and duties of
supervision and management usually vested in the office of President of a
corporation. He shall preside at all meetings of the stockholders if present
thereat, and in the absence or non-election of the Chairman of the Board of
Directors, at all meetings of the Board of Directors, and shall have general
supervision, direction and control of the business of the corporation Except as
the Board of Directors shall authorize the execution thereof in some other
manner, he shall excecute bonds, mortgages, and other contracts in behalf of the
corporation, and shall cause the seal to be affixed to any instrument requiring
it and when so affixed the seal shall be attested by the signature of the
Secretary or the Treasurer or an Assistant Secretary or an Assistant Treasurer.
bl 5
<PAGE>
SECTION 5. VICE-PRESIDENT. --Each Vice-President shall have such powers
and shall perform such duties as shall be assigned to him by the directors.
SECTION 6. TREASURER. --The Treasurer shall have the custody of the
corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositories as may be designated by the Board of Directors.
The Treasurer shall disburse the funds of the corporation as may be
ordered by the Board of Directors, or the President, taking proper vouchers for
such disbursements. He shall render to the President and Board of Directors at
the regular meetings of the Board of Directors, or whenever they may request it,
an account of all his transactions as Treasurer and of the financial condition
of the corporation. If required by the Board of Directors, he shall give the
corporation a bond for the faithful discharge of his duties in such amount and
with such surety as the board shall prescribe.
SECTION 7. SECRETARY. --The Secretary shall give, or cause to be given,
notice of all meetings of stockholders and directors, and all other notices
required by law or by these By-Laws, and in case of his absence or refusal or
neglect so to do, any such notice may be given by any person thereunto directed
by the President, or by the directors, or stockholders, upon whose requisition
the meeting is called as provided in these By-Laws. He shall record all the
proceedings of the meetings of the corporation and of directors in a book to be
kept for that purpose. He shall keep in safe custody the seal of the
corporation, and when authorized by the Board of Directors, affix the same to
any instrument requiring it, and when so affixed, it shall be attested by his
signature or by the signature of any assistant secretary.
SECTION 8. ASSISTANT TREASURERS & ASSISTANT SECRETARIES Assistant
Treasurers and Assistant Secretaries, if any, shall be elected and shall have
such powers and shall perform such duties as shall be assigned to them,
respectively, by the directors.
bl 6
<PAGE>
ARTICLE V
SECTION I CERTIFICATES OF STOCK. --Every holder of stock in the
corporation shall be entitled to have a certificate, signed by, or in the name
of the corporation by, the chairman or vice-chairman of the board of directors,
or the president or a vice-president and the treasurer or an assistant
treasurer, or the secretary of the corporation, certifying the number of shares
owned by him in the corporation. If the corporation shall be authorized to issue
more than one class of stock or more than one series of any class, the
designations, preferences and relative, participating, optional or other special
rights of each class of stock or series thereof and the qualifications,
limitations, or restrictions of such preferences and/or rights shall be set
forth in full or summarized on the face or back of the certificate which the
corporation shall issue to represent such class of series of stock, provided
that, except as other wise provided in section 202 of the General Corporation
Law of Delaware, in lieu of the foregoing requirements, there may be set forth
on the face or back of the certificate which the corporation shall issue to
represent such class or series of stock, a statement that the corporation will
furnish without charge to each stockholder who so requests the powers,
designations, preferences and relative, participating, optional or other special
rights of each class of stock or series thereof and the qualifications,
limitations or restrictions of such preferences and/or rights. Where a
certificate is countersigned (1) by a transfer agent other than the corporation
or its employee, or (2) by a registrar other than the corporation or its
employee, the signatures of such officers may be facsimiles.
SECTION 2. LOST CERTIFICATES --New certificates of stock may be issued in
the place of any certificate therefore issued by the corporation, alleged to
have been lost or destroyed, and the directors may, in their discretion, require
the owner of the lost or destroyed certificate or his legal representatives, to
give the corporation a bond, in such sum as they may direct, not exceeding
double the value of the stock, to indemnify the corporation against it on
account of the alleged loss of any such new certificate.
bl 7
<PAGE>
SECTION 3. TRANSFER OF SHARES. -- The shares of stock of the corporation
shall be transferable only upon its books by the holders thereof in person or by
their duly authorized attorneys or legal representatives, and upon such transfer
the old certificates shall be surrendered to the corporation by the delivery
thereof to the person in charge of the stock and transfer books and ledgers, or
to such other persons as the directors may designate, by who they shall be
cancelled, and new certificates shall thereupon be issued. A record shall be
made of each transfer and whenever a transfer shall be made for collateral
security, and not absolutely, it shall be so expressed in the entry of the
transfer.
SECTION 4. STOCKHOLDERS RECORD DATE. -- In order that the corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or to express consent to corporate
action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than sixty nor less than ten
days before the day of such meeting, nor more than sixty days prior to any other
action. A determination of stockholders of record entitled to notice of or to
vote at a meeting of stockholders shall apply to any adjournment of the meeting;
provided, however, that the Board of Directors may fix a new record date for the
adjourned meeting.
SECTION 5. DIVIDENDS. -- Subject to the provisions of the Certificate of
Incorporation the Board of Directors may, out of funds legally available
therefor at any regular or special meeting, declare dividends upon the capital
stock of the corporation as and when they deem expedient. Before declaring any
dividends there may be set apart out of any funds of the corporation available
for dividends, such sum or sums as the directors from time to time in their
discretion deem proper working capital or as a reserve fund to meet
contingencies or for equalizing dividends or for such other purposes as the
directors shall deem conducive to the interests of the corporation.
SECTION 6. SEAL. -- The corporate seal shall be circular in form and shall
contain the name of the corporation, the year of its creation and the words
"CORPORATE SEAL DELAWARE." Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or otherwise reproduced.
bl 8
<PAGE>
SECTION 7. FISCAL YEAR. -- The fiscal year of the corporation shall be
determined by resolution of the Board of Directors.
SECTION 8. CHECKS -- All checks, drafts, or other orders for the payment
of money, notes or other evidences of indebtedness issued in the name of the
corporation shall be signed by the officer or officers, agent or agents of the
corporation, and in such manner as shall be determined from time to time by
resolution of the Board of Directors.
SECTION 9. NOTICE AND WAIVER OF NOTICE - - Whenever any notice is required
by these By-Laws to be given, personal notice is not meant unless expressly
stated, and any notice so required shall be deemed to be sufficient if given by
depositing the same in the United States mail, postage prepaid, addressed to the
person entitled thereto at his address as it appears on the records of the
corporation, and such notice shall be deemed to have been given on the day of
such mailing. Stockholders not entitled to vote shall not be entitled to receive
notice of any meetings except as otherwise provided by statute.
Whenever any notice whatever is required to be given under the provisions
of any law, or under the provisions of the Certificate of Incorporation of the
corporation or these By-Laws, a waiver thereof in writing signed by the person
or persons entitled to said notice, whether before or after the time stated
therein, shall be deemed proper notice.
ARTICLE VI - CLOSE CORPORATIONS: MANAGEMENT BY SHAREHOLDERS
If the certificate of incorporation of the corporation states that the
business and affairs of the corporation shall be managed by the shareholders of
the corporation rather than by a board of directors, then, whenever the context
so requires the shareholders of the corporation shall be deemed the directors of
the corporation for purposes of applying any provision of these by-laws.
ARTICLE VII - AMENDMENTS
These By-Laws may be altered and repealed and By-Laws may be made at any
annual meeting of the stockholders or at any special meeting thereof if notice
thereof is contained in the notice of such special meeting by the affirmative
vote of a majority of the stock issued and outstanding or entitled to vote
thereat, or by the regular meeting of the Board of Directors, at any regular
meeting of the Board of Directors, or at any special meeting of the Board of
Directors, if notice thereof is contained in the notice of such special meeting.
bl 9
<PAGE>
Exhibit 3.17
================================================================================
[GRAPHIC OMITTED]
State of California
[Seal of the State of California]
[Seal of the Secretary of State]
SECRETARY OF STATE
I, BILL JONES, Secretary of State of the State of California, hereby
certify:
That the attached transcript of 8 page(s) was prepared by and in this
office from the record on file, of which it purports to be a copy, and that it
is full, true and correct.
IN WITNESS WHEREOF, I execute
this certificate and affix the
Great Seal of the State of
California this day of
[ILLEGIBLE]
------------------------------
[Seal of the State of California] /s/ Bill Jones
Secretary of State
================================================================================
<PAGE>
FILED
in the office of the Secretary of State
of the State of California
OCT 26, 1960
[ILLEGIBLE], Secretary of State
By /s/ [ILLEGIBLE]
Deputy
ARTICLES OF INCORPORATION OF
NACAL, INC.
-----------
Know all men by these presents, that we, the undersigned, have this day
voluntarily associated ourselves together for the purpose of forming a
corporation under the laws of the State of California; and we hereby certify:
Article I - Paragraph 1 - The name of said corporation shall be NACAL,
Inc.
Article II - Paragraph I - The period during which said corporation shall
continue is perpetual.
Article III - Paragraph 1 - The specific business in which said
corporation is primarily to engage is the transportation of property within the
limits of the State of California.
Paragraph 2 - In addition to the foregoing, the purpose or purposes
for which said corporation is formed are as follows:
A. To acquire, hold, lease, encumber, convey, or otherwise
dispose of real and personal property within or without the State of California,
and take real and personal property by will, gift, or bequest.
B. To act as bailee of property for hire, establishing,
maintaining, and conducting warehouses for the storage, receipt, custody,
shipment, and forwarding of personal property.
C. To maintain offices, appoint agents, and to do all other
things as are necessary, convenient, or expedient in the accomplishment of the
purposes of the organization.
D. To acquire by purchase, or otherwise, the capital shares,
bonds, and securities of this corporation or of any other corporation, domestic
or foreign, and to sell, transfer, or otherwise dispose of same, and to exercise
all rights of a shareholder with respect to any capital shares or stock which it
may hold in any other corporation.
E. To promote, establish, purchase, acquire, own, hold, deal
in, and trade in, manage, exchange, equip, operate, lease, sell, transfer,
mortgage, pledge, or otherwise encumber, and/or in any manner
<PAGE>
dispose of, lines of motor transportation by trucks and other vehicles and
conveyances propelled by motors, whether on the ground or in the air (other than
railroads), in the State of California, and to transport thereon and thereover,
for hire, intrastate, baggage, mail, express and/or freight of any and all kinds
and classes; and to acquire, own, hold, construct, repair, equip, operate,
lease, let, mortgage, pledge, or otherwise encumber, exchange, deal in and trade
in, sell or otherwise dispose of, trucks and other vehicles and conveyances of
all kinds propelled by motors, for use on land or in the air, and/or any and all
parts, materials, equipment, appliances, appurtenances, machinery, supplies,
tools, tires, fuels, oils, and/or any and all other articles and property which
are instant to or used in connection with any of the property aforesaid, or
which may be necessary, useful or convenient in carrying on any of the business
aforesaid.
F. To engage in the transportation of property in and to such
other places, other than the State of California, as any regulatory body having
jurisdiction over such business, may from time to time authorize.
G. To acquire, construct, own, hold, maintain, operate, equip,
lease, let, mortgage, pledge, exchange, sell or otherwise dispose of, such
lands, buildings, garages, repair shops, stations, offices and other real and
personal property, as may be necessary, desirable, useful or convenient, for the
purposes of this corporation, either in the State of California or elsewhere.
H. To acquire, and pay for in cash, stock or bonds of this
corporation or otherwise, the goodwill, rights, assets, and property, and to
undertake or assume the whole or any part of the obligations or liabilities of
any person, firm, association, or corporation.
I. To acquire, hold, use, sell, assign, lease, grant licenses
in respect of, mortgage or otherwise, dispose of letters patent of the United
States or any foreign country, patent rights, licenses, and privileges,
inventions, improvements and processes, copyrights, trademarks and trade names,
relating to or useful in connection with any business of this corporation.
J. To borrow money and issue bonds, debentures, notes, and
evidences of indebtedness, secure the payment or performance of its obligations
by mortgage or otherwise.
-2-
<PAGE>
K. To purchase, hold, sell and transfer the shares of its own
capital stock; provided it shall not use its funds or property for the purchase
of its own shares of capital stock, when such use would cause any impairment of
its capital, except as otherwise permitted by law, and provided further that
shares of its own capital stock belonging to it shall not be voted upon directly
or indirectly.
L. To assume any obligations, enter into any contracts, or do
any acts incidental to the transaction of its business or to the issue or sale
of its securities, or expedient for the attainment of its corporate purposes.
M. To make conations for the public welfare or for charitable,
scientific, or educational purposes.
N. To sue or be sued in any court.
O. To adopt, use, and at will alter, a corporate seal.
P. To make by-laws.
Q. To appoint such subordinate officers or agents as its
business may require, and allow them suitable compensation.
R. To qualify to do business in any other state, territory,
dependency, or foreign country and conduct business within or without the State
of California.
S. To do any other act authorized by law which is calculated,
directly or indirectly, to promote the interest of the corporation or to enhance
the value of its property.
Article IV - Paragraph 1 - The principal office for the transaction of the
business of said corporation is to be located in the County of Los Angeles,
State of California.
Article V - Paragraph 1 - The total number of shares which said
corporation shall have authority to issue is 1,000 shares, all without par
value. Such shares without nominal or par value may be issued by said
corporation from time to time for such an amount of consideration as may be
found from time to time by the Board of Directors.
Paragraphs 2 - Title to a certificate and to the shares represented
thereby can he transferred only by delivery of the certificate endorsed either
in blank or to a specified person by the person appearing by the certificate to
be the owner of the shares represented thereby.
-3-
<PAGE>
Paragraph 3 - The corporation shall be entitled to recognize the
exclusive right of a person registered on its books as the owner of shares to
receive dividends and to vote as such owner.
Paragraph 4 - All shares shall have the sane voting rights.
Article VI - Paragraph 1 - The number of directors shall be 3; and the
names and addresses of the persons who are appointed to act as the first
directors are:
A. James D. Edgett
P.0. Box 988
Fort Wayne, Indiana
B. Clyde A. Jewett
4760 Valley Boulevard
Los Angeles 32, California
C. James A. Nevil
c/o Nevil Storage Company
San Francisco, California
Paragraph 2 - The directors need not be shareholders of said
corporation. A majority of the directors at any time shall be citizens of the
United States.
Paragraph 3 - The number of directors may be changed from time to
time by the adoption of appropriate by-laws.
Article VII - Paragraph 1 - Both shareholders and directors shall have the
power to make, alter, amend, or repeal the by-laws of the corporation. Meetings
of shareholders may be held either within or without the State of California if
the by-laws so provide. The books of the corporation may be kept either within
or without the State of California, at such place or places as may be from time
to time designated by the Board of Directors.
Paragraph 2 - Th corporation reserves the right to amend, alter,
change, or repeal any provision contained in these Articles of Incorporation, in
the manner now or hereafter prescribed by statute, and all rights conferred upon
shareholders are herein granted subject to this reservation.
-4-
<PAGE>
In witness whereof, we, as incorporators and named hereinabove as
directors, have hereunto set our hands and seals as such incorporators and
directors this 23rd day of September , 1960.
/s/ James D. Edgett
-----------------------------
James D. Edgett (Seal)
/s/ Clyde A. Jewett
-----------------------------
Clyde A. Jewett (Seal)
/s/ James A. Nevil
-----------------------------
James A. Nevil (Seal)
State of Indiana)
) SS
County of Allen )
On this 23rd day of Sept., in the year 1960, before me Evelyn A. Fox a
notary public in and for said Allen County, State of Indiana, residing therein,
duly commissioned and sworn, personally appeared James D. Edgett, known to me to
be the person whose name is subscribed to the foregoing Articles of
Incorporation, as incorporator and who is also named therein as director, and
duly acknowledged to me that he executed the same.
In witness whereof, I have hereunto set my hand and affixed my official
seal at Fort Wayne, Ind. the day first above written.
/s/ Evelyn D. Fox
-----------------------------
Notary Public
EVELYN D. FOX
My commission expires Feb. 22, 1964
State of Indiana)
) SS
County of Allen )
On this 27th day of Sept., in the year 1960, before me Evelyn A. Fox a
notary public in and for said Allen County, personally appeared Clyde A. Jewett,
known to me to be the person whose name is subscribed to the foregoing Articles
of Incorporation, as incorporator and who is also named therein as director, and
duly acknowledged to me that he executed the same.
-5-
<PAGE>
In witness whereof, I have hereunto set my hand and affixed my official
seal at Fort Wayne the day first above written.
/s/ Evelyn D. Fox
-----------------------------
Notary Public
EVELYN D. FOX
My commission expires Feb. 22, 1964
State of California )
)SS
County of San Francisco )
On this [ILLEGIBLE] day of [ILLEGIBLE], in the year 1960, before me
[ILLEGIBLE] a notary public in and for said [ILLEGIBLE] County, State of
California, residing therein, duly commissioned and sworn, personally appeared
James A. Nevil, known to me to be the person whose name is subscribed to the
foregoing Articles of Incorporation, as incorporator and who is also named
therein as director, and duly acknowledged to me that he executed the same.
In witness whereof, I have hereunto set my hand and affixed my official
seal at San Francisco the day first above written.
MY COMMISSION EXPIRES AUG. 28, 1963 /s/ [ILLEGIBLE]
-----------------------------
Notary Public
NOTARY PUBLIC
[ILLEGIBLE] for the City and County of San Francisco
State of California
-6-
<PAGE>
FILED
in the office of the Secretary of State
of the State of California
JUL 9, 1968
FRANK M. JORDAN, Secretary of State
By /s/ [ILLEGIBLE]
--------------------------------
Deputy
CERTIFICATE OF AMENDMENT
OF THE ARTICLES OF INCORPORATION
OF
NACAL, INC.
-----------
STATE OF INDIANA ) ss
COUNTY OF ALLEN )
We, James D. Edgett and Evelyn D. Fox, of the City of Fort Wayne, State of
Indiana, being first duly sworn, hereby certify:
1. We are the President and Assistant Secretary-Treasurer, respectively,
of NACAL, INC.
2. That the Directors unanimously adopted the following resolution at a
special meeting held at 9:30 A.M. on June 28, 1968, at Fort Wayne,
Indiana:
"RESOLVED: That Article VI of the Articles of Incorporation of this
corporation is hereby amended to read in full as follows:
"Article VI - Paragraph 1 - The number of Directors shall be three;
and the names and addresses of the persons who are appointed to act
as the first Directors are:
A. James D. Edgett, P.O. Box 988,
Fort Wayne, Indiana
B. Clyde A. Jewett, 4760 Valley Blvd.,
Los Angeles, California
C. James A. Nevil, c/o Nevil Storage Company,
San Francisco, California
Paragraph 2 - The Directors need not be shareholders of said
corporation. A majority of the Directors at any time shall be
citizens of the United States.
Paragraph 3 - The number of Directors may be changed from time to
time by the adoption of appropriate By-Laws.
Paragraph 4 - Any action required or permitted to be taken by the
Board of Directors may be taken without a meeting, if all members of
the Board consent in writing to such action."
<PAGE>
3. That the shareholders adopted said amendment by resolution at a special
meeting held at 1:30 P.M. on June 28, 1968, at Fort Wayne, Indiana. That
the wording of the amended articles as set forth in the Shareholders'
resolution is the same as that set forth in the Directors' resolution in
Paragraph 2 of this certificate.
4. That the number of shares which so voted for the adoption of said
amendment is 501, and that the total number of shares entitled to vote on
said amendment is 501.
In witness whereof we have hereunto set our hands and affixed the seal of NACAL,
INC. this 1st day of July, 1968.
/s/ James D. Edgett
-----------------------------
James D. Edgett, President
[Seal of Nascal, Inc.]
/s/ Evelyn D. Fox
-----------------------------
Evelyn D. Fox
Assistant Secretary-Treasurer
State of Indiana )
) ss:
County of Allen )
Subscribed to and sworn before me at the City of Fort Wayne in the State
of Indiana this 1st day of July, 1968.
MARLENE DEE ZIESK /s/ Marlene Dee Ziesk
My commission expires Feb 19, 1972 -----------------------------
Notary Public
[Seal of Notary Public] [Seal of the Secretary of State]
<PAGE>
Exhibit 3.18
NACAL, INC.
BY-LAWS
-----------
Article I - OFFICES. - Paragraph 1 - The principal office shall be in
[ILLEGIBLE] Los Angeles, State of California.
Paragraph 1 - The corporation also may have [ILLEGIBLE] other
places as the Board of Directors may from time to time [ILLEGIBLE] or the
business of the corporation may require.
Article II - SHAREHOLDERS MEETINGS - Paragraph 1 - Meetings of the
shareholders may be held at such places as may be from time to time designated
by the Board of Directors and either within or without the State of California.
Paragraph 2 - An annual meeting of the shareholders shall be
held on the 1st Sat. in April in each year if not a legal holiday, and if a
legal holiday, then on the next secular day following, at 9:30 A.M., for the
election of a Board of Directors and the transaction of such other business as
may properly be brought before the meeting. When the annual meeting is not held,
or the directors are not elected thereat, a special meeting may be called and
held for that purpose.
Paragraph 3 - A written or printed notice, stating the place,
day and hour of the meeting, and in case of a special meeting, the purpose or
purposes for which the meeting is called, shall be mailed by the secretary,
assistant secretary, or by the officers or persons calling the meeting, to each
shareholder of record entitled to vote at such meeting, at such address as
appears upon the records of the corporation, at least ten days before the date
of the meeting. Notice of any shareholder meeting may be waived in writing by
any shareholder if the waiver sets forth in reasonable detail the purpose or
purposes for which the meeting is called and the time and place thereof.
Attendance at any meeting in person or by proxy, shall
<PAGE>
-2-
constitute a waiver of notice of such meeting.
Paragraph 4 - At least five days before every election of
directors, a complete list of the shareholders entitled to vote at said
election, arranged in alphabetical order, with the address and the number of
voting shares held by each, shall be prepared by the secretary, [ILLEGIBLE]
placed on file at the principal office of the corporation, subject to inspection
by any shareholder, such list shall be produced and kept open at the time and
place of election subject to the inspection of any shareholder during the
holding of such election.
Paragraph 5 - Special meetings of the shareholders may be
called by the president or first vice-president, or by the Board of Directors,
or by any shareholders holding not less than a majority of all of the shares
outstanding and entitled to vote on the business proposed to be transacted
thereat.
Paragraph 6 - Business transacted at all special meetings
shall be confined to the objects stated in the call.
Paragraph 7 - The holders of a majority of the shares issued
and outstanding and entitled by the Articles of Incorporation to vote thereat,
present in person, or represented by proxy, shall be requisite and shall
constitute a quorum that all meetings for the shareholders for the transaction
of business. If, however, such quorum shall not be present or represented at any
meeting of the shareholders, the shareholders entitled to vote thereat, present
in person or represented by proxy, shall have power to adjourn the meeting from
time to time, without notice other than announcement of the meeting, until a
quorum shall be present or represented. At such adjourned meeting at which a
quorum shall be present or represented,
<PAGE>
-3-
any business may be transacted which might have been transacted at the meeting
as originally notified.
Paragraph 8 - At any meeting of the shareholders, every
shareholder entitled by the Articles of Incorporation to vote thereat, shall be
entitled to vote in person, or by proxy executed in writing by the shareholder
or by duly authorized attorney in fact. No proxy shall be valid after eleven
months from the date of its execution, unless a longer time has expressly
provided therein, which time shall in no case exceed seven years from the date
of its execution. Each shareholder shall have one vote for each share of stock
entitled by the Articles of Incorporation to vote, registered in his name on the
books of the corporation, and except where the transfer books of the corporation
shall have been closed or a date shall have been fixed as a record date for the
determination of its shareholders entitled to vote, no share of stock shall be
voted on at any election for directors which shall have been transferred on the
books of the corporation within ten days next preceeding such election of
directors.
Article III - CONSOLIDATION FOR SHARES - Paragraph 1 - Shares of capital
stock may be sold by the corporation for such an amount of consideration as
shall from time to time be fixed by the Board of Directors.
Article IV - DIRECTORS - Paragraph 1 - The number of directors [ILLEGIBLE]
constitute the entire board shall be 13. They shall be elected at the annual
meeting of shareholders of the corporation, and each director shall be elected
to serve until his successor shall be elected and qualified; provided, however,
that the number of directors may be changed by appropriate amendment to the
by-laws.(1)
Paragraph 2 - The directors may hold their meeting and keep
the books of the corporation, except such as are required by statute to be kept
in California, outside of California, at such other places as they may from time
to time determine.
<PAGE>
-4-
Paragraph 3 - Any vacancy occurring in the Board of Directors
caused by death, resignation, increase in number of directors, or otherwise,
shall be filled by a majority vote of the remaining members of the Board, until
the next annual meeting of the shareholders.
Paragraph 4 - The business of the corporation shall be managed
by its Board of Directors which may exercise all such powers of the corporation
and to all such lawful acts and things as are not by statute or by the Articles
of Incorporation or by these By-Laws directed or required to be exercised or
done by the shareholders.
Article V - MEETINGS OF THE BOARD - Paragraph 1 - The first [ILLEGIBLE]
elected board shall follow immediately after adjournment [ILLEGIBLE]
shareholders meeting, and be held in the city or town, be it within or without
the State of California, where said shareholders meeting occurred, and no notice
of such meeting shall be necessary to the newly elected directors in order
legally to constitute the meeting provided a quorum shall be present, or they
may meet at such place and time as shall be fixed by the consent in writing of
all such directors.
Paragraph 2 - Except for the meetings described in Article V,
Paragraph 1, above, the directors shall meet upon call of the president or
executive committee, or a majority of the directors.
Paragraph 3 - At all meetings of the Board, the presence of a
majority of the whole Board of Directors shall be necessary and sufficient to
constitute a quorum for the transaction of business except the filling of
vacancies, and the act of a majority of the directors present at any meeting at
which a quorum is present, shall be the act of the Board of Directors, except as
may be otherwise specified by statute or by the Articles of Incorporation or by
these By-Laws.
<PAGE>
-5-
Article VI - EXECUTIVE COMMITTEE - Paragraph 1 - An Executive Committee
consisting of four members of the Board of Directors may be elected annually by
the Directors, which Committee shall exercise all the authority of the Board of
Directors and the management of the corporation, provided, however, that said
Executive Committee shall exercise the authority herein prescribed only during
the intervals between duly called meetings of the Directors.
Paragraph 2 - The Executive Committee shall keep a careful
record of all proceedings conducted by it, a copy of which shall be sent to each
director as soon as practicable after any meeting or meetings of said Committee,
which record shall be written into, and made a part of, the minute book of this
company.
Article VII - NOTICES - Paragraph 1 - Whenever under the provisions of the
statutes or of the Articles of Incorporation or of these By-Laws, notice is
required to be given to any director, it shall not be construed to mean personal
notice, but such notice may be given in writing by mail, by depositing the same
in a post office or letterbox, in a postpaid-sealed wraper, addressed to such
director at such address as appears on the books of the corporation, and such
notice shall be deemed to be given at the time when the same shall be thus
mailed. Whenever any notice is required to be given, a waiver thereof in
writing, signed by the person or persons entitled to said notice, whether before
or after the same stated therein shall be deemed equivalent thereto. Attendance
at any meeting of directors in person, shall constitute a waiver of notice of
such meeting.
Article VIII - OFFICERS - Paragraph 1 - The Board of Directors, at its
first meeting after each annual meeting of shareholders, shall choose from its
own number a president, a first vice-president, a secretary and a treasurer, and
said Board may, from time to time, choose additional vice-presidents,
<PAGE>
-6-
assistant secretaries, assistant treasurers, who need not be a member the Board.
Any two of the officers herein provided for, excepting the president, the first
vice-president, the secretary and treasurer, may be held by the same person.
Paragraph 2 - The Board of Directors may appoint such other
officers and agents as it shall deem necessary, who shall hold their offices for
such terms and shall have such authority and shall perform such duties as from
time to time may be determined by resolution of the Board.
Paragraph 3 - The salary of the president of the corporation
shall be fixed by the Board of Directors.
Paragraph 4 - The officers of the corporation shall hold
office until their successors are chosen and qualified for their stead. Any
officer appointed by the Board of Directors may be removed at any time by the
affirmative vote of a majority of the whole Board of Directors. If the office of
any officer becomes vacant for any reason, the vacancy shall be filled by the
Board of Directors.
Article IX - THE PRESIDENT - Paragraph 1 - The president shall be the
chief executive officer of the corporation; he shall preside at all meetings of
the shareholders and directors, shall be ex officio a member of all committees
appointed or elected by the Board of Directors, shall have general and active
management of the business of the corporation, and shall see that all orders and
resolutions of the Board are carried into effect.
Article X - VICE-PRESIDENT - Paragraph 1 - The first vice-president shall,
in the absence of disability of the president, perform the duties and exercise
the powers of the president, and shall perform such other duties as the Board of
Directors shall prescribe.
Article XI - Secretary - Paragraph 1 - The secretary shall attend all
sessions of the Board and all meetings of the shareholders and record all votes
and the minutes of all proceedings in a book to be kept for that purpose,
<PAGE>
-7-
[ILLEGIBLE] perform like duties for the Executive Committee, when [ILLEGIBLE]
give, or cause to be given, notice of all meetings of [ILLEGIBLE] and special
meetings of the Board of Directors, and shall perform such other duties as may
be prescribed by the Board of Directors or president, under whose supervision he
shall be.
Article XII - ASSISTANT SECRETARIES - Paragraph 1 - The assistant
secretaries, in order of their seniority, shall perform all the duties and
exercise all the powers of the secretary, in the absence of disability of the
secretary, and shall perform such other duties as the Board of Directors may
require.
Article XIII - TREASURER - Paragraph 1 - The treasurer shall have the
custody of the corporate's funds and securities and shall keep full and accurate
accounts of receipts and dispersements in books belonging to the corporation,
and shall deposit all monies and other valuable effects in the name and to the
credit of the corporation, in such depositories as may be designated by the
Board of Directors.
Paragraph 2 - He shall disperse the funds of the corporation
as may be ordered by the Board, taking proper vouchers for such dispersements
and shall render to the president and directors, at the regular meetings of the
Board, or whenever they may require it, an account of all his transactions as
treasurer and of the financial condition of the corporation.
Paragraph 3 - If required by the Board of Directors, he shall
give the corporation a bond, in such sum and with such surety or surities as
shall be satisfactorily to the Board of Directors for the faithful performance
of the duties of his office, and for the restoration to the corporation, in case
of his death, resignation, retirement or removal from office, of all books,
papers, vouchers, money, and other property of whatever kind in his possession
<PAGE>
-8-
or under his control belonging to the corporation.
Article XIV - ASSISTANT TREASURERS - Paragraph 1 - The assistant
treasurers, in the order of their seniority, shall perform all the duties and
exercise all the powers of the treasurer, during his absence or disability, and
they shall perform such other duties as the Board of Directors may require.
Article XV - CERTIFICATES OF STOCK - Paragraph 1 - The certificates of
stock of the corporation shall be numbered and registered as they are issued.
Every certificate shall state the name of the registered holder, the number of
shares represented thereby, the par value of each share or a statement that such
shares have no par value, and whether such shares have been fully paid and are
non-assessible, and shall be signed by the president or vice-president and the
secretary or an assistant secretary of the corporation. Where any certificate is
also signed by a transfer agent and a registrar, the signature of any such
officers may be facsimiles.
Article XVI - TRANSFER OF STOCKS - Paragraph 1 - Transfers of shares may
be made only upon the books of the corporation by the holder named in
certificate therefor, or by his attorney duly constituted in writing, and upon
surrender of such certificate properly endorsed by such holder; or by the
secretary when so authorized by the Board of Directors with or without the
surrender of such certificate.
Article XVII - CLOSING OF TRANSFER BOOKS OR FIXING RECORD DATE - Paragraph
1 - The Board of Directors may close the transfer books of the corporation in
his discretion for a period not exceeding 30 days preceding any meeting, annual
or special, of the shareholders. In lieu of closing the stock transfer books, as
aforesaid, before any shareholders meeting, the Board of Directors may fix in
advance the date, not exceeding 30 days preceding the date of any shareholders
<PAGE>
-9-
meeting as a record date for the determination of the shareholders entitled to
notice of, and to vote at, any such meeting, and only shareholders as shall be
shareholders of record on the date so fixed, shall be entitled to such notice
of, and to vote at, such meeting.
Article XVIII - REGISTERED SHAREHOLDERS - Paragraph 1 - The corporation
shall be entitled to treat the holder of record of any share or shares of stock
as the holder in fact thereof and, accordingly, shall not be bound to recognize
any equitable or other claim to or interest in such share on the part of any
other person, whether or not it shall have express or other notice thereof.
Article XIX - LOST CERTIFICATE - Paragraph 1 - The Board of Directors may
direct a new certificate or certificates to be issued in place of any
certificate or certificates theretofore issued by the corporation alleged to
have been lost or destroyed, and acquire the making of an affidavit of that fact
by the person claiming the certificate of stock to be lost or destroyed. When
authorizing such issue of a new certificate or certificates, the Board of
Directors, may, in his discretion and as a condition precedent to the issuance
thereof, require the owner of such lost or destroyed certificate or
certificates, or his legal representative, to advertise the same in such manner
as it shall require and/or give the corporation a bond in such sum as it may
direct as indemnity against any claim that may be made against the corporation
with respect to the certificate alleged to have been lost or destroyed.
Article XX - CHECKS - Paragraph 1 - All checks or demands for money and
notes of the corporation shall be signed by such officer or officers as the
Board of Directors may from time to time designate.
Article XXI - FISCAL YEAR - Paragraph 1 - The fiscal year shall begin on
the first day of January in each year.
<PAGE>
-10-
Article XXII - SEAL - Paragraph 1 - This corporation shall have a
corporate seal which shall be as follows: A circular disk, on the outer margin
of which shall appear the corporate name and state of incorporation, with the
words "Corporate Seal" through the center, so mounted that it may be used to
impress these words in raised letters upon paper, and shall be in charge of the
secretary.
Article XIII - BY-LAWS - Paragraph 1 - These By-Laws may be altered or
amended, or repealed at any regular meeting of the shareholders, or at any
special meeting of the shareholders, if notice of the proposed alteration or
amendment or repeal to be contained in the notice of such special meeting by the
affirmative vote of a majority of the stock issued and outstanding and entitled
to vote thereat, or by the affirmative vote of the majority of the entire Board
of Directors while assembled at a duly called meeting, provided that notice of
the proposed alteration or amendment or repealed be contained in a notice which
has been mailed to each of the directors at least ten days before the meeting at
which said proposal is to acted upon.
<PAGE>
Exhibit 3.19
[GRAPHIC OMITTED]
The State of Texas
SECRETARY OF STATE
IT IS HEREBY CERTIFIED that the attached is/are true and correct copies of
the following described document(s) on file in this office:
NORTH AMERICAN VAN LINES OF TEXAS, INC.
FILE NO. 324239-00
ARTICLES OF INCORPORATION MAY 7, 1973
ARTICLES OF AMENDMENT JUNE 10, 1976
CHANGE OF REGISTERED OFFICE AND/OR AGENT JANUARY 6, 1985
[Seal of the State of Texas] IN TESTIMONY WHEREOF, I have hereunto
signed my name officially and caused to
be impressed hereon the Seal of State at
my office in the City of Austin, on
November 15, 1999.
/s/ Elton Bomer
---------------
Elton Bomer
Secretary of State
<PAGE>
FILED
In the Office of the
Secretary of State of Texas
MAY 7 1973
/s/ [ILLEGIBLE]
Deputy Director, Corporation Division
ARTICLES OF INCORPORATION
OF
MARLEW, INC.
* * * * *
We, the undersigned natural persons of the age of twenty-one years
or more, at least two of whom are citizens of the State of Texas, acting as
incorporators of a corporation under the Texas Business Corporation Act, do
hereby adopt the following Articles of Incorporation for such corporation:
ARTICLE ONE
The name of the corporation is MARLEW, INC.
ARTICLE TWO
The period of its duration is perpetual.
ARTICLE THREE
The purpose or purposes for which the corporation is organized are:
To engage in the transportation business in Texas and elsewhere and
all other lawful purposes.
ARTICLE FOUR
The aggregate number of shares which the corporation shall have
authority to issue is one thousand (1,000) each without par value.
<PAGE>
ARTICLE FIVE
The corporation will not commence business until it has received for
the issuance of its shares consideration of the value of one thousand dollars
($1,000.00), consisting of money, labor done or property actually received,
which sum is not less than One Thousand Dollars ($1,000.00).
ARTICLE SIX
The post office address of its initial registered office is Republic
National Bank Building, c/o C T Corporation System, Dallas, Texas 75201, and the
name of its initial registered agent at such address is C T CORPORATION SYSTEM.
ARTICLE SEVEN
The number of directors of the corporation may be fixed by the
by-laws, but shall not be less than three (3).
The number of directors constituting the initial board of directors
is three (3), and the names and addresses of the persons who are to serve as
directors until the first annual meeting of the shareholders or until their
successors are elected and qualified are:
NAMES ADDRESSES
----- ---------
Donald C. Lewis P. 0. Box 988
Ft. Wayne, Indiana 46801
Martin Weissert P. 0. Box 988
Ft. Wayne, Indiana 46801
Terry G. Fewell P. 0. Box 988
Ft. Wayne, Indiana 46801
ARTICLE EIGHT
The names and address of the incorporators are:
-2-
<PAGE>
FILED
In the Office of the
Secretary of State of Texas
JUN 10 1976
/s/ James B. [ILLEGIBLE]
Deputy Director, Corporation Division
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF MARLEW, INC.
Pursuant to the provisions of 4.04(a) of the Texas Business Corporation
Act, the shareholders of Marlew, Inc., have adopted the following Articles of
Amendment to the Articles of Incorporation of the corporation which implement a
change of corporate name:
ARTICLE ONE
The following amendment to the Articles of Incorporation was adopted on
April 9, 1976.
Article One of the Articles of Incorporation is hereby amended to
read as follows: The name of the Corporation is North American Van Lines
of Texas, Inc.
ARTICLE THREE
The number of shares of the corporation outstanding and entitled to vote
at the time of such adoption was 1,000.
ARTICLE FOUR
The number of shares voted for such amendment was 1,000. No shares voted
against such amendment.
DATED: April 9, 1976.
MARLEW, INC.
By: /s/ [ILLEGIBLE]
------------------------
President
By: /s/ [ILLEGIBLE]
------------------------
Secretary
<PAGE>
STATE OF INDIANA ss.
COUNTY OF ALLEN ss.
I, the undersigned Notary Public, do hereby certify that on this 9th day
of April, 1976, personally appeared before me Stephen Heiman, who declared that
he is President of the Corporation executing the foregoing Amendment to Articles
of Incorporation, and being first duly sworn, acknowledged that he signed the
foregoing document in the capacity of President of said corporate entity and
declared that the statements therein contained are true and correct.
IN WITNESS WHEREOF, I HAVE HEREUNTO SET MY HAND AND SEAL the day and year
before written.
/s/ Carol Jean Korte
------------------------------
NOTARY PUBLIC IN AND FOR ALLEN
COUNTY, INDIANA
My Commission Expires:
CAROL JEAN KORTE
My commission expires September 25, 1979
STATE OF INDIANA ss.
COUNTY OF ALLEN ss.
I, the undersigned Notary Public, do hereby certify that on this 9th day
of April, 1976, personally appeared before me Michael L. Harvey, who declared
that he is Secretary of the Corporation executing the foregoing Amendment to
Articles of Incorporation, and being first duly sworn, acknowledged that he
signed the foregoing document in the capacity of Secretary of said corporate
entity and declared that the statements therein contained are true and correct.
IN WITNESS WHEREOF, I HAVE HEREUNTO SET MY HAND AND SEAL the day and year
before written.
/s/ Carol Jean Korte
------------------------------
NOTARY PUBLIC IN AND FOR ALLEN
COUNTY, INDIANA
My Commission Expires:
CAROL JEAN KORTE
My commission expires September 25, 1979
-2-
<PAGE>
FILED
In the Office of the
Secretary of State of Texas
JAN 06 1985
/s/ Lorna Salzman
Director, Corporation Division
To the Secretary of State
of the State of Texas:
C T Corporation System, as the registered agent for the domestic and
foreign corporations named on the attached list submits the following statement
for the purpose of changing the registered office for such corporations, in the
State of Texas:
1. The name of the corporation is See attached list
2. The post office address of its present registered office is Republic
National Bank Building, c/o C T Corporation System, Dallas, Texas 75201
3. The post office address to which its registered office is to be changed is
1601 Elm Street, c/o C T Corporation System, Dallas, Texas 75201
4. The name of its present registered agent is C T CORPORATION SYSTEM
5. The name of its successor registered agent is C T CORPORATION SYSTEM
6. The post office address of its registered office and the post office
address of the business office of its registered agent, as changed, will
be identical.
7. Notice of this change of address has been given in writing to each
corporation named on the attached list 10 days prior to the date of filing
of this certificate.
Dated January 6, 1985.
C T CORPORATION SYSTEM
By Virginia Colvell
-------------------
Its Vice President
STATE OF New York )
COUNTY OF New York )
I, Regina M. Dunn a notary public, do hereby certify that on this 27th day of
December 1984, personally appeared before me Virginia Colvell who being by me
first duly sworn, declared that she is the Vice President of C T Corporation
System, that she signed the foregoing document as Vice President of the
corporation, and that the statements therein contained are true.
/s/ Regina M. Dunn
------------------
Notary Public
REGINA M. DUNN
Notary Public, State of New York
No. 31-4726520
Qualified in New York County
Commission Expires March 30, 1986
<PAGE>
FILED
In the Office of the
Secretary of State of Texas
JUL 13 1990
Corporations Section
To the Secretary of State
of the State of Texas:
C T Corporation System, as the registered agent for the domestic and
foreign corporations named on the attached list submits the following statement
for the purpose of changing the registered office for such corporations, in the
State of Texas:
1. The name of the corporation is See attached list
2. The post office address of its present registered office is c/o C T
CORPORATION SYSTEM, 1601 ELM STREET, DALLAS, TEXAS 75201
3. The post office address to which its registered office is to be changed is
c/o C T CORPORATION SYSTEM, 350 N. ST. PAUL STREET, DALLAS, TEXAS 75201
4. The name of its present registered agent is C T CORPORATION SYSTEM
5. The name of its successor registered agent is C T CORPORATION SYSTEM
6. The post office address of its registered office and the post office
address of the business office of its registered agent, as changed, will
be identical.
7. Notice of this change of address has been given in writing to each
corporation named on the attached list 10 days prior to the date of filing
of this certificate.
Dated July 2, 1990.
C T CORPORATION SYSTEM
By /s/ [ILLEGIBLE]
-------------------
Its Vice President
<PAGE>
Exhibit 3.20
MARLEW, INC.
*****
BY-LAWS
*****
ARTICLE I
OFFICES
Section 1. The registered office shall be located in the City of
Dallas, State of Texas.
Section 2. The corporation may also have offices at such other
places both within and without the State of Texas as the board of directors may
from time to time determine or the business of the corporation may require.
ARTICLE II
ANNUAL MEETINGS OF SHAREHOLDERS
Section 1. All meetings of shareholders for the election of
directors shall be held in the City of Fort Wayne, State of Indiana, at such
place as may be fixed from time to time by the board of directors.
Section 2. Annual meetings of shareholders, commencing with the year
1973, shall be held on the eleventh day of May if not a legal holiday, and if a
legal holiday, then on the next secular day following, at 10:00 A. M.,
<PAGE>
at which they shall elect by a plurality vote a board of directors, and transact
such other business as may properly be brought before the meeting.
Section 3. Written or printed notice of the annual meeting stating
the place, day and hour of the meeting shall be delivered not less than ten nor
more than fifty days before the date of the meeting, either personally or by
mail, by or at the direction of the president, the secretary, or the officer or
persons calling the meeting, to each shareholder of record entitled to vote at
such meeting.
ARTICLE III
SPECIAL MEETINGS OF SHAREHOLDERS
Section 1. Special meetings of shareholders for any purpose other
than the election of directors may be held at such time and place within or
without the State of Texas as shall be stated in the notice of the meeting or in
a duly executed waiver of notice thereof.
Section 2. Special meetings of the shareholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the articles of
incorporation, may be called by the president, the board of directors, or the
holders of not less than one-tenth of all the shares entitled to vote at the
meeting.
Section 3. Written or printed notice of a special meeting stating
the place, day and hour of the meeting and
<PAGE>
the purpose or purposes for which the meeting is called, shall be delivered not
less than ten nor more than fifty days before the date of the meeting, either
personally or by mail, by or at the direction of the president, the secretary,
or the officer or persons calling the meeting, to each shareholder of record
entitled to vote at such meeting.
Section 4. The business transacted at any special meeting of
shareholders shall be limited to the purposes stated in the notice.
ARTICLE IV
QUORUM AND VOTING OF STOCK
Section 1. The holders of a majority of the shares of stock issued
and outstanding and entitled to vote, represented in person or by proxy, shall
constitute a quorum at all meetings of the shareholders for the transaction of
business except as otherwise provided by statute or by the articles of
incorporation. If, however, such quorum shall not be present or represented at
any meeting of the shareholders, the shareholders present in person or
represented by proxy shall have power to adjourn the meeting from time to time,
without notice other than announcement at the meeting, until a quorum shall be
present or represented. At such adjourned meeting at which a quorum shall be
present or represented any business may be transacted which might have been
transacted at the meeting as originally notified.
<PAGE>
Section 2. If a quorum is present, the affirmative vote of a
majority of the shares of stock represented at the meeting shall be the act of
the shareholders unless the vote of a greater number of shares of stock is
required by law or the articles of incorporation.
Section 3. Each outstanding share of stock, having voting power,
shall be entitled to one vote on each matter submitted to a vote at a meeting of
shareholders. A shareholder may vote either in person or by proxy executed in
writing by the shareholder or by his duly authorized attorney-in-fact.
In all elections for directors every shareholder, entitled to vote,
shall have the right to vote, in person or by proxy, the number of shares of
stock owned by him, for as many persons as there are directors to be elected, or
to cumulate the vote of said shares, and give one candidate as many votes as the
number of directors multiplied by the number of his shares of stock shall equal,
or to distribute the votes on the same principle among as many candidates as he
may see fit.
Section 4. Any action required to be taken at a meeting of the
shareholders may be taken without a meeting if a consent in writing, setting
forth the action so taken, shall be signed by all of the shareholders entitled
to vote with respect to the subject matter thereof.
<PAGE>
ARTICLE V
DIRECTORS
Section 1. The number of directors shall be three. Directors need
not be residents of the State of Texas nor shareholders of the corporation. The
directors, other than the first board of directors, shall be elected at the
annual meeting of the shareholders, and each director elected shall serve until
the next succeeding annual meeting and until his successor shall have been
elected and qualified. The first board of directors shall hold office until the
first annual meeting of shareholders.
Section 2. Any vacancy occurring in the board of directors may be
filled by the affirmative vote of a majority of the remaining directors though
less than a quorum of the board of directors. A director elected to fill a
vacancy shall be elected for the unexpired portion of the term of his
predecessor in office.
Any directorship to be filled by reason of an increase in the number
of directors shall be filled by election at an annual meeting or at a special
meeting of shareholders called for that purpose. A director elected to fill a
newly created directorship shall serve until the next succeeding annual meeting
of shareholders and until his successor shall have been elected and qualified.
Section 3. The business affairs of the corporation shall be managed
by its board of directors which may exercise
<PAGE>
all such powers of the corporation and do all such lawful acts and things as are
not by statute or by the articles of incorporation or by these by-laws directed
or required to be exercised or done by the shareholders.
Section 4. The directors may keep the books of the corporation,
except such as are required by law to be kept within the state, outside of the
State of Texas, at such place or places as they may from time to time determine.
Section 5. The board of directors, by the affirmative vote of a
majority of the directors then in office, and irrespective of any personal
interest of any of its members, shall have authority to establish reasonable
compensation of all directors for services to the corporation as directors,
officers or otherwise.
ARTICLE VI
MEETINGS OF THE BOARD OF DIRECTORS
Section 1. Meetings of the board of directors, regular or special,
may be held either within or without the State of Texas.
Section 2. The first meeting of each newly elected board of
directors shall be held at such time and place as shall be fixed by the vote of
the shareholders at the annual meeting and no notice of such meeting shall be
necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present, or it may convene at such place and
time as shall be fixed by the con-
<PAGE>
sent in writing of all the directors.
Section 3. Regular meetings of the board of directors may be held
upon such notice, or without notice, and at such time and at such place as shall
from time to time be determined by the board.
Section 4. Special meetings of the board of directors may be called
by the president on ten days' notice to each director, either personally or by
mail or by telegram; special meetings shall be called by the president or
secretary in like manner and on like notice on the written request of two
directors.
Section 5. Attendance of a director at any meeting shall constitute
a waiver of notice of such meeting, except where a director attends for the
express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the board
of directors need be specified in the notice or waiver of notice of such
meeting.
Section 6. A majority of the directors shall constitute a quorum for
the transaction of business unless a greater number is required by law or by the
articles of incorporation. The act of a majority of the directors present at
any meeting at which a quorum is present shall be the act of the board of
directors, unless the act of a greater number is required by statute or by the
articles of incorporation.
<PAGE>
If a quorum shall not be present at any meeting of directors, the directors
present thereat may adjourn the meeting from time to time, without notice other
than announcement at the meeting, until a quorum shall be present.
ARTICLE VII
EXECUTIVE COMMITTEE
Section 1. The board of directors, by resolution adopted by a
majority of the number of directors fixed by the by-laws or otherwise, may
designate two or more directors to constitute an executive committee, which
committee, to the extent provided in such resolution, shall have and exercise
all of the authority of the board of directors in the management of the
corporation, except as otherwise required by law. Vacancies in the membership of
the committee shall be filled by the board of directors at a regular or special
meeting of the board of directors. The executive committee shall keep regular
minutes of its proceedings and report the same to the board when required.
ARTICLE VIII
NOTICES
Section 1. Whenever, under the provisions of the statutes or of the
articles of incorporation or of these by-laws, notice is required to be given to
any director or shareholder, it shall not be construed to mean personal notice,
but such notice may be given in writing, by mail, addressed to such director or
shareholder, at his address as
<PAGE>
it appears on the records of the corporation, with postage thereon prepaid, and
such notice shall be deemed to be given at the time when the same shall be
deposited in the United States mail. Notice to directors may also be given by
telegram.
Section 2. Whenever any notice whatever is required to be given
under the provisions of the statutes or under the provisions of the articles of
incorporation or these by-laws, a waiver thereof in writing signed by the person
or persons entitled to such notice, whether before or after the time stated
therein, shall be deemed equivalent to the giving of such notice.
ARTICLE IX
OFFICERS
Section 1. The officers of the corporation shall be chosen by the
board of directors and shall be a president, a vice-president, a secretary and a
treasurer. The board of directors may also choose additional vice-presidents,
and one or more assistant secretaries and assistant treasurers.
Section 2. The board of directors at its first meeting after each
annual meeting of shareholders shall choose a president, one or more
vice-presidents, a secretary and a treasurer, none of whom need be a member of
the board.
Section 3. The board of directors may appoint such other officers
and agents as it shall deem necessary who shall hold their offices for such
terms and shall exercise such
<PAGE>
powers and perform such duties as shall be determined from time to time by the
board of directors.
Section 4. The salaries of all officers and agents of the
corporation shall be fixed by the board of directors.
Section 5. The officers of the corporation shall hold office until
their successors are chosen and qualify. Any officer elected or appointed by the
board of directors may be removed at any time by the affirmative vote of a
majority of the board of directors. Any vacancy occurring in any office of the
corporation shall be filled by the board of directors.
THE PRESIDENT
Section 6. The president shall be the chief executive officer of the
corporation, shall preside at all meetings of the shareholders and the board of
directors, shall have general and active management of the business of the
corporation and shall see that all orders and resolutions of the board of
directors are carried into effect.
Section 7. He shall execute bonds, mortgages and other contracts
requiring a seal, under the seal of the corporation, except where required or
permitted by law to be otherwise signed and executed and except where the
signing and execution thereof shall be expressly delegated by the board of
directors to some other officer or agent of the corporation.
<PAGE>
THE VICE-PRESIDENTS
Section 8. The vice-president, or if there shall be more than one,
the vice-presidents in the order determined by the board of directors, shall, in
the absence or disability of the president, perform the duties and exercise the
powers of the president and shall perform such other duties and have such other
powers as the board of directors may from time to time prescribe.
THE SECRETARY AND ASSISTANT SECRETARIES
Section 9. The secretary shall attend all meetings of the board of
directors and all meetings of the shareholders and record all the proceedings of
the meetings of the corporation and of the board of directors in a book to be
kept for that purpose and shall perform like duties for the standing committees
when required. He shall give, or cause to be given, notice of all meetings of
the shareholders and special meetings of the board of directors, and shall
perform such other duties as may be prescribed by the board of directors or
president, under whose supervision he shall be. He shall have custody of the
corporate seal of the corporation and he, or an assistant secretary, shall have
authority to affix the same to any instrument requiring it and when so affixed,
it may be attested by his signature or by the signature of such assistant
secretary. The board of directors may give general authority to any other
officer to affix the seal of the corpo-
<PAGE>
ration and to attest the affixing by his signature.
Section 10. The assistant secretary, or if there be more than one,
the assistant secretaries in the order determined by the board of directors,
shall, in the absence or disability of the secretary, perform the duties and
exercise the powers of the secretary and shall perform such other duties and
have such other powers as the board of directors may from time to time
prescribe.
THE TREASURER AND ASSISTANT TREASURERS
Section 11. The treasurer shall have the custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the board of directors.
Section 12. He shall disburse the funds of the corporation as may be
ordered by the board of directors, taking proper vouchers for such
disbursements, and shall render to the president and the board of directors, at
its regular meetings, or when the board of directors so requires, an account of
all his transactions as treasurer and of the financial condition of the
corporation.
Section 13. If required by the board of directors, he shall give the
corporation a bond in such sum and with
<PAGE>
such surety or sureties as shall be satisfactory to the board of directors for
the faithful performance of the duties of his office and for the restoration to
the corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of whatever
kind in his possession or under his control belonging to the corporation.
Section 14. The assistant treasurer, or, if there shall be more than
one, the assistant treasurers in the order determined by the board of directors,
shall, in the absence or disability of the treasurer, perform the duties and
exercise the powers of the treasurer and shall perform such other duties and
have such other powers as the board of directors may from time to time
prescribe.
ARTICLE X
CERTIFICATES FOR SHARES
Section 1. The shares of the corporation shall be represented by
certificates signed by the president or a vice-president and the secretary or an
assistant secretary of the corporation, and may be sealed with the seal of the
corporation or a facsimile thereof.
When the corporation is authorized to issue shares of more than one
class, every certificate shall set forth upon the face or back of such
certificate a statement of the designations, preferences, limitations and
relative rights of
<PAGE>
the shares of each class authorized to be issued, as required by the laws of the
State of Texas.
Section 2. The signatures of the officers of the corporation upon a
certificate may be facsimiles if the certificate is countersigned by a transfer
agent, or registered by a registrar, other than the corporation itself or an
employee of the corporation. In case any officer who has signed or whose
facsimile signature has been placed upon such certificate shall have ceased to
be such officer before such certificate is issued, it may be issued by the
corporation with the same effect as if he were such officer at the date of its
issue.
LOST CERTIFICATES
Section 3. The board of directors may direct a new certificate to be
issued in place of any certificate theretofore issued by the corporation alleged
to have been lost or destroyed. When authorizing such issue of a new
certificate, the board of directors, in its discretion and as a condition
precedent to the issuance thereof, may prescribe such terms and conditions as it
deems expedient, and may require such indemnities as it deems adequate, to
protect the corporation from any claim that may be made against it with respect
to any such certificate alleged to have been lost or destroyed.
<PAGE>
TRANSFERS OF SHARES
Section 4. Upon surrender to the corporation or the transfer agent
of the corporation of a certificate representing shares duly endorsed or
accompanied by proper evidence of succession, assignment or authority to
transfer, a new certificate shall be issued to the person entitled thereto, and
the old certificate cancelled and the transaction recorded upon the books of the
corporation.
CLOSING OF TRANSFER BOOKS
Section 5. For the purpose of determining shareholders entitled to
notice of or to vote at any meeting of shareholders, or any adjournment thereof
or entitled to receive payment of any dividend, or in order to make a
determination of shareholders for any other proper purpose, the board of
directors may provide that the stock transfer books shall be closed for a stated
period but not to exceed, in any case, fifty days. If the stock transfer books
shall be closed for the purpose of determining shareholders entitled to notice
of or to vote at a meeting of shareholders, such books shall be closed for at
least ten days immediately preceding such meeting. In lieu of closing the stock
transfer books, the board of directors may fix in advance a date as the record
date for any such determination of shareholders, such date in any case to be not
more than fifty days and, in case of a meeting of shareholders, not less than
ten days prior to the date on which the particular action, requiring such
determina-
<PAGE>
tion of shareholders, is to be taken. If the stock transfer books are not closed
and no record date is fixed for the determination of shareholders entitled to
notice of or to vote at a meeting of shareholders, or shareholders entitled to
receive payment of a dividend, the date on which notice of the meeting is mailed
or the date on which the resolution of the board of directors declaring such
dividend is adopted, as the case may be, shall be the record date for such
determination of shareholders. When a determination of shareholders entitled to
vote at any meeting of shareholders has been made as provided in this section,
such determination shall apply to any adjournment thereof.
REGISTERED SHAREHOLDERS
Section 6. The corporation shall be entitled to recognize the
exclusive right of a person registered on its books as the owner of shares to
receive dividends, and to vote as such owner, and to hold liable for calls and
assessments a person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or other claim to or interest in such
share or shares on the part of any other person, whether or not it shall have
express or other notice thereof, except as otherwise provided by the laws of
Texas.
<PAGE>
LIST OF SHAREHOLDERS
Section 7. The officer or agent having charge of the transfer books
for shares shall make, at least ten days before each meeting of shareholders, a
complete list of the shareholders entitled to vote at such meeting, arranged in
alphabetical order, with the address of each and the number of shares held by
each, which list, for a period of ten days prior to such meeting, shall be kept
on file at the registered office of the corporation and shall be subject to
inspection by any shareholder at any time during usual business hours. Such list
shall also be produced and kept open at the time and place of the meeting and
shall be subject to the inspection of any shareholder during the whole time of
the meeting. The original share ledger or transfer book, or a duplicate thereof,
shall be prima facie evidence as to who are the shareholders entitled to examine
such list or share ledger or transfer book or to vote at any meeting of the
shareholders.
ARTICLE XI
GENERAL PROVISIONS
DIVIDENDS
Section 1. Subject to the provisions of the articles of
incorporation relating thereto, if any, dividends may be declared by the board
of directors at any regular or special meeting, pursuant to law. Dividends may
be paid in cash, in property or in shares of the capital
<PAGE>
stock, subject to any provisions of the Articles of Incorporation.
Section 2. Before payment of any dividend, there may be set aside
out of any funds of the corporation available for dividends such sum or sums as
the Directors from time to time, in their absolute discretion, think proper as a
reserve fund to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or for such other
purpose as the Directors shall think conducive to the interest of the
corporation, and the Directors may modify or abolish any such reserve in the
manner in which it was created.
CHECKS
Section 3. All checks or demands for money and notes of the
corporation shall be signed by such officer or officer or such other person or
persons as the Board of Directors may from time to time designate.
FISCAL YEAR
Section 4. The fiscal year of the corporation shall be fixed by
resolution of the Board of Directors.
SEAL
Section 5. The corporate seal shall have inscribed thereon the name
of the corporation and the words "corporate seal" in the center of the circular
disc. The
<PAGE>
seal may be used by causing it or a facsimile thereof to be impressed or affixed
or in any manner reproduced.
ARTICLE XII
AMENDMENTS
Section 1. These by-laws may be altered, amended or repealed or new
by-laws may be adopted at any regular or special meeting of shareholders at
which a quorum is present or represented, by the affirmative vote of a majority
of the stock entitled to vote, provided notice of the proposed alteration,
amendment or repeal be contained in the notice of such meeting.
The power to repeal, amend the by-laws, and adopt new by-laws may be
delegated to the board of directors by a similar vote at any such meeting. The
power, when delegated, may be revoked by a similar vote at any meeting of the
shareholders.
<PAGE>
Exhibit 3.21
STATE OF MONTANA 230558
OFFICE OF THE SECRETARY OF STATE STATE OF MONTANA
FILED
STATEMENT OF CHANGE OF REGISTERED AGENT DEC. 15, 1997
AND/OR REGISTERED OFFICE SECRETARY OF STATE
D - 029897
FOR THE PURPOSE OF HAVING AND CONTINUOUSLY MAINTAINING A REGISTERED AGENT AT A
REGISTERED OFFICE WITHIN THE STATE OF MONTANA, THE UNDERSIGNED SUBMITS THE
FOLLOWING STATEMENTS OF FACT TO THE SECRETARY OF STATE:
1. THE EXACT NAME OF THE ENTITY:
GREAT FALLS NORTH AMERICAN, INC.
2. THE STREET AND MAILING ADDRESS OF THE CURRENT REGISTERED OFFICE:
406 FULLER AVE
BOX 1166
HELENA MT 59624-1166
3. THE STREET AND MAILING ADDRESS OF THE NEW REGISTERED OFFICE:
40 W LAWRENCE STE A
P0 BOX 1166
HELENA MT 59624-1166
4. THE NAME OF THE CURRENT REGISTERED AGENT:
C T CORPORATION SYSTEM
5. THE NAME OF THE NEW REGISTERED AGENT:
6. THE UNDERSIGNED FURTHER CERTIFIES THAT THE STREET ADDRESS OF THE
REGISTERED OFFICE AND THE ADDRESS OF THE BUSINESS OFFICE OF THE REGISTERED
AGENT, AS CHANGED, WILL BE IDENTICAL.
7. THE UNDERSIGNED FURTHER CERTIFIES THAT THE NAMED ENTITY HAS BEEN NOTIFIED
OF THE CHANGE.
8. BY MY SIGNATURE, I, AS AN OFFICIAL OF THE ABOVE REGISTERED AGENT, DO
CERTIFY THAT THE STATEMENTS CONTAINED THEREIN ARE TRUE, UNDER PENALTY OF
LAW.
/s/ Kenneth J. Uva 12/15/1997
- ------------------------------ ----------
SIGNATURE OF AUTHORIZED PERSON DATED
KENNETH J. UVA, VICE PRESIDENT
- -----------------------------------------
NAME AND TITLE OF ABOVE AUTHORIZED PERSON
<PAGE>
F 152710
STATE OF MONTANA
FILED
STATE OF MONTANA MAY 11 1971
FRANK MURRAY
STATEMENT OF CHANGE OF REGISTERED OFFICE SECRETARY OF STATE
OF By /s/ [ILLEGIBLE]
----------------
DOMESTIC AND FOREIGN CORPORATIONS $2.00 Deputy
THIS DOCUMENT IS A
BY REGISTERED AGENT COPY OF A PART OF
AN ORIGINAL ON FILE
IN FOLDER F 2888
TO THE SECRETARY OF STATE
OF THE STATE OF MONTANA
Capitol
Helena, Montana 59601
Pursuant to the provisions of Sections 15-2212, 15-22-107, 15-2309, and 15-2371,
R.C.M. 1947, for the purpose of changing the registered office address of each
of the domestic and foreign corporations for which C T Corporation System is the
registered agent in Montana, C T Corporation System hereby submits the following
statement:
FIRST:
The name of the registered agent of each of the corporations named on the
attached sheets is C T Corporation System.
SECOND:
The present address of the business office of the registered agent, and the
present address of the registered office of each of the named corporations, is
11 Edwards Street, Helena, Montana 59601.
THIRD:
The address to which the business office of the registered agent and the
registered office of each of the named corporations is to be changed is 406
Fuller Avenue, Helena, Montana 59601.
FOURTH:
The address of the registered office and the address of the business office of
the registered agent of each of the named corporations, as changed, will be
identical.
-1-
<PAGE>
GREAT FALLS NORTH AMERICAN INC DOM.--MONTANA
<PAGE>
Every corporation is required under Sections 15-2211, 15-22-106, 15-2308 or
15-2370, Revised Codes of Montana, 1947, to have and continuously maintain in
Montana a registered office and a registered agent at such office. Any
corporation which changes its registered office or registered agent, or both, or
whose agent dies or resigns or changes his or its address must file a statement
of such change in the following form with the Secretary of State.
(For use by the Secretary of State only)
164917
STATE OF MONTANA
FILED DEC 7, 1970
FRANK MURRAY
SECRETARY OF STATE
By /s/ Alex [ILLEGIBLE]
-----------------------
Deputy
STATE OF MONTANA Filing Fee: $2.00
Statement of Change
of Registered Office or Registered Agent, or Both, of Corporation
TO THE SECRETARY OF STATE
OF THE STATE OF MONTANA
Capitol
Helena, Montana 59601
Pursuant to the provisions of Section 15-2212, R.C.M. 1947, as a domestic profit
corporation, Section 15-22-107, R.C.M. 1947, as a foreign profit corporation,
Section 15-2309, R.C.M. 1947, as a domestic nonprofit corporation, or Section
15-2371, R.C.M. 1947, as a foreign nonprofit corporation, the undersigned
corporation, organized under the laws of Montana, submits the following
statement for the purpose of changing its registered office or its registered
agent, or both, in the State of Montana:
FIRST:
The name of the corporation is GREAT FALLS NORTH AMERICAN, INC.
SECOND:
The address of its present registered office is
1111 Smelter Avenue
- --------------------------------------------------------------------------------
(street number) (street)
Black Eagle ,Montana 59414
- --------------------------------------------------------------------------------
(city or town) (zip code)
SIXTH:
The address of its registered office and the address of the business office of
its registered agent, as changed, will be identical.
SEVENTH:
Such change was authorized by resolution duly adopted by its board of directors.
DATED: September 8, 1970
- --------------------------------------------------------------------------------
WARNING
"PENALTIES IMPOSED UPON OFFICERS AND DIRECTORS. Each officer and director of a
corporation, domestic or foreign, who signs any articles, statement, report,
application or other document filed with the secretary of state which is known
to such officer or director to be false in any material respect, shall be deemed
to be guilty of a misdemeanor, and upon conviction thereof may be fined in any
amount not exceeding five hundred dollars ($500)."
(Sections 15-22-126 and 15-2386, R.C.M. 1947)
- --------------------------------------------------------------------------------
GREAT FALLS NORTH AMERICAN, INC.
ARTICLES OF INCORPORATION
OF
GREAT FALLS NORTH AMERICAN, INC.
KNOW ALL MEN BY THESE PRESENTS: That we, the undersigned, have this day
voluntarily associated ourselves together for the purpose of forming a
corporation under the laws of the State of Montana, and we do hereby certify:
I.
The name of the corporation is GREAT FALLS NORTH AMERICAN, INC.
II.
The purposes for which it is formed are:
(a) To buy, sell, distribute, warehouse and transport all kinds of
goods, wares, merchandise and commodities, including all kinds of tangible
or intangible property;
(b) To transport, for hire, as a common or contract or private
carrier, all kinds of goods, wares, merchandise and commodities, including
all kinds of tangible or intangible property;
(c) To own, lease, maintain and operate warehouses and other
appropriate facilities for the storage or safe-keeping, for hire, of all
kinds of goods, wares, merchandise and commodities, including all kinds of
tangible or intangible property;
(d) To acquire, in any lawful manner, and to hold,
<PAGE>
use, lease, exchange and dispose of any kind of property, real or
personal, including specifically but not limited to stocks, bonds,
securities or other evidences of indebtedness of this or any other
corporation or of any person or person whomsoever;
(e) To borrow and/or loan money, with or without security and to
execute guaranty agreements, and to mortgage, pledge or otherwise secure
with property of this corporation my indebtedness incurred by this
corporation;
(f) To do any act which facilitates the achievement of any of the
aforesaid purposes.
III.
The principal place of business of the corporation shall be Great Falls,
Cascade County, Montana, and until otherwise established by its Board of
Directors, its' mailing address shall be 1111 Smelter Avenue, Great Falls,
Montana.
IV.
The term for which the corporation is to exist is forty years from and
after the date of its incorporation.
V.
The number of its directors shall be three, and the names and residences
of those who will serve for the first three months, or until their successors
are elected and qualified are:
-2-
<PAGE>
NAME RESIDENCE
---- ---------
James D. Edgett Fort Wayne, Indiana
Paul Clarke Fort Wayne, Indiana
Kenneth W. Maxfield Fort Wayne, Indiana
VI.
The amount of the capital stock of said corporation shall be Fifty
Thousand shares of common stock without par value.
VII.
The amount of capital stock which has actually been subscribed is $60 and
the following are the names of the persons by whom the same has been subscribed:
NAME NUMBER OF SHARES AMOUNT
---- ---------------- ------
Jams D. Edgett 1 $10.00
Paul Clarke 1 10.00
Kenneth W. Maxfield 1 10.00
M. Kavanaugh 1 10.00
P. D. Webb 1 10.00
B. A. Murray 1 10.00.
IN WITNESS WHEREOF, the undersigned have executed this instrument this
21st day of March, 1962.
/s/ M. Kavanaugh
----------------
M. Kavanaugh
/s/ B. A. Murray
----------------
B. A. Murray
/s/ P. D. Webb
----------------
P. D. Webb
-3-
<PAGE>
STATE OF MONTANA )
) ss.
County of Yellowstone )
On this 21st day of March, 1962, before me, JAMES H. KILBOURNE, a Notary
Public in and for the State of Montana, personally appeared M. KAVANAUGH, B. A.
MURRAY and P. D. WEBB, known to me to be the persons whose names are subscribed
to the foregoing instrument and acknowledged to me that they created the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my Notarial
Seal the day and year first above written.
/s/ [ILLEGIBLE]
--------------------------------------
Notary Public for the State of Montana
Residing at Billings, Montana
(NOTARIAL SEAL) My commission expires December 8, 1962
[ILLEGIBLE]
-4-
<PAGE>
Exhibit 3.22
BY-LAWS
OF
GREAT FALLS NORTH AMERICAN, INC.
A corporation organized and existing
under and by virtue of the laws of the
State of Montana
----------------
ARTICLE I.
Name and Location
Section 1. The name of this corporation shall be
GREAT FALLS NORTH AMERICAN, INC.
Section 2. Its principal office shall be located at Great Falls, Montana.
Section 3. Other offices for the transaction of business shall be located
at such places as the Board of Directors may from time to time determine.
ARTICLE II.
Section 1. The amount of the capital stock shall be 50,000 shares of
common stock without par value.
Section 2. All certificates of stock shall be signed by the president and
secretary, and sealed with the corporate seal, and shall express on their face
their number, date of issuance, number of shares for which and persons to whom
issued. Certificates of stock shall be of such form and device as the Board of
Directors may direct.
Section 3. Treasury stock shall be held by the corporation, subject to the
disposal of the Board of Directors, and shall neither vote nor participate in
dividends.
<PAGE>
Section 4. The corporation shall have a first lien on all the shares of
its capital stock, and upon all dividends declared upon the same, for any
indebtedness of the respective holders thereof to the corporation.
Section 5. Shares of stock of the corporation may be transferred at any
time by the holder thereof, or by attorney appointed or constituted, or by legal
representative. No transfer shall be valid except between the parties thereto,
until entered in proper form in the books of the company. The stock books of the
corporation shall be closed against transfers for a period of 30 days before the
day of payment of a dividend, and for ten days before each annual meeting of
stockholders.
Section 6. In case of loss or destruction of a certificate of stock, no
new certificate shall be issued in lieu thereof, except upon satisfactory proof
to the Board of Directors of such loss or destruction; and upon the giving of
satisfactory security, by bond or otherwise, against loss to the corporation.
Any such new certificate shall be plainly marked "Duplicate" upon its face.
ARTICLE III.
Stockholders' Meetings
Section 1. The annual meeting of the stockholders shall be held at 2:00
o'clock P.M. on the last Monday of the second calendar month immediately
succeeding the close of the corporation's fiscal year at the principal office of
the company in the State of Montana. When such day shall fall on a legal
holiday, the meeting shall be held on the next succeeding business day. At such
meeting the stockholders shall elect directors by ballot, to serve until
-2-
<PAGE>
their successors shall be elected and qualified, and shall transact such other
business as shall properly come before the meeting.
Section 2. A special meeting of the stockholders may be called at any time
by the president, and in his absence by the vice-president or by any two
directors of said corporation. It shall be the duty of the directors, president
or vice-president to call such meeting whenever so requested by stockholders
holding 20% or more of the capital stock entitled to vote.
Section 3. Notice of the time and place of all annual and special meetings
shall be mailed by the secretary to each stockholder 10 days before the date of
said meeting, except that regular and/or special meetings of said stockholders
may be held at any time or place, or for any purpose or purposes, when each and
all of said stockholders consent in writing to the holding of such meeting.
Where special meetings of stockholders are called for purposes which under the
laws of Montana require other forms of notice, such notice shall be given to the
stockholders as shall be required by said laws.
Section 4. The president, or in his absence the vice-president, shall
preside at all such meetings, both annual and special.
Section 5. At every such meeting, each stockholder shall be entitled to
cast one vote for each share of stock entitled to vote held in his name, which
vote may be cast by him either in person or by proxy. All proxies shall be in
writing, and shall be filed with the secretary, and by him entered in the
minutes of the meeting.
-3-
<PAGE>
Section 6. A quorum for the transaction of business at any such meeting,
either regular or special, shall consist of a number of members representing a
majority of the shares of stock issued and outstanding and entitled to vote; but
the stockholders present at any meeting thereof less than a quorum may adjourn
the meeting to a future time.
Section 7. The stockholders shall have power, by a majority vote at any
such meeting, to remove any director or officer from office.
ARTICLE IV.
Directors
Section 1. The corporate powers, business and property of the corporation
shall be exercised, conducted and controlled by a Board of three directors, who
shall be elected by the stockholders; each director shall be a stockholder; each
director shall receive an attendance fee of $25.00 for each official meeting of
said Board of Directors which he attends, together with his actual expenses in
attending said meeting.
Section 2. The regular meeting of the Board of Directors of the
corporation shall be held at the office of the corporation in Great Falls,
Montana, on the last Monday of the second calendar month immediately succeeding
the close of the corporation's fiscal year, and quarterly thereafter; provided,
however, that whenever such day shall fall upon a legal holiday, the meeting
shall be held on the next succeeding business day.
Section 3. Special meetings of the Board of Directors may be called by the
president, and in his absence by the vice-president
-4-
<PAGE>
or by any two members of the Board. By written consent of all the directors,
regular or special meetings of the Board may be held without notice, at any time
or place and for any purpose or purposes.
Section 4. Notice of all meetings except those specified in the second
sentence of Section 3 of this Article, shall be mailed as directed by the
secretary, at least five days previous to the time fixed for the meeting, and
all notices of special meetings shall state the purpose thereof.
Section 5. A quorum for the transaction of business of any regular or
special meeting of the directors shall consist of any two members of the Board,
but a majority of those present at any regular or special meeting shall have
power to adjourn the meeting to a future date.
Section 6. The directors shall elect the officers of the corporation, and
fix their salaries; and the president and vice-president of said corporation
shall be selected from the members of said Board of Directors. An officer may be
removed at any time by a two-thirds vote of the full Board of Directors.
Section 7. A vacancy in the Board of Directors may be filled by the
remaining directors at any regular or special directors' meeting.
Section 8. The directors may, by resolution, appoint members of the Board
as an executive committee, to manage the business of the corporation during
interim between meetings of the Board.
Section 9. At each annual meeting of stockholders, the directors shall
submit a statement of the business done during
-5-
<PAGE>
the preceding year, together with a report of the general financial condition of
the corporation, and of the condition of its tangible property. A similar
statement shall be presented at any special meeting of stockholders, when
requested by persons representing at least one-tenth of the subscribed capital
stock of the corporation. The request shall be in writing, and shall be
delivered to the secretary of the company at least five days before the date of
the special meeting.
Section 10. The Board of Directors shall have power to buy such property,
both real and personal, as it shall consider necessary or advisable for the best
interests of the company. It shall also have power to sell, lease, mortgage,
exchange, or otherwise dispose of any part or all of the property, both real and
personal, of said corporation without submitting the same to a vote of the
stockholders of the corporation. The Board of Directors shall have authority to
incur such indebtedness as it shall deem necessary.
Section 11. The Board of Directors shall cause to be kept a record of all
of their meetings and acts, and also of the proceedings of the stockholders.
Section 12. The officers and directors of the corporation shall each year,
within the time allowed by law, make and file the annual statement and such
other reports of the corporation as may be required by law.
Section 13. There is hereby delegated to the Board of Directors the power,
by provision to be duly made in these By-Laws, to designate and describe the
different series, if any, on any class
-6-
<PAGE>
of stock, the manner of issuing, preferences, limitations, restrictions and
other terms and conditions of or on which each class of stock or any series
thereof shall be issued.
Section 14. The Board of Directors shall by resolution from time to time
fix the fiscal year of the corporation.
ARTICLE V.
When Notice of Meetings Unnecessary
Section 1. When all of the stockholders are present at a meeting of
stockholders, or when all of the directors are present at a meeting of the Board
of Directors, the acts and proceedings of such meeting are valid, regardless of
the manner of calling said meeting, and of notice or lack of notice of said
meeting, provided all of the stockholders at such stockholders' meeting, or all
of the directors at such directors' meeting, sign a written consent thereto on
the records of such meeting.
ARTICLE VI.
Officers
Section 1. The officers of this corporation shall be a president,
vice-president, secretary and treasurer, and such assistant secretaries and
assistant treasurers as the Board may from time to time deem proper, each of
whom shall be elected for the term of one year and until their successors are
duly elected and qualified, and each of whom shall hold office for that period.
No one shall be eligible to the office of president or vice-president who is not
a director of the corporation, and if either of such officers ceases to be a
director, he shall likewise cease to hold office as president or vice-president
as soon as his successor is elected and
-7-
<PAGE>
qualified. The offices of secretary and treasurer may be held by one person.
Section 2. The president shall preside at all directors' and stockholders'
meetings and, subject to the control and supervision of the Board of Directors,
shall have general supervision over the affairs of the corporation, and over the
other officers; shall sign all stock certificates or written contracts of the
corporation, and shall perform all such other duties as are incident to his
office. In case of the absence or disability of the president, his duties shall
be performed by the vice-president.
Section 3. That unless meetings are held pursuant to written consent of
all stockholders and/or directors, the secretary shall issue notices of all
directors' and stockholders' meetings, and shall attend and keep the minutes of
the same; shall have charge of all corporate books, records and papers; shall
have custody of the corporate seal; shall attest with his signature and impress
with the corporate seal the stock certificates and contracts of the corporation;
and shall perform all such other duties as are incident to his office. The
assistant secretary shall have such authority as may be from time to time
conferred upon him by resolution of the Board of Directors.
Section 4. The treasurer shall keep legal books of account, and shall
submit them, together with all his vouchers, receipts, records and other papers,
to the directors for their examination and approval, as often as they may
require, and shall perform all such other duties as may be incident to his
office.
Section 5. The officers of the corporation shall also perform
-8-
<PAGE>
such duties as usually devolve upon such officers of corporations, and such
other duties as may be prescribed by the Board of Directors.
ARTICLE VII.
Dividends and Finance
Section 1. Dividends shall be paid from time to time, when, as and if
declared by the Board of Directors, from any source from which under the laws of
the State of Montana dividends may lawfully be paid.
Section 2. The funds of the corporation shall be deposited in such bank as
the directors shall designate, and shall be withdrawn only upon order of
officers duly authorized by the Board of Directors.
ARTICLE VIII.
Section 1. The books and papers in the office of the secretary shall at
all times during business hours be open to the inspection of any stockholder.
Section 2. The original Articles of Incorporation, By-Laws, and minutes of
all directors' and stockholders' meetings shall be kept at the office of the
company in Great Falls, Montana.
ARTICLE IX.
Corporate Seal
Section 1. The corporate seal of said corporation shall be circular in
form, with the words "GREAT FALLS NORTH AMERICAN, INC." and "STATE OF MONTANA"
in a circle about the outer edge thereof, and the words "CORPORATE SEAL" across
the face thereof.
ARTICLE X.
Section 1. These By-Laws shall be kept in the minute book
-9-
<PAGE>
of the corporation, and shall always remain in the possession of the secretary,
and may be inspected at any time during office hours by any stockholder of the
corporation.
ARTICLE XI.
Section 1. These By-Laws may be altered or amended at any annual meeting
of the stockholders, or at any special meeting called for that purpose, by a
vote of two-thirds of the subscribed and outstanding capital stock entitled to
vote.
/s/ M. Kavanaugh
-----------------------------------------
M. KAVANAUGH
/s/ P. D. Webb
-----------------------------------------
P. D. WEBB
/s/ B. A. Murray
-----------------------------------------
B. A. MURRAY
The undersigned, the three incorporators of GREAT FALLS NORTH AMERICAN,
INC., hereby certify that the foregoing By-Laws, consisting of ten pages,
including this page, constitute the By-Laws of said company duly adopted by said
incorporators at the initial meeting of the incorporators held on March 29,
1962.
/s/ M. Kavanaugh
-----------------------------------------
M. KAVANAUGH
/s/ P. D. Webb
-----------------------------------------
P. D. WEBB
/s/ B. A. Murray
-----------------------------------------
B. A. MURRAY
-10-
<PAGE>
SUBSCRIPTION LIST
We, the undersigned, hereby each subscribe to one share of common
stock, no par value, to be issued by GREAT FALLS NORTH AMERICAN, INC., a Montana
corporation to be formed, and agree to pay the subscription price of $10.00 per
share upon call of the Board of Directors of said company.
Dated March 21, 1962.
/s/ James D. Edgett
-----------------------------------------
JAMES D. EDGETT
/s/ Paul Clarke
-----------------------------------------
PAUL CLARKE
/s/ Kenneth W. Maxfield
-----------------------------------------
KENNETH W. MAXFIELD
/s/ M. Kavanaugh
-----------------------------------------
M. KAVANAUGH
/s/ B. A. Murray
-----------------------------------------
B. A. MURRAY
/s/ P. D. Webb
-----------------------------------------
P. D. WEBB
<PAGE>
Exhibit 3.23
State of Delaware
PAGE 1
Office of the Secretary of State
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF AMENDMENT
OF "RELOCATION SOLUTIONS MANAGEMENT, INC.", CHANGING ITS NAME FROM "RELOCATION
SOLUTIONS MANAGEMENT, INC." TO "A RELOCATION SOLUTIONS MANAGEMENT COMPANY",
FILED IN THIS OFFICE ON THE ELEVENTH DAY OF APRIL, A.D. 1997, AT 11 O'CLOCK A.M.
A CERTIFIED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE NEW CASTLE
COUNTY RECORDER OF DEEDS FOR RECORDING.
[STATE SEAL]
/s/ Edward J. Freel
[SEAL] ----------------------------------------
Edward J. Freel, Secretary of State
2018649 8100 AUTHENTICATION: 8416417
971117815 DATE: 04-11-97
<PAGE>
STATE OF DELAWARE
CERTIFICATE OF AMENDMENT
OF CERTIFICATE OF INCORPORATION
Relocation Solutions Management, Inc. a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware.
DOES HEREBY CERTIFY:
FIRST: That at a meeting of the Board of Directors of Relocation Solutions
Management, Inc. resolutions were duly adopted setting forth a proposed
amendment of the Certificate of Incorporation of said corporation, declaring
said amendment to be advisable and calling a meeting of the stockholders of said
corporation for consideration thereof. The resolution setting forth the proposed
amendment is as follows:
RESOLVED, that the Certificate of Incorporation of this corporation be amended
by changing the Article thereof numbered "One" so that, as amended, said Article
shall be and read as follows:
The name of the corporation is:
A Relocation Solutions Management Company
SECOND: That thereafter, pursuant to resolution of its Board of Directors, a
special meeting of the stockholders of said corporation was duly called and held
upon notice in accordance with Section 222 of the General Corporation Law of the
State of Delaware at which meeting the necessary number of shares as required by
statute were voted in favor of the amendment.
THIRD: That said amendment was duly adopted in accordance with the provisions of
Section 242 of the General Corporation Law of the State of Delaware.
FOURTH: That the capital of said corporation shall not be reduced under or by
reason of said amendment.
IN WITNESS WHEREOF, said Relocation Solutions Management, Inc. has caused this
certificate to be signed by Richard V. Merrill - Asst. Secretary, an Authorized
Officer, this 9th day of April, 1997.
BY: /s/ Richard Merrill
-----------------------
TITLE OF OFFICER: Assistant Secretary
<PAGE>
PAGE 1 [STATE CREST] State of Delaware 971103742
SECRETARY OF STATE
DIVISION OF CORPORATIONS
P.O. BOX 898
DOVER, DELAWARE 19903
9184131 04-04-97
ALLIED VAN LINES, INC.
215 W. DIEHL ROAD
NAPERVILLE IL 60563
ATTN: RENATO TUNGOL
- --------------------------------------------------------------------------------
DESCRIPTION AMOUNT
- --------------------------------------------------------------------------------
RELOCATION SOLUTIONS MANAGEMENT, INC.
2018649 0240 Amendment; Domestic
Amendment Fee 30.00
Receiving/Indexing 50.00
Certification Fee 20.00
Doc/Maint Fee, New Castle 6.00
Document Page Fee, New Castle 9.00
Cert Page Fee, New Castle 9.00
FILING TOTAL 124.00
TOTAL PAYMENTS 124.00
SERVICE REQUEST BALANCE .00
<PAGE>
STATE OF DELAWARE
CERTIFICATE OF AMENDMENT
OF CERTIFICATE OF INCORPORATION
ALLIED RELOCATION SERVICES, INC., a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware.
DOES HEREBY CERTIFY:
FIRST: That at a meeting of the Board of Directors of Allied Relocation
Services, Inc., resolutions were duly adopted setting forth a proposed amendment
of the Certificate of Incorporation of said corporation, declaring said
amendment to be advisable and calling a meeting of the stockholders of said
corporation for consideration thereof. The resolution setting forth the proposed
amendment is as follows:
RESOLVED, that the Certificate of Incorporation of this corporation be amended
by changing the Article thereof numbered "One" so that, as amended, said Article
shall be and read as follows:
The name of the corporation is:
RELOCATION SOLUTIONS MANAGEMENT, INC.
SECOND: That thereafter, pursuant to resolution of its Board of Directors, a
special meeting of the stockholders of said corporation was duly called and held
upon notice in accordance with Section 222 of the General Corporation Law of the
State of Delaware at which meeting the necessary number of shares as required by
statute were voted in favor of the amendment.
THIRD: That said amendment was duly adopted in accordance with the provisions of
Section 242 of the General Corporation Law of the State of Delaware.
FOURTH: That the capital of said corporation shall not be reduced under or by
reason of said amendment.
IN WITNESS WHEREOF, said Allied Relocation Services, Inc. has caused this
certificate to be signed by Richard V. Merrill - Asst. Secretary, an Authorized
Officer, this 27th day of March 1997.
BY: /s/ Richard Merrill
-----------------------
TITLE OF OFFICER: Assistant Secretary
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:00 AM 03/31/1997
971103742 - 2018649
<PAGE>
REC M145 PAGE 566
STATE OF DELAWARE
[STATE CREST]
Office of Secretary of State
------------------------
I, GLENN C. KENTON, SECRETARY OF STATE OF THE STATE OF DELAWARE DO HEREBY
CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
INCORPORATION OF ALLIED RELOCATION SERVICES, INC. FILED IN THIS OFFICE ON THE
SIXTH DAY OF OCTOBER, A.D. 1983, AT 10 O'CLOCK A.M.
/s/ Glenn C. Kenton
---------------------------------------
Glenn C. Kenton, Secretary of State
AUTHENTICATION: :0084433
732790007 DATE: 10/06/1983
<PAGE>
REC M145 PAGE 567
FILED
OCT 6 1983
/s/ Glenn C. Kenton
SECRETARY OF STATE
CERTIFICATE OF INCORPORATION
OF
ALLIED RELOCATION SERVICES, INC.
---ooOoo--
1. The name of the corporation is:
ALLIED RELOCATION SERVICES, INC.
2. The address of its registered office in the State of Delaware is 100
West Tenth Street in the City of Wilmington, County of New Castle. The name of
its registered agent at such address is The Corporation Trust Company.
3. The nature of the business or purposes to be conducted or promoted is
to engage in any lawful act or activity for which corporations may be organized
under the General Corporation Law of Delaware.
4. The total number of shares of stock which the corporation shall have
authority to issue is One Thousand (1,000) and the par value of each of such
shares is Ten Cents ($.10) amounting in the aggregate to One Hundred Dollars
($100.00).
5. The board of directors is authorized to make, alter or repeal the
by-laws of the corporation. Election of directors need not be by ballot.
6. The corporation reserves the right to amend, alter, change or repeal
any provision contained in this Certificate of Incorporation, in the manner now
or hereafter prescribed by the laws of Delaware, and all rights and powers
conferred herein upon stockholders and directors are granted subject to this
reservation.
<PAGE>
REC M145 PAGE 568
7. The names and mailing addresses of the persons who are to serve as
directors until the first annual meeting of the stockholders or until their
successors are elected and qualified are as follows
Names Mailing Addresses
----- -----------------
Sidney Epstein 2120 South 25th Avenue
Broadview, Illinois 60153
Peter P. Mazzetti 2120 South 25th Avenue
Broadview, Illinois 60153
Larry Stein 2120 South 25th Avenue
Broadview, Illinois 60153
8. (a) The Corporation shall indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Corporation) by reason of the
fact that he is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the Corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests or the Corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.
-2-
<PAGE>
REC M145 PAGE 569
(b) The Corporation shall indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Corporation to procure a judgment in
its favor by reason of the fact that he is or was a director, officer, employee
or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of the Corporation, and is
or was serving at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or settlement of such
action or suit if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the Corporation and except that
no indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the Corporation unless and only to
the extent that the Court of Chancery or the court in which such action or suit
was brought shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the Court of
Chancery or such other court shall deem proper.
(c) To the extent that a director, officer, employee or agent of the
Corporation has been successful on the merits or otherwise in defense of any
action, suit, or proceeding referred to in sections (a) and (b), or in defense
of any claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
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REC M145 PAGE 570
(d) Any indemnification under sections (a) and (b) (unless ordered
by a court) shall be made by the Corporation only as authorized in the specific
case upon a determination that indemnification of the director, officer,
employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in sections (a) and (b). Such
determination shall be made (1) by the Board of Directors by a majority vote of
a quorum consisting of directors who were not parties to such action, suit or
proceeding, or (2) if such a quorum is not obtainable, or, even if obtainable a
quorum of disinterested directors so directs, by independent legal counsel in a
written opinion, or (3) by the stockholders.
(e) Expenses incurred in defending a civil or criminal action, suit
or proceeding may be paid by the Corporation in advance of the final disposition
of such action, suit or proceeding as authorized by the Board of Directors in
the specific case upon receipt of an undertaking by or on behalf of the
director, officer, employee or agent to repay such amount unless it shall
ultimately be determined that he is entitled to be indemnified by the
Corporation as authorized in this Article.
(f) The indemnification provided by this Article shall not be deemed
exclusive of any other rights to which those seeking indemnification may be
entitled under any Bylaw, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall continue as to a
person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person.
(g) The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the Corporation, or is or was serving at the request of the Corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other
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REC M145 PAGE 571
enterprise against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the
Corporation would have the power to indemnify him against such liability under
the provisions of this Article.
(h) For purposes of this Bylaw, references to "the Corporation"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, and employees
or agent, so that any person who is or was a director, officer, employee or
agent of such constituent corporation, or is or was serving at the request of
such constituent corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
shall stand in the same position under this Bylaw with respect to the resulting
or surviving corporation as he would have with respect to such constituent
corporation if its separate existence had continued.
(i) For purposes of this Bylaw, references to 'other enterprises'
shall include employee benefit plans, references to 'fines' shall include any
excise taxes assessed on a person with respect to an employee benefit plan; and
references to 'serving at the request of the corporation' shall include any
service as a director, officer, employee or agent of the corporation which
imposes duties on, or involves services by, such director, officer, employee, or
agent with respect to an employee benefit plan, its participants, or
beneficiaries; and a person who acted in good faith and in a manner he
reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner 'not opposed to the best interests of the corporation' as referred to
in this Bylaw.
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REC M145 PAGE 572
9. The name and mailing address of the incorporator is
Richard V. Merrill
2120 South 25th Avenue
Broadview, Illinois 60153
I, THE UNDERSIGNED, being the incorporator hereinbefore named, for the
purpose of forming a corporation pursuant to the General Corporation Law of
Delaware, do make this certificate, hereby declaring and certifying that this is
my act and deed and the facts herein stated are true, and accordingly have
hereunto set my hand this 4th day of October, 1983.
/s/ Richard V. Merrill
----------------------
Richard V. Merrill
(2160L)
RECEIVED FOR RECORD
OCT 6 1983
LEO J. DUGAN, Jr., Recorder
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Exhibit 3.24
* * * * *
BY-LAWS
* * * * *
ARTICLE I
OFFICES
Section 1. The registered office shall be in the City of Wilmington,
County of New Castle, State of Delaware.
Section 2. The corporation may also have offices at such other
places both within and without the State of Delaware as the board of directors
may from time to time determine or the business of the corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. All meetings of the stockholders for the election of
directors shall be held in the City of Broadview, State of Illinois, at such
place as may be fixed from time to time by the board of directors, or at such
other place either within or without the State of Delaware as shall be
designated from time to time by the board of directors and stated in the notice
of the meeting. Meetings of stockholders for any other purpose may be held at
such time and place, within or without the State of Delaware, as shall be stated
in the notice of the meeting or in a duly executed waiver of notice thereof.
Section 2. Annual meetings of stockholders for the election of
directors and for the transaction of such other business as may properly be
brought before the meeting shall be held at such date and time in each year as
may be designated from time to time by the board of Directors.
Section 3. Written notice of the annual meeting stating the place,
date and hour of the meeting shall be given to each stockholder entitled to vote
at such meeting not less than ten nor more than sixty days before the date of
the meeting.
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Section 4. The officer who has charge of the stock ledger of the
corporation shall prepare and make, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
ten days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder who is
present.
Section 5. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the certificate of
incorporation, may be called by the president and shall be called by the
president or secretary at the request in writing of a majority of the board of
directors, or at the request in writing of stockholders owning a majority in
amount of the entire capital stock of the corporation issued and outstanding and
entitled to vote. Such request shall state the purpose or purposes of the
proposed meeting.
Section 6. Written notice of a special meeting stating the place,
date and hour of the meeting and the purpose or purposes for which the meeting
is called, shall be given not less than ten nor more than sixty days before the
date of the meeting, to each stockholder entitled to vote at such meeting.
Section 7. Business transacted at any special meeting of
stockholders shall be limited to the purposes stated in the notice.
Section 8. The holders of one-fourth of the stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall constitute a quorum at all meetings of the stockholders for the
transaction of business except as otherwise provided by statute or by the
certificate of incorporation. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders entitled to
vote thereat, present in
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person or represented by proxy, shall have power to adjourn the meeting from
time to time, without notice other than announcement at the meeting, until a
quorum shall be present or represented. At such adjourned meeting at which a
quorum shall be present or represented any business may be transacted which
might have been transacted at the meeting as originally notified. If the
adjournment is for more than thirty days, or if after the adjournment a new
record date is fixed for the adjourned meeting, a notice of the adjourned
meeting shall be given to each stockholder of record entitled to vote at the
meeting.
Section 9. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which by express provision of the statutes or of
the certificate of incorporation, a different vote is required in which case
such express provision shall govern and control the decision of such question.
Section 10. Unless otherwise provided in the certificate of
incorporation each stockholder shall at every meeting of the stockholders be
entitled to one vote in person or by proxy for each share of the capital stock
having voting power held by such stockholder, but no proxy shall be voted on
after three years from its date, unless the proxy provides for a longer period.
Section 11. Unless otherwise provided in the certificate of
incorporation, any action required to be taken at any annual or special meeting
of stockholders of the corporation, or any action which may be taken at any
annual or special meeting of such stockholders, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of outstanding stock having
not less than the minimum number of votes that would be necessary to authorize
or take such action at a meeting at which all shares entitled to vote thereon
where present and voted. Prompt notice of the taking of the corporate action
without a meeting by less than unanimous written consent shall be given to those
stockholders who have not consented in writing.
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ARTICLE III
DIRECTORS
Section 1. The number of directors which shall constitute the whole
board shall be not less than three nor more than twenty. The first board shall
consist of five directors. Thereafter, within the limits above specified, the
number of directors shall be determined by resolution of the board of directors
or by the stockholders at the annual meeting. The directors shall be elected at
the annual meeting of the stockholders, except as provided in Section 2 of this
Article, and each director elected shall hold office until his successor is
elected and qualified. Directors need not be stockholders.
Section 2. Vacancies and newly created directorships resulting from
any increase in the authorized number of directors may be filled by a majority
of the directors then in office, though less than a quorum, or by a sole
remaining director, and the directors so chosen shall hold office until the next
annual election and until their successors are duly elected and shall qualify,
unless sooner displaced. If there are no directors in office, then an election
of directors may be held in the manner provided by statute.
Section 3. The business of the corporation shall be managed by or
under the direction of its board of directors which may exercise all such powers
of the corporation and do all such lawful acts and things as are not by statute
or by the certificate of incorporation or by these by-laws directed or required
to be exercised or done by the stockholders.
MEETINGS OF THE BOARD OF DIRECTORS
Section 4. The board of directors of the corporation may hold
meetings, both regular and special, either within or without the State of
Delaware.
Section 5. The first meeting of each newly elected board of
directors shall be held at such time and place as shall be fixed by the vote of
the stockholders at the annual meeting and no notice of such meeting shall be
necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present. In the event of the failure of the
stockholders to fix the time or place of
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such first meeting of the newly elected board of directors, or in the event such
meeting is not held at the time and place so fixed by the stockholders, the
meeting may be held at such time and place as shall be specified in a notice
given as hereinafter provided for special meetings of the board of directors, or
as shall be specified in a written waiver signed by all of the directors.
Section 6. Regular meetings of the board of directors may be held
without notice at such time and at such place as shall from time to time be
determined by the board.
Section 7. Special meetings of the board may be called by the
president on two days' notice to each director, either personally or by mail or
by telegram; special meetings shall be called by the president or secretary in
like manner and on like notice on the written request of two directors unless
the board consists of only one director; in which case special meetings shall be
called by the president or secretary in like manner and on like notice on the
written request of the sole director.
Section 8. At all meetings of the board one-third of the directors
then in office shall constitute a quorum for the transaction of business and the
act of a majority of the directors present at any meeting at which there is a
quorum shall be the act of the board of directors, except as may be otherwise
specifically provided by statute or by the certificate of incorporation. If a
quorum shall not be present at any meeting of the board of directors the
directors present thereat may adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum shall be present.
Section 9. Unless otherwise restricted by the certificate of
incorporation or these by-laws, any action required or permitted to be taken at
any meeting of the board of directors or of any committee thereof may be taken
without a meeting, if all members of the board or committee, as the case may be,
consent thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the board or committee.
Section 10. Unless otherwise restricted by the certificate of
incorporation or these by-laws, members of the board of directors, or any
committee designated by the board of directors, may participate in a meeting of
the board of
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directors, or any committee, by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.
COMMITTEES OF DIRECTORS
Section 11. The board of directors may, by resolution passed by a
majority of the whole board, designate one or more committees, each committee to
consist of one or more of the directors of the corporation. The board may
designate one or more directors as alternate members of any committee, who may
replace any absent or disqualified member at any meeting of the committee.
In the absence or disqualification of a member of committee, the
member or members thereof present at any meeting and not disqualified from
voting, whether or not he or they constitute a quorum, may unanimously appoint
another member of the board of directors to act at the meeting in the place of
any such absent or disqualified member.
Any such committee, to the extent provided in the resolution of the
board of directors, shall have and may exercise all the powers and authority of
the board of directors in the management of the business and affairs of the
corporation, and may authorize the seal of the corporation to be affixed to all
papers which may require it; but no such committee shall have the power or
authority in reference to amending the certificate of incorporation, adopting an
agreement of merger or consolidation, recommending to the stockholders the sale,
lease or exchange of all or substantially all of the corporation's property and
assets, recommending to the stockholders a dissolution of the corporation or a
revocation of a dissolution, or amending the by-laws of the corporation; and,
unless the resolution or the certificate of incorporation expressly so provide,
no such committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock. Such committee or committees shall have such
name or names as may be determined from time to time by resolution adopted by
the board of directors.
Section 12. Each committee shall keep regular minutes of its
meetings and report the same to the board of directors when required.
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COMPENSATION OF DIRECTORS
Section 13. The board of directors shall serve without compensation.
The directors may be paid their expenses, if any, of attendance at each meeting
of the board of directors.
REMOVAL OF DIRECTORS
Section 14. Unless otherwise restricted by the certificate of
incorporation or bylaw, any director or the entire board of directors may be
removed, with or without cause, by the holders of a majority of shares entitled
to vote at an election of directors.
ARTICLE IV
NOTICES
Section 1. Whenever, under the provisions of the statutes or of the
certificate of incorporation or of these by-laws, notice is required to be given
to any director or stockholder, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
director or stockholder, at his address as it appears on the records of the
corporation, with postage thereon prepaid, and such notice shall be deemed to be
given at the time when the same shall be deposited in the United States mail.
Notice to directors may also be given by telegram.
Section 2. Whenever any notice is required to be given under the
provisions of the statutes or of the certificate of incorporation or of these
by-laws, a waiver thereof in writing, signed by the person or persons entitled
to said notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
ARTICLE V
OFFICERS
Section 1. The officers of the corporation shall be chosen by the
board of directors and shall be a president, a vice-president, a secretary and a
treasurer. The board of directors may also choose additional vice-presidents,
and one or more
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assistant secretaries and assistant treasurers. Any number of offices may be
held by the same person, unless the certificate of incorporation or these
by-laws otherwise provide.
Section 2. The board of directors at its first meeting after each
annual meeting of stockholders shall choose a president, one or more
vice-presidents, a secretary and a treasurer.
Section 3. The board of directors may appoint such other officers
and agents as it shall deem necessary who shall hold their offices for such
terms and shall exercise such powers and perform such duties as shall be
determined from time to time by the board.
Section 4. The salaries of all officers and agents of the
corporation shall be fixed by the board of directors.
Section 5. The officers of the corporation shall hold office until
their successors are chosen and qualify. Any officer elected or appointed by the
board of directors may be removed at any time by the affirmative vote of a
majority of the board of directors. Any vacancy occurring in any office of the
corporation shall be filled by the board of directors.
THE PRESIDENT
Section 6. The president shall be the chief executive officer of the
corporation, shall preside at all meetings of the stockholders and the board of
directors, shall have general and active management of the business of the
corporation and shall see that all orders and resolutions of the board of
directors are carried into effect.
Section 7. He shall execute bonds, mortgages and other contracts
requiring a seal, under the seal of the corporation, except where required or
permitted by law to be otherwise signed and executed and except where the
signing and execution thereof shall be expressly delegated by the board of
directors to some other officer or agent of the corporation.
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THE VICE-PRESIDENTS
Section 8. In the absence of the president or in the event of his
inability or refusal to act, the vice-president (or in the event there be more
than one vice-president, the vice-presidents in the order designated by the
directors, or in the absence of any designation, then in the order of their
election) shall perform the duties of the president, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the
president. The vice-presidents shall perform such other duties and have such
other powers as the board of directors may from time to time prescribe.
THE SECRETARY AND ASSISTANT SECRETARY
Section 9. The secretary shall attend all meetings of the board of
directors and all meetings of the stockholders and record all the proceedings of
the meetings of the corporation and of the board of directors in a book to be
kept for that purpose and shall perform like duties for the standing committees
when required. He shall give, or cause to be given, notice of all meetings of
the stockholders and special meetings of the board of directors, and shall
perform such other duties as may be prescribed by the board of directors or
president, under whose supervision he shall be. He shall have custody of the
corporate seal of the corporation and he, or an assistant secretary, shall have
authority to affix the same to any instrument requiring it and when so affixed,
it may be attested by his signature or by the signature of such assistant
secretary. The board of directors may give general authority to any other
officer to affix the seal of the corporation and to attest the affixing by his
signature.
Section 10. The assistant secretary, or if there be more than one,
the assistant secretaries in the order determined by the board of directors (or
if there be no such determination, then in the order of their election) shall,
in the absence of the secretary or in the event of his inability or refusal to
act, perform the duties and exercise the powers of the secretary and shall
perform such other duties and have such other powers as the board of directors
may from time to time prescribe.
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THE TREASURER AND ASSISTANT TREASURERS
Section 11. The treasurer shall have the custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the board of directors.
Section 12. He shall disburse the funds of the corporation as may be
ordered by the board of directors, taking proper vouchers for such
disbursements, and shall render to the president and the board of directors, at
its regular meetings, or when the board of directors so requires, an account of
all his transactions as treasurer and of the financial condition of the
corporation.
Section 13. If required by the board of directors, he shall give the
corporation a bond (which shall be renewed every six years) in such sum and with
such surety or sureties as shall be satisfactory to the board of directors for
the faithful performance of the duties of his office and for the restoration to
the corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of whatever
kind in his possession or under his control belonging to the corporation.
Section 14. The assistant treasurer, or if there shall be more than
one, the assistant treasurers in the order determined by the board of directors
(or if there be no such determination, then in the order of their election),
shall, in the absence of the treasurer or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the treasurer and
shall perform such other duties and have such other powers as the board of
directors may from time to time prescribe.
ARTICLE VI
CERTIFICATE OF STOCK
Section 1. Every holder of stock in the corporation shall be
entitled to have a certificate, signed by, or in the name of the corporation by,
the chairman or vice-chairman of the board of directors, or the president or a
vice-president and the treasurer or an assistant treasurer, or the secretary or
an assistant secretary of the corporation, certifying the number of shares owned
by him in the corporation.
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Certificates may be issued for partly paid shares and in such case
upon the face or back of the certificates issued to represent any such partly
paid shares, the total amount of the consideration to be paid therefor, and the
amount paid thereon shall be specified.
If the corporation shall be authorized to issue more than one class
of stock or more than one series of any class, the powers, designations,
preferences and relative, participating, optional or other special rights of
each class of stock or series thereof and the qualification, limitations or
restrictions of such preferences and/or rights shall be set forth in full or
summarized on the face or back of the certificate which the corporation shall
issue to represent such class or series of stock, provided that, except as
otherwise provided in section 202 of the General Corporation Law of Delaware, in
lieu of the foregoing requirements, there may be set forth on the face or back
of the certificate which the corporation shall issue to represent such class or
series of stock, a statement that the corporation will furnish without charge to
each stockholder who so requests the powers, designations, preferences and
relative, participating, optional or other special rights of each class of stock
or series thereof and the qualifications, limitations or restrictions of such
preferences and/or rights.
Section 2. Any of or all the signatures on the certificate may be
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the corporation with the same effect as if he were
such officer, transfer agent or registrar at the date of issue.
LOST CERTIFICATES
Section 3. The board of directors may direct a new certificate or
certificates to be issued in place of any certificate or certificates
theretofore issued by the corporation alleged to have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming
the certificate of stock to be lost, stolen or destroyed. When authorizing such
issue of a new certificate or certificates, the board of directors may, in its
discretion and as a condition precedent to the issuance thereof, require the
owner of such lost, stolen or destroyed certificate or certificates, or his
legal representative, to advertise the same in such manner as it
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shall require and/or to give the corporation a bond in such sum as it may direct
as indemnity against any claim that may be made against the corporation with
respect to the certificate alleged to have been lost, stolen or destroyed.
TRANSFER OF STOCK
Section 4. Upon surrender to the corporation or the transfer agent
of the corporation of a certificate for shares duly endorsed or accompanied by
proper evidence of succession, assignation or authority to transfer, it shall be
the duty of the corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
FIXING RECORD DATE
Section 5. In order that the corporation may determine the
stockholders entitled to notice of or to vote at any meeting of stockholders or
any adjournment thereof, or the express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock or for the purpose of any
other lawful action, the board of directors may fix, in advance, a record date,
which shall not be more than sixty nor less than ten days before the date of
such meeting, nor more than sixty days prior to any other action. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting: provided,
however, that the board of directors may fix a new record date for the adjourned
meeting.
REGISTERED STOCKHOLDERS
Section 6. The corporation shall be entitled to recognize the
exclusive right of a person registered on its books as the owner of shares to
receive dividends, and to vote as such owner, and to hold liable for calls and
assessments a person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or other claim to or interest in such
share or shares on the part of any other person, whether or not it shall have
express or other notice thereof, except as otherwise provided by the laws of
Delaware.
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ARTICLE VII
GENERAL PROVISIONS
DIVIDENDS
Section 1. Dividends upon the capital stock of the corporation,
subject to the provisions of the certificate of incorporation, if any, may be
declared by the board of directors at any regular or special meeting, pursuant
to law. Dividends may be paid in cash, in property, or in shares of the capital
stock, subject to the provisions of the certificate of incorporation.
Section 2. Before payment of any dividend, there may be set aside
out of any funds of the corporation available for dividends such sum or sums as
the directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or for such other
purpose as the directors shall think conducive to the interest of the
corporation, and the directors may modify or abolish any such reserve in the
manner in which it was created.
ANNUAL STATEMENT
Section 3. The board of directors shall present at each annual
meeting, and at any special meeting of the stockholders when called for by vote
of the stockholders, a full and clear statement of the business and condition of
the corporation.
CHECKS
Section 4. All checks or demands for money and notes of the
corporation shall be signed by such officer or officers or such other person or
persons as the board of directors may from time to time designate.
FISCAL YEAR
Section 5. The fiscal year of the corporation shall be the calendar
year, unless otherwise fixed by resolution of the board of directors.
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SEAL
Section 6. The corporate seal shall have inscribed thereon the name
of the corporation, the year of its organization and the words "Corporate Seal,
Delaware". The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
INDEMNIFICATION
Section 7. The corporation shall indemnify its officers, directors,
employees and agents to the extent permitted by the General Corporation Law of
Delaware.
ARTICLE VIII
AMENDMENTS
Section 1. These by-laws may be altered, amended or repealed or new
by-laws may be adopted by the stockholders or by the board of directors, when
such power is conferred upon the board of directors by the certificate of
incorporation at any regular meeting of the stockholders or of the board of
directors or at any special meeting of the stockholders or of the board of
directors if notice of such alteration, amendment, repeal or adoption of new
by-laws be contained in the notice of such special meeting. If the power to
adopt, amend or repeal by-laws is conferred upon the board of directors by the
certificate of incorporation it shall not divest or limit the power of the
stockholders to adopt, amend or repeal by-laws.
- 14 -
<PAGE>
Exhibit 3.25
State of Delaware
PAGE 1
Office of the Secretary of State
--------------------------------
I, WILLIAM T. QUILLEN, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
AMENDMENT OF "ALLIED FREIGHT FORWARDING, INCORPORATED" FILED IN THIS OFFICE ON
THE SECOND DAY OF JULY, A.D. 1993, AT 9 O'CLOCK A.M.
A CERTIFIED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO NEW CASTLE
COUNTY RECORDER OF DEEDS ON THE TWENTY-THIRD DAY OF AUGUST, A.D. 1993 FOR
RECORDING.
* * * * * * * * * *
[SEAL]
/s/ William T. Quillen
----------------------------------------
William T. Quillen, Secretary of State
AUTHENTICATION.* 4027222
931875414 DATE: 08/23/1993
<PAGE>
STATE 0F DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:00 AM 07/02/1993
931875414 - 520827
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
ALLIED FREIGHT FORWARDING, INCORPORATED, a corporation organized and
existing under and by virtue of the General Corporation Law of the State of
Delaware, (the "Corporation")
DOES HEREBY CERTIFY:
FIRST: That the Board of Directors of the Corporation, by the unanimous
written consent of its members, filed with the minutes of the board, adopted a
resolution proposing and declaring advisable the following amendment to the
Certificate of Incorporation of the Corporation:
RESOLVED, that the Certificate of Incorporation of Allied Freight
Forwarding, Incorporated be amended by changing the First Article thereof
so that, as amended, said Article shall be and read as follows:
"1. The name of the Corporation is:
Allied Freight Forwarding, Inc."
SECOND: That in lieu of a meeting and vote of stockholders, the
stockholders have given unanimous written consent to said amendment in
accordance with the provisions of Section 228 of the General Corporation Law of
the State of Delaware.
THIRD: That the aforesaid amendment was duly adopted in accordance with
the applicable provisions of Sections 242 and 228 of the General Corporation Law
of the State of Delaware.
<PAGE>
IN WITNESS WHEREOF, said Corporation has caused this certificate to be
signed by Michael P. Fergus, its Vice President, and attested by Richard V.
Merrill, its Assistant Secretary, this 28th day of May, 1993.
ALLIED FREIGHT FORWARDING, INCORPORATED
By /s/ Michael P. Fergus
------------------------------------
Michael P. Fergus, Vice President
ATTEST:
By /s/ Richard V. Merrill
-------------------------
Richard V. Merrill
Assistant Secretary
0089/MIN/rm
<PAGE>
State of Delaware }
} ss.
New Castle County }
I, Leo J. Dugan, Jr., Recorder of Deeds for New Castle County,
Delaware, do hereby certify that Certified Copy of Certificate of Amendment of
"ALLIED VAN LINES INTERNATIONAL CORPORATION"
was received for record in this office on November 29, 1976 and the same appears
of record in the Recorder's Office for said County.
Witness my hand and Official Seal, this twenty-ninth day of November A.D.
1976
/s/ Leo J. Dugan Jr.
--------------------
Recorder.
<PAGE>
[STATE CREST]
State
of
DELAWARE
[GRAPHIC OMITTED]
Office of SECRETARY OF STATE
I, Robert H. Reed, Secretary of State of the State of Delaware, do hereby
certify that the above and foregoing is a true and correct copy of Certificate
of Amendment of the "ALLIED VAN LINES INTERNATIONAL CORPORATION", as received
and filed in this office the twenty-ninth day of November, A.D. 1976, at 10
o'clock A.M.
In Testimony Whereof, I have hereunto set my hand and official seal
at Dover this twenty-ninth day of November in the year of our Lord
one thousand nine hundred and seventy-six.
[STATE SEAL] /s/ Robert H. Reed
----------------------------------------------
Robert H. Reed Secretary of State
/s/ Grover A. Biddle
----------------------------------------------
Grover A. Biddle Assistant Secretary of State
REC'D FOR RECORD NOV 29 1976 LEO J. DUGAN, Jr. Recorder
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
* * * * *
ALLIED VAN LINES INTERNATIONAL CORPORATION, a corporation organized
and existing under and by virtue of the General Corporation Law of the State of
Delaware, DOES HEREBY CERTIFY.
FIRST: That the Board of Directors of said corporation, by the
unanimous written consent of its members, filed with the minutes of the board,
adopted a resolution proposing and declaring advisable the following amendment
to the Certificate of Incorporation of said corporation:
RESOLVED, that the Certificate of Incorporation of ALLIED VAN LINES
INTERNATIONAL CORPORATION be amended by changing the Article thereof
numbered "First" so that, as amended, said Article shall be and read
as follows:
"FIRST: The name of the corporation is ALLIED FREIGHT FORWARDING,
INCORPORATED."
SECOND: That in lieu of a meeting and vote of stockholders, the
stockholders have given unanimous written consent to said amendment in
accordance with the provisions of Section 228 of The General Corporation Law of
the State of Delaware.
THIRD: That the aforesaid amendment was duly adopted in accordance
with the applicable provisions of Sections 242 and 228 of The General
Corporation Law of the State of Delaware.
<PAGE>
IN WITNESS WHEREOF, said ALLIED VAN LINES INTERNATIONAL
CORPORATION has caused this certificate to be signed by Robert S. Seeler, its
Vice President and attested by Terry Fewell, its Assistant Secretary, this 19th
day of November, 1976.
ALLIED VAN LINES INTERNATIONAL
CORPORATION
By /s/ Robert S. Seeler
-----------------------
Robert S. Seeler
Vice President
ATTEST:
By /s/ Terry G. Fewell
----------------------
Terry G. Fewell
Assistant Secretary
<PAGE>
State of Delaware
[STATE CREST]
Office of Secretary of State.
I, Elisha C. Dukes, Secretary of State of the State of Delaware, do hereby
certify that the above and foregoing is true and correct copy of Certificate of
Amendment of Certificate of Incorporation of the "ALLIED SEA VAN COMPANY", as
received and filed in this office the seventh day of March, A.D. 1966, at 9
o'clock A.M.
In Testimony Whereof, I have hereunto set my hand and official seal
at Dover this seventh day of March in the year of our Lord one
thousand nine hundred and sixty-six.
[STATE SEAL] /s/ Elisha C. Dukes
---------------------------
Secretary of State
/s/ [ILLEGIBLE]
---------------------------
Ass't Secretary of State
REC'D FOR RECORD Mar 14 1966 LEO J. DUGAN, Jr. RECORDER
<PAGE>
ALLIED SEA VAN COMPANY
CERTIFICATE OF AMENDMENT
STATE OF ILLINOIS )
) ss.
COUNTY OF COOK )
We, Ralph Rolapp, President, and John F. Christie, Jr., Secretary of the
Allied Sea Van Company, a corporation organized and existing under and by virtue
of the laws of the State of Delaware, do hereby certify as follows:
l. On February 17, 1958, there was issued by the Secretary of State of
Delaware a certificate of incorporation constituting and creating Allied
Sea Van Company a corporation under the laws of the State of Delaware with
its principal place of business in the City of Wilmington, County of New
Castle, State of Delaware.
2. The aforesaid certificate of incorporation, dated November 17, 1958, as
amended, authorized a common stock of one thousand (1,000) shares of the
par value of Five Dollars ($5.00) each, amounting in the aggregate to Five
Thousand Dollars ($5,000.00).
3. On the 2nd day of February, 1966, the Board of Directors of this
corporation, with the unanimous consent of its shareholders, adopted a
resolution proposing and authorizing an amendment to the aforesaid
certificate of incorporation, to wit:
FIRST: The name of the corporation is ALLIED VAN LINES INTERNATIONAL
CORPORATION.
FOURTH: The total number of shares of stock which the corporation
shall have the authority to issue is twenty thousand (20,000) of the
par value of Five Dollars ($5.00) each, amounting in the aggregate
to One Hundred Thousand Dollars ($100,000.00).
<PAGE>
4. The capital of this corporation will not be reduced under or by reason
of the amendment.
5. Said amendment to the certificate of incorporation was duly adopted by
the Board of Directors of this corporation pursuant to and in accordance
with the provisions of Sec. 242 of Title 8 of the Delaware Code.
IN WITNESS WHEREOF, said Ralph Rolapp, President, and said John F.
Christie, Jr., Secretary, of the Allied Sea Van Company, have signed this
certificate and caused the corporate seal of said company to be affixed this
23rd day of February, 1966.
ALLIED SEA VAN COMPANY
By: /s/ Ralph Rolapp
-------------------------
Its President
By: /s/ John F. Christie
-------------------------
Its Secretary
STATE OF ILLINOIS )
) ss.
COUNTY OF COOK )
Ralph Rolapp, being first duly sworn, on oath deposes and says that he is the
President of Allied Sea Van Company; that he has signed the foregoing
Certificate of Amendment and that those matters and representations contained in
said Certificate are true.
/s/ Ralph Rolapp
-------------------------
Ralph Rolapp
SUBSCRIBED AND SWORN TO BEFORE ME
THIS 23rd DAY OF February 1966.
/s/ [ILLEGIBLE]
- ---------------------------------
Notary Public
<PAGE>
[STATE CREST]
State
of
DELAWARE
[STATE CREST]
Office of SECRETARY OF STATE
I, John N. McDowell, Secretary of State of the State of Delaware, do
hereby certify that the above and foregoing is a true and correct copy of
Certificate of Incorporation of the "ALLIED SEA VAN COMPANY", as received and
filed in this office the seventeenth day of February, A.D. 1958, at 10 o'clock
A.M.
In Testimony Whereof, I have hereunto set my hand and official seal
at Dover this seventeenth day of February in the year of our Lord
one thousand nine hundred and fifty-eight.
[STAE SEAL] /s/ John N. McDowell
----------------------------------------------
Secretary of State
/s/ MD Tomlinson
----------------------------------------------
Ass't. Secretary of State
REC'D FOR RECORD FEB 17 1958 EDWARD R. HENSEL, RECORDER
<PAGE>
CERTIFICATE OF INCORPORATION
OF
ALLIED SEA VAN COMPANY
-o-O-o-
FIRST. The name of the corporation is
ALLIED SEA VAN COMPANY
SECOND. Its principal office in the State of Delaware is located at
No. 100 West Tenth Street, in the City of Wilmington 99, County of New Castle.
The name and address of its resident agent is The Corporation Trust Company, No.
100 West Tenth Street, Wilmington 99, Delaware.
THIRD. The nature of the business, or objects or purposes to be
transacted, promoted or carried on are:
To engage directly or indirectly in the transportation of household
goods, and in all activities incidental to such transportation business,
including port handling operations in the United States and abroad.
To arrange with other firms for ocean shipments, land
transportation, and for all accessorial services in connection therewith.
To manufacture, purchase or otherwise acquire, invest in, own,
mortgage, pledge, sell, assign and transfer or otherwise dispose of, trade, deal
in and deal with goods, wares and merchandise and personal property of every
class and description.
<PAGE>
To acquire, and pay for in cash, stock or bonds of this corporation
or otherwise, the good will, rights, assets and property, and to undertake or
assume the whole or any part of the obligations or liabilities of any person,
firm, association or corporation.
To acquire, hold, use, sell, assign, lease, grant licenses in
respect of, mortgage or otherwise dispose of letters patent of the United States
or any foreign country, patent rights, licenses and privileges, inventions,
improvements and processes, copyrights, trade-marks and trade names, relating to
or useful in connection with any business of this corporation.
To acquire by purchase, subscription or otherwise, and to receive,
hold, own, guarantee, sell, assign, exchange, transfer, mortgage, pledge or
otherwise dispose of or deal in and with any of the shares of the capital stock,
or any voting trust certificates in respect of the shares of capital stock,
scrip, warrants, rights, bonds, debentures, notes, trust receipts, and other
securities, obligations, choses in action and evidences of indebtedness or
interest issued or created by any corporations, joint stock companies,
syndicates, associations, firms, trusts or persons, public or private, or by the
government of the United States of America, or by any foreign government, or by
any state, territory, province, municipality or other political subdivision or
by any governmental agency, and as owner thereof to possess and exercise all the
rights, powers and privileges of ownership, including the right to execute
consents and
<PAGE>
vote thereon, and to do any and all acts and things necessary or advisable for
the preservation, protection, improvement and enhancement in value thereof.
To enter into, make and perform contracts of every kind and
description with any person, firm, association, corporation, municipality,
county, state, body politic or government or colony or dependency thereof.
To borrow or raise moneys for any of the purposes of the corporation
and, from time to time without limit as to amount, to draw, make, accept,
endorse, execute and issue promissory notes, drafts, bills of exchange,
warrants, bonds, debentures and other negotiable or non-negotiable instruments
and evidences of indebtedness, and to secure the payment of any thereof and of
the interest thereon by mortgage upon or pledge, conveyance or assignment in
trust of the whole or any part of the property of the corporation, whether at
the time owned or thereafter acquired, and to sell, pledge or otherwise dispose
of such bonds or other obligations of the corporation for its corporate
purposes.
To loan to any person, firm or corporation any of its surplus funds,
either with or without security.
To purchase, hold, sell and transfer the shares of its own capital
stock; provided it shall not use its funds or property for the purchase of its
own shares of capital stock when such use would cause any impairment of its
capital except as otherwise permitted by law, and provided further that shares
of its own capital stock belonging to it shall not be voted upon directly or
indirectly.
<PAGE>
To have one or more offices, to carry on all or any of its
operations and business and without restriction or limit as to amount to
purchase or otherwise acquire, hold, own, mortgage, sell, convey or otherwise
dispose of, real and personal property of every class and description in any of
the states, districts, territories or colonies of the United States, and in any
and all foreign countries, subject to the laws of such state, district,
territory, colony or country.
In general, to carry on any other business in connection with the
foregoing, and to have and exercise all the powers conferred by the laws of
Delaware upon corporations formed under the General Corporation Law of the State
of Delaware, and to do any or all of the things hereinbefore set forth to the
same extent as natural Persons might or could do.
The objects and purposes specified in the foregoing clauses shall,
except where otherwise expressed, be in nowise limited or restricted by
reference to, or inference from, the terms of any other clause in this
certificate of incorporation, but the objects and purposes specified in each of
the foregoing clauses of this article shall be regarded as independent objects
and purposes.
FOURTH. The total number of shares of stock which the corporation
shall have authority to issue is one thousand (1,000) and the par value of each
of such shares is Five Dollars ($5.00), amounting in the aggregate to Five
Thousand Dollars ($5,000.00).
<PAGE>
FIFTH. The minimum amount of capital with which the corporation will
commence business is One Thousand Dollars ($1,000.00).
SIXTH. The names and places of residence of the incorporators are as
follows:
NAMES RESIDENCES
----- ----------
H. K. Webb Wilmington, Delaware
H. C. Broadt Wilmington, Delaware
A. D. Atwell Wilmington, Delaware
SEVENTH. The corporation is to have perpetual existence.
EIGHTH. The private property of the stockholders shall not be
subject to the payment of corporate debts to any extent whatever.
NINTH. In furtherance and not in limitation of the powers conferred
by statute, the board of directors is expressly authorized:
To make, alter or repeal the by-laws of the corporation.
To authorize and cause to be executed mortgages and liens upon the
real and personal property of the corporation.
To set apart out of any of the funds of the corporation available
for dividends a reserve or reserves for any proper purpose and to abolish any
such reserve in the manner in which it was created.
<PAGE>
By resolution passed by a majority of the whole board, to designate
one or more committees, each committee to consist of two or more of the
directors of the corporation, which, to the extent provided in the resolution or
in the by-laws of the corporation, shall have and may exercise the powers of the
board of directors in the management of the business and affairs of the
corporation, and may authorize the seal of the corporation to be affixed to all
papers which may require it. Such committee or committees shall have such name
or names as may be stated in the by-laws of the corporation or as may be
determined from time to time by resolution adopted by the board of directors.
When and as authorized by the affirmative vote of the holders of a
majority of the stock issued and outstanding having voting power given at a
stockholders' meeting duly called for that purpose, or when authorized by the
written consent of the holders of a majority of the voting stock issued and
outstanding, to sell, lease or exchange all of the property and assets of the
corporation, including its good will and its corporate franchises, upon such
terms and conditions and for such consideration, which may be in whole or in
part shares of stock in, and/or other securities of, any other corporation or
corporations, as its board of directors shall deem expedient and for the best
interests of the corporation.
TENTH. Whenever a compromise or arrangement is proposed between this
corporation and its creditors or any class of them and/or between this
corporation and its stock-
<PAGE>
holders or any class of them, any court of equitable jurisdiction within the
State of Delaware may, on the application in a summary way of this corporation
or of any creditor or stockholder thereof, or on the application of any receiver
or receivers appointed for this corporation under the provisions of section 291
of Title 8 of the Delaware Code, or on the application of trustees in
dissolution or of any receiver or receivers appointed for this corporation under
the provisions of section 279 of Title 8 of the Delaware Code, order a meeting
of the creditors or class of creditors, and/or of the stockholders or class of
stockholders of this corporation, as the case may be, to be summoned in such
manner as the said court directs. If a majority in number representing
three-fourths in value of the creditors or class of creditors, and/or of the
stockholders or class of stockholders of this corporation, as the case may be,
agree to any compromise or arrangement and to any reorganization of this
corporation as consequence of such compromise or arrangement, the said
compromise or arrangement and the said reorganization shall, if sanctioned by
the court to which the said application has been made, be binding on all the
creditors or class of creditors, and/or on all the stockholders or class of
stockholders, of this corporation, as the case may be, and also on this
corporation.
ELEVENTH. Meetings of stockholders may be held outside the State of
Delaware, if the by-laws so provide. The books of the corporation may be kept
(subject to any provision contained in the statutes) outside the State of
<PAGE>
Delaware at such place or places as may be designated from time to time by the
board of directors or in the by-laws of the corporation. Elections of directors
need not be by ballot unless the by-laws of the corporation shall so provide.
TWELFTH. The corporation reserves the right to amend, alter, change
or repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
WE, THE UNDERSIGNED, being each of the incorporators hereinbefore
named, for the purpose of forming a corporation pursuant to the General
Corporation Law of the State of Delaware, do make this certificate, hereby
declaring and certifying that the facts herein stated are true, and accordingly
have hereunto set our hands and seals this 3rd day December A. D. 1957.
H.K. Webb (SEAL)
------------------------------
H.C. Broadt (SEAL)
------------------------------
A.D. Atwell (SEAL)
------------------------------
<PAGE>
STATE OF DELAWARE )
) ss:
COUNTY OF NEW CASTLE )
BE IT REMEMBERED that on this 3rd day of December A.D. 1957,
personally came before me, a Notary Public for the State of Delaware, H. K.
Webb, H. C. Broadt and A. D. Atwell, all of the parties to the foregoing
certificate of incorporation, known to me personally to be such, and severally
acknowledged the said certificate to be the act and deed of the signers
respectively and that the facts therein stated are truly set forth.
GIVEN under my hand and seal of office the day and year aforesaid.
M. Ruth Mannering
--------------------------------
M. Ruth Mannering Notary Public.
Notary Public
Appointed Feb. 12, 1957
State of Delaware
Term Two Years
<PAGE>
Exhibit 3.26
RESTATED BYLAWS OF
ALLIED VAN LINES INTERNATIONAL CORPORATION
AS OF MAY 8, 1976
ARTICLE 1
OFFICES
1.1 The principal office shall be in the City of Wilmington, County
of New Castle, State of Delaware. The corporation may also have offices at such
other places as the board of directors may from time to time determine or the
business of the corporation may require.
ARTICLE 2
STOCKHOLDERS' MEETINGS
2.1 Annual Meeting. The annual meeting of stockholders entitled to
vote shall be held in the State of Delaware or elsewhere and at such time and
place as may be determined by the board of directors from time to time but not
less than sixty (60) days prior to the date set for such meeting. At the annual
meeting the stockholders shall elect the board of directors by a plurality vote
and transact such other business as may properly be brought before the meeting.
Written notice of the annual meeting shall be served upon or mailed to each
stockholder entitled to vote thereat at such address as appears on the books of
the corporation, at least twenty (20) days prior to the meeting.
<PAGE>
2.2 Special Meetings. Special meetings of the stockholders, for any
purpose or purposes, unless otherwise prescribed by statute or by the
certificate of incorporation, may be called by the president and shall be called
by the president or secretary at the request in writing of a majority of the
board of directors, or at the request in writing of stockholders owning a
majority in amount of the entire capital stock of the corporation issued and
outstanding and entitled to vote. Such request shall state the purpose or
purposes of the proposed meeting. Written notice of a special meeting of
stockholders, stating the time and place and object thereof, shall be served
upon or mailed to each stockholder entitled to vote thereat at such address as
appears on the books of the corporation, at least ten (10) days before such
meeting. Business transacted at all special meetings shall be confined to the
objects stated in the call.
2.3 Quorum. The holders of a majority of the stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall be requisite and shall constitute a quorum at all meetings of the
stockholders for the transaction of business except as otherwise provided by
statute, by the certificate of incorporation or by these by-laws. If, however,
such quorum shall not be present or represented at any meeting of the stock-
holders, the stockholders entitled to vote thereat, present in person or
represented by proxy, shall have power to adjourn the meeting from time to time,
without notice other than announcement at the meeting, until a quorum shall
2
<PAGE>
be present or represented. At such adjourned meeting at which a quorum shall be
present or represented any business may be transacted which might have been
transacted at the meeting as originally notified.
2.4 Voting. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before the meeting unless
other wise provided by statute or the certificate of incorporation or these
by-laws. At any meeting of the stockholders every stockholder having the right
to vote shall be entitled to vote in person or by proxy. Each stockholder shall
have one vote for each share of stock having voting power, registered in his
name on the books of the corporation.
2.5 Corporate Action by Consent. Whenever the vote of stockholders
at a meeting thereof is required or permitted to be taken in connection with any
corporate action, the meeting and vote of stockholders may be dispensed with if
all the stockholders entitled to vote upon the action consent thereto in
writing.
ARTICLE 3
DIRECTORS
3.1 Number, Term and Eligibility. The directors who shall constitute
the whole board shall be eighteen (18) in number. Directors shall be elected
3
<PAGE>
at the annual meeting of the stockholders and shall each serve for a term of one
year, except as provided in Section 3.2 hereof, and each director shall serve
until his successor shall be elected and qualify. Directors need not be stock-
holders. The foregoing provisions notwithstanding, each director elected at the
November 1, 1975 annual meeting of stockholders shall hold office for a term of
approximately seven months until the 1976 annual meeting of stockholders and
thereafter until his respective successor shall have been elected and shall have
qualified.
3.2 Vacancies. If any vacancies occur in the board of directors
caused by death, resignation, retirement, disqualification or removal from
office of any directors or otherwise, or any new directorship is created by any
increase in the authorized number of directors, a majority of the directors then
in office, though less than a quorum, may choose a successor or successors, or
fill the newly created directorship and the directors so chosen shall hold
office until the next annual election of directors and until their successors
shall be duly elected and qualified, unless sooner displaced.
3.3 Compensation. Directors shall not receive any compensation for
their services.
3.4 Meetings. Immediately after the adjournment of the annual
meeting of the stockholders, the new board of directors shall meet for the
purpose
4
<PAGE>
of organization, the election of officers, and the transaction of such other
business as may properly come before the meeting. Regular meetings of the board
may be held without notice at such time and place as shall from time to time be
determined by the board. Special meetings of the board may be called by the
president on seven (7) days' notice to each director, either personally or by
mail or by telegram; special meetings shall be called by the president or
secretary in like manner and on like notice on the written request of a majority
of the directors.
3.5 Quorum. At all meetings of the board a majority of the directors
shall be necessary and sufficient to constitute a quorum for the transaction of
business and the act of a majority of the directors present at any meeting at
which there is a quorum shall be the act of the board of directors, except as
may be otherwise specifically provided by statute or by the certificate of
incorporation or by these by-laws. If a quorum is not present at any meeting of
directors, the directors present thereat may adjourn the meeting from time to
time, without notice other than announcement at the meeting, until a quorum is
present.
ARTICLE 4
OFFICERS
4.1 Officers. The officers of Allied Van Lines International Cor-
5
<PAGE>
poration shall be Chairman of the Board, a Vice Chairman, a President, a
Secretary, a Treasurer and such other officers including Vice Presidents, as are
provided for by majority vote of all members of the Board of Directors, as
hereinafter provided. The Chairman of the Board, the Vice Chairman, the
Secretary and the Treasurer shall be selected from the Board of Directors at an
election by the Board of Directors to be carried out without nomination and by
secret ballot. For each such office, enough ballots shall be separately voted
until one person receives a majority of the votes cast. The President, who shall
not be an agent, nor a partner, employee or stockholder of an agent, shall be
appointed by resolution of the Board of Directors on recommendation of the
Chairman of the Board. The Vice Presidents and all other officers, none of whom
may be an agent, nor a partner, employee or stockholder of an agent, shall be
appointed by resolution of the Board of Directors, upon recommendation of the
President. Except as otherwise provided by these Bylaws, or by contract in the
case of an appointed officer, the term of every office shall be for one year and
until the successor has been duly chosen and qualified. Election or appointment
of an officer shall not of itself create contract rights. The foregoing
provisions notwithstanding, each officer chosen and qualified at the Board
organizational meeting following the 1975 annual meeting shall hold office for a
term of approximately seven months until the Board organizational meeting
following the 1976 annual meeting and thereafter until his respective successor
shall have been duly chosen and qualified.
6
<PAGE>
4.2 Compensation. The president, vice-president, secretary and
treasurer, of the corporation shall receive no compensation for their services.
4.3 Vacancies. The officers of the corporation shall hold office
until their successors are chosen and qualify in their stead. Any officer
elected or appointed by the board of directors may be removed at any time by the
affirmative vote of a majority of the whole board of directors. If an office
becomes vacant for any reason, the vacancy shall be filled by the board of
directors.
4.3A Chairman of the Board. The Chairman of the Board shall not be
elected to serve more than five (5) consecutive terms, except that election for
a sixth consecutive term may be voted, if approved, by secret ballot, by twelve
(12) members of the Board of Directors, excluding the Chairman. The Chairman of
the Board shall be the principal executive officer of the Corporation, and shall
preside over and conduct all meetings of stockholders and the Board of
Directors. Subject to the Board of Directors, he shall direct the policy of the
Corporation. He shall report to the Board regularly, and to the stockholders at
the annual meeting, on all matters within his knowledge which the interests of
the Corporation may require.
4.3B Vice Chairman. In the absence of the Chairman of the Board, or
in the event of his death, or inability or refusal to act, the Vice Chairman
shall perform the duties of the Chairman, and when so acting, shall have all the
7
<PAGE>
powers of and be subject to all the restrictions upon the Chairman.
4.4 President. The President shall be the chief administrative
officer of the Corporation. The President shall execute, or duly authorize the
execution of all contracts, deeds, mortgages, bonds and agreements authorized by
the Board of Directors. He shall vote all shares of stock of any other
corporation standing in the name of the Corporation, as directed by the Board of
Directors. In general, he shall perform all duties incident to the office of
President, and such other duties as may be prescribed by the Chairman of the
Board.
4.5 Vice-President. The vice-president shall, in the absence or
disability of the president, perform the duties and exercise the powers of the
president, and shall perform such other duties as the board of directors shall
prescribe.
4.6 Secretary. The secretary shall attend all sessions of the board
and all meetings of the stockholders and record all votes and the minutes of all
proceedings in a book to be kept for that purpose and shall perform like duties
for any standing committees when required. He shall give, or cause to be given,
notice of all meetings of the stockholders and special meeting of the board of
directors, and shall perform such other duties as may be prescribed by the board
of directors or president, under whose supervision he shall be. He shall keep
8
<PAGE>
in safe custody the seal of the corporation and, when authorized by the board,
affix it to any instrument requiring it and, when so affixed, it shall be
attested by his signature or by the signature of the treasurer or an assistant
secretary.
4.7 Assistant Secretary. The assistant secretary shall, in the
absence or disability of the secretary, perform the duties and exercise the
powers of the secretary and shall perform such other duties as the board of
directors shall prescribe.
4.8 Treasurer. The treasurer shall have the custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the board of directors. He shall
disburse the funds of the corporation as may be ordered by the board, taking
proper vouchers for such disbursements, and shall render to the president and
directors, at the regular meetings of the board, or whenever they may require
it, an account of all his transactions as treasurer and of the financial
condition of the corporation. If required by the board of directors, he shall
give the corporation a bond (which shall be renewed every six years) in such sum
and with such surety or sureties as shall be satisfactory to the board for the
faithful performance of the duties of his office and for the restoration to the
corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers,
9
<PAGE>
vouchers, money and other property of whatever kind in his possession or under
his control belonging to the corporation.
4.9 Assistant Treasurer. The assistant treasurer shall, in the
absence or disability of the treasurer, perform the duties and exercise the
powers of the treasurer and shall perform such other duties as the board of
directors shall prescribe.
ARTICLE 5
SHARES OF CAPITAL STOCK
5.1 Certificate. The certificates of stock of the corporation shall
be numbered and shall be entered in the books of the corporation as they are
issued. They shall exhibit the holder's name and number of shares and shall be
signed by the president or a vice president and the treasurer or an assistant
treasurer or the secretary or an assistant secretary. The designations,
preferences and relative, participating, optional or other special rights of
each class of stock or series thereof and the qualifications, limitations or
restrictions of such preferences or rights shall be set forth in full or
summarized on the face or back of the certificates which the corporation shall
issue to represent such class or series of stock.
5.2 Transfers. Upon surrender to the corporation of a certificate
for shares duly endorsed or accompanied by proper evidence of succession,
10
<PAGE>
assignment or authority to transfer, it shall be the duty of the corporation to
issue a new certificate to the person entitled thereto, cancel the old
certificate and record the transaction upon its books.
5.3 Registered Stockholders. The corporation shall be entitled to
treat the holder of record of any share or shares of stock as the holder in fact
thereof and, accordingly, shall not be bound to recognize any equitable or other
claim to or interest in such share or shares on the part of any other person,
whether or not it shall have express or other notice thereof, except as
otherwise provided by the laws of Delaware.
5.4 Lost Certificates. The board of directors may direct a new
certificate or certificates to be issued in place of any certificate or
certificates theretofore issued by the corporation alleged to have been lost or
destroyed, upon the making of an affidavit of that fact by the person claiming
the certificate of stock to be lost or destroyed. When authorizing such issue of
a new certificate or certificates, the board of directors may, in its discretion
and as a condition precedent to the issuance thereof, require the owner of such
lost or destroyed certificate or certificates, or his legal representative, to
give the corporation a bond in such sum as it may direct as indemnity against
any claim that may be made against the corporation with respect to the
certificate alleged to have been lost or destroyed.
11
<PAGE>
5.5 Dividends. Dividends upon the capital stock of the corporation,
subject to the provisions of the certificate of incorporation, if any, may be
declared by the board of directors at any regular or special meeting, pursuant
to law. Dividends may be paid in cash, in property, or in shares of the capital
stock, subject to the provisions of the certificate of incorporation. Before
payment of any dividend, there may be set aside out of any funds of the
corporation available for dividends such sum or sums as the directors from time
to time, in their absolute discretion, think proper as a reserve fund to meet
contingencies, or for equalizing dividends, or for repairing or maintaining any
property of the corporation, or for such other purpose as the directors shall
think conducive to the interest of the corporation, and the directors may modify
or abolish any such reserve in the manner in which it was created.
ARTICLE 6
NOTICES
6.1 Whenever notice is required to be given to any director or
stockholder under the provisions of the statutes or the certificate of
incorporation or these by-laws, it shall not be construed to mean personal
notice but may be given in writing, by mail, addressed to the director or
stockholder at such address as appears on the books of the corporation, and such
notice shall be deemed to be given at the time when it is thus mailed; and a
waiver thereof in writing signed by the person or persons entitled to the
notice, whether
12
<PAGE>
before or after the time stated therein, shall be deemed equivalent thereto.
ARTICLE 7
FISCAL YEAR
7.1 The fiscal year shall begin the first day of January in each
year.
ARTICLE 8
SEAL
8.1 The corporate seal shall have inscribed thereon the name of the
corporation, the year of its organization and the words "Corporate Seal,
Delaware". Said seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
ARTICLE 9
AMENDMENTS
9.1 These by-laws may be altered or repealed at any regular meeting
of the stockholders or at any special meeting of the stockholders at which a
quorum is present or represented by the affirmative vote of a majority of the
stock entitled to vote at such meeting and present or represented thereat, or by
the affirmative vote of a majority of the board of directors at any regular
meeting of the board or at any special meeting of the board if notice of the
proposed alteration or repeal be contained in the notice of such special
meeting.
13
<PAGE>
Exhibit 3.27
State of Delaware
PAGE 1
Office of the Secretary of State
--------------------------------
I, WILLIAM T. QUILLEN, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
AMENDMENT OF "ALLIED PICKFORDS U.S.A., INC.", CHANGING ITS NAME FROM "ALLIED
PICKFORDS U.S.A., INC." TO "ALLIED INTERNATIONAL N.A., INC.", FILED IN THIS
OFFICE ON THE TWENTY-SECOND DAY OF FEBRUARY, A.D. 1994, AT 1:30 O'CLOCK P.M.
[SEAL]
/s/ William T. Quillen
----------------------------------------
William T. Quillen, Secretary of State
0829174 8100 AUTHENTICATION: 7055203
944039653 DATE: 03-14-94
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
* * * * *
Allied Pickfords U.S.A., Inc., a corporation organized and existing under
and by virtue of the General Corporation Law of the State of Delaware (the
"Corporation"),
DOES HEREBY CERTIFY:
FIRST: That the Board of Directors of the Corporation, by the unanimous
written consent of its members, filed with the minutes of the Board, adopted a
resolution proposing and declaring advisable the following amendment to the
Certificate of Incorporation of the Corporation:
RESOLVED, that the Certificate of Incorporation of Allied Pickfords,
U.S.A., Inc. be amended by changing the Article thereof numbered "1." so
that, as amended, said Article shall be and read as follows:
"1. The name of the Corporation is:
Allied International N.A., Inc."
SECOND: That in lieu of a meeting and vote of the stockholders
of the Corporation, the sole stockholder has given written consent
to said amendment in accordance with the provisions of Section 228
of the General Corporation Law of the State of Delaware.
<PAGE>
THIRD: That the aforesaid amendment was duly adopted in accordance with
the applicable provisions of Sections 242 and 228 of the General Corporation Law
of the State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused this certificate to be
signed by Michael P. Fergus, its Vice President and Managing Director and
attested by Robert J. Henry, its Secretary, this 21 day of February, 1994.
ALLIED PICKFORDS U.S.A., INC.
By /s/ Michael P. Fergus
------------------------
Michael P. Fergus,
its Vice President and
Managing Director
ATTEST:
By /s/ Robert J. Henry
------------------------------
Robert J. Henry, its Secretary
0151AZ/rm
<PAGE>
032160 BK1277PG0603 PAGE 1
State of Delaware
[STATE CREST]
Office of Secretary of State
------------------------
I, MICHAEL RATCHFORD, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
AMENDMENT OF "ALLIED VAN LINES INTERNATIONAL CORPORATION" FILED IN THIS OFFICE
ON THE FIRST DAY OF APRIL, A.D. 1992, AT 4:30 O'CLOCK P.M.
* * * * * * * * * *
PAULETTE SULLIVAN MOORE RECEIVED FOR RECORD NCCO
000000 92 APR-8 A 9:57.5
[SEAL] /s/ Michael Ratchford
-------------------------------------
Michael Ratchford, Secretary of State
AUTHENTICATION: *3404614
732092025 DATE: 04/03/1992
<PAGE>
BK1277 PG0604
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 04:30 PM 04/01/1992
732092025 - 829174
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
* * * * *
Allied Van Lines International Corporation, a corporation organized and
existing under and by virtue of the General Corporation Law of the State of
Delaware (the "Corporation"), by the unanimous written consent of its members,
filed with the minutes of the Board,
DOES HEREBY CERTIFY:
FIRST: That the Board of Directors of the Corporation, adopted a
resolution proposing and declaring advisable the following amendment to the
Certificate of Incorporation of the Corporation:
RESOLVED, that the Certificate of Incorporation of Allied Van Lines
International Corporation be amended by changing the Article thereof
numbered "1." so that, as amended, said Article shall be and read as
follows:
"1. The name of the Corporation is:
Allied Pickfords U.S.A., Inc."
SECOND: That in lieu of a meeting and vote of the stockholders of the
Corporation, the sole stockholder has given written consent to said amendment in
accordance with the provisions of Section 228 of the General Corporation Law of
the State of Delaware.
<PAGE>
BK1277 PG0605
THIRD: That the aforesaid amendment was duly adopted in accordance with
the applicable provisions of Sections 242 and 228 of the General Corporation Law
of the State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused this certificate to be
signed by Robert E. Fleisher, its President and attested by Robert J. Henry, its
Secretary, this 30th day of March, 1992.
ALLIED VAN LINES INTERNATIONAL CORPORATION
By /s/ R. E. Fleisher
-----------------------------------
R. E. Fleisher, its President
ATTEST:
By /s/ Robert J. Henry
------------------------------
Robert J. Henry, its Secretary
650AZ/rm
<PAGE>
[STATE CREST]
State
of
DELAWARE
[GRAPHIC OMITTED]
Office of SECRETARY OF STATE
I, Robert H. Reed, Secretary of State of the State of Delaware, do hereby
certify that the above and foregoing is a true and correct copy of Certificate
of Amendment of the "ALLIED FREIGHT FORWARDING, INCORPORATED", as received and
filed in this office the twenty-ninth day of November, A.D. 1976, at 10 o'clock
A.M.
In Testimony Whereof, I have hereunto set my hand and official seal
at Dover this twenty-ninth day of November in the year of our Lord
one thousand nine hundred and seventy-six.
[SEAL] /s/ Robert H. Reed
----------------------------------------------
Robert H. Reed Secretary of State
/s/ Grover A. Biddle
----------------------------------------------
Grover A. Biddle Assistant Secretary of State
REC'D FOR RECORD NOV 29 1976 LEO J. DUGAN, Jr. Recorder
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
* * * * *
ALLIED FREIGHT FORWARDING, INCORPORATED, a corporation organized and
existing under and by virtue of the General Corporation Law of the State of
Delaware, DOES HEREBY CERTIFY.
FIRST: That the Board of Directors of said corporation, by the
unanimous written consent of its members, filed with the minutes of the board,
adopted a resolution proposing and declaring advisable the following amendment
to the Certificate of Incorporation of said corporation:
RESOLVED, that the Certificate of Incorporation of ALLIED FREIGHT
FORWARDING, INCORPORATED be amended by changing the Article thereof
numbered that, as amended, said Article shall be and read as
follows:
"1. The name of the corporation is ALLIED VAN LINES INTERNATIONAL
CORPORATION."
SECOND: That in lieu of a meeting and vote of stockholders, the
stockholders have given unanimous written consent to said amendment in
accordance with the provisions of Section 228 of The General Corporation Law of
the State of Delaware.
THIRD: That the aforesaid amendment was duly adopted in accordance
with the applicable provisions of Sections 242 and 228 of The General
Corporation Law of the State of Delaware.
<PAGE>
IN WITNESS WHEREOF, said ALLIED FREIGHT FORWARDING, INCORPORATED has
caused this certificate to be signed by Robert S. Seeler, its Vice President
and attested by Rex Denkmann, its Assistant Secretary, this 19th day of
November, 1976.
ALLIED FREIGHT FORWARDING, INCORPORATED
By /s/ Robert S. Seeler
-----------------------
Robert S. Seeler
Vice President
ATTEST:
By /s/ Rex Denkmann
-------------------
Rex Denkmann
Assistant Secretary
<PAGE>
[STATE CREST]
State
of
DELAWARE
[GRAPHIC OMITTED]
Office of SECRETARY OF STATE
I, Robert H. Reed, Secretary of State of the State of Delaware, do hereby
certify that the above and foregoing is a true and correct copy of Certificate
of Incorporation of the "ALLIED FREIGHT FORWARDING, INCORPORATED", as received
and filed in this office the twenty-first day of September, A.D. 1976, at 10
o'clock A.M.
In Testimony Whereof, I have hereunto set my hand and official seal
at Dover this twenty-first day of September in the year of our Lord
one thousand nine hundred and seventy-six.
[STATE SEAL] /s/ Robert H. Reed
----------------------------------------------
Robert H. Reed Secretary of State
/s/ Grover A. Biddle
----------------------------------------------
Grover A. Biddle Assistant Secretary of State
REC'D FOR RECORD SEP 21 1976 LEO J. DUGAN, Jr. Recorder
<PAGE>
CERTIFICATE OF INCORPORATION
OF
ALLIED FREIGHT FORWARDING, INCORPORATED
1. The name of the corporation is
ALLIED FREIGHT FORWARDING, INCORPORATED
2. The address of its registered office in the State of Delaware is
No. 100 West Tenth Street, in the City of Wilmington, County of New Castle. The
name of its registered agent at such address is The Corporation Trust Company.
3. The nature of the business or purposes to be conducted or
promoted is:
To conduct business as a freight forwarder under part IV of the
Interstate Commerce Act.
To engage in any lawful act or activity for which corporations may
be organized under the General Corporation Law of Delaware.
<PAGE>
4. The total number of shares of stock which the Corporation shall
have authority to issue is one thousand (1,000); all of such shares shall be
without par value.
5. The name and mailing address of each incorporator is as follows:
NAME MAILING ADDRESS
---- ---------------
G. J. Coyle 100 West Tenth Street
Wilmington, Delaware 19801
W. J. Reif 100 West Tenth Street
Wilmington, Delaware 19801
R. F. Andrews 100 West Tenth Street
Wilmington, Delaware 19801
6. The corporation is to have perpetual existence.
7. In furtherance and not in limitation of the powers conferred by
statute, the board of directors is expressly authorized to make, alter or repeal
the by-laws of the corporation.
8. Meetings of stockholders may be held within or without the State
of Delaware, as the by-laws may provide. The books of the corporation may be
kept (subject to any provision contained in the statutes) outside the State of
Delaware at such place or places as may be designated from time to time by the
board of directors or in the by-laws of the corporation. Elections of directors
need not be by written ballot unless the by-laws of the corporation shall so
provide.
9. The corporation reserves the right to amend, alter, change or
repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
<PAGE>
WE, THE UNDERSIGNED, being each of the incorporators hereinbefore
named, for the purpose of forming a corporation pursuant to the General
Corporation Law of the State of Delaware, do make this certificate, hereby
declaring and certifying that this is our act and deed and the facts herein
stated are true, and accordingly have hereunto set our hands and seals this 16th
day of September, 1976.
G. J. Coyle
---------------------
G. J. Coyle
W. J. Reif
---------------------
W. J. Reif
R. F. Andrews
---------------------
R. F. Andrews
<PAGE>
Exhibit 3.28
RESTATED BYLAWS
OF
ALLIED INTERNATIONAL N.A., INC.
ARTICLE I
OFFICES
Section 1.1 REGISTERED OFFICE. The registered office of ALLIED
INTERNATIONAL N.A., INC. (hereinafter called the Corporation") shall be at such
place in the State of Delaware as shall be designated by the Board of Directors
(hereinafter called the "Board").
Section 1.2 PRINCIPAL OFFICE. The principal office for the
transaction of the business of the Corporation shall be at such location, within
or without the State of Delaware, as shall be designated by the Board.
Section 1.3 OTHER OFFICES. The Corporation may also have an office
or offices at such other place or places, either within or without the State of
Delaware, as the Board may from time to time determine or as the business of the
Corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 2.1 ANNUAL MEETINGS. Annual meetings of the stockholders of
the Corporation for the purpose of electing directors and for the transaction of
such other proper business as may come before such meetings may be held at such
time, date and place as the Board shall determine by resolution.
Section 2.2 SPECIAL MEETINGS. Special meetings of the stockholders
of the Corporation for any purpose or purposes may be called at any time by the
Board, or by a committee of the Board which has been duly designated by the
Board and whose powers and authority as provided in a resolution of the Board or
in the Bylaws, include the power to call such meetings, but such special
meetings may not be called by any other person or persons; provided, however,
that if and to the extent that any special meeting of
<PAGE>
stockholders may be called by any other person or persons specified in any
provisions of the Certificate of Incorporation or any amendment thereto or any
certificate filed under Section 151(g) of the General Corporation Law of
Delaware (or its successor statute as in effect from time to time hereafter),
then such special meeting may also be called by the person or persons, in the
manner, at the time and for the purposes so specified.
Section 2.3 PLACE OF MEETINGS. All meetings of the stockholders
shall be held at such places, within or without the State of Delaware, as may
from time to time be designated by the person or persons calling the respective
meetings and specified in the respective notices or waivers of notice thereof.
Section 2.4 NOTICE OF MEETINGS. Except as otherwise required by law,
notice of each meeting of the stockholders, whether annual or special, shall be
given not less than ten (10) nor more than sixty (60) days before the date of
the meeting to each stockholder of record entitled to vote at such meeting by
delivering a typewritten or printed notice thereof to him personally, or by
depositing such notice in the United States mail, in a postage prepaid envelope,
directed to him at his address furnished by him to the Secretary of the
Corporation for such purpose or, if he shall not have furnished to the Secretary
his address for such purpose, then at his address last known to the Secretary,
or by transmitting a notice thereof to him at such address by telegraph, cable
or wireless. Except as otherwise expressly required by law, no publication of
any notice of a meeting of the stockholders shall be required. Every notice of a
meeting of the stockholders shall state the place, date and hour of the meeting,
and, in the case of a special Meeting shall also state the purpose or purposes
for which the meeting is called. Except as otherwise expressly required by law,
notice of any adjourned meeting of the stockholders need not be given if the
time and place thereof are announced at the meeting at which the adjournment is
taken.
Whenever notice is required to be given to any stockholder to whom
(i) notice of two consecutive annual meetings, and all notices of meetings or of
the taking of action by written consent without a meeting to such person during
the period between such two consecutive annual meetings, or (ii) all, and at
least two, payments (if sent by first class mail) of dividends or interest on
securities during a twelve month period, have been mailed addressed to such
person at his address as shown on the records of the corporation and have been
returned undeliverable, the giving
<PAGE>
of such notice to such person shall not be required. Any action or meeting which
shall be taken or held without notice to such person shall have the same force
and effect as if such notice had been duly given. If any person shall deliver to
the corporation a written notice setting forth his then current address, the
requirement that notice be given to such person shall be reinstated.
Section 2.5 QUORUM. Except as provided by law, the holders of record
of a majority in voting interest of the shares of stock of the Corporation
entitled to be voted, present in person or by proxy, shall constitute a quorum
for the transaction of business at any meeting of the stockholders of the
Corporation or any adjournment thereof. The stockholders present at a duly
called or held meeting at which a quorum is present may continue to do business
until adjournment, notwithstanding the withdrawal of enough stockholders to
leave less than a quorum. In the absence of a quorum at any meeting or any
adjournment thereof, a majority in voting interest of the stockholders present
in person or by proxy and entitled to vote thereat or, in the absence therefrom
of all the stockholders, any officer entitled to preside at or to act as
secretary of such meeting may adjourn such meeting from time to time. At any
such adjourned meeting at which a quorum is present any business may be
transacted which might have been transacted at the meeting as originally called.
Section 2.6 VOTING.
(a) Each stockholder shall be entitled to vote in person or by
proxy each share or fractional share of the stock of the Corporation which has
voting rights on the matter in question and which shall have been held by him
and registered in his name on the books of the Corporation:
(i) on the date fixed pursuant to Section 2.10 of
these Bylaws as the record date for the determination of
stockholders entitled to notice of and to vote at such
meeting, or
(ii) if no such record date shall have been so
fixed, then (A) at the close of business on the day next
preceding the day on which notice of the meeting shall he
given or (B) if notice of the meeting shall be waived, at the
close of business on the day next preceding the day on which
the meeting shall be held.
<PAGE>
(b) Shares of its own stock belonging to the Corporation or to
another corporation, if a majority of the shares entitled to vote in the
election of directors in such other corporation is held, directly or indirectly,
by the Corporation, shall neither be entitled to vote nor be counted for quorum
purposes. Persons holding stock of the Corporation in a fiduciary capacity shall
be entitled to vote such stock. Persons whose stock is pledged shall be entitled
to vote, unless in the transfer by the pledgor on the books of the Corporation
he shall have expressly empowered the pledgee to vote thereon, in which case
only the pledgee, or his proxy, may represent such stock and vote thereon. Stock
having voting power standing of record in the names of two or more persons,
whether fiduciaries, members of a partnership, joint tenants, tenants in common,
tenants by the entirety or otherwise, or with respect to which two or more
persons have the same fiduciary relationship, shall be voted in accordance with
the provisions of the General Corporation Law of Delaware.
(c) Any such voting rights may be exercised by the stockholder
entitled thereto in person or by his proxy appointed by an instrument in
writing, subscribed by such stockholder or by his attorney thereunto authorized
and delivered to the secretary of the meeting; provided, however, that no proxy
shall be voted or acted upon after three years from its date unless said proxy
shall provide for a longer period. The attendance at any meeting of a
stockholder who may theretofore have given a proxy shall not have the effect of
revoking the same unless he shall in writing so notify the secretary of the
meeting prior to the voting of the proxy. At any meeting of the stockholders all
matters, except as otherwise provided in the Certificate of Incorporation, in
these Bylaws or by law, shall be decided by the vote of a majority in voting
interest of the stockholders present in person or by proxy and entitled to vote
thereat and thereon. The vote at any meeting of the stockholders on any question
need not be by ballot, unless so directed by the chairman of the meeting. On a
vote by ballot, each ballot shall be signed by the stockholder voting, or by his
proxy if there be such proxy, and it shall state the number of shares voted.
Section 2.7 LIST OF STOCKHOLDERS. The Secretary of the Corporation
shall prepare and make, at least ten (10) days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the
<PAGE>
name of each stockholder. Such list shall be open to the examination of any
stockholder, for any purpose germane to the meeting, during ordinary business
hours, for a period of at least ten (10) days prior to the meeting, either at a
place within the city where the meeting is to be held, which place shall be
specified in the notice of the meeting, or, if not so specified, at the place
where the meeting is to be held. The list shall also be produced and kept at the
time and place of the meeting during the entire duration thereof, and may be
inspected by any stockholder who is present.
Section 2.8 INSPECTOR OF ELECTION. If at any meeting of the
stockholders a vote by written ballot shall be taken on any question, the
chairman of such meeting may appoint an inspector or inspectors of election to
act with respect to such vote. Each inspector so appointed shall first subscribe
an oath faithfully to execute the duties of an inspector at such meeting with
strict impartiality and according to the best of his ability. Such inspectors
shall decide upon the qualification of the voters and shall report the number of
shares represented at the meeting and entitled to vote on such question, shall
conduct and accept the votes, and, when the voting is completed, shall ascertain
and report the number of shares voted respectively for and against the question.
Reports of the inspectors shall be in writing and subscribed and delivered by
them to the Secretary of the Corporation. Inspectors need not be stockholders of
the Corporation, and any officer of the Corporation may be an inspector on any
question other than a vote for or against a proposal in which he shall have a
material interest.
Section 2.9 STOCKHOLDER ACTION WITHOUT MEETINGS. Any action required
by the General Corporation Law of Delaware to be taken at any annual or special
meeting of the stockholders, or any action which may be taken at any annual or
special meeting of the stockholders, may be taken without a meeting, without
prior notice and without a vote, if a consent in writing setting forth the
action so taken shall be signed by the holders of outstanding stock having not
less than the minimum number of votes that would be necessary to authorize or
take such action at a meeting at which all shares entitled to vote thereon were
present and voted. Prompt notice of the taking of the corporate action without a
meeting by less than unanimous written consent shall be given to those
stockholders who have not consented in writing.
Section 2.10 RECORD DATE. In order that the Corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
the stockholders or
<PAGE>
any adjournment thereof, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any other change, conversion or exchange of stock or for the purpose
of any other lawful action, the Board may fix, in advance, a record date, which
shall not be more than sixty (60) nor less than ten (10) days before the date of
such meeting, nor more than sixty (60) days prior to any other action. If, in
any case involving the determination of stockholders for any purpose other than
notice of or voting at a meeting of stockholders, the Board shall not fix such a
record date, the record date for determining stockholders for such purpose shall
be the close of business on the day on which the Board shall adopt the
resolution relating thereto. A determination of stockholders entitled to notice
of or to vote at a meeting of stockholders shall apply to any adjournment of
such meeting; provided, however, that the Board may fix a new record date for
the adjourned meeting.
ARTICLE III
BOARD OF DIRECTORS
Section 3.1 GENERAL POWERS. The property, business and affairs of
the Corporation shall be managed by or under the direction of the Board, which
may exercise all of the powers of the Corporation, except such as are by the
Certificate of Incorporation, by these Bylaws or by law conferred upon or
reserved to the stockholders.
Section 3.2 NUMBER AND TERM. The authorized number of directors
shall be a minimum of one and a maximum of nineteen until changed by a duly
adopted amendment to these Bylaws. The number of directors at any given time
shall be the number elected by the stockholders of the Corporation at each
annual meeting or at a special meeting called for the purpose electing directors
or by unanimous consent of the stockholders in lieu of a meeting. Each director
shall hold office until the next annual meeting and until a successor has been
elected and qualified, or resigns, or is removed consistent with these Bylaws.
Section 3.3 ELECTION OF DIRECTORS. The directors shall be elected by
the stockholders of the Corporation, and at each election the persons receiving
the greatest number of votes, up to the number of directors then to be elected,
shall be the persons then elected. The election of directors is subject to any
provisions contained in the Certificate of Incorporation relating thereto,
<PAGE>
including any provisions for a classified board.
Section 3.4 RESIGNATION AND REMOVAL. Any director of the Corporation
may resign at any time by giving written notice to the Board or to the Secretary
of the Corporation. Any such resignation shall take effect at the time specified
therein, or, if the time is not specified, it shall take effect immediately upon
its receipt; and, unless otherwise specified therein, the acceptance of such
resignation shall not be necessary to make it effective.
Subject to any provisions which may be contained in the Certificate
of Incorporation relating to election of directors or a classified board, any
director or the entire board of directors may be removed, with or without cause,
by the holders of a majority of shares then entitled to vote at an election of
directors.
Section 3.5 VACANCIES. Except as otherwise provided in the
Certificate of Incorporation, any vacancy in the Board, whether because of
death, resignation, disqualification, an increase in the number of directors, or
any other cause, may be filled by vote of the majority of the remaining
directors, although less than a quorum, or by a sole remaining director. Each
director so chosen to fill a vacancy shall hold office until his successor shall
have been elected and shall qualify or until he shall resign or shall have been
removed. No reduction of the authorized number of directors shall have the
effect of removing any director prior to the expiration of his term of office.
Upon the resignation of one or more directors from the Board,
effective at a future date, a majority of the directors then in office,
including those who have so resigned, shall have the power to fill such vacancy
or vacancies, the vote thereon to take effect when such resignation or
resignations shall become effective, and each director so chosen shall hold
office as provided hereinabove in the filling of other vacancies.
Section 3.6 PLACE OF MEETING; TELEPHONE CONFERENCE MEETING. The
Board may hold any of its meetings at such place or places within or without the
State of Delaware as the Board may from time to time by resolution designate or
as shall be designated by the person or persons calling the meeting or in the
notice or waiver of notice of any such meeting. Directors may participate in any
regular or special meeting of the Board by means of conference telephone or
similar communications equipment pursuant to which all persons participating in
the meeting of the Board
<PAGE>
can hear each other, and such participation shall constitute presence in person
at such meeting.
Section 3.7 FIRST MEETING. The Board shall meet as soon as
practicable after each annual election of directors and notice of such first
meeting shall not be required.
Section 3.8 REGULAR MEETINGS. Regular meetings of the Board may be
held at such times as the Board shall from time to time by resolution determine.
If any day fixed for a meeting shall be a legal holiday at the place where the
meeting is to be held, then the meeting shall be held at the same hour and place
on the next succeeding business day which is not a legal holiday. Except as
provided by law, notice of regular meetings need not be given.
Section 3.9 SPECIAL MEETINGS. Special meetings of the Board may be
called at any time by the Chairman of the Board, if any, the President or by any
director, to be held at the principal office of the Corporation, or at such
other place or places, within or without the State of Delaware, as the person or
persons calling the meeting may designate.
Notice of the time and place of special meetings shall be given to
each director either (i) by mailing or otherwise sending to him a written notice
of such meeting, charges prepaid, addressed to him at his address as it is shown
upon the records of the Corporation, or if it is not so shown on such records or
is not readily ascertainable, at the place in which the meetings of the
directors are regularly held, at least seventy-two (72) hours prior to the time
of the holding of such meeting; or (ii) by orally communicating the time and
place of the special meeting to him at least forty-eight (48) hours prior to the
time of the holding of such meeting. Either of the notices as above provided
shall be due, legal and personal notice to such director.
Whenever notice is required to be given, either to a stockholder or
a director, under any provision of the General Corporation Law of Delaware, the
Certificate of Incorporation or these Bylaws, a written waiver thereof, signed
by the person entitled to notice, whether before or after the time stated
therein, shall be deemed equivalent to notice. Attendance of a person at a
meeting, whether in person or by proxy, shall constitute a waiver of notice of
such meeting, except when the person attends a meeting for the express purpose
of objecting, at the beginning of the meeting, to the transaction of any
business because the
<PAGE>
meeting is not lawfully called or convened. Neither the business to be
transacted at nor the purpose of any regular or special meeting of directors or
committee of directors need be specified in any written waiver of notice.
All such waivers shall be filed with the corporate records or
made a part of the minutes of the meeting.
Section 3.10 QUORUM AND ACTION. Except as otherwise provided in
these Bylaws or by law, the presence of a majority of the authorized number of
directors shall be required to constitute a quorum for the transaction of
business at any meeting of the Board, and all matters shall be decided at any
such meeting, a quorum being present, by the affirmative votes of a majority of
the directors present. In the absence of a quorum, a majority of directors
present at any meeting may adjourn the same from time to time until a quorum
shall be present.
Notice of any adjourned meeting need not be given. The directors
shall act only as a Board, and the individual directors shall have no power as
such.
Section 3.11 ACTION BY CONSENT. Any action required or permitted to
be taken at any meeting of the Board or of any committee thereof may be taken
without a meeting if a written consent thereto is signed by all members of the
Board or of such committee, as the case may be, and such written consent is
filed with the minutes of proceedings of the Board or such committee. Such
action by written consent shall have the same force and effect as the unanimous
vote of such directors.
Section 3.12 COMPENSATION. No stated salary need be paid to
directors, as such, for their services but, as fixed from time to time by
resolution of the Board, the directors may receive directors' fees, compensation
and reimbursement for expenses for attendance at directors' meetings, for
serving on committees and for discharging their duties; provided that nothing
herein contained shall be construed to preclude any director from serving the
Corporation in any other capacity and receiving compensation therefor.
Section 3.13 COMMITTEES. The Board may, by resolution passed by a
majority of the whole Board, designate one or more committees, each committee to
consist of one or more of the directors of the Corporation. Any such committee,
to the extent provided in the resolution of
<PAGE>
the Board, shall have and may exercise all the powers and authority of the Board
in the management of the business and affairs of the Corporation, and may
authorize the seal of the Corporation to be affixed to all papers which may
require it; but no such committee shall have any power or authority in reference
to amending the Certificate of Incorporation, adopting an agreement of merger or
consolidation, recommending to the stockholders the sale, lease or exchange of
all or substantially all of the Corporation's property and assets, recommending
to the stockholders a dissolution of the Corporation or a revocation of a
dissolution, or amending the Bylaws of the Corporation; and, unless the
resolution of the Board expressly so provides, no such committee shall have the
power or authority to declare a dividend or to authorize the issuance of stock.
Any such committee shall keep written minutes of its meetings and report the
same to the Board when required.
In the absence or disqualification of any member of any such
committee, the members thereof present at any meeting and not disqualified from
voting, whether or not they constitute a quorum, may appoint another member of
the Board to act at the meeting in the place of such absent or disqualified
member.
A majority of the members, or replacements thereof, of any such
committee shall constitute a quorum for the transaction of business. Every act
or decision done or made by a majority of the members, or replacements thereof,
of any such committee shall be regarded as the act or decision of the entire
committee.
ARTICLE IV
OFFICERS
Section 4.1 OFFICERS. The officers of the Corporation shall be a
President, a Secretary and a Treasurer. The Corporation may also have, at the
discretion of the Board, a Chairman of the Board, one or more Vice Presidents,
one or more Assistant Vice Presidents, one or more Assistant Secretaries, one or
more Assistant Treasurers and such other officers as may be appointed in
accordance with the provisions of Section 4.3 of these Bylaws. One person may
hold two or more offices.
Section 4.2 ELECTION AND TERM. The officers of the Corporation,
except such officers as may be appointed in accordance with the provisions of
Section 4.3 or Section 4.5 of these Bylaws, shall be chosen annually by the
Board, and
<PAGE>
each shall hold his office until he shall resign or shall be removed or
otherwise disqualified to serve, or until his successor shall be elected and
qualified.
Section 4.3 SUBORDINATE OFFICERS. The Board may appoint, or may
authorize the President to appoint, such other officers as the business of the
Corporation may require, each of whom shall have such authority and perform such
duties as are provided in these Bylaws or as the Board or the President from
time to time may specify, and shall hold office until he shall resign or shall
be removed or otherwise disqualified to serve.
Section 4.4 REMOVAL AND RESIGNATION. Any officer may be removed,
with or without cause, by a majority of, the directors at the time in office, at
any regular or special meeting of the Board, or, except in case of an officer
chosen by the Board, by the President upon whom such power of removal may be
conferred by the Board.
Any officer may resign at any time by giving written notice to the
Board, the Chairman of the Board, if any, the President or the Secretary of the
Corporation. Any such resignation shall take effect at the date of the receipt
of such notice or at any later time specified therein; and unless otherwise
specified therein, the acceptance of such resignation shall not be necessary to
make it effective.
Section 4.5 VACANCIES. A vacancy in any office because of death,
resignation, removal, disqualification or any other cause shall be filled in the
manner prescribed in the Bylaws for the regular appointments to such office.
Section 4.6 CHAIRMAN OF THE BOARD. The Chairman of the Board, if
any, shall preside at all meetings of the stockholders and the Board and shall
have such other powers and duties as may from time to time be assigned to him by
the Board or prescribed in the Bylaws.
Section 4.7 PRESIDENT. The President of the Corporation shall,
subject to the control of the Board, have general supervision, direction and
control of the business and affairs of the Corporation. He shall preside at all
meetings of stockholders and the Board. He shall have the general powers and
duties of management usually vested in the chief executive officer of a
corporation, and shall have such other powers and duties with respect to the
administration of the business and affairs of the Corporation as may from time
to time be assigned to him by the Board or as prescribed by the Bylaws.
<PAGE>
Section 4.8 VICE PRESIDENT. The Vice President(s), if any, shall
exercise and perform such powers and duties with respect to the administration
of the business and affairs of the Corporation as from time to time may be
assigned to each of them by the President, by the Board or as is prescribed by
the Bylaws. In the absence or disability of the President, the Vice Presidents,
in order of their rank as fixed by the Board, or if not ranked, the Vice
President designated by the Board, shall perform all of the duties of the
President and when so acting shall have all of the powers of and be subject to
all the restrictions upon the President.
Section 4.9 SECRETARY. The Secretary shall keep, or cause to be
kept, a book of minutes at the principal office for the transaction of the
business of the Corporation, or such other place as the Board may order, of all
meetings of directors and stockholders, with the time and place of holding,
whether regular or special, and if special, how authorized and the notice
thereof given, the names of those present at directors' meetings, the number of
shares present or represented at stockholders' meetings and the proceedings
thereof.
The Secretary shall keep, or cause to be kept, at the principal
office for the transaction of the business of the Corporation or at the office
of the Corporation's transfer agent, a share register, or a duplicate share
register, showing the names of the stockholders and their addresses, the number
and classes of shares held by each, the number and date of certificates issued
for the same, and the number and date of cancellation of every certificate
surrendered for cancellation.
The Secretary shall give, or cause to be given, notice of all the
meetings of the stockholders and of the Board required by these Bylaws or by law
to be given, and he shall keep the seal of the Corporation in safe custody, and
shall have such other powers and perform such other duties as may be prescribed
by the Board or these Bylaws. If for any reason the Secretary shall fail to give
notice of any special meeting of the Board called by one or more of the persons
identified in Section 3.9 of these Bylaws, or if he shall fail to give notice of
any special meeting of the stockholders called by one or more of the persons
identified in Section 2.2 of these Bylaws, then any such person or persons may
give notice of any such special meeting.
Section 4.10 TREASURER. The Treasurer shall keep
<PAGE>
and maintain or cause to be kept and maintained, adequate and correct accounts
of the properties and business transactions of the Corporation, including
accounts of its assets, liabilities, receipts, disbursements, gains, losses,
capital, surplus and shares. Any surplus, including earned surplus, paid-in
surplus and surplus arising from a reduction of capital, shall be classified
according to source and shown in a separate account. The books of account at all
reasonable times shall be open to inspection by any director.
The Treasurer shall deposit all moneys and other valuables in the
name and to the credit of the Corporation with such depositories as may be
designated by the Board. He shall disburse the funds of the Corporation as may
be ordered by the Board, shall render to the President and to the directors,
whenever they request it, an account of all of his transactions as Treasurer and
of the financial condition of the Corporation, and shall have such other powers
and perform such other duties as may be prescribed by the Board or these Bylaws.
Section 4.11 COMPENSATION. The compensation of the officers of the
Corporation shall be fixed from time to time by the Board.
ARTICLE V
CONTRACTS, CHECKS, DRAFTS, BANK ACCOUNTS, ETC.
Section 5.1 EXECUTION OF CONTRACTS. The Board, except as otherwise
provided in these Bylaws, may authorize any officer or officers, agent or
agents, to enter into any contract or execute any instrument in the name and on
behalf of the Corporation, and such authority may be general or confined to
specific instances; and unless so authorized by the Board or by these Bylaws, no
officer, agent or employee shall have any power or authority to bind the
Corporation by any contract or engagement or to pledge its credit or to render
it liable for any purpose or in any amount.
Section 5.2 CHECKS, DRAFTS, ETC. All checks, drafts or other orders
for payment of money, notes or other evidence of indebtedness, issued in the
name of or payable to the corporation, shall be signed or endorsed by such
person or persons and in such manner as, from time to time, shall be determined
by resolution of the Board. Each such person shall give such bond, if any, as
the Board may require.
<PAGE>
Section 5.3 DEPOSITS. All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the Corporation
in such banks, trust companies or other depositories as the Board may select, or
as may be selected by any officer or officers, assistant or assistants, agent or
agents, attorney or attorneys, of the Corporation to whom such power shall have
been delegated by the Board. For the purpose of deposit and for the purpose of
collection for the account of the Corporation, the President, any Vice President
or the Treasurer (or any other officer or officers, assistant or assistants,
agent or agents, or attorney or attorneys of the Corporation who shall be
determined by the Board from time to time) may endorse, assign and deliver
checks, drafts and other orders for the payment of money which are payable to
the order of the Corporation.
Section 5.4 GENERAL AND SPECIAL BANK ACCOUNTS. The Board from time
to time may authorize the opening and keeping of general and special bank
accounts with such banks, trust companies or other de-positories as the Board
may select or as may be selected by an officer or officers, assistant or
assistants, agent or agents, or attorney or attorneys of the Corporation to whom
such power shall have been delegated by the Board. The Board may make such
special rules and regulations with respect to such bank accounts, not
inconsistent with the provisions of these Bylaws, as it may deem expedient.
ARTICLE VI
SHARES AND THEIR TRANSFER
Section 6.1 CERTIFICATES FOR STOCK. The shares of the Corporation
shall be represented by certificates, provided that the Board may provide by
resolution or resolutions that some of all of any or all classes of stock shall
be uncertified shares. Any such resolution shall not apply to shares represented
by a certificate until such certificate is tendered to the Corporation.
Notwithstanding the adoption of such a resolution, every holder of stock
represented by certificates, and upon request every holder of uncertified
shares, shall be entitled to have a certificate, in such form as the Board shall
prescribe, signed by, or in the name of, the Corporation by the Chairman of the
Board, the President or a Vice President and by the Secretary or an Assistant
Secretary or by the Treasurer or an Assistant Treasurer representing the number
of shares registered in certificate form. Any or all of the
<PAGE>
signatures on the certificates may be a facsimile. In case any officer, transfer
agent or registrar who has signed or whose facsimile signature has been placed
upon any such certificate shall thereafter have ceased to be such officer,
transfer agent or registrar before such certificate is issued, such certificate
may nevertheless be issued by the Corporation with the same effect as though the
person who signed such certificate, or whose facsimile signature shall have been
placed thereupon, were such officer, transfer agent or registrar at the date of
issue. A record shall be kept of the respective names of the persons, firms or
corporations owning the stock represented by such certificates, the number and
class of shares represented by such certificates, respectively, and the
respective dates thereof, and in case of cancellation, the respective dates of
cancellation. Every certificate surrendered to the Corporation for exchange or
transfer shall be cancelled, and no new certificate or certificates shall be
issued in exchange for any existing certificate until such existing certificate
shall have been so cancelled, except in cases provided for in Section 6.4 of
these Bylaws.
Section 6.2 TRANSFER OF STOCK. Transfer of shares of stock of the
Corporation shall be made only on the books of the Corporation by the registered
holder thereof, or by his attorney thereunto authorized by power of attorney
duly executed and filed with the Secretary, or with a transfer clerk or a
transfer agent appointed as provided in Section 6.3 of these Bylaws, and upon
surrender of the certificate or certificates for such shares properly endorsed
and the payment of all taxes thereon. The person in whose name shares of stock
stand on the books of the Corporation shall be deemed the owner thereof for all
purposes as regards the Corporation. Whenever any transfer of shares shall be
made for collateral security, and not absolutely, such fact shall be stated
expressly in the entry of transfer if, when the certificate or certificates
shall be presented to the Corporation for transfer, both the transferor and the
transferee request the Corporation to do so.
Section 6.3 REGULATIONS. The Board may make such rules and
regulations as it may deem expedient, not inconsistent with these Bylaws,
concerning the issue, transfer and registration of certificates for shares of
the stock of the Corporation. The Board may appoint, or authorize any officer or
officers to appoint, one or more transfer clerks or one or more transfer agents
and one or more registrars, and may require all certificates for stock to bear
the signature or signatures of any of them.
Section 6.4 LOST, STOLEN, DESTROYED AND MUTILATED
<PAGE>
CERTIFICATES. In any case of loss, theft, destruction, or mutilation of any
certificate of stock, another may be issued in its place upon proof of such
loss, theft, destruction, or mutilation and upon the giving of a bond of
indemnity to the Corporation in such form and in such sums as the Board may
direct; provided, however, that a new certificate may be issued without
requiring any bond when, in the judgment of the Board, it is proper to do so.
Section 6.5 REPRESENTATION OF SHARES OF OTHER CORPORATIONS. The
President or any Vice President and the Secretary or any Assistant Secretary of
this Corporation are authorized to vote, represent and exercise on behalf of
this Corporation all rights incident to all shares of any other corporation or
corporations standing in the name of this Corporation. The authority herein
granted to said officers to vote or represent on behalf of this Corporation any
and all shares held by this corporation in any other corporation or corporations
may be exercised either by such officers in person or by any person authorized
so to do by proxy or power of attorney duly executed by said officers.
ARTICLE VII
INDEMNIFICATION
Section 7.1 ACTIONS, SUITS OR PROCEEDINGS OTHER THAN BY OR IN THE
RIGHT OF THE CORPORATION. The Corporation shall indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that he or she is or was a director or officer of the
Corporation, or is or was serving at the request of the corporation as a
director or officer of another corporation, partnership, joint venture, trust or
other enterprise, including service with respect to an employee benefit plan, or
by reason of any action alleged to have been taken or omitted in such capacity,
against expenses (including attorneys' fees), judgments, fines, ERISA excise
taxes and amounts paid in settlement actually and reasonably incurred by him or
her or on his or her behalf in connection with such action, suit or proceeding
and any appeal therefrom if he or she acted in good faith and in a manner he or
she reasonably believed to be in, or not opposed to, the best interests of the
Corporation, and, with respect to any
<PAGE>
action or proceeding, had no reasonable cause to believe his or her conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contenders or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which he or she reasonably believed to be in, or not
opposed to, the best interests of the corporation and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his or her
conduct was unlawful. The Corporation may elect to indemnify an employee or
agent pursuant to this Section 7.1 of its Bylaws.
Section 7.2 ACTIONS OR SUITS BY OR IN THE RIGHT OF THE CORPORATION.
The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Corporation to procure a judgment in its favor by
reason of the fact that he or she is or was a director or officer of the
corporation or is or was serving or has agreed to serve at the request of the
Corporation as a director or officer of another corporation, partnership, joint
venture, trust or other enterprise, or by reason of any action alleged to have
been taken or omitted in such capacity, against expenses (including attorneys'
fees) actually and reasonably incurred by him or her or on his or her behalf in
connection with the defense or settlement of such action or suit and any appeal
therefrom, if he or she acted in good faith and in a manner he or she reasonably
believed to be in, or not opposed to, the best interests of the Corporation,
except that no indemnification shall be made in respect of any claim, issue, or
matter as to which such person shall have been adjudged to be liable to the
Corporation unless and only to the extent that the Court of Chancery of Delaware
or the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of such liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such costs, charges and expenses which the Court of Chancery or
such other court shall deem proper. The Corporation may elect to indemnify an
employee or agent pursuant to this Section 7.2 of its Bylaws.
Section 7.3 INDEMNIFICATION FOR COSTS, CHARGES AND EXPENSES OF
SUCCESSFUL PARTY. Notwithstanding the other provisions of this Article SEVEN, to
the extent that a director or officer has been successful, on the merits or
otherwise, including, without limitation to the extent permitted by applicable
law, the dismissal of an action without prejudice, in defense of any action,
suit or
<PAGE>
proceeding referred to in Sections 7.1 and 7.2, or in defense of any claim issue
or matter therein, he or she shall be indemnified against all costs, charges and
expenses (including attorneys' fees) actually and reasonably incurred by him or
her or on his or her behalf in connection therewith.
Section 7.4 DETERMINATION OF RIGHT TO INDEMNIFICATION. Any
indemnification under Sections 7.1 and 7.2, (unless ordered by a court) shall be
paid by the Corporation, if a determination is made (a) by the board of
directors by a majority vote of the directors who were not parties to such
action, suit or proceeding, or (b) if such majority of disinterested directors
so directs, by independent legal counsel in a written opinion or (c) by the
stockholders, that indemnification of the director or officer is proper in the
circumstances because he or she has met the applicable standard of conduct set
forth in Sections 7.1 and 7.2.
Section 7.5 ADVANCE OF COSTS, CHARGES AND EXPENSES. Expenses
(including attorneys fees) incurred by a person referred to in Sections 7.1 and
7.2 in defending a civil, criminal, administrative or investigative action, suit
or proceeding shall be paid by the Corporation in advance of the final
disposition of such action, suit or proceeding; provided, however, that the
payment of such costs, charges and expenses incurred by a director or officer in
his or her capacity as a director or officer (and not in any other capacity in
which service was or is rendered by such person while a director or officer) in
advance of the final disposition of such action, suit or proceeding shall be
made only upon receipt of an undertaking by or on behalf of the director or
officer to repay all amounts so advanced in the event that it shall ultimately
be determined that such director or officer is not entitled to be indemnified by
the Corporation as authorized in this Article VII. Such costs, charges and
expenses incurred by employees and agents may be so paid upon such terms and
conditions, if any, as the majority of the directors deems appropriate. The
majority of the directors may, in the manner set forth above, and upon approval
of such director or officer of the corporation, authorize the Corporation's
counsel to represent such person, in any action, suit or proceeding, whether or
not the corporation is a party to such action, suit or proceeding.
Section 7.6 PROCEDURE FOR INDEMNIFICATION. Any indemnification under
Sections 7.1, 7.2 and 7.3, or advance of costs, charges and expenses under
Section 7.5, shall be made promptly, and in any event within 60 days, upon the
written request of the director, officer, employee or agent.
<PAGE>
The right to indemnification or advances as granted by this Article SEVEN shall
be enforceable by the director, officer, employee or agent in any court of
competent jurisdiction, if the Corporation denies such request, in whole or in
part, or if no disposition thereof is made within 60 days. Such person's costs
and expenses incurred in connection with successfully establishing his or her
right to indemnification, in whole or in part, in any such action shall also be
indemnified by the Corporation. It shall be a defense to any such action (other
than an action brought to enforce a claim for the advance of costs, charges and
expenses under Section 7.5, where the required undertaking, if any, has been
received by the Corporation) that the claimant has not met the standard of
conduct set forth in Sections 7.1 and 7.2, but the burden of proving such
defense shall be on the Corporation. Neither the failure of the Corporation
(including its board of directors, its independent legal counsel and its
stockholders) to have made a determination prior to the commencement of such
action that indemnification of the claimant is proper in the circumstances
because he or she has met the applicable standard of conduct set forth in
Sections 7.1 and 7.2, nor the fact that there has been an actual determination
by the Corporation (including its board of directors, its independent legal
counsel and its stockholders) that the claimant has not met such applicable
standard of conduct, shall be a defense to the action or create a presumption
that the claimant has not met the applicable standard of conduct.
Section 7.7 SETTLEMENT. The Corporation shall not be obligated to
reimburse the costs of any settlement to which it has not agreed. If in any
action, suit or proceeding, including any appeal, within the scope of Sections
7.1 and 7.2, the person to be indemnified shall have unreasonably failed to
enter into a settlement thereof offered or assented to by the opposing party or
parties in such action, suit or proceeding, then, notwithstanding any other
provision hereof, the indemnification obligation of the Corporation to such
person in connection with such action, suit or proceeding shall not exceed the
total of the amount at which settlement could have been made and the expenses
incurred by such person prior to the time such settlement could reasonably have
been effected.
Section 7.8 SUBSEQUENT AMENDMENT. No amendment, termination or
repeal of this Article SEVEN or of relevant provisions of the Delaware General
Corporation Law or any other applicable law shall affect or diminish in any way
the rights of any director or officer of the Corporation to indemnification
under the provisions hereof with respect to
<PAGE>
any action, suit or proceeding arising out of, or relating to, any actions,
transactions or facts occurring prior to the final adoption of such amendment,
termination or repeal.
Section 7.9 OTHER RIGHTS; Continuation of Right to Indemnification.
The indemnification provided by this Article SEVEN shall not be deemed exclusive
of any other rights to which a director, officer, employee or agent seeking
indemnification may be entitled under any law (common or statutory), agreement,
vote of stockholders or disinterested directors or otherwise, both as to action
in his or her official capacity and as to action in any other capacity while
holding office or while employed by or acting as agent for the Corporation, and
shall, continue as to a person who has ceased to be a director, officer,
employee or agent, and shall inure to the benefit of the estate, heirs,
executors and administrators of such person. Nothing contained in this Article
SEVEN shall be deemed to prohibit and the Corporation is specifically authorized
to enter into, agreements with officers and directors providing indemnification
rights and procedures different from those set forth herein. All rights to
indemnification under this Article SEVEN shall be deemed to be a contract
between the Corporation and each director or officer of the Corporation who
serves or served in such capacity at any time while this Article SEVEN is in
effect. The Corporation shall not consent to any acquisition, merger,
consolidation or other similar transaction unless the successor corporation
assumes by operation of law or by agreement the obligations set forth in this
Article SEVEN.
Section 7.10 INSURANCE. The Corporation shall have the power to
purchase and maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the Corporation as director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against any liability asserted against him or her and incurred by him or her in
any such capacity, or arising out of his or her status as such, whether or not
the corporation would have the power to indemnify him or her against such
liability under this Article SEVEN.
Section 7.11 CERTAIN DEFINITIONS. For purposes of this Article
SEVEN:
(i) references to "the corporation" shall include, in addition
to the resulting corporation, any constituent corporation (including
any
<PAGE>
constituent of a constituent) absorbed in a consolidation or merger
which, if its separate existence had continued, would have had the
power and authority to indemnify its directors, officers, employees
or agents, so that any person who is or was a director, officer,
employee or agent of such constituent corporation, or is or was
serving at the request of such constituent corporation as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprises, shall stand
in the same position under this Article SEVEN with respect to the
resulting or surviving corporation as he or she would have with
respect to such constituent corporation if its separate existence
had continued;
(ii) references to "other enterprises" shall include employee
benefit plans;
(iii) references to "fines" shall include any excise taxes
assessed on a person with respect to an employee benefit plan;
(iv) references to "serving at the request of the corporation"
shall include any service as a director, officer, employee or agent
of the corporation which imposes duties on, or involves services by,
such director, officer, employee or agent with respect to an
employee benefit plan, its participants or beneficiaries;
(v) a person who acted in good faith and in a manner he or she
reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan shall be deemed to have
acted in a manner "not opposed to the best interests of the
Corporation," as referred to in this Article SEVEN; and
(vi) references to "agent" shall not include the agents who
have executed agency contracts with the corporation to book, ship,
haul or transport household goods or other special products, or
agents or officers, directors and employees of such agents.
Section 7.12 SAVINGS CLAUSE. If this Article SEVEN or any portion
hereof shall be invalidated on any ground by any court of competent
jurisdiction, then the Corporation shall nevertheless indemnify each director or
<PAGE>
officer of the Corporation as to any costs, charges, expenses (including
attorney's fees), judgments, fines and amounts paid in settlement with respect
to any action, suit or proceeding, whether civil, criminal, administrative or
investigative, including an action by or in the right of the Corporation, to the
full extent permitted by any applicable portion of this Article SEVEN that shall
not have been invalidated and to the full extent permitted by applicable law.
Section 7.13 SUBSEQUENT LEGISLATION. If the Delaware General
Corporation Law is amended after the date hereof to further expand the
indemnification permitted to directors and officers of the Corporation, then the
Corporation shall indemnify such person to the fullest extent permitted by the
Delaware General Corporation Law, as so amended.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 SEAL. The Board shall provide a corporate seal, which
shall be in the form of a circle and shall bear the name of the Corporation and
words and figures showing that the Corporation was incorporated in the State of
Delaware.
Section 8.2 WAIVER OF NOTICES. Whenever notice is required to be
given by these Bylaws or the Certificate of Incorporation or by law, the person
entitled to said notice may waive such notice in writing, either before or after
the time stated therein, and such waiver shall be deemed equivalent to notice.
Attendance of a person at a meeting shall constitute a waiver of notice of such
meeting, except when the person attends a meeting for the express purpose of
objecting, at the beginning of the meeting, to the transaction of any business
because the meeting is not lawfully called or convened. Neither the business to
be transacted at, nor the purpose of, any regular or special meeting of the
stockholders, directors, or members of a committee of directors need be
specified in any written waiver of notice.
Section 8.3 LOANS AND GUARANTIES. The Corporation may lend money to,
or guarantee any obligation of, and otherwise assist any officer or other
employee of the Corporation or of its subsidiaries, including any officer who is
a director, whenever, in the judgment of the
<PAGE>
Board, such loan, guaranty or assistance may reasonably be expected to benefit
the Corporation. The loan, guaranty, or other assistance may be with or without
interest, and may be unsecured or secured in such manner as the Board shall
approve, including, without limitation, a pledge of shares of stock of the
Corporation.
Section 8.4 GENDER. All personal pronouns used in these Bylaws shall
include the other genders, whether used in the masculine, feminine or neuter
gender, and the singular shall include the plural, and vice versa, whenever and
as often as may be appropriate.
Section 8.5 AMENDMENTS. These Bylaws, or any of them, may be
rescinded, altered, amended or repealed, and new Bylaws may be made (i) by the
Board, by vote of a majority of the number of directors then in office as
directors, acting at any meeting of the Board or (ii) by the stockholders, by
the vote of a majority of the outstanding shares of voting stock of the
Corporation, at an annual meeting of stockholders, without previous notice, or
at any special meeting of stockholders, provided that notice of such proposed
amendment, modification, repeal or adoption is given in the notice of special
meeting; provided, however, that Section 2.2 of these Bylaws can only be amended
if that Section as amended would not conflict with the Corporation's Certificate
of Incorporation. Any Bylaw made or altered by the stockholders may be altered
or repealed by the Board or may be altered or repealed by the stockholders.
<PAGE>
Exhibit 3.29
Page 1
State of Delaware
Office of Secretary of State
I, MICHAEL HARKINS, SECRETARY OF STATE OF THE STATE OF DELAWARE DO HEREBY
CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF AGREEMENT
OF MERGER OF "NFC MERGER CORPORATION" MERGING WITH AND INTO "ALLIED VAN LINES,
INC." UNDER THE NAME OF "ALLIED VAN LINES, INC." AS RECEIVED AND FILED IN THIS
OFFICE THE NINTH DAY OF FEBRUARY, A.D. 1988, AT 1 O'CLOCK P.M.
/s/ Michael Harkins
-------------------------------------------
Michael Harkins, Secretary of State
AUTHENTICATION: 1577615
[SEAL]
Date: 02/09/1988
SEAL OF THE STATE OF DELAWARE
888040052
<PAGE>
AGREEMENT OF MERGER
OF
NFC MERGER CORPORATION
AND
ALLIED VAN LINES, INC.
This Agreement of Merger ("Agreement"), dated January 24, 1988, is made
and entered into by and between NFC Merger Corporation, a Delaware corporation
("Newco"), and Allied Van Lines, Inc., a Delaware corporation (the "Company,"
and, collectively with Newco, the "constituent corporations").
WITNESSETH:
WHEREAS, the Company, National Freight Company International Holdings
(U.S.A.) Inc., a Delaware corporation (the "Acquiror"), and National Freight
Consortium p.l.c., a company organized under the laws of the United Kingdom
("NFC"), have entered into an Agreement and Plan of Merger dated as of November
27, 1987 ("Merger Agreement"), which contemplates the merger of Newco with and
into the Company; and
WHEREAS, the Company, Acquiror, NFC and Newco wish for the Company and
Newco to execute a definitive agreement of merger to effect the purposes of the
Merger Agreement and to satisfy the requirements of the General Corporation Law
of the State of Delaware ("Delaware Law");
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and in the Merger Agreement and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, it is hereby agreed
that:
1. The merger shall become effective (the "Effective Time") upon the
filing of this Agreement with the Secretary of State of Delaware.
2. At the Effective Time, Newco shall merge with and into the Company
(such merger being hereinafter referred to as the "Merger") upon the terms and
<PAGE>
conditions set forth herein and in the Merger Agreement and in accordance with
Delaware Law, and the Company shall continue as the surviving corporation, and
(a) the separate corporate existence of Newco shall cease; (b) the Restated
Certificate of Incorporation of the surviving corporation shall be amended to
read as set forth in Exhibit A attached hereto; (c) the bylaws of Newco in
effect immediately prior to the Effective Time shall be the bylaws of the
surviving corporation; (d) the directors of the surviving corporation shall be
those persons who were the directors of Newco immediately prior to the Effective
Time or such other persons as may be designated by Newco; and (e) the officers
of the surviving corporation shall be those persons who were the officers of the
Company immediately prior to the Effective Time.
3. At the Effective Time, the shares of capital stock of each of the
constituent corporations shall by virtue of the Merger, without any further
action on the part of either of the constituent corporations or the respective
holders of such shares of capital stock, be converted or cancelled as follows:
(a) each Share of common stock, par value $.1O, of the Company (the
"Shares") (i) held by the Company as treasury stock, or (ii) owned by the
Acquiror, Newco or any other subsidiary or affiliate of the Acquiror shall
forthwith be cancelled without payment of any consideration therefor and without
any conversion thereof;
(b) each share of common stock of Newco then issued and outstanding
and owned, directly or indirectly, by the Acquiror shall be converted into and
become one validly issued, fully paid and non-assessable share of common stock
of the surviving corporation, which shall be owned, directly or indirectly, by
the Acquiror and which shall constitute the only issued and outstanding shares
of capital stock of the surviving corporation; and
(c) each Share then issued and outstanding (other than Shares held
by stockholders who properly exercise dissenters' rights, if available, with
respect
-2-
<PAGE>
to the Merger under Delaware Law, and other than Shares referred to in
Section 3(a)) shall be converted into the right to receive, and shall be
exchangeable for, a distribution of cash in the amount of $93.965882 per share,
without any interest thereon, pursuant to the terms of Section 2.3 of the Merger
Agreement (the "Initial Distribution") and a contingent distribution of up to
$l.339744 per share, plus interest earned thereon in cash from the Escrow Fund
as defined in and pursuant to the terms of Section 2.5 of the Merger Agreement
("Escrow Distribution"); provided, however, that each then outstanding Share
issued on or after November 10, 1987 pursuant to a Share Purchase Agreement
restricting the holder of such Share from participating in any premium paid for
Shares in connection with the Merger shall entitle the holder thereof to receive
the price per Share provided for in such Share Purchase Agreement in lieu of the
Initial Distribution and the Escrow Distribution, and no further consideration
shall be payable in respect of such Shares.
4. This Agreement is subject to all of the terms, conditions and covenants
of the Merger Agreement.
5. This Agreement may be terminated by the mutual consent of Newco and the
Company and shall automatically terminate upon termination of the Merger
Agreement pursuant to Section 8.1 of the Merger Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date hereof by their duly authorized officers pursuant to resolutions
adopted by their respective Boards of Directors.
NFC MERGER CORPORATION ALLIED VAN LINES, INC.
By: [ILLEGIBLE] By: [ILLEGIBLE]
------------------------------ ----------------------------------
President President
Attest: [ILLEGIBLE] Attest: [ILLEGIBLE]
-------------------------- ------------------------------
Secretary Assistant Secretary
-3-
<PAGE>
ACKNOWLEDGMENT
STATE OF ILLINOIS )
)
COUNTY OF COOK )
BE IT REMEMBERED, that on this 24th day of January, 1988, personally
appeared before me, a Notary Public in and for the State and County aforesaid,
Peter P. Mazzetti, to me known and known to be the person described in and who
executed the foregoing Agreement of Merger as President of Allied Van Lines,
Inc., a corporation of the State of Delaware and one of the constituent
corporations described in and party to the foregoing Agreement of Merger, who
acknowledged before me that he executed the same as President of his respective
constituent corporation, that the foregoing Agreement of Merger is the act, deed
and agreement of his respective constituent corporation, and that the facts
stated therein are true.
Witness my hand and affixed seal in the County and State aforesaid this
24th day of January, 1988.
/s/ Deanna L. Patton
--------------------------------
Notary Public
[NOTARY STAMP]
State of Illinois
My Commission Expires: 9/14/91
----------
(NOTARIAL SEAL)
<PAGE>
ACKNOWLEDGMENT
STATE OF ILLINOIS )
)
COUNTY OF COOK )
BE IT REMEMBERED, that on this 24th day of January, 1988, personally
appeared before me, a Notary Public in and for the State and County aforesaid,
Edward A. Wall, to me known and known to be the person described in and who
executed the foregoing Agreement of Merger as President of NFC Merger
Corporation, a corporation of the State of Delaware and one of the constituent
corporations described in and party to the foregoing Agreement of Merger, who
acknowledged before me that he executed the same as President of his respective
constituent corporation, that the foregoing Agreement of Merger is the act, deed
and agreement of his respective constituent corporation, and that the facts
stated therein are true.
Witness my hand and affixed seal in the County and State aforesaid
this 24th day of January, 1988.
/s/ Deanna L. Patton
--------------------------------
Notary Public
[NOTARY STAMP]
State of Illinois
My Commission Expires: 9/14/91
----------
(NOTARIAL SEAL)
<PAGE>
EXHIBIT A
RESTATED CERTIFICATE OF INCORPORATION
OF
ALLIED VAN LINES, INC.
(Originally Incorporated on March 12, 1928)
I.
The name of this Corporation shall be: ALLIED VAN LINES, INC.
II.
The address of the registered office of this Corporation in the State of
Delaware is 1013 Centre Road in the City of Wilmington, County of New Castle
19805, and the name of its registered agent at that address is Corporation
Service Company.
III.
The purpose of this Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of Delaware.
IV.
This Corporation is authorized to issue two classes of stock designated
"Preferred Stock" and "Common Stock," respectively. The total number of shares
of Preferred Stock authorized to be issued is Ten Thousand (10,000) and each
such share shall have a par value of one cent ($0.01). The total number of
shares of Common Stock authorized to be issued is Ten Thousand (10,000) and each
such share shall have a par value of one cent ($0.01).
Each holder of Common Stock shall be entitled to one vote for each share
of Common Stock held of record by such holder and shall be entitled to vote with
respect to all matters as to which a stockholder of a Delaware corporation would
be entitled to vote.
The shares of Preferred Stock may be issued from time to time in one or
more series. The Board of Directors of this Corporation is hereby authorized, by
filing a certificate pursuant to the applicable law of the State of Delaware, to
establish from time to time the number of shares to be included in each such
series, and to fix the designation, powers, preferences and rights of the shares
of each such series and the qualifications, limitations or restrictions thereof,
including but not limited to the fixing or alteration of the dividend rights,
dividend rate, conversion rights, voting rights, rights and terms of redemption
(including sinking fund provisions), the redemption price or prices, and the
liquidation preferences of any wholly unissued series of shares of Preferred
Stock, or any of them; and to increase or decrease the number of shares of any
series subsequent to the issue of the shares of that series, but not below the
number of shares of such series then outstanding. In case the
<PAGE>
number of shares of any series shall be so decreased, the shares constituting
such decrease shall resume the status which they had prior to the adoption of
the resolution originally fixing the number of shares of such series.
V.
In furtherance and not in limitation of the powers conferred by statute,
the Board of Directors of this Corporation is expressly authorized to make,
repeal, alter, amend and rescind the Bylaws of this Corporation.
VI.
Election of directors at an annual or special meeting of stockholders
need not be by written ballot unless the Bylaws of this Corporation shall so
provide.
VII.
A director shall not be personally liable to this Corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director;
provided that this provision shall not eliminate or limit the liability of a
director (i) for any breach of his duty of loyalty to this Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of the law, (iii) under Section
174 of the General Corporation Law of Delaware, or (iv) for any transaction from
which the director derives an improper personal benefit.
VIII.
This Corporation reserves the right to amend, alter, change or repeal any
provision contained in this Certificate of Incorporation, in the manner now or
hereafter prescribed by statute, and all rights conferred on stockholders herein
are granted subject to this reservation.
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<PAGE>
CERTIFICATE OF SECRETARY OF
NFC MERGER CORPORATION
A DELAWARE CORPORATION
I, Phillip W. Rose, Secretary of NFC Merger Corporation, a Delaware
corporation (the "Company"), do hereby certify that the Agreement of Merger, to
which this Certificate is attached, after having been submitted to and duly
approved by the Board of Directors of the Company and signed by the President of
the Company, was then consented to in writing by the sole stockholder of the
Company.
IN WITNESS WHEREOF, I have hereunto subscribed my name this 24th day of
January, 1988.
[ILLEGIBLE]
----------------------------------------
Secretary
<PAGE>
Exhibit 3.30
First Revised Page 1
Effective: February 9, 1988
BYLAWS
of
ALLIED VAN LINES, INC.
a Delaware Corporation
ARTICLE I
OFFICES
Section 1.1 REGISTERED OFFICE. The registered office of ALLIED VAN
LINES, INC. (hereinafter called the "Corporation") shall be at such place in the
State of Delaware as shall be designated by the Board of Directors (hereinafter
called the "Board").
Section 1.2 PRINCIPAL OFFICE. The principal office for the
transaction of the business of the Corporation shall be at such location, within
or without the State of Delaware, as shall be designated by the Board.
Section 1.3 OTHER OFFICES. The Corporation may also have an office
or offices at such other place or places, either within or without the State of
Delaware, as the Board may from time to time determine or as the business of the
Corporation my require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 2.1 ANNUAL MEETINGS. Annual meetings of the stockholders of
the Corporation for the purpose of electing directors and for the transaction of
such other proper business as may come before such meetings may be held at such
time, date and place as the Board shall determine by resolution.
Section 2.2 SPECIAL MEETINGS. Special meetings of the stockholders
of the Corporation for any purpose or purposes may be called at any time by the
Board, or by a committee of the Board which has been duly designated by the
Board and whose powers and authority, as provided in a resolution of the Board
or in the Bylaws, include the power to call such meetings, but such special
meetings may not be
<PAGE>
Original Page 2
called by any other person or persons; provided, however, that if and to the
extent that any special meeting of stockholders may be called by any other
person or persons specified in any provisions of the Certificate of
Incorporation or any amendment thereto or any certificate filed under Section
151(g) of the General Corporation Law of Delaware (or its successor statute as
in effect from time to time hereafter), then such special meeting may also be
called by the person or persons, in the manner, at the time and for the purposes
so specified.
Section 2.3 PLACE OF MEETINGS. All meetings of the stockholders
shall be held at such places, within or without the State of Delaware, as may
from time to time be designated by the person or persons calling the respective
meetings and specified in the respective notices or waivers of notice thereof.
Section 2.4 NOTICE OF MEETINGS. Except as otherwise required by law,
notice of each meeting of the stockholders, whether annual or special, shall be
given not less than ten (10) nor more than sixty (60) days before the date of
the meeting to each stockholder of record entitled to vote at such meeting by
delivering a typewritten or printed notice thereof to him personally, or by
depositing such notice in the United States mail, in a postage prepaid envelope,
directed to him at his address furnished by him to the Secretary of the
Corporation for such purpose or, if he shall not have furnished to the Secretary
his address for such purpose, then at his address last known to the Secretary,
or by transmitting a notice thereof to him at such address by telegraph, cable
or wireless. Except as otherwise expressly required by law, no publication of
any notice of a meeting of the stockholders shall be required. Every notice of a
meeting of the stockholders shall state the place, date and hour of the meeting,
and, in the case of a special meeting shall also state the purpose or purposes
for which the meeting is called. Except as otherwise expressly required by law,
notice of any adjourned meeting of the stockholders need not be given if the
time and place thereof are announced at the meeting at which the adjournment is
taken.
Whenever notice is required to be given to any stockholder to whom
(i) notice of two consecutive annual meetings, and all notices of meetings or of
the taking of action by written consent without a meeting to such person during
the period between such two consecutive annual meetings, or (ii) all, and at
least two, payments (if sent by first class mail) of dividends or interest on
securities during a twelve month period, have been mailed addressed to
-2-
<PAGE>
Original Page 3
such person at his address as shown on the records of the corporation and have
been returned undeliverable, the giving of such notice to such person shall not
be required. Any action or meeting which shall be taken or held without notice
to such person shall have the same force and effect as if such notice had been
duly given. If any person shall deliver to the corporation a written notice
setting forth his then current address, the requirement that notice be given to
such person shall be reinstated.
Section 2.5 QUORUM. Except as provided by law, the holders of record
of a majority in voting interest of the shares of stock of the Corporation
entitled to be voted, present in person or by proxy, shall constitute a quorum
for the transaction of business at any meeting of the stockholders of the
Corporation or any adjournment thereof. The stockholders present at a duly
called or held meeting at which a quorum is present may continue to do business
until adjournment, notwithstanding the withdrawal of enough stockholders to
leave less than a quorum. In the absence of a quorum at any meeting or any
adjournment thereof, a majority in voting interest of the stockholders present
in person or by proxy and entitled to vote thereat or, in the absence therefrom
of all the stockholders, any officer entitled to preside at or to act as
secretary of such meeting may adjourn such meeting from time to time. At any
such adjourned meeting at which a quorum is present any business may be
transacted which might have been transacted at the meeting as originally called.
Section 2.6 VOTING.
(a) Each stockholder shall be entitled to vote in person or by
proxy each share or fractional share of the stock of the Corporation which has
voting rights on the matter in question and which shall have been held by him
and registered in his name on the books of the Corporation:
(i) on the date fixed pursuant to Section 2.10 of these
Bylaws as the record date for the determination of stockholders entitled to
notice of and to vote at such meeting, or
(ii) if no such record date shall have been so fixed,
then (A) at the close of business on the day next preceding the day on which
notice of the meeting shall be given or (B) if notice of the meeting shall be
waived, at the close of business on the day next preceding the day on which the
meeting shall be held.
-3-
<PAGE>
Original Page 4
(b) Shares of its own stock belonging to the Corporation or to
another corporation, if a majority of the shares entitled to vote in the
election of directors in such other corporation is held, directly or indirectly,
by the Corporation, shall neither be entitled to vote nor be counted for quorum
purposes. Persons holding stock of the Corporation in a fiduciary capacity shall
be entitled to vote such stock. Persons whose stock is pledged shall be entitled
to vote, unless in the transfer by the pledgor on the books of the Corporation
he shall have expressly empowered the pledgee to vote thereon, in which case
only the pledgee, or his proxy, may represent such stock and vote thereon. Stock
having voting power standing of record in the names of two or more persons,
whether fiduciaries, members of a partnership, joint tenants, tenants in common,
tenants by the entirety or otherwise, or with respect to which two or more
persons have the same fiduciary relationship, shall be voted in accordance with
the provisions of the General Corporation Law of Delaware.
(c) Any such voting rights may be exercised by the stockholder
entitled thereto in person or by his proxy appointed by an instrument in
writing, subscribed by such stockholder or by his attorney thereunto authorized
and delivered to the secretary of the meeting; provided, however, that no proxy
shall be voted or acted upon after three years from its date unless said proxy
shall provide for a longer period. The attendance at any meeting of a
stockholder who may theretofore have given a proxy shall not have the effect of
revoking the same unless he shall in writing so notify the secretary of the
meeting prior to the voting of the proxy. At any meeting of the stockholders all
matters, except as otherwise provided in the Certificate of Incorporation, in
these Bylaws or by law, shall be decided by the vote of a majority in voting
interest of the stockholders present in person or by proxy and entitled to vote
thereat and thereon. The vote at any meeting of the stockholders on any question
need not be by ballot, unless so directed by the chairman of the meeting. On a
vote by ballot, each ballot shall be signed by the stockholder voting, or by his
proxy if there by such proxy, and it shall state the number of shares voted.
Section 2.7 LIST OF STOCKHOLDERS. The Secretary of the Corporation
shall prepare and make, at least ten (10) days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting,
-4-
<PAGE>
Original Page 5
during ordinary business hours, for a period of at least ten (10) days prior to
the meeting, either at a place within the city where the meeting is to be held,
which place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be held. The list shall also be
produced and kept at the time and place of the meeting during the entire
duration thereof, and may be inspected by any stockholder who is present.
Section 2.8 INSPECTOR OF ELECTION. If at any meeting of the
stockholders a vote by written ballot shall be taken on any question, the
chairman of such meeting may appoint an inspector or inspectors of election to
act with respect to such vote. Each inspector so appointed shall first subscribe
an oath faithfully to execute the duties of an inspector at such meeting with
strict impartiality and according to the best of his ability. Such inspectors
shall decide upon the qualification of the voters and shall report the number of
shares represented at the meeting and entitled to vote on such question, shall
conduct and accept the votes, and, when the voting is completed, shall ascertain
and report the number of shares voted respectively for and against the question.
Reports of the inspectors shall be in writing and subscribed and delivered by
them to the Secretary of the Corporation. Inspectors need not be stockholders of
the Corporation, and any officer of the Corporation may be an inspector on any
question other than a vote for or against a proposal in which he shall have a
material interest.
Section 2.9 STOCKHOLDER ACTION WITHOUT MEETINGS. Any action required
by the General Corporation Law of Delaware to be taken at any annual or special
meeting of the stockholders, or any action which may be taken at any annual or
special meeting of the stockholders, may be taken without a meeting, without
prior notice and without a vote, if a consent in writing setting forth the
action so taken shall be signed by the holders of outstanding stock having not
less than the minimum number of votes that would be necessary to authorize or
take such action at a meeting at which all shares entitled to vote thereon were
present and voted. Prompt notice of the taking of the corporate action without a
meeting by less than unanimous written consent shall be given to those
stockholders who have not consented in writing.
Section 2.10 RECORD DATE. In order that the Corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
the stockholders or any adjournment thereof, or entitled to receive payment of
any dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any other
-5-
<PAGE>
First Revised Page 6
Effective: February 9, 1988
change, conversion or exchange of stock or for the purpose of any other lawful
action, the Board may fix, in advance, a record date, which shall not be more
than sixty (60) nor less than ten (10) days before the date of such meeting, nor
more than sixty (60) days prior to any other action. If, in any case involving
the determination of stockholders for any purpose other than notice of or voting
at a meeting of stockholders, the Board shall not fix such a record date, the
record date for determining stockholders for such purpose shall be the close of
business on the day on which the Board shall adopt the resolution relating
thereto. A determination of stockholders entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of such meeting;
provided, however, that the Board may fix a new record date for the adjourned
meeting.
ARTICLE III
BOARD OF DIRECTORS
Section 3.1 GENERAL POWERS. The property, business and affairs of
the Corporation shall be managed by or under the direction of the Board, which
may exercise all of the powers of the Corporation, except such as are by the
Certificate of Incorporation, by these Bylaws or by law conferred upon or
reserved to the stockholders.
Section 3.2 NUMBER AND TERM. The authorized number of directors
shall be a minimum of one and a maximum of nineteen until changed by a duly
adopted amendment to these Bylaws. The number of directors at any given time
shall be the number elected by the stockholders of the Corporation at each
annual meeting or at a special meeting called for the purpose of electing
directors or by unanimous consent of the stockholders in lieu of a meeting. Each
director shall hold office until the next annual meeting and until a successor
has been elected and qualified, or resigns, or is removed consistent with these
Bylaws.
Section 3.3 ELECTION OF DIRECTORS. The directors shall be elected by
the stockholders of the Corporation, and at each election the persons receiving
the greatest number of votes, up to the number of directors then to be elected,
shall be the persons then elected. The election of directors is subject to any
provisions contained in the Certificate of Incorporation relating thereto,
including any provisions for a classified board.
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Section 3.4 RESIGNATION AND REMOVAL. Any director of the Corporation
may resign at any time by giving written notice to the Board or to the Secretary
of the Corporation. Any such resignation shall take effect at the time specified
therein, or, if the time is not specified, it shall take effect immediately upon
its receipt; and, unless otherwise specified therein, the acceptance of such
resignation shall not be necessary to make it effective.
Subject to any provisions which may be contained in the Certificate
of Incorporation relating to election of directors or a classified board, any
director or the entire board of directors may be removed, with or without cause,
by the holders of a majority of shares then entitled to vote at an election of
directors.
Section 3.5 VACANCIES. Except as otherwise provided in the
Certificate of Incorporation, any vacancy in the Board, whether because of
death, resignation, disqualification, an increase in the number of directors, or
any other cause, may be filled by vote of the majority of the remaining
directors, although less than a quorum, or by a sole remaining director. Each
director so chosen to fill a vacancy shall hold office until his successor shall
have been elected and shall qualify or until he shall resign or shall have been
removed. No reduction of the authorized number of directors shall have the
effect of removing any director prior to the expiration of his term of office.
Upon the resignation of one or more directors from the Board,
effective at a future date, a majority of the directors then in office,
including those who have so resigned, shall have the power to fill such vacancy
or vacancies, the vote thereon to take effect when such resignation or
resignations shall become effective, and each director so chosen shall hold
office as provided hereinabove in the filling of other vacancies.
Section 3.6 PLACE OF MEETING; TELEPHONE CONFERENCE MEETING. The
Board may hold any of its meetings at such place or places within or without the
State of Delaware as the Board may from time to time by resolution designate or
as shall be designated by the person or persons calling the meeting or in the
notice or waiver of notice of any such meeting. Directors may participate in any
regular or special meeting of the Board by means of conference telephone or
similar communications equipment pursuant to which all persons participating in
the meeting of the Board can hear each other, and such participation shall
constitute presence in person at such meeting.
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Section 3.7 FIRST MEETING. The Board shall meet as soon as
practicable after each annual election of directors and notice of such first
meeting shall not be required.
Section 3.8 REGULAR MEETINGS. Regular meetings of the Board may be
held at such times as the Board shall from time to time by resolution determine.
If any day fixed for a meeting shall be a legal holiday at the place where the
meeting is to be held, then the meeting shall be held at the same hour and place
on the next succeeding business day which is not a legal holiday. Except as
provided by law, notice of regular meetings need not be given.
Section 3.9 SPECIAL MEETINGS. Special meetings of the Board may be
called at any time by the Chairman of the Board, if any, the President or by any
director, to be held at the principal office of the Corporation, or at such
other place or places, within or without the State of Delaware, as the person or
persons calling the meeting may designate.
Notice of the time and place of special meetings shall be given to
each director either (i) by mailing or otherwise sending to him a written notice
of such meeting, charges prepaid, addressed to him at his address as it is shown
upon the records of the Corporation, or if it is not so shown on such records or
is not readily ascertainable, at the place in which the meetings of the
directors are regularly held, at least seventy-two (72) hours prior to the time
of the holding of such meeting; or (ii) by orally communicating the time and
place of the special meeting to him at least forty-eight (48) hours prior to the
time of the holding of such meeting. Either of the notices as above provided
shall be due, legal and personal notice to such director.
Whenever notice is required to be given, either to a stockholder or
a director, under any provision of the General Corporation Law of Delaware, the
Certificate of Incorporation or these Bylaws, a written waiver thereof, signed
by the person entitled to notice, whether before or after the time stated
therein, shall be deemed equivalent to notice. Attendance of a person at a
meeting, whether in person or by proxy, shall constitute a waiver of notice of
such meeting, except when the person attends a meeting for the express purpose
of objecting, at the beginning of the meeting, to the transaction of any
business because the meeting is not lawfully called or convened. Neither the
business to be transacted at nor the purpose of any regular or special meeting
of directors or committee of directors need be specified in any written waiver
of notice.
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All such waivers shall be filed with the corporate records or made a
part of the minutes of the meeting.
Section 3.10 QUORUM AND ACTION. Except as otherwise provided in
these Bylaws or by law, the presence of a majority of the authorized number of
directors shall be required to constitute a quorum for the transaction of
business at any meeting of the Board, and all matters shall be decided at any
such meeting, a quorum being present, by the affirmative votes of a majority of
the directors present. In the absence of a quorum, a majority of directors
present at any meeting may adjourn the same from time to time until a quorum
shall be present. Notice of any adjourned meeting need not be given. The
directors shall act only as a Board, and the individual directors shall have no
power as such.
Section 3.11 ACTION BY CONSENT. Any action required or permitted to
be taken at any meeting of the Board or of any committee thereof may be taken
without a meeting if a written consent thereto is signed by all members of the
Board or of such committee, as the case may be, and such written consent is
filed with the minutes of proceedings of the Board or such committee. Such
action by written consent shall have the same force and effect as the unanimous
vote of such directors.
Section 3.12 COMPENSATION. No stated salary need be paid to
directors, as such, for their services but, as fixed from time to time by
resolution of the Board, the directors may receive directors' fees, compensation
and reimbursement for expenses for attendance at directors' meetings, for
serving on committees and for discharging their duties; provided that nothing
herein contained shall be construed to preclude any director from serving the
Corporation in any other capacity and receiving compensation therefor.
Section 3.13 COMMITTEES. The Board may, by resolution passed by a
majority of the whole Board, designate one or more committees, each committee to
consist of one or more of the directors of the Corporation. Any such committee,
to the extent provided in the resolution of the Board, shall have and may
exercise all the powers and authority of the Board in the management of the
business and affairs of the Corporation, and may authorize the seal of the
Corporation to be affixed to all papers which may require it; but no such
committee shall have any power or authority in reference to amending the
Certificate of Incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the Corporation's property and assets, recommending to the
stockholders a dissolution of the
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Corporation or a revocation of a dissolution, or amending the Bylaws of the
Corporation; and, unless the resolution of the Board expressly so provides, no
such committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock. Any such committee shall keep written minutes
of its meetings and report the same to the Board when required.
In the absence or disqualification of any member of any such
committee, the members thereof present at any meeting and not disqualified from
voting, whether or not they constitute a quorum, may appoint another member of
the Board to act at the meeting in the place of such absent or disqualified
member.
A majority of the members, or replacements thereof, of any such
committee shall constitute a quorum for the transaction of business. Every act
or decision done or made by a majority of the members, or replacements thereof,
of any such committee shall be regarded as the act or decision of the entire
committee.
ARTICLE IV
OFFICERS
Section 4.1 OFFICERS. The officers of the Corporation shall be a
President, a Secretary and a Treasurer. The Corporation may also have, at the
discretion of the Board, a Chairman of the Board, one or more Vice Presidents,
one or more Assistant Vice Presidents, one or more Assistant Secretaries, one or
more Assistant Treasurers and such other officers as may be appointed in
accordance with the provisions of Section 4.3 of these Bylaws. One person may
hold two or more offices.
Section 4.2 ELECTION AND TERM. The officers of the Corporation,
except such officers as may be appointed in accordance with the provisions of
Section 4.3 or Section 4.5 of these Bylaws, shall be chosen annually by the
Board, and each shall hold his office until he shall resign or shall be removed
or otherwise disqualified to serve, or until his successor shall be elected and
qualified.
Section 4.3 SUBORDINATE OFFICERS. The Board may appoint, or may
authorize the President to appoint, such other officers as the business of the
Corporation may require, each of whom shall have such authority and perform such
duties as are provided in these Bylaws or as the Board or the President from
time to time may specify, and shall hold office until he
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shall resign or shall be removed or otherwise disqualified to serve.
Section 4.4 REMOVAL AND RESIGNATION. Any officer may be removed,
with or without cause, by a majority of the directors at the time in office, at
any regular or special meeting of the Board, or, except in case of an officer
chosen by the Board, by the President upon whom such power of removal may be
conferred by the Board.
Any officer may resign at any time by giving written notice to the
Board, the Chairman of the Board, if any, the President or the Secretary of the
Corporation. Any such resignation shall take effect at the date of the receipt
of such notice or at any later time specified therein; and unless otherwise
specified therein, the acceptance of such resignation shall not be necessary to
make it effective.
Section 4.5 VACANCIES. A vacancy in any office because of death,
resignation, removal, disqualification or any other cause shall be filled in the
manner prescribed in the Bylaws for the regular appointments to such office.
Section 4.6 CHAIRMAN OF THE BOARD. The Chairman of the Board, if
any, shall preside at all meetings of the stockholders and the Board and shall
have such other powers and duties as may from time to time be assigned to him by
the Board or prescribed in the Bylaws.
Section 4.7 PRESIDENT. The President of the Corporation shall,
subject to the control of the Board, have general supervision, direction and
control of the business and affairs of the Corporation. He shall preside at all
meetings of stockholders and the Board. He shall have the general powers and
duties of management usually vested in the chief executive officer of a
corporation, and shall have such other powers and duties with respect to the
administration of the business and affairs of the Corporation as may from time
to time be assigned to him by the Board or as prescribed by the Bylaws.
Section 4.8 VICE PRESIDENT. The Vice President(s), if any, shall
exercise and perform such powers and duties with respect to the administration
of the business and affairs of the Corporation as from time to time may be
assigned to each of them by the President, by the Board or as is prescribed by
the Bylaws. In the absence or disability of the President, the Vice Presidents,
in order of their rank as fixed by the Board, or if not ranked, the Vice
President designated by the Board, shall perform all of the duties of the
President and
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when so acting shall have all of the powers of and be subject to all the
restrictions upon the President.
Section 4.9 SECRETARY. The Secretary shall keep, or cause to be
kept, a book of minutes at the principal office for the transaction of the
business of the Corporation, or such other place as the Board may order, of all
meetings of directors and stockholders, with the time and place of holding,
whether regular or special, and if special, how authorized and the notice
thereof given, the names of those present at directors' meetings, the number of
shares present or represented at stockholders' meetings and the proceedings
thereof.
The Secretary shall keep, or cause to be kept, at the principal
office for the transaction of the business of the Corporation or at the office
of the Corporation's transfer agent, a share register, or a duplicate share
register, showing the names of the stockholders and their addresses, the number
and classes of shares held by each, the number and date of certificates issued
for the same, and the number and date of cancellation of every certificate
surrendered for cancellation.
The Secretary shall give, or cause to be given, notice of all the
meetings of the stockholders and of the Board required by these Bylaws or by law
to be given, and he shall keep the seal of the Corporation in safe custody, and
shall have such other powers and perform such other duties as may be prescribed
by the Board or these Bylaws. If for any reason the Secretary shall fail to give
notice of any special meeting of the Board called by one or more of the persons
identified in Section 3.9 of these Bylaws, or if he shall fail to give notice of
any special meeting of the stockholders called by one or more of the persons
identified in Section 2.2 of these Bylaws, then any such person or persons may
give notice of any such special meeting.
Section 4.10 TREASURER. The Treasurer shall keep and maintain or
cause to be kept and maintained, adequate and correct accounts of the properties
and business transactions of the Corporation, including accounts of its assets,
liabilities, receipts, disbursements, gains, losses, capital, surplus and
shares. Any surplus, including earned surplus, paid-in surplus and surplus
arising from a reduction of capital, shall be classified according to source and
shown in a separate account. The books of account at all reasonable times shall
be open to inspection by any director.
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The Treasurer shall deposit all moneys and other valuables in the
name and to the credit of the Corporation with such depositories as may be
designated by the Board. He shall disburse the funds of the Corporation as may
be ordered by the Board, shall render to the President and to the directors,
whenever they request it, an account of all of his transactions as Treasurer and
of the financial condition of the Corporation, and shall have such other powers
and perform such other duties as may be prescribed by the Board or these Bylaws.
4.11 COMPENSATION. The compensation of the officers of the
Corporation shall be fixed from time to time by the Board.
ARTICLE V
CONTRACTS, CHECKS, DRAFTS, BANK ACCOUNTS, ETC.
Section 5.1 EXECUTION OF CONTRACTS. The Board, except as otherwise
provided in these Bylaws, may authorize any officer or officers, agent or
agents, to enter into any contract or execute any instrument in the name and on
behalf of the Corporation, and such authority may be general or confined to
specific instances; and unless so authorized by the Board or by these Bylaws, no
officer, agent or employee shall have any power or authority to bind the
Corporation by any contract or engagement or to pledge its credit or to render
it liable for any purpose or in any amount.
Section 5.2 CHECKS, DRAFTS, ETC. All checks, drafts or other orders
for payment of money, notes or other evidence of indebtedness, issued in the
name of or payable to the Corporation, shall be signed or endorsed by such
person or persons and in such manner as, from time to time, shall be determined
by resolution of the Board. Each such person shall give such bond, if any, as
the Board may require.
Section 5.3 DEPOSITS. All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the Corporation
in such banks, trust companies or other depositories as the Board may select, or
as may be selected by any officer or officers, assistant or assistants, agent or
agents, attorney or attorneys, of the Corporation to whom such power shall have
been delegated by the Board. For the purpose of deposit and for the purpose of
collection for the account of the Corporation, the President, any Vice President
or the Treasurer (or any other officer or officers, assistant or assistants,
agent or agents, or attorney or
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attorneys of the Corporation who shall be determined by the Board from time to
time) may endorse, assign and deliver checks, drafts and other orders for the
payment of money which are payable to the order of the Corporation.
Section 5.4 GENERAL AND SPECIAL BANK ACCOUNTS. The Board from time
to time may authorize the opening and keeping of general and special bank
accounts with such banks, trust companies or other depositories as the Board may
select or as may be selected by an officer or officers, assistant or assistants,
agent or agents, or attorney or attorneys of the Corporation to whom such power
shall have been delegated by the Board. The Board may make such special rules
and regulations with respect to such bank accounts, not inconsistent with the
provisions of these Bylaws, as it may deem expedient.
ARTICLE VI
SHARES AND THEIR TRANSFER
Section 6.1 CERTIFICATES FOR STOCK. The shares of the Corporation
shall be represented by certificates, provided that the Board may provide by
resolution or resolutions that some of all of any or all classes of stock shall
be uncertified shares. Any such resolution shall not apply to shares represented
by a certificate until such certificate is tendered to the Corporation.
Notwithstanding the adoption of such a resolution, every holder of stock
represented by certificates, and upon request every holder of uncertified
shares, shall be entitled to have a certificate, in such form as the Board shall
prescribe, signed by, or in the name of, the Corporation by the Chairman of the
Board, the President or a Vice President and by the Secretary or an Assistant
Secretary or by the Treasurer or an Assistant Treasurer representing the number
of shares registered in certificate form. Any or all of the signatures on the
certificates may be a facsimile. In case any officer, transfer agent or
registrar who has signed or whose facsimile signature has been placed upon any
such certificate shall thereafter have ceased to be such officer, transfer agent
or registrar before such certificate is issued, such certificate may
nevertheless be issued by the Corporation with the same effect as though the
person who signed such certificate, or whose facsimile signature shall have been
placed thereupon, were such officer, transfer agent or registrar at the date of
issue. A record shall be kept of the respective names of the persons, firms or
corporations owning the the stock represented by such certificates, the number
and class of shares represented by
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such certificates, respectively, and the respective dates thereof, and in case
of cancellation, the respective dates of cancellation. Every certificate
surrendered to the Corporation for exchange or transfer shall be cancelled, and
no new certificate or certificates shall be issued in exchange for any existing
certificate until such existing certificate shall have been so cancelled, except
in cases provided for in Section 6.4 of these Bylaws.
Section 6.2 TRANSFER OF STOCK. Transfer of shares of stock of the
Corporation shall be made only on the books of the Corporation by the registered
holder thereof, or by his attorney thereunto authorized by power of attorney
duly executed and filed with the Secretary, or with a transfer clerk or a
transfer agent appointed as provided in Section 6.3 of these Bylaws, and upon
surrender of the certificate or certificates for such shares properly endorsed
and the payment of all taxes thereon. The person in whose name shares of stock
stand on the books of the Corporation shall be deemed the owner thereof for all
purposes as regards the Corporation. Whenever any transfer of shares shall be
made for collateral security, and not absolutely, such fact shall be stated
expressly in the entry of transfer if, when the certificate or certificates
shall be presented to the Corporation for transfer, both the transferor and the
transferee request the Corporation to do so.
Section 6.3 REGULATIONS. The Board may make such rules and
regulations as it may deem expedient, not inconsistent with these Bylaws,
concerning the issue, transfer and registration of certificates for shares of
the stock of the Corporation. The Board may appoint, or authorize any officer or
officers to appoint, one or more transfer clerks or one or more transfer agents
and one or more registrars, and may require all certificates for stock to bear
the signature or signatures of any of them.
Section 6.4 LOST, STOLEN, DESTROYED AND MUTILATED CERTIFICATES. In
any case of loss, theft, destruction, or mutilation of any certificate of stock,
another may be issued in its place upon proof of such loss, theft, destruction,
or mutilation and upon the giving of a bond of indemnity to the Corporation in
such form and in such sums as the Board may direct; provided, however, that a
new certificate may be issued without requiring any bond when, in the judgment
of the Board, it is proper to do so.
Section 6.5 REPRESENTATION OF SHARES OF OTHER CORPORATIONS. The
President or any Vice President and the Secretary or any Assistant Secretary of
this Corporation are
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authorized to vote, represent and exercise on behalf of this Corporation all
rights incident to all shares of any other corporation or corporations standing
in the name of this Corporation. The authority herein granted to said officers
to vote or represent on behalf of this Corporation any and all shares held by
this Corporation in any other corporation or corporations may be exercised
either by such officers in person or by any person authorized so to do by proxy
or power of attorney duly executed by said officers.
ARTICLE VII
INDEMNIFICATION
Section 7.1 ACTIONS OTHER THAN BY OR IN THE RIGHT OF THE
CORPORATION. The Corporation shall indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Corporation) by reason of the
fact that he is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise or as a member of any committee or similar
body, against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection with
such action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
Corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in, or not opposed to, the best interests of the
Corporation, and, with respect to any criminal action or proceeding, that he had
reasonable cause to believe that his conduct was unlawful.
Section 7.2 ACTIONS BY OR IN THE RIGHT OF THE CORPORATION. The
Corporation shall indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action or suit by or in
the right of the Corporation to procure a judgment in its favor by reason of the
fact that he is or was a director, officer, employee or agent of the
Corporation, or is or was serving at
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the request of the Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise, or
as a member of any committee or similar body, against expenses (including
attorneys' fees) actually and reasonably incurred by him in connection with the
defense or settlement of such action or suit if he acted in good faith and in a
manner he reasonably believed to be in, or not opposed to, the best interests of
the Corporation, except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the Corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
Section 7.3 DETERMINATION OF RIGHT OF INDEMNIFICATION. Any
indemnification under Section 7.1 or 7.2 of these Bylaws (unless ordered by a
court) shall be made by the Corporation only as authorized in the specific case
upon a determination that indemnification of the director, officer, employee or
agent is proper in the circumstances because he has met the applicable standard
of conduct set forth in Sections 7.1 and 7.2 of these Bylaws. Such determination
shall be made (i) by the Board by a majority vote of a quorum consisting of
directors who were not parties to such action, suit or proceeding, or (ii) if
such a quorum is not obtainable, or, even if obtainable, a quorum of
disinterested directors so directs, by independent legal counsel in a written
opinion, or (iii) by the stockholders.
Section 7.4 INDEMNIFICATION AGAINST EXPENSES OF SUCCESSFUL PARTY.
Notwithstanding the other provisions of this Article VII, to the extent that a
director, officer, employee or agent of the Corporation has been successful on
the merits or otherwise in defense of any action, suit or proceeding referred to
in Section 7.1 or 7.2 of these Bylaws, or in defense of any claim, issue or
matter therein, he shall be indemnified against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection therewith.
Section 7.5 ADVANCE OF EXPENSES. Expenses incurred by an officer or
director in defending a civil or criminal action, suit or proceeding may be paid
by the Corporation in advance of the final disposition of such action, suit or
proceeding as authorized by the Board upon receipt of an
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undertaking by or on behalf of the director or officer, to repay such amount if
it shall ultimately be determined that he is not entitled to be indemnified by
the Corporation as authorized in this Article VII. Such expenses incurred by
other employees and agents may be so paid upon such terms and conditions, if
any, as the Board deems appropriate.
Section 7.6 OTHER RIGHTS AND REMEDIES. The indemnification and
advancement of expenses provided by, or granted pursuant to, the other Sections
of this Article VII shall not be deemed exclusive and are declared expressly to
be nonexclusive of any other rights to which those seeking indemnification or
advancements of expenses may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office.
Section 7.7 INSURANCE. Upon resolution passed by the Board, the
Corporation may purchase and maintain insurance on behalf of any person who is
or was a director, officer, employee or agent of the Corporation, or is or was
serving at the request of the Corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise or as a member of any committee or similar body against any liability
asserted against him and incurred by him in any such capacity, or arising out of
his status as such, whether or not the Corporation would have the power to
indemnify him against such liability under the provisions of this Article VII.
Section 7.8 CONSTITUENT CORPORATIONS. For the purposes of this
Article VII, references to "the Corporation" include in addition to the
resulting corporation, any constituent corporation (including any constituent of
a constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers and employees or agents, so that any person who is or was a
director, officer, employee or agent of such constituent corporation or is or
was serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise or as a member of any committee or similar body shall
stand in the same position under the provisions of this Article VII with respect
to the resulting or surviving corporation as he would have with respect to such
constituent corporation if its separate existence had continued.
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Section 7.9 EMPLOYEE BENEFIT PLANS. For the purposes of this Article
VII, references to "other enterprises" shall include employee benefit plans;
references to "fines" shall include any excise taxes assessed on a person with
respect to any employee benefit plan; and references to "serving at the request
of the Corporation" shall include any service as a director, officer, employee
or agent of the Corporation which imposes duties on, or involves services by,
such director, officer, employee or agent with respect to an employee benefit
plan, its participants or beneficiaries; and a person who acted in good faith
and in a manner he reasonably believed to be in the interest of the participants
and beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interests of the Corporation" as referred to in
this Article VII.
Section 7.10. BROADEST LAWFUL INDEMNIFICATION. In addition to the
foregoing, the Corporation shall, to the broadest and maximum extent permitted
by Delaware law, as the same exists from time to time (but, in case of any
amendment to or change in Delaware law, only to the extent that such amendment
or change permits the Corporation to provide broader rights of indemnification
than is permitted to the Corporation prior to such amendment or change),
indemnify each person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative by reason of the fact that he
is or was a director or officer of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding. In addition, the Corporation shall, to the broadest
and maximum extent permitted by Delaware law, as the same may exist from time to
time (but, in case of any amendment to or change in Delaware law, only to the
extent that such amendment or change permits the Corporation to provide broader
rights of payment of expenses incurred in advance of the final disposition of an
action, suit or proceeding than is permitted to the Corporation prior to such
amendment or change), pay to such person any and all expenses (including
attorneys' fees) incurred in defending or settling any such action, suit or
proceeding in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of the director or
officer, to repay such amount if it shall ultimately be determined by a final
judgment or other final adjudication that he is not entitled to be indemnified
by the Corporation
-19-
<PAGE>
Original Page 20
as authorized in this Section 7.10. The first sentence of this Section 7.10 to
the contrary notwithstanding, the Corporation shall not indemnify any such
person with respect to any of the following matters: (i) remuneration paid to
such person if it shall be determined by a final judgment or other final
adjudication that such remuneration was in violation of law; or (ii) any
accounting of profits made from the purchase or sale by such person of the
Corporation's securities within the meaning of Section 16(b) of the Securities
Exchange Act of 1934 and amendments thereto or similar provisions of any
federal, state or local statutory law; or (iii) actions brought about or
contributed to by the dishonesty of such person, if a final judgment or other
final adjudication adverse to such person establishes that acts of active and
deliberate dishonesty were committed or attempted by such person with actual
dishonest purpose and intent and were material to the adjudication; or (iv)
actions based on or attributable to such person having gained any personal
profit or advantage to which he was not entitled, in the event that a final
judgment or other final adjudication adverse to such person establishes that
such person in fact gained such personal profit or other advantage to which he
was not entitled; or (v) any matter in respect of which a final decision by a
court with competent jurisdiction shall determine that indemnification is
unlawful; provided, however, that the Corporation shall perform its obligations
under the second sentence of this Section 7.10 on behalf of such person until
such time as it shall be ultimately determined by a final judgment or other
final adjudication that he is not entitled to be indemnified by the Corporation
as authorized by the first sentence of this Section 7.10 by virtue of any of the
preceding clauses (i), (ii), (iii), (iv) or (v).
Section 7.11. TERM. The indemnification and advancement of expenses
provided by, or granted pursuant to, this Article VII shall, unless otherwise
provided when authorized or ratified, continue as to a person who has ceased to
be a director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
Section 7.12 SEVERABILITY. If any part of this Article VII shall be
found, in any action, suit or proceeding or appeal therefrom or in any other
circumstances or as to any particular officer, director, employee or agent to be
unenforceable, ineffective or invalid for any reason, the enforceability, effect
and validity of the remaining parts or of such parts in other circumstances
shall not be affected, except as otherwise required by applicable law.
-20-
<PAGE>
Original Page 21
Section 7.13 AMENDMENTS. The foregoing provisions of this Article
VII shall be deemed to constitute an agreement between the Corporation and each
of the persons entitled to indemnification hereunder, for as long as such
provisions remain in effect. Any amendment to the foregoing provisions of this
Article VII which limits or otherwise adversely affects the scope of
indemnification or rights of any such persons hereunder shall, as to such
persons, apply only to claims arising, or causes of action based on actions or
events occurring, after such amendment and delivery of notice of such amendment
is given to the person or persons so affected. Until notice of such amendment is
given to the person or persons whose rights hereunder are adversely affected,
such amendment shall have no effect on such rights of such persons hereunder.
Any person entitled to indemnification under the foregoing provisions of this
Article VII shall, as to any act or omission occurring prior to the date of
receipt of such notice, be entitled to indemnification to the same extent as had
such provisions continued as Bylaws of the Corporation without such amendment.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 SEAL. The Board shall provide a corporate seal, which
shall be in the form of a circle and shall bear the name of the Corporation and
words and figures showing that the Corporation was incorporated in the State of
Delaware and showing the year of incorporation.
Section 8.2 WAIVER OF NOTICES. Whenever notice is required to be
given by these Bylaws or the Certificate of Incorporation or by law, the person
entitled to said notice may waive such notice in writing, either before or after
the time stated therein, and such waiver shall be deemed equivalent to notice.
Attendance of a person at a meeting shall constitute a waiver of notice of such
meeting, except when the person attends a meeting for the express purpose of
objecting, at the beginning of the meeting, to the transaction of any business
because the meeting is not lawfully called or convened. Neither the business to
be transacted at, nor the purpose of, any regular or special meeting of the
stockholders, directors, or members of a committee of directors need be
specified in any written waiver of notice.
Section 8.3 LOANS AND GUARANTIES. The Corporation may lend money to,
or guarantee any obligation of, and otherwise assist any officer or other
employee of the
-21-
<PAGE>
Original Page 22
Corporation or of its subsidiaries, including any officer who is a director,
whenever, in the judgment of the Board, such loan, guaranty or assistance may
reasonably be expected to benefit the Corporation. The loan, guaranty, or other
assistance may be with or without interest, and may be unsecured or secured in
such manner as the Board shall approve, including, without limitation, a pledge
of shares of stock of the Corporation.
Section 8.4 GENDER. All personal pronouns used in these Bylaws shall
include the other genders, whether used in the masculine, feminine or neuter
gender, and the singular shall include the plural, and vice versa, whenever and
as often as may be appropriate.
Section 8.5 AMENDMENTS. These Bylaws, or any of them, may be
rescinded, altered, amended or repealed, and new Bylaws may be made (i) by the
Board, by vote of a majority of the number of directors then in office as
directors, acting at any meeting of the Board or (ii) by the stockholders, by
the vote of a majority of the outstanding shares of voting stock of the
Corporation, at an annual meeting of stockholders, without previous notice, or
at any special meeting of stockholders, provided that notice of such proposed
amendment, modification, repeal or adoption is given in the notice of special
meeting; provided, however, that Section 2.2 of these Bylaws can only be amended
if that Section as amended would not conflict with the Corporation's Certificate
of Incorporation. Any Bylaw made or altered by the stockholders may be altered
or repealed by the Board or may be altered or repealed by the stockholders.
-22-
<PAGE>
Exhibit 3.31
Certificate No. 30764
STATE OF ILLINOIS
OFFICE OF
THE SECRETARY OF STATE
[GRAPHIC]
To all to whom these Presents Shall Come, Greeting:
Whereas, Articles of amendment to the Articles of Incorporation duly signed and
verified of ALLIED VAN LINES INSURANCE AGENCY, INC. have been filed in the
Office of the Secretary of State on the 14th day of February A.D. 1978, as
provided by "THE BUSINESS CORPORATION ACT" of Illinois, in force July 13, A.D.
1933.
Now Therefore, I, ALAN J. DIXON, Secretary of State of the State of Illinois, by
virtue of the powers vested in me by law, do hereby issue this certificate of
amendment and attach thereto a copy of the Articles of Amendment to the Articles
of Incorporation of the aforesaid corporation.
In Testimony Whereof, I hereto set my hand and cause to be affixed the Great
Seal of the State of Illinois, Done at the City of Springfield this 14th day of
February A.D. 1978 and of the Independence of the United States the two hundred
and 2nd.
[SEAL OF THE STATE OF ILLINOIS]
/s/ Alan J. Dixon
- ---------------------------
SECRETARY OF STATE
<PAGE>
FORM BCA-55
----------------------------
(Do not write in this space)
Date Paid 2-14-78
License Fee $
Franchise Tax $
Filing Fee $25.00
Clerk
----------------------------
(File in Duplicate)
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
Allied Van Lines
Insurance Agency, Inc.
----------------------
(Exact Corporate Name)
To Alan J. Dixon
Secretary of State
Springfield, Illinois
The undersigned corporation, for the purpose of amending its Articles of
Incorporation and pursuant to the provisions of Section 55 of "The Business
Corporation Act" of the State of Illinois, hereby executes the following
Articles of Amendment:
ARTICLE FIRST: The name of the corporation is:
Allied Van Lines Insurance Agency, Inc.
ARTICLE SECOND: The following amendment or amendments were adopted in the
manner prescribed by "The Business Corporation Act" of the State of Illinois:
Article First is amended to read as follows:
"ARTICLE FIRST: The name of the corporation is:
Vanguard Insurance Agency, Inc."
(ILL. - 741 - 11/7/72)
<PAGE>
(Disregard separation into classes
if class voting does not apply to
the amendment voted on.)
ARTICLE THIRD: The number of shares of the corporation outstanding at the
time of the adoption of said amendment or amendments was One Hundred (100); and
the number of shares of each class entitled to vote as a class on the adoption
of said amendment or amendments, and the designation of each such class were as
follows:
Class Number of Shares
N/A
(Disregard separation into classes
if class voting does not apply to
the amendment voted on.)
ARTICLE FOURTH: The number of shares voted for said amendment or
amendments was One Hundred (100), and the number of shares voted against said
amendment or amendments was Zero (0). The number of shares of each class
entitled to vote as a class voted for and against said amendment or amendments,
respectively, was:
Number of Shares Voted
Class For Against
N/A
(Disregard these items unless the
amendment restates the articles of
incorporation.)
Item 1. On the date of the adoption of this amendment, restating the articles of
incorporation, the corporation had ______ shares issued, itemized as follows:
Class Series Number of Par value per share or statement
(If Any) Shares that shares are without par value
Item 2. On the date of the adoption of this amendment restating the articles of
incorporation, the corporation had a stated capital of $________ and a paid-in
surplus of $________ or a total of $_________.
(ILL - 741)
<PAGE>
(Disregard this Article where
amendment contains no such
provisions.)
ARTICLE FIFTH: The manner in which the exchange, reclassification, or
cancellation of issued shares, or a reduction of the number of authorized shares
of any class below the number of issued shares of that class, provided for in,
or effected by, this amendment, is as follows:
(Disregard this Paragraph where
amendment does not affect stated
capital or paid-in surplus.)
ARTICLE SIXTH: Paragraph 1: The manner in which said amendment or
amendments effect a change in the amount of stated capital or the amount of
paid-in surplus, or both, is as follows:
(Disregard this Paragraph where
amendment does not affect
stated-capital or paid-in surplus.)
Paragraph 2: The amounts of stated capital and of paid-in surplus as
changed by this amendment are as follows:
Before Amendment After Amendment
Stated capital ..... $ $
Paid-in surplus .... $ $
(ILL. - 741)
<PAGE>
IN WITNESS WHEREOF, the undersigned corporation has caused these Articles
of Amendment to be executed in its name by its Vice President, and its corporate
seal to be hereto affixed, attested by its Assistant Secretary, this 9th day of
February, 1978.
Allied Van Lines Insurance Agency, Inc.
---------------------------------------
(Exact Corporate Name)
By: /s/ John Ramsbottom
-----------------------------------
Its Vice President
[CORPORATE SEAL OF
ALLIED VAN LINES INSURANCE AGENCY, INC.]
ATTEST
/s/ [ILLEGIBLE]
- ---------------------------------
Its Assistant Secretary
STATE OF ILLINOIS }
} ss.
COUNTY OF COOK }
I, Evelyn K. Kalata, a Notary Public, do hereby certify that on the 9th
day of February, 1978, John C. Ramsbottom personally appeared before me and,
being first duly sworn by me, acknowledged that he signed the foregoing document
in the capacity therein set forth and declared that the statements therein
contained are true.
IN WITNESS WHEREOF, I have hereunto set my hand and seal the day and year
before written.
/s/ Evelyn K. Kalata
-----------------------------------
Notary Public
[NOTARIAL SEAL OF
EVELYN K. KALATA]
FORM BCA-55
Box 5028 File 945-1
==========================================
ARTICLES OF AMENDMENT
to the
ARTICLES OF INCORPORATION
of
ALLIED VAN LINES
INSURANCE AGENCY, INC.
FILED
FEB 14 1978
/s/ Alan J. Dixon
Secretary of State
FILE IN DUPLICATE
Filing Fee $25.00
Filing Fee for Re-Stated Articles $100.00
==========================================
(43995--15M--8-72)
<PAGE>
Certificate No. 82265
STATE OF ILLINOIS
OFFICE OF
THE SECRETARY OF STATE
[GRAPHIC]
To all to whom these Presents Shall Come, Greeting:
Whereas, Articles of Incorporation duly signed and verified of ALLIED VAN LINES
INSURANCE AGENCY, INC. have been filed in the Office of the Secretary of State
on the 9th day of August A.D. 1973, as provided by "THE BUSINESS CORPORATION
ACT" of Illinois, in force July 13, A.D. 1933.
Now Therefore, I, MICHAEL J. HOWLETT, Secretary of State of the State of
Illinois, by virtue of the powers vested in me by law, do hereby issue this
certificate of amendment and attach thereto a copy of the Articles of
Incorporation of the aforesaid corporation.
In Testimony Whereof, I hereto set my hand and cause to be affixed the Great
Seal of the State of Illinois, Done at the City of Springfield this 9th day of
August A.D. 1973 and of the Independence of the United States the one hundred
and 98th.
[SEAL OF THE STATE OF ILLINOIS]
/s/ MICHAEL J. HOWLETT
- ---------------------------
SECRETARY OF STATE
<PAGE>
FORM B C A-47
BEFORE ATTEMPTING TO EXECUTE THESE BLANKS BE SURE TO READ CAREFULLY
THE INSTRUCTIONS ON THE BACK THEREOF.
(THESE ARTICLES MUST BE FILED IN DUPLICATE)
----------------------------
(Do not write in this space)
Date Paid 8-9-73
License Fee $ .50
Franchise Tax $22.92
Filing Fee $75.00
------
Clerk 98.42
----------------------------
STATE OF ILLINOIS }
} ss.
COUNTY OF COOK }
TO MICHAEL J. HOWLETT, Secretary of State:
The undersigned,
- --------------------------------------------------------------------------------
Address
Name Number Street City State
- --------------------------------------------------------------------------------
James W. Tallant 2120 S. 25th Avenue, Broadview, Illinois
being one or more natural persons of the age of twenty-one years or more or a
corporation, and having subscribed to shares of the corporation to be organized
pursuant hereto, for the purpose of forming a corporation under "The Business
Corporation Act" of the State of Illinois, do hereby adopt the following
Articles of Incorporation:
ARTICLE ONE
The name of the corporation hereby incorporated is: Allied Van Lines Insurance
Agency, Inc.
ARTICLE TWO
The address of its initial registered office in the State of Illinois is: 2120
South 25th Avenue, in the Village of Broadview (60153) County of Cook and the
(Zip Code)
name of its initial Registered Agent at said address is: James W. Tallant
ARTICLE THREE
The duration of the corporation is: perpetual
<PAGE>
ARTICLE FOUR
The purpose or purposes for which the corporation is organized are:
See Schedule Attached.
ARTICLE FIVE
PARAGRAPH 1: The aggregate number of shares which the corporation is authorized
to issue is 100,000 divided into one (1) classes. The designation of each class,
the number of shares of each class, and the par value, if any, of the shares of
each class, or a statement that the shares of any class are without par value,
are as follows:
Class Series Number of Par value per share or statement
(If Any) Shares that shares are without par value
Common None 100,000 $10.00 par value per share
PARAGRAPH 2: The preferences, qualifications, limitations, restrictions and the
special or relative rights in respect of the shares of each class are: None
<PAGE>
ARTICLE SIX
The class and number of shares which the corporation proposes to issue
without further report to the Secretary of State, and the consideration
(expressed in dollars) to be received by the corporation therefor, are:
Total consideration to be
Class of shares Number of Shares received therefor:
Common 100 $1,000.00
$
ARTICLE SEVEN
The corporation will not commence business until at least one thousand
dollars has been received as consideration for the issuance of shares.
ARTICLE EIGHT
The number of directors to be elected at the first meeting of the
shareholders is: 4
ARTICLE NINE
PARAGRAPH 1: It is estimated that the value of all property to be owned by the
corporation for the following year wherever located will be $________
PARAGRAPH 2: It is estimated that the value of the property to be located within
the State of Illinois during the following year will be $________
PARAGRAPH 3: It is estimated that the gross amount of business which will be
transacted by the corporation during the following year will be $________
PARAGRAPH 4: It is estimated that the gross amount of business which will be
transacted at or from places of business in the State of Illinois during the
following year will be $________
NOTE: If all the property of the corporation is to be located in this
State and all of its business is to be transacted at or from places of
business in this State, or if the incorporators elect to pay the initial
franchise tax on the basis of its entire stated capital and paid-in surplus,
then the information called for in Article Nine need not be stated.
<PAGE>
/s/ James W. Tallant
-------------------------------------
-------------------------------------
Incorporators
-------------------------------------
-------------------------------------
NOTE: There may be one or more incorporators. Each incorporator shall be
either a corporation, domestic or foreign, or a natural person of the age of
twenty-one years or more. If a corporation acts as incorporator, the name of the
corporation and state of incorporation shall be shown and the execution must be
by its President or Vice-President and verified by him, and the corporate seal
shall be affixed and attested by its Secretary or an Assistant Secretary.
OATH AND ACKNOWLEDGMENT
STATE OF ILLINOIS }
} ss.
COUNTY OF COOK }
I, Lenore M. Tipping, A Notary Public, do hereby certify that on the 30th day of
July, 1973 James W. Tallant personally appeared before me and being first duly
sworn by me acknowledged the signing of the foregoing document in the respective
capacities therein set forth and declared that the statements therein contained
are true.
IN WITNESS WHEREOF, I have hereunto set my hand and seal the day and year
above written.
/s/ Lenore M. Tipping
-----------------------------------
Notary Public
[NOTARIAL SEAL OF
LENORE M. TIPPING]
FORM B C A-47
================================================================================
ARTICLES OF INCORPORATION
================================================================================
The following fees are required to be paid at the time of issuing certificate of
incorporation: Filing fee, $20.00; Initial license fee of 50 cents per $1,000.00
or 1/20 of 1% of the amount of stated capital and paid-in surplus the
corporation proposes to issue without further report (Article Six); Franchise
tax of 1/20 of 1% of the issued, as above noted. However, the minimum annual
franchise tax is $10.00 and varies monthly on $20,000 or less, as follows:
January, $15; February, $14.17; March, $13.34; April, $12.50; May, $11.67; June,
$10.84; July $10.00; Aug., $9.17; Sept., $8.34; Oct., $7.50; Nov., $6.67; Dec.,
$5.84; (See Sec. 133, BCA).
In excess of $20,000 the franchise tax per $1,000.00 is as follows: Jan., $0.75;
Feb., .7084; March, .6667; April, .625; May, .5834; June, .5417; July, .50;
Aug., .4584; Sept., .4167; Oct., .375; Nov., .3334; Dec., .2917. All shares
issued in excess of the amount mentioned in Article Six of this application must
be reported within 60 days from date of issuance thereof, and franchise tax and
license fee paid thereon; otherwise, the corporation is subject to a penalty of
1% for each month on the amount until reported and subject to a fine of not to
exceed $500.00.
The same fees are required for a subsequent issue of shares except the filing
fee is $1.00 instead of $20.00.
FILED
AUG - 9 1973
/s/ Michael J. Howlett
Secretary of State
================================================================================
(Rev. 1--Req. 4--50M--5-66) 28458
<PAGE>
ALLIED VAN LINES INSURANCE AGENCY, INC.
ARTICLES OF INCORPORATION
ARTICLE FOUR
A. The general purpose of this corporation is to act as agent or broker
for insurance companies in soliciting and receiving applications on all kinds of
insurance and/or cause bonding companies to issue all kinds of bonds. The nature
of the business to be transacted and carried on and the objects and purposes to
be promoted are to do any and all of the things herein mentioned, but only in
conformity with and in the furtherance of the foregoing general purpose, namely:
1. To act as agent or broker for the insurance companies in
soliciting and receiving applications for fire and allied lines, marine,
casualty, accident and health, annuities, life, and all other kinds of
insurance, to cause bonding companies to issue all kinds of bonds, to
collect premiums, to do such other business as may be delegated to agents
or brokers by such companies and to conduct a general insurance agency and
insurance brokerage business.
2. To manufacture, purchase, acquire, sell, transfer and dispose of
goods, wares, merchandise, commodities, supplies, and personal property of
every kind to the extent necessary, proper or incidental to the exercise
of any other powers herein specified.
3. To acquire the good-will, rights, property, franchises and
business and to assume the liabilities of any person, firm, association or
corporation in connection therewith; to hold or in any lawful manner
dispose of the whole or any part of the property so acquired, to conduct
in any lawful manner the whole or any part of the business so acquired and
to exercise all the powers necessary or convenient in and about the
conduct and management of such business.
4. To purchase, hold, sell, assign, transfer, mortgage, pledge or
otherwise dispose of shares of the capital stock of, or any bonds,
securities, or evidence of indebtedness created by any other corporation
or corporations organized under the laws of this state or any other state,
country, nation or government, and while the owner thereof, to exercise
all the rights, powers and privileges of ownership.
5. To issue bonds, debentures or obligations of this corporation
from time to time and to secure the same by mortgage, pledge, deed of
trust or otherwise.
<PAGE>
Allied Van Lines Insurance Agency, Inc.
Articles of Incorporation
Article Four
Page 2
6. To lend and advance money, to give credit to such persons, firms,
corporations and associations as may be deemed advisable and upon such
terms and security as may seem expedient, and in particular to customers
and others having dealings with the company, and to become security for
any such persons, firms, associations and corporations.
7. To enter into, make, perform and carry out contracts of every
kind for any lawful purpose, without limit as to amount, with any person,
firm, association or corporation.
8. To purchase, hold, sell and transfer the shares of its own
capital stock; provided it shall not use its funds or property for the
purchase of its own shares of capital stock when such use would cause any
impairment of its capital; and provided further that shares of its own
capital stock belonging to it shall not be voted upon directly or
indirectly.
9. To have one or more offices, to carry on all or any of its
operations and business and without restriction or limit as to amount to
purchase, or otherwise acquire, hold, own, mortgage, sell, convey or
otherwise dispose of real and personal property of every class and
description in any of the States, Districts, Territories or Colonies of
the United States, and in any and all foreign countries, subject to the
laws of such State, District, Territory, Colony or Country.
10. In general, to carry on any other business in connection with
the foregoing, whether manufacturing or otherwise, and to have and
exercise all the powers conferred by the laws of Illinois upon
corporations formed under the Business Corporation Act of 1933.
B. The foregoing clauses are to be contrued both as objects and powers;
and it is hereby expressly provided that the enumeration herein of specific
objects and powers shall not be held to limit or restrict in any manner the
general powers of the corporation; provided, however, that nothing herein
contained shall be deemed to authorize or permit the corporation to carry on any
business or to exercise any power or to do any act which a corporation formed
under the above-mentioned Act, or any amendment thereof or supplement thereto or
substitute therefor, may not at the time lawfully carry on or do.
<PAGE>
Exhibit 3.32
BY-LAWS
OF
ALLIED VAN LINES INSURANCE AGENCY, INC.
ARTICLE I
Offices
The corporation shall continuously maintain in the State of Illinois a
registered office and a registered agent whose office is identical with such
registered office, and may have other offices within or without the state.
ARTICLE II
SHAREHOLDERS
SECTION 1. ANNUAL MEETING. An annual meeting of the shareholders
shall be held on a day in the month of October of each year for the purpose of
electing directors and for the transaction of such other business as may come
before the meeting. If the day fixed for the annual meeting shall be a legal
holiday, such meeting shall be held on the next succeeding business day.
SECTION 2. SPECIAL MEETINGS. Special meetings of the shareholders
may be called either by the president, by the board of directors or by the
holders of not less than one-fifth of all the outstanding shares of the
corporation, for the purpose or purposes stated in the call of the meeting.
SECTION 3. PLACE OF MEETING. The board of directors may designate
any place, as the place of meeting for any annual meeting or for any special
meeting called by the board of directors. If no designation is made, or if a
special meeting be otherwise called, the place of meeting shall be at The Drake
Hotel, Chicago, Illinois.
<PAGE>
SECTION 4. NOTICE OF MEETINGS. Written notice stating the place,
date, and hour of the meeting, and in the case of a special meeting, the purpose
or purposes for which the meeting is called, shall be delivered not less than
ten nor more than forty days before the date of the meeting, or in the case of a
merger or consolidation not less than twenty nor more than forty days before the
meeting, either personally or by mail, by or at the direction of the president,
or the secretary, or the officer or persons calling the meeting, to each
shareholder of record entitled to vote at such meeting. If mailed, such notice
shall be deemed to be delivered when deposited in the United States mail,
addressed to the shareholder at his address as it appears on the records of the
corporation, with postage thereon prepaid. When a meeting is adjourned to
another time or place, notice need not be given of the adjourned meeting if the
time and place thereof are announced at the meeting at which the adjournment is
taken.
SECTION 5. FIXING OF RECORD DATE. For the purpose of determining the
shareholders entitled to notice of or to vote at any meeting of shareholders or
any adjournment thereof, or to express consent to corporate action in writing
without a meeting, or to receive payment of any dividend, or other distribution
or allotment of any rights, or to exercise any rights in respect of any change,
conversion or exchange of shares or for the purpose of any other lawful action,
the board of directors of the corporation may fix in advance a record date which
shall not be more than forty days and, for a meeting of shareholders, not less
than ten days, or in the case of a merger or consolidation not less than twenty
days, before the date of such meeting. If no record date is fixed, the record
date for the determination of shareholders entitled to notice of or to vote at a
meeting of shareholders, the date on which notice of the meeting is mailed shall
be the record date for such determination of shareholders, and the record date
for the determination of shareholders for any other purpose shall be the date on
which the board of directors adopts the resolution relating thereto. A
determination of shareholders of record entitled to notice of or to vote at a
meeting of shareholders shall apply to any adjournment of the meeting.
SECTION 6. VOTING LISTS. The officer or agent having charge of the
transfer books for shares of the corporation shall make, at least ten days
before each meeting of shareholders, a complete list of the shareholders
entitled to vote at such meeting, arranged in alphabetical order, showing the
address of and the number of shares registered in the name of the shareholder,
which list, for a period of ten days prior to such meeting, shall be kept on
file at the registered office of the corporation and shall be open to inspection
by any shareholder for any purpose germane to the meeting, at any time during
usual business hours. Such list shall also be produced and kept open at the time
and place of the meeting and may be inspected by any shareholder during the
whole time of the meeting. The original share ledger or transfer book, or a
duplicate thereof kept in this State, shall be prima facie evidence as to who
are the shareholders entitled to examine such list or share ledger or transfer
book or to vote at any meeting of shareholders.
<PAGE>
SECTION 7. QUORUM. The holders of a majority of the outstanding
shares of the corporation, present in person or represented by proxy, shall
constitute a quorum at any meeting of shareholders; provided that if less than a
majority of the outstanding shares are represented at said meeting, a majority
of the shares so represented may adjourn the meeting at any time without further
notice. If a quorum is present, the affirmative vote of the majority of the
shares represented at the meeting shall be the act of the shareholders, unless
the vote of a greater number or voting by classes is required by The Business
Corporation Act, the articles of incorporation or these by-laws. At any
adjourned meeting at which a quorum shall be present, any business may be
transacted which might have been transacted at the original meeting. Withdrawal
of shareholders from any meeting shall not cause failure of a duly constituted
quorum at that meeting.
SECTION 8. PROXIES. Each shareholder entitled to vote at a meeting
of shareholders or to express consent or dissent to corporate action in writing
without a meeting may authorize another person or persons to act for him by
proxy, but no such proxy shall be valid after eleven months from the date of its
execution, unless otherwise provided in the proxy.
SECTION 9. VOTING OF SHARES. Each outstanding share, regardless of
class, shall be entitled to one vote upon each matter submitted to vote at a
meeting of shareholders.
SECTION 10. VOTING OF SHARES BY CERTAIN HOLDERS. Shares standing in
the name of another corporation, domestic or foreign, may be voted by such
officer, agent, or proxy as the by-laws of such corporation may prescribe, or,
in the absence of such provision, as the board of directors of such corporation
may determine.
Shares standing in the name of a deceased person, a minor ward or an
incompetent person, may be voted by his administrator, executor, court appointed
guardian, or conservator, either in person or by proxy without a transfer of
such shares into the name of such administrator, executor, court appointed
guardian, or conservator. Shares standing in the name of a trustee may be voted
by him, either in person or by proxy.
Shares standing in the name of a receiver may be voted by such
receiver, and shares held by or under the control of a receiver may be voted by
such receiver without the transfer thereof into his name if authority so to do
be contained in an appropriate order of the court by which such receiver was
appointed.
A shareholder whose shares are pledged shall be entitled to vote
such shares until the shares have been transferred into the name of the pledgee,
and thereafter the pledgee shall be entitled to vote the shares so transferred.
Any number of shareholders may create a voting trust for the purpose
of conferring upon a trustee or trustees the right to vote or otherwise
represent their share, for a period not to exceed ten years, by entering
<PAGE>
into a written voting trust agreement specifying the terms and conditions of the
voting trust, and by transferring their shares to such trustee or trustees for
the purpose of the agreement. Any such trust agreement shall not become
effective until a counterpart of the agreement is deposited with the corporation
at its registered office. The counterpart of the voting trust agreement so
deposited with the corporation shall be subject to the same right of examination
by a shareholder of the corporation, in person or by agent or attorney, as are
the books and records of the corporation, and shall be subject to examination by
any holder of a beneficial interest in the voting trust, either in person or by
agent or attorney, at any reasonable time for any proper purpose.
Shares of its own stock belonging to this corporation shall not be
voted, directly or indirectly, at any meeting and shall not be counted in
determining the total number of outstanding shares at any given time, but shares
of its own stock held by it in a fiduciary capacity may be voted and shall be
counted in determining the total number of outstanding shares at any given time.
SECTION 11. CUMULATIVE VOTING. In all elections for directors, every
shareholder shall have the right to vote, in person or by proxy, the number of
shares owned by him, for as many persons as there are directors to be elected,
or to cumulate said shares, and give one candidate as many votes as the number
of directors multiplied by the number of his shares shall equal, or to
distribute them on the same principle among as many candidates as he shall see
fit.
SECTION 12. INSPECTORS. At any meeting of shareholders, the
presiding officer may, or upon the request of any shareholder shall appoint one
or more persons as inspectors for such meeting.
Such inspectors shall ascertain and report the number of shares
represented at the meeting, based upon their determination of the validity and
effect of proxies; count all votes and report the results; and do such other
acts as are proper to conduct the election and voting with impartiality and
fairness to all the shareholders.
Each report of an inspector shall be in writing and signed by him or
by a majority of them if there be more than one inspector acting at such
meeting. If there is more than one inspector, the report of a majority shall be
the report of the inspectors. The report of the inspector or inspectors on the
number of shares represented at the meeting and the results of the voting shall
be prima facie evidence thereof.
SECTION 13. INFORMAL ACTION BY SHAREHOLDERS. Any action required to
be taken at a meeting of the shareholders, or any other action which may be
taken at a meeting of the shareholders, may be taken without a meeting if a
consent in writing, setting forth the action so taken, shall be signed by all of
the shareholders entitled to vote with respect to the subject matter thereof.
<PAGE>
SECTION 14. VOTING BY BALLOT. Voting on any question or in any
election may be by voice unless the presiding officer shall order or any
shareholder shall demand that voting be by ballot.
ARTICLE III
DIRECTORS
SECTION 1. GENERAL POWERS. The business of the corporation shall be
managed by its board of directors.
SECTION 2. NUMBER, TENURE AND QUALIFICATIONS. The number of
directors of the corporation shall be four (4). Each director shall hold office
until the next annual meeting of shareholders or until his successor shall have
been elected and qualified. Directors need not be residents of Illinois or
shareholders of the corporation. The number of directors may be increased or
decreased from time to time by the amendment of this section; but no decrease
shall have the effect of shortening the term of any incumbent director.
SECTION 3. REGULAR MEETINGS. A regular meeting of the board of
directors shall be held without other notice than this by-law, immediately after
the annual meeting of shareholders. The board of directors may provide, by
resolution, the time and place for the holding of additional regular meetings
without other notice than such resolution.
SECTION 4. SPECIAL MEETINGS. Special meetings of the board of
directors may be called by or at the request of the president or any two
directors. The person or persons authorized to call special meetings of the
board of directors may fix any place as the place for holding any special
meeting of the board of directors called by them.
SECTION 5. NOTICE. Notice of any special meeting shall be given at
least 20 days previous thereto by written notice to each director at his
business address. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail so addressed, with postage thereon prepaid.
If notice be given by telegram, such notice shall be deemed to be delivered when
the telegram is delivered to the telegram company. The attendance of a director
at any meeting shall constitute a waiver of notice of such meeting, except where
a director attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the board of directors need be specified in the
notice or waiver of notice of such meeting.
SECTION 6. QUORUM. A majority of the number of directors fixed by
these by-laws shall constitute a quorum for transaction of business at any
meeting of the board of directors, provided that if less than a majority of such
number of directors are present at said meeting, a majority of the directors
present may adjourn the meeting at any time without further notice.
<PAGE>
SECTION 7. MANNER OF ACTING. The act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the board of directors, unless the act of a greater number is required by
statute, these by-laws, or the articles of incorporation.
SECTION 8. VACANCIES. Any vacancy occurring in the board of
directors and any directorship to be filled by reason of an increase in the
number of directors, may be filled by election at an annual meeting or at a
special meeting of shareholders called for that purpose.
SECTION 9. ACTION WITHOUT A MEETING. Unless specifically prohibited
by the articles of incorporation or by-laws, any action required to be taken at
a meeting of the board of directors, or any other action which may be taken at a
meeting of the board of directors, or of any committee thereof may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all the directors entitled to vote with respect to the
subject matter thereof, or by all the members of such committee, as the case may
be. Any such consent signed by all the directors or all the members of the
committee shall have the same effect as a unanimous vote, and may be stated as
such in any document filed with the Secretary of State or with anyone else.
Section 10. COMPENSATION. The board of directors, by the affirmative
vote of a majority of directors then in office, and irrespective of any personal
interest of any of its members, shall have authority to establish reasonable
compensation of all directors for services to the corporation as directors,
officers, or otherwise. By resolution of the board of directors the directors
may be paid their expenses, if any, of attendance at each meeting of the board.
No such payment previously mentioned in this section shall preclude any director
from serving the corporation in any other capacity and receiving compensation
therefor.
SECTION 11. PRESUMPTION OF ASSENT. A director of the corporation who
is present at a meeting of the board of directors at which action on any
corporate matter is taken shall be conclusively presumed to have assented to the
action taken unless his dissent shall be entered in the minutes of the meeting
or unless he shall file his written dissent to such action with the person
acting as the secretary of the meeting before the adjournment thereof or shall
forward such dissent by registered mail to the secretary of the corporation
immediately after the adjournment of the meeting. Such right to dissent shall
not apply to a director who voted in favor of such action.
SECTION 12. EXECUTIVE COMMITTEE. The board of directors, by
resolution adopted by a majority of the number of directors fixed by the by-laws
or otherwise, may designate two or more directors to constitute an executive
committee, which committee, to the extent provided in such resolution, shall
have and exercise all of the authority of the board of directors in the
management of the corporation, except as otherwise required by law. Vacancies in
the membership of the committee shall be filled by the board of directors at a
regular or special meeting of the board of directors. The executive committee
shall keep regular minutes of its proceedings and report the same to the board
when required.
<PAGE>
ARTICLE IV
OFFICERS
SECTION 1. NUMBER. The officers of the corporation shall be a
president, one or more vice-presidents (the number thereof to be determined by
the board of directors), a treasurer, a secretary, and such assistant
treasurers, assistant secretaries or other officers as may be elected by the
board of directors. Any two or more offices may be held by the same person,
except the offices of president and secretary.
SECTION 2. ELECTION AND TERM OF OFFICE. The officers of the
corporation shall be elected annually by the board of directors at the first
meeting of the board of directors held after each annual meeting of
shareholders. If the election of officers shall not be held at such meeting,
such election shall be held as soon thereafter as conveniently may be. Vacancies
may be filled or new offices created and filled at any meeting of the board of
directors. Each officer shall hold office until his successor shall have been
duly elected and shall have qualified or until his death or until he shall
resign or shall have been removed in the manner hereinafter provided. Election
of an officer shall not of itself create contract rights.
SECTION 3. REMOVAL. Any officer elected or appointed by the board of
directors may be removed by the board of directors whenever in its judgment the
best interests of the corporation would be served thereby, but such removal
shall be without prejudice to the contract rights, if any, of the person so
removed.
SECTION 4. PRESIDENT. The president shall be the principal executive
officer of the corporation. Subject to the direction and control of the board of
directors, he shall be in charge of the business of the corporation; he shall
see that the resolutions and directions of the board of directors are carried
into effect except in those instances in which that responsibility is
specifically assigned to some other person by the board of directors; and, in
general, he shall discharge all duties incident to the office of president and
such other duties as may be prescribed by the board of directors from time to
time. He shall preside at all meetings of the shareholders and of the board of
directors. Except in those instances in which the authority to execute is
expressly delegated to another officer or agent of the corporation or a
different mode of execution is expressly prescribed by the board of directors or
these by-laws, he may execute for the corporation certificates for its shares,
and any contracts, deeds, mortgages, bonds, or other instruments which the board
of directors has authorized to be executed, and he may accomplish such execution
either under or without the seal of the corporation and either individually or
with the secretary, any assistant secretary, or any other officer thereunto
authorized by the board of directors, according to the requirements of the form
of the instrument. He may vote all securities which the corporation is entitled
to vote except as and to the extent such authority shall be vested in a
different officer or agent of the corporation by the board of directors.
<PAGE>
SECTION 5. THE VICE-PRESIDENTS. The vice-president (or in the event
there be more than one vice-president, each of the vice-presidents) shall assist
the president in the discharge of his duties as the president may direct and
shall perform such other duties as from time to time may be assigned to him by
the president or by the board of directors. In the absence of the president or
in the event of his inability or refusal to act, the vice-president (or in the
event there be more than one vice-president, the vice-presidents in the order
designated by the board of directors, or by the president if the board of
directors has not made such a designation, or in the absence of any designation,
then in the order of seniority of tenure as vice-president) shall perform the
duties of the president, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the president. Except in those instances in
which the authority to execute is expressly delegated to another officer or
agent of the corporation or a different mode of execution is expressly
prescribed by the board of directors or these by-laws, the vice-president (or
each of them if there are more than one) may execute for the corporation
certificates for its shares and any contracts, deeds, mortgages, bonds or other
instruments which the board of directors has authorized to be executed, and he
may accomplish such execution either under or without the seal of the
corporation and either individually or with the secretary, any assistant
secretary, or any other officer thereunto authorized by the board of directors,
according to the requirements of the form of the instrument.
SECTION 6. THE TREASURER. The treasurer shall be the principal
accounting and financial officer of the corporation. He shall: (a) have charge
of and be responsible for the maintenance of adequate books of account for the
corporation; (b) have charge and custody of all funds and securities of the
corporation, and be responsible therefor and for the receipt and disbursement
thereof; and (c) perform all the duties incident to the office of treasurer and
such other duties as from time to time may be assigned to him by the president
or by the board of directors. If required by the board of directors, the
treasurer shall give a bond for the faithful discharge of his duties in such sum
and with such surety or sureties as the board of directors may determine.
SECTION 7. THE SECRETARY. The secretary shall: (a) record the
minutes of the shareholders' and of the board of directors' meetings in one or
more books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these by-laws or as required by law; (c) be
custodian of the corporate records and of the seal of the corporation; (d) keep
a register of the post-office address of each shareholder which shall be
furnished to the secretary by such shareholder; (e) sign with the president, or
a vice-president, or any other officer thereunto authorized by the board of
directors, certificates for shares of the corporation, the issue of which shall
have been authorized by the board of directors, and any contracts, deeds,
mortgages, bonds, or other instruments which the board of directors has
authorized to be executed, according to the requirements of the form of the
instrument, except when a different mode of execution is expressly prescribed by
the board of directors or these by-laws; (f) have general charge of the stock
transfer books of the corporation; (g) perform all duties incident to the office
of secretary and such other duties as from time to time may be assigned to him
by the president or by the board of directors.
<PAGE>
SECTION 8. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES. The
assistant treasurers and assistant secretaries shall perform such duties as
shall be assigned to them by the treasurer or the secretary, respectively, or by
the president or the board of directors. The assistant secretaries may sign with
the president, or a vice-president, or any other officer thereunto authorized by
the board of directors, certificates for shares of the corporation, the issue of
which shall have been authorized by the board of directors, and any contracts,
deeds, mortgages, bonds, or other instruments which the board of directors has
authorized to be executed, according to the requirements of the form of the
instrument, except when a different mode of execution is expressly prescribed by
the board of directors or these by-laws. The assistant treasurers shall
respectively, if required by the board of directors, give bonds for the faithful
discharge of their duties in such sums and with such sureties as the board of
directors shall determine.
SECTION 9. SALARIES. The salaries of the officers shall be fixed
from time to time by the board of directors and no officer shall be prevented
from receiving such salary by reason of the fact that he is also a director of
the corporation.
ARTICLE V
CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. CONTRACTS. The board of directors may authorize any
officer or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the name of and on behalf of the corporation, and such
authority may be general or confined to specific instances.
SECTION 2. LOANS. No loans shall be contracted on behalf of the
corporation and no evidences of indebtedness shall be issued in its name unless
authorized by a resolution of the board of directors. Such authority may be
general or confined to specific instances.
SECTION 3. CHECKS, DRAFTS, ETC. All checks, drafts or other orders
for the payment of money, notes or other evidences of indebtedness issued in the
name of the corporation, shall be signed by such officer or officers, agent or
agents of the corporation and in such manner as shall from time to time be
determined by resolution of the board of directors.
SECTION 4. DEPOSITS. All funds of the corporation not otherwise
employed shall be deposited from time to time to the credit of the corporation
in such banks, trust companies or other depositaries as the board of directors
may select.
<PAGE>
ARTICLE VI
CERTIFICATES FOR SHARES AND
THEIR TRANSFER
SECTION 1. CERTIFICATES FOR SHARES. Certificates representing shares
of the corporation shall be signed by the president or a vice-president or by
such officer as shall be designated by resolution of the board of directors and
by the secretary or an assistant secretary, and shall be sealed with the seal or
a facsimile of the seal of the corporation. If both of the signatures of the
officers be by facsimile, the certificate shall be manually signed by or on
behalf of a duly authorized transfer agent or clerk. Each certificate
representing shares shall be consecutively numbered or otherwise identified, and
shall also state the name of the person to whom issued, the number and class of
shares (with designation of series, if any), the date of issue, that the
corporation is organized under Illinois law, and the par value or a statement
that the shares are without par value. If the corporation is authorized and does
issue shares of more than one class or of series within a class, the certificate
shall also contain such information or statement as may be required by law.
The name and address of each shareholder, the number and class of
shares held and the date on which the certificates for the shares were issued
shall be entered on the books of the corporation. The person in whose name
shares stand on the books of the corporation shall be deemed the owner thereof
for all purposes as regards the corporation.
SECTION 2. LOST CERTIFICATES. If a certificate representing shares
has allegedly been lost or destroyed the board of directors may in its
discretion, except as may be required by law, direct that a new certificate be
issued upon such indemnification and other reasonable requirements as it may
impose.
SECTION 3. TRANSFERS OF SHARES. Transfers of shares of the
corporation shall be recorded on the books of the corporation and, except in the
case of a lost or destroyed certificate, on surrender for cancellation of the
certificate for such shares. A certificate presented for transfer must be duly
endorsed and accompanied by proper guaranty of signature and other appropriate
assurances that the endorsement is effective.
ARTICLE VII
FISCAL YEAR
The fiscal year of the corporation shall be fixed by resolution of
the board of directors.
<PAGE>
ARTICLE VIII
DIVIDENDS
The board of directors may from time to time declare, and the
corporation may pay, dividends on its outstanding shares in the manner and upon
the terms and conditions provided by law and its articles of incorporation.
ARTICLE IX
SEAL
The corporate seal shall have inscribed thereon the name of the
corporation and the words "Corporate Seal, Illinois". The seal may be used by
causing it or a facsimile thereof to be impressed or affixed or in any manner
reproduced.
ARTICLE X
WAIVER OF NOTICE
Whenever any notice is required to be given under the provisions of
these by-laws or under the provisions of the articles of incorporation or under
the provisions of The Business Corporation Act of the State of Illinois, a
waiver thereof in writing, signed by the person or persons entitled to such
notice, whether before or after the time stated therein, shall be deemed
equivalent to the giving of such notice.
ARTICLE XI
AMENDMENTS
The power to make, alter, amend, or repeal the by-laws of the
corporation shall be vested in the board of directors, unless reserved to the
shareholders by the articles of incorporation. The by-laws may contain any
provisions for the regulation and management of the affairs of the corporation
not inconsistent with law or the articles of incorporation.
<PAGE>
INDEMNIFICATION OF OFFICERS,
DIRECTORS, EMPLOYEES AND AGENTS
SECTION 1. The corporation shall have power to indemnify any person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
corporation) by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment or settlement conviction or upon a plea
of nolo contendere or its equivalent, shall not, of itself, create a presumption
that the person did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interest of the corporation, and
with respect to any criminal action or proceeding, had reasonable cause to
believe that his conduct was unlawful.
SECTION 2. The corporation shall have power to indemnify any person
who was or is a party or is threatened, pending or completed action or suit by
or in the right of the corporation to procure a judgment in its favor by reason
of the fact that he is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable for negligence or misconduct in the performance of his duty to the
corporation unless and only to the extent that the court in which such action or
suit was brought shall determine upon application that despite the adjudication
of liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the court
shall deem proper.
<PAGE>
SECTION 3. To the extent that a director, officer, employee or agent
of a corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in sections 1 and 2, or in defense of
any claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
SECTION 4. Any indemnification under sections 1 and 2 (unless
ordered by a court) shall be made by the corporation only as authorized in the
specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in sections 1 and 2. Such determination
shall be made (a) by the board of directors by a majority vote of a quorum
consisting of directors who were not parties to such action, suit or proceeding,
or (b) if such a quorum is not obtainable, or, even if obtainable a quorum of
disinterested directors so directs, by independent legal counsel in a written
opinion, or (c) by the shareholders.
SECTION 5. The indemnification provided by this article shall not be
deemed exclusive of any other rights to which those indemnified may be entitled
under any contract, agreement, vote of shareholders or disinterested directors
or otherwide, both as to action in his official capacity and as to action in
another capacity while holding such office, and shall continue as to a person
who has ceased to be a director, officer, employee or agent and shall inure to
the benefit of the heirs, executors and administrators of such a person.
SECTION 6. The corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
him and incurred by him in any such capacity, or arising out of his status as
such, whether or not the corporation would have the power to indemnify him
against such liability under the provisions of this article.
<PAGE>
Exhibit 3.33
REC R-87 PAGE 538
State of Delaware
[STATE CREST]
Office of Secretary of State.
I, Elisha C. Dukes, Secretary of State of the State of Delaware, do hereby
certify that the above and foregoing is a true and correct copy of Certificate
of Amendment of the "ALLIED VAN LINES TERMINAL COMPANY", as received and filed
in this office the seventh day of March, A.D. 1966, at 9 o'clock A.M.
In Testimony Whereof, I have hereunto set my hand and official seal at
Dover this seventh day of March in the year of our Lord one thousand nine
hundred and sixty-six.
[STATE SEAL] /s/ Elisha C. Dukes
----------------------------------
Secretary of State
/s/ [ILLEGIBLE]
----------------------------------
Ass't Secretary of State
FORM 12O REC'D FOR RECORD Mar 14th 1966 LEO J. DUGAN, Jr. RECORDER
<PAGE>
ALLIED VAN LINES TERMINAL COMPANY
CERTIFICATE OF AMENDMENT
STATE OF ILLINOIS )
) ss.
COUNTY OF COOK )
We, Ralph Rolapp, President, and John F. Christie, Jr., Secretary, of the
Allied Van Lines Terminal Company, a corporation organized and existing under
and by virtue of the laws of Delaware, do hereby certify as follows:
1. On November 21, 1950, there was issued by the Secretary of State of
Delaware a certificate of incorporation constituting and creating Allied
Van Lines Terminal Company a corporation under the laws of the State of
Delaware with its principal place of business in the City of Wilmington,
County of New Castle, State of Delaware.
2. The aforesaid certificate of incorporation, dated November 21, 1950, as
amended, authorized a capital stock of one hundred one thousand (101,000)
shares of which stock one hundred thousand (100,000) shares of the par
value of Ten Dollars ($10.00) each, amounting in the aggregate to One
Million Dollars ($1,000,000.00), was Class A stock, and of which one
thousand (1,000) shares of the par value of Five Dollars ($5.00) each,
amounting in the aggregate to Five Thousand Dollars ($5,000.00) was common
stock.
3. On the 2nd day of February, 1966, the Board of Directors of this
corporation, with the unanimous consent of its shareholders, adopted a
resolution proposing and authorizing an amendment to the aforesaid
certificate of incorporation, to-wit:
"FOURTH A. The total number of shares of stock which the corporation
shall have the authority to issue is three hundred thousand
(300,000) shares, of which stock one hundred thousand (100,000)
shares of the par value of Ten Dollars ($10.00) each, amounting in
the aggregate of One Million Dollars ($1,000,000.00), shall be Class
A stock, and of which two hundred thousand (200,000) shares of the
par value of Five Dollars ($5.00) each, amounting in the aggregate
to One Million Dollars ($1,000,000.00), shall be common stock."
4. The capital of this corporation will not be reduced under or by
<PAGE>
-2-
reason of the amendment.
5. Said amendment to the certificate of incorporation was duly adopted by
the Board of Directors of this corporation pursuant to and in accordance
with the provisions of Sec. 242 of Title 8 of the Delaware Code.
IN WITNESS WHEREOF, said Ralph Rolapp, President, and said John F.
Christie, Jr., Secretary, of the Allied Van Lines Terminal Company, have signed
this certificate and caused the corporate seal of said company to be affixed
this 23 day of February, 1966.
ALLIED VAN LINES TERMINAL COMPANY
By: /s/ Ralph Rolapp
-------------------------------
Its President
By: /s/ John F. Christie Jr.
-------------------------------
Its Secretary
(SEAL)
STATE OF CALIFORNIA )
) ss
COUNTY OF LOS ANGELES )
Ralph Rolapp, being first duly sworn, on oath deposes and says that he is the
President of Allied Van Lines Terminal Company; that he has signed the foregoing
Certificate of Amendment and that those matters and representations contained in
said Certificate are true.
/s/ Ralph Rolapp
-------------------------------
Ralph Rolapp
SUBSCRIBED AND SWORN TO BEFORE ME
THIS 23rd DAY OF February, 1966.
/s/ Trudi L. Dieterle
- ----------------------------------
Notary Public
TRUDI L. DIETERLE - NOTARY PUBLIC
For the County of Los Angeles, and State of California
My Commission Expires March 18, 1969
221 S. BEVERLY DR., BEVERLY HILLS, CALIF.
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TRUDI L. DIETERLE
[SEAL] NOTARY PUBLIC - CALIFORNIA
PRINCIPAL OFFICE IN
LOS ANGELES COUNTY
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My Commission Expires March 18, 1969
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State of Delaware
[STATE CREST]
Office of Secretary of State.
I, Elisha C. Dukes, Secretary of State of the State of Delaware, do hereby
certify that the above and foregoing corresponds with and includes all of the
provisions of the Certificate of Incorporation of the "ALLIED VAN LINES TERMINAL
COMPANY", as received and filed in this office the twenty-first day of November,
A.D. 1950, at 9 o'clock A.M., as amended and in effect July 27, 1966.
In Testimony Whereof, I have hereunto set my hand and official seal at
Dover this twenty-seventh day of July in the year of our Lord one thousand nine
hundred and sixty-six.
[STATE SEAL] /s/ Elisha C. Dukes
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Secretary of State
/s/ [ILLEGIBLE]
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Ass't Secretary of State
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CERTIFICATE OF INCORPORATION OF
ALLIED VAN LINES TERMINAL COMPANY
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FIRST. The name of the corporation is ALLIED VAN LINES TERMINAL
COMPANY
SECOND. Its principal office in the State of Delaware is located at
No. 100 West Tenth Street, in the City or Wilmington, County or New Castle. The
name and address of its resident agent is The Corporation Trust Company, No. 100
West Tenth Street, Wilmington, Delaware.
THIRD. The nature of the business, or objects or purposes to be
transacted, promoted or carried on are:
(a) To purchase real estate, and to construct and operate buildings
thereon.
(b) To supply, maintain and operate freight terminal facilities
including driveways, loading
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platforms, tractors, warehouse and storage facilities for the receipt,
delivery, storage or handling of freight, including power, light, heat and
machinery.
(c) To conduct the business of a filling and service station, which
business shall include the dealing in gasoline and all other petroleum
products; all kinds of oils and products used for motor fuel or
lubrication; all manner of accessories and appliances to be used on motor
vehicles of every description; the washing, polishing and storing of motor
vehicles.
(d) To purchase, sell, lease, make repairs to, and store automobiles
and trucks, their parts and accessories.
(e) To buy and sell all kinds of automobile parts, machinery,
accessories, oils, paints and greases of every kind, nature and
description, and to engage in the business of distributing, buying,
selling, and repairing of automobile tires.
(f) To own, operate, manage, carry on and conduct dormitories,
restaurants, commissaries, and similar facilities and services of all
kinds;
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to convert, alter, reconstruct, rebuild and improve any of the same
respectively as from time to time may be deemed expedient, and to
manufacture, purchase, produce, or otherwise acquire any and all fuel,
ice, provisions, light, heat, power, materials or articles of any kind for
its own use.
(g) To manufacture, purchase or otherwise acquire, invest in, own,
mortgage, pledge, sell, assign and transfer or otherwise dispose of,
trade, deal in and deal with goods, wares and merchandise and personal
property of every class and description.
(h) To acquire, and pay for in cash, stock or bonds of this
corporation or otherwise, the good will, rights, assets and property, and
to undertake or assume the whole or any part of the obligations or
liabilities of any person, firm, association or corporation.
(i) To acquire, hold, use, sell, assign, lease, grant licenses in
respect of, mortgage or otherwise dispose of letters patent of the United
States or any foreign country, patent rights, licenses and privileges,
inventions, improvements and processes, copy-
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rights, trade-marks and trade names, relating to or useful in connection
with any business of this corporation.
(j) To acquire by purchase, subscription or otherwise, and to
receive, hold, own, guarantee, sell, assign, exchange, transfer, mortgage,
pledge or otherwise dispose of or deal in and with any of the shares of
the capital stock, or any voting trust certificates in respect of the
shares of capital stock, scrip, warrants, rights, bonds, debentures,
notes, trust receipts, and other securities, obligations, choses in action
and evidences of indebtedness or interest issued or created by any
corporations, joint stock companies, syndicates, associations, firms,
trusts or persons, public or private, or by the government of the United
States of America, or by any foreign government, or by any state,
territory, province, municipality or other political subdivision or by any
governmental agency, and as owner thereof to possess and exercise all the
rights, powers and privileges of ownership, including the right to execute
consents and vote thereon, and to do any and all acts and things necessary
or advisable for the
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preservation, protection, improvement and enhancement in value thereof.
(k) To enter into, make and perform contracts of every kind and
description with any person, firm, association, corporation, municipality,
county, state, body politic or government or colony or dependency thereof.
(l) To borrow or raise moneys for any of the purposes of the
corporation and, from time to time, without limit as to amount to draw,
make, accept, endorse, execute and issue promissory notes, drafts, bills
of exchange, warrants, bonds, debentures and other negotiable or
non-negotiable instruments and evidences of indebtedness, and to secure
the payment of any thereof and of the interest thereon by mortgage upon or
pledge, conveyance or assignment in trust of the whole or any part of the
property of the corporation, whether at the time owned or thereafter
acquired, and to sell, pledge or otherwise dispose of such bonds or other
obligations of the corporation for its corporate purposes.
(m) To loan to any person, firm or corpora-
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tion any of its surplus funds, either with or without security.
(n) To purchase, hold, sell and transfer the shares of its own
capital stock; provided it shall not use its funds or property for the
purchase of its own shares of capital stock when such use would cause any
impairment of its capital except as otherwise permitted by law, and
provided further that shares of its own capital stock belonging to it
shall not be voted upon directly or indirectly.
(o) To have one or more offices, to carry on all or any of its
operations and business and without restriction or limit as to amount to
purchase or otherwise acquire, hold, own, mortgage, sell, convey, or
otherwise dispose of real and personal property of every class and
description in any of the States, Districts, Territories or Colonies of
the United States, and in any and all foreign countries, subject to the
laws of such State, District, Territory, Colony or Country.
(p) In general, to carry on any other business in connection with
the foregoing, and to have
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and exercise all the powers conferred by the laws of Delaware upon
corporations formed under the General Corporation Law of the State of
Delaware, and to do any or all the things hereinbefore set forth to the
same extent as natural persons might or could do.
The objects and purposes specified in the foregoing clauses shall,
except where otherwise expressed, be in nowise limited or restricted by
reference to, or inference from, the terms of any other clause in this
certificate of incorporation, but the objects and purposes specified in each of
the foregoing clauses of this article shall be regarded as independent objects
and purposes.
FOURTH. A. The total number of shares of stock which the corporation
shall have the authority to issue is one hundred and one thousand (101,000) of
which stock one hundred thousand (100,000) shares of the par value of Ten
Dollars ($10.00) each, amounting in the aggregate to One Million Dollars
($1,000,000.00) shall be preferred stock and of which one thousand (1,000)
shares of the par value of Five Dollars ($5.00) each, amounting in the aggregate
to Five Thousand Dollars ($5,000.00) shall be common stock.
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If the corporation or its nominee does not elect to purchase the share within
such period, the holder may sell the share to anyone.
(2) The failure of the corporation to purchase a share of stock
pursuant to the option granted in paragraph (a) above does not discharge the
share from any of the conditions contained herein. All the conditions hereby
imposed apply to all shares of stock in the hands of all holders or owners,
whether original shareholders or subsequent purchasers or transferees, whether
acquired through the voluntary or involuntary act of a shareholder or by
operation of law.
FIFTH. The minimum amount of capital with which the corporation will
commence business is One Thousand Dollars ($1,000.00).
SIXTH. The names and places of residence of the incorporators are as
follows:
NAMES RESIDENCES
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C. S. Peabbles Wilmington, Delaware
S. M. Brown Wilmington, Delaware
Wilson Powell Wilmington, Delaware
SEVENTH. The corporation is to have perpetual existence.
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EIGHTH. The private property of the stockholders of the corporation
shall not be subject to the payment of corporate debts to any extent whatever.
NINTH. In furtherance and not in limitation of the powers conferred
by statute, the board of directors is expressly authorized:
(a) To make, alter, amend or repeal the by-laws of the corporation.
(b) To authorize and cause to be executed mortgages and liens upon
the real and personal property of the corporation.
(c) When and as authorized by the affirmative vote of the holders of
a majority of the stock issued and outstanding having voting power given
at a stockholders' meeting duly called for that purpose, or when
authorized by the written consent of the holders of a majority of the
voting stock issued and outstanding, to sell, lease or exchange all of the
property and assets of the corporation, including its good will and its
corporate franchises, upon such terms and conditions and for such
consideration, which may be in whole or in part shares of stock in, and/or
other securities of, any other corporation or corpora-
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tions, as its board of directors shall deem expedient and for the best
interests of the corporation.
(d) To exercise all such powers and do all such acts as may be
exercised or done by the corporation except as otherwise provided by the
statutes of Delaware, this certificate, and the by-laws of the
corporation.
TENTH. Whenever a compromise or arrangement is proposed between this
corporation and its creditors or any class of them and/or between this
corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this corporation or of any creditor or stockholder thereof, or on the
application of any receiver or receivers appointed for this corporation under
the provisions of Section 3883 of the Revised Code of 1915 of said State, or on
the application of trustees in dissolution or of any receiver or receivers
appointed for this corporation under the provisions of Section 43 of the General
Corporation Law of the State of Delaware, order a meeting of the creditors or
class of creditors, and/or of the stockholders or class of stockholders of this
corpora-
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tion, as the case may be, to be summoned in such manner as the said Court
directs. If a majority in number representing three-fourths in value of the
creditors or class of creditors, and/or of the stockholders or class of
stockholders of this corporation, as the case may be, agree to any compromise or
arrangement and to any reorganization of this corporation as consequence of such
compromise or arrangement, the said compromise or arrangement and the said
reorganization shall, if sanctioned by the Court to which the said application
has been made, be binding on all the creditors or class of creditors, and/or on
all the stockholders or class of stockholders, of this corporation as the case
may be, and also on this corporation.
ELEVENTH. Elections of directors need not be by ballot unless the
by-laws of the corporation so provide.
TWELFTH. The corporation reserves the right to amend, alter, change
or repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
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Received for Record
November 21st, A. D. 1950.
Burton S. Heal, Recorder.
STATE OF DELAWARE :
: SS.:
NEW CASTLE COUNTY :
Recorded in the Recorder's Office at Wilmington, in Corporation
Record , Vol. Page &c., the 21st day of November, A. D. 1950.
Witness my hand and official seal.
Burton S. Heal,
Recorder.
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" Recorder of Deeds Office "
" New Castle Co. Del. "
" Mercy - Justice. "
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WE, THE UNDERSIGNED, being each of the incorporators hereinbefore
named for the purpose of forming a corporation in pursuance of the General
Corporation Law of the State of Delaware, do make this certificate, hereby
declaring and certifying that the facts herein stated are true, and accordingly
have hereunto set our hands and seals this 20th day of November, A. D. 1950.
C. S. Peabbles (SEAL)
S. M. Brown (SEAL)
Wilson Powell (SEAL)
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STATE OF DELAWARE )
) ss.:
COUNTY OF NEW CASTLE )
BE IT REMEMBERED, that on this 20th day of November, A. D. 1950,
personally came before me, a Notary Public for the State of Delaware, C. S.
Peabbles, S. M. Brown and Wilson Powell, all of the parties to the foregoing
certificate of incorporation, known to me personally to be such, and severally
acknowledged the said certificate to be the act and deed of the signers
respectively and that the facts therein stated are truly set forth.
GIVEN under my hand and seal of office the day and year aforesaid.
M. Ruth Mannering
Notary Public
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" M. Ruth Mannering "
" Notary Public "
" Appointed Feb. 11, 1949 "
" Delaware "
" Term Two Years "
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STATE OF DELAWARE
OFFICE OF SECRETARY OF STATE
I, HARRIS B. McDOWELL, JR., Secretary of State of the State of
Delaware, DO HEREBY CERTIFY that the above and foregoing is a true and correct
copy of Certificate of Incorporation of the "ALLIED VAN LINES TERMINAL COMPANY",
as received and filed in this office the twenty-first day of November, A. D.
1950, at 9 o'clock A. M.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official
seal, at Dover, this twenty-first day of November in the year of our
Lord one thousand nine hundred and fifty.
HARRIS B. McDOWELL, JR.
Secretary of State.
NELLIE W. NORBET
Ass't. Secretary of State.
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" Secretary's Office "
" "
" 1855 Delaware 1793 "
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Exhibit 3.34
RESTATED BY-LAWS OF
ALLIED VAN LINES TERMINAL COMPANY
AS OF MAY 8, 1976
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ARTICLE 1
OFFICES
1.1 The principal office shall be in the City of Wilmington, County of New
Castle, State of Delaware. The corporation may also have offices at such other
places as the board of directors may from time to time determine or the business
of the corporation may require.
ARTICLE 2
STOCKHOLDERS' MEETINGS
2.1 Annual Meeting. The annual meeting of stockholders entitled to vote
shall be held in the State of Delaware or elsewhere and at such time and place
as may be determined by the board of directors from time to time but not less
than sixty (60) days prior to the date set for such meeting. At the annual
meeting the stockholders shall elect the board of directors by a plurality vote
and transact such other business as may properly be brought before the meeting.
Written notice of the annual meeting shall be served upon or mailed to each
stockholder entitled to vote thereat at such address as appears on the books of
the corporation, at least twenty (20) days prior to the meeting.
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2.2 Special Meetings. Special meetings of the stockholders, for any
purpose or purposes, unless otherwise prescribed by statute or by the
certificate of incorporation, may be called by the president and shall be called
by the president or secretary at the request in writing of a majority of the
board of directors, or at the request in writing of stockholders owning a
majority in amount of the entire capital stock of the corporation issued and
outstanding and entitled to vote. Such request shall state the purpose or
purposes of the proposed meeting. Written notice of a special meeting of
stockholders, stating the time and place and object thereof, shall be served
upon or mailed to each stockholder entitled to vote thereat at such address as
appears on the books of the corporation at least ten (10) days before such
meeting. Business transacted at all special meetings shall be confined to the
objects stated in the call.
2.3 Quorum. The holders of a majority of the stock issued and outstanding
and entitled to vote thereat, present in person or represented by proxy, shall
be requisite and shall constitute a quorum at all meetings of the stockholders
for the transaction of business except as otherwise provided by statute, by the
certificate of incorporation or by these by-laws. If, however, such quorum shall
not be present or represented at any meeting of the stockholders, the
stockholders entitled to vote thereat, present in person or represented by
proxy, shall have power to adjourn the meeting from time to time, without notice
other than announcement at the meeting, until a quorum shall be present or
represented.
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At such adjourned meeting at which a quorum shall be present or represented any
business may be transacted which might have been transacted at the meeting as
originally notified.
2.4 Voting. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before the meeting unless
otherwise provided by statute or the certificate of incorporation of these
by-laws. At any meeting of the stockholders every stockholder having the right
to vote shall be entitled to vote in person or by proxy. Each stockholder shall
have one vote for each share of stock having voting power, registered in his
name on the books of the corporation.
2.5 Corporate Action by Consent. Whenever the vote of stockholders at a
meeting thereof is required or permitted to be taken in connection with any
corporate action, the meeting and vote of stockholders may be dispensed with if
all the stockholders entitled to vote upon the action consent thereto in
writing.
ARTICLE 3
DIRECTORS
3.1 Number, Term, and Eligibility. The directors who shall constitute the
whole board shall be eighteen (18) in number. Directors shall be elected at the
annual meeting of the stockholders and shall each serve for a term of one year
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except as provided in Section 3.2 hereof, and each director shall serve until
his successor shall be elected and qualify. Directors need not be stockholders.
The foregoing provisions notwithstanding, each director elected at the November
1, 1975 annual meeting of stockholders shall hold office for a term of
approximately seven months until the 1976 annual meeting of stockholders and
thereafter until his respective successor shall have been elected and shall have
qualified.
3.2 Vacancies. If any vacancies occur in the board of directors caused by
death, resignation, retirement, disqualification or removal from office of any
directors or otherwise, or any new directorship is created by any increase in
the authorized number of directors, a majority of the directors then in office,
though less than a quorum, may choose a successor or successors, or fill the
newly created directorship and the directors so chosen shall hold office until
the next annual election of directors and until their successors shall be duly
elected and qualified, unless sooner displaced.
3.3 Committees. The board of directors may by resolution passed by a
majority of the whole board designate one or more committees, each committee to
consist of two or more of the directors of the corporation, which, to the extent
provided in the resolution, may exercise the powers of the board of directors in
the management of the business and affairs of the corporation, and may authorize
the seal of the corporation to be affixed to all papers which may require it.
Such committee or committees shall have such name or names as may be determined
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from time to time by resolution adopted by the board of directors.
3.4 Compensation. Directors shall not receive any compensation for their
services.
3.5 Meetings. Immediately after the adjournment of the annual meeting of
the stockholders, the new board of directors shall meet for the purpose of
organization, the election of officers, and the transaction of such other
business as may properly come before the meeting. Regular meetings of the board
may be held without notice at such time and place as shall from time to time be
determined by the board. Special meetings of the board may be called by the
president on seven (7) days' notice to each director, either personally or by
mail or by telegram; special meetings shall be called by the president or
secretary in like manner and on like notice on the written request of a majority
of the directors.
3.6 Quorum. At all meetings of the board a majority of the directors shall
be necessary and sufficient to constitute a quorum for the transaction of
business and the act of a majority of the directors present at any meeting at
which there is a quorum shall be the act of the board of directors, except as
may be otherwise specifically provided by statute or by the certificate of
incorporation or by these by-laws. If a quorum is not present at any meeting of
directors, the directors present thereat may adjourn the meeting from time to
time, without notice other than announcement at the meeting, until a quorum is
present.
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ARTICLE 4
OFFICERS
4.1 Officers. The officers of Allied Van Lines Terminal Company shall be
Chairman of the Board, a Vice Chairman, a President, a Secretary, a Treasurer
and such other officers including Vice Presidents, as are provided for by
majority vote of all members of the Board of Directors, as hereinafter provided.
The Chairman of the Board, the Vice Chairman, the Secretary, and the Treasurer
shall be selected from the Board of Directors at an election by the Board of
Directors to be carried out without nomination and by secret ballot. For each
such office, enough ballots shall be separately voted until one person receives
a majority of the votes cast. The President, who shall not be an agent, nor a
partner, employee or stockholder of an agent, shall be appointed by resolution
of the Board of Directors on recommendation of the Chairman of the Board. The
Vice Presidents and all other officers, none of whom may be an agent, nor a
partner, employee or stockholder of an agent, shall be appointed by resolution
of the Board of Directors, upon recommendation of the President. Except as
otherwise provided by these Bylaws, or by contract in the case of an appointed
officer, the term of every office shall be for one year and until the successor
has been duly chosen and qualified. Election or appointment of an officer shall
not of itself create contract rights. The foregoing provisions notwithstanding,
each officer chosen and qualified at the Board organizational meeting following
the 1975 annual meeting shall hold office for a term of approximately seven
months until the Board
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organizational meeting following the 1976 annual meeting and thereafter until
his respective successor shall have been duly chosen and qualified.
4.2 Compensation. The president, vice president, secretary and treasurer,
of the corporation shall receive no compensation for their services.
4.3 The officers of the corporation shall hold office until their
successors are chosen and qualify in their stead. Any officer elected or
appointed by the board of directors may be removed at any time by the
affirmative vote of a majority of the whole board of directors. If an office
becomes vacant for any reason, the vacancy shall be filled by the board of
directors.
4.3A Chairman of the Board. The Chairman of the Board shall not be elected
to serve more than five (5) consecutive terms, except that election for a sixth
consecutive term may be voted, if approved, by secret ballot, by twelve (12)
members of the Board of Directors, excluding the Chairman. The Chairman of the
Board shall be the principal executive officer of the Corporation, and shall
preside over and conduct all meetings of stockholders and the Board of
Directors. Subject to the Board of Directors, he shall direct the policy of the
Corporation. He shall report to the Board regularly, and to the stockholders at
the annual meeting, on all matters within his knowledge which the interests of
the Corporation may require.
4.3B Vice Chairman. In the absence of the Chairman of the Board, or
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in the event of his death, or inability or refusal to act, the Vice Chairman
shall perform the duties of the Chairman, and when so acting, shall have all the
powers of and be subject to all the restrictions upon the Chairman.
4.4 President. The President shall be the chief administrative officer of
the Corporation. The President shall execute, or duly authorize the execution of
all contracts, deeds, mortgages, bonds and agreements authorized by the Board of
Directors. He shall vote all shares of stock of any other corporation standing
in the name of the Corporation, as directed by the Board of Directors. In
general, he shall perform all duties incident to the office of President, and
such other duties as may be prescribed by the Chairman of the Board.
4.5 Vice President. The vice president shall, in the absence or disability
of the president, perform the duties and exercise the powers of the President,
and shall perform such other duties as the board of directors shall prescribe.
4.6 Secretary. The secretary shall attend all sessions of the board and
all meetings of the stockholders and record all votes and the minutes of all
proceedings in a book to be kept for that purpose and shall perform like duties
for any standing committees when required. He shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the board of
directors, and shall perform such other duties as may be prescribed by the board
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of directors or president, under whose supervision he shall be. He shall keep in
safe custody the seal of the corporation and, when authorized by the board,
affix it to any instrument requiring it and, when so affixed, it shall be
attested by his signature or by the signature of the treasurer or an assistant
secretary.
4.7 Assistant Secretary. The assistant secretary shall, in the absence or
disability of the secretary, perform the duties and exercise the powers of the
secretary and shall perform such other duties as the board of directors shall
prescribe.
4.8 Treasurer. The treasurer shall have the custody of the corporate funds
and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the board of directors. He shall
disburse the funds of the corporation as may be ordered by the board, taking
proper vouchers for such disbursements, and shall render to the president and
directors, at the regular meetings of the board, or whenever they may require
it, an account of all his transactions as treasurer and of the financial
condition of the corporation. If required by the board of directors, he shall
give the corporation a bond (which shall be renewed every six years) in such sum
and with such surety or sureties as shall be satisfactory to the board for the
faithful performance of the duties of his office and for the restoration to the
corporation, in case of his death, resignation,
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retirement or removal from office, of all books, papers, vouchers, money and
other property of whatever kind in his possession or under his control belonging
to the corporation.
4.9 Assistant Treasurer. The assistant treasurer shall, in the absence or
disability of the treasurer, perform the duties and exercise the powers of the
treasurer and shall perform such other duties as the board of directors shall
prescribe.
ARTICLE 5
SHARES OF CAPITAL STOCK
5.1 Certificate. The certificates of stock of the corporation shall be
numbered and shall be entered in the books of the corporation as they are
issued. They shall exhibit the holder's name and number of shares and shall be
signed by the president or a vice president and the treasurer or an assistant
treasurer or the secretary or an assistant secretary. The designations,
preferences and relative, participating, optional or other special rights of
each class of stock or series thereof and the qualifications, limitations or
restrictions of such preferences or rights shall be set forth in full or
summarized on the face or back of the certificates which the corporation shall
issue to represent such class or series of stock.
5.2 Transfers. Upon surrender to the corporation of a certificate for
shares duly endorsed or accompanied by proper evidence of succession, assignment
or authority to transfer, it shall be the duty of the corporation to issue a new
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certificate to the person entitled thereto, cancel the old certificate and
record the transaction upon its books.
5.3 Registered Stockholders. The corporation shall be entitled to treat
the holder of record of any share or shares of stock as the holder in fact
thereof, and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such share or shares on the part of any other
person, whether or not it shall have express or other notice thereof, except as
otherwise provided by the laws of Delaware.
5.4 Lost Certificates. The board of directors may direct a new certificate
or certificates to be issued in place of any certificate or certificates
theretofore issued by the corporation alleged to have been lost or destroyed,
upon the making of an affidavit of that fact by the person claiming the
certificate of stock to be lost or destroyed. When authorizing such issue of a
new certificate or certificates, the board of directors may, in its discretion
and as a condition precedent to the issuance thereof, require the owner of such
lost or destroyed certificate or certificates, or his legal representative, to
give the corporation a bond in such sum as it may direct as indemnity against
any claim that may be made against the corporation with respect to the
certificate alleged to have been lost or destroyed.
5.5 Dividends. Dividends upon the capital stock of the corporation,
subject to the provisions of the certificate of incorporation, if any, may be
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declared by the board of directors at any regular or special meeting, pursuant
to law. Dividends may be paid in cash, in property, or in shares of the capital
stock, subject to the provisions of the certificate of incorporation. Before
payment of any dividend, there may be set aside out of any funds of the
corporation available for dividends such sum or sums as the directors from time
to time, in their absolute discretion, think proper as a reserve fund to meet
contingencies, or for equalizing dividends, or for repairing or maintaining any
property of the corporation, or for such other purpose as the directors shall
think conducive to the interest of the corporation, and the directors may modify
or abolish any such reserve in the manner in which it was created.
ARTICLE 6
NOTICES
6.1 Whenever notice is required to be given to any director or stockholder
under the provisions of the statutes or the certificate of incorporation or
these by-laws, it shall not be construed to mean personal notice but may be
given in writing, by mail, addressed to the director or stockholder at such
address as appears on the books of the corporation, and such notice shall be
deemed to be given at the time when it is thus mailed; and a waiver thereof in
writing signed by the person or persons entitled to the notice, whether before
or after the time stated therein, shall be deemed equivalent thereto.
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ARTICLE 7
FISCAL YEAR
7.1 The fiscal year shall begin the first day of January in each year.
ARTICLE 8
SEAL
8.1 The corporate seal shall have inscribed thereon the name of the
corporation, the year of its organization and the words "Corporate Seal,
Delaware". Said seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
ARTICLE 9
AMENDMENTS
9.1 These by-laws may be altered or repealed at any regular meeting of the
stockholders or at any special meeting of the stockholders at which a quorum is
present or represented by the affirmative vote of a majority of the stock
entitled to vote at such meeting and present or represented thereat, or by the
affirmative vote of a majority of the board of directors at any regular meeting
of the board or at any special meeting of the board if notice of the proposed
alteration or repeal be contained in the notice of such special meeting.
-13-
<PAGE>
Exhibit 4.1
================================================================================
NORTH AMERICAN VAN LINES, INC.
THE NOTE GUARANTORS PARTY HERETO
and
STATE STREET BANK AND TRUST COMPANY,
as Trustee
----------
INDENTURE
Dated as of November 19, 1999
----------
13 3/8% Senior Subordinated Notes due 2009
================================================================================
<PAGE>
Table of Contents
Page
----
ARTICLE 1 DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION .............1
Section 1.01 Definitions ................................................1
Section 1.02 Other Definitions .........................................33
Section 1.03 Rules of Construction .....................................34
Section 1.04 Incorporation by Reference of TIA .........................34
Section 1.05 Conflict with TIA .........................................35
Section 1.06 Compliance Certificates and Opinions ......................35
Section 1.07 Form of Documents Delivered to Trustee ....................35
Section 1.08 Acts of Noteholders; Record Dates .........................36
Section 1.09 Notices, etc., to Trustee and Company .....................38
Section 1.10 Notices to Holders; Waiver ................................38
Section 1.11 Effect of Headings and Table of Contents ..................39
Section 1.12 Successors and Assigns ....................................39
Section 1.13 Separability Clause .......................................39
Section 1.14 Benefits of Indenture .....................................39
Section 1.15 GOVERNING LAW .............................................39
Section 1.16 Legal Holidays ............................................39
Section 1.17 No Personal Liability of Directors, Officers,
Employees, Incorporators and Stockholders .................39
Section 1.18 Exhibits and Schedules ....................................40
Section 1.19 Counterparts ..............................................40
ARTICLE 2 NOTE FORMS .........................................................40
Section 2.01 Forms Generally ...........................................40
Section 2.02 Form of Trustee's Certificate of Authentication ...........41
Section 2.03 Restrictive and Global Note Legends .......................41
ARTICLE 3 THE NOTES ..........................................................44
Section 3.01 Title and Terms ...........................................44
Section 3.02 Denominations .............................................44
Section 3.03 Execution, Authentication and Delivery and Dating .........44
Section 3.04 Temporary Notes ...........................................45
Section 3.05 Registration, Registration of Transfer and Exchange .......45
Section 3.06 Mutilated, Destroyed, Lost and Stolen Notes ...............46
Section 3.07 Payment of Interest Rights Preserved ......................47
Section 3.08 Persons Deemed Owners .....................................48
Section 3.09 Cancellation ..............................................48
Section 3.10 Computation of Interest ...................................48
Section 3.11 CUSIP Numbers .............................................48
i
<PAGE>
Section 3.12 Book-Entry Provisions for Global Notes ....................48
Section 3.13 Special Transfer Provisions. Transfers to Non-U.S.
Persons. (1) The following provisions shall apply
with respect to the registration of any proposed
transfer of a Note that is a Restricted Security to
any Non-U.S. Person: The Note Registrar shall
register such transfer if it complies with all other
applicable requirements of this Indenture (including
Section 3.05) and, ........................................50
Section 3.14 Payment of Additional Interest ............................53
ARTICLE 4 COVENANTS ..........................................................53
Section 4.01 Payment of Principal, Premium and Interest ................53
Section 4.02 Maintenance of Office or Agency ...........................53
Section 4.03 Money for Payments To Be Held in Trust ....................53
Section 4.04 SEC Reports ...............................................54
Section 4.05 Statement as to Default ...................................55
Section 4.06 Limitation on Indebtedness ................................55
Section 4.07 Limitation on Layering ....................................58
Section 4.08 Limitation on Restricted Payments. ........................58
Section 4.09 Limitation on Restrictions on Distributions from
Restricted Subsidiaries ...................................62
Section 4.10 Limitation on Sales of Assets and Subsidiary Stock ........63
Section 4.11 Limitation on Transactions with Affiliates ................66
Section 4.12 Limitation on Liens .......................................67
Section 4.13 Future Note Guarantors ....................................68
Section 4.14 Purchase of Notes Upon a Change in Control ................68
ARTICLE 5 SUCCESSOR COMPANY ..................................................69
Section 5.01 When the Company May Merge, etc ...........................69
Section 5.02 Successor Company Substituted .............................70
ARTICLE 6 REMEDIES ...........................................................70
Section 6.01 Events of Default .........................................70
Section 6.02 Acceleration of Maturity; Rescission and Annulment ........72
Section 6.03 Other Remedies; Collection Suit by Trustee ................73
Section 6.04 Trustee May File Proofs of Claim ..........................73
Section 6.05 Trustee May Enforce Claims Without Possession of Notes ....74
Section 6.06 Application of Money Collected ............................74
Section 6.07 Limitation on Suits. No Holder may pursue any remedy
with respect to this Indenture or the Notes unless: ......74
Section 6.08 Unconditional Right of Holders to Receive
Principal and Interest ....................................75
Section 6.09 Restoration of Rights and Remedies ........................75
Section 6.10 Rights and Remedies Cumulative ............................75
ii
<PAGE>
Section 6.11 Delay or Omission Not Waiver ..............................75
Section 6.12 Control by Holders ........................................75
Section 6.13 Waiver of Past Defaults ...................................76
Section 6.14 Undertaking for Costs .....................................76
Section 6.15 Waiver of Stay, Extension or Usury Laws ...................77
ARTICLE 7 THE TRUSTEE ........................................................77
Section 7.01 Certain Duties and Responsibilities .......................77
Section 7.02 Notice of Defaults ........................................78
Section 7.03 Certain Rights of Trustee .................................78
Section 7.04 Not Responsible for Recitals or Issuance of Notes .........79
Section 7.05 May Hold Notes ............................................79
Section 7.06 Money Held in Trust .......................................79
Section 7.07 Compensation and Reimbursement ............................79
Section 7.08 Conflicting Interests .....................................80
Section 7.09 Corporate Trustee Required; Eligibility ...................80
Section 7.10 Resignation and Removal; Appointment of Successor .........80
Section 7.11 Acceptance of Appointment by Successor ....................81
Section 7.12 Merger, Conversion, Consolidation or Succession
to Business ...............................................82
Section 7.13 Preferential Collection of Claims Against the Company .....82
Section 7.14 Appointment of Authenticating Agent .......................82
ARTICLE 8 HOLDERS' LISTS AND REPORTS BY TRUSTEE AND THE COMPANY ..............82
Section 8.01 The Company to Furnish Trustee Names and
Addresses of Holders ......................................82
Section 8.02 Preservation of Information; Communications to
Holders ...................................................83
Section 8.03 Reports by Trustee ........................................83
ARTICLE 9 AMENDMENT, SUPPLEMENT OR WAIVER ....................................83
Section 9.01 Without Consent of Holders ................................83
Section 9.02 With Consent of Holders ...................................84
Section 9.03 Execution of Amendments, Supplements or Waivers ...........85
Section 9.04 Revocation and Effect of Consents .........................85
Section 9.05 Conformity with TIA .......................................86
Section 9.06 Notation on or Exchange of Notes ..........................86
ARTICLE 10 REDEMPTION OF NOTES ...............................................86
Section 10.01 Right of Redemption ......................................86
Section 10.02 Applicability of Article .................................87
Section 10.03 Election to Redeem; Notice to Trustee ....................87
Section 10.04 Selection by Trustee of Notes to Be Redeemed .............87
Section 10.05 Notice of Redemption .....................................87
iii
<PAGE>
Section 10.06 Deposit of Redemption Price ..............................88
Section 10.07 Notes Payable on Redemption Date .........................88
Section 10.08 Notes Redeemed in Part ...................................89
ARTICLE 11 SATISFACTION AND DISCHARGE ........................................89
Section 11.01 Satisfaction and Discharge of Indenture ..................89
Section 11.02 Application of Trust Money ...............................90
ARTICLE 12 DEFEASANCE OR COVENANT DEFEASANCE .................................90
Section 12.01 The Company's Option to Elect Defeasance or
Covenant Defeasance ......................................90
Section 12.02 Defeasance and Discharge .................................90
Section 12.03 Covenant Defeasance ......................................91
Section 12.04 Conditions to Defeasance or Covenant Defeasance ..........91
Section 12.05 Deposited Money and U.S. Government Obligations
To Be Held in Trust; Other Miscellaneous Provisions ......93
Section 12.06 Reinstatement ............................................93
Section 12.07 Repayment to the Company .................................93
ARTICLE 13 NOTE GUARANTEES ...................................................94
Section 13.01 Guarantees Generally .....................................94
Section 13.02 Continuing Guarantees ....................................95
Section 13.03 Release of Note Guarantees ...............................96
Section 13.04 Agreement to Subordinate .................................96
Section 13.05 Waiver of Subrogation ....................................96
Section 13.06 Notation Not Required ....................................97
Section 13.07 Successors and Assigns of the Note Guarantors ............97
Section 13.08 Execution and Delivery of Note Guarantees ................97
Section 13.09 Notices ..................................................97
ARTICLE 14 SUBORDINATION .....................................................97
Section 14.01 Agreement To Subordinate .................................97
Section 14.02 Liquidation, Dissolution, Bankruptcy .....................98
Section 14.03 Default on Senior Indebtedness ...........................98
Section 14.04 Acceleration of Payment of Notes .........................99
Section 14.05 When a Distribution Must Be Paid Over ....................99
Section 14.06 Subrogation ..............................................99
Section 14.07 Relative Rights ..........................................99
Section 14.08 Subordination May Not Be Impaired by Issuers ............100
Section 14.09 Rights of Trustee and Paying Agent ......................100
Section 14.10 Distribution or Notice to Representative ................100
Section 14.11 Article 14 Not To Prevent Events of Default or
Limit Right To Accelerate ...............................100
Section 14.12 Trust Moneys Not Subordinated ...........................100
iv
<PAGE>
Section 14.13 Trustee Entitled To Rely ................................101
Section 14.14 Trustee To Effectuate Subordination .....................101
Section 14.15 Trustee Not Fiduciary for Holders of Senior
Indebtedness ............................................101
Section 14.16 Reliance by Holders of Senior Indebtedness on
Subordination Provisions ................................101
Section 14.17 Trustee's Compensation Not Prejudiced ...................101
ARTICLE 15 SUBORDINATION OF NOTE GUARANTEES .................................102
Section 15.01 Agreement To Subordinate ................................102
Section 15.02 Liquidation, Dissolution, Bankruptcy ....................102
Section 15.03 Default on Guarantor Senior Indebtedness ................102
Section 15.04 Acceleration of Payment of Notes ........................103
Section 15.05 When a Distribution Must Be Paid Over ...................104
Section 15.06 Subrogation .............................................104
Section 15.07 Relative Rights .........................................104
Section 15.08 Subordination May Not Be Impaired by Note
Guarantors ..............................................104
Section 15.09 Rights of Trustee and Paying Agent ......................104
Section 15.10 Distribution or Notice to Representative ................105
Section 15.11 Article 15 Not To Prevent Events of Default or
Limit Right To Accelerate ...............................105
Section 15.12 Trust Moneys Not Subordinated ...........................105
Section 15.13 Trustee Entitled To Rely ................................105
Section 15.14 Trustee To Effectuate Subordination .....................106
Section 15.15 Trustee Not Fiduciary for Holders of Guarantor
Senior Indebtedness .....................................106
Section 15.16 Reliance by Holders of Senior Indebtedness on
Subordination Provisions ................................106
Section 15.17 Trustee's Compensation Not Prejudiced ...................106
Exhibit A Form of Note
Exhibit B Form of Supplemental Indenture
Exhibit C Form of Regulation S Certificate
Exhibit D Form of Certificate of Beneficial Ownership
v
<PAGE>
Certain Sections of this Indenture relating to Section 3.10 through 3.18
inclusive of the Trust Indenture Act of 1939:
Trust Indenture Act Section Indenture Section
- --------------------------- -----------------
ss.3.10(a)(1) .................................... 7.09
(a)(2) .................................... 7.09
(a)(3) .................................... Not Applicable
(a)(4) .................................... Not Applicable
(b) .................................... 7.08
ss.311 (a) .................................... 7.13
(b) .................................... 7.13
(b)(2) .................................... 8.03
8.03
ss.312(a) .................................... 8.01
8.02
(b) .................................... 8.02
(c) .................................... 8.02
ss.313(a) .................................... 8.03
(b) .................................... 8.03
(c) .................................... 8.03
8.03
(d) .................................... 8.03
ss.314(a) .................................... 4.04
(a)(4) .................................... 1.02
4.05
(b) .................................... Not Applicable
(c)(1) .................................... 1.02
(c)(2) .................................... 1.02
(c)(3) .................................... Not Applicable
(d) .................................... Not Applicable
(e) .................................... 1.02
ss.315(a) .................................... 7.01
(b) .................................... 7.02
8.03
(c) .................................... 7.01
(d) .................................... 7.01
(d)(1) .................................... 7.01
(d)(2) .................................... 7.01
(d)(3) .................................... 7.01
(e) .................................... 6.14
ss.316(a) .................................... 1.01
6.12
(a)(1)(A) .................................... 6.02
6.12
(a)(1)(B) .................................... 6.13
(a)(2) .................................... Not Applicable
(b) .................................... 6.08
(c) .................................... 1.04
ss.317(a)(1) .................................... 6.03
(a)(2) .................................... 6.04
(b) .................................... 4.03
ss.318(a) .................................... 1.07
- ----------
This cross-reference table shall not for any purpose be deemed to be part of
this Indenture.
vi
<PAGE>
INDENTURE, dated as of November 19, 1999 (as amended, supplemented
or otherwise modified from time to time, the "Indenture"), among North American
Van Lines, Inc., a corporation organized under the laws of the State of
Delaware, the Note Guarantors (as defined below) and State Street Bank and Trust
Company, a Massachusetts trust company, as trustee (the "Trustee").
RECITALS OF THE COMPANY
The Company and the Note Guarantors have duly authorized the
execution and delivery of this Indenture to provide for the issuance of the
Notes and the Note Guarantees.
All things necessary to make the Original Notes, when executed and
delivered by the Company and authenticated and delivered by the Trustee
hereunder and duly issued by the Company, the valid obligation of the Company,
and to make this Indenture a valid agreement of the Company as of the date
hereof, in accordance with the terms of the Original Notes and this Indenture,
have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Notes by the Holders thereof, it is mutually agreed, for the equal and ratable
benefit of all Holders of the Notes, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
Section 1.01 Definitions.
"Acquired Debt" means Indebtedness of any Person that is assumed by
the Company or any Restricted Subsidiary in connection with its acquisition of
assets from such Person or any Affiliate thereof or is issued and outstanding on
or prior to the date on which such Person was acquired by the Company or any
Restricted Subsidiary or merged or consolidated with or into the Company or any
Restricted Subsidiary (other than Indebtedness Incurred to finance, or otherwise
in connection with or in contemplation of, such acquisition).
"Additional Assets" means (i) any property or assets that replace
the property or assets that are the subject of an Asset Disposition; (ii) any
property or assets (other than Indebtedness and Capital Stock) to be used by the
Company or a Restricted Subsidiary in a Related Business; (iii) the Capital
Stock of a Person that is engaged in a Related Business and becomes a Restricted
Subsidiary as a result of the acquisition of such Capital Stock by the Company
or another Restricted Subsidiary; or (iv) Capital Stock of any Person that at
such time is a Restricted Subsidiary, acquired from a third party.
<PAGE>
"Additional Notes" means any notes issued under this Indenture in
addition to the Original Notes (other than any Notes issued pursuant to Section
3.04, 3.05, 3.06, 3.12(c), 3.12(d) or 10.08).
"Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any moving or storage company or contractor, or other
Person, that provides sales, packing, warehousing, hauling or other services in
connection with the ordinary course of business or operations of the Company or
any of its Subsidiaries, or any Affiliate of any such Agent.
"Agent Guarantee" means any Guarantee by the Company or any
Restricted Subsidiary of Indebtedness or other obligations of any Agent, entered
into in accordance with this Indenture.
"all or substantially all" has the meaning given to such phrase in
the Revised Model Business Corporation Act and commentary thereto.
"Allied Acquisition" means the acquisition of Capital Stock and/or
assets of certain Subsidiaries of NFC plc engaged in moving services businesses
pursuant to the Acquisition Agreement dated as of September 14, 1999 between
Holding and NFC plc, and the other transactions contemplated thereby.
"Asset Disposition" means any sale, lease, transfer or other
disposition of shares of Capital Stock of a Restricted Subsidiary (other than
directors' qualifying shares, or (in the case of a Foreign Subsidiary) to the
extent required by applicable law), property or other assets (each referred to
for the purposes of this definition as a "disposition") by the Company or any of
its Restricted Subsidiaries (including any disposition by means of a merger,
consolidation or similar transaction), other than (i) a disposition to the
Company or a Restricted Subsidiary, (ii) a disposition in the ordinary course of
business, (iii) the sale or discount (with or without recourse, and on customary
or commercially reasonable terms) of accounts receivable or notes receivable
arising in the ordinary course of business, or the conversion or exchange of
accounts receivable for notes receivable, (iv) any Restricted Payment
Transactions, (v) a disposition that is governed by the provisions described
under Article 5, (vi) any Financing Disposition, (vii) any "fee in lieu" or
other disposition of assets to any governmental authority or agency that
continue in use by the Company or any Restricted Subsidiary, so long as the
Company or any Restricted Subsidiary may obtain title to such assets upon
reasonable notice by paying a nominal fee, (viii) any exchange of like property
pursuant to Section 1031 (or any successor section) of the Code, (ix) any
financing transaction with respect to property built or acquired by the Company
or any Restricted Subsidiary after the Issue Date, including without limitation
any sale/leaseback transaction or asset securitization, (x) any disposition
arising from foreclosure, condemnation or similar action with respect to any
property or other assets, (xi) any disposition of Capital Stock,
2
<PAGE>
Indebtedness or other securities of an Unrestricted Subsidiary, (xii) a
disposition of Capital Stock of a Restricted Subsidiary pursuant to an agreement
or other obligation with or to a Person (other than the Company or a Restricted
Subsidiary) from whom such Restricted Subsidiary was acquired, or from whom such
Restricted Subsidiary acquired its business and assets (having been newly formed
in connection with such acquisition), entered into in connection with such
acquisition, (xiii) a disposition of not more than 5% of the outstanding Capital
Stock of a Foreign Subsidiary to one or more members of the management of such
Foreign Subsidiary that has been approved by the Board of Directors, or (xiv)
any disposition or series of related dispositions for aggregate consideration
not to exceed $2.5 million.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 7.14 to act on behalf of the Trustee to authenticate Notes
of one or more series.
"Average Life" means, as of the date of determination, with respect
to any Indebtedness or Preferred Stock, the quotient obtained by dividing (i)
the sum of the products of the numbers of years from the date of determination
to the dates of each successive scheduled principal payment of such Indebtedness
or redemption or similar payment with respect to such Preferred Stock multiplied
by the amount of such payment by (ii) the sum of all such payments.
"Bank Indebtedness" means any and all amounts, whether outstanding
on the Issue Date or thereafter incurred, payable under or in respect of the
Senior Credit Facility, including without limitation principal, premium (if
any), interest (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company or any
Restricted Subsidiary whether or not a claim for post-filing interest is allowed
in such proceedings), fees, charges, expenses, reimbursement obligations,
guarantees, other monetary obligations of any nature and all other amounts
payable thereunder or in respect thereof.
"Board of Directors" means the board of directors or other governing
body of the Company or, if the Company is owned or managed by a single entity,
the board of directors or other governing body of such entity, or, in either
case, any committee thereof duly authorized to act on behalf of such board or
governing body.
"Borrowing Base" means 85% of accounts receivables of the Company
and its Restricted Subsidiaries (determined in accordance with GAAP as of the
end of the most recently ended fiscal quarter for which consolidated financial
statements of the Company are available).
"Business Day" means a day other than a Saturday, Sunday or other
day on which commercial banking institutions are authorized or required by law
to close in New York City.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"Capitalized Lease Obligation" means an obligation that is required
to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP. The Stated Maturity of any
Capitalized Lease Obligation shall be the date of the last payment of rent or
any other amount due under the related lease.
3
<PAGE>
"Cash Equivalents" means any of the following: (a) securities issued
or fully guaranteed or insured by the United States Government or any agency or
instrumentality thereof, (b) time deposits, certificates of deposit or bankers'
acceptances of (i) any lender under the Senior Credit Agreement or (ii) any
commercial bank having capital and surplus in excess of $500,000,000 and the
commercial paper of the holding company of which is rated at least A-1 or the
equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moody's
(or if at such time neither is issuing ratings, then a comparable rating of
another nationally recognized rating agency), (c) commercial paper rated at
least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent
thereof by Moody's (or if at such time neither is issuing ratings, then a
comparable rating of another nationally recognized rating agency) and (d)
investments in money market funds complying with the risk limiting conditions of
Rule 2a-7 or any successor rule of the SEC under the Investment Company Act of
1940, as amended.
"CDR" means Clayton, Dubilier & Rice, Inc.
"CDR Fund V" means Clayton, Dubilier & Rice Fund V Limited
Partnership, a Cayman Islands exempted limited partnership, and any successor in
interest thereto.
"Change of Control" means:
(i) any "person" (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act), other than one or more Permitted Holders or Holding,
is or becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act), directly or indirectly, of more than 50% of the
total voting power of the Voting Stock of the Company, provided that so
long as the Company is a Subsidiary of Holding, no Person shall be deemed
to be or become a "beneficial owner" of more than 50% of the total voting
power of the Voting Stock of the Company unless such Person shall be or
become a "beneficial owner" of more than 50% of the total voting power of
the Voting Stock of Holding;
(ii) the Company sells or transfers (in one or a series of related
transactions) all or substantially all of the assets of the Company and
its Restricted Subsidiaries to another Person (other than one or more
Permitted Holders or Holding or one or more Subsidiaries thereof); or
(iii) during any period of two consecutive years (during which
period the Company has been a party to this Indenture), individuals who at
the beginning of such period were members of the board of directors of the
Company (together with any new members thereof whose election by such
board of directors or whose nomination for election by holders of Capital
Stock of the Company was approved by one or more Permitted Holders or by a
vote of a majority of the members of such board of directors then still in
office who were either members thereof at the beginning of such period or
whose election or nomination for election was previously so approved)
cease for any reason to constitute a majority of such board of directors
then in office.
"Change of Control Triggering Event" means the occurrence after the
Issue Date of both (a) a Change of Control and (b) the failure of the Notes to
have, on the 30th day after
4
<PAGE>
such Change of Control, a rating of at least "BBB-" (or equivalent successor
rating) by S&P and a rating of at least "Baa3" (or equivalent successor rating)
by Moody's.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means North American Van Lines, Inc., a Delaware
Corporation, and any successor in interest thereto.
"Company Request," "Company Order" and "Company Consent" mean,
respectively, a written request, order or consent signed in the name of the
Company by an Officer of the Company.
"Consolidated Coverage Ratio" as of any date of determination means
the ratio of (i) the aggregate amount of Consolidated EBITDA of the Company and
its Restricted Subsidiaries for the period of the most recent four consecutive
fiscal quarters ending prior to the date of such determination for which
consolidated financial statements of the Company are available to (ii)
Consolidated Interest Expense for such four fiscal quarters (in each case,
determined, for each fiscal quarter (or portion thereof) of the four fiscal
quarters ending prior to the Issue Date, on a pro forma basis to give effect to
the Allied Acquisition as if it had occurred at the beginning of such
four-quarter period); provided, that:
(1) if since the beginning of such period the Company or any
Restricted Subsidiary has Incurred any Indebtedness that remains
outstanding on such date of determination or if the transaction giving
rise to the need to calculate the Consolidated Coverage Ratio is an
Incurrence of Indebtedness, Consolidated EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving effect on a pro
forma basis to such Indebtedness as if such Indebtedness had been Incurred
on the first day of such period (except that in making such computation,
the amount of Indebtedness under any revolving credit facility outstanding
on the date of such calculation shall be computed based on (A) the average
daily balance of such Indebtedness during such four fiscal quarters or
such shorter period for which such facility was outstanding or (B) if such
facility was created after the end of such four fiscal quarters, the
average daily balance of such Indebtedness during the period from the date
of creation of such facility to the date of such calculation),
(2) if since the beginning of such period the Company or any
Restricted Subsidiary has repaid, repurchased, redeemed, defeased or
otherwise acquired, retired or discharged any Indebtedness (each, a
"Discharge") or if the transaction giving rise to the need to calculate
the Consolidated Coverage Ratio involves a Discharge of Indebtedness (in
each case other than Indebtedness Incurred under any revolving credit
facility unless such Indebtedness has been permanently repaid),
Consolidated EBITDA and Consolidated Interest Expense for such period
shall be calculated after giving effect on a pro forma basis to such
Discharge of such Indebtedness, including with the proceeds of such new
Indebtedness, as if such Discharge had occurred on the first day of such
period,
(3) if since the beginning of such period the Company or any
Restricted Subsidiary shall have disposed of any company, any business or
any group of assets
5
<PAGE>
constituting an operating unit of a business (any such disposition, a
"Sale"), the Consolidated EBITDA for such period shall be reduced by an
amount equal to the Consolidated EBITDA (if positive) attributable to the
assets that are the subject of such Sale for such period or increased by
an amount equal to the Consolidated EBITDA (if negative) attributable
thereto for such period and Consolidated Interest Expense for such period
shall be reduced by an amount equal to (A) the Consolidated Interest
Expense attributable to any Indebtedness of the Company or any Restricted
Subsidiary repaid, repurchased, redeemed, defeased or otherwise acquired,
retired or discharged with respect to the Company and its continuing
Restricted Subsidiaries in connection with such Sale for such period
(including but not limited to through the assumption of such Indebtedness
by another Person) plus (B) if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Interest Expense for such period
attributable to the Indebtedness of such Restricted Subsidiary to the
extent the Company and its continuing Restricted Subsidiaries are no
longer liable for such Indebtedness after such Sale,
(4) if since the beginning of such period the Company or any
Restricted Subsidiary (by merger, consolidation or otherwise) shall have
made an Investment in any Person that thereby becomes a Restricted
Subsidiary, or otherwise acquired any company, any business or any group
of assets constituting an operating unit of a business, including any such
Investment or acquisition occurring in connection with a transaction
causing a calculation to be made hereunder (any such Investment or
acquisition, a "Purchase"), Consolidated EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving pro forma effect
thereto (including the Incurrence of any related Indebtedness) as if such
Purchase occurred on the first day of such period, and
(5) if since the beginning of such period any Person became a
Restricted Subsidiary or was merged or consolidated with or into the
Company or any Restricted Subsidiary, and since the beginning of such
period such Person shall have Discharged any Indebtedness or made any Sale
or Purchase that would have required an adjustment pursuant to clause (2),
(3) or (4) above if made by the Company or a Restricted Subsidiary during
such period, Consolidated EBITDA and Consolidated Interest Expense for
such period shall be calculated after giving pro forma effect thereto as
if such Discharge, Sale or Purchase occurred on the first day of such
period.
For purposes of this definition, whenever pro forma effect is to be
given to any Sale, Purchase or other transaction, or the amount of income or
earnings relating thereto and the amount of Consolidated Interest Expense
associated with any Indebtedness Incurred or repaid, repurchased, redeemed,
defeased or otherwise acquired, retired or discharged in connection therewith,
the pro forma calculations in respect thereof may include anticipated cost
savings relating to any such Sale, Purchase or other transaction that the
Company reasonably believes in good faith could have been achieved during the
relevant four quarter period as a result of such Sale, Purchase or other
transaction (provided that both (i) such cost savings were identified and
quantified in an Officer's Certificate delivered to the Trustee at the time of
the consummation of such transaction and (ii) with respect to each such
transaction completed prior to the 90th day preceding the relevant date of
determination, actions were commenced or initiated by the Company within 90 days
of the consummation of such transaction to effect such cost savings identified
in such Officer's Certificate and with respect to any other transaction, such
Officer's
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Certificate sets forth the specific steps to be taken within the 90 days after
the consummation of such transaction to accomplish such cost savings). If any
Indebtedness bears a floating rate of interest and is being given pro forma
effect, the interest expense on such Indebtedness shall be calculated as if the
rate in effect on the date of determination had been the applicable rate for the
entire period (taking into account any Interest Rate Agreement applicable to
such Indebtedness). If any Indebtedness bears, at the option of the Company or a
Restricted Subsidiary, a rate of interest based on a prime or similar rate, a
eurocurrency interbank offered rate or other fixed or floating rate, and such
Indebtedness is being given pro forma effect, the interest expense on such
Indebtedness shall be calculated by applying such optional rate as the Company
or such Restricted Subsidiary may designate. If any Indebtedness that is being
given pro forma effect was Incurred under a revolving credit facility, the
interest expense on such Indebtedness shall be computed based upon the average
daily balance of such Indebtedness during the applicable period. Interest on a
Capitalized Lease Obligation shall be deemed to accrue at an interest rate
determined in good faith by a responsible financial or accounting officer of the
Company to be the rate of interest implicit in such Capitalized Lease Obligation
in accordance with GAAP.
"Consolidated EBITDA" means, for any period, the Consolidated Net
Income for such period, plus the following to the extent deducted in calculating
such Consolidated Net Income: (i) provision for all taxes (whether or not paid,
estimated or accrued) based on income, profits or capital, (ii) Consolidated
Interest Expense, (iii) depreciation, amortization (including but not limited to
amortization of goodwill and intangibles and amortization and write-off of
financing costs) and all other non-cash charges or non-cash losses, (iv) any
expenses or charges related to any Equity Offering, Investment or Indebtedness
permitted by this Indenture (whether or not consummated or incurred) and (v) the
amount of any minority interest expense. To the extent Consolidated EBITDA would
otherwise include the amount of any Receivables Fees excluded from Consolidated
Interest Expense pursuant to clause (iii) of the definition of Consolidated
Interest Expense, Consolidated EBITDA shall be reduced by such amount.
"Consolidated Interest Expense" means, for any period, (i) the total
interest expense of the Company and its Restricted Subsidiaries to the extent
deducted in calculating Consolidated Net Income, net of any interest income of
the Company and its Restricted Subsidiaries, including without limitation any
such interest expense consisting of (a) interest expense attributable to
Capitalized Lease Obligations, (b) amortization of debt discount, (c) interest
in respect of Indebtedness of any other Person that has been Guaranteed by the
Company or any Restricted Subsidiary of the Company (other than Indebtedness
Guaranteed under any Management Guarantee or Agent Guarantee, except to the
extent the interest thereon is actually being paid by the Company or a
Restricted Subsidiary thereof), (d) non-cash interest expense, (e) the interest
portion of any deferred payment obligation, and (f) commissions, discounts and
other fees and charges owed with respect to letters of credit and bankers'
acceptance financing, plus (ii) dividends paid in cash in respect of
Disqualified Stock of the Company or a Restricted Subsidiary or in respect of
Preferred Stock of a Restricted Subsidiary of the Company and minus (iii) to the
extent otherwise included in such interest expense referred to in clause (i)
above, Receivables Fees and amortization or write-off of financing costs, in
each case under clauses (i) through (iii) as determined on a Consolidated basis
in accordance with GAAP; provided, that gross interest expense shall be
determined after giving effect to any net payments made or received by the
Company and its Restricted Subsidiaries with respect to Interest Rate
Agreements.
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"Consolidated Net Income" means, for any period, the net income
(loss) of the Company and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP and before any reduction in respect
of Preferred Stock dividends; provided, that there shall not be included in such
Consolidated Net Income:
(i) any net income (loss) of any Person if such Person is not a
Restricted Subsidiary, except that (A) subject to the limitations
contained in clause (iv) below, the Company's equity in the net income of
any such Person for such period shall be included in such Consolidated Net
Income up to the aggregate amount actually distributed by such Person
during such period to the Company or a Restricted Subsidiary of the
Company as a dividend or other distribution (subject, in the case of a
dividend or other distribution to a Restricted Subsidiary of the Company,
to the limitations contained in clause (iii) below) and (B) the Company's
equity in the net loss of such Person shall be included to the extent of
the aggregate Investment of the Company or any of its Restricted
Subsidiaries in such Person,
(ii) any net income (loss) of any Person acquired by the Company or
a Restricted Subsidiary of the Company in a pooling of interests
transaction for any period prior to the date of such acquisition,
(iii) any net income (loss) of any Restricted Subsidiary of the
Company if such Restricted Subsidiary is subject to restrictions, directly
or indirectly, on the payment of dividends or the making of similar
distributions by such Restricted Subsidiary, directly or indirectly, to
the Company by operation of the terms of such Restricted Subsidiary's
charter or any agreement, instrument, judgment, decree, order, statute or
governmental rule or regulation applicable to such Restricted Subsidiary
or its stockholders (other than (x) restrictions that have been waived or
otherwise released, (y) restrictions pursuant to the Notes or this
Indenture and (z) restrictions in effect on the Issue Date with respect to
a Restricted Subsidiary and other restrictions with respect to such
Restricted Subsidiary that taken as a whole are not materially less
favorable to the Noteholders than such restrictions in effect on the Issue
Date), except that (A) subject to the limitations contained in clause (iv)
below, the Company's equity in the net income of any such Restricted
Subsidiary for such period shall be included in such Consolidated Net
Income up to the aggregate amount of any dividend or distribution that was
or that could have been made by such Restricted Subsidiary during such
period to the Company or another Restricted Subsidiary of the Company
(subject, in the case of a dividend that could have been made to another
Restricted Subsidiary, to the limitation contained in this clause) and (B)
the net loss of such Restricted Subsidiary shall be included to the extent
of the aggregate Investment of the Company or any of its other Restricted
Subsidiaries in such Restricted Subsidiary,
(iv) any gain or loss realized upon the sale or other disposition of
any asset of the Company or any Restricted Subsidiary of the Company
(including pursuant to any sale/leaseback transaction) that is not sold or
otherwise disposed of in the ordinary course of business (as determined in
good faith by the Board of Directors),
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(v) any item classified as an extraordinary, unusual or nonrecurring
gain, loss or charge (including without limitation (a) any compensation
expense for stock options that will be cashed out, converted, exchanged or
otherwise retired in connection with the Allied Acquisition, (b) any
charge or expense incurred for employee bonuses in connection with the
Allied Acquisition, and (c) fees, expenses and charges associated with the
Allied Acquisition or any acquisition, merger or consolidation after the
Issue Date),
(vi) the cumulative effect of a change in accounting principles,
(vii) all deferred financing costs written off and premiums paid in
connection with any early extinguishment of Indebtedness,
(viii) any unrealized gains or losses in respect of Currency
Agreements,
(ix) any unrealized foreign currency transaction gains or losses in
respect of Indebtedness of any Person denominated in a currency other than
the functional currency of such Person, and
(x) any non-cash compensation charge arising from any grant of
stock, stock options or other equity based awards.
In the case of any unusual or nonrecurring gain, loss or charge not
included in Consolidated Net Income pursuant to clause (v) above in any
determination thereof, the Company will deliver an Officer's Certificate to the
Trustee promptly after the date on which Consolidated Net Income is so
determined, setting forth the nature and amount of such unusual or nonrecurring
gain, loss or charge.
"Consolidated Tangible Assets" means, as of any date of
determination, the total assets less the total intangible assets (including,
without limitation, goodwill) shown on the consolidated balance sheet of the
Company and its Restricted Subsidiaries as of the most recent date for which
such a balance sheet is available, determined on a consolidated basis in
accordance with GAAP (and, in the case of any determination relating to any
Incurrence of Indebtedness or any Investment, on a pro forma basis including any
property or assets being acquired in connection therewith).
"Consolidation" means the consolidation of the accounts of each of
the Restricted Subsidiaries with those of the Company in accordance with GAAP;
provided that "Consolidation" will not include consolidation of the accounts of
any Unrestricted Subsidiary, but the interest of the Company or any Restricted
Subsidiary in any Unrestricted Subsidiary will be accounted for as an
investment. The term "Consolidated" has a correlative meaning.
"Corporate Trust Office" means the office of the Trustee in Boston,
Massachusetts, at which at any particular time its corporate trust business
shall be administered, which office on the Issue Date is located at 2 Avenue de
Lafayette, Boston, Massachusetts 07111-1724.
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"Credit Facilities" means, one or more of (x) the Senior Credit
Facility and (y) other facilities or arrangements, in each case with one or more
banks or other institutions providing for revolving credit loans, term loans,
receivables financings (including without limitation through the sale of
receivables to such institutions or to special purpose entities formed to borrow
from such institutions against such receivables), letters of credit or other
Indebtedness, in each case, including all agreements, instruments and documents
executed and delivered pursuant to or in connection with any of the foregoing,
in each case as the same may be amended, supplemented, waived or otherwise
modified from time to time, or refunded, refinanced, restructured, replaced,
renewed, repaid, increased or extended from time to time (whether in whole or in
part, whether with the original banks or other institutions or other banks or
other institutions or otherwise, and whether provided under any original Credit
Facility or one or more other credit agreements, indentures, financing
agreements or other Credit Facilities or otherwise). Without limiting the
generality of the foregoing, the term "Credit Facility" shall include any
agreement (i) changing the maturity of any Indebtedness incurred thereunder or
contemplated thereby, (ii) adding Subsidiaries of the Company as additional
borrowers or guarantors thereunder, (iii) increasing the amount of Indebtedness
incurred thereunder or available to be borrowed thereunder or (iv) otherwise
altering the terms and conditions thereof.
"Currency Agreement" means, in respect of a Person, any foreign
exchange contract, currency swap agreement or other similar agreement or
arrangements (including derivative agreements or arrangements), as to which such
Person is a party or a beneficiary.
"Default" means any event or condition that is, or after notice or
passage of time or both would be, an Event of Default.
"Depositary" means The Depository Trust Company, its nominees and
successors.
"Designated Noncash Assets" means any non-cash consideration
received by the Company or one of its Restricted Subsidiaries in connection with
an Asset Disposition that is designated as Designated Noncash Assets pursuant to
an Officer's Certificate executed by the principal financial officer of the
Company or such Restricted Subsidiary. Such Officer's Certificate shall state
the basis of valuation of such consideration which shall be the good faith
determination of the Board of Directors. The fair market value of each
outstanding item of Designated Noncash Assets shall equal its value measured at
the time received and without giving effect to subsequent changes in value, less
the amount of cash or Cash Equivalents received upon any subsequent sale or
other disposition of any portion thereof; provided that such cash and Cash
Equivalents are applied in accordance with Section 4.10, to the extent required
thereby.
"Designated Senior Indebtedness" means (i) the Bank Indebtedness and
(ii) any other Senior Indebtedness that, at the date of determination, has an
aggregate principal amount equal to or under which, at the date of
determination, the holders thereof are committed to lend up to, at least $25.0
million and is specifically designated by the Company in an agreement or
instrument evidencing or governing such Senior Indebtedness as "Designated
Senior Indebtedness" for purposes of this Indenture.
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"Disinterested Director" means, with respect to any Affiliate
Transaction, a member of the Board of Directors having no material direct or
indirect financial interest in or with respect to such Affiliate Transaction. A
member of the Board of Directors shall not be deemed to have such a financial
interest by reason of such member's holding Capital Stock of the Company or
Holding or any options, warrants or other rights in respect of such Capital
Stock.
"Disqualified Stock" means, with respect to any Person, any Capital
Stock (other than Management Stock) that by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable) or upon the happening of any event (i) matures or is mandatorily
redeemable pursuant to a sinking fund obligation or otherwise, (ii) is
convertible or exchangeable for Indebtedness or Disqualified Stock or (iii) is
redeemable at the option of the holder thereof, in whole or in part, in each
case on or prior to the 91st day following the final Stated Maturity of the
Notes. Notwithstanding the preceding sentence, (a) any Capital Stock that would
constitute Disqualified Stock solely because the holders thereof have the right
to require the Company to repurchase such Capital Stock upon the occurrence of
an event described therein as a change of control or an asset sale shall not
constitute Disqualified Stock if the terms of such Capital Stock provide that
the Company may not repurchase or redeem any such Capital Stock pursuant to such
provisions unless such repurchase or redemption complies with Section 4.08; and
(b) any Capital Stock that would constitute Disqualified Stock solely because
such Capital Stock is issued pursuant to any plan for the benefit of employees
and may be required to be repurchased by the Company in order to satisfy
applicable regulatory obligations shall not constitute Disqualified Stock.
"Domestic Subsidiary" means any Restricted Subsidiary of the Company
other than a Foreign Subsidiary.
"Equity Offering" means a sale of Capital Stock (other than
Disqualified Stock) (x) that is a sale of Capital Stock of the Company, or (y)
proceeds of which in an amount equal to or exceeding the Redemption Amount are
contributed to the Company or any of its Restricted Subsidiaries.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means the Company's 13 3/8% Senior Subordinated
Notes Due 2009, containing terms substantially identical to the Initial Notes
or any Initial Additional Notes (except that (i) such Exchange Notes shall
not contain terms with respect to transfer restrictions and shall be
registered under the Securities Act, and (ii) certain provisions relating to
an increase in the stated rate of interest thereon shall be eliminated), that
are issued and exchanged for (a) the Initial Notes, as provided for in a
registration rights agreement relating to such Initial Notes and this
Indenture, or (b) such Initial Additional Notes as may be provided in any
registration rights agreement relating to such Additional Notes and this
Indenture (including any amendment or supplement hereto).
"Financing Disposition" means any sale, transfer, conveyance or
other disposition of property or assets by the Company or any Subsidiary thereof
to any Receivables Entity, or by any Receivables Subsidiary, in each case in
connection with the Incurrence by a Receivables
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Entity of Indebtedness, or obligations to make payments to the obligor on
Indebtedness, which may be secured by a Lien in respect of such property or
assets.
"Foreign Subsidiary" means (a) any Restricted Subsidiary of the
Company that is not organized under the laws of the United States of America or
any state thereof or the District of Columbia and (b) any Restricted Subsidiary
of the Company that has no material assets other than securities of one or more
Foreign Subsidiaries, and other assets relating to an ownership interest in any
such securities or Subsidiaries.
"Foreign Subsidiary Coverage Ratio" as of any date of determination
means the ratio of (i) the combined portion attributable to Foreign
Subsidiaries, taken as a whole, of the aggregate amount of Consolidated EBITDA
of the Company and its Restricted Subsidiaries for the period of the most recent
four consecutive fiscal quarters ending prior to the date of such determination
for which consolidated financial statements of the Company are available to (ii)
the combined portion attributable to Foreign Subsidiaries, taken as a whole, of
Consolidated Interest Expense for such four fiscal quarters, all calculated
after giving effect to all intercompany eliminations applied in preparing the
relevant consolidated financial statements of the Company (and without giving
effect to clause (iii) of the definition of the term Consolidated Net Income as
it relates to restrictions on the payment of dividends or the making of similar
distributions by any Foreign Subsidiary to the Company or any Domestic
Subsidiary, but giving effect to such clause as it relates to any such
restrictions on the payment of dividends or the making of similar distributions
by any Foreign Subsidiary to another Foreign Subsidiary), and otherwise in
accordance with the definition of the term "Coverage Ratio" (including but not
limited to in accordance with all pro forma and other adjustments provided for
in such definition).
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the Issue Date (for purposes of the
definitions of the terms "Consolidated Coverage Ratio," "Foreign Subsidiary
Coverage Ratio," "Consolidated EBITDA," "Consolidated Interest Expense,"
"Consolidated Net Income" and "Consolidated Tangible Assets," all defined terms
in this Indenture to the extent used in or relating to any of the foregoing
definitions, and all ratios and computations based on any of the foregoing
definitions) and as in effect from time to time (for all other purposes of this
Indenture), including those set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as approved by
a significant segment of the accounting profession. All ratios and computations
based on GAAP contained in this Indenture shall be computed in conformity with
GAAP.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any other Person; provided that the term "Guarantee" shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Guarantor Designated Senior Indebtedness" means, with respect to
any Guarantor, (i) the Indebtedness of such Guarantor in respect of Bank
Indebtedness and (ii) any
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other Guarantor Senior Indebtedness of such Guarantor that, at the date of
determination, has an aggregate principal amount equal to or under which, at the
date of determination, the holders thereof are committed to lend up to, at least
$10.0 million and is specifically designated by such Guarantor in an agreement
or instrument evidencing or governing such Guarantor Senior Indebtedness as
"Guarantor Designated Senior Indebtedness" for purposes of this Indenture.
"Guarantor Senior Indebtedness" means, with respect to any Note
Guarantor, the following obligations, whether outstanding on the date hereof or
hereafter issued, without duplication: (i) any Guarantee of Bank Indebtedness by
such Note Guarantor and all other Guarantees by such Note Guarantor of Senior
Indebtedness of the Company or Guarantor Senior Indebtedness of any other Note
Guarantor; (ii) all obligations in respect of any Receivables Financing; and
(iii) all obligations consisting of the principal of and premium, if any, and
accrued and unpaid interest (including interest accruing on or after the filing
of any petition in bankruptcy or for reorganization relating to the Note
Guarantor regardless of whether post-filing interest is allowed in such
proceeding) on, and fees and other amounts owing in respect of, all other
Indebtedness of the Note Guarantor, unless, in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is
expressly provided that the obligations in respect of such Indebtedness are not
senior in right of payment to the obligations of such Note Guarantor under its
Note Guarantee; provided, however, that Guarantor Senior Indebtedness shall not
include (1) any obligations of such Note Guarantor to the Company or any other
Subsidiary of the Company, (2) any liability for Federal, state, local, foreign
or other taxes owed or owing by such Note Guarantor, (3) any accounts payable or
other liability to trade creditors arising in the ordinary course of business
(including Guarantees thereof or instruments evidencing such liabilities), (4)
any Indebtedness of such Note Guarantor (or Guarantee by such Note Guarantor of
Indebtedness) that is expressly subordinated in right of payment to any other
Indebtedness of such Note Guarantor (or Guarantee by such Note Guarantor of
Indebtedness), (5) any Capital Stock of such Note Guarantor or (6) that portion
of any Indebtedness of such Note Guarantor that is Incurred by such Note
Guarantor in violation of Section 4.06 (but no such violation shall be deemed to
exist for purposes of this clause (6) if any holder of such Indebtedness or such
holder's representative shall have received an Officer's Certificate to the
effect that such Incurrence of such Indebtedness does not (or that the
Incurrence by such Note Guarantor of the entire committed amount thereof at the
date on which the initial borrowing thereunder is made would not) violate
Section 4.06 ). If any Guarantor Senior Indebtedness is disallowed, avoided or
subordinated pursuant to the provisions of Section 548 of Title 11 of the United
States Code or any applicable state fraudulent conveyance law, such Guarantor
Senior Indebtedness nevertheless will constitute Guarantor Senior Indebtedness.
"Guarantor Senior Subordinated Indebtedness" means, with respect to
a Note Guarantor, (i) the obligations of such Note Guarantor under its Note
Guarantee and (ii) any other Indebtedness of such Note Guarantor that ranks pari
passu in right of payment with the obligations of such Note Guarantor under its
Note Guarantee.
"Guarantor Subordinated Obligations" means, with respect to a Note
Guarantor, any Indebtedness of such Note Guarantor (whether outstanding on the
Issue Date or thereafter Incurred) that is expressly subordinated in right of
payment to the obligations of such Note Guarantor under the Note Guarantee
pursuant to a written agreement.
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"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement or Currency Agreement.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered in the Note Register.
"Holding" means NA Holding Corporation, a Delaware corporation, and
any successor in interest thereto.
"Holding Expenses" means (i) costs (including all professional fees
and expenses) incurred by Holding to comply with its reporting obligations under
federal or state laws or under this Indenture or the Holding Notes, including
any reports filed with respect to the Securities Act, Exchange Act or the
respective rules and regulations promulgated thereunder, (ii) indemnification
obligations of Holding owing to directors, officers, employees or other Persons
under its charter or by-laws or pursuant to written agreements with any such
Person, (iii) fees and expenses payable by Holding in connection with the
Transactions, (iv) other operational expenses of Holding incurred in the
ordinary course of business, (v) expenses incurred by Holding in connection with
any public offering of Capital Stock or Indebtedness (x) where the net proceeds
of such offering are intended to be received by or contributed or loaned to the
Company or a Restricted Subsidiary, or (y) in a prorated amount of such expenses
in proportion to the amount of such net proceeds intended to be so received,
contributed or loaned, or (z) otherwise on an interim basis prior to completion
of such offering so long as Holding shall cause the amount of such expenses to
be repaid to the Company or the relevant Restricted Subsidiary out of the
proceeds of such offering promptly if completed, and (vi) interest payments on
the Holding Loan for any period or portion thereof ending on or prior to
December 31, 1999.
"Holding Loan" means $40.0 million in aggregate principal amount of
Indebtedness Incurred by Holding in connection with the Transactions.
"Holding Notes" means the senior discount notes due 2009 issued (or
any Indebtedness in lieu thereof Incurred) by Holding on the Issue Date, and any
refinancing in respect thereof, together with any agreement or instrument
evidencing, governing or otherwise relating to any of the foregoing.
"Holding Stock Issuance" means one or more issuances by Holding,
subsequent to the Issue Date, of Capital Stock of Holding for gross proceeds of
not less than $40.0 million in the aggregate.
"Incur" means issue, assume, enter into any Guarantee of, incur or
otherwise become liable for; provided, however, that any Indebtedness or Capital
Stock of a Person existing at the time such Person becomes a Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be
Incurred by such Subsidiary at the time it becomes a Subsidiary. Accrual of
interest, the accretion of accreted value and the payment of interest in the
form of additional Indebtedness will not be deemed to be an Incurrence of
Indebtedness. Any Indebtedness issued at a discount (including Indebtedness on
which interest is payable through the issuance of additional Indebtedness) shall
be deemed Incurred at the time
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of original issuance of the Indebtedness at the initial accreted amount thereof.
The term "Incurrence" shall have a correlative meaning.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication):
(i) the principal of indebtedness of such Person for borrowed money,
(ii) the principal of obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments,
(iii) all reimbursement obligations of such Person in respect of
letters of credit or other similar instruments (the amount of such
obligations being equal at any time to the aggregate then undrawn and
unexpired amount of such letters of credit or other instruments plus the
aggregate amount of drawings thereunder that have not then been
reimbursed),
(iv) all obligations of such Person to pay the deferred and unpaid
purchase price of property (except Trade Payables), which purchase price
is due more than one year after the date of placing such property in final
service or taking final delivery and title thereto,
(v) all Capitalized Lease Obligations of such Person,
(vi) the redemption, repayment or other repurchase amount of such
Person with respect to any Disqualified Stock of such Person or (if such
Person is a Subsidiary of the Company other than a Note Guarantor) any
Preferred Stock of such Subsidiary, but excluding, in each case, any
accrued dividends (the amount of such obligation to be equal at any time
to the maximum fixed involuntary redemption, repayment or repurchase price
for such Capital Stock, or if less (or if such Capital Stock has no such
fixed price), to the involuntary redemption, repayment or repurchase price
therefor calculated in accordance with the terms thereof as if then
redeemed, repaid or repurchased, and if such price is based upon or
measured by the fair market value of such Capital Stock, such fair market
value shall be as determined in good faith by the Board of Directors or
the board of directors or other governing body of the issuer of such
Capital Stock),
(vii) all Indebtedness of other Persons secured by a Lien on any
asset of such Person, whether or not such Indebtedness is assumed by such
Person; provided, that the amount of Indebtedness of such Person shall be
the lesser of (A) the fair market value of such asset at such date of
determination (as determined in good faith by the Company) and (B) the
amount of such Indebtedness of such other Persons,
(viii) Guarantees of all Indebtedness of other Persons to the extent
so Guaranteed by such Person, and
(ix) to the extent not otherwise included in this definition, net
Hedging Obligations of such Person (the amount of any such obligation to
be equal at any time to
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the termination value of such agreement or arrangement giving rise to such
Hedging Obligation that would be payable by such Person at such time).
The amount of Indebtedness of any Person at any date shall be
determined as set forth above or otherwise provided in this Indenture, or
otherwise shall equal the amount thereof that would appear on a balance sheet of
such Person (excluding any notes thereto) prepared in accordance with GAAP.
"Initial Additional Notes" means Additional Notes issued in an
offering not registered under the Securities Act.
"Initial Notes" means the Company's 13 3/8% Senior Subordinated
Notes due 2009, issued on the Issue Date pursuant to this Indenture (and any
Notes issued in respect thereof pursuant to Section 3.04, 3.05, 3.06,
3.12(c), 3.12(d) or 10.08).
"Interest Payment Date" means, when used with respect to any Note
and any installment of interest thereon, the date specified in such Note as the
fixed date on which such installment of interest is due and payable, as set
forth in such Note.
"Interest Rate Agreement" means, with respect to any Person, any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement (including derivative agreements or
arrangements), as to which such Person is party or a beneficiary.
"Inventory" means goods held for sale or lease by a Person in the
ordinary course of business, net of any reserve for goods that have been
segregated by such Person to be returned to the applicable vendor for credit, as
determined in accordance with GAAP.
"Investment" in any Person by any other Person means any direct or
indirect advance, loan or other extension of credit (other than to customers,
suppliers, Agents, directors, officers or employees of any Person in the
ordinary course of business) or capital contribution (by means of any transfer
of cash or other property to others or any payment for property or services for
the account or use of others) to, or any purchase or acquisition of Capital
Stock, Indebtedness or other similar instruments issued by, such Person. For
purposes of the definition of "Unrestricted Subsidiary" and Section 4.08, (i)
"Investment" shall include the portion (proportionate to the Company's equity
interest in such Subsidiary) of the fair market value of the net assets of any
Subsidiary of the Company at the time that such Subsidiary is designated an
Unrestricted Subsidiary, provided that upon a redesignation of such Subsidiary
as a Restricted Subsidiary, the Company shall be deemed to continue to have a
permanent "Investment" in an Unrestricted Subsidiary in an amount (if positive)
equal to (x) the Company's "Investment" in such Subsidiary at the time of such
redesignation less (y) the portion (proportionate to the Company's equity
interest in such Subsidiary) of the fair market value of the net assets of such
Subsidiary at the time of such redesignation, (ii) any property transferred to
or from an Unrestricted Subsidiary shall be valued at its fair market value at
the time of such transfer, and (iii) in each case under clause (i) or (ii)
above, fair market value shall be as determined in good faith by the Board of
Directors. A Guarantee shall not be deemed to be or give rise to an
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Investment until such Guarantee is funded (in whole or in part). The amount of
any Investment outstanding at any time shall be the original cost of such
Investment, reduced (at the Company's option) by any dividend, distribution,
interest payment, return of capital, repayment or other amount or value received
in respect of such Investment; provided, that to the extent that the amount of
Restricted Payments outstanding at any time is so reduced by any portion of any
such amount or value that would otherwise be included in the calculation of
Consolidated Net Income, such portion of such amount or value shall not be so
included for purposes of calculating the amount of Restricted Payments that may
be made pursuant to paragraph (a) of Section 4.08.
"Investors" means CDR Fund V.
"Issue Date" means the first date on which Notes are issued.
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).
"Management Advances" means (1) loans or advances made to directors,
officers or employees of Holding, the Company or any Restricted Subsidiary (x)
in respect of travel, entertainment or moving-related expenses incurred in the
ordinary course of business, (y) in respect of moving-related expenses incurred
in connection with any closing or consolidation of any facility, or (z) in the
ordinary course of business and (in the case of this clause (z)) not exceeding
$2.5 million in the aggregate outstanding at any time, (2) promissory notes of
Management Investors acquired in connection with the issuance of Management
Stock to such Management Investors, (3) loans to Management Investors of funds
applied to purchase Management Stock in an aggregate principal amount not
exceeding $10.0 million outstanding at any time (less the aggregate principal
amount of then outstanding borrowings by Management Investors then guaranteed by
the Company pursuant to clause (x) of the definition of Management Guarantees),
(4) Management Guarantees, or (5) other Guarantees of borrowings by Management
Investors in connection with the purchase of Management Stock, which Guarantees
are permitted under Section 4.06.
"Management Agreements" means, collectively, the Consulting
Agreement, dated as of March 30, 1998, among Holding, the Company and CDR (and,
in each case, its respective permitted successors and assigns thereunder) and
the Indemnification Agreement, dated as of March 30, 1998, among Holding, the
Company, CDR and the Investors (and, in each case, its respective permitted
successors and assigns thereunder) as each may be amended, supplemented, waived
or otherwise modified from time to time in accordance with the terms thereof and
of this Indenture.
"Management Guarantees" means guarantees (x) of up to an aggregate
principal amount of $10.0 million of borrowings by Management Investors in
connection with their purchase of Management Stock outstanding at any time (less
the aggregate principal amount of then outstanding loans made to Management
Investors by the Company pursuant to clause (3) of the definition of Management
Advances) or (y) made on behalf of, or in respect of loans or advances made to,
directors, officers or employees of Holding, the Company or any Restricted
Subsidiary (1) in respect of travel, entertainment and moving-related expenses
incurred in the
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ordinary course of business, or (2) in the ordinary course of business and (in
the case of this clause (2)) not exceeding $2.5 million in the aggregate
outstanding at any time.
"Management Investors" means the officers, directors, employees and
other members of the management of Holding, the Company or any of their
respective Subsidiaries (or of any Agent), or family members or relatives
thereof, or trusts or partnerships for the benefit of any of the foregoing, or
any of their heirs, executors, successors and legal representatives, or any
Agent, who at any date beneficially own or have the right to acquire, directly
or indirectly, Capital Stock of the Company or Holding.
"Management Stock" means Capital Stock of the Company or Holding
(including any options, warrants or other rights in respect thereof) held by any
of the Management Investors.
"Moody's" means Moody's Investors Service, Inc., and its successors.
"Net Available Cash" from an Asset Disposition means cash payments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise, but only as
and when received, but excluding any other consideration received in the form of
assumption by the acquiring person of Indebtedness or other obligations relating
to the properties or assets that are the subject of such Asset Disposition or
received in any other non-cash form) therefrom, in each case net of (i) all
legal, title and recording tax expenses, commissions and other fees and expenses
incurred, and all Federal, state, provincial, foreign and local taxes required
to be paid or accrued as a liability under GAAP, as a consequence of such Asset
Disposition (including as a consequence of any transfer of funds in connection
with the application thereof in accordance with Section 4.10), (ii) all payments
made, and all installment payments required to be made, on any Indebtedness that
is secured by any assets subject to such Asset Disposition, in accordance with
the terms of any Lien upon such assets, or that must by its terms, or in order
to obtain a necessary consent to such Asset Disposition, or by applicable law,
be repaid out of the proceeds from such Asset Disposition, (iii) all
distributions and other payments required to be made to minority interest
holders in Subsidiaries or joint ventures as a result of such Asset Disposition,
or to any other Person (other than the Company or a Restricted Subsidiary)
owning a beneficial interest in the assets disposed of in such Asset Disposition
and (iv) any liabilities or obligations associated with the assets disposed of
in such Asset Disposition and retained by the Company or any Restricted
Subsidiary after such Asset Disposition, including without limitation pension
and other post-employment benefit liabilities, liabilities related to
environmental matters, and liabilities relating to any indemnification
obligations associated with such Asset Disposition.
"Net Cash Proceeds," with respect to any issuance or sale of any
securities of the Company or any Subsidiary by the Company or any Subsidiary, or
any capital contribution, means the cash proceeds of such issuance, sale or
contribution net of attorneys' fees, accountants' fees, underwriters' or
placement agents' fees, discounts or commissions and brokerage, consultant and
other fees actually incurred in connection with such issuance, sale or
contribution and net of taxes paid or payable as a result thereof.
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"Non-U.S. Person" means a Person who is not a U.S. person, as
defined in Regulation S.
"Note Guarantee" means any of (i) the guarantees of the Notes by the
Domestic Subsidiaries party to this Indenture entered into on the date hereof,
and (ii) any guarantee that may from time to time be entered into by a
Restricted Subsidiary of the Company pursuant to Section 4.13.
"Note Guarantor" means any of (i) Fleet Insurance Management, Inc.,
an Indiana corporation, FrontRunner Worldwide, Inc., a Delaware corporation,
NACAL, Inc., a California corporation, NAVTRANS International Freight
Forwarding, Inc., an Indiana corporation, North American Distribution Systems,
Inc., an Indiana corporation, North American Logistics, Ltd., an Indiana
corporation, North American Van Lines of Texas, Inc., a Texas corporation,
Relocation Management Systems, Inc., a Delaware corporation, Great Falls North
American, Inc., a Montana corporation, Vanguard Insurance Agency, Inc., an
Illinois corporation, Allied Freight Forwarding, Inc., a Delaware corporation, A
Relocation Solutions Management Company, a Delaware corporation, Allied
International, N.A., Inc., a Delaware corporation, Allied Van Lines, Inc., a
Delaware corporation, and Allied Van Lines Terminal Company, a Delaware
corporation, or (ii) any other Restricted Subsidiary of the Company that enters
into a Note Guarantee.
"Notes" means the Initial Notes, any Additional Notes, and the
Exchange Notes.
"Officer" means, with respect to the Company or any other obligor
upon the Notes, the Chairman of the Board, the President, the Chief Executive
Officer, the Chief Financial Officer, any Vice President, the Controller, the
Treasurer or the Secretary (a) of such Person or (b) if such Person is owned or
managed by a single entity, of such entity (or any other individual designated
as an "Officer" for the purposes of this Indenture by the Board of Directors).
"Officer's Certificate" means, with respect to the Company or any
other obligor upon the Notes, a certificate signed by one Officer of such
Person.
"Opinion of Counsel" means a written opinion from legal counsel who
is reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"Original Notes" means the Initial Notes and any Exchange Notes
issued in exchange therefor.
"Outstanding" when used with respect to Notes means, as of the date
of determination, all Notes theretofore authenticated and delivered under this
Indenture, except:
(i) Notes theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Notes for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
in trust for the Holders of such Notes, provided that, if such Notes are
to be redeemed, notice of such
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redemption has been duly given pursuant to this Indenture or provision
therefor reasonably satisfactory to the Trustee has been made; and
(iii) Notes in exchange for or in lieu of which other Notes have
been authenticated and delivered pursuant to this Indenture.
A Note does not cease to be Outstanding because the Company or any
Affiliate of the Company holds the Note, provided that in determining whether
the Holders of the requisite amount of Outstanding Notes have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Notes
owned by the Company or any Affiliate of the Company shall be disregarded and
deemed not to be Outstanding, except that, for the purpose of determining
whether the Trustee shall be protected in relying on any such request, demand,
authorization, direction, notice, consent or waiver, only Notes which the
Trustee actually knows are so owned shall be so disregarded. Notes so owned that
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the reasonable satisfaction of the Trustee the pledgee's right to
act with respect to such Notes and that the pledgee is not the Company or an
Affiliate of the Company.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Notes on behalf of the
Company.
"Permitted Holder" means any of the following: (i) any of the
Investors, Management Investors, CDR and their respective Affiliates; (ii) any
investment fund or vehicle managed, sponsored or advised by CDR; and (iii) any
Person acting in the capacity of an underwriter in connection with a public or
private offering of Capital Stock of Holding or the Company.
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in, or consisting of, any of the following:
(i) a Restricted Subsidiary, the Company, or a Person that will,
upon the making of such Investment, become a Restricted Subsidiary;
(ii) another Person if as a result of such Investment such other
Person is merged or consolidated with or into, or transfers or conveys all
or substantially all its assets to, or is liquidated into, the Company or
a Restricted Subsidiary;
(iii) Temporary Cash Investments or Cash Equivalents;
(iv) receivables owing to the Company or any Restricted Subsidiary,
if created or acquired in the ordinary course of business;
(v) any securities or other Investments received as consideration
in, or retained in connection with, sales or other dispositions of
property or assets, including Asset Dispositions made in compliance with
Section 4.10;
(vi) securities or other Investments received in settlement of debts
created in the ordinary course of business and owing to the Company or any
Restricted Subsidiary,
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or as a result of foreclosure, perfection or enforcement of any Lien, or
in satisfaction of judgments, including in connection with any bankruptcy
proceeding or other reorganization of another Person;
(vii) Investments in existence or made pursuant to legally binding
written commitments in existence on the Issue Date;
(viii) Currency Agreements, Interest Rate Agreements and related
Hedging Obligations, which obligations are Incurred in compliance with
Section 4.06;
(ix) pledges or deposits (x) with respect to leases or utilities
provided to third parties in the ordinary course of business or (y)
otherwise described in the definition of "Permitted Liens" or made in
connection with Liens permitted under Section 4.12;
(x) Investments in joint ventures or similar entities that are not
Restricted Subsidiaries, or in any Related Business, in an aggregate
amount outstanding at any time not to exceed the greater of (x) $15.0
million and (y) 2.5% of Consolidated Tangible Assets;
(xi) (1) Investments in any Receivables Subsidiary, or in connection
with a Financing Disposition by or to any Receivables Entity, including
Investments of funds held in accounts permitted or required by the
arrangements governing such Financing Disposition or any related
Indebtedness, or (2) any promissory note issued by the Company or Holding,
provided that if Holding receives cash from the relevant Receivables
Entity in exchange for such note, an equal cash amount is contributed by
Holding to the Company;
(xii) bonds secured by assets leased to and operated by the Company
or any Restricted Subsidiary that were issued in connection with the
financing of such assets so long as the Company or any Restricted
Subsidiary may obtain title to such assets at any time by paying a nominal
fee, canceling such bonds and terminating the transaction;
(xiii) Notes;
(xiv) any Investment to the extent made using Capital Stock of the
Company (other than Disqualified Stock), or Capital Stock of Holding, as
consideration;
(xv) Management Advances and payments in respect thereof;
(xvi) Agent Guarantees in an aggregate principal amount not
exceeding $10.0 million outstanding at any time and payments in respect
thereof; and
(xvii) other Investments in an aggregate amount outstanding at any
time not to exceed $10.0 million.
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"Permitted Junior Securities" means:
(a) debt securities of the Company as reorganized or readjusted, if
applicable, and guaranteed by the Note Guarantors, or debt securities of the
Company (or any other company, trust or organization provided for by a plan of
reorganization or readjustment succeeding to the assets and liabilities of the
Company) and guaranteed by the Note Guarantors, in each of the foregoing cases,
which securities and guarantees are subordinated, to at least the same extent as
the Notes and the Note Guarantees, to the payment of all Senior Indebtedness and
guarantees thereof that will be outstanding after giving effect to such
reorganization or readjustment, if applicable, so long as (i) such debt
securities are not entitled to the benefit of covenants or defaults more
beneficial to the holders of such debt securities than those in effect with
respect to the Notes (or the Senior Indebtedness, after giving effect to such
reorganization or readjustment, if applicable) and (ii) such debt securities
shall not provide for amortization--including sinking fund and mandatory
prepayment provisions (other than a mandatory prepayment of the type described
in Section 4.14)--commencing prior to the date which is one year after the final
scheduled maturity date of the Senior Indebtedness (as modified by such
reorganization or readjustment, if applicable), or
(b) Capital Stock in the Company or any Note Guarantor;
provided, that in each case with respect to clauses (a) and (b)
above, if a new corporation results from any such reorganization or
readjustment, such corporation assumes all Senior Indebtedness that will be
outstanding after giving effect thereto and provided further, that the rights of
the holders of Senior Indebtedness are not impaired.
"Permitted Liens" means:
(a) Liens for taxes, assessments or other governmental charges not
yet delinquent or the nonpayment of which in the aggregate would not reasonably
be expected to have a material adverse effect on the Company and its Restricted
Subsidiaries, or that are being contested in good faith and by appropriate
proceedings if adequate reserves with respect thereto are maintained on the
books of the Company or a Subsidiary thereof, as the case may be, in accordance
with GAAP;
(b) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other like Liens arising in the ordinary course of
business in respect of obligations that are not overdue for a period of more
than 60 days, or that are bonded or that are being contested in good faith and
by appropriate proceedings;
(c) pledges, deposits or Liens in connection with workers'
compensation, unemployment insurance and other social security and other similar
legislation or other insurance-related obligations (including, without
limitation, pledges or deposits securing liability to insurance carriers under
insurance or self-insurance arrangements);
(d) pledges, deposits or Liens to secure the performance of bids,
tenders, trade, government or other contracts (other than for borrowed money),
obligations for utilities, leases, licenses, statutory obligations, completion
guarantees, surety, judgment, appeal or
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performance bonds, other similar bonds, instruments or obligations, and other
obligations of a like nature incurred in the ordinary course of business;
(e) easements (including reciprocal easement agreements),
rights-of-way, building, zoning and similar restrictions, utility agreements,
covenants, reservations, restrictions, encroachments, changes, and other similar
encumbrances or title defects incurred, or leases or subleases granted to
others, in the ordinary course of business, which do not in the aggregate
materially interfere with the ordinary conduct of the business of the Company
and its Subsidiaries, taken as a whole;
(f) Liens existing on, or provided for under written arrangements
existing on, the Issue Date, or (in the case of any such Liens securing
Indebtedness of the Company or any of its Subsidiaries existing or arising under
written arrangements existing on the Issue Date) securing any Refinancing
Indebtedness in respect of such Indebtedness so long as the Lien securing such
Refinancing Indebtedness is limited to all or part of the same property or
assets (plus improvements, accessions, proceeds or dividends or distributions in
respect thereof) that secured (or under such written arrangements could secure)
the original Indebtedness;
(g) (i) mortgages, liens, security interests, restrictions,
encumbrances or any other matters of record that have been placed by any
developer, landlord or other third party on property over which the Company or
any Restricted Subsidiary of the Company has easement rights or on any leased
property and subordination or similar agreements relating thereto and (ii) any
condemnation or eminent domain proceedings affecting any real property;
(h) Liens securing Hedging Obligations, Purchase Money Obligations
or Capitalized Lease Obligations Incurred in compliance with Section 4.06;
(i) Liens arising out of judgments, decrees, orders or awards in
respect of which the Company shall in good faith be prosecuting an appeal or
proceedings for review, which appeal or proceedings shall not have been finally
terminated, or if the period within which such appeal or proceedings may be
initiated shall not have expired;
(j) leases, subleases, licenses or sublicenses to third parties;
(k) Liens securing (1) Indebtedness Incurred in compliance with
clause (b)(i), (b)(iv), (b)(v), (b)(vii) or (b)(viii)(F) of Section 4.06, (2)
Bank Indebtedness, (3) commercial bank Indebtedness, (4) the Notes or (5)
Indebtedness or other obligations of any Receivables Entity;
(l) Liens existing on property or assets of a Person at the time
such Person becomes a Subsidiary of the Company (or at the time the Company or a
Restricted Subsidiary acquires such property or assets); provided, however, that
such Liens are not created in connection with, or in contemplation of, such
other Person becoming such a Subsidiary (or such acquisition of such property or
assets), and that such Liens are limited to all or part of same property or
assets (plus improvements, accessions, proceeds or dividends or distributions in
respect thereof) that secured (or, under the written arrangements under which
such Liens arose, could secure) the obligations to which such Liens relate;
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(m) Liens on Capital Stock or other securities of an Unrestricted
Subsidiary that secure Indebtedness or other obligations of such Unrestricted
Subsidiary;
(n) any encumbrance or restriction (including, but not limited to,
put and call agreements) with respect to Capital Stock of any joint venture or
similar arrangement pursuant to any joint venture or similar agreement; and
(o) Liens securing Refinancing Indebtedness Incurred in respect of
any Indebtedness secured by, or securing any refinancing, refunding, extension,
renewal or replacement (in whole or in part) of any other obligation secured by,
any other Permitted Liens, provided that any such new Lien is limited to all or
part of the same property or assets (plus improvements, accessions, proceeds or
dividends or distributions in respect thereof) that secured (or, under the
written arrangements under which the original Lien arose, could secure) the
obligations to which such Liens relate.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, limited liability company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Place of Payment" means a city or any political subdivision thereof
referred to in Article 3 and initially designated under Section 4.02.
"Predecessor Notes" of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 3.06 in lieu of a mutilated,
destroyed, lost or stolen Note shall be deemed to evidence the same debt as the
mutilated, destroyed, lost or stolen Note.
"Preferred Stock" as applied to the Capital Stock of any corporation
means Capital Stock of any class or classes (however designated) that by its
terms is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Purchase Money Obligations" means any Indebtedness Incurred to
finance or refinance the acquisition, leasing, construction or improvement of
property (real or personal) or assets, and whether acquired through the direct
acquisition of such property or assets or the acquisition of the Capital Stock
of any Person owning such property or assets, or otherwise.
"QIB" or "Qualified Institutional Buyer" means a "qualified
institutional buyer," as that term is defined in Rule 144A under the Securities
Act.
"Qualified Proceeds" means property or assets that are used, usable
or useful in, or a majority of the Voting Stock of any Person engaged in, a
Related Business; provided that the fair market value of any such assets or
Capital Stock shall be determined by the Board of Directors in good faith.
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"Receivable" means a right to receive payment arising from a sale or
lease of goods or services by a Person pursuant to an arrangement with another
Person pursuant to which such other Person is obligated to pay for goods or
services under terms that permit the purchase of such goods and services on
credit, as determined in accordance with GAAP.
"Receivables Entity" means (x) any Receivables Subsidiary or (y) any
other Person that is engaged in the business of acquiring, selling, collecting,
financing or refinancing Receivables, accounts (as defined in the Uniform
Commercial Code as in effect in any jurisdiction from time to time), other
accounts and/or other receivables, and/or related assets.
"Receivables Fees" means distributions or payments made directly or
by means of discounts with respect to any participation interest issued or sold
in connection with, and other fees paid to a Person that is not a Restricted
Subsidiary in connection with, any Receivables Financing.
"Receivables Financing" means any financing of Receivables of the
Company or any Restricted Subsidiary that have been transferred to a Receivables
Entity in a Financing Disposition.
"Receivables Repurchase Obligation" means any obligation of a seller
of receivables to repurchase receivables (including Receivables, accounts (as
defined in the Uniform Commercial Code as in effect in any jurisdiction from
time to time) and other accounts and receivables (including any thereof
constituting or evidenced by chattel paper, instruments or general intangibles))
arising as a result of a breach of a representation, warranty or covenant or
otherwise, including as a result of a receivable or portion thereof becoming
subject to any asserted defense, dispute, off-set or counterclaim of any kind as
a result of any action taken by, any failure to take action by or any other
event relating to the seller.
"Receivables Subsidiary" means a Subsidiary of the Company that (a)
is engaged solely in the business of acquiring, selling, collecting, financing
or refinancing Receivables, accounts (as defined in the Uniform Commercial Code
as in effect in any jurisdiction from time to time) and other accounts and
receivables (including any thereof constituting or evidenced by chattel paper,
instruments or general intangibles), all proceeds thereof and all rights
(contractual and other), collateral and other assets relating thereto, and any
business or activities incidental or related to such business, and (b) is
designated as a "Receivables Subsidiary" by the Board of Directors.
"Redemption Date" when used with respect to any Note to be redeemed
or purchased means the date fixed for such redemption or purchase by or pursuant
to this Indenture and the Notes.
"Redemption Price" when used with respect to any Note to be redeemed
or purchased means the price at which it is to be redeemed or purchased pursuant
to this Indenture and the Notes.
"refinance" means refinance, refund, replace, renew, repay, modify,
restate, defer, substitute, supplement, reissue, resell or extend (including
pursuant to any defeasance or
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discharge mechanism); and the terms "refinances," "refinanced" and "refinancing"
as used for any purpose in this Indenture shall have a correlative meaning.
"Refinancing Indebtedness" means Indebtedness that is Incurred to
refinance any Indebtedness existing on the date of this Indenture or Incurred in
compliance with this Indenture (including Indebtedness of the Company that
refinances Indebtedness of any Restricted Subsidiary (to the extent permitted in
this Indenture) and Indebtedness of any Restricted Subsidiary that refinances
Indebtedness of another Restricted Subsidiary) including Indebtedness that
refinances Refinancing Indebtedness; provided, that (1) if the Indebtedness
being refinanced is Subordinated Obligations or Guarantor Subordinated
Obligations, the Refinancing Indebtedness has an Average Life at the time such
Refinancing Indebtedness is Incurred that is equal to or greater than the
Average Life of the Indebtedness being refinanced, (2) such Refinancing
Indebtedness is Incurred in an aggregate principal amount (or if issued with
original issue discount, an aggregate issue price) that is equal to or less than
the sum of (x) the aggregate principal amount (or if issued with original issue
discount, the aggregate accreted value) then outstanding of the Indebtedness
being refinanced, plus (y) fees, underwriting discounts, premiums and other
costs and expenses incurred in connection with such Refinancing Indebtedness and
(3) Refinancing Indebtedness shall not include (x) Indebtedness of a Restricted
Subsidiary that is not a Note Guarantor that refinances Indebtedness of the
Company or a Note Guarantor that was incurred by the Company or a Note Guarantor
pursuant to paragraph (a) of Section 4.06 or (y) Indebtedness of the Company or
a Restricted Subsidiary that refinances Indebtedness of an Unrestricted
Subsidiary.
"Regular Record Date" for the interest payable on any Interest
Payment Date means the date specified for that purpose in Section 3.01.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Certificate" means a certificate substantially in the
form attached hereto as Exhibit C.
"Related Business" means those businesses in which the Company or
any of its Subsidiaries is engaged on the date of this Indenture, or that are
related, complementary, incidental or ancillary thereto or extensions,
developments or expansions thereof.
"Related Taxes" means (x) any taxes, charges or assessments,
including but not limited to sales, use, transfer, rental, ad valorem,
value-added, stamp, property, consumption, franchise, license, capital, net
worth, gross receipts, excise, occupancy, intangibles or similar taxes, charges
or assessments (other than federal, state or local taxes measured by income and
federal, state or local withholding imposed on payments made by Holding),
required to be paid by Holding by virtue of its being incorporated or having
Capital Stock outstanding (but not by virtue of owning stock or other equity
interests of any corporation or other entity other than the Company or any of
its Subsidiaries), or being a holding company parent of the Company or receiving
dividends from or other distributions in respect of the Capital Stock of the
Company, or having guaranteed any obligations of the Company or any Subsidiary
thereof, or having made any payment in respect of any of the items for which the
Company is permitted to make payments to Holding pursuant to Section 4.08, or
(y) any other federal, state, foreign, provincial
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or local taxes measured by income for which Holding is liable up to an amount
not to exceed with respect to such federal taxes the amount of any such taxes
that the Company would have been required to pay on a separate company basis or
on a consolidated basis if the Company had filed a consolidated return on behalf
of an affiliated group (as defined in Section 1504 of the Code, or an analogous
provision of state, local or foreign law) of which it were the common parent, or
with respect to state and local taxes, on a combined basis if the Company had
filed a combined return on behalf of an affiliated group consisting only of the
Company and its Subsidiaries, or (z) any federal, state, foreign, provincial or
local withholding taxes paid by Holding by virtue of any dividend distributions
in respect of the Preferred Stock issued in the Allied Acquisition (other than
any such dividend distributions paid in cash).
"Representative" means the trustee, agent or representative (if any)
for an issue of Senior Indebtedness (with respect to any Senior Indebtedness) or
(b) Guarantor Senior Indebtedness (with respect to any Guarantor Senior
Indebtedness).
"Resale Restriction Termination Date" means, with respect to any
Note, the date that is two years (or such other period as may hereafter be
provided under Rule 144(k) under the Securities Act or any successor provision
thereto as permitting the resale by non-affiliates of Restricted Securities
without restriction) after the later of the original issue date in respect of
such Note and the last date on which the Company or any Affiliate of the Company
was the owner of such Note (or any Predecessor Note thereto).
"Restricted Payment Transaction" means any Restricted Payment
permitted pursuant to Section 4.08, any Permitted Payment, any Permitted
Investment, or any transaction specifically excluded from the definition of the
term "Restricted Payment."
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act; provided, however, that the Trustee shall be
entitled to receive, at its request, and conclusively rely on an Opinion of
Counsel with respect to whether any Note constitutes a Restricted Security.
"Restricted Subsidiary" means any Subsidiary of the Company other
than an Unrestricted Subsidiary.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of the Company secured
by a Lien.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Credit Agreement" means the credit agreement dated as of
November 19, 1999, among the Company, any Subsidiaries of the Company party
thereto from time to time, the banks and other financial institutions party
thereto from time to time, Banc of America Securities LLC, as syndication agent,
and The Chase Manhattan Bank as collateral agent and administrative agent, as
such agreement may be assumed by any successor in interest, and as such
agreement may be amended, supplemented, waived or otherwise modified from time
to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time
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(whether in whole or in part, whether with the original agent and lenders or
other agents and lenders or otherwise, and whether provided under the original
Senior Credit Agreement or otherwise).
"Senior Credit Facility" means the collective reference to the
Senior Credit Agreement, any Loan Documents (as defined therein), any notes and
letters of credit issued pursuant thereto and any guarantee and collateral
agreement, patent and trademark security agreement, mortgages, letter of credit
applications and other guarantees, pledge agreements, security agreements and
collateral documents, and other instruments and documents, executed and
delivered pursuant to or in connection with any of the foregoing, in each case
as the same may be amended, supplemented, waived or otherwise modified from time
to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time (whether in whole or in part, whether
with the original agent and lenders or other agents and lenders or otherwise,
and whether provided under the original Senior Credit Agreement or one or more
other credit agreements, indentures (including this Indenture) or financing
agreements or otherwise). Without limiting the generality of the foregoing, the
term "Senior Credit Facility" shall include any agreement (i) changing the
maturity of any Indebtedness incurred thereunder or contemplated thereby, (ii)
adding Subsidiaries of the Company as additional borrowers or guarantors
thereunder, (iii) increasing the amount of Indebtedness incurred thereunder or
available to be borrowed thereunder or (iv) otherwise altering the terms and
conditions thereof.
"Senior Indebtedness" means, with respect to the Company, the
following obligations, whether outstanding on the date hereof or hereafter
issued, without duplication: (i) all Bank Indebtedness, (ii) all obligations in
respect of any Receivables Financing, and (iii) all obligations consisting of
the principal of and premium, if any, and accrued and unpaid interest (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company regardless of whether post-filing
interest is allowed in such proceeding) on, and fees and other amounts owing in
respect of, all other Indebtedness of the Company, unless, in the instrument
creating or evidencing the same or pursuant to which the same is outstanding, it
is expressly provided that the obligations in respect of such Indebtedness are
not senior in right of payment to the Notes; provided, however, that Senior
Indebtedness shall not include (1) any obligation of the Company to any
Subsidiary, (2) any liability for Federal, state, foreign, local or other taxes
owed or owing by the Company, (3) any accounts payable or other liability to
trade creditors arising in the ordinary course of business (including Guarantees
thereof or instruments evidencing such liabilities), (4) any Indebtedness of the
Company (or Guarantee by the Company of any Indebtedness) that is expressly
subordinated in right of payment to any other Indebtedness of the Company (or
Guarantee by the Company of any Indebtedness), (5) any Capital Stock of the
Company or (6) that portion of any Indebtedness of the Company that is Incurred
by the Company in violation of Section 4.06 (but no such violation shall be
deemed to exist for purposes of this clause (6) if any holder of such
Indebtedness or such holder's representative shall have received an Officer's
Certificate of the Company to the effect that such Incurrence of such
Indebtedness does not (or that the Incurrence by the Company of the entire
committed amount thereof at the date on which the initial borrowing thereunder
is made would not) violate Section 4.06). If any Senior Indebtedness is
disallowed, avoided or subordinated pursuant to the provisions of Section 548 of
Title 11 of the United States Code or any applicable state fraudulent conveyance
law, such Senior Indebtedness nevertheless will constitute Senior Indebtedness.
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"Senior Subordinated Indebtedness" means the Notes and any other
Indebtedness of the Company that ranks pari passu with the Notes.
"Significant Subsidiary" means any Restricted Subsidiary that would
be a "significant subsidiary" of the Company within the meaning of Rule 1-02
under Regulation S-X promulgated by the SEC, as in effect on the Issue Date.
"Special Record Date" for the payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 3.07.
"S&P" means Standard & Poor's Ratings Service, a division of The
McGraw-Hill Companies, Inc., and its successors.
"Standard Receivable Obligations" means representations, warranties,
covenants, indemnities and other obligations (including Guarantees and
Indebtedness) that are reasonably customary in connection with a Financing
Disposition (as determined by the Company in good faith), including, without
limitation, those relating to the servicing of the assets of a Receivables
Entity, it being understood that any Receivables Repurchase Obligation shall be
deemed to be a Standard Receivable Obligation.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing for the repurchase
of such security at the option of the holder thereof upon the happening of any
contingency).
"Subordinated Obligations" means any Indebtedness of the Company
(whether outstanding on the date of this Indenture or thereafter Incurred) that
is expressly subordinated in right of payment to the Notes pursuant to a written
agreement.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital Stock or other equity interests (including
partnership interests) entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time owned or controlled, directly or indirectly, by (i) such Person
or (ii) one or more Subsidiaries of such Person.
"Tax Sharing Agreement" means the Tax Sharing Agreement, dated as of
the Issue Date, between the Company and Holding, as the same may be amended,
supplemented, waived or otherwise modified from time to time in accordance with
the terms thereof and of this Indenture.
"Temporary Cash Investments" means any of the following: (i) any
investment in (x) direct obligations of the United States of America or any
agency or instrumentality thereof or obligations Guaranteed by the United States
of America or any agency or instrumentality thereof, or (y) direct obligations
of any foreign country recognized by the United States of America rated at least
"A" by S&P or "A-1" by Moody's (or, in either case, the equivalent of such
rating by such organization or, if no rating of S&P or Moody's then exists, the
equivalent of such rating by
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any nationally recognized rating organization), (ii) overnight bank deposits,
and investments in time deposit accounts, certificates of deposit, bankers'
acceptances and money market deposits (or, with respect to foreign banks,
similar instruments) maturing not more than one year after the date of
acquisition thereof issued by (x) any lender under the Senior Credit Agreement
or (y) a bank or trust company that is organized under the laws of the United
States of America, any state thereof or any foreign country recognized by the
United States of America having capital and surplus aggregating in excess of
$250 million (or the foreign currency equivalent thereof) and whose long term
debt is rated at least "A" by S&P or "A-1" by Moody's (or, in either case, the
equivalent of such rating by such organization or, if no rating of S&P or
Moody's then exists, the equivalent of such rating by any nationally recognized
rating organization) at the time such Investment is made, (iii) repurchase
obligations with a term of not more than 30 days for underlying securities of
the types described in clause (i) or (ii) above entered into with a bank meeting
the qualifications described in clause (ii) above, (iv) investments in
commercial paper, maturing not more than 270 days after the date of acquisition,
issued by a Person (other than the Company or any of its Subsidiaries), with a
rating at the time as of which any Investment therein is made of "P-2" (or
higher) according to Moody's or "A-2" (or higher) according to S&P (or, in
either case, the equivalent of such rating by such organization or, if no rating
of S&P or Moody's then exists, the equivalent of such rating by any nationally
recognized rating organization), (v) Investments in securities maturing not more
than one year after the date of acquisition issued or fully guaranteed by any
state, commonwealth or territory of the United States of America, or by any
political subdivision or taxing authority thereof, and rated at least "A" by S&P
or "A" by Moody's (or, in either case, the equivalent of such rating by such
organization or, if no rating of S&P or Moody's then exists, the equivalent of
such rating by any nationally recognized rating organization), (vi) investment
funds investing 95% of their assets in securities of the type described in
clauses (i)-(v) above (which funds may also hold reasonable amounts of cash
pending investment and/or distribution, (vii) any money market deposit accounts
issued or offered by a domestic commercial bank or a commercial bank organized
and located in a country recognized by the United States of America, in each
case, having capital and surplus in excess of $250 million (or the foreign
currency equivalent thereof), or investments in money market funds complying
with the risk limiting conditions of Rule 2a-7 (or any successor rule) of the
SEC under the Investment Company Act of 1940, as amended, or (viii) similar
short-term investments approved by the Board of Directors in the ordinary course
of business.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-7bbbb) as in effect on the date of this Indenture.
"Trade Payables" means, with respect to any Person, any accounts
payable or any indebtedness or monetary obligation to trade creditors created,
assumed or guaranteed by such Person arising in the ordinary course of business
in connection with the acquisition of goods or services.
"Transactions" means, collectively, the Allied Acquisition, the
offering and issuance of the Notes and the Holding Notes, the initial borrowings
under the Senior Credit Facility, the issuance by Holding of Capital Stock as
part of the consideration for the Allied Acquisition, the Holding Stock Issuance
and all other related transactions
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"Treasury Rate" means, with respect to a Redemption Date, the yield
to maturity at the time of computation of United States Treasury securities with
a constant maturity (as compiled and published in the most recent Federal
Reserve Statistical Release H.15(519) that has become publicly available at
least two Business Days prior to such Redemption Date (or, if such Statistical
Release is no longer published, any publicly available source or similar market
data)) most nearly equal to the period from such Redemption Date to May 15,
2003; provided, however, that if the period from such Redemption Date to May 15,
2003 is not equal to the constant maturity of the United States Treasury
security for which a weekly average yield is given, the Treasury Rate shall be
obtained by linear interpolation (calculated to the nearest one-twelfth of a
year) from the weekly average yields of United States securities for which such
yields are given, except that if the period from such Redemption Date to May 15,
2003 is less than one year, the weekly average yield on actually traded United
States Treasury securities adjusted to a constant maturity of one year shall be
used.
"Trust Officer" means any officer of the Trustee assigned by the
Trustee to administer its corporate trust matters.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company
that at the time of determination is an Unrestricted Subsidiary, as designated
by the Board of Directors in the manner provided below, and (ii) any Subsidiary
of an Unrestricted Subsidiary. The Board of Directors may designate any
Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary of the Company) to be an Unrestricted Subsidiary unless such
Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of,
or owns or holds any Lien on any property of, the Company or any other
Restricted Subsidiary of the Company that is not a Subsidiary of the Subsidiary
to be so designated; provided, that either (A) the Subsidiary to be so
designated has total consolidated assets of $1,000 or less or (B) if such
Subsidiary has consolidated assets greater than $1,000, then such designation
would be permitted under Section 4.08. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided, that
immediately after giving effect to such designation either (x) the Company could
incur at least $1.00 of additional Indebtedness under paragraph (a) of Section
4.06 or (y) the Consolidated Coverage Ratio would be greater than it was
immediately prior to giving effect to such designation. Any such designation by
the Board of Directors shall be evidenced to the Trustee by promptly filing with
the Trustee a copy of the resolution of the Company's Board of Directors giving
effect to such designation and an Officer's Certificate of the Company
certifying that such designation complied with the foregoing provisions.
"U.S. Government Obligation" means (x) any security that is (i) a
direct obligation of the United States of America for the payment of which the
full faith and credit of the United States of America is pledged or (ii) an
obligation of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United
States of America, which, in either case under the preceding clause (i) or (ii),
is not callable or redeemable at the option of the issuer thereof, and (y) any
depositary receipt issued by a bank (as defined in
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Section 3(a)(2) of the Securities Act) as custodian with respect to any U.S.
Government Obligation that is specified in clause (x) above and held by such
bank for the account of the holder of such depositary receipt, or with respect
to any specific payment of principal of or interest on any U.S. Government
Obligation that is so specified and held, provided that (except as required by
law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depositary receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment
of principal or interest evidenced by such depositary receipt.
"Vice President" when used with respect to any Person means any vice
president of such Person, whether or not designated by a number or a word or
words added before or after the title "vice president."
"Voting Stock" of an entity means all classes of Capital Stock of
such entity then outstanding and normally entitled to vote in the election of
directors or all interests in such entity with the ability to control the
management or actions of such entity.
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Section 1.02 Other Definitions.
Defined in
Term Section
---- -------
"Act"................................................ 1.08
"Affiliate Transaction".............................. 4.11
"Agent Members"...................................... 3.12
"Amendment".......................................... 4.09
"Authentication Order"............................... 3.03
"Bankruptcy Law"..................................... 6.01
"Blockage Notice".................................... 14.03
"Covenant Defeasance"................................ 12.03
"Custodian".......................................... 6.01
"Defaulted Interest"................................. 3.07
"Defeasance"......................................... 12.02
"Defeased Notes"..................................... 12.01
"Event of Default"................................... 6.01
"Expiration Date".................................... 1.08
"Global Notes"....................................... 2.01
"Guaranteed Obligations"............................. 13.01
"Guarantor Blockage Notice".......................... 15.03
"Guarantor Non-payment Default"...................... 15.03
"Guarantor Payment Blockage Period".................. 15.03
"Guarantor Payment Default".......................... 15.03
"Initial Agreement".................................. 4.09
"Initial Lien"....................................... 4.12
"Non-payment Default"................................ 14.03
"Note Register" and "Note Registrar"................. 3.05
"Offer".............................................. 4.10
"Offshore Global Note"............................... 2.01
"Offshore Note Exchange Date"........................ 3.13
"Offshore Physical Note"............................. 2.01
"pay its Note Guarantee"............................. 15.03
"pay the Notes"...................................... 14.03
"Payment Blockage Period"............................ 14.03
"Payment Default".................................... 14.03
"Permitted Payment".................................. 4.08
"Physical Notes"..................................... 2.01
"Private Placement Legend"........................... 2.03
"Redemption Amount".................................. 10.01
"Refinancing Agreement".............................. 4.09
"Restricted Payment"................................. 4.08
"Sale"............................................... 1.01
"Successor Company".................................. 5.01
"Unitary Global Note"................................ 2.01
"U.S. Global Note"................................... 2.01
"U.S. Physical Notes"................................ 2.01
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Section 1.03 Rules of Construction. For all purposes of this
Indenture, except as otherwise expressly provided or unless the context
otherwise requires:
(1) the terms defined in this Indenture have the meanings assigned
to them in this Indenture;
(2) "or" is not exclusive;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP;
(4) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision;
(5) all references to "$" or "dollars" shall refer to the lawful
currency of the United States of America;
(6) the words "include," "included" and "including" as used herein
shall be deemed in each case to be followed by the phrase "without
limitation," if not expressly followed by such phrase or the phrase "but
not limited to";
(7) words in the singular include the plural, and words in the
plural include the singular; and
(8) any reference to a Section or Article refers to such Section or
Article of this Indenture.
Section 1.04 Incorporation by Reference of TIA. Whenever this
Indenture refers to a provision of the TIA, the provision is incorporated by
reference in and made a part of this Indenture. This Indenture is subject to the
mandatory provisions of the TIA, which are incorporated by reference in and made
a part of this Indenture. Any terms incorporated by reference in this Indenture
that are defined by the TIA, defined by any TIA reference to another statute or
defined by SEC rule under the TIA, have the meanings so assigned to them
therein. The following TIA terms have the following meanings:
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company and any
other obligor on the Notes.
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Section 1.05 Conflict with TIA. If any provision hereof limits,
qualifies or conflicts with a provision of the TIA that is required under the
TIA to be a part of and govern this Indenture, the latter provision shall
control. If any provision of this Indenture modifies or excludes any provision
of the TIA that may be so modified or excluded, the latter provision shall be
deemed (i) to apply to this Indenture as so modified or (ii) to be excluded, as
the case may be.
Section 1.06 Compliance Certificates and Opinions. Upon any
application or request by the Company or by any other obligor upon the Notes
(including any Note Guarantor) to the Trustee to take any action under any
provision of this Indenture, the Company or such other obligor upon the Notes,
as the case may be, shall furnish to the Trustee such certificates and opinions
as may be required under the TIA. Each such certificate or opinion shall be
given in the form of one or more Officer's Certificates, if to be given by an
Officer, or an Opinion of Counsel, if to be given by counsel, and shall comply
with the requirements of the TIA and any other requirements set forth in this
Indenture. Notwithstanding the foregoing, in the case of any such request or
application as to which the furnishing of any Officer's Certificate or Opinion
of Counsel is specifically required by any provision of this Indenture relating
to such particular request or application, no additional certificate or opinion
need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (except for certificates
provided for in Section 4.05) shall include:
(9) a statement that the individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(10) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(11) a statement that, in the opinion of such individual, he or she
made such examination or investigation as is necessary to enable him or
her to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(12) a statement as to whether, in the opinion of such individual,
such condition or covenant has been complied with.
Section 1.07 Form of Documents Delivered to Trustee. In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an Officer may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless such Officer knows that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate or opinion of counsel may
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be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an Officer or Officers to the effect that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.08 Acts of Noteholders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee, and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 7.01) conclusive in favor of the Trustee, the
Company and any other obligor upon the Notes, if made in the manner provided in
this Section 1.08.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of any notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by an officer of a corporation or a member of a partnership or
other entity, on behalf of such corporation or partnership or other entity, such
certificate or affidavit shall also constitute sufficient proof of such Person's
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the person executing the same, may also be proved in any
other manner that the Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Note shall bind the Holder of every
Note issued upon the transfer thereof or in exchange therefor or in lieu
thereof, in respect of anything done or suffered to be done by the Trustee, the
Company or any other obligor upon the Notes in reliance thereon, whether or not
notation of such action is made upon such Note.
(e) (i) The Company may set any day as a record date for the purpose
of determining the Holders of Outstanding Notes entitled to give, make or
take any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Notes, provided that the Company may
not set a record date for, and the provisions of this paragraph shall not
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apply with respect to, the giving or making of any notice, declaration,
request or direction referred to in subclause (e)(ii) of this Section
1.08. If any record date is set pursuant to this paragraph, the Holders of
Outstanding Notes on such record date (or their duly designated proxies),
and no other Holders, shall be entitled to take the relevant action,
whether or not such Persons remain Holders after such record date;
provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite
principal amount of Outstanding Notes on such record date. Nothing in this
paragraph shall be construed to prevent the Company from setting a new
record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no
effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite principal amount
of Outstanding Notes on the date such action is taken. Promptly after any
record date is set pursuant to this paragraph, the Company, at its own
expense, shall cause notice of such record date, the proposed action by
Holders and the applicable Expiration Date to be given to the Trustee in
writing and to each Holder of Notes in the manner set forth in Section
1.10.
(ii) The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Notes entitled to join in the
giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 6.02, (iii) any request to institute
proceedings referred to in Section 6.07(2) or (iv) any direction referred
to in Section 6.12, in each case with respect to Notes. If any record date
is set pursuant to this paragraph, the Holders of Outstanding Notes on
such record date, and no other Holders, shall be entitled to join in such
notice, declaration, request or direction, whether or not such Holders
remain Holders after such record date; provided that no such action shall
be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of
Outstanding Notes on such record date. Nothing in this paragraph shall be
construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically
and with no action by any Person be cancelled and of no effect), and
nothing in this paragraph shall be construed to render ineffective any
action taken by Holders of the requisite principal amount of Outstanding
Notes on the date such action is taken. Promptly after any record date is
set pursuant to this paragraph, the Trustee, at the Company's expense,
shall cause notice of such record date, the proposed action by Holders and
the applicable Expiration Date to be given to the Company in writing and
to each Holder of Notes in the manner set forth in Section 1.10.
(iii) With respect to any record date set pursuant to this Section
1.08, the party hereto that sets such record dates may designate any day
as the "Expiration Date" and from time to time may change the Expiration
Date to any earlier or later day; provided that no such change shall be
effective unless notice of the proposed new Expiration Date is given to
the Company or the Trustee, whichever such party is not setting a record
date pursuant to this Section 1.08(e) in writing, and to each Holder of
Notes in the manner set forth in Section 1.10, on or prior to the existing
Expiration Date. If an Expiration Date is not designated with respect to
any record date set pursuant to this Section, the party
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hereto that set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date
with respect thereto, subject to its right to change the Expiration Date
as provided in this paragraph. Notwithstanding the foregoing, no
Expiration Date shall be later than the 180th day after the applicable
record date.
(iv) Without limiting the foregoing, a Holder entitled hereunder to
take any action hereunder with regard to any particular Note may do so
with regard to all or any part of the principal amount of such Note or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such principal amount.
Section 1.09 Notices, etc., to Trustee and Company. Any request,
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with,
(1) the Trustee by any Holder or by the Company or any other obligor
upon the Notes shall be sufficient for every purpose hereunder if made,
given, furnished or filed in writing to or with the Trustee at State
Street Bank and Trust Company, Corporate Trust Department, 2 Avenue de
Lafayette, 6th Floor, Boston, MA 02111-1724 or at any other address
furnished in writing to the Company by the Trustee, or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder if in writing and mailed, first-class postage
prepaid, to the Company c/o North American Van Lines, Inc., 5001 U.S.
Highway 30 West, P.O. Box 988, Fort Wayne, Indiana 46801-0988, Attention:
Chief Financial Officer (telephone: (219) 429-2511; telecopier: (219)
429-1704), with copies to North American Van Lines, Inc., 5001 U.S.
Highway 30 West, P.O. Box 988, Fort Wayne, Indiana, Attention: General
Counsel (telephone: (219) 429-2511); telecopier: (219) 429-1704) and
Debevoise & Plimpton, 875 Third Avenue, New York, New York 10022,
Attention: David Brittenham, Esq. (telephone: (212) 909-6000; telecopier:
(212) 909-6836), or at any other address previously furnished in writing
to the Trustee by the Company.
Section 1.10 Notices to Holders; Waiver. Where this Indenture
provides for notice to Holders of any event, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event, at such
Holder's address as it appears in the Note Register, not later than the latest
date, and not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
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In case, by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail notice of any event as
required by any provision of this Indenture, then such notification as shall be
made with the approval of the Trustee (such approval not to be unreasonably
withheld) shall constitute a sufficient notification for every purpose
hereunder.
Section 1.11 Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
Section 1.12 Successors and Assigns. All covenants and agreements in
this Indenture by the Company shall bind its respective successors and assigns,
whether so expressed or not.
Section 1.13 Separability Clause. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 1.14 Benefits of Indenture. Nothing in this Indenture or in
the Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, any Paying Agent and the Holders, any
benefit or any legal or equitable right, remedy or claim under this Indenture,
except as provided in Article 14 and Article 15.
Section 1.15 GOVERNING LAW. THIS INDENTURE AND THE NOTES SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT GIVING EFFECT TO ANY PRINCIPLES OF CONFLICT OF LAWS TO THE EXTENT
THAT THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY. THE TRUSTEE, THE COMPANY, ANY OTHER OBLIGOR IN RESPECT OF THE NOTES AND
(BY THEIR ACCEPTANCE OF THE NOTES) THE HOLDERS, AGREE TO SUBMIT TO THE
JURISDICTION OF ANY UNITED STATES FEDERAL OR STATE COURT LOCATED IN THE BOROUGH
OF MANHATTAN, IN THE CITY OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS INDENTURE OR THE NOTES.
Section 1.16 Legal Holidays. In any case where any Interest Payment
Date, Redemption Date or Stated Maturity of any Note shall not be a Business Day
at any Place of Payment, then (notwithstanding any other provision of this
Indenture or of the Notes) payment of interest or principal and premium (if any)
need not be made at such Place of Payment on such date, but may be made on the
next succeeding Business Day at such Place of Payment with the same force and
effect as if made on the Interest Payment Date or Redemption Date, or at the
Stated Maturity.
Section 1.17 No Personal Liability of Directors, Officers,
Employees, Incorporators and Stockholders. No director, officer, employee,
incorporator, member or stockholder, as such, of the Company, any Note Guarantor
or any Subsidiary of any thereof shall have any liability for any obligation of
the Company or any Note Guarantor under this Indenture, the Notes or any Note
Guarantee, or for any claim based on, in respect of, or by reason of, any
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such obligation or its creation. Each Noteholder, by accepting the Notes, waives
and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
Section 1.18 Exhibits and Schedules. All exhibits and schedules
attached hereto are by this reference made a part hereof with the same effect as
if herein set forth in full.
Section 1.19 Counterparts. This Indenture may be executed in any
number of counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.
ARTICLE 2
NOTE FORMS
Section 2.01 Forms Generally. The Notes and the Trustee's
certificate of authentication relating thereto shall be in substantially the
forms set forth, or referenced, in this Article 2 and Exhibit A annexed hereto,
which Exhibit is hereby incorporated in and expressly made a part of this
Indenture. The Notes may have such appropriate insertions, omissions,
substitutions, notations, legends, endorsements, identifications and other
variations as are required or permitted by law, stock exchange rule or
Depository rule or usage, agreements to which the Company is subject, if any, or
other customary usage, or as may consistently herewith be determined by the
Officer or member of the Company executing such Notes, as evidenced by such
execution (provided always that any such notation, legend, endorsement,
identification or variation is in a form acceptable to the Company). Each Note
shall be dated the date of its authentication. The terms of the Notes set forth
in Exhibit A are part of the terms of this Indenture. However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling. Any portion of
the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.
Initial Notes and any Additional Notes offered and sold in reliance
on Rule 144A under the Securities Act shall, unless the Company otherwise
notifies the Trustee in writing, be issued in the form of one or more permanent
global Notes in substantially the form set forth in Exhibit A (each, a "U.S.
Global Note"), deposited with the Trustee, as custodian for the Depositary or
its nominee, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The aggregate principal amount of a U.S. Global Note may
from time to time be increased or decreased by adjustments made on the records
of the Trustee, as custodian for the Depositary or its nominee, as hereinafter
provided.
Initial Notes and any Additional Notes offered and sold in offshore
transactions in reliance on Regulation S under the Securities Act shall be
issued in the form of one or more permanent global Notes in substantially the
form set forth in Exhibit A (each, an "Offshore Global Note"), deposited with
the Trustee, as custodian for the Depositary or its nominee, duly executed by
the Company and authenticated by the Trustee as hereinafter provided. The
aggregate principal amount of an Offshore Global Note, if any, may from time to
time be increased or decreased by adjustments made in the records of the
Trustee, as custodian for the Depositary or its nominee, as hereinafter
provided.
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Subject to the limitations on the issuance of certificated Notes set
forth in Sections 3.12 and 3.13, Initial Notes and any Initial Additional Notes
issued pursuant to Section 3.05 in exchange for or upon transfer of beneficial
interests (x) in a U.S. Global Note shall be in the form of permanent
certificated Notes substantially in the form set forth in Exhibit A and shall
contain the Private Placement Legend as set forth in Section 2.03 (the "U.S.
Physical Notes") or (y) in an Offshore Global Note (if any), on or after the
Offshore Note Exchange Date with respect to such Offshore Global Note, shall be
in the form of permanent certificated Notes substantially in the form set forth
in Exhibit A (the "Offshore Physical Notes"), respectively, as hereinafter
provided.
The Offshore Physical Notes and the U.S. Physical Notes are
sometimes collectively herein referred to as the "Physical Notes." The U.S.
Global Notes and the Offshore Global Notes are sometimes collectively referred
to as the "Global Notes."
Exchange Notes shall be issued substantially in the form set forth
in Exhibit A and, subject to Section 3.12(b), shall be in the form of one or
more Global Notes.
Section 2.02 Form of Trustee's Certificate of Authentication.
This is one of the Notes referred to in the within-mentioned
Indenture.
_______________________,
as Trustee
By____________________
Authorized Officer
Dated:
If an appointment of an Authenticating Agent is made pursuant to
Section 7.14, the Notes may have endorsed thereon, in lieu of the Trustee's
certificate of authentication, an alternative certificate of authentication in
the following form:
This is one of the Notes referred to in the within-mentioned
Indenture.
_______________________
As Trustee
By_____________________
As Authenticating Agent
By_____________________
Authorized Officer
Dated:
Section 2.03 Restrictive and Global Note Legends. Each Global Note
and Physical Note shall bear the following legend set forth below (the "Private
Placement Legend") on the face thereof until the Private Placement Legend is
removed in accordance with Section 3.13(4):
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THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND HAS
NOT BEEN REGISTERED UNDER ANY STATE SECURITIES LAWS, AND THIS NOTE
(AND ANY INTEREST OR PARTICIPATION HEREIN) MAY NOT BE OFFERED, SOLD,
ASSIGNED, PLEDGED, ENCUMBERED OR OTHERWISE TRANSFERRED OR DISPOSED
OF IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE
SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT
(A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT ("RULE 144A")) OR (B) IT IS NOT A U.S.
PERSON AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION AND (2)
AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS NOTE MAY BE
OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED OR DISPOSED OF
ONLY (I) INSIDE THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED STATES IN A
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT,
(III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (IV)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR (V) TO THE COMPANY, IN EACH OF CASES (I) THROUGH (IV) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES, AND SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (X) PURSUANT TO CLAUSE
(II) OR (III) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION
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SATISFACTORY TO EACH OF THEM, AND (Y) IN THE CASE OF ANY OF THE
FOREGOING CLAUSES (I) THROUGH (V), TO REQUIRE THAT A CERTIFICATE OF
TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS
COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE COMPANY AND THE
TRUSTEE, THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTION
REFERRED TO ABOVE. AS USED HEREIN, THE TERMS "UNITED STATES,"
"OFFSHORE TRANSACTION" AND "U.S. PERSON" HAVE THE RESPECTIVE
MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
Each Global Note, whether or not an Initial Note, shall also bear
the following legend on the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC") TO
THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE
WITH THE RESTRICTIONS SET FORTH IN SECTIONS 3.12 AND 3.13 OF THE
INDENTURE.
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ARTICLE 3
THE NOTES
Section 3.01 Title and Terms. The aggregate principal amount of
Notes that may be authenticated and delivered and Oustanding under this
Indenture is limited to $300,000,000, except for Notes authenticated and
delivered upon registration of transfer thereof, or in exchange for, or in lieu
of, other Notes pursuant to Section 3.04, 3.05, 3.06, 3.12(c), 3.12(d),
3.13(1)(c), 9.06 and 10.08. The Initial Notes will be issued in an aggregate
principal amount of $150,000,000. All the Original Notes shall vote and consent
together on all matters as one class, and none of the Original Notes will have
the right to vote or consent as a class separate from one another on any matter.
Additional Notes (including any Exchange Notes issued in exchange therefor) may
vote as a class with the other Notes and otherwise be treated as Notes for
purposes of this Indenture.
The Notes shall be known and designated as the "13 3/8% Senior
Subordinated Notes due 2009" of the Company. The final Stated Maturity of the
Notes shall be December 1, 2009. Interest on the Outstanding principal amount of
Notes will accrue at the rate of 13 3/8% per annum and will be payable
semi-annually in arrears on June 1 and December 1 in each year, commencing on
June 1, 2000, to holders of record on the immediately preceding May 15 and
November 15, respectively (each such May 15 and November 15, a "Regular Record
Date"). Interest on the Original Notes will accrue from the most recent date to
which interest has been paid or duly provided for or, if no interest has been
paid, from the Issue Date; and interest on any Additional Notes (and Exchange
Notes issued in exchange therefor) will accrue from the most recent date to
which interest has been paid or duly provided for or, if no interest has been
paid on such Additional Notes, from the date of issuance of such Additional
Notes; provided, that if any Note is surrendered for exchange on or after a
record date for an Interest Payment Date that will occur on or after the date of
such exchange, interest on the Note received in exchange thereof will accrue
from the date of such Interest Payment Date.
The principal of, and premium, if any, and interest, on the Notes
shall be payable at the office or agency of the Company maintained for that
purpose in the Borough of Manhattan, The City of New York or the corporate trust
office of an affiliate of the Paying Agent in New York City (the "Place of
Payment"); provided, however, that at the option of the Company payment of
interest on a Note may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Note Register, or, if a
Holder has given wire instructions to the Company, by wire transfer to a United
States dollar account maintained by the Holder with a bank located in New York
City.
Section 3.02 Denominations. The Notes shall be issuable only in
registered form without coupons and only in denominations of $1,000 and any
integral multiple thereof.
Section 3.03 Execution, Authentication and Delivery and Dating. The
Notes shall be executed on behalf of the Company by one Officer of the Company.
The signature of such Officer on the Notes may be manual or facsimile.
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Notes bearing the manual or facsimile signatures of individuals who
were at any time the proper Officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Notes executed by the Company to the
Trustee for authentication; and the Trustee shall authenticate and deliver (i)
Initial Notes for original issue in the aggregate principal amount not to exceed
$150,000,000 and (ii) Additional Notes from time to time for original issue in
aggregate principal amount not to exceed $150,000,000 and (iii) Exchange Notes
from time to time for issue in exchange for a like principal amount of Initial
Notes or Initial Additional Notes, in each case specified in clauses (i) through
(iii) above, upon a written order of the Company in the form of an Officer's
Certificate of the Company (an "Authentication Order"). Such Officer's
Certificate shall specify the amount of Notes to be authenticated and the date
on which the Notes are to be authenticated, whether the Notes are to be Initial
Notes, Additional Notes or Exchange Notes and whether the Notes are to be issued
as one or more Global Notes or Physical Notes and such other information as the
Company may include or the Trustee may reasonably request. Any offering of
Additional Notes is subject to Section 4.06.
All Notes shall be dated the date of their authentication.
No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any Note
shall be conclusive evidence, and the only evidence, that such Note has been
duly authenticated and delivered hereunder.
Section 3.04 Temporary Notes. Until definitive Notes are ready for
delivery, the Company may prepare and upon receipt of an Authentication Order
the Trustee shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the
Company considers appropriate for temporary Notes. If temporary Notes are
issued, the Company will cause definitive Notes to be prepared without
unreasonable delay. After the preparation of definitive Notes, the temporary
Notes shall be exchangeable for definitive Notes upon surrender of the temporary
Notes at the office or agency of the Company in a Place of Payment, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Notes, the Company shall execute and upon receipt of an Authentication
Order the Trustee shall authenticate and deliver in exchange therefor a like
principal amount of definitive Notes of authorized denominations. Until so
exchanged the temporary Notes shall in all respects be entitled to the same
benefits under this Indenture as definitive Notes of the same series and tenor.
Section 3.05 Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of the Trustee
a register (the register maintained in such office and in any other office or
agency of the Company in a Place of Payment being herein sometimes collectively
referred to as the "Note Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the
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registration of Notes and of transfers of Notes. The Trustee is hereby appointed
"Note Registrar" for the purpose of registering Notes and transfers of Notes as
herein provided.
Upon surrender for transfer of any Note at the office or agency of
the Company in a Place of Payment, in compliance with all applicable
requirements of this Indenture and applicable law, the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Notes, of any authorized
denominations and of a like aggregate principal amount.
At the option of the Holder, Notes may be exchanged for other Notes,
of any authorized denominations and of a like tenor and aggregate principal
amount, upon surrender of the Notes to be exchanged at such office or agency.
Whenever any Notes are so surrendered for exchange, the Company shall execute,
and the Trustee shall authenticate and deliver, the Notes that the Holder making
the exchange is entitled to receive.
All Notes issued upon any transfer or exchange of Notes shall be the
valid obligations of the Company, evidencing the same debt, and entitled to the
same benefits under this Indenture, as the Notes surrendered upon such transfer
or exchange.
Every Note presented or surrendered for transfer or exchange shall
(if so required by the Company or the Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Note Registrar duly executed, by the Holder thereof or such
Holder's attorney duly authorized in writing.
No service charge shall be made for any transfer or exchange of
Notes, but the Company may require payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection with any transfer
or exchange of Notes under this Section 3.05.
The Company shall not be required (i) to issue, transfer or exchange
any Note during a period beginning at the opening of business 15 days before the
day of the mailing of a notice of redemption (or purchase) of Notes selected for
redemption (or purchase) under Section 10.04 and ending at the close of business
on the day of such mailing, or (ii) to transfer or exchange any Note so selected
for redemption (or purchase) in whole or in part.
Section 3.06 Mutilated, Destroyed, Lost and Stolen Notes. If (i) any
mutilated Note is surrendered to the Trustee, or the Company and the Trustee
receive evidence to their satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Company and the Trustee such security
or indemnity as may be required by them to save each of them harmless, then, in
the absence of notice to the Company or the Trustee that such Note has been
acquired by a bona fide purchaser, the Company shall execute and upon receipt of
an Authentication Order the Trustee shall authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Note, a new Note
of like tenor and principal amount, bearing a number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen Note has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Note, pay such Note.
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Upon the issuance of any new Note under this Section 3.06, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Note issued pursuant to this Section 3.06 in lieu of any
mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and ratably with
any and all other Notes duly issued hereunder.
The provisions of this Section 3.06 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Notes.
Section 3.07 Payment of Interest Rights Preserved. Interest on any
Note that is payable, and is punctually paid or duly provided for, on any
Interest Payment Date shall be paid to the Person in whose name that Note (or
one or more Predecessor Notes) is registered at the close of business on the
Regular Record Date for such interest specified in Section 3.01.
Any interest on any Note that is payable, but is not punctually paid
or duly provided for, on any Interest Payment Date (herein called "Defaulted
Interest") shall forthwith cease to be payable to the registered Holder on the
relevant Regular Record Date by virtue of having been such Holder; and such
Defaulted Interest may be paid by the Company, as provided in clause (1) or
clause (2) below:
(3) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Notes (or their respective Predecessor
Notes) are registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest, which shall be fixed in the
following manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each Note and the date
of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed
to be paid in respect of such Defaulted Interest or shall make
arrangements reasonably satisfactory to the Trustee for such deposit prior
to the date of the proposed payment, such money when deposited to be held
in trust for the benefit of the Persons entitled to such Defaulted
Interest as provided in this clause (1). Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest which shall
be not more than 15 nor less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the
Trustee of the notice of the proposed payment. The Trustee shall promptly
notify the Company of such Special Record Date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed,
first class postage prepaid, to each Holder at such Holder's address as it
appears in the Note Register, not less than 10 days prior to such Special
Record Date. Notice of the proposed payment of such Defaulted Interest and
the Special Record Date therefor having been so mailed, such Defaulted
Interest shall be paid to the Persons in whose names the Notes (or their
respective Predecessor Notes)
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are registered on such Special Record Date and shall no longer be payable
pursuant to the following clause (2).
(4) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which the Notes may be listed, and upon such notice
as may be required by such exchange, if, after notice given by the Company
to the Trustee of the proposed payment pursuant to this clause (2), such
payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section 3.07, each Note
delivered under this Indenture upon transfer of or in exchange for or in lieu of
any other Note shall carry the rights to interest accrued and unpaid, and to
accrue, that were carried by such other Note.
Section 3.08 Persons Deemed Owners. The Company any other obligor
upon the Notes, the Trustee and any agent of any of them may treat the Person in
whose name any Note is registered as the owner of such Note for the purpose of
receiving payment of principal of (and premium, if any), and (subject to Section
3.07) interest on, such Note and for all other purposes whatsoever, whether or
not such Note be overdue, and neither the Company, any other obligor upon the
Notes, the Trustee nor any agent of any of them shall be affected by notice to
the contrary.
Section 3.09 Cancellation. All Notes surrendered for payment,
redemption, transfer, exchange or conversion shall, if surrendered to any Person
other than the Trustee, be delivered to the Trustee and, if not already
cancelled, shall be promptly cancelled by it. The Company may at any time
deliver to the Trustee for cancellation any Notes previously authenticated and
delivered hereunder that the Company may have acquired in any manner whatsoever,
and all Notes so delivered shall be promptly cancelled by the Trustee. No Notes
shall be authenticated in lieu of or in exchange for any Notes cancelled as
provided in this Section 3.09, except as expressly permitted by this Indenture.
All cancelled Notes held by the Trustee shall be disposed of as directed by a
Company Order of the Company.
Section 3.10 Computation of Interest. Interest on the Notes shall be
computed on the basis of a 360-day year of twelve 30-day months.
Section 3.11 CUSIP Numbers. The Company in issuing the Notes may use
"CUSIP" numbers (if then generally in use), and if so, the Trustee may use the
CUSIP numbers in notices of redemption or exchange as a convenience to Holders;
provided, however, that any such notice may state that no representation is made
as to the correctness or accuracy of the CUSIP number printed in the notice or
on the Notes, and that reliance may be placed only on the other identification
numbers printed on the Notes.
Section 3.12 Book-Entry Provisions for Global Notes.
(a) Each Global Note initially shall (i) be registered in the name
of the Depositary for such Global Note or the nominee of such Depositary and
(ii) be delivered to the Trustee as custodian for such Depositary. Neither the
Company nor any agent of the Company shall have any responsibility or liability
for any aspect of the records relating to or payments
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made on account of beneficial ownership interests of a Global Note, or for
maintaining, supervising or reviewing any records relating to such beneficial
ownership interests.
Members of, or participants in, the Depositary ("Agent Members")
shall have no rights under this Indenture with respect to any Global Note, and
the Depositary may be treated by the Company, any other obligor upon the Notes,
the Trustee and any agent of any of them as the absolute owner of such Global
Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein
shall prevent the Company, any other obligor upon the Notes, the Trustee or any
agent of any of them from giving effect to any written certification, proxy or
other authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices governing
the exercise of the rights of a beneficial owner of any Note. The registered
holder of a Global Note may grant proxies and otherwise authorize any Person,
including Agent Members and Persons that may hold interests through Agent
Members, to take any action that a Holder is entitled to take under this
Indenture or the Notes.
(b) Transfers of a Global Note shall be limited to transfers of such
Global Note in whole, but, subject to the immediately succeeding sentence, not
in part, to the Depositary, its successors or their respective nominees.
Interests of beneficial owners in a Global Note may not be transferred or
exchanged for Physical Notes, unless (i) the Company has consented thereto in
writing, or such transfer or exchange is made pursuant to the next sentence, and
(ii) such transfer or exchange is in accordance with the applicable rules and
procedures of the Depositary and the provisions of Sections 3.05 and 3.13.
Subject to the limitation on issuance of Physical Notes set forth in Section
3.13(3), U.S. Physical Notes or Offshore Physical Notes shall be transferred to
all beneficial owners in exchange for their beneficial interests in the relevant
U.S. Global Note or the relevant Offshore Global Note, respectively, if (i) the
Depositary notifies the Company that it is unwilling or unable to continue as
Depositary for the applicable Global Note or the Depositary ceases to be a
"Clearing Agency" registered under the Exchange Act and the Company is unable to
locate a qualified successor depositary within 90 days, (ii) the Company, at its
option, notifies the Trustee in writing that it elects to cause the issuance of
Physical Notes under this Indenture or (iii) an Event of Default has occurred
and is continuing and the Note Registrar has received a written request from the
Depositary to issue Physical Notes.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Note to beneficial owners for Physical Notes
pursuant to paragraph (b) of this Section 3.12, the Note Registrar shall record
on its books and records the date and a decrease in the principal amount of such
Global Note in an amount equal to the beneficial interest in the Global Note
being transferred, and the Company shall execute, and the Trustee shall
authenticate and deliver, one or more Physical Notes of like tenor and principal
amount of authorized denominations.
(d) In connection with a transfer of an entire Global Note to
beneficial owners pursuant to paragraph (b) of this Section 3.12, the applicable
Global Note shall be deemed to be surrendered to the Trustee for cancellation,
and the Company shall execute, and the Trustee shall authenticate and deliver,
to each beneficial owner identified by the Depositary in exchange for its
beneficial interest in the applicable Global Note, an equal aggregate principal
amount at maturity
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of U.S. Physical Notes (in the case of any U.S. Global Note) or Offshore
Physical Notes (in the case of any Offshore Global Note), as the case may be, of
authorized denominations.
(e) The transfer and exchange of a Global Note or beneficial
interests therein shall be effected through the Depositary, in accordance with
this Indenture (including applicable restrictions on transfer set forth in
Section 3.13) and the procedures of the Depositary therefor. Any beneficial
interest in one of the Global Notes that is transferred to a Person who takes
delivery in the form of an interest in a different Global Note will, upon
transfer, cease to be an interest in such Global Note and become an interest in
the other Global Note and, accordingly, will thereafter be subject to all
transfer restrictions, if any, and other procedures applicable to beneficial
interests in such other Global Note for as long as it remains such an interest.
A transferor of a beneficial interest in a Global Note shall deliver to the
Registrar a written order given in accordance with the Depositary's procedures
containing information regarding the participant account of the Depositary to be
credited with a beneficial interest in the relevant Global Note. Subject to
Section 3.13, the Registrar shall, in accordance with such instructions,
instruct the Depositary to credit to the account of the Person specified in such
instructions a beneficial interest in such Global Note and to debit the account
of the Person making the transfer of the beneficial interest in the Global Note
being transferred.
(f) Any Physical Note delivered in exchange for an interest in a
Global Note pursuant to paragraph (b) of this Section 3.12 shall, unless such
exchange is made on or after the Resale Restriction Termination Date applicable
to such Note and except as otherwise provided in Section 2.03 and Section 3.13,
bear the Private Placement Legend.
(g) The Company, any other obligor upon the Notes or the Trustee, in
the discretion of any of them, may treat as the Act of a Holder any instrument
or writing of any Person that is identified by the Depositary as the owner of a
beneficial interest in the Global Note, provided that the fact and date of the
execution of such instrument or writing is proved in accordance with Section
1.08(b).
Section 3.13 Special Transfer Provisions. Transfers to Non-U.S.
Persons. (1) The following provisions shall apply with respect to the
registration of any proposed transfer of a Note that is a Restricted Security to
any Non-U.S. Person: The Note Registrar shall register such transfer if it
complies with all other applicable requirements of this Indenture (including
Section 3.05) and,
(a) if (x) such transfer is after the relevant Resale Restriction
Termination Date with respect to such Note or (y) the distribution compliance
period set forth in Regulation S has expired and the proposed transferor has
delivered to the Note Registrar a Regulation S Certificate and, unless otherwise
agreed by the Company and the Trustee, an opinion of counsel, certifications and
other information satisfactory to the Company and the Trustee, and
(b) if the proposed transferor is or is acting through an Agent
Member holding a beneficial interest in a Global Note, upon receipt by the Note
Registrar of (x) the certificate, opinion, certifications and other information,
if any, required by clause (a) above and (y) written instructions given in
accordance with the Depositary's and the Note Registrar's procedures;
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(c) whereupon (i) the Note Registrar shall reflect on its books and
records the date and (if the transfer does not involve a transfer of any
Outstanding Physical Note) a decrease in the principal amount of the relevant
Global Note in an amount equal to the principal amount of the beneficial
interest in the relevant Global Note to be transferred, and (ii) either (A) if
the proposed transferee is or is acting through an Agent Member holding a
beneficial interest in a relevant Offshore Global Note, the Trustee shall
reflect on its books and records the date and an increase in the principal
amount of such Offshore Global Note in an amount equal to the principal amount
of the beneficial interest being so transferred or (B) otherwise the Company
shall execute and the Trustee shall authenticate and deliver one or more
Physical Notes of like tenor and amount.
(5) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Note that is a
Restricted Security to a QIB (excluding transfers to Non-U.S. Persons): The Note
Registrar shall register such transfer if it complies with all other applicable
requirements of this Indenture (including Section 3.05) and,
(a) if such transfer is being made by a proposed transferor who has
checked the box provided for on the form of such Note stating, or has otherwise
certified to the Company and the Note Registrar in writing, that the sale has
been made in compliance with the provisions of Rule 144A to a transferee who has
signed the certification provided for on the form of such Note stating, or has
otherwise certified to the Company and the Note Registrar in writing, that it is
purchasing such Note for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a QIB
within the meaning of Rule 144A, and is aware that the sale to it is being made
in reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as it has requested pursuant to Rule 144A or has
determined not to request such information and that it is aware that the
transferor is relying upon its foregoing representations in order to claim the
exemption from registration provided by Rule 144A; and
(b) if the proposed transferee is an Agent Member, and the Note to
be transferred consists of a Physical Note that after transfer is to be
evidenced by an interest in a Global Note or consists of a beneficial interest
in a Global Note that after the transfer is to be evidenced by an interest in a
different Global Note, upon receipt by the Note Registrar of written
instructions given in accordance with the Depositary's and the Note Registrar's
procedures, whereupon the Note Registrar shall reflect on its books and records
the date and an increase in the principal amount of the transferee Global Note
in an amount equal to the principal amount of the Physical Note or such
beneficial interest in such transferor Global Note to be transferred, and the
Trustee shall cancel the Physical Note so transferred or reflect on its books
and records the date and a decrease in the principal amount of such transferor
Global Note, as the case may be.
(6) Limitation on Issuance of Physical Notes. No Physical Note shall
be exchanged for a beneficial interest in any Global Note, except in accordance
with Section 3.12 and this Section 3.13.
A beneficial owner of an interest in an Offshore Global Note shall
not be permitted to exchange such interest for a Physical Note until a date,
which must be after the expiration of the distribution compliance period set
forth in Regulation S, on which the Company
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receives a certificate of beneficial ownership substantially in the form of
Exhibit D from such beneficial owner (a "Certificate of Beneficial Ownership").
Such date, as it relates to an Offshore Global Note, is herein referred to as
the "Offshore Note Exchange Date."
(7) Private Placement Legend. Upon the transfer, exchange or
replacement of Notes not bearing the Private Placement Legend, the Note
Registrar shall deliver Notes that do not bear the Private Placement Legend.
Upon the transfer, exchange or replacement of Notes bearing the Private
Placement Legend, the Note Registrar shall deliver only Notes that bear the
Private Placement Legend, unless (i) the requested transfer is after the
relevant Resale Restriction Termination Date with respect to such Notes, or (ii)
upon written request of the Company after there is delivered to the Note
Registrar an opinion of counsel (which opinion and counsel are satisfactory to
the Company and the Trustee) to the effect that neither such legend nor the
related restrictions on transfer are required in order to maintain compliance
with the provisions of the Securities Act, or (iii) with respect to an Offshore
Global Note or Offshore Physical Note only, with the agreement of the Company on
or after the Offshore Note Exchange Date with respect to such Note, or (iv) such
Notes are sold or exchanged pursuant to an effective registration statement
under the Securities Act.
(8) Other Transfers. The Note Registrar shall effect and register,
upon receipt of a written request from the Company so to do, a transfer not
otherwise permitted by this Section 3.13, such registration to be done in
accordance with the otherwise applicable provisions of this Section 3.13, upon
the furnishing by the proposed transferor or transferee of a written opinion of
counsel (which opinion and counsel are satisfactory to the Company and the
Trustee) to the effect that, and such other certifications or information as the
Company may require to confirm that, the proposed transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act.
A Note that is a Restricted Security may not be transferred other
than as provided in this Section 3.13. A beneficial interest in a Global Note
that is a Restricted Security may not be exchanged for a beneficial interest in
another Global Note other than through a transfer in compliance with this
Section 3.13.
(9) General. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Note only as provided in this
Indenture.
The Note Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 3.12 or this Section
3.13 (including all Notes received for transfer pursuant to this Section 3.13).
The Company shall have the right to require the Note Registrar to deliver to the
Company, at the Company's expense, copies of all such letters, notices or other
written communications at any reasonable time upon the giving of reasonable
written notice to the Note Registrar.
In connection with any transfer of any Note, the Trustee, the Note
Registrar and the Company shall be entitled to receive, shall be under no duty
to inquire into, may conclusively presume the correctness of, and shall be fully
protected in relying upon the certificates, opinions
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and other information referred to herein (or in the forms provided herein,
attached hereto or to the Notes, or otherwise) received from any Holder and any
transferee of any Note regarding the validity, legality and due authorization of
any such transfer, the eligibility of the transferee to receive such Note and
any other facts and circumstances related to such transfer.
Section 3.14 Payment of Additional Interest. (a) Under certain
circumstances the Company will be obligated to pay certain additional amounts of
interest to the Holders of certain Initial Notes, as more particularly set forth
in such Initial Notes.
(b) Under certain circumstances the Company may be obligated to pay
certain additional amounts of interest to the Holders of certain Initial
Additional Notes, as may be more particularly set forth in such Initial
Additional Notes.
ARTICLE 4
COVENANTS
Section 4.01 Payment of Principal, Premium and Interest. The Company
will duly and punctually pay the principal of (and premium, if any) and interest
on the Notes in accordance with the terms of the Notes and this Indenture.
Section 4.02 Maintenance of Office or Agency. The Company will
maintain in the Borough of Manhattan, The City of New York an office or agency
where Notes may be presented or surrendered for payment, where Notes may be
surrendered for transfer or exchange and where notices and demands to or upon
the Company in respect of the Notes and this Indenture may be served. The
Company will give prompt written notice to the Trustee of the location, and of
any change in the location, of such office or agency. If at any time the Company
shall fail to maintain such office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee. The
Company hereby designates the corporate trust office of an affiliate of the
Trustee, which office on the Issue Date is located at 61 Broadway, 15th Floor,
New York, New York 10006 as the initial Place of Payment and appoints the
Trustee its agent to receive all such presentations, surrenders, notices and
demands so long as such corporate trust office remains the Place of Payment.
Section 4.03 Money for Payments To Be Held in Trust. If the Company
shall at any time act as its own Paying Agent, it will, on or before each due
date of the principal of (and premium, if any) or interest on, any of the Notes,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal (and premium, if any) or interest so
becoming due until such sums shall be paid to such Persons or otherwise disposed
of as herein provided, and will promptly notify the Trustee of its action or
failure so to act.
If the Company is not acting as its own Paying Agent, it will, prior
to each due date of the principal of (and premium, if any) or interest on, any
Notes, deposit with a Paying Agent a sum sufficient to pay the principal (and
premium, if any) or interest, so becoming due, such sum to be held in trust for
the benefit of the Persons entitled to such principal, premium or
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interest, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure so to act.
If the Company is not acting as its own Paying Agent, the Company
will cause any Paying Agent other than the Trustee to execute and deliver to the
Trustee an instrument in which such Paying Agent shall agree with the Trustee,
subject to the provisions of this Section 4.03, that such Paying Agent will
(1) hold all sums held by it for the payment of principal of (and
premium, if any) or interest on Notes in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Notes) in the making of any such payment of
principal (and premium, if any) or interest;
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent; and
(4) acknowledge, accept and agree to comply in all respects with the
provisions of this Indenture and TIA relating to the duties, rights and
liabilities of such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of (and premium,
if any) or interest on any Note and remaining unclaimed for two years after such
principal (and premium, if any) or interest has become due and payable shall be
paid in the appropriate proportion to the Company on Company Request, or (if
then held by the Company) shall be discharged from such trust; and the Holder of
such Note shall thereafter, as an unsecured general creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease.
Section 4.04 SEC Reports. Notwithstanding that the Company may not
be required to be or remain subject to the reporting requirements of Section
13(a) or 15(d) of the Exchange Act, the Company will file with the SEC (unless
such filing is not permitted under the Exchange Act or by the SEC), so long as
Notes are outstanding, the annual reports, information, documents and other
reports that the Company is required to file with the Commission pursuant to
such Section 13(a) or 15(d) or would be so required to file if the Company were
so subject. The Company will also, within 15 days after the date on which the
Company was so required to
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file or would be so required to file if the Company were so subject (or, if
later, 120 days after the Issue Date), transmit by mail to all Holders, as their
names and addresses appear in the Note Register, and to the Trustee copies of
any such information, documents and reports (without exhibits) so required to be
filed (or, in lieu of one or more of the annual reports for the fiscal year
ended December 25, 1999 and the quarterly reports for the following fiscal year,
a registration statement filed with the SEC under the Securities Act or any
amendment thereto, provided such registration statement or amendment contains
the information that would have been included in each such report). The Company
will be deemed to have satisfied such requirements if Holding files and provides
reports, documents and information of the types otherwise so required, in each
case within the applicable time periods, and the Company is not required to file
such reports, documents and information separately under the applicable rules
and regulations of the SEC (after giving effect to any exemptive relief) because
of the filings by Holding. The Company also will comply with the other
provisions of TIA ss. 314(a).
Section 4.05 Statement as to Default. The Company will deliver to
the Trustee, within 120 days after the end of each fiscal year of the Company
ending after the date hereof, an Officer's Certificate, to the effect that to
the best knowledge of the signer thereof the Company is or is not in default in
the performance and observance of any of the terms, provisions and conditions of
this Indenture (without regard to any period of grace or requirement of notice
provided hereunder) and, if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which such signer may have
knowledge. To the extent required by the TIA, each Note Guarantor shall comply
with TIA ss. 314(a)(4). The individual signing any certificate given by any
Person pursuant to this Section 4.05 shall be the principal executive, financial
or accounting officer of such Person, in compliance with TIA ss. 314(a)(4).
Section 4.06 Limitation on Indebtedness.
(a) The Company will not, and will not permit any Restricted
Subsidiary to, Incur any Indebtedness; provided, however, that the Company or
any Note Guarantor may Incur Indebtedness if on the date of the Incurrence of
such Indebtedness, after giving effect to the Incurrence thereof, the
Consolidated Coverage Ratio would be greater than 2.00:1.00 if such Indebtedness
is Incurred on or prior to December 1, 2001 or 2.25:1.00 if such Indebtedness is
Incurred thereafter.
(b) Notwithstanding the foregoing paragraph (a) of this Section
4.06, the Company and its Restricted Subsidiaries may Incur the following
Indebtedness:
(i) Indebtedness Incurred pursuant to Credit Facilities (including
but not limited to in respect of letters of credit or bankers' acceptances
issued or created thereunder) and (without limiting the foregoing) any
Refinancing Indebtedness in respect thereof, in a maximum principal amount
at any time outstanding (giving effect to any refinancing thereof) not
exceeding in the aggregate the amount equal to the sum of (x) $475.0
million and (y) the aggregate amount by which the Borrowing Base
determined as of the date of such Incurrence exceeds $245.0 million (plus
in the case of any refinancing of any Credit Facility or any portion
thereof, the aggregate amount of fees, underwriting discounts, premiums
and other costs and expenses incurred in connection with such refinancing)
less the aggregate principal amount of Indebtedness
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Incurred pursuant to this clause (b)(i) under the Credit Facilities (or
any refinancing thereof) that is permanently repaid pursuant to Section
4.10;
(ii) Indebtedness (A) of any Restricted Subsidiary to the Company or
(B) of the Company or any Restricted Subsidiary to any Restricted
Subsidiary; provided, that any subsequent issuance or transfer of any
Capital Stock of such Restricted Subsidiary to which such Indebtedness is
owed, or other event, that results in such Restricted Subsidiary ceasing
to be a Restricted Subsidiary or any other subsequent transfer of such
Indebtedness (except to the Company or a Restricted Subsidiary) will be
deemed, in each case, an Incurrence of such Indebtedness by the issuer
thereof;
(iii) Indebtedness represented by the Notes (other than Additional
Notes), any Indebtedness (other than the Indebtedness described in clauses
(i) or (ii) above) outstanding on the Issue Date and any Refinancing
Indebtedness Incurred in respect of any Indebtedness described in this
clause (iii) or paragraph (a) of this Section 4.06;
(iv) Purchase Money Obligations and Capitalized Lease Obligations,
and any Refinancing Indebtedness with respect thereto, in an aggregate
principal amount at any time outstanding (giving effect to any refinancing
thereof) not exceeding an amount equal to the greater of (x) $35.0 million
and (y) 5% of Consolidated Tangible Assets;
(v) Indebtedness of any Person that is assumed by the Company or any
Restricted Subsidiary in connection with its acquisition of assets from
such Person or any Affiliate thereof or is issued and outstanding on or
prior to the date on which such Person was acquired by the Company or any
Restricted Subsidiary or merged or consolidated with or into any
Restricted Subsidiary (other than Indebtedness Incurred to finance, or
otherwise in connection with, such acquisition), provided that on the date
of such acquisition, merger or consolidation, after giving effect thereto,
the Company could Incur at least $1.00 of additional Indebtedness pursuant
to paragraph (a) above of this Section 4.06; and any Refinancing
Indebtedness with respect to any such Indebtedness;
(vi) (A) Guarantees by the Company or any Restricted Subsidiary of
Indebtedness or any other obligation or liability of the Company or any
Restricted Subsidiary (other than any Indebtedness incurred by the Company
or such Restricted Subsidiary, as the case may be, in violation of this
Section 4.06, or (B) without limiting Section 4.12, Indebtedness of the
Company or any Restricted Subsidiary arising by reason of any Lien granted
by or applicable to such Person securing Indebtedness of the Company or
any Restricted Subsidiary (other than any Indebtedness incurred by the
Company or such Restricted Subsidiary, as the case may be, in violation of
this Section 4.06);
(vii) Indebtedness of the Company or any Restricted Subsidiary (A)
arising from the honoring of a check, draft or similar instrument of such
Person drawn against insufficient funds, provided that such Indebtedness
is extinguished within five Business Days of its incurrence, or (B)
consisting of guarantees, indemnities, obligations in respect of earnouts
or other purchase price adjustments, or similar obligations, Incurred in
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connection with the acquisition or disposition of any business, assets or
Person (including pursuant to the Allied Acquisition);
(viii) Indebtedness of the Company or any Restricted Subsidiary in
respect of (A) letters of credit, bankers' acceptances or other similar
instruments or obligations issued, or relating to liabilities or
obligations incurred, in the ordinary course of business (including those
issued to governmental entities in connection with self-insurance under
applicable workers' compensation statutes), or (B) completion guarantees,
surety, judgment, appeal or performance bonds, or other similar bonds,
instruments or obligations, provided, or relating to liabilities or
obligations incurred, in the ordinary course of business, or (C) Hedging
Obligations entered into for bona fide hedging purposes in the ordinary
course of business, (D) Management Guarantees, (E) Agent Guarantees in an
aggregate principal amount not exceeding $10.0 million outstanding at any
time, or (F) the financing of insurance premiums in the ordinary course of
business;
(ix) Indebtedness of a Receivables Subsidiary secured by a Lien on
all or part of the assets disposed of in, or otherwise incurred in
connection with, a Financing Disposition, which Indebtedness is, except
for Standard Receivables Obligations, otherwise without recourse to the
Company or any Restricted Subsidiary of the Company (other than any
Receivables Subsidiary);
(x) Indebtedness of a Foreign Subsidiary if, on the date of
Incurrence of such Indebtedness, after giving effect to the Incurrence
thereof, (x) the Consolidated Coverage Ratio would be at least 2.25:1.00
and (y) if, as a result of such Incurrence, such Foreign Subsidiary shall
then become subject to any restriction or limitation (under any agreement
or instrument governing such Indebtedness) on its ability to pay dividends
or make other distributions to the Company, the Foreign Subsidiary
Coverage Ratio would be greater than 2.75:1.00; provided, that if such
Indebtedness is not incurred pursuant to the preceding clause (y), such
Indebtedness shall not be amended, modified or otherwise supplemented such
that such Foreign Subsidiary will become subject to any such restriction
or limitation referred to in such clause unless such Indebtedness could
then be Incurred pursuant to such clause; and any Refinancing Indebtedness
with respect to any such Indebtedness; and
(xi) Indebtedness of the Company or any Restricted Subsidiary in an
aggregate principal amount at any time outstanding (giving effect to any
refinancing thereof) not exceeding an amount equal to $45.0 million.
(c) For purposes of determining compliance with, and the outstanding
principal amount of any particular Indebtedness Incurred pursuant to and in
compliance with, this Section 4.06, (i) any other obligation of the obligor on
such Indebtedness (or of any other Person who could have Incurred such
Indebtedness under this Section 4.06) arising under any Guarantee, Lien or
letter of credit, bankers' acceptance or other similar instrument or obligation
supporting such Indebtedness shall be disregarded to the extent that such
Guarantee, Lien or letter of credit, bankers' acceptance or other similar
instrument or obligation secures the principal amount of such Indebtedness; (ii)
in the event that Indebtedness meets the criteria of more than one of the types
of Indebtedness described in paragraph (b) of this Section 4.06, the
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Company, in its sole discretion, shall classify such item of Indebtedness and
only be required to include the amount and type of such Indebtedness in one of
such clauses; and (iii) the amount of Indebtedness issued at a price that is
less than the principal amount thereof shall be equal to the amount of the
liability in respect thereof determined in accordance with GAAP.
(d) For purposes of determining compliance with any
Dollar-denominated restriction on the Incurrence of Indebtedness denominated in
a foreign currency, the Dollar-equivalent principal amount of such Indebtedness
Incurred pursuant thereto shall be calculated based on the relevant currency
exchange rate in effect on the date that such Indebtedness was Incurred, in the
case of term Indebtedness, or first committed, in the case of revolving credit
Indebtedness, provided that (x) the Dollar-equivalent principal amount of any
such Indebtedness outstanding on the Issue Date shall be calculated based on the
relevant currency exchange rate in effect on the Issue Date, (y) if such
Indebtedness is Incurred to refinance other Indebtedness denominated in a
foreign currency, and such refinancing would cause the applicable Dollar-
denominated restriction to be exceeded if calculated at the relevant currency
exchange rate in effect on the date of such refinancing, such Dollar-denominated
restriction shall be deemed not to have been exceeded so long as the principal
amount of such refinancing Indebtedness does not exceed the principal amount of
such Indebtedness being refinanced and (z) the Dollar-equivalent principal
amount of Indebtedness denominated in a foreign currency and Incurred pursuant
to the Senior Credit Facility shall be calculated based on the relevant currency
exchange rate in effect on, at the Company's option, (i) the Issue Date, (ii)
any date on which any of the respective commitments under the Senior Credit
Facility shall be reallocated between or among facilities or subfacilities
thereunder, or on which such rate is otherwise calculated for any purpose
thereunder, or (iii) the date of such Incurrence. The principal amount of any
Indebtedness Incurred to refinance other Indebtedness, if Incurred in a
different currency from the Indebtedness being refinanced, shall be calculated
based on the currency exchange rate applicable to the currencies in which such
respective Indebtedness is denominated that is in effect on the date of such
refinancing.
Section 4.07 Limitation on Layering. The Company shall not Incur any
Indebtedness that is expressly subordinated in right of payment to any Senior
Indebtedness of the Company, unless such Indebtedness so Incurred ranks pari
passu in right of payment with the Notes, or is subordinated in right of payment
to the Notes. No Note Guarantor shall Incur any Indebtedness that is expressly
subordinated in right of payment to any Guarantor Senior Indebtedness of such
Note Guarantor, unless such Indebtedness so Incurred ranks pari passu in right
of payment with such Note Guarantor's Note Guarantee, or is subordinated in
right of payment to such Note Guarantor's Note Guarantee. Unsecured Indebtedness
is not deemed to be subordinate or junior to secured Indebtedness merely because
it is unsecured, and Indebtedness that is not guaranteed by a particular Person
is not deemed to be subordinate or junior to Indebtedness that is so guaranteed
merely because it is not so guaranteed.
Section 4.08 Limitation on Restricted Payments.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary, directly or indirectly, to (i) declare or pay any dividend or make
any distribution on or in respect of its Capital Stock (including any such
payment in connection with any merger or consolidation to which the Company or
any Restricted Subsidiary is a party) except (x) dividends or
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distributions payable solely in its Capital Stock (other than Disqualified
Stock) and (y) dividends or distributions payable to the Company or any
Restricted Subsidiary (and, in the case of any such Restricted Subsidiary making
such dividend or distribution, to other holders of its Capital Stock on no more
than a pro rata basis, measured by value), (ii) purchase, redeem, retire or
otherwise acquire for value any Capital Stock of the Company held by Persons
other than the Company or a Restricted Subsidiary, (iii) purchase, repurchase,
redeem, defease or otherwise acquire or retire for value, prior to scheduled
maturity, scheduled repayment or scheduled sinking fund payment, any
Subordinated Obligations (other than a purchase, redemption, defeasance or other
acquisition or retirement for value in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each case due within one
year of the date of such acquisition or retirement) or (iv) make any Investment
(other than a Permitted Investment) in any Person (any such dividend,
distribution, purchase, redemption, repurchase, defeasance, other acquisition or
retirement or Investment being herein referred to as a "Restricted Payment"), if
at the time the Company or such Restricted Subsidiary makes such Restricted
Payment:
(1) a Default shall have occurred and be continuing (or would result
therefrom);
(2) the Company could not incur at least an additional $1.00 of
Indebtedness pursuant to paragraph (a) of Section 4.06; or
(3) the aggregate amount of such Restricted Payment and all other
Restricted Payments (the amount so expended, if other than in cash, to be
as determined in good faith by the Board of Directors, whose determination
shall be conclusive) declared or made subsequent to the Issue Date and
then outstanding would exceed the sum of:
(A) 50% of the Consolidated Net Income accrued during the
period (treated as one accounting period) from September 30, 1999 to
the end of the most recent fiscal quarter ending prior to the date
of such Restricted Payment for which consolidated financial
statements of the Company are available (or, in case such
Consolidated Net Income shall be a negative number, 100% of such
negative number);
(B) the aggregate Net Cash Proceeds and the fair market value
of Qualified Proceeds received (x) by the Company as capital
contributions to the Company after the Issue Date or from the
issuance or sale (other than to a Restricted Subsidiary) of its
Capital Stock (other than Disqualified Stock) after the Issue Date
or (y) by the Company or any Restricted Subsidiary from the issuance
and sale by the Company or any Restricted Subsidiary after the Issue
Date of Indebtedness that shall have been converted into or
exchanged for Capital Stock of the Company (other than Disqualified
Stock), plus the amount of cash and the fair market value of
Qualified Proceeds received by the Company or any Restricted
Subsidiary upon such conversion or exchange;
(C) the aggregate amount equal to the net reduction in
Investments in Unrestricted Subsidiaries resulting from (i)
dividends, distributions, interest payments, return of capital,
repayments of Investments or other transfers of assets
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to the Company or any Restricted Subsidiary from any Unrestricted
Subsidiary (in each case, in the form of cash, Cash Equivalents or
Qualified Proceeds), or (ii) the redesignation of any Unrestricted
Subsidiary as a Restricted Subsidiary (valued in each case as
provided in the definition of "Investment"), not to exceed in the
case of any such Unrestricted Subsidiary the aggregate amount of
Investments (other than Permitted Investments) made by the Company
or any Restricted Subsidiary in such Unrestricted Subsidiary after
the Issue Date; and
(D) in the case of any disposition or repayment of any
Investment (in each case, in the form of cash, Cash Equivalents or
Qualified Proceeds) constituting a Restricted Payment (without
duplication of any amount deducted in calculating the amount of
Investments at any time outstanding included in the amount of
Restricted Payments), an amount in the aggregate equal to the lesser
of the return of capital, repayment or other proceeds with respect
to all such Investments and the initial amount of all such
Investments.
(b) The provisions of paragraph (a) of this Section 4.08 will not
prohibit any of the following (each, a "Permitted Payment"):
(i) any purchase, redemption, repurchase, defeasance or other
acquisition or retirement of Capital Stock of the Company or Subordinated
Obligations made by exchange (including any such exchange pursuant to the
exercise of a conversion right or privilege in connection with which cash
is paid in lieu of the issuance of fractional shares) for, or out of the
proceeds of the substantially concurrent issuance or sale of, Capital
Stock of the Company (other than Disqualified Stock and other than Capital
Stock issued or sold to a Subsidiary) or a substantially concurrent
capital contribution to the Company; provided, that the Net Cash Proceeds
from such issuance, sale or capital contribution shall be excluded in
subsequent calculations under clause (B) of the preceding paragraph (a) of
this Section 4.08;
(ii) any purchase, redemption, repurchase, defeasance or other
acquisition or retirement of Subordinated Obligations (x) made by exchange
for, or out of the proceeds of the substantially concurrent issuance or
sale of, Refinancing Indebtedness Incurred in compliance with Section
4.06; (y) from Net Available Cash to the extent permitted by Section 4.10;
or (z) to the extent required by the agreement governing such Subordinated
Obligations only following the occurrence of a Change of Control
Triggering Event (or, in the case of Acquired Debt, any similar event),
but only if in each case, the Company shall have complied with Section
4.14 and, if required, purchased all Notes tendered pursuant to the offer
to repurchase all the Notes required thereby, prior to purchasing or
repaying such Subordinated Obligations;
(iii) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividend would have complied
with the preceding paragraph (a) of this Section 4.08;
(iv) loans, advances, dividends or distributions by the Company to
Holding to permit Holding to repurchase or otherwise acquire its Capital
Stock (including any
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options, warrants or other rights in respect thereof), or payments by the
Company to repurchase or otherwise acquire Capital Stock (including any
options, warrants or other rights in respect thereof), in each case from
Management Investors, such payments, loans, advances, dividends or
distributions not to exceed an amount (net of repayments of any such loans
or advances) equal to (A) $12.5 million plus (B) $2.5 million multiplied
by the number of calendar years that have commenced since the Issue Date
plus (C) the Net Cash Proceeds received by the Company since the Issue
Date from, or as a capital contribution from, the issuance or sale to
Management Investors of Capital Stock (including any options, warrants or
other rights in respect thereof), to the extent such Net Cash Proceeds are
not included in any calculation under clause (3)(B)(x) of the preceding
paragraph (a) of this Section 4.08;
(v) the payment by the Company of, or loans, advances, dividends or
distributions by the Company to Holding to pay, dividends on the common
stock or equity of the Company or Holding following a public offering of
such common stock or equity, in an amount not to exceed in any fiscal year
6% of the aggregate gross proceeds received by the Company in or from such
public offering;
(vi) Restricted Payments (including loans or advances) in an
aggregate amount outstanding at any time not to exceed $10.0 million (net
of repayments of any such loans or advances);
(vii) loans, advances, dividends or distributions to Holding or
other payments by the Company or any Restricted Subsidiary (A) to satisfy
or permit Holding to satisfy obligations under the Management Agreements,
(B) pursuant to the Tax Sharing Agreement, or (C) to pay or permit Holding
to pay any Holding Expenses or any Related Taxes;
(viii) payments by the Company, or loans, advances, dividends or
distributions by the Company to Holding to make payments, to holders of
Capital Stock of the Company or Holding in lieu of issuance of fractional
shares of such Capital Stock, not to exceed $100,000 in the aggregate
outstanding at any time;
(ix) the distribution, as a dividend or otherwise, of Investments in
Unrestricted Subsidiaries (with the exception of Investments in
Unrestricted Subsidiaries acquired pursuant to the definition of Permitted
Investments other than pursuant to clause (xvii) of such definition);
(x) the Transactions; and
(xi) any purchase, redemption, retirement or other acquisition of
Capital Stock that may be deemed to occur upon exercise of stock options,
warrants or similar rights to the extent such Capital Stock represents all
or part of the exercise price thereof;
provided, that (A) in the case of clauses (iii) and (v), the net amount of any
such Permitted Payment shall be included in subsequent calculations of the
amount of Restricted Payments, (B) in the case of clause (iv), 50% of the amount
of any such Permitted Payment shall be included in subsequent calculations of
the amount of Restricted Payments, (C) in all cases other
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than pursuant to clauses (A) and (B) immediately above, the net amount of any
such Permitted Payment shall be excluded in subsequent calculations of the
amount of Restricted Payments and (D) with respect to clauses (v) and (vi), no
Default or Event of Default shall have occurred or be continuing at the time of
any such Permitted Payment after giving effect thereto.
Section 4.09 Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Company will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause to exist or become effective
any consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to (i) pay dividends or make any other distributions on its Capital
Stock or pay any Indebtedness or other obligations owed to the Company, (ii)
make any loans or advances to the Company or (iii) transfer any of its property
or assets to the Company, except any encumbrance or restriction:
(1) pursuant to an agreement or instrument in effect at or entered
into on the Issue Date (including, without limitation, the Senior Credit
Facility), this Indenture or the Notes;
(2) pursuant to any agreement or instrument of a Person, or relating
to Indebtedness or Capital Stock of a Person, which Person is acquired by
or merged or consolidated with or into the Company or any Restricted
Subsidiary, or which agreement or instrument is assumed by the Company or
any Restricted Subsidiary in connection with an acquisition of assets from
such Person, as in effect at the time of such acquisition, merger or
consolidation (except to the extent that such Indebtedness was incurred to
finance, or otherwise in connection with, such acquisition, merger or
consolidation), provided that for purposes of this clause (2), if another
Person is the Successor Company, any Subsidiary thereof or agreement or
instrument of such Person or any such Subsidiary shall be deemed acquired
or assumed, as the case may be, by the Company or a Restricted Subsidiary,
as the case may be, when such Person becomes the Successor Company;
(3) pursuant to an agreement or instrument (a "Refinancing
Agreement") effecting a refinancing of Indebtedness Incurred pursuant to,
or that otherwise extends, renews, refunds, refinances or replaces, an
agreement or instrument referred to in clause (1) or (2) of this Section
4.09 or this clause (3) (an "Initial Agreement") or contained in any
amendment, supplement or other modification to an Initial Agreement (an
"Amendment"); provided, however, that the encumbrances and restrictions
contained in any such Refinancing Agreement or Amendment taken as a whole
are not materially less favorable to the Holders of the Notes than
encumbrances and restrictions contained in the Initial Agreement or
Initial Agreements to which such Refinancing Agreement or Amendment
relates (as determined in good faith by the Company);
(4) (A) that restricts in a customary manner the subletting,
assignment or transfer of any property or asset that is subject to a
lease, license or similar contract, or the assignment or transfer of any
lease, license or other contract, (B) by virtue of any transfer of,
agreement to transfer, option or right with respect to, or Lien on, any
property or assets of the Company or any Restricted Subsidiary not
otherwise prohibited by this Indenture, (C) contained in mortgages,
pledges or other security agreements securing
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Indebtedness of a Restricted Subsidiary to the extent restricting the
transfer of the property or assets subject thereto, (D) pursuant to
customary provisions restricting dispositions of real property interests
set forth in any reciprocal easement agreements of the Company or any
Restricted Subsidiary, (E) pursuant to Purchase Money Obligations that
impose encumbrances or restrictions on the property or assets so acquired,
(F) on cash or other deposits or net worth imposed by customers under
agreements entered into in the ordinary course of business, (G) pursuant
to customary provisions contained in agreements and instruments entered
into in the ordinary course of business (including but not limited to
leases and joint venture and other similar agreements entered into in the
ordinary course of business) or (H) that arises or is agreed to in the
ordinary course of business and does not detract from the value of
property or assets of the Company or any Restricted Subsidiary in any
manner material to the Company or such Restricted Subsidiary;
(5) with respect to a Restricted Subsidiary (or any of its property
or assets) imposed pursuant to an agreement entered into for the direct or
indirect sale or disposition of all or substantially all the Capital Stock
or assets of such Restricted Subsidiary (or the property or assets that
are subject to such restriction) pending the closing of such sale or
disposition;
(6) required by any applicable law, rule, regulation or order or by
any regulatory authority having jurisdiction over the Company or any
Restricted Subsidiary or any of their businesses; or
(7) pursuant to an agreement or instrument (A) relating to any
Indebtedness permitted to be Incurred subsequent to the Issue Date
pursuant to the provisions of Section 4.06, if the Company determines in
good faith that the encumbrances and restrictions contained in the
agreements and instruments relating to such Indebtedness, taken as a
whole, are not materially less favorable to the Holders of the Notes than
encumbrances and restrictions contained in the agreements and instruments
referred to in clause (1) of this Section 4.09, (B) relating to
Indebtedness of a Foreign Subsidiary incurred pursuant to clause (b)(i) or
(b)(x) of Section 4.06, (C) relating to a sale of accounts receivable by a
Foreign Subsidiary on customary terms (as determined in good faith by the
Company) or (D) relating to Indebtedness of or a Financing Disposition to
or by any Receivables Entity.
Section 4.10 Limitation on Sales of Assets and Subsidiary Stock.
(a) The Company will not, and will not permit any Restricted
Subsidiary to, make any Asset Disposition unless
(i) the Company or such Restricted Subsidiary receives consideration
(including by way of relief from, or by any other Person assuming
responsibility for, any liabilities, contingent or otherwise) at the time
of such Asset Disposition at least equal to the fair market value of the
shares and assets subject to such Asset Disposition, as such fair market
value may be determined (and shall be determined, to the extent such Asset
Disposition or any series of related Asset Dispositions involves aggregate
consideration
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in excess of $10.0 million) in good faith by the Board of Directors, whose
determination shall be conclusive (including as to the value of all
noncash consideration),
(ii) in the case of any Asset Disposition (or series of related
Asset Dispositions) at least 75% of the consideration therefor (excluding,
in the case of an Asset Disposition (or series of related Asset
Dispositions) of assets, any consideration by way of relief from, or by
any other Person assuming responsibility for, any liabilities, contingent
or otherwise, that are not Indebtedness) received by the Company or such
Restricted Subsidiary is in the form of (a) cash, or (b) Designated
Noncash Assets having an aggregate fair market value, taken together with
all other Designated Noncash Assets received in consideration for Asset
Dispositions pursuant to this clause (b) that are at the time outstanding,
not to exceed the greater of (x) 5% of Consolidated Tangible Assets and
(y) $35.0 million at the time of receipt of such Designated Noncash
Assets; and
(iii) an amount equal to 100% of the Net Available Cash from such
Asset Disposition is applied by the Company (or any Restricted Subsidiary,
as the case may be) as follows:
(E) first, either (x) to the extent the Company elects (or is
required by the terms of any Senior Indebtedness or Indebtedness of
a Restricted Subsidiary), to prepay, repay or purchase Senior
Indebtedness or such Indebtedness of a Restricted Subsidiary (in
each case other than Indebtedness owed to the Company or a
Restricted Subsidiary) within 365 days after the date of such Asset
Disposition, or (y) to the extent the Company or such Restricted
Subsidiary elects, to reinvest in Additional Assets (including by
means of an investment in Additional Assets by a Restricted
Subsidiary with Net Available Cash received by the Company or
another Restricted Subsidiary) within 365 days from the date of such
Asset Disposition;
(F) second, to the extent of the balance of such Net Available
Cash after application in accordance with clause (A) above (such
balance, the "Excess Proceeds"), to make an offer to purchase Notes
and (to the extent the Company or such Restricted Subsidiary elects,
or is required by the terms thereof) to purchase, redeem or repay
any other Senior Subordinated Indebtedness or Guarantor Senior
Subordinated Indebtedness, pursuant and subject to the conditions of
this Indenture and the agreements governing such other Indebtedness;
and
(G) third, to the extent of the balance of such Net Available
Cash after application in accordance with clauses (A) and (B) above,
to fund (to the extent consistent with any other applicable
provision of this Indenture) any general corporate purpose
(including but not limited to the repurchase, repayment or other
acquisition or retirement of any Subordinated Obligations);
provided, however, that in connection with any prepayment, repayment or purchase
of Indebtedness pursuant to clause (A)(x) or (B) above, the Company or such
Restricted Subsidiary will retire such Indebtedness and will cause the related
loan commitment (if any) to be permanently reduced in an amount equal to the
principal amount so prepaid, repaid or purchased.
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Notwithstanding the foregoing provisions of this Section 4.10, the
Company and the Restricted Subsidiaries shall not be required to apply any Net
Available Cash in accordance with this Section 4.10 except to the extent that
the aggregate Net Available Cash from all Asset Dispositions that is not applied
in accordance with this Section 4.10 exceeds $15.0 million. If the aggregate
principal amount of Notes, Senior Subordinated Indebtedness and Guarantor Senior
Subordinated Indebtedness validly tendered and not withdrawn (or otherwise
subject to purchase, redemption or repayment) in connection with an offer
pursuant to clause (B) above exceeds the Excess Proceeds, the Excess Proceeds
will be apportioned between the Notes and such Senior Subordinated Indebtedness
and Guarantor Senior Subordinated Indebtedness, with the portion of the Excess
Proceeds payable in respect of the Notes to equal the lesser of (x) the Excess
Proceeds amount multiplied by a fraction, the numerator of which is the
outstanding principal amount of the Notes and the denominator of which is the
sum of the outstanding principal amount of the Notes and the outstanding
principal amount of the relevant Senior Subordinated Indebtedness and Guarantor
Senior Subordinated Indebtedness, and (y) the aggregate principal amount of
Notes validly tendered and not withdrawn.
For the purposes of clause (ii) of the first paragraph of this
Section 4.10, the following are deemed to be cash: (1) Temporary Cash
Investments and Cash Equivalents, (2) the assumption of Indebtedness of the
Company (other than Disqualified Stock of the Company) or any Restricted
Subsidiary and the release of the Company or such Restricted Subsidiary from all
liability on payment of the principal amount of such Indebtedness in connection
with such Asset Disposition, (3) Indebtedness of any Restricted Subsidiary that
is no longer a Restricted Subsidiary as a result of such Asset Disposition, to
the extent that the Company and each other Restricted Subsidiary are released
from any Guarantee of payment of the principal amount of such Indebtedness in
connection with such Asset Disposition, (4) securities received by the Company
or any Restricted Subsidiary from the transferee that are converted by the
Company or such Restricted Subsidiary into cash within 180 days after the
consummation of such Asset Disposition and (5) consideration consisting of
outstanding Indebtedness of the Company or a Restricted Subsidiary which is then
retired.
(b) In the event of an Asset Disposition that requires the purchase
of Notes pursuant to clause (iii)(B) of the first paragraph of this Section
4.10, the Company will be required to purchase Notes tendered pursuant to an
offer by the Company for the Notes (the "Offer") at a purchase price of 100% of
their principal amount plus accrued and unpaid interest to the Purchase Date in
accordance with the procedures (including prorating in the event of
oversubscription) set forth in paragraph (c) of this Section 4.10. If the
aggregate purchase price of the Notes tendered pursuant to the Offer is less
than the Net Available Cash allotted to the purchase of Notes, the remaining Net
Available Cash will be available to the Company for use in accordance with
clause (iii)(B) of the first paragraph of this Section 4.10 (to repay Senior
Subordinated Indebtedness or Guarantor Senior Subordinated Indebtedness) or
clause (iii)(C) of the first paragraph of this Section 4.10. The Company shall
not be required to make an Offer for Notes pursuant to this Section 4.10 if the
Net Available Cash available therefor (after application of the proceeds as
provided in clause (iii)(A) of the first paragraph of this Section 4.10) is less
than $15.0 million for any particular Asset Disposition (which lesser amounts
shall be carried forward for purposes of determining whether an Offer is
required with respect to the Net Available Cash from any subsequent Asset
Disposition).
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(c) The Company will, not later than 45 days after the Company
becomes obligated to make an Offer pursuant to this Section 4.10, mail a notice
to each Holder with a copy to the Trustee stating: (1) that an Asset Disposition
that requires the purchase of a portion of the Notes has occurred and that such
Holder has the right (subject to the prorating described below) to require the
Company, to purchase a portion of such Holder's Notes at a purchase price in
cash equal to 100% of the principal amount thereof, plus accrued and unpaid
interest, if any, to the date of purchase (subject to Section 3.07); (2) the
circumstances and relevant facts and financial information regarding such Asset
Disposition; (3) the repurchase date (which shall be no earlier than 30 days nor
later than 60 days from the date such notice is mailed); (4) the instructions
determined by the Company, consistent with this Section 4.10, that a Holder must
follow in order to have its Notes purchased; and (5) the amount of the Offer.
If, upon the expiration of the period for which the Offer remains open, the
aggregate principal amount of Notes surrendered by Holders exceeds the amount of
the Offer, the Company will select the Notes to be purchased on a pro rata basis
(with such adjustments as may be deemed appropriate by the Issuers so that only
Notes in denominations of $1,000 or integral multiples thereof, shall be
purchased).
(d) The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Notes pursuant to this
Section 4.10. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 4.10, the Company will
comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this Section 4.10 by virtue
thereof.
Section 4.11 Limitation on Transactions with Affiliates.
(a) The Company will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, enter into or conduct any transaction or
series of related transactions (including the purchase, sale, lease or exchange
of any property or the rendering of any service) with any Affiliate of the
Company (an "Affiliate Transaction") unless (i) the terms of such Affiliate
Transaction are not materially less favorable to the Company or such Restricted
Subsidiary, as the case may be, than those that could be obtained at the time in
a transaction with a Person who is not such an Affiliate and (ii) if such
Affiliate Transaction involves aggregate consideration in excess of $10.0
million, the terms of such Affiliate Transaction have been approved by a
majority of the Disinterested Directors. For purposes of this paragraph, any
Affiliate Transaction shall be deemed to have satisfied the requirements set
forth in this paragraph if (x) such Affiliate Transaction is approved by a
majority of the Disinterested Directors or (y) in the event there are no
Disinterested Directors, a fairness opinion is provided by a nationally
recognized appraisal or investment banking firm with respect to such Affiliate
Transaction.
(b) The provisions of the preceding paragraph (a) of this Section
4.11 will not apply to:
(i) any Restricted Payment Transaction,
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(ii) (1) the entering into, maintaining or performance of any
employment contract, collective bargaining agreement, benefit plan,
program or arrangement, related trust agreement or any other similar
arrangement for or with any employee, officer or director heretofore or
hereafter entered into in the ordinary course of business, including
vacation, health, insurance, deferred compensation, severance, retirement,
savings or other similar plans, programs or arrangements, (2) the payment
of compensation, performance of indemnification or contribution
obligations, or any issuance, grant or award of stock, options, other
equity-related interests or other securities, to employees, officers or
directors in the ordinary course of business, (3) the payment of fees to
directors of the Company or any of its Subsidiaries, (4) any transaction
with an officer or director in the ordinary course of business not
involving more than $100,000 in any one case, or (5) Management Advances
and payments in respect thereof,
(iii) any transaction with the Company, any Restricted Subsidiary,
or any Receivables Entity,
(iv) any transaction arising out of agreements or instruments in
existence on the Issue Date, and any payments made pursuant thereto,
(v) execution, delivery and performance of the Tax Sharing Agreement
and Management Agreements, including (1) payment to CDR or any Affiliate
of CDR of a fee of $5.0 million plus out-of-pocket expenses in connection
with the Transactions, and (2) payment to CDR or any Affiliate of CDR of
fees of up to $1.0 million in any fiscal year plus all out-of-pocket
expenses incurred by CDR or any such Affiliate in connection with its
performance of management consulting, monitoring, financial advisory or
other services with respect to the Company and its Restricted
Subsidiaries,
(vi) the Transactions, all transactions in connection therewith
(including but not limited to the financing thereof), and all fees or
expenses paid or payable in connection with the Transactions,
(vii) any transaction in the ordinary course of business on terms
not materially less favorable to the Company or the relevant Restricted
Subsidiary than those that could be obtained at the time in a transaction
with a Person who is not an Affiliate of the Company, and
(viii) any transaction in the ordinary course of business, or
approved by a majority of the Board of Directors, between the Company or
any Restricted Subsidiary and any Affiliate of the Company controlled by
the Company that is a joint venture or similar entity.
Section 4.12 Limitation on Liens. The Company shall not, and shall
not permit any Restricted Subsidiary to, directly or indirectly, create or
permit to exist any Lien (other than Permitted Liens) on any of its property or
assets (including Capital Stock of any other Person), whether owned on the date
of this Indenture or thereafter acquired, securing any Indebtedness of the
Company or any Note Guarantor that by its terms is expressly subordinated in
right of payment to or ranks pari passu in right of payment with the Notes or
such Note Guarantor's Note
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Guarantee (the "Initial Lien"), unless contemporaneously therewith effective
provision is made to secure the Indebtedness due under this Indenture and the
Notes or, in respect of Liens on any Restricted Subsidiary's property or assets,
any Note Guarantee of such Restricted Subsidiary, equally and ratably with such
obligation for so long as such obligation is so secured by such Initial Lien.
Any such Lien thereby created in favor of the Notes or any such Note Guarantee
will be automatically and unconditionally released and discharged upon (i) the
release and discharge of the Initial Lien to which it relates, or (ii) any sale,
exchange or transfer to any Person not an Affiliate of the Company of the
property or assets secured by such Initial Lien, or of all of the Capital Stock
held by the Company or any Restricted Subsidiary in, or all or substantially all
the assets of, any Restricted Subsidiary creating such Lien.
Section 4.13 Future Note Guarantors. After the Issue Date, the
Company will cause each Domestic Subsidiary that guarantees payment by the
Company of Bank Indebtedness of the Company to execute and deliver to the
Trustee a supplemental indenture or other instrument pursuant to which such
Subsidiary will guarantee payment of the Notes, whereupon such Subsidiary will
become a Note Guarantor for all purposes under this Indenture. In addition, the
Company may cause any Subsidiary that is not a Note Guarantor so to guarantee
payment of the Notes and become a Note Guarantor.
Section 4.14 Purchase of Notes Upon a Change in Control.
(a) Upon a Change of Control Triggering Event, each Holder will have
the right to require the Company to repurchase all or any part of such Holder's
Notes at a purchase price in cash equal to 101% of the principal amount thereof,
plus accrued and unpaid interest, if any, to the date of repurchase (subject to
Section 3.07); provided, however, that the Company shall not be obligated to
repurchase Notes pursuant to this Section 4.14 in the event that it has
exercised its right to redeem all of the Notes pursuant to Article 10.
(b) In the event that, at the time of such Change of Control
Triggering Event, the terms of the Bank Indebtedness restrict or prohibit the
repurchase of Notes pursuant to this Section 4.14, then prior to the mailing of
the notice to Holders provided for in clause (c) of this Section 4.14 but in any
event not later than 30 days following the date the Company obtains actual
knowledge of any Change of Control Triggering Event (unless the Company has
exercised its right to redeem all the Notes as provided in Article 10), the
Company shall (i) repay in full all Bank Indebtedness or offer to repay in full
all Bank Indebtedness and repay the Bank Indebtedness of each lender who has
accepted such offer or (ii) obtain the requisite consent under the agreements
governing the Bank Indebtedness to permit the repurchase of the Notes as
provided for in clause (c) of this Section 4.14. The Company shall first comply
with the provisions of the immediately preceding sentence before it shall be
required to repurchase Notes pursuant to the provisions of clause (c) of this
Section 4.14. The Company's failure to comply with the provisions of (x) the
first sentence of this clause (b) or (y) clause (c) of this Section 4.14 shall
constitute an Event of Default described in clause (4) and not in clause (2)
under Section 6.01.
(c) Unless the Company has exercised its right to redeem all the
Notes as set forth in Article 10, the Company shall, not later than 30 days
following the date the Company obtains actual knowledge of any Change of Control
Triggering Event having occurred, mail a
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notice to each Holder with a copy to the Trustee stating: (1) that a Change of
Control Triggering Event has occurred or may occur and that such Holder has, or
upon such occurrence will have, the right to require the Company to purchase
such Holder's Notes at a purchase price in cash equal to 101% of the principal
amount thereof, plus accrued and unpaid interest, if any, to the date of
purchase (subject to Section 3.07); (2) the circumstances and relevant facts and
financial information regarding such Change of Control; (3) the repurchase date
(which shall be no earlier than 30 days nor later than 60 days from the date
such notice is mailed); (4) the instructions determined by the Company,
consistent with this Section 4.14, that a Holder must follow in order to have
its Notes purchased; and (5) if such notice is mailed prior to the occurrence of
a Change of Control or Change of Control Triggering Event, that such offer is
conditioned on the occurrence of such Change of Control Triggering Event.
(d) The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Notes pursuant to this
Section 4.14. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 4.14, the Company will
comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this Section 4.14, by virtue
thereof.
ARTICLE 5
SUCCESSOR COMPANY
Section 5.01 When the Company May Merge, etc. The Company will not
consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person, unless:
(i) the resulting, surviving or transferee Person (the "Successor
Company") will be a Person organized and existing under the laws of the
United States of America, any State thereof or the District of Columbia
and the Successor Company (if not the Company) will expressly assume all
the obligations of the Company under the Notes and this Indenture by
executing and delivering to the Trustee a supplemental indenture or one or
more other documents or instruments in form reasonably satisfactory to the
Trustee;
(ii) immediately after giving effect to such transaction (and
treating any Indebtedness that becomes an obligation of the Successor
Company or any Restricted Subsidiary as a result of such transaction as
having been Incurred by the Successor Company or such Restricted
Subsidiary at the time of such transaction), no Default will have occurred
and be continuing;
(iii) immediately after giving effect to such transaction, the
Successor Company could Incur at least $1.00 of additional Indebtedness
pursuant to paragraph (a) of Section 4.06;
(iv) each Note Guarantor (other than any party to any such
consolidation or merger) shall have delivered a supplemental indenture or
other document or instrument in form reasonably satisfactory to the
Trustee, confirming its Note Guarantee; and
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(v) the Company will have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each to the effect that such
consolidation, merger or transfer complies with the provisions described
in this paragraph of this Section 5.01, provided that (x) in giving such
opinion such counsel may rely on an Officer's Certificate as to compliance
with the foregoing clauses (ii) and (iii) and as to any matters of fact,
and (y) no Opinion of Counsel will be required for a consolidation, merger
or transfer described in the last paragraph of this Section 5.01.
Any Indebtedness that becomes an obligation of the Company or any
Restricted Subsidiary (or that is deemed to be Incurred by any Restricted
Subsidiary that becomes a Restricted Subsidiary) as a result of any such
transaction undertaken in compliance with this Section 5.01, and any Refinancing
Indebtedness with respect thereto, shall be deemed to have been Incurred in
compliance with Section 4.06.
Clauses (ii) and (iii) of the first paragraph of this Section 5.01
will not apply to any transaction in which (1) any Restricted Subsidiary
consolidates with, merges into or transfers all or part of its assets to the
Company or (2) the Company consolidates or merges with or into or transfers all
or substantially all its properties and assets to (x) an Affiliate incorporated
or organized for the purpose of reincorporating or reorganizing the Company in
another jurisdiction or changing its legal structure to a corporation or other
entity or (y) a Restricted Subsidiary of the Company so long as all assets of
the Company and the Restricted Subsidiaries immediately prior to such
transaction (other than Capital Stock of such Restricted Subsidiary) are owned
by such Restricted Subsidiary and its Restricted Subsidiaries immediately after
the consummation thereof.
Section 5.02 Successor Company Substituted. Upon any transaction
involving the Company in accordance with Section 5.01, in which the Company is
not the Successor Company, the Successor Company will succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture, and thereafter the predecessor Company shall be relieved of all
obligations and covenants under this Indenture.
ARTICLE 6
REMEDIES
Section 6.01 Events of Default. An "Event of Default" occurs if:
(1) the Company defaults in any payment of interest on any Note when
due, whether or not such payment shall be prohibited by Article 14, and
such default continues for a period of 30 days;
(2) the Company defaults in the payment of the principal of any Note
when the same becomes due at its Stated Maturity, upon optional
redemption, upon required purchase, upon declaration of acceleration or
otherwise, whether or not such payment shall be prohibited by Article 14;
(3) the Company fails to comply with Article 5 and such failure
continues for 30 days after the notice specified in the penultimate
paragraph of this Section 6.01;
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(4) the Company fails to comply with Section 4.14 (other than a
failure to purchase the Notes), and such failure continues for 30 days
after the notice specified in the penultimate paragraph of this Section
6.01;
(5) the Company fails to comply with any of its agreements in the
Notes or this Indenture (other than those referred to in (1), (2), (3) and
(4) above) and such failure continues for 60 days after the notice
specified in the penultimate paragraph of this Section 6.01;
(6) any Note Guarantor fails to comply with its obligations under
any Note Guarantee and such failure continues for 45 days after the notice
specified in the penultimate paragraph of this Section 6.01;
(7) the Company or any Significant Subsidiary fails to pay any
Indebtedness within any applicable grace period after final maturity or
the acceleration of any such Indebtedness by the holders thereof because
of a default if the total amount of such Indebtedness unpaid or
accelerated exceeds $15,000,000 or its foreign currency equivalent;
(8) the Company or any Significant Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:
(H) commences a voluntary case;
(A) consents to the entry of an order for relief against it in
an involuntary case;
(B) consents to the appointment of a Custodian of it or for
any substantial part of its property; or
(C) makes a general assignment for the benefit of its
creditors;
(9) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Subsidiary in an involuntary case;
(B) appoints a Custodian of the Company or any Significant
Subsidiary or for any substantial part of its property; or
(C) orders the winding up or liquidation of the Company or any
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 days;
(10) there is rendered any judgment or decree for the payment of
money in an amount (net of any insurance or indemnity payments actually
received within 90 days
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from the entry thereof, or to be received in respect thereof in the event
any appeal thereof shall be unsuccessful) in excess of $15,000,000 or its
foreign currency equivalent against the Company or any Significant
Subsidiary by a court or other adjudicatory authority of competent
jurisdiction that is not discharged, or bonded or insured by a third
Person, if such judgment or decree remains outstanding for a period of 90
days following such judgment or decree and is not discharged, waived or
stayed;
(11) any Note Guarantee by a Note Guarantor that is a Significant
Subsidiary fails to be in full force and effect (except as contemplated by
the terms thereof or of this Indenture) or any Note Guarantor that is a
Significant Subsidiary denies or disaffirms in writing its obligations
under its Note Guarantee (other than by reason of the termination of this
Indenture or such Note Guarantee or the release of such Note Guarantee in
accordance with such Note Guarantee of this Indenture), if such Default
continues for 10 days; or
(12) Holding fails to consummate the Holding Stock Issuance on or
before December 31, 1999.
The foregoing will constitute Events of Default whatever the reason
for any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means Title 11, United States Code, or any
similar Federal, state or foreign law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
A Default under clause (3), (4), (5) or (6) is not an Event of
Default until the Trustee or the Holders of at least 25% in principal amount of
the Outstanding Notes notify the Company (and the Trustee in the case of a
notice by Holders) of the Default and the Company does not cure such Default
within the time specified therein after receipt of such notice. Such notice must
specify the Default, demand that it be remedied and state that such notice is a
"Notice of Default." When a Default or an Event of Default is cured, it ceases.
The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officer's Certificate of
any Event of Default under clause (7) or (10) and any event that with the giving
of notice or the lapse of time would become an Event of Default under clause
(3), (4), (5) or (6), its status and what action the Company is taking or
proposes to take with respect thereto.
Section 6.02 Acceleration of Maturity; Rescission and Annulment. If
an Event of Default (other than an Event of Default specified in clause (8) or
(9) of Section 6.01 with respect to the Company) occurs and is continuing, the
Trustee by notice to the Company, or the Holders of at least a majority in
principal amount of the outstanding Notes by notice to the Company and the
Trustee, in either case specifying in such notice the respective Event of
Default and that such notice is a "notice of acceleration," may declare the
principal of and accrued but unpaid interest on all the Notes to be due and
payable, provided that so long as any Bank
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Indebtedness shall be outstanding, such acceleration shall not be effective
until the earlier to occur of (x) five Business Days following delivery of a
written notice of such acceleration of the Notes to the Company and the holders
of all Bank Indebtedness or each Representative thereof and (y) the acceleration
of any Bank Indebtedness. Upon the effectiveness of such a declaration, such
principal and interest will be due and payable immediately. Notwithstanding the
foregoing, if an Event of Default specified in clause (8) or (9) of Section 6.01
with respect to the Company occurs and is continuing, then the principal of and
any accrued interest on all the Outstanding Notes will ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder. The Holders of a majority in principal amount of the
Outstanding Notes by notice to the Company and the Trustee may rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default have been cured or
waived except non-payment of principal or interest that has become due solely
because of such acceleration. No such rescission shall affect any subsequent
Default or impair any right consequent thereto.
Notwithstanding the foregoing, in the event of a declaration of
acceleration in respect of the Notes because an Event of Default specified in
clause (7) of Section 6.01 shall have occurred and be continuing, such
declaration of acceleration of the Notes and such Event of Default and all
consequences thereof (including without limitation any acceleration or resulting
payment default) shall be annulled, waived and rescinded, automatically and
without any action by the Trustee or the Holders, and be of no further effect,
if within 60 days after such Event of Default arose (x) the Indebtedness that is
the basis for such Event of Default has been discharged, or (y) the holders
thereof have rescinded or waived the acceleration, notice or action (as the case
may be) giving rise to such Event of Default, or (z) the default in respect of
such Indebtedness that is the basis for such Event of Default has been cured.
Section 6.03 Other Remedies; Collection Suit by Trustee. If an Event
of Default occurs and is continuing, the Trustee may, but is not obligated under
this Section 6.03 to, pursue any available remedy to collect the payment of
principal of or interest on the Notes or to enforce the performance of any
provision of the Notes or this Indenture. If an Event of Default specified in
Section 6.01(1) or 6.01(2) occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Company
for the whole amount then due and owing (together with interest on any unpaid
interest to the extent lawful) and the amounts provided for in Section 7.07.
Section 6.04 Trustee May File Proofs of Claim. The Trustee may file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Holders allowed in
any judicial proceedings relative to the Company or any other obligor upon the
Notes, its creditors or its property and, unless prohibited by law or applicable
regulations, may vote on behalf of the Holders in any election of a trustee in
bankruptcy or other Person performing similar functions, and any Custodian in
any such judicial proceeding is hereby authorized by each Holder to make
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and its counsel, and any other amounts due
the Trustee under Section 7.07.
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No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Notes or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section 6.05 Trustee May Enforce Claims Without Possession of Notes.
All rights of action and claims under this Indenture or the Notes may be
prosecuted and enforced by the Trustee without the possession of any of the
Notes or the production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment shall, after provision for the
payment of the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, be for the ratable benefit of the Holders
of the Notes in respect of which such judgment has been recovered.
Section 6.06 Application of Money Collected. Any money collected by
the Trustee pursuant to this Article 6 shall be applied in the following order,
at the date or dates fixed by the Trustee and, in case of the distribution of
such money on account of principal (or premium, if any) or interest, upon
presentation of the Notes and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:
First: to the payment of all amounts due the Trustee under Section
7.07;
Second: to holders of Senior Indebtedness to the extent required by
Article 14;
Third: to the payment of the amounts then due and unpaid upon the
Notes for principal (and premium, if any) and interest, in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due
and payable on such Notes for principal (and premium, if any) and
interest, respectively; and
Fourth: to the Company.
Section 6.07 Limitation on Suits. No Holder may pursue any remedy
with respect to this Indenture or the Notes unless:
(1) such Holder has previously given the Trustee written notice that
an Event of Default is continuing;
(2) Holders of at least 25% in principal amount of the Outstanding
Notes have requested the Trustee in writing to pursue the remedy;
(3) such Holder or Holders have offered the Trustee reasonable
security or indemnity against any loss, liability or expense;
(4) the Trustee has not complied with such request within 60 days
after receipt of the request and the offer of security or indemnity; and
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(5) the Holders of a majority in principal amount of the Outstanding
Notes have not given the Trustee a direction inconsistent with the request
during such 60-day period.
A Holder may not use this Indenture to affect, disturb or prejudice
the rights of another Holder, to obtain a preference or priority over another
Holder or to enforce any right under this Indenture except in the manner herein
provided and for the equal and ratable benefit of all Holders.
Section 6.08 Unconditional Right of Holders to Receive Principal and
Interest. Notwithstanding any other provision in this Indenture, the Holder of
any Note shall have the absolute and unconditional right to receive payment of
the principal of and all (subject to Section 3.07) interest on such Note on the
respective Stated Maturity or Interest Payment Dates expressed in such Note and
to institute suit for the enforcement of any such payment on or after such
respective Stated Maturity or Interest Payment Dates, and such right shall not
be impaired without the consent of such Holder.
Section 6.09 Restoration of Rights and Remedies. If the Trustee or
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture or any Note and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case the Company, any other obligor upon the
Notes, the Trustee and the Holders shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Trustee and the Holders
shall continue as though no such proceeding had been instituted.
Section 6.10 Rights and Remedies Cumulative. No right or remedy
herein conferred upon or reserved to the Trustee or to the Holders is intended
to be exclusive of any other right or remedy, and every right and remedy shall,
to the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 6.11 Delay or Omission Not Waiver. No delay or omission of
the Trustee or of any Holder of any Note to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article 6 or by law to the Trustee or to
the Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
Section 6.12 Control by Holders. The Holders of not less than a
majority in aggregate principal amount of the Outstanding Notes shall have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or of exercising any trust or power conferred on
the Trustee, provided that
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(1) such direction shall not be in conflict with any rule of law or
with this Indenture, and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture or, subject to Section 7.01, that the
Trustee determines is unduly prejudicial to the rights of other Holders or would
involve the Trustee in personal liability; provided, however, that the Trustee
may take any other action deemed proper by the Trustee that is not inconsistent
with such direction. Prior to taking any action under this Indenture, the
Trustee shall be entitled to indemnification satisfactory to it in its sole
discretion against all losses and expenses caused by taking or not taking such
action. This Section 6.12 shall be in lieu of ss. 316(a)(1)(A) of the TIA, and
such ss. 316(a)(1)(A) of the TIA is hereby expressly excluded from this
Indenture and the Notes, as permitted by the TIA.
Section 6.13 Waiver of Past Defaults. The Holders of not less than a
majority in aggregate principal amount of the Outstanding Notes may on behalf of
the Holders of all the Notes waive any past Default hereunder and its
consequences, except a Default
(1) in the payment of the principal of (or premium, if any) or
interest on any Note (which may only be waived with the consent of each
Holder of Notes affected), or
(2) in respect of a covenant or provision hereof that pursuant to
the second paragraph of Section 9.02 cannot be modified or amended without
the consent of the Holder of each Outstanding Note affected.
Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or Event of Default or impair any right consequent thereon. In
case of any such waiver, the Company, any other obligor upon the Notes, the
Trustee and the Holders shall be restored to their former positions and rights
hereunder and under the Notes, respectively. This paragraph of this Section 6.13
shall be in lieu of ss. 316(a)(1)(B) of the TIA and such ss. 316(a)(1)(B) of the
TIA is hereby expressly excluded from this Indenture and the Notes, as permitted
by the TIA.
Section 6.14 Undertaking for Costs. All parties to this Indenture
agree, and each Holder of any Note by such Holder's acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Indenture or the Notes, or
in any suit against the Trustee for any action taken, suffered or omitted by it
as Trustee, the filing by any party litigant in such suit of an undertaking to
pay the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant. This Section 6.14 shall not
apply to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in principal
amount of the Outstanding Notes, or to any suit instituted by any Holder for the
enforcement of the payment of
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the principal of (or premium, if any) or interest on any Note on or after the
respective Stated Maturity or Interest Payment Dates expressed in such Note.
Section 6.15 Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury or other similar
law wherever enacted, now or at any time hereafter in force, that would prohibit
or forgive the Company from paying all or any portion of the principal of (or
premium, if any) or interest on the Notes contemplated herein or in the Notes or
that may affect the covenants or the performance of this Indenture; and the
Company (to the extent that it may lawfully do so) hereby expressly waives all
benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.
ARTICLE 7
THE TRUSTEE
Section 7.01 Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture; but
in the case of any such certificates or opinions that by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether or
not they conform to the requirements of this Indenture, but need not
verify the contents thereof.
(e) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(f) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that (i) this paragraph does not
limit the effect of paragraph (a) of this Section 7.01; (ii) the Trustee shall
not be liable for any error of judgment made in good faith by a Trust Officer,
unless it is proved that the Trustee was negligent in ascertaining the pertinent
facts; and (iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction received by
it pursuant to Section 6.12.
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(g) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(h) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of
Sections 7.01 and 7.03.
Section 7.02 Notice of Defaults. Within 90 days after the occurrence
of any Default, the Trustee shall transmit by mail to all Holders, as their
names and addresses appear in the Note Register, notice of such Default
hereunder known to the Trustee unless such Default shall have been cured or
waived; provided, however, that, except in the case of a Default in the payment
of the principal of, premium, if any, or interest on any Note, the Trustee shall
be protected in withholding such notice if and so long as a committee of Trust
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders.
Section 7.03 Certain Rights of Trustee. Subject to the provisions of
Section 7.01:
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(2) any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order thereof,
and any resolution of any Person's board of directors shall be
sufficiently evidenced if certified by an Officer of such Person as having
been duly adopted and being in full force and effect on the date of such
certificate;
(3) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon an Officer's Certificate of the Company;
(4) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or
direction of any of the Holders pursuant to this Indenture, unless such
Holders shall have offered to the Trustee
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reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request
or direction;
(6) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, note, other evidence of indebtedness or other paper or document; and
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
Section 7.04 Not Responsible for Recitals or Issuance of Notes. The
recitals contained herein and in the Notes, except the Trustee's certificates of
authentication, shall be taken as the statements of the Company and any other
obligor upon the Notes, and neither the Trustee nor any Authenticating Agent
assumes any responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Notes, except that the Trustee represents that it is duly authorized to execute
and deliver this Indenture, authenticate the Notes and perform its obligations
hereunder and that the statements made by it in a Statement of Eligibility and
Qualification on Form T-1 supplied to the Company and any other obligor upon the
Notes in connection with the registration of any Notes and any Note Guarantees
issued hereunder are and will be true and accurate subject to the qualifications
set forth therein. Neither the Trustee nor any Authenticating Agent shall be
accountable for the use or application by the Company of Notes or the proceeds
thereof.
Section 7.05 May Hold Notes. The Trustee, any Authenticating Agent,
any Paying Agent, any Note Registrar or any other agent of the Company, in its
individual or any other capacity, may become the owner or pledgee of Notes and,
subject to Section 7.08 and Section 7.13, may otherwise deal with the Company or
its Affiliates with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Note Registrar or such other agent.
Section 7.06 Money Held in Trust. Money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required
by law. The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed with the Company.
Section 7.07 Compensation and Reimbursement. The Company agrees,
(1) to pay to the Trustee from time to time reasonable compensation
for all services rendered by the Trustee hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation
of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable out-of-pocket expenses
incurred by the Trustee in accordance with any provision of this Indenture
(including the reasonable compensation
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and the expenses and disbursements of its agents and counsel), except any
such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against,
any loss, liability or expense incurred without negligence or bad faith on
the Trustee's part, arising out of or in connection with the
administration of the trust or trusts hereunder, including the costs and
expenses of defending itself against any claim or liability in connection
with the exercise or performance of any of its powers or duties hereunder.
The Company need not pay for any settlement made without its consent.
Section 7.08 Conflicting Interests. If the Trustee has or shall
acquire a conflicting interest within the meaning of the TIA, the Trustee shall
either eliminate such interest, apply to the SEC for permission to continue as
Trustee with such conflicting interest or resign, to the extent and in the
manner provided by, and subject to the provisions of, the TIA and this
Indenture. To the extent permitted by such Act, the Trustee shall not be deemed
to have a conflicting interest by virtue of being a trustee under this Indenture
with respect to Original Notes and Additional Notes, or a trustee under any
other indenture between the Company and the Trustee.
Section 7.09 Corporate Trustee Required; Eligibility. There shall at
all times be one (and only one) Trustee hereunder. The Trustee shall be a Person
that is eligible pursuant to the TIA to act as such and has a combined capital
and surplus of at least $50,000,000. If any such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then for the purposes of this Section 7.09
and to the extent permitted by the TIA, the combined capital and surplus of such
Person shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section
7.09, it shall resign immediately in the manner and with the effect hereinafter
specified in this Article.
Section 7.10 Resignation and Removal; Appointment of Successor. No
resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 7.11.
The Trustee may resign at any time by giving written notice thereof
to the Company. If the instrument of acceptance by a successor Trustee required
by Section 7.11 shall not have been delivered to the Trustee within 30 days
after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Notes, delivered to the Trustee
and to the Company.
If at any time:
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(1) the Trustee shall fail to comply with Section 7.08 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Note for at least six months, or
(2) the Trustee shall cease to be eligible under Section 7.09 and
shall fail to resign after written request therefor by the Company or by
any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Company may remove the Trustee, or (B) subject
to Section 6.14, any Holder who has been a bona fide Holder of a Note for at
least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company shall promptly appoint a successor Trustee and shall comply with the
applicable requirements of Section 7.11. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Notes delivered to the Company and the
retiring Trustee, the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment in accordance with the applicable requirements of
Section 7.11, become the successor Trustee and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee shall have
been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 7.11, then, subject to Section 6.14, any Holder who
has been a bona fide Holder of a Note for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee.
The Company shall give notice of each resignation and each removal
of the Trustee and each appointment of a successor Trustee to all Holders in the
manner provided in Section 1.10. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.
Section 7.11 Acceptance of Appointment by Successor. In case of the
appointment hereunder of a successor Trustee, every such successor Trustee so
appointed shall execute, acknowledge and deliver to the Company and to the
retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee;
but, on the request of the Company or the successor Trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder.
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Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to above.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article 7.
Section 7.12 Merger, Conversion, Consolidation or Succession to
Business. Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article 7,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Notes shall have been authenticated, but
not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Notes so authenticated with the same effect as if
such successor Trustee had itself authenticated such Notes.
Section 7.13 Preferential Collection of Claims Against the Company.
If and when the Trustee shall be or become a creditor of the Company (or any
other obligor upon the Notes), the Trustee shall be subject to the provisions of
the TIA regarding the collection of claims against the Company (or any such
other obligor).
Section 7.14 Appointment of Authenticating Agent. The Trustee may
appoint an Authenticating Agent acceptable to the Company to authenticate the
Notes. Any such appointment shall be evidenced by an instrument in writing
signed by a Trust Officer, a copy of which instrument shall be promptly
furnished to the Company. Unless limited by the terms of such appointment, an
Authenticating Agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication (or execution of a certificate of
authentication) by the Trustee includes authentication (or execution of a
certificate of authentication) by such Authenticating Agent. An Authenticating
Agent has the same rights as any Registrar, Paying Agent or agent for service of
notices and demands.
ARTICLE 8
HOLDERS' LISTS AND REPORTS BY
TRUSTEE AND THE COMPANY
Section 8.01 The Company to Furnish Trustee Names and Addresses of
Holders. The Company will furnish or cause to be furnished to the Trustee
(1) semi-annually, not more than 15 days after each Regular Record
Date, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders as of such Regular Record Date, and
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(2) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a
list of similar form and content as of a date not more than 15 days prior
to the time such list is furnished;
provided, however, that if and so long as the Trustee shall be the Note
Registrar, no such list need be furnished pursuant to this Section 8.01.
Section 8.02 Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably practicable,
the names and addresses of Holders contained in the most recent list, if any,
furnished to the Trustee as provided in Section 8.01 and the names and addresses
of Holders received by the Trustee in its capacity as Note Registrar; provided,
however, that if and so long as the Trustee shall be the Note Registrar, the
Note Register shall satisfy the requirements relating to such list. None of
Holding, the Company, any other obligor upon the Notes or the Trustee or any
other Person shall be under any responsibility with regard to the accuracy of
such list. The Trustee may destroy any list furnished to it as provided in
Section 8.01 upon receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect
to their rights under this Indenture or under the Notes, and the corresponding
rights and privileges of the Trustee, shall be as provided by the TIA.
Every Holder of Notes, by receiving and holding the same, agrees
with the Company and the Trustee that neither the Company nor the Trustee nor
any agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of Holders made pursuant to
the TIA.
Section 8.03 Reports by Trustee. The Trustee shall transmit to
Holders such reports concerning the Trustee and its actions under this Indenture
as may be required pursuant to the TIA at the times and in the manner provided
pursuant thereto. A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which any Notes are listed, with the SEC and with the Company. The Company will
notify the Trustee when any Notes are listed on any stock exchange.
ARTICLE 9
AMENDMENT, SUPPLEMENT OR WAIVER
Section 9.01 Without Consent of Holders. Without the consent of the
Holders of any Notes the Company, the Trustee and (as applicable) any Note
Guarantor may enter into one or more indentures supplemental hereto, for any of
the following purposes:
(1) to cure any ambiguity, omission, defect or inconsistency,
(2) to provide for the assumption by a successor of the obligations
of the Company under this Indenture,
(3) to provide for uncertificated Notes in addition to or in place
of certificated Notes,
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(4) to add Guarantees with respect to the Notes, to secure the
Notes, to confirm and evidence the release, termination or discharge of
any Guarantee or Lien with respect to or securing the Notes when such
release, termination or discharge is provided for under this Indenture,
(5) to add to the covenants of the Company for the benefit of the
Noteholders or to surrender any right or power conferred upon the Company,
(6) to provide that any Indebtedness that becomes or will become an
obligation of a Successor Company or a Note Guarantor pursuant to a
transaction governed by Article 5 (and that is not a Subordinated
Obligation) is Senior Subordinated Indebtedness or Guarantor Senior
Subordinated Indebtedness for purposes of this Indenture,
(7) to provide for or confirm the issuance of Additional Notes,
(8) to make any change that does not adversely affect the rights of
any Holder under the Notes or this Indenture, or
(9) to comply with any requirement of the SEC in connection with the
qualification of this Indenture under the TIA or otherwise.
Section 9.02 With Consent of Holders. Subject to Section 6.08, the
Company, the Trustee and (if applicable) any Note Guarantor may amend or
supplement this Indenture or the Notes with the written consent of the Holders
of not less than a majority in aggregate principal amount of the Outstanding
Notes (including consents obtained in connection with a tender offer or exchange
offer for Notes), and the Holders of not less than a majority in aggregate
principal amount of the Outstanding Notes by written notice to the Trustee
(including consents obtained in connection with a tender offer or exchange offer
for Notes) may waive any existing Default or Event of Default or compliance by
the Company or any Note Guarantor with any provision of this Indenture, the
Notes or any Note Guarantee.
Notwithstanding the provisions of this Section 9.02, without the
consent of each Holder affected, an amendment or waiver, including a waiver
pursuant to Section 6.13, may not:
(i) reduce the principal amount of the Notes whose Holders must
consent to an amendment or waiver;
(ii) reduce the rate of or extend the time for payment of interest
on any Note;
(iii) reduce the principal or extend the Stated Maturity of any
Note;
(iv) reduce the premium payable upon the redemption of any Note or
change the date on which any Note may be redeemed as described in Section
10.01;
(v) make any Note payable in money other than that stated in the
Note;
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(vi) make any change in Article 14 or Article 15 that adversely
affects the rights of any Holder in any material respect;
(vii) impair the right of any Holder to receive payment of principal
of and interest on such Holder's Notes on or after the due dates therefor
or to institute suit for the enforcement of any payment on or with respect
to such Holder's Notes; or
(viii) make any change in the amendment or waiver provisions
described in this sentence.
Notwithstanding Section 9.01 and the foregoing provisions of this
Section 9.02, no amendment to Article 14 or Article 15 of this Indenture or the
definitions relating thereto that adversely affects the rights of any Holder of
Senior Indebtedness at the time outstanding (which Senior Indebtedness has been
previously designated in writing by the Company to the Trustee for this purpose)
may be made unless the holders of such Senior Indebtedness (or any group or
representative thereof authorized to give a consent) consent in writing to such
amendment.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders of each Note affected
thereby, with a copy to the Trustee, a notice briefly describing the amendment,
supplement or waiver. Any failure of the Company to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any supplemental indenture or effectiveness of any such amendment, supplement or
waiver.
Section 9.03 Execution of Amendments, Supplements or Waivers. The
Trustee shall sign any amendment, supplement or waiver authorized pursuant to
this Article 9 if the amendment, supplement or waiver does not adversely affect
the rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, sign it. In signing or refusing to sign such
amendment, supplement or waiver, the Trustee shall be entitled to receive, and
shall be fully protected in relying upon, an Officer's Certificate and an
Opinion of Counsel to the effect that the execution of such amendment,
supplement or waiver has been duly authorized, executed and delivered by the
Company and that, subject to applicable bankruptcy, insolvency, fraudulent
transfer, fraudulent conveyance, reorganization, moratorium and other laws now
or hereinafter in effect affecting creditors' rights or remedies generally and
the general principles of equity (including, without limitation, standards of
materiality, good faith, fair dealing and reasonableness), whether considered in
a proceeding at law or at equity, such amendment, supplement or waiver is a
valid and binding agreement of the Company, enforceable against it in accordance
with its terms.
Section 9.04 Revocation and Effect of Consents. Until an amendment,
supplement or waiver becomes effective, a consent to it by a Holder is a
continuing consent by the Holder and every subsequent Holder of that Note or any
Note that evidences all or any part of the same debt as the consenting Holder's
Note, even if notation of the consent is not made on
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any Note. Subject to the following paragraph of this Section 9.04, any such
Holder or subsequent Holder may revoke the consent as to such Holder's Note by
notice to the Trustee or the Company received by the Trustee or the Company, as
the case may be, before the date on which the Trustee receives an Officer's
Certificate certifying that the Holders of the requisite principal amount of
Notes have consented (and not theretofore revoked such consent) to the
amendment, supplement or waiver. The Company may, but shall not be obligated to,
fix a record date for the purpose of determining the Holders entitled to consent
to any amendment, supplement or waiver as set forth in Section 1.08.
After an amendment, supplement or waiver becomes effective, it shall
bind every Holder of Notes, unless it makes a change described in any of clauses
(i) through (viii) of the second paragraph of Section 9.02. In that case, the
amendment, supplement or waiver shall bind each Holder of a Note who has
consented to it and every subsequent Holder of such Note or any Note that
evidences all or any part of the same debt as the consenting Holder's Note.
Section 9.05 Conformity with TIA. Every amendment or supplemental
indenture executed pursuant to this Article shall conform to the requirements of
the TIA as then in effect.
Section 9.06 Notation on or Exchange of Notes. If an amendment,
supplement or waiver changes the terms of a Note, the Trustee shall (if required
by the Company and in accordance with the specific direction of the Company)
request the Holder of the Note to deliver it to the Trustee. The Trustee shall
(if required by the Company and in accordance with the specific direction of the
Company) place an appropriate notation on the Note about the changed terms and
return it to the Holder. Alternatively, if the Company or the Trustee so
determines, the Company in exchange for the Note shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms. Failure to make
the appropriate notation or issue a new Note shall not affect the validity and
effect of such amendment, supplement or waiver.
ARTICLE 10
REDEMPTION OF NOTES
Section 10.01 Right of Redemption.
(a) Except as set forth in this Section 10.01, the Notes will not be
redeemable at the option of the Company prior to December 1, 2004. Thereafter,
the Notes will be redeemable, at the Company's option, in whole or in part, and
from time to time on and after December 1, 2004 and prior to maturity. Such
redemption may be made upon notice mailed by first-class mail to each Holder's
registered address in accordance with Section 10.05. The Notes will be so
redeemable at the following Redemption Prices (expressed as a percentage of
principal amount), plus accrued interest, if any, to the relevant Redemption
Date (subject to Section 3.07), if redeemed during the 12-month period
commencing on December 1 of the years set forth below:
Redemption
Period Price
------ -------
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2004...................... 106.688%
2005...................... 104.458%
2006...................... 102.229%
2007 and thereafter....... 100.000%
(b) In addition, at any time and from time to time prior to December
1, 2002, the Company at its option may redeem Notes in an aggregate principal
amount equal to up to 35% of the original aggregate principal amount of the
Notes (including the principal amount of any Additional Notes), with funds in an
aggregate amount (the "Redemption Amount") not exceeding the aggregate cash
proceeds of one or more Equity Offerings, at a Redemption Price (expressed as a
percentage of principal amount thereof) of 113.375% plus accrued interest, if
any, to the Redemption Date (subject to Section 3.07); provided, however, that
an aggregate principal amount of the Notes equal to at least 65% of the original
aggregate principal amount of the Notes (including the principal amount of any
Additional Notes) must remain outstanding after each such redemption. The
Company may make such redemption upon notice mailed by first-class mail to each
Holder's registered address in accordance with Section 10.05 (but in no event
more than 180 days after the completion of the related Equity Offering).
Section 10.02 Applicability of Article. Redemption of Notes as
permitted by Section 10.01 shall be made in accordance with this Article 10.
Section 10.03 Election to Redeem; Notice to Trustee. In case of any
redemption at the election of the Company of less than all of the Notes, the
Company shall, at least 30 days prior to the Redemption Date initially fixed by
the Company (unless a shorter notice shall be satisfactory to the Trustee),
notify the Trustee of such Redemption Date and of the principal amount of Notes
to be redeemed.
Section 10.04 Selection by Trustee of Notes to Be Redeemed. In the
case of any partial redemption, selection of the Notes for redemption will be
made not more than 60 days prior to the Redemption Date by the Trustee on a pro
rata basis, by lot or by such other method as the Trustee in its sole discretion
shall deem to be fair and appropriate, although no Note of $1,000 in original
principal amount or less will be redeemed in part.
The Trustee shall promptly notify the Company in writing of the
Notes selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. On and after the
Redemption Date, interest will cease to accrue on Notes or portions thereof
called for redemption.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Notes shall relate, in
the case of any Note redeemed or to be redeemed only in part, to the portion of
the principal of such Note that has been or is to be redeemed.
Section 10.05 Notice of Redemption. Notice of redemption as provided
in Section 10.01 shall be given by first class mail, postage prepaid, mailed not
less than 30 nor more than 60 days prior to the Redemption Date, to each Holder
of Notes to be redeemed, at such Holder's address appearing in the Note
Register.
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Any such notice shall state:
(1) the expected Redemption Date,
(2) the Redemption Price,
(3) if less than all Outstanding Notes are to be redeemed, the
identification (and, in the case of partial redemption, the respective
principal amounts) of the Notes to be redeemed,
(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Note, and that, unless the Company defaults in
making such redemption payment or the Paying Agent is prohibited from
making such payment pursuant to the terms of this Indenture, interest
thereon shall cease to accrue from and after said date, and
(5) the place where such Notes are to be surrendered for payment of
the Redemption Price.
Notice of such redemption of Notes to be so redeemed at the election
of the Company shall be given by the Company or, at the Company's request, by
the Trustee in the name and at the expense of the Company.
The notice if mailed in the manner herein provided shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Note designated for redemption as a whole or in
part shall not affect the validity of the proceedings for the redemption of any
other Note.
Section 10.06 Deposit of Redemption Price. On or prior to any
Redemption Date, the Company shall deposit with the Trustee or with a Paying
Agent (or, if the Company is acting as its own Paying Agent, the Company shall
segregate and hold in trust as provided in Section 4.03) an amount of money
sufficient to pay the Redemption Price of, and any accrued and unpaid interest
on, all the Notes or portions thereof which are to be redeemed on that date.
Section 10.07 Notes Payable on Redemption Date. Notice of redemption
having been given as provided in this Article 10, the Notes so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
herein specified and from and after such date (unless Company shall default in
the payment of the Redemption Price or the Paying Agent is prohibited from
paying the Redemption Price pursuant to the terms of this Indenture) such Notes
shall cease to bear interest. Upon surrender of such Notes for redemption in
accordance with such notice, such Notes shall be paid by the Company at the
Redemption Price. Installments of interest whose Interest Payment Date is on or
prior to the Redemption Date shall be payable to the Holders of such Notes
registered as such on the relevant Regular Record Dates according to their terms
and the provisions of Section 3.07.
On and after any Redemption Date, if money sufficient to pay the
Redemption Price of and any accrued and unpaid interest on Notes called for
redemption shall have been
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made available in accordance with Section 10.06, the Notes (or the portions
thereof) called for redemption will cease to accrue interest and the only right
of the Holders of such Notes (or portions thereof) will be to receive payment of
the Redemption Price of and subject to the last sentence of the preceding
paragraph of this Section 10.07, any accrued and unpaid interest on such Notes
(or portions thereof) to the Redemption Date. If any Note (or portion thereof)
called for redemption shall not be so paid upon surrender thereof for
redemption, the principal (and premium, if any) shall, until paid, bear interest
from the Redemption Date at the rate borne by the Note (or portion thereof).
Section 10.08 Notes Redeemed in Part. Any Note that is to be
redeemed only in part shall be surrendered at the Place of Payment (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing) and the
Company shall execute and the Trustee shall authenticate and deliver to the
Holder of such Note without service charge, a new Note or Notes, of any
authorized denomination as requested by such Holder in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Note so surrendered.
ARTICLE 11
SATISFACTION AND DISCHARGE
Section 11.01 Satisfaction and Discharge of Indenture. This
Indenture shall cease to be of further effect (except as to any surviving rights
of registration or transfer or exchange of Notes herein expressly provided for),
and the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture,
when
(1) either
(I) all Notes theretofore authenticated and delivered (other
than (i) Notes that have been destroyed, lost or stolen and that
have been replaced or paid as provided in Section 3.06, and (ii)
Notes for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as provided in
Section 4.03) have been delivered to the Trustee cancelled or for
cancellation; or
(A) all such Notes not theretofore delivered to the Trustee
cancelled or for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
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(iii) are to be called for redemption within one year under
arrangements reasonably satisfactory to the Trustee for the giving of
notice of redemption by the Trustee in the name, and at the expense, of
the Company,
(2) the Company has irrevocably deposited or caused to be deposited
with the Trustee an amount in money, U.S. Government Obligations, or a
combination thereof, sufficient to pay and discharge the entire
Indebtedness on such Notes not theretofore delivered to the Trustee
cancelled or for cancellation, for principal of, and premium (if any) and
interest to the date of such deposit (in the case of Notes that have
become due and payable), or to the Stated Maturity or Redemption Date, as
the case may be;
(3) the Company has paid or caused to be paid all other sums then
payable hereunder by the Company; and
(4) the Company has delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel each to the effect that all
conditions precedent provided for in this Section 11.01 relating to the
satisfaction and discharge of this Indenture have been complied with,
provided that any such counsel may rely on any Officer's Certificate as to
matters of fact (including as to compliance with the foregoing clauses
(1), (2) and (3)).
Notwithstanding the satisfaction and discharge of this Indenture,
the obligations of the Company to the Trustee under Section 7.07 and, if money
shall have been deposited with the Trustee pursuant to clause (2) of this
Section 11.01, the obligations of the Trustee under Section 11.02, shall
survive.
Section 11.02 Application of Trust Money. Subject to the provisions
of the last paragraph of Section 4.03, all money deposited with the Trustee
pursuant to Section 11.01 shall be held in trust and applied by it, in
accordance with the provisions of the Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company acting as its
own Paying Agent) as the Trustee may determine, to the Persons entitled thereto,
of the principal (and premium, if any) and interest on the Notes; but such money
need not be segregated from other funds except to the extent required by law.
ARTICLE 12
DEFEASANCE OR COVENANT DEFEASANCE
Section 12.01 The Company's Option to Elect Defeasance or Covenant
Defeasance. The Company may, at its option, at any time, elect to have
terminated the obligations of the Company with respect to the Outstanding Notes
and to have terminated the obligations of any or all Note Guarantors with
respect to the Note Guarantees, in each case as set forth in this Article 12,
and elect to have either Section 12.02 or Section 12.03 be applied to all of the
Outstanding Notes (the "Defeased Notes"), upon compliance with the conditions
set forth in Section 12.04. Either Section 12.02 or Section 12.03 may be applied
to the Defeased Notes to any Redemption Date or the Stated Maturity of the
Notes.
Section 12.02 Defeasance and Discharge. Upon the Company's exercise
under Section 12.01 of the option applicable to this Section 12.02, the Company
shall be deemed to
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have been released and discharged from its obligations with respect to the
Defeased Notes on the date the relevant conditions set forth in Section 12.04
below are satisfied (hereinafter, "Defeasance"). For this purpose, such
Defeasance means that the Company shall be deemed to have paid and discharged
the entire indebtedness represented by the Defeased Notes, which shall
thereafter be deemed to be "Outstanding" only for the purposes of Section 12.05
and the other Sections of this Indenture referred to in clauses (a) and (b)
below, and the Company and each of the Note Guarantors shall be deemed to have
satisfied all other obligations under such Notes and this Indenture insofar as
such Notes are concerned (and the Trustee, at the expense of the Company, shall
execute proper instruments acknowledging the same), except for the following,
which shall survive until otherwise terminated or discharged hereunder: (a) the
rights of Holders of Defeased Notes to receive, solely from the trust fund
described in Section 12.04 and as more fully set forth in such Section, payments
in respect of the principal of and premium, if any, and interest on such Notes
when such payments are due, (b) the Company's obligations with respect to such
Defeased Notes under Sections 3.04, 3.05, 3.06, 4.02 and 4.03, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder, including the
Trustee's rights under Section 7.07, and (d) this Article 12. Subject to
compliance with this Article 12, the Company may, at its option and at any time,
exercise its option under this Section 12.02 notwithstanding the prior exercise
of its option under Section 12.03 with respect to the Notes.
Section 12.03 Covenant Defeasance. Upon the Company's exercise under
Section 12.01 of the option applicable to this Section 12.03, (a) the Company
and any Note Guarantors shall be released from their respective obligations
under any covenant or provision contained in Section 4.04 and Sections 4.06
through 4.14 and the provisions of clauses (iii), (iv) and (v) of Section 5.01
shall not apply, and (b) the occurrence of any event specified in clause (3)
(with respect to clauses (iii), (iv) and (v) of Section 5.01), (4) or (5) (with
respect to Section 4.04, Sections 4.06 through 4.14, inclusive, and any such
covenants provided pursuant to Section 9.01(5)), inclusive, (6), (7), (8) or (9)
(with respect to Subsidiaries), (10) or (11) of Section 6.01 shall be deemed not
to be or result in an Event of Default, in each case with respect to the
Defeased Notes on and after the date the conditions set forth below are
satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall thereafter
be deemed not to be "Outstanding" for the purposes of any direction, waiver,
consent or declaration or Act of Holders (and the consequences of any thereof)
in connection with such covenants or provisions, but shall continue to be deemed
"Outstanding" for all other purposes hereunder. For this purpose, such Covenant
Defeasance means that, with respect to the Outstanding Notes, the Company and
any Note Guarantors may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such covenant or
provision, whether directly or indirectly, by reason of any reference elsewhere
herein to any such covenant or provision or by reason of any reference in any
such covenant or provision to any other provision herein or in any other
document and such omission to comply shall not constitute a Default or an Event
of Default under Section 6.01, but, except as specified above, the remainder of
this Indenture and such Outstanding Notes shall be unaffected thereby.
Section 12.04 Conditions to Defeasance or Covenant Defeasance. The
following shall be the conditions to application of either Section 12.02 or
Section 12.03 to the Outstanding Notes:
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(1) The Company shall have irrevocably deposited or caused to be
deposited with the Trustee in trust money, U.S. Government Obligations or
a combination thereof, in amounts as will be sufficient, in the opinion of
a nationally recognized accounting or investment banking firm expressed in
a written certification thereof delivered to the Trustee, to pay and
discharge the principal of, and premium, if any, and interest on the
Defeased Notes on the Stated Maturity or relevant Redemption Date in
accordance with the terms of this Indenture and the Notes;
(2) No Default or Event of Default shall have occurred and be
continuing on the date of such deposit or, insofar as Section 6.01(8) or
6.01(9) is concerned, at any time during the period ending on the
ninety-first day after the date of such deposit;
(3) Such deposit shall not result in a breach or violation of, or
constitute a Default or Event of Default under, this Indenture or any
other material agreement or instrument to which the Company is a party or
by which it is bound;
(4) In the case of an election under Section 12.02, the Company
shall have delivered to the Trustee an Opinion of Counsel from Debevoise &
Plimpton or other counsel to the effect that (x) the Company has received
from, or there has been published by, the Internal Revenue Service a
ruling or (y) since the Issue Date, there has been a change in the
applicable Federal income tax law, in either case to the effect that, and
based thereon such opinion shall confirm to the effect that, the Holders
of the Outstanding Notes will not recognize income, gain or loss for
Federal income tax purposes as a result of such Defeasance and will be
subject to Federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such Defeasance had not
occurred;
(5) In the case of an election under Section 12.03, the Company
shall have delivered to the Trustee an Opinion of Counsel from Debevoise &
Plimpton or other counsel to the effect that the Holders of the
Outstanding Notes will not recognize income, gain or loss for Federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to Federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such Covenant Defeasance
had not occurred; and
(6) The Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each to the effect that all
conditions precedent provided for in this Section 12.04 relating to either
the Defeasance under Section 12.02 or the Covenant Defeasance under
Section 12.03, as the case may be, have been complied with. In rendering
such Opinion of Counsel, counsel may rely on any Officer's Certificate as
to compliance with the foregoing clauses (1), (2) and (3) of this Section
12.04 or as to any matters of fact.
From and after the time of any deposit pursuant to clause (1) of the
first paragraph of this Section 12.04, the money or U.S. Government Obligations
so deposited shall not be subject to the rights of the holders of Senior
Indebtedness or Guarantor Senior Indebtedness pursuant to the subordination
provisions of Article 14 or Article 15.
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Section 12.05 Deposited Money and U.S. Government Obligations To Be
Held in Trust; Other Miscellaneous Provisions. Subject to the provisions of the
last paragraph of Section 4.03, all money and U.S. Government Obligations
(including the proceeds thereof) deposited with the Trustee (or such other
Person that would qualify to act as successor trustee under Article 7,
collectively and solely for purposes of this Section 12.05, Section 14.12 and
Section 15.12, the "Trustee") pursuant to Section 12.04 in respect of the
Defeased Notes shall be held in trust and applied by the Trustee, in accordance
with the provisions of such Notes and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the Holders of such Notes of all
sums due and to become due thereon in respect of principal, premium, if any, and
interest, but such money need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee and its agents and
hold them harmless against any tax, fee or other charge imposed on or assessed
against the U.S. Government Obligations deposited pursuant to Section 12.04 or
the principal, premium, if any, and interest received in respect thereof, other
than any such tax, fee or other charge that by law is for the account of the
Holders of the Defeased Notes.
Anything in this Article 12 to the contrary notwithstanding, the
Trustee shall deliver to the Company from time to time upon Company Request any
money or U.S. Government Obligations held by it as provided in Section 12.04
that, in the opinion of a nationally recognized accounting or investment banking
firm expressed in a written certification thereof to the Trustee, are in excess
of the amount thereof that would then be required to be deposited to effect an
equivalent Defeasance or Covenant Defeasance. Subject to Article 7, the Trustee
shall not incur any liability to any Person by relying on such opinion.
Section 12.06 Reinstatement. If the Trustee or Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with
Section 12.02 or 12.03, as the case may be, by reason of any order or judgment
of any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the obligations of the Company and any other
obligor upon the Notes under this Indenture, the Notes and any Note Guarantees
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 12.02 or 12.03, as the case may be, until such time as the Trustee or
Paying Agent is permitted to apply all such money and U.S. Government
Obligations in accordance with Section 12.02 or 12.03, as the case may be;
provided, however, that if either the Company and any other obligor upon the
Notes makes any payment of principal, premium, if any, or interest on any Note
following the reinstatement of its obligations, then the Company and any other
obligor upon the Notes shall be subrogated to the rights of the Holders of such
Notes to receive such payment from the money and U.S. Government Obligations
held by the Trustee or Paying Agent.
Section 12.07 Repayment to the Company. The Trustee shall pay to the
Company upon Company Request any money held by it for the payment of principal
or interest that remains unclaimed for two years. After payment to the Company,
Holders entitled to money must look to the Company for payment as general
creditors unless an applicable abandoned property law designates another Person
and all liability of the Trustee or Paying Agent with respect to such money
shall thereupon cease.
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ARTICLE 13
NOTE GUARANTEES
Section 13.01 Guarantees Generally.
(a) (i) Any Note Guarantor from time to time party hereto, as
primary obligor and not merely as surety, hereby jointly and
severally, irrevocably and fully and unconditionally Guarantees, on
a senior subordinated basis, the punctual payment when due, whether
at Stated Maturity, by acceleration or otherwise, of all monetary
obligations of the Company under this Indenture and the Notes,
whether for principal of or interest on the Notes, expenses,
indemnification or otherwise (all such obligations guaranteed by
such Note Guarantors being herein called the "Guaranteed
Obligations").
(ii) Any term or provision of this Indenture notwithstanding,
the obligations of each Note Guarantor under its Note Guarantee
shall not exceed the maximum amount, as will, after giving effect to
all other contingent and fixed liabilities of such Note Guarantor,
result in the obligations of such Note Guarantor under the Note
Guarantee not constituting a fraudulent conveyance or fraudulent
transfer under applicable law, or being void or unenforceable under
any applicable law, including any law relating to insolvency of
debtors.
(b) Further Agreements of any Note Guarantor. (i) Any Note Guarantor
from time to time party hereto hereby agrees that (to the fullest extent
permitted by law) its obligations hereunder shall be unconditional, irrespective
of the validity, regularity or enforceability of this Indenture, the Notes or
the obligations of the Company or any Note Guarantor to the Holders or the
Trustee hereunder or thereunder, the absence of any action to enforce the same,
any waiver or consent by any Holder with respect to any provisions hereof or
thereof, any release of any other Note Guarantor, the recovery of any judgment
against the Company, any action to enforce the same, whether or not a notation
concerning its Note Guarantee is made on any particular Note, or any other
circumstance that might otherwise constitute a legal or equitable discharge or
defense of a guarantor.
(ii) Each Note Guarantor hereby waives (to the fullest extent
permitted by law) the benefit of diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against
the Company, protest, notice and all demands whatsoever and covenants that
(except as otherwise provided in Section 13.03) its Note Guarantee will
not be discharged except by complete performance of the obligations
contained in the Notes, this Indenture, and its Note Guarantee. Such Note
Guarantee is a guarantee of payment and not of collection. Each Note
Guarantor further agrees (to the fullest extent permitted by law) that, as
between it, on the one hand, and the Holders of Notes and the Trustee, on
the other hand, subject to this Article 13 and Article 15, (1) the
maturity of the obligations guaranteed by its Note Guarantee may be
accelerated as and to the extent provided in Article 6 for the purposes of
such Note Guarantee notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations
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guaranteed by such Note Guarantee and (2) in the event of any acceleration
of such obligations as provided in Article 6, such obligations (whether or
not due and payable) shall forthwith become due and payable by such
Guarantor in accordance with the terms of this Section 13.01 for the
purpose of such Note Guarantee. Neither the Trustee nor any other Person
shall have any obligation to enforce or exhaust any rights or remedies or
to take any other steps under any security for the Guaranteed Obligations
or against the Company or any other Person or any property of the Company
or any other Person before the Trustee is entitled to demand payment and
performance by any or all Note Guarantors of their obligations under their
respective Note Guarantees or under this Indenture.
(iii) Until terminated in accordance with Section 13.03, any Note
Guarantee shall remain in full force and effect and continue to be
effective should any petition be filed by or against the Company for
liquidation or reorganization, should the Company become insolvent or make
an assignment for the benefit of creditors or should a receiver or trustee
be appointed for all or any significant part of the Company's assets, and
shall, to the fullest extent permitted by law, continue to be effective or
be reinstated, as the case may be, if at any time payment and performance
of the Notes are, pursuant to applicable law, rescinded or reduced in
amount, or must otherwise be restored or returned by any obligee on such
Notes, whether as a "voidable preference," "fraudulent transfer" or
otherwise, all as though such payment or performance had not been made. In
the event that any payment, or any part thereof, is rescinded, reduced,
restored or returned, the Notes shall, to the fullest extent permitted by
law, be reinstated and deemed reduced only by such amount paid and not so
rescinded, reduced, restored or returned.
(c) Each Note Guarantor that makes a payment or distribution under
any Note Guarantee shall have the right to seek contribution from the Company or
any non-paying Note Guarantor that has also Guaranteed the Guaranteed
Obligations in respect of which such payment or distribution is made, so long as
the exercise of such right does not impair the rights of the Holders under this
Note Guarantee.
(d) Each Note Guarantor acknowledges that it will receive direct and
indirect benefits from the financing arrangements contemplated by this Indenture
and that its Note Guarantee and the waiver set forth in Section 13.05 is
knowingly made in contemplation of such benefits.
(e) Each Note Guarantor also hereby agrees to pay any and all
reasonable out-of-pocket expenses (including reasonable counsel fees and
expenses) incurred by the Trustee or the Holders in enforcing any rights under
its Note Guarantee.
Section 13.02 Continuing Guarantees. Each Note Guarantee shall be a
continuing Guarantee and shall (i) remain in full force and effect until payment
in full of the principal amount of all outstanding Notes (whether by payment at
maturity, purchase, redemption, defeasance, retirement or other acquisition) and
all other Guaranteed Obligations then due and owing, unless earlier terminated
as provided in Section 13.03, (ii) be binding upon such Note Guarantor and (iii)
inure to the benefit of and be enforceable by the Trustee, the Holders and their
permitted successors, transferees and assigns.
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Section 13.03 Release of Note Guarantees. Notwithstanding the
provisions of Section 13.02 any Note Guarantee will be subject to termination
and discharge under the circumstances described in this Section 13.03:
(a) Any Note Guarantor will automatically and unconditionally be
released from all obligations under its Note Guarantee, and such Note Guarantee
shall thereupon terminate and be discharged and of no further force or effect,
(i) concurrently with any sale or disposition (by merger or otherwise) of any
Note Guarantor or any interest therein in accordance with the terms of this
Indenture (including the Section 4.10) by the Company or a Restricted
Subsidiary, following which such Note Guarantor is no longer a Restricted
Subsidiary of the Company, (ii) pursuant to the terms of its Note Guarantee,
(iii) at any time that such Note Guarantor is released from all of its
obligations under all of its Guarantees of payment by the Company of Bank
Indebtedness of the Company, (iv) upon the merger or consolidation of any Note
Guarantor with and into the Company or another Note Guarantor that is the
surviving Person in such merger or consolidation, (v) upon legal or covenant
defeasance of the Company's obligations, or satisfaction and discharge of this
Indenture as provided in Article 11 or Article 12, or (vi) subject to clause
(b)(iii) of Section 13.01, upon payment in full of the aggregate principal
amount of all Notes then Outstanding and all other Guaranteed Obligations then
due and owing.
(b) Upon 30 days' notice by the Company to the Trustee, any Note
Guarantor that has not guaranteed payment by the Company of any Bank
Indebtedness of the Company shall be unconditionally released from all
obligations under its Note Guarantee, and such Note Guarantee shall thereupon
terminate and be discharged and of no further force or effect.
Upon any such occurrence specified in this Section 13.03, the
Trustee shall execute any documents reasonably required in order to evidence
such release, discharge and termination in respect of such Note Guarantor's Note
Guarantee.
Section 13.04 Agreement to Subordinate. Any Note Guarantee is, to
the extent and in the manner set forth in Article 15, subordinated and subject
in right of payment to the prior payment in full of all Guarantor Senior
Indebtedness of the relevant Note Guarantor giving such Note Guarantee and any
Note Guarantee is made subject to such provisions of this Indenture.
Section 13.05 Waiver of Subrogation. Each Note Guarantor hereby
irrevocably waives any claim or other rights that it may now or hereafter
acquire against the Company that arise from the existence, payment, performance
or enforcement of the Company's obligations under the Notes and this Indenture
or such Note Guarantor's obligations under its Note Guarantee and this
Indenture, including, without limitation, any right of subrogation,
reimbursement, exoneration, indemnification, and any right to participate in any
claim or remedy of any Holder of Notes against the Company, whether or not such
claim, remedy or right arises in equity, or under contract, statute or common
law, until this Indenture is discharged and all of the Notes are discharged and
paid in full. If any amount shall be paid to a Note Guarantor in violation of
the preceding sentence and the Notes shall not have been paid in full, such
amount shall have been deemed to have been paid to such Note Guarantor for the
benefit of, and held in trust for the benefit of, the Holders of the Notes, and
shall forthwith be paid to the Trustee for the
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benefit of such Holders to be credited and applied upon the Notes, whether
matured or unmatured, in accordance with the terms of this Indenture.
Section 13.06 Notation Not Required. Neither the Company nor any
Note Guarantor shall be required to make a notation on the Notes to reflect any
Note Guarantee or any such release, termination or discharge thereof.
Section 13.07 Successors and Assigns of the Note Guarantors. All
covenants and agreements in this Indenture by each Note Guarantor shall bind its
respective successors and assigns, whether so expressed or not.
Section 13.08 Execution and Delivery of Note Guarantees. The Company
shall cause each Domestic Subsidiary that is required to become a Note Guarantor
pursuant to Section 4.13, and each Subsidiary of the Company that the Company
causes to become a Note Guarantor pursuant to Section 4.13, to promptly execute
and deliver to the Trustee a supplemental indenture substantially in the form
set forth in Exhibit B to this Indenture, or otherwise in form and substance
reasonably satisfactory to the Trustee, evidencing its Note Guarantee on
substantially the terms set forth in this Article 13. Concurrently therewith,
the Company shall deliver to the Trustee an Opinion of Counsel in form and
substance reasonably satisfactory to the Trustee to the effect that such
supplemental indenture has been duly authorized, executed and delivered by such
Restricted Subsidiary and that, subject to the applicable bankruptcy,
insolvency, fraudulent transfer, fraudulent conveyance, reorganization,
moratorium and other laws now or hereafter in effect affecting creditors' rights
or remedies generally and the general principles of equity (including standards
of materiality, good faith, fair dealing and reasonableness), whether considered
in a proceeding at law or at equity such supplemental indenture is a valid and
binding agreement of such Restricted Subsidiary, enforceable against such
Restricted Subsidiary in accordance with its terms.
Section 13.09 Notices. Notice to any Note Guarantor shall be
sufficient if addressed to any Note Guarantor care of the Company at the
address, place and manner provided in Section 1.09.
ARTICLE 14
SUBORDINATION
Section 14.01 Agreement To Subordinate. The Company agrees, and each
Noteholder by accepting a Note agrees, that the Indebtedness evidenced by the
Notes is subordinated in right of payment, to the extent and in the manner
provided in this Article 14, to the prior payment in full in cash (when due) of
all existing and future Senior Indebtedness of the Company and that the
subordination is for the benefit of and enforceable by the holders of Senior
Indebtedness of the Company. The Notes shall in all respects rank pari passu
with all other Senior Subordinated Indebtedness of the Company and only
Indebtedness of the Company that is Senior Indebtedness shall rank senior to the
Notes in accordance with the provisions set forth herein. All provisions of this
Article 14 shall be subject to Section 14.12.
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Section 14.02 Liquidation, Dissolution, Bankruptcy. Upon any payment
or distribution of the assets of the Company upon a total or partial liquidation
or dissolution or reorganization of or similar proceeding relating to the
Company or its property, or in a bankruptcy, insolvency, receivership or similar
proceeding relating to the Company or its property,
(i) the holders of Senior Indebtedness will be entitled to receive
payment in full in cash of the Senior Indebtedness before the Noteholders
are entitled to receive any payment (except that Holders of Notes may
receive and retain Permitted Junior Securities and payments made from the
trust described in Article 12 if the funding of such trust is permitted
under Article 12), and
(ii) until the Senior Indebtedness is paid in full in cash, any
payment or distribution to which Noteholders would be entitled but for
this Article 14 will be made to holders of the Senior Indebtedness as
their interests may appear.
Section 14.03 Default on Senior Indebtedness. The Company may not
pay principal of, or premium (if any) or interest on, the Notes or make any
deposit pursuant to the provisions of Article 12 and may not otherwise purchase,
redeem or otherwise retire any Notes (except that Holders of Notes may receive
and retain Permitted Junior Securities and payments made from the trust
described in Article 12 if the funding of such trust is permitted under Article
12) (collectively, "pay the Notes") if (i) any Senior Indebtedness is not paid
when due in cash or Cash Equivalents or (ii) any other default on Senior
Indebtedness occurs and the maturity of such Senior Indebtedness is accelerated
in accordance with its terms (either such event, a "Payment Default") unless, in
either case, (x) the Payment Default has been cured or waived and any such
acceleration has been rescinded in writing or (y) such Senior Indebtedness has
been paid in full in cash or Cash Equivalents; provided that the Company may pay
the Notes without regard to the foregoing if the Company and the Trustee receive
written notice approving such payment from the Representative for the Designated
Senior Indebtedness with respect to which the Payment Default has occurred and
is continuing.
In addition, during the continuance of any default (other than a
Payment Default) with respect to any Designated Senior Indebtedness pursuant to
which the maturity thereof may be accelerated immediately without further notice
(except such notice as may be required to effect such acceleration) or the
expiration of any applicable grace period (a "Non-payment Default"), the Company
may not pay the Notes for the period specified as follows (a "Payment Blockage
Period") (except that Holders of Notes may receive and retain Permitted Junior
Securities and payments made from the trust described Article 12 if the funding
of such trust is permitted under Article 12). The Payment Blockage Period shall
commence upon the receipt by the Trustee (with a copy to the Company) of written
notice (a "Blockage Notice") of such Non-payment Default from the Representative
for such Designated Senior Indebtedness specifying an election to effect a
Payment Blockage Period and shall end on the earliest to occur of the following
events: (i) 179 days shall have elapsed since such receipt of such Blockage
Notice, (ii) the Non-payment Default giving rise to such Blockage Notice is no
longer continuing (and no other Payment Default or Non-payment Default is then
continuing), (iii) such Designated Senior Indebtedness shall have been
discharged or repaid in full in cash or Cash Equivalents or (iv) such Payment
Blockage Period shall have been terminated by written notice to the Trustee and
the
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Company from the Person or Persons who gave such Blockage Notice. The Company
shall promptly resume payments on the Notes, including any missed payments,
after such Payment Blockage Period ends, unless any Payment Default otherwise
exists. Not more than one Blockage Notice may be given in any 360 consecutive
day period, irrespective of the number of defaults with respect to Designated
Senior Indebtedness during such period. In no event may the total number of days
during which any Payment Blockage Period is in effect extend beyond 179 days
from the date of receipt by the Trustee of the relevant Blockage Notice, and
there must be a 181 consecutive day period during any 360 consecutive day period
during which no Payment Blockage Period is in effect.
No nonpayment default that existed or was continuing on the date of
delivery of any Blockage Notice to the Trustee shall be, or be made, the basis
for a subsequent Blockage Notice unless such default shall have been cured or
waived for a period of not less than 90 consecutive days.
Section 14.04 Acceleration of Payment of Notes. If payment of the
Notes is accelerated because of an Event of Default, the Company or the Trustee
shall promptly notify the holders of the Bank Indebtedness or the Representative
of such holders of the acceleration. Such acceleration will not be effective
until five Business Days after such holders or the Representative of such
holders receive notice of such acceleration and, thereafter, the Company may pay
the Notes only if this Article 14 otherwise permits payment at that time.
Section 14.05 When a Distribution Must Be Paid Over. If a
distribution is made to Noteholders that because of provisions of this Article
14 should not have been made to them, the Noteholders who received the
distribution are required to hold it in trust for the holders of Senior
Indebtedness and pay it over to them as their interests may appear.
Section 14.06 Subrogation. After all Senior Indebtedness of the
Company is paid in full and until the Notes are paid in full, Holders shall be
subrogated to the rights of holders of Senior Indebtedness to receive
distributions applicable to such Senior Indebtedness. For purposes of such
subrogation, a distribution made under this Article 14 to holders of Senior
Indebtedness that otherwise would have been made to Holders is not, as between
the Company, its creditors other than the holders of such Senior Indebtedness
and Holders, a payment by the Company on such Senior Indebtedness, it being
understood that the provisions of this Article 14 are and are intended solely
for the purpose of defining the relative rights of the Holders, on the one hand,
and the holders of Senior Indebtedness of the Company, on the other hand.
Section 14.07 Relative Rights. This Article 14 defines the relative
rights of Holders and holders of Senior Indebtedness. Nothing in this Indenture
shall:
(i) impair, as between the Company and Holders, the obligation of
the Company which is absolute and unconditional, to pay principal of and
interest on the Notes in accordance with their terms; or
(ii) prevent the Trustee or any Holder from exercising its available
remedies upon a Default, subject to the rights of holders of Senior
Indebtedness to receive distributions otherwise payable to Holders.
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Section 14.08 Subordination May Not Be Impaired by Issuers. No right
of any holder of Senior Indebtedness of the Company to enforce the subordination
of the Indebtedness evidenced by the Notes shall be impaired by any act or
failure to act by the Company or by its failure to comply with this Indenture.
Section 14.09 Rights of Trustee and Paying Agent. The Company shall
give prompt written notice to the Trustee of any fact known to the Company that
would prohibit the making of any payment to or by the Trustee in respect of the
Notes. Failure to give such notice shall not affect the subordination of the
Notes to Senior Indebtedness of the Company. Notwithstanding Section 14.03, the
Trustee or Paying Agent may continue to make payments on the Notes and shall not
be charged with knowledge of the existence of facts that would prohibit the
making of any such payments unless, not less than two Business Days prior to the
date of such payment, a Trust Officer of the Trustee receives notice
satisfactory to it that payments may not be made under this Article 14. The
Company, the Registrar or co-registrar, the Paying Agent, or a Representative or
holder of Senior Indebtedness may give the notice; provided, however, that, if
an issue of Senior Indebtedness has a Representative, only the Representative
may give the notice. The Trustee shall be entitled to rely on the delivery to it
of a written notice by a Person representing himself or itself to be a holder of
any Senior Indebtedness (or a Representative of such holder) to establish that
such notice has been given by a holder of such Senior Indebtedness or
Representative thereof.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. The
Registrar and co-registrar and the Paying Agent may do the same with like
rights. The Trustee shall be entitled to all the rights set forth in this
Article 14 with respect to any Senior Indebtedness that may at any time be held
by it, to the same extent as any other holder of Senior Indebtedness; and
nothing in Article 7 shall deprive the Trustee of any of its rights as such
holder. Nothing in this Article 14 shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 7.07.
Section 14.10 Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness,
the distribution may be made and the notice given to their Representative (if
any).
Section 14.11 Article 14 Not To Prevent Events of Default or Limit
Right To Accelerate. The failure to make a payment pursuant to the Notes by
reason of any provision in this Article 14 shall not be construed as preventing
the occurrence of a Default. Subject to Section 14.04, nothing in this Article
14 shall have any effect on the right of the Holders or the Trustee to
accelerate the maturity of the Notes.
Section 14.12 Trust Moneys Not Subordinated. Notwithstanding
anything contained herein to the contrary, payments from money or the proceeds
of U.S. Government Obligations held in trust under Article 12 by the Trustee for
the payment of principal of and premium, if any, and interest on the Notes shall
not be subordinated to the prior payment of any Senior Indebtedness of the
Company or subject to the restrictions set forth in this Article 14, and none of
the Holders shall be obligated to pay over any such amount to the Company or any
holder of Senior Indebtedness of the Company or any other creditor of the
Company.
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Section 14.13 Trustee Entitled To Rely. Upon any payment or
distribution pursuant to this Article 14, the Trustee and the Holders shall be
entitled to rely (i) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 14.02
are pending, (ii) upon a certificate of the liquidating trustee or agent or
other Person making such payment or distribution to the Trustee or to the
Holders or (iii) upon the Representatives for the holders of Senior Indebtedness
for the purpose of ascertaining the Persons entitled to participate in such
payment or distribution, the holders of the Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article 14. In the event that the Trustee determines, in good faith,
that evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or distribution pursuant to
this Article 14, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and other facts pertinent to the rights of such
Person under this Article 14, and, if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment. The provisions of Sections
7.01 and 7.03 shall be applicable to all actions or omissions of actions by the
Trustee pursuant to this Article 14.
Section 14.14 Trustee To Effectuate Subordination. Each Holder by
accepting a Note authorizes and directs the Trustee on such Holder's behalf to
take such action as may be necessary or appropriate to acknowledge or effectuate
the subordination between the Holders and the holders of Senior Indebtedness of
the Company as provided in this Article 14 and appoints the Trustee as
attorney-in-fact for any and all such purposes.
Section 14.15 Trustee Not Fiduciary for Holders of Senior
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness of the Company and shall not be liable to any
such holders if it shall mistakenly pay over or distribute to Holders or the
Company or any other Person, money or assets to which any holders of Senior
Indebtedness shall be entitled by virtue of this Article 14 or otherwise. With
respect to the holders of Senior Indebtedness of the Company, the Trustee
undertakes to perform or to observe only such of its covenants or obligations as
are specifically set forth in this Article 14 or Article 15 and no implied
covenants or obligations with respect to holders of Senior Indebtedness of the
Company shall be read into this Indenture against the Trustee.
Section 14.16 Reliance by Holders of Senior Indebtedness on
Subordination Provisions. Each Holder by accepting a Note acknowledges and
agrees that the foregoing subordination provisions are, and are intended to be,
an inducement and a consideration to each holder of any Senior Indebtedness of
the Company, whether such Senior Indebtedness was created or acquired before or
after the issuance of the Notes, to acquire and continue to hold, or to continue
to hold, such Senior Indebtedness and such holder of Senior Indebtedness shall
be deemed conclusively to have relied on such subordination provisions in
acquiring and continuing to hold, or in continuing to hold, such Senior
Indebtedness.
Section 14.17 Trustee's Compensation Not Prejudiced. Nothing in this
Article 14 shall apply to amounts due to the Trustee pursuant to other Sections
of this Indenture.
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ARTICLE 15
SUBORDINATION OF NOTE GUARANTEES
Section 15.01 Agreement To Subordinate. Each Note Guarantor agrees,
and each Noteholder by accepting a Note agrees, that all payments pursuant to
such Note Guarantor's Note Guarantee made by or on behalf of such Note Guarantor
are subordinated in right of payment, to the extent and in the manner provided
in this Article 15, to the prior payment in full in cash (when due) of all
existing and future Guarantor Senior Indebtedness of such Note Guarantor and
that the subordination is for the benefit of and enforceable by the holders of
Guarantor Senior Indebtedness of such Note Guarantor. Such Note Guarantee shall
in all respects rank pari passu with all other Guarantor Senior Subordinated
Indebtedness of such Note Guarantor and only Indebtedness of such Note Guarantor
that is Guarantor Senior Indebtedness shall rank senior to such Note Guarantee
in accordance with the provisions set forth herein. All provisions of this
Article 15 shall be subject to Section 15.12.
Section 15.02 Liquidation, Dissolution, Bankruptcy. Upon any payment
or distribution of the assets of a Note Guarantor upon a total or partial
liquidation or dissolution or reorganization of or similar proceeding relating
such Note Guarantor or its property, or in a bankruptcy, insolvency,
receivership or similar proceeding relating to such Note Guarantor or its
property,
(i) the holders of Guarantor Senior Indebtedness of such Note
Guarantor will be entitled to receive payment in full in cash of such
Guarantor Senior Indebtedness before the Noteholders are entitled to
receive any payment from such Note Guarantor (except that Holders of Notes
may receive and retain Permitted Junior Securities and payments made from
the trust described in Article 12 if the funding of such trust is
permitted under Article 12); and
(ii) until the Guarantor Senior Indebtedness of such Note Guarantor
is paid in full in cash, any payment or distribution from such Note
Guarantor to which Noteholders would be entitled but for this Article 15
will be made to holders of such Guarantor Senior Indebtedness as their
interests may appear.
Section 15.03 Default on Guarantor Senior Indebtedness. No Note
Guarantor may make any payment pursuant to its Note Guarantee and may not
otherwise purchase, redeem or otherwise retire or defease any Notes (except that
Holders of Notes may receive and retain Permitted Junior Securities and payments
made from the trust described in Article 12 if the funding of such trust is
permitted under Article 12) (collectively, "pay its Note Guarantee") if (i) any
Guarantor Senior Indebtedness of such Note Guarantor is not paid when due or
(ii) any other default on Guarantor Senior Indebtedness of such Note Guarantor
occurs and the maturity of such Guarantor Senior Indebtedness is accelerated in
accordance with its terms (either such event, a "Guarantor Payment Default")
unless, in either case, (x) the Guarantor Payment Default has been cured or
waived and any such acceleration has been rescinded in writing or (y) such
Guarantor Senior Indebtedness has been paid in full in cash or Cash Equivalents;
provided, that, a Note Guarantor may pay its Note Guarantee without regard to
the foregoing if such Note Guarantor and the Trustee receive written notice
approving such payment from the
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Representative for the Designated Senior Indebtedness with respect to which the
Guarantor Payment Default has occurred and is continuing.
In addition, no Note Guarantor may pay its Note Guarantee during the
continuance of a Payment Blockage Period after receipt by the Company and the
Trustee of a Blockage Notice under Section 14.03. Notwithstanding the provisions
described in the immediately preceding sentence (but subject to the provisions
of the first paragraph of this Section 15.03), a Note Guarantor shall promptly
resume payments, if any are required, pursuant to its Note Guarantee, including
any missed payments, after such Payment Blockage Period ends, unless any Payment
Default otherwise exists.
In addition, during the continuance of any default (other than a
Guarantor Payment Default) with respect to any Guarantor Designated Senior
Indebtedness of a Note Guarantor pursuant to which the maturity thereof may be
accelerated immediately without further notice, except such notice as may be
required to effect such acceleration) or the expiration of any applicable grace
period (a "Guarantor Non-payment Default"), a Note Guarantor may not pay its
Note Guarantee for the period specified as follows (a "Guarantor Payment
Blockage Period"). The Guarantor Payment Blockage Period shall commence upon the
receipt by the Trustee (with copy to such Note Guarantor) of written notice (a
"Guarantor Blockage Notice") of such Guarantor Non-payment Default from the
Representative for such Guarantor Designated Senior Indebtedness specifying an
election to effect a Guarantor Payment Blockage Period and shall end on the
earliest to occur of the following events: (i) 179 days shall have elapsed since
such receipt of such Guarantor Blockage Notice, (ii) the Guarantor Non-payment
Default giving rise to such Blockage Notice is no longer continuing (and no
other Guarantor Payment Default or Guarantor Non-payment Default is then
continuing), (iii) such Guarantor Designated Senior Indebtedness shall have been
discharged or repaid in full in cash or Cash Equivalents or (iv) such Guarantor
Payment Blockage Period shall have been terminated by written notice to the
Trustee and such Note Guarantor from the Person or Persons who gave such
Guarantor Blockage Notice. A Note Guarantor may pay its Note Guarantee, after
such Guarantor Payment Blockage Period ends, unless any Guarantor Payment
Default otherwise exists. Not more than one Guarantor Blockage Notice to a Note
Guarantor in the aggregate may be given in any 360 consecutive day period,
irrespective of the number of defaults with respect to Guarantor Designated
Senior Indebtedness of such Note Guarantor during such period. In no event may
the total number of days during which any Guarantor Payment Blockage Period is
in effect extend beyond 179 days from the date of receipt by the Trustee of the
relevant Guarantor Blockage Notice, and there must be a 181 consecutive day
period during any 360 consecutive day period during which no Guarantor Payment
Blockage Period is in effect.
Section 15.04 Acceleration of Payment of Notes. If payment of the
Notes is accelerated because of an Event of Default, the relevant Note Guarantor
or the Trustee shall promptly notify the holders of the Bank Indebtedness of
such Guarantor (or the Representative of such holders) of the acceleration. Any
demand for payment under such Note Guarantor's Note Guarantee will not be
effective with respect to such Note Guarantor, until five Business Days after
such holders or the Representative of such holders receive notice of such demand
and, thereafter, such Note Guarantor may pay its Note Guarantee only if this
Article 15 otherwise permits payment at that time.
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Section 15.05 When a Distribution Must Be Paid Over. If a
distribution from a Note Guarantor is made to Holders that because of the
provisions of this Article 15 should not have been made to them, the Holders who
receive the distribution shall hold it in trust for holders of Guarantor Senior
Indebtedness of such Note Guarantor and pay it over to them as their interests
may appear.
Section 15.06 Subrogation. After all Guarantor Senior Indebtedness
of a Note Guarantor is paid in full and until the Notes are paid in full,
Holders shall be subrogated to the rights of holders of Guarantor Senior
Indebtedness of such Note Guarantor to receive distributions applicable to such
Guarantor Senior Indebtedness. For purposes of such subrogation, a distribution
made under this Article 15 to holders of Guarantor Senior Indebtedness of a Note
Guarantor that otherwise would have been made to Holders is not, as between such
Note Guarantor, its creditors other than the holders of such Guarantor Senior
Indebtedness, and Holders, a payment by such Note Guarantor on such Guarantor
Senior Indebtedness, it being understood that the provisions of this Article 15
are and are intended solely for the purpose of defining the relative rights of
the Holders, on the one hand, and the holders of Guarantor Senior Indebtedness
of such Note Guarantors, on the other hand.
Section 15.07 Relative Rights. This Article 15 defines the relative
rights of Holders and holders of Guarantor Senior Indebtedness of each Note
Guarantor. Nothing in this Indenture shall:
(i) impair, as between a Note Guarantor and Holders, the obligation
of such Note Guarantor to pay the Guaranteed Obligations in accordance
with the terms of its Note Guarantee; or
(xii) prevent the Trustee or any Holder from exercising its
available remedies upon a Default, subject to the rights of holders of
Guarantor Senior Indebtedness of a Note Guarantor to receive distributions
otherwise payable to Holders.
Section 15.08 Subordination May Not Be Impaired by Note Guarantors.
No right of any holder of Guarantor Senior Indebtedness of a Note Guarantor to
enforce the subordination of the payments pursuant to such Note Guarantor's Note
Guarantee shall be impaired by any act or failure to act by such Note Guarantor
or by its failure to comply with this Indenture.
Section 15.09 Rights of Trustee and Paying Agent. A Note Guarantor
shall give prompt written notice to the Trustee of any fact known to it that
would prohibit the making of any payment to or by the Trustee in respect of its
Note Guarantee. Failure to give such notice shall not affect the subordination
of the payments pursuant to its Note Guarantee to Guarantor Senior Indebtedness
of such Note Guarantor. Notwithstanding Section 15.03, the Trustee or Paying
Agent may continue to make payments pursuant to such Note Guarantee and shall
not be charged with knowledge of the existence of facts that would prohibit the
making of any such payments unless, not less than two Business Days prior to the
date of such payment, a Trust Officer of the Trustee receives notice
satisfactory to it that payments may not be made under this Article 15. The
Company or any Note Guarantor, the Registrar or co-registrar, the Paying Agent,
or a Representative or holder of Guarantor Senior Indebtedness of any Note
Guarantor may give the notice; provided, that, if an issue of Guarantor Senior
Indebtedness of a Note
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Guarantor has a Representative, only the Representative may give the notice. The
Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself or itself to be a holder of any Guarantor Senior
Indebtedness of a Note Guarantor (or a Representative of such holder) to
establish that such notice has been given by a holder of such Senior
Indebtedness or Representative thereof.
The Trustee in its individual or any other capacity may hold
Guarantor Senior Indebtedness of a Note Guarantor with the same rights it would
have if it were not Trustee. The Registrar and co-registrar and the Paying Agent
may do the same with like rights. The Trustee shall be entitled to all the
rights set forth in this Article 15 with respect to any Guarantor Senior
Indebtedness of a Note Guarantor which may at any time be held by it, to the
same extent as any other holder of Guarantor Senior Indebtedness of such Note
Guarantor; and nothing in Article 7 shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article 15 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.07.
Section 15.10 Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Guarantor Senior
Indebtedness of a Note Guarantor, the distribution may be made and the notice
given to their Representative (if any).
Section 15.11 Article 15 Not To Prevent Events of Default or Limit
Right To Accelerate. The failure to make a payment pursuant to a Note Guarantee
by reason of any provision in this Article 15 shall not be construed as
preventing the occurrence of a Default. Nothing in this Article 15 shall have
any effect on the right of the Holders or the Trustee to accelerate the maturity
of the Notes or make a demand for payment on a Note Guarantor pursuant to
Article 13 or the relevant Note Guarantee.
Section 15.12 Trust Moneys Not Subordinated. Notwithstanding
anything contained herein to the contrary, payments from money or the proceeds
of U.S. Government Obligations held in trust under Article 12 by the Trustee for
the payment of principal, premium, if any, or interest on the Notes shall not be
subordinated to the prior payment of any Guarantor Senior Indebtedness of any
Note Guarantor or subject to the restrictions set forth in this Article 15, and
none of the Holders shall be obligated to pay over any such amount to any Note
Guarantor or any holder of Guarantor Senior Indebtedness of any Note Guarantor
or any other creditor of any Note Guarantor.
Section 15.13 Trustee Entitled To Rely. Upon any payment or
distribution pursuant to this Article 15, the Trustee and the Holders shall be
entitled to rely (i) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 15.02
are pending, (ii) upon a certificate of the liquidating trustee or agent or
other Person making such payment or distribution to the Trustee or to the
Holders or (iii) upon the Representatives for the holders of Guarantor Senior
Indebtedness or any Note Guarantor for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of the
Guarantor Senior Indebtedness and other Indebtedness of such Note Guarantor, the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article 15. In the
event that the Trustee determines, in good faith, that evidence is required with
respect to the right of any Person as a holder of such Guarantor Senior
Indebtedness to participate in any payment or distribution pursuant to this
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Article 15, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of such Guarantor Senior
Indebtedness held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and other facts pertinent to the
rights of such Person under this Article 15, and, if such evidence is not
furnished, the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment. The
provisions of Sections 7.01 and 7.03 shall be applicable to all actions or
omissions of actions by the Trustee pursuant to this Article 15.
Section 15.14 Trustee To Effectuate Subordination. Each Holder by
accepting a Note authorizes and directs the Trustee on such Holder's behalf to
take such action as may be necessary or appropriate to acknowledge or effectuate
the subordination between the Holders and the holders of Guarantor Senior
Indebtedness of any Note Guarantor as provided in this Article 15 and appoints
the Trustee as attorney-in-fact for any and all such purposes.
Section 15.15 Trustee Not Fiduciary for Holders of Guarantor Senior
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Guarantor Senior Indebtedness of any Note Guarantor and shall not be
liable to any such holders if it shall mistakenly pay over or distribute to
Holders or the Company or any other Person, money or assets to which any holders
of Guarantor Senior Indebtedness shall be entitled by virtue of this Article 15
or otherwise. With respect to the holders of Guarantor Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its covenants or
obligations as are specifically set forth in this Article 15 and no implied
covenants or obligations with respect to holders of Guarantor Senior
Indebtedness of any Note Guarantor shall be read into this Indenture against the
Trustee.
Section 15.16 Reliance by Holders of Senior Indebtedness on
Subordination Provisions. Each Holder by accepting a Note acknowledges and
agrees that the foregoing subordination provisions are, and are intended to be,
an inducement and a consideration to each holder of any Guarantor Senior
Indebtedness of any Note Guarantor, whether such Guarantor Senior Indebtedness
was created or acquired before or after the issuance of the Notes, to acquire
and continue to hold, or to continue to hold, such Guarantor Senior Indebtedness
and such holder of such Guarantor Senior Indebtedness shall be deemed
conclusively to have relied on such subordination provisions in acquiring and
continuing to hold, or in continuing to hold, such Guarantor Senior
Indebtedness.
Section 15.17 Trustee's Compensation Not Prejudiced. Nothing in this
Article 15 shall apply to amounts due to the Trustee pursuant to other Sections
of this Indenture.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the date first written above.
NORTH AMERICAN VAN LINES, INC.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Secretary
FLEET INSURANCE MANAGEMENT, INC.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Vice President
FRONTRUNNER WORLDWIDE, INC.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Vice President
NACAL, INC.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Vice President
NAVTRANS INTERNATIONAL FREIGHT
FORWARDING, INC.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Vide President
<PAGE>
NORTH AMERICAN DISTRIBUTION
SYSTEMS, INC.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Vice President
NORTH AMERICAN LOGISTICS, LTD.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Vice President
NORTH AMERICAN VAN LINES OF TEXAS,
INC.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Vice President
RELOCATION MANAGEMENT SYSTEMS,
INC.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Vice President
GREAT FALLS NORTH AMERICAN, INC.
By: /s/ Ralph A. Ford
-------------------------------------
Name: Ralph A. Ford
Title: Vice President
<PAGE>
VANGUARD INSURANCE AGENCY, INC.
By: /s/ Robert J. Henry
-------------------------------------
Name: Robert J. Henry
Title: Secretary
ALLIED FREIGHT FORWARDING, INC.
By: /s/ Robert J. Henry
-------------------------------------
Name: Robert J. Henry
Title: Secretary
A RELOCATION SOLUTIONS MANAGEMENT
COMPANY
By: /s/ Robert J. Henry
-------------------------------------
Name: Robert J. Henry
Title: Secretary
ALLIED INTERNATIONAL N.A., INC.
By: /s/ Robert J. Henry
-------------------------------------
Name: Robert J. Henry
Title: Vice President
ALLIED VAN LINES TERMINAL COMPANY
By: /s/ Robert J. Henry
-------------------------------------
Name: Robert J. Henry
Title: Secretary
ALLIED VAN LINES, INC.
By: /s/ Robert J. Henry
-------------------------------------
Name: Robert J. Henry
Title: Secretary
<PAGE>
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By: /s/ Earl W. Dennison, Jr.
----------------------------
Name: Earl W. Dennison, Jr.
Title: Vice President
<PAGE>
EXHIBIT A
FORM OF NOTE(1)
NORTH AMERICAN VAN LINES, INC.
13 3/8% Senior Subordinated Notes due 2009
No. CUSIP No. [_________](2) [_________](3)
$ ___________________
North American Van Lines, Inc., a Delaware corporation (and its
successors and assigns), (the "Company"), promises to pay to ,
or registered assigns, the principal sum of $([____________] United States
Dollars) on December 1, 2009 [(or such lesser or greater amounts as shall be
outstanding hereunder from time to time in accordance with Sections 3.12 and
3.13 of the Indenture referred to on the reverse hereof)](4).
Interest Payment Dates: June 1 and December 1.
Record Dates: May 15 and November 15.
Additional provisions of this Note are set forth on the other side
of this Note.
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed.
NORTH AMERICAN VAN LINES, INC.
By: ________________________________
Name:
Title:
This is one of the Notes referred to in the within-named Indenture.
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By:__________________________
Name:
Title:
Dated: ________________________
- ----------
(1) Insert any applicable legends from Article 2.
(2) Include this or other appropriate CUSIP Number for Initial Note that is
not registered under the Securities Act.
(3) Include this or other appropriate CUSIP Number for Exchange Note or
Initial Note that is registered under the Securities Act.
(4) Include only in Global Note.
A-1
<PAGE>
[FORM OF REVERSE SIDE OF NOTE]
13 3/8% Senior Subordinated Note due 2009
1. Interest
The Company promises to pay interest semi-annually on December 1 and
June 1 in each year, commencing June 1, 2000 at the rate of 13 3/8% per annum
[(subject to adjustment as provided below)](5) [, except that interest accrued
on this Note for periods prior to the date on which the Initial Note was
surrendered in exchange for this Note will accrue at the rate or rates borne by
such Initial Note from time to time during such periods](6), until the Principal
Amount is paid or made available for payment. [Interest on this Note will accrue
from the most recent date to which interest on this Note or any of its
Predecessor Notes has been paid or duly provided for or, if no interest has been
paid, from the Issue Date.](7) [Interest on this Note will accrue from the most
recent date to which interest on this Note or any of its Predecessor Notes has
been paid or duly provided for or, if no such interest has been paid, from
[December 1, 1999](8).](9) Interest on the Notes shall be computed on the basis
of a 360-day year of twelve 30-day months. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Note (or
one or more Predecessor Notes) is registered at the close of business on the
Regular Record Date for such interest, which shall be the May 15 or November 15
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided
for will forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Note (or one or more
Predecessor Notes) is registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest to be fixed by the Trustee,
notice whereof shall be given to Holders of Notes not more than 15 days nor less
than 10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Notes may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture.
[The Holder of this Note is entitled to the benefits of the
Registration Rights Agreement (the " Registration Rights Agreement"), dated
November 19, 1999, among North American Van Lines, Inc., the Guarantors party
thereto, Banc of America Securities, LLC and Chase Securities Inc. Pursuant and
subject to the Registration Rights Agreement, until (i) the date on which this
Note has been exchanged for a freely transferable Exchange Note (as defined in
the Registration Rights Agreement) in the Registered Exchange Offer (as defined
in the Registration Rights Agreement), (ii) the date on which this Note has been
effectively registered
- ----------
(5) Include only for Initial Note when additional interest provisions, set
forth in the next paragraph, are included.
(6) Include only for Exchange Note.
(7) Include only for Original Notes.
(8) Insert first date of issuance of Additional Note and its Predecessor
Notes.
(9) Include only for Additional Notes (and Exchange Notes issued in the
exchange therefor).
A-2
<PAGE>
under the Securities Act and disposed of in accordance with the Shelf
Registration Statement (as defined in the Registration Rights Agreement), or
(iii) the date on which such Note is distributed to the public pursuant to Rule
144 of the Securities Act or is saleable pursuant to Rule 144(k) under the
Securities Act (or otherwise is eligible for resale pursuant to Rule 144 (or any
successor provision) under the Securities Act without volume restriction, if
any): From and including the date on which a Registration Default (as defined
below) shall occur to but excluding the date on which such Registration Default
has been cured, additional interest will initially accrue on the Note at the
rate of 0.25% per annum. Such rate will increase by 0.25% every twelve weeks.
Any such additional interest shall not exceed such respective rates for such
respective periods, and shall not in any event exceed 0.50% per annum in the
aggregate, regardless of the number of Registration Defaults that shall have
occurred and be continuing. Any such additional interest shall be paid in the
same manner and on the same dates as interest payments in respect of this Note.
Following the cure of all Registration Defaults, the accrual of such additional
interest will cease. All Registration Defaults shall be deemed cured upon the
consummation of the Registered Exchange Offer. For purposes of the foregoing,
each of the following events, as more particularly defined in the Registration
Rights Agreement, is a "Registration Default": (i) neither the Exchange Offer
Registration Statement nor a Shelf Registration Statement (as defined in the
Registration Rights Agreement) has been filed with the SEC on or before the
120th day after the Issue Date (or if such day is not a business day, the first
business day thereafter); (ii) the Registered Exchange Offer is not consummated
on or before the 240th day after the Issue Date (or if such day is not a
business day, the first business day thereafter), (iii) if a Shelf Registration
Statement is required to be filed under the Registration Rights Agreement, (A)
the Shelf Registration Statement is not declared effective by the SEC on or
before the 270th day after the Issue Date (or if such day is not a business day,
the first business day thereafter) (or, in the case of a Shelf Registration
Statement required to be filed in response to any change in applicable
interpretation of the SEC, if later, on or before the 90th day after the
publication of such change) (B) after such Shelf Registration Statement is
declared effective and during the time that the Company is required to use its
reasonable best efforts to keep the Shelf Registration Statement in effect, such
Shelf Registration Statement ceases to be effective and continues not to be
effective (other than in connection with the consummation of the Registered
Exchange Offer), or the Company shall have suspended and be continuing to
suspend the availability of the Shelf Registration Statement, for more than 30
days in the aggregate in any consecutive twelve-month period.](10) (11)
2. Method of Payment
Payment of the principal of (and premium, if any) and interest on
this Note will be made at the office or agency of the Company maintained for
that purpose in The Borough of Manhattan, The City of New York or the corporate
trust office of an affiliate of the Paying Agent in New York City; provided,
however, that at the option of the Company payment of interest may be made by
check mailed to the address of the Person entitled thereto as such address shall
appear in the Note Register or, if a Holder has given wire instructions to the
Company, by wire transfer to a U.S. Dollar account maintained by the Holder with
a bank located in New York City.
- ----------
(10) Include only for Initial Note when required by the Registration Rights
Agreement.
(11) For an Initial Additional Note, add any similar provision, if any, as may
be agreed by the Company with respect to additional interest on such
Initial Additional Note.
A-3
<PAGE>
3. Paying Agent and Registrar
Initially, State Street Bank and Trust Company, a Massachusetts
trust company, the Trustee, will act as principal Paying Agent and Registrar at
the corporate trust offices of its affiliate in the City of New York, State of
New York. The Company may appoint and change any Paying Agent, Registrar or
co-registrar without notice. The Company or any Subsidiary of the Company may
act as Paying Agent, Registrar or co-registrar.
4. Indenture
This Note is one of the duly authorized issue of 13 3/8% Senior
Subordinated Notes Due 2009 of the Company (herein called the "Notes"), issued
under an indenture, dated as of November 19, 1999 (as amended, supplemented or
otherwise modified from time to time, the "Indenture," which term shall have the
meanings assigned to it in such instrument), between North American Van Lines,
Inc., the Guarantors party thereto, and State Street Bank and Trust Company as
Trustee (herein called the "Trustee," which term includes any successor trustee
under the Indenture) and reference is hereby made to the Indenture for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, any other obligor upon this Note, the Trustee and the
Holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered. The terms of the Notes include those stated in the
Indenture and those made a part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended, as in effect from time to time (the "TIA").
The Notes are subject to all such terms, and Holders are referred to the
Indenture and the TIA for a statement of such terms. Additional Notes may be
issued under the Indenture which may vote as a class with the Notes and
otherwise be treated as Notes for purposes of the Indenture.
All terms used in this Note that are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
This Note is entitled to the benefits of the certain senior
subordinated Note Guarantees of the Note Guarantors and may hereafter be
entitled to certain other senior subordinated Note Guarantees made for the
benefit of the Holders. Reference is made to Article Thirteen of the Indenture
and to any Note Guarantees for terms relating to such Note Guarantees, including
the release, termination and discharge thereof. Neither the Company nor any Note
Guarantor shall be required to make any notation on this Note to reflect any
Note Guarantee or any such release, termination or discharge.
5. Optional Redemption
(a) The Notes will be redeemable, at the Company's option, in whole
or in part, and from time to time on and after December 1, 2004 and prior to
maturity. Such redemption may be made upon notice mailed by first-class mail to
each Holder's registered address in accordance with the Indenture. The Notes
will be so redeemable at the following Redemption Prices (expressed as a
percentage of principal amount), plus accrued interest, if any, to the relevant
Redemption Date (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date) if
redeemed during the 12-month period commencing on December 1 of the years set
forth below:
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<PAGE>
Redemption
Period Price
------ -------
2004...................... 106.688%
2005...................... 104.458%
2006...................... 102.229%
2007 and thereafter....... 100.000%
(b) In addition, at any time and from time to time prior to December
1, 2002, the Company at its option may redeem Notes in an aggregate principal
amount equal to up to 35% of the original aggregate principal amount of the
Notes (including the principal amount of any Additional Notes), with funds in an
aggregate amount (the "Redemption Amount") not exceeding the aggregate cash
proceeds of one or more Equity Offerings, at a Redemption Price (expressed as a
percentage of principal amount thereof) of 113.375% plus accrued interest, if
any, to the Redemption Date (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date); provided, however, that an aggregate principal amount of the Notes equal
to at least 65% of the original aggregate principal amount of the Notes
(including the principal amount of any Additional Notes) must remain outstanding
after each such redemption. The Company may make such redemption upon notice
mailed by first-class mail to each Holder's registered address in accordance
with the Indenture (but in no event more than 180 days after the completion of
the related Equity Offering).
6. No Sinking Fund
The Notes will not be entitled to the benefit of a sinking fund.
7. Subordination
The Notes are subordinated to Senior Indebtedness, as defined in the
Indenture. To the extent provided in the Indenture, Senior Indebtedness must be
paid before the Notes may be paid. In addition, any Note Guarantees are or shall
be, as the case may be, subordinated to Guarantor Senior Indebtedness (as
defined in the Indenture), as applicable. To the extent provided in the
Indenture, Guarantor Senior Indebtedness must be paid before any Note Guarantee
may be paid. The Company and any Note Guarantor agree, and each Holder by
accepting a Note agrees, to the subordination provisions contained in the
Indenture and authorizes the Trustee to give such provisions effect and appoints
the Trustee as attorney-in-fact for such purposes.
8. Put Provisions
The Indenture provides that, upon the occurrence of a Change of
Control Triggering Event, each Holder will have the right to require that the
Company repurchase all or any part of such Holder's Notes at a repurchase price
in cash equal to 101% of the aggregate principal amount thereof plus accrued and
unpaid interest, if any, to the date of such repurchase (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date); provided, however, that the Company shall not
be obligated to purchase Notes in the event it has exercised its right to redeem
all of the Notes.
9. Denominations; Transfer; Exchange
A-5
<PAGE>
The Notes are in registered form without coupons in denominations of
$1,000 and whole multiples of $1,000. A Holder may transfer or exchange Notes in
accordance with the Indenture and subject to certain limitations set forth
therein. No service charge shall be made for any transfer or exchange of Notes,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection therewith. The
Company shall not be required (i) to issue, transfer or exchange any Note during
a period beginning at the opening of business 15 days before the day of the
mailing of a notice of redemption (or purchase) of Notes selected for redemption
(or purchase) under Section 10.04 of the Indenture and ending at the close of
business on the day of such mailing, or (ii) to transfer or exchange any Note so
selected for redemption (or purchase) in whole or in part.
10. Persons Deemed Owners
The registered Holder of this Note may be treated as the owner of it
for all purposes.
11. Unclaimed Money
The Trustee shall pay to the Company upon a Company Request any
money held by it for the payment of principal (and premium, if any) or interest
that remains unclaimed for two years. After payment to the Company, Holders
entitled to money must look to the Company for payment as general creditors and
all liability of the Trustee or Paying Agent with respect to such money shall
thereupon cease.
12. Discharge and Defeasance
Subject to certain conditions, the Company at any time may terminate
some or all of its obligations under the Notes and the Indenture if the Company
deposits with the Trustee money or U.S. Government Obligations for the payment
of principal of, and premium (if any) and interest on the Notes to redemption or
maturity, as the case may be.
13. Amendment, Waiver
Subject to certain exceptions, (i) the Indenture may be amended with
the consent of the Holders of a majority in principal amount of the Notes then
outstanding and (ii) any past default or compliance with any provisions may be
waived with the consent of the Holders of a majority in principal amount of the
Notes then outstanding (including in each case, consents obtained in connection
with a tender offer or exchange offer for Notes). In certain instances provided
in the Indenture, the Indenture may be amended without the consent of any
Holder.
14. Defaults and Remedies
If an Event of Default with respect to the Notes occurs and is
continuing, the Notes may be declared due and payable immediately in the manner
and with the effect provided in the Indenture.
15. No Recourse Against Others
No director, officer, employee, incorporator, member or stockholder,
as such, of the Company, any Note Guarantor or any subsidiary thereof shall have
any liability for any
A-6
<PAGE>
obligation of the Company, or any Note Guarantor on the Notes under this
Indenture, the Notes, or any Note Guarantee, or for any claim based on, in
respect of, or by reason of, any such obligation or its creation. Each
Noteholder, by accepting the Notes, waives and releases all such liability. This
waiver and release are part of the consideration for issuance of the Notes.
16. Governing Law.
THE INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY
PRINCIPLES OF CONFLICT OF LAWS TO THE EXTENT THAT THE APPLICATION OF THE LAW OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. THE TRUSTEE, THE COMPANY, ANY
OTHER OBLIGOR IN RESPECT OF THE NOTES AND (BY THEIR ACCEPTANCE OF THE NOTES) THE
HOLDERS, AGREE TO SUBMIT TO THE JURISDICTION OF ANY UNITED STATES FEDERAL OR
STATE COURT LOCATED IN THE BOROUGH OF MANHATTAN, IN THE CITY OF NEW YORK IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE NOTES.
17. Authentication
This Note shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Note.
18. Abbreviations
Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
19. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders. No representation is made as
to the accuracy of such numbers either as printed on the Notes or as contained
in any notice of redemption and reliance may be placed only on the other
identification numbers placed hereon.
A-7
<PAGE>
[FORM OF TRANSFER NOTICE]
To assign this Note, fill in the form below:
I or we assign and transfer this Note to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint_________________________________________________________
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
[ [Check One]
|_|(a) this Note is being transferred in compliance with the exemption from
registration under the Securities Act of 1933, as amended, provided
by Rule 144A thereunder.
or
|_|(b) this Note is being transferred other than in accordance with (a)
above and documents are being furnished which comply with the
conditions of transfer set forth in this Note and the Indenture.
If neither of the foregoing boxes is checked, the Trustee or other Note
Registrar shall not be obligated to register this Note in the name of any Person
other than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 3.13 of the Indenture
shall have been satisfied.](12)
Date:_________________________
--------------------------------------
NOTICE: The signature to this
assignment must correspond with the
name as written upon the face of the
within-mentioned instrument in every
particular, without alteration or any
change whatsoever.
Signature Guarantee:__________________________________
- ----------
(12) Include only for an Initial Note or an Initial Additional Note that bears
the Private Placement Legend, in accordance with the Indenture.
A-8
<PAGE>
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Note Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
[TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Note for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended, and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the transferor is
relying upon the undersigned's foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
Dated:______________________ ____________________________________
NOTICE: To be executed by an executive
officer](13)
- ----------
(13) Include only for an Initial Note or an Initial Additional Note that bears
the Private Placement Legend, in accordance with the Indenture.
A-9
<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.14 of the Indenture, check the box: [ ].
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 4.10 or 4.14 of the Indenture, state the amount (in
principal amount):
$
Date: __________________ Signed: ___________________________
(Sign exactly as your name appears on the other
side of the Note)
Signature Guarantee:_______________________________________
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Note Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
A-10
<PAGE>
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE(14)
The following increases or decreases in this Global Note have been
made:
Date of Exchange Amount of Amount of Principal Signature of
decreases in increases in amount of this authorized
Principal Principal Global Note officer or
Amount of this Amount of following such Trustees of
Global Note this Global decreases or Securities
Note increases Custodian
- ----------
(14) Include only for Global Notes
A-11
<PAGE>
EXHIBIT B
Form of Supplemental Indenture in Respect of Note Guarantee
SUPPLEMENTAL INDENTURE, dated as of [_________] (this "Supplemental
Indenture"), among [name of [New Note Guarantor[s] (15)] (the "New Note
Guarantor[s]"), North American Van Lines, Inc., a Delaware corporation (the
"Company"), [any] [the] [each other] then existing Note Guarantor[s] under the
Indenture referred to below (the "Existing Guarantor[s]"), and State Street Bank
and Trust Company, as trustee (the "Trustee") under the Indenture referred to
below.
W I T N E S S E T H:
WHEREAS, the Company, [the] [any] Existing Guarantor[s], and the
Trustee have heretofore become parties to an Indenture, dated as of November 19,
1999, as amended (as amended, supplemented, waived or otherwise modified, the
"Indenture"), providing for the issuance of an aggregate principal amount of
$________of __% Senior Subordinated Notes due 2009 of the Company (the "Notes");
WHEREAS, Section 13.08 of the Indenture provides that the Company is
required to or may cause the New Note Guarantor[s] to execute and deliver to the
Trustee a supplemental indenture pursuant to which the New Note Guarantor[s]
shall guarantee the Notes pursuant to a Note Guarantee on the terms and
conditions set forth herein and in Article Thirteen of the Indenture;
WHEREAS, [the][each] New Note Guarantor desires to enter into this
Supplemental Indenture for good and valuable consideration, including
substantial economic benefit in that the financial performance and condition of
such New Note Guarantor is dependent on the financial performance and condition
of the Company and on [the] [such] New Note Guarantor's access to working
capital through the Company's access to revolving credit borrowings under the
Senior Credit Agreement; and
WHEREAS, pursuant to Section 9.01 of the Indenture, the parties
hereto are authorized to execute and deliver this Supplemental Indenture to
amend the Indenture, without the consent of any Holder;
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the New
Note Guarantor[s], the Company, [the Existing Guarantor[s] and the Trustee
mutually covenant and agree for the benefit of the Holders of the Notes as
follows:
1. Defined Terms. As used in this Supplemental Indenture, terms
defined in the Indenture or in the preamble or recital hereto are used herein as
therein defined. The words "herein," "hereof" and "hereby" and other words of
similar import used in this Supplemental
- ----------
(15) Insert as appropriate.
B-1
<PAGE>
Indenture refer to this Supplemental Indenture as a whole and not to any
particular section hereof.
2. Agreement to Guarantee. [The] [Each] New Note Guarantor hereby
agrees, jointly and severally with [all] [any] other New Note Guarantor[s], and
[all] [any] Existing Guarantor[s], fully and unconditionally, to guarantee the
Guaranteed obligations under the Indenture and the Notes on the terms and
subject to the conditions set forth in Article Thirteen of the Indenture and to
be bound by (and shall be entitled to the benefits of) all other applicable
provisions of the Indenture as a Note Guarantor. The Note Guarantee of each New
Note Guarantor is subject to the subordination provisions of the Indenture.
3. Termination, Release and Discharge. [The] [Each] New Note
Guarantor's Note Guarantee shall terminate and be of no further force or effect,
and [the] [each] New Note Guarantor shall be released and discharged from all
obligations in respect of such Note Guarantee, as and when provided in Section
13.03 of the Indenture.
4. Parties. Nothing in this Supplemental Indenture is intended or
shall be construed to give any Person, other than the Holders and the Trustee,
any legal or equitable right, remedy or claim under or in respect of [the]
[each] New Note Guarantor's Note Guarantee or any provision contained herein or
in Article Thirteen of the Indenture.
5. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ANY PRINCIPLES OF CONFLICT OF LAWS TO THE EXTENT THAT THE
APPLICATION OF THE LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. THE
TRUSTEE, THE COMPANY, ANY OTHER OBLIGOR IN RESPECT OF THE NOTES AND (BY THEIR
ACCEPTANCE OF THE NOTES) THE HOLDERS, AGREE TO SUBMIT TO THE JURISDICTION OF ANY
UNITED STATES FEDERAL OR STATE COURT LOCATED IN THE BOROUGH OF MANHATTAN, IN THE
CITY OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
INDENTURE OR THE NOTES.
6. Ratification of Indenture; Supplemental Indentures Part of
Indenture. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every Holder of Notes heretofore or
hereafter authenticated and delivered shall be bound hereby. The Trustee makes
no representation or warranty as to the validity or sufficiency of this
Supplemental Indenture.
7. Counterparts. The parties hereto may sign one or more copies of
this Supplemental Indenture in counterparts, all of which together shall
constitute one and the same agreement.
8. Headings. The section headings herein are for convenience of
reference only and shall not be deemed to alter or affect the meaning or
interpretation of any provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date first above written.
B-2
<PAGE>
[NAME OF NEW NOTE GUARANTOR],(16) as
New Note Guarantor
By:
------------------------------------
Name:
Title:
NORTH AMERICAN VAN LINES, INC.
By:
------------------------------------
Name:
Title:
STATE STREET BANK AND TRUST
COMPANY,
as Trustee
By:
------------------------------------
Name:
Title:
- ----------
(16) Add a signature block for each New Note Guarantor.
B-3
<PAGE>
EXHIBIT C
Form of Regulation S Certificate
Regulation S Certificate
State Street Bank and Trust Company
225 Asylum Street
23rd Floor
Hartford, Connecticut 06103
Re: NORTH AMERICAN VAN LINES, INC. (the "Company")
13 3/8% Senior Subordinated Notes due 2009 (the "Notes")
Ladies and Gentlemen:
In connection with our proposed sale of $_____ aggregate principal
amount of Notes, we confirm that such sale has been effected pursuant to and in
accordance with Regulation S ("Regulation S") under the Securities Act of 1933,
as amended (the "Securities Act"), and accordingly, we hereby certify as
follows:
1. The offer of the Notes was not made to a person in the United
States (unless such person or the account held by it for which it is
acting is excluded from the definition of "U.S. person" pursuant to Rule
902(k) of Regulation S under the circumstances described in Rule 902(h)(3)
of Regulation S) or specifically targeted at an identifiable group of U.S.
citizens abroad.
2. Either (a) at the time the buy order was originated, the buyer
was outside the United States or we and any person acting on our behalf
reasonably believed that the buyer was outside the United States or (b)
the transaction was executed in, on or through the facilities of a
designated offshore securities market, and neither we nor any person
acting on our behalf knows that the transaction was pre-arranged with a
buyer in the United States.
3. No directed selling efforts have been made in the United States
in contravention of the requirements of Rule 903(a)(2) or Rule 904(a)(2)
of Regulation S, as applicable.
4. The proposed transfer of Notes is not part of a plan or scheme to
evade the registration requirements of the Securities Act.
5. If we are a dealer or a person receiving a selling concession or
other fee or remuneration in respect of the Notes, and the proposed
transfer takes place before the Offshore Note Exchange Date referred to in
the Indenture, dated as of November __, 1999, between the Company and the
Trustee, or we are an officer or director of the Company or a distributor,
we certify that the proposed transfer is being made in accordance with the
provisions of Rules 903 and 904 of Regulation S.
6. We have advised the transferee of the transfer restrictions
applicable to the Notes.
C-1
<PAGE>
You, the Company and counsel for the Company are entitled to rely
upon this Certificate and are irrevocably authorized to produce this Certificate
or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered hereby. Terms
used in this certificate have the meanings set forth in Regulation S.
Very truly yours,
[NAME OF SELLER]
By:
------------------------------------
Name:
Title:
Address:
Date of this Certificate: _________________, _____
C-2
<PAGE>
EXHIBIT D
Form of Certificate of Beneficial Ownership
State Street Bank and Trust Company
225 Asylum Street
23rd Floor
Hartford, Connecticut 06103
Attention: Corporate Trust Department
Re: NORTH AMERICAN VAN LINES, INC.
(the "Company")
13 3/8% Senior Subordinated Notes due 2009 (the "Notes")
Ladies and Gentlemen:
This letter relates to $___________ principal amount of Notes
represented by the offshore global note certificate (the "Offshore Global
Note"). Pursuant to Section 3.13(3) of the Indenture dated as of November
19,1999, relating to the Notes (the "Indenture"), we hereby certify that (1) we
are the beneficial owner of such principal amount of Notes represented by the
Offshore Global Note and (2) we are either (i) a Non-U.S. Person to whom the
Notes could be transferred in accordance with Rule 904 of Regulation S
("Regulation S") promulgated under the Securities Act of 1933, as amended (the
"Act") or (ii) a U.S. Person who purchased securities in a transaction that did
not require registration under the Act. Accordingly, you are hereby requested to
issue an Offshore Physical Note representing the undersigned's interest in the
principal amount of Notes represented by the Offshore Global Note, all in the
manner provided by the Indenture.
You, the Company and counsel for the Company are entitled to rely
upon this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby. Terms used in this
certificate have the meanings set forth in Regulation S.
Very truly yours,
[Name of Holder]
By:
------------------------------------
Authorized Signature
D-1
<PAGE>
Exhibit 4.2
$150,000,000
NORTH AMERICAN VAN LINES, INC.
13 3/8% Senior Subordinated Notes due 2009
REGISTRATION RIGHTS AGREEMENT
-----------------------------
November 19, 1999
Banc of America Securities LLC
Chase Securities Inc.
c/o Banc of America Securities LLC
9 West 57th St., 47th Floor
New York, NY 10019
Dear Sirs:
This Agreement is made pursuant to the Purchase Agreement, dated
November 12, 1999, (the "Purchase Agreement"), by and among North American
Van Lines, Inc., a Delaware corporation (the "Company"), its domestic
subsidiaries party thereto (the "Guarantors") and Banc of America Securities
LLC and Chase Securities Inc. (the "Initial Purchasers"). In order to induce
the Initial Purchasers to purchase $150,000,000 in aggregate principal amount
of 13 3/8% Senior Subordinated Notes due 2009 of the Company, (the "Initial
Securities"), the Company has agreed to provide the registration rights set
forth in this Agreement. Capitalized terms used herein and not otherwise
defined shall have the meaning assigned to them the indenture, dated November
19, 1999, among the Company, the Guarantors and State Street Bank and Trust
Company, as Trustee, relating to the Initial Securities and the Exchange
Securities (as defined below) (the "Indenture").
The Company and the Guarantors agree with the Initial Purchasers, for the
benefit of the registered owners of the Initial Securities (including, without
limitation, the Initial Purchasers), the Exchange Securities (as defined below)
and the Private Exchange Securities (as defined below) (collectively the
"Holders"), as follows:
1. Registered Exchange Offer. The Company and the Guarantors shall, at
-------------------------
their own cost, prepare and use their reasonable best efforts to, not
later than 120 days (or if the 120th day is not a business day, the first
business day thereafter) after the date of original issue of the Initial
Securities (the "Issue Date"), file with the Securities and Exchange Commission
(the "Commission") a registration statement (the "Exchange Offer Registration
Statement") on an appropriate form under the Securities Act of 1933, as amended
(the "Securities Act"), with respect to a proposed offer (the "Registered
Exchange Offer") to those Holders of Initial Securities that are Transfer
Restricted Securities (as defined in Section 6 hereof) who are not prohibited by
any law or policy or interpretation of the Commission or its
<PAGE>
staff from participating in the Registered Exchange Offer, to issue and deliver
to such Holders, in exchange for the Initial Securities, a like aggregate
principal amount of debt securities (the "Exchange Securities") of the Company
issued under the Indenture and identical in all material respects to the Initial
Securities (except for the transfer restrictions relating to the Initial
Securities and the provisions relating to the matters described in Section 6
hereof) that would be registered under the Securities Act. The Company and the
Guarantors shall use all commercially reasonable efforts to cause such Exchange
Offer Registration Statement to become effective under the Securities Act within
210 days (or if the 210th day is not a business day, the first business day
thereafter) after the Issue Date of the Initial Securities and to keep the
Exchange Offer Registration Statement effective for not less than 10 business
days (or longer, if required by applicable law) after the date notice of the
Registered Exchange Offer is mailed to the Holders (such period being called the
"Exchange Offer Registration Period"). For purposes hereof, "business day" shall
mean any day other than a Saturday or Sunday, and other than a holiday on which
the Commission shall not be open for the transaction of business.
If the Company effects the Registered Exchange Offer, the Company will be
entitled to close the Registered Exchange Offer on the last day of the Exchange
Offer Registration Period, provided that the Company has accepted all the
Initial Securities theretofore validly tendered in accordance with the terms of
the Registered Exchange Offer.
Following the declaration of the effectiveness of the Exchange Offer
Registration Statement, the Company shall promptly commence the Registered
Exchange Offer, it being the objective of such Registered Exchange Offer,
subject to the terms and conditions hereof, to enable each Holder of Initial
Securities that are Transfer Restricted Securities electing to exchange the
Initial Securities for Exchange Securities (assuming that such Holder is not an
affiliate of the Company within the meaning of the Securities Act, acquires the
Exchange Securities in the ordinary course of such Holder's business and has no
arrangements with any person to participate in the distribution of the Exchange
Securities and is not prohibited by any law or policy or interpretation of the
Commission or its staff from participating in the Registered Exchange Offer) to
trade such Exchange Securities from and after their receipt without any
limitations or restrictions under the Securities Act.
The Company, each Guarantor and the Initial Purchasers acknowledge that,
pursuant to current interpretations by the Commission's staff of Section 5 of
the Securities Act, in the absence of an applicable exemption therefrom, (i)
each Holder that is a broker-dealer electing to exchange Initial Securities in
the Registered Exchange Offer, acquired for its own account as a result of
market making activities or other trading activities, for Exchange Securities (a
"Participating Broker-Dealer"), is required to deliver a prospectus containing
information substantially to the effect set forth in Annex A hereto, Annex B
hereto and Annex C hereto in the appropriate sections of such prospectus in
connection with a sale of any such Exchange Securities received by such
Participating Broker-Dealer pursuant to the Registered Exchange Offer and (ii)
an Initial Purchaser that elects to sell Private Exchange Securities (as defined
below) acquired in exchange for Initial Securities constituting any portion of
an unsold allotment, is required to deliver a prospectus containing the
information required by Items 507 or 508 of Regulation S-K under the Securities
Act, as applicable, in connection with such sale.
2
<PAGE>
The Company and the Guarantors shall use their 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 delivered by dealers subject to the prospectus delivery requirements of
Section 4(3) of the Securities Act and Rule 174 thereunder (for such period of
time as shall be required thereby for such delivery in order to resell the
Exchange Securities), and shall make such prospectus and any amendment or
supplement thereto available to any Participating Broker-Dealer for use in
connection with any resale of any Exchange Securities, in either case for a
period of not more than 90 days after the consummation of the Registered
Exchange Offer.
If, upon consummation of the Registered Exchange Offer, any Initial
Purchaser holds Initial Securities acquired by it as part of its initial
distribution, the Company, simultaneously with the delivery of the Exchange
Securities pursuant to the Registered Exchange Offer, shall issue and deliver to
such Initial Purchaser upon the written request of such Initial Purchaser, in
exchange (the "Private Exchange") for the Initial Securities held by such
Initial Purchaser, a like principal amount of debt securities of the Company
issued under the Indenture and identical in all material respects (including the
existence of restrictions on transfer under the Securities Act and the
securities laws of the several states of the United States, but excluding
provisions relating to the matters described in Section 6 hereof) to the Initial
Securities (the "Private Exchange Securities"). The Initial Securities, the
Exchange Securities and the Private Exchange Securities are herein collectively
called the "Securities".
In connection with the Registered Exchange Offer, the Company and the
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 10
business days (or longer, if required by applicable law) after the date
notice thereof 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,
which may be the Trustee or an affiliate of the Trustee;
(d) permit Holders to withdraw tendered Securities at any time prior
to the close of business, New York time, on the last business day on which
the Registered Exchange Offer shall remain open; and
(e) otherwise comply in all material respects with all applicable
securities laws.
As soon as practicable after the close of the Registered Exchange Offer or
the Private Exchange, as the case may be, the Company shall:
3
<PAGE>
(x) accept for exchange all the Securities validly tendered and not
withdrawn pursuant to the Registered Exchange Offer and the Private
Exchange;
(y) deliver to the Trustee for cancellation all the Initial
Securities so accepted for exchange; and
(z) request the Trustee to authenticate and deliver promptly to each
Holder of such Initial Securities, Exchange Securities or Private Exchange
Securities, as the case may be, equal in principal amount to such Initial
Securities of such Holder so accepted for exchange.
The Indenture will provide that all the Securities will vote and consent
together on all matters as one class and that none of the Securities will have
the right to vote or consent as a class separate from one another 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 to which interest was paid or duly
provided for on the Initial Securities surrendered in exchange therefor (subject
to the right of Holders of record on the relevant record date to receive
interest due on the relevant interest payment date) or, if no interest has been
paid on the Initial Securities, from the Issue Date provided that if an Initial
Security is surrendered for exchange on or after a record date for an interest
payment date that will occur on or after the date of such exchange and as to
which interest will be paid, interest on the Exchange Security received in
exchange therefor will accrue from the date of such interest payment date.
Each Holder participating in the Registered Exchange Offer shall be
required to represent to the Company that at the time of the consummation of the
Registered Exchange Offer (i) any Exchange Securities to be received by such
Holder will be acquired in the ordinary course of business, (ii) such Holder has
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, (iii) such Holder is not an "affiliate," as defined in Rule
405 of the Securities Act, of the Company or if it is an affiliate, such Holder
will comply with the registration and prospectus delivery requirements of the
Securities Act to the extent applicable, (iv) if such Holder is not a
broker-dealer, that it is not engaged in, and does not intend to engage in, the
distribution of the Exchange Securities, (v) if such Holder is a broker-dealer,
that it will receive Exchange Securities for its own account in exchange for
Initial Securities that were acquired as a result of market-making activities or
other trading activities and that it will deliver a prospectus in connection
with any resale of such Exchange Securities, and (vi) that it is not acting on
behalf of any person who could not truthfully make the foregoing
representations.
Notwithstanding any other provisions hereof, the Company and the
Guarantors will use their reasonable best efforts to 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
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)
4
<PAGE>
any prospectus forming part of any Exchange Offer Registration Statement, and
any supplement to such prospectus, does not include an untrue statement of a
material fact or omit to state 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.
Upon consummation of the Registered Exchange Offer in accordance with this
Section 1 (whether or not the actions or events specified in the first sentence
of this Section 1 occur within the time periods specified therefor) the
provisions of this Agreement shall continue to apply (to the extent applicable)
solely with respect to Securities that (i) were not eligible to be exchanged in
the Registered Exchange Offer (other than due to the status of the Holder
thereof as an affiliate of the Company or due to such Holder's inability to make
the representations referred to in the third to last paragraph of this Section
1) and have not been exchanged for Private Exchange Securities, (ii) were
received by the Holder thereof (other than a Participating Broker-Dealer) in the
Registered Exchange Offer but are not freely tradeable on the date of such
exchange (other than due to the status of such Holder as an affiliate of the
Company or due to such Holder's inability to make the representations referred
to in the third to last paragraph of this Section 1) or (iii) are Private
Exchange Securities and Exchange Securities held by Participating
Broker-Dealers, and the Company shall have no further obligation to register
Securities (other than those Securities referred to in clause (i) or (ii) above
and Private Exchange Securities) pursuant to Section 2 of this Agreement.
2. Shelf Registration. If, (i) because of any change in law or in
------------------
applicable interpretations thereof by the staff of the Commission, the Company
is not permitted to effect a Registered Exchange Offer, as contemplated by
Section 1 hereof, (ii) the Registered Exchange Offer is not consummated within
270 days of the Issue Date, (iii) any Initial Purchaser so requests with respect
to the Initial Securities (or the Private Exchange Securities) not eligible to
be exchanged for Exchange Securities in the Registered Exchange Offer and held
by it following consummation of the Registered Exchange Offer or (iv) any Holder
(other than the Initial Purchasers or a Participating Broker-Dealer) is not
eligible to participate in the Registered Exchange Offer or, in the case of any
Holder (other than the Initial Purchasers or a Participating Broker-Dealer) that
participates in the Registered Exchange Offer, such Holder does not receive
freely tradeable Exchange Securities on the date of the exchange (other than, in
either case, due solely to the status of such Holder as an affiliate of the
Company or due to such Holder's inability to make the representations referred
to in the third to last paragraph of Section 1 hereof), the Company and the
Guarantors shall take the following actions:
(a) The Company and the Guarantors shall, at their cost, use their
reasonable best efforts to file with the Commission as promptly as reasonably
practicable, and thereafter shall use their reasonable best efforts to be
declared effective within 270 days after the Issue Date, a registration
statement (the "Shelf Registration Statement" and, together with the Exchange
Offer Registration Statement, a "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 the Shelf Registration Statement
and Rule 415 under the Securities Act (hereinafter, the "Shelf Registration");
provided, however, that no Holder shall be entitled to have the Securities held
by it covered by such Shelf Registration Statement unless such Holder agrees in
writing to be bound
5
<PAGE>
by all the provisions of this Agreement applicable to such Holder (and each
Initial Purchaser hereby so agrees).
(b) The Company and the Guarantors shall use their reasonable best
efforts to keep the Shelf Registration Statement continuously effective in order
to permit the prospectus included therein to be lawfully delivered by the
Holders of the relevant Securities, for a period (the "Shelf Registration
Period") of two years (or one year in the case of a shelf registration effected
at the request of the Initial Purchasers) from the Issue Date or such shorter
period that will terminate when all the Securities covered by the Shelf
Registration Statement (i) have been sold pursuant thereto or (ii) are
distributed to the public pursuant to the Rule 144 under the Securities Act, or
any successor rule thereof or become eligible for resale pursuant to Rule 144
(or any successor rule thereof) without volume restriction, if any. The Company
and the Guarantors shall be deemed not to have used their reasonable best
efforts to keep the Shelf Registration Statement effective during the requisite
period if any of them voluntarily takes any action that would result in Holders
of Securities covered thereby not being able to offer and sell such Securities
during that period, unless (i) such action is required by applicable law, (ii)
such action is taken by the Company or such Guarantor in good faith and for
valid business reasons (not including avoidance of the Company's or such
Guarantor's obligations hereunder), including the acquisition or divestiture of
assets, so long as the Company or such Guarantor promptly thereafter complies
with the requirements of Section 3(j) hereof, if applicable, or (iii) such
action occurs following consummation of the Registered Exchange Offer.
(c) Notwithstanding any other provisions of this Agreement to the
contrary, the Company and the Guarantors shall use their reasonable best efforts
to cause the Shelf Registration Statement and the related prospectus and any
amendment or supplement thereto, as of the effective date of the Shelf
Registration Statement, amendment or supplement, (i) to comply in all material
respects with the applicable requirements of the Securities Act and the rules
and regulations of the Commission and (ii) not to contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading (in any such case,
other than with respect to information included therein in reliance upon or in
conformity with written information furnished to the Company by or on behalf of
any Holder specifically for use therein).
3. Registration Procedures. In connection with any Shelf Registration
-----------------------
contemplated by Section 2 hereof and, to the extent applicable, any Registered
Exchange Offer contemplated by Section 1 hereof, the following provisions shall
apply:
(a) The Company and the 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, in the event that an Initial Purchaser
(with respect to any portion of an unsold allotment from the original offering)
is participating in the Shelf Registration Statement, the Company and the
Guarantors shall use their reasonable best efforts to reflect in each such Shelf
Registration Statement or related amendment or supplement, when so filed with
the Commission, such comments as such Initial Purchaser reasonably may propose,
(ii) if applicable, include information substantially to the effect set forth in
Annex A hereto, Annex B hereto and Annex C
6
<PAGE>
hereto in the appropriate sections of the prospectus forming a part of the
Exchange Offer Registration Statement and include information substantially to
the effect set forth in Annex D hereto in the Letter of Transmittal delivered
pursuant to the Registered Exchange Offer, (iii) in the case of any Shelf
Registration Statement, if requested by an Initial Purchaser that proposes to
sell Securities pursuant to the Shelf Registration Statement as a selling
securityholder, include the information required by Items 507 or 508 of
Regulation S-K under the Securities Act, as applicable, in the prospectus
forming a part of the Shelf Registration Statement, (iv) include within the
prospectus contained in the Exchange Offer Registration Statement, in a section
entitled "Plan of Distribution" or other appropriate heading, a summary
statement reasonably acceptable to the Initial Purchasers, of the positions
taken or policies made by the staff of the Commission with respect to the
potential "underwriter" status of any broker-dealer that is the beneficial owner
(as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act")) of Exchange Securities received by such broker-dealer in
the Registered Exchange Offer, and (v) in the case of a Shelf Registration
Statement, include the names of the Holders who propose to sell Securities
pursuant to the Shelf Registration Statement as selling securityholders (the
"Selling Holders").
(b) The Company shall advise each of the Initial Purchasers, the
Selling Holders (in the case of a Shelf Registration Statement) and any
Participating Broker-Dealer (in the case of any Exchange Offer Registration
Statement) from whom the Company has received prior written notice that it will
be a Participating Broker-Dealer in the Registered Exchange Offer, and, if
requested by any such person, confirm such advice in writing (which advice
pursuant to clauses (ii)-(v) hereof shall be accompanied (if applicable) by an
instruction to suspend the use of the relevant prospectus until the requisite
changes have been made):
(i) when the Registration Statement or any amendment thereto has
been filed with the Commission and when the Registration Statement or any
post-effective amendment thereto has become effective;
(ii) of any request by the Commission for amendments or supplements
to the 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 the Registration Statement or the initiation of any
proceedings for that purpose;
(iv) of the receipt by the Company, any Guarantor or its legal
counsel of any notification with respect to the suspension of the
qualification of the 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 Company to make
changes in the Registration Statement or the prospectus in order that the
Registration Statement (as of its effective date) or the prospectus do not
contain an untrue statement of a material fact nor omit to state a
material fact required to be stated therein or necessary to make the
statements therein (in the case of the prospectus, in light of the
circumstances under which they were made) not misleading.
7
<PAGE>
(c) The Company and the Guarantors shall make every reasonable
effort to obtain the withdrawal at the earliest possible time, of any order
suspending the effectiveness of the Registration Statement.
(d) The Company and the Guarantors shall furnish to each Holder of
Transfer Restricted Securities included within the coverage of the Shelf
Registration, without charge, at least one copy of the Shelf Registration
Statement and any post-effective amendment thereto, including financial
statements and schedules, and, if the Holder so requests in writing, all
exhibits thereto (including those, if any, incorporated by reference).
(e) The Company and the Guarantors shall deliver to each
Participating Broker-Dealer (on request) and each Initial Purchaser, without
charge, at least one copy of the Exchange Offer Registration Statement and any
post-effective amendment thereto, including financial statements and schedules,
and, if any Initial Purchaser requests, all exhibits thereto (including those,
if any, incorporated by reference).
(f) The Company shall, during the Shelf Registration Period, deliver
to each Selling Holder of Securities included within the coverage of the Shelf
Registration Statement, without charge, as many copies of the prospectus
(including each preliminary prospectus) included in the Shelf Registration
Statement and any amendment or supplement thereto as such person may reasonably
request. The Company and the Guarantors consent, subject to the provisions of
this Agreement, to the use (in accordance with this Agreement and applicable
law) of the prospectus or any amendment or supplement thereto by each of the
Selling Holders of the Transfer Restricted Securities in connection with the
offering and sale of the Transfer Restricted Securities covered by the
prospectus, or any amendment or supplement thereto, included in the Shelf
Registration Statement.
(g) The Company and the Guarantors shall, during the Exchange Offer
Registration Period, deliver to each Initial Purchaser, and any Participating
Broker-Dealer, without charge, as many copies of the final prospectus included
in the Exchange Offer Registration Statement and any amendment or supplement
thereto as such person may reasonably request. The Company and the Guarantors
consent, subject to the provisions of this Agreement, to the use of such
prospectus or any amendment or supplement thereto, during the 90 days following
the consummation of the Registered Exchange Offer, by any Participating
Broker-Dealer required to deliver a prospectus following the Registered Exchange
Offer in connection with the offering and sale of the Exchange Securities
covered by the prospectus, or any amendment or supplement thereto, included in
such Exchange Offer Registration Statement.
(h) Prior to any public offering of the Securities pursuant to any
Shelf Registration Statement, the Company and the Guarantors shall use their
reasonable best efforts to register or qualify or cooperate with the Selling
Holders of the Securities included therein and their respective counsel in
connection with the registration or qualification of the Securities for offer
and sale under the securities or "blue sky" laws of such states of the United
States as any such Holder of the Securities 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 covered by such Registration
Statement; provided, however, that the Company shall not be required to (i)
qualify generally to do business in any jurisdiction where it is not then so
qualified
8
<PAGE>
or (ii) take any action that would subject it to general service of process or
to taxation in any jurisdiction where it is not then so subject.
(i) The Company and the Guarantors shall cooperate with the Selling
Holders of the Securities to facilitate the timely preparation and delivery of
certificates representing the Transfer Restricted Securities to be sold pursuant
to any Shelf Registration Statement free of any restrictive legends relating to
transfer restrictions (and not required by stock exchange rule or depository
rule or usage) and in such denominations and registered in such names as the
Holders may reasonably request in writing a reasonable period of time prior to
sales of such Securities pursuant to such Shelf Registration Statement.
(j) Upon the occurrence of any event contemplated by paragraphs (ii)
through (v) of Section 3(b) above during the period for which the Company is
required to maintain an effective Registration Statement, the Company and the
Guarantors shall use their reasonable best efforts to promptly prepare and file
a post-effective amendment to the Registration Statement or a supplement to the
related prospectus and any other required document so that, as thereafter
delivered to Holders of the Securities or purchasers of Securities, the
prospectus will not contain an untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. If the Company notifies the Initial Purchasers, the Selling
Holders of the Securities or any known Participating Broker-Dealer in accordance
with paragraphs (ii) through (v) of Section 3(b) above to suspend the use of the
prospectus until the requisite changes to the prospectus have been made, then
the Initial Purchasers, such Holders of the Securities or any such Participating
Broker-Dealer, as applicable, shall suspend use of such prospectus. The period
of effectiveness of the Shelf Registration Statement provided for in Section
2(b) above or the Exchange Offer Registration Statement provided for in Section
1 above, as applicable, shall be extended by the number of days from and
including the date of giving of such notice to and including the date when the
Company or any Guarantor shall have mailed to the Selling Holders of the
Securities or any known Participating Broker-Dealer, as applicable, such amended
or supplemented prospectus pursuant to this Section 3(j).
(k) Not later than the effective date of the applicable Registration
Statement, the Company will provide a CUSIP number for the Initial Securities,
the Exchange Securities or the Private Exchange Securities, as the case may be.
The Company will, at appropriate times, provide the applicable trustee with
printed certificates for the Initial 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 will make generally available to its securityholders
(or otherwise provide in accordance with Section 11(a) of the Securities Act) an
earnings statement satisfying the provisions of Section 11(a) of the Securities
Act (which need not be audited), no 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 first fiscal quarter commencing after the effective
date of the Registration Statement, which statement shall cover such 12-month
period.
(m) The Company and the Guarantors shall use their reasonable best
efforts to cause the Indenture to be qualified under the Trust Indenture Act of
1939, as amended, in a
9
<PAGE>
timely manner and containing such changes, if any, as shall be necessary for
such qualification. In the event that such qualification would require the
appointment of a new trustee under the Indenture, the Company and the Guarantors
shall use their reasonable best efforts to appoint a new trustee thereunder
pursuant to the applicable provision of the Indenture.
(n) The Company or any Guarantor may require each Holder of
Securities to be sold pursuant to the Shelf Registration Statement to furnish to
the Company or such Guarantor such information regarding the Holder and the
distribution of the Securities as the Company or such Guarantor may from time to
time reasonably require for inclusion in the Shelf Registration Statement, and
the Company or any Guarantor may exclude from such registration the Securities
of any Holder that unreasonably fails to furnish such information within a
reasonable time after receiving such request.
(o) In the case of any Shelf Registration Statement, the Company and
the Guarantors shall enter into such customary agreements (including, if
requested, an underwriting agreement in customary form) and use their reasonable
best efforts to take all such other action, if any, as Selling Holders of a
majority in aggregate principal amount of the Securities being sold pursuant to
the Shelf Registration Statement (the "Majority Selling Holders") or the
managing underwriters, if any, in such offering shall reasonably request in
order to facilitate the disposition of the Securities pursuant to such Shelf
Registration Statement.
(p) In the case of any Shelf Registration Statement, the Company and
the Guarantors shall (i) make reasonably available for inspection by a
representative of, and Special Counsel (as defined below) acting for, the
Majority Selling Holders and any underwriter participating in any disposition of
Securities pursuant to the Shelf Registration Statement (such representative,
Special Counsel or underwriter, an "Inspector"), all relevant financial and
other records, pertinent corporate documents and properties of the Company and
each Guarantor and (ii) use their reasonable best efforts to cause the Company's
and each Guarantor's officers, directors, employees, accountants and auditors to
supply all relevant information reasonably requested by such Inspector in
connection with the Shelf Registration Statement, in each case, as shall be
reasonably necessary to enable such persons to conduct a reasonable
investigation within the meaning of Section 11 of the Securities Act; provided,
however, that the foregoing inspection and information gathering shall be
coordinated by the Inspectors. Each Inspector will be required to agree in
writing, pursuant to a confidentiality agreement in form and substance
reasonably satisfactory to the Company and such Inspector, that (i) information
obtained by such Inspector as a result of such inspections shall be deemed
confidential and shall not be used by such Inspector as the basis for any market
transactions in the securities of any of the Company and its subsidiaries unless
and until such information is made generally available to the public (other than
by or through any Inspector) and (ii) such Inspector will, upon learning that
disclosure of such records is sought in a court of competent jurisdiction, give
notice to the Company and allow the Company, at its expense, to undertake
appropriate action to prevent disclosure of the records deemed confidential.
(q) In the case of any Shelf Registration Statement, the Company and
the Guarantors, if requested by the Majority Selling Holders of Securities
covered thereby, shall use their reasonable best efforts to cause (i) the
Company's counsel to deliver an opinion relating to the Securities in customary
form, addressed to the Selling Holders of Securities covered thereby,
10
<PAGE>
(ii) its officers to execute and deliver all customary documents and
certificates reasonably requested by any managing underwriters of the applicable
Securities and (iii) the Company's independent public accountants to provide a
comfort letter in customary form addressed to the Selling Holders of Securities
covered thereby, subject to receipt of appropriate documentation as
contemplated, and only if permitted, by Statement of Auditing Standards No. 72.
(r) If a Registered Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Initial Securities by Holders to the Company
(or to such other Person as directed by the Company) in exchange for the
Exchange Securities or the Private Exchange Securities, as the case may be, the
Company shall mark, or caused to be marked, on the Initial Securities so
exchanged that such Initial Securities are being canceled in exchange for the
Exchange Securities or the Private Exchange Securities, as the case may be; in
no event shall the Initial Securities be marked as paid or otherwise satisfied.
4. Registration Expenses. The Company shall bear all fees and expenses
---------------------
incurred by it and the Guarantors in connection with the performance of their
obligations under Sections 1 through 3 hereof, whether or not the Registered
Exchange Offer or a Shelf Registration Statement is filed or becomes effective,
and, in the event of a Shelf Registration Statement, shall reimburse the Holders
of the Securities covered thereby for the reasonable fees and disbursements of
one firm of counsel designated by the Holders of a majority in principal amount
of the Securities covered thereby (the "Special Counsel") to act as counsel for
the Holders of the Securities in connection therewith. The Initial Purchasers
shall bear any fees and expenses of their counsel incurred in connection with
the Registered Exchange Offer.
5. Indemnification. (a) The Company and each Guarantor, jointly and
---------------
severally, agrees to indemnify and hold harmless (in the case of a Shelf
Registration Statement) each Selling Holder of Securities covered thereby and
each person, if any, who controls such Holder within the meaning of the
Securities Act or the Exchange Act, and (in the case of an Exchange Offer
Registration Statement, in connection with any delivery of the prospectus
contained therein by a Participating Broker-Dealer) any Participating
Broker-Dealer and each person, if any, who controls such Participating
Broker-Dealer within the meaning of the Securities Act or the Exchange Act (each
such Holder, any such Participating Broker-Dealer and such controlling persons
are referred to collectively as the "Indemnified Parties") from and against any
losses, claims, damages or liabilities, joint or several, or any actions in
respect thereof (including, but not limited to, any losses, claims, damages,
liabilities or actions relating to purchases and sales of the Securities) to
which each Indemnified Party may become subject under the Securities Act, the
Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities
or actions arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in such applicable Registration Statement
or prospectus forming part thereof or in any amendment or supplement thereto or
(in the case of such Shelf Registration Statement) in any preliminary prospectus
relating to a Shelf Registration Statement, or arise out of, or are based upon,
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, and shall reimburse
the Indemnified Parties for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim, damage,
liability or action in respect thereof; provided, however, that (i) neither the
Company nor any Guarantor shall be liable in any such case to the extent that
such loss,
11
<PAGE>
claim, damage or liability arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission made in a
Registration Statement or prospectus forming part thereof or in any amendment or
supplement thereto or in any preliminary prospectus relating to a Shelf
Registration Statement in reliance upon and in conformity with written
information pertaining to such Holder and furnished to the Company by or on
behalf of such Holder specifically for inclusion therein and (ii) with respect
to any untrue statement or omission or alleged untrue statement or omission made
in any prospectus, or any amendment or supplement thereto, or any preliminary
prospectus relating to a Shelf Registration Statement, the indemnity contained
in this subsection (a) shall not inure to the benefit of any Holder or
Participating Broker-Dealer from whom the person asserting any such losses,
claims, damages or liabilities purchased the Securities concerned if either (x)
a copy of the final prospectus (as then amended or supplemented if the Company
shall have furnished any amendments or supplements thereto) was not seen or
given by or on behalf of such Holder or Participating Broker-Dealer to such
person at or prior to the written confirmation of the sale of the Securities to
such person, and any such untrue statement of a material fact contained in, or
any such omission or alleged omission of a material fact from, such preliminary
prospectus, prospectus or amendment or supplement thereto giving rise to such
losses, claims, damages or liabilities was corrected in the final prospectus (as
so amended or supplemented), unless such failure is the result of noncompliance
by the Company with the first sentence of Section 3(f) hereof or (y) at the time
of such purchase such Holder or Participating Broker-Dealer had received advice
from the Company that the use of such prospectus, amendment, supplement or
preliminary prospectus was suspended as provided in Section 3(b); provided
further, however, that this indemnity agreement will be in addition to any
liability that the Company and the Guarantors may otherwise have to such
Indemnified Party.
(b) Each Holder of the Securities, severally and not jointly, will
indemnify and hold harmless the Company and the Guarantors and each person, if
any, who controls the Company or any Guarantor within the meaning of the
Securities Act or the Exchange Act from and against any losses, claims, damages
or liabilities, joint or several, or any actions in respect thereof, to which
the Company, any Guarantor or any such controlling person may become subject
under the Securities Act, the Exchange Act or otherwise, insofar as such losses,
claims, damages, liabilities or actions arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus forming part thereof or in any amendment or
supplement thereto or in any preliminary prospectus relating to a Shelf
Registration Statement, or arise out of or are based upon the omission or
alleged omission to state therein a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, but in each case only to the extent that the untrue statement or
omission or alleged untrue statement or omission was made in reliance upon and
in conformity with written information pertaining to such Holder and furnished
to the Company by or on behalf of such Holder specifically for inclusion
therein; and, subject to the limitation set forth immediately preceding this
clause, shall reimburse the Company or any Guarantor for any legal or other
expenses reasonably incurred by the Company, any Guarantor or any such
controlling person in connection with investigating or defending any loss,
claim, damage, liability or action in respect thereof. This indemnity agreement
will be in addition to any liability that such Holder may otherwise have to the
Company, any Guarantor or any of their respective controlling persons.
12
<PAGE>
(c) Promptly after receipt by an indemnified party under this
Section 5 of notice of the commencement of any action or proceeding (including a
governmental investigation), such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 5,
notify the indemnifying party of the commencement thereof, but the omission so
to notify the indemnifying party will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in subsection (a) or (b) above. In case any
such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof the indemnifying party will not be
liable to such indemnified party under this Section 5 for any legal or other
expenses, other than reasonable costs of investigation, subsequently incurred by
such indemnified party in connection with the defense thereof. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened action in which any indemnified
party is a party to the extent such settlement is binding upon such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action.
(d) If the indemnification provided for in this Section 5 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to reflect
the relative benefits received by the indemnifying party or parties on the one
hand and the indemnified party on the other, or (ii) if the allocation provided
by the foregoing clause (i) 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 indemnifying party or
parties on the one hand and the indemnified party on the other in connection
with the statements or omissions that resulted in such losses, claims, damages
or liabilities (or actions in respect thereof) as well as any other relevant
equitable considerations. The relative fault of the parties shall be determined
by reference to, among 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 information supplied by the Company and the Guarantors
on the one hand or such Holder or such other indemnified party, as the case may
be, on the other, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid by an indemnified party as a result of the losses, claims,
damages or liabilities referred to in the first sentence of this subsection (d)
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any action
or claim that is the subject of this subsection (d). 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. For purposes of this subsection
(d), each person, if any, who controls such indemnified party within the meaning
of the Securities Act or the Exchange Act shall have the same rights to
contribution as such indemnified party and each person, if any, who controls the
Company or any Guarantor
13
<PAGE>
within the meaning of the Securities Act or the Exchange Act shall have the same
rights to contribution as the Company or such Guarantor.
(e) The agreements contained in this Section 5 shall survive the
sale of the Securities pursuant to a Registration Statement and shall remain in
full force and effect, regardless of any termination or cancellation of this
Agreement or any investigation made by or on behalf of any indemnified party.
6. Additional Interest Under Certain Circumstances. (a) Additional
-----------------------------------------------
interest (the "Additional Interest") with respect to the Initial Securities that
are Transfer Restricted Securities shall be assessed as follows if any of the
following events occur (each such event in clauses (i) through (ii) below being
herein referred to as a "Registration Default"):
(i) neither the Exchange Offer Registration Statement nor a Shelf
Registration Statement has been filed with the Commission on or before the
120th day after the Issue Date (or if such day is not a business day, the
first business day thereafter);
(ii) the Registered Exchange Offer is not consummated on or before
the 240th day after the Issue Date (or if such day is not a business day,
the first business day thereafter);
(iii) if a Shelf Registration Statement is required to be filed
under this Agreement, such Shelf Registration Statement is not declared
effective by the Commission on or before the 270th day after the Issue
Date (or if such day is not a business day, the first business day
thereafter), or, in the case of a Shelf Registration Statement required to
be filed in response to any change in applicable interpretation of the
Commission, if later, on or before the 90th day after publication of such
change; or
(iv) if a Shelf Registration Statement is required to be filed under
this Agreement, and after the Shelf Registration Statement is declared
effective and during the period that the Company and the Guarantors are
required to use their reasonable best efforts to keep the Shelf
Registration Statement effective as provided in Section 2(a), such Shelf
Registration Statement thereafter ceases to be effective and continues not
to be effective (other than in connection with the consummation of the
Registered Exchange Offer, as contemplated by the last sentence of Section
2(a)), or the Company shall have suspended and be continuing to suspend
the availability of the prospectus contained in the Shelf Registration
Statement, for more than 30 days in the aggregate in any consecutive
twelve-month period.
Additional Interest shall initially accrue on the Initial Securities that
are Transfer Restricted Securities over and above the interest set forth in the
title of the Securities from and including the date on which any such
Registration Default shall occur to but excluding the date on which such
Registration Default has been cured, at a rate of 0.25% per annum. The rate of
Additional Interest shall increase by 0.25% per annum every twelve weeks
thereafter (for so long as such period is continuing). Any such Additional
Interest shall not exceed such respective rates for such respective periods, and
shall not in any event exceed 0.50% per annum in the aggregate, regardless of
the number of Registration Defaults that shall have occurred and be
14
<PAGE>
continuing. Following the cure of all Registration Defaults, the accrual of such
Additional Interest will cease. All Registration Defaults will be deemed cured
upon consummation of the Exchange Offer.
Notwithstanding anything to the contrary in this Section 6(a), neither the
Company nor any Guarantor shall be required to pay Additional Interest to any
Holder of Transfer Restricted Securities if such Holder failed to comply with
its obligations to make the representations set forth in the third to last
paragraph of Section 1 or failed to provide the information required to be
provided by it, if any, pursuant to Section 3(n).
(b) Any amounts of Additional Interest due pursuant to clause (i),
(ii), (iii) or (iv) of Section 6(a) above will be payable in cash on the regular
interest payment dates with respect to the Initial Securities. The amount of
Additional Interest will be determined by multiplying the applicable Additional
Interest rate by the principal amount of the Initial Securities that are
Transfer Restricted Securities, multiplied by a fraction, the numerator of which
is the number of days such Additional Interest rate was applicable during such
period (determined on the basis of a 360-day year comprised of twelve 30-day
months), and the denominator of which is 360.
(c) "Transfer Restricted Securities" means each Security until (i)
the date on which such Security has been exchanged by a person for a freely
transferable Exchange Security in the Registered Exchange Offer, (ii) the date
on which such Security has been effectively registered under the Securities Act
and disposed of in accordance with the Shelf Registration Statement or (iii) the
date on which such Security 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 (or otherwise is eligible for resale pursuant to Rule 144 (or any
successor provision) under the Securities Act without volume restriction, if
any).
7. Rules 144 and 144A. So long as any Transfer Restricted Securities
------------------
remain outstanding, the Company shall use its reasonable best efforts to file
the reports required to be filed by it under the Securities Act and the Exchange
Act in a timely manner or, upon the request of any Holder of Initial Securities
that are Transfer Restricted Securities, make publicly available other
information so long as necessary to permit sales of such Securities pursuant to
Rules 144 and 144A under the Securities Act. The Company and each Guarantor
covenants that it will use its respective reasonable best efforts to 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 such Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rules 144 and 144A (including the
requirements of Rule 144A(d)(4)). Upon the written request of any Holder of
Initial Securities that are 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 7
shall be deemed to require the Company or any Guarantor to register any of its
securities pursuant to the Exchange Act.
8. Underwritten Registrations. If any of the Transfer Restricted
--------------------------
Securities covered by any Shelf Registration 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
15
<PAGE>
by the Holders of a majority in aggregate principal amount of such Transfer
Restricted Securities to be included in such offering, subject to the consent of
the Company (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.
9. 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, except by the Company and the written
consent of the Holders of a majority in principal amount of the Securities
affected by such amendment, modification, supplement, waiver or consents.
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 the
Holders of Initial Securities, Exchange Securities or Private Exchange
Securities whose Initial 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 Initial Securities,
Exchange Securities or Private Exchange Securities, as the case may be, 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,
facsimile transmission, or air courier which guarantees overnight delivery:
(1) if to a Holder of the Securities, at the most current address
given by such Holder to the Company.
(2) if to the Initial Purchasers:
Banc of America Securities LLC
9 West 57th St., 47th Floor
New York, NY 10019
Fax No.: (212) 847-5038
16
<PAGE>
(3) if to the Company or a Guarantor, at the Company's address as
follows:
North American Van Lines, Inc.
5001 U.S. Highway 30 West
P.O. Box 988
Fort Wayne, IN 46801-0988
Fax: (219) 429-1704
Attention: Chief Financial Officer
with a copy to:
North American Van Lines, Inc.
5001 U.s. Highway 30 West
P.O. Box 988
Fort Wayne, IN 46801-0988
Fax: (219) 429-1704
Attention: General Counsel
and to:
Debevoise & Plimpton
875 Third Avenue
New York, NY 10022
Fax No.: (212) 909-6836
Attention: David Brittenham, Esq.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; three business
days after being deposited in the mail, postage prepaid, if mailed; when receipt
is acknowledged by recipient's facsimile machine operator, if sent by facsimile
transmission; and on the day delivered, if sent by overnight air courier next
day delivery.
(c) No Inconsistent Agreements. Neither the Company nor any
--------------------------
Guarantor has, as of the date hereof, entered into, nor shall it, on or after
the date hereof, enter into, any agreement with respect to its securities that
is inconsistent with the rights granted to the Holders herein or otherwise
conflicts with the provisions hereof
(d) Successors and Assigns. This Agreement shall be binding upon and
----------------------
inure to the benefit of the Company, each other party hereto and each Holder,
and their respective successors and assigns. Each Holder by its acceptance of a
Security, for itself and its successors and assigns, agrees to be bound hereby.
(e) Counterparts. This Agreement may be executed in any number of
------------
counterparts 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.
17
<PAGE>
(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, WITHOUT REGARD
TO ANY PRINCIPLES OF CONFLICT OF LAWS TO THE EXTENT THAT THE APPLICATION OF THE
LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
(h) Severability. If any one or more of the provisions contained
------------
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
(i) Securities Held By the Company. Whenever the consent or approval
------------------------------
of Holders of a specified percentage of principal amount of Securities is
required hereunder, Securities held by the Company or its affiliates (other than
subsequent Holders of Securities if such subsequent Holders are deemed to be
affiliates solely by reason of their holdings of such Securities) shall not be
counted in determining whether such consent or approval was given by the Holders
of such required percentage.
Each party hereto hereby submits to the jurisdiction of the Federal and
state courts in the Borough of Manhattan in the City of New York in any suit or
proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby.
18
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the Initial Purchasers, the Guarantors and the Company in accordance with its
terms.
Very truly yours,
NORTH AMERICAN VAN LINES, INC.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Secretary
FLEET INSURANCE MANAGEMENT, INC.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Vice President
FRONTRUNNER WORLDWIDE, INC.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Vice President
NACAL, INC.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Vice President
NAVTRANS INTERNATIONAL FREIGHT
FORWARDING, INC.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Vice President
<PAGE>
NORTH AMERICAN DISTRIBUTION SYSTEMS, INC.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Vice President
NORTH AMERICAN LOGISTICS, LTD.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Vice President
NORTH AMERICAN VAN LINES OF TEXAS, INC.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Vice President
RELOCATION MANAGEMENT SYSTEMS, INC.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Vice President
GREAT FALLS NORTH AMERICAN, INC.
By: /s/ Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Vice President
<PAGE>
VANGUARD INSURANCE AGENCY, INC.
By: /s/ Robert J. Henry
----------------------------------------
Name: Robert J. Henry
Title: Secretary
ALLIED FREIGHT FORWARDING, INC.
By: /s/ Robert J. Henry
----------------------------------------
Name: Robert J. Henry
Title: Secretary
A RELOCATION SOLUTIONS MANAGEMENT COMPANY
By: /s/ Robert J. Henry
----------------------------------------
Name: Robert J. Henry
Title: Secretary
ALLIED INTERNATIONAL N.A., INC.
By: /s/ Robert J. Henry
----------------------------------------
Name: Robert J. Henry
Title: Vice President
ALLIED VAN LINES TERMINAL COMPANY
By: /s/ Robert J. Henry
----------------------------------------
Name: Robert J. Henry
Title: Secretary
ALLIED VAN LINES, INC.
By: /s/ Robert J. Henry
----------------------------------------
Name: Robert J. Henry
Title: Secretary
<PAGE>
The foregoing Registration Rights Agreement
is hereby confirmed, and accepted and agreed to
as of the date first above written.
BANC OF AMERICA SECURITIES LLC
By: /s/ Brad A. Bernstein
-------------------------------
Name: Brad A. Bernstein
Title: Managing Director
CHASE SECURITIES INC.
By: /s/ Gerald J. Murray
-------------------------------
Name: Gerald J. Murray
Title: Managing Director
<PAGE>
Annex A
Each broker-dealer that receives Exchange Securities for its own account
pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities. The Letter
of Transmittal states that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. This Prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of Exchange Securities received in exchange for Initial Securities
where such Initial Securities were acquired by such broker-dealer as a result of
market-making activities or other trading activities. The Company has agreed
that, for a period of 90 days after the Expiration Date (as defined herein), it
will make this Prospectus available to any Participating Broker-Dealer for use
in connection with any such resale. See "Plan of Distribution."
<PAGE>
Annex B
Each broker-dealer that receives Exchange Securities for its own account
in exchange for Initial Securities, where such Initial Securities were acquired
by such broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Securities. See "Plan of Distribution."
<PAGE>
Annex C
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Securities for its own account
pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by a Participating Broker-Dealer in connection with resales of Exchange
Securities received in exchange for Initial Securities where such Initial
Securities were acquired as a result of market-making activities or other
trading activities. The Company has agreed that, for a period of 90 days after
the Expiration Date, it will make this prospectus, as amended or supplemented,
available to any Participating Broker-Dealer for use in connection with any such
resale. In addition, until , all dealers effecting transactions in the
Exchange Securities may be required to deliver a prospectus.
The Company will not receive any proceeds from any sale of Exchange
Securities by broker-dealers. Exchange Securities received by broker-dealers for
their own account pursuant to the Exchange Offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the Exchange Securities or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer or the purchasers of any such Exchange
Securities. Any broker-dealer that resells Exchange Securities that were
received by it for its own account pursuant to the Exchange Offer and any broker
or dealer that participates in a distribution of such Exchange Securities may be
deemed to be an "underwriter" within the meaning of the Securities Act and any
profit on any such resale of Exchange Securities and any commission or
concessions received by any such persons may be deemed to be underwriting
compensation under the Securities Act. The Letter of Transmittal states that, by
acknowledging that it will deliver and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.
For a period of 90 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any Participating Broker-Dealer that requests
such documents in the Letter of Transmittal. The Company has agreed to pay all
expenses incurred by it incident to the Exchange Offer other than commissions or
concessions of any brokers or dealers and will indemnify the Holders of the
Securities (including any broker-dealers) against certain liabilities, including
liabilities under the Securities Act.
<PAGE>
Annex D
CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL
COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name: _________________________________________________________________
Address: _________________________________________________________________
_________________________________________________________________
If the undersigned is not a broker-dealer, the undersigned represents that it is
not engaged in, and does not intend to engage in, a distribution of Exchange
Securities. If the undersigned is a broker-dealer, including a broker-dealer
that will receive Exchange Securities for its own account in exchange for
Initial Securities that were acquired as a result of market-making activities or
other trading activities, it acknowledges that it will deliver a prospectus in
connection with any resale of such Exchange Securities; however, by so
acknowledging and by delivering a prospectus, the undersigned will not be deemed
to admit that it is an "underwriter" within the meaning of the Securities Act.
<PAGE>
Exhibit 10.1
CONFORMED COPY
================================================================================
ACQUISITION AGREEMENT
between
NA HOLDING CORPORATION
AND
NFC PLC
Dated as of September 14, 1999
================================================================================
<PAGE>
TABLE OF CONTENTS
Articles Page
ARTICLE I
Sale and Purchase of the Target Stock and the Canada Assets,
Subscription and Issuance of the U.K. Shares.............................2
1.1. Sale and Purchase of the Target Stock and the
Canada Assets, Subscription and Issuance of the U.K. Shares.......2
1.2. Closing.................................................4
1.3. Cash Purchase Price Adjustment. .......................5
1.4. Ancillary Agreements, Transfer Documents and Other
Actions...........................................................8
ARTICLE II
Representations and Warranties of the Seller.............................9
2.1. Authorization, etc......................................9
2.2. Corporate Status.......................................11
2.3. Title to Shares, Capitalization, etc...................12
2.4. No Conflicts, etc......................................13
2.5. Investments............................................14
2.6. Financial Statements...................................14
2.7. Undisclosed Liabilities, etc...........................17
2.8. Absence of Changes.....................................18
2.9. Tax Matters............................................21
2.10. Assets.................................................23
2.11. Real Property..........................................23
2.12. Contracts..............................................26
2.13. Intellectual Property..................................27
2.14. Insurance..............................................32
2.15. Litigation.............................................32
2.16. Compliance with Laws and Instruments; Permits;
Consents.........................................................33
2.17. Environmental Matters..................................38
2.18. Affiliate Transactions.................................41
2.19. Employees, Labor Matters, etc..........................41
2.20. U.S. Employee Benefit Plans; ERISA.....................42
2.21. Non-U.S. Plans.........................................45
2.22. UK Pension Scheme......................................45
2.23. [Intentionally Omitted]................................49
2.24. Customers; Agents; Authorized Representatives..........49
2.25. Bank Accounts..........................................50
2.26. Brokers, Finders, etc..................................51
2.27. Disclosure.............................................51
2.28. Acquisition for Investment.............................51
2.29. Seller Actions.........................................51
2.30. No Additional Representations..........................52
2.31. Seller Disclosure Letter...............................52
<PAGE>
ARTICLE III
Representations and Warranties of the Buyer.............................53
3.1. Corporate Status; Authorization, etc...................53
3.2. Capitalization, etc....................................54
3.3. Buyer Financial Statements.............................56
3.4. No Conflicts, etc......................................56
3.5. Undisclosed Liabilities, etc...........................57
3.6. Litigation.............................................58
3.7. Affiliate Transactions.................................58
3.8. Absence of Changes.....................................59
3.9. Tax Matters............................................59
3.10. Assets.................................................59
3.11. Brokers, Finders, etc..................................59
3.12. Purchase for Investment................................60
3.13. Availability of Funds..................................60
3.14. Year 2000..............................................60
3.15. Buyer Disclosure Letter................................61
ARTICLE IV
Covenants of the Seller.................................................62
4.1. Conduct of the Moving Business.........................62
4.2. No Solicitation........................................66
4.3. Access and Information.................................67
4.4. Monthly Financial Information..........................68
4.5. Public Announcements...................................69
4.6. Further Actions........................................69
4.7. Further Assurances.....................................71
4.8. Stockholder Vote; Circular.............................71
4.9. Non-Compete............................................72
4.10. June 1999 Financial Statements.........................78
4.11. Seller Accountants.....................................78
4.12. Trademark Assignments..................................78
4.13. Insurance..............................................79
4.14. European and Asia Pacific Subsidiaries.................81
4.15. U.K. Property Agreement................................81
4.16. Settlement of Intercompany Indebtedness................81
ARTICLE V
Covenants of the Buyer..................................................82
5.1. Public Announcements...................................82
5.2. Further Actions........................................82
5.3. Guarantees, Joint Obligations..........................83
5.4. Conduct of Buyer's Business............................84
5.5. Monthly Financial Information..........................85
5.6. Non-Solicitation.......................................85
5.7. Access and Information.................................85
5.8. Buyer Financing........................................86
5.9. Post-Closing Access to Company Group...................86
5.10. Non-Solicitation As To Moving Business.................86
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ARTICLE VI
Covenants of the Buyer and the Seller...................................87
6.1. Transitional Arrangements..............................87
6.2. Right to Use Certain Marks; Name Changes...............87
6.3. Confidentiality........................................88
6.4. [Intentionally Omitted.]...............................92
6.5. Notice of Developments.................................92
6.6. Employee Matters.......................................93
6.7. Check the Box Elections................................95
6.8. Preferred Stock........................................95
6.9. U.K. Property Agreement Consents.......................96
ARTICLE VII
Conditions to Obligations of Each Party.................................97
7.1. No Injunction, etc.....................................97
7.2. Antitrust Notifications................................97
7.3. Insurance Department Approvals.........................98
ARTICLE VIII
Conditions to Obligations of the Buyer..................................98
8.1. Representations, Performance...........................98
8.2. Consents...............................................99
8.3. Resignation of Directors...............................99
8.4. FIRPTA Certificate.....................................99
8.5. No Material Adverse Effect.............................99
8.6. Transaction Agreements.................................99
8.7. Opinion of Counsel.....................................99
8.8. Financing.............................................100
8.9. Certain Financial Statements..........................100
8.10. Check the Box Elections...............................100
8.11. U.K. Property Agreement...............................100
8.12. Termination of Intercompany Insurance.................100
ARTICLE IX
Conditions to Obligations of the Seller................................100
9.1. Representations, Performance, etc.....................101
9.2. No Buyer Material Adverse Effect......................101
9.3. Opinion of Counsel....................................101
9.4. Transaction Agreements................................102
ARTICLE X
Termination............................................................102
10.1. Termination...........................................102
10.2. Effect of Termination.................................103
ARTICLE XI
Indemnification........................................................105
11.1. Indemnification by the Seller.........................105
11.2. Indemnification by the Buyer..........................107
11.3. Payment Adjustments, etc..............................108
11.4. Indemnification Procedures............................108
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11.5. Survival of Representations and Warranties, etc.......111
11.6. Limitations on Indemnification........................111
11.7. Exclusive Remedy......................................111
11.8. Entities Making Payments..............................112
ARTICLE XII
Definitions............................................................112
12.1. Terms Generally.......................................112
12.2. Certain Terms.........................................113
ARTICLE XIII
Miscellaneous..........................................................136
13.1. Expenses..............................................136
13.2. Notices...............................................137
13.3. Governing Law, etc....................................138
13.4. Binding Effect; Sale of Logistics Business of
the Seller......................................................140
13.5. Assignment............................................140
13.6. No Third Party Beneficiaries..........................140
13.7. Amendment; Waivers, etc...............................141
13.8. Entire Agreement......................................141
13.9. Severability..........................................142
13.10. Headings..............................................142
13.11. Counterparts..........................................142
13.12. Waiver of Jury Trial..................................142
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Exhibits
Exhibit A Form of Certificate of Designation for Junior Exchangeable
Preferred Stock
Exhibit B Form of Common Stock Purchase Warrant
Exhibit C Form of Transition Services Agreement
Exhibit D Form of Amendment No. 1 to Registration and Participation Agreement
Exhibit E Tax Matters Agreement
Exhibit F Form of NFC Letter Agreement
Exhibit G Legal Opinions to be delivered by Counsel to the Seller
Exhibit H Legal Opinions to be delivered by Counsel to the Buyer
Exhibit I Pensions Agreement and Actuary's Letter for NFC Retirement Plan and
Supplementary Pension Scheme
Exhibit J U.K. Property Agreement
Annexes
Annex A Selling Subsidiaries
Annex B Target Subsidiaries
Annex C-1 Transfers of Target Stock
Annex C-2 Subsidiaries of Target Subsidiaries
Annex C-3 Subsidiaries to be Transferred to NFC International Holdings
(Netherlands II) BV
Annex D Allocation of Purchase Price
Annex E-1 Audited Financial Statements - September 30, 1998
Annex E-2 Unaudited Financial Statements - March 31, 1999
Annex F E&Y Engagement Letters
Annex G Pro Forma Statement of Purchase Price Adjustment
Annex H Pre-Sale Reorganization and Disposal Steps for U.K. Restructuring
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ACQUISITION AGREEMENT
ACQUISITION AGREEMENT, dated as of September 14, 1999, between NA HOLDING
CORPORATION, a Delaware corporation (the "Buyer"), and NFC plc, a company
organized under the laws of England and Wales (the "Seller").
W I T N E S S E T H :
WHEREAS, Seller and certain of its Subsidiaries are engaged in the Moving
Business (all capitalized terms in this Agreement having the meanings specified
in Article XII);
WHEREAS, (i) the Subsidiaries of Seller listed on Annex A hereto (each a
"Selling Subsidiary") own (or will own before the Closing) that percentage of
the outstanding shares of capital stock (the "Target Stock") of the Subsidiaries
of Seller listed on Annex B hereto (the "Target Subsidiaries"), (ii) the Seller
indirectly owns all of the outstanding shares of capital stock of Pickfords
Ltd., a company organized under the laws of England and Wales (the "Target U.K.
Subsidiary" and also a "Target Subsidiary") and (iii) NFC Canada Ltd. (the
"Selling Canada Subsidiary" and also a "Selling Subsidiary") owns all of the
assets (the "Canada Assets") used or held for use in connection with the Moving
Business as conducted in Canada;
WHEREAS, the Target U.K. Subsidiary will, upon subscription of $194
million by the Buyer or one or more Subsidiaries of the Buyer (such
Subsidiaries, the "Buying Subsidiaries" and, together with the Buyer, the
"Buying Group"), issue to the Buyer or one or more Buying Subsidiaries such
number of ordinary shares of its common stock (which shall not be less than 100
million shares), par value (pound)1.00 per share (the "U.K. Shares"), as shall
be agreed between the Buyer and the Seller having regard to the
U.S.$/(pound)U.K. exchange rate at the Closing;
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WHEREAS, the Seller and the Selling Subsidiaries wish to sell the Target
Stock and the Canada Assets and the Target U.K. Subsidiary wishes to issue the
U.K. Shares to the Buyer or a Buying Subsidiary and the Buying Group is willing
to purchase the Target Stock and the Canada Assets and to subscribe for the U.K.
Shares;
WHEREAS, the Board of Directors of the Seller has approved the acquisition
of the Target Stock and the Canada Assets by, and the issuance of the U.K.
Shares to, the Buying Group (the "Acquisition"); and
WHEREAS, the Board of Directors of the Seller has determined that the
Acquisition is in the best interests of, the Seller and the stockholders of the
Seller, approved the Acquisition and, if required by applicable Law or stock
exchange regulation, will recommend the approval of the Acquisition and approval
and adoption of this Agreement by the stockholders of the Seller;
NOW, THEREFORE, in consideration of the mutual promises, covenants,
representations and warranties made herein and of the mutual benefits to be
derived herefrom, the parties hereto agree as follows:
ARTICLE I
Sale and Purchase of the Target Stock and the Canada Assets,
Subscription and Issuance of the U.K. Shares
1.1. Sale and Purchase of the Target Stock and the Canada Assets,
Subscription and Issuance of the U.K. Shares. Upon and subject to the terms and
conditions of this Agreement, at the closing of the transactions contemplated by
this Agreement (the "Closing"):
(a) the Seller will, or will cause the respective Selling Subsidiaries to,
transfer and sell or, with respect to any director's qualifying or nominal
shares, shall procure the
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transfer and sale of, and the Buyer will, or will cause one or more Buying
Subsidiaries to, purchase and acquire, the Target Stock as set forth in Annex
C-1 hereto;
(b) the Seller will cause the Target U.K. Subsidiary to issue, and the
Buyer will cause a Buying Subsidiary to subscribe for the U.K. Shares;
(c) the Seller will cause the Selling Canada Subsidiary to sell, convey,
assign, deliver and transfer, and the Buyer will cause a Buying Subsidiary to
purchase, all right, title and interest of the Selling Canada Subsidiary in the
Canada Assets, and the Buyer will cause such Buying Subsidiary to assume and
agree to pay, perform, honor and discharge the Canada Liabilities;
(d) the Buyer shall issue and the Buying Group shall deliver to the Seller
or one of its Affiliates a certificate (the "Common Stock Certificate")
representing 174,961 newly issued shares (the "Common Shares") of common stock,
$0.01 par value per share, of the Buyer (the "Buyer Common Stock");
(e) the Buyer shall file the Certificate of Designation, substantially in
the form of Exhibit A attached hereto, for the Junior Exchangeable Preferred
Stock, $0.01 par value per share (the "Junior Preferred Stock") of the Buyer
with the Secretary of State of the State of Delaware, and upon receipt of
confirmation of the effectiveness of such filing, shall issue and the Buying
Group shall deliver to the Seller or one of its Affiliates a certificate (the
"Junior Preferred Stock Certificate") representing 24,500 shares (the "Preferred
Shares") of Junior Preferred Stock;
(f) the Buyer shall execute and the Buying Group shall deliver to the
Seller or one of its Affiliates a Common Stock Purchase Warrant (the "Warrant")
to purchase 87,480 shares of Buyer Common Stock at an exercise price of $400 per
share, substantially in the form attached hereto as Exhibit B; and
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(g) the Buying Group will pay to the Selling Subsidiaries and the Target
U.K. Subsidiary an aggregate purchase price of $400,000,000 (the "Cash Purchase
Price"), payable in cash in immediately available funds at the Closing in the
manner set forth in Annex C-1 and Section 1.2.
1.2. Closing. The Closing will take place at the offices of Debevoise &
Plimpton, 875 Third Avenue, New York, New York 10022, at 10:00 A.M., New York
City time, on October 29, 1999, provided that all of the conditions set forth in
Articles VII, VIII and IX have been satisfied or waived and, in the event such
conditions have not been satisfied or waived as of such date, then on the
business day following the satisfaction or waiver of all such conditions (the
date on which the Closing occurs, the "Closing Date").
(a) Deliveries by the Seller. Upon and subject to the terms and conditions
of this Agreement, at the Closing, the Seller shall (and the Seller shall cause
each other member of the Selling Group to) deliver, or cause to be delivered, to
the Buying Group: (i) all documents, certificates and agreements necessary to
transfer to the Buyer or a Buying Subsidiary good and marketable title to the
Target Stock, the U.K. Shares and the Canada Assets (the "Transfer Documents")
and all other Ancillary Agreements executed by the respective members of the
Selling Group that are party thereto; (ii) free and clear of any Liens, one or
more certificates, representing the Target Stock and the U.K. Shares or other
instruments of transfer for such Target Stock and the U.K. Shares, each duly
endorsed in blank or accompanied by stock powers or other instruments of
transfer duly executed in blank, and bearing or accompanied by all requisite
stock transfer stamps, as contemplated hereby; and (iii) all other agreements,
documents, instruments and writings required to be delivered by the Seller to
the Buyer at or prior to the Closing pursuant to Article VIII.
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(b) Deliveries by the Buyer. Upon and subject to the terms and conditions
of this Agreement, at the Closing, the Buyer shall (and shall cause each other
member of the Buying Group to) deliver, or cause to be delivered, to the Selling
Group or an Affiliate of the Seller: (i) such Transfer Documents and all other
Ancillary Agreements as shall be required to be executed by the respective
members of the Buying Group; (ii) the Cash Purchase Price by a wire transfer of
immediately available funds to the previously designated account(s) of the
Selling Subsidiaries in accordance with Annex C-1; (iii) free and clear of any
Liens, the Common Stock Certificate and the Preferred Stock Certificate, each
duly registered in the name of the Seller or an Affiliate of the Seller; (iv)
free and clear of any Liens, the Warrant; and (v) all other agreements,
documents, instruments and writings required to be delivered by the Buyer to the
Seller at or prior to the Closing pursuant to Article IX.
(c) Allocation of Purchase Price. At the Closing, the Buyer will pay and
deliver, or cause a member of the Buying Group to pay and deliver, the Cash
Purchase Price, the Common Stock Certificate, the Junior Preferred Stock
Certificate and the Warrant, in the manner set forth in Annex C-1 hereto, to the
Selling Subsidiaries. Except to the extent required by Law, the Buyer and the
Seller agree to file Tax Returns with respect to the purchase and sale of the
Target Stock and the Canada Assets and the subscription for the U.K. Shares in
accordance with the allocation set forth in Annex D hereto.
(d) Excluded Liabilities. Notwithstanding any provision hereof or any
exhibit hereto and regardless of any disclosure to the Buyer, the Buyer shall
not, directly or indirectly through a Buying Subsidiary, assume any Excluded
Canada Liabilities.
1.3. Cash Purchase Price Adjustment. (a) Delivery and Review of Closing
Balance Sheet. As promptly as practicable, but no later than 75 days after the
Closing
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Date, the Seller will cause to be prepared and delivered to the Buyer (i) the
Closing Balance Sheet, accompanied by the auditors' report thereon from the
Seller Accountants and (ii) a certificate of the Seller, setting forth the
Closing Controllable Net Assets, together with supporting calculations in
reasonable detail (the "Adjustment Certificate"). The Closing Balance Sheet
shall be prepared in accordance with United Kingdom generally accepted
accounting principles ("U.K. GAAP") and, except for the application of Financial
Reporting Standards ("FRS") 10 and 12, in a manner that is consistent with the
September 1998 Balance Sheet. The Buyer shall have 45 days from the date on
which the Closing Balance Sheet and the Adjustment Certificate are delivered to
it to review such documents (the "Review Period"). The Buyer and its accountants
shall be provided with reasonable access during normal business hours to the
audit working papers of the Seller Accountants in connection with such review.
If the Buyer disagrees in any respect with any item or amount shown or reflected
in the Closing Balance Sheet or the Adjustment Certificate or with the
calculation of the Closing Controllable Net Assets, the Buyer may, on or prior
to the last day of the Review Period, deliver a notice to the Seller setting
forth, in reasonable detail, each disputed item or amount and the basis for the
Buyer's disagreement therewith (the "Dispute Notice"). If no Dispute Notice is
received by the Seller on or prior to the last day of the Review Period, the
Closing Balance Sheet and the Adjustment Certificate shall be deemed accepted by
the Buyer. Any items not identified in the Dispute Notice will be deemed
accepted by the Buyer and the Seller and, notwithstanding the review of the
matters set forth in the Dispute Notice by the Accountant as set forth in
Section 1.3(b) below, shall be deemed part of the Closing Balance Sheet. The
Buyer's rights to indemnification pursuant to Section 11.1 (and any limitations
on such rights) shall not be deemed to limit, supersede or otherwise affect the
Buyer's rights to a full purchase price adjustment pursuant to this Section 1.3.
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(b) The Accountant. If the matters identified in the Dispute Notice have
not been resolved by the mutual agreement of the parties, then within 15 days
after the Seller's receipt of a Dispute Notice, the Buyer and the Seller shall
jointly contact the U.K. office of Arthur Andersen LLP (the "Accountant") and
shall retain the Accountant to resolve the issues set forth in the Dispute
Notice. The Accountant shall conduct such review of the Closing Balance Sheet,
any related work papers of the Seller Accountants, the Adjustment Certificate
and the Dispute Notice, and any supporting documentation as the Accountant in
its sole discretion deems necessary, provided that each of the Buyer and the
Seller shall be limited to one written summary of its respective position as to
the items contained in the Dispute Notice. Notwithstanding the foregoing, the
Accountant's review of the Closing Balance Sheet shall be limited to the matters
set forth in the Dispute Notice and the Accountant shall make its determination
in a manner consistent with this Agreement.
(c) The Adjustment Report. The Accountant shall, as promptly as
practicable and in no event later than 45 days following the date of its
retention, deliver to the Buyer and the Seller a report (the "Adjustment
Report"), in which the Accountant shall, after considering all matters set forth
in the Dispute Notice, determine what adjustments, if any, should be made to the
Closing Balance Sheet in order for it to comply with this Section 1.3, and shall
determine the appropriate Closing Controllable Net Assets on that basis. The
Adjustment Report shall set forth, in reasonable detail, the Accountant's
determination with respect to each of the disputed items or amounts specified in
the Dispute Notice, and the revisions, if any, to be made to the Closing Balance
Sheet, the Adjustment Certificate and the Closing Controllable Net Assets,
together with supporting calculations. The Seller shall pay one-half, and the
Buyer shall pay one-half, of the fees and expenses of the Accountant incurred in
connection with the
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matters referred to in this Section 1.3. The Adjustment Report shall be final
and binding upon the Buyer and the Seller, and shall be deemed a final
arbitration award that is enforceable pursuant to the terms of the Federal
Arbitration Act, 9 U.S.C. ss.ss. 1 et seq.
(d) Adjustment and Payment. Effective upon the end of the Review Period
(if a timely Dispute Notice is not delivered), or upon the resolution of all
matters set forth in the Dispute Notice by agreement of the parties or by the
issuance of the Adjustment Report (if a timely Dispute Notice is delivered), the
Cash Purchase Price shall be reduced by the amount, if any, by which the Closing
Controllable Net Assets is less than (pound) 92,400,000, or increased by the
amount, if any, by which the Closing Controllable Net Assets is greater than
(pound) 92,400,000. Any adjustment to the Cash Purchase Price pursuant to this
Section 1.3 shall be paid by the Buyer or the Seller, as the case may be, on the
fifth business day following the end of the Review Period (if a timely Dispute
Notice is not delivered), or five business days after the date on which the
Adjustment Report has been received by the Seller and the Buyer (if a timely
Dispute Notice is delivered). Any such payment shall be made by wire transfer of
immediately available funds to the account or accounts of the Seller or the
Buyer, as the case may be, such account or accounts designated in accordance
with the notice provisions of Section 13.2 at least two business days prior to
the date on which such payment is scheduled to be made and shall be increased by
interest from the Closing Date to and including the date of payment calculated
at 1% plus The Chase Manhattan Bank prime rate. Any purchase price adjustment
paid in accordance with this Section 1.3 shall result in a corresponding
adjustment to the allocation set forth on Annex D.
1.4. Ancillary Agreements, Transfer Documents and Other Actions. Subject
to the terms and conditions hereof, the Seller will, and will cause the
respective Selling Subsidiaries and the Target U.K. Subsidiary to, and the Buyer
will, and will cause the
8
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respective Buying Subsidiaries to, enter into the Ancillary Agreements and such
other documents, including the Transfer Documents, providing for the sale,
transfer, issuance, assignment or other direct or indirect conveyance of the
Target Stock, the U.K. Shares and the Canada Assets as may be required to
satisfy the requirements of applicable Laws and carry out the formalities and
proceedings as may be required in the relevant jurisdictions in order to give
effect to the purposes and intents of this Agreement and to consummate the
transactions contemplated hereby.
ARTICLE II
Representations and Warranties of the Seller
The Seller represents and warrants to the Buyer as follows, as of the date
hereof and as of the Closing Date:
2.1. Authorization, etc. (a) Seller. Subject to approval, if necessary, by
the stockholders of the Seller in accordance with the rules, published from time
to time, of the London Stock Exchange Limited, the Seller has full corporate
power and corporate authority to execute and deliver this Agreement and, to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement, the
performance of the Seller's obligations hereunder, and the consummation of the
transactions contemplated hereby, have been duly authorized by all requisite
corporate action of the Seller and, except for the approval of the transactions
hereunder by the stockholders of the Seller in accordance with the rules,
published from time to time of the London Stock Exchange Limited, no other
corporate proceedings on the part of the Seller are necessary. The Seller has
duly executed and delivered this Agreement. This Agreement constitutes the
legal, valid and binding obligation of the Seller enforceable against the Seller
in accordance with its terms, except to the extent that enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium,
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fraudulent transfer or other similar laws of general applicability relating to
or affecting the enforcement of creditors' rights and by the effect of general
principles of equity (regardless of whether enforceability is considered in a
proceeding in equity or at law).
(b) Selling Group. Each member of the Selling Group that is to be a party
to a Transaction Agreement has full corporate power and corporate authority to
execute and deliver the Transaction Agreement to which such member shall be a
party, to perform such member's obligations thereunder and to consummate the
transactions contemplated thereby. The execution and delivery of each
Transaction Agreement to which such member shall be a party, the performance of
such member's obligations thereunder, and the consummation of the transactions
contemplated thereby, have been duly authorized by all requisite corporate
action of such member. Each such member of the Selling Group on the Closing Date
will have duly executed and delivered each Transaction Agreement to which such
member shall be a party. Each Transaction Agreement when so executed and
delivered will constitute the legal, valid and binding obligation of each such
member of the Selling Group party thereto, enforceable against each such member
party thereto in accordance with its respective terms, except to the extent that
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other similar laws of general applicability
relating to or affecting the enforcement of creditors' rights and by the effect
of general principles of equity (regardless of whether enforceability is
considered in a proceeding in equity or at law).
(c) Target U.K. Subsidiary. The Target U.K. Subsidiary has not engaged in
any business activities or conducted any operations other than in connection
with the transactions contemplated by this Agreement and the acquisition of
certain assets in connection with the Restructuring Transactions.
10
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(d) Insurance Subsidiaries. Section 2.1(d) of the Seller Disclosure Letter
lists the name and domiciliary jurisdiction of each member of the Company Group
that is licensed to write insurance in any jurisdiction (the "Insurance
Subsidiaries").
2.2. Corporate Status. (a) Organization. The Seller and each of the Target
Subsidiaries and the Selling Subsidiaries is a corporation duly organized,
validly existing and, with respect to U.S. corporate entities, in good standing
under the laws of its respective jurisdiction of incorporation. Each of the
Selling Subsidiaries and the Company Group have all requisite corporate power
and corporate authority to own or lease its properties and to conduct its
business as currently being conducted.
(b) Qualification. Except as set forth in Section 2.2(b) of the Seller
Disclosure Letter, each member of the Company Group is duly qualified or
licensed and, with respect to U.S. corporate entities, in good standing to do
business in each of the jurisdictions specified in Section 2.2(b) of the Seller
Disclosure Letter, which includes each jurisdiction in which the nature of its
business or the properties owned or leased by it makes such qualification or
licensing necessary, other than where the failure to obtain such qualification
or licensing, individually and in the aggregate, has not had or resulted in a
Material Adverse Effect.
(c) Organizational Documents. The Seller has delivered or made available
to the Buyer complete and correct copies of the Organizational Documents and
minute books of each member of the Company Group, as amended, modified or waived
through and in effect on the date hereof. Each of the Organizational Documents
of each member of the Company Group is in full force and effect. No member of
the Company Group is in violation of any of the provisions of its Organizational
Documents.
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(d) Subsidiaries of Target Subsidiaries. Annex C-2 sets forth a complete
and correct list, by Target Subsidiary, of all Subsidiaries of the Target
Subsidiaries, along with an indication of such Subsidiary's jurisdiction of
organization.
2.3. Title to Shares, Capitalization, etc. (a) Title. Except as set forth
in Section 2.3(a) of the Seller Disclosure Letter, the Seller owns, directly or
indirectly, beneficially and of record, the Target Stock, free and clear of any
Liens. Upon the delivery of and payment for the Target Stock at the Closing as
provided for in this Agreement and the Transfer Documents and except as set
forth in Section 2.3(a) of the Seller Disclosure Letter, the Buyer will acquire,
directly or indirectly through the Buying Subsidiaries, good and valid title to
100% of the outstanding shares of the capital stock of each member of the
Company Group, free and clear of any Liens other than any Lien created by the
Buyer. Upon payment by the applicable member of the Buying Group of the
subscription price for the U.K. Shares, the U.K. Shares shall be duly
authorized, validly issued and fully paid. There are no issued and outstanding
shares of capital stock of the Target Subsidiaries other than (x) the Target
Stock, (y) in the case of Allied Arthur Pierre NV (six shares held by Menkes
Movers NV), Allied Arthur Pierre SA (one share held by Menkes Movers NV), Arthur
Pierre SA (one share held by each of NFC International Holdings (Belgium) NV,
NFC Investments (Netherlands) BV, Herwin Custers, Ludo de Laey and Michael
Mason), Allied Pickfords LLC (UAE) (51% of capital stock held by AM A. Jasem),
NFC New Zealand Limited (one share held by Graham Sutcliffe), Allied Pickfords
Limited (NZ) (one share held by Graham Sutcliffe), Trans International Moving &
Shipping (NZ) 1992 Limited (one share held by Graham Sutcliffe) and A.L. Movers
Private Limited (55% of capital stock held by Lemuir Packers Private Limited),
and (z) in the case of Target U.K. Subsidiary, two (2) shares of its capital
stock
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which are owned by Realcause Limited (a company organized under the laws of
England and Wales).
(b) Authorized Capital Stock of the Company Group. Section 2.3(b) of the
Seller Disclosure Letter sets forth a complete and correct list of the
authorized capital stock of each member of the Company Group and the number of
shares that are issued and outstanding. All outstanding shares of the capital
stock of each member of the Company Group have been duly authorized and validly
issued and are fully paid and nonassessable and are owned directly by the
Selling Subsidiaries or the Target Subsidiaries, as the case may be, listed on
Section 2.3(b) of the Seller Disclosure Letter (except as may be provided in the
Illinois Insurance Code), free and clear of all Liens.
(c) No Equity Rights. There are no preemptive or similar rights on the
part of any holders of any class of securities of any member of the Company
Group. Except for this Agreement, no subscriptions, options, warrants,
conversion or other rights, agreements, commitments, arrangements or
understandings of any kind obligating any member of the Selling Group or the
Company Group or any other Person, contingently or otherwise, to issue or sell,
or cause to be issued or sold, any shares of capital stock of any class of any
member of the Company Group, or any securities convertible into or exchangeable
for any such shares, are outstanding, and no authorization therefor has been
given. There are no outstanding contractual or other rights or obligations to or
of any member of the Selling Group or any other Person to repurchase, redeem or
otherwise acquire any outstanding shares or other equity interests of any member
of the Company Group.
2.4. No Conflicts, etc. Except as set forth in Section 2.4 of the Seller
Disclosure Letter, the execution, delivery and performance of this Agreement and
the Transaction Agreements by each member of the Selling Group party thereto,
and the
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consummation of the transactions contemplated hereby and thereby, do not
conflict with, contravene, result in a violation or breach of or default under
(with or without the giving of notice or the lapse of time or both), create in
any other Person a right or claim of termination, amendment, or require
modification, acceleration or cancellation of, or result in the creation of any
Lien (or any obligation to create any Lien) other than Permitted Liens upon any
of the properties or assets of any member of the Selling Group or the Company
Group under, (a) any Law applicable to any member of the Selling Group or the
Company Group or any of their respective properties or assets, (b) any provision
of any of the Organizational Documents of any member of the Selling Group or the
Company Group or (c) any Contract, or any other agreement or instrument to which
any member of the Selling Group or the Company Group is a party or by which any
of their respective properties or assets may be bound, except, in the case of
clauses (a) and (c), for violations, breaches or defaults that, individually and
in the aggregate, have not had or resulted in a Material Adverse Effect.
2.5. Investments. No member of the Company Group owns any shares of
capital stock or other securities of, or interest in, any other Person, except
as set forth in Section 2.5 of the Seller Disclosure Letter.
2.6. Financial Statements (a) Audited Financial Statements. The Seller has
delivered to the Buyer true and correct copies of the Audited Financial
Statements, a copy of which is attached hereto as Annex E-1. The Audited
Financial Statements are complete and correct in all material respects, were
prepared from, and are in accordance with the books and records of the Company
Group, and have been prepared in accordance with United Kingdom generally
accepted accounting principles ("U.K. GAAP") applied on a consistent basis
throughout the periods presented in the Audited Financial Statements. The
combined balance sheets included in the Audited Financial Statements present
fairly in
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all material respects the financial position of the Company Group as at the
respective dates thereof, and combined profit and loss accounts, combined
statements of total recognized gains and losses, combined cash flow statements
and combined statements of changes in NFC Group Investment included in such
Audited Financial Statements present fairly in all material respects the results
of operations and cash flows of the Company Group for the respective periods
indicated. Except as set forth in Section 2.6(a) of the Seller Disclosure Letter
(which disclosure shall include a description and the amount of such asset or
liability), the combined balance sheets included in the Audited Financial
Statements do not include any material assets or liabilities not intended to
constitute a part of the Company Group after giving effect to the transactions
contemplated hereby. The combined profit and loss accounts, combined statements
of total recognized gains and losses, combined cash flow statements and combined
statements of changes in NFC Group Investment included in the Audited Financial
Statements do not reflect the operations of any entity or business not intended
to constitute a part of the Moving Business after giving effect to all such
transactions. The combined profit and loss accounts included in the Audited
Financial Statements reflect all of the material costs and expenses incurred in
connection with the Moving Business, including those incurred in generating the
revenues reflected in the Audited Financial Statements, in each case, for the
periods covered thereby, that would be required to be so reflected under U.K.
GAAP in combined financial statements of the Company Group.
(b) Unaudited Financial Statements. The Seller has delivered to the Buyer
true and correct copies of the Unaudited Financial Statements, a copy of which
is attached hereto as Annex E-2. The Unaudited Financial Statements are complete
and correct in all material respects, were prepared from, and are in accordance
with the books and records of the Company Group, and have been prepared in
accordance with U.K. GAAP applied
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on a consistent basis throughout the periods presented in the Unaudited
Financial Statements (except for the application of F.R.S. 10), subject only to
normal recurring year-end adjustments.
(c) Monthly Financial Information. The Seller has delivered to the Buyer
complete and correct copies of the monthly management financial information
(which consists of turnover/operating profit by sector statements of the Company
Group for the U. K., Europe, the Americas and the Asia Pacific regions), of the
Moving Business as of and for each of the monthly periods from October 1, 1998
through June 30, 1999 that the Seller prepares in the ordinary course of
business (the "Management Reports"). The Management Reports were prepared from,
and are in accordance with, the books and records of the Company Group. The
Seller has delivered to the Buyer complete and correct copies of a combining
profit and loss statement by geographic region of the Company Group ("Monthly
Combining Profit and Loss Statement") as of and for the months ended March 31,
1999 and June 30, 1999 and such statements were prepared from, and in accordance
with, the books and records of the Company Group.
(d) E&Y Engagement Letter. The Seller has duly executed and delivered the
engagement letters dated September 11, 1999 and September 13, 1999 with Ernst &
Young, copies of which are attached hereto as Annex F.
(e) Statutory Financial Statements. (i) The Seller has delivered to the
Buyer true and complete copies of the statutory financial statements of each
member of the Company Group for the three years ended September 30, 1998 (or
such other accounting period referenced therein). Section 2.6(f) of the Seller
Disclosure Letter sets forth a complete and correct list of all statutory
reporting entities within the Company Group.
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(ii) The Seller has delivered to the Buyer true and complete copies of the
annual statements of each of the Insurance Companies as filed with the
applicable insurance regulatory authorities for the years ended December 31,
1996, 1997 and 1998 (or other applicable filing date), including all exhibits,
interrogatories, notes, schedules and any actuarial opinions, affirmations or
certifications or other supporting documents filed in connection therewith
(collectively, including any such annual or quarterly statements filed
subsequent to the date hereof, the "SAP Statements"). The SAP Statements were
prepared in conformity with statutory accounting practices prescribed or
permitted by the applicable insurance regulatory authority ("SAP") consistently
applied for the periods covered thereby and present (or will present) fairly the
statutory financial position of such Insurance Companies as at the respective
dates thereof and the results of operations of such Insurance Companies for the
respective periods then ended. The SAP Statements complied (or will comply) in
all material respects with all applicable Laws, rules and regulations when
filed, and, to the Seller's Knowledge, no material deficiency has been asserted
with respect to any SAP Statements by the applicable insurance regulatory body
or any other governmental agency or body. The statutory balance sheets and
income statements included in the annual SAP Statements have been audited by the
Seller Accountants, and Seller has delivered or made available to Buyer true and
complete copies of all audit opinions related thereto. Seller has made available
to Buyer true and complete copies of all examination reports of insurance
departments and any insurance regulatory agencies since January 1, 1995 relating
to the Insurance Companies.
2.7. Undisclosed Liabilities, etc. No member of the Company Group has any
liabilities or obligations of any nature, whether known, unknown, absolute,
accrued, contingent or otherwise and whether due or to become due, except (a) as
set forth in Section 2.7 of the Seller Disclosure Letter, (b) as and to the
extent disclosed or reserved
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against in the September 1998 Balance Sheet or specifically disclosed in the
notes thereto or in the Unaudited Balance Sheet and (c) for liabilities and
obligations that (i) are incurred after the date of the Unaudited Balance Sheet
in the ordinary course of business consistent with prior practice and are not
prohibited by Section 4.1 (none of which are incurred as a result of breach of
contract, willful misconduct or gross negligence) and (ii) individually and in
the aggregate have not had or resulted in a Material Adverse Effect.
2.8. Absence of Changes. Since March 31, 1999 until the date of this
Agreement, except as set forth in Section 2.8 of the Seller Disclosure Letter,
the Seller, each of the Selling Subsidiaries and each member of the Company
Group has conducted the Moving Business in the ordinary course of business
consistent with past practice in all material respects and no member of the
Selling Group or the Company Group has, on behalf of, in connection with or
relating to the Moving Business:
(a) declared, set aside, made or paid any dividend or other
distribution in respect of its capital stock or otherwise purchased or
redeemed, directly or indirectly, any shares of its capital stock;
(b) issued or sold any shares of any class of its capital stock, or
any securities convertible into or exchangeable for any such shares, or
issued, sold, granted or entered into any subscriptions, options,
warrants, conversion or other rights, agreements, commitments,
arrangements or understandings of any kind, contingently or otherwise, to
purchase or otherwise acquire any such shares or any securities
convertible into or exchangeable for any such shares;
(c) incurred any indebtedness for borrowed money, issued or sold any
debt securities or prepaid any debt (including, without limitation, any
borrowings from or prepayments to any member of the Selling Group) except
for borrowings and repayments in the ordinary course of business;
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(d) mortgaged, pledged or otherwise subjected to any Lien, any of
its Real Property or other properties or assets, tangible or intangible,
except for Permitted Liens in the ordinary course of business;
(e) forgiven, canceled, compromised, waived or released any debts,
claims or rights, except for debts, claims and rights against Persons
(other than any member of the Selling Group), forgiven, canceled,
compromised, waived or released in the ordinary course of business or
which would not exceed $100,000 in the aggregate;
(f) modified any existing Material Contract or entered into (x) any
agreement, commitment or other transaction, other than agreements entered
into in the ordinary course of business and involving an expenditure of
less than $1,000,000 in each case and $10,000,000 in the aggregate, or
(y) any material agreement or commitment that, pursuant to its terms, is
not cancelable without penalty on less than 60 days' notice;
(g) paid any material bonus to any officer, director, employee,
sales representative, agent or consultant of the Company Group, or granted
to any officer, director, employee, sales representative, agent or
consultant of the Company Group any other increase in compensation in any
form other than in the ordinary course of business consistent with past
practice or pursuant to an existing contract;
(h) entered into, adopted or materially amended any employment,
consulting, retention, change-in-control, collective bargaining, bonus or
other incentive compensation, profit-sharing, health or other welfare,
stock option or other equity, pension, retirement, vacation, severance,
deferred compensation or other employment, compensation or benefit plan,
policy, agreement, trust, fund or arrangement for the benefit of any
officer, director, employee, Agent, Authorized Agent, Owner/Operator,
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agent, consultant or Affiliate (whether or not legally binding) other than
in the ordinary course of business consistent with past practice or as
required by law;
(i) suffered any material damage, destruction or loss (whether or
not covered by insurance), or any strike or other material
employment-related problem, or any material change in relations with or
any loss of a material supplier, customer, Agent, Authorized
Representative, Owner/Operator or employee, nor has any Material Adverse
Effect occurred;
(j) amended any of its Organizational Documents;
(k) changed in any material respect its accounting practices,
policies or principles;
(l) incurred, assumed, guaranteed or otherwise become directly or
indirectly liable with respect to any liability or obligation in excess of
$1,000,000 in each case or $10,000,000 in the aggregate at any one time
outstanding (whether absolute, accrued, contingent or otherwise and
whether direct or indirect, or as guarantor or otherwise with respect to
any liability or obligation of any other Person);
(m) transferred or granted any rights or licenses under, or entered
into any settlement regarding the infringement of, Owned Intellectual
Property;
(n) sold any assets with a value in excess of $250,000 in each case
or $2,000,000 in the aggregate;
(o) conducted its tax affairs other than (i) in the ordinary course
of business and consistent with past practice, (ii) in good faith and
(iii) in substantially the same manner as such affairs would have been
conducted if this Agreement (and the transactions contemplated by this
Agreement and the disposition by the Seller Group of any member of the
Company Group) had not been contemplated or proposed, except where the
failure to conduct such tax affairs in such manner would not
20
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reasonably be expected to result in any material increase in the Tax
payable by any member of the Company Group for any taxable period (or
portion thereof) beginning after the Closing Date (other than an increase
attributable to a Restructuring Transaction for which the Seller would be
responsible under the Tax Matters Agreement); or
(p) taken any action or omitted to take any action that would
reasonably be expected to result in the occurrence of any of the
foregoing.
2.9. Tax Matters. (a) Tax Returns and Payments of Taxes. Except as set
forth in Section 2.9(a) of the Seller Disclosure Letter, (i) with respect to
members of the Company Group organized or operating in the United States, the
United Kingdom, Ireland or Australia and, to the Knowledge of the Seller, with
respect to each other member of the Company Group, all material Tax Returns
relating to such member have been filed that are required to have been filed,
(ii) as of the time of filing, each such Tax Return correctly reflected the
facts regarding the income, business, assets and operations, activities and the
status of each member of the Company Group in all material respects, (iii) all
Taxes shown as owing on any filed Tax Return relating to a member of the Company
Group or the Moving Business or the assets thereof (and that are actually due to
have been paid) have been paid, except as, individually and in the aggregate,
have not had or resulted in a Material Adverse Effect, (iv) all other material
Taxes that are required to have been paid by any member of the Company Group
have been paid, except as, individually and in the aggregate, have not had or
resulted in a Material Adverse Effect, (v) each member of the Company Group has
duly and timely collected or withheld (or there has been collected or withheld
on their behalf) all Taxes required to be collected or withheld by such member
in connection with the Moving Business or assets of such member, and such
collected or withheld Taxes have been either duly and timely paid to the proper
governmental
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authorities or properly set aside in accounts for such purpose, except as,
individually and in the aggregate, have not had or resulted in a Material
Adverse Effect, (vi) there are no outstanding liens for material Taxes (other
than Permitted Liens) upon the assets of any member of the Company Group and
(vii) no amount will be required to be withheld under Section 1445 of the Code
in connection with any of the transactions effected on the Closing Date.
(b) Tax Audits, Etc. Except as set forth in Section 2.9(b) of the Seller
Disclosure Letter, with respect to members of the Company Group organized or
operating in the United States, the United Kingdom, Ireland or Australia and, to
the Knowledge of the Seller, with respect to each other member of the Company
Group (i) there has been no material claim or issue (other than a claim or issue
that has been finally settled) concerning any liability for Taxes of any member
of the Company Group asserted or raised in writing by any Governmental
Authority, (ii) no person has waived any statute of limitations relating to
material Taxes of any member of the Company Group, agreed to any extension of
the period for assessment or collection of any such Taxes or executed or filed
any power of attorney with respect to any such Taxes, which waiver, agreement or
power of attorney is currently in force, (iii) there are no material outstanding
adjustments for Income Tax purposes applicable to any member of the Company
Group required as a result of changes in methods of accounting effected on or
before the Closing Date, and (iv) no member of the Company Group is a party to
or bound by or has any obligation under any material Tax allocation, sharing,
indemnity or similar agreement or arrangement (other than the Tax Matters
Agreement) that will continue in force after the Closing Date or is or has been
a member of any group of companies filing a consolidated, combined or unitary
Tax Return.
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(c) No member of the Company Group (other than a Designated Target that
makes an election pursuant to Section 6.7 and 8.10) has made or filed an
election with respect to its classification for U.S. federal income tax purposes
pursuant to U.S. Treasury Regulation ss. 301.7701-3.
2.10. Assets. Except for the Real Property (which is addressed in Section
2.11) and as set forth in Section 2.10 of the Seller Disclosure Letter, the
Company Group owns, or otherwise has sufficient and legally enforceable rights
to use in all material respects, all of the properties and assets (personal or
mixed, tangible or intangible), used in connection with, necessary for the
conduct of, or otherwise material to, the Moving Business as conducted during
the past twelve months (the "Assets"). Except for the Real Property (which is
addressed in Section 2.11), the Company Group has good and valid title to, or in
the case of leased property has good and valid leasehold interests in, all
Assets that are material to the Moving Business, including but not limited to
all such Assets reflected in the Unaudited Balance Sheet or acquired since the
date thereof (except as may be disposed of in the ordinary course of business
after the date thereof and in accordance with this Agreement), in each case free
and clear of any Lien other than Permitted Liens. The Company Group has
maintained all tangible Assets that are material to the Moving Business in
accordance with industry standards and such material Assets are in reasonable
repair, subject only to ordinary wear and tear, except where such failure to
maintain, individually and in the aggregate, has not had and would not
reasonably be expected to have or result in a Material Adverse Effect.
2.11. Real Property. (a) Owned Real Property. Section 2.11(a)(i) of the
Seller Disclosure Letter contains a complete and correct list of all Owned Real
Property setting forth the address and owner of each parcel of Owned Real
Property. Except as set forth in Section 2.11(a)(ii) of the Seller Disclosure
Letter, the Company Group has good
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and marketable fee simple title to the Owned Real Property, for the purposes for
which such Owned Real Property is currently used, free and clear of any Liens
other than Permitted Liens.
(b) Leases. Section 2.11(b) of the Seller Disclosure Letter contains a
complete and correct list of all Leases setting forth the address, landlord and
tenant for each Lease. The Seller has delivered to the Buyer correct and
complete copies of the Leases. Each Lease is legal, valid, binding, in full
force and effect and enforceable against each party thereto, except to the
extent that any failure to be so enforceable, individually and in the aggregate,
has not had or resulted in a Material Adverse Effect. No member of the Selling
Group or the Company Group is, and, to the Knowledge of the Seller, no other
party is, in default, violation or breach in any respect under any Lease, and no
event has occurred and is continuing that constitutes or, with notice or the
passage of time or both, would constitute a default, violation or breach in any
respect under any Lease, except for such defaults, violations or breaches that,
individually and in the aggregate, have not had or resulted in a Material
Adverse Effect. Each Lease grants the tenant under the Lease the exclusive right
to use and occupy the premises and rights demised and intended to be demised
thereunder. Each leasehold estate of the Company Group under its respective
Leases is free and clear of any Liens other than Permitted Liens.
(c) Fee and Leasehold Interests, etc. The Real Property and the New Lease
Property constitute all the real property held by the Company Group that is used
by the Company Group in connection with the Moving Business as conducted during
the past twelve months.
(d) Compliance with Laws. The existing zoning of each Owned Real Property
and Leased Real Property is sufficient for the conduct of the Moving Business of
the Company Group (as it has been conducted during the last twelve months) at
each of
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these properties. No member of the Company Group has received written notice of
any violation of any zoning, building or other land use or similar laws, except
for such violations which, individually and in the aggregate, have not had or
resulted in a Material Adverse Effect.
(e) Condemnation; Litigation. Except as set forth in Section 2.11(e) of
the Seller Disclosure Letter, the Owned Real Property and the Leased Real
Property are not the subject of any condemnation or similar proceedings in
eminent domain, or any litigation or arbitration proceedings which would have a
Material Adverse Effect on the conduct of the Moving Business of the Company
Group at each of these properties.
(f) Real Property Consents. Except as set forth in the U.K. Property
Agreement or Section 2.11(f) of the Seller Disclosure Letter, the execution,
delivery and performance of this Agreement and the Transaction Agreements by
each member of the Selling Group party thereto, and the consummation of the
transactions contemplated hereby and thereby, do not and will not require the
Consent of any Person pursuant to any of the Leases or any instrument of record
or agreement affecting the Real Property, except where the failure to obtain
such Consent, individually and in the aggregate, has not had or resulted in a
Material Adverse Effect. Except as set forth in Section 2.11(f) of the Seller
Disclosure Letter, the enforceability of the Leases will not be affected in any
manner by the execution, delivery or performance of this Agreement, and no Lease
contains any change in control provision or other terms or conditions that will
become applicable or inapplicable as a result of the consummation of the
transactions contemplated by this Agreement and the Transaction Agreements,
except where such effect or provision (whether related to enforceability or
change of control), individually or in the aggregate, would not have or result
in a Material Adverse Effect.
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(g) Category 2 Leases. The Category 2 Leases, when granted, will be free
and clear of any Liens other than Permitted Liens.
2.12. Contracts. (a) Disclosure. Except as set forth in Schedule 2.12(a),
as of the date of this Agreement, no member of the Company Group or the Selling
Group is a party to any: (i) consulting agreement relating to the Moving
Business requiring any payment in excess of $100,000 per annum or employment
agreement relating to the Moving Business (with a Person other than a Retained
Employee); (ii) indenture, mortgage, note, installment obligation, loan
agreement, letter of credit, security agreement, pledge agreement, deed of
trust, bond, agreement or other instrument relating to Indebtedness of any
member of the Company Group; (iii) Contract between any member of the Company
Group or any member of the Selling Group and any (A) one of the top 50 Agents
based on linehaul revenue for the six months ended March 31, 1999 or (B) one of
the top 50 Authorized Representatives based on linehaul revenue for the six
months ended March 31, 1999; or (iv) other Contract (other than those Contracts
within the categories specified in clauses (i), (ii) and (iii)) which would
reasonably be expected to result in the receipt or payment after the date hereof
of more than $500,000 on an annual basis (the Contracts set forth on Schedule
2.12(a) of the Seller Disclosure Letter and described in any of clauses (i)
through (iv), the "Material Contracts"). The Seller has delivered to the Buyer
complete and correct copies of all written Material Contracts, and accurate
descriptions of all material terms of all oral Material Contracts, set forth or
required to be set forth in Section 2.12(a) of the Seller Disclosure Letter. No
member of the Company Group nor any member of the Selling Group, with respect to
the Moving Business, is a party to any contract that restricts the ability of
any member of the Company Group to engage in any business in any geographic
area.
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(b) Enforceability. Except as set forth in Schedule 2.12(b) of the Seller
Disclosure Letter, all Material Contracts are legal, valid, binding, in full
force and effect and enforceable against each party thereto, except to the
extent that any failure to be enforceable, individually and in the aggregate,
has not had or resulted in a Material Adverse Effect. Except as set forth in
Section 2.12(b) of the Seller Disclosure Letter, there does not exist under any
Material Contract any violation, breach or event of default, or event or, to the
Seller's Knowledge, condition that, after notice or lapse of time or both, would
constitute a violation, breach or event of default thereunder, on the part of
any member of the Company Group or to the Seller's Knowledge, any other Person,
other than such violations, breaches or defaults which, individually or in the
aggregate, have not had or resulted in a Material Adverse Effect. Except as set
forth in Section 2.12(b) of the Seller Disclosure Letter, the enforceability of
all Material Contracts will not be affected by the execution, delivery or
performance of this Agreement or any of the Transaction Agreements, and no
Material Contract contains any change in control or other terms or conditions
that will become applicable or inapplicable as a result of the consummation of
the transactions contemplated by this Agreement and the Transaction Agreements,
except where such effect or provision (whether related to enforceability or
change of control), individually or in the aggregate, would not have or result
in a Material Adverse Effect.
(c) Except as disclosed in Schedule 2.12(c), no member of the Selling
Group or the Company Group is restricted in any material respect by any Material
Contract or other instrument from carrying on the Moving Business as presently
conducted.
2.13. Intellectual Property. (a) Disclosure. Section 2.13(a) of the Seller
Disclosure Letter sets forth a complete and correct list of all material
Intellectual Property that is owned by any member of the Company Group (the
"Owned Intellectual Property"), except for any Owned Intellectual Property that
consists of (i) inventions, trade secrets,
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know-how, processes, formulas, compositions, designs and confidential business
and technical information and (ii) Intellectual Property that is not registered
or subject to application for registration and that is not material to the
Moving Business as presently conducted.
(b) Title. All of the material Intellectual Property used or held for use
in connection with, or necessary for the conduct of, the Moving Business (the
"Company Intellectual Property"), is owned by a member of the Company Group,
except as set forth in Section 2.13(c) of the Seller Disclosure Letter and
except for shrinkwrap software for which the cost to the Company Group of
acquiring a license thereto was less than $15,000 ("Excluded Software"). Except
as set forth in Section 2.13(b) of the Seller Disclosure Letter and except as
set forth in Section 2.13(c) of the Seller Disclosure Letter with respect to
Software licensed to a member of the Company Group by a third-party vendor, each
member of the Company Group has the full and exclusive right to use its
respective Company Intellectual Property, free from (i) any Liens (except for
Permitted Liens incurred in the ordinary course of business or Liens created by
the Buyer in connection with the Closing) and (ii) any outstanding requirement
of any material present or future royalty payments, license fees, charges or
other payments, or material conditions or restrictions whatsoever. Immediately
after the Closing, each member of the Company Group shall own or have the right
to use all the Company Intellectual Property, in each case free from Liens
(except for Permitted Liens incurred in the ordinary course of business) and on
the same terms and conditions as in effect prior to the Closing, except as
otherwise disclosed in Section 2.13(b) of the Seller Disclosure Letter.
(c) Licensing and Similar Arrangements. Section 2.13(c) of the Seller
Disclosure Letter sets forth all material written agreements and arrangements,
and, to Seller's Knowledge, all material oral agreements and arrangements, (i)
pursuant to which
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any member of the Company Group has licensed Intellectual Property to, or the
use of Intellectual Property is otherwise permitted by any member of the Company
Group (through non-assertion, settlement or similar agreements or implied
licenses) with respect to, any other Person (including any member of the Selling
Group), and (ii) pursuant to which any member of the Company Group has had
Intellectual Property licensed to it, or has otherwise been permitted to use
Intellectual Property (through non-assertion, settlement or similar agreements
or implied licenses), other than licenses for Excluded Software. Except as set
forth in Section 2.13(c) of the Seller Disclosure Letter, all of the agreements
or arrangements set forth or required to be set forth in Section 2.13(c) of the
Seller Disclosure Letter: (A) are in full force and effect and enforceable in
accordance with their terms, and no default exists or is threatened thereunder
by any member of the Company Group, or, to the Seller's Knowledge, by any other
Person, except for such defaults that, individually and in the aggregate, have
not had or resulted in a Material Adverse Effect, (B) are free and clear of all
Liens (except for Permitted Liens incurred in the ordinary course of business),
and (C) do not contain any change in control or other material terms or
conditions that will become applicable or inapplicable as a result of the
consummation of the transactions contemplated by this Agreement and the
Transaction Agreements. The Seller has delivered or made available to the Buyer
complete and correct copies of all agreements and arrangements (including
amendments, supplements, waivers and other modifications) set forth or required
to be set forth in Section 2.13(c) of the Seller Disclosure Letter.
(d) No Infringement. The present conduct of the Moving Business does not
infringe or otherwise conflict with any Intellectual Property rights of any
Person, other than such infringement or conflict which, individually or in the
aggregate, has not had or resulted in a Material Adverse Effect. To the Seller's
Knowledge, none of the Company
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Intellectual Property is being infringed or otherwise used by any Person without
a license or permission from the Company, except as set forth in Section 2.13(d)
of the Seller Disclosure Letter, other than such infringement or use that,
individually or in the aggregate, has not had or resulted in a Material Adverse
Effect.
(e) No Intellectual Property Litigation. No written claim or demand of any
Person has been made to any member of the Selling Group or the Company Group or,
to the Seller's Knowledge, has been threatened, nor is there any Litigation that
is pending or, to the Seller's Knowledge, threatened, that (i) challenges the
rights of any member of the Company Group in respect of any Company Intellectual
Property, (ii) asserts that any member of the Company Group is infringing or
otherwise in conflict with, or is (except as set forth in Section 2.13(b) of the
Seller Disclosure Letter), required to pay any material royalty, license fee,
charge or other amount with regard to, any Intellectual Property, or (iii)
claims that any default exists under any agreement or arrangement set forth or
required to be set forth in Section 2.13(c) of the Seller Disclosure Letter.
Except as set forth in Section 2.13(e) of the Seller Disclosure Letter, to the
Seller's Knowledge, none of the Company Intellectual Property is subject to any
outstanding order, ruling, decree, judgment or stipulation by or with any court,
tribunal, arbitrator or other Governmental Authority, or has been the subject of
any Litigation within the last five years, whether or not resolved in favor of
any member of the Selling Group or the Company Group.
(f) Due Registration, Etc. Except as set forth in Section 2.13(f) of the
Seller Disclosure Letter, each member of the Selling Group and the Company Group
has taken all commercially reasonable actions to ensure full protection of the
Company Intellectual Property (including taking commercially reasonable steps to
maintain the secrecy of all confidential Intellectual Property) under any
applicable Law, except where the failure to take such action, individually or in
the aggregate, has not had or resulted in a Material
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Adverse Effect. Without limiting the foregoing, the Owned Intellectual Property
has been duly registered with, filed in or issued by, as the case may be, the
United States Patent and Trademark Office, the United States Copyright Office or
other filing offices, domestic or foreign, to the extent determined by the
Company Group to be practicable and desirable to protect the Company Group's
rights therein under any applicable Law, and such registrations, filings and
issuances are in full force and effect, in each case, to the extent material to
the Moving Business.
(g) Year 2000. (i) The Company Group has developed and commenced a plan
which sets forth steps intended to ensure that all Computer Systems used or held
for use by the Company Group are, or will be before and shall remain during and
after January 1, 2000, Year 2000 Compatible (the "Y2K Plan"). Pursuant to the
Y2K Plan, each member of the Company Group has conducted an inventory and/or
other investigations of any and all Computer Systems used by such member or held
for use by such member of the Company Group in order to determine which parts of
such Computer Systems are not Year 2000 Compatible and to estimate the cost of
rendering such Computer Systems Year 2000 Compatible prior to January 1, 2000.
(ii) The Y2K Plan includes reasonable steps to investigate the Year 2000
Compatibility of the Computer Systems of all suppliers and customers with which
any member of the Company Group has a relationship material to the Moving
Business as currently conducted by such member of the Company Group. Each member
of the Company Group has a reasonable basis to believe, and does believe, that
the Computer Systems of all such suppliers and customers are, or will be before
and shall remain during and after January 1, 2000, Year 2000 Compatible to the
extent necessary or desirable for such member of the Company Group to be able to
continue to conduct the Moving Business as currently conducted without material
disruption prior to, during and after
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January 1, 2000. The Y2K Plan includes reasonable contingency plans to minimize
the effect of any failure of any member of the Company Group, or any such
supplier or customer, to cause its Computer Systems to be Year 2000 Compatible
before January 1, 2000, which plans include, without limitation, alternative
sources for products and services. The Company Group has provided or made
available to the Buyer a copy of the Y2K Plan and a current status report
thereon.
2.14. Insurance. The Seller has delivered to the Buyer a complete and
correct list of all insurance policies maintained at present by or on behalf of
any member of the Company Group. The Seller has delivered or made available to
the Buyer complete and correct copies of all such policies together with all
riders and amendments thereto. Such policies are in full force and effect, and
all premiums due thereon have been paid.
2.15. Litigation. Section 2.15 of the Seller Disclosure Letter sets forth
a list and summary description of all Litigation involving any member of the
Company Group or the conduct or operations of the Moving Business as of
September 2, 1999 in which the amount payable (in each case if adversely
determined, and without regard to whether the defense or liability in respect
thereof is covered by policies of insurance or any indemnity, contribution, cost
sharing or similar arrangement by or with any other Person) by any member of the
Company Group would reasonably be expected to exceed $100,000. Except as set
forth in Section 2.15 of the Seller Disclosure Letter, there is no Litigation
pending or, to the Seller's Knowledge, threatened by, or against any member of
the Company Group or any of its properties or assets, that, individually or in
the aggregate, has had or resulted in a Material Adverse Effect (in each case,
if adversely determined). There are no outstanding orders, judgments, decrees or
injunctions issued by any Governmental Authority against any member of the
Selling Group or the Company Group that in any way affect the Moving Business
and operations of any member of the Company
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Group that, individually or in the aggregate, have had or resulted in a Material
Adverse Effect.
2.16. Compliance with Laws and Instruments; Permits; Consents.
(a) Compliance. Except as set forth in Section 2.16(a) of the Seller Disclosure
Letter, (i) each member of the Company Group is not, and has not been, in
conflict with or in violation or breach of or default under (and there exists no
event that, with notice or passage of time or both, would constitute a conflict,
violation, breach or default with, of or under) (x) any Law (other than
Environmental Laws which are covered in Section 2.17) applicable to it or any of
its properties, assets, operations or business (other than Real Property which
is covered in Section 2.11), (y) any provision of its Organizational Documents,
or (z) any Material Contract, except in the case of the foregoing clauses (x)
and (z) for any such conflicts, breaches, violations and defaults that,
individually or in the aggregate, have not had or resulted in a Material Adverse
Effect, and (ii) no member of the Selling Group or the Company Group has
received any written notice and, to the Knowledge of the Seller, there are no
claims, alleging any such conflict, violation, breach or default.
(b) Permits. Section 2.16(b) of the Seller Disclosure Letter contains a
complete and correct list as of the date hereof of all material Permits held by
any member of the Company Group. All such Permits have been duly obtained and
are held by a member of the Company Group and are in full force and effect,
except in each case, where the failure to obtain such Permit, individually and
in the aggregate, has not had or resulted in a Material Adverse Effect. Each
member of the Company Group is in compliance with all Permits held, except for
failures so to comply that, individually and in the aggregate, have not had or
resulted in a Material Adverse Effect. There is no pending or, to the Seller's
Knowledge, threatened investigation or proceeding, seeking the suspension,
revocation or cancellation of any such Permit; no member of the Selling Group or
the
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Company Group has been notified in writing that any such Permit will be
materially adversely modified, suspended, canceled or cannot be renewed.
(c) Consents; Approvals; etc. Except as specified in Section 2.16(c)(i) of
the Seller Disclosure Letter, no Consent is required to be obtained or made by
any member of the Selling Group or the Company Group in connection with the
execution and delivery of this Agreement and the Transaction Agreements or the
consummation of the transactions contemplated hereby or thereby, except where
the failure to obtain such Consent, individually and in the aggregate, would not
have or result in a Material Adverse Effect (and other than Consents in
connection with Real Property (which are covered in Section 2.11(f)). For the
purposes of this Agreement, "Material Consents" shall be those Consents listed
in Section 2.16(c)(ii) of the Seller Disclosure Letter.
(d) Governmental Filings. Each registration, report, statement, notice or
other filing requested or required to be filed by any member of the Selling
Group with respect to the Moving Business or the Company Group with any
Governmental Authority under any applicable Law has been timely filed, and when
filed complied with applicable Law, except in each case, where the failure to
file such registration, report, statement or notice or other filing,
individually and in the aggregate, has not had or resulted in a Material Adverse
Effect.
(e) Insurance Subsidiaries. (i) Each of the Insurance Companies holds all
required Insurance Licenses in each jurisdiction and for each line of business
conducted by such Insurance Company. All such Insurance Licenses, including, but
not limited to, authorizations to transact reinsurance, are listed on Section
2.16(e) of the Seller Disclosure Letter, and are in full force and effect and
not subject to any material limitation or restriction, except as disclosed in
the terms of the license or otherwise by operation of Law or where the failure
to be in full force and effect may be cured within thirty days
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without material cost or expense. No proceeding or complaint has been filed by
or with insurance regulatory authorities which is reasonably likely to result in
the revocation, suspension, failure to renew, material limitation or
restriction, of any such Insurance License. "Insurance License" is defined as a
license or permit granted by applicable insurance regulatory authorities to
conduct an insurance business.
(ii) The business and operations of each of the Insurance Companies have
been conducted in compliance with all applicable statutes, regulations and rules
regulating the business of insurance and all applicable orders and directives of
insurance regulatory authorities and market conduct recommendations resulting
from market conduct examinations of insurance regulatory authorities
(collectively, "Insurance Laws"), except where the failure to so conduct such
business and operations, individually or in the aggregate, has not had or
resulted in a Material Adverse Effect. In addition, (A) there is no pending or,
to the knowledge of the Seller, threatened charge by any insurance regulatory
authority that any of the Insurance Companies has violated, nor any pending or,
to the Knowledge of the Seller, threatened investigation by any insurance
regulatory authority with respect to possible violations of, any applicable
Insurance Laws; (B) none of the Insurance Companies is subject to any order or
decree of any insurance regulatory authority not generally applicable to
insurance companies subject to the jurisdiction of such authority; and (C) each
of the Insurance Companies has filed all reports required to be filed with any
insurance regulatory authority except where the failure to file such reports,
individually and in the aggregate, has not had or resulted in a Material Adverse
Effect.
(iii) Except as, individually or in the aggregate, has not had and or
resulted in a Material Adverse Effect, all policies, binders, slips,
certificates, and other agreements of insurance, in effect as of the date hereof
(including all applications, supplements, endorsements, riders and ancillary
agreements in connection therewith) that are issued by
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any of the Insurance Companies (the "Insurance Contracts") are, to the extent
required under applicable Insurance Law, on forms approved by applicable
insurance regulatory authorities or which have been filed and not objected to by
such authorities within the period provided for objection, and such forms comply
in all material respects with all Insurance Laws applicable thereto and, as to
premium rates established by any of the Insurance Companies which are required
to be filed with or approved by insurance regulatory authorities, the rates have
been so filed or approved, the premiums charged conform thereto in all material
respects, and such premiums comply in all material respects with all Insurance
Laws applicable thereto.
(iv) All reinsurance and coinsurance treaties or agreements, including
retrocessional agreements, to which any Insurance Company is a party or under
which any Insurance Company has any existing rights, obligations or liabilities
are in full force and effect. No Insurance Company, nor, to the Seller's
Knowledge, any other party to a reinsurance or coinsurance treaty or agreement
to which any Insurance Company is a party, is in default in any material respect
as to any provision thereof, and no such agreement contains any provision
providing that the other party thereto may terminate such agreement by reason of
the transactions contemplated by this Agreement. No Insurance Company has
received any notice to the effect that the financial condition of any other
party to any such agreement is impaired with the result that a default
thereunder may reasonably be anticipated. Except as set forth in Section
2.16(a)(iv) of the Seller Disclosure Letter, no insurer or reinsurer or group of
affiliated insurers or reinsurers accounted for the ceding by or to the
Insurance Companies of insurance or reinsurance business in an aggregate amount
equal to two percent or more of the consolidated gross premium income of the
Insurance Companies for the year ended December 31, 1998.
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(v) The Seller has delivered or made available to Buyer a true and
complete copy of any actuarial reports prepared by actuaries, independent or
otherwise, with respect to the Insurance Companies since December 31, 1995, and
all attachments, addenda, supplements and modifications thereto (the "Company
Actuarial Analyses"). The information and data furnished by the Seller or any of
the Insurance Companies to its independent actuaries in connection with the
preparation of the Company Actuarial Analyses were accurate and complete in
accordance with industry standards and practices. Each Company Actuarial
Analysis was based upon a substantially accurate inventory of policies in force
for each of the Insurance Companies, as the case may be, at the relevant time of
preparation, was prepared using appropriate modeling procedures accurately
applied and in conformity with generally accepted actuarial standards
consistently applied, and the projections contained therein were properly
prepared in accordance with the assumptions stated therein.
(vi) All benefits claimed by any Person under Insurance Contracts issued
by any of the Insurance Companies have been paid (or provision for payment
thereof has been made) in accordance with the terms of the applicable Insurance
Contract; such payments were not materially delinquent when made; and such
payments were paid (or will be paid) without fines or penalties, except in each
case for any claim for benefits for which the relevant Insurance Company
believes or believed in good faith that there is or was a reasonable basis for
contesting the benefit, and is contesting or has contested the payment.
(vii) The reserves carried on the SAP Statements of each of the Insurance
Companies for future insurance policy benefits, losses, claims and similar
purposes were, as of the respective dates of such SAP Statements, in compliance
in all material respects with the requirements for reserves established by the
insurance departments of the state of
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domicile of such Insurance Company, were determined in all material respects in
accordance with generally accepted actuarial standards and principles
consistently applied, and were fairly stated in all material respects in
accordance with sound actuarial and statutory accounting principles. The
admitted assets of each of the Insurance Companies as determined under
applicable Insurance Laws are in an amount at least equal to the minimum amounts
required by applicable Insurance Laws. In addition, the Seller has delivered or
made available to Buyer copies of all work papers used as the basis for
establishing the reserves for the Insurance Companies at December 31, 1997 and
December 31, 1998, respectively.
(viii) Except for regular periodic assessments in the ordinary course of
business or assessments based on developments which are publicly known within
the insurance industry, no claim or assessment is pending or to the Seller's
Knowledge, threatened against any of the Insurance Companies by any state
insurance guaranty association in connection with such association's fund
relating to insolvent insurers which if determined adversely, would,
individually or in the aggregate, have or result in a Material Adverse Effect.
2.17. Environmental Matters. (a) Compliance with Environmental Law. Except
as set forth in Section 2.17(a) of the Seller Disclosure Letter, each member of
the Company Group has complied and is in compliance with all applicable
Environmental Laws, pertaining to its respective assets, including but not
limited to the Real Property and the use, ownership or transferability thereof,
and to the operation of the Moving Business, except where the failure to comply,
individually and in the aggregate, has not had or resulted in a Material Adverse
Effect. Except as set forth in Section 2.17(a) of the Seller Disclosure Letter,
each member of the Company Group is in possession of, and in compliance with all
Environmental Permits, except for failures to comply that, individually
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and in the aggregate, have not had or resulted in a Material Adverse Effect.
Except as set forth in Section 2.17(a) of the Seller Disclosure Letter, there is
no pending or, to the Seller's Knowledge, threatened investigation or
proceeding, seeking the suspension, revocation or cancellation of any such
Environmental Permit; no member of the Selling Group or the Company Group has
been notified in writing that any such Environmental Permit will be materially
adversely modified, suspended, canceled or cannot be renewed. No violation by
any member of the Selling Group or the Company Group is being alleged of any
applicable Environmental Law or Environmental Permit relating to the operation
of the Moving Business or the use, ownership or transferability of the Company
Group's assets, including but not limited to the Real Property, except for
violations that, individually and in the aggregate, have not had or resulted in
a Material Adverse Effect.
(b) Other Environmental Matters. Except as disclosed in Section 2.17(b) of
the Seller Disclosure Letter or as, individually and in the aggregate, has not
had or resulted in a Material Adverse Effect:
(i) No member of the Company Group has caused or has taken any
action that would result in, and no member of the Company Group is subject
to, any liability or obligation relating to (x) the environmental
conditions on, under, or about the Real Property or other properties or
assets owned, leased or used by any member of the Company Group at the
present time or in the past, including without limitation, the soil and
groundwater conditions at such properties; or (y) the past or present use,
management, handling, transport, treatment, generation, storage or Release
of any Hazardous Materials.
(ii) None of the Company Group's current or past operations, or any
by-product thereof, and none of the currently or formerly owned or leased
property or assets of the Company Group, including without limitation the
Real Property, is
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related to or subject to any investigation or evaluation by any
Governmental Authority, as to whether any Remedial Action is needed to
respond to a Release or threatened Release of any Hazardous Materials.
(iii) No member of the Company Group is subject to any outstanding
order from, or contractual or other obligation with, any Governmental
Authority or other person in respect of which the Company Group may be
required to perform any Remedial Action arising from the Release or
threatened Release of a Hazardous Material and no member of the Company
Group has entered into any contractual or other obligation with any
Governmental Authority or other person pursuant to which any member of the
Company Group assumed responsibility for, either directly or indirectly,
the remediation of any condition arising from or relating to the Release
or threatened Release of Hazardous Materials.
(iv) Other than the Real Property located in the United Kingdom,
none of the Real Property and no properties previously owned or leased by
any member of the Company Group or any of its predecessors or affiliates
(other than properties previously owned or leased in the United Kingdom)
is, and no member of the Company Group has transported or arranged for
transportation (directly or indirectly) of any Hazardous Materials to any
location (other than locations in the United Kingdom) that is, listed or
proposed for listing under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, 42 U.S.C. ss.ss. 9601,
et seq., or on any similar state list, or the subject of federal, state or
local enforcement actions, investigations or Remedial Action, in each
case, whether domestic or foreign. None of the Real Property located in
the United Kingdom and, to the Knowledge of the Seller, no properties
located in the United Kingdom that were previously owned or leased by any
member of the Company Group or any
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predecessors or affiliates is, and no member of the Company Group has
transported or arranged for transportation (directly or indirectly) of any
Hazardous Materials to any location in the United Kingdom that is the
subject of an environmental enforcement action or investigation or is
listed or proposed for listing as a site requiring Remedial Action.
(c) Disclosure. The Seller has made available to the Buyer all
environmental site assessments, environmental compliance audits and studies of
potentially material on-site and off-site contamination, dated after January 1,
1994, relating to the Real Property, or otherwise in connection with the use or
operation of the Company Group's assets or the Moving Business.
2.18. Affiliate Transactions. Section 2.18 of the Seller Disclosure Letter
contains a complete and correct list of all written and to the Knowledge of the
Seller, all oral, material agreements, contracts, arrangements or transfers of
assets or liabilities, whether or not entered into in the ordinary course of
business, to or by which any member of the Company Group, on the one hand, and
the Seller or any of its Affiliates (other than any member of the Company
Group), on the other hand, are parties to that involve continuing liabilities
and obligations that, individually or in the aggregate, are material to any
member of the Company Group. Except as disclosed in Section 2.18 of the Seller
Disclosure Letter, each agreement, contract, arrangement, transfer of assets or
liabilities set forth or required to be set forth in Section 2.18 of the Seller
Disclosure Letter was in all material respects on terms and conditions as
favorable to the relevant member of the Company Group as would have been
obtainable by it at the time in a comparable arm's-length transaction with a
Person other than the Seller or any of its Affiliates.
2.19. Employees, Labor Matters, etc. Except as set forth in Section 2.19
of the Seller Disclosure Letter, no member of the Company Group is a party to or
bound by any
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collective bargaining agreement, and, to the Seller's Knowledge, there are no
labor unions or other organizations representing employees employed by any
member of the Company Group. Except as set forth in Section 2.19 of the Seller
Disclosure Letter, since September 30, 1996, there has not occurred any material
strike, slowdown, picketing, work stoppage, concerted refusal to work overtime
or other similar labor activity with respect to any employees of any member of
the Company Group. Except as set forth in Section 2.19 of the Seller Disclosure
Letter, there are no labor disputes currently subject to any arbitration or
litigation and there is no representation petition pending with respect to any
employee of any member of the Company Group. Except as set forth in Section 2.19
of the Seller Disclosure Letter, the Company Group has complied with all
applicable Laws pertaining to the employment or termination of employment of
their respective employees, including, without limitation, all such Laws
relating to labor relations, equal employment opportunities, fair employment
practices, prohibited discrimination or distinction and other similar employment
activities, except for any failure so to comply that, individually and in the
aggregate, has not had or resulted in a Material Adverse Effect.
2.20. U.S. Employee Benefit Plans; ERISA. (a) Section 2.20 of the Seller
Disclosure Letter contains a true and complete list of each U.S. Plan.
(b) With respect to each U.S. Plan, the Seller has heretofore delivered or
made available to the Buyer true and complete copies of each of the following
documents (including all amendments to such documents):
(i) the U.S. Plan or a written description of any U.S. Plan not in
writing, which, in either case, provides disclosure of all material
benefits, entitlements and discretionary practices under such U.S. Plan;
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(ii) the two most recent annual reports and actuarial reports if
required under ERISA;
(iii) the most recent summary plan description with respect thereto
if required under ERISA;
(iv) if the U.S. Plan or any obligations thereunder are funded
through a trust, insurance contract or any other funding vehicle, the
trust, insurance contract or other funding agreement and the two most
recent financial statements thereof;
(v) the most recent determination letter received from the Internal
Revenue Service with respect to each U.S. Plan intended to qualify under
section 401(a) of the Code; and
(vi) communications that the Seller or any of its Subsidiaries has
received from or sent to the PBGC, the Department of Labor, the Internal
Revenue Service concerning any termination of, withdrawal from or
appointment of a trustee to administer any U.S. Plan or the failure or
alleged failure to comply with any provision of ERISA or the Code with
respect to any U.S. Plan, including any existing written description of
any such oral communication.
(c) No liability under Title I or IV of ERISA or the penalty or excise tax
provisions of the Code has been incurred by any member of the Company Group that
has not been satisfied in full, and no condition exists or event has occurred
that presents a material risk to any member of the Company Group of incurring
any such liability, other than (i) liability for contributions due in the
ordinary course and premiums due the Pension Benefit Guaranty Corporation
("PBGC") (which contributions and premiums have been paid when due) and
(ii) such liabilities that, individually and in the aggregate, have not had
or resulted in a Material Adverse Effect.
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(d) No U.S. Plan is a "multiemployer plan" within the meaning of section
4001(a)(3) of ERISA or a "multiple employer plan" within the meaning of section
4063 or 4064 of ERISA.
(e) Each U.S. Plan satisfies any applicable minimum funding requirements
under the Code and ERISA, except for any failure to satisfy such funding
requirements that, individually or in the aggregate, has not had or resulted in
a Material Adverse Effect. Each U.S. Plan intended to be "qualified" within the
meaning of section 401(a) of the Code has received a favorable letter of
determination from the Internal Revenue Service that it so qualifies and that
its related trust is exempt from taxation under section 501(a) of the Code and,
to the Knowledge of the Seller, no condition exists or event has occurred that
would adversely affect the qualified status of any such U.S. Plan. Each U.S.
Plan has been operated and administered in all respects in accordance with its
terms and applicable Law, except any such failures to so operate or administer
that, individually or in the aggregate, have not had or resulted in a Material
Adverse Effect. There are no pending or, to the Knowledge of the Seller,
threatened claims by or on behalf of any Plan, by any employee or beneficiary
covered under any such Plan or otherwise involving any such Plan or the assets
thereof (other than routine claims for benefits).
(f) No member of the Company Group would be liable for any amount pursuant
to section 4062, 4063 or 4064 of ERISA that, individually or in the aggregate,
would have or result in a Material Adverse Effect, if any U.S. Plan were to
terminate. All contributions required to be made to each U.S. Plan under the
terms of such U.S. Plan, applicable Law or any applicable collective bargaining
agreement have been paid in full when due, except where such failure to make a
contribution, individually or in the aggregate, has not had or resulted in a
Material Adverse Effect.
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2.21. Non-U.S. Plans. (a) Section 2.21 of the Seller Disclosure Letter
contains a true and complete list of each Non-U.S. Plan.
(b) With respect to each Non-U.S. Plan, the Seller has heretofore
delivered or made available to the Buyer a written description of such Non-U.S.
Plan providing disclosure of all material benefits, entitlements and
discretionary practices under such Non-U.S. Plan.
(c) Each Non-U.S. Plan has been operated and administered in all respects
in accordance with its terms and applicable Law, except any such failures to so
operate or administer that, individually or in the aggregate, have not had or
resulted in a Material Adverse Effect. There are no pending or, to the Knowledge
of the Seller, threatened claims by or on behalf of any Non-U.S. Plan, by any
employee or beneficiary covered under any such Non-U.S. Plan or otherwise
involving any such Non-U.S. Plan or the assets thereof (other than routine
claims for benefits). All contributions required to be made to each Non-U.S.
Plan under the terms of such Non-U.S. Plan, applicable Law or any applicable
collective bargaining agreement have been paid in full when due except where
such failure to make a contribution, individually or in the aggregate, has not
had or resulted in a Material Adverse Effect. To the Knowledge of the Seller,
there has not been any failure to comply with any applicable Law or any other
circumstances, which would be reasonably likely to result in the loss of tax
approval or qualification of any Non-U.S. Plan.
2.22. UK Pension Scheme. Except as disclosed in Section 2.22 of the Seller
Disclosure Letter:
(a) Other than in respect of the Seller's Schemes, to the knowledge of the
Seller, the Target U.K. Subsidiary (i) has no obligation (whether legally
binding or not) to provide "relevant benefits" (within the meaning of Section
612 ICTA 1988) to, or in respect of any person who is now or has been an officer
or employee of the Target U.K.
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Subsidiary or spouse or dependant of such officer or employee and (ii) is not a
party to or obliged to contribute to any scheme or arrangement (including, but
not limited to, a personal pension scheme as defined in Section 630 ICTA 1988)
having as its purpose or one of its purposes the making of any such payments, or
the provision of any such benefits, as are mentioned in Section 2.22(a)(i)
above.
(b) No undertaking or assurance has been given to any person who is now,
or has been, an officer or employee of the Target U.K. Subsidiary, or spouse or
dependant of such officer or employee, as to the continuance or introduction or
improvement of any benefits referred to in Section 2.22(a) which the Target U.K.
Subsidiary or the Buyer would be required to implement in accordance with good
industrial relations practice, whether or not there is any legal obligation to
do so.
(c) Full details of the Seller's Schemes have been disclosed to the Buyer
including accurate, up-to-date and complete copies of all documents constituting
or relating to the Seller's Schemes. These documents disclose full particulars
of the benefits and entitlements under the Seller's Schemes and any
discretionary practices relating to the Seller's Schemes and the contributions
payable to the Seller's Schemes, in each case, by and in respect of the officers
and employees of the Target U.K. Subsidiary and there is no obligation to
provide benefits under the Seller's Schemes other than as revealed in such
documents and particulars. All information concerning the Seller's Schemes or
any other payments or benefits referred to in Sections 2.22(a) and (b) above
which has been made available to the Buyer or its advisers on or before the date
of this Agreement is true, complete in all material respects.
(d) The Seller's Schemes are "exempt approved schemes" (within the meaning
of Chapter I of Part XIV ICTA 1988) and, to the Seller's Knowledge, there is no
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reason why approval of the Seller's Schemes by the Board of Inland Revenue
should be withdrawn.
(e) The Seller holds or is named in an appropriate contracting-out
certificate as defined in Section 7 of the 1993 Act and, to the Seller's
Knowledge, there is no reason why such certificate might be canceled, varied or
surrendered.
(f) The provisions of the Seller's Schemes have never unlawfully
discriminated between male and female members.
(g) All premiums payable under contracts of insurance relating to payment
of benefits on death before normal pension age in respect of any officer or
employee of the Target U.K. Subsidiary have been paid.
(h) Contributions to the Seller's Schemes are paid in arrears and all
contributions to, and expenses of, the Seller's Schemes which have fallen due
for payment by Target U.K. Subsidiary have been paid.
(i) The Seller's Schemes have not been closed to new entrants. No event
has taken place which has resulted or will or may result in the commencement of
the winding up of the Seller's Schemes (or any part of it).
(j) As regards the officers and employees of the Target U.K. Subsidiary,
there is no arrangement other than the Seller's Early Retirement/Redundancy
Scheme (as defined in the Pensions Agreement), whether legally binding or not,
to provide enhanced or new benefits in a given set of circumstances (by way of
example, but without limitation, on employees retiring from service at the
request of their employer or in the event of them, or those of them who are over
a specified age, being made redundant) and the Seller is not considering
implementing any such arrangement.
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(k) No repayment of assets or monies of the Seller's Schemes has been or
is proposed to be made by the trustees of the Seller's Schemes to any employer
participating in the Seller's Schemes.
(l) The Seller's Schemes have been operated and administered in all
respects in accordance with their terms and applicable Law, except any such
failures to so operate or administer that, individually or in the aggregate,
have not had or resulted in a Material Adverse Effect. There are no pending or,
to the Seller's Knowledge, threatened claims by or on behalf of any of the
Seller's Schemes, by any employee or beneficiary covered under any of the
Seller's Schemes or otherwise involving the Seller's Schemes or the assets
thereof (other than routine claims for benefits). The Target U.K. Subsidiary has
at all times complied with all provisions of the Seller's Schemes which apply to
it.
(m) In determining the damages flowing from any breach of this Section
2.22 it shall be assumed that (i) the Target U.K. Subsidiary and/or the Buyer is
under a liability to make whatever payments (other than members' contributions)
are required to provide all benefits that are provided for (or with respect to
which there has been a proposal to provide) as of the Closing Date under any
arrangement which is or ought to be disclosed pursuant to this Section 2.22 and
any power to amend or discontinue any such arrangement shall be disregarded (in
the case of an arrangement that ought to have been disclosed, only if such
arrangement legally obligates payment or if such payment is consistent with past
practice over the three years preceding the Closing Date) and (ii) the Target
U.K. Subsidiary and/or Buyer is under a liability to provide and to continue to
provide any benefits (including gratuities) of a kind referred to in this
Section 2.22 which the Seller now provides or is proposing to provide and to
maintain without amendment any schemes or arrangements of a kind referred to in
that paragraph which are now in existence.
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2.23. [Intentionally Omitted].
2.24. Customers; Agents; Authorized Representatives. (a) Section 2.24(a)
of the Seller Disclosure Letter sets forth for the year ended September 30, 1998
and for the six-month period ended March 31, 1999: (i) the names and addresses
of the customers of each member of the Company Group based in the U.K. and
Europe that spent more than (pound) 100,000 during each such period, (ii) the
names and addresses of the top 25 customers of each of (a) Allied Domestic, (b)
Allied Special Products, (c) Allied International and (d) Allied Canada based on
the aggregate value of goods and services ordered from the Company Group by such
customers during each such period and (iii) the amount for which each such
customer was invoiced during each such period. No member of the Selling Group or
the Company Group has received any notice or, to the Knowledge of the Seller, no
member of the Selling Group has a reasonable basis to believe that any material
customer of the Company Group (i) has ceased, or will cease, to use the
products, goods or services of the Company Group, (ii) has materially reduced or
will materially reduce, the use of products, goods or services of the Company
Group or (iii) has sought, or is seeking, to materially reduce the price it will
pay for products, goods or services of the Company Group, provided, that (i),
(ii) and (iii) above shall not apply to any customer of the Company Group that
used the products, goods, or services of the Company Group on a one time basis
during the past twelve months.
(b) Section 2.24(b) of the Seller Disclosure Letter sets forth, for the
year ended September 30, 1998 and for the six-month period ended March 31, 1999,
a list of the names of the 50 largest Agents based on the aggregate line haul
revenue of the Company Group attributable to such Agents during each such
period, indicating with respect to each such Agent the aggregate value of goods
and/or services ordered from the Company Group by customers for whose accounts
such Agent was responsible. Except as
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set forth in Section 2.24(b) of the Seller Disclosure Letter, no member of the
Selling Group or the Company Group has received any written notice or, to the
Knowledge of the Seller, has any reason to believe that any such Agent will
cease doing business with the Company Group on terms substantially comparable to
those in effect between such Agent and the Company Group as of the date hereof,
whether pursuant to a written contract or otherwise.
(c) Section 2.24(c) of the Seller Disclosure Letter sets forth, for the
year ended September 30, 1998 and for the six-month period ended March 31, 1999,
a list of the names of the 50 largest Authorized Representatives based on the
aggregate line haul revenue of the Company Group attributable to such Authorized
Representatives during each such period, indicating with respect to each such
Authorized Representative the aggregate value of goods and/or services ordered
from the Company Group by customers for whose accounts such Authorized
Representative was responsible. Except as set forth in Section 2.24(c) of the
Seller Disclosure Letter, no member of the Selling Group or the Company Group
has received any written notice or, to the Knowledge of the Seller, no member of
the Selling Group has any reason to believe that any such Authorized
Representative will cease doing business with the Company Group on terms
substantially comparable to those in effect between such Authorized
Representative and the Company Group as of the date hereof, whether pursuant to
a written contract or otherwise.
2.25. Bank Accounts. Section 2.25 of the Seller Disclosure Letter sets
forth a complete and correct list containing the names of each bank in which any
member of the Company Group has an account or safe deposit or lock box, the
account or box number, as the case may be, and the name of every person
authorized to draw thereon or having access thereto.
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2.26. Brokers, Finders, etc. Except for Morgan Stanley Dean Witter and
Credit Suisse First Boston, (together, the "Seller's Financial Advisors"), all
negotiations relating to this Agreement and the Transaction Agreements, and the
transactions contemplated hereby and thereby have been carried on without the
participation of any Person acting on behalf of any member of the Selling Group
in such a manner as to, and the transactions contemplated hereby and thereby
will not otherwise, give rise to any valid claim against any member of the
Company Group or the Buyer for any brokerage or finder's commission, fee or
similar compensation. All fees and expenses payable to the Seller's Financial
Advisors in connection with the transactions contemplated by the Agreement shall
be borne by the Seller.
2.27. Disclosure. To the Seller's Knowledge, this Agreement and each of
the Transaction Agreements and each certificate required to be furnished by or
on behalf of any member of the Selling Group to the Buyer pursuant hereto or
thereto or in connection herewith or therewith, taken as a whole, do not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated herein or therein or necessary to make the statements
contained herein or therein in light of the circumstances under which they were
made, not misleading.
2.28. Acquisition for Investment. The Seller is acquiring the Warrant, the
Common Shares and the Preferred Shares solely for investment, with no present
intention to resell the Warrant, the Common Shares or the Preferred Shares. The
Seller hereby acknowledges that the Warrant, the Common Shares and the Preferred
Shares have not been registered pursuant to the Securities Act and may not be
transferred in the absence of such registration or an exemption therefrom under
such Act.
2.29. Seller Actions. The Board of Directors of the Seller or a duly
constituted committee thereof (at a meeting duly called and held at which a
quorum was present) as
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part of its approval of this Agreement has (i) approved this Agreement, the
Transaction Agreements and the transactions contemplated hereby and thereby,
(ii) determined that each of this Agreement, the Transaction Agreements and the
Acquisition is in the best interests of the Seller and the stockholders of the
Seller and (iii) resolved to approve this Agreement and the Transaction
Agreements and, if required by applicable Law or stock exchange regulation, to
recommend that the stockholders of the Seller vote in favor of the resolution
approving the Acquisition and the transactions contemplated by this Agreement to
be considered at an extraordinary general meeting of the Seller convened to
approve the Acquisition and the transactions contemplated by this Agreement. The
Seller has furnished to the Buyer a copy of the minutes of the Board of
Directors (or a duly constituted committee thereof) referred to in this Section
2.29, certified by an appropriate officer of the Seller.
2.30. No Additional Representations. Except for the representations and
warranties of the Seller expressly set forth in Article II of this Agreement,
the Seller expressly disclaims any representations or warranties of any kind or
nature, express or implied, as to the condition, value or quality of the Assets
or the Moving Business, and the Seller specifically disclaims any representation
or warranty of merchantability, usage, suitability or fitness for any particular
purpose with respect to the Assets, or any part thereof, or as to the
workmanship thereof, or the absence of any defects therein, whether latent or
patent, it being understood that except for the representations and warranties
of the Selling Group expressly set forth in Article II of this Agreement such
Assets are being acquired "as is, where is" on the Closing Date.
2.31. Seller Disclosure Letter. Disclosure of any fact or item in any
Section of the Seller Disclosure Letter shall be deemed to be disclosed with
respect to any other Section of this Agreement if (x) an explicit
cross-reference appears in such other Section
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of the Seller Disclosure Letter or (y) based on the disclosure in such first
Section of the Seller Disclosure Letter it is readily apparent that the
disclosure applies to such other Section of the Seller Disclosure Letter.
ARTICLE III
Representations and Warranties of the Buyer
The Buyer represents and warrants to the Seller as follows, as of the date
hereof and as of the Closing Date:
3.1. Corporate Status; Authorization, etc. (a) Each member of the Buying
Group is a corporation duly incorporated, validly existing and in good standing
under the laws of its jurisdiction of incorporation. The Buyer has full
corporate power and corporate authority to execute and deliver this Agreement
and the Transaction Agreements to which the Buyer shall be a party, to perform
its obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. Except as set forth in Section 3.1 of the Buyer
Disclosure Letter, the execution and delivery of this Agreement and the
Transaction Agreements to which the Buyer shall be a party, the performance of
its obligations hereunder and thereunder, and the consummation of the
transactions contemplated hereby and thereby, have been duly authorized by all
requisite corporate action of the Buyer. The Buyer has duly executed and
delivered this Agreement and on the Closing Date will have duly executed and
delivered the Transaction Agreements to which it shall be a party. This
Agreement constitutes, and each such Transaction Agreement to which the Buyer
shall be a party when so executed and delivered by the Buyer will constitute,
the legal, valid and binding obligation of the Buyer, enforceable against the
Buyer in accordance with its respective terms, except to the extent that
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other similar laws of general applicability
relating to or affecting the
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enforcement of creditors' rights and by the effect of general principles of
equity (regardless of whether enforceability is considered in a proceeding in
equity or at law).
(b) Buying Group. Each member of the Buying Group that is to be a party to
a Transaction Agreement has full corporate power and corporate authority to
execute and deliver each Transaction Agreement to which such member shall be a
party, to perform such member's obligations thereunder and to consummate the
transactions contemplated thereby. The execution and delivery of each
Transaction Agreement to which such member shall be a party, the performance of
such member's obligations thereunder, and the consummation of the transactions
contemplated thereby, will have been duly authorized by all requisite corporate
action of such member as of the Closing Date. Each such member on the Closing
Date will have duly executed and delivered each such Transaction Agreement to
which such member shall be a party. Each Transaction Agreement when so executed
and delivered will constitute the legal, valid and binding obligation of each
such member party thereto, enforceable against each such member party thereto in
accordance with its respective terms, except to the extent that enforceability
may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws of general applicability relating to or affecting
the enforcement of creditors' rights and by the effect of general principles of
equity (regardless of whether enforceability is considered in a proceeding in
equity or at law).
3.2. Capitalization, etc. (a) Authorized Capital Stock of the Buyer. The
authorized capital stock of the Buyer consists of 1,000,000 shares of Buyer
Common Stock of which, as of the date hereof, (i) 690,254 shares are issued and
outstanding, (ii) 113,407 shares are reserved for issuance under the NA Holding
Stock Incentive Plan (the "NA Holding Plan"), which number includes 13,407
shares reserved for offers of shares pursuant to the NA Holding Plan and 100,000
shares reserved for issuance upon
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exercise of options granted or to be granted under the NA Holding Plan (the
"Options"), (iii) 35,684 shares are reserved for issuance to local moving and
storage companies under contract with the Buyer or one of its Subsidiaries and
certain other qualified investors, (iv) 87,480 shares are reserved for issuance
upon exercise of the Warrant, and (v) 7,600 shares are held as treasury shares.
As of August 31, 1999, 9,589 Options had vested under the NA Holding Incentive
Plan and 63,597 Options had not vested in accordance with their terms and were
not subject to any agreement relating to the cancellation of such Options. Upon
filing of the Certificate of Designation with the Secretary of State of the
State of Delaware in connection with the Closing, the Buyer's authorized capital
will include 24,500 shares of Preferred Stock. As of the date hereof, there are
no shares of Preferred Stock issued and outstanding. All issued and outstanding
shares of Buyer Common Stock have been duly authorized and are validly issued,
fully paid and nonassessable. At the Closing and when issued and delivered in
accordance with this Agreement, the Preferred Shares and the Common Shares will
be duly authorized, validly issued, fully paid and nonassessable. The Buyer
owns, directly or indirectly, all of the issued and outstanding capital stock of
each other member of the Buying Group.
(b) No Equity Rights. Except as set forth in the Registration and
Participation Agreement, there are no preemptive or similar rights on the part
of any holders of any class of securities of the Buyer. Except for the Options,
the Warrant, this Agreement, the Registration and Participation Agreement, and
the Stock Subscription Agreements, no subscriptions, options, warrants,
conversion or other rights, agreements, commitments, arrangements or
understandings of any kind obligating the Buyer, contingently or otherwise, to
issue or sell, or cause to be issued or sold, any shares of capital stock of any
class of the Buyer, or any securities convertible into or exchangeable for any
such shares, are outstanding, and no authorization therefor has been given.
Except for arrangements
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entered into in connection with the termination of certain employment of certain
management employees from time to time, there are no outstanding contractual or
other rights or obligations to or of the Buyer or any other Person to
repurchase, redeem or otherwise acquire any outstanding shares or other equity
interests of the Buyer.
3.3. Buyer Financial Statements. (a) The Buyer has delivered to the Seller
complete and correct copies of the Buyer Financial Statements. The Buyer
Financial Statements are complete and correct in all material respects, were
prepared from, and are in accordance with the books and records of the Buyer and
its Subsidiaries, and have been prepared in accordance with United States
generally accepted accounting principles ("U.S. GAAP") applied on a consistent
basis throughout the periods presented in the Buyer Financial Statements,
subject, in the case of the interim unaudited Buyer Financial Statements, only
to normal recurring year-end adjustments and the absence of footnotes. The
balance sheets included in the Buyer Financial Statements present fairly in all
material respects the financial position of the Buyer and its Subsidiaries as at
the respective dates thereof, and the statements of income, statements of
stockholder's equity and statements of cash flows included in such Buyer
Financial Statements present fairly in all material respects the results of
operations and cash flows of the Buyer and its Subsidiaries for the respective
periods indicated.
(b) E&Y Engagement Letter. The Buyer has duly executed and delivered the
engagement letter with Ernst & Young, a copy of which is attached hereto in
Annex F.
3.4. No Conflicts, etc. Except as set forth in Section 3.4 of the Buyer
Disclosure Letter, the execution, delivery and performance of this Agreement and
the Transaction Agreements by each member of the Buying Group party thereto, and
the consummation of the transactions contemplated hereby and thereby, do not
conflict with, contravene, result in a violation or breach of or default under
(with or without the giving
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of notice or the lapse of time, or both), create in any other Person a right or
claim of termination, amendment, modification, acceleration or cancellation of,
or result in or require the creation of any Lien (or any obligation to create
any Lien) other than Permitted Liens on any of the properties or assets of any
member of the Buying Group under (a) any Law applicable to any member of the
Buying Group or any of their properties or assets, (b) any provision of any
Organizational Documents of any member of the Buying Group, or (c) any contract,
agreement or other instrument to which any member of the Buying Group is a party
or by which its properties or assets may be bound, except, in the case of
clauses (a) and (c), for violations, breaches, or defaults that, individually
and in the aggregate, have not had or resulted in a Buyer Material Adverse
Effect. Except as specified in Section 3.4 of the Buyer Disclosure Letter, no
Consent is required to be obtained or made by any member of the Buying Group in
connection with the execution and delivery of this Agreement or any Transaction
Agreement to which any member of the Buying Group shall be a party, or the
consummation of the transactions contemplated hereby or thereby, except where
the failure to obtain such Consent, individually and in the aggregate, would not
have or result in a Buyer Material Adverse Effect.
3.5. Undisclosed Liabilities, etc. No member of the Buying Group has any
liabilities or obligations of any nature, whether known, unknown, absolute,
accrued, contingent or otherwise and whether due or to become due, except (a) as
set forth in Section 3.5 of the Buyer Disclosure Letter, (b) as and to the
extent disclosed or reserved against in the Buyer Financial Statements or
specifically disclosed in the notes thereto and (c) for liabilities and
obligations that (i) are incurred after the date of the latest balance sheet as
included in the Buyer Financial Statements in the ordinary course of business
consistent with prior practice and are not prohibited by Section 5.4 (none of
which are incurred as a result of breach of contract, willful misconduct or
gross negligence) and
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(ii) individually and in the aggregate have not had or resulted in a Buyer
Material Adverse Effect.
3.6. Litigation. Section 3.6 of the Buyer Disclosure Letter sets forth a
list and summary description of all Litigation involving any member of the
Buying Group or the conduct or operations of the business of the Buying Group as
of September 2, 1999 in which the amount payable (in each case if adversely
determined, and without regard to whether the defense or liability in respect
thereof is covered by policies of insurance or any indemnity, contribution, cost
sharing or similar arrangement by or with any other Person) by any member of the
Buying Group would reasonably be expected to exceed $100,000. Except as set
forth in Section 3.6 of the Buyer Disclosure Letter, there is no Litigation
pending or, to the Buyer's Knowledge, threatened by, or against any member of
the Buying Group or any of its properties or assets, that, individually or in
the aggregate, has had or resulted in a Buyer Material Adverse Effect (in each
case, if adversely determined). There are no outstanding orders, judgments,
decrees or injunctions issued by any Governmental Authority against any member
of the Buying Group, or that in any way affect the business of the Buying Group
that, individually or in the aggregate, have had or resulted in a Buyer Material
Adverse Effect.
3.7. Affiliate Transactions. Section 3.7 of the Buyer Disclosure Letter
contains a complete and correct list of all written and to the Knowledge of the
Buyer, all oral, material agreements, contracts, arrangements or transfers of
assets or liabilities, whether or not entered into in the ordinary course of
business, to or by which any member of the Buying Group, on the one hand, and
the Buyer or any of its Affiliates (other than any member of the Buying Group),
on the other hand, are parties to that involve continuing liabilities and
obligations that, individually or in the aggregate, are material to any member
of the Buying Group.
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3.8. Absence of Changes. Since the date of the latest balance sheet
included in the Buyer Financial Statements until the date of this Agreement,
except as set forth in Section 3.8 of the Buyer Disclosure Letter, (a) the Buyer
and each member of the Buying Group has conducted the business of the Buying
Group in the ordinary course of business consistent with past practice in all
material respects and no Buyer Material Adverse Effect has occurred and (b) the
Buyer has neither declared nor paid any dividend on, made any distribution on,
nor redeemed (except for repurchases of capital stock from members of management
of the Buyer and its Subsidiaries) any shares of its capital stock.
3.9. Tax Matters. All material Tax returns relating to a member of the
Buying Group that were required to be filed have been filed and all Taxes shown
as due thereon have been paid, except in each case, for any such failure that,
individually and in the aggregate, has not had or resulted in a Buyer Material
Adverse Effect.
3.10. Assets. The Buying Group has good and valid title to, or in the case
of leased property has good and valid leasehold interests in, all assets that
are material to the business of the Buying Group, including but not limited to
all such assets reflected in the latest balance sheet included in the Buyer
Financial Statements or acquired since the date thereof (except as may be
disposed of in the ordinary course of business after the date thereof and in
accordance with this Agreement), in each case free and clear of any Lien other
than Permitted Liens and Liens pursuant to the existing credit facility of the
Buyer and its Subsidiaries.
3.11. Brokers, Finders, etc. All negotiations relating to this Agreement,
the Transaction Agreements and the transactions contemplated hereby and thereby
have been carried on without the participation of any Person acting on behalf of
the Buyer or any of its Affiliates in such manner as to, and the transactions
contemplated hereby and thereby
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will not otherwise, give rise to any valid claim against the Seller for any
brokerage or finder's commission, fee or similar compensation.
3.12. Purchase for Investment. The Buyer is purchasing the Target Stock
and subscribing for the U.K. Shares solely for investment, with no present
intention to resell the Target Stock or the U.K. Shares. The Buyer hereby
acknowledges that the Target Stock has not been registered pursuant to the
Securities Act or other applicable securities Laws and may not be transferred in
the absence of such registration or an exemption therefrom under such Act or
such Laws.
3.13. Availability of Funds. The Buyer has delivered to the Seller
complete and correct copies of (i) a commitment letter, dated September 14,
1999, addressed to the Buyer from The Chase Manhattan Bank, Chase Securities
Inc., Bank of America and Banc of America Securities LLC for the aggregate
amount of up to $450 million and (ii) a commitment letter, dated September 14,
1999, from Chase Securities Inc. and Banc of America Securities LLC with respect
to up to $250 million of note financing for the transactions contemplated by
this Agreement (together, the "Financing Letters"). As of the date hereof, the
Buyer knows of no fact or circumstance that it believes will prevent it from
obtaining the financing, pursuant to the Financing Letters or otherwise,
necessary to pay the Cash Purchase Price and to perform its other obligations
hereunder. As of the date hereof, the Buyer has not received any notice that the
Financing Letters have been withdrawn.
3.14. Year 2000. (a) The Buying Group has developed and commenced a plan
which sets forth steps to ensure that all Computer Systems used or held for use
by the Buying Group are, or will be before and shall remain during and after
January 1, 2000, Year 2000 Compatible (the "Buyer Y2K Plan"). Pursuant to the
Buyer Y2K Plan, the Buying Group has conducted an inventory and/or other
investigations of any and all
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Computer Systems used by such member or held for use by such member of the
Buying Group in order to determine which parts of such Computer Systems are not
Year 2000 Compatible and to estimate the cost of rendering such Computer Systems
Year 2000 Compatible prior to January 1, 2000.
(b) The Buyer Y2K Plan includes reasonable steps to investigate the Year
2000 Compatibility of the Computer Systems of all suppliers with which any
member of the Buying Group has a relationship material to the business of the
Buyer as currently conducted by such member of the Buying Group. Each member of
the Buying Group has a reasonable basis to believe, and does believe, that the
Computer Systems of all such suppliers and customers are, or will be before and
shall remain during and after January 1, 2000, Year 2000 Compatible to the
extent necessary or desirable for such member of the Buying Group to be able to
continue to conduct the business of the Buyer as currently conducted without
material disruption prior to, during and after January 1, 2000. The Buyer Y2K
Plan includes reasonable contingency plans to minimize the effect of any failure
of any member of the Buying Group, or any such supplier or customer, to cause
its Computer Systems to be Year 2000 Compatible before January 1, 2000, which
plans include, without limitation, alternative sources for mission-critical
products and services. The Buying Group has provided or made available to the
Seller a copy of the Buyer Y2K Plan and a current status report thereon.
3.15. Buyer Disclosure Letter. Disclosure of any fact or item in any
Section of the Buyer Disclosure Letter shall be deemed to be disclosed with
respect to any other Section of this Agreement if (x) an explicit
cross-reference appears in such other Section of the Buyer Disclosure Letter or
(y) based on the disclosure in such first Section of the Buyer Disclosure Letter
it is readily apparent that the disclosure applies to such other Section of the
Buyer Disclosure Letter.
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ARTICLE IV
Covenants of the Seller
4.1. Conduct of the Moving Business. Except as set forth in Section 4.1 of
the Seller Disclosure Letter, on and after the date hereof to the Closing Date,
except as expressly permitted or required by this Agreement or as otherwise
expressly consented to in writing by the Chief Executive Officer, Chief
Financial Officer or General Counsel of the Buyer (which response shall not be
unreasonably delayed), with respect to the Moving Business, the Seller will, and
will cause each member of the Selling Group and the Company Group to:
(a) carry on the Moving Business in, and only in, the ordinary
course of business, in substantially the same manner as heretofore
conducted, and use commercially reasonable best efforts to preserve intact
in all material respects its present business organization, not dismiss
without cause its present officers and significant employees, and not
terminate without cause any relationships with customers, suppliers,
Agents, Authorized Representatives, Owner/Operators and others having
material business dealings with it;
(b) not declare dividends on, or redeem or repurchase any shares of,
any class of its capital stock, increase any obligations of any member of
the Company Group with respect to Indebtedness, repay any loans or other
amounts outstanding to the Seller or any of its Affiliates, make capital
expenditures in excess of $1,000,000 in any case or $10,000,000 in the
aggregate, pay any bonuses or advances against salaries except as set
forth in Section 4.1(b) the Seller Disclosure Letter, prepay any accounts
payable other than in the ordinary course, delay payment of any trade
payables other than in the ordinary course of business, or make any other
cash payments other than in the ordinary course of business, provided that
the Seller may
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cause members of the Company Group to make distributions of (x) cash
dividends so long as the Seller reasonably believes that, after giving
effect to such cash dividends, Closing Controllable Net Assets shall be
equal to or greater than L92,400,000 and (y) Specified Freehold
Property;
(c) maintain all of the tangible Assets and all other tangible
properties and assets owned, leased, occupied, operated or used by it and
that are material to the Moving Business in accordance with industry
standards and in reasonable repair subject only to ordinary wear and tear;
(d) not transfer, assign, mortgage, pledge, hypothecate, grant any
security interest in, or otherwise subject to any other Lien (other than
any Permitted Lien), any of its material assets;
(e) use commercially reasonable best efforts to keep in full force
and effect insurance comparable in amount and scope of coverage to
insurance now carried by it;
(f) pay accounts payable and other obligations, in the ordinary
course of business consistent with past practice;
(g) perform in all material respects all of its obligations under
any Material Contracts;
(h) not enter into or assume any Contract, or enter into or permit
any amendment, supplement, waiver or other modification in respect
thereof, except for such Contracts and amendments, supplements, waivers
and modifications thereof that, individually and in the aggregate, are not
material to any member of the Company Group or that are entered into,
assumed or permitted in the ordinary course of business following prior
notice to and consultation with the Buyer;
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(i) except in the ordinary course of business in connection with the
renewal of any arrangements with any Agent, Authorized Representative, or
Owner/Operator and following, in the case of any Agent or Authorized
Representative renewal, notice to, and consultation with, the Buyer, no
member of the Company Group shall make any material changes in policies or
practices relating to commission, sales incentives or otherwise in its
relations with Agents, Authorized Representatives and/or Owner Operators,
or accounting therefor;
(j) maintain in all material respects its books of account and
records in the usual, regular and ordinary manner consistent with past
policies and practice;
(k) comply in all material respects with all Laws applicable to it
or any of its properties, assets or business;
(l) not compromise, settle, grant any waiver or release relating to
any material Litigation, except in the ordinary course of business
consistent with past practice;
(m) not cause or permit any amendment, supplement, waiver or
modification to or of any of its Organizational Documents except as may
be required to perform its obligations under this Agreement;
(n) use commercially reasonable best efforts to maintain each U.S.
member of the Company Group's good standing in its state of incorporation
and in the jurisdictions in which it is qualified to do business as a
foreign corporation and to maintain all Consents necessary for, or
otherwise material to, the Moving Business;
(o) not merge or consolidate with, or agree to merge or consolidate
with, or purchase substantially all of the assets of, or otherwise
acquire, any business, business organization or division thereof, or any
other Person provided, that this
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provision shall not apply to any cash transactions in the ordinary course
of business where the total consideration paid does not exceed $200,000;
(p) not take any action or omit to take any action, which action or
omission would result in a breach of any of the representations and
warranties set forth in Section 2.8;
(q) promptly advise the Buyer in writing of any event, occurrence,
fact, condition, change, development or effect that, individually or in
the aggregate, has had or resulted in a Material Adverse Effect or a
breach of this Section 4.1;
(r) ensure that none of the Insurance Companies shall enter into any
new ceded quota share or other ceded reinsurance transaction (i) which
provides for cancellation or termination by the reinsurer for any reason
other than (x) for nonpayment of reinsurance premium, or (y) at the end of
a calendar quarter with prior written notice to the Insurance Companies,
(ii) which, except in the ordinary course of business, materially
increases or reduces its consolidated ratio of net written premiums to
gross written premiums or (iii) pursuant to which $1,000,000 or more in
gross written premiums are ceded by to any Person;
(s) ensure that none of the Insurance Companies enters into any new
assumed reinsurance transaction;
(t) ensure that none of the Insurance Companies will alter or amend
in any material respect their existing investment guidelines or policies;
(u) not agree or otherwise commit to take any of the actions
described in the foregoing paragraphs (b), (d), (h), (i), (l), (m) and
(p); and
(v) conduct all Tax affairs relating to the Company Group only
(i) in the ordinary course of business and consistent with past practice
(ii) in good faith and
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(iii) in substantially the same manner as such affairs would have been
conducted if this Agreement had not been entered into.
4.2. No Solicitation. (a) Neither the Seller nor any of its Subsidiaries
nor any of their respective officers, directors, employees, agents or
representatives (including, without limitation, investment bankers, attorneys
and accountants) shall, directly or indirectly (other than in connection with
the transaction contemplated by this Agreement), (i) solicit, initiate or
encourage any Acquisition Proposal, (ii) enter into any discussions or
negotiations with, in any way continue any discussions or negotiations commenced
before the date of this Agreement with, or disclose directly or indirectly any
information not customarily disclosed concerning its business and properties
to, or afford any access to its properties, books and records to, any Person in
connection with an Acquisition Proposal or (iii) enter into any agreement with
respect to an Acquisition Proposal or approve any Acquisition Proposal.
Notwithstanding the foregoing, in the event the Seller receives an unsolicited
Acquisition Proposal, the Seller may, solely for the purpose of clarifying the
terms of such Acquisition Proposal, submit written requests to the Person making
such proposal for additional information regarding such Acquisition Proposal.
The Seller and the Board of Directors of the Seller may not withdraw or modify,
or propose to withdraw or modify, its position with respect to the Acquisition
and the transactions contemplated by this Agreement and the Transaction
Agreements or approve or recommend any Acquisition Proposal, or enter into any
agreement with respect to any Acquisition Proposal, provided that in the event
(x) the Board of Directors has received an unsolicited Acquisition Proposal that
the Board of Directors has determined in good faith provides superior value to
the Seller and its stockholders compared to the transactions contemplated by
this Agreement and (y) the Board of Directors of the Seller, based upon the
advice of outside counsel, determines that its fiduciary duties so require, the
Board
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may modify or withdraw its recommendation of the Acquisition to the stockholders
of the Seller. The Seller and each member of the Selling Group and the Company
Group has terminated any activities, discussions or negotiations with any
parties conducted heretofore with respect to any of the foregoing.
(b) The Seller will notify the Buyer immediately, orally and in writing,
of any Acquisition Proposal or potential Acquisition Proposal of which the
Seller becomes aware and will include in such notification the material terms
and conditions of any such Acquisition Proposal. The Seller will keep the Buyer
informed in reasonable detail of the status (including amendments or proposed
amendments) of any such Acquisition Proposal.
4.3. Access and Information. (a) Until the earlier of the Closing Date or
the date this Agreement is terminated in accordance with Article X, the Seller
will (and will cause each other member of the Selling Group and the Company
Group, and each of the Representatives of or to any member of the Selling Group
and the Company Group, to) give the Buyer and its prospective lenders and
investors, and their respective Representatives, reasonable access during
reasonable business hours to all of such Person's respective properties, assets,
books, contracts, commitments, reports and records primarily relating to the
Moving Business or the Company Group, and furnish to them all such documents,
records and information with respect to the properties, assets and business of
the Company Group and copies of any work papers relating thereto as the Buyer
shall from time to time reasonably request; provided, that such access shall not
unreasonably interfere with operations of the Moving Business or the Selling
Group. In addition, the Seller will, and will cause each member of the Selling
Group and the Company Group to, permit the Buyer and its prospective lenders and
investors, and their respective Representatives, reasonable access during
reasonable business hours to each member of the Selling Group with respect to
the Moving Business and the Company
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Group, the Company Group's lenders, customers and suppliers, other Persons with
whom any member of the Company Group does or has done business, and other
Representatives or other personnel of any member of the Selling Group and the
Company Group, as may be reasonably necessary to the Buyer in connection with
its review of monthly unaudited financial information, properties, assets and
business of the Company Group and the above-mentioned documents, records and
information, provided, that prior to any discussions with customers, agents and
suppliers, the Buyer shall provide the Seller notice and a reasonable
opportunity to participate in such discussions.
(b) The Seller will, and will cause each other member of the Selling Group
and the Company Group to, retain all books and records relating to the Company
Group in accordance with the Seller's record retention policies as presently in
effect. During the seven-year period beginning on the Closing Date, the Selling
Group shall not dispose of or permit the disposal of any such books and records
not required to be retained under such policies without first giving 60 days'
prior written notice to the Buyer offering to surrender the same to the Buyer at
the Buyer's expense.
4.4. Monthly Financial Information. Within twenty-three (23) days after
the end of each monthly period after the date hereof until the earlier of the
Closing Date or the termination of this Agreement, the Seller shall deliver to
the Buyer complete and correct copies of the Management Reports and the Monthly
Combining Profit and Loss Statement as of and for each such monthly period,
which information shall be prepared from, and in accordance with the books and
records of the Company Group and on a basis consistent with the Management
Reports and the Monthly Combining Profit and Loss Statements previously
delivered by the Seller to the Buyer. Within fifteen (15) days of the date
hereof, the Seller shall deliver to the Buyer complete and correct copies of
Management Reports and the Monthly Combining Profit and Loss Statements, as of
and for each
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monthly period ended after June 30, 1999 that the Seller has not previously
delivered to the Buyer.
4.5. Public Announcements. Except as reasonably believed to be required by
applicable Law or the rules of the London Stock Exchange Limited or the City
Code on Take-overs and Mergers, the Seller shall not, and shall not permit any
other member of the Selling Group or the Company Group to, make any public
announcement in respect of this Agreement, the Transaction Agreements or the
transactions contemplated hereby or thereby without the prior written consent of
the Buyer.
4.6. Further Actions. (a) The Seller shall, and shall cause each other
member of the Selling Group and the Company Group to, use commercially
reasonable best efforts to take or cause to be taken all actions, and to do or
cause to be done all other things, necessary, proper or advisable in order for
each member of the Selling Group and the Company Group to fulfill and perform
its obligations in respect of this Agreement and the Transaction Agreements to
which it is a party, or otherwise to consummate and make effective the
transactions contemplated hereby and thereby.
(b) The Seller shall (and shall cause each other member of the Selling
Group and the Company Group to), as promptly as practicable, (i) make, or cause
to be made, all filings and submissions (including but not limited to under the
HSR Act and other applicable Law) required under any Law applicable to any
member of the Selling Group and the Company Group, and give such reasonable
undertakings as may be required in connection therewith, and (ii) use
commercially reasonable best efforts to obtain or make, or cause to be obtained
or made, all Material Consents to be obtained or made by any member of the
Selling Group and the Company Group, in each case in connection with this
Agreement or the Transaction Agreements, the purchase and sale of the Target
Stock and the Canada Assets and the issuance of the U.K. Shares, or the
consummation of the
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other transactions contemplated hereby or thereby. The Seller shall, and shall
cause each other member of the Selling Group and the Company Group to, (x) use
commercially reasonable best efforts to respond as promptly as practicable to
all inquiries received from the FTC or the Antitrust Division or any other
Governmental Authority for additional information or documentation and (y) use
commercially reasonable best efforts to resolve such objections, if any, that
may be asserted with respect to the purchase and sale of the Target Stock and
the Canada Assets, the issuance of the U.K. Shares as contemplated by this
Agreement or any Transfer Document, under the antitrust or comparable Laws of
any jurisdiction.
(c) The Seller shall, and shall cause each other member of the Selling
Group and the Company Group to, coordinate and cooperate with the Buyer in
exchanging such information and supplying such reasonable assistance as may be
reasonably requested by the Buyer in connection with the filings and other
actions contemplated by Section 5.2.
(d) At all times prior to the Closing Date, the Seller shall promptly
notify the Buyer in writing of any fact, condition, event or occurrence that
would result in the failure of any of the conditions contained in Sections 7.1
and 7.2 to be satisfied, upon becoming aware of the same.
(e) If any third party whose consent is required to transfer the benefit
of any Contract or Consent to the Buyer (the "Rights") does not consent to such
transfer: (i) the Seller shall hold the Rights as an agent of and trustee for
the Buyer and promptly deliver upon receipt any monies, goods or other benefits
received pursuant to the Rights; (ii) the Seller shall give all commercially
reasonable assistance to the Buyer at the Buyer's sole cost and expense, to
enable the Buyer to enforce the Rights against any person to whom the Rights
apply and shall take such actions with respect to the Rights as the Buyer shall
reasonably request and to which the Buyer shall agree in its reasonable
discretion; (iii) the
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Buyer shall indemnify and hold harmless the Seller against any loss, liability
cost or claim arising from or accruing as a result of any action taken on behalf
of the Buyer or as agent of and trustee for the Buyer in connection with
enforcement, transfer or performance under any of the Rights; and (iv) to the
extent such consent is required as a condition to assignment of any such
contract, this Agreement shall not be deemed an assignment of such Contract.
4.7. Further Assurances. Following the Closing Date, the Seller shall, and
shall cause each other member of the Selling Group and the Company Group to,
from time to time, execute and deliver such additional instruments, documents,
conveyances or assurances and take such other actions as shall be necessary, or
otherwise reasonably be requested by the Buyer, to confirm and assure the rights
and obligations provided for in this Agreement and the Transaction Agreements
and render effective the consummation of the transactions contemplated hereby
and thereby.
4.8. Stockholder Vote; Circular. (a) Promptly following the execution of
the Agreement, if required by applicable Law or stock exchange rules the Seller
shall cause a circular (together with any amendments or supplements thereto, and
including all exhibits, the "Circular") to be prepared and mailed to the
stockholders of the Seller with respect to the Acquisition and the transactions
contemplated hereunder which shall contain the recommendations of the Board of
Directors referred to in Section 2.29. Except as expressly permitted in Sections
4.2(a) and (b), the Board of Directors of the Seller will not withdraw, modify
or amend such recommendations.
(b) If the approval of the Acquisition by the stockholders of the Seller
is required under the rules of the London Stock Exchange Limited, the Circular
will comply in all material respects with the provisions of applicable Laws and
the Seller agrees to take all steps necessary to cause the Circular to be
disseminated to the stockholders of the
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Seller as and to the extent required by applicable Laws. The Circular will
contain (or will be amended in a timely manner so as to contain) all information
which is required to be included therein in accordance with applicable Law and
will comply in all material respects, both as to form and otherwise, with the
requirements of applicable Law.
4.9. Non-Compete. (a) (i) For a period of three years from the Closing
Date (the "Non-Compete Period"), subject to Section 4.9(a)(iii), the Seller and
its Affiliates (which term, for purposes of this Section 4.9(a) shall not
include a party that acquires, either directly or indirectly, all of the assets
or securities of the Selling Group following the Closing Date provided that such
party may not use any assets, personnel or know-how of the Selling Group in any
activity that would compete with the Moving Business in any geographic
territory) shall not, directly or indirectly (other than through its investment
in the Buyer), whether through an Agent, Authorized Representative or franchisee
or otherwise, engage in or own, operate, manage, control, invest in, act as
consultants or advisors to or otherwise assist any Person or entity that engages
in, the Moving Business in any geographic territory.
(ii) "Moving Business" means: (1) coordinating and arranging household to
household moves, including the packing, unpacking, moving and forwarding of
household goods and personal effects for individuals and employees of corporate
clients or government or military agencies or authorities or the short-term or
long-term storage and retrieval of household goods for such individuals and
employees; (2) the moving, delivery, installation and/or packing of plant
equipment, machinery, automation equipment, electronic or information technology
products and equipment, medical equipment, fitness equipment, trade show
exhibits and equipment and objects of art or art exhibits using specially
equipped transportation equipment and the related short-term or long-term
storage and retrieval of such products; (3) the coordinating and arranging and
moving,
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packaging and preparation for moving and/or unpacking and the provision of
related mechanical and electrical services, of industrial plant and machinery or
relocations of commercial facilities from one commercial location to another;
(4) the coordinating and arranging and moving, and/or packaging and preparation
for moving, of business or office equipment or furniture from one office,
warehouse or other business location to another; (5) the provision of records
management services, being the collection, cataloguing, storage, retrieval,
destroying or imaging of documents, records and archive material or providing
digital records management services, whether the records are in physical or
electronic format; (6) the provision of insurance services to customers and to
other participants in the Moving Business; (7) the provision of third party
relocation services, being private residential real estate brokerage services,
the arranging and coordination of a household to household move, insurance in
relation to relocation services, certain home management services (being tax
consulting, cultural assimilation, language and mortgage assistance services),
assistance in locating a new home for a client, consulting services and other
ancillary services in relation to relocation services; and (8) the supply and
hire of equipment and consumables used in the provision of or offered in
connection with the Moving Business.
(iii) Notwithstanding Section 4.9(a)(i), the Seller may continue to
engage, directly or indirectly through its Affiliates, in the Logistics Business
in any geographic territory.
(iv) "Logistics Business" means: (1) the provision of supply chain
management services, namely transport, distribution and warehousing services,
stock control and related consultancy services provided in order to facilitate
the movement of goods throughout the distribution process, including the
following services provided in connection with such supply management services:
(A) providing inventory, ordering,
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billing, duty management, customs services and the storage and retrieval of
documents and records necessary for the provision of the Logistics Business by
the Seller, (B) providing insurance (other than insurance relating to the
freight forwarding of household goods and personal effects for individuals and
used office furniture) to customers of the Logistics Business and to the owner
operators of Merchants Home Delivery Services, in each case as currently
provided by the Seller in connection with the Logistics Business, (C) moving
plant equipment and machinery for customers of the Logistics Business as
currently provided by the Seller's logistics division, (D) providing the
logistics services currently provided by the Seller's logistics division to the
Master Agreement Customers, and (E) the supply and hire of equipment and
consumables owned by the Seller and used by the Seller solely in the provision
of the Logistics Business by the Seller; (2) managing and providing home
delivery services of new, reconditioned or repaired merchandise and the related
removal of unwanted, damaged or used merchandise; (3) freight forwarding
services of goods (other than household goods and personal effects for
individuals and used office furniture), in each case from a manufacturing or
distribution center or a similar commercial location; (4) delivering and
installing new, reconditioned or repaired furniture, medical equipment,
automation equipment or electronic or information technology equipment,
including PCs, telecoms, photocopiers, catering and vending machines and the
related removal of used equipment, in each case, not comprising (x) the moving
of a substantial portion of a customer's business location or department thereof
from one location to another or (y) the moving of a portion of a customer's
business operations within such customer's business location and (5) moving
equipment, plant and machinery held for use by the Seller and keeping the books
and records of the Seller.
(v) The Seller and its Affiliates hereby agree to use their commercially
reasonable best efforts to continue the sub-contracting arrangements existing as
of the
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date hereof, pursuant to which certain members of the Company Group provide
services to customers of the Selling Group, including the Master Agreement
Customers; provided, that the provision of services by members of the Company
Group under such sub-contracting arrangements following the Closing Date shall
be in a form reasonably acceptable to the Seller in its reasonable judgment.
(b) Notwithstanding the foregoing, however, the Seller and its Affiliates
may, without violating this covenant: (A) continue to engage in any business
activity carried on by the Seller or any of its Affiliates, other than the
Moving Business, in the 24 months immediately preceding the Closing Date, and
(B) subject to the provisions of Section 4.9(c) below, acquire any company or
business (a "Seller Acquired Business") whose operations include the Moving
Business in a geographic territory in which the Company Group currently operates
(the "Competing Operations"); provided, that (i) the Competing Operations
represent less than $50,000,000 of revenue per year of such Seller Acquired
Business and (ii) the Seller or its Affiliate uses its commercially reasonable
best efforts to divest such Competing Operations within one year after the
consummation of the acquisition of such Seller Acquired Business.
(c) The Seller agrees that until the expiration of the Non-Compete Period,
in the event any Seller Acquired Business includes Competing Operations as set
forth in Section 4.9(b), then within 45 days after acquiring such Competing
Operations, the Seller will deliver written notice of such acquisition to the
Buyer (a "Purchase Notice"). The Purchase Notice shall include financial
statements of the Competing Operations, shall set forth a description of the
Competing Operations, the purchase price (the "Business Price") that the Seller
seeks to obtain in connection with the divestiture of such Competing Operations,
and a summary of the material terms and provisions of the purchase agreement
pursuant to which the Seller or its Affiliate acquired the Seller Acquired
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Business, including, without limitation, any representations and warranties and
indemnification provisions (collectively, the "Business Terms"). Upon delivery
of the Purchase Notice, the Buyer (or such Affiliate as is designated by the
Buyer) shall have the right to buy, and the Seller or its Affiliate or
Subsidiary shall have the obligation to sell, such Competing Operations to the
Buyer (or such Affiliate) (a "Business Purchase Right") at a price equal to the
Business Price and on terms and conditions no more favorable to the Buyer (or
its Affiliate) than the Business Terms. A Business Purchase Right shall be
exercisable by the Buyer (or such Affiliate) by delivering written notice to the
Seller within 30 days (the "Exercise Period") after delivery of the applicable
Purchase Notice. The closing with respect to the exercise of any Business
Purchase Right shall take place at the principal office of the Buyer on the
fifth business day following satisfaction of customary closing conditions to be
mutually agreed upon by the parties to such sale; provided that the parties
shall use their commercially reasonable best efforts to consummate such sale
within 120 days of such Purchase Notice. In the event that the Buyer gives
notice that it does not wish to exercise a Business Purchase Right prior to the
expiration of the Exercise Period or fails to exercise a Business Purchase Right
within the Exercise Period, the Seller shall use its commercially reasonable
best efforts to sell the Competing Operations to an unaffiliated third party
within one year following the expiration date of the Exercise Period.
(d) For a period of three years from the Closing Date, the Seller and its
Affiliates from time to time shall not, directly or indirectly, solicit for
employment any officer, director or senior manager (each a "Key Employee") of
the Company Group; provided that the foregoing provision shall not prevent the
Seller and its Affiliates from hiring any such Key Employee (A) who responds to
a public advertisement placed by the Seller (or its Affiliate) not specifically
addressed, in whole or in part, to any employee or
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employees of the Company Group or the Buyer or its Affiliates, (B) who has not
been employed by the Company Group or the Buyer or its Affiliates during the
preceding twelve months, (C) who has been terminated by the Company Group or the
Buyer or its Affiliates or (D) who seeks employment with the Seller or its
Affiliates without solicitation by the Seller or such Affiliate in violation of
the terms hereof.
(e) Nothing in this Section 4.9 shall prohibit the Seller or any of its
Affiliates from time to time from being an owner of not more than five percent
of the outstanding stock of any class of securities of a publicly traded
corporation engaged in the Moving Business, so long as neither the Seller nor
any of its Affiliates actively participates in the management of such
corporation.
(f) The parties acknowledge and agree that (i) the covenants set forth in
this Section 4.9 are reasonable in geographical and temporal scope and in all
other respects, (ii) neither of them would have entered into this Agreement but
for the covenants contained herein, and (iii) the covenants contained herein
have been made in order to induce each of the parties to enter into this
Agreement.
(g) If, at the time of enforcement of this Section 4.9, a court shall hold
that the duration, scope or area restrictions stated herein are unreasonable
under the circumstances then existing, the parties agree that the maximum
duration, scope or area reasonable under such circumstances shall be
substituted for the stated duration, scope or area.
(h) Each of the parties recognizes and affirms that in the event of its
breach of any provision of this Section 4.9, money damages would be inadequate
and the damaged party would have no adequate remedy at law. Accordingly, each of
the parties shall have the right, in addition to any other rights and remedies
existing in its favor, to enforce its rights under this Section 4.9 not only by
an action or actions for damages, but also by an action or actions for specific
performance, injunction and/or other equitable
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relief in order to enforce or prevent any violations (whether anticipatory,
continuing or future) of the provisions of this Section 4.9. In the event that
any action should be brought in equity to enforce the provisions of this
Agreement, neither party will allege, and each of the Seller and Buyer hereby
waives the defense, that there is an adequate remedy at law.
4.10. June 1999 Financial Statements. Within five business days after the
date hereof, the Seller shall deliver to the Buyer true and correct copies of
the unaudited combined financial statements of the Company Group as at and for
the nine-month period ended June 30, 1999, including a review report from Seller
Accountants and combined balance sheets, combined profit and loss accounts,
combined statements of total recognized gains and losses, combined cash flow
statements and combined statements of changes in NFC Group Investment, and
accompanying notes (collectively, the "June 1999 Financial Statements"). The
June 1999 Financial Statements shall be accompanied by a certificate, duly
executed by a senior financial officer of the Seller restating, with respect to
the June 1999 Financial Statements, the representations and warranties set forth
in Section 2.6(b) with respect to the Unaudited Financial Statements (and, for
purposes of this Agreement, such representations and warranties shall be deemed
to have been made under Article II of this Agreement).
4.11. Seller Accountants. Following the Closing, the Seller will cooperate
and use its commercially reasonable efforts to assist the Buyer and the Company
Group in connection with the preparation of the combined audited financial
statements of the Company Group as at September 30, 1999 and for the year then
ended.
4.12. Trademark Assignments. To the extent the trademark registrations and
applications included in the Owned Intellectual Property are not in the name of
a Target Subsidiary or a Subsidiary of a Target Subsidiary, the Seller shall
prepare or cause to be
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prepared, execute, and forward to the Buyer, trademark assignments in substance
and form reasonably satisfactory to the Buyer, as may be necessary or desirable
to record an appropriate Target Subsidiary (as indicated by the Buyer to the
Seller), or the Buyer, as applicable, as the record and beneficial owner of such
trademark registrations and applications. The Seller shall, and shall cause each
of its post-Closing Affiliates to, from time to time, execute and deliver to the
Buyer such additional instruments, documents, conveyances or assurances and take
all such other actions as shall be necessary or reasonably requested by the
Buyer to confirm and assure transfer of beneficial and record title, in all
relevant jurisdictions, to the relevant Target Subsidiary or the Buyer (as
applicable) in and to each such trademark registration and application. The
Buyer shall bear responsibility for, and pay, any costs associated with
recordation of any such assignments in the appropriate trademark offices.
4.13. Insurance. (a) In the event that, after the Closing, the Buyer or
any of its Affiliates (including but not limited to any member of the Company
Group or any successor thereto) shall suffer any loss, arising out of a third
party claim or otherwise, that the Buyer in good faith notifies the Seller would
be covered by any third party insurance policy maintained by or for the benefit
of any member of the Selling Group or the Company Group (an "Insured Claim"),
the Seller shall use its commercially reasonable efforts to, and shall cause
each member of the Selling Group to use its commercially reasonable efforts to,
present and diligently prosecute a claim for payment under such policy in
respect of such loss, and pay to the Buyer the proceeds of such claim under such
policy as reimbursement in respect of the amount of such loss, subject to the
provisions of this Section 4.13. Nothing contained in this Section 4.13 shall
limit the Seller's rights to present a claim for payment and receive the full
amount of reimbursement for any loss,
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arising out of a third party claim or otherwise, covered by an insurance policy
that is maintained by or for the benefit of any member of the Selling Group.
(b) Notwithstanding Section 4.13(a), the Seller shall not be obligated to,
or to cause any member of the Selling Group to, present or prosecute any claim
under any such insurance policy with respect to any Insured Claim unless
(i) such Insured Claim is based upon bodily injury, property damage, wrongful or
other acts or another condition or event that arose or occurred (as determined
under the applicable insurance policy) prior to the Closing and (ii) the Buyer
or the relevant Affiliate of the Buyer cooperates fully at its expense with the
Seller's insurers in the investigation of such Insured Claim and (in the case of
any Insured Claim arising out of a third party claim) the defense thereof and
(iii) the Seller receives notice of such Insured Claim from the Buyer in
accordance with Section 4.13(a) prior to the fifth anniversary of the Closing
Date. The Seller shall have the sole right to present or prosecute any claim
under any insurance policy maintained by or for the benefit of the Seller or any
Subsidiary of the Seller (other than any insurance policy maintained solely by
or for the benefit of a member of the Company Group), and to direct the defense
of any Insured Claim. Without limiting the foregoing, the Buyer shall cause each
of its Affiliates to comply with this Section 4.13, and not to make any claim
under any such insurance policy except through the Seller as provided in this
Section 4.13.
(c) The amount of proceeds of any such insurance claim to be paid over to
the Buyer shall be limited to the amount actually received by the Selling Group
from its insurers with respect to such claim (net of any self-insured retention
amount, deductible amount, or other amount that the Selling Group is required to
reimburse its insurers under its contractual agreements with them, in each case
with respect to such claim), minus the aggregate amount of all reasonable
out-of-pocket expenses incurred by the Selling Group in presenting and
prosecuting such claim (to the extent not paid or reimbursed by its
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insurers). The Buyer shall reimburse the Seller, upon written demand by the
Seller (accompanied by evidence reasonably satisfactory to the Buyer), for such
amount as the Seller is required to pay and does pay by way of retrospective
premium adjustment in respect of such insurance policy on account of any payment
by the insurer thereunder in respect of such claim.
(d) Nothing contained in this Section 4.13 shall require any member of the
Selling Group to keep in force and effect after the Closing any insurance
coverage in effect at the time of the Closing. The Seller will give the Buyer
(x) to the extent reasonably practicable, 30 days' prior written notice before
any member of the Selling Group terminates any insurance coverage in effect at
the time of the Closing and applicable to any member of the Company Group and
(y) prompt written notice in the event that any member of the Selling Group
receives notice from the insurer providing such coverage that such coverage is
being canceled or is not being renewed.
4.14. European and Asia Pacific Subsidiaries. The Seller shall cause NFC
International Holdings (Netherlands II) BV to own (immediately prior to the
Closing) all of the outstanding shares of capital stock of or other equity
interests (other than nominee shares held by nominee shareholders) in each
Subsidiary listed on Annex C-3 hereto.
4.15. U.K. Property Agreement. The Seller shall, and shall cause each
member of the Selling Group and each member of the Company Group that is a party
to the U.K. Property Agreement, dated the date hereof and attached hereto as
Exhibit J, to, fully comply with their respective obligations, covenants and
agreements set forth in the U.K. Property Agreement. The U.K. Property Agreement
shall not be amended or modified without the prior written consent of the Buyer.
4.16. Settlement of Intercompany Indebtedness. Effective as of immediately
before the Closing, the Seller shall settle or cause to be settled all
intercompany
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receivables or payables (including intercompany loans, notes or other agreements
or arrangements evidencing Indebtedness) then existing between any member of the
Selling Group, on the one hand, and any of the Company Group, on the other hand,
provided that the intercompany indebtedness between Pickfords Limited and the
Seller immediately prior to the Closing shall be fully repaid in cash on the
Closing Date using the subscription proceeds from the issuance of the U.K.
Shares. Upon the Closing Date, the Company Group shall cease to be part of the
Seller's cash management system.
ARTICLE V
Covenants of the Buyer
5.1. Public Announcements. Prior to the Closing, except as required by any
applicable Law, the Buyer shall not, and shall not permit any of its Affiliates
to, make any public announcement in respect of this Agreement, the Transaction
Agreements or the transactions contemplated hereby or thereby without the prior
written consent of the Seller.
5.2. Further Actions. (a) The Buyer shall, and shall cause each other
member of the Buying Group to, use commercially reasonable best efforts to take
or cause to be taken all actions, and to do or cause to be done all other
things, necessary, proper or advisable in order for each member of the Buying
Group to fulfill and perform its obligations in respect of this Agreement and
the Transaction Agreements to which it is a party, or otherwise to consummate
and make effective the transactions contemplated hereby and thereby.
(b) The Buyer shall, as promptly as practicable, (i) make, or cause to be
made, all filings and submissions (including but not limited to under the HSR
Act and other applicable Law) required under any Law applicable to the Buyer,
and give such reasonable undertakings as may be required in connection
therewith, and (ii) use all
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commercially reasonable efforts to obtain or make, or cause to be obtained or
made, all Material Consents to be obtained or made by the Buyer, in each case in
connection with this Agreement or the Transaction Agreements, the purchase and
sale of the Target Stock and the Canada Assets and the issuance of the U.K.
Shares, or the consummation of the other transactions contemplated hereby or
thereby; provided that nothing herein shall require any member of the Buying
Group to dispose of or hold separate any material portion of the business or the
assets of the Company Group or the Buying Group. The Buyer shall, and shall
cause each other member of the Buying Group to (x) use commercially reasonable
best efforts to respond as promptly as practicable to all inquires received from
the FTC or the Antitrust Division or any other Governmental Authority for
additional information or documentation and (y) use commercially reasonable best
efforts to resolve such objections, if any, that may be asserted with respect to
the purchase and sale of the Target Stock and the Canada Assets and the issuance
of the U.K. Shares as contemplated by this Agreement or any Transfer Document
under the antitrust or comparable Laws of any jurisdiction. The Buyer will
coordinate and cooperate with the Seller in exchanging such information and
supplying such reasonable assistance as may be reasonably requested by the
Seller in connection with the filings and other actions contemplated by
Section 4.6.
(c) At all times prior to the Closing Date, the Buyer shall promptly
notify the Seller in writing of any fact, condition, event or occurrence that
would result in the failure of any of the conditions contained in Sections 7.1
and 7.2 to be satisfied, promptly upon becoming aware of the same.
5.3. Guarantees, Joint Obligations. (a) To the extent that the Seller or
any of its subsidiaries is a guarantor of the obligations of any member of the
Company Group to any third party identified in Section 5.3 of the Seller
Disclosure Letter, (i) the Buyer
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agrees to cooperate with the Seller and to use its commercially reasonable best
efforts to have the Seller or any of its Subsidiaries released from all such
guarantees and (ii) the Buyer shall be solely responsible for the breach of any
such contract to the extent that such breach arises from the conduct of the
Moving Business from and after the Closing Date and shall indemnify the Seller
for any claims brought in connection with any such breach.
(b) Without limiting the generality of the foregoing, if the Naperville
Guarantor is not released as guarantor under the Naperville Guaranty as of the
Closing Date, then as long as the Naperville Guarantor remains as guarantor
under the Naperville Guaranty after the Closing Date, the Buyer shall cause the
Naperville Tenant to neither assign, convey, transfer, mortgage, grant a
security interest in or otherwise dispose of or encumber the Naperville Lease or
any interest therein, nor sublease, license or otherwise grant any right of use
or occupancy in the premises under the Naperville Lease to any other Person, and
the Buyer shall not cause or permit any change in voting or management control
of the Naperville Tenant, in each case without the prior written consent of the
Naperville Guarantor, which may be withheld in its sole discretion.
5.4. Conduct of Buyer's Business. On and after the date hereof to the
Closing Date, except as expressly permitted or required by this Agreement or as
otherwise expressly consented to by the Seller in writing, the Buyer will, and
will cause each member of the Buying Group to carry on the business of the
Buying Group in, and only in, the ordinary course of business, in substantially
the same manner as heretofore conducted, and use commercially reasonable best
efforts to preserve intact in all material respects its present business
organization, not dismiss without cause its present officers and significant
employees, and not terminate without cause any relationships with customers,
suppliers, Agents, Owner/Operators and others having material business dealings
with it. From and
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after the date hereof through the Closing Date, the Buyer shall neither declare
or pay any dividend on, make any distribution on, nor redeem (except for
repurchases of capital stock from members of management of the Buyer) any shares
of its capital stock.
5.5. Monthly Financial Information. Within fifteen days after the end of
each monthly period after the date hereof until the earlier of the Closing Date
or the termination of this Agreement, the Buyer shall deliver to the Seller
(i) an unaudited consolidated balance sheet of the Buying Group as of the end of
such monthly period and the related unaudited consolidated statements of income,
retained income and cash flows for the period then ended (together, the "Buyer
Monthly Unaudited Financial Information") and (ii) a certificate, duly executed
by the chief financial officer, the chief accounting officer or other senior
financial officer of the Buyer restating with respect to such Buyer Monthly
Unaudited Financial Information, the representations and warranties set forth in
Section 3.3 with respect to the Buyer Financial Statements.
5.6. Non-Solicitation. For a period of three years from the Closing Date,
the Buyer and its Affiliates from time to time shall not, directly or
indirectly, solicit for employment any Key Employee of the Selling Group;
provided that the foregoing provision shall not prevent the Buyer and its
Affiliates from hiring any such Key Employee (A) who responds to a public
advertisement placed by the Buyer (or its Affiliate) not specifically addressed,
in whole or in part, to any employee or employees of the Selling Group or its
Affiliates, (B) who has not been employed by the Selling Group or its Affiliates
during the preceding twelve months, (C) who has been terminated by the Selling
Group or its Affiliates or (D) who seeks employment with the Buyer or its
Affiliates without solicitation by the Buyer or such Affiliate in violation of
the terms hereof.
5.7. Access and Information. Until the earlier of the Closing Date or the
date this Agreement is terminated in accordance with Article X, the Buyer will
provide the
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Seller access to the books and records of the Buying Group and senior executive
officers of the Buyer to discuss matters relating to the business of the Buying
Group, including the Buyer Financial Statements delivered to the Seller pursuant
to this Agreement.
5.8. Buyer Financing. The Buyer shall and shall cause each member of the
Buying Group to use its commercially reasonable best efforts to satisfy the
conditions set forth in Section 8.8, including the conditions set forth in the
Financing Letters and if necessary, shall use its commercially reasonable best
efforts to obtain alternative financing arrangements. The Buyer shall give
prompt written or oral notice to the Seller of any material developments in the
progress or changes in the status of the financing of the transactions
contemplated by this Agreement.
5.9. Post-Closing Access to Company Group. Following the Closing, the
Buyer will cooperate and use its commercially reasonable best efforts to provide
reasonable access to the Seller and to assist the Seller in connection with the
preparation of (i) hyperion consolidated accounts files of the Seller (which
need to be produced by November 2 for the fiscal year ended September 30, 1999),
(ii) any filings required to be made by the Seller under applicable Law or stock
exchange regulations and (iii) any Tax Returns required to be filed by the
Selling Group. The Buyer also agrees to provide reasonable access to the Seller
following the Closing Date for purposes of the Seller's preparation of the
Closing Balance Sheet.
5.10. Non-Solicitation As To Moving Business. From the date hereof to the
Closing Date, neither the Buyer nor any of its Subsidiaries nor any of their
respective officers, directors, employees, representatives and agents including,
without limitation, investment bankers, attorneys and accountants shall,
directly or indirectly (other than in connection with the transaction
contemplated by this Agreement), (i) solicit, initiate or encourage any Target
Acquisition Proposal, (ii) enter into any discussions or negotiations
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with, in any way continue any discussions or negotiations commenced before the
date of this Agreement with, or disclose directly or indirectly any information
not customarily disclosed concerning its business and properties to, or afford
any access to its properties, books and records to, any Person in connection
with a Target Acquisition Proposal or (iii) enter into any agreement with
respect to a Target Acquisition Proposal or approve any Target Acquisition
Proposal.
ARTICLE VI
Covenants of the Buyer and the Seller
6.1. Transitional Arrangements. On the Closing Date, the Seller and the
Buyer shall enter into a Transitional Services Agreement, in the form attached
hereto as Exhibit C.
6.2. Right to Use Certain Marks; Name Changes. To the extent the
trademarks, service marks, brand names or trade, corporate or business names of
the Seller or of any of the Seller's Affiliates or divisions (other than any
member of the Company Group) are applied to or used as of the Closing Date on
stationery, signage, invoices, receipts, forms, packaging, advertising and
promotional materials, product, training and service literature and materials,
software or like materials of the Company Group ("Marked Materials") or appear
on the Company Group's inventory (including work-in-process and inventory on
order), as of the Closing Date, the Company Group may use such Marked Materials
after the Closing Date without altering or modifying such Marked Materials, or
removing such trademarks, service marks, brand names, or trade, corporate or
business names. In such event, the Seller hereby grants to the Buyer and the
Company Group an irrevocable, fully paid-up license, to remain in effect until
the exhaustion of such Marked Materials in the ordinary course of business, to
use any such trademarks, service marks, brand names, trade, corporate or
business names in connection
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with such Marked Materials. The Company Group agrees to exhaust such Marked
Materials in the ordinary course of business as soon as is reasonably
practicable after the Closing, but in any event within nine (9) months after the
Closing Date. The Buyer further agrees that at no time after the Closing Date
will it or any member of the Company Group represent, imply or otherwise state
that it is affiliated with the Seller except as set forth in the shareholder
documents to which the Seller and the Buyer are a party. Except as provided in
this Section 6.2, no interest in or right to use any trademark, service mark,
brand name or trade, corporate or business name or other Intellectual Property
of the Seller or any Seller Affiliate or division (other than the Company
Intellectual Property) is being transferred to the Buyer pursuant hereto. Prior
to the Closing, the Seller will change the name of the members of the Company
Group marked with an asterisk on Annex C-2 to eliminate the tradename "NFC" from
the corporate names thereof.
6.3. Confidentiality. (a) Existing Agreement. The parties hereto agree
that with respect to the disclosure of information furnished hereunder or in
connection herewith, the parties shall continue to be bound by the terms of that
certain letter agreement, dated December 9, 1998 (the "Confidentiality
Agreement"), between North American Van Lines, Inc. and the Seller. The Seller
agrees to cause each member of the Selling Group to comply with the provisions
of the Confidentiality Agreement as if each of them were parties to such
agreement. From and after the Closing Date, the Buyer and its Affiliates and
Representatives shall have no further liability or obligation under the
Confidentiality Agreement with respect to information, agreements or documents
of or relating to the Company Group.
(b) Post-Closing Confidentiality. (i) From and after the Closing Date, the
Seller shall not disclose to any Person or use, and shall not permit any other
member of the Selling Subsidiaries (together with the Seller, "Seller Parties")
or any officers, directors or
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employees of the Seller or any other member of the Selling Group to disclose to
any Person or use, and shall use its reasonable efforts to prevent the
respective other Representatives and contractors of any member of the Selling
Group (such officers, directors, employees, other Representatives and
contractors, "Seller Representatives") from disclosing to any Person or using,
(x) until the second anniversary of the Closing Date shall have occurred, any
Buyer Information (as hereinafter defined) that has been previously furnished by
or on behalf of the Buyer to any Seller Representative, or is so furnished prior
to or on the Closing Date, or otherwise is known to any Seller Party on the
Closing Date, or (y) any Confidential Buyer Information (as hereinafter defined)
that becomes known to any Seller Party after the Closing Date pursuant to this
Agreement or any Transaction Agreement or in connection with any of the
transactions contemplated hereby or thereby. The term "Buyer Information" means
any information concerning the Buyer or any member of the Company Group, or the
business, activities or operations of the Buyer or any member of the Company
Group, including but not limited to information relating to pricing,
technologies, trade secrets, processes, customers, suppliers, financial data,
statistics, or research and development, other than information that (1) is or
becomes generally available to the public other than as a result of a disclosure
by any Seller Party or Seller Representative, or (2) any Party or Seller
Representative is required to disclose by law or legal process or pursuant to
the rules of the London Stock Exchange Limited or other securities exchange,
including historical financial information of the Company Group prior to the
Closing Date. The term "Confidential Buyer Information" means any Buyer
Information that the receiving Seller Party knows or reasonably should know is
confidential or proprietary, or that the Buyer or any member of the Company
Group has identified in writing to the receiving Seller Party as being
confidential or proprietary.
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(ii) From and after the Closing Date, the Buyer shall not disclose to any
Person or use, and shall not permit any member of the Company Group or any
Affiliates of the Buyer (together with the Buyer, "Buyer Parties") or any
officers, directors or employees of the Buyer Parties to disclose to any Person
or use, and shall use its reasonable efforts to prevent the respective other
Representatives and contractors of the Buyer or any member of the Company Group
(such officers, directors, employees, other Representatives and contractors,
"Buyer Representatives") from disclosing to any Person or using, (x) until the
second anniversary of the Closing Date shall have occurred, any Seller
Information (as hereinafter defined) that has been previously furnished by or on
behalf of the Seller to any Buyer Representative, or is so furnished prior to or
on the Closing Date, or otherwise is known to any Buyer Party on the Closing
Date, or (y) any Confidential Seller Information (as hereinafter defined) that
becomes known to any Buyer Party after the Closing Date pursuant to this
Agreement or any Transaction Agreement or in connection with any of the
transactions contemplated hereby or thereby. The term "Seller Information" means
any information concerning the Seller, or the business, activities or operations
of the Seller, including but not limited to information relating to pricing,
technologies, trade secrets, processes, customers, suppliers, financial data,
statistics, or research and development, other than information that (1) is or
becomes generally available to the public other than as a result of a disclosure
by any Buyer Party or Buyer Representative, or (2) any Buyer Party or Buyer
Representative is required to disclose by law or legal process. The term
"Confidential Seller Information" means any Seller Information that the
receiving Buyer Party knows or reasonably should know is confidential or
proprietary, or that the Seller has identified in writing to the receiving Buyer
Party as being confidential or proprietary.
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(iii) In the event that any Seller Party is requested in any proceeding to
disclose any Buyer Information, the Seller shall give the Buyer prompt written
notice of such request so that the Buyer may seek an appropriate protective
order. If in the absence of a protective order any Seller Party is compelled in
a proceeding to disclose Buyer Information, such Seller Party may disclose such
portion of the Buyer Information that in the opinion of the Seller's counsel
such Seller Party is compelled to disclose, without liability under this
Agreement, provided, however, that the Seller shall give the Buyer written
notice of the Buyer Information to be disclosed as far in advance of its
disclosure as is practicable and shall use reasonable efforts to obtain
assurances that confidential treatment will be accorded to such Buyer
Information. In the event that any Buyer Party is requested in any proceeding to
disclose any Seller Information, the Buyer shall give the Seller prompt written
notice of such request so that the Seller may seek an appropriate protective
order. If in the absence of a protective order any Buyer Party is compelled in a
proceeding to disclose Seller Information, such Buyer Party may disclose such
portion of the Seller Information that in the opinion of the Buyer's counsel
such Buyer Party is compelled to disclose, without liability under this
Agreement, provided, however, that the Buyer shall give the Seller written
notice of the Seller Information to be disclosed as far in advance of its
disclosure as is practicable and shall use reasonable efforts to obtain
assurances that confidential treatment will be accorded to such Seller
Information. The Seller agrees that neither it nor any other Seller Party will
appropriate any proprietary Buyer Information for its or their benefit, and the
Buyer agrees that neither it nor any other Buyer Party will appropriate any
proprietary Seller Information for its or their benefit.
(iv) The Seller and the Buyer each acknowledge that the other such party
and its Affiliates would be irreparably damaged in the event of a breach or a
threatened breach
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of any of the acknowledging party's obligations under this Section 6.3(b), and
agrees (and shall cause each member of the Selling Group, in the case of the
Seller, and each member of the Company Group, in the case of the Buyer, to
agree) that, in the event of a breach or a threatened breach of any such
obligation, the other such party shall, in addition to any other rights and
remedies available to it in respect of such breach, be entitled to an injunction
from a court of competent jurisdiction granting it specific performance of the
provisions of this Section 6.3(b).
(v) The provisions of this Section 6.3 shall not restrict the Buyer or any
member of the Company Group, or the Seller or any other member of the Selling
Group, from using Information in performing their respective obligations under,
or enforcing the terms of, this Agreement or any Transaction Agreement, or in
exercising their respective rights relating hereto or thereto or to the
transactions contemplated hereby or thereby.
6.4. [Intentionally Omitted.]
6.5. Notice of Developments. The Seller may elect at any time to notify
the Buyer of any development causing a breach of any of the representations and
warranties in Article II. Unless the Buyer has the right to terminate this
Agreement pursuant to Section 10.1(d) below by reason of the development and
exercises that right within the period of twenty (20) days referred to in
Section 10.1(d) below, the written notice pursuant to this Section 6.5 will be
deemed to have amended the Seller Disclosure Letter, to have qualified the
representations and warranties in this Article II, and to have cured any
misrepresentation or breach of warranty that otherwise might have existed
hereunder by reason of the development; provided that any such amendment,
qualification or cure shall be limited to the purposes of Section 8.1(a), and
shall not apply for the purposes of Section 11.1.
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6.6. Employee Matters. (a) Equity Based Compensation Plans. The Seller
shall retain all liabilities related to equity based awards granted to employees
of the Company Group under any of Seller's equity based compensation plans
except to the extent such liability is (i) reflected as a liability in the
Closing Balance Sheet and (ii) included in the definition of Closing
Controllable Net Assets.
(b) Continuation of Compensation and Benefits. For a period of not less
than one year following the Closing Date, the Buyer shall provide employees of
the Company Group with compensation and benefits which are substantially similar
in the aggregate to the compensation and benefits provided to such employees as
of the date of this Agreement; provided that the Buyer's obligation to provide
such compensation and benefits shall not apply with respect to any equity based
compensation, deferred compensation programs or executive perquisites provided
to Company Group employees as of the date of this Agreement.
(c) Canadian Employee Benefit Matters. (i) At least two business days
prior to the Closing Date, the Buying Canada Subsidiary shall, with effect from
and after the Closing but conditional upon the Closing, offer employment to all
employees of the Selling Canada Subsidiary who are engaged in the Moving
Business on substantially the same terms and conditions as such employees are
presently employed by the Selling Canada Subsidiary. Section 6.6(c) of the
Seller Disclosure Letter sets forth a list of all employees of the Selling
Canada Subsidiary who are engaged in the Moving Business as of the date hereof.
Those employees who accept such offers of employment effective as of the Closing
Date shall be referred to herein as the "Transferred Employees". The Buying
Canada Subsidiary shall recognize and preserve, for all purposes other than
accrual of pension benefits, the Transferred Employees' years of service with
the Selling Canada Subsidiary and any Affiliates thereof. Without limiting the
scope of the foregoing, the
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Buying Canada Subsidiary shall provide to the Transferred Employees employment
conditions, benefits, responsibilities and duties which are substantially
similar to those upon which the employees of the Selling Canada Subsidiary are
presently employed by the Selling Canada Subsidiary and the Buying Canada
Subsidiary shall, with respect to each Transferred Employee, honor outstanding
vacation entitlements.
(ii) The Selling Canada Subsidiary shall retain liabilities for all
expenses, costs and other liabilities and obligations of any kind whatsoever
arising out of or in connection with the termination of employment of those
employees of the Selling Canada Subsidiary who do not accept the Buying Canada
Subsidiary's offer of employment referred to in Section 6.6(c)(i) above.
(d) Retirement Plan Discrimination Testing. Prior to the Closing Date, the
Seller shall provide the Buyer with testing results, in form reasonably
satisfactory to the Buyer, demonstrating that the Allied Van Lines, Inc.
Retirement Plan is in compliance with the non-discrimination and coverage
requirements set forth under ERISA and the Code.
(e) Consultation Rights. The Seller shall not engage in any consultation
or communication related to the terms of this Agreement with any collective
bargaining group of employees or any works councils, without the prior consent
of the Buyer.
(f) Change of Control Agreements. The Seller shall retain all liabilities
related to existing change of control agreements with employees of the Company
Group, including, without limitation, all liabilities for performance bonuses,
completion bonuses, accelerated vesting of awards and severance protection
payments that are provided under such agreements (in the case of any such
performance bonus or severance protection payment, only to the extent such
payment exceeds the amount that would have been payable under the Seller's
performance bonus or severance arrangement (as the case may
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be) applicable to such employee as in effect immediately prior to the date of
such change in control agreement).
6.7. Check the Box Elections. Buyer and Seller shall, and shall cause
their respective Affiliates and advisors to, cooperate with each other in
connection with the preparation and filing of the election forms contemplated by
Section 8.10. Seller shall provide drafts of such forms (including the Forms
8832 and SS-4) to Buyer and its advisors within two weeks after the date hereof,
or, in the case of any Designated Target designated by Buyer after the date
hereof, within two weeks after the date of such designation, but in any event no
later than one week prior to the Closing Date. Such drafts shall be based on
information theretofore provided between the Buyer and the Seller.
6.8. Preferred Stock. The Seller shall bear (and reimburse, indemnify and
hold harmless the Buyer, its Affiliates and their respective officers,
directors, employees, agents, advisers and representatives for, from and
against) any and all Taxes (including but not limited to any tax under Chapter 3
of Subtitle A of the Internal Revenue Code and any Taxes that were not
previously paid by the Buyer pursuant to the provisions of this Section 6.8)
imposed in respect of any share of Junior Preferred Stock (including without
limitation in respect of any actual or deemed dividends in respect of any such
share). If and to the extent that the Buyer pays any Tax in respect of any share
of Junior Preferred Stock and such Tax payment either actually reduces the
amount of a cash distribution otherwise payable on such share pursuant to
paragraph (l)(iv)(A) of the Preferred Stock Certificate of Designation or
actually reduces the Liquidation Preference (as defined in the Certificate of
Designation) of such share pursuant to paragraph (l)(iv)(B) of the Preferred
Stock Certificate of Designation (and thereby actually reduces the amount
payable to the holder in exchange for such share), the Seller shall have no
further liability under this
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Section 6.8 in respect of such Tax payment. In the event that the Buyer intends
to make a Tax payment in respect of any share of Junior Preferred Stock, the
Buyer shall provide notice to the Seller of such anticipated Tax payment at
least 10 days prior to making such payment. If and to the extent that the Seller
provides the Buyer with a form, certificate, opinion of counsel or other
evidence, reasonably satisfactory to the Buyer, to the effect that such Tax
payment is not required or that a lower Tax payment is required, the Buyer shall
not make such Tax payment or shall make such lower Tax payment, as the case may
be. In the event any taxing authority shall propose a deficiency in the amount
of Tax in respect any share of Junior Preferred Stock (or shall assess any such
Tax), the Seller shall control, at its own expense, the conduct of all stages of
any negotiation, settlement discussion, agreement process, dispute, audit or
other administrative or judicial proceeding, to the extent related to such
proposed deficiency or assessment. Upon the receipt of any such notice of a
proposed deficiency, the Buyer shall promptly notify Seller of same, and shall
furnish Seller or its agent with powers of attorney (or any other document or
authorization) necessary or appropriate to carry out the provisions of the
preceding sentence. Buyer may pay any such proposed deficiency to a governmental
authority unless reasonably requested by the Seller to refrain from making such
payment pending the outcome of related proceedings. For the avoidance of doubt,
the Seller may not request the Buyer to refrain from making any such payment if,
as a result of not making such payment, the taxing authority may seek payment
from any officer, director, employee, agent, adviser or representative of the
Buyer or its Affiliates as a "responsible person".
6.9. U.K. Property Agreement Consents. In the event that any of the
consents required to be obtained pursuant to the U.K. Property Agreement are not
obtained prior to the applicable deadline set forth in the U.K. Property
Agreement, the
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Buyer and the Seller agree to cooperate with one another in good faith and to
take all actions reasonably necessary in order to locate similar leased or
subleased property; provided that the reasonable costs and expenses incurred by
a party in locating, moving to and occupying such similar leased or subleased
property in excess of the rent under the lease for which such consent was
required shall be at the sole expense of the party responsible for such consent
under the U.K. Property Agreement.
ARTICLE VII
Conditions to Obligations of Each Party
The obligations of the Seller and the Buyer to consummate the transactions
contemplated hereby shall be subject to the fulfillment on or prior to the
Closing Date of the following conditions:
7.1. No Injunction, etc. Consummation of the transactions contemplated
hereby or by the Transfer Documents shall not have been restrained, enjoined or
otherwise prohibited or made illegal by any applicable Law, including any order,
injunction, decree or judgment of any court or other Governmental Authority; and
no such Law that would have such an effect shall have been promulgated, entered,
issued or determined by any court or other Governmental Authority to be
applicable to this Agreement or by the Transfer Documents; provided that the
party seeking to invoke this Section 7.1 shall have used all reasonable best
efforts to have any such order, injunction, decree or judgment lifted or
reversed.
7.2. Antitrust Notifications. The notifications of the Buyer and the
Seller pursuant to the HSR Act and the Other Antitrust Approvals, if any, shall
have been made and the applicable waiting period and any extensions thereof
shall have expired or been terminated, provided that the party seeking to invoke
this Section 7.2 shall have used its reasonable best efforts to file any
application required to be filed under applicable Law and
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provided further that the Buyer may not invoke this Section 7.2 with respect to
approvals required in Germany and Australia unless the Buyer shall have filed an
application with the relevant Governmental Authorities in Germany and Australia
on or before the 10th business day following the date hereof.
7.3. Insurance Department Approvals. All Insurance Department Approvals
required to be made or obtained by any member of the Selling Group or the
Company Group or the Buyer and its Subsidiaries in connection with the execution
and delivery of this Agreement and the Transaction Agreements or the
consummation of the transactions contemplated hereby or thereby shall have been
made or obtained.
ARTICLE VIII
Conditions to Obligations of the Buyer
The obligations of the Buyer to consummate the transactions contemplated
hereby shall be subject to the fulfillment on or prior to the Closing Date of
the following additional conditions, which the Seller agrees to use commercially
reasonable best efforts to cause to be fulfilled:
8.1. Representations, Performance. (a) The representations and warranties
of each member of the Selling Group contained in this Agreement or in any
Transaction Agreement shall be true and correct in all respects at and as of the
date hereof, and at and as of the Closing Date with the same effect as though
made on and as of the Closing Date except where the failure to be true and
correct, individually and in the aggregate, has not had or resulted in a
Material Adverse Effect.
(b) The Seller shall have in all material respects duly performed and
complied with all agreements, covenants and conditions required by this
Agreement to be performed or complied with by the Seller prior to or on the
Closing Date, except for such nonperformance or noncompliance which has not had
or resulted in a Material Adverse Effect.
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(c) The Seller shall have delivered to the Buyer a certificate, dated the
Closing Date and signed by the Seller, to the effect set forth above in Section
8.1(a).
8.2. Consents. All Material Consents shall have been made or obtained.
Complete and correct copies of all such Material Consents shall have been
delivered to the Buyer.
8.3. Resignation of Directors. All directors shall appoint the new
directors designated by the Buyer and all directors and officers of any member
of the Company Group whose resignations shall have been requested by the Buyer
not less than five days prior to the Closing Date shall have submitted their
resignations or been removed from office effective as of the Closing Date.
8.4. FIRPTA Certificate. The Seller shall have delivered to the Buyer a
certificate, as contemplated under and meeting the requirements of section
1.1445-2(b)(2)(i) of the Treasury Regulations, to the effect that NFC
International Holdings (USA) Investment Company is not a foreign person within
the meaning of the Code and applicable Treasury Regulations.
8.5. No Material Adverse Effect. Since the date hereof, no Material
Adverse Effect shall have occurred.
8.6. Transaction Agreements. Each of the Transfer Documents and the
Ancillary Agreements shall have been executed and delivered by each member of
the Selling Group party thereto.
8.7. Opinion of Counsel. The Buyer shall have received an opinion,
addressed to it and dated the Closing Date, from outside counsel to the Seller
(which may be more than one firm), in form and substance satisfactory to the
Buyer in its reasonable judgment, containing the opinions set forth in
Exhibit G.
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8.8. Financing. The Buyer shall have obtained, pursuant to the Financing
Letters or otherwise, the funds necessary to consummate the transactions
contemplated by this Agreement and the Transaction Agreements.
8.9. Certain Financial Statements. The Seller shall have delivered to the
Buyer the June 1999 Financial Statements as contemplated by Section 4.10.
8.10. Check the Box Elections. At least one business day prior to the
Closing Date, the Seller shall have caused an election to be duly and validly
filed with respect to each Designated Target pursuant to which such Designated
Target elects, effective no later than one business day prior to the Closing
Date, to be disregarded as an entity separate from its owner for U.S. federal
income tax purposes, as contemplated by U.S. Treasury Regulation ss. 301.7701-3,
and shall have taken no action that would alter the effect of any such election.
The form, substance and manner of filing of each such election shall have been
approved by the Buyer prior to the actual filing thereof, which approval shall
not be unreasonably withheld.
8.11. U.K. Property Agreement. All of the leases, subleases and other
transactions required to be entered into or completed by the Closing Date as
provided for in the U.K. Property Agreement shall have been entered into or
completed.
8.12. Termination of Intercompany Insurance. The insurance arrangements
between Allied Van Lines, Inc., on the one hand, and NFC Insurance Ltd., a
Guernsey company, and Transguard Insurance Ltd., a Bermuda company, shall have
been terminated and mutual general releases in form and content reasonably
acceptable to the Buyer shall have been executed by all parties to such
insurance arrangements.
ARTICLE IX
Conditions to Obligations of the Seller
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The obligation of the Seller to consummate the transactions contemplated
hereby shall be subject to the fulfillment, on or prior to the Closing Date, of
the following additional conditions, which the Buyer agrees to use commercially
reasonable best efforts to cause to be fulfilled:
9.1. Representations, Performance, etc. (a) The representations and
warranties of the Buyer contained in this Agreement shall be true and correct in
all respects at and as of the date hereof and at and as of the Closing Date with
the same effect as though made at and as of such time, except where the failure
to be true and correct, individually and in the aggregate, has not had or
resulted in a Buyer Material Adverse Effect.
(b) The Buyer shall have in all material respects duly performed and
complied with all agreements, covenants and conditions required by this
Agreement to be performed or complied with by it prior to or on the Closing
Date, except for such nonperformance or noncompliance which has not had or
resulted in a Buyer Material Adverse Effect.
(c) The Buyer shall have delivered to the Seller a certificate dated the
Closing Date and signed by the Buyer's President or a Vice President to the
effect set forth above in Section 9.1(a).
(d) The Buyer shall have delivered to the Seller the Common Stock
Certificate, the Preferred Shares Certificate and the Warrant.
9.2. No Buyer Material Adverse Effect. Since the date hereof, no Buyer
Material Adverse Effect shall have occurred.
9.3. Opinion of Counsel. The Seller shall have received an opinion,
addressed to it and dated the Closing Date, from outside counsel (which may be
more than one firm) for the Buyer, in form and substance satisfactory to the
Seller in its reasonable judgment, containing the opinions set forth in
Exhibit H.
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9.4. Transaction Agreements. Each of the Transfer Documents and the
Ancillary Agreements shall have been executed and delivered by each member of
the Buying Group thereto.
ARTICLE X
Termination
10.1. Termination. This Agreement may be terminated at any time prior to
the Closing Date:
(a) By the written agreement of the Buyer and the Seller;
(b) By the Buyer or the Seller after 5:00 p.m. New York City time on
March 31, 2000 if the transactions contemplated hereby shall not have been
consummated pursuant hereto unless the failure to consummate this
Agreement results primarily from a breach of any covenant by the party
seeking to terminate, unless such date is extended by the mutual written
consent of the Seller and the Buyer;
(c) By either the Buyer or the Seller by written notice to the other
party if:
(i) the other party shall (and the terminating party shall
not) have failed to perform and comply with, in all material
respects, all agreements, covenants and conditions hereby required
to have been performed or complied with by such party prior to the
time of such termination, and such failure (x) shall not have been
cured within thirty (30) days following notice of such failure, and
(y) individually, or in the aggregate, has had or resulted in a
Material Adverse Effect or a Buyer Material Adverse Effect, as the
case may be, or
(ii) the terminating party shall have become aware of any
fact, condition, event or occurrence that, individually or in the
aggregate, has caused or could reasonably be expected to cause the
representations and warranties of the other party not to be true and
correct in all material respects as of such date or the
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Closing Date as though made on and as of such date or the Closing
Date and such failure to be true and correct (x) shall not have been
cured within thirty (30) days following notice thereof and
(y) individually or in the aggregate, has had or resulted in a
Material Adverse Effect or a Buyer Material Adverse Effect, as the
case may be;
(d) By the Buyer by written notice to the Seller at any time prior
to the Closing in the event (i) Seller has within the then previous twenty
(20) days given the Buyer any notice pursuant to Section 6.5 above and
(ii) the development that is the subject of the notice, individually or in
the aggregate, has had or resulted in a Material Adverse Effect;
(e) By the Seller or the Buyer if the stockholders of the Seller
fail to approve the Acquisition, if required by applicable Law or stock
exchange regulation, or by the Buyer if the meeting of the stockholders of
the Seller contemplated by Section 4.8 has been called but does not take
place; or
(f) By the Seller by written notice to the Buyer no later 5:00 p.m.
on the fifth business day following the Seller's receipt of written notice
from the Buyer that any of the Financing Letters have been withdrawn.
10.2. Effect of Termination. (a) In the event of the termination of this
Agreement pursuant to the provisions of Section 10.1, this Agreement and
Ancillary Agreement executed as of the date hereof shall become void and have no
effect, without any liability to any Person in respect hereof or of the
transactions contemplated hereby on the part of any party hereto, or any of its
directors, officers, Representatives, stockholders or Affiliates, except as
specified in Sections 6.3, 11.1 and 11.2 and except for any liability resulting
from such party's breach of this Agreement and except as otherwise provided in
this Section 10.2.
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(b) Within two business days of the termination of this Agreement by the
Buyer or the Seller under Section 10.1(e) the Seller shall pay to the Buyer an
amount equal to the Buyer's actual and reasonably documented out-of-pocket
expenses incurred by the Buyer and its Affiliates in connection with the
Acquisition up and until the date of termination in an amount not to exceed
$6,000,000 (the "Expenses"). In addition, in the event that this Agreement shall
have been terminated by the Buyer or the Seller pursuant to Section 10.1(e) and
prior to the meeting of the stockholders of the Seller contemplated by Section
4.8, the Board of Directors of the Seller shall have modified or withdrawn its
recommendation to the stockholders of the Seller, the Seller shall pay to the
Buyer an amount equal to $4,000,000 (the "Termination Fee") concurrent with the
payment of the Expenses pursuant to the immediately preceding sentence in
Section 10.2(b). In the event that (a) the Buyer shall have been entitled to the
Termination Fee and (b) the Seller enters into an agreement with respect to an
Acquisition Proposal involving all or substantially all of the Moving Business
with any party other than the Buyer or one of its Affiliates on or prior to the
first anniversary of the date of termination of this Agreement, the Seller shall
pay to the Buyer an amount equal to $5,000,000 by wire transfer on the date the
transaction contemplated by such Acquisition Proposal is consummated.
(c) In the event that a Seller Acquisition Proposal has been received by
the Seller and (x) the meeting of the stockholders of the Seller contemplated by
Section 4.8 has been called and does not take place or (y) such meeting of the
stockholders of the Seller takes place but the stockholders of the Seller fail
to approve the Acquisition, then within two business days of the termination of
this Agreement under Section 10.1(e) the Seller shall pay to the Buyer an amount
equal to the Expenses and the Termination Fee. In addition, in the event that
(a) the Buyer shall have become entitled to the Termination Fee as set forth in
Section 10.2(c), (b) this Agreement shall have been terminated pursuant
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to Article XI and (c) the Seller enters into an agreement with respect to a
Seller Acquisition Proposal with any party on or prior to the first anniversary
of the date of termination of this Agreement, the Seller shall pay to the Buyer
an amount equal to $5,000,000 by wire transfer on the date such Seller
Acquisition Proposal is consummated.
ARTICLE XI
Indemnification
11.1. Indemnification by the Seller. (a) Subject to the terms and
conditions set forth herein, from and after the Closing, the Seller covenants
and agrees to defend, indemnify and hold harmless each of the Buyer, its
Affiliates, the members of the Company Group and their respective officers,
directors, employees, agents, advisers and representatives (collectively, the
"Buyer Indemnitees") from and against, and pay or reimburse the Buyer
Indemnitees for, any and all claims, demands, liabilities, obligations, losses,
fines, costs, expenses, royalties, Litigation, deficiencies or damages (whether
absolute, accrued, conditional or otherwise and whether or not resulting from
third party claims), including interest and penalties with respect thereto and
out-of-pocket expenses and reasonable attorneys' and accountants' fees and
expenses incurred in the investigation or defense of any of the same or in
asserting, preserving or enforcing any of their respective rights hereunder or
under any Transaction Agreement but excluding incidental, indirect or
consequential damages and damages for lost profits (collectively, "Losses"),
resulting from or arising out of:
(i) any breach of any representation or warranty when made or deemed
made by any member of the Selling Group herein or in connection herewith
(other than the representations and warranties set forth in Section 2.9
and other than, in the case of the representations and warranties in
Section 2.20(f), in connection with the termination by the Buyer of the
Allied Retirement Plan);
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(ii) any failure of any member of the Selling Group to perform any
covenant or agreement hereunder or under the U.K. Property Agreement, the
Pensions Agreement or the Transition Services Agreement or fulfill any
other obligation in respect hereof or thereof;
(iii) until March 31, 2002 (the "Special Indemnity Period"), any
Third Party Proceeding (whether based on contract, tort, the alleged
violation of any Law (including any Environmental Law), or any acts or
omissions by any member of the Selling Group or the Company Group or by
any of their respective directors, officer, employees, contractors,
licensees, lessees or agents), which, and only to the extent that it,
arose or arises out of or occurred as a result of (or which is based upon
or results from) events that occurred or conditions that existed or the
ownership of the Target Stock, the U.K. Shares or the Canada Assets or the
operation of the Moving Business (including any businesses disposed of or
discontinued) on or prior to the Closing Date other than any Loss
resulting from or arising out of (x) liabilities disclosed in the Seller
Disclosure Letter (other than Litigation), (y) ordinary course operating
liabilities of the kind that are recorded on the Closing Balance Sheet as
current liabilities and (z) all pending Litigation (including insurance
claims) that is disclosed in Section 2.15 of the Seller Disclosure Letter
and all other pending Litigation (i.e., claims with costs reasonably
expected to be less than $100,000 not required to be disclosed in Section
2.15 of the Seller Disclosure Letter) (the Litigation described in this
clause (z), the "Reserved Litigation");
(iv) the Excluded Canada Liabilities;
(v) the Restructuring Transactions; and
(vi) the failure of any Computer System operated by Allied Van
Lines, Inc. or its Subsidiaries to be Year 2000 Compatible.
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(b) For purposes of this Section 11.1, any inaccuracy in any
representation or warranty shall be determined without regard to any materiality
or Material Adverse Effect qualification.
(c) Except for Losses resulting from inaccuracies in the representations
and warranties contained in Sections 2.1, 2.3 and 2.26, the Seller shall not be
required to indemnify the Buyer Indemnitees with respect to any claim for
indemnification pursuant to clause (i) of Section 11.1(a) in respect of any
Losses resulting from inaccuracies in the representations and warranties of any
member of the Selling Group referred to in such clause, (x) unless and until the
amount of any claim gives rise to Losses in excess of $25,000 and (y) unless and
until the aggregate amount of all claims against the Seller under this Section
11.1 exceeds $4,000,000, but in such event indemnification shall be made by the
Seller for the full amount of all claims against the Seller, provided, however,
that (A) the aggregate liability of the Seller to the Buyer with respect to all
claims for indemnification under clauses (i) and (iii) of Section 11.1(a) shall
not exceed $200,000,000 and (B) the Buyer shall not be entitled to
indemnification for any Loss if and to the extent that such Loss is
(1) reflected as a liability on the Closing Balance Sheet and (2) included in
the definition of Closing Controllable Net Assets. In addition, the Seller shall
not be required to indemnify the Buyer Indemnitees with respect to any claim for
indemnification for Reserved Litigation until the aggregate amount of all Losses
incurred by the Buyer Indemnitees in respect of such Reserved Litigation exceeds
the aggregate amount of reserves on the Closing Balance Sheet for such Reserved
Litigation.
11.2. Indemnification by the Buyer. (a) The Buyer covenants and agrees to
defend, indemnify and hold harmless the Seller from and against any and all
Losses resulting from or arising out of (i) any breach in any representation or
warranty made by the Buyer herein or in connection herewith; or (ii) any failure
of the Buyer to perform any
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covenant or agreement hereunder or under the U.K. Property Agreement, the
Pensions Agreement or the Transition Services Agreement or fulfill any other
obligation in respect hereof or thereof.
(b) Except for Losses resulting from inaccuracies in the representations
and warranties contained in Section 3.1 and 3.11, the Buyer shall not be
required to indemnify the Seller with respect to any claim for indemnification
pursuant to clause (i) of Section 11.2(a) in respect of any Losses resulting
from inaccuracies in the representations and warranties of the Buyer referred to
in such clause, (x) unless and until the amount of any claim gives rise to
Losses in excess of $25,000 and (y) unless and until the aggregate amount of all
claims against the Buyer under this Section 11.2 exceeds $4,000,000, but in such
event indemnification shall be made by the Buyer for the full amount of all
claims against the Buyer, provided, however, that the aggregate liability of the
Buyer to the Seller with respect to all claims for indemnification under clause
(i) of Section 11.2(a) shall not exceed $200,000,000.
11.3. Payment Adjustments, etc. Any payments made pursuant to this Article
XI shall result in a corresponding adjustment to the allocation set forth in
Annex D.
11.4. Indemnification Procedures. (a) In the case of any claim asserted by
a third party against a party entitled to indemnification under this Agreement
(the "Indemnified Party"), notice shall be given by the Indemnified Party to
the party required to provide indemnification (the "Indemnifying Party")
promptly after such Indemnified Party has actual knowledge of any claim as to
which indemnity may be sought, and the Indemnified Party shall permit the
Indemnifying Party (at the expense of such Indemnifying Party) to assume at any
time the defense of any claim or any litigation resulting therefrom, provided,
that (i) counsel for the Indemnifying Party who shall conduct the defense of
such claim or litigation shall be reasonably satisfactory to the Indemnified
Party, and the Indemnified
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Party may participate in such defense at such Indemnified Party's expense
subject to the ultimate decision making authority and control of the
Indemnifying Party, and (ii) the failure of any Indemnified Party to give notice
as provided herein shall not relieve the Indemnifying Party of its
indemnification obligation under this Agreement except to the extent that such
failure materially prejudices the Indemnifying Party as a result of such failure
to give notice. Except with the prior written consent of the Indemnified Party,
no Indemnifying Party, in the defense of any such claim or litigation, shall
consent to entry of any judgment or enter into any settlement that provides for
injunctive or other nonmonetary relief affecting the Indemnified Party or that
does not include as an unconditional term thereof the giving by each claimant
or plaintiff to such Indemnified Party of a release from all liability with
respect to such claim or litigation. In the event that an actual or potential
conflict of interest exists between the Indemnifying Party and the Indemnified
Party (other than the mere existence of the Indemnifying Party's obligation to
indemnify the Indemnified Party pursuant to this Article XI) which would
reasonably be expected to materially impair the ability of the Indemnifying
Party to defend against such claim or prevent the fair representation of the
Indemnified Party, the Indemnified Party shall have the right at all times to
take over and assume control over the defense, settlement, negotiations or
litigation relating to any such claim at the sole cost of the Indemnifying
Party, provided, that if the Indemnified Party does so take over and assume
control, the Indemnified Party shall not settle such claim or litigation without
the written consent of the Indemnifying Party, such consent not to be
unreasonably withheld. In the event the Indemnified Party does so take over and
assume control of the defense, the Indemnified Party agrees reasonably to inform
the Indemnifying Party of the progress and of any developments related to such
claim or defense and to provide such materials and access to counsel as
reasonably requested by the Indemnifying Party. In the event that the
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Indemnifying Party does not accept the defense of any matter as above provided,
the Indemnified Party shall have the full right to defend against any such claim
or demand and to settle or agree to pay in full such claim or demand, and the
Indemnifying Party shall remain liable under this Article XI for the full amount
of such demand or claim and any Losses in connection therewith subject to the
limitations set forth in Section 11.1. In any event, the Seller and the Buyer
shall cooperate in the defense of any claim or litigation subject to the
provisions of Article XI and the records of each shall be available to the other
with respect to such defense.
(b) If an Indemnified Party receives, subsequent to its receipt of any
indemnification from an Indemnifying Party, an amount in respect of the Losses
for which it has received indemnification (the "Indemnified Losses") under
insurance coverage, then such Indemnified Party shall promptly reimburse the
Indemnifying Party for any indemnification payment made by such Indemnifying
Party up to such amount received under such insurance coverage. If any Losses
for which an Indemnifying Party is responsible or allegedly responsible pursuant
to Section 11.1 or 11.2 are recoverable or potentially recoverable under
insurance coverage at the time when payment is due hereunder, following payment
by the Indemnifying Party for such Losses, (a) the Indemnified Party shall
attempt in good faith to collect any and all such Losses under such insurance
coverage or (b) at the request of the Indemnifying Party, the Indemnified Party
shall assign any and all rights that it may have to recover such Losses to the
Indemnifying Party, or, if such rights are not assignable under applicable law
or otherwise, the Indemnified Party shall continue to attempt in good faith to
collect any and all such Losses under such insurance coverage for the benefit
of, and at the expense and direction of, the Indemnifying Party.
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11.5. Survival of Representations and Warranties, etc. All claims for
indemnification under clause (i) of Section 11.1(a) or clause (i) of Section
11.2(a) with respect to the representations and warranties contained herein must
be asserted on or prior to the date of the termination of the respective
survival periods set forth in this Section 11.5, and all claims for
indemnification under clause (iii) of Section 11.1(a) must be asserted on or
prior to the end of the Special Indemnity Period. The representations and
warranties contained in this Agreement shall survive the execution and delivery
of this Agreement, any examination by or on behalf of the parties hereto and the
completion of the transactions contemplated herein, but only to the extent
specified below:
(a) except as set forth in clause (b) below, the representations and
warranties contained in this Agreement shall survive until March 31, 2001;
(b) the representations and warranties of the Seller contained in
Sections 2.1, 2.3, 2.9, and 2.26 and of the Buyer contained in Sections
3.1 and 3.11 and shall survive without limitation (subject, in the case of
Section 2.9, to any statutes of limitations applicable to the particular
Tax at issue).
11.6. Limitations on Indemnification. No party to this Agreement, nor any
other Indemnified Party, shall seek or be entitled to incidental, indirect or
consequential damages or damages for lost profits in any claim for
indemnification under this Article XI.
11.7. Exclusive Remedy. Except for matters covered by the Tax Matters
Agreement (or Section 6.8) and for claims based on fraud or intentional
misrepresentation (including with respect to the matters set forth in Section
2.9), the Buyer and the Seller acknowledge and agree that the foregoing
indemnification provisions in this Article XI shall be the sole and exclusive
remedy of the Buyer and the Seller with respect to the transactions contemplated
by this Agreement. The Tax Matters Agreement shall be the sole and exclusive
remedy of the Buyer and the Seller with respect to the matters covered
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therein (except to the extent inconsistent with the Pensions Agreement in which
case the terms of the Pensions Agreement shall control and except to the extent
inconsistent with paragraph 11 of the U.K. Property Agreement in which case
paragraph 11 of the U.K. Property Agreement shall control). The Buyer and the
Seller acknowledge and agree that the foregoing indemnification provisions in
this Article XI (other than this Section 11.7) shall not apply in the case of a
breach of a representation or warranty set forth in Section 2.9.
11.8. Entities Making Payments. Notwithstanding any other provision of
this Article XI, in the case of any payment required to be made between the
Seller and the Buyer under this Article XI in respect of a particular member of
the Company Group, the payment shall be made between the relevant Selling
Subsidiary that (directly or indirectly) disposed of such member and the
relevant Buyer Subsidiary that (directly or indirectly) acquired such member. In
the case of any payment made under this Article XI in respect of the Canada
Assets, the payment shall be made between the Selling Canada Subsidiary and the
Buyer Subsidiary that purchased the Canada Assets. In the case of any payment
made under this Article XI in respect of the U.K. Target Subsidiary or any of
its Subsidiaries, the payment shall be made between Realcause Ltd. and the
relevant Buyer Subsidiary that subscribed for the U.K. Shares.
ARTICLE XII
Definitions
12.1. Terms Generally. The words "hereby", "herein", "hereof", "hereunder"
and words of similar import refer to this Agreement as a whole (including any
Exhibits, Annexes and hereto, the Seller Disclosure Letter and the Buyer
Disclosure Letter) and not merely to the specific section, paragraph or clause
in which such word appears. All references herein to Articles, Sections,
Exhibits and Schedules shall be deemed references
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to Articles and Sections of, and Exhibits and Schedules to, this Agreement
unless the context shall otherwise require. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation."
The definitions given for terms in this Article XII and elsewhere in this
Agreement shall apply equally to both the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. Except as otherwise
expressly provided herein, all references to "dollars" or "$" shall be deemed
references to the lawful money of the United States of America.
12.2. Certain Terms. Whenever used in this Agreement (including in the
Seller Disclosure Letter), the following terms shall have the respective
meanings given to them below or in the Sections indicated below:
Accountant: as defined in Section 1.3(b).
Acquisition: as defined in the preamble to this Agreement.
Acquisition Proposal: any bona fide offer, proposal or other
indication of interest from a third party regarding any of the following
(other than the transaction provided for in this Agreement involving the
Moving Business and other than in connection with any internal
restructuring within the Seller's company group): (i) any merger,
consolidation, share exchange, recapitalization, business combination or
other similar transaction involving any Subsidiary of the Seller involved
in the Moving Business and any third party; (ii) any sale, lease,
exchange, mortgage, pledge, transfer or other disposition of (x) any
equity securities of any Subsidiary of the Seller engaged in the Moving
Business or (y) a material portion of the assets of any Subsidiary of the
Seller involved in the Moving Business, taken as a whole, in a single
transaction or series of related transactions; or (iii) any public
announcement of a proposal, plan or intention to do any of the foregoing
or any agreement to engage in any of the foregoing.
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Adjustment Certificate: as defined in Section 1.3(a).
Adjustment Report: as defined in Section 1.3(c).
Affiliate: of a Person means a Person that directly or indirectly
through one or more intermediaries, controls, is controlled by, or is
under common control with, the first Person, including but not limited to
a Subsidiary of the first Person, a Person of which the first Person is a
Subsidiary, or another Subsidiary of a Person of which the first Person is
also a Subsidiary. "Control" (including the terms "controlled by" and
"under common control with") means the possession, directly or indirectly,
of the power to direct or cause the direction of the management policies
of a person, whether through the ownership of voting securities, by
contract or credit arrangement, as trustee or executor, or otherwise.
Agent: any local moving and storage company that provides customers
with the sales, packing, warehousing, a portion of the hauling required or
other similar services to support the international or domestic moving
services of the Company Group.
Agreement: this Acquisition Agreement, including the Exhibits,
Annexes, Seller Disclosure Letter and Buyer Disclosure Letter hereto.
Amendment No. 1 to the Registration and Participation Agreement: the
amendment to the Registration Agreement to be entered by the Seller, the
Buyer and Clayton, Dubilier & Rice Fund V Limited Partnership on the
Closing Date, in the form attached hereto as Exhibit D.
Ancillary Agreements: the Warrant, NFC Letter Agreement, Amendment
No. 1 to the Registration and Participation Agreement, Transition Services
Agreement, Tax Matters Agreement, Pensions Agreement, and the U.K.
Property Agreement.
Antitrust Division: the Antitrust Division of the United States
Department of Justice.
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Assets: as defined in Section 2.10.
Audited Financial Statements: the audited consolidated financial
statements of the Company Group as at and for the years ended September
30, 1996, September 30, 1997 and September 30, 1998, together with audit
reports on such year-end statements by Ernst & Young, the Company Group's
independent public accountants, including in each case combined balance
sheets, combined profit and loss accounts, combined statements of total
recognized gains and losses, combined cash flow statements and combined
statements of changes in NFC Group Investment, and accompanying notes.
Authorized Representative: means any moving and storage company that
provides customers with sales, warehousing, storage or moving services
within the international network of representatives established by the
Company Group.
Business Price: as defined in Section 4.9(b).
Business Purchase Right: as defined in Section 4.9(b).
Business Terms: as defined in Section 4.9(b).
Buyer: as defined in the preamble to this Agreement.
Buyer Common Stock: as defined in Section 1.1(d).
Buyer Disclosure Letter: the disclosure letter, delivered to the
Seller by the Buyer, dated September 14, 1999.
Buyer Financial Statements: the consolidated financial statements of
the Buyer as of March 28, 1998 and for the period December 28, 1997
through March 28, 1998 and the consolidated financial statements of the
Buyer and its Subsidiaries as of December 26, 1998 and March 29, 1998 and
for the period March 29, 1998 (inception) through December 26, 1998,
together with reports on such year-end statements by
PricewaterhouseCoopers LLP, the Buyer's independent public accountants,
and
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the unaudited consolidated financial statements of the Buyer as at and for
the six-month period ended June 30, 1999, including in each case, a
balance sheet, a statement of income, a statement of changes in
stockholder's equity and statement of cash flows, and accompanying notes,
together with a review report on such interim statements by
PricewaterhouseCoopers LLP, the Buyer's independent public accountants.
Buyer Indemnitees: as defined in Section 11.1.
Buyer Information: as defined in Section 6.3(b).
Buyer Material Adverse Effect: means (a) any event, occurrence, fact
or change that, individually or in the aggregate, is or would reasonably
be expected to become, within a reasonable period of time, materially
adverse to the business, operations, assets, liabilities, or results of
operations of the Buying Group taken as a whole as existing or conducted
by the Buying Group as of the date hereof or as of the Closing Date, as
the case may be (including any event, occurrence, fact or change resulting
from major economic recession, war or other major global turmoil),
provided, however, that any adverse change in the U.S. or global financial
or capital markets shall not alone constitute a Buyer Material Adverse
Effect or (b) the material impairment of the ability of the Buying Group
to perform their respective obligations hereunder or under any of the
Transaction Agreements.
Buyer Monthly Unaudited Financial Information: as defined in Section
5.5.
Buyer Parties: as defined in Section 6.3(b).
Buyer Representatives: as defined in Section 6.3(b).
Buyer's Knowledge or Knowledge of the Buyer: the actual knowledge of
R. Barry Uber, Jeffrey Kaczka, Don Saulic, Ralph Ford, Gerald Burns,
Ronald
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Milewski, Peter Schleicher, Kevin J. Conway, David A. Novak, James W.
Rogers, Charles P. Pieper, Michael G. Babiarz and Cheryl M. Kozlowski.
Buying Group: as defined in the preamble to this Agreement.
Buying Subsidiaries: as defined in the preamble to this Agreement.
Canada Assets: collectively, all right, title and interest of the
Seller and the Selling Group in and to all the properties, assets and
rights of every nature, kind and description, tangible and intangible
(including goodwill), whether real, personal or mixed, whether accrued,
contingent or otherwise and whether now existing or hereinafter acquired
(other than the Excluded Canada Assets) primarily relating to or used
primarily or held for use in connection with the Moving Business as
conducted or located in Canada as the same may exist on the Closing Date,
including, without limitation, all such assets, properties and rights
included in the September 1998 Balance Sheet.
Canada Liabilities: the following liabilities relating to the Canada
Assets and existing at or arising on or after the Closing Date: (i) any
trade accounts payable incurred in the ordinary course of business
consistent with prior practice and other ordinary course operating
liabilities of the Moving Business as conducted in Canada of the kind that
are recorded on the combined balance sheet of the Moving Business as
current liabilities; (ii) any and all liabilities, obligations and
commitments arising out of the agreements, contracts and commitments set
forth on the Section 2.12(a) of the Seller Disclosure Letter (or not
required to be set forth therein because of the amount involved), but not
including any obligation or liability for any breach thereof occurring
prior to the Closing Date; and (iii) liabilities in respect of Canada
Transferred Employees to the extent specifically assumed by the Buyer
pursuant to Section 6.6(c).
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Cash Purchase Price: as defined in Section 1.1(g).
Category 2 Leases: as defined in the U.K. Property Agreement.
CERCLA: the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, 42 U.S.C. ss. 9601 et seq.
Circular: as defined in Section 4.8(a).
Closing: as defined in Section 1.1.
Closing Balance Sheet: the audited consolidated balance sheet of the
Company Group as of the Closing Date, which shall (a) have been audited in
accordance with U.K. generally accepted auditing standards by the Seller
Accountants, (b) fairly present the financial position of the Company
Group as at the close of business on the Closing Date (without giving
effect to the sale and purchase of the Target Stock or the Canada Assets
or the assumption of the Canada Liabilities or the issuance of the U.K.
Shares or any subsequent transaction contemplated hereby or by any of the
Ancillary Agreements), (c) be prepared in accordance with U.K. GAAP
applied on a basis consistent with the preparation of the September 1998
Balance Sheet subject to the changes necessary to comply with FRS 10 and
12 and (d) include line items substantially consistent with those in the
September 1998 Balance Sheet, provided, that the Closing Balance Sheet
shall reflect (i) accruals, pro rated for the portion of the 2000 fiscal
year of the Company Group ended on the Closing Date, for all year-end
adjustments that would be reflected in the audited consolidated balance
sheet of the Company Group as of the end of such fiscal year and (ii) a
specified amount for the aggregate reserve for Reserved Litigation. Each
accounting term used herein shall have the meaning that is applied thereto
in accordance with U.K. GAAP and each account included in the Closing
Balance Sheet shall be calculated in accordance with U.K. GAAP and shall
be consistent with the books and records of the Company
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Group. With respect to the calculation of the levels of the accounts set
forth above, no change in accounting principles, other than changes
necessary to comply with FRS 10 and 12, shall be made from those utilized
in preparing the Audited Financial Statements (without regard to
materiality), including, without limitation, with respect to the nature or
classification of accounts, closing proceedings, levels of reserves or
levels of accruals. For purposes of the preceding sentence, "changes in
accounting principles" includes all changes in accounting principles,
policies, practices, procedures or methodologies with respect to financial
statements, their classification or their display, as well as all changes
in practices, methods, conventions or assumptions utilized in making
accounting estimates.
Closing Controllable Net Assets: as set forth on the Closing Balance
Sheet, an amount equal to the net assets of the Company Group, excluding
all Tax balances and NFC Group balances as determined in a manner shown on
the Statement of Pro Forma Purchase Price Adjustment attached hereto as
Annex G; provided, that with respect to Controllable Net Assets determined
as of the close of business on the Closing Date, the amount of trade
debtor assets on the Closing Balance Sheet shall be decreased by
(pound)0.8 million or such lesser amount as remains uncollectible at
Closing from Vanguard trade debtors.
Closing Date: as defined in Section 1.2.
Code: the Internal Revenue Code of 1986, as amended, and the
regulations and rules promulgated thereunder.
Common Shares: as defined in Section 1.1(d).
Common Stock Certificate: as defined in Section 1.1(d).
Company Actuarial Analysis: as defined in Section 2.16(e).
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Company Group: collectively, the Target Subsidiaries, all
Subsidiaries of the Target Subsidiaries, Allied Pickfords LLC (UAE) and
A.L. Movers Private Limited, the Canada Assets and the Canada Liabilities.
Company Intellectual Property: as defined in Section 2.13(b).
Computer Systems: with respect to any Person, any and all
(i) computer software programs, (ii) semiconductor chips,
(iii) microprocessors, (iv) embedded microcontrollers and (v) other
hardware or other equipment containing programming instructions of any
kind, in each case whether owned or licensed or otherwise held by such
Person for use.
Confidential Buyer Information: as defined in Section 6.3(a).
Confidential Seller Information: as defined in Section 6.3(b).
Confidentiality Agreement: as defined in Section 6.3(a).
Consent: any consent, approval, waiver, certificate, exemption,
registration, declaration, filing, report or notice of, with or to any
Person, including any Governmental Authority.
Contract: all loan agreements, indentures, letters of credit
(including related letter of credit applications and reimbursement
obligations), mortgages, security agreements, pledge agreements, deeds of
trust, bonds, notes, guarantees, surety obligations, warranties, licenses,
franchises, permits, powers of attorney, purchase orders, leases, and
other agreements, contracts, instruments, obligations, offers,
commitments, arrangements and understandings, written or oral, to which
any member of the Company Group is a party or by which it or any of its
properties or assets may be bound or affected, in each case as amended,
supplemented, waived or otherwise modified, but expressly excluding the
Leases.
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Designated Target: (i) each of the following Target Subsidiaries
(unless the Buyer provides written notice to the Seller at least two weeks
prior to the Closing that such Target Subsidiary shall not constitute a
Designated Target) Pickfords Ltd, A&N Removals Ltd., Arthur Pierre (UK)
Ltd., Bullens Ltd, GB Crate Hire Ltd, Hoults Removals Ltd., NFC Moving
Services Ltd., Pitt & Scott Ltd, Allied Pickfords Ltd, Pickfords Manhire
Ltd., Irish Security Archives Ltd (NI), Moving Services Property Ltd,
Irish Security Archives Ltd (Ire), Allied Pickfords Ltd (Ire), and
(ii) any other Target Subsidiary (other than Allied Van Lines Inc. and its
subsidiaries) designated by the Buyer in writing no later than one week
prior to the Closing Date and consented to by the Seller (such consent not
to be unreasonably withheld).
Dispute Notice: as defined in Section 1.3(a).
Environmental Laws: all Laws relating to the protection of the
environment, natural resources or human health and safety, including,
without limitation, (a) CERCLA, the Resource Conservation and Recovery
Act, and the Occupational Safety and Health Act, (b) all other legally
binding requirements pertaining to reporting, licensing, permitting,
investigation or remediation of emissions, discharges, releases or
threatened releases of Hazardous Materials into the air, surface water,
groundwater or land, or relating to the manufacture, processing,
distribution, use, sale, treatment, receipt, storage, disposal, transport
or handling of Hazardous Materials, and (c) all other legally binding
requirements pertaining to the protection of the health and safety of
employees.
Environmental Permits: all Permits, authorizations, consents, and
monies required pursuant to applicable Environmental Laws or relating to
the use, generation, management, handling, transport, treatment,
disposal, storage or release of Hazardous Materials.
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ERISA: the Employee Retirement Income Security Act of 1974, as
amended.
Excluded Canada Assets: collectively, the assets listed on Section
12.2 of the Seller Disclosure Letter.
Excluded Canada Liabilities: any (x) liabilities, obligations or
commitments other than the Canada Liabilities of any member of the Selling
Group relating to or arising out of the operation of the Moving Business
as conducted or located in Canada or the ownership of the Canada Assets
prior to the Closing and (y) all liabilities, obligations or commitments
relating to Taxes relating to or arising out of the operation of the
Moving Business as conducted or located in Canada on or prior to the
Closing Date.
Excluded Software: as defined in Section 2.13(b).
Exercise Period: as defined in Section 4.9(b).
Financing Letters: as defined in Section 3.14.
FRS: as defined in Section 1.3(a).
FTC: the United States Federal Trade Commission.
Governmental Authority: any nation or government, any state or other
political subdivision thereof; any entity, authority or body exercising
executive, legislative, judicial, regulatory or administrative functions
of or pertaining to government, including, without limitation, any
government authority, agency, department, board, commission or
instrumentality of any nation or government or any state or other
political subdivision thereof; any court, tribunal or arbitrator; and any
self-regulatory organization.
Hazardous Materials: any substance that: (a) is or contains
asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls,
petroleum or petroleum-derived substances or wastes, radon gas or related
materials (b) requires investigation, removal or remediation under any
Environmental Law, or is defined, listed or identi-
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fied as a "hazardous waste" or "hazardous substance" thereunder, or (c) is
toxic, explosive, corrosive, flammable, infectious, radioactive,
carcinogenic, mutagenic, or otherwise hazardous and is regulated by any
Governmental Authority or Environmental Law.
HSR Act: the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended, and the rules and regulations thereunder.
ICTA 1988: the U.K. Income and Corporations Taxes Act 1988.
Income Tax: any Tax computed in whole or in part based on or by
reference to net income and any alternative, minimum, accumulated earnings
or personal holding company Tax (including all interest and penalties
thereon and additions thereto).
Indebtedness: as applied to any Person, means, without duplication,
(a) all indebtedness for borrowed money, (b) all obligations evidenced by
a note, bond, debenture, letter of credit, draft or similar instrument,
(c) that portion of obligations with respect to capital leases that is
properly classified as a liability on a balance sheet in conformity with
the applicable generally accepted accounting principles, (d) notes payable
and drafts accepted representing extensions of credit, (e) any obligation
owed for all or any part of the deferred purchase price of property or
services, which purchase price is due more than six months from the date
of incurrence of the obligation in respect thereof, and (f) all
indebtedness and obligations of the types described in the foregoing
clauses (a) through (e) to the extent secured by any Lien on any property
or asset owned or held by that Person regardless of whether the
indebtedness secured thereby shall have been assumed by that Person or is
nonrecourse to the credit of that Person.
Indemnified Losses: as defined in Section 11.4(b).
Indemnified Party: as defined in Section 11.4(a).
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Indemnifying Party: as defined in Section 11.4(a).
Insurance Companies: TransGuard Insurance Company of America Inc.,
Claimguard Inc., Vanguard Insurance Agency Inc., TransGuard General Agency
Inc. and The Baxendale Insurance Company Ltd.
Insurance Contracts: as defined in Section 2.16(e).
Insurance Department Approvals: the Consents required to be made or
obtained by any member of the Selling Group or the Company Group or the
Buyer and its Subsidiaries in connection with the transactions
contemplated hereby and under the Transaction Agreements with the
appropriate insurance regulatory Governmental Authority in the
jurisdictions of Illinois, Indiana and Ireland.
Insurance Laws: as defined in Section 2.16(e).
Insurance Licenses: as defined in Section 2.16(e).
Insurance Subsidiaries: as defined in Section 2.1(d).
Insured Claim: as defined in Section 4.13.
Intellectual Property: United States and foreign trademarks, service
marks, trade names, trade dress, domain names and copyrights, including
registrations and applications to register or renew the registration of
any of the foregoing; United States and foreign letters patent and patent
applications; and inventions, processes, designs, formulae, trade secrets,
know-how, confidential information, database rights, Software, firmware
and Internet Web sites; all intellectual property rights similar to the
foregoing; and tangible embodiments of any of the foregoing (in any medium
including electronic media).
June 1999 Financial Statements: as defined in Section 4.10.
Junior Preferred Stock: as defined in Section 1.1(e).
Junior Preferred Stock Certificate: as defined in Section 1.1(e).
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Key Employee: as defined in Section 4.9(b).
Law: all applicable provisions of all (a) constitutions, treaties,
statutes, laws (including the common law), codes, rules, regulations,
ordinances or orders of any Governmental Authority, (b) Consents of any
Governmental Authority and (c) orders, decisions, injunctions, judgments,
awards and decrees of or agreements with any Governmental Authority.
Leased Real Property: all real property leased, subleased, licensed
or otherwise used or occupied pursuant to the Leases.
Leases: all leases, subleases, licenses and occupancy agreements
pursuant to which any member of the Selling Group or the Company Group is
the lessee, sublessee, licensee, user or occupant of real property used in
or held for use in connection with, necessary for the conduct of, or
otherwise material to, the Moving Business.
Letter Agreements: (i) the letter agreement, dated the date hereof,
between the Buyer and the Seller regarding certain fees; (ii) the letter
agreement, dated the date hereof, between the Buyer and the Seller
regarding certain matters referenced in Section 2.11(a)(ii) of the Seller
Disclosure Letter; (iii) the letter agreement, dated the date hereof,
between the Buyer and the Seller regarding the Naperville License;
(iv) the letter agreement, dated the date hereof, between the Buyer and
the Seller relating to Transfer Taxes; and (v) the Outsourced Accounting
Services Agreement, dated the date hereof, among the Seller, the Buyer and
Pickfords Limited.
Lien: any mortgage, pledge, deed of trust, hypothecation, right of
others, claim, security interest, encumbrance, burden, title defect, title
retention agreement, lease, sublease, license, occupancy agreement,
easement, covenant, condition, encroachment, voting trust agreement,
interest, option, right of first offer, negotiation or
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refusal, proxy, lien, charge or other restrictions or limitations of any
nature whatsoever, including but not limited to such Liens as may arise
under any Contract.
Litigation: any action, cause of action, claim, demand, suit,
proceeding, citation, summons, subpoena, or to the Knowledge of the Seller
or the Buyer, as the case may be, inquiry or investigation, of any nature,
civil, criminal, regulatory, environmental or otherwise, in law or in
equity, or pending or, to the Knowledge of the Seller or the Buyer, as the
case may be, threatened, by or before any court, tribunal, arbitrator or
other Governmental Authority.
Logistics Business: as defined in Section 4.9(a)(iv).
Losses: as defined in Section 11.1.
Management Reports: as defined in Section 2.6(c).
Marked Materials: as defined in Section 6.2.
Master Agreement Customers: Middlesex Hospital currently located in
London, England and the British Foreign Office.
Material Adverse Effect: means (a) any event, occurrence, fact or
change that, individually or in the aggregate, is or would reasonably be
expected to become, within a reasonable period of time, materially adverse
to the business, operations, assets, liabilities, or results of operations
of the Company Group taken as a whole as existing or conducted by the
Selling Group or the Company Group as of the date hereof, or as of the
Closing Date, as the case may be (including, any event, occurrence, fact
or change resulting from major economic recession, war or other major
global turmoil), provided, however, that any adverse change in the U.S. or
global financial or capital markets shall not alone constitute a Material
Adverse Effect or (b) the material impairment of the ability of the
Selling Group or the Company Group to perform their respective obligations
hereunder or under any of the Transaction Agreements.
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Material Contract: as defined in Section 2.12(a).
Material Consents: as defined in Section 2.16(c).
Monthly Combining Profit and Loss Statement: as defined in Section
2.6(c).
Monthly Unaudited Financial Information: as defined in Section 4.4.
Moving Business: as defined in Section 4.9(a)(ii).
NA Holding Plan: as defined in Section 3.2(a).
Naperville Guarantor: NFC p.l.c. (f/k/a National Freight Consortium
p.l.c.), and any successor or assignee guarantor which is a member of the
Selling Group.
Naperville Guaranty: that certain guaranty made by the Naperville
Guarantor pursuant to the Naperville Lease.
Naperville Lease: that certain Office lease, dated June 30, 1988,
between LaSalle National Bank, not individually but as Trustee under a
Trust Agreement dated November 2, 1985, and known as Trust No. 110610, as
landlord, and Allied Van Lines, Inc., a Delaware corporation, as tenant,
for the premises located at 300 Park Plaza, Naperville, Illinois.
Naperville Tenant: Allied Van Lines, Inc., a Delaware corporation.
New Lease Property: means the properties that will be leased,
subleased or licensed to or from a member of the Company Group pursuant to
the U.K. Property Agreement.
NFC Letter Agreement: the letter agreement, to be entered into by
the Seller and the Buyer on the Closing Date, in the form attached hereto
as Exhibit F.
1993 Act: the U.K. Pension Schemes Act 1993.
Non-Company Affiliate: any Affiliate of the Seller other than the
Company Group.
Non-Compete Period: as defined in Section 4.10.
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Non-U.S. Plan: any Plan other than (i) a U.S. Plan and (ii) the
Seller's Schemes.
Options: as defined in Section 3.2(a).
ordinary course of business: the usual, regular and ordinary course
of business of the Company Group or the Buying Group, as the case may be,
consistent with the past custom and practice thereof.
Organizational Documents: as to any Person, its certificate or
articles of incorporation, by-laws and other organizational documents.
Other Antitrust Approvals: Approvals from Governmental Authorities
in Germany and Australia.
Owned Intellectual Property: as defined in Section 2.13(a).
Owned Real Property: the real property owned as a freehold as
opposed to a leasehold by any member of the Company Group, together with
all structures, facilities, improvements, fixtures, systems, equipment and
items of property presently or hereafter located thereon or attached or
appurtenant thereto, or owned by any member of the Company Group and
located on Leased Real Property, and all easements, licenses, rights and
appurtenances relating to the foregoing.
Owner Operators: independent contractors who drive a truck that is
leased exclusively to any member of the Company Group.
PBGC: as defined in Section 2.20(c).
Pensions Agreement: the Pensions Agreement and Actuary's Letter for
NFC Retirement Plan and Supplementary Pension Scheme, in each case, dated
as of the date hereof, attached hereto as Exhibit I.
Permits: collectively, certificates, permits, licenses, consents,
authorizations and other approvals of any Governmental Authority or other
Person necessary to conduct
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the Moving Business of the Company Group as currently conducted (other
than Environmental Permits).
Permitted Liens: (a) Liens reserved against in the Unaudited Balance
Sheet to the extent so reserved, (b) Liens for Taxes not yet due and
payable or which are being contested in good faith and by appropriate
proceedings if adequate reserves with respect thereto are maintained on
the Company Group's books in accordance with U.K. GAAP, (c) those Liens
that are set forth in Section 2.11 of the Seller Disclosure Letter,
(d) mechanics liens and similar liens for labor, materials or supplies
provided with respect to any Real Property incurred in the ordinary course
of business for amounts which are not delinquent and which would not,
individually or in the aggregate, have a Material Adverse Effect on the
Moving Business or which are being contested in good faith by appropriate
proceedings if adequate reserves with respect thereto are maintained on
the Company Group's books in accordance with U.K. GAAP, (e) zoning,
building codes and other land use laws regulating the use or occupancy of
such Real Property or the activities conducted thereon which are imposed
by any governmental authority which are not violated by the current use or
occupancy of such Real Property or the operation of the Moving Business
thereon, or (f) Liens, individually and in the aggregate with all other
Permitted Liens that do not and will not materially detract from the value
of any of the property or assets of any member of the Company Group, or
materially interfere with the use thereof as currently used.
Person: any natural person, firm, partnership, association,
corporation, company, trust, business trust, Governmental Authority or
other entity.
Plan: each "employee benefit plan," within the meaning of Section
3(3) of ERISA (whether or not subject to ERISA) and each bonus, deferred
compensation,
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incentive compensation, stock purchase, stock option or other equity
based, severance, termination, change in control, retention, employment,
hospitalization or other medical, life or insurance, disability, other
welfare, supplemental unemployment benefits, profit-sharing, pension, or
retirement plan, program, agreement or arrangement, and each other
material employee compensation or benefit plan, program, agreement or
arrangement, sponsored, maintained or contributed to by any member of the
Selling Group or by any trade or business thereof, whether or not
incorporated, for the benefit of any employee, former employee, director
or former director of or any member of the Company Group or with respect
to which any member of the Company Group has or could reasonably be
expected to have any material liability.
Preferred Stock Certificate: as defined in Section 1.1(e).
Purchase Notice: as defined in Section 4.9(b).
Real Property: the Owned Real Property and the Leased Real Property.
Registration and Participation Agreement: the Registration and
Participation Agreement, dated March 30, 1998, between the Buyer and
Clayton, Dubilier and Rice Fund V Limited Partnership, as amended.
Related Persons: any member of the Company Group or any other trade
or business, whether or not incorporated, which, together with the Seller
or any member of the Company Group, is or would have been at any date of
determination occurring within the preceding six years, treated as a
single employer under Section 414 of the Code.
Release: any releasing, disposing, discharging, injecting, spilling,
leaking, leaching, pumping, dumping, emitting, escaping, emptying,
seeping, dispersal, leeching, migration, transporting, placing and the
like, including without limitation, the moving
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of any materials through, into or upon, any land, soil, surface water,
ground water or air, or otherwise entering into the environment.
Remedial Action: all actions required to (i) clean up, remove, treat
or in any other way remediate any Hazardous Materials; (ii) prevent the
release of Hazardous Materials; so that they do not migrate or endanger or
threaten to endanger public health or welfare or the environment; or
(iii) perform studies, investigations and care related to any such
Hazardous Materials.
Representatives: as to any Person, its accountants, counsel,
consultants (including actuarial, environmental and industry consultants),
officers, directors, employees, agents and other advisors and
representatives.
Reserved Litigation: as defined in Section 11.1(a)(iii).
Restructuring Transactions: (i) any of the transactions described on
Annex H , (ii) the settlement of any intercompany accounts of the Selling
Group or the Company Group pursuant to Section 4.16 and (iii) any other
transaction, agreement, arrangement or understanding (including any
hedging arrangement) relating to either clause (i) or (ii).
Retained Employee: any employee of the Selling Group following the
Closing Date.
Review Period: as defined in Section 1.3(a).
Rights: as defined in Section 4.6.
SAP: as defined in Section 2.6(e).
SAP Statements: as defined in Section 2.6(f).
Securities Act: the Securities Act of 1933, as amended.
Seller: as defined in the preamble to this Agreement.
Seller Accountants: the Seller's independent public accountants,
Ernst & Young.
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Seller Acquisition Proposal: any bona fide offer, proposal or other
indication of interest from a third party regarding any of the following
(other than the transactions provided for in this Agreement involving the
Moving Business and other than in connection with any internal
restructuring within the Seller's company group): (i) any merger,
consolidation, share exchange, recapitalization, business combination or
other similar transaction of the Seller involving any third party;
(ii) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition of (x) any equity securities representing more than 50% of the
voting power represented by the Seller's capital stock of the Seller or
(y) all or substantially all of the assets of the Seller, taken as a
whole, in a single transaction or series of related transactions; or
(iii) any public announcement of a proposal, plan or intention to do any
of the foregoing or any agreement to engage in any of the foregoing,
provided that any proposal to acquire the Logistics Business of the
Seller shall not constitute a Seller Acquisition Proposal.
Seller Disclosure Letter: the disclosure letter, delivered to the
Buyer by the Seller, dated September 14, 1999.
Seller Parties: as defined in Section 6.3(b).
Seller Representatives: as defined in Section 6.3(b).
Seller's Financial Advisors: as defined in Section 2.26.
Seller's Knowledge or to the Knowledge of the Seller: the actual
knowledge of David Buth, Kelvin Butler, Chris Denley, Ronan Dunne, Tim
Fallowfield, Michael Fergus, David Finch, Robert Lake, Jeremy Letchford,
Gerry Murphy, Julian Nicholls, Kevin Pickford, Ian Rogers, Tony Williams
and Barry Soloman.
Seller's Schemes: Collectively, (i) the NFC Retirement Plan
(established by a trust deed dated March 31, 1998), (ii) the NFC
Supplementary Pension Scheme
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(established by a trust deed dated February 11, 1972) and (iii) the NFC
Senior Staff Life Assurance Scheme (established by a trust deed dated
August 20, 1975).
Selling Canada Subsidiary: as defined in the preamble to this
Agreement.
Selling Group: the Seller and its Subsidiaries, other than the
Company Group.
Selling Subsidiaries: as defined in Annex A.
Seller Information: as defined in Section 6.3(b).
September 1998 Balance Sheet: the audited combined balance sheet of
the Company Group as of September 30, 1998, included in the Audited
Financial Statements.
Software: all computer software, including but not limited to,
application software and system software, including all source code and
object code versions thereof, in any and all forms and media, whether
recorded on paper, magnetic media or other electronic or non-electronic
media (including data and related documentation, user manuals, training
materials, flow charts, diagrams, descriptive tests and programs, computer
print-outs, underlying tapes, computer databases and similar items),
integrated circuits, embedded systems, and other electro-mechanical or
processor based systems.
Specified Freehold Property: the seven properties which are defined
as "Category 2 Freeholds" in the U.K. Property Agreement.
Stock Subscription Agreements: the stock subscription agreements
entered into from time to time between the Buyer and (i) certain members
of management of the Buyer and its Subsidiaries, (ii) certain
independently owned local moving and storage companies, partnerships or
other entities that have entered into agreements with the Buyer or its
Subsidiaries to provide sales, warehousing , packing and transportation
services and (iii) certain current or former chief executive officers of,
and consultants
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<PAGE>
to, other companies in which funds managed by Clayton, Dubilier & Rice,
Inc. have had investments, in each case relating to the purchase of shares
of Buyer Common Stock.
Subsidiaries: each corporation or other Person in which a Person
owns or controls, directly or indirectly, capital stock or other equity
interests representing more than 50% of the outstanding voting stock or
other equity interests.
Target Acquisition Proposal: any bona fide offer, proposal or other
indication of interest from a third party regarding any of the following
(other than the transaction contemplated by this Agreement and other than
in connection with any internal restructuring within the Buyer's company
group): (i) any merger, consolidation, share exchange, recapitalization,
business combination or other similar transaction involving the Moving
Business and any third party; (ii) any sale, lease, exchange, mortgage,
pledge, transfer or other disposition of (x) any equity securities of the
Moving Business or (y) a material portion of the assets of the Moving
Business, taken as a whole, in a single transaction or series of related
transactions; or (iii) any public announcement of a proposal, plan or
intention to do any of the foregoing or any agreement to engage in any of
the foregoing.
Target Stock: as defined in the preamble to this Agreement.
Target Subsidiaries: as defined in Annex B.
Tax: as defined in the Tax Matters Agreement.
Tax Return: as defined in the Tax Matters Agreement.
Tax Matters Agreement: the Tax Matters Agreement, dated the date
hereof, between the Buyer and the Seller.
Third Party Proceeding: any action, cause of action, claim, demand,
suit, proceeding, citation, summons or subpoena (other than arising from
any obligation
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<PAGE>
referred to in Section 5.3) by or before any court, tribunal, arbitrator
or other Governmental Authority initiated by any Person other than the
Buyer or its Affiliates.
Transaction Agreements: collectively, the Transfer Documents and the
Ancillary Agreements.
Transfer Documents: as defined in Section 1.2(a).
Transfer Taxes: any sales, excise, transfer, registration, stamp,
duty or other similar tax or fee imposed on any transaction effected
pursuant to Section 1.1.
Transferred Employees: as defined in Section 6.6(c).
Transition Services Agreement: the Transition Services Agreement to
be entered into by the Buyer and the Seller on the Closing Date, in the
form attached hereto as Exhibit C.
Treasury Regulations: as defined in the Tax Matters Agreement.
Unaudited Balance Sheet: the unaudited combined balance sheet of the
Company Group as at March 31, 1999, included in the Unaudited Financial
Statements.
Unaudited Financial Statements: the unaudited consolidated financial
statements of the Company Group as at and for the six-month period ended
March 31, 1999, including, in each case, a review report from Seller
Accountants and combined balance sheets, combined profit and loss
accounts, combined statements of total recognized gains and losses,
combined cash flow statements and combined statements of changes in NFC
Group Investment, and accompanying notes.
U.K. GAAP: as defined in Section 2.6(a).
U.K. Property Agreement: the U.K. Property Agreement, dated the date
hereof, between NFC U.K. Limited, Exel Logistics Property Limited,
National Carriers Limited, Tradeteam Limited and Pickfords Limited.
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<PAGE>
U.K. Shares: as defined in the preamble to this Agreement.
U.S. GAAP: as defined in Section 3.3(a).
U.S. Plan: any Plan that either (i) is subject to ERISA or (ii) is
maintained by any of the Seller's U.S. Subsidiaries.
Warrant: as defined in Section 1.1(f).
Year 2000 Compatible: (and variations thereof), with respect to any
Computer System, that such Computer System (i) is and will be able to
record, store, process and provide true and accurate dates and
calculations for dates and spans of dates, (ii) is and will be able to
operate normally before, during and after calendar year 2000 A.D.,
including, but not limited to, leap years, and (iii) shall not end
abnormally or provide invalid or incorrect results as a result of date
data which represents or references (or fails to represent or reference)
different centuries or more than one century.
Y2K Plan: as defined in Section 2.13(g).
ARTICLE XIII
Miscellaneous
13.1. Expenses. (a) Except as set forth below in this Section 13.1 or as
otherwise specifically provided for in this Agreement, the Seller, on the one
hand, and the Buyer, on the other hand, shall bear their respective expenses,
costs and fees (including attorneys', auditors' and financing commitment fees)
in connection with the transactions contemplated hereby, including the
preparation, execution and delivery of this Agreement and the Transaction
Agreements and compliance herewith, whether or not the transactions contemplated
hereby shall be consummated.
(b) The Selling Group, on the one hand, and the Buying Group and the
Company Group, on the other hand, shall each bear 50% of the Transfer Taxes.
Each
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<PAGE>
member of the Selling Group, the Buying Group and the Company Group shall
cooperate in connection with the payment of, and the filing of any Tax Returns
required in connection with, any Transfer Taxes and shall (if requested) provide
evidence of payment of any amounts that are claimed to have been paid. The
Seller shall cause the Selling Canada Subsidiary, and the Buyer will cause the
relevant Buying Subsidiary, to make a joint election under subsection 167(1) of
the Excise Tax Act (Canada), and, if applicable, each similar provision of each
Canadian provincial sales tax act, so that no Canadian federal goods and
services tax and no provincial sales tax shall be payable with respect to the
purchase and sale of the Canada Assets pursuant to this Agreement.
13.2. Notices. All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if (a) delivered
personally, (b) mailed, certified or registered mail with postage prepaid,
(c) sent by next-day or overnight mail or delivery or (d) sent by telecopy or
telegram with telephone confirmation to the receiving entity, as follows:
(i) if to the Buyer,
NA Holding Corporation
c/o North American Van Lines, Inc.
5001 U.S. Hwy 30 West
Fort Wayne, Indiana 46801
Fax: (219) 429-3135
Telephone: (219) 429-2511
Attention: General Counsel
with a copy to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Fax: (212) 909-6836
Telephone: (212) 909-6000
Attention: Paul S. Bird
137
<PAGE>
(ii) if to the Seller,
NFC plc
66 Chiltern Street
London WIM 2LT
England
Fax: (44 171) 224-2381
Telephone: (44 171) 317-0123
Attention: Jeremy Letchford
with copies to:
Kirkland & Ellis
Citicorp Center
153 East 53rd Street
New York, New York 10022
Fax: 212-446-4900
Tel: 212-446-4800
Attention: Kirk A. Radke
and
Ashurst Morris Crisp
Broadwalk House
5 Appold Street
London EC2A 2HA
Fax: (44-171) 972-7990
Tel: (44-171) 972-7710
Attention: Geoffrey Green
or, in each case, at such other address as may be specified in writing to the
other party hereto.
All such notices, requests, demands, waivers and other communications
shall be deemed to have been received (w) if by personal delivery on the day
after such delivery, (x) if by certified or registered mail, on the seventh
business day after the mailing thereof, (y) if by next-day or overnight mail or
delivery, on the day delivered, (z) if by telecopy or telegram, on the next day
following the day on which such telecopy or telegram was sent, provided that a
copy is also sent by certified or registered mail.
13.3. Governing Law, etc. THIS AGREEMENT SHALL BE GOVERNED IN ALL
RESPECTS, INCLUDING AS TO VALIDITY, INTERPRETATION AND
138
<PAGE>
EFFECT, BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
THE CONFLICT OF LAWS RULES THEREOF (OTHER THAN SECTION 5-1411 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK). The Buyer and the Seller hereby
irrevocably submit to the jurisdiction of the courts of the State of New York
and the Federal courts of the United States of America located in the State,
City and County of New York solely in respect of the interpretation and
enforcement of the provisions of this Agreement and of the documents referred to
in this Agreement, and in respect of the transactions contemplated hereby and
thereby. Each of the Buyer and the Seller irrevocably agrees that all claims in
respect of the interpretation and enforcement of the provisions of this
Agreement and of the documents referred to in this Agreement (other than the
Pensions Agreement), and in respect of the transactions contemplated hereby and
thereby, or with respect to any such action or proceeding, shall be heard and
determined in such a New York State or Federal court, and that such jurisdiction
of such courts with respect thereto shall be exclusive, except solely to the
extent that all such courts shall lawfully decline to exercise such
jurisdiction. Each of the Buyer and the Seller hereby waive, and agree not to
assert, as a defense in any action, suit or proceeding for the interpretation or
enforcement hereof or of any such document or in respect of any such
transaction, that it is not subject to such jurisdiction. Each of the Buyer and
the Seller hereby waive, and agree not to assert, to the maximum extent
permitted by law, as a defense in any action, suit or proceeding for the
interpretation or enforcement hereof or of any such document or in respect of
any such transaction, that such action, suit or proceeding may not be brought or
is not maintainable in such courts or that the venue thereof may not be
appropriate or that this Agreement or any such document may not be enforced in
or by such courts. The Buyer and the Seller hereby consent to and grant any such
court jurisdiction over the person of such parties and
139
<PAGE>
over the subject matter of any such dispute and agree that mailing of process or
other papers in connection with any such action or proceeding in the manner
provided in Section 13.2 or in such other manner as may be permitted by law,
shall be valid and sufficient service thereof.
13.4. Binding Effect; Sale of Logistics Business of the Seller. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, successors and permitted assigns. The
indemnification obligations in this Agreement and in the Tax Matters Agreement
shall be binding upon any Person that acquires all or substantially all of the
assets of the Logistics Business of the Seller, whether by merger, amalgamation
or consolidation, asset purchase, stock purchase or subscription or otherwise,
and the Seller shall not enter into any agreement for any such transaction that
does not so expressly provide.
13.5. Assignment. This Agreement shall not be assignable or otherwise
transferable by any party hereto without the prior written consent of the other
party hereto, and any purported assignment or other transfer without such
consent shall be void and unenforceable; provided, that the Buyer may assign
this Agreement to any Subsidiary of the Buyer, or to any lender to the Buyer or
any Subsidiary or Affiliate thereof as security for obligations to such lender,
and provided, further, that no assignment to any such lender shall in any way
affect the Buyer's obligations or liabilities under this Agreement.
13.6. No Third Party Beneficiaries. Except as provided in Article 11 with
respect to indemnification of Indemnified Parties hereunder, nothing in this
Agreement shall confer any rights upon any person or entity other than the
parties hereto and their respective heirs, successors and permitted assigns.
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<PAGE>
13.7. Amendment; Waivers, etc. No amendment, modification or discharge of
this Agreement, and no waiver hereunder, shall be valid or binding unless set
forth in writing and duly executed by the party against whom enforcement of the
amendment, modification, discharge or waiver is sought. Any such waiver shall
constitute a waiver only with respect to the specific matter described in such
writing and shall in no way impair the rights of the party granting such waiver
in any other respect or at any other time. Neither the waiver by any of the
parties hereto of a breach of or a default under any of the provisions of this
Agreement, nor the failure by any of the parties, on one or more occasions, to
enforce any of the provisions of this Agreement or to exercise any right or
privilege hereunder, shall be construed as a waiver of any other breach or
default of a similar nature, or as a waiver of any of such provisions, rights or
privileges hereunder. The rights and remedies of any party based upon, arising
out of or otherwise in respect of any inaccuracy or breach of any
representation, warranty, covenant or agreement or failure to fulfill any
condition shall in no way be limited by the fact that the act, omission,
occurrence or other state of facts upon which any claim of any such inaccuracy
or breach is based may also be the subject matter of any other representation,
warranty, covenant or agreement as to which there is no inaccuracy or breach.
The representations and warranties of the Seller shall not be affected or
deemed waived by reason of any investigation made by or on behalf of the Buyer
(including but not limited to by any of its advisors, consultants or
representatives) or by reason of the fact that the Buyer or any of such
advisors, consultants or representatives knew or should have known that any such
representation or warranty is or might be inaccurate.
13.8. Entire Agreement. This Agreement, the Annexes and Exhibits hereto,
the Seller Disclosure Letter, the Buyer Disclosure Letter, the Transaction
Agreements (when executed and delivered), the Letter Agreements and the
Confidentiality Agreement
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<PAGE>
constitute the entire agreement and supersede all prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof.
13.9. Severability. If any provision, including any phrase, sentence,
clause, section or subsection, of this Agreement is invalid, inoperative or
unenforceable for any reason, such circumstances shall not have the effect of
rendering such provision in question invalid, inoperative or unenforceable in
any other case or circumstance, or of rendering any other provision herein
contained invalid, inoperative, or unenforceable to any extent whatsoever.
13.10. Headings. The headings contained in this Agreement are for purposes
of convenience only and shall not affect the meaning or interpretation of this
Agreement.
13.11. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original and all of which shall
together constitute one and the same instrument.
13.12. Waiver of Jury Trial. Each of the parties waives any right to a
trial by jury with respect to any Litigation which arises out of, or which is
related to, the transactions contemplated by this Agreement.
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<PAGE>
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
NFC plc
By /s/Gerry Murphy
--------------------------------------------
Name: Gerry Murphy
Title: Group Chief Executive
NA Holding Corporation
By /s/R. Barry Uber
--------------------------------------------
Name: R. Barry Uber
Title: President and Chief Executive Officer
<PAGE>
Annex A
Selling Subsidiaries
Stock Transactions: NFC International Holdings (Netherlands II) BV
NFC International Holdings (USA) Investment Company
NFC Investments (Netherlands) B.V.
Asset Transaction: NFC Canada Ltd.
<PAGE>
Annex B
Target Subsidiaries
Stock Transactions:
European and Asia Pacific Target Subsidiaries:
<TABLE>
<CAPTION>
% of
Capital
Entity Jurisdiction Stock
------ ------------ -------
<S> <C> <C>
Allied International SA Spain 100
NFC Investments Asia Pacific Pte Ltd. Singapore 100
Allied Arthur Pierre NV Belgium 100
Allied Arthur Pierre SA France 100
Allied Arthur Pierre SA Luxembourg 100
Pierre Finance (Nederland) Renting BV The Netherlands 100
NFC International Holdings (Australasia) Pty Ltd Australia 100
The Baxendale Insurance Company Ltd. Ireland 90
Allied Pickfords BV The Netherlands 100
Allied Pickfords Polska SP ZOO Poland 100
Allied Pickfords KeS Kft Hungary 100
Allied Varekamp BV The Netherlands 100
Allied Pickfords sro Czech Republic 100
Allied Pickfords LLC United Arab Emirates 49
Allied Pickfords Ltd. Hong Kong 100
A.L. Movers Private Limited India 45
Target USA Subsidiary: Allied Van Lines Inc. 100
</TABLE>
Issuance of New Shares:
Target U.K. Subsidiary: Pickfords Ltd. Number of shares to be
agreed as per the Agreement
<PAGE>
Annex C-1
Transfers of Target Stock(1)
(1) NFC International Holdings (Netherlands II) BV(2) will sell the amount of
Target Stock set out below of the Target Subsidiaries set out below to one
or more Buying Subsidiaries in exchange for $60.5 million, the Warrant,
the Junior Preferred Stock and the Buyer Common Stock:
<TABLE>
<CAPTION>
% of
Target
Entity Jurisdiction Stock
------ ------------ ------
<S> <C> <C>
Allied International SA Spain 100
NFC Investments Asia Pacific Pte Ltd. Singapore 100
Allied Arthur Pierre NV Belgium 100
Allied Arthur Pierre SA France 100
Allied Arthur Pierre SA Luxembourg 100
Pierre Finance (Nederland) Renting BV The Netherlands 100
NFC International Holdings (Australasia) Pty Ltd Australia 100
The Baxendale Insurance Company Ltd. Ireland 90
Allied Pickfords BV The Netherlands 100
Allied Pickfords Polska SP ZOO Poland 100
Allied Pickfords KeS Kft(2) Hungary 100
Allied Varekamp BV The Netherlands 100
Allied Pickfords sro Czech Republic 100
Allied Pickfords LLC United Arab Emirates 49
Allied Pickfords Ltd. Hong Kong 100
A.L. Movers Private Limited India 45
</TABLE>
(2) NFC International Holdings (USA) Investment Company will sell the Target
Stock of Allied Van Lines Inc. to one or more Buying Subsidiaries for $138
million.
(3) Pickfords Ltd. will issue the U.K. Shares to one or more Buying
Subsidiaries for $194 million.
(4) NFC Canada Ltd. will sell the Canada Assets to one or more Buying
Subsidiaries for $7.5 million and the assumption of the Canada
Liabilities.
<PAGE>
Annex C-2
Subsidiaries of Target Subsidiaries
NFC Investment Asia Pacific Pte Ltd (Singapore)*
o Allied Pickfords (S) Pte Ltd (Singapore)
o Allied Pickfords (M) Sdn Bhd (Malaysia)
NFC International Holdings (Australasia) Pty Ltd (Australia)*
o Allied Pickfords Pty Ltd (Australia)
o Trans International Moving & Shipping Pty Ltd (Australia)
o NFC Australasia Superannuation Pty Ltd (Australia)*
o Downard Pickfords (North Queensland) Pty Ltd (Australia)
o NFC New Zealand Ltd (NZ)*
o Allied Pickfords Ltd (NZ)
o Trans International Moving & Shipping (NZ) 1992 Ltd (NZ)
o Imaging Systems (NZ) Ltd (NZ)
Allied Pickfords Ltd (Hong Kong)
o Pickfords Worldwide Moving Ltd (HK)
o Pickfords Ltd (HK)
Pickfords Ltd (England & Wales)
o Pickfords 1999 Limited (E&W)
o The Baxendale Insurance Company Ltd (Ire) (10%)
o A&N Removals Ltd (E&W)
o Arthur Pierre (UK) Ltd (E&W)
o Bullens Ltd (E&W)
o GB Crate Hire Ltd (E&W)
o Hoults Removals Ltd (E&W)
o NFC Moving Services Ltd (E&W)*
o Pitt & Scott Ltd (E&W)
o Allied Pickfords Ltd (E&W)
o Pickfords Manhire Ltd (E&W)
o Irish Security Archives Ltd (NI)
o Moving Services Property Ltd (E&W)
o Removedeal Ltd (E&W)
o Irish Security Archives Ltd (Ire)
o Allied Pickfords Ltd (Ire)
Allied Van Lines Inc. (USA)
o Allied International NA Inc. (USA)
o A Relocation Solutions Management Company (USA)
o AVL Transportation Inc. (USA)
o Allied Interstate Transportation Inc. (USA)
<PAGE>
Annex C-2
(Cont.)
o Allied Mobility Transportation Inc. (USA)
o Allied Universal Transportation Inc. (USA)
o Allied Van Lines Inc. of Indiana (USA)
o Meridian Mobility Resources Inc. (USA)
o Allied Van Lines Terminal Company (USA)
o Allied Freight Forwarding Inc. (USA)
o Allied Alliance Forwarding Inc. (USA)
o Allied Continental Forwarding Inc. (USA)
o Allied Domestic Forwarding Inc. (USA)
o Allied Intermodal Forwarding Inc. (USA)
o Allied Transcontinental Forwarding Inc. (USA)
o Allied Transportation Forwarding Inc. (USA)
o Trident Transport International Inc. (USA)
o TransGuard Insurance Company of America Inc. (USA)
o Claimguard Inc. (USA)
o Vanguard Insurance Agency Inc. (USA)
o TransGuard General Agency Inc. (USA)
<PAGE>
Annex C-3
Subsidiaries to be Transferred to NFC International
Holdings (Netherlands II) BV
Allied Arthur Pierre NV (Belgium)
Allied Arthur Pierre SA (France)
Allied Arthur Pierre SA (Lux)
Pierre Finance (Nederland) Renting BV
Allied International SA (Spain)
<PAGE>
Annex D
Allocation of Purchase Price
U.K. Shares $194 million
Canada $7.5 million + Canada Liabilities
European and Asia Pacific
Target Subsidiaries $110.5 million
Allied Van Lines, Inc. $138 million
$450,000,000 + Canada Liabilities
============
Allocation assumes that the Junior Preferred Stock has a value of $24.5
million and that the Buyer Common Stock and the Warrant have an aggregate
value of $25.5 million.
Unless the parties agree that a different adjustment is appropriate, any
purchase price adjustment made pursuant to Section 1.3 shall cause a
corresponding adjustment to the amount allocated to the European and Asia
Pacific Subsidiaries. Except to the extent otherwise provided by law, any
payments made pursuant to ARTICLE XI in respect of any member of the
Company Group shall cause a corresponding adjustment to the amount
allocated to such member pursuant to this Annex D.
<PAGE>
Annex G
Pro Forma Statement of Purchase Price Adjustment
As per Closing Balance Sheet:
(in the format of the Audited Financial Statements)
Fixed assets
Property, plant & equipment (net) (pound)
Investments
Goodwill
Current assets
Inventories
Debtors: Amounts falling due within one year
Debtors: Amounts falling due after more than one year
Cash at bank and in hand
Current liabilities
Creditors: Amounts falling due within one year
NFC Group balances
Provisions for liabilities and charges
Net Assets
Adjustments to Calculate Controllable Net Assets:
Add creditor (less debtor) NFC Group balances
Add creditor (less debtor) Tax balances
CLOSING CONTROLLABLE NET ASSETS
((pound) 92.4)
INCREASE/(REDUCTION) IN PURCHASE PRICE
<PAGE>
EXHIBIT 10.2
Conformed Copy
AMENDMENT NO. 1 TO THE ACQUISITION AGREEMENT
AMENDMENT NO. 1, dated as of November 19, 1999 (this "Amendment"), between
NA HOLDING CORPORATION, a Delaware corporation (the "Buyer") and NFC plc, a
company organized under the laws of England and Wales (the "Seller"), to the
ACQUISITION AGREEMENT, dated as of September 14, 1999 (the "Acquisition
Agreement"), between Buyer and Seller.
WHEREAS, Buyer and Seller wish to amend certain provisions of the
Acquisition Agreement (capitalized terms used herein and not otherwise defined
herein have the respective meanings ascribed to them in the Acquisition
Agreement and all references to Sections herein are references to Sections of
the Acquisition Agreement);
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the agreements herein contained, Buyer and
Seller, intending to be legally bound hereby, agree as follows:
1. The definition of "Closing Controllable Net Assets" is hereby amended
to read in its entirety as follows:
"Closing Controllable Net Assets: as set forth on the Closing Balance
Sheet, an amount equal to the net assets of the Company Group, excluding
all (x) Tax balances and (y) NFC Group balances other than intercompany
trade accounts payable or receivable arising from trading activities in
the ordinary course and existing between any member of the Selling Group,
on the one hand, and any member of the Company Group, on the other hand,
as of the Closing Date in each case as determined in a manner shown on the
Statement of Pro Forma Purchase Price Adjustment attached hereto as Annex
G; provided that with respect to Controllable Net Assets determined as of
the close of business on the Closing Date, the amount of trade debtor
assets on the Closing Balance Sheet shall be decreased by L0.8 million or
such lesser amount as remains uncollectible at Closing from Vanguard trade
debtors."
2. Amendment to Annex G. Annex G to the Acquisition Agreement is hereby
amended to read in its entirety as set forth on Annex A to this Amendment.
3. Confirmation of Acquisition Agreement. Other than as expressly modified
pursuant to this Amendment, all provisions of the Acquisition Agreement remain
unmodified and in full force and effect.
<PAGE>
4. Miscellaneous. This Amendment shall be governed by and construed in
accordance with the internal laws of the State of New York, without giving
effect to the conflict of laws rules thereof to the extent such rules would
require or permit the application of the law of another jurisdiction. This
Amendment may be executed in one or more counterparts, each of which shall be
deemed an original and all of which shall together constitute one and the same
instrument and shall bind and inure to the benefit of the parties and their
respective successors and assigns.
2
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first above written.
NFC plc
By /s/Jeremy Letchford
-----------------------
Name: Jeremy Letchford
Title: Secretary
NA HOLDING CORPORATION
By /s/Ralph A. Ford
-----------------------
Name: Ralph A. Ford
Title: Secretary
3
<PAGE>
Annex A
Pro Forma Statement of Purchase Price Adjustment
As per Closing Balance Sheet:
(in the format of the Audited Financial Statements)
Fixed assets
Property, plant & equipment (net) [Pound]
Investments
Goodwill
Current assets
Inventories
Debtors: Amounts falling due within one year
Debtors: Amounts falling due after more than one year
Cash at bank and in hand
Trade Accounts receivable to Selling Group
Current liabilities
Creditors: Amounts falling due within one year
NFC Group balances*
Trade Accounts payable to Selling Group
Provisions for liabilities and charges
Net Assets
Adjustments to Calculate Controllable Net Assets:
Add creditor (less debtor) NFC Group balances
Add creditor (less debtor) Tax balances
CLOSING CONTROLLABLE NET ASSETS
([Pound] 92.4)
INCREASE/(REDUCTION) IN PURCHASE PRICE
- ----------
* Excluding Trade Accounts receivable to Selling Group and Trade Accounts
payable to Selling Group.
<PAGE>
Exhibit 10.3
================================================================================
CREDIT AGREEMENT
AMONG
NORTH AMERICAN VAN LINES, INC.,
THE FOREIGN SUBSIDIARY BORROWERS
FROM TIME TO TIME PARTIES HERETO,
THE SEVERAL LENDERS
FROM TIME TO TIME PARTIES HERETO,
THE BANK OF NEW YORK,
AS DOCUMENTATION AGENT
BANC OF AMERICA SECURITIES LLC,
AS SYNDICATION AGENT
AND
THE CHASE MANHATTAN BANK,
AS COLLATERAL AGENT
AND ADMINISTRATIVE AGENT
DATED AS OF NOVEMBER 19, 1999
AND AMENDED AS OF NOVEMBER 23, 1999
================================================================================
CHASE SECURITIES INC. AND BANC OF AMERICA SECURITIES LLC,
AS ARRANGERS
<PAGE>
Page
----
TABLE OF CONTENTS
Page
----
SECTION 1. DEFINITIONS......................................................2
1.1 Defined Terms....................................................2
1.2 Other Definitional Provisions...................................30
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS.................................31
2.1 Revolving Credit Commitments....................................31
2.2 Revolving Credit Notes..........................................31
2.3 Procedure for Revolving Credit Borrowing........................32
2.4 Termination or Reduction of Revolving Credit Commitments........33
2.5 Swing Line Commitments..........................................33
2.6 Term Loans......................................................35
2.7 Tranche A Term Notes............................................35
2.8 Tranche B Term Notes............................................36
2.9 Procedure for Term Loan Borrowing...............................38
2.10 Repayment of Loans.............................................38
SECTION 3. LETTERS OF CREDIT...............................................39
3.1 L/C Commitment..................................................39
3.2 Procedure for Issuance of Letters of Credit.....................40
3.3 Fees, Commissions and Other Charges.............................40
3.4 L/C Participations..............................................41
3.5 Reimbursement Obligation of the Borrowers.......................42
3.6 Obligations Absolute............................................43
3.7 Letter of Credit Payments.......................................43
3.8 Application.....................................................44
SECTION 4. GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT...44
4.1 Interest Rates and Payment Dates................................44
4.2 Conversion and Continuation Options.............................44
4.3 Minimum Amounts of Tranches.....................................45
4.4 Optional and Mandatory Prepayments and Commitment Reductions....45
4.5 Commitment Fees; Administrative Agent's Fee; Other Fees.........49
4.6 Computation of Interest and Fees................................50
4.7 Inability to Determine Interest Rate............................50
4.8 Pro Rata Treatment and Payments.................................51
4.9 Illegality......................................................53
4.10 Requirements of Law............................................53
4.11 Taxes..........................................................55
4.12 Indemnity......................................................57
4.13 Certain Rules Relating to the Payment of Additional Amounts....58
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4.14 Controls on Prepayment if Aggregate Outstanding Revolving
Credit Exceeds Aggregate Revolving Credit Commitments........59
SECTION 5. REPRESENTATIONS AND WARRANTIES..................................60
5.1 Financial Condition.............................................60
5.2 No Change; Solvent..............................................62
5.3 Corporate Existence; Compliance with Law........................62
5.4 Corporate Power; Authorization; Enforceable Obligations.........62
5.5 No Legal Bar....................................................63
5.6 No Material Litigation..........................................63
5.7 No Default......................................................63
5.8 Ownership of Property; Liens....................................63
5.9 Intellectual Property...........................................64
5.10 No Burdensome Restrictions.....................................64
5.11 Taxes..........................................................64
5.12 Federal Regulations............................................64
5.13 ERISA..........................................................64
5.14 Collateral.....................................................65
5.15 Investment Company Act; Other Regulations......................66
5.16 Subsidiaries...................................................66
5.17 Purpose of Loans...............................................66
5.18 Environmental Matters..........................................66
5.19 No Material Misstatements......................................67
5.20 Delivery of the Transaction Documents..........................68
5.21 Representations and Warranties Contained in the Transaction
Documents ...................................................68
5.22 Labor Matters..................................................68
5.23 Senior Indebtedness............................................68
5.24 Year 2000......................................................68
SECTION 6. CONDITIONS PRECEDENT............................................69
6.1 Conditions to Initial Extension of Credit.......................69
6.2 Conditions to Each Other Extension of Credit....................75
6.3 Additional Conditions Applicable to Foreign Subsidiary
Borrowers.....................................................75
SECTION 7. AFFIRMATIVE COVENANTS...........................................77
7.1 Financial Statements............................................77
7.2 Certificates; Other Information.................................79
7.3 Payment of Obligations..........................................80
7.4 Conduct of Business and Maintenance of Existence................80
7.5 Maintenance of Property; Insurance..............................80
7.6 Inspection of Property; Books and Records; Discussions..........80
7.7 Notices.........................................................80
7.8 Environmental Laws..............................................82
7.9 After-Acquired Real Property and Fixtures.......................83
7.10 Acquired Subsidiaries; Further Security and Guarantees.........84
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7.11 Interest Rate Protection Agreement.............................85
7.12 Capital Contributions from Holding.............................85
7.13 Maintenance of New York Process Agent..........................85
7.14 Updated Survey for California Mortgaged Property...............86
SECTION 8. NEGATIVE COVENANTS..............................................86
8.1 Financial Condition Covenants...................................86
8.2 Limitation on Indebtedness......................................87
8.3 Limitation on Liens.............................................89
8.4 Limitation on Guarantee Obligations.............................91
8.5 Limitation on Fundamental Changes...............................93
8.6 Limitation on Sale of Assets....................................94
8.7 Limitation on Loans and Dividends to Holding....................96
8.8 Limitation on Capital Expenditures..............................97
8.9 Limitation on Investments, Loans and Advances...................97
8.10 Limitations on Certain Acquisitions...........................100
8.11 Limitation on Transactions with Affiliates....................100
8.12 Limitation on Sales and Leasebacks............................102
8.13 Limitations on Dispositions of Collateral.....................102
8.14 Limitation on Changes in Fiscal Year..........................102
8.15 Limitation on Negative Pledge Clauses.........................102
8.16 Limitation on Lines of Business; Creation of Subsidiaries.....103
8.17 Limitation on Optional Payments and Modifications of Debt
Instruments and other Material Agreements...................103
SECTION 9. EVENTS OF DEFAULT..............................................104
SECTION 10. THE ADMINISTRATIVE AGENT AND THE OTHER REPRESENTATIVES........108
10.1 Appointment...................................................108
10.2 Delegation of Duties..........................................108
10.3 Exculpatory Provisions........................................108
10.4 Reliance by Administrative Agent..............................109
10.5 Notice of Default.............................................109
10.6 Acknowledgments and Representations by Lenders................109
10.7 Indemnification...............................................110
10.8 Administrative Agent and Other Representatives in Their
Respective Individual Capacities............................111
10.9 Successor Administrative Agent................................111
10.10 Swing Line Lender............................................111
10.11 Release of Liens in Connection with Permitted Receivables
Securitization .............................................111
SECTION 11. MISCELLANEOUS.................................................112
11.1 Amendments and Waivers........................................112
11.2 Notices.......................................................115
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11.3 No Waiver; Cumulative Remedies................................116
11.4 Survival of Representations and Warranties....................116
11.5 Payment of Expenses and Taxes.................................116
11.6 Successors and Assigns; Participations and Assignments........117
11.7 Adjustments; Set-off..........................................121
11.8 Counterparts..................................................121
11.9 Severability..................................................122
11.10 Integration..................................................122
11.11 GOVERNING LAW................................................122
11.12 Submission To Jurisdiction; Waivers..........................122
11.13 Judgment.....................................................123
11.14 Acknowledgments..............................................124
11.15 WAIVER OF JURY TRIAL.........................................124
11.16 Confidentiality..............................................124
11.17 Amendment and Restatement....................................125
<PAGE>
SCHEDULES
I Commitments; Lending Offices and Addresses
II Applicable Margin and Commitment Fee Step-Downs
III Designated Foreign Currencies
IV Foreign Subsidiary Borrowers
V Subsidiary Guarantors
VI Indicative Terms of Permitted Receivables Securitizations
VII Existing Letters of Credit
4.4(d) Fiscal Year End
5.4 Consents, Authorizations, Notices and Filings Required
5.14 Filing Jurisdictions and Lien Searches
5.16 Subsidiaries
8.2(e) Permitted Indebtedness
8.3(j) Permitted Liens
8.4(a) Guarantee Obligations
8.9(c) Permitted Investments
8.11(v) Permitted Transactions with Affiliates
EXHIBITS
A-1 Form of Revolving Credit Note
A-2 Form of Tranche A Term Note
A-3 Form of Tranche B Term Note
A-4 Form of Swing Line Note
B Form of Guarantee and Collateral Agreement
C Form of U.S. Tax Compliance Certificate
D Form of Prepayment Option Notice
E Form of Mortgage
F Form of Landlord Consent
G-1 Form of Opinion of Special Counsel to the Borrowers
G-2 Form of Opinion of Local Counsel to the Borrowers
G-3 Form of Opinion of Counsel to the Foreign Subsidiary Borrowers
H Form of Assignment and Acceptance
I Form of Swing Line Loan Participation Certificate
J Form of Borrowing Certificate
K Form of Joinder Agreement
<PAGE>
CREDIT AGREEMENT, dated as of November 19, 1999 and amended as of
November 23, 1999, among NORTH AMERICAN VAN LINES, INC., a Delaware corporation
(the "Parent Borrower"), THE FOREIGN SUBSIDIARY BORROWERS (as hereinafter
defined) (the Foreign Subsidiary Borrowers, together with the Parent Borrower,
being collectively referred to as the "Borrowers" and each of them individually
being referred to as a "Borrower"), the several banks and other financial
institutions from time to time parties to this Agreement (the "Lenders"), THE
BANK OF NEW YORK, as documentation agent (in such capacity, the "Documentation
Agent"), BANC OF AMERICA SECURITIES LLC, as syndication agent (in such capacity,
the "Syndication Agent"), and THE CHASE MANHATTAN BANK, a New York banking
corporation, as collateral agent and administrative agent for the Lenders
hereunder (in such capacities, the "Administrative Agent").
The parties hereto hereby agree as follows:
WHEREAS, the Parent Borrower and certain of the Parent Borrower's
wholly owned subsidiaries propose to acquire (the "Acquisition") substantially
all of the capital stock (or substantially all of the assets) of certain
subsidiaries of NFC plc, a company organized under the laws of England and Wales
(the "Seller"), that are engaged in the Seller's moving services business (the
"Acquired Business"), including without limitation Allied Van Lines Inc., for
approximately (a) $400,000,000 in cash, (b) 24,500 shares of preferred stock of
NA Holding Corporation, a Delaware corporation and the holding company parent of
the Parent Borrower ("Holding"), having an initial liquidation preference of
$24,500,000, (c) 174,961 shares of common stock of Holding, representing
approximately 20% of Holding's issued and outstanding common stock (giving
effect to vested options as of September 14, 1999), and (d) a warrant to
purchase 87,480 shares of common stock of Holding at an exercise price of $400
per share, pursuant to the terms of the Acquisition Agreement, dated as of
September 14, 1999 (as amended, supplemented or otherwise modified from time to
time, the "Acquisition Agreement"), between Holding and the Seller;
WHEREAS, in order to (a) finance a portion of the purchase price of
the Acquisition, (b) refinance certain existing indebtedness of the Parent
Borrower, (c) pay certain transaction fees and expenses related to the
Acquisition, not to exceed $30,000,000 and (d) finance the working capital and
other business requirements of the Parent Borrower and its subsidiaries
following the consummation of the Acquisition, (w) the Parent Borrower intends
to issue approximately $150,000,000 of senior subordinated unsecured notes in a
Rule 144A private placement, (x) Holding intends to issue senior discount notes
for gross cash proceeds of approximately $35,000,000, (y) Holding intends to
borrow $40,000,000, which loan is contemplated to be repaid by December 31, 1999
with the proceeds of equity committed to be provided, and (z) the Parent
Borrower has requested that the Lenders make the Loans and issue and participate
in the Letters of Credit (as such terms are hereinafter defined) provided for
herein; and
WHEREAS, all the obligations of the Borrowers hereunder will be
secured by, among other things, (a) a perfected lien on and security interest in
certain collateral described in the Security Documents (such term and each other
capitalized term used in this paragraph and not otherwise previously defined, as
hereinafter defined), (b) a pledge of all the issued and outstanding Capital
Stock (other than any such Capital Stock owned by unrelated third parties) of
the Parent Borrower and each Domestic Subsidiary of the Parent Borrower that is
a Material Subsidiary, whether now existing or subsequently organized or
acquired, (c) a pledge of the issued and outstanding Capital Stock of each
Foreign Subsidiary Holdco and each Foreign Subsidiary of the Parent Borrower
that is not a Subsidiary
<PAGE>
2
of a Foreign Subsidiary Holdco, in each case, whether now existing or
subsequently organized or acquired (which security interest shall not apply to
more than 65% of the Capital Stock of any such Foreign Subsidiary Holdco or
Foreign Subsidiary), and (d) agreements evidencing unconditional guarantees of
payment and performance by each of the Guarantors;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein, the parties hereto agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following terms
shall have the following meanings:
"ABR": for any day, a rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to the greatest of (a) the Prime Rate in
effect on such day, (b) the Base CD Rate in effect on such day plus 1% and
(c) the Federal Funds Effective Rate in effect on such day plus 2 of 1%.
For purposes hereof: "Prime Rate" shall mean the rate of interest per
annum publicly announced from time to time by Chase as its prime rate in
effect at its principal office in New York City (the Prime Rate not being
intended to be the lowest rate of interest charged by Chase in connection
with extensions of credit to debtors); "Base CD Rate" shall mean the sum
of (a) the product of (i) the Three-Month Secondary CD Rate and (ii) a
fraction, the numerator of which is one and the denominator of which is
one minus the C/D Reserve Percentage and (b) the C/D Assessment Rate;
"Three-Month Secondary CD Rate" shall mean, for any day, the secondary
market rate for three-month certificates of deposit reported as being in
effect on such day (or, if such day shall not be a Business Day, the next
preceding Business Day) by the Board of Governors of the Federal Reserve
System (the "Board") through the public information telephone line of the
Federal Reserve Bank of New York (which rate will, under the current
practices of the Board, be published in Federal Reserve Statistical
Release H.15(519) during the week following such day), or, if such rate
shall not be so reported on such day or such next preceding Business Day,
the average of the secondary market quotations for three-month
certificates of deposit of major money center banks in New York City
received at approximately 10:00 A.M., New York City time, on such day (or,
if such day shall not be a Business Day, on the next preceding Business
Day) by the Administrative Agent from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it; and
"Federal Funds Effective Rate" shall mean, for any day, the weighted
average of the rates on overnight federal funds transactions with members
of the Federal Reserve System arranged by federal funds brokers, as
published on the next succeeding Business Day by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations for the day of such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by it. Any change in the ABR due
to a change in the Prime Rate, the Three-Month Secondary CD Rate or the
Federal Funds Effective Rate shall be effective as of the opening of
business on the effective day of such change in the Prime Rate, the
Three-Month Secondary CD Rate or the Federal Funds Effective Rate,
respectively.
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3
"ABR Loans": Loans the rate of interest applicable to which is based
upon the ABR.
"Acceleration": as defined in Section 9(e).
"Accepting Lenders": as defined in subsection 4.4(g).
"Accounts": as defined in the Uniform Commercial Code as in effect
in the State of New York; and, with respect to the Parent Borrower and its
Domestic Subsidiaries, all such Accounts of such Persons, whether now
existing or existing in the future, including, without limitation, (i) all
accounts receivable of such Person (whether or not specifically listed on
schedules furnished to the Administrative Agent) including, without
limitation, all accounts created by or arising from all of such Person's
sales of goods or rendition of services made under any of its trade names,
or through any of its divisions, (ii) all unpaid rights of such Person
(including rescission, replevin, reclamation and stopping in transit)
relating to the foregoing or arising therefrom, (iii) all rights to any
goods represented by any of the foregoing, including returned or
repossessed goods, (iv) all reserves and credit balances held by such
Person with respect to any such accounts receivable or any Obligors, (v)
all letters of credit, guarantees or collateral for any of the foregoing
and (vi) all insurance policies or rights relating to any of the
foregoing.
"Acquired Business": as defined in the Recitals hereto.
"Acquisition": as defined in the Recitals hereto.
"Acquisition Agreement": as defined in the Recitals hereto.
"Adjustment Date": each date occurring after the completion of the
first fiscal quarter of the Parent Borrower after the Effective Date that
is the second Business Day following receipt by the Lenders of both (i)
the financial statements required to be delivered pursuant to subsection
7.1(c) or 7.1(d), as applicable, for the most recently completed fiscal
period and (ii) the related compliance certificate required to be
delivered pursuant to subsection 7.2(b) with respect to such fiscal
period.
"Administrative Agent": as defined in the Preamble hereto.
"Affected Eurocurrency Loans": as defined in subsection 4.9.
"Affected Eurocurrency Rate": as defined in subsection 4.7.
"Affiliate": as to any Person, any other Person (other than a
Subsidiary) which, directly or indirectly, is in control of, is controlled
by, or is under common control with, such Person. For purposes of this
definition, "control" of a Person means the power, directly or indirectly,
either to (a) vote 20% or more of the securities having ordinary voting
power for the election of directors of such Person or (b) direct or cause
the direction of the management and policies of such Person, whether by
contract or otherwise.
<PAGE>
4
"Agents": those independently owned local moving and storage
companies that have entered into certain contractual arrangements with the
Parent Borrower or any of its Subsidiaries to provide customers with the
local sales, packing and warehousing services and a portion of the hauling
services required to support the interstate moving operators of the Parent
Borrower and its Subsidiaries, or any combination of such services.
"Aggregate Outstanding Revolving Credit": as to any Revolving Credit
Lender at any time, an amount equal to the sum of (a) the aggregate
principal amount of all Revolving Credit Loans made by such Revolving
Credit Lender then outstanding (including, without limitation, in the case
of Revolving Credit Loans then outstanding in any Designated Foreign
Currency, the Dollar Equivalent of the aggregate principal amount
thereof), (b) such Revolving Credit Lender's Revolving Credit Commitment
Percentage of the L/C Obligations then outstanding and (c) such Revolving
Credit Lender's Revolving Credit Commitment Percentage of the Swing Line
Loans then outstanding.
"Agreement": this Credit Agreement, as amended, supplemented, waived
or otherwise modified from time to time.
"Applicable Margin": (i) as applied to a given Type of Tranche B
Term Loans, the rate per annum set forth under the relevant column heading
below:
ABR Loans Eurocurrency Loans
--------- ------------------
3.00% 4.00%
provided that the foregoing margins shall be reduced to 2.75%, in the case
of ABR Loans, and 3.75%, in the case of Eurocurrency Loans, on the first
Adjustment Date for which the Leverage Ratio, determined from the
financial statements and compliance certificate relating to the end of the
fiscal quarter immediately preceding such Adjustment Date, is less than
3.75 to 1.00;
(ii) as applied to a given Type of Revolving Credit Loans or Tranche
A Term Loans, the rate per annum determined as follows: During the period
from the Effective Date until the first Adjustment Date, the Applicable
Margin in respect of Revolving Credit Loans and Tranche A Term Loans shall
equal (A) with respect to ABR Loans, 2.00% per annum and (B) with respect
to Eurocurrency Loans, 3.00% per annum. Such Applicable Margin will be
adjusted on each Adjustment Date to the applicable rate per annum set
forth under the heading "ABR Loans Applicable Margin" or "Eurocurrency
Loans Applicable Margin" on Schedule II which corresponds to the
achievement of certain performance criteria determined from the financial
statements and compliance certificate relating to the end of the fiscal
quarter immediately preceding such Adjustment Date; provided that in the
event that the financial statements required to be delivered pursuant to
subsection 7.1(c) or 7.1(d), as applicable, and the related compliance
certificate required to be delivered pursuant to subsection 7.2(b), are
not delivered when due, then
(a) if such financial statements and certificate are delivered
after the date such financial statements and certificate were
required to be delivered (without giving effect
<PAGE>
5
to any applicable cure period) and the Applicable Margin increases
from that previously in effect as a result of the delivery of such
financial statements, then the Applicable Margin in respect of
Revolving Credit Loans and Tranche A Term Loans during the period
from the date upon which such financial statements were required to
be delivered (without giving effect to any applicable cure period)
until the date upon which they actually are delivered shall, except
as otherwise provided in clause (c) below, be the Applicable Margin
as so increased;
(b) if such financial statements and certificate are delivered
after the date such financial statements and certificate were
required to be delivered and the Applicable Margin decreases from
that previously in effect as a result of the delivery of such
financial statements, then such decrease in the Applicable Margin
shall not become applicable until the date upon which the financial
statements and certificate actually are delivered; and
(c) if such financial statements and certificate are not
delivered prior to the expiration of the applicable cure period,
then, effective upon such expiration, for the period from the date
upon which such financial statements and certificate were required
to be delivered (after the expiration of the applicable cure period)
until two Business Days following the date upon which they actually
are delivered, the Applicable Margin in respect of Revolving Credit
Loans and Tranche A Term Loans shall be 3.00% per annum, in the case
of Eurocurrency Loans, and 2.00% per annum, in the case of ABR Loans
(it being understood that the foregoing shall not limit the rights
of the Administrative Agent and the Lenders set forth in Section 9).
"Application": an application, in such form as the Issuing Lender
may specify from time to time, requesting the Issuing Lender to open a
Letter of Credit.
"Approved Fund": with respect to any Lender that is a fund that
invests in bank loans, any other fund that invests in bank loans which is
managed or advised by the same investment advisor as such Lender or by an
affiliate of such investment advisor.
"Arrangers": CSI and BAS in their respective capacities as arrangers
and as joint financial advisors.
"Asset Sale": any sale, issuance, conveyance, transfer, lease or
other disposition (a "Disposition") by Holding or any of its Subsidiaries,
in one or a series of related transactions, of any real or personal,
tangible or intangible, property (including, without limitation, Capital
Stock) of Holding or such Subsidiary to any Person (other than to Holding
or any of its Wholly Owned Subsidiaries) which yields gross proceeds to
Holding or any of its Subsidiaries (valued at the initial principal amount
thereof in the case of non-cash proceeds consisting of notes or other debt
securities and valued at fair market value in the case of other non-cash
proceeds) in excess of $500,000, provided that the term Asset Sale shall
not include any Disposition by any Insurance Subsidiary of its property in
the ordinary course of conducting its insurance business.
<PAGE>
6
"Assignee": as defined in subsection 11.6(c).
"Assignment and Acceptance": as defined in subsection 11.6(c).
"Available Adjustment": as of any date of determination, $10,000,000
less the sum of (a) all amounts used prior to such date in respect of any
period to increase EBITDA in accordance with clause (k) of the definition
thereof and (b) all amounts used prior to such date for Capital
Expenditures made solely in reliance on clause (b) of subsection 8.8.
"Available Revolving Credit Commitment": as to any Revolving Credit
Lender at any time, an amount equal to the excess, if any, of (a) the
amount of such Revolving Credit Lender's Revolving Credit Commitment at
such time over (b) the sum of (i) the aggregate unpaid principal amount at
such time of all Revolving Credit Loans made by such Revolving Credit
Lender (including, without limitation, in the case of Revolving Credit
Loans made by such Revolving Credit Lender in any Designated Foreign
Currency, the Dollar Equivalent of the aggregate unpaid principal amount
thereof), (ii) an amount equal to such Revolving Credit Lender's Revolving
Credit Commitment Percentage of the aggregate unpaid principal amount at
such time of all Swing Line Loans, provided that for purposes of
calculating Available Revolving Credit Commitments pursuant to subsection
4.5(a) such amount shall be zero, and (iii) an amount equal to such
Revolving Credit Lender's Revolving Credit Commitment Percentage of the
outstanding L/C Obligations at such time; collectively, as to all the
Lenders, the "Available Revolving Credit Commitments".
"BAS": Banc of America Securities LLC.
"Base CD Rate": as defined in the definition of the term "ABR" in
this subsection 1.1.
"Baxendale": Baxendale Insurance Company Ltd., a corporation
organized under the laws of Ireland and a Wholly Owned Subsidiary of the
Parent Borrower.
"Benefitted Lender": as defined in subsection 11.7.
"Board": as defined in the definition of the term "ABR" in this
subsection 1.1.
"Borrowers": as defined in the Preamble hereto.
"Borrowing Date": any Business Day specified in a notice pursuant to
subsection 2.3, 2.5, 2.9 or 3.2 as a date on which the Parent Borrower
requests the Lenders to make Loans hereunder or the Issuing Lender to
issue Letters of Credit hereunder.
"Business": as defined in subsection 5.18(a).
"Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in New York, New York are authorized or required by
law to close, except that, when used in connection with a Eurocurrency
Loan, "Business Day" shall mean, in the case of any
<PAGE>
7
Eurocurrency Loan in Dollars, any Business Day on which dealings in
Dollars between banks may be carried on in London, England and New York,
New York and, in the case of any Eurocurrency Loan in any Designated
Foreign Currency, a day on which dealings in such Designated Foreign
Currency between banks may be carried on in London, England and the
principal financial center of such Designated Foreign Currency as set
forth on Schedule III; provided, however, that, with respect to notices
and determinations in connection with, and payments of principal and
interest on, Loans denominated in Euros, such day is also a day on which
the Trans-European Automated Real-Time Gross Settlement Express Transfer
System (TARGET) (or, if such clearing system ceases to be operative, such
other clearing system (if any) determined by the Administrative Agent to
be a suitable replacement) is open for settlement of payment in Euros.
"Capital Expenditures": with respect to any Person for any period,
the sum of the aggregate of all expenditures (excluding capital
expenditures made for acquisitions permitted by subsection 8.10) by such
Person and its consolidated Subsidiaries during such period which, in
accordance with GAAP, are or should be included in "capital expenditures"
or similar items reflected in the consolidated statement of cash flows of
such Person for such period.
"Capital Stock": any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation,
any and all equivalent ownership interests in a Person (other than a
corporation) and any and all warrants or options to purchase any of the
foregoing.
"Cash Equivalents": (a) securities issued or fully guaranteed or
insured by the United States Government or any agency or instrumentality
thereof, (b) time deposits, certificates of deposit or bankers'
acceptances of (i) any Lender or (ii) any commercial bank having capital
and surplus in excess of $500,000,000 and the commercial paper of the
holding company of which is rated at least A-2 or the equivalent thereof
by Standard & Poor's Ratings Group (a division of The McGraw-Hill
Companies, Inc.) or any successor rating agency ("S&P") or at least P-2 or
the equivalent thereof by Moody's Investors Service, Inc. or any successor
rating agency ("Moody's") (or if at such time neither is issuing ratings,
then a comparable rating of such other nationally recognized rating agency
as shall be approved by the Administrative Agent in its reasonable
judgment), (c) commercial paper rated at least A-2 or the equivalent
thereof by S&P or at least P-2 or the equivalent thereof by Moody's (or if
at such time neither is issuing ratings, then a comparable rating of such
other nationally recognized rating agency as shall be approved by the
Administrative Agent in its reasonable judgment), (d) investments in money
market funds complying with the risk limiting conditions of Rule 2a-7 or
any successor rule of the Securities and Exchange Commission under the
Investment Company Act, and (e) investments similar to any of the
foregoing denominated in foreign currencies approved by the board of
directors of the Parent Borrower, in each case provided in clauses (a),
(b), (c), (d) and (e) above, maturing within twelve months after the date
of acquisition.
"CD&R": Clayton, Dubilier & Rice, Inc.
<PAGE>
8
"CD&R Fund V": Clayton, Dubilier & Rice Fund V Limited Partnership,
a Cayman Islands exempted limited partnership managed by CD&R.
"CD&R Group": CD&R Fund V, CD&R and their Affiliates (other than any
Persons who are Affiliates solely by virtue of their direct or indirect
ownership interests in Holding) and any other investment fund or vehicle
managed, sponsored or advised by CD&R, or any Affiliate (other than any
Person who is an Affiliate solely by virtue of its direct or indirect
ownership interest in Holding) of or successor to CD&R, CD&R Fund V or any
such other investment fund or vehicle.
"C/D Assessment Rate": for any day as applied to any ABR Loan, the
annual assessment rate in effect on such day which is payable by a member
of the Bank Insurance Fund classified as well-capitalized and within
supervisory subgroup "B" (or a comparable successor assessment risk
classification) within the meaning of 12 C.F.R. ss.327.4 (or any successor
provision) to the Federal Deposit Insurance Corporation (or any successor)
for such Corporation's (or such successor's) insuring time deposits at
offices of such institution in the United States.
"C/D Reserve Percentage": for any day as applied to any ABR Loan,
that percentage (expressed as a decimal) which is in effect on such day,
as prescribed by the Board, for determining the maximum reserve
requirement for a Depositary Institution (as defined in Regulation D of
the Board) in respect of new non-personal time deposits in Dollars of
$100,000 or more having a maturity of 30 days or more.
"Change in Consolidated Working Capital": for any period, the amount
of Consolidated Working Capital at the beginning of such period minus the
amount of Consolidated Working Capital at the end of such period.
"Change of Control": the occurrence of any of the following events:
(i) prior to the initial registered public offering of Holding's Voting
Stock, the Equity Investors and their Affiliates shall in the aggregate
beneficially own shares of Voting Stock having less than 51% of the total
voting power of all outstanding shares of Voting Stock of Holding, (ii) on
and after the date of the initial registered public offering of Holding's
Voting Stock, (a) any Person or "group" (within the meaning of Section
13(d) or 14(d) of the Exchange Act), other than one or more of the Equity
Investors and their Affiliates, shall have acquired beneficial ownership
of more than 35% of the outstanding shares of Voting Stock of Holding or
(b) the board of directors of Holding shall cease to consist of a majority
of Continuing Directors, (iii) Holding shall cease to own 100% of the
Capital Stock of the Parent Borrower or (iv) a change of control shall
have occurred under the Preferred Stock Certificate of Designation, any
other certificate of designation setting forth the terms of any other
issued and outstanding preferred stock of Holding, any Indenture or any
other indenture pursuant to which Holding or any of its Subsidiaries has
issued and outstanding Indebtedness; as used in this paragraph "Voting
Stock" shall mean shares of Capital Stock entitled to vote generally in
the election of directors.
"Chase": The Chase Manhattan Bank, a New York banking corporation.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
<PAGE>
9
"Collateral": all assets of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security
Document.
"Commitment Fee Rate": 2 of 1% per annum; provided, that on and
after the first Adjustment Date, the Commitment Fee Rate will be the
applicable rate per annum set forth on Schedule II under the heading
"Commitment Fee" (determined on each Adjustment Date in the same manner as
described in the definition of "Applicable Margin").
"Commercial Letter of Credit": as defined in subsection 3.1(a).
"Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with the Parent Borrower
within the meaning of Section 4001 of ERISA or is part of a group which
includes the Parent Borrower and which is treated as a single employer
under Section 414 of the Code.
"Consolidated Interest Coverage Ratio": at the last day of each
fiscal quarter of the Parent Borrower, and with respect to the period of
four fiscal quarters ending on such date, the ratio of (a) an amount equal
to EBITDA for such period to (b) Consolidated Interest Expense for such
period.
"Consolidated Interest Expense": for any period, (a) interest
expense (accrued and paid or payable in cash for such period, and in any
event excluding any amortization or write-off of financing costs) on
Indebtedness of the Parent Borrower and its consolidated Subsidiaries for
such period, plus (b) cash dividend payments, or loans and advances, to
Holding made during such period in respect of the Holding Preferred Stock,
any Holding Subordinated Exchange Debentures, the Holding Loan and the
Holding Senior Discount Notes, minus (c) interest income (accrued and
received or receivable in cash for such period) of the Parent Borrower and
its consolidated Subsidiaries (other than Insurance Subsidiaries) for such
period, in each case determined on a consolidated basis in accordance with
GAAP; provided that in the event of the consummation of a Permitted
Receivables Securitization, "Consolidated Interest Expense" shall be
adjusted to include (without duplication) an amount equal to the interest
(or other fees in the nature of interest or discount accrued and paid or
payable in cash for such period) on such Permitted Receivables
Securitization.
"Consolidated Net Income": for any period, net income of the Parent
Borrower and its consolidated Subsidiaries for such period, determined on
a consolidated basis in accordance with GAAP.
"Consolidated Senior Debt": all Consolidated Total Funded
Indebtedness/ Securitizations other than Subordinated Debt.
"Consolidated Total Funded Indebtedness/Securitizations": at the
date of determination thereof, (i) all Indebtedness of the Parent Borrower
and its consolidated Subsidiaries which by its terms matures more than one
year after the date of its creation, and any such Indebtedness
<PAGE>
10
maturing within one year from such date which is renewable or extendable
at the option of the obligor to a date more than one year from such date
including, in any event, all current maturities and current sinking fund
payments in respect of such Indebtedness whether or not required to be
paid within one year from the date of its creation and, in the case of the
Borrowers, Indebtedness in respect of the Loans and the Senior
Subordinated Notes, in each case determined on a consolidated basis in
accordance with GAAP plus (ii) without duplication of amounts included in
clause (i) above, an amount equal to the aggregate cash proceeds received
by the Parent Borrower or any Subsidiary from an unrelated third party
(net of amounts repaid) from the financing of Accounts pursuant to any
Permitted Receivables Securitization which are outstanding at the date of
determination minus (iii) if there are no Revolving Credit Loans or Swing
Line Loans then outstanding, the aggregate amount of all cash and Cash
Equivalents of the Parent Borrower and its consolidated Subsidiaries, to
the extent such cash and Cash Equivalents are on deposit in one or more
accounts maintained with the Administrative Agent and are not subject to
any Lien in favor of a third party (other than the Lien in favor of the
Administrative Agent for the benefit of the Lenders). In determining under
clause (i) of this definition the Indebtedness of the Parent Borrower and
its consolidated Subsidiaries under or in respect of any Permitted
Receivables Securitization or under clause (ii) of this definition the
amount equal to the aggregate cash proceeds received by the Parent
Borrower or any such Subsidiary from the financing of any Accounts
pursuant to any Permitted Receivables Securitization, such Indebtedness or
amount shall be reduced by any escrowed or pledged cash proceeds which
effectively secure such Indebtedness or the obligations of the Parent
Borrower or any such Subsidiary under such Permitted Receivables
Securitization, to the extent the amount of such cash proceeds has not
already been applied to reduce Indebtedness of the Parent Borrower and its
consolidated Subsidiaries pursuant to clause (iii) of this definition.
"Consolidated Working Capital": at the date of determination
thereof, the aggregate amount of all current assets (excluding cash, Cash
Equivalents and deferred taxes recorded as assets) minus the aggregate
amount of all current liabilities (excluding the Revolving Credit Loans,
current maturities of long-term debt, working capital debt of Foreign
Subsidiaries and deferred taxes recorded as liabilities), in each case
determined on a consolidated basis for the Parent Borrower and its
consolidated Subsidiaries.
"Continuing Directors": the directors of Holding on the Effective
Date, after giving effect to the Acquisition and the other transactions
contemplated hereby, and each other director, if, in each case, such other
director's nomination for election to the board of directors of Holding is
recommended by at least 66-2/3% of the then Continuing Directors or such
other director receives the affirmative vote of a majority of the votes
cast by the Equity Investors in respect of Voting Shares of Holding
beneficially owned by them in the election of such other director by the
shareholders of Holding.
"Contractual Obligation": as to any Person, any provision of any
material security issued by such Person or of any material agreement,
instrument or other undertaking to which such Person is a party or by
which it or any of its property is bound.
"CSI": Chase Securities Inc., a New York corporation.
<PAGE>
11
"Default": any of the acts, conditions or events specified in
Section 9, whether or not any requirement for the giving of notice (other
than, in the case of Section 9(e), a Default Notice), the lapse of time,
or both, or any other condition, has been satisfied.
"Default Notice": as defined in Section 9(e).
"Designated Foreign Currencies": the currencies set forth on
Schedule III and any other available and freely convertible foreign
currency selected by the Parent Borrower and approved by the
Administrative Agent and all of the Revolving Credit Lenders in accordance
with subsection 11.1(b).
"Disinterested Director": as defined in subsection 8.11.
"Disposition": as defined in the definition of the term "Asset Sale"
in this subsection 1.1.
"Documentation Agent": as defined in the Preamble hereto.
"Dollar Equivalent": with respect to the principal amount of any
Eurocurrency Loan made or outstanding in any Designated Foreign Currency
or any amount in respect of any Letter of Credit denominated in any
Designated Foreign Currency, at any date of determination thereof, an
amount in Dollars equivalent to such principal amount or such other amount
calculated on the basis of the Spot Rate of Exchange.
"Dollars" and "$": dollars in lawful currency of the United States
of America.
"Domestic Subsidiary": any Subsidiary of the Parent Borrower which
is not a Foreign Subsidiary.
"EBITDA": for any period, Consolidated Net Income for such period
adjusted to exclude the following items (without duplication) of income or
expense to the extent that such items are included in the calculation of
Consolidated Net Income: (a) Consolidated Interest Expense, (b) any
non-cash expenses and charges (excluding any such charge that constitutes
an accrual of or a reserve for cash charges for any future period), (c)
total income tax expense, (d) depreciation expense, (e) the expense
associated with amortization of intangible and other assets (including
amortization or other expense recognition of any costs associated with
asset write-ups in accordance with APB Nos. 16 and 17), (f) non-cash
provisions for reserves for discontinued operations, (g) any
extraordinary, unusual or non-recurring gains or losses or charges or
credits, (h) any gain or loss associated with the sale or write-down of
assets not in the ordinary course of business, (i) any income or loss
accounted for by the equity method of accounting (except in the case of
income to the extent of the amount of cash dividends or cash distributions
paid to the Parent Borrower or any Subsidiary by the entity accounted for
by the equity method of accounting), (j) (i) for any period ending on or
prior to December 25, 1999, $1,825,000 of insurance expense for each
fiscal quarter ending during such period (representing an annual saving of
$7,300,000 insurance expense after giving pro forma effect to the
<PAGE>
12
combination of the Acquired Business and the Parent Borrower) and (ii) for
any period ending thereafter, for each fiscal quarter ending on or prior
to December 25, 1999 included in such period, the annualized insurance
expense savings pro forma for such quarter, with such pro forma savings to
be calculated by the Parent Borrower and reviewed by
PricewaterhouseCoopers LLP based on annualization of actual savings on
insurance expense realized after December 25, 1999 and (k) up to the
Available Adjustment in respect of any cash expenses for (i) the
development and implementation of an e-commerce strategy and (ii) the
development and implementation of new information technology; provided
that for purposes of calculating EBITDA of the Parent Borrower and its
consolidated Subsidiaries for any period ending on or prior to December
29, 2000, the combined EBITDA of the Acquired Business during such period
shall be included on a pro forma basis for such period (assuming the
consummation of the Acquisition and the incurrence or assumption of any
Indebtedness in connection therewith occurred on the first day of such
period).
"ECF Percentage": 50%; provided, that with respect to any fiscal
year of the Parent Borrower ending on or after December 29, 2000, the ECF
Percentage shall be reduced to 0% if the Leverage Ratio as of the last day
of such fiscal year is less than 3.5 to 1.0.
"Effective Date": the time and date, on or before 3:00 p.m., New
York City time, on November 24, 1999, on which all the conditions
precedent set forth in subsection 6.1 shall be satisfied or waived.
"EMU": Economic and Monetary Union as contemplated in the Treaty.
"Environmental Costs": any and all costs or expenses (including,
without limitation, attorney's and consultant's fees, investigation and
laboratory fees, response costs, court costs and litigation expenses,
fines, penalties, damages, settlement payments, judgments and awards), of
whatever kind or nature, known or unknown, contingent or otherwise,
arising out of, or in any way relating to any violation of, noncompliance
with or liability under any Environmental Laws or any orders,
requirements, demands, or investigations of any person related to any
Environmental Laws. Environmental Costs include any and all of the
foregoing, without regard to whether they arise out of or are related to
any past, pending or threatened proceeding of any kind.
"Environmental Laws": any and all applicable foreign, federal,
state, local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements of any Governmental Authority
having the force and effect of law or other Requirements of Law
(including, without limitation, common law) regulating, relating to or
imposing liability or standards of conduct concerning protection of the
environment or human health as related to the environment, as now or at
any relevant time hereafter in effect.
"Equity Investors": CD&R Fund V, the CD&R Group, the Seller and its
Subsidiaries, the Management Investors and the other equity investors
arranged by CD&R and satisfactory to the Administrative Agent and the
Other Representatives.
<PAGE>
13
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Euro": the single currency of Participating Member States
introduced in accordance with the provisions of Article 109(1)4 of the
Treaty and, in respect of all payments to be made under this Agreement in
Euros, means immediately available, freely transferable funds.
"Eurocurrency Base Rate": with respect to each day during each
Interest Period pertaining to a Eurocurrency Loan, the rate per annum
determined by the Administrative Agent to be the arithmetic mean (rounded
to the nearest 1/100th of 1%) of the offered rates for deposits in Dollars
or in the applicable Designated Foreign Currency with a term comparable to
such Interest Period that appears on the Telerate British Bankers Assoc.
Interest Settlement Rates Page (as defined below) at approximately 11:00
A.M., London time, on the second full Business Day preceding the first day
of such Interest Period; provided, however, that if there shall at any
time no longer exist a Telerate British Bankers Assoc. Interest Settlement
Rates Page, "Eurocurrency Base Rate" shall mean, with respect to each day
during each Interest Period pertaining to a Eurocurrency Loan, the rate
per annum equal to the rate at which Chase is offered deposits in Dollars
or in the applicable Designated Foreign Currency at or about 10:00 A.M.,
New York City time, two Business Days prior to the beginning of such
Interest Period in the interbank eurocurrency market where the
eurocurrency and foreign currency and exchange operations in respect of
Dollars or such Designated Foreign Currency, as the case may be, are then
being conducted for delivery on the first day of such Interest Period for
the number of days comprised therein and in an amount comparable to the
amount of its Eurocurrency Loan to be outstanding during such Interest
Period. "Telerate British Bankers Assoc. Interest Settlement Rates Page"
shall mean the display designated as Page 3750 (or such other page on
which any Designated Foreign Currency then appears) on the Dow Jones
Market Service (or such other page as may replace such page for the
purpose of displaying the rates at which Dollar deposits or deposits in
any Designated Foreign Currency are offered by leading banks in the London
interbank deposit market).
"Eurocurrency Loans": Loans the rate of interest applicable to which
is based upon the Eurocurrency Rate.
"Eurocurrency Rate": with respect to each day during each Interest
Period pertaining to a Eurocurrency Loan, a rate per annum determined for
such day in accordance with the following formula (rounded upwards to the
nearest 1/100th of 1%):
Eurocurrency Base Rate
----------------------------------------
1.00 - Eurocurrency Reserve Requirements
"Eurocurrency Reserve Requirements": for any day as applied to a
Eurocurrency Loan, the aggregate (without duplication) of the rates
(expressed as a decimal fraction) of reserve requirements in effect on
such day (including, without limitation, basic, supplemental, marginal and
emergency reserves under any regulations of the Board or other
Governmental Authority having jurisdiction with respect thereto) dealing
with reserve requirements prescribed for
<PAGE>
14
eurocurrency funding (currently referred to as "Eurocurrency Liabilities"
in Regulation D of the Board) maintained by a member bank of the Federal
Reserve System.
"Event of Default": any of the acts, conditions or events specified
in Section 9, provided that any requirement for the giving of notice, the
lapse of time, or both, or any other condition, has been satisfied.
"Excess Cash Flow": for any period, EBITDA minus (i) any Capital
Expenditures made in cash during such period, minus (ii) any principal
payments (other than principal payments during such period pursuant to
subsection 4.4(c) or (d) unless and to the extent that the event giving
rise to such mandatory prepayment causes an increase in EBITDA) on the
Term Loans made during such period, minus (iii) any principal payments
resulting in a permanent reduction of any other Indebtedness of the Parent
Borrower or any of its consolidated Subsidiaries made during such period,
minus (iv) any portion of Consolidated Interest Expense for such period,
minus (v) any taxes paid or payable in cash during such period, minus (vi)
the Net Cash Proceeds from any Asset Sale to the extent that such Net Cash
Proceeds (A) (without duplication of clause (i) or (vii) of this
definition) consist of any Reinvested Amount or are otherwise applied in
accordance with subsection 4.4(c) and (B) are included in the calculation
of EBITDA, minus (vii) (without duplication of clause (i) of this
definition) any Investment made in accordance with subsection 8.9(e), (g),
(i), (l), (o), (p) or (q), minus (viii) the proceeds of any Sale and
Leaseback Transactions entered into by the Parent Borrower or any of its
Subsidiaries in accordance with subsection 8.12 during such period in the
ordinary course of its business to the extent included in EBITDA, minus
(ix) any earnings included in EBITDA for such period (except to the extent
that any such earnings are used for any purposes described in clauses (i)
through (viii) above) of a Receivables Subsidiary to the extent the terms
of any Permitted Receivables Securitization prohibit the distribution
thereof to the Parent Borrower or any of its other Subsidiaries, minus (x)
to the extent not otherwise subtracted from EBITDA in this definition of
"Excess Cash Flow", any cash dividends, and other loans and advances, made
during such period by the Parent Borrower or any of its Subsidiaries to
Holding, so long as such dividends, loans and advances are expressly
permitted by subsection 8.7, plus (xi) the Change in Consolidated Working
Capital for such period.
"Exchange Act": the Securities Exchange Act of 1934, as amended.
"Existing Credit Agreement": the Credit Agreement, dated as of March
30, 1998, among the Parent Borrower, the several banks and other financial
institutions from time to time parties thereto, The Bank of New York, as
syndication agent, and Chase, as collateral, documentation and
administrative agent.
"Existing Letters of Credit": at any time, the letters of credit
issued by Chase and listed or described on Schedule VII that are
outstanding on such date.
"Extension of Credit": as to any Lender, the making of a Loan by
such Lender or the issuance of, or participation in, a Letter of Credit by
such Lender.
<PAGE>
15
"Federal Funds Effective Rate": as defined in the definition of the
term "ABR" in this subsection 1.1.
"Final Maturity Date": November 18, 2007.
"Financing Lease": any lease of property, real or personal, the
obligations of the lessee in respect of which are required in accordance
with GAAP to be capitalized on a balance sheet of the lessee.
"FIRREA": the Financial Institutions Reform, Recovery and
Enforcement Act of 1989, as amended.
"Foreign Backstop Letters of Credit": any Standby Letter of Credit
issued to any Person for the account of the Parent Borrower or any Foreign
Subsidiary Borrower to provide credit support for Indebtedness of any
Foreign Subsidiary to such Person which is permitted under subsection 8.2.
"Foreign Subsidiary": any Subsidiary of Holding which is organized
and existing under the laws of any jurisdiction outside of the United
States of America or that is a Foreign Subsidiary Holdco.
"Foreign Subsidiary Borrower": any Foreign Subsidiary which is
listed as a Foreign Subsidiary Borrower on Schedule IV, as such schedule
may be amended from time to time pursuant to subsection 11.1(b)
(including, without limitation, the delivery of the documents required by
subsection 11.1(b)).
"Foreign Subsidiary Holdco": North American International Holding
Corporation, a Delaware corporation, and any other Subsidiary of the
Parent Borrower that has no material assets other than securities of one
or more Foreign Subsidiaries, and other assets relating to an ownership
interest in any such securities or Subsidiaries.
"Former Plan": any employee benefit plan in respect of which the
Parent Borrower or a Commonly Controlled Entity has engaged in a
transaction described in Section 4069 or Section 4212(c) of ERISA.
"GAAP": with respect to the covenants contained in subsections 8.1
and 8.8 and all defined terms relating thereto, generally accepted
accounting principles in the United States of America in effect on the
Effective Date and, for all other purposes under this Agreement, generally
accepted accounting principles in the United States of America in effect
from time to time.
"Governmental Authority": any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government, including, without limitation, the European
Union.
<PAGE>
16
"Guarantee and Collateral Agreement": the Guarantee and Collateral
Agreement to be executed and delivered by Holding, the Parent Borrower,
each Foreign Subsidiary Borrower listed on Schedule IV attached hereto,
each Domestic Subsidiary of the Parent Borrower listed on Schedule V
attached hereto and in existence on the Effective Date and the
Administrative Agent, substantially in the form of Exhibit B, as the same
may be amended, supplemented, waived or otherwise modified from time to
time.
"Guarantee Obligation": as to any Person (the "guaranteeing
person"), any obligation of (a) the guaranteeing person or (b) another
Person (including, without limitation, any bank under any letter of
credit) to induce the creation of which the guaranteeing person has issued
a reimbursement, counterindemnity or similar obligation, in either case
guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends
or other obligations (the "primary obligations") of any other third Person
(the "primary obligor") in any manner, whether directly or indirectly,
including, without limitation, any such obligation of the guaranteeing
person, whether or not contingent, (i) to purchase any such primary
obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the purchase or payment
of any such primary obligation or (2) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net
worth or solvency of the primary obligor, (iii) to purchase property,
securities or services primarily for the purpose of assuring the owner of
any such primary obligation of the ability of the primary obligor to make
payment of such primary obligation or (iv) otherwise to assure or hold
harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term Guarantee Obligation shall not
include (x) endorsements of instruments for deposit or collection in the
ordinary course of business or (y) the obligations of any Insurance
Subsidiary pursuant to insurance policies issued by such Insurance
Subsidiary in the ordinary course of its insurance business. The amount of
any Guarantee Obligation of any guaranteeing person shall be deemed to be
the lower of (a) an amount equal to the stated or determinable amount of
the primary obligation in respect of which such Guarantee Obligation is
made and (b) the maximum amount for which such guaranteeing person may be
liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for
which such guaranteeing person may be liable are not stated or
determinable, in which case the amount of such Guarantee Obligation shall
be such guaranteeing person's maximum reasonably anticipated liability in
respect thereof as determined by the Parent Borrower in good faith.
"Guarantees": the collective reference to the Guarantee and
Collateral Agreement and any other guarantee hereafter delivered to the
Administrative Agent (a copy of which will be provided to each Lender)
guaranteeing the obligations and liabilities of the Borrowers hereunder,
under any Interest Rate Protection Agreements entered into with any Lender
or any affiliate thereof, under any Notes and/or under any of the other
Loan Documents.
"Guarantor": any Person delivering a Guarantee pursuant to this
Agreement.
"Holding": as defined in the Recitals hereto.
<PAGE>
17
"Holding Loan": the loans, in an aggregate principal amount equal to
$40,000,000 and due on December 31, 1999, made on the date hereof to
Holding by the lenders party to the Holding Loan Agreement.
"Holding Loan Agreement": the Loan Agreement, dated as of the date
hereof, among Holding and the lenders party thereto.
"Holding Preferred Stock": Holding's Junior Exchangeable Preferred
Stock due 2010, as the terms of such Preferred Stock may be amended,
supplemented or otherwise modified from time to time in accordance with
Section 5.4.2 of the Guarantee and Collateral Agreement.
"Holding Senior Discount Note Indenture": the collective reference
to (a) the Loan Agreement, dated as of the date hereof, among Holding,
Blue Ridge Investments, LLC and an affiliate of Chase, providing for loans
in an aggregate principal amount equal to $35,000,000, (b) the indenture,
to be entered into by Holding and a trustee, in connection with the
issuance of Holding Senior Discount Notes in exchange for all or any
portion of the loans made pursuant to the Loan Agreement referred to in
clause (a), and (c) all instruments and other agreements entered into by
Holding in connection with the foregoing Loan Agreement and indenture, in
each case, as such Loan Agreement, indenture or other instrument or
agreement may be amended, supplemented or otherwise modified from time to
time in accordance with Section 5.4.2 of the Guarantee and Collateral
Agreement.
"Holding Senior Discount Notes": the collective reference to (a) the
loans made on the Effective Date pursuant to the Loan Agreement referred
to in clause (a) of the definition of "Holding Senior Discount Note
Indenture" and (b) the 16% Holding Senior Discount Notes due 2009 of
Holding issued on or after the Effective Date pursuant to the indenture
referred to in clause (b) of the definition of "Holding Senior Discount
Note Indenture".
"Holding Subordinated Exchange Debentures": the subordinated
exchange debentures of Holding to be issued upon the exchange in
accordance with Section 5.4.2 of the Guarantee and Collateral Agreement,
at Holding's option, of shares of Holding Preferred Stock, together with
all instruments and other agreements to be entered into by Holding in
connection therewith, in the form delivered to the Administrative Agent
pursuant to subsection 6.1(c), as the same may be amended, supplemented or
otherwise modified from time to time in accordance with Section 5.4.2 of
the Guarantee and Collateral Agreement.
"Indebtedness": of any Person at any date, (a) all indebtedness of
such Person for borrowed money or for the deferred purchase price of
property or services (other than trade liabilities incurred in the
ordinary course of business and payable in accordance with customary
practices), (b) any other indebtedness of such Person which is evidenced
by a note, bond, debenture or similar instrument, (c) all obligations of
such Person under Financing Leases, (d) all obligations of such Person in
respect of bankers' acceptances issued or created for the account of such
Person, (e) for purposes of subsection 8.2 and Section 9(e) only, all
obligations of such Person in respect of interest rate protection
agreements, interest rate futures, interest rate options, interest rate
caps and any other interest rate hedge arrangements, (f) for purposes of
<PAGE>
18
subsection 8.2 hereof and Section 5.4.2 of the Guarantee and Collateral
Agreement only, the Holding Preferred Stock, (g) for purposes of
subsection 8.2 only, all other preferred stock issued by such Person
which, pursuant to its terms, is subject to mandatory redemption,
retirement or acquisition by such Person on or prior to the Final Maturity
Date and which redemption, retirement or acquisition is not contingent on
any condition (other than the passage of time) yet to be satisfied and (h)
all indebtedness or obligations of the types referred to in the preceding
clauses (a) through (g) secured by any Lien on any property owned by such
Person even though such Person has not assumed or otherwise become liable
for the payment thereof.
"Indemnified Liabilities": as defined in subsection 11.5.
"Indentures": the collective reference to the Senior Subordinated
Note Indenture, the Holding Senior Discount Note Indenture and the Holding
Subordinated Exchange Debentures.
"Insolvency": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Insurance Subsidiaries": the collective reference to Baxendale,
TransGuard and NATIC.
"Intellectual Property": as defined in subsection 5.9.
"Interest Payment Date": (a) as to any ABR Loan, the last day of
each March, June, September and December to occur while such Loan is
outstanding, and the final maturity date of such Loan, (b) as to any
Eurocurrency Loan having an Interest Period of three months or less, the
last day of such Interest Period, and (c) as to any Eurocurrency Loan
having an Interest Period longer than three months, (x) each day which is
three months, or a whole multiple thereof, after the first day of such
Interest Period and (y) the last day of such Interest Period.
"Interest Period": with respect to any Eurocurrency Loan:
(i) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such
Eurocurrency Loan and ending one, two, three or six months
thereafter, as selected by the Parent Borrower in its notice of
borrowing or notice of conversion, as the case may be, given with
respect thereto; and
(ii) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such Eurocurrency Loan
and ending one, two, three or six months thereafter, as selected by
the Parent Borrower by irrevocable notice to the Administrative
Agent not less than three Business Days prior to the last day of the
then current Interest Period with respect thereto;
<PAGE>
19
provided that, all of the foregoing provisions relating to Interest
Periods are subject to the following:
(1) if any Interest Period would otherwise end on a day that
is not a Business Day, such Interest Period shall be extended to the
next succeeding Business Day unless the result of such extension
would be to carry such Interest Period into another calendar month
in which event such Interest Period shall end on the immediately
preceding Business Day;
(2) any Interest Period that would otherwise extend beyond the
Termination Date (in the case of the Tranche A Term Loans and the
Revolving Credit Loans) or beyond the Final Maturity Date (in the
case of the Tranche B Term Loans) shall (for all purposes other than
subsection 4.12) end on the Termination Date or the Final Maturity
Date, as the case may be;
(3) any 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) shall end on the last Business Day of a calendar month; and
(4) the Parent Borrower shall select Interest Periods so as
not to require a scheduled payment of any Eurocurrency Loan during
an Interest Period for such Loan.
"Interest Rate Protection Agreement": any interest rate protection
agreement, interest rate future, interest rate option, interest rate cap
or collar or other interest rate hedge arrangement with a financial
institution reasonably acceptable to the Administrative Agent and the
Syndication Agent, to or under which the Parent Borrower or any of the
Foreign Subsidiary Borrowers is a party or a beneficiary on the Effective
Date or becomes a party or a beneficiary after the Effective Date.
"Inventory": as defined in the Uniform Commercial Code as in effect
in the State of New York.
"Investment Company Act": the Investment Company Act of 1940, as
amended.
"Investments": as defined in subsection 8.9.
"Issuing Lender": Chase or any of its affiliates (including, without
limitation, Chase Manhattan Bank Delaware), in its capacity as issuer of
any Letter of Credit.
"Joinder Agreement": as defined in subsection 11.1(b)(i).
"L/C Fee Payment Date": with respect to any Letter of Credit, (a)
the last day of each March, June, September and December occurring after
the date of issuance thereof and prior to the expiration thereof and (b)
if such Letter of Credit is outstanding on such day, the last day of the
Revolving Credit Commitment Period.
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"L/C Obligations": at any time, an amount equal to the sum of (a)
the aggregate then undrawn and unexpired amount of the then outstanding
Letters of Credit (including, without limitation, in the case of
outstanding Letters of Credit in any Designated Foreign Currency, the
Dollar Equivalent of the aggregate then undrawn and unexpired amount
thereof) and (b) the aggregate amount of drawings under Letters of Credit
which have not then been reimbursed pursuant to subsection 3.5(a)
(including, without limitation, in the case of Letters of Credit in any
Designated Foreign Currency, the Dollar Equivalent of the unreimbursed
aggregate amount of drawings thereunder, to the extent that such amount
has not been converted into Dollars in accordance with subsection 3.5(a)).
"L/C Participants": the collective reference to all the Revolving
Credit Lenders other than the Issuing Lender.
"Lenders": as defined in the Preamble hereto.
"Letters of Credit": as defined in subsection 3.1(a).
"Leverage Ratio": at the last day of each fiscal quarter of the
Parent Borrower, the ratio of (a) Consolidated Total Funded
Indebtedness/Securitizations at such date to (b) EBITDA for the period of
four full fiscal quarters ending on such date.
"Lien": any mortgage, pledge, hypothecation, assignment, security
deposit arrangement, encumbrance, lien (statutory or other), charge or
other security interest or any preference, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title
retention agreement and any Financing Lease having substantially the same
economic effect as any of the foregoing).
"Loan": a Revolving Credit Loan, a Tranche A Term Loan, a Tranche B
Term Loan or a Swing Line Loan, as the context shall require;
collectively, the "Loans".
"Loan Documents": this Agreement, any Notes, the Applications, the
Guarantees, the Security Documents, the Syndication Letter Agreement and
any Joinder Agreement.
"Loan Parties": Holding, the Parent Borrower, each Foreign
Subsidiary Borrower and each other Subsidiary of the Parent Borrower which
is a party to a Loan Document; individually, a "Loan Party".
"Management Investors": the collective reference to the Agents and
the officers, directors, employees and managers of, or consultants to, the
Parent Borrower, Holding or any of their Subsidiaries, or family members
or relatives thereof or trusts for the benefit of any of the foregoing, or
any of their heirs, executors, successors or legal representatives, who at
any particular date shall beneficially own or have the right to acquire,
directly or indirectly, common stock of Holding.
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21
"Management Subscription Agreements": one or more stock
subscription, stock option, grant or other agreements which have been or
may be entered into between Holding and certain Management Investors, with
respect to the issuance to such parties of common stock of Holding or
options, warrants or other rights in respect of common stock of Holding,
any agreements entered into from time to time by transferees of any such
stock, options, warrants or other rights in connection with the sale,
transfer or reissuance thereof, and any assumptions of any of the
foregoing by third parties, as amended, supplemented, waived or otherwise
modified from time to time.
"Material Adverse Change": as defined in subsection 5.2(a).
"Material Adverse Effect": a material adverse effect on (a) the
business, operations, property, condition (financial or otherwise) or
prospects of Holding and the Subsidiaries taken as a whole or (b) the
validity or enforceability of this Agreement, any of the Notes or any of
the other Loan Documents taken as a whole or the rights and remedies of
the Administrative Agent and the Lenders under the Loan Documents taken as
a whole.
"Materials of Environmental Concern": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials, wastes, pollutants or
contaminants, defined or regulated as such in or under or which may give
rise to liability under any applicable Environmental Law, including,
without limitation, asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.
"Material Subsidiary": the collective reference to (a) any
Subsidiary of the Parent Borrower that had (i) total revenues of more than
$2,000,000 during the most recently completed period of four consecutive
fiscal quarters of Holding or (ii) total assets of more than $1,000,000 as
of the last day of such period, (b) FrontRunner Worldwide, Inc. and (c)
Relocation Management Systems, Inc.
"Moody's": as defined in the definition of the term "Cash
Equivalents" in this subsection 1.1.
"Mortgages": each of the mortgages to be executed and delivered by
the Parent Borrower and its Subsidiaries substantially in the form of
Exhibit E, as the same may be amended, supplemented, waived or otherwise
modified from time to time.
"MSS": Manufacturing Support Services, L.L.C., a Delaware limited
liability company and a Subsidiary of the Parent Borrower.
"Multiemployer Plan": a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"NATIC": North American Transport Insurance Company, an Indiana
corporation and a Wholly Owned Subsidiary of the Parent Borrower.
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"Net Cash Proceeds": with respect to any Asset Sale (including any
Sale and Leaseback Transaction permitted under subsection 8.12), any
issuance of any debt securities or any borrowings by Holding or any of its
Subsidiaries (other than issuances and borrowings permitted pursuant to
subsection 8.2 hereof and Section 5.4.2 of the Guarantee and Collateral
Agreement), any Permitted Receivables Securitization, an amount equal to
the gross proceeds in cash and Cash Equivalents of such Asset Sale, sale,
issuance, borrowing or Permitted Receivables Securitization, net of (i)
reasonable attorneys' fees, accountants' fees, brokerage, consultant and
other customary fees, underwriting commissions and other reasonable fees
and expenses actually incurred in connection with such Asset Sale, sale,
issuance, borrowing or Permitted Receivables Securitization, (ii) taxes
paid or reasonably estimated to be payable as a result thereof, (iii)
appropriate amounts provided or to be provided by Holding or any of its
Subsidiaries as a reserve, in accordance with GAAP, against any
liabilities associated with such Asset Sale and retained by Holding or any
such Subsidiary after such Asset Sale and other appropriate amounts to be
used by Holding or any of its Subsidiaries to discharge or pay on a
current basis any other liabilities associated with such Asset Sale, (iv)
in the case of a sale or Sale and Leaseback Transaction of or involving an
asset subject to a Lien securing any Indebtedness, payments made and
installment payments required to be made to repay such Indebtedness,
including payments in respect of principal, interest and prepayment
premiums and penalties and (v) in the case of any Permitted Receivables
Securitization, any escrowed or pledged cash proceeds which effectively
secure, or are required to be maintained as reserves by the applicable
Receivables Subsidiary for, the Indebtedness of the Parent Borrower and
its Subsidiaries in respect of, or the obligations of the Parent Borrower
and its Subsidiaries under, such Permitted Receivables Securitization.
"New York Process Agent": as defined in subsection 11.12(b).
"Non-Excluded Taxes": as defined in subsection 4.11.
"Notes": the collective reference to the Revolving Credit Notes, the
Swing Line Note, the Tranche A Term Notes and the Tranche B Term Notes.
"Obligor": any purchaser of goods or services or other Person
obligated to make payment to the Parent Borrower or a Subsidiary in
respect of a purchase of such goods or services.
"Other Representatives": the Arrangers, the Syndication Agent, the
Documentation Agent and the Issuing Lender, in their respective capacities
as such.
"Owner/Operators": individuals who are retained by the Parent
Borrower or any of its Subsidiaries as independent contractors and who own
and drive their own tractors on behalf of the Parent Borrower or any of
its Subsidiaries.
"Parent Borrower": as defined in the Preamble hereto.
"Participants": as defined in subsection 11.6(b).
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23
"Participating Member State": each state so described in any EMU
legislation.
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA (or any successor thereto).
"Permitted Hedging Arrangement": any agreement or arrangement
relating to currency, commodity or other hedging, to the extent and only
to the extent that such agreement or arrangement is entered into,
purchased or otherwise acquired in the ordinary course of business of the
Parent Borrower or any of its Subsidiaries, and not for purposes of
speculation, with (i) any Lender or any affiliate of any Lender or (ii)
any other reputable financial institution that is rated at least A by S&P
or A2 by Moody's.
"Permitted Receivables Securitization": any transaction or series of
related transactions providing for the securitization of any Receivables;
provided that any such transaction shall be consummated (i) on terms that
include terms substantially as described on Schedule VI or as the Required
Lenders may otherwise consent, such consent not to be unreasonably
withheld, and (ii) pursuant to documentation in form and substance
reasonably satisfactory to the Administrative Agent, as evidenced by its
written approval thereof.
"Person": an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of
whatever nature.
"Plan": any employee benefit plan which is covered by ERISA and in
respect of which the Parent Borrower or a Commonly Controlled Entity is an
"employer" as defined in Section 3(5) of ERISA.
"Preferred Stock Certificates of Designation": the Certificate of
Designation relating to the Holding Preferred Stock, as the terms of such
Certificate of Designation may be amended, supplemented or otherwise
modified from time to time in accordance with Section 5.4.2 of the
Guarantee and Collateral Agreement.
"Prepayment Date": as defined in subsection 4.4(g).
"Prepayment Option Notice": as defined in subsection 4.4(g).
"Prime Rate": as defined in the definition of the term "ABR" in this
subsection 1.1.
"Pro Forma Date": as defined in subsection 5.1(c).
"Pro Forma Financial Statements": as defined in subsection 5.1(c).
"Properties": as defined in subsection 5.18(a).
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24
"Receivables": all Accounts and accounts receivable of the Parent
Borrower or any of its Subsidiaries (including any thereof constituting or
evidenced by chattel paper, instruments or general intangibles), and all
proceeds thereof and rights (contractual and other) and collateral related
thereto.
"Receivables Subsidiary": any special purpose, bankruptcy-remote
Subsidiary that purchases, on a revolving basis, Receivables generated by
the Parent Borrower or any of its Subsidiaries.
"Refunded Swing Line Loans": as defined in subsection 2.5(c).
"Register": as defined in subsection 11.6(d).
"Regulation D": Regulation D of the Board as in effect from time to
time.
"Regulation T": Regulation T of the Board as in effect from time to
time.
"Regulation U": Regulation U of the Board as in effect from time to
time.
"Regulation X": Regulation X of the Board as in effect from time to
time.
"Reimbursement Obligations": the obligation of the Borrowers to
reimburse the Issuing Lender pursuant to subsection 3.5(a) for amounts
drawn under Letters of Credit.
"Reinvested Amount": with respect to any Asset Sale, that portion of
the Net Cash Proceeds thereof as shall, according to a certificate of a
Responsible Officer delivered to the Administrative Agent on the date of
such Asset Sale, be reinvested in the business of the Parent Borrower and
its Subsidiaries within 180 days of the receipt of such Net Cash Proceeds;
provided that any Net Cash Proceeds not so reinvested by such 180th day
shall be utilized on such day to prepay the Loans pursuant to subsection
4.4(c).
"Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of
Section 4241 of ERISA.
"Reportable Event": any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the thirty day notice period
is waived under subsection .22, .23, .25, .27 or .28 of PBGC Reg. ss.4043
or any successor regulation thereto.
"Required Lenders": at any time, Lenders the Total Credit
Percentages of which aggregate at least 51%.
"Required Release Lenders": at any time, (i) Revolving Credit
Lenders and Tranche A Term Loan Lenders the Total Credit Percentages
(calculated for this purpose without reference to outstanding Tranche B
Term Loans) of which aggregate at least 51%, (ii) Tranche B Term Loan
Lenders the Tranche B Term Loan Percentages of which aggregate at least
51% and (iii) Lenders the Total Credit Percentages of which aggregate at
least 80%.
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"Requirement of Law": as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents
of such Person, and any law, statute, ordinance, code, decree, treaty,
rule or regulation or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such
Person or any of its material property or to which such Person or any of
its material property is subject; provided that the foregoing shall not
apply to any non-binding recommendation of any Governmental Authority.
"Responsible Officer": as to any Person, any of the following
officers of such Person: (i) the chief executive officer or the president
of such Person and, with respect to financial matters, the chief financial
officer, the treasurer or the controller of such Person, (ii) any vice
president of such Person or, with respect to financial matters, any
assistant treasurer or assistant controller of such Person, who has been
designated in writing to the Administrative Agent as a Responsible Officer
by such chief executive officer or president of such Person or, with
respect to financial matters, such chief financial officer of such Person,
(iii) with respect to subsection 7.7 and without limiting the foregoing,
the general counsel of such Person and (iv) with respect to ERISA related
matters, the vice president of human resources of such Person.
"Revolving Credit Commitment": as to any Revolving Credit Lender,
its obligation to make Revolving Credit Loans to, and/or make or
participate in Swing Line Loans made to, and/or issue or participate in
Letters of Credit issued on behalf of, the Borrowers in an aggregate
amount not to exceed at any one time outstanding the amount set forth
opposite such Revolving Credit Lender's name in Schedule I under the
heading "Revolving Credit Commitment" or, in the case of any Lender that
is an Assignee, the amount of the assigning Lender's Revolving Credit
Commitment assigned to such Assignee pursuant to subsection 11.6(c) (in
each case as such amount may be adjusted from time to time as provided
herein); collectively, as to all the Revolving Credit Lenders, the
"Revolving Credit Commitments".
"Revolving Credit Commitment Percentage": as to any Revolving Credit
Lender, the percentage of the aggregate Revolving Credit Commitments
constituted by its Revolving Credit Commitment (or, if the Revolving
Credit Commitments have terminated or expired, the percentage which (i)
the sum of (a) such Lender's then outstanding Revolving Credit Loans plus
(b) such Lender's interests in the aggregate L/C Obligations and Swing
Line Loans then outstanding then constitutes of (ii) the sum of (a) the
aggregate Revolving Credit Loans of all the Revolving Credit Lenders then
outstanding plus (b) the aggregate L/C Obligations and Swing Line Loans
then outstanding).
"Revolving Credit Commitment Period": the period from and including
the Effective Date to but not including the Termination Date, or such
earlier date as the Revolving Credit Commitments shall terminate as
provided herein.
"Revolving Credit Lender": any Lender having a Revolving Credit
Commitment hereunder or having a Revolving Credit Loan outstanding
hereunder.
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"Revolving Credit Loans": as defined in subsection 2.1.
"Revolving Credit Note": as defined in subsection 2.2.
"Sale and Leaseback Transaction": as defined in subsection 8.12.
"Securities Act": the Securities Act of 1933, as amended.
"Security Documents": the collective reference to the Mortgages, the
Guarantee and Collateral Agreement and all other similar security
documents hereafter delivered to the Administrative Agent on behalf of the
Lenders (and the Administrative Agent will provide each Lender with a copy
thereof) granting a Lien on any asset or assets of any Person to secure
the obligations and liabilities of the Borrowers hereunder, under any
Notes and/or under any of the other Loan Documents or to secure any
guarantee of any such obligations and liabilities.
"Seller": as defined in the Recitals hereto.
"Senior Debt Ratio": at the last day of each fiscal quarter of the
Parent Borrower, the ratio of (a) Consolidated Senior Debt at such date to
(b) EBITDA for the period of four full fiscal quarters ending on such
date.
"Senior Subordinated Note Indenture": the Indenture, dated as of
November 19, 1999, entered into by the Parent Borrower and State Street
Bank and Trust Company, as trustee, in connection with the issuance of the
Senior Subordinated Notes, together with all instruments and other
agreements entered into by the Parent Borrower in connection therewith, as
the same may be amended, supplemented or otherwise modified from time to
time in accordance with subsection 8.17.
"Senior Subordinated Notes": up to $150,000,000 aggregate principal
amount of 13-3/8% Senior Subordinated Notes due 2009 of the Parent
Borrower issued on the Effective Date pursuant to the Senior Subordinated
Note Indenture.
"Single Employer Plan": any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan.
"Solvent" and "Solvency": with respect to any Person on a particular
date, the condition that, on such date, (a) the fair value of the property
of such Person is greater than the total amount of liabilities, including,
without limitation, contingent liabilities, of such Person, (b) the
present fair salable value of the assets of such Person is not less than
the amount that will be required to pay the probable liability of such
Person on its debts as they become absolute and matured, (c) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and
liabilities mature, and (d) such Person is not engaged in business or a
transaction, and is not about to engage in business or a transaction, for
which such Person's property would constitute an unreasonably small amount
of capital.
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27
"S&P": as defined in the definition of the term "Cash Equivalents"
in this subsection 1.1.
"Spot Rate of Exchange": with respect to any Designated Foreign
Currency, at any date of determination thereof, the spot rate of exchange
in London that appears on the display page applicable to such Designated
Foreign Currency on the Dow Jones Market Service (or such other page as
may replace such page for the purpose of displaying the spot rate of
exchange in London); provided that if there shall at any time no longer
exist such a page, the spot rate of exchange shall be determined by
reference to another similar rate publishing service selected by the
Administrative Agent and, if no such similar rate publishing service is
available, by reference to the published rate of the Administrative Agent
in effect at such date for similar commercial transactions.
"Standby Letter of Credit": as defined in subsection 3.1(a).
"Subordinated Debt": any unsecured Indebtedness of Holding or any of
its Subsidiaries (a) having no scheduled principal payments (whether by
way of mandatory sinking fund, mandatory redemption, mandatory prepayment
or otherwise) prior to the Final Maturity Date and (b) the payment of the
principal of and interest on which and other obligations of Holding and
its Subsidiaries in respect thereof are subordinated, on terms and
conditions reasonably satisfactory to the Administrative Agent (as
evidenced by its prior written approval) in light of the terms and
conditions customarily contained in indentures for publicly issued high
yield subordinated debt securities, to the prior payment in full of the
principal of and interest (including post-petition interest) on the Loans
and all other payment obligations of the Loan Parties to the
Administrative Agent, the Other Representatives and the Lenders hereunder
and under the other Loan Documents.
"Subordinated Subsidiary Guarantees": the subordinated guarantees
delivered by the Subsidiaries of the Parent Borrower guaranteeing the
obligations and liabilities of the Parent Borrower in respect of the
Senior Subordinated Notes.
"Subsidiary": as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such
other ownership interests having such power only by reason of the
happening of a contingency) to elect a majority of the board of directors
or other managers of such corporation, partnership, limited liability
company or other entity are at the time owned, or the management of which
is otherwise controlled, directly or indirectly through one or more
intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall
refer to a Subsidiary or Subsidiaries of Holding.
"Swing Line Commitment": the Swing Line Lender's obligation to make
Swing Line Loans pursuant to subsection 2.5.
"Swing Line Lender": Chase, in its capacity as provider of the Swing
Line Loans.
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"Swing Line Loan Participation Certificate": a certificate in
substantially the form of Exhibit I.
"Swing Line Loans": as defined in subsection 2.5(a).
"Swing Line Note": as defined in subsection 2.5(b).
"Syndication Agent": as defined in the Preamble hereto.
"Syndication Letter Agreement": the letter agreement, dated as of
November 19, 1999, between the Parent Borrower, the Administrative Agent,
the Syndication Agent and the Arrangers relating to the syndication of the
credit facilities provided for in this Agreement.
"Telerate British Bankers Assoc. Interest Settlement Rates Page": as
defined in the definition of the term "Eurocurrency Base Rate" in this
subsection 1.1.
"Termination Date": November 18, 2006.
"Term Loan": a Tranche A Term Loan or a Tranche B Term Loan, as the
context shall require; collectively, the "Term Loans".
"Term Loan Lender": any Lender having a Term Loan outstanding
hereunder.
"Term Note": a Tranche A Term Note or a Tranche B Term Note, as the
context shall require; collectively, the "Term Notes".
"Three-Month Secondary CD Rate": as defined in the definition of the
term "ABR" in this subsection 1.1.
"Title Insurance Company": the title insurance company issuing the
policies referred to in subsection 6.1(p).
"Total Credit Percentage": as to any Lender at any time, the
percentage of the aggregate Revolving Credit Commitments, outstanding
Tranche A Term Loans and outstanding Tranche B Term Loans then constituted
by its Revolving Credit Commitment, outstanding Tranche A Term Loan and
outstanding Tranche B Term Loan (or, if the Revolving Credit Commitments
have terminated or expired, the percentage of the aggregate outstanding
Revolving Credit Loans, outstanding Term Loans and interests in the
outstanding L/C Obligations and Swing Line Loans then constituted by its
outstanding Revolving Credit Loans, outstanding Term Loans and interests
in outstanding L/C Obligations and Swing Line Loans).
"Tranche": the collective reference to Eurocurrency Loans, the then
current Interest Periods with respect to all of which begin on the same
date and end on the same later date (whether or not such Loans shall
originally have been made on the same day).
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29
"Tranche A Term Loan": as defined in subsection 2.6.
"Tranche A Term Loan Lender": any Term Loan Lender having a Tranche
A Term Loan outstanding hereunder.
"Tranche A Term Loan Percentage": as to any Term Loan Lender at any
time, the percentage which (i) such Term Loan Lender's Tranche A Term Loan
then outstanding constitutes of (ii) the aggregate Tranche A Term Loans of
all the Term Loan Lenders then outstanding.
"Tranche A Term Note": as defined in subsection 2.7(a).
"Tranche B Prepayment Amount": as defined in subsection 4.4(g).
"Tranche B Term Loan": as defined in subsection 2.6.
"Tranche B Term Loan Lender": any Term Loan Lender having a Tranche
B Term Loan outstanding hereunder.
"Tranche B Term Loan Percentage": as to any Term Loan Lender at any
time, the percentage which (i) such Term Loan Lender's Tranche B Term Loan
then outstanding constitutes of (ii) the aggregate Tranche B Term Loans of
all the Term Loan Lenders then outstanding.
"Tranche B Term Note": as defined in subsection 2.8(a).
"Transaction Documents": the collective reference to the Acquisition
Agreement, the Preferred Stock Certificate of Designation and the
Indentures.
"Transferee": as defined in subsection 11.6(f).
"TransGuard": TransGuard Insurance Company of America, an Illinois
corporation and a Wholly Owned Subsidiary of the Parent Borrower.
"Treaty": the Treaty establishing the European Economic Community,
being the Treaty of Rome of March 25, 1957 as amended by the Single
European Act 1986 and the Maastricht Treaty (which was signed on February
7, 1992 and came into force on November 1, 1993) and as may, from time to
time, be further amended, supplemented or otherwise modified.
"Type": as to any Loan, its nature as an ABR Loan or a Eurocurrency
Loan.
"Underfunding": an excess of all accrued benefits under a Plan
(based on those assumptions used to fund such Plan), determined as of the
most recent annual valuation date, over the value of the assets of such
Plan allocable to such accrued benefits.
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30
"Uniform Customs": the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce Publication No.
500, as the same may be amended from time to time.
"U.S. Tax Compliance Certificate": as defined in subsection 4.11(b).
"Voting Stock": as defined in the definition of the term "Change of
Control" in this subsection 1.1.
"Wholly Owned Subsidiary": as to any Person, any Subsidiary of such
Person of which such Person owns, directly or indirectly through one or
more Wholly Owned Subsidiaries, all of the Capital Stock of such
Subsidiary other than directors qualifying shares or shares held by
nominees.
1.2 Other Definitional Provisions. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in any Notes, any other Loan Document or any certificate or other
document made or delivered pursuant hereto.
(b) As used herein and in any Notes and any other Loan Document, and
any certificate or other document made or delivered pursuant hereto or thereto,
accounting terms relating to Holding and its Subsidiaries not defined in
subsection 1.1 and accounting terms partly defined in subsection 1.1, to the
extent not defined, shall have the respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
subsection, Schedule and Exhibit references are to this Agreement unless
otherwise specified. The phrase "the date hereof" and phrases of similar import
when used in this Agreement shall refer to November 19, 1999.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(e) In the event that the Parent Borrower changes its fiscal year
end to the last day of December, each of the fiscal quarter ending dates set
forth herein (including, without limitation, those set forth in Sections 2.7 and
2.8) occurring after such change shall be deemed to be the last day of March,
June, September or December, as applicable.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Revolving Credit Commitments. (a) Subject to the terms and
conditions hereof, each Revolving Credit Lender severally agrees to make
revolving credit loans ("Revolving Credit Loans") to each of the Borrowers from
time to time during the Revolving Credit Commitment Period in an aggregate
principal amount at any one time outstanding which, when added to such Revolving
Credit
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31
Lender's Revolving Credit Commitment Percentage of the sum of the then
outstanding L/C Obligations and the then outstanding Swing Line Loans, does not
exceed the amount of such Revolving Credit Lender's Revolving Credit Commitment
then in effect; provided that no Revolving Credit Lender shall make any
Revolving Credit Loan in any Designated Foreign Currency if, after giving effect
to the making of such Revolving Credit Loan, the sum of the Dollar Equivalent of
the then outstanding Revolving Credit Loans in any Designated Foreign Currency
and the then outstanding L/C Obligations in respect of any Foreign Backstop
Letters of Credit would exceed an amount to be agreed upon by the Parent
Borrower, the Administrative Agent and the Other Representatives (it being
understood and agreed that the Administrative Agent shall calculate the Dollar
Equivalent of the then outstanding Revolving Credit Loans in any Designated
Foreign Currency and, to the extent applicable, of the then outstanding L/C
Obligations in respect of any Foreign Backstop Letters of Credit on the date on
which the Parent Borrower has given the Administrative Agent a notice of
borrowing with respect to any Revolving Credit Loan for purposes of determining
compliance with this subsection). During the Revolving Credit Commitment Period
each of the Borrowers may use the Revolving Credit Commitments by borrowing,
prepaying the Revolving Credit Loans in whole or in part, and reborrowing, all
in accordance with the terms and conditions hereof. In no event shall the
Revolving Credit Commitments of all Revolving Credit Lenders exceed
$150,000,000.
(b) The Revolving Credit Loans may be made in Dollars or any
Designated Foreign Currency and may from time to time be (i) Eurocurrency Loans,
(ii) ABR Loans or (iii) a combination thereof, as determined by the Parent
Borrower and notified to the Administrative Agent in accordance with subsections
2.3 and 4.2, provided that no Revolving Credit Loan shall be made as a
Eurocurrency Loan after the day that is one month prior to the Termination Date.
2.2 Revolving Credit Notes. Each of the Borrowers agrees that, upon
the request to the Administrative Agent by any Revolving Credit Lender made on
or prior to the Effective Date or in connection with any assignment of its Loan
or Revolving Credit Commitment, in order to evidence such Revolving Credit
Lender's Revolving Credit Loans such Borrower will execute and deliver to such
Revolving Credit Lender a promissory note substantially in the form of Exhibit
A-1, with appropriate insertions as to payee, date and principal amount (each,
as amended, supplemented, replaced or otherwise modified from time to time, a
"Revolving Credit Note"), payable to the order of such Revolving Credit Lender
and in a principal amount equal to the lesser of (a) the amount set forth
opposite such Revolving Credit Lender's name in Schedule I under the heading
"Revolving Credit Commitment" and (b) the aggregate unpaid principal amount of
all Revolving Credit Loans made by such Revolving Credit Lender to such
Borrower. Each Revolving Credit Note shall (x) be dated the Effective Date, (y)
be stated to mature on the Termination Date and (z) provide for the payment of
interest in accordance with subsection 4.1.
2.3 Procedure for Revolving Credit Borrowing. Each of the Borrowers
may borrow under the Revolving Credit Commitments during the Revolving Credit
Commitment Period on any Business Day, provided that the Parent Borrower (on
behalf of itself or such other Borrower, as the case may be) shall give the
Administrative Agent irrevocable notice (which notice must be received by the
Administrative Agent prior to (a) 12:30 P.M., New York City time, at least three
Business Days prior to the requested Borrowing Date, if all or any part of the
requested Revolving Credit Loans are to be initially Eurocurrency Loans made in
Dollars, (b) 11:00 A.M., London time, at least three Business
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32
Days prior to the requested Borrowing Date, if all or any part of the requested
Revolving Credit Loans are to be initially Eurocurrency Loans made in any
Designated Foreign Currency, or (c) 12:30 P.M., New York City time, at least one
Business Day prior to the requested Borrowing Date, otherwise), specifying (i)
the identity of the Borrower, (ii) the amount to be borrowed, (iii) the
requested Borrowing Date, (iv) whether the borrowing is to be of Eurocurrency
Loans, ABR Loans or a combination thereof and (v) if the borrowing is to be
entirely or partly of Eurocurrency Loans, the respective amounts of each such
Type of Loan, the respective lengths of the initial Interest Periods therefor
and, if the Eurocurrency Loans in respect of such borrowing are to be made
entirely or partly in any Designated Foreign Currency, the Designated Foreign
Currency thereof. Each borrowing under the Revolving Credit Commitments shall be
in an amount equal to (x) in the case of ABR Loans, except any ABR Loan to be
used solely to pay a like amount of outstanding Reimbursement Obligations or
Swing Line Loans, $5,000,000 or a whole multiple of $1,000,000 in excess thereof
(or, if the then Available Revolving Credit Commitments are (A) less than
$5,000,000, $1,000,000 or a whole multiple thereof or (B) less than $1,000,000,
such lesser amount) and (y) in the case of Eurocurrency Loans (or, in the case
of Eurocurrency Loans to be made in any Designated Foreign Currency, the Dollar
Equivalent of the principal amount thereof shall be in an amount equal to),
$5,000,000 or a whole multiple of $1,000,000 in excess thereof. Upon receipt of
any such notice from the Parent Borrower, the Administrative Agent shall
promptly notify each Revolving Credit Lender thereof. Notwithstanding the
foregoing, the initial borrowing of Revolving Credit Loans on the Effective Date
shall be in a maximum aggregate principal amount of $65,000,000. Subject to the
satisfaction of the conditions precedent specified in subsection 6.2 (and
subsection 6.3 in the case of a Foreign Subsidiary Borrower), each Revolving
Credit Lender will make the amount of its pro rata share of each borrowing of
Revolving Credit Loans available to the Administrative Agent for the account of
the Borrower identified in such notice at the office of the Administrative Agent
specified in subsection 11.2 prior to 12:00 Noon (10:00 A.M. in the case of the
initial borrowing hereunder), New York City time, or at such other office of the
Administrative Agent or at such other time as to which the Administrative Agent
shall notify such Revolving Credit Lender and the Parent Borrower reasonably in
advance of the Borrowing Date with respect thereto, on the Borrowing Date
requested by the Parent Borrower in Dollars or the applicable Designated Foreign
Currency and in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower identified in such notice
by the Administrative Agent crediting the account of the such Borrower on the
books of such office with the aggregate of the amounts made available to the
Administrative Agent by the Revolving Credit Lenders and in like funds as
received by the Administrative Agent.
2.4 Termination or Reduction of Revolving Credit Commitments. The
Parent Borrower shall have the right, upon not less than three Business Days'
notice to the Administrative Agent (which will promptly notify the Lenders
thereof), to terminate the Revolving Credit Commitments or, from time to time,
to reduce the amount of the Revolving Credit Commitments; provided that no such
termination or reduction shall be permitted if, after giving effect thereto and
to any prepayments of the Revolving Credit Loans and Swing Line Loans made on
the effective date thereof, the aggregate principal amount of the Revolving
Credit Loans then outstanding (including, without limitation, in the case of
Revolving Credit Loans then outstanding in any Designated Foreign Currency, the
Dollar Equivalent of the aggregate principal amount thereof), when added to the
sum of the then outstanding L/C Obligations and the then outstanding Swing Line
Loans, would exceed the Revolving Credit Commitments then in
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33
effect. Any such reduction shall be in an amount equal to $1,000,000 or a whole
multiple of $1,000,000 in excess thereof and shall reduce permanently the
Revolving Credit Commitments then in effect.
2.5 Swing Line Commitments. (a) Subject to the terms and conditions
hereof, the Swing Line Lender agrees to make swing line loans (individually, a
"Swing Line Loan"; collectively, the "Swing Line Loans") to each of the
Borrowers from time to time during the Revolving Credit Commitment Period in an
aggregate principal amount as to all of the Borrowers at any one time
outstanding not to exceed $10,000,000, provided that at no time may the sum of
the then outstanding Swing Line Loans, Revolving Credit Loans (including,
without limitation, in the case of Revolving Credit Loans then outstanding in
any Designated Foreign Currency, the Dollar Equivalent of the aggregate
principal amount thereof) and L/C Obligations exceed the Revolving Credit
Commitments then in effect. Amounts borrowed by any of the Borrowers under this
subsection 2.5 may be repaid and, through but excluding the Termination Date,
reborrowed. All Swing Line Loans shall be made as ABR Loans and shall not be
entitled to be converted into Eurocurrency Loans. The Parent Borrower (on behalf
of itself or such other Borrower, as the case may be) shall give the Swing Line
Lender irrevocable notice (which notice must be received by the Swing Line
Lender prior to 12:00 Noon, New York City time) on the requested Borrowing Date
specifying (i) the identity of the Borrower and (ii) the amount of the requested
Swing Line Loan which shall be in a minimum amount of $500,000 or whole
multiples of $100,000 in excess thereof. The proceeds of the Swing Line Loan
will be made available by the Swing Line Lender to the Borrower identified in
such notice at the office of the Swing Line Lender by crediting the account of
such Borrower at such office with such proceeds in Dollars.
(b) Each of the Borrowers agrees that, upon the request to the
Administrative Agent by the Swing Line Lender, in order to evidence the Swing
Line Loans such Borrower will execute and deliver to the Swing Line Lender a
promissory note substantially in the form of Exhibit A-4, with appropriate
insertions (as the same may be amended, supplemented, replaced or otherwise
modified from time to time, the "Swing Line Note"), payable to the order of the
Swing Line Lender and representing the obligation of such Borrower to pay the
amount of the Swing Line Commitment or, if less, the unpaid principal amount of
the Swing Line Loans made to such Borrower, with interest thereon as prescribed
in subsection 4.1. The Swing Line Note shall (a) be dated the Effective Date,
(b) be stated to mature on the Termination Date and (c) provide for the payment
of interest in accordance with subsection 4.1.
(c) The Swing Line Lender, at any time in its sole and absolute
discretion may, and, at any time as there shall be a Swing Line Loan outstanding
for more than seven Business Days, the Swing Line Lender shall, on behalf of the
Borrower to which such Swing Line Loan shall have been made (which hereby
irrevocably directs and authorizes the Swing Line Lender to act on its behalf),
request each Revolving Credit Lender, including the Swing Line Lender, to make a
Revolving Credit Loan as an ABR Loan in an amount equal to such Revolving Credit
Lender's Revolving Credit Commitment Percentage of the principal amount of the
Swing Line Loans (the "Refunded Swing Line Loans") outstanding on the date such
notice is given; provided that the provisions of this subsection shall not
affect the obligations of any of the Borrowers to prepay Swing Line Loans in
accordance with the provisions of subsection 4.4(e). Unless the Revolving Credit
Commitments shall have expired or terminated (in which event the procedures of
paragraph (d) of this subsection 2.5 shall apply), each Revolving Credit Lender
will make the proceeds of its Revolving Credit Loan available to the
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34
Administrative Agent for the account of the Swing Line Lender at the office of
the Administrative Agent prior to 12:00 Noon, New York City time, in funds
immediately available on the Business Day next succeeding the date such notice
is given. The proceeds of such Revolving Credit Loans shall be immediately
applied to repay the Refunded Swing Line Loans.
(d) If the Revolving Credit Commitments shall expire or terminate at
any time while Swing Line Loans are outstanding, each Revolving Credit Lender
shall, at the option of the Swing Line Lender exercised reasonably, either (i)
notwithstanding the expiration or termination of the Revolving Credit
Commitments, make a Revolving Credit Loan as an ABR Loan or (ii) purchase an
undivided participating interest in such Swing Line Loans, in either case in an
amount equal to such Revolving Credit Lender's Revolving Credit Commitment
Percentage determined on the date of, and immediately prior to, expiration or
termination of the Revolving Credit Commitments of the aggregate principal
amount of such Swing Line Loans. Each Revolving Credit Lender will make the
proceeds of any Revolving Credit Loan made pursuant to the immediately preceding
sentence available to the Administrative Agent for the account of the Swing Line
Lender at the office of the Administrative Agent prior to 12:00 Noon, New York
City time, in funds immediately available on the Business Day next succeeding
the date on which the Revolving Credit Commitments expire or terminate. The
proceeds of such Revolving Credit Loans shall be immediately applied to repay
the Swing Line Loans outstanding on the date of termination or expiration of the
Revolving Credit Commitments. In the event that the Revolving Credit Lenders
purchase undivided participating interests pursuant to the first sentence of
this paragraph (d), each Revolving Credit Lender shall immediately transfer to
the Swing Line Lender, in immediately available funds, the amount of its
participation and upon receipt thereof the Swing Line Lender will deliver to
such Revolving Credit Lender a Swing Line Loan Participation Certificate dated
the date of receipt of such funds and in such amount.
(e) Whenever, at any time after the Swing Line Lender has received
from any Revolving Credit Lender such Revolving Credit Lender's participating
interest in a Swing Line Loan, the Swing Line Lender receives any payment on
account thereof, the Swing Line Lender will distribute to such Revolving Credit
Lender its participating interest in such amount (appropriately adjusted, in the
case of interest payments, to reflect the period of time during which such
Revolving Credit Lender's participating interest was outstanding and funded);
provided, however, that in the event that such payment received by the Swing
Line Lender is required to be returned, such Revolving Credit Lender will return
to the Swing Line Lender any portion thereof previously distributed by the Swing
Line Lender to it.
2.6 Term Loans. Subject to the terms and conditions hereof, each
Term Loan Lender severally agrees (a) to make a term loan (a "Tranche A Term
Loan") to the Parent Borrower on the Effective Date in an aggregate principal
amount set forth opposite such Term Loan Lender's name in Schedule I under the
heading "Tranche A Term Loan Commitment" and (b) to make a term loan (a "Tranche
B Term Loan") to the Parent Borrower on the Effective Date in an aggregate
principal amount set forth opposite such Term Loan Lender's name in Schedule I
under the heading "Tranche B Term Loan Commitment". The Term Loans may be made
in Dollars and may from time to time be (a) Eurocurrency Loans, (b) ABR Loans or
(c) a combination thereof, as determined by the Parent Borrower and notified to
the Administrative Agent in accordance with subsections 2.9 and 4.2. The
Borrower may, with the prior written consent of the relevant Tranche A Term Loan
Lender, convert all
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35
or any portion of the Tranche A Term Loans of such Lender into Tranche A Term
Loans denominated in a Designated Foreign Currency, with such conversion to be
made at the Spot Rate of Exchange on the date that is two Business Days prior to
the date of such conversion.
2.7 Tranche A Term Notes. (a) The Parent Borrower agrees that, upon
the request to the Administrative Agent by any Tranche A Term Loan Lender made
on or prior to the Effective Date or in connection with any assignment of its
Loan, in order to evidence such Term Loan Lender's Tranche A Term Loan the
Parent Borrower will execute and deliver to such Term Loan Lender a promissory
note substantially in the form of Exhibit A-2 (each, as amended, supplemented,
replaced or otherwise modified from time to time, a "Tranche A Term Note"), with
appropriate insertions therein as to payee, date and principal amount, payable
to the order of such Term Loan Lender and in a principal amount equal to the
lesser of (a) the amount set forth opposite such Term Loan Lender's name on
Schedule I under the heading "Tranche A Term Loan Commitment" and (b) the unpaid
principal amount of the Tranche A Term Loan made by such Term Loan Lender. Each
Tranche A Term Note shall (i) be dated the Effective Date, (ii) be payable as
provided in subsection 2.7(b) and (iii) provide for the payment of interest in
accordance with subsection 4.1.
(b) The aggregate principal amount of all of the Tranche A Term
Loans to be made on the Effective Date by the Term Loan Lenders is $150,000,000.
The aggregate Tranche A Term Loans of all the Term Loan Lenders (together with
all accrued interest thereon) shall be payable in 28 consecutive installments on
the dates and in a principal amount equal to (i) the percentage set forth below
opposite such date multiplied by (ii) the aggregate principal amount of all of
the Tranche A Term Loans made on the Effective Date by the Term Loan Lenders
(using, for any Tranche A Term Loans converted to a Designated Foreign Currency,
the Spot Rate of Exchange used in such conversion):
Dates Percentage
----- ----------
March 24, 2000 0.825%
June 23, 2000 0.825%
September 22, 2000 0.825%
December 29, 2000 0.825%
March 30, 2001 1.675%
June 29, 2001 1.675%
September 28, 2001 1.675%
December 28, 2001 1.675%
March 29, 2002 2.500%
June 28, 2002 2.500%
September 27, 2002 2.500%
December 27, 2002 2.500%
March 28, 2003 3.325%
June 27, 2003 3.325%
September 26, 2003 3.325%
December 26, 2003 3.325%
March 26, 2004 3.325%
June 25, 2004 3.325%
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36
September 24, 2004 3.325%
December 24, 2004 3.325%
March 25, 2005 5.825%
June 24, 2005 5.825%
September 23, 2005 5.825%
December 30, 2005 5.825%
March 31, 2006 7.525%
June 30, 2006 7.525%
September 29, 2006 7.525%
Termination Date 7.525%
provided that in the event that the Parent Borrower changes its fiscal year end
to the last day of December, each of the foregoing amortization dates (other
than the Termination Date) occurring after such change shall be deemed to be the
last day of March, June, September or December, as applicable (e.g., the
amortization payment scheduled for March 30, 2001 shall be due on March 31,
2001, and the amortization payment scheduled for June 29, 2001 shall be due on
June 30, 2001).
2.8 Tranche B Term Notes. (a) The Parent Borrower agrees that, upon
the request to the Administrative Agent by any Tranche B Term Loan Lender made
on or prior to the Effective Date or in connection with any assignment of its
Loan, in order to evidence such Term Loan Lender's Tranche B Term Loan the
Parent Borrower will execute and deliver to such Term Loan Lender a promissory
note substantially in the form of Exhibit A-3 (each, as amended, supplemented,
replaced or otherwise modified from time to time, a "Tranche B Term Note"), with
appropriate insertions therein as to payee, date and principal amount, payable
to the order of such Term Loan Lender and in a principal amount equal to the
lesser of (a) the amount set forth opposite such Term Loan Lender's name on
Schedule I under the heading "Tranche B Term Loan Commitment" and (b) the unpaid
principal amount of the Tranche B Term Loan made by such Term Loan Lender. Each
Tranche B Term Note shall (i) be dated the Effective Date, (ii) be payable as
provided in subsection 2.8(b) and (iii) provide for the payment of interest in
accordance with subsection 4.1.
(b) The aggregate Tranche B Term Loans of all the Term Loan Lenders
shall be payable in 32 consecutive installments on the dates and in a principal
amount equal to the amount set forth below (together with all accrued interest
thereon) opposite the applicable installment date (or, if less, the aggregate
amount of the Tranche B Term Loans then outstanding):
Dates Amount
----- ------
March 24, 2000 $ 437,500
June 23, 2000 $ 437,500
September 22, 2000 $ 437,500
December 29, 2000 $ 437,500
March 30, 2001 $ 437,500
June 29, 2001 $ 437,500
September 28, 2001 $ 437,500
December 28, 2001 $ 437,500
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37
March 29, 2002 $ 437,500
June 28, 2002 $ 437,500
September 27, 2002 $ 437,500
December 27, 2002 $ 437,500
March 28, 2003 $ 437,500
June 27, 2003 $ 437,500
September 26, 2003 $ 437,500
December 26, 2003 $ 437,500
March 26, 2004 $ 437,500
June 25, 2004 $ 437,500
September 24, 2004 $ 437,500
December 24, 2004 $ 437,500
March 25, 2005 $ 437,500
June 24, 2005 $ 437,500
September 23, 2005 $ 437,500
December 30, 2005 $ 437,500
March 31, 2006 $16,125,000
June 30, 2006 $16,125,000
September 29, 2006 $16,125,000
December 29, 2006 $16,125,000
March 30, 2007 $25,000,000
June 29, 2007 $25,000,000
September 28, 2007 $25,000,000
Final Maturity Date $25,000,000
provided that in the event that the Parent Borrower changes its fiscal year end
to the last day of December, each of the foregoing amortization dates (other
than the Final Maturity Date) occurring after such change shall be deemed to be
the last day of March, June, September or December, as applicable (e.g., the
amortization payment scheduled for March 30, 2001 shall be due on March 31,
2001, and the amortization payment scheduled for June 29, 2001 shall be due on
June 30, 2001).
2.9 Procedure for Term Loan Borrowing. The Parent Borrower shall
give the Administrative Agent irrevocable notice (which notice must be received
by the Administrative Agent prior to (a) 12:30 P.M., New York City time, at
least three Business Days prior to the Effective Date, if all or any part of the
Term Loans are to be initially Eurocurrency Loans made in Dollars, (b) 11:00
A.M., London time, at least three Business Days prior to the Effective Date, if
any part of the Tranche A Term Loans are to be initially Eurocurrency Loans made
in any Designated Foreign Currency or (c) 12:30 P.M., New York City time, at
least one Business Day prior to the Effective Date, otherwise) requesting that
the Term Loan Lenders make the Term Loans on the Effective Date and specifying
(i) the amount to be borrowed, (ii) whether the Term Loans are to be initially
Eurocurrency Loans, ABR Loans or a combination thereof, and (iii) if the Term
Loans are to be entirely or partly Eurocurrency Loans, the respective amounts of
each such Type of Loan and the respective lengths of the initial Interest
Periods therefor and, if the Eurocurrency Loans in respect of any part of the
borrowing of Tranche A Term Loans are to be made entirely or partly in any
Designated Foreign Currency, the Designated Foreign Currency thereof. Upon
receipt of such notice the Administrative Agent shall
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promptly notify each Term Loan Lender thereof. Each Term Loan Lender will make
the amount of its pro rata share of the Term Loans available to the
Administrative Agent for the account of the Parent Borrower at the office of the
Administrative Agent specified in subsection 11.2 prior to 10:00 A.M., New York
City time, or at such other office of the Administrative Agent or at such other
time as to which the Administrative Agent shall notify such Term Loan Lender and
the Parent Borrower reasonably in advance of the Effective Date with respect
thereto, on the Effective Date in Dollars or the applicable Designated Foreign
Currency and in funds immediately available to the Administrative Agent. The
Administrative Agent shall on such date credit the account of the Parent
Borrower on the books of such office of the Administrative Agent with the
aggregate of the amounts made available to the Administrative Agent by the Term
Loan Lenders and in like funds as received by the Administrative Agent.
2.10 Repayment of Loans. (a) Each of the Borrowers hereby
unconditionally promises to pay to the Administrative Agent for the account of
(i) each Revolving Credit Lender, the then unpaid principal amount of each
Revolving Credit Loan of such Revolving Credit Lender made to such Borrower, on
the Termination Date (or such earlier date on which the Revolving Credit Loans
become due and payable pursuant to Section 9); (ii) the Swing Line Lender, the
then unpaid principal amount of the Swing Line Loans made to such Borrower, on
the Termination Date (or such earlier date on which the Swing Line Loans become
due and payable pursuant to Section 9); (iii) in the case of the Parent Borrower
only, each Tranche A Term Loan Lender, the amounts specified in subsection
2.7(b) (or, if less, the aggregate amount of the Tranche A Term Loans then
outstanding), on the dates specified in subsection 2.7(b) (or such earlier date
on which the Tranche A Term Loans become due and payable pursuant to Section 9);
and (iv) in the case of the Parent Borrower only, each Tranche B Term Loan
Lender, the amounts specified in subsection 2.8(b) (or, if less, the aggregate
amount of the Tranche B Term Loans then outstanding), on the dates specified in
subsection 2.8(b) (or such earlier date on which the Tranche B Term Loans become
due and payable pursuant to Section 9). Each of the Borrowers hereby further
agrees to pay interest on the unpaid principal amount of the Loans made to such
Borrower from time to time outstanding from the date hereof until payment in
full thereof at the rates per annum, and on the dates, set forth in subsection
4.1.
(b) Each Lender (including the Swing Line Lender) shall maintain in
accordance with its usual practice an account or accounts evidencing
indebtedness of each of the Borrowers to such Lender resulting from each Loan of
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time under this Agreement.
(c) The Administrative Agent shall maintain the Register pursuant to
subsection 11.6(d), and a subaccount therein for each Lender, in which shall be
recorded (i) the amount of each Loan made hereunder, the Type thereof and each
Interest Period, if any, applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from each of the Borrowers
to each Lender hereunder and (iii) both the amount of any sum received by the
Administrative Agent hereunder from each of the Borrowers and each Lender's
share thereof.
(d) The entries made in the Register and the accounts of each Lender
maintained pursuant to subsection 2.10(b) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of each of the Borrowers therein recorded; provided,
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39
however, that the failure of any Lender or the Administrative Agent to maintain
the Register or any such account, or any error therein, shall not in any manner
affect the obligation of any Borrower to repay (with applicable interest) the
Loans made to such Borrower by such Lender in accordance with the terms of this
Agreement.
SECTION 3. LETTERS OF CREDIT
3.1 L/C Commitment. (a) Subject to the terms and conditions hereof,
the Issuing Lender, in reliance on the agreements of the other Revolving Credit
Lenders set forth in subsection 3.4(a), agrees to continue outstanding under
this Agreement the Existing Letters of Credit and issue letters of credit (the
letters of credit issued on and after the Effective Date pursuant to this
Section 3, together with the Existing Letters of Credit, collectively, the
"Letters of Credit") for the account of each of the Borrowers on any Business
Day during the Revolving Credit Commitment Period in such form as may be
approved from time to time by the Issuing Lender, provided that the Issuing
Lender shall not issue any Letter of Credit if, after giving effect to such
issuance, (i) the sum of the Dollar Equivalent of the then outstanding Revolving
Credit Loans in any Designated Foreign Currency and the then outstanding L/C
Obligations in respect of any Foreign Backstop Letters of Credit would exceed
$50,000,000 (it being understood and agreed that the Administrative Agent shall
calculate the Dollar Equivalent of the then outstanding Revolving Credit Loans
in any Designated Foreign Currency and, to the extent applicable, of the then
outstanding L/C Obligations in respect of any Foreign Backstop Letters of Credit
on the date on which the Parent Borrower has requested that the Issuing Lender
issue a Letter of Credit for purposes of determining compliance with this clause
(i)), (ii) the L/C Obligations in respect of Letters of Credit other than
Foreign Backstop Letters of Credit would exceed $50,000,000 or (iii) the
Aggregate Outstanding Revolving Credit of all the Revolving Credit Lenders would
exceed the Revolving Credit Commitments of all the Revolving Credit Lenders then
in effect. Each Letter of Credit shall (A) be denominated in Dollars or, in the
case of Foreign Backstop Letters of Credit, in Dollars or any Designated Foreign
Currency and shall be either (x) a standby letter of credit issued to support
obligations of the Parent Borrower or any of its Subsidiaries, contingent or
otherwise, which finance the working capital and business needs of the Parent
Borrower and its Subsidiaries incurred in the ordinary course of business (a
"Standby Letter of Credit"), or (y) a commercial letter of credit in respect of
the purchase of goods or services by the Parent Borrower or any of its
Subsidiaries in the ordinary course of business (a "Commercial Letter of
Credit"), (B) expire no later than the Termination Date, and (C) expire no later
than 365 days after its date of issuance in the case of Standby Letters of
Credit, and 180 days after its date of issuance in the case of Commercial
Letters of Credit.
(b) Each Letter of Credit shall be subject to the Uniform Customs
and, to the extent not inconsistent therewith, the laws of the State of New
York.
(c) The Issuing Lender shall not at any time be obligated to issue
any Letter of Credit hereunder if such issuance would conflict with, or cause
the Issuing Lender or any L/C Participant to exceed any limits imposed by, any
applicable Requirement of Law.
3.2 Procedure for Issuance of Letters of Credit. The Parent Borrower
may from time to time request that the Issuing Lender issue a Letter of Credit
by delivering to the Issuing Lender, at its
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40
address for notices specified herein, an Application therefor, completed to the
reasonable satisfaction of the Issuing Lender, and such other certificates,
documents and other papers and information as the Issuing Lender may reasonably
request. Upon receipt of any Application, the Issuing Lender will process such
Application and the certificates, documents and other papers and information
delivered to it in connection therewith in accordance with its customary
procedures and shall promptly issue the Letter of Credit requested thereby (but
in no event shall the Issuing Lender be required to issue any Letter of Credit
earlier than three Business Days after its receipt of the Application therefor
and all such other certificates, documents and other papers and information
relating thereto) by issuing the original of such Letter of Credit to the
beneficiary thereof or as otherwise may be agreed by the Issuing Lender and the
Parent Borrower. The Issuing Lender shall furnish a copy of such Letter of
Credit to the Parent Borrower promptly following the issuance thereof.
3.3 Fees, Commissions and Other Charges. (a) Each Borrower shall pay
to the Administrative Agent, for the account of the Issuing Lender and the L/C
Participants, a letter of credit commission with respect to each Letter of
Credit issued for the account of such Borrower, computed for the period from and
including the date of issuance of such Letter of Credit to the expiration date
of such Letter of Credit, computed at the rate per annum equal to the Applicable
Margin in effect for Revolving Credit Loans that are Eurocurrency Loans,
calculated on the basis of a 365- (or 366-, as the case may be) day year, of the
aggregate amount available to be drawn under such Letter of Credit, payable
(without duplication) quarterly in arrears on each L/C Fee Payment Date to occur
while such Letter of Credit remains outstanding and on the expiration date of
such Letter of Credit and the Termination Date. Such commission shall be payable
to the Administrative Agent for the account of the Revolving Credit Lenders to
be shared ratably among them in accordance with their respective Revolving
Credit Commitment Percentages. Each Borrower shall also pay to the
Administrative Agent, for the account of the Issuing Lender, a fee equal to 1/4
of 1% per annum of the aggregate amount available to be drawn under each Letter
of Credit issued for the account of such Borrower, payable quarterly in arrears
on each L/C Fee Payment Date to occur while such Letter of Credit remains
outstanding and on the expiration date of such Letter of Credit. Such
commissions shall be nonrefundable. Such fees and commissions shall be payable
in Dollars, notwithstanding that a Letter of Credit may be denominated in any
Designated Foreign Currency. In respect of a Letter of Credit denominated in any
Designated Foreign Currency, such fees and commissions shall be converted into
Dollars at the Spot Rate of Exchange on the date on which they are paid (or, if
such date is not a Business Day, at the Spot Rate of Exchange on the Business
Day next preceding such date).
(b) In addition to the foregoing fees and commissions, each Borrower
shall pay or reimburse the Issuing Lender for such normal and customary costs
and expenses as are incurred or charged by the Issuing Lender in issuing,
effecting payment under, amending or otherwise administering any Letter of
Credit issued for the account of such Borrower.
(c) The Administrative Agent shall, promptly following its receipt
thereof, distribute to the Issuing Lender and the L/C Participants all fees and
commissions received by the Administrative Agent for their respective accounts
pursuant to this subsection. The Administrative Agent shall notify the Lenders
at least monthly of the aggregate outstanding Letters of Credit.
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41
3.4 L/C Participations. (a) The Issuing Lender irrevocably agrees to
grant and hereby grants to each L/C Participant, and, to induce the Issuing
Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably
agrees to accept and purchase and hereby accepts and purchases from the Issuing
Lender, on the terms and conditions hereinafter stated, for such L/C
Participant's own account and risk an undivided interest equal to such L/C
Participant's Revolving Credit Commitment Percentage (determined on the date of
issuance of the relevant Letter of Credit) in the Issuing Lender's obligations
and rights under each Letter of Credit issued or continued hereunder and the
amount of each draft paid by the Issuing Lender thereunder. Each L/C Participant
unconditionally and irrevocably agrees with the Issuing Lender that, if a draft
is paid under any Letter of Credit for which the Issuing Lender is not
reimbursed in full by the Borrower in respect of such Letter of Credit in
accordance with subsection 3.5(a), such L/C Participant shall pay to the Issuing
Lender upon demand (which demand, in the case of any demand made in respect of
any draft under a Letter of Credit denominated in any Designated Foreign
Currency, shall not be made prior to the date that the amount of such draft
shall be converted into Dollars in accordance with subsection 3.5(a)) at the
Issuing Lender's address for notices specified herein an amount equal to such
L/C Participant's Revolving Credit Commitment Percentage of the amount of such
draft, or any part thereof, which is not so reimbursed; provided that nothing in
this paragraph shall relieve the Issuing Lender of any liability resulting from
the gross negligence or willful misconduct of the Issuing Lender, or otherwise
affect any defense or other right that any L/C Participant may have as a result
of such gross negligence or willful misconduct.
(b) If any amount required to be paid by any L/C Participant to the
Issuing Lender pursuant to subsection 3.4(a) in respect of any unreimbursed
portion of any payment made by the Issuing Lender under any Letter of Credit is
paid to the Issuing Lender within three Business Days after the date such
payment is due, such L/C Participant shall pay to the Issuing Lender on demand
an amount equal to the product of (i) such amount, times (ii) the daily average
Federal Funds Effective Rate during the period from and including the date such
payment is required to the date on which such payment is immediately available
to the Issuing Lender, times (iii) a fraction the numerator of which is the
number of days that elapse during such period and the denominator of which is
360. If any such amount required to be paid by any L/C Participant pursuant to
subsection 3.4(a) is not in fact made available to the Issuing Lender by such
L/C Participant within three Business Days after the date such payment is due,
the Issuing Lender shall be entitled to recover from such L/C Participant, on
demand, such amount with interest thereon calculated from such due date at the
rate per annum applicable to ABR Loans that are Revolving Credit Loans. A
certificate of the Issuing Lender submitted to any L/C Participant with respect
to any amounts owing under this subsection shall be conclusive in the absence of
manifest error.
(c) Whenever, at any time after the Issuing Lender has made payment
under any Letter of Credit and has received from any L/C Participant its pro
rata share of such payment in accordance with subsection 3.4(a), the Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from the Borrower in respect of such Letter of Credit or otherwise, including
proceeds of Collateral applied thereto by the Issuing Lender), or any payment of
interest on account thereof, the Issuing Lender will, if such payment is
received prior to 1:00 P.M., New York City time, on a Business Day, distribute
to such L/C Participant its pro rata share thereof prior to the end of such
Business Day and otherwise the Issuing Lender will distribute such payment on
the next succeeding Business Day; provided, however, that in the event that any
such payment received by the Issuing
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42
Lender shall be required to be returned by the Issuing Lender, such L/C
Participant shall return to the Issuing Lender the portion thereof previously
distributed by the Issuing Lender to it.
3.5 Reimbursement Obligation of the Borrowers. (a) Each of the
Borrowers agrees to reimburse the Issuing Lender, upon receipt by the Parent
Borrower of notice from the Issuing Lender of the date and amount of a draft
presented under any Letter of Credit issued for the account of such Borrower and
paid by the Issuing Lender, for the amount of (i) such draft so paid and (ii)
any taxes, fees, charges or other costs or expenses reasonably incurred by the
Issuing Lender in connection with such payment. Each such payment shall be made
to the Issuing Lender, at its address for notices specified herein in the
currency in which such Letter of Credit is denominated (except that, in the case
of any Letter of Credit denominated in any Designated Foreign Currency, in the
event that such payment is not made to the Issuing Lender within three Business
Days of the date of receipt by the Parent Borrower of such notice, upon notice
by the Issuing Lender to the Parent Borrower, such payment shall be made in
Dollars, in an amount equal to the Dollar Equivalent of the amount of such
payment converted on the date of such notice into Dollars at the Spot Rate of
Exchange on such date) and in immediately available funds, on the date on which
the Parent Borrower (on behalf of itself or such Borrower, as the case may be)
receives such notice, if received prior to 11:00 A.M., New York City time, on a
Business Day and otherwise on the next succeeding Business Day. Any conversion
by the Issuing Lender of any payment to be made by any Borrower in respect of
any Letter of Credit denominated in any Designated Foreign Currency into Dollars
in accordance with this subsection 3.5(a) shall be conclusive and binding upon
such Borrower and the Revolving Credit Lenders in the absence of manifest error;
provided that upon the request of any Borrower or any Revolving Credit Lender,
the Issuing Lender shall provide to such Borrower or Revolving Credit Lender a
certificate including reasonably detailed information as to the calculation of
such conversion.
(b) Interest shall be payable on any and all amounts remaining
unpaid by any of the Borrowers under this subsection (i) from the date the draft
presented under the affected Letter of Credit is paid to the date on which such
Borrower is required to pay such amounts pursuant to paragraph (a) above at the
rate which would then be payable on any outstanding ABR Loans that are Revolving
Credit Loans and (ii) thereafter until payment in full at the rate which would
be payable on any outstanding ABR Loans that are Tranche B Term Loans which were
then overdue.
3.6 Obligations Absolute. (a) Each of the Borrowers' obligations
under this Section 3 shall be absolute and unconditional under any and all
circumstances and irrespective of any set-off, counterclaim or defense to
payment which such Borrower may have or have had against the Issuing Lender, any
L/C Participant or any beneficiary of a Letter of Credit, provided that this
paragraph shall not relieve the Issuing Lender or any L/C Participant of any
liability resulting from the gross negligence or willful misconduct of the
Issuing Lender or such L/C Participant, or otherwise affect any defense or other
right that such Borrower may have as a result of any such gross negligence or
willful misconduct.
(b) Each Borrower also agrees with the Issuing Lender that the
Issuing Lender and the L/C Participants shall not be responsible for, and such
Borrower's Reimbursement Obligations under subsection 3.5(a) shall not be
affected by, among other things, (i) the validity or genuineness of documents or
of any endorsements thereon, even though such documents shall in fact prove to
be invalid, fraudulent or forged, or (ii) any dispute between or among such
Borrower and any beneficiary
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43
of any Letter of Credit or any other party to which such Letter of Credit may be
transferred or (iii) any claims whatsoever of such Borrower against any
beneficiary of such Letter of Credit or any such transferee, provided that this
paragraph shall not relieve the Issuing Lender or any L/C Participant of any
liability resulting from the gross negligence or willful misconduct of the
Issuing Lender or such L/C Participant, or otherwise affect any defense or other
right that such Borrower may have as a result of any such gross negligence or
willful misconduct.
(c) Neither the Issuing Lender nor any L/C Participant shall be
liable for any error, omission, interruption or delay in transmission, dispatch
or delivery of any message or advice, however transmitted, in connection with
any Letter of Credit, except for errors or omissions caused by such Person's
gross negligence or willful misconduct.
(d) Each Borrower agrees that any action taken or omitted by the
Issuing Lender under or in connection with any Letter of Credit or the related
drafts or documents, if done in the absence of gross negligence or willful
misconduct and in accordance with the standards of care specified in the Uniform
Commercial Code of the State of New York, shall be binding on such Borrower and
shall not result in any liability of the Issuing Lender or any L/C Participant
to such Borrower.
3.7 Letter of Credit Payments. If any draft shall be presented for
payment under any Letter of Credit, the Issuing Lender shall promptly notify the
Parent Borrower of the date and amount thereof. The responsibility of the
Issuing Lender to the Borrower in respect of any Letter of Credit in connection
with any draft presented for payment under any Letter of Credit shall, in
addition to any payment obligation expressly provided for in such Letter of
Credit, be limited to determining that the documents (including each draft)
delivered under such Letter of Credit in connection with such presentment are in
conformity with such Letter of Credit, provided that this paragraph shall not
relieve the Issuing Lender of any liability resulting from the gross negligence
or willful misconduct of the Issuing Lender, or otherwise affect any defense or
other right that such Borrower may have as a result of any such gross negligence
or willful misconduct.
3.8 Application. To the extent that any provision of any Application
related to any Letter of Credit is inconsistent with the provisions of this
Section 3, the provisions of this Section 3 shall apply.
SECTION 4. GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
4.1 Interest Rates and Payment Dates. (a) Each Eurocurrency Loan
shall bear interest for each day during each Interest Period with respect
thereto at a rate per annum equal to the Eurocurrency Rate determined for such
day plus the Applicable Margin in effect for such day.
(b) Each ABR Loan shall bear interest for each day that it is
outstanding at a rate per annum equal to the ABR for such day plus the
Applicable Margin in effect for such day.
(c) If all or a portion of (i) the principal amount of any Loan,
(ii) any interest payable thereon or (iii) any commitment fee or other amount
payable hereunder shall not be paid when due
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44
(whether at the stated maturity, by acceleration or otherwise), such overdue
amount shall bear interest at a rate per annum which is (x) in the case of
overdue principal, the rate that would otherwise be applicable thereto pursuant
to the relevant foregoing provisions of this subsection plus 2.00% or (y) in the
case of overdue interest, fees or other amounts, the rate described in paragraph
(b) of this subsection for ABR Loans that are Tranche B Term Loans plus 2.00%,
in each case from the date of such non-payment until such amount is paid in full
(as well after as before judgment).
(d) Interest shall be payable in arrears on each Interest Payment
Date, provided that interest accruing pursuant to paragraph (c) of this
subsection shall be payable from time to time on demand.
(e) It is the intention of the parties hereto to comply strictly
with applicable usury laws; accordingly, it is stipulated and agreed that the
aggregate of all amounts which constitute interest under applicable usury laws,
whether contracted for, charged, taken, reserved, or received, in connection
with the indebtedness evidenced by this Agreement or any Notes, or any other
document relating or referring hereto or thereto, now or hereafter existing,
shall never exceed under any circumstance whatsoever the maximum amount of
interest allowed by applicable usury laws.
4.2 Conversion and Continuation Options. (a) The Parent Borrower may
elect from time to time to convert outstanding Term Loans and Revolving Credit
Loans from Eurocurrency Loans made or outstanding in Dollars to ABR Loans by
giving the Administrative Agent at least two Business Days' prior irrevocable
notice of such election, provided that any such conversion of Eurocurrency Loans
made or outstanding in Dollars may only be made on the last day of an Interest
Period with respect thereto. The Parent Borrower may elect from time to time to
convert outstanding Term Loans and Revolving Credit Loans from ABR Loans to
Eurocurrency Loans outstanding in Dollars by giving the Administrative Agent at
least three Business Days' prior irrevocable notice of such election. Any such
notice of conversion to Eurocurrency Loans outstanding in Dollars shall specify
the length of the initial Interest Period or Interest Periods therefor. Upon
receipt of any such notice the Administrative Agent shall promptly notify each
affected Lender thereof. All or any part of outstanding Eurocurrency Loans made
or outstanding in Dollars and ABR Loans may be converted as provided herein,
provided that (i) (unless the Required Lenders otherwise consent) no Loan may be
converted into a Eurocurrency Loan when any Default or Event of Default has
occurred and is continuing and, in the case of any Default, the Administrative
Agent has given notice to the Parent Borrower that no such conversions may be
made and (ii) no Loan may be converted into a Eurocurrency Loan after the date
that is one month prior to either the Termination Date (in the case of
conversions of Revolving Credit Loans or Tranche A Term Loans) or the Final
Maturity Date (in the case of conversions of Tranche B Term Loans).
(b) Any Eurocurrency Loans may be continued as such upon the
expiration of the then current Interest Period with respect thereto by the
Parent Borrower giving notice to the Administrative Agent, of the length of the
next Interest Period to be applicable to such Loans, determined in accordance
with the applicable provisions of the term "Interest Period" set forth in
subsection 1.1, provided that no Eurocurrency Loan may be continued as such (i)
(unless the Required Lenders otherwise consent) when any Default or Event of
Default has occurred and is continuing and, in the case of any Default, the
Administrative Agent has given notice to the Parent Borrower that no such
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continuations may be made or (ii) after the date that is one month prior to
either the Termination Date (in the case of continuations of Revolving Credit
Loans or Tranche A Term Loans) or the Final Maturity Date (in the case of
continuations of Tranche B Term Loans), and provided, further, that (A) in the
case of Eurocurrency Loans made or outstanding in Dollars, if the Parent
Borrower shall fail to give any required notice as described above in this
paragraph or if such continuation is not permitted pursuant to the preceding
proviso such Loans shall be automatically converted to ABR Loans on the last day
of such then expiring Interest Period and (B) in case of Eurocurrency Loans made
or outstanding in any Designated Foreign Currency, if the Parent Borrower shall
fail to give any required notice as described above in this paragraph or if such
continuation is not permitted pursuant to clause (i) of the preceding proviso,
such Eurocurrency Loans will be continued for the shortest available Interest
Periods as determined by the Administrative Agent. Upon receipt of any such
notice of continuation pursuant to this subsection 4.2(b), the Administrative
Agent shall promptly notify each affected Lender thereof.
4.3 Minimum Amounts of Tranches. All borrowings, conversions and
continuations of Loans hereunder and all selections of Interest Periods
hereunder shall be in such amounts and be made pursuant to such elections so
that, after giving effect thereto, the aggregate principal amount of the
Eurocurrency Loans outstanding in Dollars comprising each Tranche shall be equal
to $5,000,000 or a whole multiple of $1,000,000 in excess thereof, the Dollar
Equivalent of the aggregate principal amount of the Eurocurrency Loans
outstanding in any Designated Foreign Currency comprising each Set shall be
equal to $5,000,000 or a whole multiple of $1,000,000 in excess thereof and so
that there shall not be more than 15 Tranches at any one time outstanding.
4.4 Optional and Mandatory Prepayments and Commitment Reductions.
(a) Each of the Borrowers may at any time and from time to time prepay the Loans
(including the Reimbursement Obligations in respect of Letters of Credit issued
for its account) and permanently reduce the Revolving Credit Commitments, in
whole or in part, subject to subsections 4.4(k) and 4.12, without premium or
penalty, upon at least three Business Days' irrevocable notice by the Parent
Borrower on behalf of the applicable Borrower to the Administrative Agent (in
the case of Eurocurrency Loans and Reimbursement Obligations outstanding in any
Designated Foreign Currency), at least, three Business Days' irrevocable notice
by the Parent Borrower to the Administrative Agent (in the case of Eurocurrency
Loans and Reimbursement Obligations outstanding in Dollars), at least one
Business Day's irrevocable notice by the Parent Borrower to the Administrative
Agent (in the case of ABR Loans other than Swing Line Loans) or same-day
irrevocable notice by the Parent Borrower to the Administrative Agent (in the
case of Swing Line Loans), specifying, in the case of any prepayment of Loans,
the date and amount of prepayment or reduction, as the case may be, the identity
of the prepaying Borrower, and whether the prepayment is (i) of Term Loans,
Revolving Credit Loans or Swing Line Loans, or a combination thereof, or (ii) of
Eurocurrency Loans, ABR Loans or a combination thereof, and, in each case if a
combination thereof, the principal amount allocable to each and, in the case of
any prepayment of Reimbursement Obligations, the date and amount of prepayment,
the identity of the applicable Letter of Credit or Letters of Credit and the
amount allocable to each of such Reimbursement Obligations. Upon the receipt of
any such notice the Administrative Agent shall promptly notify each affected
Lender thereof. If any such notice is given, the amount specified in such notice
shall be due and payable on the date specified therein, together with (if a
Eurocurrency Loan is prepaid other than at the end of the Interest Period
applicable thereto) any amounts payable pursuant to
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46
subsection 4.12 and, in the case of prepayments of the Term Loans only, accrued
interest to such date on the amount prepaid. Partial prepayments of (i) the Term
Loans shall be applied (x) pro rata (based on outstanding principal amount) to
the Tranche A Term Loans and the Tranche B Term Loans and (y) pro rata to the
respective installments of principal thereof, provided that any such payment
made within 12 months prior to the date on which an installment of principal
thereof is scheduled to be made may, at the option of the Parent Borrower, be
applied first to such installment, and (ii) the Revolving Credit Loans and the
Letters of Credit shall be applied, first, to payment of the Swing Line Loans
then outstanding, second, to payment of the Revolving Credit Loans then
outstanding, third, to payment of any Reimbursement Obligations then outstanding
and, last, to cash collateralize any outstanding L/C Obligation on terms
reasonably satisfactory to the Administrative Agent. Partial prepayments
pursuant to this subsection 4.4(a) shall be in an aggregate principal amount of
$5,000,000 or a whole multiple of $1,000,000 in excess thereof (or, in the case
of Eurocurrency Loans outstanding in any Designated Foreign Currency, the Dollar
Equivalent of an aggregate principal amount of at least approximately
$5,000,000), provided that, notwithstanding the foregoing, any Loan may be
prepaid in its entirety.
(b) Except as otherwise provided in subsection 4.14, if, at any time
during the Revolving Credit Commitment Period, the Aggregate Outstanding
Revolving Credit with respect to all of the Revolving Credit Lenders (including
the Swing Line Lender) exceeds the aggregate Revolving Credit Commitments then
in effect, the Borrowers shall, without notice or demand, immediately repay the
Revolving Credit Loans and the Swing Line Loans in an aggregate principal amount
equal to such excess together with interest accrued to the date of such payment
or prepayment and any amounts payable under subsection 4.12. To the extent that
after giving effect to any prepayment of the Loans required by the preceding
sentence, such Aggregate Outstanding Revolving Credit exceeds the aggregate
Revolving Credit Commitments then in effect, the Borrowers shall, without notice
or demand, immediately cash collateralize the then outstanding L/C Obligations
in an amount equal to such excess upon terms reasonably satisfactory to the
Administrative Agent.
(c) If (i) Holding or any of its Subsidiaries shall incur
Indebtedness for borrowed money (other than Indebtedness permitted pursuant to
subsection 8.2 hereof and Section 5.4.2 of the Guarantee and Collateral
Agreement) pursuant to a public offering or private placement or otherwise, (ii)
Holding or any of its Subsidiaries shall make an Asset Sale (other than pursuant
to clauses (i), (ii), (iii), (iv), (v), (vi) and (viii) of subsection 8.6(a)),
(iii) Holding or any of its Subsidiaries shall enter into a Permitted
Receivables Securitization or (iv) Holding or any of Subsidiaries shall receive
in excess of $20,000,000 of Net Cash Proceeds from Sale and Leaseback
Transactions during the term of this Agreement, then, in each case, the
Borrowers shall prepay the Loans and cash collateralize the L/C Obligations in
an amount equal to (w) in the case of the incurrence of any such Indebtedness,
100% of the Net Cash Proceeds thereof, (x) in the case of any such Asset Sale,
100% of the Net Cash Proceeds thereof minus any Reinvested Amounts, (y) in the
case of any such Permitted Receivables Securitization, 100% of the Net Cash
Proceeds thereof and (z) in the case of any such Sale and Leaseback Transaction,
100% of the Net Cash Proceeds to the extent such Net Cash Proceeds, together
with the Net Cash Proceeds of any other Sale and Leaseback Transaction entered
into by Holding or any of its Subsidiaries, exceeds $20,000,000, in each such
case, with such prepayment to be made on the date of receipt of any such Net
Cash Proceeds. Nothing in this paragraph (c) shall limit the rights of the
Administrative Agent and the Lenders set forth in Section 9.
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(d) Commencing March 31, 2001, and on each March 31 thereafter, the
Borrowers shall apply toward the prepayment of the Term Loans and the reduction
of the Revolving Credit Commitments as set forth in subsection 4.4(f) the ECF
Percentage of the Parent Borrower's Excess Cash Flow for the fiscal year ending
on the immediately preceding last Saturday in December (or, (i) in the case of
any year where December 31 is a Saturday, the fiscal year ending on the date in
December set forth opposite such fiscal year on Schedule 4.4(d) and (ii) in the
case of the first such payment, the fiscal period beginning on the Effective
Date and ending on December 24, 1999).
(e) The Borrowers shall prepay all Swing Line Loans then outstanding
simultaneously with each borrowing of Revolving Credit Loans.
(f) Prepayments pursuant to subsections 4.4(c) and 4.4(d) shall be
applied, first, to prepay Term Loans then outstanding, second, to prepay Swing
Line Loans then outstanding, third, to prepay Revolving Credit Loans then
outstanding, fourth, to pay any Reimbursement Obligations then outstanding and,
last, to cash collateralize any outstanding L/C Obligations on terms reasonably
satisfactory to the Administrative Agent. Prepayments of Term Loans pursuant to
subsections 4.4(c) and 4.4(d) shall be applied (x) pro rata (based on
outstanding principal amount) to the Tranche A Term Loans and the Tranche B Term
Loans and (y) pro rata to the respective installments of principal thereof,
provided that any such payment made within 12 months prior to the date on which
an installment of principal thereof is scheduled to be made may, at the option
of the Parent Borrower, be applied first to such installment.
(g) Notwithstanding anything to the contrary in this subsection 4.4,
so long as any Tranche A Term Loans are outstanding, each Tranche B Term Loan
Lender may, at its option, decline the portion of any optional prepayment or
mandatory payment applicable to the Tranche B Term Loans of such Lender;
accordingly, with respect to the amount of any optional or mandatory prepayment
described in this subsection 4.4 that is allocated to Tranche B Term Loans (such
amount, the "Tranche B Prepayment Amount"), the Parent Borrower will, in lieu of
applying such amount to the prepayment of Tranche B Term Loans as provided in
subsections 4.4(a), 4.4(c) and 4.4(d), on the date specified in this subsection
4.4 for such prepayment, give the Administrative Agent telephonic notice
(promptly confirmed in writing) requesting that the Administrative Agent prepare
and provide to each Tranche B Term Loan Lender a notice (each, a "Prepayment
Option Notice") as described below. As promptly as practicable after receiving
such notice from the Parent Borrower, the Administrative Agent will send to each
Tranche B Term Loan Lender a Prepayment Option Notice, which shall be in the
form of Exhibit D, and shall include an offer by the Parent Borrower to prepay
on the date (each, a "Prepayment Date") that is ten Business Days after the date
of the Prepayment Option Notice, the Tranche B Term Loans of such Lender by an
amount equal to the Tranche B Prepayment Amount indicated in such Lender's
Prepayment Option Notice. On the Prepayment Date, (i) the Parent Borrower shall
pay to the Administrative Agent the aggregate amount necessary to prepay that
portion of the outstanding Tranche B Term Loans in respect of which Tranche B
Term Loan Lenders have accepted prepayment as described above (such Lenders, the
"Accepting Lenders"), and such amount shall be applied to reduce the Tranche B
Prepayment Amounts with respect to each Accepting Lender and (ii) the Parent
Borrower shall pay to the Administrative Agent an amount equal to the portion of
the Tranche B Prepayment Amount not accepted by the Accepting Lenders, and such
amount shall be applied to the prepayment of the Tranche A Term Loans.
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(h) Amounts prepaid on account of Term Loans pursuant to subsection
4.4(a), 4.4(c) or 4.4(d) may not be reborrowed.
(i) The Revolving Credit Commitments shall be permanently reduced by
the amount of all prepayments of Revolving Credit Loans, payments of
Reimbursement Obligations and cash collateralizations of L/C Obligations made
under subsection 4.4(c) or 4.4(d). Notwithstanding anything to the contrary in
this subsection 4.4, in the event Holding or any of its Subsidiaries shall enter
into a Permitted Receivables Securitization, the aggregate Revolving Credit
Commitments of all the Revolving Credit Lenders shall not be reduced below
$25,000,000 pursuant to the terms of subsection 4.4(c)(iii).
(j) Notwithstanding the foregoing provisions of this subsection 4.4,
if at any time any prepayment of the Loans pursuant to subsection 4.4(b),
4.4(c), 4.4(d) or 4.14 would result, after giving effect to the procedures set
forth in this Agreement, in the Parent Borrower incurring breakage costs under
subsection 4.12 as a result of Eurocurrency Loans being prepaid other than on
the last day of an Interest Period with respect thereto, then the relevant
Borrower may, so long as no Default or Event of Default shall have occurred and
be continuing, in its sole discretion, initially (i) deposit a portion (up to
100%) of the amounts that otherwise would have been paid in respect of such
Eurocurrency Loans with the Administrative Agent (which deposit must be equal in
amount to the amount of such Eurocurrency Loans not immediately prepaid) to be
held as security for the obligations of the Borrowers to make such prepayment
pursuant to a cash collateral agreement to be entered into on terms reasonably
satisfactory to the Administrative Agent, with such cash collateral to be
directly applied upon the first occurrence thereafter of the last day of an
Interest Period with respect to which Eurocurrency Loans (or such earlier date
or dates as shall be requested by the Parent Borrower) or (ii) make a prepayment
of the Revolving Credit Loans in accordance with subsection 4.4(a) with an
amount equal to a portion (up to 100%) of the amounts that otherwise would have
been paid in respect of such Eurocurrency Loans (which prepayment, together with
any deposits pursuant to clause (i) above, must be equal in amount to the amount
of such Eurocurrency Loans not immediately prepaid); provided that,
notwithstanding anything in this Agreement to the contrary, none of the
Borrowers may request any Extension of Credit under the Revolving Credit
Commitments that would reduce the aggregate amount of the Available Revolving
Credit Commitments to an amount that is less than the amount of such prepayment
until the related portion of such Eurocurrency Loans have been prepaid;
provided, further, that, in the case of either clause (i) or (ii), such unpaid
Eurocurrency Loans shall continue to bear interest in accordance with subsection
4.1 until such unpaid Eurocurrency Loans or the related portion of such
Eurocurrency Loans, as the case may be, have or has been prepaid.
(k) Optional prepayments of Tranche B Term Loans, and any
prepayments of Tranche B Term Loans (whether optional or mandatory) made as a
result of or in connection with a Change of Control, any sale of all or
substantially all of the assets of the Parent Borrower and its Subsidiaries or
any refinancing of any of the Indebtedness hereunder, shall be at par plus
accrued interest on the amount prepaid plus a premium. The premium shall
initially be 2% of the aggregate principal amount prepaid, shall decline to 1%
on the first anniversary of the Effective Date and, from and after the second
anniversary of the Effective Date, shall be 0%.
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4.5 Commitment Fees; Administrative Agent's Fee; Other Fees. (a) The
Parent Borrower agrees to pay to the Administrative Agent for the account of
each Revolving Credit Lender, a commitment fee for the period from and including
the first day of the Revolving Credit Commitment Period to the Termination Date,
computed at the Commitment Fee Rate on the average daily amount of the Available
Revolving Credit Commitment of such Revolving Credit Lender during the period
for which payment is made, payable quarterly in arrears on the last day of each
March, June, September and December and on the Termination Date or such earlier
date as the Revolving Credit Commitments shall terminate as provided herein,
commencing on the Effective Date.
(b) The Parent Borrower shall pay to the Administrative Agent an
annual administration fee of $250,000 in respect of the period from the
Effective Date to the first anniversary thereof and of $150,000 in respect of
each annual period subsequent thereto, which fee shall be payable in equal
quarterly installments in advance on the Effective Date in respect of the
quarter in which the Effective Date occurs (prorated for the period from the
Effective Date to the end of such quarter) and on the last day of each March,
June, September and December thereafter (pro rated for the quarterly installment
paid immediately prior to the first anniversary of the Effective Date based on
the $250,000 amount for the period from the scheduled date of payment of such
quarterly installment to such first anniversary and based on the $150,000 amount
for the remainder of the quarterly period for which such payment is made).
(c) The Parent Borrower shall pay (without duplication, including of
any fee payable under subsections 4.5(a) and 4.5(b)) to Chase and Bank of
America, for their respective accounts and, as specified therein, for the
account of the Lenders, the other fees required to be paid pursuant to (i) the
Commitment Letter, dated November 11, 1999, among Chase, CSI, Bank of America,
BAS and the Parent Borrower and (ii) the Fee Letter, dated November 11, 1999,
among Chase, CSI, Bank of America, BAS and the Parent Borrower, in each case in
the amounts and on the dates set forth therein.
4.6 Computation of Interest and Fees. (a) Interest (other than
interest based on the Prime Rate) shall be calculated on the basis of a 360-day
year for the actual days elapsed; and commitment fees and interest based on the
Prime Rate shall be calculated on the basis of a 365- (or 366-, as the case may
be) day year for the actual days elapsed. The Administrative Agent shall as soon
as practicable notify the Parent Borrower and the affected Lenders of each
determination of a Eurocurrency Rate. Any change in the interest rate on a Loan
resulting from a change in the ABR, the Eurocurrency Reserve Requirements, the
C/D Assessment Rate or the C/D Reserve Percentage shall become effective as of
the opening of business on the day on which such change becomes effective. The
Administrative Agent shall as soon as practicable notify the Parent Borrower and
the affected Lenders of the effective date and the amount of each such change in
interest rate.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on each of the Borrowers and the Lenders in the absence of manifest
error. The Administrative Agent shall, at the request of the Parent Borrower,
deliver to the Parent Borrower a statement showing in reasonable detail the
calculations used by the Administrative Agent in determining any interest rate
pursuant to subsection 4.1, excluding any Eurocurrency Base Rate which is based
upon the Telerate British Bankers Assoc. Interest Settlement Rates Page and any
ABR which is based upon the Prime Rate.
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4.7 Inability to Determine Interest Rate. If prior to the first day
of any Interest Period, the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon each of the Borrowers) that,
by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurocurrency Rate with
respect to any Eurocurrency Loan (the "Affected Eurocurrency Rate") for such
Interest Period, the Administrative Agent shall give telecopy or telephonic
notice thereof to the Parent Borrower and the Lenders as soon as practicable
thereafter. If such notice is given, (a) any Eurocurrency Loans the rate of
interest applicable to which is based upon the Affected Eurocurrency Rate
requested to be made on the first day of such Interest Period shall be made as
ABR Loans (to the extent otherwise permitted by subsection 4.2), (b) any Loans
that were to have been converted on the first day of such Interest Period to or
continued as Eurocurrency Loans the rate of interest applicable to which is
based upon the Affected Eurocurrency Rate shall be converted to or continued as
ABR Loans (to the extent otherwise permitted by subsection 4.2), (c) any
outstanding Eurocurrency Loans that are Revolving Credit Loans that were to have
been converted on the first day of such Interest Period to or continued as
Eurocurrency Loans the rate of interest applicable to which is based upon the
Affected Eurocurrency Rate and that are not otherwise permitted to be converted
to or continued as ABR Loans by subsection 4.2 shall, upon demand by the
Revolving Credit Lenders the Revolving Credit Commitment Percentage of which
aggregate at least 51%, be immediately repaid by the applicable Borrower on the
last day of the then current Interest Period with respect thereto together with
accrued interest thereon or otherwise, at the option of the Parent Borrower,
shall remain outstanding and bear interest at a rate which reflects, as to each
of the Revolving Credit Lenders, such Revolving Credit Lender's cost of funding
such Eurocurrency Loans, as reasonably determined by such Revolving Credit
Lender, plus the Applicable Margin hereunder and (d) any outstanding
Eurocurrency Loans that are Tranche A Term Loans that were to have been
converted on the first day of such Interest Period to or continued as
Eurocurrency Loans the rate of interest applicable to which is based upon the
Affected Eurocurrency Rate and that are not otherwise permitted to be converted
to or continued as ABR Loans by subsection 4.2 shall, upon demand by the Tranche
A Term Loan Lenders the Tranche A Term Loan Percentage of which aggregate at
least 51%, be immediately repaid by the Parent Borrower on the last day of the
then current Interest Period with respect thereto together with accrued interest
thereon or otherwise, at the option of the Parent Borrower, shall remain
outstanding and bear interest at a rate which reflects, as to each of the
Tranche A Term Loan Lenders, such Tranche A Term Loan Lender's cost of funding
such Eurocurrency Loans, as reasonably determined by such Tranche A Term Loan
Lender, plus the Applicable Margin hereunder. If any such repayment occurs on a
day which is not the last day of the then current Interest Period with respect
to such affected Eurocurrency Loan, the applicable Borrower shall pay to each of
the applicable Lenders such amounts, if any, as may be required pursuant to
subsection 4.12. Until such notice has been withdrawn by the Administrative
Agent, no further Eurocurrency Loans the rate of interest applicable to which is
based upon the Affected Eurocurrency Rate shall be made or continued as such,
nor shall any of the Borrowers have the right to convert ABR Loans to
Eurocurrency Loans the rate of interest applicable to which is based upon the
Affected Eurocurrency Rate.
4.8 Pro Rata Treatment and Payments. (a) Subject to subsection
4.8(c), each borrowing of Revolving Credit Loans (other than Swing Line Loans)
by any of the Borrowers from the Revolving Credit Lenders hereunder shall be
made, each payment by any of the Borrowers on account
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51
of any commitment fee in respect of the Revolving Credit Commitments hereunder
shall be allocated by the Administrative Agent and any reduction of the
Revolving Credit Commitments of the Revolving Credit Lenders shall be allocated
by the Administrative Agent, pro rata according to the relevant Revolving Credit
Commitment Percentages of the Revolving Credit Lenders. Subject to subsection
4.8(c), each payment (including each prepayment) by any of the Borrowers on
account of principal of and interest on any Revolving Credit Loans shall be
allocated by the Administrative Agent pro rata according to the respective
outstanding principal amounts of such Revolving Credit Loans then held by the
Revolving Credit Lenders. Each payment (including each prepayment) by any of the
Borrowers on account of principal of and interest on any Term Loans shall,
subject to subsection 4.4(g), be allocated by the Administrative Agent pro rata
according to the respective outstanding principal amounts of such Term Loans
then held by the Term Loan Lenders. All payments (including prepayments) to be
made by any of the Borrowers hereunder and under any Notes, whether on account
of principal, interest, fees, Reimbursement Obligations or otherwise, shall be
made without set-off, counterclaim or, except as permitted under subsection
4.11, other deduction and shall be made prior to 1:00 P.M., New York City time,
on the due date thereof to the Administrative Agent, for the account of the
Lenders holding the relevant Loans or the L/C Participants, as the case may be,
at the Administrative Agent's office specified in subsection 11.2, in Dollars
or, in the case of Eurocurrency Loans outstanding in any Designated Foreign
Currency and L/C Obligations in any Designated Foreign Currency, such Designated
Foreign Currency and, whether in Dollars or any Designated Foreign Currency, in
immediately available funds. Payments received by the Administrative Agent after
such time shall be deemed to have been received on the next Business Day. The
Administrative Agent shall distribute such payments to such Lenders, if any such
payment is received prior to 1:00 P.M., New York City time, on a Business Day,
in like funds as received prior to the end of such Business Day and otherwise
the Administrative Agent shall distribute such payment to such Lenders on the
next succeeding Business Day. If any payment hereunder (other than payments on
the Eurocurrency Loans) becomes due and payable on a day other than a Business
Day, the maturity of such payment shall be extended to the next succeeding
Business Day, and, with respect to payments of principal, interest thereon shall
be payable at the then applicable rate during such extension. If any payment on
a Eurocurrency Loan becomes due and payable on a day other than a Business Day,
the maturity of such payment shall be extended to the next succeeding Business
Day (and, with respect to payments of principal, interest thereon shall be
payable at the then applicable rate during such extension) unless the result of
such extension would be to extend such payment into another calendar month, in
which event such payment shall be made on the immediately preceding Business
Day.
(b) Unless the Administrative Agent shall have been notified in
writing by any Revolving Credit Lender prior to a borrowing that such Revolving
Credit Lender will not make the amount that would constitute its Revolving
Credit Commitment Percentage of such borrowing available to the Administrative
Agent, the Administrative Agent may assume that such Revolving Credit Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to any of the
Borrowers in respect of such borrowing a corresponding amount. If such amount is
not made available to the Administrative Agent by the required time on the
Borrowing Date therefor, such Revolving Credit Lender shall pay to the
Administrative Agent, on demand, such amount with interest thereon at a rate
equal to (i) in the case of any Loans to be made in Dollars, the daily average
Federal Funds Effective Rate or (ii) in the case of any Revolving Credit Loans
to be made in any Designated Foreign Currency, the rate customary in such
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52
Designated Foreign Currency for settlement of similar inter-bank obligations, as
quoted by the Administrative Agent, in each case for the period until such
Revolving Credit Lender makes such amount immediately available to the
Administrative Agent. A certificate of the Administrative Agent submitted to any
Revolving Credit Lender with respect to any amounts owing under this subsection
shall be conclusive in the absence of manifest error. If such Revolving Credit
Lender's Revolving Credit Commitment Percentage of such borrowing is not made
available to the Administrative Agent by such Revolving Credit Lender within
three Business Days of such Borrowing Date, (x) the Administrative Agent shall
notify the Parent Borrower of the failure of such Revolving Credit Lender to
make such amount available to the Administrative Agent and the Administrative
Agent shall also be entitled to recover such amount with interest thereon at the
rate per annum applicable to in the case of any Loans to be made in Dollars, ABR
Loans hereunder or, in the case of Loans to be made in any Designated Foreign
Currency, the rate per annum referred to in clause (ii) of the second preceding
sentence in respect of such Designated Foreign Currency plus the Applicable
Margin hereunder, on demand, from such Borrower and (y) then such Borrower may,
without waiving any rights it may have against such Revolving Credit Lender,
borrow a like amount on an unsecured basis from any commercial bank for a period
ending on the date upon which such Revolving Credit Lender does in fact make
such borrowing available, provided that at the time such borrowing is made and
at all times while such amount is outstanding such Borrower would be permitted
to borrow such amount pursuant to subsection 2.1.
(c) Notwithstanding any other provision contained herein, in the
event that any Revolving Credit Lender gives notice to the Administrative Agent
that it is unable to fund Revolving Credit Loans in any Designated Foreign
Currency (other than Euros and Sterling) at a reasonable cost to it, the
Administrative Agent shall, until such notice is withdrawn and to the extent
necessary in order to excuse such Revolving Credit Lender from making any
Revolving Credit Loans in such Designated Foreign Currency and to continue to
make available to the Borrowers the full aggregate amount of the Revolving
Credit Commitments, reallocate from time to time among the Revolving Credit
Lenders the outstanding Revolving Credit Loans denominated in Dollars and the
Revolving Credit Loans in such Designated Foreign Currency; provided that, in
the event that the Revolving Credit Lenders the Revolving Credit Commitment
Percentage of which aggregate at least 51% give such notice to the
Administrative Agent, the Revolving Credit Lenders shall not be required to make
any Revolving Credit Loans in such Designated Foreign Currency until any such
notices have been withdrawn so that the Revolving Credit Lenders the Revolving
Credit Commitment Percentage of which aggregate at least 51% have either not
given any such notice or have withdrawn any such notice.
4.9 Illegality. Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof occurring after the Effective Date shall make it unlawful
for any Lender to make or maintain any Eurocurrency Loans as contemplated by
this Agreement ("Affected Eurocurrency Loans"), (a) such Lender shall promptly
give written notice of such circumstances to the Parent Borrower and the
Administrative Agent (which notice shall be withdrawn whenever such
circumstances no longer exist), (b) the commitment of such Lender hereunder to
make Affected Eurocurrency Loans, continue Affected Eurocurrency Loans as such
and convert ABR Loans to Affected Eurocurrency Loans shall forthwith be
cancelled and, until such time as it shall no longer be unlawful for such Lender
to make or maintain Affected Eurocurrency Loans, such Lender shall then have a
commitment only to make an ABR Loan when an Affected Eurocurrency Loan is
requested (to the extent otherwise permitted by subsection 4.2), (c) such
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Lender's Loans then outstanding as Affected Eurocurrency Loans, if any, shall be
converted automatically to ABR Loans on the respective last days of the then
current Interest Periods with respect to such Loans or within such earlier
period as required by law (to the extent otherwise permitted by subsection 4.2)
and (d) such Lender's Loans then outstanding as Affected Eurocurrency Loans, if
any, not otherwise permitted to be converted to ABR Loans by subsection 4.2
shall, upon notice to the Parent Borrower, be prepaid with accrued interest
thereon on the last day of the then current Interest Period with respect thereto
(or such earlier date as may be required by any such Requirement of Law). If any
such conversion of an Affected Eurocurrency Loan occurs on a day which is not
the last day of the then current Interest Period with respect thereto, the
applicable Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to subsection 4.12.
4.10 Requirements of Law. (a) If the adoption of or any change in
any Requirement of Law or in the interpretation or application thereof
applicable to any Lender, or compliance by any Lender with any request or
directive (whether or not having the force of law) from any central bank or
other Governmental Authority, in each case made subsequent to the Effective Date
(or, if later, the date on which such Lender becomes a Lender):
(i) shall subject such Lender to any tax of any kind whatsoever with
respect to any Letter of Credit, any Application or any Eurocurrency Loans
made by it or its obligation to make Eurocurrency Loans, or change the
basis of taxation of payments to such Lender in respect thereof (except
for Non-Excluded Taxes covered by subsection 4.11 (including Non-Excluded
Taxes imposed solely by reason of any failure of such Lender to comply
with its obligations (if any) under subsection 4.11(b) or (c)) and changes
in taxes measured by or imposed upon the overall net income, or franchise
taxes, or taxes measured by or imposed upon overall capital or net worth,
or branch taxes (in the case of such capital, net worth or branch taxes,
imposed in lieu of such net income tax), of such Lender or its applicable
lending office, branch, or any affiliate thereof);
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Lender which is not otherwise included in the determination
of the Eurocurrency Rate hereunder; or
(iii) shall impose on such Lender any other condition (excluding any
tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurocurrency Loans or issuing or participating in
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, upon notice to the Parent Borrower from such
Lender, through the Administrative Agent, in accordance herewith, the applicable
Borrower shall promptly pay such Lender, upon its demand, any additional amounts
necessary to compensate such Lender for such increased cost or reduced amount
receivable, provided that, in any such case, such Borrower may elect to convert
the Eurocurrency Loans made by such Lender hereunder to ABR Loans (to the extent
otherwise permitted
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54
by subsection 4.2) by giving the Administrative Agent at least one Business
Day's notice of such election, in which case such Borrower shall promptly pay to
such Lender, upon demand, without duplication, such amounts, if any, as may be
required pursuant to this subsection and such amounts, if any, as may be
required pursuant to subsection 4.12. If any Lender becomes entitled to claim
any additional amounts pursuant to this subsection, it shall provide prompt
notice thereof to the Parent Borrower, through the Administrative Agent,
certifying (x) that one of the events described in this paragraph (a) has
occurred and describing in reasonable detail the nature of such event, (y) as to
the increased cost or reduced amount resulting from such event and (z) as to the
additional amount demanded by such Lender and a reasonably detailed explanation
of the calculation thereof. Such a certificate as to any additional amounts
payable pursuant to this subsection submitted by such Lender, through the
Administrative Agent, to the Parent Borrower shall be conclusive in the absence
of manifest error. This covenant shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.
(b) If any Lender shall have determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority, in each case, made subsequent to the Effective Date (or, if later,
the date on which such Lender becomes a Lender), does or shall have the effect
of reducing the rate of return on such Lender's or such corporation's capital as
a consequence of its obligations hereunder or under or in respect of any Letter
of Credit to a level below that which such Lender or such corporation could have
achieved but for such change or compliance (taking into consideration such
Lender's or such corporation's policies with respect to capital adequacy) by an
amount deemed by such Lender to be material, then from time to time, within ten
Business Days after submission by such Lender to the Parent Borrower (with a
copy to the Administrative Agent) of a written request therefor certifying (x)
that one of the events described in this paragraph (b) has occurred and
describing in reasonable detail the nature of such event, (y) as to the
reduction of the rate of return on capital resulting from such event and (z) as
to the additional amount or amounts demanded by such Lender and a reasonably
detailed explanation of the calculation thereof, the applicable Borrower shall
pay to such Lender such additional amount or amounts as will compensate such
Lender for such reduction. Such a certificate as to any additional amounts
payable pursuant to this subsection submitted by such Lender, through the
Administrative Agent, to the Parent Borrower shall be conclusive in the absence
of manifest error. This covenant shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.
4.11 Taxes. (a) Except as provided below in this subsection, all
payments made by any of the Borrowers under this Agreement and any Notes shall
be made free and clear of, and without deduction or withholding for or on
account of, any present or future income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority, excluding
taxes measured by or imposed upon the overall net income (including net income
taxes imposed by means of a backup withholding tax) of any Lender or its
applicable lending office, or any branch or affiliate thereof, and all franchise
taxes, branch taxes, taxes on doing business or taxes measured by or imposed
upon the overall capital or net worth of any Lender or its applicable lending
office, or any branch or affiliate thereof, in each case imposed: (i) by the
jurisdiction under the laws of which such Lender, applicable lending
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office, branch or affiliate is organized or is located, or in which its
principal executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii) by reason
of any connection between the jurisdiction imposing such tax and such Lender,
applicable lending office, branch or affiliate other than a connection arising
solely from such Lender having executed, delivered or performed its obligations
under, or received payment under or enforced, this Agreement or any Notes. If
any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings ("Non-Excluded Taxes") are required to be withheld from any
amounts payable to the Administrative Agent or any Lender hereunder or under any
Notes, the amounts so payable to the Administrative Agent or such Lender shall
be increased to the extent necessary to yield to the Administrative Agent or
such Lender (after payment of all Non-Excluded Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement and any Notes, provided, however, that any of the Borrowers shall be
entitled to deduct and withhold any Non-Excluded Taxes and shall not be required
to increase any such amounts payable to any Lender with respect to Non-Excluded
Taxes (i) that are attributable to such Lender's failure to comply with the
requirements of paragraph (b) or (c) of this subsection or (ii) that are U.S.
withholding taxes imposed on amounts payable to such Lender at the time such
Lender becomes a party to this Agreement. Whenever any Non-Excluded Taxes are
payable by any of the Borrowers, as promptly as possible thereafter the
applicable Borrower shall send to the Administrative Agent for its own account
or for the account of such Lender, as the case may be, a certified copy of an
original official receipt received by such Borrower showing payment thereof. If
any of the Borrowers fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative Agent the
required receipts or other required documentary evidence, such Borrower shall
indemnify the Administrative Agent and the Lenders for any incremental taxes,
interest or penalties that may become payable by the Administrative Agent or any
Lender as a result of any such failure. The agreements in this subsection shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.
(b) Each Lender that is not a United States person (as defined in
Section 7701(a)(30) of the Code) shall:
(X) (i) on or before the date of any payment by any of the Borrowers
under this Agreement or any Notes to such Lender, deliver to the Parent
Borrower and the Administrative Agent two duly completed copies of United
States Internal Revenue Service Form W-8BEN or W-8ECI, or successor
applicable form, as the case may be and such other forms and
certifications as may be required under applicable law, in order to
establish that it is entitled to receive payments under this Agreement and
any Notes without deduction or withholding of any United States federal
income taxes;
(ii) deliver to the Parent Borrower and the Administrative Agent two
further copies of any such form or certification on or before the date
that any such form or certification expires or becomes obsolete and after
the occurrence of any event requiring a change in the most recent form
previously delivered by it to the Parent Borrower; and
(iii) obtain such extensions of time for filing and complete such
forms or certifications as may reasonably be requested by the Parent
Borrower or the Administrative Agent; or
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(Y) in the case of any such Lender that is not a "bank" within the
meaning of Section 881(c)(3)(A) of the Code and that is not entitled to
comply with subparagraph (X) hereof, (i) represent to the Parent Borrower
(for the benefit of each of the Borrowers and the Administrative Agent)
that it is not a bank within the meaning of Section 881(c)(3)(A) of the
Code, (ii) agree to furnish to the Parent Borrower on or before the date
of any payment by any of the Borrowers, with a copy to the Administrative
Agent, (A) a certificate substantially in the form of Exhibit C (any such
certificate a "U.S. Tax Compliance Certificate") and (B) two accurate and
complete original signed copies of Internal Revenue Service Form W-8BEN,
or successor applicable form certifying to such Lender's legal entitlement
at the date of such certificate to an exemption from U.S. withholding tax
under the provisions of Section 871(h) or 881(c) of the Code with respect
to payments to be made under this Agreement and any Notes (and to deliver
to the Parent Borrower and the Administrative Agent two further copies of
such form on or before the date it expires or becomes obsolete and after
the occurrence of any event requiring a change in the most recently
provided form and, if necessary, obtain any extensions of time reasonably
requested by the Parent Borrower or the Administrative Agent for filing
and completing such forms), and (iii) agree, to the extent legally
entitled to do so, upon reasonable request by the Parent Borrower, to
provide to the Parent Borrower (for the benefit of each of the Borrowers
and the Administrative Agent) such other forms as may be reasonably
required in order to establish the legal entitlement of such Lender to an
exemption from withholding with respect to payments under this Agreement
and any Notes (for the avoidance of doubt, in determining the
reasonableness of a request under this clause (iii), such Lender shall be
entitled to consider the cost (to the extent unreimbursed by the Parent
Borrower) which would be imposed on such Lender of complying with such
request);
unless in any such case any change in treaty, law or regulation has occurred
after the date such Person becomes a Lender hereunder which renders all such
forms inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender so advises the
Parent Borrower and the Administrative Agent.
(c) Each Revolving Credit Lender that is not incorporated or
organized under the laws of the jurisdiction under which a Foreign Subsidiary
Borrower is incorporated or organized shall, upon request by such Foreign
Subsidiary Borrower, deliver to such Foreign Subsidiary Borrower or the
applicable governmental or taxing authority, as the case may be, any form or
certificate required in order that any payment by such Foreign Subsidiary
Borrower under this Agreement or any Notes to such Revolving Credit Lender may
be made free and clear of, and without deduction or withholding for or on
account of any Non-Excluded Taxes (or to allow any such deduction or withholding
to be at a reduced rate) imposed on such payment under the laws of the
jurisdiction under which such Foreign Subsidiary Borrower is incorporated or
organized, provided that such Lender is legally entitled to complete, execute
and deliver such form or certificate and such completion, execution or
submission would not materially prejudice the legal position of such Revolving
Credit Lender.
(d) Each Person that shall become a Lender or a Participant pursuant
to subsection 11.6 shall, upon the effectiveness of the related transfer, be
required to provide all of the forms, certifications and statements required
pursuant to this subsection, provided that, in the case of a Participant, the
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obligations of such Participant pursuant to paragraph (b) or (c) of this
subsection shall be determined as if such Participant were a Lender except that
such Participant shall furnish all such required forms, certifications and
statements to the Lender from which the related participation shall have been
purchased.
4.12 Indemnity. Each of the Borrowers agrees to indemnify each
Lender and to hold each Lender harmless from any loss or expense which such
Lender may sustain or incur (other than through such Lender's gross negligence
or willful misconduct) as a consequence of (a) default by such Borrower in
making a borrowing of, conversion into or continuation of Eurocurrency Loans
after the Parent Borrower has given a notice requesting the same in accordance
with the provisions of this Agreement, (b) default by such Borrower in making
any prepayment of Eurocurrency Loans after the Parent Borrower has given a
notice thereof in accordance with the provisions of this Agreement or (c) the
making of a prepayment or conversion of Eurocurrency Loans on a day which is not
the last day of an Interest Period with respect thereto. Such indemnification
may include an amount equal to the excess, if any, of (i) the amount of interest
which would have accrued on the amount so prepaid, or converted, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or conversion or of such failure to borrow, convert or continue to
the last day of the applicable Interest Period (or, in the case of a failure to
borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for
such Eurocurrency Loans provided for herein (excluding, however, the Applicable
Margin included therein, if any) over (ii) the amount of interest (as reasonably
determined by such Lender) which would have accrued to such Lender on such
amount by placing such amount on deposit for a comparable period with leading
banks in the interbank eurocurrency market. A certificate as to any amounts
payable pursuant to this subsection submitted to the Parent Borrower by any
Lender shall be conclusive in the absence of manifest error. This covenant shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.
4.13 Certain Rules Relating to the Payment of Additional Amounts.
(a) Upon the request, and at the expense, of the applicable Borrower, each
Lender to which any of the Borrowers is required to pay any additional amount
pursuant to subsection 4.10 or 4.11, and any Participant in respect of whose
participation such payment is required, shall reasonably afford such Borrower
the opportunity to contest, and reasonably cooperate with such Borrower in
contesting, the imposition of any Non-Excluded Tax giving rise to such payment;
provided that (i) such Lender shall not be required to afford such Borrower the
opportunity to so contest unless such Borrower shall have confirmed in writing
to such Lender its obligation to pay such amounts pursuant to this Agreement and
(ii) such Borrower shall reimburse such Lender for its reasonable attorneys' and
accountants' fees and disbursements incurred in so cooperating with such
Borrower in contesting the imposition of such Non-Excluded Tax; provided,
however that notwithstanding the foregoing no Lender shall be required to afford
any Borrower the opportunity to contest, or cooperate with such Borrower in
contesting, the imposition of any Non-Excluded Taxes, if such Lender in its sole
discretion in good faith determines that to do so would have an adverse effect
on it.
(b) If a Lender changes its applicable lending office (other than
pursuant to paragraph (c) below) and the effect of the change, as of the date of
the change, would be to cause any of the
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Borrowers to become obligated to pay any additional amount under subsection 4.10
or 4.11, such Borrower shall not be obligated to pay such additional amount.
(c) If a condition or an event occurs which would, or would upon the
passage of time or giving of notice, result in the payment of any additional
amount to any Lender by any of the Borrowers pursuant to subsection 4.10 or
4.11, such Lender shall promptly notify the applicable Borrower and the
Administrative Agent and shall take such steps as may reasonably be available to
it and acceptable to such Borrower to mitigate the effects of such condition or
event (which shall include efforts to rebook the Loans held by such Lender at
another lending office, or through another branch or an affiliate, of such
Lender); provided that such Lender shall not be required to take any step that,
in its reasonable judgment, would be materially disadvantageous to its business
or operations or would require it to incur additional costs (unless the Parent
Borrower agrees to reimburse such Lender for the reasonable incremental
out-of-pocket costs thereof).
(d) If any of the Borrowers shall become obligated to pay additional
amounts pursuant to subsection 4.10 or 4.11 and any affected Lender shall not
have promptly taken steps necessary to avoid the need for payments under
subsection 4.10 or 4.11, the applicable Borrower shall have the right, for so
long as such obligation remains, (x) with the assistance of the Administrative
Agent, to seek one or more substitute Lenders reasonably satisfactory to the
Administrative Agent and such Borrower to purchase the affected Loan, in whole
or in part, at an aggregate price no less than such Loan's principal amount plus
accrued interest, and assume the affected obligations under this Agreement, or
(y) upon at least four Business Days' irrevocable notice to the Administrative
Agent, to prepay the affected Loan, in whole or in part, subject to subsections
4.4(k) and 4.12, without premium or penalty. In the case of the substitution of
a Lender, the applicable Borrower, the Administrative Agent, the affected
Lender, and any substitute Lender shall execute and deliver an appropriately
completed Assignment and Acceptance pursuant to subsection 11.6(c) to effect the
assignment of rights to, and the assumption of obligations by, the substitute
Lender; provided that any fees required to be paid pursuant to subsection
11.6(e) in connection with such assignment shall be paid by such Borrower. In
the case of a prepayment of an affected Loan, the amount specified in the notice
shall be due and payable on the date specified therein, together with any
accrued interest to such date on the amount prepaid. In the case of each of the
substitution of a Lender and of the prepayment of an affected Loan, the
applicable Borrower shall first pay the affected Lender any additional amounts
owing under subsections 4.10 and 4.11 (as well as any commitment fees and other
amounts then due and owing to such Lender) prior to such substitution or
prepayment.
(e) If the Administrative Agent or any Lender receives a refund in
respect of taxes for which any of the Borrowers has made additional payments
pursuant to subsection 4.10(a) or 4.11(a), the Administrative Agent or such
Lender, as the case may be, shall promptly pay such refund (together with any
interest with respect thereto received from the relevant taxing authority) to
such Borrower, provided, however, that such Borrower agrees promptly to return
such refund (together with any interest with respect thereto due to the relevant
taxing authority) (free of all Non-Excluded Taxes) to the Administrative Agent
or the applicable Lender, as the case may be, upon receipt of a notice that such
refund is required to be repaid to the relevant taxing authority.
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(f) The obligations of a Lender or Participant under this subsection
4.13 shall survive the termination of this Agreement and the payment of the
Loans and all amounts payable hereunder.
4.14 Controls on Prepayment if Aggregate Outstanding Revolving
Credit Exceeds Aggregate Revolving Credit Commitments. (a) The Parent Borrower
will implement and maintain internal controls to monitor the borrowings and
repayments of Loans by the Borrowers and the issuance of and drawings under
Letters of Credit, with the object of preventing any request for an Extension of
Credit that would result in the Aggregate Outstanding Revolving Credit with
respect to all of the Revolving Credit Lenders (including the Swing Line Lender)
being in excess of the aggregate Revolving Credit Commitments then in effect and
of promptly identifying any circumstance where, by reason of changes in exchange
rates, the Aggregate Outstanding Revolving Credit with respect to all of the
Revolving Credit Lenders (including the Swing Line Lender) exceeds the aggregate
Revolving Credit Commitments then in effect. In the event that at any time the
Parent Borrower determines that the Aggregate Outstanding Revolving Credit with
respect to all of the Revolving Credit Lenders (including the Swing Line Lender)
exceeds the aggregate Revolving Credit Commitments then in effect by more than
5%, the Parent Borrower will, as soon as practicable but in any event within
five Business Days of making such determination, first, make such repayments or
prepayments of Loans (together with interest accrued to the date of such
repayment or prepayment), second, pay any Reimbursement Obligations then
outstanding and, third, cash collateralize any outstanding L/C Obligations on
terms reasonably satisfactory to the Administrative Agent, as shall be necessary
to cause the Aggregate Outstanding Revolving Credit with respect to all of the
Revolving Credit Lenders (including the Swing Line Lender) to no longer exceed
the aggregate Revolving Credit Commitments then in effect. If any such repayment
or prepayment of a Eurocurrency Loan pursuant to this subsection occurs on a day
which is not the last day of the then current Interest Period with respect
thereto, the Parent Borrower shall pay to the Revolving Credit Lenders such
amounts, if any, as may be required pursuant to subsection 4.12.
(b) The Administrative Agent will calculate the Aggregate
Outstanding Revolving Credit with respect to all of the Revolving Credit Lenders
(including the Swing Line Lender) from time to time, and in any event not less
frequently than once during each calendar week. In making such calculations, the
Administrative Agent will rely on the information most recently received by it
from the Swing Line Lender in respect of outstanding Swing Line Loans and from
the Issuing Lender in respect of outstanding L/C Obligations.
(c) In the event that on any date the Administrative Agent
calculates that the Aggregate Outstanding Revolving Credit with respect to all
of the Revolving Credit Lenders (including the Swing Line Lender) exceeds the
aggregate Revolving Credit Commitments then in effect by more than 5%, the
Administrative Agent will give notice to such effect to the Parent Borrower and
the Lenders. Following receipt of any such notice, the Parent Borrower will, as
soon as practicable but in any event within five Business Days of receipt of
such notice, first, make such repayments or prepayments of Loans (together with
interest accrued to the date of such repayment or prepayment), second, pay any
Reimbursement Obligations then outstanding and, third, cash collateralize any
outstanding L/C Obligations on terms reasonably satisfactory to the
Administrative Agent as shall be necessary to cause the Aggregate Outstanding
Revolving Credit with respect to all of the Revolving Credit Lenders (including
the Swing Line Lender) to no longer exceed the aggregate Revolving Credit
Commitments then in effect. If any
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60
such repayment or prepayment of a Eurocurrency Loan pursuant to this subsection
occurs on a day which is not the last day of the then current Interest Period
with respect thereto, the Parent Borrower shall pay to the Revolving Credit
Lenders such amounts, if any, as may be required pursuant to subsection 4.12.
SECTION 5. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and each Lender to make the
Extensions of Credit requested to be made by it on the Effective Date and on
each Borrowing Date thereafter, the Parent Borrower hereby represents and
warrants, on the Effective Date (both before and after giving effect to the
Acquisition), and on every Borrowing Date thereafter, to the Administrative
Agent and each Lender that:
5.1 Financial Condition. (a) The audited consolidated balance sheets
of the Parent Borrower and its consolidated Subsidiaries as of December 28,
1996, December 27, 1997 and December 26, 1998 and the audited consolidated
statements of income and of cash flows for the fiscal years ended on such dates
have heretofore been furnished to each Lender. Such financial statements
(including the notes thereto) (i) have been audited by KPMG Peat Marwick LLP in
the case of the financial statements as of December 28, 1996 and December 27,
1997 and by PricewaterhouseCoopers LLP in the case of the financial statements
as of December 26, 1998, (ii) have been prepared in accordance with GAAP
consistently applied throughout the periods covered thereby and (iii) (on the
basis disclosed in the footnotes to such financial statements) present fairly,
in all material respects, the consolidated financial condition, results of
operations and cash flows of the Parent Borrower and its consolidated
Subsidiaries as of such dates and for such periods. The unaudited interim
consolidated balance sheets of the Parent Borrower and its consolidated
Subsidiaries as at the end of, and the related unaudited interim consolidated
statements of income and of cash flows for, each fiscal month ended after
December 26, 1998 and prior to the Effective Date have heretofore been furnished
to each Lender. During the period from December 26, 1998 to and including the
Effective Date, there has been no sale, transfer or other disposition by the
Parent Borrower or its Subsidiaries of any material part of the business or
property of the Parent Borrower and its consolidated Subsidiaries, taken as a
whole, and, except as provided in the Acquisition Agreement, no purchase or
other acquisition by any of them of any business or property (including any
Capital Stock of any other Person) material in relation to the consolidated
financial condition of the Parent Borrower and its consolidated Subsidiaries,
taken as a whole, in each case, which is not reflected in the foregoing
financial statements or in the notes thereto and has not otherwise been
disclosed in writing to the Lenders on or prior to the Effective Date.
(b) The audited combined balance sheets of the Acquired Business as
of September 30, 1996, September 30, 1997 and September 30, 1998 and the audited
combined statements of income and of cash flows for the fiscal years ended on
such dates have heretofore been furnished to each Lender. Such financial
statements (including the notes thereto) (i) have been audited by Ernst & Young,
(ii) have been prepared in accordance with U.K. GAAP consistently applied
throughout the periods covered thereby, (iii) set forth at Note 22 an
explanation of the significant differences between U.K. GAAP and U.S. GAAP and
(iv) (on the basis disclosed in the footnotes to such financial statements)
present fairly, in all material respects, the combined financial condition,
results of operations and cash flows of the
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61
Acquired Business as of such dates and for such periods. The unaudited interim
combined balance sheets of the Acquired Business as at the end of, and the
related unaudited interim combined statements of income and of cash flows for,
the six-month period ended March 31, 1999 and for the nine-month period ended
June 30, 1999 have heretofore been furnished to each Lender. During the period
from September 30, 1998 to and including the Effective Date, except as provided
in the Acquisition Agreement, there has been no sale, transfer or other
disposition by the Acquired Business of any material part of the business or
property of the Acquired Business and no purchase or other acquisition by the
Acquired Business of any business or property (including any Capital Stock of
any other Person) material in relation to the combined financial condition of
the Acquired Business, in each case, which is not reflected in the foregoing
financial statements or in the notes thereto and has not otherwise been
disclosed in writing to the Lenders on or prior to the Effective Date.
(c) The pro forma balance sheet and statements of income and of cash
flows of the Parent Borrower and its consolidated Subsidiaries (the "Pro Forma
Financial Statements"), copies of which have heretofore been furnished to each
Lender, are the balance sheet and statements of income and of cash flows of the
Parent Borrower and its consolidated Subsidiaries for the twelve-month period
ended June 30, 1999 (the "Pro Forma Date"), adjusted to give effect (as if such
events had occurred on such date) to (i) the consummation on the Effective Date
of the Acquisition (and in any event excluding any pre-closing or post-closing
adjustments in respect thereof, including any purchase price adjustments, and
the final allocation of the purchase price therefor), (ii) the making of the
Loans to be made on the Effective Date in an aggregate principal amount of not
more than $390,000,000, (iii) the refinancing of certain existing Indebtedness
of the Parent Borrower, including, without limitation, Indebtedness outstanding
under the Existing Credit Agreement, and (iv) the payment of estimated fees,
expenses, financing costs and settlement of intercompany accounts related to the
transactions contemplated hereby and thereby. The Pro Forma Financial Statements
were prepared in good faith on the basis of reasonable estimates (it being
understood that there has been no allocation of the purchase price for the
Acquisition).
5.2 No Change; Solvent. Since March 31, 1999, (a) there has been no
event, occurrence, fact or change (including any event, occurrence, fact,
condition or change resulting from economic recession, war or other major global
turmoil) that, individually or in the aggregate, is or would reasonably be
expected to be materially adverse to the business, operations, assets,
liabilities or results of operations of the Parent Borrower and its Subsidiaries
(after giving effect to the Acquisition) taken as a whole (a "Material Adverse
Change"), provided, however, that any adverse change in the U.S. or global
financial or capital markets shall not alone constitute a Material Adverse
Change and (b) except as permitted under this Agreement or (at any time prior to
the consummation of the Acquisition on the Effective Date) the Transaction
Documents, and except for dividends or other distributions by the Acquired
Business prior to the execution and delivery of the Acquisition Agreement, no
dividends or other distributions have been declared, paid or made upon the
Capital Stock of Holding, the Parent Borrower or the Acquired Business nor has
any of the Capital Stock of Holding, the Parent Borrower or the Acquired
Business been redeemed, retired, purchased or otherwise acquired for value by
Holding, the Parent Borrower or the Acquired Business or any of their respective
Subsidiaries. As of the Effective Date, after giving effect to (i) the
consummation of the Acquisition, (ii) the making of Loans to be made on the
Effective Date in an aggregate principal amount of not more than $390,000,000
and (iii) the payment of estimated fees, expenses and financing costs related to
the
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transactions contemplated hereby and thereby, each of Holding, the Parent
Borrower and the Acquired Business is Solvent.
5.3 Corporate Existence; Compliance with Law. Each of the Loan
Parties (a) is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or formation, (b) has the
corporate power and authority, and the legal right, to own and operate its
property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged, except to the extent that the failure
to have such legal right would not be reasonably expected to have a Material
Adverse Effect, (c) is duly qualified as a foreign corporation or limited
liability company and in good standing under the laws of each jurisdiction where
its ownership, lease or operation of property or the conduct of its business
requires such qualification, other than in such jurisdictions where the failure
to be so qualified and in good standing would not be reasonably expected to have
a Material Adverse Effect, and (d) is in compliance with all Requirements of
Law, except to the extent that the failure to comply therewith would not, in the
aggregate, be reasonably expected to have a Material Adverse Effect.
5.4 Corporate Power; Authorization; Enforceable Obligations. Each
Loan Party has the corporate power and authority, and the legal right, to make,
deliver and perform the Loan Documents to which it is a party and, in the case
of each of the Borrowers, to obtain Extensions of Credit hereunder, and each
such Loan Party has taken all necessary corporate action to authorize the
execution, delivery and performance of the Loan Documents to which it is a party
and, in the case of each of the Borrowers, to authorize the Extensions of Credit
on the terms and conditions of this Agreement, any Notes and the Applications.
No consent or authorization of, filing with, notice to or other similar act by
or in respect of, any Governmental Authority or any other Person is required to
be obtained or made by or on behalf of any Loan Party in connection with the
execution, delivery, performance, validity or enforceability of the Loan
Documents to which it is a party or, in the case of each of the Borrowers, with
the Extensions of Credit hereunder, except for (i) consents, authorizations,
notices and filings described in Schedule 5.4, all of which have been obtained
or made, (ii) filings to perfect the Liens created by the Security Documents,
(iii) filings pursuant to the Assignment of Claims Act of 1940, as amended (31
U.S.C. ss.3727 et seq.) in respect of Accounts and contracts of the Parent
Borrower and its Subsidiaries, the Obligor on which is the United States of
America or any department, agency or instrumentality thereof and (iv) consents,
authorizations, notices and filings which the failure to obtain or make would
not reasonably be expected to have a Material Adverse Effect. This Agreement has
been duly executed and delivered by each of the Borrowers, and each other Loan
Document to which any Loan Party is a party, has been, or will be duly executed
and delivered on behalf of such Loan Party. This Agreement constitutes a legal,
valid and binding obligation of each of the Borrowers, and each other Loan
Document to which any Loan Party is a party as executed and delivered does
constitute, or when executed and delivered, will constitute, a legal, valid and
binding obligation of such Loan Party, enforceable against such Loan Party in
accordance with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law).
5.5 No Legal Bar. Except as previously disclosed in writing to the
Lenders on or prior to the Effective Date, the execution, delivery and
performance of the Loan Documents by the Loan
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63
Parties, the Extensions of Credit hereunder and the use of the proceeds thereof
(a) will not violate any Requirement of Law or Contractual Obligation of any
Loan Party in any respect that would reasonably be expected to have a Material
Adverse Effect and (b) will not result in, or require, the creation or
imposition of any Lien (other than the Liens created by the Security Documents)
on any of its or their respective properties or revenues pursuant to any such
Requirement of Law or Contractual Obligation.
5.6 No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the knowledge of the Parent Borrower, threatened by or against Holding or any
of its Subsidiaries or against any of its or their respective properties or
revenues, which is not subject to indemnification by the Seller pursuant to the
Acquisition Agreement, and (a) is so pending or threatened on or prior to the
Effective Date and relates to any of the Loan Documents or any of the
transactions contemplated hereby or thereby or (b) which would be reasonably
expected to have a Material Adverse Effect.
5.7 No Default. Neither Holding, the Parent Borrower nor any of its
Subsidiaries is in default under or with respect to any of its Contractual
Obligations in any respect which would be reasonably expected to have a Material
Adverse Effect. No Default or Event of Default has occurred and is continuing.
5.8 Ownership of Property; Liens. Each of Holding, the Parent
Borrower and its Subsidiaries has good record and marketable title in fee simple
to, or a valid leasehold interest in, all its material real property, and good
title to, or a valid leasehold interest in, all its other material property, and
none of such property is subject to any Lien, except for Liens permitted by
subsection 8.3.
5.9 Intellectual Property. Each of the Parent Borrower and each of
its Subsidiaries owns, or has the legal right to use, all United States patents,
patent applications, trademarks, trademark applications, tradenames, service
marks, copyrights, technology, know-how and processes necessary for each of them
to conduct its business as currently conducted or as proposed to be conducted
immediately following the Effective Date (the "Intellectual Property") except
for those the failure to own or have such legal right to use would not be
reasonably expected to have a Material Adverse Effect. No claim has been
asserted and is pending by any Person challenging or questioning the use of any
such Intellectual Property or the validity or effectiveness of any such
Intellectual Property, nor does the Parent Borrower know of any such claim, and,
to the knowledge of the Parent Borrower, the use of such Intellectual Property
by the Parent Borrower and its Subsidiaries does not infringe on the rights of
any Person, except for such claims and infringements that, in the aggregate,
would not be reasonably expected to have a Material Adverse Effect.
5.10 No Burdensome Restrictions. Except as previously disclosed in
writing to the Lenders on or prior to the Effective Date, no Requirement of Law
or Contractual Obligation of Holding, the Parent Borrower or any of its
Subsidiaries would be reasonably expected to have a Material Adverse Effect.
5.11 Taxes. To the knowledge of the Parent Borrower: each of
Holding, the Parent Borrower and its Subsidiaries has filed or caused to be
filed all United States federal income tax returns and all other material tax
returns which are required to be filed and has paid (a) all taxes shown to be
due and payable on said returns and (b) all taxes shown to be due and payable on
any assessments of
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which it has received notice made against it or any of its property and all
other taxes, fees or other charges imposed on it or any of its property by any
Governmental Authority (other than any (i) taxes, fees or other charges with
respect to which the failure to pay, in the aggregate, would not have a Material
Adverse Effect or (ii) taxes, fees or other charges the amount or validity of
which are currently being contested in good faith by appropriate proceedings
diligently conducted and with respect to which reserves in conformity with GAAP
have been provided on the books of Holding, the Parent Borrower or its
Subsidiaries, as the case may be); and no tax Lien has been filed, and no claim
is being asserted, with respect to any such tax, fee or other charge. The
preceding sentence shall not apply to any taxes, fees or other charges which are
subject to indemnification by the Seller under the Acquisition Agreement and
with respect to which the Parent Borrower has disclosed to the Administrative
Agent the failure to file or pay, the filing of a tax Lien, or the assertion of
a claim.
5.12 Federal Regulations. No part of the proceeds of any Loans or
any Letter of Credit will be used for "purchasing" or "carrying" any "margin
stock" within the respective meanings of each of the quoted terms under
Regulation U or for any purpose which violates the provisions of the Regulations
of the Board, including, without limitation, Regulation T, Regulation U or
Regulation X of the Board. If requested by any Lender or the Administrative
Agent, the Parent Borrower will furnish to the Administrative Agent and each
Lender a statement to the foregoing effect in conformity with the requirements
of FR Form G-3 or FR Form U-1 or such other similar form referred to in
Regulation T, Regulation U or Regulation X of the Board, as the case may be.
5.13 ERISA. During the five year period prior to each date as of
which this representation is made, or deemed made, with respect to any Plan (or,
with respect to (vi) or (viii) below, as of the date such representation is made
or deemed made), none of the following events or conditions, either individually
or in the aggregate, has resulted or is reasonably likely to result in a
liability to Holding, the Parent Borrower or any of its Subsidiaries which would
be reasonably expected to have a Material Adverse Effect: (i) a Reportable
Event; (ii) an "accumulated funding deficiency" (within the meaning of Section
412 of the Code or Section 302 of ERISA); (iii) any material noncompliance with
the applicable provisions of ERISA or the Code; (iv) a termination of a Single
Employer Plan (other than a standard termination pursuant to Section 4041(b) of
ERISA); (v) a Lien in favor of the PBGC or a Plan; (vi) Underfunding with
respect to any Single Employer Plan; (vii) a complete or partial withdrawal from
any Multiemployer Plan by Holding, the Parent Borrower or any Commonly
Controlled Entity; (viii) any liability of Holding, the Parent Borrower or any
Commonly Controlled Entity under ERISA if Holding, the Parent Borrower or any
such Commonly Controlled Entity were to withdraw completely from all
Multiemployer Plans as of the annual valuation date most closely preceding the
date on which this representation is made or deemed made; (ix) the
Reorganization or Insolvency of any Multiemployer Plan; and (x) an event or
condition with respect to which Holding, the Parent Borrower or any Commonly
Controlled Entity has incurred or could incur any liability in respect of a
Former Plan.
5.14 Collateral. Except with regard to (i) Liens on equipment
constituting fixtures, (ii) any reserved rights of the United States government
as required under law, (iii) Liens upon Patents, Patent Licenses, Trademarks and
Trademark Licenses to the extent that (a) such Liens cannot be perfected by the
filing of financing statements under the Uniform Commercial Code or by the
filing and acceptance thereof in the United States Patent and Trademark Office
or (b) such Patents, Patent
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Licenses, Trademarks and Trademark Licenses are not, individually or in the
aggregate, material to the business of the Parent Borrower and its Subsidiaries
taken as a whole, (iv) Liens on uncertificated securities, (v) Liens on
Collateral the perfection of which requires filings in or other actions under
the laws of jurisdictions outside of the United States of America, any State,
territory or dependency thereof or the District of Columbia (except to the
extent that such filings or other actions have been made or taken), (vi) Liens
on contracts or Accounts on which the United States of America or any
department, agency, or instrumentality thereof is the Obligor, (vii) Liens on
proceeds of Accounts, until transferred to or deposited in the Collateral
Proceeds Account, and (viii) the claims of creditors of Persons receiving goods
included as Collateral for "sale or return" within the meaning of Section 2-326
of the Uniform Commercial Code of the applicable jurisdiction, upon filing of
the financing statements delivered to the Administrative Agent by Holding, the
Parent Borrower and its Subsidiaries on the Effective Date in the jurisdictions
listed on Schedule 5.14 (which financing statements are in proper form for
filing in such jurisdictions) and the recording of the Mortgages (and the
recording of the Guarantee and Collateral Agreement, and the making of filings
in any other jurisdiction as may be necessary under any Requirement of Law after
the Effective Date) and the delivery to, and continuing possession by, the
Administrative Agent of all Instruments, Chattel Paper and Documents a security
interest in which is perfected by possession, the Liens created pursuant to each
Security Document, when executed and delivered, will constitute valid Liens on
and, to the extent provided therein, perfected security interests in the
collateral referred to in such Security Document (but as to the Copyrights and
the Copyright Licenses and accounts arising therefrom, only to the extent the
Uniform Commercial Code of the relevant jurisdiction, from time to time in
effect, is applicable) in favor of the Administrative Agent for the ratable
benefit of the Lenders, which Liens will be prior to all other Liens of all
other Persons, except for Liens permitted pursuant to the Loan Documents
(including, without limitation, those permitted to exist pursuant to subsection
8.3), and which Liens are enforceable as such as against all other Persons
(except, with respect to goods only, buyers in the ordinary course of business
to the extent provided in Section 9-307(1) of the Uniform Commercial Code as
from time to time in effect in the applicable jurisdiction), except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law) and an implied
covenant of good faith and fair dealing. Notwithstanding any other provision of
this Agreement, capitalized terms which are used in this subsection 5.14 and not
defined in this Agreement are so used as defined in the applicable Security
Document.
5.15 Investment Company Act; Other Regulations. None of the
Borrowers is an "investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act. None of
the Borrowers is subject to regulation under any federal or state statute or
regulation which limits its ability to incur Indebtedness as contemplated
hereby.
5.16 Subsidiaries. Schedule 5.16 sets forth all the Subsidiaries of
Holding at the Effective Date, the jurisdiction of their incorporation and the
direct or indirect ownership interest of Holding therein.
5.17 Purpose of Loans. The proceeds of the Term Loans, and not more
than $65,000,000 of the Revolving Credit Loans, shall be used by the Parent
Borrower (i) to finance a
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portion of the purchase price of the Acquisition, (ii) to refinance certain
existing Indebtedness of the Parent Borrower, including, without limitation,
Indebtedness outstanding under the Existing Credit Agreement, and (iii) to pay
certain transaction fees and expenses related to the Acquisition (such
transaction fees and expenses not to exceed $30,000,000). The proceeds of the
Revolving Credit Loans, the Swing Line Loans and the Letters of Credit shall be
used by the Borrowers to finance the working capital and business requirements
of the Parent Borrower and its Subsidiaries.
5.18 Environmental Matters. Other than exceptions to any of the
following that would not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect:
(a) To the knowledge of the Parent Borrower, the facilities and
properties owned, leased or operated by Holding, the Parent Borrower or any of
its Subsidiaries (the "Properties") and all operations at the Properties are in
compliance with all applicable Environmental Laws, and there is no violation of
any Environmental Law with respect to the Properties or the business operated by
Holding, the Parent Borrower or any of its Subsidiaries (the "Business"), and
there are no conditions relating to the Business or Properties that would be
reasonably likely to give rise to liability under any applicable Environmental
Law.
(b) To the knowledge of the Parent Borrower, the Properties do not
contain, and have not previously contained, any Materials of Environmental
Concern at, on or under the Properties in amounts or concentrations that
constitute or constituted a violation of, or would reasonably give rise to
liability under, Environmental Laws.
(c) Neither Holding, the Parent Borrower nor any of its Subsidiaries
has received any written or verbal notice of, or inquiry from any Governmental
Authority regarding, any violation, alleged violation, non-compliance, liability
or potential liability regarding environmental matters or compliance with
Environmental Laws with regard to any of the Properties or the Business, nor
does the Parent Borrower have knowledge or reason to believe that any such
notice will be received or is being threatened.
(d) To the knowledge of the Parent Borrower, Materials of
Environmental Concern have not been transported or disposed of from the
Properties, or generated, treated, stored or disposed of at, on or under any of
the Properties or any other location, in violation of, or in a manner that would
be reasonably likely to give rise to liability of Holding, the Parent Borrower
or any of its Subsidiaries under, any applicable Environmental Law, or
materially interfere with the continued operations of Holding, the Parent
Borrower or any of its Subsidiaries or materially impair the fair saleable value
of any of the Properties.
(e) No judicial proceeding or governmental or administrative action
is pending or, to the knowledge of the Parent Borrower, threatened, under any
Environmental Law to which Holding, the Parent Borrower or any of its
Subsidiaries is or will be named as a party, nor are there any consent decrees
or other decrees, consent orders, administrative orders or other orders, or
other administrative or judicial requirements outstanding under any
Environmental Law with respect to Holding, the Parent Borrower or any of its
Subsidiaries, the Properties or the Business.
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(f) There has been no release or, to the knowledge of the Parent
Borrower, threat of release of Materials of Environmental Concern at or from the
Properties, or arising from or related to the operations (including, without
limitation, disposal) of Holding, the Parent Borrower or any of its Subsidiaries
in connection with the Properties or otherwise in connection with the Business,
in violation of or in amounts or in a manner that would be reasonably likely to
give rise to liability under Environmental Laws.
(g) Neither Holding, the Parent Borrower nor any of its Subsidiaries
has assumed or retained, by contract or, to its knowledge, operation of law, any
known or suspected liabilities of any kind, fixed or contingent, as a result of
any violation or breach of applicable Environmental Law or with respect to any
contamination by any Materials of Environmental Concern.
5.19 No Material Misstatements. The written information, reports,
financial statements, exhibits and schedules furnished by or on behalf of
Holding, the Parent Borrower or the Acquired Business to the Administrative
Agent, the Other Representatives and the Lenders in connection with the
negotiation of any Loan Document or included therein or delivered pursuant
thereto, taken as a whole, did not contain as of the Effective Date any material
misstatement of fact and did not omit to state as of the Effective Date any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not materially misleading in their
presentation of the Acquisition, or of Holding, the Parent Borrower and its
Subsidiaries taken as a whole. It is understood that no representation or
warranty is made concerning the forecasts, estimates, pro forma information,
projections and statements as to anticipated future performance or conditions,
and the assumptions on which they were based, contained in any such information,
reports, financial statements, exhibits or schedules, except that as of the date
such forecasts, estimates, pro forma information, projections and statements
were generated, (i) such forecasts, estimates, pro forma information,
projections and statements were based on the good faith assumptions of the
management of the Parent Borrower and (ii) such assumptions were believed by
such management to be reasonable. Such forecasts, estimates, pro forma
information and statements, and the assumptions on which they were based, may or
may not prove to be correct.
5.20 Delivery of the Transaction Documents. The Administrative Agent
has received for itself and for each Lender a complete photocopy of each of the
Transaction Documents (including all exhibits, schedules and disclosure letters
referred to therein or delivered pursuant thereto, if any) and all amendments
thereto, waivers relating thereto and other side letters or agreements affecting
the terms thereof in any material respect.
5.21 Representations and Warranties Contained in the Transaction
Documents. Each of the Transaction Documents will have been duly executed and
delivered, by each of the Loan Parties which is a party thereto prior to the
Effective Date and, to the knowledge of the Parent Borrower, all other parties
thereto, and is in full force and effect on the Effective Date. As of the
Effective Date, the representations and warranties of the Seller, Holding and
the Parent Borrower and, to the knowledge of the Parent Borrower, any of the
other parties thereto contained in any of the Transaction Documents (after
giving effect to any amendments, supplements, waivers or other modifications of
any of the Transaction Documents prior to the Effective Date in accordance with
this Agreement) are true and
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correct in all material respects except as otherwise disclosed to the
Administrative Agent in writing prior to the Effective Date.
5.22 Labor Matters. There are no strikes pending or, to the
knowledge of the Parent Borrower, reasonably expected to be commenced against
the Parent Borrower or any of its Subsidiaries which, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect. The
hours worked and payments made to employees of the Parent Borrower and each of
its Subsidiaries have not been in violation of any applicable laws, rules or
regulations, except where such violations would not reasonably be expected to
have a Material Adverse Effect. The consummation of the Acquisition will not
give rise to a right of termination or right of renegotiation on the part of any
union under any collective bargaining agreement to which the Parent Borrower or
any of its Subsidiaries (or any predecessor) is a party or by which the Parent
Borrower or any of its Subsidiaries (or any predecessor) is bound.
5.23 Senior Indebtedness. The Loans, L/C Obligations and all other
obligations hereunder and under the other Loan Documents constitute "Designated
Senior Indebtedness" under and as defined in each of the Indentures. The
obligations of each Subsidiary that is a Guarantor under the Guarantee and
Collateral Agreement constitute "Guarantor Senior Indebtedness" of such
Subsidiary Guarantor under and as defined in the Senior Subordinated Note
Indenture.
5.24 Year 2000. Any reprogramming required to permit the proper
functioning (but only to the extent that such proper functioning would otherwise
be impaired by the occurrence of the year 2000), in and following the year 2000,
of the Parent Borrower's and its Subsidiaries' internally developed business
software which is critical to the Parent Borrower and its Subsidiaries taken as
a whole has been completed. Based on the Parent Borrower's estimates as of the
Effective Date, the cost to the Parent Borrower and its Subsidiaries of such
reprogramming, to the extent not reflected or reserved for on the consolidated
balance sheet of the Parent Borrower and its Subsidiaries, would not reasonably
be expected to have a Material Adverse Effect.
SECTION 6. CONDITIONS PRECEDENT
6.1 Conditions to Initial Extension of Credit. This Agreement,
including, without limitation, the agreement of each Lender to make the initial
Extension of Credit requested to be made by it, shall become effective on the
date on which the following conditions precedent shall have been satisfied or
waived:
(a) Loan Documents. The Administrative Agent shall have received the
following Loan Documents (each of which shall be satisfactory in form and
substance to the Administrative Agent), executed and delivered as required
below, with a copy for each applicable Lender: (i) this Agreement,
executed and delivered by a duly authorized officer of the Parent Borrower
and the Foreign Subsidiary Borrowers listed on Schedule IV, (ii) the
Guarantee and Collateral Agreement, executed and delivered by a duly
authorized officer of each of Holding, the Parent Borrower, the Foreign
Subsidiary Borrowers listed on Schedule IV and the Domestic Subsidiaries
of the Parent Borrower listed on Schedule V, (iii) each of the Mortgages,
executed
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and delivered by a duly authorized officer of the Loan Party thereto and
(iv) any Notes requested by the Lenders in accordance with subsections
2.2, 2.7 and 2.8, executed by a duly authorized officer of the applicable
Borrower.
(b) Acquisition Agreement; Consummation of the Acquisition. The
Acquisition Agreement shall not have been amended, supplemented, waived or
otherwise modified in any material respect since the date thereof, except
as may have been consented to in writing by the Administrative Agent and
the Syndication Agent, and the Administrative Agent shall have received a
certificate of a duly authorized officer of Holding dated the Effective
Date, which certificate shall be in form and substance reasonably
satisfactory to the Administrative Agent, to such effect. The Acquisition
shall have been consummated substantially in accordance with the terms and
conditions of the Acquisition Agreement for an aggregate purchase price
not exceeding (i) $400,000,000 in cash, before giving effect to all
adjustments thereof in accordance with the terms and conditions of the
Acquisition Agreement, (ii) 24,500 shares of Holding Preferred Stock
having an initial liquidation preference of $24,500,000, (iii) 174,961
shares of common stock of Holding, representing approximately 20% of
Holding's issued and outstanding common stock (giving effect to vested
options as of September 14, 1999), and (iv) a warrant to purchase 87,480
shares of common stock of Holding at an exercise price of $400 per share,
and the Administrative Agent shall have received from the Parent Borrower
a list, prepared in good faith in a commercially reasonable manner, of the
estimated transaction expenses incurred in connection with the Acquisition
and the financing thereof, which estimate shall not exceed $30,000,000 in
the aggregate. None of the conditions to the respective obligations of
Holding and the Parent Borrower to consummate the Acquisition and the
other transactions contemplated by the Acquisition Agreement shall have
been waived by Holding or the Parent Borrower in any material respect
without the prior consent of the Administrative Agent.
(c) Capitalization and Structure of Holding and its Subsidiaries.
Since the date of the Acquisition Agreement, there shall have been no
material change in the corporate and capital structure of Holding, the
Acquired Business and the Parent Borrower and each of its Subsidiaries
from that contemplated following the Acquisition. All documents,
instruments and other matters relating to the Holding Preferred Stock, the
Holding Loan, the Holding Senior Discount Notes, any Holding Subordinated
Exchange Debentures, the Senior Subordinated Notes and all other material
Indebtedness of Holding and its Subsidiaries remaining outstanding after
the Effective Date shall be reasonably satisfactory to the Lenders. The
Administrative Agent shall have received true and correct copies of the
Senior Subordinated Note Indenture, certified as to authenticity by the
Parent Borrower, and true and correct copies of the Holding Loan
Agreement, the Holding Senior Discount Note Indenture and the form of
Holding Subordinated Exchange Debenture, certified as to authenticity by
Holding. The Administrative Agent shall have received evidence, in form
and substance reasonably satisfactory to it, that CD&R Fund V and other
investors arranged by CD&R and reasonably satisfactory to the
Administrative Agent and the Syndication Agent have committed to purchase
by December 31, 1999 additional shares of common stock of Holding for a
purchase price of $40,000,000.
(d) Senior Subordinated Notes, Holding Senior Discount Notes and
Holding Loan. The Administrative Agent shall have received evidence, in
form and substance reasonably satisfactory
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to it, that (i) the Parent Borrower or its account shall have received
gross cash proceeds of $150,000,000 from the issuance of Senior
Subordinated Notes, (ii) Holding or its account shall have received gross
cash proceeds of $35,000,000 from the issuance of Holding Senior Discount
Notes, (iii) Holding or its account shall have received gross cash
proceeds of $40,000,000 from borrowings under the Holding Loan Agreement
and (iv) Holding shall have used the proceeds from the Holding Loan and
the issuance of Holding Senior Discount Notes to make a $75,000,000
investment in the common equity of the Parent Borrower. All documents
(including, without limitation, the Senior Subordinated Note Indenture,
the Holding Loan Agreement, the Holding Senior Discount Note Indenture and
the Preferred Stock Certificate of Designation), instruments and other
matters relating to the Holding Loan, the issuance of the Senior
Subordinated Notes and the Holding Senior Discount Notes shall be
reasonably satisfactory to the Administrative Agent and the Syndication
Agent.
(e) Termination of Existing Credit Agreement. The Administrative
Agent shall have received evidence satisfactory to it that (i) the
Existing Credit Agreement shall be simultaneously terminated, (ii) all
amounts thereunder shall be simultaneously paid in full, (iii) all letters
of credit (other than any Existing Letter of Credit) and other contingent
obligations in connection with the Existing Credit Agreement shall have
been terminated and (iv) arrangements satisfactory to the Administrative
Agent shall have been made for the termination of Liens and security
interests granted in connection therewith.
(f) Financial Information. The Lenders shall have received copies of
and shall be reasonably satisfied, in form and substance, with (i) the
audited consolidated balance sheets and statements of income and of cash
flows of the Parent Borrower and its consolidated Subsidiaries for the
fiscal years ended and as at December 28, 1996, December 27, 1997 and
December 26, 1998, in each case accompanied by a report of KPMG Peat
Marwick LLP or PricewaterhouseCoopers LLP, as applicable, (ii) the audited
combined balance sheets and statements of income and of cash flows of the
Acquired Business for the fiscal years ended and as at September 30, 1996,
September 30, 1997 and September 30, 1998, in each case accompanied by a
report of Ernst & Young and setting forth at Note 22 an explanation of the
significant differences between U.K. GAAP and U.S. GAAP, (iii) the
unaudited consolidated balance sheets and statements of income and of cash
flows of the Parent Borrower and its consolidated Subsidiaries as at the
end of and for each fiscal month and quarterly period ended after December
26, 1998 and prior to the Effective Date for which such unaudited
financial statements are available, (iv) the unaudited combined balance
sheets and statements of income and of cash flows of the Acquired Business
for the six-month period ended March 31, 1999 and for the nine-month
period ended June 30, 1999 and (v) the Pro Forma Financial Statements,
together with a reconciliation thereof to the balance sheet and statements
of income and of cash flows of the Parent Borrower and its consolidated
Subsidiaries as at the Pro Forma Date.
(g) Business Plan. The Lenders shall have received a reasonably
detailed business plan of the Parent Borrower and its Subsidiaries for
fiscal year 2000 in a form and level of detail reasonably satisfactory to
the Lenders.
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(h) Consents, Licenses and Approvals. The Administrative Agent shall
have received, with a copy for each Lender, a certificate of a Responsible
Officer of the Parent Borrower stating that all consents, authorizations,
notices and filings referred to in Schedule 5.4 are in full force and
effect or have the status described therein, and the Administrative Agent
shall have received evidence thereof reasonably satisfactory to it.
(i) Lien Searches. The Administrative Agent shall have received the
results of a recent search by a Person reasonably satisfactory to the
Administrative Agent and its counsel, of the Uniform Commercial Code,
judgment and tax lien filings which may have been filed with respect to
personal property of Holding, the Parent Borrower, the Acquired Business
and their respective Subsidiaries in any of the jurisdictions set forth in
Schedule 5.14, and the results of such search shall not reveal any Liens
other than Liens permitted by subsection 8.3 or that are otherwise
reasonably satisfactory to the Administrative Agent and its counsel.
(j) Legal Opinions. The Administrative Agent shall have received,
with a copy for each Lender, the following executed legal opinions:
(i) the executed legal opinion of Debevoise & Plimpton,
special counsel to the Parent Borrower and the other Loan Parties,
substantially in the form of Exhibit G-1;
(ii) the executed legal opinions of special local counsel to
the Parent Borrower and the other Loan Parties in the states of
California, Indiana, Michigan and Montana, with respect to
collateral security matters, each substantially in the form of
Exhibit G-2;
(iii) the executed legal opinion of Ralph A. Ford, Esq.,
Senior Vice President and General Counsel of the Parent Borrower,
covering such other matters incident to the transactions
contemplated by this Agreement as the Administrative Agent may
reasonably require; and
(iv) the executed legal opinion of Robert J. Henry, Esq.,
General Counsel of Allied Van Lines Inc., covering such other
matters incident to the transactions contemplated by this Agreement
as the Administrative Agent may reasonably require.
In addition, the Administrative Agent shall have received, with a copy for
each Lender, the legal opinions referred to in Sections 8.7 and 9.3 of the
Acquisition Agreement and each such legal opinion shall state that the
Administrative Agent and the Lenders are entitled to rely thereon as if
such legal opinion were addressed to the Administrative Agent and the
Lenders.
(k) Environmental Assessment. The Administrative Agent shall have
received a copy of the Phase I environmental assessment prepared pursuant
to the Acquisition Agreement, all of the contents of which shall be
reasonably satisfactory to the Lenders, together with a letter from the
firm or firms preparing said assessments or audits permitting the
Administrative Agent and each
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Lender to rely on the environmental assessments, audits or investigations
as if addressed to and prepared for each of them.
(l) Other Material Documentation. The Lenders shall be reasonably
satisfied in all material respects with each of the other documents
relating to the Acquisition and the transactions contemplated hereby and
thereby, including, without limitation, each material Contractual
Obligation and other material financing arrangement to which Holding, the
Parent Borrower or any Subsidiary will be bound after the Effective Date.
(m) Actions to Perfect Liens. The Administrative Agent shall have
received evidence in form and substance reasonably satisfactory to it that
all filings, recordings, registrations and other actions, including,
without limitation, the filing of duly executed financing statements on
form UCC-1 in each jurisdiction set forth on Schedule 5.14, necessary or,
in the reasonable opinion of the Administrative Agent, desirable to
perfect the Liens created by the Security Documents shall have been
completed or shall be ready to be completed promptly following the
Effective Date, and all agreements, statements and other documents
relating thereto shall be in form and substance reasonably satisfactory to
the Administrative Agent.
(n) Pledged Securities; Stock Powers and Endorsements. The
Administrative Agent shall have received the certificates and the
promissory notes, if any, representing the Pledged Stock and Intercompany
Notes under (and as defined in) the Guarantee and Collateral Agreement,
together with an undated stock power for each stock certificate executed
in blank by a duly authorized officer of the pledgor thereof and/or duly
endorsed as required by the Guarantee and Collateral Agreement.
(o) Surveys. The Administrative Agent shall have received, and the
Title Insurance Company shall have received, maps or plats of an as-built
survey of the sites of the owned real property covered by the Mortgages
certified to the Administrative Agent and the Title Insurance Company in a
manner reasonably satisfactory to them, dated a date reasonably
satisfactory to the Administrative Agent and the Title Insurance Company
by an independent professional licensed land surveyor reasonably
satisfactory to the Administrative Agent and the Title Insurance Company,
which maps or plats and the surveys on which they are based shall be made
in accordance with the Minimum Standard Detail Requirements for Land Title
Surveys jointly established and adopted by the American Land Title
Association and the American Congress on Surveying and Mapping in 1992,
and, without limiting the generality of the foregoing, there shall be
surveyed and shown on such maps, plats or surveys the following: (i) the
locations on such sites of all the buildings, structures and other
improvements and the established building setback lines; (ii) the lines of
streets abutting the sites and width thereof; (iii) all access and other
easements appurtenant to the sites necessary to use the sites; (iv) all
roadways, paths, driveways, easements, encroachments and overhanging
projections and similar encumbrances affecting the sites, whether
recorded, apparent from a physical inspection of the sites or otherwise
known to the surveyor; (v) any encroachments on any adjoining property by
the building structures and improvements on the sites; and (vi) if the
site is described as being on a filed map, a legend relating the survey to
said map.
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(p) Title Insurance Policy. The Administrative Agent shall have
received in respect of each parcel of owned real property covered by a
Mortgage a mortgagee's title policy (or policies) or marked up
unconditional binder for such insurance dated the date of the recording of
such Mortgage. Each such policy shall (i) be in an amount reasonably
satisfactory to the Administrative Agent; (ii) insure that the Mortgage
insured thereby creates a valid first Lien on such parcel free and clear
of all defects and encumbrances, except those permitted by subsection 8.3
and such as may be approved by the Administrative Agent; (iii) name the
Administrative Agent for the benefit of the Lenders as the insured
thereunder; (iv) be in the form of an ALTA Loan Policy; (v) contain such
endorsements and affirmative coverage as the Administrative Agent may
reasonably request and (vi) be issued by title companies reasonably
satisfactory to the Administrative Agent (including any such title
companies acting as co-insurers or reinsurers, at the option of the
Administrative Agent). The Administrative Agent shall have received
evidence reasonably satisfactory to it that all premiums in respect of
each such policy, and all charges for mortgage recording tax, if any, have
been paid. The Administrative Agent shall have also received a copy of all
recorded documents referred to, or listed as exceptions to title in, the
title policy or policies referred to in this subsection and a copy
certified by such parties as the Administrative Agent may deem reasonably
appropriate, of all other documents affecting the property covered by each
Mortgage as shall have been reasonably requested by the Administrative
Agent.
(q) Fees. The Parent Borrower shall have paid to the Administrative
Agent the fees to be received on the Effective Date referred to in
subsection 4.5.
(r) Borrowing Certificate. The Administrative Agent shall have
received, with a copy for each Lender, a certificate of the Parent
Borrower, dated the Effective Date, substantially in the form of Exhibit
J, with appropriate insertions and attachments, reasonably satisfactory in
form and substance to the Administrative Agent, executed by a Responsible
Officer and the Secretary or any Assistant Secretary of the Parent
Borrower.
(s) Corporate Proceedings of the Loan Parties. The Administrative
Agent shall have received, with a copy for each Lender, a copy of the
resolutions, in form and substance reasonably satisfactory to the
Administrative Agent, of the Board of Directors of each Loan Party
authorizing, as applicable, (i) the execution, delivery and performance of
this Agreement, any Notes and the other Loan Documents to which it is or
will be a party, (ii) the Extensions of Credit contemplated hereunder and
(iii) the granting by it of the Liens to be created pursuant to the
Security Documents to which it will be a party, certified by the Secretary
or an Assistant Secretary of such Person as of the Effective Date, which
certificate shall be in form and substance reasonably satisfactory to the
Administrative Agent and shall state that the resolutions thereby
certified have not been amended, modified (except as any later such
resolution may modify any earlier such resolution), revoked or rescinded
and are in full force and effect.
(t) Incumbency Certificates of the Loan Parties. The Administrative
Agent shall have received, with a copy for each Lender, a certificate of
each Loan Party, dated the Effective Date, as to the incumbency and
signature of the officers of such Person executing any Loan
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Document, reasonably satisfactory in form and substance to the
Administrative Agent, executed by a Responsible Officer and the Secretary
or any Assistant Secretary of such Person.
(u) Corporate Documents. The Administrative Agent shall have
received, with a copy for each Lender, copies of the certificate of
incorporation and by-laws of each Loan Party, certified as of the
Effective Date as complete and correct copies thereof by the Secretary or
an Assistant Secretary of such Loan Party.
(v) Insurance. The Administrative Agent shall have received evidence
in form and substance reasonably satisfactory to it (i) that the
requirements of Section 5.2.2 of the Guarantee and Collateral Agreement
and Section 5 of each Mortgage shall have been satisfied, together with
certificates of insurance and other evidence of such insurance, if any,
naming the Administrative Agent as an additional insured and/or loss payee
and (ii) relating to the insurance program operated by the Parent
Borrower.
(w) No Material Change. Since March 31, 1999, there shall not have
occurred a Material Adverse Change.
(x) No Material Litigation. No litigation, investigation, injunction
or restraining order shall be pending, entered or threatened that would
reasonably be expected to have a Material Adverse Effect or a material
adverse effect on the Acquired Business or the transactions contemplated
hereby.
(y) Acknowledgment and Consent. The Administrative Agent shall have
received, with a copy for each Lender, an acknowledgment and consent,
substantially in the form attached to the Guarantee and Collateral
Agreement, executed and delivered by a duly authorized officer of each of
NATIC and TransGuard.
The making of the initial Extensions of Credit by the Lenders hereunder shall
conclusively be deemed to constitute an acknowledgment by the Administrative
Agent and each Lender that each of the conditions precedent set forth in this
subsection 6.1 shall have been satisfied in accordance with its respective terms
or shall have been irrevocably waived by such Person.
6.2 Conditions to Each Other Extension of Credit. The agreement of
each Lender to make any Extension of Credit requested to be made by it on any
date (including, without limitation, the initial Extension of Credit and each
Swing Line Loan) is subject to the satisfaction or waiver of the following
conditions precedent:
(a) Representations and Warranties. Each of the representations and
warranties made by any Loan Party pursuant to this Agreement or any other
Loan Document (or in any amendment, modification or supplement hereto or
thereto) to which it is a party, and each of the representations and
warranties contained in any certificate furnished at any time by or on
behalf of any Loan Party pursuant to this Agreement or any other Loan
Document, shall, except to the extent that they relate to a particular
date, be true and correct in all material respects on and as of such date
as if made on and as of such date.
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(b) No Default. No Default or Event of Default shall have occurred
and be continuing on such date or after giving effect to the Extensions of
Credit requested to be made on such date.
(c) Letter of Credit Application. With respect to the issuance of
any Letter of Credit, the Issuing Lender shall have received an
Application completed to its satisfaction, and such other certificates,
documents and other papers and information as the Issuing Lender may
reasonably request.
Each borrowing by and Letter of Credit issued on behalf of any Borrower
hereunder shall constitute a representation and warranty by the Parent Borrower
as of the date of such borrowing or such issuance that the conditions contained
in this subsection 6.2 have been satisfied.
6.3 Additional Conditions Applicable to Foreign Subsidiary
Borrowers. The agreement of each Lender to make any Extension of Credit
requested to be made by it to any Foreign Subsidiary Borrower on any date
(including, without limitation, the initial Extension of Credit and each Swing
Line Loan, if requested to be made to any Foreign Subsidiary Borrower) is
subject to satisfaction or waiver of, in addition to the conditions precedent
set forth in subsections 6.1 (in the case of the initial Extension of Credit)
and 6.2, the following conditions precedent: (a) in the case of the making of
any Extension of Credit to any Foreign Subsidiary Borrower for the first time,
the delivery to the Administrative Agent, with a copy for each Lender, of the
executed legal opinion of counsel to such Foreign Subsidiary Borrower, as to the
matters set forth in Exhibit G-3 and otherwise in form and substance reasonably
satisfactory to the Administrative Agent, (b) the delivery to the Administrative
Agent of a certificate of the Parent Borrower, executed and delivered by a
Responsible Officer of the Parent Borrower, stating (i) that such Foreign
Subsidiary Borrower is a "Restricted Subsidiary" for all purposes of each of the
Indentures and (ii) that all of the Indebtedness in respect of such Extension of
Credit to be made to such Foreign Subsidiary Borrower will constitute each of
"Bank Indebtedness" and "Senior Indebtedness" for all purposes of each of the
Indentures and that none of such Indebtedness is incurred in violation of any of
the Indentures (which certificate shall include any calculations required to
support such statements) and (c) the truthfulness and correctness in all
material respects on and as of such date of the following additional
representations and warranties:
(i) Pari Passu. The obligations of such Foreign Subsidiary
Borrower under this Agreement and any Note, when executed and delivered by
such Foreign Subsidiary Borrower, will rank at least pari passu with all
other secured Indebtedness of such Foreign Subsidiary Borrower.
(ii) No Immunities, etc. Such Foreign Subsidiary Borrower is
subject to civil and commercial law with respect to its obligations under
this Agreement and any Note, and the execution, delivery and performance
by such Foreign Subsidiary Borrower of this Agreement constitute and will
constitute private and commercial acts and not public or governmental
acts. Neither such Foreign Subsidiary Borrower nor any of its property,
whether or not held for its own account, has any immunity (sovereign or
other similar immunity) from any suit or proceeding, from jurisdiction of
any court or from set-off or any legal process (whether service
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or notice, attachment prior to judgment, attachment in aid of execution of
judgment, execution of judgment or other similar immunity) under the laws
of the jurisdiction in which such Foreign Subsidiary Borrower is organized
and existing in respect of its obligations under this Agreement or any
Note. Such Foreign Subsidiary Borrower has, pursuant to subsection 11.12,
waived every immunity (sovereign or otherwise) to which it or any of its
properties would otherwise be entitled from any legal action, suit or
proceeding, from jurisdiction of any court or from set-off or any legal
process (whether service or notice, attachment prior to judgment,
attachment in aid of execution of judgment, execution of judgment or
otherwise) under the laws of the jurisdiction in which such Foreign
Subsidiary Borrower is organized and existing in respect of its
obligations under this Agreement and any Note. The waiver by such Foreign
Subsidiary Borrower described in the immediately preceding sentence is the
legal, valid and binding obligation of such Foreign Subsidiary Borrower.
(iii) No Recordation Necessary. This Agreement and each Note,
if any, is in proper legal form under the laws of the jurisdiction in
which such Foreign Subsidiary Borrower is organized and existing for the
enforcement hereof or thereof against such Foreign Subsidiary Borrower
under the laws of such jurisdiction, and to ensure the legality, validity,
enforceability, priority or admissibility in evidence of this Agreement
and any such Note. It is not necessary to ensure the legality, validity,
enforceability, priority or admissibility in evidence of this Agreement
and any such Note that this Agreement, any Note or any other document be
filed, registered or recorded with, or executed or notarized before, any
court or other authority in the jurisdiction in which such Foreign
Subsidiary Borrower is organized and existing or that any registration
charge or stamp or similar tax be paid on or in respect of this Agreement,
any Note or any other document, except for any such filing, registration
or recording, or execution or notarization, as has been made or is not
required to be made until this Agreement, any Note or any other document
is sought to be enforced and for any charge or tax as has been timely
paid.
(iv) Exchange Controls. The execution, delivery and
performance by such Foreign Subsidiary Borrower of this Agreement, any
Note or the other Loan Documents is, under applicable foreign exchange
control regulations of the jurisdiction in which such Foreign Subsidiary
Borrower is organized and existing, not subject to any notification or
authorization except such as have been made or obtained or cannot be made
or obtained until a later date.
Each borrowing by and Letter of Credit issued for the account of any
Foreign Subsidiary Borrower hereunder shall constitute a representation and
warranty by each of the Parent Borrower and such Foreign Subsidiary Borrower as
of the date of such borrowings or such issuance that the conditions contained in
this subsection 6.3 have been satisfied.
SECTION 7. AFFIRMATIVE COVENANTS
The Parent Borrower hereby agrees that, from and after the Effective
Date and so long as the Revolving Credit Commitments remain in effect, and
thereafter until payment in full of the Loans, all Reimbursement Obligations and
any other amount then due and owing to any Lender or the Administrative Agent
hereunder and under any Note and termination or expiration of all Letters of
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Credit, the Parent Borrower shall and (except in the case of delivery of
financial information, reports and notices) shall cause each of its Subsidiaries
to:
7.1 Financial Statements. Furnish to each Lender:
(a) as soon as available, but in any event not later than 90 days
after the end of each fiscal year of Holding, a copy of the audited
consolidated balance sheet of Holding and its consolidated Subsidiaries as
at the end of such year and the related audited consolidated statements of
income and of cash flows for such year, setting forth in each case in
comparative form the figures for and as of the end of the previous year,
reported on without a "going concern" or like qualification or exception,
or qualification arising out of the scope of the audit, by
PricewaterhouseCoopers LLP or other independent certified public
accountants of nationally recognized standing reasonably satisfactory to
the Administrative Agent;
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal
year of Holding, the unaudited consolidated balance sheet of Holding and
its consolidated Subsidiaries as at the end of such quarter and the
related unaudited consolidated statements of income and of cash flows of
Holding and its consolidated Subsidiaries for such quarter and the portion
of the fiscal year through the end of such quarter, setting forth in each
case in comparative form the budgeted figures (as adjusted consistent with
past practice) for the relevant period and the figures for the
corresponding period of the previous fiscal year, certified by a
Responsible Officer of Holding as being fairly stated in all material
respects (subject to normal year-end audit and other adjustments);
(c) as soon as available, but in any event not later than 90 days
after the end of each fiscal year of the Parent Borrower, a copy of the
audited consolidated balance sheet of the Parent Borrower and its
consolidated Subsidiaries as at the end of such year and the related
audited consolidated statements of income and of cash flows for such year,
setting forth in each case in comparative form the figures for and as of
the end of the previous year, reported on without a "going concern" or
like qualification or exception, or qualification arising out of the scope
of the audit, by PricewaterhouseCoopers LLP or other independent certified
public accountants of nationally recognized standing reasonably
satisfactory to the Administrative Agent;
(d) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal
year of the Parent Borrower, the unaudited consolidated balance sheet of
the Parent Borrower and its consolidated Subsidiaries as at the end of
such quarter and the related unaudited consolidated statements of income
and of cash flows of the Parent Borrower and its consolidated Subsidiaries
for such quarter and the portion of the fiscal year through the end of
such quarter, setting forth in each case in comparative form the budgeted
figures (as adjusted consistent with past practice) for the relevant
period and the figures for the corresponding period of the previous fiscal
year, certified by a Responsible Officer of the Parent Borrower as being
fairly stated in all material respects (subject to normal year-end audit
and other adjustments); and
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(e) as soon as available, but in any event not later than 30 days
after the end of each fiscal month of each fiscal year of the Parent
Borrower (or 45 days in the case of any such month ending on the last day
of a fiscal quarter), a copy of the unaudited consolidated balance sheet
of the Parent Borrower and its consolidated Subsidiaries as of the end of
such month and the related unaudited consolidated statements of income and
of cash flows for such month and the portion of the fiscal year through
the end of such month, setting forth in each case, in comparative form the
figures for the corresponding fiscal month of the previous year, certified
by a Responsible Officer of the Parent Borrower as being fairly stated in
all material respects (subject to normal quarter-end or year-end audit and
other adjustments);
all such financial statements delivered pursuant to subsection 7.1(a), (b), (c)
or (d) to be (and, in the case of financial statements delivered pursuant to
subsection 7.1(b) or (d) shall be certified by a Responsible Officer of Holding
or the Parent Borrower, as applicable, as being) complete and correct in all
material respects in conformity with GAAP and to be (and, in the case of
financial statements delivered pursuant to subsection 7.1(b) or (d) shall be
certified by a Responsible Officer of Holding or the Parent Borrower, as
applicable, as being) prepared in reasonable detail in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods that began on or after the Effective Date (except as approved by such
accountants or officer, as the case may be, and disclosed therein, and except,
in the case of the financial statements delivered pursuant to subsection 7.1(b)
or (d), for the absence of certain notes).
7.2 Certificates; Other Information. Furnish to each Lender:
(a) concurrently with the delivery of the financial statements
referred to in subsection 7.1(a) and (c), a certificate of the independent
certified public accountants reporting on such financial statements
stating that in making the audit necessary therefor no knowledge was
obtained of any Default or Event of Default insofar as the same relates to
any financial accounting matters covered by their audit, except as
specified in such certificate;
(b) concurrently with the delivery of the financial statements
referred to in subsections 7.1(a), (b), (c) and (d), a certificate signed
by a Responsible Officer of Holding and by a Responsible Officer of the
Parent Borrower, (i) stating that, to the best of each such Responsible
Officer's knowledge, each of Holding or the Parent Borrower, as the case
may be, and its Subsidiaries during such period has observed or performed
all of its covenants and other agreements, and satisfied every condition,
contained in this Agreement, any Notes and the other Loan Documents to
which it is a party to be observed, performed or satisfied by it, and that
such Responsible Officer has obtained no knowledge of any Default or Event
of Default, except, in each case, as specified in such certificate, and
(ii) setting forth the calculations required to determine (A) compliance
with all covenants set forth in subsection 8.1 (in the case of a
certificate furnished with the financial statements referred to in
subsections 7.1(c) and (d)) and (B) compliance with the covenant set forth
in subsection 8.8 (in the case of a certificate furnished with the
financial statements referred to in subsection 7.1(c));
(c) as soon as available, but in any event not later than 90 days
after the beginning of each fiscal year of Holding, a copy of the
projections by Holding of the operating budget and
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cash flow budget of Holding and its Subsidiaries for such fiscal year,
such projections to be accompanied by a certificate of a Responsible
Officer of Holding to the effect that such Responsible Officer believes
such projections to have been prepared on the basis of reasonable
assumptions;
(d) within five days after the same are sent, copies of all
financial statements and reports which Holding or the Parent Borrower
sends to its public securityholders, if any, and within five days after
the same are filed, copies of all financial statements and periodic
reports which Holding or the Parent Borrower may file with the Securities
and Exchange Commission or any successor or analogous Governmental
Authority;
(e) within two days after the same are filed, copies of all
registration statements and any amendments and exhibits thereto, which
Holding or the Parent Borrower may file with the Securities and Exchange
Commission or any successor or analogous Governmental Authority, and such
other documents or instruments as may be reasonably requested by the
Administrative Agent in connection therewith; and
(f) promptly, such additional financial and other information as any
Lender may from time to time reasonably request.
7.3 Payment of Obligations. Pay, discharge or otherwise satisfy at
or before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature, except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
diligently conducted and reserves in conformity with GAAP with respect thereto
have been provided on the books of Holding or its Subsidiaries, as the case may
be.
7.4 Conduct of Business and Maintenance of Existence. Continue to
engage in business of the same general type as conducted by Holding and its
Subsidiaries on the Effective Date, taken as a whole, and preserve, renew and
keep in full force and effect its corporate existence and take all reasonable
action to maintain all rights, privileges and franchises necessary or desirable
in the normal conduct of the business of Holding, the Parent Borrower and its
Subsidiaries, taken as a whole, except as otherwise expressly permitted pursuant
to subsection 8.5, provided that Holding, the Parent Borrower and its
Subsidiaries shall not be required to maintain any such rights, privileges or
franchises, if the failure to do so would not reasonably be expected to have a
Material Adverse Effect; and comply with all Contractual Obligations and
Requirements of Law except to the extent that failure to comply therewith, in
the aggregate, would not reasonably be expected to have a Material Adverse
Effect.
7.5 Maintenance of Property; Insurance. Keep all property useful and
necessary in the business of Holding, the Parent Borrower and its Subsidiaries,
taken as a whole, in good working order and condition; maintain with financially
sound and reputable insurance companies insurance on all property material to
the business of Holding, the Parent Borrower and its Subsidiaries, taken as a
whole, in at least such amounts and against at least such risks (but including
in any event public liability, product liability and business interruption) as
are usually insured against in the same general area by companies engaged in the
same or a similar business; and furnish to the Administrative Agent, upon
written request, information in reasonable detail as to the insurance carried,
together with certificates of
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insurance and other evidence of such insurance, if any, naming the
Administrative Agent as an additional insured and/or loss payee.
7.6 Inspection of Property; Books and Records; Discussions. (a) Keep
proper books of records and account in which full, complete and correct entries
in conformity with GAAP and all material Requirements of Law shall be made of
all dealings and transactions in relation to its business and activities; and
permit representatives of any Lender to visit and inspect any of its properties
and examine and, to the extent reasonable, make abstracts from any of its books
and records and to discuss the business, operations, properties and financial
and other condition of Holding, the Parent Borrower and its Subsidiaries with
officers and employees of Holding, the Parent Borrower and its Subsidiaries and
with its independent certified public accountants, in each case at any
reasonable time, upon reasonable notice, and as often as may reasonably be
desired.
(b) If a Default or Event of Default shall have occurred and be
continuing, the Parent Borrower shall reimburse the Administrative Agent for any
reasonable fees and expenses of third parties incurred in connection with any
appraisal of Holding's, the Parent Borrower's or any of its Subsidiaries' real
property reasonably requested in writing by the Required Lenders.
7.7 Notices. Promptly give notice to the Administrative Agent and
each Lender of:
(a) as soon as possible after a Responsible Officer of the Parent
Borrower knows or reasonably should know thereof, the occurrence of any
Default or Event of Default;
(b) as soon as possible after a Responsible Officer of the Parent
Borrower knows or reasonably should know thereof, any (i) default or event
of default under any Contractual Obligation of Holding, the Parent
Borrower or any of its Subsidiaries, other than as previously disclosed in
writing to the Lenders, or (ii) litigation, investigation or proceeding
which may exist at any time between Holding, the Parent Borrower or any of
its Subsidiaries and any Governmental Authority, which in either case, if
not cured or if adversely determined, as the case may be, would reasonably
be expected to have a Material Adverse Effect;
(c) as soon as possible after a Responsible Officer of Holding or
the Parent Borrower knows or reasonably should know thereof, the
occurrence of (i) any default or event of default under the Senior
Subordinated Notes, the Holding Senior Discount Notes, any Holding
Subordinated Exchange Debentures or any Indenture or (ii) any breach of
any provision of the Preferred Stock Certificate of Designation;
(d) as soon as possible after a Responsible Officer of the Parent
Borrower knows or reasonably should know thereof, any litigation or
proceeding affecting Holding, the Parent Borrower or any of its
Subsidiaries in which the amount involved (not covered by insurance or
indemnified by the Seller pursuant to the Acquisition Agreement) is
$2,500,000 or more or in which injunctive or similar relief is sought that
would reasonably be expected to have a Material Adverse Effect;
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(e) the following events, as soon as possible and in any event
within 30 days after a Responsible Officer of the Parent Borrower knows or
reasonably should know thereof: (i) the occurrence or expected occurrence
of any Reportable Event with respect to any Single Employer Plan (other
than a Reportable Event described in Section 4043(c)(9) of ERISA), a
failure to make any required contribution to a Single Employer Plan or
Multiemployer Plan, the creation of any Lien on the property of Holding,
the Parent Borrower or any of its Subsidiaries in favor of the PBGC or a
Plan or any withdrawal from, or the termination, Reorganization or
Insolvency of, any Multiemployer Plan if, as a result thereof, Holding,
the Parent Borrower, or any of its Subsidiaries would reasonably be
expected to incur any material liability; (ii) the existence of an
Underfunding under a Single Employer Plan that exceeds the lesser of (x)
10% of the value of the assets of such Single Employer Plan or (y)
$2,500,000, in each case, determined as of the most recent annual
valuation date of such Single Employer Plan on the basis of the actuarial
assumptions used to determine the funding requirements of such Single
Employer Plan as of such date; (iii) the institution of proceedings or the
taking of any other formal action by the PBGC or Holding, the Parent
Borrower or any Commonly Controlled Entity or any Multiemployer Plan with
respect to the withdrawal from, or the termination, Reorganization or
Insolvency of, any Single Employer Plan or Multiemployer Plan if, as a
result thereof, Holding, the Parent Borrower or any of its Subsidiaries
would reasonably be expected to incur any material liability; or (iv) the
occurrence or expected occurrence of any event or condition under which
Holding, the Parent Borrower or any Commonly Controlled Entity has
incurred or could incur any liability in respect of a Former Plan;
(f) as soon as possible after a Responsible Officer of the Parent
Borrower knows or reasonably should know thereof, any material adverse
change in the business, operations, property, condition (financial or
otherwise) or prospects of Holding and its Subsidiaries taken as a whole;
(g) as soon as possible after a Responsible Officer of the Parent
Borrower knows or reasonably should know thereof, and except in each case
as would not reasonably be expected to result in a Material Adverse
Effect, (i) any release or discharge by the Parent Borrower or any of its
Subsidiaries of any Materials of Environmental Concern required to be
reported under applicable Environmental Laws to any Governmental
Authority; (ii) any condition, circumstance, occurrence or event that
would result in liability pursuant to applicable Environmental Laws or
would result in the imposition of any lien or other restriction on the
title, ownership or transferability of any Property; (iii) any proposed
action to be taken by the Parent Borrower or any of its Subsidiaries that
would reasonably be expected to subject the Parent Borrower or any of its
Subsidiaries to any material additional or different requirements or
liabilities, to the knowledge of the Parent Borrower or any of its
Subsidiaries, under any applicable Environmental Law; (iv) any
Governmental Authority has notified the Parent Borrower or any of its
Subsidiaries that any such Person is a potentially responsible party under
the Comprehensive Environmental Response, Compensation and Liability Act
or any comparable law for the cleanup of Materials of Environmental
Concern at any location, whether or not owned, leased or operated by the
Parent Borrower or any of its Subsidiaries; (v) any Governmental Authority
has notified the Parent Borrower or any of its Subsidiaries that it will
revoke any permit pursuant to any Environmental Law held by the Parent
Borrower or any of its Subsidiaries, or deny or refuse to renew any such
permit sought by the Parent Borrower or any
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of its Subsidiaries; or (vi) any Governmental Authority has notified the
Parent Borrower or any of its Subsidiaries that any property owned,
leased, or operated by the Parent Borrower or any of its Subsidiaries is
being listed on, or proposed for listing on, the National Priorities List
(NPL) or the Comprehensive Environmental Response, Compensation and
Liability Information System (CERCLIS) maintained by the U.S.
Environmental Protection Agency, or on any similar list maintained by any
Governmental Authority; and
(h) within three Business Days of the issuance thereof, notice of
any issuance of a letter of credit permitted by subsection 8.2(k).
Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer of the Parent Borrower (and, if applicable, the relevant
Commonly Controlled Entity or Subsidiary) setting forth details of the
occurrence referred to therein and stating what action the Parent Borrower (or,
if applicable, the relevant Commonly Controlled Entity or Subsidiary) proposes
to take with respect thereto.
7.8 Environmental Laws. (a) Comply substantially with all
Environmental Laws applicable to it, and obtain, comply substantially with and
maintain any and all licenses, approvals, notifications, registrations or
permits required by applicable Environmental Laws; and (ii) take all reasonable
efforts to ensure that all tenants, subtenants, contractors, subcontractors and
invitees comply substantially with all Environmental Laws, and obtain, comply
substantially with and maintain any and all licenses, approvals, notifications,
registrations or permits required by Environmental Laws applicable to any of
them insofar as any failure to so comply, obtain or maintain reasonably would be
expected to adversely affect the Parent Borrower or any of its Subsidiaries. For
purposes of this subsection 7.8(a), noncompliance shall be deemed not to
constitute a breach of this covenant provided that, upon learning of any actual
or suspected noncompliance, the Parent Borrower shall in a timely fashion
undertake or cause to be undertaken reasonable efforts to achieve substantial
compliance, and provided, further that, in any case, such noncompliance, and any
other such noncompliance with any Environmental Law, individually or in the
aggregate, would not reasonably be expected to result in a Material Adverse
Effect.
(b) Promptly upon the Administrative Agent's request if the Parent
Borrower shall have failed to pay any principal of any Loan or any Reimbursement
Obligation when due in accordance with the terms hereof or shall have failed to
pay any interest on any Loan within five days after any such interest becomes
due in accordance with the terms hereof, permit an environmental consultant,
whom the Administrative Agent designates and which consultant is reasonably
acceptable to the Parent Borrower, to perform an environmental assessment
(including, without limitation: reviewing documents; interviewing knowledgeable
persons; and sampling and analyzing soil, air, surface rate, ground water,
and/or other media) in or about any Property subject to a Mortgage. Such
environmental assessment shall be in form, scope and substance reasonably
satisfactory to the Administrative Agent. The Parent Borrower or its
Subsidiaries shall cooperate fully in the conduct of such environmental
assessment, and shall pay the costs of such environmental assessment promptly
upon written demand by the Administrative Agent. Pursuant to this subsection
7.8(b) the Administrative Agent shall have the right, but shall not have any
duty, to request and/or obtain such environmental assessment.
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(c) Maintain, update as appropriate, and implement in all material
respects an ongoing program to ensure that all the properties and operations of
the Parent Borrower and its Subsidiaries are regularly and reasonably reviewed
by competent professionals (which may be employees of the Parent Borrower and
its Subsidiaries) to identify and promote compliance with and to reasonably and
prudently manage any liabilities or potential liabilities under any
Environmental Law that could reasonably be expected to have a Material Adverse
Effect, including, without limitation, compliance and liabilities relating to:
discharges to air and water; acquisition, transportation, storage and use of
hazardous materials; waste disposal; repair, maintenance and improvement of
properties; employee health and safety; species protection; and recordkeeping.
7.9 After-Acquired Real Property and Fixtures. (a) With respect to
any owned real property or fixtures having a value in excess of $500,000 in
which the Parent Borrower or any of its Domestic Subsidiaries or any Foreign
Subsidiary Borrower acquires ownership rights at any time after the Effective
Date, promptly grant to the Administrative Agent, for the ratable benefit of the
Lenders, a Lien of record on all such owned real property and fixtures, upon
terms reasonably satisfactory in form and substance to the Administrative Agent
and in accordance with any applicable requirements of any Governmental Authority
(including, without limitation, any required appraisals of such property under
FIRREA); provided that nothing in this subsection 7.9 shall defer or impair the
attachment or perfection of any security interest in any Collateral covered by
any of the Security Documents which would attach or be perfected pursuant to the
terms thereof without action by the Parent Borrower, any Subsidiary or any other
Person; provided that any such mortgage by a Foreign Subsidiary Borrower shall
not secure any other Borrower's obligations. In connection with any such grant
to the Administrative Agent, for the benefit of the Lenders, of a first priority
Lien of record on any such real property in accordance with this subsection, the
Parent Borrower or such Subsidiary shall deliver or cause to be delivered to the
Administrative Agent any surveys, title insurance policies, environmental
reports and other documents in connection with such grant of such Lien obtained
by it in connection with the acquisition of such ownership rights in such real
property or as the Administrative Agent shall reasonably request (in light of
the value of such real property and the cost and availability of such surveys,
title insurance policies, environmental reports and other documents and whether
the delivery of such surveys, title insurance policies, environmental reports
and other documents would be customary in connection with such grant of such
Lien in similar circumstances).
(b) At its own expense, execute, acknowledge and deliver, or cause
the execution, acknowledgment and delivery of, and thereafter register, file or
record in an appropriate governmental office, any document or instrument
reasonably deemed by the Administrative Agent to be necessary or desirable for
the creation and perfection of the foregoing Liens or any other Liens created
pursuant to the Security Documents.
(c) At its own expense, request, and use reasonable efforts to
obtain, (i) a consent, substantially in the form of Exhibit F or such other form
as may be reasonably satisfactory to the Administrative Agent, from the landlord
of each of the existing facilities in which Inventory of any Loan Party is
located and for which annual lease payments exceed $100,000, as of the Effective
Date, in which such landlord acknowledges the Administrative Agent's security
interest in the Inventory pledged by each Loan Party to the Administrative Agent
for the benefit of the Lenders, copies of which consent, if obtained, shall be
delivered to the Administrative Agent (A) within 30 days after the Effective
Date, if
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such consent is from a landlord entitled to receive at least $100,000 in annual
lease payments with respect to a facility and (B) to the extent not previously
delivered, as promptly as reasonably practicable following the Effective Date,
and (ii) prior to entering into a lease of a facility in which Inventory will be
located on or after the Effective Date, a consent, substantially in the form of
Exhibit F or such other form as may be reasonably satisfactory to the
Administrative Agent, from each landlord of any such facility, in which such
landlord acknowledges the Administrative Agent's first priority security
interest in the Inventory pledged by each Loan Party to the Administrative Agent
for the benefit of the Lenders.
(d) Notwithstanding anything to contrary in this Agreement, nothing
in this subsection 7.9 shall require that any Foreign Subsidiary Borrower grant
a Lien with respect to any owned real property or fixtures in which such
Subsidiary acquires ownership rights to the extent that the Administrative
Agent, in its reasonable judgment, determines that the granting of such a Lien
is impracticable.
7.10 Acquired Subsidiaries; Further Security and Guarantees. (a) In
the event that the Parent Borrower or any of its Subsidiaries acquires any
Material Subsidiary from any third party as permitted by the other provisions of
this Agreement, (i) such new Subsidiary (in the case of a new Domestic
Subsidiary or a Foreign Subsidiary Borrower) shall, to the extent permitted by
law, execute and deliver to the Administrative Agent the Guarantee and
Collateral Agreement and appropriate Mortgages and other security documents and
take any necessary steps to perfect the security interest to be created thereby
and (ii) the relevant parent corporation (if such parent corporation is the
Parent Borrower or a Domestic Subsidiary) shall execute and deliver to the
Administrative Agent a stock pledge agreement (or, if the parent corporation is
a party to the Guarantee and Collateral Agreement, pledge the Capital Stock of
such Material Subsidiary owned by such parent corporation pursuant to such
agreement) and shall take any necessary steps to perfect the security interest
to be created thereby (which security interest shall not apply to more than 65%
of such parent corporation's ownership interest in any Foreign Subsidiary).
Notwithstanding anything to contrary in this Agreement, nothing in this
subsection 7.10(a) shall require that any Foreign Subsidiary Borrower pledge the
stock of any Foreign Subsidiary acquired by it to the extent that the
Administrative Agent, in its reasonable judgment, determines that the granting
of such a Lien is impracticable.
(b) Within 30 days after the due date for delivery of financial
statements pursuant to subsection 7.1(a), (b), (c) or (d), (i) the Parent
Borrower shall, to the extent permitted by law, cause any Domestic Subsidiary
(other than MSS (unless it is a Wholly Owned Subsidiary)) that qualifies as a
Material Subsidiary (based on its total assets as of the end of, or its total
revenues for, the most recently completed period of four consecutive fiscal
quarters of Holding), but which is not a party to the Guarantee and Collateral
Agreement, to execute and deliver to the Administrative Agent the Guarantee and
Collateral Agreement and appropriate Mortgages and other security documents and
take any necessary steps to perfect the security interest to be created thereby
and (ii) the relevant parent corporation (if such parent corporation is the
Parent Borrower or a Domestic Subsidiary) shall execute and deliver to the
Administrative Agent a stock pledge agreement (or, if the parent corporation is
a party to the Guarantee and Collateral Agreement, pledge the Capital Stock of
such Material Subsidiary owned by such parent corporation pursuant to such
agreement) and shall take any necessary steps to perfect the security interest
to be created thereby (which security interest shall not apply to more than 65%
of such parent corporation's ownership interest in any Foreign Subsidiary).
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7.11 Interest Rate Protection Agreement. In the case of the Parent
Borrower, no later than 90 days after the Effective Date, enter into an Interest
Rate Protection Agreement to provide that an amount at least equal to 50% of the
aggregate principal amount of the Loans and Senior Subordinated Notes is subject
to interest rate protection, which Interest Rate Protection Agreement shall be
in form and substance, and for a term, reasonably satisfactory to the
Administrative Agent and the Syndication Agent.
7.12 Capital Contributions from Holding. In the case of the Parent
Borrower, immediately upon receipt of any capital contribution from Holding made
with the cash proceeds of any Asset Sale or any incurrence of Indebtedness for
borrowed money (other than Indebtedness permitted pursuant to Section 5.4.2(ii)
of the Guarantee and Collateral Agreement), prepay the Loans in accordance with
subsection 4.4(c).
7.13 Maintenance of New York Process Agent. In the case of any
Foreign Subsidiary Borrower, maintain in New York, New York or at such other
location in the United States of America as may be reasonably satisfactory to
the Administrative Agent a Person acting as agent to receive on its behalf and
on behalf of its property service of process and capable of discharging the
functions of the New York Process Agent set forth in subsection 11.12(b).
7.14 Updated Survey for California Mortgaged Property. In the case
of the Parent Borrower, furnish to the Administrative Agent, within 60 days
after the Effective Date, an update of the survey of the owned real property
covered by a Mortgage and located in California that was previously delivered to
the Administrative Agent pursuant to subsection 6.1(o).
SECTION 8. NEGATIVE COVENANTS
The Parent Borrower hereby agrees that, from and after the Effective
Date and so long as the Revolving Credit Commitments remain in effect, and
thereafter until payment in full of the Loans, all Reimbursement Obligations and
any other amount then due and owing to any Lender or the Administrative Agent
hereunder and under any Note and termination or expiration of all Letters of
Credit, the Parent Borrower shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly:
8.1 Financial Condition Covenants.
(a) Maintenance of Consolidated Interest Coverage Ratio. Permit, at
the last day of any fiscal quarter ending during any test period set forth
below, the Consolidated Interest Coverage Ratio to be less than the ratio
set forth opposite such test period below:
Test Period Ratio
----------- -----
Effective Date - December 25, 1999 1.65 to 1.00
December 26, 1999 - December 30, 2000 1.80 to 1.00
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86
December 31, 2000 - December 29, 2001 2.00 to 1.00
December 30, 2001 - December 28, 2002 2.35 to 1.00
December 29, 2002 - December 27, 2003 2.65 to 1.00
Thereafter 3.00 to 1.00
provided that in the event that the Parent Borrower changes its fiscal
year end to the last day of December, the foregoing test periods for each
fiscal year of the Parent Borrower occurring after such change shall be
deemed to commence on January 1 of the applicable fiscal year and end on
December 31 of such fiscal year (e.g., the test period from December 31,
2000 through December 29, 2001 would become the period from January 1,
2001 through December 31, 2001).
(b) Maintenance of Leverage Ratio. Permit, at the last day of any
fiscal quarter ending during any test period set forth below, the Leverage
Ratio to be greater than the ratio set forth opposite such test period
below:
Test Period Ratio
----------- -----
Effective Date - December 25, 1999 5.50 to 1.00
December 26, 1999 - December 30 2000 5.15 to 1.00
December 31, 2000 - December 29, 2001 4.60 to 1.00
December 30, 2001 - December 28, 2002 4.00 to 1.00
December 29, 2002 - December 27, 2003 3.50 to 1.00
Thereafter 3.00 to 1.00
provided that in the event that the Parent Borrower changes its fiscal
year end to the last day of December, the foregoing test periods for each
fiscal year of the Parent Borrower occurring after such change shall be
deemed to commence on January 1 of the applicable fiscal year and end on
December 31 of such fiscal year (e.g., the test period from December 31,
2000 through December 29, 2001 would become the period from January 1,
2001 through December 31, 2001).
8.2 Limitation on Indebtedness. Create, incur, assume or suffer to
exist any Indebtedness (including any Indebtedness of any of its Subsidiaries),
except:
(a) Indebtedness of each of the Borrowers under this Agreement and
under any Notes;
(b) Indebtedness of the Parent Borrower to any of its Wholly Owned
Subsidiaries and of any Subsidiary of the Parent Borrower to the Parent
Borrower or any other Wholly Owned Subsidiary of the Parent Borrower;
(c) Indebtedness of the Parent Borrower and any of its Subsidiaries
incurred to finance or refinance the acquisition of fixed or capital
assets (whether pursuant to a loan, a Financing Lease or otherwise)
otherwise permitted pursuant to this Agreement, and any other Financing
Leases, in an aggregate principal amount not exceeding in the aggregate as
to the Parent
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87
Borrower and its Subsidiaries $40,000,000 at any time outstanding,
provided that such Indebtedness is incurred substantially simultaneously
with such acquisition or within six months after such acquisition or in
connection with a refinancing thereof;
(d) Indebtedness of any of the Borrowers under Interest Rate
Protection Agreements relating to Indebtedness of such Borrower under this
Agreement, and Indebtedness of the Parent Borrower and its Subsidiaries
under Permitted Hedging Arrangements;
(e) other Indebtedness outstanding on the Effective Date and listed
on Schedule 8.2(e) and any refinancings, refundings, renewals or
extensions thereof, provided that the amount of such Indebtedness is not
increased at the time of such refinancing, refunding, renewal or extension
except by an amount equal to the premium or other amounts paid, and fees
and expenses incurred, in connection with such refinancing and by an
amount equal to the unutilized commitments thereunder;
(f) to the extent that any Guarantee Obligation permitted under
subsection 8.4 constitutes Indebtedness, such Indebtedness;
(g) Indebtedness of the Parent Borrower or any of its Subsidiaries
pursuant to any Permitted Receivables Securitization, provided that upon
the effectiveness of any such Permitted Receivables Securitization, the
Term Loans shall be prepaid and the Revolving Credit Commitments shall be
automatically and permanently reduced in accordance with subsections
4.4(c) and 4.4(i);
(h) Indebtedness to finance the general working capital needs of the
Parent Borrower and its Subsidiaries incurred after the Termination Date
in an aggregate principal amount, when added to the aggregate Consolidated
Total Funded Indebtedness/Securitizations in respect of any Permitted
Receivables Securitizations at such time outstanding, not to exceed the
amount of the Revolving Credit Commitments as of the Effective Date,
provided that (i) the Revolving Credit Commitments shall have been or
shall concurrently be terminated and the Revolving Credit Loans shall have
been or shall concurrently be repaid in full and (ii) the terms and
conditions of such replacement working capital facility shall be
substantially similar to, or otherwise not less favorable to the Tranche B
Term Loan Lenders in any material respect than, the analogous provisions
applicable to the Revolving Credit Commitments;
(i) Indebtedness of Foreign Subsidiaries of the Parent Borrower (in
addition to Indebtedness of Foreign Subsidiaries of the Parent Borrower
permitted by subsection 8.2(e) and 8.2(o)) not exceeding, as to all such
Foreign Subsidiaries, $20,000,000 in aggregate principal amount at any one
time outstanding;
(j) Indebtedness of the Parent Borrower and any of its Subsidiaries
incurred to finance or refinance the purchase price of, or Indebtedness of
the Parent Borrower and any of its Subsidiaries assumed in connection
with, any acquisition permitted by subsection 8.10, provided that (i) such
Indebtedness is incurred prior to, substantially simultaneously with or
within six months after such acquisition or in connection with a
refinancing thereof, (ii) either (A) (x) such
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88
Indebtedness shall have terms and conditions reasonably satisfactory to
the Administrative Agent and (y) such Indebtedness (other than
Subordinated Debt) shall not exceed 60% of the purchase price of such
acquisition (including any Indebtedness (other than Subordinated Debt)
assumed in connection with such acquisition and any Guarantee Obligations
(other than any Guarantee Obligation in respect of any Subordinated Debt,
which Guarantee Obligation is subordinated on the same terms as such
Subordinated Debt) incurred in connection with such acquisition) (or such
greater percentage as shall be reasonably satisfactory to the
Administrative Agent or, if any such purchase price shall be greater than
$35,000,000, such greater percentage as shall be satisfactory to the
Required Lenders) or (B) the incurrence of such Indebtedness in connection
with such acquisition would be permitted by subsection 8.10(c), and (iii)
immediately after giving effect to such acquisition no Default or Event of
Default shall have occurred and be continuing;
(k) Indebtedness in respect of letters of credit (excluding Letters
of Credit) issued by a Lender or an affiliate of a Lender for the account
of the Parent Borrower and its Subsidiaries, provided that (i) the
aggregate amount of any such Indebtedness shall not exceed the Letter of
Credit commitment of the Issuing Lender pursuant to subsection 3.1(a)(ii)
and (ii) upon the effectiveness of any such letter of credit and for so
long as it remains outstanding, the Letter of Credit commitment of the
Issuing Lender pursuant to subsection 3.1(a)(ii) shall be reduced by an
amount equal to the aggregate amount of such Indebtedness;
(l) Indebtedness of the Parent Borrower or any of its Subsidiaries
in respect of Sale and Leaseback Transactions permitted under subsection
8.12;
(m) Indebtedness of the Parent Borrower or any of its Subsidiaries
incurred to finance insurance premiums in the ordinary course of business;
(n) Indebtedness arising from the honoring of a check, draft or
similar instrument against insufficient funds, provided that such
Indebtedness is extinguished within two Business Days of its incurrence;
(o) Indebtedness of any Foreign Subsidiary of the Parent Borrower
fully supported on the date of the incurrence thereof by a Foreign
Backstop Letter of Credit;
(p) Indebtedness of the Parent Borrower on account of the Senior
Subordinated Notes having a principal amount not exceeding $150,000,000 in
the aggregate at any one time outstanding; and
(q) additional Indebtedness of the Parent Borrower or any Subsidiary
of the Parent Borrower not exceeding $20,000,000 as to the Parent Borrower
and its Subsidiaries in aggregate principal amount at any one time
outstanding.
For purposes of determining compliance with clauses (c), (e), (h),
(i), (j), (k), (l), (o) and (q) of this subsection 8.2, the amount of any
Indebtedness denominated in any currency other than Dollars shall be calculated
based on customary currency exchange rates in effect, in the case of such
Indebtedness incurred (in respect of term debt) or committed (in respect of
revolving debt) on or prior
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89
to the Effective Date, on the Effective Date and, in the case of such
Indebtedness incurred (in respect of term debt) or committed (in respect of
revolving debt) after the Effective Date, on the date that such Indebtedness was
incurred (in respect of term debt) or committed (in respect of revolving debt).
8.3 Limitation on Liens. Create, incur, assume or suffer to exist
any Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except for:
(a) Liens for taxes not yet delinquent or the nonpayment of which in
the aggregate would not reasonably be expected to have a Material Adverse
Effect, or which are being contested in good faith by appropriate
proceedings diligently conducted and adequate reserves with respect
thereto are maintained on the books of Holding or its Subsidiaries, as the
case may be, in conformity with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business
which are not overdue for a period of more than 60 days or which are being
contested in good faith by appropriate proceedings diligently conducted;
(c) Liens of landlords or of mortgagees of landlords arising by
operation of law or pursuant to the terms of real property leases,
provided that the rental payments secured thereby are not yet due and
payable;
(d) pledges, deposits or other Liens in connection with workers'
compensation, unemployment insurance, other social security benefits or
other insurance related obligations (including, without limitation,
pledges or deposits securing liability to insurance carriers under
insurance or self-insurance arrangements);
(e) Liens arising by reason of any judgment, decree or order of any
court or other Governmental Authority, if appropriate legal proceedings
which may have been duly initiated for the review of such judgment, decree
or order, are being diligently prosecuted and shall not have been finally
terminated or the period within which such proceedings may be initiated
shall not have expired;
(f) Liens to secure the performance of bids, trade contracts (other
than for borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds, judgment and like bonds, replevin and similar
bonds and other obligations of a like nature incurred in the ordinary
course of business;
(g) zoning restrictions, easements, rights-of-way, restrictions on
the use of property, other similar encumbrances incurred in the ordinary
course of business and minor irregularities of title, which do not
materially interfere with the ordinary conduct of the business of the
Parent Borrower and its Subsidiaries taken as a whole;
(h) Liens securing or consisting of Indebtedness of the Parent
Borrower and its Subsidiaries permitted by subsection 8.2(c) incurred to
finance the acquisition of fixed or capital assets or Indebtedness of the
Parent Borrower and its Subsidiaries permitted by subsection 8.2(j)
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90
incurred to finance the purchase price of, or assumed in connection with,
any acquisition permitted by subsection 8.10, provided that (i) such Liens
shall be created substantially simultaneously with such acquisition and
(ii) such Liens securing such Indebtedness do not at any time encumber any
property other than the property financed by such Indebtedness;
(i) Liens existing on assets or properties at the time of the
acquisition thereof by the Parent Borrower or a Subsidiary which do not
materially interfere with the use of the property subject thereto or
extend to or cover any assets of the Parent Borrower or such Subsidiary
other than the assets or property being acquired;
(j) Liens (i) in existence on the Effective Date and listed in
Schedule 8.3(j) and other Liens securing Indebtedness of the Parent
Borrower and its Subsidiaries permitted by subsection 8.2(e), provided
that no such Lien is spread to cover any additional property after the
Effective Date and that the amount of Indebtedness secured thereby is not
increased except as permitted by subsection 8.2(e), or (ii) not otherwise
permitted hereunder, all of which Liens permitted pursuant to this
subsection 8.3(j) securing obligations not exceeding (as to the Parent
Borrower and all its Subsidiaries) $5,000,000 in aggregate amount at any
time outstanding;
(k) Liens securing Guarantee Obligations permitted under subsection
8.4(f) not exceeding (as to the Parent Borrower and all its Subsidiaries)
$2,000,000 in aggregate amount at any time outstanding;
(l) Liens created pursuant to the Security Documents or otherwise
securing Indebtedness permitted by subsection 8.2(a);
(m) Liens created pursuant to and in accordance with any Permitted
Receivables Securitization;
(n) Liens on Intellectual Property and foreign patents, patent
applications, trademarks, trademark applications, trade names, service
marks, copyrights, technology, know-how and processes to the extent such
Liens arise from the granting of licenses to use such Intellectual
Property and foreign patents, patent applications, trademarks, trademark
applications, trade names, service marks, copyrights, technology, know-how
and processes to any Person in the ordinary course of business of the
Parent Borrower and its Subsidiaries;
(o) Liens on equipment in favor of lessees or conditional purchasers
of such equipment leased on a Financing Lease basis or sold on a
conditional basis by the Parent Borrower or any of its Subsidiaries to
Agents or Owner/Operators in the ordinary course of business of the Parent
Borrower and its Subsidiaries;
(p) any encumbrance or restriction (including, without limitation,
put and call agreements) with respect to the Capital Stock of any joint
venture or similar arrangement pursuant to the joint venture or similar
agreement with respect to such joint venture or similar arrangement,
provided that no such encumbrance or restriction affects in any way the
ability of the Parent Borrower or any of its Subsidiaries to comply with
subsection 8.16(b);
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(q) Liens on property subject to Sale and Leaseback Transactions
permitted under subsection 8.12 and general intangibles related thereto;
(r) Liens on property of any Foreign Subsidiary of the Parent
Borrower securing Indebtedness of such Foreign Subsidiary of the Parent
Borrower permitted by subsection 8.2(i); and
(s) Liens on assets or properties of any Insurance Subsidiary
arising by operation of applicable insurance law or required to be imposed
thereunder in the ordinary course of such Subsidiary's insurance business.
8.4 Limitation on Guarantee Obligations. Create, incur, assume or
suffer to exist any Guarantee Obligation except:
(a) Guarantee Obligations in existence on the Effective Date and
listed in Schedule 8.4(a), and any refinancings, refundings, extensions or
renewals thereof, provided that the amount of such Guarantee Obligation
shall not be increased at the time of such refinancing, refunding,
extension or renewal except to the extent that the amount of Indebtedness
in respect of such Guarantee Obligations is permitted to be increased by
subsection 8.2(e);
(b) Guarantee Obligations in connection with up to an aggregate
principal amount of $10,000,000 of Indebtedness outstanding at any time
incurred by Management Investors in connection with any Management
Subscription Agreement, and any refinancings, refundings, extensions or
renewals thereof, provided that such amount shall be reduced by the
aggregate then outstanding principal amount of loans and advances
permitted by subsection 8.9(n);
(c) Guarantee Obligations for performance, appeal, judgment,
replevin and similar bonds, or suretyship arrangements, all in the
ordinary course of business;
(d) Guarantee Obligations in respect of indemnification and
contribution agreements expressly permitted by subsection 8.11(iv) or
similar agreements by Holding or the Parent Borrower;
(e) Reimbursement Obligations in respect of the Letters of Credit
and reimbursement obligations owing to the issuer of any letter of credit
permitted by subsection 8.2(k);
(f) Guarantee Obligations in respect of third-party loans and
advances to officers or employees of the Parent Borrower or any Subsidiary
(i) for travel and entertainment expenses incurred in the ordinary course
of business, (ii) for relocation expenses incurred in the ordinary course
of business or (iii) for any other purpose and, in the case of this clause
(iii), in an aggregate principal amount (as to the Parent Borrower and all
its Subsidiaries), together with the aggregate amount of all Investments
permitted under subsection 8.9(e)(iii), of up to $2,000,000 outstanding at
any time;
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(g) obligations to insurers required in connection with worker's
compensation and other insurance coverage incurred in the ordinary course
of business;
(h) obligations of any of the Borrowers under any Interest Rate
Protection Agreements relating to Indebtedness of such Borrower under this
Agreement, and obligations of the Parent Borrower and its Subsidiaries
under Permitted Hedging Arrangements;
(i) guarantees made in the ordinary course of its business by the
Parent Borrower or any of its Subsidiaries of obligations of the Parent
Borrower or any of its Subsidiaries, which obligations are otherwise
permitted under this Agreement;
(j) Guarantee Obligations in connection with sales or other
dispositions permitted under subsection 8.6, including indemnification
obligations with respect to leases, and guarantees of collectability in
respect of accounts receivables or notes receivable for up to face value;
(k) accommodation guarantees for the benefit of trade creditors of
the Parent Borrower or any of its Subsidiaries in the ordinary course of
business of obligations of the Parent Borrower or any of its Subsidiaries,
which obligations are otherwise permitted by this Agreement;
(l) Guarantee Obligations with respect to an aggregate principal
amount of up to $20,000,000 of third-party loans and advances to Agents
and Owner/Operators, provided that such amount shall be reduced by the
aggregate then outstanding principal amount of loans permitted by
subsection 8.9(o);
(m) Guarantee Obligations of the Parent Borrower and its
Subsidiaries in respect of recourse events in connection with any
Permitted Receivables Securitization;
(n) Guarantee Obligations in respect of Indebtedness of a Person in
connection with a joint venture or similar arrangement in respect of which
no other co-investor or other Person has a greater legal or beneficial
ownership interest than the Parent Borrower or any of its Subsidiaries and
as to all of such Persons does not at any time exceed $10,000,000 in
aggregate principal amount, provided that such amount shall be reduced by
the aggregate amount of then existing Investments permitted by subsection
8.9(l);
(o) Guarantee Obligations incurred in connection with acquisitions
permitted under subsection 8.10, provided that either (i) any such
Guarantee Obligation (other than any Guarantee Obligation in respect of
any Subordinated Debt, which Guarantee Obligation is subordinated on the
same terms as such Subordinated Debt) shall not exceed, with respect to
any such acquisition, 60% of the purchase price of such acquisition
(including any Indebtedness (other than Subordinated Debt) incurred and/or
assumed in connection with any such acquisition) (or such greater
percentage as shall be reasonably satisfactory to the Administrative Agent
or, if any such purchase price shall be greater than $35,000,000, such
greater percentage as shall be satisfactory to the Required Lenders), or
(ii) if such Guarantee Obligation were
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treated as Indebtedness, the incurrence of such Indebtedness in connection
with such acquisitions would be permitted by subsection 8.10(c);
(p) Guarantee Obligations incurred pursuant to the Guarantees or
otherwise in respect of Indebtedness permitted by subsection 8.2(a); and
(q) Guarantee Obligations under the Subordinated Subsidiary
Guarantees in respect of the Senior Subordinated Notes, provided that such
Guarantee Obligations are subordinated on the same terms as the
obligations of the Parent Borrower in respect of the Senior Subordinated
Notes are subordinated.
8.5 Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer
or otherwise dispose of, all or substantially all of its property, business or
assets, except:
(a) any Subsidiary of the Parent Borrower may be merged or
consolidated with or into the Parent Borrower (provided that the Parent
Borrower shall be the continuing or surviving corporation) or with or into
any one or more Wholly Owned Subsidiaries of the Parent Borrower (provided
that the Wholly Owned Subsidiary or Subsidiaries of the Parent Borrower
shall be the continuing or surviving corporation and provided further that
no Domestic Subsidiary may be merged or consolidated with or into a
Foreign Subsidiary unless the continuing or surviving entity is a Domestic
Subsidiary);
(b) any Subsidiary of the Parent Borrower may sell, lease, transfer
or otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to the Parent Borrower or to any Wholly Owned
Subsidiary of the Parent Borrower that is a Guarantor;
(c) any Foreign Subsidiary of the Parent Borrower may sell, lease,
transfer or otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to any other Foreign Subsidiary that is a Wholly
Owned Subsidiary of the Parent Borrower, provided that if the Foreign
Subsidiary that so disposes of its assets is a Foreign Subsidiary
Borrower, either (i) such Foreign Subsidiary Borrower shall,
simultaneously with such disposition, repay in full all outstanding Loans
made to it, cash collateralize (on terms reasonably satisfactory to the
Administrative Agent) any outstanding L/C Obligations in respect of
Letters of Credit issued for its account, and terminate its right to
borrow hereunder or (ii) the transferee of such assets shall be a Foreign
Subsidiary Borrower; and
(d) as expressly permitted by subsection 8.6.
8.6 Limitation on Sale of Assets. (a) Convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, receivables and leasehold interests), whether
now owned or hereafter acquired, or, in the case of any Subsidiary, issue or
sell any shares of such Subsidiary's Capital Stock, to any Person other than the
Parent Borrower or any Wholly Owned Subsidiary of the Parent Borrower, except:
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(i) the sale or other Disposition of obsolete or worn out property,
whether now owned or hereafter acquired, in the ordinary course of
business;
(ii) the sale or other Disposition of any property (including
Inventory) in the ordinary course of business;
(iii) the sale or discount without recourse of accounts receivable
or notes receivable arising in the ordinary course of business, or the
conversion or exchange of accounts receivable into or for notes
receivable, in connection with the compromise or collection thereof,
provided that, in the case of any Foreign Subsidiary of the Parent
Borrower, any such sale or discount may be with recourse if such sale or
discount is consistent with customary practice in such Foreign
Subsidiary's country of business and the aggregate amount of any such
recourse shall (to the extent such recourse is required by GAAP to be
included as Indebtedness on the consolidated balance sheet of Holding and
its consolidated subsidiaries) be included in the determination of such
Foreign Subsidiary's Indebtedness for purposes of subsection 8.2(i);
(iv) as permitted by subsection 8.5(b) or 8.5(c) or pursuant to Sale
and Leaseback Transactions permitted by subsection 8.12;
(v) the sale, transfer or discount of Receivables pursuant to any
Permitted Receivables Securitization, provided that upon the effectiveness
of any such Permitted Receivables Securitization, the Term Loans shall be
prepaid and the Revolving Credit Commitments shall be automatically and
permanently reduced to the extent required by subsections 4.4(c) and
4.4(i);
(vi) Dispositions of any assets or property by the Parent Borrower
or any Subsidiary of the Parent Borrower to any Wholly Owned Subsidiary of
the Parent Borrower, provided that the Wholly Owned Subsidiary has
executed each of the guarantees and security documents required pursuant
to subsection 8.16(b);
(vii) any other Asset Sales by the Parent Borrower or any of its
Subsidiaries the Net Cash Proceeds of which do not exceed $10,000,000 per
annum and $30,000,000 in the aggregate after the Effective Date and the
non-cash portion of the consideration for any such Asset Sale does not
exceed 25% thereof, provided that an amount equal to 100% of such Net Cash
Proceeds of any such Asset Sale less the Reinvested Amount is applied in
accordance with subsection 4.4(c);
(viii) the abandonment or other Disposition of patents, trademarks
or other intellectual property that are, in the reasonable judgment of the
Parent Borrower, no longer economically practicable to maintain or useful
in the conduct of the business of the Parent Borrower and its Subsidiaries
taken as a whole;
(ix) Dispositions permitted by subsection 8.9(m), provided that an
amount equal to 100% of the Net Cash Proceeds of any such Asset Sale less
the Reinvested Amount is applied in accordance with subsection 4.4(c);
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(x) Dispositions of equipment to Agents and Owner/Operators,
including sales pursuant to lease or conditional sales agreements,
provided that an amount equal to 100% of the Net Cash Proceeds of any such
Asset Sale less the Reinvested Amount is applied in accordance with
subsection 4.4(c); and
(xi) the Disposition of any Subsidiary that is not a Material
Subsidiary.
(b) Convey, sell or otherwise transfer shares of Capital Stock of a
Foreign Subsidiary to Holding or any Domestic Subsidiary of Holding unless at
the time of such conveyance, sale or transfer (or promptly thereafter) Holding
or such Domestic Subsidiary shall execute and deliver to the Administrative
Agent a stock pledge agreement and take any necessary steps to perfect the
security interest to be created thereby (which security interest shall not apply
to (i) more than 65% of Holding's or such Domestic Subsidiary's ownership
interest in any Foreign Subsidiary or (ii) any ownership interest in a
non-Wholly Owned Foreign Subsidiary to the extent that the grant of such
security interest would violate the terms of any agreements under which the
Investment by Holding or any or its Subsidiaries was made therein).
8.7 Limitation on Loans and Dividends to Holding. Make any advance,
loan or extension or credit to Holding or declare or pay any dividend (other
than dividends payable solely in common stock of the Parent Borrower or options,
warrants or other rights to purchase common stock of the Parent Borrower) on, or
make any payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, defeasance, retirement or other
acquisition of, any shares of any class of Capital Stock of the Parent Borrower
or any warrants or options to purchase any such Capital Stock, whether now or
hereafter outstanding, or make any other distribution (other than distributions
payable solely in common stock of the Parent Borrower or options, warrants or
other rights to purchase common stock of the Parent Borrower) in respect
thereof, either directly or indirectly, whether in cash or property or in
obligations of the Parent Borrower or any Subsidiary, except that:
(a) the Parent Borrower and any of its Subsidiaries may make loans
and advances, and the Parent Borrower may pay cash dividends, to Holding
in an aggregate amount sufficient to allow Holding to pay expenses
incurred in the ordinary course of business in an aggregate amount not to
exceed $2,000,000 in any fiscal year;
(b) the Parent Borrower and any of its Subsidiaries may make loans
and advances, and the Parent Borrower may pay cash dividends, to Holding
in an aggregate amount sufficient to cover reasonable and necessary
expenses (including professional fees and expenses) incurred by Holding in
connection with (i) registration, public offerings and exchange listing of
equity or debt securities and maintenance of the same, (ii) compliance
with reporting obligations under federal or state laws or under this
Agreement or any of the other Loan Documents and (iii) indemnification and
reimbursement of directors, officers and employees in respect of
liabilities relating to their serving in any such capacity;
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(c) the Parent Borrower and any of its Subsidiaries may make loans
and advances, and the Parent Borrower may pay cash dividends, to Holding
in an aggregate amount sufficient to pay tax liabilities of Holding which
are paid in cash by Holding to any taxing authority;
(d) the Parent Borrower and any of its Subsidiaries may make loans
and advances, and the Parent Borrower may pay cash dividends, to Holding
in an aggregate amount sufficient to allow Holding to repurchase shares of
its common stock or options in respect thereof issued pursuant to any
Management Subscription Agreement, as any such agreement may be amended
from time to time, which may be entered into between Holding and certain
Management Investors, for an aggregate purchase price not to exceed
$10,000,000, provided that such amount shall be increased by (i) an amount
equal to $2,000,000 on each anniversary of the Effective Date, commencing
on the first anniversary of the Effective Date, and (ii) an amount equal
to the proceeds contributed in cash by Holding to the Parent Borrower of
any resales or new issuances of shares and options to any such Management
Investors, at any time after the initial issuances to any Management
Investors, together with the aggregate amount of deferred compensation
owed by the Parent Borrower or any of its Subsidiaries to any such
Management Investor that shall thereafter have been canceled, waived or
exchanged at any time after the initial issuances to any thereof in
connection with the grant to such Management Investor of the right to
receive or acquire shares of Holding common stock;
(e) the Parent Borrower and any of its Subsidiaries may make loans
and advances, and the Parent Borrower may pay cash dividends, to Holding
in an aggregate amount of up to $500,000 to allow Holding to pay interest
on the Holding Loan;
(f) after November 19, 2004, the Parent Borrower and any of its
Subsidiaries may make loans and advances, and the Parent Borrower may pay
cash dividends, to Holding in an aggregate amount sufficient to allow
Holding to pay scheduled cash dividends on the shares of Holding Preferred
Stock (if applicable) and to pay scheduled interest on the Holding Senior
Discount Notes and the Holding Subordinated Exchange Debentures (if
applicable), provided that, in each case, no Default or Event of Default
shall have occurred and be continuing or would result from the payment of
such cash dividend; and
(g) the Parent Borrower and any of its Subsidiaries may make loans
and advances, and the Parent Borrower may pay cash dividends, to Holding
in an aggregate amount sufficient to allow Holding to pay all fees and
expenses incurred in connection with the Acquisition, this Agreement and
the transactions expressly contemplated hereby and thereby.
8.8 Limitation on Capital Expenditures. Make or commit to make any
Capital Expenditures (excluding any expenses incurred in connection with normal
replacement and maintenance programs properly charged to current operations and
excluding any Reinvested Amounts); provided that the Parent Borrower and its
consolidated Subsidiaries may make Capital Expenditures in an amount not to
exceed, for any fiscal year of the Parent Borrower set forth below, the sum of
(a) the amount set forth opposite such fiscal year below:
Fiscal Year Amount
----------- ------
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1999 $45,000,000
2000 $55,000,000
2001 and thereafter $60,000,000
plus (b) an amount up to the Available Adjustment to the extent such amount is
used for Capital Expenditures for the development and implementation of an
e-commerce strategy or the development and implementation of new information
technology; provided that the unused amount of any Capital Expenditures
permitted to be made pursuant to the foregoing clause (a) during any fiscal year
and not made during such fiscal year may be carried over and expended during the
next succeeding fiscal year (any amount so carried over to be deemed the first
amount applied and expended for Capital Expenditures during such next succeeding
fiscal year).
8.9 Limitation on Investments, Loans and Advances. Make any advance,
loan, extension of credit or capital contribution to, or purchase any stock,
bonds, notes, debentures or other securities of or any assets constituting a
business unit of, or make any other investment in (each an "Investment"), any
Person, except:
(a) extensions of trade credit in the ordinary course of business;
(b) Investments in Cash Equivalents;
(c) Investments existing on the Effective Date and described in
Schedule 8.9(c), setting forth the respective amounts of such Investments
as of a recent date;
(d) Investments in notes receivable in connection with transactions
permitted by subsection 8.6(a)(iii);
(e) loans and advances to officers, directors or employees of
Holding, the Parent Borrower or any of their respective Subsidiaries (i)
in the ordinary course of business for travel and entertainment or
relocation expenses, (ii) existing on the Effective Date and described in
Schedule 8.9(c), (iii) made after the Effective Date for other purposes,
not to exceed (as to Holding and all its Subsidiaries), together with the
amount of all Guarantee Obligations permitted pursuant to subsection
8.4(f)(iii), $4,000,000 in the aggregate outstanding at any time or (iv)
relating to indemnification or reimbursement of any officers, directors or
employees in respect of liabilities relating to their serving in any such
capacity or as otherwise specified in subsection 8.11;
(f) Investments by the Parent Borrower in its Wholly Owned
Subsidiaries (other than any Receivables Subsidiary) and by such
Subsidiaries in the Parent Borrower and in Wholly Owned Subsidiaries of
the Parent Borrower (other than any Receivables Subsidiary);
(g) acquisitions expressly permitted by subsection 8.10;
(h) Investments of any of the Borrowers under Interest Rate
Protection Agreements relating to Indebtedness of such Borrower under this
Agreement, and Investments by the Parent Borrower and its Subsidiaries
under Permitted Hedging Arrangements;
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(i) any Investment by the Parent Borrower and its Subsidiaries
which, in the judgment of the Parent Borrower, is reasonably necessary in
connection with, and pursuant to, any Permitted Receivables
Securitization;
(j) Investments in the nature of pledges or deposits with respect to
leases or utilities provided to third parties in the ordinary course of
business or otherwise described in subsection 8.3(c), (d) or (f);
(k) Investments representing non-cash consideration received by the
Parent Borrower or any of its Subsidiaries in connection with any Asset
Sale, provided that in the case of any Asset Sale permitted under
subsection 8.6(a)(vii), such non-cash consideration constitutes not more
than 25% of the aggregate consideration received in connection with such
Asset Sale and any such non-cash consideration received by the Parent
Borrower or any of its Subsidiaries (other than Foreign Subsidiaries to
the extent that the Parent Borrower's obligations would be secured by a
pledge of such non-cash consideration) is pledged to the Administrative
Agent for the benefit of the Lenders pursuant to the Security Documents;
(l) Investments by the Parent Borrower or any of its Subsidiaries in
a Person in connection with a joint venture or similar arrangement in
respect of which no other co-investor or other Person has a greater legal
or beneficial ownership interest than the Parent Borrower or such
Subsidiary in an aggregate amount not to exceed at any time an amount
equal to $10,000,000, provided that such amount shall be reduced by the
aggregate principal amount of Indebtedness in respect of Guarantee
Obligations permitted by subsection 8.4(n);
(m) Investments representing evidences of Indebtedness, securities
or other property received from another Person by the Parent Borrower or
any of its Subsidiaries in connection with any bankruptcy proceeding or
other reorganization of such other Person or as a result of foreclosure,
perfection or enforcement of any Lien or exchange for evidences of
Indebtedness, securities or other property of such other Person held by
the Parent Borrower or any of its Subsidiaries, provided that any such
securities or other property received by the Parent Borrower or any of its
Subsidiaries (other than Foreign Subsidiaries (to the extent that the
Parent Borrower's obligations would be secured by a pledge of such
securities or other property) and any Insurance Subsidiary) is, to the
extent required under the Guarantee and Collateral Agreement, pledged to
the Administrative Agent for the benefit of the Lenders pursuant to the
Security Documents, and provided, further, that in the event that the
aggregate expected value of such securities or other property received
with respect to a Person is less than $250,000, the Parent Borrower or
such Subsidiary may, rather than pledge such securities and other property
to the Administrative Agent, dispose of such securities and other property
within 180 days of the receipt thereof so long as the Net Cash Proceeds of
such Disposition are utilized to prepay the Loans pursuant to subsection
4.4(c), and any such securities and other property not so disposed of by
such 180th day shall, to the extent required under the Guarantee and
Collateral Agreement, be pledged to the Administrative Agent for the
benefit of the Lenders pursuant to the Security Documents;
(n) loans and advances to Management Investors in connection with
the purchase by such Management Investors of Capital Stock of Holding of
up to $10,000,000 outstanding at any one
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time, provided that such amount shall be reduced by the aggregate
principal amount of Indebtedness in respect of Guarantee Obligations
permitted by subsection 8.4(b);
(o) loans of up to $20,000,000 outstanding at any one time to Agents
and Owner/Operators in the ordinary course of business for working capital
purposes, provided that such amount shall be reduced by the aggregate
principal amount of loans and advances in respect of Guarantee Obligations
permitted by subsection 8.4(l);
(p) advances to Agents and Owner/Operators in the ordinary course of
business for working capital purposes;
(q) Investments by the Parent Borrower and its Subsidiaries
represented by any Financing Lease or conditional sale of equipment by the
Parent Borrower or any of its Subsidiaries to Agents or Owner/Operators;
(r) Investments constituting, or acquired with amounts constituting,
reserves or surplus maintained by any Insurance Subsidiary in accordance
with any Requirement of Law in respect of obligations pursuant to
insurance policies issued by such Insurance Subsidiary in the ordinary
course of its insurance business;
(s) loans and advances by the Parent Borrower or any of its
Subsidiaries to Holding expressly permitted by subsection 8.7; and
(t) Investments not otherwise permitted by the preceding clauses of
this subsection 8.9 not to exceed in the aggregate $10,000,000.
8.10 Limitations on Certain Acquisitions. Acquire by purchase or
otherwise all the business or assets of, or stock or other evidences of
beneficial ownership of, any Person, except that the Parent Borrower and its
Subsidiaries shall be allowed to make any such acquisitions so long as:
(a) such acquisition is expressly permitted by subsection 8.5;
(b) the aggregate consideration (including cash and any Indebtedness
assumed in connection with such acquisitions) for all such acquisitions
made pursuant to this clause (b) since the Effective Date does not exceed
$35,000,000;
(c) (i) such acquisition is made at a time when the Senior Debt
Ratio, calculated on a pro forma basis after giving effect to such
acquisition (such calculation to be made in a manner reasonably
satisfactory to the Administrative Agent and to be evidenced by a
certificate in form and substance reasonably satisfactory to the
Administrative Agent signed by a Responsible Officer of the Parent
Borrower and delivered to the Administrative Agent (which shall promptly
deliver copies to each Lender) at least three Business Days prior to the
consummation of such acquisition), is less than 2.50 to 1.00 and the
Leverage Ratio (calculated on a pro forma basis in the manner set forth
above with respect to the Senior Debt Ratio) is less than 4.00 to 1.00 and
(ii) the aggregate consideration
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(including cash and any Indebtedness assumed in connection with such
acquisitions) for all such acquisitions pursuant to this clause (c) since
the Effective Date does not exceed $75,000,000; or
(d) the aggregate consideration for such acquisition consists
exclusively of Capital Stock thereof and no Indebtedness is assumed by the
Parent Borrower and or any of its Subsidiaries in connection with any such
acquisition pursuant to this clause (d);
provided in each case that, (x) the target of such acquisition has positive
EBITDA, calculated on a pro forma basis after giving effect to such acquisition
(such calculation to be made in a manner reasonably satisfactory to the
Administrative Agent and to be evidenced by a certificate in form and substance
reasonably satisfactory to the Administrative Agent signed by a Responsible
Officer of the Parent Borrower and delivered to the Administrative Agent (which
shall promptly deliver copies to each Lender) at least three Business Days prior
to the consummation of such acquisition) and (y) after giving effect thereto, no
Default or Event of Default shall occur as a result of such acquisition.
8.11 Limitation on Transactions with Affiliates. Enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of property or the rendering of any service, with any Affiliate of the
Parent Borrower unless such transaction is (a) otherwise permitted under this
Agreement, and (b) upon terms no less favorable to the Parent Borrower or such
Subsidiary, as the case may be, than it would obtain in a comparable arm's
length transaction with a Person which is not an Affiliate; provided that
nothing contained in this subsection 8.11 shall be deemed to prohibit:
(i) the Parent Borrower or any of its Subsidiaries from
entering into or performing any consulting, management or employment
agreements or other compensation arrangements with a director, officer or
employee of Holding or any of its Subsidiaries, provided that the annual
aggregate base compensation with respect to any such director, in its
capacity as such, is not in excess of $200,000;
(ii) the Parent Borrower or any of its Subsidiaries from
entering into or performing an agreement with CD&R for the rendering of
management consulting or financial advisory services for compensation not
to exceed in the aggregate $1,000,000 per year plus reasonable
out-of-pocket expenses;
(iii) the payment of transaction expenses in connection with
this Agreement, the Acquisition and the other transactions related hereto
and thereto (including, without limitation, a transaction fee to CD&R in
an amount not to exceed $5,000,000);
(iv) the Parent Borrower or any of its Subsidiaries from
entering into, making payments pursuant to and otherwise performing an
indemnification and contribution agreement in favor of CD&R, CD&R Fund V,
the Affiliates thereof and each person who becomes a director, officer,
agent or employee of Holding, the Parent Borrower or any of their
respective Subsidiaries, in respect of liabilities (A) arising under the
Securities Act, the Exchange Act and any other applicable securities laws
or otherwise, in connection with any offering of securities by Holding or
any of its Subsidiaries, (B) incurred to third parties for any action or
failure to act of Holding or any of its Subsidiaries, predecessors or
successors, (C) arising out of the performance by CD&R of
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management consulting or financial advisory services provided to Holding
or any of its Subsidiaries, (D) arising out of the fact that any
indemnitee was or is a director, officer, agent or employee of Holding or
any of its Subsidiaries, or is or was serving at the request of any such
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or enterprise or (E) to the
fullest extent permitted by Delaware or other applicable state law, out of
any breach or alleged breach by such indemnitee of his or her fiduciary
duty as a director or officer of Holding or any of its Subsidiaries;
(v) the Parent Borrower or any of its Subsidiaries from
performing any agreements or commitments with or to any Affiliate existing
on the Effective Date and described on Schedule 8.11(v); or
(vi) any transaction permitted under subsection 8.3(k),
8.4(b), 8.4(d), 8.4(f), 8.5, 8.7, 8.9(e), 8.9(n), 8.9(o), 8.9(p) or
8.9(q), or any transaction with a Wholly Owned Subsidiary of the Parent
Borrower.
For purposes of this subsection 8.11, (A) any transaction with any Affiliate
shall be deemed to have satisfied the standard set forth in subparagraph (b) of
the first sentence hereof if (i) such transaction is approved by a majority of
the Disinterested Directors of the Board of Directors of the Parent Borrower or
the applicable Subsidiary, or (ii) in the event that at the time of any such
transaction, there are no Disinterested Directors serving on the Board of
Directors of the Parent Borrower or such Subsidiary, such transaction shall be
approved by a nationally recognized expert with expertise in appraising the
terms and conditions of the type of transaction for which approval is required,
and (B) "Disinterested Director" shall mean, with respect to any Person and
transaction, a member of the Board of Directors of such Person who does not have
any material direct or indirect financial interest in or with respect to such
transaction.
8.12 Limitation on Sales and Leasebacks. Enter into any arrangement
with any Person providing for the leasing by the Parent Borrower or any
Subsidiary of real or personal property which has been or is to be sold or
transferred by the Parent Borrower or such Subsidiary to such Person or to any
other Person to whom funds have been or are to be advanced by such Person on the
security of such property or rental obligations of the Parent Borrower or such
Subsidiary (any of such arrangements, a "Sale and Leaseback Transaction"), other
than in connection with any Disposition permitted under subsection 8.6., unless
(a) in the case of any Financing Lease pursuant to such arrangement, the
incurrence of such Financing Lease is permitted under subsection 8.2 or (b) in
the case of any other lease pursuant to such arrangements, (i) the lease
payments thereunder will be treated as an operating expense for purposes of
determining EBITDA and (ii) the aggregate Net Cash Proceeds from all Sale and
Leaseback Transactions permitted by this clause (b) shall not during the term of
this Agreement exceed $30,000,000 plus the aggregate amount of such Net Cash
Proceeds applied to prepay the Loans pursuant to subsection 4.4(c).
8.13 Limitations on Dispositions of Collateral. Convey, sell,
transfer, lease, or otherwise dispose of any of the Collateral, or attempt,
offer or contract to do so, except for (a) mergers, consolidations, sales,
leases, transfers or other Dispositions expressly permitted under subsection 8.5
and (b) sales or other Dispositions expressly permitted under subsection 8.6,
including sales of
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Inventory in the ordinary course of business; and the Administrative Agent
shall, and the Lenders hereby authorize the Administrative Agent to, execute
such releases of Liens and take such other actions as the Parent Borrower may
reasonably request in connection with the foregoing.
8.14 Limitation on Changes in Fiscal Year. Permit the fiscal year of
Holding, the Parent Borrower or any of its Subsidiaries to end on a day other
than the last Saturday of December or the last day of December.
8.15 Limitation on Negative Pledge Clauses. Enter into with any
Person any agreement, other than (a) this Agreement and the other Loan Documents
and (b) any industrial revenue or development bonds, purchase money mortgages,
acquisition agreements or Financing Leases or agreements in connection with any
Permitted Receivables Securitization permitted by this Agreement (in which
cases, any prohibition or limitation shall only be effective against the assets
financed or acquired thereby) or operating leases of real property entered into
in the ordinary course of business, which prohibits or limits the ability of the
Parent Borrower or any of its Subsidiaries (other than Foreign Subsidiaries and
Insurance Subsidiaries) to create, incur, assume or suffer to exist any Lien in
favor of the Lenders with respect to the obligations secured by the Security
Documents upon any of its property, assets or revenues, whether now owned or
hereafter acquired.
8.16 Limitation on Lines of Business; Creation of Subsidiaries. (a)
Enter into any business, either directly or through any Subsidiary, except for
those businesses of the same general type as those in which the Parent Borrower
and its Subsidiaries are engaged on the date of this Agreement or which are
related thereto, or permit any Insurance Subsidiary to engage in any business
other than the operation of a multiple-line property and liability insurance
program under the insurance laws of the States of Indiana and Illinois and
Ireland to insure Agents and Owner/Operators against loss from certain risks.
(b) Create any new Subsidiaries of the Parent Borrower other than
(i) any Receivables Subsidiary the relevant parent corporation of which shall
execute and deliver a stock pledge agreement and deliver or cause to be
delivered to the Administrative Agent the stock certificates representing all of
the outstanding Capital Stock of such new Receivables Subsidiary, together with
undated stock powers for each such certificate executed in blank by a duly
authorized officer of such parent corporation, or (ii) any other new Subsidiary
that (in the case of a new Domestic Subsidiary or a new Foreign Subsidiary
Borrower) shall execute and deliver to the Administrative Agent, as applicable,
the Guarantee and Collateral Agreement and appropriate Mortgages and other
security documents and take any necessary steps to perfect the security interest
to be created thereby and for which the relevant parent corporation (if such
parent corporation is the Parent Borrower or a Domestic Subsidiary) shall
execute and deliver to the Administrative Agent a stock pledge agreement and
take any necessary steps to perfect the security interest to be created thereby
(which security interest shall not apply to more than 65% of such parent
corporation's ownership interest in any Foreign Subsidiary Borrower).
8.17 Limitation on Optional Payments and Modifications of Debt
Instruments and other Material Agreements. (a) Make any optional payment,
prepayment, repurchase or redemption of the Senior Subordinated Notes or make
any payments on account of or for a sinking or other analogous fund for the
repurchase, redemption, defeasance or other acquisition thereof (other than
scheduled
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payments of principal and interest and payments of, in each case, fees and
expenses required by the Senior Subordinated Notes or the Senior Subordinated
Note Indenture, only to the extent permitted under the subordination provisions,
if any, applicable thereto).
(b) Make any amendment, supplement, modification or waiver of any of
the terms of the Senior Subordinated Notes or the Senior Subordinated Note
Indenture (i) which amends or modifies the subordination provisions contained in
the Senior Subordinated Notes or the Senior Subordinated Note Indenture, (ii)
which shortens the fixed maturity or increases the principal amount of, or
increases the rate or shortens the time of payment of interest on, or increases
the amount or shortens the time of payment of any principal or premium payable
whether at maturity, at a date fixed for prepayment or by acceleration or
otherwise of the Indebtedness evidenced by the Senior Subordinated Notes or
increases the amount of, or accelerates the time of payment of, any fees or
other amounts payable to any holder thereof in connection therewith, (iii) which
relates to any material affirmative or negative covenants or any events of
default or remedies thereunder and the effect of which, in the Parent Borrower's
good faith judgment, is to subject the Parent Borrower, or any of its
Subsidiaries, to any more onerous or more restrictive provisions or (iv) which
otherwise adversely affects, in the Parent Borrower's good faith judgment, the
interests of the Lenders as senior creditors with respect to the Senior
Subordinated Notes or the interests of the Lenders hereunder in any material
respect.
(c) In the event of the occurrence of a Change of Control, make any
payment, prepayment, repurchase or redemption of any Senior Subordinated Notes,
or make any payments on account of or for a sinking or other analogous fund for
the repurchase, redemption, defeasance or other acquisition thereof, unless the
Parent Borrower and the other Borrowers shall have (i) made payment in full of
the Loans, all Reimbursement Obligations and any other amounts then due and
owing to any Lender or the Administrative Agent hereunder and under any Note and
cash collateralized the L/C Obligations on terms reasonably satisfactory to the
Administrative Agent or (ii) made an offer to pay the Loans, all Reimbursement
Obligations and any amounts then due and owing to each Lender and the
Administrative Agent hereunder and under any Note and to cash collateralize the
L/C Obligations in respect of each Lender and shall have made payment in full
thereof to each such Lender or the Administrative Agent which has accepted such
offer and cash collateralized the L/C Obligations in respect of each such Lender
which has accepted such offer.
(d) Designate any Indebtedness (other than the obligations hereunder
and under the other Loan Documents) as "Designated Senior Indebtedness" for the
purposes of any Indenture.
SECTION 9. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) Any of the Borrowers shall fail to pay any principal of any Loan
or any Reimbursement Obligation when due in accordance with the terms
hereof; or any of the Borrowers shall fail to pay any interest on any
Loan, or any other amount payable hereunder, within five days after any
such interest or other amount becomes due in accordance with the terms
hereof; or
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(b) Any representation or warranty made or deemed made by any Loan
Party herein or in any other Loan Document (or in any amendment,
modification or supplement hereto or thereto) or which is contained in any
certificate furnished at any time by or on behalf of any Loan Party
pursuant to this Agreement or any such other Loan Document shall prove to
have been incorrect in any material respect on or as of the date made or
deemed made; or
(c) Any Loan Party shall default in the observance or performance of
any agreement contained in (i) subsection 7.7(a), subsection 7.11 or
Section 8 of this Agreement or (ii) Section 5.4 of the Guarantee and
Collateral Agreement, and, in the case of a default in the observance or
performance of its obligations under subsection 7.7(a) hereof, such
default shall have continued unremedied for a period of two days after a
Responsible Officer of the Parent Borrower shall have discovered or should
have discovered such default; or
(d) Any Loan Party shall default in the observance or performance of
any other agreement contained in this Agreement or any other Loan Document
(other than as provided in paragraphs (a) through (c) of this Section 9),
and such default shall continue unremedied for a period ending on the
earlier of (i) the date 32 days after a Responsible Officer of the Parent
Borrower shall have discovered or should have discovered such default and
(ii) the date 15 days after written notice has been given to the Parent
Borrower by the Administrative Agent or the Required Lenders; or
(e) Holding or any of its Subsidiaries shall (i) default in any
payment of principal of or interest on any Indebtedness (other than the
Holding Loan, the Loans and the Reimbursement Obligations) in excess of
$7,500,000 or in the payment of any Guarantee Obligation in excess of
$7,500,000, beyond the period of grace (not to exceed 30 days), if any,
provided in the instrument or agreement under which such Indebtedness or
Guarantee Obligation was created; or (ii) default in the observance or
performance of any other agreement or condition relating to any
Indebtedness or Guarantee Obligation referred to in clause (i) above or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event shall occur or condition exist, the effect of
which default or other event or condition is to cause, or to permit the
holder or holders of such Indebtedness or beneficiary or beneficiaries of
such Guarantee Obligation (or a trustee or agent on behalf of such holder
or holders or beneficiary or beneficiaries) to cause, with the giving of
notice or lapse of time if required, such Indebtedness to become due prior
to its stated maturity or such Guarantee Obligation to become payable (an
"Acceleration"), and such time shall have lapsed and, if any notice (a
"Default Notice") shall be required to commence a grace period or declare
the occurrence of an event of default before notice of Acceleration may be
delivered, such Default Notice shall have been given; or
(f) (i) Holding, any Borrower or any Material Subsidiary shall
commence any case, proceeding or other action (A) under any existing or
future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to
have an order for relief entered with respect to it, or seeking to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution, composition
or other relief with respect to it or its debts, or (B) seeking
appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets,
or Holding, any Borrower or any Material Subsidiary shall make a general
assignment for the benefit of
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its creditors; or (ii) there shall be commenced against Holding, any
Borrower or any Material Subsidiary any case, proceeding or other action
of a nature referred to in clause (i) above which (A) results in the entry
of an order for relief or any such adjudication or appointment or (B)
remains undismissed, undischarged, unstayed or unbonded for a period of 60
days; or (iii) there shall be commenced against Holding, any Borrower or
any Material Subsidiary any case, proceeding or other action seeking
issuance of a warrant of attachment, execution, distraint or similar
process against all or any substantial part of its assets which results in
the entry of an order for any such relief which shall not have been
vacated, discharged, stayed or bonded pending appeal within 60 days from
the entry thereof; or (iv) Holding, any Borrower or any Material
Subsidiary shall take any corporate action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the
acts set forth in clause (i), (ii), or (iii) above; or (v) Holding, any
Borrower or any Material Subsidiary shall be generally unable to, or shall
admit in writing its general inability to, pay its debts as they become
due; or
(g) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any
Plan, (ii) any "accumulated funding deficiency" (as defined in Section 302
of ERISA), whether or not waived, shall exist with respect to any Plan or
any Lien in favor of the PBGC or a Plan shall arise on the assets of the
Parent Borrower or any Commonly Controlled Entity, (iii) a Reportable
Event shall occur with respect to, or proceedings shall commence to have a
trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Single Employer Plan, which Reportable Event or
commencement of proceedings or appointment of a trustee is reasonably
likely to result in the termination of such Plan for purposes of Title IV
of ERISA (other than a standard termination pursuant to Section 4041(b) of
ERISA), (iv) any Single Employer Plan shall terminate for purposes of
Title IV of ERISA, (v) the Parent Borrower or any Commonly Controlled
Entity shall, or is reasonably likely to, incur any liability in
connection with a withdrawal from, or the Insolvency or Reorganization of,
a Multiemployer Plan, (vi) the occurrence or expected occurrence of any
event or condition which results or is reasonably likely to result in the
Parent Borrower's or any Commonly Controlled Entity's becoming responsible
for any liability in respect of a Former Plan, or (vii) any other event or
condition shall occur or exist with respect to a Plan; and in each case in
clauses (i) through (vii) above, such event or condition, together with
all other such events or conditions, if any, would be reasonably expected
to result in liability which would have a Material Adverse Effect; or
(h) One or more judgments or decrees shall be entered against
Holding or any of its Subsidiaries involving in the aggregate at any time
a liability (net of any insurance or indemnity payments actually received
in respect thereof prior to or within 60 days from the entry thereof, or
to be received in respect thereof in the event any appeal thereof shall be
unsuccessful) of $7,500,000 or more, and all such judgments or decrees
shall not have been vacated, discharged, stayed or bonded pending appeal
within 60 days from the entry thereof; or
(i) (i) Any of the Security Documents shall cease for any reason to
be in full force and effect (other than pursuant to the terms hereof or
thereof), or any Loan Party which is a party to any of the Security
Documents shall so assert in writing, or (ii) the Lien created by any of
the Security Documents shall cease to be perfected and enforceable in
accordance with its terms or of the same effect as to perfection and
priority purported to be created thereby with respect to any significant
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portion of the Collateral (other than in connection with any termination
of such Lien in respect of any Collateral as permitted hereby or by any
Security Document), and such failure of such Lien to be perfected and
enforceable with such priority shall have continued unremedied for a
period of 20 days; or
(j) Any Guarantee shall cease for any reason to be in full force and
effect (other than pursuant to the terms hereof or thereof) or any
Guarantor shall so assert in writing; or
(k) The Senior Subordinated Notes or the guarantees thereof, for any
reason, shall not be or shall cease to be validly subordinated as provided
therein and in the Senior Subordinated Note Indenture to the monetary
obligations of the Parent Borrower and its Subsidiaries under this
Agreement, any Notes and the other Loan Documents; or
(l) A Change of Control shall have occurred; or
(m) Any event entitling the Persons financing Receivables pursuant
to a Permitted Receivables Securitization to stop financing such
Receivables shall have occurred and be continuing and such Person shall
have stopped financing such Receivables; or
(n) Any Loan Document (other than this Agreement, any of the
Security Documents or any Guarantee) shall cease for any reason to be in
full force and effect (other than pursuant to the terms hereof or thereof)
or any Loan Party shall so assert in writing;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to any Borrower,
automatically the Revolving Credit Commitments shall immediately terminate and
the Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement (including, without limitation, all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
Credit shall have presented the documents required thereunder) and any Notes
shall immediately become due and payable, and (B) if such event is any other
Event of Default, either or both of the following actions may be taken: (i) with
the consent of the Required Lenders, the Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent shall, by notice to
the Parent Borrower, declare the Revolving Credit Commitments to be terminated
forthwith, whereupon the Revolving Credit Commitments shall immediately
terminate; and (ii) with the consent of the Required Lenders, the Administrative
Agent may, or upon the request of the Required Lenders, the Administrative Agent
shall, by notice to the Parent Borrower, declare the Loans hereunder (with
accrued interest thereon) and all other amounts owing under this Agreement
(including, without limitation, all amounts of L/C Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have presented
the documents required thereunder) and any Notes to be due and payable
forthwith, whereupon the same shall immediately become due and payable.
With respect to any Letter of Credit with respect to which
presentment for honor shall not have occurred at the time of an acceleration
pursuant to the preceding paragraph, the applicable Borrower in respect of such
Letter of Credit shall at such time deposit in a cash collateral account opened
by the Administrative Agent an amount equal to the aggregate then undrawn and
unexpired
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amount of such Letter of Credit. Each Borrower hereby grants to the
Administrative Agent, for the benefit of the Issuing Lender and the L/C
Participants, a security interest in such cash collateral to secure all
obligations of such Borrower in respect of such Letter of Credit under this
Agreement and the other Loan Documents. Each Borrower shall execute and deliver
to the Administrative Agent, for the account of the Issuing Lender and the L/C
Participants, such further documents and instruments as the Administrative Agent
may request to evidence the creation and perfection of such security interest in
such cash collateral account. Amounts held in such cash collateral account shall
be applied by the Administrative Agent to the payment of drafts drawn under such
Letter of Credit, and the unused portion thereof after all such Letters of
Credit shall have expired or been fully drawn upon, if any, shall be applied to
repay other obligations of the Borrowers hereunder and under any Notes. After
all such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied and all other obligations of
the Borrowers hereunder and under any Notes shall have been paid in full, the
balance, if any, in such cash collateral account shall be returned to the
Borrowers.
Except as expressly provided above in this Section, presentment,
demand, protest and all other notices of any kind are hereby expressly waived.
SECTION 10. THE ADMINISTRATIVE AGENT AND THE OTHER REPRESENTATIVES
10.1 Appointment. Each Lender hereby irrevocably designates and
appoints Chase as the Administrative Agent of such Lender under this Agreement
and the other Loan Documents, and each such Lender irrevocably authorizes Chase,
as the Administrative Agent for such Lender, to take such action on its behalf
under the provisions of this Agreement and the other Loan Documents and to
exercise such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent and the Other Representatives shall not have any duties or
responsibilities, except, in the case of the Administrative Agent and the Other
Representatives, those expressly set forth herein, or 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 the Administrative Agent or the Other
Representatives.
10.2 Delegation of Duties. The Administrative Agent may execute any
of its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact, and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact or counsel selected by it with reasonable care.
10.3 Exculpatory Provisions. None of the Administrative Agent or any
Other Representative nor any of their officers, directors, employees, agents,
attorneys-in-fact or affiliates shall be (i) liable for any action lawfully
taken or omitted to be taken by such Person under or in connection with this
Agreement or any other Loan Document (except for the gross negligence or willful
misconduct of such Person or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates) or (ii) responsible in any manner to any of the
Lenders for any recitals, statements,
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representations or warranties made by any Borrower or any other Loan Party or
any officer thereof contained in this Agreement or any other Loan Document or in
any certificate, report, statement or other document referred to or provided for
in, or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any Notes or any
other Loan Document or for any failure of any Borrower or any other Loan Party
to perform its obligations hereunder or thereunder. Neither the Administrative
Agent nor any Other Representative 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 properties, books or records of any Borrower or any
other Loan Party. Each Lender agrees that, except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder or given to the Administrative Agent for the
account of or with copies for the Lenders, the Administrative Agent and the
Other Representatives shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or creditworthiness of
any Borrower or any other Loan Party which may come into the possession of the
Administrative Agent and the Other Representatives or any of their officers,
directors, employees, agents, attorneys-in-fact or affiliates.
10.4 Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
Note, writing, resolution, notice, consent, certificate, affidavit, letter,
telecopy, telex or teletype message, statement, order 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, without limitation, counsel to the Borrowers),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified as between itself and the Lenders
in failing or refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders and/or such other requisite percentage of the Lenders as is
required pursuant to subsection 11.1 as it deems appropriate or it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and any
Notes and the other Loan Documents in accordance with a request of the Required
Lenders and/or such other requisite percentage of the Lenders as is required
pursuant to subsection 11.1, and such request and any action taken or failure to
act pursuant thereto shall be binding upon all the Lenders and all future
holders of the Loans.
10.5 Notice of Default. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
the Parent Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default". In the
event that the Administrative Agent receives such a notice, the Administrative
Agent shall give notice thereof to the Lenders. The Administrative Agent shall
take such action reasonably promptly with respect to such Default or Event of
Default as shall be directed by the Required Lenders and/or such other requisite
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percentage of the Lenders as is required pursuant to subsection 11.1; provided
that unless and until the Administrative Agent shall have received such
directions, the Administrative 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 in the best interests of the
Lenders.
10.6 Acknowledgments and Representations by Lenders. Each Lender
expressly acknowledges that none of the Administrative Agent or the Other
Representatives nor any of their officers, directors, employees, agents,
attorneys-in-fact or affiliates has made any representations or warranties to it
and that no act by the Administrative Agent or any Other Representative
hereafter taken, including any review of the affairs of any Borrower or any
other Loan Party, shall be deemed to constitute any representation or warranty
by the Administrative Agent or such Other Representative to any Lender. Each
Lender represents to the Administrative Agent, the Other Representatives and
each of the Loan Parties that, independently and without reliance upon the
Administrative Agent, the Other Representatives or any other Lender, and based
on such documents and information as it has deemed appropriate, it has made and
will make its own appraisal of and investigation into the business, operations,
property, financial and other condition and creditworthiness of each of the
Borrowers and the other Loan Parties, it has made its own decision to make its
Loans hereunder and enter into this Agreement and it will make its own decisions
in taking or not taking action under this Agreement and the other Loan
Documents. Each Lender represents to each other party hereto that it is a bank,
savings and loan association or other similar savings institution, insurance
company, investment fund or company or other financial institution which makes
or acquires commercial loans in the ordinary course of its business, that it is
participating hereunder as a Lender for its account and for such commercial
purposes, and that it has the knowledge and experience to be and is capable of
evaluating the merits and risks of being a Lender hereunder. Each Lender
acknowledges and agrees to comply with the provisions of subsection 11.6
applicable to the Lenders. Except for notices, reports and other documents
expressly required to be furnished to the Lenders by the Administrative Agent
hereunder or given to the Administrative Agent for the account of or with copies
for the Lenders, the Administrative Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Borrower or any other Loan
Party which may come into the possession of the Administrative Agent or any of
its officers, directors, employees, agents, attorneys-in-fact or affiliates.
10.7 Indemnification. The Lenders agree to indemnify the
Administrative Agent and the Other Representatives (provided that the Term Loan
Lenders shall have no obligation to indemnify the Issuing Lender) in their
capacities as such (to the extent not reimbursed by the Parent Borrower and
without limiting the obligation of the Parent Borrower or any of the other Loan
Parties to do so), ratably according to their respective Total Credit
Percentages in effect on the date on which indemnification is sought under this
subsection (or, if indemnification is sought after the date upon which the
Revolving Credit Commitments shall have terminated and the Loans shall have been
paid in full, ratably in accordance with their Total Credit Percentages
immediately prior to such date), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Loans)
be imposed on, incurred by or asserted against the Administrative Agent or any
Other Representative in any way relating to or arising out of this
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Agreement, any of the other Loan Documents or any documents contemplated by or
referred to herein or therein or the transactions contemplated hereby or thereby
or any action taken or omitted by the Administrative Agent or any Other
Representative under or in connection with any of the foregoing; provided that
no Lender shall be liable for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements to the extent resulting from the Administrative
Agent's or any Other Representative's gross negligence or willful misconduct.
The obligations to indemnify the Issuing Lender shall be ratable among the
Revolving Credit Lenders in accordance with their respective Revolving Credit
Commitments (or, if the Revolving Credit Commitments have been terminated, the
outstanding principal amount of their respective Revolving Credit Loans and L/C
Obligations and their respective participating interests in the outstanding
Letters of Credit). The agreements in this subsection shall survive the payment
of the Loans and all other amounts payable hereunder.
10.8 Administrative Agent and Other Representatives in Their
Respective Individual Capacities. The Administrative Agent, the Other
Representatives and their affiliates may make loans to, accept deposits from and
generally engage in any kind of business with any Borrower or any other Loan
Party as though the Administrative Agent and the Other Representatives were not
the Administrative Agent and the Other Representatives hereunder and under the
other Loan Documents. With respect to Loans made or renewed by them and any Note
issued to them and with respect to any Letter of Credit issued or participated
in by them, the Administrative Agent and the Other Representatives shall have
the same rights and powers under this Agreement and the other Loan Documents as
any Lender and may exercise the same as though they were not the Administrative
Agent or an Other Representative, and the terms "Lender" and "Lenders" shall
include the Administrative Agent in its individual capacity.
10.9 Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Lenders. If the
Administrative Agent shall resign as Administrative Agent under this Agreement
and the other Loan Documents, then the Required Lenders shall appoint from among
the Lenders a successor agent for the Lenders, which successor agent shall be
approved by the Parent Borrower (such approval not to be unreasonably withheld),
whereupon such successor agent shall succeed to the rights, powers and duties of
the Administrative Agent, and the term "Administrative Agent" shall mean such
successor agent effective upon such appointment and approval, and the former
Administrative Agent's rights, powers and duties as Administrative Agent shall
be terminated, without any other or further act or deed on the part of such
former Administrative Agent or any of the parties to this Agreement or any
holders of the Loans. After any retiring Administrative Agent's resignation as
Administrative Agent, the provisions of this subsection shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement and the other Loan Documents.
10.10 Swing Line Lender. The provisions of this Section 10 shall
apply to the Swing Line Lender in its capacity as such to the same extent that
such provisions apply to the Administrative Agent.
10.11 Release of Liens in Connection with Permitted Receivables
Securitization. In connection with a Permitted Receivables Securitization, the
Parent Borrower may deliver to the Administrative Agent a written request for
release identifying the relevant Receivables and the terms of such Permitted
Receivables Securitization in reasonable detail together with a certification by
the Parent
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Borrower stating that such transaction is in compliance with this Agreement. The
Administrative Agent shall execute and deliver to the Parent Borrower (at the
sole cost and expense of the Parent Borrower) all releases and other documents
(including, without limitation, Uniform Commercial Code termination statements)
necessary or reasonably desirable for the release of the Liens created by the
Guarantee and Collateral Agreement on such Receivables as the Parent Borrower
may reasonably request, provided that the Loans have been prepaid and/or the
Revolving Credit Commitments shall have been reduced in accordance with
subsection 4.4. Each of the Lenders hereby authorizes the Administrative Agent
to deliver such releases or other documents.
SECTION 11. MISCELLANEOUS
11.1 Amendments and Waivers. (a) Neither this Agreement nor any
other Loan Document, nor any terms hereof or thereof, may be amended,
supplemented or modified except in accordance with the provisions of this
subsection. The Required Lenders may, or, with the written consent of the
Required Lenders, the Administrative Agent may, from time to time, (1) enter
into with the Borrowers and the other Loan Parties, as the case may be, written
amendments, supplements or modifications hereto and to the other Loan Documents
for the purpose of adding any provisions to this Agreement or the other Loan
Documents or changing in any manner the rights or obligations of the Lenders or
of the Borrowers and the other Loan Parties, as the case may be, hereunder or
thereunder or (2) waive at the Parent Borrower's or another Loan Party's
request, on such terms and conditions as the Required Lenders or the
Administrative Agent, as the case may be, may specify in such instrument, any of
the requirements of this Agreement or the other Loan Documents or any Default or
Event of Default and its consequences; provided, however, that no such waiver
and no such amendment, supplement or modification shall:
(i) reduce the amount or extend the scheduled date of maturity
of any Loan or any Reimbursement Obligation or of any scheduled
installment thereof, or reduce the stated rate of any interest or fee
payable hereunder or extend the scheduled date of any payment thereof or
increase the amount or extend the expiration date of any Lender's
Revolving Credit Commitment or change the currency in which any Loan or
Reimbursement Obligation is payable, in each case without the consent of
each Lender directly affected thereby,
(ii) amend, modify or waive any provision of this subsection
11.1 or reduce the percentage specified in the definition of Required
Lenders or of Required Release Lenders, or consent to the assignment or
transfer by any Loan Party of any of its rights and obligations under this
Agreement and the other Loan Documents (other than pursuant to subsection
8.5 or 11.1(b)), in each case without the written consent of all the
Lenders,
(iii) release any Guarantee or, in the aggregate, a material
portion of the Collateral without the consent of the Required Release
Lenders, except as expressly permitted hereby or by any Guarantee or
Security Document (as such documents are in effect on the date hereof or,
if later, the date of execution and delivery thereof in accordance with
the terms hereof),
(iv) amend, modify or waive any provision of (x) subsection
2.6 (to the extent such subsection 2.6 relates to the Tranche A Term
Loans) or 2.7 without the written consent of
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Tranche A Term Loan Lenders, the Tranche A Term Loan Percentages of which
aggregate at least 51% or (y) subsection 2.6 (to the extent such
subsection 2.6 relates to the Tranche B Term Loans) or 2.8 without the
written consent of Tranche B Term Loan Lenders the Tranche B Term Loan
Percentages of which aggregate at least 51%,
(v) amend, modify or waive any provision of subsection 2.1,
2.2, 2.3, 2.4 or 2.5 or Section 3 without the written consent of the
Revolving Credit Lenders, the Revolving Credit Commitment Percentages of
which aggregate at least 51%,
(vi) amend, modify or waive any provision of Section 10
without the written consent of the then Administrative Agent and of any
Other Representative affected thereby,
(vii) amend, modify or waive any prepayment required by
subsection 4.4(c) or 4.4(d), or the order of application of prepayments
specified in subsection 4.4(f), without the consent of (x) Revolving
Credit Lenders, the Revolving Credit Commitment Percentages of which
aggregate at least 51%, (y) Tranche A Term Loan Lenders, the Tranche A
Term Loan Percentages of which aggregate at least 51% and (z) Tranche B
Term Loan Lenders, the Tranche B Term Loan Percentages of which aggregate
at least 51%,
(viii) amend, modify or waive any provision of subsection
4.4(g) without the consent of Tranche B Term Loan Lenders, the Tranche B
Term Loan Percentages of which aggregate at least 51%,
(ix) amend, modify or waive any provision of the Swing Line
Note (if any) or subsection 2.5 without the written consent of the Swing
Line Lender and each other Lender, if any, which holds a participation in
the Swing Line Loan pursuant to subsection 2.5(d),
(x) amend, modify or waive the provisions of any Letter of
Credit or any L/C Obligation without the written consent of the Issuing
Lender and each affected L/C Participant,
(xi) amend, modify or waive any provision of any Security
Document that provides for the ratable sharing by the Lenders of the
proceeds of any realization on the Collateral to provide for a non-ratable
sharing thereof, without the consent of (x) Revolving Credit Lenders the
Revolving Credit Commitment Percentages of which aggregate at least 51%,
(y) Tranche A Term Loan Lenders the Tranche A Term Loan Percentages of
which aggregate at least 51% and (z) Tranche B Term Loan Lenders the
Tranche B Term Loan Percentages of which aggregate at least 51%, or
(xii) require any Lender to make Loans having an Interest
Period of longer than six months without the consent of such Lender.
Any waiver and any amendment, supplement or modification pursuant to this
subsection 11.1 shall apply to each of the Lenders and shall be binding upon the
Borrowers, the other Loan Parties, the Lenders, the Administrative Agent and all
future holders of the Loans. In the case of any waiver, the Borrowers, the other
Loan Parties, the Lenders and the Administrative Agent shall be restored to
their former position and rights hereunder and under the other Loan Documents,
and any Default or Event of
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Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
(b) Schedule III and Schedule IV may be amended, so long as no
Default or Event of Default shall have occurred and be continuing, as follows:
(i) Schedule IV will be amended to add Subsidiaries as
additional Foreign Subsidiary Borrowers upon (A) execution and delivery by
the Parent Borrower, such additional Foreign Subsidiary Borrowers and the
Administrative Agent, of a Joinder Agreement, substantially in the form of
Exhibit K (a "Joinder Agreement"), providing for such Subsidiaries to
become Foreign Subsidiary Borrowers hereunder and Granting Parties,
Grantors and Pledgors under and as defined in the Guarantee and Collateral
Agreement (or shall otherwise enter into collateral and security documents
reasonably satisfactory to the Administrative Agent and providing, to the
extent reasonably practicable under relevant law, substantially the
equivalent of the lien and security interests contemplated to be provided
by Granting Parties, Grantors and Pledgors under the Guarantee and
Collateral Agreement), (B) delivery to the Administrative Agent of (w) in
the case of any Foreign Subsidiary Borrower the Capital Stock of which is
held by a Domestic Subsidiary, a stock pledge agreement (or, if the parent
corporation of such Foreign Subsidiary Borrower is a party to the
Guarantee and Collateral Agreement, a pledge pursuant to such agreement)
covering the Capital Stock of such Foreign Subsidiary Borrower, together
with any documents and instruments necessary to perfect the security
interest to be created thereby (which pledge shall not apply to more than
65% of such parent corporation's ownership interest in any such Foreign
Subsidiary Borrower), (x) corporate resolutions, other corporate
documents, certificates and legal opinions in respect of such additional
Foreign Subsidiary Borrowers substantially equivalent to comparable
documents delivered on the Effective Date in respect of the Foreign
Subsidiary Borrowers party to this Agreement on the Effective Date or, if
there are no Foreign Subsidiary Borrowers party to this Agreement on the
Effective Date, in respect of the Loan Parties on the Effective Date, (y)
a certificate of a Responsible Officer of the Parent Borrower stating that
such Subsidiaries are "Restricted Subsidiaries" for all purposes of each
of the Indentures and (z) such other documents with respect thereto as the
Administrative Agent shall reasonably request, and (C) execution and
delivery by the Parent Borrower, such Foreign Subsidiary Borrower, all of
the Revolving Credit Lenders and the Administrative Agent of a written
instrument providing for such amendment; provided that the Parent Borrower
and its Subsidiaries shall not be required to comply with the requirements
of the foregoing clauses (w), (x), (y) or (z) if the Administrative Agent,
in its sole discretion, determines that the cost of such compliance is
excessive in relation to the value of the collateral security to be
afforded thereby; provided, further, that no document described in the
foregoing clauses (w), (x), (y) or (z) shall be required, or the form of
such document shall be modified, to the extent required to avoid (A) any
violation of applicable law or (B) any violation of the provisions of any
joint venture or other material agreement governing or binding such
Domestic Subsidiary or other Subsidiary. Any Domestic Subsidiary or other
Subsidiary that cannot execute such a document or whose document must be
amended for the foregoing reasons shall promptly upon any change of law or
waiver or lapse of the applicable contractual restriction enter into such
document or amend the existing document to comply with this subsection
11.1(b)(i) in a manner satisfactory to the Administrative Agent.
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(ii) Schedule IV will be amended to remove any Subsidiary as a
Foreign Subsidiary Borrower upon execution and delivery by the Parent
Borrower to the Administrative Agent of a written notification to such
effect and repayment in full of all Loans made to such Foreign Subsidiary
Borrower, cash collateralization of all L/C Obligations in respect of
Letters of Credit issued for the account of such Foreign Subsidiary
Borrower and repayment in full of all other amounts owing by such Foreign
Subsidiary Borrower under this Agreement and the other Loan Documents.
(iii) Schedule III will be amended to add additional
Designated Foreign Currencies upon execution and delivery by the Parent
Borrower, all of the Revolving Credit Lenders and the Administrative Agent
of a written instrument providing for such amendment.
(c) In order to permit the Borrowers to enter into a replacement
working capital facility as contemplated by subsection 8.2(h), on or after the
Termination Date the Administrative Agent and the Loan Parties shall execute
such documents, including, without limitation, such amendments to the Security
Documents and the other Loan Documents, and take such other actions, as shall be
necessary to afford the lenders under such replacement working capital facility
the substantive realization of the benefits intended to be created by such
documents in favor of the Revolving Credit Lenders. Each of the Lenders hereby
authorizes the Administrative Agent to execute such documents and take such
actions as are required by this subsection 11.1(c).
11.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered by hand, or three days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, or, in the case of delivery by a nationally recognized overnight
courier, when received, addressed as follows in the case of the Borrowers and
the Administrative Agent, and as set forth in Schedule I in the case of the
other parties hereto, or to such other address as may be hereafter notified by
the respective parties hereto and any future holders of the Loans:
The Borrowers: c/o North American Van Lines, Inc.
5001 U.S. Highway 30 West
P.O. Box 988
Fort Wayne, Indiana 46801-0988
Attention: General Counsel
Telecopy: (219) 429-3135
Telephone: (219) 429-2511
with a copy to: Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Attention: William Beekman, Esq.
Telecopy: (212) 909-6836
Telephone: (212) 909-6000
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The Administrative The Chase Manhattan Bank
Agent, the Swing 270 Park Avenue
Line Lender and New York, New York 10017
the Issuing Lender Attention: Richard W. Duker
Telecopy: (212) 972-9854
Telephone: (212) 270-3057
with a copy to: The Chase Manhattan Bank
c/o The Loan & Agency Services Group
One Chase Manhattan Plaza
8th Floor
New York, New York 10081
Attention: Janet Belden
Telecopy: (212) 552-5658
Telephone: (212) 552-7277
and, if to the Issuing Chase Manhattan Bank Delaware
Lender, with an Corporate Banking Department
additional copy to: 8th Floor
1201 Market Street
Wilmington, Delaware 19801
Attention: Michael Handago
Telecopy: (302) 428-3390
Telephone: (302) 428-3311
provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders pursuant to subsection 2.3, 2.9, 3.2, 4.2, 4.4 or 4.8 shall not
be effective until received.
11.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent, any Lender or any
Loan Party, any right, remedy, power or privilege hereunder or under the other
Loan Documents shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights, remedies, powers and privileges herein provided
are cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
11.4 Survival of Representations and Warranties. All representations
and warranties made hereunder and in the other Loan Documents (or in any
amendment, modification or supplement hereto or thereto) and in any certificate
delivered pursuant hereto or such other Loan Documents shall survive the
execution and delivery of this Agreement and the making of the Loans hereunder.
11.5 Payment of Expenses and Taxes. The Parent Borrower agrees (a)
to pay or reimburse the Administrative Agent and the Other Representatives for
all their reasonable out-of-pocket costs and expenses incurred in connection
with the preparation, execution and delivery of, and any amendment, supplement,
waiver or modification to, this Agreement and the other Loan Documents and any
other
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documents prepared in connection herewith or therewith, and the consummation and
administration of the transactions (including the syndication of the Revolving
Credit Commitments and Term Loans, the Administrative Agent's due diligence
investigation and any collateral audit) contemplated hereby and thereby,
including, without limitation, the reasonable fees and disbursements of one firm
of counsel and of local counsel to the Administrative Agent and the Other
Representatives, (b) to pay or reimburse each Lender, each Other Representative
and the Administrative Agent for all its respective reasonable costs and
expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the other Loan Documents and any such other
documents, including, without limitation, the reasonable fees and disbursements
of one firm of counsel and of local counsel to the Administrative Agent, the
Other Representatives and the several Lenders, and any reasonable Environmental
Costs arising out of or in any way relating to any Loan Party or any property in
which any Loan Party has had any interest at any time, (c) to pay, and indemnify
and hold harmless each Lender, the Administrative Agent and the Other
Representatives from and against, any and all recording and filing fees and any
and all liabilities with respect to, or resulting from any delay in paying,
stamp, excise and other similar taxes, if any, which may be payable or
determined to be payable in connection with the execution and delivery of, or
consummation or administration of any of the transactions contemplated by, or
any amendment, supplement or modification of, or any waiver or consent under or
in respect of, this Agreement, the other Loan Documents and any such other
documents, and (d) to pay, and indemnify and hold harmless each Lender, the
Administrative Agent and the Other Representatives (and their respective
directors, trustees, officers, employees, agents, successors and assigns) from
and against, any and all other liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever (whether or not caused by any such Person's own
negligence (other than gross negligence) and including, without limitation, the
reasonable fees and disbursements of counsel) with respect to the execution,
delivery, enforcement, performance and administration of this Agreement, the
other Loan Documents and any such other documents (regardless of whether the
Administrative Agent, any such Other Representative or any Lender is a party to
the litigation or other proceeding giving rise thereto), including, without
limitation, any of the foregoing relating to the use of proceeds of the Loans or
the violation of, noncompliance with, or liability under, any Environmental Laws
or any orders, requirements or demands of Governmental Authorities related
thereto applicable to the operations of the Parent Borrower, any of its
Subsidiaries or any of the Properties (all the foregoing in this clause (d),
collectively, the "Indemnified Liabilities"), provided that the Parent Borrower
shall not have any obligation hereunder to the Administrative Agent, any such
Other Representative or any Lender with respect to Environmental Costs or
Indemnified Liabilities arising from (i) the gross negligence or willful
misconduct of the Administrative Agent, any Other Representative or any such
Lender (or any of their respective directors, officers, employees, agents,
successors and assigns) or (ii) legal proceedings commenced against the
Administrative Agent, any Other Representative or any such Lender by any
securityholder or creditor thereof arising out of and based upon rights afforded
any such securityholder or creditor solely in its capacity as such.
Notwithstanding the foregoing, except as provided in clauses (b) and (c) above,
the Parent Borrower shall have no obligation under this subsection 11.5 to the
Administrative Agent, any Other Representative or any Lender with respect to any
tax, levy, impost, duty, charge, fee, deduction or withholding imposed, levied,
collected, withheld or assessed by any Governmental Authority. The agreements in
this subsection shall survive repayment of the Loans and all other amounts
payable hereunder.
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11.6 Successors and Assigns; Participations and Assignments. (a)
This Agreement shall be binding upon and inure to the benefit of the Borrowers
party hereto, the Lenders, the Administrative Agent, the Other Representatives,
all future holders of the Loans and their respective successors and assigns,
except that none of the Borrowers may, other than in accordance with subsection
8.5 or 11.1(b), assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of each Lender.
(b) Any Lender may, in accordance with applicable law, at any time
sell to one or more banks or other entities ("Participants") participating
interests in any Loan owing to such Lender, any Note held by such Lender, any
Revolving Credit Commitment of such Lender or any other interest of such Lender
hereunder and under the other Loan Documents; provided that (unless the Parent
Borrower and the Administrative Agent otherwise consent in writing) no such
participating interests shall be in an aggregate principal amount of less than
(i) in the case of Tranche A Term Loans and Revolving Credit Commitments,
$5,000,000 in the aggregate (or, if less, the full amount of such selling
Lender's Revolving Credit Loans, Tranche A Term Loans and Revolving Credit
Commitments) or (ii) in the case of Tranche B Term Loans, $5,000,000 (or, if
less, the full amount of such selling Lender's Tranche B Term Loans). Such sale
of participating interests need not be ratable as among the Tranche A Term
Loans, the Revolving Credit Commitments and the Tranche B Term Loans of such
Lender. In the event of any such sale by a Lender of a participating interest to
a Participant, such Lender's obligations under this Agreement to the other
parties to this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain the
holder of any such Loan (and any Note evidencing such Loan) for all purposes
under this Agreement and the other Loan Documents and the Borrowers and the
Administrative Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents, and such Lender shall be solely responsible for any
withholding taxes or any filing or reporting requirements relating to such
Participant. Any agreement pursuant to which any Lender shall sell any such
participating interest shall provide that such Lender shall retain the sole
right and responsibility to exercise such Lender's rights and enforce each of
the Borrowers' obligations hereunder, including the right to consent to any
amendment, supplement, modification or waiver of any provision of this Agreement
or any of the other Loan Documents, provided that such participation agreement
may provide that such Lender will not agree to any amendment, supplement,
modification or waiver described in clause (i) or (ii) of the proviso to the
second sentence of subsection 11.1(a) without the consent of the Participant.
Each of the Borrowers agrees that each Lender shall be entitled to the benefits
of subsections 4.9, 4.10, 4.11, 4.12, 11.1 and 11.5 without regard to whether it
has granted any participating interests, and that all amounts payable to a
Lender under subsections 4.9, 4.10, 4.11, 4.12 and 11.5 shall be determined as
if such Lender had not granted any such participating interests.
(c) Any Lender may, in accordance with applicable law, at any time
and from time to time assign to any Lender or any affiliate thereof or to any
Approved Fund or, with the prior written consent of the Administrative Agent and
the Parent Borrower (which in each case shall not be unreasonably withheld), to
an additional bank, savings and loan association or other similar savings
institution, insurance company, investment fund or company or other financial
institution (an "Assignee") all or any part of its rights and obligations under
this Agreement and any Notes, including, without limitation, its Revolving
Credit Commitments and Loans, pursuant to an Assignment and Acceptance,
substantially in
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the form of Exhibit H (an "Assignment and Acceptance"), executed by such
Assignee, such assigning Lender (and, in the case of an Assignee that is not
then a Lender or an affiliate thereof or an Approved Fund, by the Parent
Borrower and the Administrative Agent) and delivered to the Administrative Agent
for its acceptance and recording in the Register; provided that (i) (unless the
Administrative Agent and the Parent Borrower otherwise consent in writing (such
consent not to be unreasonably withheld)) no such transfer to an Assignee (other
than a Lender or any affiliate thereof or any Approved Fund) shall be in an
aggregate principal amount less than (x) in the case of Tranche A Term Loans and
Revolving Credit Commitments, $5,000,000 in the aggregate (or, if less, the full
amount of such assigning Lender's Tranche A Term Loans, Revolving Credit Loans
and Revolving Credit Commitments) or (y) in the case of Tranche B Term Loans,
$5,000,000 (or, if less, the full amount of such assigning Lender's Tranche B
Term Loans) and (ii) if any Lender assigns all or any part of its rights and
obligations under this Agreement to one of its affiliates in connection with or
in contemplation of the sale or other disposition of its interest in such
affiliate, the Parent Borrower's prior written consent shall be required for
such assignment. Any such assignment shall be ratable as between the Tranche A
Term Loans and the Revolving Credit Commitments of such Lender unless the
Administrative Agent and the Parent Borrower otherwise consent in writing, but
need not be ratable as between the Tranche A Term Loans and the Revolving Credit
Commitments of such Lender, on the one hand, and the Tranche B Term Loans of
such Lender, on the other hand. Upon such execution, delivery, acceptance and
recording, from and after the effective date determined pursuant to such
Assignment and Acceptance, (x) the Assignee thereunder shall be a party hereto
and, to the extent provided in such Assignment and Acceptance, have the rights
and obligations of a Lender hereunder with a Revolving Credit Commitment,
Tranche A Term Loan and Tranche B Term Loan as set forth therein, and (y) the
assigning Lender thereunder shall be released from its obligations under this
Agreement to the extent that such obligations shall have been expressly assumed
by the Assignee pursuant to such Assignment and Acceptance (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, such assigning
Lender shall cease to be a party hereto but shall nevertheless continue to be
entitled to the benefits of subsections 4.10, 4.11, 4.12 and 11.5).
Notwithstanding the foregoing, no Assignee, which as of the date of any
assignment to it pursuant to this subsection 11.6(c) would be entitled to
receive any greater payment under subsection 4.10 or 4.11 than the assigning
Lender would have been entitled to receive as of such date under such
subsections with respect to the rights assigned, shall be entitled to receive
such payments unless the Parent Borrower has consented in writing to the
assignment.
(d) The Administrative Agent, on behalf of each of the Borrowers,
shall maintain at its address referred to in subsection 11.2 a copy of each
Assignment and Acceptance delivered to it and a register (the "Register") for
the recordation of the names and addresses of the Lenders and the Revolving
Credit Commitment of, and the principal amount of the Loans owing to, and the
Notes evidencing such Loans owed by, each Lender from time to time.
Notwithstanding anything in this Agreement to the contrary, the Borrowers, the
Administrative Agent and the Lenders shall treat each Person whose name is
recorded in the Register as the owner of the Loan, the Notes and the Revolving
Credit Commitments recorded therein for all purposes of this Agreement. The
Register shall be available for inspection by the Parent Borrower or any Lender
at any reasonable time and from time to time upon reasonable prior notice.
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(e) Notwithstanding anything in this Agreement to the contrary, no
assignment under subsection 11.6(c) of any rights or obligations under or in
respect of the Loans or the Notes evidencing such Loans shall be effective
unless and until the Administrative Agent shall have recorded the assignment
pursuant to subsection 11.6(d). Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an Assignee (and, in the case of an Assignee
that is not then a Lender or an affiliate thereof, by the Administrative Agent
and the Parent Borrower), together with payment to the Administrative Agent of a
registration and processing fee of $3,500 (which fee need not be paid in the
case of any assignment to an affiliate of the assigning Lender or to an Approved
Fund; and provided that in the case of contemporaneous assignments by a Lender
to more than one fund managed by the same investment advisor (which funds are
not then Lenders hereunder, affiliates thereof or Approved Funds), only a single
fee of $3,500 shall be payable for all such contemporaneous assignments), the
Administrative Agent shall (i) promptly accept such Assignment and Acceptance
and (ii) on the effective date determined pursuant thereto record the
information contained therein in the Register and give prompt notice of such
acceptance and recordation to the Lenders and the Parent Borrower. On or prior
to such effective date, the assigning Lender shall surrender any outstanding
Notes held by it all or a portion of which are being assigned, and the Parent
Borrower, at its own expense, shall, upon the request to the Administrative
Agent by the assigning Lender or the Assignee, as applicable, execute and
deliver (and cause the applicable Foreign Subsidiary Borrowers to execute and
deliver) to the Administrative Agent (in exchange for the outstanding Notes of
the assigning Lender) a new Revolving Credit Note, Tranche A Term Note, Tranche
B Term Note and/or Swing Line Note, as the case may be, to the order of such
Assignee in an amount equal to (i) in the case of a Revolving Credit Note, the
lesser of (A) the amount of such Assignee's Revolving Credit Commitment and (B)
the aggregate principal amount of all Revolving Credit Loans made by such
Assignee, (ii) in the case of a Tranche A Term Note, the amount of such
Assignee's Tranche A Term Loan, (iii) in the case of a Tranche B Term Note, the
amount of such Assignee's Tranche B Term Loan and (iv) in the case of a Swing
Line Note, the lesser of (A) the Swing Line Commitment and (B) the aggregate
principal amount of all Swing Line Loans made by such Assignee, in each case
with respect to the relevant Loan, Swing Line Commitment, or Revolving Credit
Commitment after giving effect to such Assignment and Acceptance and, if the
assigning Lender has retained a Swing Line Commitment, Revolving Credit
Commitment or Term Loan hereunder, a new Revolving Credit Note, Tranche A Term
Note, Tranche B Term Note and/or Swing Line Note, as the case may be, to the
order of the assigning Lender in an amount equal to (i) in the case of a
Revolving Credit Note, the lesser of (A) the amount of such Lender's Revolving
Credit Commitment and (B) the aggregate principal amount of all Revolving Credit
Loans made by such Lender, (ii) in the case of a Tranche A Term Note, the amount
of such Lender's Tranche A Term Loan, (iii) in the case of a Tranche B Term
Note, the amount of such Lender's Tranche B Term Loan and (iv) in the case of a
Swing Line Note, the lesser of (A) the Swing Line Commitment and (B) the
aggregate principal amount of all Swing Line Loans made by such Lender, in each
case with respect to the relevant Loan, Swing Line Commitment or Revolving
Credit Commitment after giving effect to such Assignment and Acceptance. Any
such new Notes shall be dated the Effective Date and shall otherwise be in the
form of the Note replaced thereby. Any Notes surrendered by the assigning Lender
shall be returned by the Administrative Agent to the Parent Borrower marked
"cancelled".
(f) Each Borrower authorizes each Lender to disclose to any
Participant or Assignee (each, a "Transferee") and any prospective Transferee,
subject to the provisions of subsection 11.16, any and all information in such
Lender's possession concerning any Borrower and its Affiliates which has been
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delivered to such Lender by or on behalf of any Borrower pursuant to this
Agreement or which has been delivered to such Lender by or on behalf of any
Borrower in connection with such Lender's credit evaluation of each Borrower and
its Affiliates prior to becoming a party to this Agreement. No assignment or
participation made or purported to be made to any Transferee shall be effective
without the prior written consent of the Parent Borrower if it would require the
Parent Borrower to make any filing with any Governmental Authority or qualify
any Loan or Note under the laws of any jurisdiction, and the Parent Borrower
shall be entitled to request and receive such information and assurances as it
may reasonably request from any Lender or any Transferee to determine whether
any such filing or qualification is required or whether any assignment or
participation is otherwise in accordance with applicable law.
(g) For avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this subsection 11.6 concerning assignments
of Loans and Notes relate only to absolute assignments and that such provisions
do not prohibit assignments creating security interests, including, without
limitation, any pledge or assignment by a Lender of any Loan or Note to any
Federal Reserve Bank in accordance with applicable law, provided that any
foreclosure or similar action shall be subject to the provisions of this
subsection concerning assignments and shall be void and of no force or effect
unless effected in compliance with such provisions.
11.7 Adjustments; Set-off. (a) If any Lender (a "Benefitted Lender")
shall at any time receive any payment of all or part of its Revolving Credit
Loans, Term Loans or the Reimbursement Obligations owing to it, or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of the nature
referred to in Section 9(f), or otherwise (except pursuant to subsection 4.4,
4.13(d) or 11.6)), in a greater proportion than any such payment to or
collateral received by any other Lender, if any, in respect of such other
Lender's Revolving Credit Loans, Term Loans or the Reimbursement Obligations, as
the case may be, owing to it, or interest thereon, such Benefitted Lender shall
purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender's Revolving Credit Loans, Term Loans or the
Reimbursement Obligations, as the case may be, owing to it, or shall provide
such other Lenders with the benefits of any such collateral, or the proceeds
thereof, as shall be necessary to cause such Benefitted Lender to share the
excess payment or benefits of such collateral or proceeds ratably with each of
the Lenders; provided, however, that if all or any portion of such excess
payment or benefits is thereafter recovered from such Benefitted Lender, such
purchase shall be rescinded, and the purchase price and benefits returned, to
the extent of such recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders provided
by law, each Lender shall have the right, without prior notice to any Borrower,
any such notice being expressly waived by each Borrower to the extent permitted
by applicable law, upon the occurrence of an Event of Default under Section 9(a)
to set-off and appropriate and apply against any amount then due and payable
under Section 9(a) by such Borrower any and all deposits (general or special,
time or demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Lender or any affiliate, branch or agency thereof to or for the
credit or the account of such Borrower. Each Lender agrees promptly to notify
the Parent Borrower and the Administrative Agent
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after any such set-off and application made by such Lender, provided that the
failure to give such notice shall not affect the validity of such set-off and
application.
11.8 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts (including
by telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Agreement
signed by all the parties shall be delivered to the Parent Borrower and the
Administrative Agent.
11.9 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
11.10 Integration. This Agreement and the other Loan Documents
represent the entire agreement of the Borrowers party hereto, the other Loan
Parties, the Administrative Agent and the Lenders with respect to the subject
matter hereof, and there are no promises, undertakings, representations or
warranties by any of the Borrowers party hereto, the other Loan Parties, the
Administrative Agent or any Lender relative to the subject matter hereof not
expressly set forth or referred to herein or in the other Loan Documents.
11.11 GOVERNING LAW. THIS AGREEMENT AND ANY NOTES AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND ANY NOTES SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.
11.12 Submission To Jurisdiction; Waivers. (a) Each party hereto
hereby irrevocably and unconditionally:
(i) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to
which it is a party, or for recognition and enforcement of any judgment in
respect thereof, to the non-exclusive general jurisdiction of the courts
of the State of New York, the courts of the United States of America for
the Southern District of New York, and appellate courts from any thereof;
(ii) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient forum and agrees not
to plead or claim the same;
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to the applicable Borrower (or, in the case of any Foreign
Subsidiary Borrower, as specified in paragraph (b)), the applicable Lender
or the Administrative Agent, as the case may be, at
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the address specified in subsection 11.2 or at such other address of which
the Administrative Agent, any such Lender and any such Borrower shall have
been notified pursuant thereto;
(iv) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction; and
(v) waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or proceeding referred
to in this subsection any punitive damages.
(b) Upon any Foreign Subsidiary becoming a Foreign Subsidiary
Borrower in accordance with subsection 11.1(b), such Foreign Subsidiary Borrower
hereby agrees to irrevocably and unconditionally appoint an agent for service of
process located in The City of New York (the "New York Process Agent"),
reasonably satisfactory to the Administrative Agent, as its agent to receive on
behalf of such Foreign Subsidiary Borrower and its property service of copies of
the summons and complaint and any other process which may be served in any
action or proceeding in any such New York State or Federal court described in
paragraph (a) of this subsection and agrees promptly to appoint a successor New
York Process Agent in The City of New York (which successor New York Process
Agent shall accept such appointment in a writing reasonably satisfactory to the
Administrative Agent) prior to the termination for any reason of the appointment
of the initial New York Process Agent. In any such action or proceeding in such
New York State or Federal court, such service may be made on such Foreign
Subsidiary Borrower by delivering a copy of such process to such Foreign
Subsidiary Borrower in care of the New York Process Agent at the New York
Process Agent's address and by depositing a copy of such process in the mails by
certified or registered air mail, addressed to such Foreign Subsidiary Borrower
at its address specified in subsection 11.2 with (if applicable) a copy to the
Parent Borrower (such service to be effective upon such receipt by the New York
Process Agent and the depositing of such process in the mails as aforesaid).
Each of the Foreign Subsidiary Borrowers hereby irrevocably and unconditionally
authorizes and directs the New York Process Agent to accept such service on its
behalf. As an alternate method of service, each of the Foreign Subsidiary
Borrowers irrevocably and unconditionally consents to the service of any and all
process in any such action or proceeding in such New York State or Federal court
by mailing of copies of such process to such Foreign Subsidiary Borrower by
certified or registered air mail at its address specified in subsection 11.2.
Each of the Foreign Subsidiary Borrowers agrees that, to the fullest extent
permitted by applicable law, a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.
(c) To the extent that any Foreign Subsidiary Borrower has or
hereafter may acquire any immunity (sovereign or otherwise) from any legal
action, suit or proceeding, from jurisdiction of any court or from set-off or
any legal process (whether service or notice, attachment prior to judgment,
attachment in aid of execution of judgment, execution of judgment or otherwise)
with respect to itself or any of its property, such Foreign Subsidiary Borrower
hereby irrevocably waives and agrees not to plead or claim such immunity in
respect of its obligations under this Agreement and any Note.
11.13 Judgment. (a) If for the purpose of obtaining judgment in any
court it is necessary to convert a sum due hereunder in one currency into
another currency, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which in
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accordance with normal banking procedures the Administrative Agent could
purchase the first currency with such other currency on the Business Day
preceding the day on which final judgment is given.
(b) The obligations of any Borrower in respect of this Agreement and
any Note due to any party hereto or any holder of any bond shall,
notwithstanding any judgment in a currency (the "judgment currency") other than
the currency in which the sum originally due to such party or such holder is
denominated (the "original currency"), be discharged only to the extent that on
the Business Day following receipt by such party or such holder (as the case may
be) of any sum adjudged to be so due in the judgment currency such party or such
holder (as the case may be) may in accordance with normal banking procedures
purchase the original currency with the judgment currency; if the amount of the
original currency so purchased is less than the sum originally due to such party
or such holder (as the case may be) in the original currency, such Borrower
agrees, as a separate obligation and notwithstanding any such judgment, to
indemnify such party or such holder (as the case may be) against such loss, and
if the amount of the original currency so purchased exceeds the sum originally
due to any party to this Agreement or any holder of Notes (as the case may be),
such party or such holder (as the case may be), agrees to remit to such
Borrower, such excess. This covenant shall survive the termination of this
Agreement and payment of the Loans and all other amounts payable hereunder.
11.14 Acknowledgments. Each Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) neither the Administrative Agent nor any Other Representative or
Lender has any fiduciary relationship with or duty to any Borrower arising
out of or in connection with this Agreement or any of the other Loan
Documents, and the relationship between the Administrative Agent and
Lenders, on the one hand, and the Borrowers, on the other hand, in
connection herewith or therewith is solely that of creditor and debtor;
and
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions contemplated
hereby and thereby among the Lenders or among any of the Borrowers and the
Lenders.
11.15 WAIVER OF JURY TRIAL. EACH OF THE BORROWERS, THE
ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT
OR ANY NOTES OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
11.16 Confidentiality. The Administrative Agent and each Lender
agrees to keep confidential any written or oral information (a) provided to it
by or on behalf of Holding, the Parent Borrower or any of their Subsidiaries
pursuant to or in connection with this Agreement or (b) obtained by such Lender
based on a review of the books and records of Holding, the Parent Borrower or
any of their Subsidiaries; provided that nothing herein shall prevent any Lender
from disclosing any such information (i) to the Administrative Agent or any
other Lender, (ii) to any Transferee or prospective
<PAGE>
124
Transferee which agrees to comply with the provisions of this subsection, (iii)
to its Affiliates, its Subsidiaries and the employees, directors, agents,
attorneys, accountants and other professional advisors of it, its Affiliates and
its Subsidiaries, provided that such Lender shall inform each such Person of the
agreement under this subsection 11.16 and take reasonable actions to cause
compliance by any such Person referred to in this clause (iii) with this
agreement (including, where appropriate, to cause any such Person to acknowledge
its agreement to be bound by the agreement under this subsection 11.16), (iv)
upon the request or demand of any Governmental Authority having jurisdiction
over such Lender or to the extent required in response to any order of any court
or other Governmental Authority or as shall otherwise be required pursuant to
any Requirement of Law, provided that such Lender shall, unless prohibited by
any Requirement of Law, notify the Parent Borrower of any disclosure pursuant to
this clause (iv) as far in advance as is reasonably practicable under such
circumstances, (v) which has been publicly disclosed other than in breach of
this Agreement, (vi) in connection with the exercise of any remedy hereunder,
(vii) in connection with periodic regulatory examinations, (viii) in connection
with any litigation to which such Lender may be a party, subject to the proviso
in clause (iv), (ix) to any direct or indirect contractual counterparty in swap
agreements or such contractual counterparty's professional advisor (so long as
such contractual counterparty or professional advisor to such contractual
counterparty (A) has been approved in writing by the Parent Borrower and (B)
agrees in a writing enforceable by the Parent Borrower to be bound by the
provisions of this subsection 11.16) and (x) if, prior to such information
having been so provided or obtained, such information was already in the
Administrative Agent's or a Lender's possession on a nonconfidential basis
without a duty of confidentiality to any Borrower being violated.
11.17 Amendment and Restatement. This Agreement represents an
amendment and restatement of the Credit Agreement, dated as of November 19,
1999, among the Parent Borrower, the Lenders party thereto, the Administrative
Agent and the Other Representatives.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their proper and duly authorized officers as
of the day and year first above written.
NORTH AMERICAN VAN LINES, INC.
By:/s/Ralph A. Ford
----------------
Name: Ralph A. Ford
Title: Secretary
THE CHASE MANHATTAN BANK, as Collateral
Agent, Administrative Agent, Swing Line
Lender, Issuing Lender and Lender
By:/s/Bruce Borden
-------------------
Name: Bruce Borden
Title: Vice President
THE BANK OF NEW YORK, as Documentation
Agent and Lender
By:/s/David G. Shedd
---------------------
Name: David G. Shedd
Title: Vice President
BANK OF AMERICA SECURITIES LLC, as
Syndication Agent
By:/s/Elizabeth Borow
----------------------
Name: Elizabeth Borow
Title: Managing Director
BANK OF AMERICA, N.A.
By:/s/Elizabeth Borow
----------------------
Name: Elizabeth Borow
Title: Managing Director
<PAGE>
BANKERS TRUST COMPANY
By:/s/Mary Kay Coyle
--------------------
Name: Mary Kay Coyle
Title: Managing Director
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By:/s/Nicholas J. Campbell
--------------------------
Name: Nicholas J. Campbell
Title: Vice President
FLEET NATIONAL BANK
By:/s/Mark S. Pelletier
-----------------------
Name: Mark S. Pelletier
Title: Vice President
HSBC BANK USA
By:/s/Christopher F. French
---------------------------
Name: Christopher F. French
Title: Authorized Signatory
KZH ING-2 L.L.C.
By:/s/Peter Chin
----------------
Name: Peter Chin
Title: Authorized Agent
<PAGE>
NATIONAL CITY BANK OF INDIANA
By:/s/Mark A. Minnick
---------------------
Name: Mark A. Minnick
Title: Senior Vice President
PPM SPYGLASS FUNDING TRUST
By:/s/Kelly C. Walker
---------------------
Name: Kelly C. Walker
Title: Authorized Agent
THE PROVIDENT BANK
By:/s/Thomas W. Doe
-------------------
Name: Thomas W. Doe
Title: Vice President
SUNTRUST BANK, CENTRAL FLORIDA, NA
By:/s/Christopher A. Black
--------------------------
Name: Christopher A. Black
Title: Director
THE BANK OF NOVA SCOTIA
By:/s/F.C.H. Ashby
-----------------
Name: F.C.H. Ashby
Title: Senior Manager Loan Operations
<PAGE>
VAN KAMPEN SENIOR FLOATING RATE FUND
By: Van Kampen Investment Advisory Corp.
By:/s/Darvin D. Pierce
---------------------
Name: Darvin D. Pierce
Title: Vice President
VAN KAMPEN SENIOR INCOME TRUST
By: Van Kampen Investment Advisory Corp.
By:/s/Darvin D. Pierce
---------------------
Name: Darvin D. Pierce
Title: Vice President
<PAGE>
Schedule I
Commitments and Addresses
<PAGE>
Schedule II
Applicable Margin and Commitment Fee Step-Downs
Step-Downs for Revolving Credit Loans, Tranche A Term Loans and Commitment Fees
- -------------------------------------------------------------------------------
================================================================================
Leverage Eurocurrency Loans ABR Loans
Ratio Applicable Margin Applicable Margin Commitment Fee
- --------------------------------------------------------------------------------
Greater than or equal to
4.00 to 1.00 3.00% 2.00% 0.50%
- --------------------------------------------------------------------------------
Greater than or equal to
3.50 to 1.00 and
Less than 4.00 to 1.00 2.75% 1.75% 0.50%
- --------------------------------------------------------------------------------
Greater than or equal to
3.00 to 1.00 and
Less than 3.50 to 1.00 2.50% 1.50% 0.45%
- --------------------------------------------------------------------------------
Greater than or equal to
2.50 to 1.00 and
Less than 3.00 to 1.00 2.25% 1.25% 0.40%
- --------------------------------------------------------------------------------
Less than 2.50 to 1.00 2.00% 1.00% 0.35%
================================================================================
<PAGE>
Schedule III
Designated Foreign Currencies
For purposes of Tranche A Term Loans, Revolving Credit Loans, Swing Line Loans
and Letters of Credit, Designated Foreign Currencies are the following:
Currency Principal Financial Center
-------- --------------------------
Euros Frankfurt
Sterling London
<PAGE>
Schedule IV
Foreign Subsidiary Borrowers
Name Jurisdiction
- ---- ------------
None
<PAGE>
SCHEDULE V
SUBSIDIARY GUARANTORS
1. Fleet Insurance Management, Inc.
2. FrontRunner Worldwide, Inc.
3. NACAL, Inc.
4. North American Distribution Systems, Inc.
5. North American Logistics, Ltd.
6. North American Van Lines of Texas, Inc.
7. NAVTRANS International Freight Forwarding, Inc.
8. Relocation Management Systems, Inc.
9. Great Falls North American, Inc.
10. Vanguard Insurance Agency, Inc.
11. Allied Van Lines, Inc.
12. Allied Freight Forwarding, Inc.
13. A Relocation Solutions Management Company
14. Allied International N.A., Inc.
14. Allied Van Lines Terminal Company
<PAGE>
SCHEDULE VI
INDICATIVE TERMS OF PERMITTED RECEIVABLES SECURITIZATIONS
TRANSACTION SUMMARY: The Parent Borrower may establish, directly or
indirectly, one or more special purpose,
bankruptcy remote subsidiaries (collectively,
the "RECEIVABLES COMPANY") that will purchase,
on a revolving basis, all or a designated
portion of the trade account receivables,
together with any designated assets related to
such receivables such as agreements, security
arrangements, guarantees and other related
assets (collectively, the "RECEIVABLES"),
generated by the Parent Borrower and its
subsidiaries. The purchases of the Receivables
by the Receivables Company will be financed in
part by the creation of a receivables
facility, with or without external credit
enhancement, in which ownership interests in,
or notes, commercial paper, certificates or
other debt instruments secured by or
representing beneficial interests in the
Receivables (such ownership interests, notes,
commercial paper, certificates or instruments,
the "RECEIVABLES SECURITIES") will be sold in
one or more registered public offerings,
private placements, or other available capital
markets transactions by the Receivables
Company or an unaffiliated special purpose
entity. If the financing is provided through
an unaffiliated special purpose entity, the
Parent Borrower may or may not elect to create
a Receivables Company to implement the
transaction.
INTEREST RATE ON
RECEIVABLES SECURITIES: Under the terms of the definitive
documentation for the creation and issuance of
the Receivables Securities (the "RECEIVABLES
FACILITY DOCUMENTS"), the Receivables
Securities will bear interest or have an
equivalent yield thereon at a rate that at the
time of issuance the Parent Borrower
reasonably expects to be less than the
interest rate provided for on the Revolving
Credit Loans (including, in the case of a
fixed rate offering of Receivables Securities,
the interest rate swap equivalent in respect
thereof on the date of issuance thereof).
<PAGE>
LIMITED RECOURSE: The transfer of Receivables by the Parent
Borrower to the Receivables Company will be
made with limited recourse. The Parent
Borrower may be liable under the Receivables
Facility Documents for customary recourse
events, and in any event may be liable for (a)
the breach of certain representations and
warranties (consistent with similar financing
transactions of this type) set forth therein,
(b) the aggregate amount of any dilution with
respect to any transferred Receivables, (c)
its other agreements and obligations
(consistent with similar financing
transactions of this type) under the
Receivables Facility Documents, (d) any
obligations incurred in respect of any
underwriting or placement agency agreements
entered into in connection with the offering
of the Receivables Securities, (e) its
servicing obligations and (f) customary
indemnification and repurchase provisions.
DEFAULT/TERMINATION/
AMORTIZATION EVENTS
UNDER THE RECEIVABLES
FACILITY DOCUMENTS: The Receivables Facility Documents may contain
customary defaults/termination/amortization
events, and in any event may contain the
following defaults/termination/amortization
events: failure to pass certain performance
tests, including maintenance of a minimum
amount of eligible receivables outstanding or
generated during a specified period, a maximum
dilution ratio, delinquency ratio, default
ratio, and maximum days sales outstanding
ratio; nonpayment of amounts when due;
violation of covenants; failure of any
representation or warranty to be true in all
material respects; cross-acceleration to
Parent Borrower's credit facilities;
bankruptcy events with respect to all parties
to the transaction; change in control;
material judgments; tax and ERISA matters; and
actual or asserted (by the Parent Borrower,
the Receivables Company or any of their
affiliates) invalidity of any Receivables
Facility Documents or security or beneficial
interests thereunder; and such other events as
are required by any rating agency rating the
Receivables Securities.
2
<PAGE>
SCHEDULE VII
EXISTING LETTERS OF CREDIT
1. Letter of Credit No. P-399085 in the amount of $20,000 in favor of Air
Cargo.
2. Letter of Credit No. P-289339 in the amount of $17,500 in favor of Spieker
Properties.
3. Letter of Credit No. P-291199 in the amount of $100,000 in favor of
Clearview Limited Partnership.
4. Letter of Credit No. P-293028 in the amount of $500,000 in favor of Golden
Springs Development.
5. Letter of Credit No. P-373046 in the amount of $9,645,000 in favor of
Protective Insurance Company.
6. Letter of Credit No. P-365663 in the amount of $2,300,000 in favor of Safeco
Insurance Company of America.
7. Letter of Credit No. P-373044 in the amount of $250,000 in favor of Chubb
and Son, Inc.
8. Letter of Credit No. P-373042 in the amount of $260,000 in favor of Houston
Casualty Company.
9. Letter of Credit No. P-366734 in the amount of $1,650,000 in favor of
Republic Underwriters Insurance Company.
10. Letter of Credit No. 4674710 in the amount of $2,000,000 in favor of
Underwriters at Lloyds.
<PAGE>
SCHEDULE 4.4(d)
LAST DAY OF FISCAL YEARS
<TABLE>
<CAPTION>
FISCAL YEAR LAST DAY
- ----------- --------
<S> <C>
1999 12/25/99
2000 12/30/00
2001 12/29/01
2002 12/28/02
2003 12/27/03
2004 12/25/04
2005 12/31/05
2006 12/30/06
</TABLE>
<PAGE>
SCHEDULE 5.4
CONSENTS, AUTHORIZATIONS, NOTICES AND FILINGS REQUIRED
None.
<PAGE>
SCHEDULE 5.14
FILING JURISDICTIONS AND LIEN SEARCHES
PART A: FILING JURISDICTIONS
1. NAVL
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Arizona Secretary of State
California Secretary of State
Colorado Secretary of State
Connecticut Secretary of State
Delaware Secretary of State
Georgia Clayton, Fulton, Gwinnett
Hawaii Secretary of State
Iowa Secretary of State
Illinois Secretary of State
Indiana Secretary of State, Allen
Kentucky Secretary of State, Boone
Massachusetts Secretary of State, Chelsea, Framingham,
Milford, Millis, Waltham, Westborough
Maryland Secretary of State
Michigan Secretary of State
Minnesota Secretary of State
Missouri Secretary of State, St. Louis
Montana Secretary of State
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
North Carolina Secretary of State, Durham, Guilford,
Johnston, Mecklenberg, Orange, Wake
Nebraska Secretary of State
New Hampshire Secretary of State, Rockingham
New Jersey Secretary of State
New Mexico Secretary of State
Nevada Secretary of State
New York Secretary of State, Albany, Erie, Nassau,
New York, Onondaga, Westchester
Ohio Secretary of State, Cuyahoga, Franklin
Oregon Secretary of State
Pennsylvania Secretary of State, Butler, Cumberland,
Delaware, Lehigh, Northampton
Texas Secretary of State
Utah Secretary of State
Virginia Secretary of State, Fairfax, Henrico
Washington Secretary of State
Wisconsin Secretary of State
</TABLE>
2. Fleet Insurance Management, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
2
<PAGE>
3. FrontRunner Worldwide, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Indiana Secretary of State
</TABLE>
4. NACAL, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
California Secretary of State
</TABLE>
5. NAVTRANS International Freight Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
6. North American Distribution Systems, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
7. North American Logistics, Ltd.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
8. North American Van Lines of Texas, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Texas Secretary of State
</TABLE>
9. Relocation Management Systems, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Indiana Secretary of State
</TABLE>
10. NA Holding Corporation
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Indiana Secretary of State
</TABLE>
11. Great Falls North American, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Montana Secretary of State
Indiana Secretary of State
</TABLE>
12. Vanguard Insurance Agency, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Illinois Secretary of State
</TABLE>
13. Allied Van Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Illinois Secretary of State, Cook, Du Page
Texas Secretary of State, Tarrant
</TABLE>
14. Allied Freight Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
15. A Relocation Solutions Management Company
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
16. Allied International N.A., Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
17. Allied Van Lines Terminal Company
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
5
<PAGE>
PART B. LIEN SEARCHES
1. NAVL
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Arizona Secretary of State
California Secretary of State
Colorado Secretary of State
Connecticut Secretary of State
Delaware Secretary of State
Georgia Secretary of State, Clayton, Fulton,
Gwinnett
Hawaii Secretary of State
Iowa Secretary of State
Illinois Secretary of State
Indiana Secretary of State, Allen
Kentucky Secretary of State, Boone
Massachusetts Secretary of State, Middlesex, Norfolk,
Suffolk, Worcester
Maryland Secretary of State
Michigan Secretary of State
Minnesota Secretary of State
Missouri Secretary of State, St. Louis
Montana Secretary of State
North Carolina Secretary of State, Durham, Guilford,
Johnston, Mecklenberg, Orange, Wake
Nebraska Secretary of State
New Hampshire Secretary of State, Rockingham
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
New Jersey Secretary of State
New York Secretary of State, Albany, Erie, Nassau,
New York, Onondaga, Westchester
New Mexico Secretary of State
Nevada Secretary of State
Ohio Secretary of State, Cuyahoga, Franklin
Oregon Secretary of State
Pennsylvania Secretary of State, Butler, Cumberland,
Delaware, Lehigh, Northampton
Texas Secretary of State
Utah Secretary of State
Virginia Secretary of State, Fairfax, Henrico
Washington Secretary of State
Wisconsin Secretary of State
</TABLE>
2. A Five Star Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Indiana Secretary of State
</TABLE>
3. A Three Rivers Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
7
<PAGE>
4. A-1 Above Van Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
5. A-1 Summit Van Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
6. Able Van Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
7. Alaska USA Van Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
8. Americas Best Van Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
9. Americas Quality Van Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
8
<PAGE>
10. City Storage & Transfer, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Colorado Secretary of State
Indiana Secretary of State
</TABLE>
11. Fleet Insurance Management, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
12. FrontRunner Worldwide, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Indiana Secretary of State
</TABLE>
13. Great Falls North American, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Montana Secretary of State
Indiana Secretary of State
</TABLE>
14. Move Management Services, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
9
<PAGE>
15. NACAL, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
California Secretary of State
Indiana Secretary of State
</TABLE>
16. World Class Van Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Indiana Secretary of State
</TABLE>
17. NAVTRANS Container Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Florida Secretary of State
Indiana Secretary of State
</TABLE>
18. NAVTRANS International Freight Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
19. NorAm Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
10
<PAGE>
20. North American Distribution Systems, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
21. North American Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
22. North American Logistics, Ltd.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
23. North American Moving & Storage, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
</TABLE>
24. North American Van Lines of Texas, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Texas Secretary of State
Indiana Secretary of State
</TABLE>
25. Relocation Management Systems, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Indiana Secretary of State
</TABLE>
11
<PAGE>
26. Manufacturing Support Services, L.L.C.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
California Secretary of State
Indiana Secretary of State
</TABLE>
27. NA Holding Corporation
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Indiana Secretary of State
</TABLE>
28. Vanguard Insurance Agency, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Illinois Secretary of State
</TABLE>
29. Allied Van Lines, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State, Cook, Du Page
Texas Secretary of State, Tarrant
</TABLE>
30. Allied Freight Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
12
<PAGE>
31. A Relocation Solutions Management Company
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
32. Allied International N.A., Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
33. Allied Intermodal Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
34. Allied Domestic Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
35. Allied Transcontinental Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
13
<PAGE>
36. Allied Transportation Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
37. A.V.L. Transportation, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
38. Allied Interstate Transportation, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
39. Allied Mobility Transportation, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
40. Allied Universal Transportation, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
14
<PAGE>
41. Allied Van Lines, Inc. of Indiana
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Indiana Secretary of State
Illinois Secretary of State
</TABLE>
42. Allied Van Lines Terminal Company
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
43. Meridian Mobility Resources, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
44. Trident Transport International, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
45. TransGuard Insurance Company of America, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Illinois Secretary of State
</TABLE>
15
<PAGE>
46. Allied Alliance Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
47. Allied Continental Forwarding, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
48. ClaimGuard, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Delaware Secretary of State
Illinois Secretary of State
</TABLE>
49. TransGuard General Agency, Inc.
<TABLE>
<CAPTION>
STATE COUNTY/PARISH
- ----- -------------
<S> <C>
Illinois Secretary of State
Oklahoma Secretary of State
Texas Secretary of State, Dallas
</TABLE>
16
<PAGE>
SCHEDULE 5.16
SUBSIDIARIES
SUBSIDIARIES OF NA HOLDING CORPORATION
North American Van Lines, Inc. (Delaware) (100%)
SUBSIDIARIES OF NORTH AMERICAN VAN LINES, INC.
Allied Van Lines, Inc. (Delaware) (100%)
A Five Star Forwarding, Inc. (Delaware) (100%)
A Three Rivers Forwarding, Inc. (Indiana) (100%)
A-1 Above Van Lines, Inc. (Indiana) (100%)
A-1 Summit Van Lines, Inc. (Indiana) (100%)
Able Van Lines, Inc. (Indiana) (100%)
Alaska USA Van Lines, Inc. (Indiana) (100%)
Americas Best Van Lines, Inc. (Indiana) (100%)
Americas Quality Van Lines, Inc. (Indiana) (100%)
City Storage & Transfer, Inc. (Colorado) (100%)
Fleet Insurance Management, Inc. (Indiana) (100%)
FrontRunner Worldwide, Inc. (Delaware) (100%)
Great Falls North American, Inc. (Montana) (100%)
Move Management Services, Inc. (Indiana) (100%)
NACAL, Inc. (California) (100%)
NAVTRANS Container Lines, Inc. (Florida) (100%)
NAVTRANS International Freight Forwarding, Inc. (Indiana) (100%)
NORAM Forwarding, Inc. (Indiana) (100%)
North American Distribution Systems, Inc. (Indiana) (100%)
North American Forwarding, Inc. (Indiana) (100%)
North American International Holding Corporation (Delaware) (100%)
North American Logistics, Ltd. (Indiana) (100%)
North American Moving & Storage, Inc. (Indiana) (100%)
North American Transport Insurance Company (Indiana) (100%)
North American Van Lines of Texas, Inc. (Texas) (100%)
Relocation Management Systems, Inc. (Delaware) (100%)
World Class Van Lines, Inc. (Delaware) (100%)
<PAGE>
SUBSIDIARY OF NORTH AMERICAN LOGISTICS, LTD.
Manufacturing Support Services, L.L.C. (Delaware) (51%)
SUBSIDIARIES OF NORTH AMERICAN INTERNATIONAL HOLDING CORPORATION
Mididata Spedition GMBH (Germany) (100%)
North American (U.K.) Limited (England) (99+%)
North American Van Lines Canada Ltd. (Canada) (100%)
NAVTRANS International Speditions GMBH (Germany) (100%)
Westmount Moving & Storage, Inc. (Canada) (99+%)
NA Acquisition (Ireland) (100%)
NFC International Holdings (Australasia) Pty Ltd (Aus) (100%)
NA (UK) GP Corporation (Delaware) (100%)
NA (UK) Limited Partnership (Delaware) (Limited Partner)
Allied Arthur Pierre SA (Lux) (100%)
Allied Pickfords KeS Kft (Hun) (100%)
A.L. Movers Private Ltd (India) (45%)
Allied Pickfords LLC (UAE) (49%)
Allied Pickfords Ltd (Hong Kong) (100%)
NFC Investment Asia Pacific Pte Ltd (Sing) (100%)
Pierre Finance (Neth) Renting BV (100%)
Allied Pickfords BV (Neth) (100%)
Allied Varekamp BV (Neth) (100%)
Allied Pickfords SP ZOO (Poland) (100%)
Allied Pickfords SRO (Czech) (100%)
Allied Arthur Pierre NV (Belgium) (100%)
Allied Arthur Pierre SA (France) (100%)
Allied International SA (Spain) (100%)
SUBSIDIARY OF NFC INTERNATIONAL HOLDINGS (AUSTRALASIA) PTY LTD
Allied Pickfords Pty Ltd (Aus) (100%)
SUBSIDIARIES OF ALLIED PICKFORDS PTY LTD
Trans International Moving & Shipping Pty Ltd (Aus) (100%)
NFC Australasia Superannuation Pty Ltd (Aus) (100%)
Downward Pickfords (North Queensland) Pty Ltd (Aus) (100%)
NFC New Zealand Ltd (NZ) (100%)
2
<PAGE>
SUBSIDIARIES OF NFC NEW ZEALAND LTD
Allied Pickfords Ltd (NZ) (100%)
Trans International Moving & Shipping (NZ) 1992 Ltd (NZ) (100%)
Imaging Systems (NZ) Ltd (NZ) (100%)
SUBSIDIARIES OF NA (UK) LIMITED PARTNERSHIP
NA Acquisition (UK) Limited (100%)
SUBSIDIARIES OF NA ACQUISITION (UK) LIMITED
Pickfords Ltd. (E&W) (100%)
SUBSIDIARIES OF PICKFORDS LTD.
Pickfords 1999 Limited (E&W) (100%)
A&N Removals Ltd (E&W) (100%)
Arthur Pierre (UK) Ltd (E&W) (100%)
Bullens Ltd (E&W) (100%)
Hoults Removals Ltd (E&W) (100%)
GB Crate Hire Ltd (E&W) (100%)
NFC Moving Services Ltd (E&W) (100%)
Pitt & Scott Ltd (E&W) (100%)
Allied Pickfords Ltd (E&W) (100%)
Pickfords Manhire Ltd (UK) (100%)
Irish Securities Ltd (NI) (100%)
Moving Services Property Ltd (E&W) (100%)
Removedeal Ltd (E&W) (100%)
Irish Security Archives Ltd (Ire) (100%)
SUBSIDIARY OF IRISH SECURITY ARCHIVES LTD
Allied Pickfords Ltd (Ire) (100%)
EQUITY INTEREST OF PICKFORDS 1999 LIMITED
The Baxendale Insurance Company Ltd (Ire) (10%)
SUBSIDIARIES OF ALLIED PICKFORDS LTD (HONG KONG)
3
<PAGE>
Pickfords Worldwide Moving Ltd (HK)
Pickfords Ltd (HK) (100%)
SUBSIDIARIES OF NFC INVESTMENT ASIA PACIFIC PTE LTD
Allied Pickfords (S) Pte Ltd (Sing) (100%)
Allied Pickfords (M) Sdn Bhd (Mal) (100%)
SUBSIDIARY OF NA ACQUISITION (IRELAND)
The Baxendale Insurance Company Ltd (Ire) (90%)
SUBSIDIARY OF MIDIDATA SPEDITION GMBH
Mididata Logistik GMBH (Germany) (100%)
SUBSIDIARY OF NORTH AMERICAN VAN LINES CANADA LTD.
North American Platinum Transportation Group Ltd. (Canada) (100%)
SUBSIDIARIES OF ALLIED VAN LINES, INC.
A Relocation Solutions Management Company (Delaware) (100%)
A.V.L. Transportation, Inc. (Delaware) (100%)
Allied International N.A., Inc. (Delaware) (100%)
Allied Interstate Transportation, Inc. (Delaware) (100%)
Allied Mobility Transportation, Inc. (Delaware) (100%)
Allied Universal Transportation, Inc. (Delaware) (100%)
Allied Van Lines, Inc. of Indiana (Indiana) (100%)
Allied Van Lines Terminal Company (Delaware) (100%)
Meridian Mobility Resources, Inc. (Delaware) (100%)
Trident Transport International, Inc. (Delaware) (100%)
TransGuard Insurance Company of America, Inc. (Illinois) (100%)
Vanguard Insurance Agency, Inc. (Illinois) (100%)
SUBSIDIARY OF ALLIED VAN LINES TERMINAL COMPANY
Allied Freight Forwarding, Inc. (Delaware) (100%)
4
<PAGE>
SUBSIDIARIES OF ALLIED FREIGHT FORWARDING, INC.
Allied Alliance Forwarding, Inc. (Delaware) (100%)
Allied Continental Forwarding, Inc. (Delaware) (100%)
Allied Domestic Forwarding, Inc. (Delaware) (100%)
Allied Intermodal Forwarding, Inc. (Delaware) (100%)
Allied Transcontinental Forwarding, Inc. (Delaware) (100%)
Allied Transportation Forwarding, Inc. (Delaware) (100%)
SUBSIDIARY OF TRANSGUARD INSURANCE COMPANY OF AMERICA, INC.
ClaimGuard, Inc. (Delaware) (100%)
SUBSIDIARY OF VANGUARD INSURANCE AGENCY, INC.
TransGuard General Agency, Inc. (Oklahoma) (100%)
*All subsidiaries whose name contains the term "NFC" will undergo a name change
either prior to or immediately after the Effective Date to replace the term
"NFC" with "AWG."
5
<PAGE>
SCHEDULE 8.2(e)
PERMITTED INDEBTEDNESS
1. NAVL Canada Ltd. has a line of credit with Scotiabank for $2,500,000
(Canadian dollars).
2. Obligations of midiData Logistik GmbH specified as Item 8 on Schedule
8.4(a) to the extent constituting Indebtedness.
3. Indebtedness with respect to the 1,500,000 DM credit facility
specified as Item 9 on Schedule 8.4(a).
4. Obligations of NAVL and its Subsidiaries specified as Items 10 and 12
on Schedule 8.4(a) to the extent constituting Indebtedness.
<PAGE>
SCHEDULE 8.3(j)
PERMITTED LIENS
The following liens identified by lien searches ordered in connection with the
closing:
1. Judgment, dated as of June 16, 1995, in favor of Ferguson
Transportation, Inc. and against NAVL in the amount of $1,300,000 was
recorded in Nassau County, New York. A Satisfaction of Final Judgment
was filed in Palm Beach County, Florida on April 4, 1997. A Notice of
Filing the Clerk's Receipt evidencing the deposit of funds by NAVL in
the amount of $1,987,633.96, was filed in Palm Beach County, Florida,
on April 14, 1997.
2. Judgment, dated as of October 20, 1990, in favor of Bruce D. Rodgers,
Sr. and Carol Rodgers and against NAVL in the amount of $30,000 was
recorded in Camden County, New Jersey. A written release, dated as of
September 4, 1990, was signed evidencing payment of $35,000. A
Stipulation of Dismissal with Prejudice was issued by the U.S.
District Court for the District of New Jersey on September 14, 1990.
3. Judgment, dated as of August 5, 1993, in favor of Casnel Sinclair and
against NAVL in the amount of $6,979 was recorded in Fulton County,
Georgia. A written release, dated as of October 4, 1993, was signed
evidencing payment of $3,250. A Stipulation of Dismissal with
Prejudice was issued by the State Court of Georgia on October 4,
1990.
4. Judgment, dated as of August 29, 1991, in favor of Jeff Beck and
against NAVL and Victor Nilges in the amount of $4,000 was recorded
in Cuyahoga County, Ohio. A written release, dated as of July 14,
1992, was signed evidencing payment of $4,000.
5. Judgment, dated as of June 4, 1991, in favor of R. Clarke Maiocco and
against NAVL in the amount of $132.50 was recorded in Fulton County,
Georgia. Internal NAVL records indicate the judgment was paid as of
June 27, 1991.
6. Judgment in favor of John and Ann Foltz and against NAVL in the
amount of $1,460.09 recorded in Wake County, North Carolina. Internal
NAVL records indicate the judgment was paid as of March 8, 1988 in
the amount of $1,460.09.
<PAGE>
7. Judgment in favor of Fred L. Moye and against NAVL in the amount of
$154.50 recorded in Wake County, North Carolina. Internal NAVL
records indicate the judgment was paid as of November 20, 1992 in the
amount of $154.85.
8. Judgment, dated as of March 14, 1985, in favor of Allied Stores Inc.
and T/A Sterns Inc. and against NAVL Agency in the amount of $550.92
was recorded in New Jersey.
9. Judgment, dated as of January 15, 1993, in favor of the City of
Kentwood regarding title and possession of real property, recorded in
Kent County, Michigan.
10. Judgment, dated as of March 16, 1998, in favor of Keith D. Whitlock,
Sr. and against North American Van Lines Claims Department in the
amount of $94,067, recorded in Dallas County, Texas.
11. Judgment, dated as of April 21, 1992, in favor of Barbara Moorer, et
al. and against Allied Van Lines, Inc. et al. in the amount of
approximately $22,000, recorded in Jefferson County, Texas.
12. Judgment, dated as of April 15, 1999 in favor of Arthur Price and
against North American Van Lines Claims Department in the amount of
$1,176, recorded in Dallas County, Texas.
13. Judgment, dated as of March 24, 1994 in favor of Michaela Andruzzi
and against North American Van Lines in the amount of $390.75,
recorded in Salt Lake County, Utah.
14. Financing Statement Number 2121442 in favor of IBM Credit
Corporation. (IBM Equipment)
15. Financing Statement Number 2132417 in favor of Amdahl Corporation.
(Computer Equipment)
16. Financing Statement Number 2215456 in favor of Pitney Bowes Credit
Corporation. (Pitney Bowes Equipment)
17. Financing Statement Number 2224177 in favor of General Electric
Capital Corporation. (Kentucky Van Trailers)
18. Financing Statement Number 2225833 in favor of Nationscredit
Commercial Corporation. (Computer Equipment)
2
<PAGE>
19. Financing Statement Number 2253629 in favor of Associates Leasing,
Inc. (4 1999 Nissan Vehicles)
20. Financing Statement Number 2253903 in favor of WINR Business Credit,
a trade name of Winthrop Resources Corporation. (Specified leased
property and specified leased furniture)
21. Financing Statement Number 2260643 in favor of General Electric
Capital Corporation. (Furniture Trailers, 30 Kentucky Furniture
Trailers with Leyman Lift Gates and 80 Kentucky Furniture Trailers)
22. Financing Statement Number 2266441 in favor of General Electric
Capital Corporation. (39 1999 Kentucky Furniture Trailers and 50
1999 Strick Furniture Trailers)
23. Financing Statement Number 2267093 in favor of Gelco Corporation dba
GE Capital Fleet Services. (25 Cargo Master 8000 Series Cranes)
24. Financing Statement Number 2269714 in favor of General Electric
Capital Corporation. (46 1999 Kentucky Furniture Trailers)
25. Financing Statement Number 2274059 in favor of General Electric
Capital Corporation. (18 1999 Kentucky Trailers (Model FVCC)
26. Financing Statement Number 2275164 in favor of Amdahl Corporation.
(18 1999 Kentucky Trailers (Model FVCC) and 180 1999 Kentucky
Trailers (Model FVCC-D))
27. Financing Statement Number 2278229 in favor of General Electric
Capital Corporation. (2 1999 Kentucky Trailers (Model FVCC) and 25
1999 Kentucky Trailers (Model FVCC-D))
28. Financing Statement Number 2279529 in favor of General Electric
Capital Corporation. (5 Kentucky Trailers)
29. Financing Statement Number 2280482 in favor of Telimagine, Inc.
(Specified leased video and computer equipment)
30. Financing Statement Number 199906070143421 in favor of Caterpillar
Financial Services Corporation. (3 Caterpillar Lift Trucks lease)
3
<PAGE>
31. Financing Statement Number 199917012 in favor of MCI Capital
Services. (Leased Equipment and Software)
32. Financing Statement Number 002764069 in favor of Pitney Bowes Credit
Corp. (two 1990 Kenworth Tractors and one 1990 Kentucky Trailer)
33. Financing Statement Number 002808774 in favor of Pitney Bowes Credit
Corp. (two 1990 IHC Straight Trucks, two 1990 Kenworth Tractors and
one 1990 Semi Trailer)
34. Financing Statement Number 002936792 in favor of Security Pacific
Equipment Leasing Inc. (Trailers, tractors and trucks)
35. Financing Statement Number 003035701 in favor of Forsythe McArthur
Associates, Inc. (Computer, data processing, telecommunications and
other equipment)
36. Financing Statement Number 003204943 in favor of Fleet Credit Corp
nka Fleet Capital Corp. (Various truck, tractors and trailers)
37. Financing Statement Number 003639803 in favor of Fleet Capital Corp.
as Agent. (Sprint Phone System)
38. Financing Statement Number 003639804 in favor of Fleet Capital Corp.
as Agent. (Computer Equipment)
39. Financing Statement Number 003690547 in favor of General Electric
Capital Corp. (Specified Equipment)
40. Financing Statement Number 003691837 in favor of Fleet Capital Corp.
as Agent. 12 GB Upgrade Raide Access Storage)
41. Financing Statement Number 003763095 in favor of Bell & Howell
Publication Systems Co. (Reader/Printer, Prism Lens, Workstation)
42. Financing Statement Number 003770965 in favor of General Electric
Capital Corp. (Specified Vehicles)
43. Financing Statement Number 003780753 in favor of Bell & Howell
Document Management Products Co. (ABR 2600 Reader Printer and Zoom
Lens and Carrier)
4
<PAGE>
44. Financing Statement Number 003835278 in favor of Associates
Commercial Corp. (Thirteen Specified Vehicles)
45. Financing Statement Number 003904936 in favor of American
Technologies Credit Inc. (Qualcomm tracking units)
46. Financing Statement Number 004004508 in favor of MCI Capital
Services. (Leased Equipment and Software)
47. Financing Statement Number 004008517 in favor of Associates
Commercial Corp. (Twenty-five Specified Vehicles)
48. Financing Statement Number 004018707 in favor of MCI Capital
Services. (Leased Equipment and Software)
49. Financing Statement Number 004047113 in favor of Banc One Leasing
Corp. (Specified Equipment)
50. Financing Statement Number 004062967 in favor of American
Technologies Credit Inc. (Omnitracs Systems)
51. Financing Statement Number 004071402 in favor of American
Technologies Credit Inc. (Qualcomm Mobile Units)
52. Financing Statement Number 004085489 in favor of American
Technologies Credit Inc. (Qualcomm Mobile Units)
53. Financing Statement Number 004101318 in favor of MCI Capital
Services. (Leased Equipment and Software)
54. Financing Statement Number 93-00245029 in favor of Fleet Credit
Corporation. (Leased Specified Truck and Trailers)
55. Financing Statement Number 99-00070678 in favor of MCI Capital
Services. (Leased Equipment Software)
56. Tax Lien Number 9608609421301, dated as of April 8, 1996, in favor of
the Illinois Department of Revenue against Vanguard Insurance Agency,
Inc., in the amount of $5,693.15.
5
<PAGE>
57. Liens listed in Schedule 2.12(a)(ii)(A) to the Disclosure Letter,
dated as of September 14, 1999 from NFC plc to NA Holding
Corporation.
58. Tax liens identified in Attachment 8.3(j)(57) hereto.
6
<PAGE>
SCHEDULE 8.4(a)
GUARANTEE OBLIGATIONS
1. Guarantee given by NAVL Canada Ltd., dated as of December
31, 1989, to the Bank of Nova Scotia in connection with
the Promissory Note issued by Household Movers & Shippers
Limited, dated June 16, 1989, in the original principal
amount of $987,499.99 (Canadian dollars).
2. Guarantee given by NAVL, dated as of May 12, 1999, to Scotiabank in
connection with NAVL Canada Ltd.'s line of credit for $2,500,000
(Canadian dollars).
3. Guarantee given by NAVL Canada Ltd., dated as of February 9, 1996, to
Canadian Imperial Bank of Commerce in connection with a loan issued
to Charles Fair and Penny Fair, who in turn are re-lending to
Dolittle Services, Ltd., an agent of NAVL, in the amount of $50,000
(Canadian dollars).
4. The following Letters of Credit:
<TABLE>
<CAPTION>
START DATE/
ISSUER/BENEFICIARY AMOUNT EXP. DATE REASON
NATIONAL CITY BANK OF
INDIANA
<S> <C> <C> <C>
1. Old Republic Ins. Co. $100,000 12/31/98- Transtar Auto Insurance
12/31/99
THE CHASE MANHATTAN
BANK
1. Air Cargo $20,000 4/2/99-4/2/00 Association Membership
2. Spieker Properties $17,500 7/1/99-7/1/00 San Diego, CA Lease
3. Clearview Limited $100,000 9/1/98-9/1/00 Edison, NJ Lease
Partnership
4. Golden Springs Development $500,000 9/23/99-9/23/00 Santa Fe Springs, CA
Lease
5. Protective Insurance $9,645,000 2/28/97-3/3/00 Bodily injury and
Company property fund
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
6. Safeco Insurance Company of $2,300,000 12/20/96- Bonds
America 12/22/99
7. Chubb and Son, Inc. $250,000 2/28/97-3/3/00 Reinsurance
8. Houston Casualty Company $260,000 2/28/97-2/28/00 Reinsurance
9. Republic Underwriterers $1,650,000 12/31/96- Reinsurance
Insurance Company 12/31/99
10. Underwriters at Lloyds $2,000,000 3/10/99-3/10/00 Bodily injury and
property fund
</TABLE>
<TABLE>
<CAPTION>
FIRST UNION
<S> <C> <C> <C>
1. American Technologies Credit, Inc. $1,000,000 7/1/99-7/1/01 Lease for Qualcomm
truck tracking units
2. American Technologies Credit, Inc. $110,000 7/28/99-7/7/01 Lease for Qualcomm
truck tracking units
3. American Technologies Credit, Inc. $2,600,000 9/1/99-7/7/01 Lease for Qualcomm
truck tracking units
</TABLE>
5. Indemnity Agreements
a. General Indemnity Agreement between St. Paul Fire and
Marine Insurance Company and NAVL, dated as of March 18,
1998 entered into in connection with the execution of
bonds for NAVL and its subsidiaries, as supplemented.
6. Active Surety Bonds of NAVL and Subsidiaries
See attached listing regarding bonds issued under Item 5(a) above.
7. Equipment lease guarantees by midiData Spedition GmbH of the
following equipment leases entered into by midi Data Logistik GmbH.
<TABLE>
<CAPTION>
- -------------------------------------------------------------
EQUIPMENT AMOUNT
<S> <C>
- -------------------------------------------------------------
vehicle HH-MD 465 62,620.88 DM
- -------------------------------------------------------------
vehicle DZ-MD 26 (KYF-MD 17) 62,567.08 DM
- -------------------------------------------------------------
vehicle F0-DT 375 (F0-DT 175) 60,249.96 DM
- -------------------------------------------------------------
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------
EQUIPMENT AMOUNT
<S> <C>
- -------------------------------------------------------------
vehicle F0-DT 148 95,916.15 DM
- -------------------------------------------------------------
vehicle F0-DT 183 103,581.99 DM
- -------------------------------------------------------------
vehicle DZ-MD 14 (KYF-MD 21) 99,363.78 DM
- -------------------------------------------------------------
trailer GG-MD 153 34,132.28 DM
- -------------------------------------------------------------
trailer GG-MD 109 34,132.28 DM
- -------------------------------------------------------------
vehicle NE-MD 532 (GG-MD 158) 112,812.41 DM
- -------------------------------------------------------------
vehicle HH-MD 638 104,295.50 DM
- -------------------------------------------------------------
vehicle GG-MD 545 137,430.00 DM
- -------------------------------------------------------------
vehicle GG-MD 149 18,294.38 DM
- -------------------------------------------------------------
vehicle H-ML 971 66,518.08 DM
- -------------------------------------------------------------
vehicle GG-MD 75 17,811.64 DM
- -------------------------------------------------------------
vehicle LB-MD 218 (GG-MD 365) 105,084.81 DM
- -------------------------------------------------------------
vehicle MB 1424L 137,544.06 DM
- -------------------------------------------------------------
vehicle MB 1631L 162,745.38 DM
- -------------------------------------------------------------
vehicle MB 1628L 149,657.34 DM
- -------------------------------------------------------------
vehicle MB 817L 94,056.16 DM
- -------------------------------------------------------------
vehicle MB 1528L 153,829.92 DM
- -------------------------------------------------------------
vehicle MB 817 84,645.24 DM
- -------------------------------------------------------------
Design stage 91,116.84 DM
- -------------------------------------------------------------
vehicle HH-MD 656 0.00 DM
- -------------------------------------------------------------
vehicle HVL-MD 24 0.00 DM
- -------------------------------------------------------------
vehicle HVL-MD 23 45,529.80 DM
- -------------------------------------------------------------
vehicle F0-DT 714 0.00 DM
- -------------------------------------------------------------
vehicle H-ML 290 0.00 DM
- -------------------------------------------------------------
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------
EQUIPMENT AMOUNT
<S> <C>
- -------------------------------------------------------------
vehicle GG-MD 208 14,320.28 DM
- -------------------------------------------------------------
vehicle GG-MD 216 0.00 DM
- -------------------------------------------------------------
vehicle GG-MD 221 0.00 DM
- -------------------------------------------------------------
vehicle GG-MD 273 0.00 DM
- -------------------------------------------------------------
vehicle LB-MD 417 6,687.29 DM
- -------------------------------------------------------------
vehicle LB-MD 219 94,145.10 DM
- -------------------------------------------------------------
vehicle LB-MD 371 137,030.40 DM
- -------------------------------------------------------------
vehicle DZ-MD 21 (KYF-MD 12) 40,739.71 DM
- -------------------------------------------------------------
vehicle DZ-MD 33 15,367.76 DM
- -------------------------------------------------------------
vehicle H-MD 306 0.00 DM
- -------------------------------------------------------------
vehicle HH-MD 1097 0.00 DM
- -------------------------------------------------------------
vehicle HH-MD 1621 0.00 DM
- -------------------------------------------------------------
vehicle HVL-MD 25 0.00 DM
- -------------------------------------------------------------
vehicle A-M 110 57,868.38 DM
- -------------------------------------------------------------
vehicle A-M 8757 90,271.44 DM
- -------------------------------------------------------------
vehicle A-M 9890 80,806.88 DM
- -------------------------------------------------------------
vehicle A-M 1137 0.00 DM
- -------------------------------------------------------------
vehicle A-M 2827 0.00 DM
- -------------------------------------------------------------
vehicle A-M 3699 0.00 DM
- -------------------------------------------------------------
vehicle A-M 8832 85,367.76 DM
- -------------------------------------------------------------
vehicle NE-MD 1241 (GG-MD 112) 57,786.30 DM
- -------------------------------------------------------------
vehicle NE-MD 1240 (GG-MD 124) 57,766.30 DM
- -------------------------------------------------------------
trailer GG-MD 170 39,485.16 DM
- -------------------------------------------------------------
trailer GG-MD 419 0.00 DM
- -------------------------------------------------------------
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------
EQUIPMENT AMOUNT
<S> <C>
- -------------------------------------------------------------
trailer GG-MD 430 0.00 DM
- -------------------------------------------------------------
vehicle H-MD 570 57,257.18 DM
- -------------------------------------------------------------
vehicle H-MD 760 57,786.30 DM
- -------------------------------------------------------------
vehicle HVL-MD 80 65,005.00 DM
- -------------------------------------------------------------
vehicle HVL-MD 81 56,005.60 DM
- -------------------------------------------------------------
vehicle HVL-MD 82 57,297.50 DM
- -------------------------------------------------------------
vehicle HVL-MD 83 57,297.50 DM
- -------------------------------------------------------------
trailer GG-MD 195 39,485.16 DM
- -------------------------------------------------------------
</TABLE>
8. Other guarantees given by midiData Spedition GmbH with respect to
obligations of midiData Logistik GmbH specified below.
5
<PAGE>
OBLIGATIONS OF MIDIDATA SPEDITION/LOGISTIK GMBH
AS OF 8/31/99
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
GUARANTOR DEBTOR SUBJECT GUARANTEE GIVEN TO AMOUNT/DM
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG Customs Duty Hauptzollamt 50.000,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG Customs Duty Hauptzollamt 50.000,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG Hauptzollamt Ausfuhr Hauptzollamt Ausfuhr 20.000,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG BDF BDF 10.000,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG IATA IATA 50.000,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG DEMEX SYSTEMBAU GmbH DEMEX SYSTEMBAU GmbH 40.967,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG M. Korn, Dr. S. Korn, M. Arend GbR M. Korn, Dr. S. Korn, M. Arend GbR 58.991.58 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG Johann Max Bottcher Johann Max Bottcher 103.962,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG Brixton Estate Neuss GmbH Brixton Estate Neuss GmbH 102.000,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG Werner Rindlaub Werner Rindlaub 75.000,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG Thum + Taxis Imm. Service GmbH Thum + Taxis Imm. Service GmbH 130.000,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG Notel Dasa Network Systems GmbH Notel Dasa Network Systems GmbH 50.000,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG DEMEX SYSTEMBAU GmbH DEMEX SYSTEMBAU GmbH 85.212,00 DM
- -------------------------------------------------------------------------------------------------------------------------------
Subtotal (Deutschmarks Guarantees) 826.132,58 DM
- -------------------------------------------------------------------------------------------------------------------------------
NAVL/Commerzbank midiLOG Gruppe Internationaler GIM 10.320 DM
Mobelspediteure e.v. (GM)
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------
GUARANTOR AMOUNT/USD
<S> <C>
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank
- --------------------------------
NAVL/Commerzbank $6,000.00
- --------------------------------
</TABLE>
6
<PAGE>
9. Letter of Comfort, dated January 21, 1998 and signed February
18, 1998, issued by NAVL to Commerzbank Aktiengesellschaft,
Frankfort Hoechst branch, regarding midiData Spedition GmbH
and midiData Logistik GmbH credit facility in the amount of
1,500,000 DM.
10. Guarantee from NAVL to Generale Bank for Exel Logistics
(Belgium) NV and other Belgian companies, including Allied
Arthur Pierre NV (apx.
$BF55,000,000).
11. Guarantee from NAVL for Contract between Woodside Offshore
Petroleum Pty. Ltd. (Western Australia) and Allied Pickfords
Pty. Ltd. (Victoria) (performance guarantee).
12. Guarantee from Pickfords Limited, NA Moving Services Limited
and others to HSBC Bank plc (guarantee of a bank facility in
the amount of 5,000,000 Pounds).
7
<PAGE>
SCHEDULE 8.9(c)
PERMITTED INVESTMENTS
1. NAVL holds a 51% interest in Manufacturing Support Services
L.L.C., with a capital investment of $554,880.
2. NAVL holds a 40% interest in UTS Europe Holding, B.V., a Dutch
household goods removal company, with a capital investment of
$213,178.
3. NAVTRANS International Freight Forwarding,
Inc. holds a 20% interest in Net-Trans Pty.
Ltd., an Australian freight forwarding
company with a capital investment of $3,864.
4. Note/indebtedness in the amount of $1,200,000 held by NAVL
from Thomas James Malloy, an agent of NAVL, dated as of
September 29, 1995 and signed October 3, 1995.
5. Promissory note in the principal amount of $1,000,000 issued
to NAVL by University Moving & Storage Company, dated as of
March 19, 1997, as amended as of June 16, 1999. The current
principal value on this note is $380,000.
6. NAVL holds a twenty-five percent interest in Conquest
Partners, LLP which was formed for the purpose of purchasing
and operating a 1982 Cessna Citation aircraft.
7. Amended Restated and Consolidated Promissory Note in the
principal amount of $1,090,293.40 issued to Allied Van Lines,
Inc. by Connell Storage & Moving Co., Inc., dated as of
September 22, 1994.
8. Promissory Note in the principal amount of C$670,562.00 issued
to Allied Van Lines Limited and Western Cartage and Storage
(1962) Ltd. by APM Delstar Inc., dated as of April 26, 1996.
9. Promissory Note in the principal amount of C$800,000 issued to
Allied Van Lines, a division of NFC Canada Ltd. by APM Delstar
Inc., dated as of October 31, 1997.
10. Promissory Note in the principal amount of C$912,711.30 issued
to Allied Van Lines, a division of NFC Canada Ltd. by APM
Delstar Inc., dated as of October 31, 1996.
<PAGE>
11. Promissory Note in the principal amount of C$874,704.09 issued
to NFC Canada Ltd. by APM Delstar Inc., dated as of September
29, 1998.
12. Promissory Note in the principal amount of C$300,000 issued to
Allied Van Lines Limited by APM Delstar Inc., dated as of
September 29, 1995.
13. Promissory Note in the principal amount of C$553,830.00 issued
to Allied Van Lines Limited by APM Delstar Inc., dated as of
January 2, 1996.
14. Promissory Note in the principal amount of C$296,170 issued to
Allied Van Lines Limited by APM Delstar Inc., dated as of
March 1, 1996.
15. Promissory Note in the principal amount of C$150,000 issued to
Allied Van Lines Limited by APM Delstar Inc., dated as of
March 5, 1996.
16. Conditional Sales Agreement with terms related to payment of
purchase price among Western Cartage & Storage (1962) Ltd. and
APM Delstar Inc. and Dixon Van Lines, Ltd., Wallace Warehouse
& Cartage Ltd., and Western Moving & Storage Ltd. The sum of
C$1,632,911.25 is to be paid to Western Cartage & Storage
(1962) Ltd. by APM Delstar Inc. pursuant to the terms of the
agreement.
17. Promissory Note in the principal amount of C$650,000 issued to
NFC Canada Ltd. by APM Delstar Inc., dated as of September 29,
1998.
18. Promissory Note in the principal amount of C$325,000 issued to
NFC Canada Ltd. by APM Delstar Inc., dated as of September 29,
1998.
19. Conversion Agreement by and between Allied Van Lines Ltd. and
Jay B. Lilge and MacCosham Van Lines (Canada) Co. Ltd.
whereby Allied would lend up to C$800,000 to Lilge and
MacCosham. As of November 15, 1999, the amount outstanding
on the Conversion Agreement is C$310,225.32. A further
C$400,000 would become due and payable upon the occurrence
of certain specified events such as MacCosham's termination
of its agency contract prior to the tenth anniversary
thereof.
20. North American International Holding Corporation holds a 45%
interest in A.L. Movers Private Ltd (India).
21. North American International Holding Corporation holds a 49%
interest in Allied Pickfords LLC (UAE).
2
<PAGE>
22. Other Equity Interests:
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
COMPANY SHARES CERTIFICATE NO.
<S> <C> <C>
- -------------------------------------------------------------------------------
ABW Systems Corporation 9294 81
- -------------------------------------------------------------------------------
Allied Products Corporation 20 CS16014
- -------------------------------------------------------------------------------
Allied Products Corporation 61 CS16010
- -------------------------------------------------------------------------------
American Healthcare Management, Inc. 420 AHM65
- -------------------------------------------------------------------------------
America West Airlines, Inc. 710 B18278
- -------------------------------------------------------------------------------
Ames Department Stores, Inc. 34 RC20564
- -------------------------------------------------------------------------------
Ames Department Stores, Inc. 35 RC11917
- -------------------------------------------------------------------------------
Ames Department Stores, Inc. 153 RC6556
- -------------------------------------------------------------------------------
Anoka County Farm Bureau Service 1 A3181
Association
- -------------------------------------------------------------------------------
Anoka County Farm Service Cooperative 2 A4017
- -------------------------------------------------------------------------------
ARIX Corporation 468 SFU8413
- -------------------------------------------------------------------------------
Astrodata, Inc. 143 LU459
- -------------------------------------------------------------------------------
Century Geophysical Corporation 24 TCU33477
- -------------------------------------------------------------------------------
Chipwich, Inc. 43 CH0219
- -------------------------------------------------------------------------------
Comstar Corporation 52 1109
- -------------------------------------------------------------------------------
Compace Corporation 299 12210
- -------------------------------------------------------------------------------
Computer Devices, Inc. 18 P276
- -------------------------------------------------------------------------------
Computone Corporation 50 C0394
- -------------------------------------------------------------------------------
Computr Ex Centres Ltd. 26 A-055
- -------------------------------------------------------------------------------
Containers Terminal of Baltimore, Inc. 10 1
- -------------------------------------------------------------------------------
Continental Information Systems 76 CIS1331
Corporation
- -------------------------------------------------------------------------------
Continental Information Systems 6 CIS2218
Corporation
- -------------------------------------------------------------------------------
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
COMPANY SHARES CERTIFICATE NO.
<S> <C> <C>
- -------------------------------------------------------------------------------
Continental Information Systems 1 CIS3603
Corporation
- -------------------------------------------------------------------------------
Digitech, Inc. 166 P3662
- -------------------------------------------------------------------------------
Extek Microsystems, Inc. 554 LU5122
- -------------------------------------------------------------------------------
M.H. Fishman Co. Inc. 20 FC024300
- -------------------------------------------------------------------------------
Foodbrands America, Inc. 123 FBA0429
- -------------------------------------------------------------------------------
Foodbrands America, Inc. 2 FBA2384
- -------------------------------------------------------------------------------
Gamex Industries, Inc. 8897 U19502
- -------------------------------------------------------------------------------
Hillcrest Carpets, Inc. 28 CPS0156
- -------------------------------------------------------------------------------
Interdyne Company 1323 N2100
- -------------------------------------------------------------------------------
Jetflorida, Inc. 14 JCO612
- -------------------------------------------------------------------------------
W.P. Acquisition Corporation 10 272
- -------------------------------------------------------------------------------
Keydata Corporation 1985 B3577
- -------------------------------------------------------------------------------
Keydata Corporation 4 B5007
- -------------------------------------------------------------------------------
Lezak Group Inc. 8477 LA003217
- -------------------------------------------------------------------------------
Lori Corporation 5 LC339
- -------------------------------------------------------------------------------
MPS International Corp. 26 05242
- -------------------------------------------------------------------------------
Maxicare Health Plans, Inc. 22 M9399
- -------------------------------------------------------------------------------
Maxicare Health Plans, Inc. 16 M3372
- -------------------------------------------------------------------------------
Maxicare Health Plans, Inc. 37 M15367
- -------------------------------------------------------------------------------
Miller Shoe Industries, Inc. 1503 MSU514
- -------------------------------------------------------------------------------
Miller Shoe Industries, Inc. 2074 MSU264
- -------------------------------------------------------------------------------
Paladin Computer Systems, Inc. 961 160
- -------------------------------------------------------------------------------
Pet Bazaar, Inc. 184 CU959
- -------------------------------------------------------------------------------
Pizza Inn, Inc. 98 PI5525
- -------------------------------------------------------------------------------
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
COMPANY SHARES CERTIFICATE NO.
<S> <C> <C>
- -------------------------------------------------------------------------------
Pizza Inn, Inc. 330 PI0116
- -------------------------------------------------------------------------------
RM Electronics Company, Inc. 19 60
- -------------------------------------------------------------------------------
Ramtek Corporation 1948 SF0294
- -------------------------------------------------------------------------------
Ranger Industries, Inc. 3 N4353
- -------------------------------------------------------------------------------
Ranger Industries, Inc. 62 N1330
- -------------------------------------------------------------------------------
Ranger Industries, Inc. 5 N1879
- -------------------------------------------------------------------------------
Reunited Holdings, Inc. 2200 RHO313
- -------------------------------------------------------------------------------
Robeson Industries Corp. 8 RIC0429
- -------------------------------------------------------------------------------
Santec Corporation 1445 FBU16982
- -------------------------------------------------------------------------------
Savin Corporation 275 SVC681
- -------------------------------------------------------------------------------
SeraCare, Inc. 46 1249
- -------------------------------------------------------------------------------
Servico, Inc. 29 SI5188
- -------------------------------------------------------------------------------
Servico, Inc. 16 SI11854
- -------------------------------------------------------------------------------
Servico, Inc. 222 SI2112
- -------------------------------------------------------------------------------
Servico, Inc. 20 SI14396
- -------------------------------------------------------------------------------
Servico, Inc. 65 SI18011
- -------------------------------------------------------------------------------
Servico, Inc. 1 SI22853
- -------------------------------------------------------------------------------
Solvation, Inc. 902 47
- -------------------------------------------------------------------------------
Strata Search, Inc. 3 PC64
- -------------------------------------------------------------------------------
Synergistics, Inc. 791 5058
- -------------------------------------------------------------------------------
Tetrahedron Associates, Inc. 173 JU626
- -------------------------------------------------------------------------------
Thinking Machines Corporation 361 0067
- -------------------------------------------------------------------------------
Thinking Machines Corporation 904 0067
- -------------------------------------------------------------------------------
Triad Hotels 7 394
- -------------------------------------------------------------------------------
Triad Hotels 30 410
- -------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
COMPANY SHARES CERTIFICATE NO.
<S> <C> <C>
- -------------------------------------------------------------------------------
Triad Hotels 7 411
- -------------------------------------------------------------------------------
United Merchants and Manufacturers, Inc. 4 31007
- -------------------------------------------------------------------------------
Vicom Systems, Inc. 959.39388 PA-62
- -------------------------------------------------------------------------------
Vicom Systems, Inc. 36.51693 C-62
- -------------------------------------------------------------------------------
World-Wide Technology Inc. 131 ZQ0006127
- -------------------------------------------------------------------------------
Z&B Investments Co., Inc. 810 63
- -------------------------------------------------------------------------------
AM Diagnostics, Inc. 10 AA0000389
- -------------------------------------------------------------------------------
AM International, Inc. 10 ST 041647
- -------------------------------------------------------------------------------
AM International, Inc. 83 ST 029599
- -------------------------------------------------------------------------------
AM International, Inc. 199 ST 029518
- -------------------------------------------------------------------------------
AM International, Inc. 4 ST 070712
- -------------------------------------------------------------------------------
AM International, Inc. 10 ST 073502
- -------------------------------------------------------------------------------
AM International, Inc. 6 ST 041563
- -------------------------------------------------------------------------------
AM International, Inc. 395 ST 016090
- -------------------------------------------------------------------------------
AM International, Inc. 165 ST 016101
- -------------------------------------------------------------------------------
Apeco Corporation 3 CA16124
- -------------------------------------------------------------------------------
Beehive International 733 SFS 91559
- -------------------------------------------------------------------------------
Beehive International 1683 SFS 85585
- -------------------------------------------------------------------------------
BSL Technology 3348 1452
- -------------------------------------------------------------------------------
Helionetics, Inc. 252 SF 43574
- -------------------------------------------------------------------------------
Helionetics, Inc. 256 SF 43575
- -------------------------------------------------------------------------------
Helionetics, Inc. 512 SW 0211
- -------------------------------------------------------------------------------
Helionetics, Inc. 504 SW 0210
- -------------------------------------------------------------------------------
Imutech, Inc. 540 8694
- -------------------------------------------------------------------------------
KSW, Inc. 21 KS 0026
- -------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
COMPANY SHARES CERTIFICATE NO.
<S> <C> <C>
- -------------------------------------------------------------------------------
Mayflower Group, Inc. 10 M 0001284
- -------------------------------------------------------------------------------
Minstar 10 10771
- -------------------------------------------------------------------------------
Norfolk Southern Corporation 60 NS 043157
- -------------------------------------------------------------------------------
Norfolk Southern Corporation 20 N 901318
- -------------------------------------------------------------------------------
Norfolk Southern Corporation 10 N 199933
- -------------------------------------------------------------------------------
Peripheral Systems, Inc. 239 C01-0107
- -------------------------------------------------------------------------------
Peripheral Systems, Inc. 197 C01-0108
- -------------------------------------------------------------------------------
Peripheral Systems, Inc. 56 C01-0109
- -------------------------------------------------------------------------------
Puridyne, Inc. 270 1006
- -------------------------------------------------------------------------------
Savin Corporation 24 SVC 225
- -------------------------------------------------------------------------------
Seatrain Lines, Inc. 1845 SLR 2007
- -------------------------------------------------------------------------------
Seatrain Lines, Inc. 3945 SLR 2009
- -------------------------------------------------------------------------------
Seatrain Lines, Inc. 571 SLW 0081
- -------------------------------------------------------------------------------
Seatrain Lines, Inc. 1219 SLW 0085
- -------------------------------------------------------------------------------
Servico, Inc. 26 SI 15347
- -------------------------------------------------------------------------------
Servico, Inc. 20 SI 10051
- -------------------------------------------------------------------------------
Servico, Inc. 70 SI 16582
- -------------------------------------------------------------------------------
Servico, Inc. 284 SI 0120
- -------------------------------------------------------------------------------
Servico, Inc. 1 SI 21267
- -------------------------------------------------------------------------------
The Shirt Shed, Inc. 233 1087
- -------------------------------------------------------------------------------
Storagetek 2 ST 66427
- -------------------------------------------------------------------------------
Storagetek 2 ST 66426
- -------------------------------------------------------------------------------
Telelogic, Inc. 122 299
- -------------------------------------------------------------------------------
Templeton Energy, Inc. 91 C 21475
- -------------------------------------------------------------------------------
Templeton Energy, Inc. 24 C 25102
- -------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
COMPANY SHARES CERTIFICATE NO.
<S> <C> <C>
- -------------------------------------------------------------------------------
Tocoma Boatbuilding Co. 172 TBC 0104
- -------------------------------------------------------------------------------
Tri-lite Inc. 1 TL 0461
- -------------------------------------------------------------------------------
Tri-lite Inc. 1 TL0460
- -------------------------------------------------------------------------------
Vanderbilt Gold Corporation 500 LU 8069
- -------------------------------------------------------------------------------
</TABLE>
8
<PAGE>
SCHEDULE 8.11(v)
PERMITTED TRANSACTIONS WITH AFFILIATES
1. Letter of Intent from UTS Europe Holding, B.V. to lease PROPAC
containers from NAVL, dated as of June 15, 1994, and related
agreements to be entered into.
2. Agreement between NAVTRANS International Freight Forwarding,
Inc. and Net-Trans Pty, Ltd., dated as of May 27, 1993, for
each party to act as the nonexclusive agent of the other for
the handling and forwarding of ocean and air cargo.
3. Indemnification Agreement, dated as of March 30, 1998, among
the Buyer, NAVL, Clayton, Dubilier & Rice, Inc. and CD&R Fund V.
4. Consulting Agreement, dated as of March 30, 1998, among the
Buyer, NAVL and Clayton, Dubilier & Rice, Inc., as amended by
Amendment No. 1, dated April 1, 1998.
5. Registration and Participation Agreement, dated as of March 30,
1998, by and between the Buyer and CD&R Fund V, as amended.
6. Amendment No. 1 to the Registration and Participation
Agreement, dated as of the Closing Date, between NA Holding
Corporation and Clayton, Dubilier & Rice Fund V Limited Partnership.
7. Management and Cost Allocation Agreement, dated as of July 18,
1990, by and between NAVL and North American Transport
Insurance Company, as amended.
8. Stock Subscription Agreement, dated as of March 30, 1998, by
and between the Buyer and CD&R Fund V.
9. Transition Services Agreement, dated as of the Closing Date,
between NFC plc and NA Holding Corporation.
10. Various shared facilities leases with Pickfords Ltd. and its
Subsidiaries with respect to facilities located in the United
Kingdom.
11. Tax Matters Agreement between NA Holding Corporation and NFC
plc, dated as of September 14, 1999.
<PAGE>
12. Letter Agreement, dated as of the Closing Date, among NA
Holding Corporation, North American Van Lines, Clayton,
Dubilier & Rice Fund V Limited Partnership and NFC plc.
13. Acquisition Agreement, dated as of September 14, 1999, between
NFC plc and NA Holding Corporation.
14. Stock Subscription Agreement, dated as of November 19, 1999,
between NA Holding Corporation and Clayton, Dubilier & Rice
Fund V Limited Partnership, a Cayman Islands exempted limited
partnership.
15. Stock Subscription Agreement, dated as of November 19, 1999,
between NA Holding Corporation and NFC plc.
2
<PAGE>
Attachment
Item 8.4(a)(6)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
TYPE ST OBLIGEE PRINCIPAL AMOUNT EFFECTIVE EXPIRATION
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Fidelity IN IN Dept. of North American 150,000 01/16/1998 01/16/2001
Insurance Transport Inc. Co.
- -----------------------------------------------------------------------------------------------------------------------------------
Game of CN Repe des North American Van 7,680 02/11/1999 02/11/2000
Chance Alcoofs des Lines Canada, Inc.
courses et des
Jeux
- -----------------------------------------------------------------------------------------------------------------------------------
Lost OK 1st Bk of North American Van 185.80 04/09/1998 04/09/2005
Instrument Chandler/OK Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge FL FL DOT North American Van 35,000 09/01/1999 08/01/2000
Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Performance US GSA North American Van 20,000 11/01/1998 12/31/1999
Lines, Inc. (NAVI)
- -----------------------------------------------------------------------------------------------------------------------------------
Performance US GSA North American Van 75,000 11/01/1998 12/31/1999
Lines, Inc. (NAVI)
- -----------------------------------------------------------------------------------------------------------------------------------
Lost FL Bank of North American Van 10,490.17 10/21/1998 10/21/2005
Instrument Ormond by the Lines, Inc.
Sea
- -----------------------------------------------------------------------------------------------------------------------------------
Lost TX Lone Star North American Van 1,992.42 11/12/1998 11/12/2005
Instrument Bank, N.A. Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
NVOOC US Federal FrontRunner 75,000 04/20/1999 04/20/2000
Maritime Worldwide, Inc.
Commission
- -----------------------------------------------------------------------------------------------------------------------------------
NVOOC US Federal North American Van 95,000 04/20/1999 04/20/2000
Maritime Lines, Inc.
Commission
- -----------------------------------------------------------------------------------------------------------------------------------
NVOOC US Federal North American (U.K.) 75,000 04/20/1999 04/20/2000
Maritime Limited
Commission
- -----------------------------------------------------------------------------------------------------------------------------------
NVOOC US Federal NAVTRANS 185,000 04/20/1999 04/20/2000
Maritime Container Lines, Inc.
Commission
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
TYPE ST OBLIGEE PRINCIPAL AMOUNT EFFECTIVE EXPIRATION
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Freight US Federal NAVTRANS IFF dba 160,000 04/20/1999 04/20/2000
Forwarder Maritime No. Amer. Intl.
Commission
- -----------------------------------------------------------------------------------------------------------------------------------
Fuel Tax OR Oregon, State North American Van 2,000 05/20/1999 05/20/2000
of Lines Canada Ltd.
- -----------------------------------------------------------------------------------------------------------------------------------
Escrow IN Duke Weeks North American Van 4,000,000 09/20/1999 09/20/2000
Guarantee Realty Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Institutional IN IN North American Van 5,000 10/01/1999 10/01/2000
Commission Lines, Inc.
on Proprietary
Education
- -----------------------------------------------------------------------------------------------------------------------------------
Lost U.S. Bank Banasch, Marcia 1,914 10/21/1999 10/25/2008
Instrument
- -----------------------------------------------------------------------------------------------------------------------------------
Producer IL Illinois Dept. Fleet Insurance 1,000 10/17/1997 10/17/2000
of Ins. Management
- -----------------------------------------------------------------------------------------------------------------------------------
Liquor PA PA Liquor North American Van 3,000 12/31/1997 12/31/1999
Control Board Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Customs - CN CN Revenue North American Van 50,000 12/15/1998 12/15/1999
Canada Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Workers IN IN WCB North American Van 5,500,000 09/01/1998 UC
Compensation Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Customs - US US Dept. of the North American Van 100,000 09/12/1998 09/12/1999
Treasury Lines Canada Ltd.
- -----------------------------------------------------------------------------------------------------------------------------------
Property US ICC NAVTRANS IFF dba 10,000 02/25/1999 02/26/2000
Broker No. Amer. Intl.
- -----------------------------------------------------------------------------------------------------------------------------------
Performance US Military North American Van 25,000 09/01/1995 03/01/1999
Traffic Mgmt. Lines, Inc. (NAVH)
Command
- -----------------------------------------------------------------------------------------------------------------------------------
Performance US U.S. Dept. of North American Van 25,000 09/28/1996 09/28/1998
State Lines, Inc. (NOAM)
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge PA PA Turnpike North American Van 10,000 09/22/1997 09/22/2000
Commission Lines, Inc. (FLB)
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge PA PA Turnpike North American Van 15,000 09/22/1997 09/22/2000
Commission Lines, Inc. (RSD)
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
TYPE ST OBLIGEE PRINCIPAL AMOUNT EFFECTIVE EXPIRATION
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Toll Charge NY NY Thruway North American Van 250,000 01/03/1999 01/03/2000
Authority Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
COD CA California North American Van 2,000 01/01/1997 01/01/2000
PUC Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
COD CA California NACAL, Inc. 15,000 01/01/1997 01/01/2000
PUC
- -----------------------------------------------------------------------------------------------------------------------------------
Subhauler CA California NACAL, Inc. 15,000 01/01/1997 01/01/2000
PUC
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge PA PA Turnpike North American Van 55,000 02/04/1999 02/04/2000
Commission Lines, Inc. (HVP)
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge PA PA Turnpike North American Van 25,000 02/04/1999 02/04/2000
Commission Lines, Inc. (BLK)
- -----------------------------------------------------------------------------------------------------------------------------------
Property US IDS/STB(?) North American Van 10,000 02/17/1999 02/17/2000
Broker Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Performance US Military North American Van 185,465 03/31/1999 03/31/2000
Traffic Mgmt. Lines, Inc.
Command
- -----------------------------------------------------------------------------------------------------------------------------------
Insurance LA LA Fleet Insurance 25,000 04/23/1999 04/23/2000
Broker Commissioner Management
of Insurance
- -----------------------------------------------------------------------------------------------------------------------------------
Insurance LA LA James E. Phillabaum 25,000 04/23/1999 04/23/2000
Broker Commissioner
of Insurance
- -----------------------------------------------------------------------------------------------------------------------------------
Property US ICC FrontRunner 10,000 04/19/1999 04/19/2000
Broker Worldwide, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Subhauler CA California North American Van 10,000 08/31/1997 08/31/2000
PUC Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Property US ICC North American 10,000 08/26/1997 08/26/2000
Broker Logistics Ltd.
- -----------------------------------------------------------------------------------------------------------------------------------
Freight XX TPAFBO North American Van 200,000 10/31/1997 10/31/2000
Indemnity Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge MA MA Turnpike North American Van 4,500 12/02/1997 12/02/2000
Authority Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Property US ICC North American 10,000 01/08/1999 01/06/2000
Broker Forwarding, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
TYPE ST OBLIGEE PRINCIPAL AMOUNT EFFECTIVE EXPIRATION
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Freight XX TAAFLO North American Van 100,000 05/31/1999 05/31/2000
Indemnity Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Institutional IN Indiana, State No. Amer. Van Lines 5,000 02/22/1999 02/22/2000
of dba CDL Plus
- -----------------------------------------------------------------------------------------------------------------------------------
Freight XX Pasha North American Van 30,000 04/06/1999 04/06/2000
Indemnity International Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Financial KY KY, Common James E. Phillabaum 1,000 06/19/1999 06/19/2000
Responsibility wealth of
- -----------------------------------------------------------------------------------------------------------------------------------
Customs - US US Dept. of the North American Van 200,000 05/02/1999 05/02/2000
Treasury Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Employment IN Indiana, State North American Van 5,000 07/05/1999 07/05/2000
Agency of Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Insurance IL IL Dept. of James E. Phillabaum 2,600 03/13/1999 03/13/2000
Producer Insurance
- -----------------------------------------------------------------------------------------------------------------------------------
Highway Use OR Oregon PUC North American Van 30,000 06/06/1999 06/05/2000
Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge NJ NJ Turnpike North American Van 60,000 09/25/1996 09/25/1999
Authority Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge IN IN DOT/Toll North American Van 30,000 09/26/1996 09/25/1999
Road Division Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge OH Ohio Turnpike North American Van 100,000 09/25/1996 09/25/1999
Commission Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Toll Charge MA MA Turnpike North American Van 15,000 09/25/1998 09/25/1999
Authority Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Property US ICC Move Management 10,000 10/14/1998 10/14/1999
Broker Services, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Performance US GSA North American Van 20,000 11/01/1998 10/31/1999
Lines, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Customs Suff. CN Revenue NAVLCL dba All 20,000 12/15/1998 12/15/1999
Whse Canada Cities NA
- -----------------------------------------------------------------------------------------------------------------------------------
Customs - ON CN Revenue North American Van 25,000 12/15/1998 12/15/1999
Canada Lines Canada Ltd.
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
BOND Principal Obligee Description Eff. & Bond Amount
NO. Exp.
Date
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
4788984 A Relocation Federal Highway Admin- License & 1/31/99 $10,000
Solutions Offc of M.C. Permit - 00
Management
Company
- -----------------------------------------------------------------------------------------------------------------------------------
5894094 A.V.L. Federal Hwy Admin-Sec of Property 2/15/99 $10,000
Transportation Ins. Broker's Surety - 00
, Inc. Bond Under 49
U.S.C.
- -----------------------------------------------------------------------------------------------------------------------------------
4684527 Allied Freight Trans-Pacific American Freight 11/17/9 $50,000
Forwarding, Flag Berth Operators Indemnity Bond 8 - 01
Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5083969 Allied Freight Military Traffic Mgmt Annual 4/1/99 - $189,990
Forwarding, Command-Dept of Army Performance 00
Inc. Bond (Supply)
- -----------------------------------------------------------------------------------------------------------------------------------
5353481 Allied Freight Trans-Atlantic American Freight 3/4/99 - $50,000
Forwarding, Flag Liner Operators Indemnity Bond 00
Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5685258 Allied Freight Federal Maritime Non-Vessel 2/14/99 $75,000
Forwarding, Commission Operating - 00
Inc. Common Carrier
Bond
- -----------------------------------------------------------------------------------------------------------------------------------
5894093 Allied Freight Federal Hwy Admin-Sec of License & 2/15/99 $10,000
Forwarding, Insurance Permit - 00
Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5963086 Allied Freight American President Lines, Freight 4/30/99 $125,000
Forwarding, Ltd. Indemnity Bond - 00
Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
4368750 Allied U.S.A. Federal Maritime Federal 7/9/99 - $50,000
International Commission Maritime 00
N.A., Inc. Commission
Independent
Ocean Freight
Forwarder's
Bond
- -----------------------------------------------------------------------------------------------------------------------------------
4383534 Allied Federal Highway Admin.- Broker's Surety 11/3/99 $10,000
International Office of Motor Carriers Bond Under - 00
N.A., Inc. Section 211(C)
of the Interstate
Commerce Act
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
5
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
5685257 Allied Federal Maritime Non-Vessel 2/14/99 $75,000
International Commission Operating - 00
N.A., Inc. Common Carrier
Bond
- -----------------------------------------------------------------------------------------------------------------------------------
5877826 Allied Federal Maritime Ocean Freight 10/26/9 $40,000
International Commission Forwarder Bond 9 - 00
N.A., Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5894072 Allied GSA Centralized Performance 11/1/99 $75,000
International Household Goods Traffic Bond -
N.A., Inc. Mgmt Program 9/30/00
- -----------------------------------------------------------------------------------------------------------------------------------
5894092 Allied Federal Hwy Admin-Sec of License & 2/15/99 $10,000
International Insurance Permit - 00
N.A., Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5894073 Allied GSA Centralized Performance 11/1/99 $20,000
Relocation Household Goods Traffic Bond - 00
Services, Inc. Mgmt Program
- -----------------------------------------------------------------------------------------------------------------------------------
5894079 Allied GSA Centralized Performance 10/31/9 $20,000
Relocation Household Goods Traffic Bond 9 - 00
Services, Inc. Mgmt Program
- -----------------------------------------------------------------------------------------------------------------------------------
5913771 Allied GSA Centralized Performance 11/1/99 $75,000
Relocation Household Goods Traffic Bond - 00
Services, Inc. Mgmt Program
- -----------------------------------------------------------------------------------------------------------------------------------
892897 Allied Van Commonwealth of License & 8/11/99 $1,000
Lines, Inc. Kentucky, Div of Motor Permit - 00
Carriers
- -----------------------------------------------------------------------------------------------------------------------------------
921826 Allied Van Kentucky Dept. of Vehicle License & 6/21/99 $25,000
Lines, Inc. Regulations Permit - 00
- -----------------------------------------------------------------------------------------------------------------------------------
2436352 Allied Van State of California License & 9/1/99 - $15,000
Lines, Inc. Permit 00
- -----------------------------------------------------------------------------------------------------------------------------------
2537278 Allied Van State of Texas License & 5/27/99 $2,500
Lines, Inc. Permit - 02
- -----------------------------------------------------------------------------------------------------------------------------------
2585794 Allied Van Georgia Public Service Miscellaneous 12/23/9 $1,000
Lines, Inc. Commission 8 - 99
- -----------------------------------------------------------------------------------------------------------------------------------
2881637 Allied Van United States of America License & 9/6/99 - $10,000
Lines, Inc. Permit 00
- -----------------------------------------------------------------------------------------------------------------------------------
2894033 Allied Van Trans-Atlantic American Freight 8/9/97 - $50,000
Lines & Flag Liner Operators Indemnity Bond 00
Allied Int'l
NA
- -----------------------------------------------------------------------------------------------------------------------------------
4160704 Allied Van State of Wyoming WC Financial 10/28/9 $1,000
Lines, Inc. Officer The State Treasury Guarantee 9 - 00
- -----------------------------------------------------------------------------------------------------------------------------------
5173518 Allied Van United States of America Carriers Bond 8/28/99 $25,000
Lines, Inc. - 00
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
6
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
5202597 Allied Van Interstate Commerce License & 11/22/9 $10,000
Lines, Inc. Commission Permit 9 - 00
- -----------------------------------------------------------------------------------------------------------------------------------
5749785 Allied Van Military Traffic Performance 1/15/99 $100,000
Lines, Inc. Management Command Bond - 00
- -----------------------------------------------------------------------------------------------------------------------------------
5894091 Allied Van Federal Hwy Admin-Sec of License & 2/15/99 $10,000
Lines, Inc. Ins. Permit - 00
- -----------------------------------------------------------------------------------------------------------------------------------
5930666 Allied Van Commonwealth of Court & 4/28/99 $267,671
Lines, Inc. Pennsylvania Fiduciary - 00
- -----------------------------------------------------------------------------------------------------------------------------------
5930667 Allied Van Commonwealth of Court & 4/28/99 $13,206
Lines, Inc. Pennsylvania Fiduciary - 00
- -----------------------------------------------------------------------------------------------------------------------------------
5894082 TransGuard California Dept. of Ins. License & 1/30/99 $10,000
General Permit - 00
Agency, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5899897 TransGuard State of IL Dept. of Ins. License & 5/8/99 - $32,500
General Permit 00
Agency, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5963063 TransGuard New Hampshire Ins. Dept. License & 1/25/99 $2,500
General Permit - 00
Agency, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5963064 TransGuard General Treasurer of License & 1/25/99 $5,000
General Rhode Island Permit - 00
Agency, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5963065 TransGuard Arizona Ins. Licensing License & 1/25/99 $1,000
General Section Permit - 00
Agency, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5963066 TransGuard Indiana Dept. of Insurance License & 1/25/99 $2,500
General Permit - 00
Agency, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5963069 TransGuard Insurance Administration License & 4/30/99 $10,000
General Permit - 01
Agency, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
5946258 Trident Federal Maritime Non-Vessel 5/1/99 - $75,000
Transport Commission Operating 00
International, Comm Carrier
Inc. Bond
- -----------------------------------------------------------------------------------------------------------------------------------
2383279 Vanguard Ins. State of Nevada License & 1/21/98 $5,000
Agency, Inc. Permit - 01
- -----------------------------------------------------------------------------------------------------------------------------------
2383281 Vanguard Ins. General Treasurer of the License & 1/21/98 $1,000
Agency, Inc. State of Rhode Island Permit - 01
- -----------------------------------------------------------------------------------------------------------------------------------
2585804 Vanguard Ins. State of IL License & 2/28/97 $50,000
Agency, Inc. Permit - 00
- -----------------------------------------------------------------------------------------------------------------------------------
2868052 Vanguard Ins. Pennsylvania Dept. of Ins. License & 5/8/99 - $2,500
Agency, Inc. Permit 02
</TABLE>
Charee/SafecoBonds
7
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
4791951 Vanguard Ins. New York Dept. of Ins. License & 5/21/9 - $2,500
Agency, Inc. Broker Div. Permit 00
- -----------------------------------------------------------------------------------------------------------------------------------
5083972 Vanguard Ins. State of Oklahoma License & 2/5/99 - $2,500
Agency, Inc. Permit 00
- -----------------------------------------------------------------------------------------------------------------------------------
5083981 Vanguard Ins. North Dakota Dept. of Ins. License & 2/11/99 $20,000
Agency, Inc. Permit - 00
- -----------------------------------------------------------------------------------------------------------------------------------
5257390 Vanguard Ins. State of Maryland - Ins. License & 6/30/99 $10,000
Agency, Inc. Div. Permit - 00
- -----------------------------------------------------------------------------------------------------------------------------------
5759494 Vanguard Ins. Arizona Dept. of Ins. Non Resident 5/24/99 $1,000
Agency, Inc. Ins. Broker - 00
- -----------------------------------------------------------------------------------------------------------------------------------
5873083 Vanguard Ins. IL Director of Ins. Broker License & 5/8/99 - $20,000
Agency, Inc. Licensing Div. Permit 00
- -----------------------------------------------------------------------------------------------------------------------------------
2383275 Vanguard Ins. People of the State of License & 1/24/98 $10,000
Agency, Inc. Idaho Permit - 01
- -----------------------------------------------------------------------------------------------------------------------------------
2382853 Vanguard Ins. State of New Hampshire License & 5/9/98 - $1,000
Agency, Inc. Permit 01
- -----------------------------------------------------------------------------------------------------------------------------------
2223941 Vanguard Ins. California Dept. of Ins. License & 2/22/99 $10,000
Agency, Inc. Permit - 02
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
8
<PAGE>
SAFECO BONDS
Attachment 8.3(j)(57)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
JURISDICTION SERVICE FILE DATE AND NUMBER SECURED PARTY COLLATERAL DESCRIPTION
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 10/08/1992 Pitney Bowes Credit Corp Specified Leases
003038407
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 05/14/1993 Pitney Bowes Credit Corp Specified Leases
003121627
- -----------------------------------------------------------------------------------------------------------------------------------
Cook Illinois JUD 08/04/1995 Daniel M. Salata $598.00
95M3 2536
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 07/29/1994 Donald T. Markland $5,000.00
9274
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 08/02/1993 Felicia C. Willis There are no proceedings
621619 pending to enforce any
judgment in connection
with this case. The
Borrower will determine
and report to the
Administrative Agent the
status of this case.
- -----------------------------------------------------------------------------------------------------------------------------------
Jefferson Texas JUD 12/20/1996 Jerry Peveto et al Settled
82146
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
JURISDICTION SERVICE FILE DATE AND NUMBER SECURED PARTY COLLATERAL DESCRIPTION
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
Dallas Texas JUD 12/13/1983 Kathy Keown $11.00
02436935
- -----------------------------------------------------------------------------------------------------------------------------------
Brazoria Texas JUD 05/01/1995 Southwest Sids $3,046.00
15284A Research Institute
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 09/07/1989 First Choice Bank Specified Leases
002618815
- -----------------------------------------------------------------------------------------------------------------------------------
Cook Illinois STL 02/03/1993 Internal Revenue Service $9,237.00
93086377
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois STL 02/01/1993 Internal Revenue Service $9,237.00
16752
- -----------------------------------------------------------------------------------------------------------------------------------
Cook Illinois JUD 01/28/1993 American President Lines $541.00
92M1 183263
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 05/25/1989 Chrysler Systems Leasing Inc. Specified Leases
002579304
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 07/28/1989 Chrysler Systems Leasing Inc. Specified Leases
002603793
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 09/14/1989 Chrysler Systems Leasing Inc. Specified Leases
002621470
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
10
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
JURISDICTION SERVICE FILE DATE AND NUMBER SECURED PARTY COLLATERAL DESCRIPTION
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State of Illinois UCC 05/14/1991 Chrysler Systems Leasing Inc. Specified Leases, Leased
002850766 Equipment, and Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 07/11/1991 Chrysler Systems Leasing Inc. Specified Leases, Leased
002871555 Equipment, and Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 03/24/1992 Chrysler Systems Leasing Inc. Specified Leases, Leased
002964746 Equipment, and Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 08/11/1992 Chrysler Systems Leasing Inc. Specified Leases, Leased
003018576 Computer Equipment
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 04/23/1998 Fleet Capital Corp as Agent Leased Equipment, Leased
003839606 Computer Equipment and
Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 03/07/1984 General Electric Credit Corp Specified Leases
001844628
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 03/07/1984 General Electric Credit Corp Specified Leases
001844648
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 12/19/1998 General Electric Credit Corp Specified Leases, Leased
002512367 Equipment, Specified
Chattel Paper, Including
Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
11
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
JURISDICTION SERVICE FILE DATE AND NUMBER SECURED PARTY COLLATERAL DESCRIPTION
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State of Illinois UCC 12/19/1998 General Electric Credit Corp Specified Equipment,
002512368 Leased Equipment,
Vehicles, Including
Proceeds and Products
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 07/07/1994 IBM Corp Specified Equipment,
00328788 Specified Computer
Equipment and Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 08/10/1990 Pitney Bowes Credit Group Specified Leases, Specified
002749733 Equipment and Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 01/10/1985 QRZX Leasing Co Inc., DBA Specified Leases
001952699 Great Western Leasing
- -----------------------------------------------------------------------------------------------------------------------------------
Du Page Illinois JUD 04/10/1995 Peggy J. Wilson $15,689.00
95AR 572
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 06/13/1984 Irving Abrams There are no proceedings
J553928 pending to enforce any
judgment in connection
with this case. The
Borrower will determine
and report to the
Administrative Agent the
status of this case.
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
12
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
JURISDICTION SERVICE FILE DATE AND NUMBER SECURED PARTY COLLATERAL DESCRIPTION
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 06/01/1998 Acosta Albert $7,883.00
700733
- -----------------------------------------------------------------------------------------------------------------------------------
Tarrant Texas JUD 05/26/1988 Other Party; Allied Van Lines Inc. $1,157.00
00346213
- -----------------------------------------------------------------------------------------------------------------------------------
Jefferson Texas JUD 03/17/1995 Anthony Walters Settled
B151307
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 11/10/1995 Charles D. Morgan Settled
56164
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 08/10/1993 Cotton Moving & Storage Inc. Settled
9341347334
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 07/15/1993 CYD D. Dillahunty Settled
60913
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 12/21/1995 Dale Glass MD Settled
9561390
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
13
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
JURISDICTION SERVICE FILE DATE AND NUMBER SECURED PARTY COLLATERAL DESCRIPTION
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
Smith Texas JUD 08/02/1996 Daniel Bruce Groves There are no proceedings
39225 pending to enforce any
judgment in connection
with this case. The
Borrower will determine
and report to the
Administrative Agent the
status of this case.
- -----------------------------------------------------------------------------------------------------------------------------------
Bexar Texas JUD 08/03/1993 Deborah Jamail Judgment Satisfied
210/610
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 01/11/1994 Gary Allen Jackson $5,000.00
940134961
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 07/02/1984 Other Party; Houston NW There are no proceedings
J582963 Aviation Inc. pending to enforce any
judgment in connection
with this case. The
Borrower will determine
and report to the
Administrative Agent the
status of this case.
- -----------------------------------------------------------------------------------------------------------------------------------
Galveston Texas JUD 05/30/1997 Hugh House et al $12,400.00
SC6699
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
14
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
JURISDICTION SERVICE FILE DATE AND NUMBER SECURED PARTY COLLATERAL DESCRIPTION
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
McLennan Texas JUD 11/28/1994 Lawrence E. Greenwood Settled
9442073
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 01/12/1996 Michael D. Rowland et al Settled
9601741
- -----------------------------------------------------------------------------------------------------------------------------------
Galveston Texas JUD 03/09/1994 Murray Reynolds $10,000.00
94CV0247
- -----------------------------------------------------------------------------------------------------------------------------------
Harris Texas JUD 03/08//1995 Murray Reynolds $10,000.00
951202955
- -----------------------------------------------------------------------------------------------------------------------------------
Montgomery Texas JUD 07/21/1993 Paul Baraai $195,770.00
930702080CV
- -----------------------------------------------------------------------------------------------------------------------------------
Dallas Texas JUD 01/07/1980 Other Party; Allied Van Lines Inc. $1,588.20
00052195
- -----------------------------------------------------------------------------------------------------------------------------------
Dallas Texas JUD 08/30/1979 Other Party; Allied Van Lines Inc. $1,588.20
01715428
- -----------------------------------------------------------------------------------------------------------------------------------
Hidalgo Texas JUD 12/12/1994 Scott Breittenwischer Settled
CL25359D
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 07/18/1989 AT&T Credit Corp Specified Leases
002599620
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
15
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
JURISDICTION SERVICE FILE DATE AND NUMBER SECURED PARTY COLLATERAL DESCRIPTION
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 09/01/1989 AT&T Credit Corp Specified Leases
002617239
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 12/04/1989 AT&T Credit Corp Specified Leases
002652035
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 03/20/1989 Capital Associates International Specified Leases
002549280 Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 04/10/1989 Chrysler Systems Leasing Inc. Specified Leases
002558544
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 11/20/1989 Chrysler Systems Leasing Inc. Specified Leases
002647161
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 03/24/1992 Chrysler Systems Leasing Inc. Specified Leases, Leased
002964745 Equipment and Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 03/21/1990 COM - L 1989-B Corp Specified Leases, Leased
002693221 Business
Machinery/Equipment and
Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 09/20/1989 Comdisco Inc. Specified Leases
002624073 (computer printers)
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 02/07/1989 Mt. Greenwood Bank Specified Leases
002533035
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Charee/SafecoBonds
16
<PAGE>
SAFECO BONDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
JURISDICTION SERVICE FILE DATE AND NUMBER SECURED PARTY COLLATERAL DESCRIPTION
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
State of Illinois UCC 06/27/1989 Mid-States Financial Corp. Specified Leases, Leased
002591956 Equipment and Proceeds
- -----------------------------------------------------------------------------------------------------------------------------------
Dallas Texas JUD 05/25/1994 Charlie Nzeakor $2,000.00
29400079N
- -----------------------------------------------------------------------------------------------------------------------------------
State of Texas UCC 06/01/1999 MCI Capital Services Specified accounts
9900106189 receivable
- -----------------------------------------------------------------------------------------------------------------------------------
State of Texas UCC 10/10/1995 Home Juice Co. Specified Equipment
003455490 (Cafeteria Equipment)
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
UCC = UCC STL = State Tax Lien FTL = Federal Tax Lien JUD = Judgment Lien
Charee/SafecoBonds
17
<PAGE>
Exhibit 10.4
CONFORMED COPY
================================================================================
GUARANTEE AND COLLATERAL AGREEMENT
made by
NA HOLDING CORPORATION,
NORTH AMERICAN VAN LINES, INC.
and certain of its Subsidiaries
in favor of
THE CHASE MANHATTAN BANK,
as Collateral Agent and Administrative Agent
Dated as of November 19, 1999
================================================================================
<PAGE>
GUARANTEE AND COLLATERAL AGREEMENT
GUARANTEE AND COLLATERAL AGREEMENT, dated as of November 19, 1999,
made by NORTH AMERICAN VAN LINES, INC., a Delaware corporation (the "Parent
Borrower"), certain foreign subsidiaries of the Parent Borrower from time to
time parties to the Credit Agreement referred to below (the "Foreign Subsidiary
Borrowers"; together with the Parent Borrower, the "Borrowers"), NA HOLDING
CORPORATION, a Delaware corporation ("Holding"), and each of the other
signatories hereto (together with the Borrowers, Holding and any other Domestic
Subsidiary of the Parent Borrower that becomes a party hereto from time to time
after the date hereof, collectively, the "Granting Parties"; individually, a
"Granting Party"), in favor of THE CHASE MANHATTAN BANK, as collateral agent and
administrative agent (in such capacities, the "Administrative Agent") for the
banks and other financial institutions (collectively, the "Lenders";
individually, a "Lender") from time to time parties to the Credit Agreement,
dated as of November 19, 1999 (as amended, waived, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among the Borrowers, the
Lenders, The Bank of New York, as documentation agent, Banc of America
Securities LLC, as syndication agent (in such capacity, the "Syndication
Agent"), and the Administrative Agent.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have
severally agreed to make extensions of credit to the Borrowers upon the terms
and subject to the conditions set forth therein;
WHEREAS, it is a condition to the obligation of the Lenders to make
their respective extensions of credit to the Borrowers under the Credit
Agreement that the Granting Parties shall execute and deliver this Agreement to
the Administrative Agent for the benefit of the Lenders;
WHEREAS, the proceeds of the extensions of credit under the Credit
Agreement will be used in part to enable the Borrowers to make valuable
transfers to one or more of the other Granting Parties in connection with the
operation of their respective businesses; and
WHEREAS, the Borrowers and the other Granting Parties are engaged in
related businesses, and each such Granting Party will derive substantial direct
and indirect benefit from the making of the extensions of credit under the
Credit Agreement;
NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the
Borrowers thereunder, each Granting Party hereby agrees with the Administrative
Agent, for the ratable benefit of the Secured Parties (as defined below), as
follows:
SECTION 1. DEFINED TERMS
<PAGE>
2
1.1 Definitions. (a) Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement, and the following terms which are defined in the Code (as
defined below) are used herein as so defined: Certificated Security, Chattel
Paper, Documents, Equipment, Farm Products, Fixtures, General Intangibles,
Instruments and Inventory.
(b) The following terms shall have the following meanings:
"Accounts": all accounts (as defined in the Code) of the Grantors,
including, without limitation, all Accounts (as defined in the Credit
Agreement) of the Grantors, but in any event excluding all Accounts that
have been sold or otherwise transferred in connection with a Permitted
Receivables Securitization.
"Administrative Agent": as defined in the Preamble hereto.
"Agreement": this Guarantee and Collateral Agreement, as the same
may be amended, waived, supplemented or otherwise modified from time to
time.
"Borrower Obligations": with respect to any Borrower, the collective
reference to the unpaid principal of and interest on the Loans and
Reimbursement Obligations and all other obligations and liabilities of
such Borrower (including, without limitation, interest accruing at the
then applicable rate provided in the Credit Agreement after the maturity
of such Borrower's Loans and Reimbursement Obligations and interest
accruing at the then applicable rate provided in the Credit Agreement
after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to such Borrower,
whether or not a claim for post-filing or post-petition interest is
allowed in such proceeding) to the Administrative Agent or any Lender (or,
in the case of any Lender Hedge Agreement, any affiliate of any Lender),
whether direct or indirect, absolute or contingent, due or to become due,
or now existing or hereafter incurred, which may arise under, out of, or
in connection with, the Credit Agreement, this Agreement, the other Loan
Documents, any Letter of Credit, any letter of credit referred to in
subsection 8.2(k) of the Credit Agreement issued by any Lender or any
affiliate of any Lender, any Guarantee Obligations of such Borrower or any
of its Subsidiaries referred to in subsection 8.4(b) of the Credit
Agreement as to which any Lender or any affiliate thereof is a
beneficiary, any Lender Hedge Agreement or any other document made,
delivered or given in connection therewith, in each case whether on
account of principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation,
all fees and disbursements of counsel to the Administrative Agent or to
the Lenders that are required to be paid by such Borrower pursuant to the
terms of any of the foregoing agreements).
"Borrowers": as defined in the Preamble hereto.
"Code": the Uniform Commercial Code as from time to time in effect
in the State of New York.
<PAGE>
3
"Collateral": as defined in Section 3.1, subject to the exclusions
of Section 3.3.
"Collateral Account Bank": The Chase Manhattan Bank or another bank
which at all times is a Lender as selected by the relevant Grantor and
notified to the Administrative Agent in writing promptly following such
selection.
"Collateral Proceeds Account": the cash collateral account
established by the relevant Grantor at an office of the Collateral Account
Bank in the name of the Administrative Agent.
"Commitments": the collective reference to: (i) the Revolving Credit
Commitments, (ii) the obligation of each Tranche A Term Loan Lender and
each Tranche B Term Loan Lender, respectively, to make a Tranche A Term
Loan and a Tranche B Term Loan, respectively, to the Parent Borrower
pursuant to subsection 2.6 of the Credit Agreement, (iii) the Swing Line
Commitment and (iv) the obligation of the Issuing Lender to issue Letters
of Credit to any Borrower pursuant to subsection 3.1 of the Credit
Agreement.
"Contracts": with respect to any Grantor, the contracts, agreements,
instruments and indentures listed on Schedule 8, as the same may from time
to time be amended, waived, supplemented or otherwise modified, including,
without limitation, (i) all rights of such Grantor to receive moneys due
and to become due to it thereunder or in connection therewith, (ii) all
rights of such Grantor to damages arising thereunder and (iii) all rights
of such Grantor to perform and to exercise all remedies thereunder.
"Copyright Licenses": with respect to any Grantor, all United States
written license agreements of such Grantor with any Person who is not an
Affiliate or a Subsidiary providing for the grant by or to such Grantor of
any right to use any Copyright of such Grantor, including, without
limitation, the license agreements listed on Schedule 5 subject, in each
case, to the terms of such license agreements, and the right to prepare
for sale, sell and advertise for sale, all Inventory now or hereafter
covered by such licenses.
"Copyrights": with respect to any Grantor, all of such Grantor's
right, title and interest in and to all United States copyrights, whether
or not the underlying works of authorship have been published or
registered, United States copyright registrations and copyright
applications, including, without limitation, the copyright registrations
listed on Schedule 5, and (a) all renewals thereof, (b) all income,
royalties, damages and payments now and hereafter due and/or payable with
respect thereto, including, without limitation, payments under all
licenses entered into in connection therewith, and damages and payments
for past, present or future infringements thereof and (c) the right to sue
or otherwise recover for past, present and future infringements thereof.
"Credit Agreement": as defined in the Preamble hereto.
"Foreign Subsidiary Borrowers": as defined in the Preamble hereto.
<PAGE>
4
"General Fund Account": the general fund account of the relevant
Grantor established at the same office of the Collateral Account Bank as
the Collateral Proceeds Account.
"Granting Party" and "Granting Parties": as defined in the Preamble
hereto.
"Grantor": the Borrowers and each Subsidiary of the Borrower that,
from time to time, becomes a party hereto.
"Guarantor Obligations": with respect to any Guarantor, all
obligations and liabilities of such Guarantor which may arise under or in
connection with this Agreement (including, without limitation, Section 2)
or any other Loan Document to which such Guarantor is a party, in each
case whether on account of guarantee obligations, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including,
without limitation, all fees and disbursements of counsel to the
Administrative Agent, to the Other Representatives or to the Lenders that
are required to be paid by such Guarantor pursuant to the terms of this
Agreement or any other Loan Document).
"Guarantors": the collective reference to each Granting Party other
than the Foreign Subsidiary Borrowers and any Foreign Subsidiary Holdco.
"Holding": as defined in the Preamble hereto.
"Intellectual Property": with respect to any Grantor, the collective
reference to such Grantor's Copyrights, Copyright Licenses, Patents,
Patent Licenses, Trade Secrets, Trademarks and Trademark Licenses.
"Intercompany Note": with respect to any Grantor, any promissory
note in a principal amount in excess of $1,000,000 evidencing loans made
by such Grantor to Holding, or any of its Subsidiaries.
"Investment Property": the collective reference to: (i) all
"investment property" as such term is defined in Section 9-115 of the
Uniform Commercial Code in effect in the State of New York on the date
hereof, and (ii) whether or not constituting "investment property" as so
defined, all Pledged Securities.
"IP Collateral": with respect to any Grantor, the collective
reference to such Grantor's Patents, Patent Licenses, Trademarks,
Trademark Licenses, General Intangibles connected with the use of or
symbolized by the Trademarks and Patents and, to the extent not otherwise
included, all Proceeds and products of any and all of the foregoing and
all collateral security and guarantees given by any Person with respect to
any of the foregoing.
"Issuers": the collective reference to the Persons identified on
Schedule 2 as the issuers of a Pledged Security.
"Lender" and "Lenders": as defined in the Preamble hereto.
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5
"Lender Hedge Agreements": as to any Grantor, all interest rate
swaps, caps or collar agreements or similar arrangements entered into by
such Person with any Lender (or any affiliate of any Lender) providing for
protection against fluctuations in interest rates or currency exchange
rates or the exchange of nominal interest obligations, either generally or
under specific contingencies, including, without limitation, all Interest
Rate Protection Agreements and Permitted Hedging Arrangements.
"Obligations": (i) in the case of each Borrower, its Borrower
Obligations, and (ii) in the case of each Guarantor, its Guarantor
Obligations.
"Parent Borrower": as defined in the Preamble hereto.
"Patent Licenses": with respect to any Grantor, all United States
written license agreements of such Grantor with any Person who is not an
Affiliate or a Subsidiary concerning any of the Patents of such Grantor or
such other Person's patents, whether such Grantor is a licensor or a
licensee under any such agreement, including, without limitation, the
license agreements listed on Schedule 5, subject, in each case, to the
terms of such license agreements, and the right to prepare for sale, sell
and advertise for sale, all Inventory now or hereafter covered by such
licenses.
"Patents": with respect to any Grantor, all of such Grantor's right,
title and interest in and to all United States patents, patent
applications and patentable inventions, including, without limitation, all
patents and patent applications identified in Schedule 5, and including,
without limitation, (a) all inventions and improvements described and
claimed therein, (b) the right to sue or otherwise recover for any and all
past, present and future infringements thereof, (c) all income, royalties,
damages and other payments now and hereafter due and/or payable with
respect thereto (including, without limitation, payments under all
licenses entered into in connection therewith, and damages and payments
for past, present or future infringements thereof) and (d) all other
rights corresponding thereto in the United States and all reissues,
divisions, continuations, continuations-in-part, substitutes, renewals,
and extensions thereof, all improvements thereon, and all other rights of
any kind whatsoever of such Grantor accruing thereunder or pertaining
thereto.
"Pledged Collateral": as defined in Section 3.2(b), subject to the
exclusions of Section 3.3.
"Pledged Notes": with respect to any Pledgor, (i) all Intercompany
Notes at any time issued to such Pledgor and (ii) each other promissory
note in a principal amount in excess of $1,000,000 issued to or held by
such Pledgor (other than, in the case of this clause (ii), promissory
notes issued in connection with extensions of trade credit by any Pledgor
in the ordinary course of business) including, without limitation, all
such notes listed on Schedule 2.
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6
"Pledged Securities": the collective reference to the Pledged Notes
and the Pledged Stock.
"Pledged Stock": with respect to any Pledgor, the shares of Capital
Stock listed on Schedule 2 as held by such Pledgor, provided that in no
event shall there be pledged, nor shall any Pledgor be required to pledge,
directly or indirectly, (x) any Capital Stock of any Subsidiary other than
a Material Subsidiary or (y) more than 65% of any series of the
outstanding Capital Stock of any Foreign Subsidiary or Foreign Subsidiary
Holdco pursuant to this Agreement.
"Pledgor": Holding (with respect to Pledged Stock of the Parent
Borrower), the Parent Borrower (with respect to Pledged Stock of each
Material Subsidiary that is a Domestic Subsidiary, each Foreign Subsidiary
Borrower and each Foreign Subsidiary Holdco and any other Pledged
Securities held by the Parent Borrower) and any other Granting Party (with
respect to Pledged Securities held by such Granting Party).
"Premium Fund Trust Account ": a fiduciary account maintained by an
insurance agency into which premium moneys held for the benefit of others
related to insurance policies maintained in the ordinary course of
business of the policy holder are deposited.
"Proceeds": all "proceeds" as such term is defined in Section
9-306(1) of the Uniform Commercial Code in effect in the State of New York
on the date hereof and, in any event, Proceeds of Pledged Securities shall
include, without limitation, all dividends or other income from the
Pledged Securities, collections thereon or distributions or payments with
respect thereto.
"Receivable": any right to payment for goods sold or leased or for
services rendered, whether or not such right is evidenced by an Instrument
or Chattel Paper and whether or not it has been earned by performance,
including, without limitation, any Account.
"Secured Parties": the collective reference to (a) the
Administrative Agent, (b) the Syndication Agent, (c) the Lenders
(including, without limitation, the Issuing Lender and the Swing Line
Lender), (d) each Lender or any affiliate of such Lender which has entered
into any Lender Hedge Agreement with any of the Borrowers or any of their
Subsidiaries, issued any letter of credit referred to in subsection 8.2(k)
of the Credit Agreement, or is the beneficiary of any Guarantee Obligation
referred to in subsection 8.4(b) of the Credit Agreement and (e) the
successors and assigns of any of the foregoing.
"Security Collateral": as defined in Section 3.2, subject to the
exclusions of Section 3.3.
"Subsidiary Guarantor": each Material Subsidiary of the Parent
Borrower other than any Insurance Subsidiary, MSS, any Foreign Subsidiary
and any Foreign Subsidiary Holdco.
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7
"Syndication Agent": as defined in the Preamble hereto.
"Trademark Licenses": with respect to any Grantor, all United States
written license agreements of such Grantor with any Person who is not an
Affiliate or a Subsidiary concerning any of the Trademarks of such Grantor
or such other Person's names or trademarks, whether such Grantor is a
licensor or a licensee under any such agreement, including, without
limitation, the license agreements listed on Schedule 5, subject, in each
case, to the terms of such license agreements, and the right to prepare
for sale, sell and advertise for sale, all Inventory now or hereafter
covered by such licenses.
"Trademarks": with respect to any Grantor, all of such Grantor's
right, title and interest in and to all United States trademarks, service
marks, trade names, trade dress or other indicia of trade origin or
business identifiers, trademark and service mark registrations, and
applications for trademark or service mark registrations (except for
"intent to use" applications for trademark or service mark registrations
filed pursuant to Section 1(b) of the Lanham Act, 15 U.S.C. Section 1051,
unless and until an Amendment to Allege Use or a Statement of Use under
Sections 1(c) and 1(d) of said Act has been filed), and any renewals
thereof, including, without limitation, each registration and application
identified in Schedule 5, and including, without limitation, (a) the right
to sue or otherwise recover for any and all past, present and future
infringements or dilutions thereof, (b) all income, royalties, damages and
other payments now and hereafter due and/or payable with respect thereto
(including, without limitation, payments under all licenses entered into
in connection therewith, and damages and payments for past, present or
future infringements thereof) and (c) all other rights corresponding
thereto and all other rights of any kind whatsoever of such Grantor
accruing thereunder or pertaining thereto, together in each case with the
goodwill of the business connected with the use of, and symbolized by,
each such trademark, service mark, trade name, trade dress or other
indicia of trade origin or business identifiers.
"Trade Secrets": with respect to any Grantor, all of such Grantor's
right, title and interest in and to all United States trade secrets,
including, without limitation, know-how, processes, formulae,
compositions, designs, and confidential business and technical
information, and all rights of any kind whatsoever accruing thereunder or
pertaining thereto, including, without limitation, (a) all income,
royalties, damages and payments now and hereafter due and/or payable with
respect thereto, including, without limitation, payments under all
licenses, non-disclosure agreements and memoranda of understanding entered
into in connection therewith, and damages and payments for past, present
or future misappropriations thereof and (b) the right to sue or otherwise
recover for past, present or future misappropriations thereof.
"Vehicles": all cars, trucks, trailers, construction and earth
moving equipment and other vehicles covered by a certificate of title law
of Indiana or Illinois and all tires and other appurtenances to any of the
foregoing.
1.2 Other Definitional Provisions. (a) The words "hereof", "herein",
"hereto" and "hereunder" and words of similar import when used in this Agreement
shall refer to this
<PAGE>
8
Agreement as a whole and not to any particular provision of this Agreement, and
Section, Schedule and Annex references are to this Agreement unless otherwise
specified.
(b The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(c Where the context requires, terms relating to the Collateral,
Pledged Collateral or Security Collateral, or any part thereof, when used in
relation to a Granting Party shall refer to such Granting Party's Collateral,
Pledged Collateral or Security Collateral or the relevant part thereof.
(d All references in this Agreement to any of the property described
in the definition of the term "Collateral" or "Pledged Collateral", or to any
Proceeds thereof, shall be deemed to be references thereto only to the extent
the same constitute Collateral or Pledged Collateral, respectively.
SECTION 2. GUARANTEE
2.1 Guarantee. (a) Each of the Guarantors hereby, jointly and
severally, unconditionally and irrevocably, guarantees to the Administrative
Agent, for the ratable benefit of the Secured Parties and their respective
successors, indorsees, transferees and assigns, the prompt and complete payment
and performance by each Borrower when due and payable (whether at the stated
maturity, by acceleration or otherwise) of the Borrower Obligation of such
Borrower.
(b Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under the
other Loan Documents shall in no event exceed the amount which can be guaranteed
by such Guarantor under applicable law, including applicable federal and state
laws relating to the insolvency of debtors (after giving effect to the right of
contribution established in Section 2.2).
(c Each Guarantor agrees that the total amount of Borrower
Obligations may at any time and from time to time exceed the amount of the
liability of such Guarantor hereunder without impairing the guarantee contained
in this Section 2 or affecting the rights and remedies of the Administrative
Agent or any other Secured Party hereunder.
(d The guarantee contained in this Section 2 shall remain in full
force and effect until the earlier to occur of (i) the first date on which all
the Loans, any Reimbursement Obligations, all other Borrower Obligations then
due and owing, and the obligations of each Guarantor under the guarantee
contained in this Section 2 then due and owing shall have been satisfied by
payment in full in cash, no Letter of Credit shall be outstanding and the
Commitments shall be terminated, notwithstanding that from time to time during
the term of the Credit Agreement any of the Borrowers may be free from any
Borrower Obligations or (ii) as to any Guarantor, the sale or other disposition
of all of the Capital Stock of such Guarantor permitted under the Credit
Agreement.
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9
(e No payment made by any of the Borrowers, any of the Guarantors,
any other guarantor or any other Person or received or collected by the
Administrative Agent or any other Secured Party from any of the Borrowers, any
of the Guarantors, any other guarantor or any other Person by virtue of any
action or proceeding or any set-off or appropriation or application at any time
or from time to time in reduction of or in payment of any of the Borrower
Obligations shall be deemed to modify, reduce, release or otherwise affect the
liability of any Guarantor hereunder which shall, notwithstanding any such
payment (other than any payment made by such Guarantor in respect of any of the
Borrower Obligations or any payment received or collected from such Guarantor in
respect of any of the Borrower Obligations), remain liable for each of the
Borrower Obligations up to the maximum liability of such Guarantor hereunder
until the earlier to occur of (i) the first date on which all the Loans, any
Reimbursement Obligations, and all other Borrower Obligations then due and owing
are paid in full in cash, no Letter of Credit shall be outstanding and the
Commitments are terminated or (ii) the sale or other disposition of all of the
Capital Stock of such Guarantor permitted under the Credit Agreement.
2.2 Right of Contribution. Each Subsidiary Guarantor hereby agrees
that to the extent that a Subsidiary Guarantor shall have paid more than its
proportionate share of any payment made hereunder, such Subsidiary Guarantor
shall be entitled to seek and receive contribution from and against any other
Subsidiary Guarantor hereunder which has not paid its proportionate share of
such payment. Each Subsidiary Guarantor's right of contribution shall be subject
to the terms and conditions of Section 2.3. The provisions of this Section 2.2
shall in no respect limit the obligations and liabilities of any Subsidiary
Guarantor to the Administrative Agent and the other Secured Parties, and each
Subsidiary Guarantor shall remain liable to the Administrative Agent and the
other Secured Parties for the full amount guaranteed by such Subsidiary
Guarantor hereunder.
2.3 No Subrogation. Notwithstanding any payment made by any
Guarantor hereunder or any set-off or application of funds of any Guarantor by
the Administrative Agent or any other Secured Party, no Guarantor shall be
entitled to be subrogated to any of the rights of the Administrative Agent or
any other Secured Party against any of the Borrowers or any other Guarantor or
any collateral security or guarantee or right of offset held by the
Administrative Agent or any other Secured Party for the payment of any of the
Borrower Obligations, nor shall any Guarantor seek or be entitled to seek any
contribution or reimbursement from any of the Borrowers or any other Guarantor
in respect of payments made by such Guarantor hereunder, until all amounts owing
to the Administrative Agent and the other Secured Parties by each of the
Borrowers on account of its Borrower Obligations are paid in full in cash, no
Letter of Credit shall be outstanding and the Commitments are terminated. If any
amount shall be paid to any Guarantor on account of such subrogation rights at
any time when all of the Borrower Obligations shall not have been paid in full
in cash, such amount shall be held by such Guarantor in trust for the
Administrative Agent and the other Secured Parties, segregated from other funds
of such Guarantor, and shall, forthwith upon receipt by such Guarantor, be
turned over to the Administrative Agent in the exact form received by such
Guarantor (duly indorsed by such Guarantor to the Administrative Agent, if
required), to be held as collateral security for all of the Borrower Obligations
(whether matured or unmatured) guaranteed by such Guarantor and/or then or at
any time thereafter may be applied against any Borrower Obligations, whether
matured or unmatured, in such order as the Administrative Agent may determine.
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10
2.4 Amendments, etc. with respect to the Borrower Obligations. To
the maximum extent permitted by applicable law, each Guarantor shall remain
obligated hereunder notwithstanding that, without any reservation of rights
against any Guarantor and without notice to or further assent by any Guarantor,
any demand for payment of any of the Borrower Obligations made by the
Administrative Agent or any other Secured Party may be rescinded by the
Administrative Agent or such other Secured Party and any of the Borrower
Obligations continued, and any of the Borrower Obligations, or the liability of
any other Person upon or for any part thereof, or any collateral security or
guarantee therefor or right of offset with respect thereto, may, from time to
time, in whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by the Administrative Agent or any
other Secured Party, and the Credit Agreement and the other Loan Documents and
any other documents executed and delivered in connection therewith may be
amended, waived, modified, supplemented or terminated, in whole or in part, as
the Administrative Agent (or the Required Lenders and/or such other requisite
percentage of the Lenders as is required pursuant to subsection 11.1 of the
Credit Agreement, as the case may be) may deem advisable from time to time, and
any collateral security, guarantee or right of offset at any time held by the
Administrative Agent or any other Secured Party for the payment of any of the
Borrower Obligations may be sold, exchanged, waived, surrendered or released.
Neither the Administrative Agent nor any other Secured Party shall have any
obligation to protect, secure, perfect or insure any Lien at any time held by it
as security for any of the Borrower Obligations or for the guarantee contained
in this Section 2 or any property subject thereto, except to the extent required
by applicable law.
2.5 Guarantee Absolute and Unconditional. Each Guarantor waives, to
the maximum extent permitted by applicable law, any and all notice of the
creation, renewal, extension or accrual of any of the Borrower Obligations and
notice of or proof of reliance by the Administrative Agent or any other Secured
Party upon the guarantee contained in this Section 2 or acceptance of the
guarantee contained in this Section 2; each of the Borrower Obligations, and any
obligation contained therein, shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance
upon the guarantee contained in this Section 2; and all dealings between any of
the Borrowers and any of the Guarantors, on the one hand, and the Administrative
Agent and the other Secured Parties, on the other hand, likewise shall be
conclusively presumed to have been had or consummated in reliance upon the
guarantee contained in this Section 2. Each Guarantor waives, to the maximum
extent permitted by applicable law, diligence, presentment, protest, demand for
payment and notice of default or nonpayment to or upon any of the Borrowers or
any of the other Guarantors with respect to any of the Borrower Obligations.
Each Guarantor understands and agrees, to the extent permitted by applicable
law, that the guarantee contained in this Section 2 shall be construed as a
continuing, absolute and unconditional guarantee of payment. Each Guarantor
hereby waives, to the maximum extent permitted by applicable law, any and all
defenses that it may have arising out of or in connection with any and all of
the following: (a) the validity or enforceability of the Credit Agreement or any
other Loan Document, any of the Borrower Obligations or any other collateral
security therefor or guarantee or right of offset with respect thereto at any
time or from time to time held by the Administrative Agent or any other Secured
Party, (b) any defense, set-off or counterclaim (other than a defense of payment
or performance) which may at any time be
<PAGE>
11
available to or be asserted by any of the Borrowers against the Administrative
Agent or any other Secured Party, (c) any change in the time, place, manner or
place of payment, amendment, or waiver or increase in any of the Obligations,
(d) any exchange, taking, or release of Collateral, (e) any change in the
corporate structure or existence of any of the Borrowers, (f) any application of
Collateral to any of the Obligations in accordance with the terms of this
Agreement or (g) any other circumstance whatsoever, other than indefeasible
payment in full in cash of all Borrower Obligations, which (with or without
notice to or knowledge of any of the Borrowers or such Guarantor) constitutes,
or might be construed to constitute, an equitable or legal discharge of any of
the Borrowers for its Borrower Obligations, or of such Guarantor under the
guarantee contained in this Section 2, in bankruptcy or in any other instance.
When making any demand hereunder or otherwise pursuing its rights and remedies
hereunder against any Guarantor, the Administrative Agent or any other Secured
Party may, but shall be under no obligation to, make a similar demand on or
otherwise pursue such rights and remedies as it may have against any of the
Borrowers, any other Guarantor or any other Person or against any collateral
security or guarantee for any of the Borrower Obligations or any right of offset
with respect thereto, and any failure by the Administrative Agent or any other
Secured Party to make any such demand, to pursue such other rights or remedies
or to collect any payments from any of the Borrowers, any other Guarantor or any
other Person or to realize upon any such collateral security or guarantee or to
exercise any such right of offset, or any release of any of the Borrowers, any
other Guarantor or any other Person or any such collateral security, guarantee
or right of offset, shall not relieve any Guarantor of any obligation or
liability hereunder, and shall not impair or affect the rights and remedies,
whether express, implied or available as a matter of law, of the Administrative
Agent or any other Secured Party against any Guarantor. For the purposes hereof
"demand" shall include the commencement and continuance of any legal
proceedings.
2.6 Reinstatement. The guarantee contained in this Section 2 shall
continue to be effective, or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any of the Borrower Obligations is rescinded or
must otherwise be restored or returned by the Administrative Agent or any other
Secured Party upon the insolvency, bankruptcy, dissolution, liquidation or
reorganization of any Borrower or any Guarantor, or upon or as a result of the
appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, any Borrower or any Guarantor or any substantial part of its
property, or otherwise, all as though such payments had not been made.
2.7 Payments. Each Guarantor hereby guarantees that payments
hereunder will be paid to the Administrative Agent without set-off or
counterclaim in Dollars at the office of the Administrative Agent located at 270
Park Avenue, New York, New York 10017 or such other address of the
Administrative Agent as may be designated to the Parent Borrower and such
Guarantor from time to time in accordance with subsection 11.2 of the Credit
Agreement.
SECTION 3. GRANT OF SECURITY INTEREST
3.1 Collateral. Subject to Section 3.3, each Granting Party that is
a Grantor hereby grants to the Administrative Agent, for the ratable benefit of
the Secured Parties, a security interest in all of the following property (or
their equivalent in the applicable foreign country, in the case of Foreign
Subsidiary Borrowers) now owned or at any time hereafter
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12
acquired by such Grantor or in which such Grantor now has or at any time in the
future may acquire any right, title or interest (collectively, the
"Collateral"), as collateral security for the prompt and complete payment and
performance when due (whether at the stated maturity, by acceleration or
otherwise) of the Obligations of such Grantor:
(a all Accounts;
(b all Chattel Paper;
(c all Contracts;
(d all Documents;
(e all Equipment;
(f all General Intangibles;
(g all Instruments;
(h all Intellectual Property;
(i all Inventory;
(j all Vehicles;
(k the Collateral Proceeds Account;
(l from and after the date a security interest therein may be
perfected by the filing of financing statements under the Uniform
Commercial Code, commercial tort claims;
(m all books and records pertaining to any of the foregoing; and
(n to the extent not otherwise included, all Proceeds and products
of any and all of the foregoing and all collateral security and guarantees
given by any Person with respect to any of the foregoing;
provided that, in the case of each Grantor, Collateral shall not include any
Pledged Collateral, or any property or assets specifically excluded from Pledged
Collateral (including any Capital Stock of any Foreign Subsidiary or Foreign
Subsidiary Holdco in excess of 65% of any series of such stock); and provided,
further, that, for the avoidance of doubt, the security interest granted herein
by any Grantor that is a Foreign Subsidiary Borrower shall not secure any
Obligations other than the Obligations of such Foreign Subsidiary Borrower.
3.2 Pledged Collateral. (a) Subject to Section 3.3, each Granting
Party that is a Pledgor hereby grants to the Administrative Agent, for the
ratable benefit of the Secured Parties, a security interest in all of the
Pledged Securities and other Investment Property now owned or at
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13
any time hereafter acquired by such Pledgor, and any Proceeds thereof, as
collateral security for the prompt and complete performance when due (whether at
the stated maturity, by acceleration or otherwise) of the Obligations of such
Pledgor; (the Collateral (if any) and the Pledged Collateral (if any) of any
Granting Party being collectively referred to herein as such Granting Party's
"Security Collateral"); provided that Pledged Collateral shall not include any
Capital Stock of any Foreign Subsidiary or Foreign Subsidiary Holdco in excess
of 65% of any series of such stock to the extent that any Obligations are
secured by such security interest (except as provided in paragraph (b)), but
shall include Investment Property in the nature of Capital Stock of a Domestic
Subsidiary that is not a Material Subsidiary.
(b Each Granting Party that is a Pledgor and is a Foreign Subsidiary
Borrower hereby grants to the Administrative Agent, for the ratable benefit of
the Secured Parties, a security interest in 100% of the Capital Stock of each
Material Subsidiary now owned or at any time hereafter acquired by such Pledgor,
and any Proceeds thereof (together with the Pledged Securities and Investment
Property and Proceeds thereof referred to in subsection 3.2(a), the "Pledged
Collateral"), as collateral security for the prompt and complete performance
when due (whether at the stated maturity, by acceleration or otherwise) of the
Borrower Obligations of such Foreign Subsidiary Borrower; provided that, for the
avoidance of doubt, the security interest granted herein by any Pledgor that is
a Foreign Subsidiary Borrower shall not secure any Obligations other than the
Obligations of such Foreign Subsidiary Borrower.
3.3 Certain Exceptions. No security interest is or will be granted
pursuant hereto in (and the terms Collateral, Pledged Collateral and Security
Collateral shall not include) the right, title and interest of any Granting
Party under or in:
(a any Instruments, Contracts, Chattel Paper, General Intangibles,
Investment Property, Copyright Licenses, Patent Licenses, Trademark
Licenses or other contracts or agreements with or issued by Persons other
than a Subsidiary of Holding (collectively, "Excluded Agreements") that
would otherwise be included in the Security Collateral (and such Excluded
Agreements shall not be deemed to constitute a part of the Security
Collateral) for so long as, and to the extent that, the granting of such a
security interest pursuant hereto would result in a breach, default or
termination of such Excluded Agreements;
(b any Equipment that would otherwise be included in the Security
Collateral (and such Equipment shall not be deemed to constitute a part of
the Security Collateral) if such Equipment is subject to a Lien permitted
by subsection 8.3(h) or (o) of the Credit Agreement;
(c any property that would otherwise be included in Security
Collateral that has been sold or otherwise transferred in a Permitted
Receivables Securitization or that is subject to any Lien permitted under
subsection 8.3(m) of the Credit Agreement or constitutes the Proceeds or
products of any property that has been so sold or otherwise transferred;
or
(d any amounts that may be maintained in a Premium Fund Trust
Account.
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14
SECTION 4. REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of Each Guarantor. To induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the
Borrowers thereunder, each Guarantor hereby represents and warrants to the
Administrative Agent and each other Secured Party that the representations and
warranties set forth in Section 5 of the Credit Agreement as they relate to such
Guarantor or to the Loan Documents to which such Guarantor is a party, each of
which representations and warranties is hereby incorporated herein by reference,
are true and correct in all material respects, and the Administrative Agent and
each other Secured Party shall be entitled to rely on each of such
representations and warranties as if fully set forth herein; provided that each
reference in each such representation and warranty to the Parent Borrower's
knowledge shall, for the purposes of this Section 4.1, be deemed to be a
reference to such Guarantor's knowledge.
4.2 Representations and Warranties of Each Grantor. To induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the
Borrowers thereunder, each Grantor hereby represents and warrants to the
Administrative Agent and each other Secured Party that:
4.2.1 Title; No Other Liens. Except for the security interests
granted to the Administrative Agent, for the ratable benefit of the Secured
Parties, pursuant to this Agreement and the other Liens permitted to exist on
such Grantor's Collateral by the Credit Agreement (including without limitation
subsection 8.3 thereof), such Grantor owns each material item of such Grantor's
Collateral free and clear of any and all Liens. Except as set forth on Schedule
6, no financing statement or other similar public notice with respect to all or
any part of such Grantor's Collateral is on file or of record in any public
office, except such as have been filed in favor of the Administrative Agent, for
the ratable benefit of the Secured Parties, pursuant to this Agreement or as are
permitted by the Credit Agreement (including without limitation subsection 8.3
thereof) or any other Loan Document or for which termination statements will be
delivered on the Effective Date.
4.2.2 Perfected First Priority Liens. (i) This Agreement is
effective to create, as collateral security for the Obligations of such Grantor,
valid and enforceable Liens on such Grantor's Collateral in favor of the
Administrative Agent, for the benefit of the Secured Parties, except as
enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditor's rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing.
(ii) Except with regard to Liens (if any) on Specified Assets, upon
the completion of the Filings, and the delivery to and continuing possession by
the Administrative Agent of all Instruments, Chattel Paper and Documents, a
security interest in which is perfected by possession, the Liens created
pursuant to this Agreement will constitute valid Liens on and (to the extent
<PAGE>
15
provided herein) perfected security interests in such Grantor's Collateral in
favor of the Administrative Agent for the benefit of the Secured Parties, and
will be prior to all other Liens of all other Persons other than Permitted
Liens, and which Liens are enforceable as such as against all other Persons
other than Ordinary Course Buyers, except to the extent that (a) the recording
of applicable documents in the United States Patent and Trademark Office or the
United States Copyright Office may be necessary for perfection or
enforceability, (b) the certificate of title for any Vehicle has not been
retitled with the motor vehicle department of the state in which such Vehicle is
titled to notate the Lien thereon in favor of the Administrative Agent and (c)
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law) or by an implied
covenant of good faith and fair dealing. As used in this Section 4.2.2(ii), the
following terms shall have the following meanings:
"Filings": the filing or recording of the Financing Statements, the
Mortgages, and this Agreement as set forth in subsection 5.14 of the
Credit Agreement, and any filings after the Effective Date in any other
jurisdiction as may be necessary under any Requirement of Law.
"Financing Statements": the financing statements delivered to the
Administrative Agent by each Grantor on the Effective Date for filing in
the jurisdictions listed on Schedule 5.14 to the Credit Agreement (which
Financing Statements are in proper form for filing in such jurisdictions).
"Ordinary Course Buyers": with respect to goods only, buyers in the
ordinary course of business to the extent provided in Section 9-307(1) of
the Uniform Commercial Code as in effect from time to time in the
applicable jurisdiction.
"Permitted Liens": Liens permitted pursuant to the Loan Documents,
including without limitation, those permitted to exist pursuant to
subsection 8.3 of the Credit Agreement.
"Specified Assets": the following property and assets of each
Grantor:
(1) Equipment constituting Fixtures;
(2) Patents, Patent Licenses, Trademarks and Trademark Licenses to
the extent that (a) Liens thereon cannot be perfected by the filing of
financing statements under the Uniform Commercial Code or by the filing
and acceptance thereof in the United States Patent and Trademark Office or
(b) such Patents, Patent Licenses, Trademarks and Trademark Licenses are
not, individually or in the aggregate, material to the business of the
Parent Borrower and its Subsidiaries taken as a whole;
(3) Copyrights and Copyright Licenses and Accounts or Receivables
arising therefrom only to the extent that the Uniform Commercial Code as
in effect from time to
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16
time in the relevant jurisdiction is not applicable to the creation or
perfection of Liens thereon;
(4) uncertificated securities;
(5) Collateral for which the perfection of Liens thereon requires
filings in or other actions under the laws of jurisdictions outside of the
United States of America, any State, territory or dependency thereof or
the District of Columbia;
(6) Contracts, Accounts or Receivables on which the United States of
America or any department, agency or instrumentality thereof is the
Obligor, and property or assets subject to any rights reserved in favor of
the United States government as required under law;
(7) goods included in Collateral received by any Person for "sale or
return" within the meaning of Section 2-326 of the Uniform Commercial Code
of the applicable jurisdiction, to the extent of claims of creditors of
such Person;
(8) Proceeds of Accounts, Receivables or Inventory until transferred
to or deposited in the Collateral Proceeds Account; and
(9) Equipment at various sales offices with a fair market value of
less than $10,000 per sales office and mobile goods.
4.2.3 Chief Executive Office. On the date hereof, such Grantor's
jurisdiction of organization and the location of such Grantor's chief executive
office or sole place of business are specified on Schedule 3.
4.2.4 Inventory and Equipment. On the date hereof, such Grantor's
Inventory and Equipment (other than equipment at various sales offices with a
fair market value of less than $10,000 per sales office and mobile goods) are
kept at the locations listed on Schedule 4.
4.2.5 Farm Products. None of such Grantor's Collateral constitutes,
or is the Proceeds of, Farm Products.
4.2.6 Receivables. (i) The amounts represented by such Grantor to
the Administrative Agent or the other Secured Parties from time to time as owing
by each account debtor or by all account debtors in respect of such Grantor's
Receivables constituting Security Collateral will at such time be the correct
amount, in all material respects, actually owing by such account debtor or
debtors thereunder, except to the extent that appropriate reserves therefor have
been established on the books of such Grantor in accordance with GAAP.
(ii) The places where such Grantor keeps its records concerning such
Grantor's Receivables constituting Security Collateral are listed on Schedule 7
or such other location or locations of which such Grantor shall have provided
prior written notice to the Administrative Agent pursuant to Section 5.2.5
hereof.
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17
(iii) Unless otherwise indicated in writing to the Administrative
Agent, each Receivable constituting Security Collateral of such Grantor arises
out of a bona fide sale and delivery of goods or rendition of services by such
Grantor.
(iv) Such Grantor has not given any account debtor any deduction in
respect of the amount due under any such Account, except in the ordinary course
of business or as such Grantor may otherwise advise the Administrative Agent in
writing.
4.2.7 Intellectual Property. Schedule 5 lists all material United
States patents, patent applications, trademark registrations, trademark
applications, copyright registrations and copyright applications owned by such
Grantor in its own name as of the date hereof and all material Trademark
Licenses, Patent Licenses and Copyright Licenses to which such Grantor is a
party on the date hereof. Except as set forth on Schedule 5, on the date hereof:
(i) each patent, patent application, trademark registration,
trademark application, copyright registration and copyright application of such
Grantor set forth on Schedule 5 is subsisting, has not been adjudged invalid,
unregisterable or unpatentable, as the case may be, or unenforceable in any
respect that would reasonably be expected to have a Material Adverse Effect and
to the best of such Grantor's knowledge, is valid, registerable or patentable,
as the case may be, and enforceable; and
(ii) no claim has been made and is continuing or, to the knowledge
of such Grantor, threatened that the use by such Grantor of any item of IP
Collateral is invalid or unenforceable or that the use by such Grantor of any IP
Collateral does or may violate the rights of any Person, which would have a
Material Adverse Effect. To such Grantor's knowledge, there is currently no
infringement or unauthorized use of any item of IP Collateral contained on
Schedule 5 hereto which would have a Material Adverse Effect.
4.2.8 Contracts. (i) No consent of any party (other than such
Grantor) to any of such Grantor's Contracts is required, or purports to be
required, in connection with the execution, delivery and performance of this
Agreement.
(ii) Each of such Grantor's Contracts is in full force and effect
and constitutes a valid and legally enforceable obligation of such Grantor and,
to such Grantor's knowledge, each of the other parties thereto, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
(iii) No consent or authorization of, filing with or other act by or
in respect of any Governmental Authority is required in connection with the
execution, delivery, performance, validity or enforceability of any of such
Grantor's Contracts by such Grantor or, to such Grantor's knowledge, any other
party thereto, other than those which have been duly obtained, made or
performed, or where the failure to have obtained such consent or authorization
or to make such filing or take such action, would not reasonably be expected to
result in a Material Adverse Effect.
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18
(iv) Neither such Grantor nor (to the best of such Grantor's
knowledge) any of the other parties to such Grantor's Contracts is in default in
any material respect in the performance or observance of any of the terms
thereof.
(v) The right, title and interest of such Grantor in, to and under
such Grantor's Contracts are not subject to any material defenses, offsets,
counterclaims or claims.
(vi) Such Grantor has delivered to the Administrative Agent a
complete and correct copy of each of such Grantor's Contracts, including all
amendments, supplements and other modifications thereto.
4.2.9 Vehicles. Schedule 9 is a list of all Vehicles owned by such
Grantor on the date hereof which is accurate in all material respects. The
aggregate book value as of the date hereof of all vehicles owned by any Grantor
and that are registered in a jurisdiction other than the State of Indiana or the
State of Illinois is $963,064.
4.3 Representations and Warranties of Each Pledgor. To induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the
Borrowers thereunder, each Pledgor hereby represents and warrants to the
Administrative Agent and each other Secured Party that:
4.3.1 (a) The shares of Pledged Stock pledged by such Pledgor
hereunder constitute (i) in the case of Pledged Stock constituting Capital Stock
of any Domestic Subsidiary, all the issued and outstanding shares of all classes
of the Capital Stock of each such Domestic Subsidiary owned by such Pledgor,
(ii) in the case of any Pledgor that is a Foreign Subsidiary Borrower, all the
issued and outstanding shares of all classes of the Capital Stock of any
Subsidiary owned by such Pledgor and (iii) in the case of any Pledged Stock
constituting Capital Stock of Foreign Subsidiary Holdco or any Foreign
Subsidiary not covered by clause (ii), such percentage (not more than 65%) as is
specified on Schedule 2 of all the issued and outstanding shares of all classes
of the Capital Stock of each such Foreign Subsidiary Holdco and each such
Foreign Subsidiary owned by such Pledgor.
4.3.2 All the shares of the Pledged Stock pledged by such Pledgor
hereunder have been duly and validly issued and are fully paid and
nonassessable.
4.3.3 Each of the Intercompany Notes pledged by such Pledgor
hereunder constitutes the legal, valid and binding obligation of the obligor
with respect thereto, enforceable in accordance with its terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
4.3.4 Such Pledgor is the record and beneficial owner of, and has
good title to, the Pledged Securities pledged by it hereunder, free of any and
all Liens or options in favor of, or
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19
claims of, any other Person, except the security interest created by this
Agreement and Liens arising by operation of law or permitted by the Credit
Agreement.
4.3.5 Upon delivery to the Administrative Agent of the certificates
evidencing the Pledged Securities held by such Pledgor, together with duly
executed stock or bond powers or other instruments of transfer, the security
interest created by this Agreement in such Pledged Collateral, assuming the
continuing possession of such Pledged Securities by the Administrative Agent,
will constitute a valid, perfected first priority security interest in such
Pledged Collateral to the extent provided in the Code, enforceable in accordance
with its terms against all creditors of such Pledgor and any persons purporting
to purchase such Pledged Collateral from such Pledgor, except as enforceability
may be affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing.
4.3.6 Upon the filing of financing statements in the appropriate
jurisdiction under the Code, the security interest created by this Agreement in
such Pledged Securities that constitute uncertificated securities, will
constitute a valid, perfected first priority security interest in such Pledged
Securities constituting uncertificated securities to the extent provided in and
governed by the Code, enforceable in accordance with its terms against all
creditors of such Pledgor and any persons purporting to purchase such Pledged
Securities from such Pledgor, except as enforceability may be affected by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding equity or at law) and
an implied covenant of good faith and fair dealing.
SECTION 5. COVENANTS
5.1 Covenants of Each Guarantor. Each Guarantor covenants and agrees
with the Administrative Agent and the other Secured Parties that, from and after
the date of this Agreement until the earlier to occur of (i) the date upon which
the Loans, any Reimbursement Obligations, and all other Obligations then due and
owing shall have been paid in full in cash, no Letter of Credit shall be
outstanding and the Commitments shall have terminated, or (ii) as to any
Guarantor the date upon which all the Capital Stock of such Guarantor shall have
been sold or otherwise disposed of in accordance with the terms of the Credit
Agreement, such Guarantor shall take, or shall refrain from taking, as the case
may be, each action that is necessary to be taken or not taken, as the case may
be, so that no Default or Event of Default is caused by the failure to take such
action or to refrain from taking such action by such Guarantor or any of its
Subsidiaries.
5.2 Covenants of Each Grantor. Each Grantor covenants and agrees
with the Administrative Agent and the other Secured Parties that, from and after
the date of this Agreement until the earlier to occur of (i) the date upon which
the Loans, any Reimbursement Obligations, and all other Obligations then due and
owing shall have been paid in full in cash, no Letter of Credit shall be
outstanding and the Commitments shall have terminated, or (ii) as to any
Guarantor to the date upon which all the Capital Stock of such Guarantor shall
have been sold or otherwise disposed of in accordance with the terms of the
Credit Agreement:
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20
5.2.1 Delivery of Instruments and Chattel Paper. If any amount
payable under or in connection with any of such Grantor's Collateral shall be or
become evidenced by any Instrument or Chattel Paper, except as provided in the
following sentence, such Grantor shall be entitled to retain possession of all
Collateral of such Grantor evidenced by any Instrument or Chattel Paper, and
shall hold all such Collateral in trust for the Administrative Agent, for the
ratable benefit of the Secured Parties. In the event that an Event of Default
shall have occurred and be continuing, upon the request of the Administrative
Agent, such Instrument or Chattel Paper shall be promptly delivered to the
Administrative Agent, duly indorsed in a manner satisfactory to the
Administrative Agent, to be held as Collateral pursuant to this Agreement. Such
Grantor shall not permit any other Person to possess any such Collateral at any
time other than in connection with any Permitted Receivables Securitization or
any Disposition of such Collateral in a transaction permitted by the Credit
Agreement.
5.2.2 Maintenance of Insurance. (i) Such Grantor will maintain, with
financially sound and reputable companies, insurance policies (a) insuring such
Grantor's Inventory, Equipment and Vehicles against loss by fire, explosion,
theft and such other casualties as are usually insured against by companies
engaged in the same or a similar business and (b) insuring such Grantor, the
Administrative Agent and the other Secured Parties against liability for
personal injury and property damage relating to such Inventory, Equipment and
Vehicles, such policies to be in such amounts and covering at least such risks
as are usually insured against by companies engaged in the same or a similar
business.
(ii) All such insurance shall (a) provide that no cancellation,
material reduction in amount or material change in coverage thereof shall be
effective until at least 15 days after receipt by the Administrative Agent of
written notice thereof, (b) name the Administrative Agent as an additional
insured party or loss payee and (c) include deductibles consistent with past
practice or otherwise consistent with industry practice or otherwise reasonably
satisfactory to the Administrative Agent.
(iii) Such Grantor (limited solely to the Parent Borrower) shall
deliver to the Administrative Agent and the other Secured Parties reports of one
or more reputable insurance brokers of the individual insurance companies with
respect to such insurance as the Administrative Agent may from time to time
reasonably request.
5.2.3 Payment of Obligations. Such Grantor will pay and discharge or
otherwise satisfy at or before maturity or before they become delinquent, as the
case may be, all material taxes, assessments and governmental charges or levies
imposed upon such Grantor's Collateral or in respect of income or profits
therefrom, as well as all material claims of any kind (including, without
limitation, material claims for labor, materials and supplies) against or with
respect to such Grantor's Collateral, except that no such tax, assessment,
charge or levy need be paid or satisfied if the amount or validity thereof is
currently being contested in good faith by appropriate proceedings and reserves
in conformity with GAAP with respect thereto have been provided on the books of
such Grantor.
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21
5.2.4 Maintenance of Perfected Security Interest; Further
Documentation. (i) Such Grantor shall maintain the security interest created by
this Agreement in such Grantor's Collateral as a perfected security interest
having at least the priority described in Section 4.2.2 and shall defend such
security interest against the claims and demands of all Persons whomsoever.
(ii) Such Grantor will furnish to the Administrative Agent from time
to time statements and schedules further identifying and describing such
Grantor's Collateral and such other reports in connection with such Grantor's
Collateral as the Administrative Agent may reasonably request in writing, all in
reasonable detail.
(iii) At any time and from time to time, upon the written request of
the Administrative Agent, and at the sole expense of such Grantor, such Grantor
will promptly and duly execute and deliver such further instruments and
documents and take such further actions as the Administrative Agent may
reasonably request for the purpose of obtaining or preserving the full benefits
of this Agreement and of the rights and powers herein granted by such Grantor,
including, without limitation, the filing of any financing or continuation
statements under the Uniform Commercial Code (or other similar laws) in effect
in any jurisdiction with respect to the security interests created hereby.
5.2.5 Changes in Locations, Name, etc. Such Grantor will not, except
upon not less than 10 days' prior written notice to the Administrative Agent and
delivery to the Administrative Agent, if applicable, of a written supplement to
Schedule 4 showing any additional location at which such Grantor's Inventory or
Equipment shall be kept:
(i) permit any of such Grantor's Inventory or Equipment to be kept
at a location other than the location(s) applicable to such Grantor listed
on Schedule 4 (other than (A) Inventory or Equipment being conveyed, sold,
leased, assigned, transferred or otherwise disposed of as permitted by the
Credit Agreement, (B) equipment at various sales offices with a fair
market value of less than $10,000 per sales office and (C) mobile goods);
(ii) change the location of its chief executive office or sole place
of business from that referred to in Section 4.2.3; or
(iii) change its name, identity or corporate structure to such an
extent that any financing statement filed by the Administrative Agent in
connection with this Agreement would become misleading;
provided that, prior to taking any such action, or promptly after receiving a
written request therefor from the Administrative Agent, such Grantor shall
deliver to the Administrative Agent all additional executed financing statements
and other documents reasonably requested by the Administrative Agent to maintain
the validity, perfection and priority of the security interests provided for
herein.
5.2.6 Notices. Such Grantor will advise the Administrative Agent
promptly, in reasonable detail, of:
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22
(i) any Lien (other than security interests created hereby or Liens
permitted under the Credit Agreement) on any of such Grantor's Collateral which
would adversely affect the ability of the Administrative Agent to exercise any
of its remedies hereunder; and
(ii) of the occurrence of any other event which would reasonably be
expected to have a material adverse effect on the aggregate value of such
Grantor's Collateral or on the security interests created hereby.
5.2.7 Pledged Securities. In the case of each Grantor which is an
Issuer, such Issuer agrees that (i) it will be bound by the terms of this
Agreement relating to the Pledged Securities issued by it and will comply with
such terms insofar as such terms are applicable to it, (ii) it will notify the
Administrative Agent promptly in writing of the occurrence of any of the events
described in Section 5.3.1 with respect to the Pledged Securities issued by it
and (iii) the terms of Sections 6.3(c) and 6.7 shall apply to it, mutatis
mutandis, with respect to all actions that may be required of it pursuant to
Section 6.3(c) or 6.7 with respect to the Pledged Securities issued by it.
5.2.8 Receivables. (i) Other than in the ordinary course of business
or as expressly permitted by the Loan Documents, such Grantor will not (a) grant
any extension of the time of payment of any of such Grantor's Receivables, (b)
compromise or settle any such Receivable for less than the full amount thereof,
(c) release, wholly or partially, any Person liable for the payment of any
Receivable or (d) allow any credit or discount whatsoever on any such Receivable
unless such extensions, compromises, settlements, releases, credits or discounts
would not reasonably be expected to materially adversely affect the value of the
Receivables constituting Collateral taken as a whole.
(ii) Such Grantor will deliver to the Administrative Agent a copy of
each material demand, notice or document received by it that questions or calls
into doubt the validity or enforceability of more than 10% of the aggregate
amount of the then outstanding Receivables.
5.2.9 Maintenance of Records. Such Grantor will keep and maintain at
its own cost and expense reasonably satisfactory and complete records of its
Collateral, including, without limitation, a record of all payments received and
all credits granted with respect to such Collateral, and shall mark such records
to evidence this Agreement and the Liens and the security interests created
hereby. For the Administrative Agent's and the other Secured Parties' further
security, the Administrative Agent, for the benefit of the Secured Parties,
shall have a security interest in all of such Grantor's books and records
pertaining to such Grantor's Collateral.
5.2.10 Intellectual Property. (i) Such Grantor agrees that, should
it obtain an ownership interest in any material (x) registration of Copyright,
Patent or Trademark or (y) any exclusive rights under a material Copyright
License, Patent License or Trademark License which is not now a part of the
Collateral, (A) the provisions of Section 3 shall automatically apply thereto,
(B) any such Copyright, Copyright License, Patent, Patent License, Trademark or
Trademark License shall automatically become part of the Collateral, and (C)
with respect to any ownership interest in any such Copyright, Copyright License,
Patent, Patent License, Trademark or Trademark License that such Grantor should
obtain, it shall give notice thereof to the
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23
Administrative Agent in writing, in reasonable detail, at its address set forth
in the Credit Agreement within 45 days after the end of the calendar quarter in
which it obtains such ownership interest. Such Grantor authorizes the
Administrative Agent to modify this Agreement by amending Schedule 5 (and will
cooperate reasonably with the Administrative Agent in effecting any such
amendment) to include on Schedule 5 any Copyright, Copyright License, Patent,
Patent License, Trademark or Trademark License of which it receives notice under
this Section, or to prepare and file with the United States Patent and Trademark
Office or the United States Copyright Office a supplement to this Agreement to
include any Copyright, Patent or Trademark of which it receives notice under
this Section.
(ii) Except as permitted in the Loan Documents, such Grantor agrees
to take all reasonably necessary steps, including, without limitation, in the
United States Patent and Trademark Office or in any court, to (A) maintain each
trademark registration and each Trademark License identified on Schedule 5, and
(B) pursue each trademark application now or hereafter identified on Schedule 5,
including, without limitation, the filing of responses to office actions issued
by the United States Patent and Trademark Office, the filing of applications for
renewal, the filing of affidavits under Sections 8 and 15 of the United States
Trademark Act, and the participation in opposition, cancellation, infringement
and dilution proceedings, except, in each case in which such Grantor has
reasonably determined that any of the foregoing is not of material economic
value to it. Such Grantor agrees to take corresponding steps with respect to
each new or acquired trademark or service mark registration, or application for
trademark or service mark registration, or any rights obtained under any
Trademark License, in each case, to which it is now or later becomes entitled,
except in each case in which such Grantor has reasonably determined that any of
the foregoing is not of material economic value to it. Any expenses incurred in
connection with such activities shall be borne by such Grantor.
(iii) Except as permitted in the Loan Documents, such Grantor agrees
to take all necessary steps, including, without limitation, in the United States
Patent and Trademark Office or in any court, to (A) maintain each patent and
each Patent License identified on Schedule 5, and (B) pursue each patent
application, now or hereafter identified on Schedule 5, including, without
limitation, the filing of divisional, continuation, continuation-in-part and
substitute applications, the filing of applications for reissue, renewal or
extensions, the payment of maintenance fees, and the participation in
interference, reexamination, opposition or infringement and misappropriation
proceedings, except, in each case in which such Grantor has reasonably
determined that any of the foregoing is not of material economic value to it.
Such Grantor agrees to take corresponding steps with respect to each new or
acquired patent, patent application, or any rights obtained under any Patent
License, in each case, to which it is now or later becomes entitled, except in
each case in which such Grantor has reasonably determined that any of the
foregoing is not of material economic value to it. Any expenses incurred in
connection with such activities shall be borne by such Grantor.
(iv) Except as provided in subsection (v) hereof, such Grantor shall
take all additional steps not set forth in subsections (ii) and (iii) hereof
which it or the Administrative Agent deems reasonably appropriate under the
circumstances to preserve and protect its material Patents, Patent Licenses,
Trademarks, and Trademark Licenses.
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(v) Such Grantor shall not abandon any trademark registration,
patent or any pending trademark or patent application, in each case listed on
Schedule 5, without the written consent of the Administrative Agent, unless such
Grantor shall have previously determined that such use or the pursuit or
maintenance of such trademark registration, patent or pending trademark or
patent application is not of material economic value to it, in which case, such
Grantor will, at least annually, give notice of any such abandonment to the
Administrative Agent in writing, in reasonable detail, at its address set forth
in the Credit Agreement.
(vi) In the event that any Grantor becomes aware that any item of IP
Collateral which such Grantor has reasonably determined to be material to its
business is infringed or misappropriated by a third party, which infringement or
misappropriation would reasonably be expected to have a Material Adverse Effect,
such Grantor shall notify the Administrative Agent promptly and in writing, in
reasonable detail, at its address set forth in the Credit Agreement, and shall
take such actions as such Grantor or the Administrative Agent deems reasonably
appropriate under the circumstances to protect such IP Collateral, including,
without limitation, suing for damages and/or for an injunction against such
infringement or misappropriation. Any expense incurred in connection with such
activities shall be borne by such Grantor. Such Grantor will advise the
Administrative Agent promptly and in writing, in reasonable detail, at its
address set forth in the Credit Agreement, of any adverse determination or the
institution of any proceeding (including, without limitation, the institution of
any proceeding in the United States Patent and Trademark Office or any court)
regarding any item of the IP Collateral which could reasonably result in a
Material Adverse Effect.
(vii) Such Grantor shall mark its products with the trademark
registration symbol -Registered Trademark-, the numbers of all appropriate
patents, the common law trade mark symbol -TM-, or the designation "patent
pending," as the case may be, to the extent that it is reasonably and
commercially practicable.
(viii) Such Grantor will not create, incur or permit to exist, will
defend the IP Collateral against, and will take such other action as is
reasonably necessary to remove, any material Lien or material adverse claim on
or to any of the IP Collateral other than Liens created hereby and other than as
permitted pursuant to the Loan Documents (including, without limitation, any
Liens permitted to exist on the IP Collateral pursuant to subsection 8.3 of the
Credit Agreement), and will defend the right, title and interest of the
Administrative Agent and the other Secured Parties in and to any of the IP
Collateral against the claims and demands of all Persons whomsoever, except
where failure to defend would not have a Material Adverse Effect.
(ix) Without the prior written consent of the Administrative Agent,
such Grantor will not sell, assign, transfer, exchange, license or otherwise
dispose of or grant any option with respect to, the IP Collateral or the
Software License Agreement, by and between Norfolk Southern Corporation, NS
Transportation Brokerage Corporation and the Parent Borrower, or attempt, offer
or contract to do so, except with respect to licenses in the ordinary course of
business or as permitted by this Agreement or the other Loan Documents.
(x) Such Grantor will advise the Administrative Agent promptly and
in writing, in reasonable detail, at its address set forth in the Credit
Agreement, (A) of any Lien (other than
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25
Liens created hereby or permitted under the Loan Documents, including, without
limitation, any Liens permitted to exist on the IP Collateral pursuant to
subsection 8.3 of the Credit Agreement) on any IP Collateral and (B) of the
occurrence of any other event which would reasonably be expected in the
aggregate to have a material adverse effect on the aggregate value of the IP
Collateral as a whole or the Liens created hereunder.
5.2.11 Protection of Trade Secrets. Such Grantor shall take all
commercially reasonable steps to preserve and protect the secrecy of all
material Trade Secrets of such Grantor.
5.2.12 Contracts. Such Grantor will perform and comply in all
material respects with such Grantor's obligations under its Contracts.
5.2.13 Vehicles. (i) Without the prior written consent of the
Administrative Agent, no certificate of title for any Vehicle shall be
surrendered to any Person other than the Administrative Agent unless such
surrender is (A) made to the motor vehicle department of the state in which such
Vehicle is registered in connection with the notation thereon of the Lien in
favor of the Administrative Agent or in connection with the administration
thereof so long as no adverse effect on such notation shall result therefrom,
(B) in connection with such Vehicle being registered in another jurisdiction if,
after giving effect to such registration, the aggregate book value of all
vehicles owned by the Grantors and registered in a jurisdiction other than the
State of Indiana would not exceed $5,000,000, and all applications for a
certificate of title indicating the Administrative Agent's first priority
security interest in such Vehicle and any other necessary documentation have
been or, contemporaneously with such surrender, will be filed in each office in
each such other jurisdiction which the Administrative Agent shall reasonably
deem advisable to continue the perfection of its security interest in such
Vehicle or (C) in connection with the Disposition of such Vehicle in a
transaction permitted by the Credit Agreement.
(ii) Within 30 days after the date hereof, and, with respect to any
Vehicles acquired by such Grantor subsequent to the date hereof, within 30 days
after the date of acquisition thereof, all applications for certificates of
title indicating the Administrative Agent's first priority security interest in
the Vehicle covered by such certificate, and any other necessary documentation,
shall be filed in each office in each jurisdiction which the Administrative
Agent shall reasonably deem advisable to perfect its security interests in such
Vehicles.
(iii) Until such time as all certificates of title for Vehicles
owned by the Parent Borrower and each other Granting Party have been delivered
to the Administrative Agent, the Parent Borrower shall furnish, no later then 45
days after the end of each quarterly period of each fiscal year of the Borrower,
to the Administrative Agent a report that sets forth as of the last day of such
quarter (the "Reporting Date"):
(a) a list of all Vehicles in which the Administrative Agent has a
security interest hereunder;
(b) a list of all Vehicles in which a security interest was granted
hereunder and for which the certificates of title have been modified,
since the last Reporting Date, in such a way as to terminate the
Administrative Agent's security interest in such Vehicles, together
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26
with a brief description of the Disposition of such Vehicles that sets
forth, for each such Vehicle, the reason for such Disposition and the
Proceeds received by the Parent Borrower or any other Granting Party in
connection with such Disposition; and
(c) the aggregate book value of all vehicles that, (1) as of the
Reporting Date, are owned by the Parent Borrower or any other Granting
Party and (2) are titled or registered in a jurisdiction other than the
State of Indiana or the State of Illinois.
5.3 Covenants of Each Pledgor. Each Pledgor covenants and agrees
with the Administrative Agent and the other Secured Parties that, from and after
the date of this Agreement until the earlier to occur of (i) the Loans, any
Reimbursement Obligations, and all other Obligations then due and owing shall
have been paid in full in cash, no Letter of Credit shall be outstanding and the
Commitments shall have terminated, or (ii) as to any Pledgor the date upon which
all the Capital Stock of such Pledgor shall have been sold or otherwise disposed
of in accordance with the terms of the Credit Agreement:
5.3.1 If such Pledgor shall become entitled to receive or shall
receive any certificate (including, without limitation, any certificate
representing a stock dividend or a distribution in connection with any
reclassification, increase or reduction of capital or any certificate issued in
connection with any reorganization), option or similar rights in respect of the
Capital Stock of any Issuer, whether in addition to, in substitution of, as a
conversion of, or in exchange for, any shares of the Pledged Stock, or otherwise
in respect thereof, such Pledgor shall, except as otherwise permitted by
subsection 8.9(m) of the Credit Agreement, accept the same as the agent of the
Administrative Agent and the other Secured Parties, hold the same in trust for
the Administrative Agent and the other Secured Parties and deliver the same
forthwith to the Administrative Agent in the exact form received, duly indorsed
by such Pledgor to the Administrative Agent, if required, together with an
undated stock power covering such certificate duly executed in blank by such
Pledgor and with, if the Administrative Agent so requests, signature guaranteed,
to be held by the Administrative Agent, subject to the terms hereof, as
additional collateral security for the Obligations (provided that in no event
shall there be pledged, nor shall any Pledgor be required to pledge, more than
65% of any series of the outstanding Capital Stock of any Foreign Subsidiary or
any Foreign Subsidiary Holdco pursuant to this Agreement, in each case, to the
extent that the Parent Borrower's Obligations are secured by such pledge). Any
sums paid upon or in respect of the Pledged Securities upon the liquidation or
dissolution of any Issuer (except any liquidation or dissolution of any
Subsidiary of a Borrower in accordance with the Credit Agreement) shall be paid
over to the Administrative Agent to be held by it hereunder as additional
collateral security for the Obligations, and in case any distribution of capital
shall be made on or in respect of the Pledged Securities or any property shall
be distributed upon or with respect to the Pledged Securities pursuant to the
recapitalization or reclassification of the capital of any Issuer or pursuant to
the reorganization thereof, the property so distributed shall, unless otherwise
subject to a perfected security interest in favor of the Administrative Agent,
be delivered to the Administrative Agent to be held by it hereunder as
additional collateral security for the Obligations. If any sums of money or
property so paid or distributed in respect of the Pledged Securities shall be
received by such Pledgor, such Pledgor shall, until such money or property is
paid or delivered to the Administrative Agent, hold such money or property in
trust
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27
for the Secured Parties, segregated from other funds of such Pledgor, as
additional collateral security for the Obligations.
5.3.2 Without the prior written consent of the Administrative Agent,
such Pledgor will not (except pursuant to the Credit Agreement and the
Indentures, or as permitted by the Credit Agreement) (i) vote to enable, or take
any other action to permit, any Issuer to issue any stock or other equity
securities of any nature or to issue any other securities convertible into or
granting the right to purchase or exchange for any stock or other equity
securities of any nature of any Issuer, (ii) sell, assign, transfer, exchange,
or otherwise dispose of, or grant any option with respect to, the Pledged
Securities or Proceeds thereof, (iii) create, incur or permit to exist any Lien
or option in favor of, or any material adverse claim of any Person with respect
to, any of the Pledged Securities or Proceeds thereof, or any interest therein,
except for the security interests created by this Agreement or Liens arising by
operation of law or (iv) enter into any agreement or undertaking restricting the
right or ability of such Pledgor or the Administrative Agent to sell, assign or
transfer any of the Pledged Securities or Proceeds thereof.
5.3.3 Such Pledgor shall maintain the security interest created by
this Agreement in such Pledgor's Pledged Collateral as a perfected security
interest having at least the priority described in Section 4.3.5 and shall
defend such security interest against the claims and demands of all Persons
whomsoever. At any time and from time to time, upon the written request of the
Administrative Agent, and at the sole expense of such Pledgor, such Pledgor will
promptly and duly execute and deliver such further instruments and documents and
take such further actions as the Administrative Agent may reasonably request for
the purpose of obtaining or preserving the full benefits of this Agreement and
of the rights and powers herein granted by such Pledgor.
5.4 Covenants of Holding. Holding covenants and agrees with the
Administrative Agent and the other Secured Parties that, from and after the date
of this Agreement until the Loans, any Reimbursement Obligations, and all other
Obligations then due and owing shall have been paid in full in cash, no Letter
of Credit shall be outstanding and the Commitments shall have terminated:
5.4.1 Capital Contributions to the Parent Borrower. Immediately upon
receipt of the cash proceeds of any Asset Sale or any incurrence of Indebtedness
for borrowed money (other than Indebtedness permitted pursuant to Section
5.4.2(ii) hereof), Holding shall make a capital contribution to the Parent
Borrower of all of such cash proceeds, on terms and conditions reasonably
satisfactory to the Administrative Agent.
5.4.2 Limitation on Activities of Holding. Notwithstanding anything
to the contrary in this Agreement or any other Loan Document:
(i) conduct, transact or otherwise engage in, or commit to conduct,
transact or otherwise engage in, any business or operations other than (a)
the provision of administrative, legal, accounting and management services
to or on behalf of any of its Subsidiaries, (b) those incidental to its
ownership of the Capital Stock of the Parent Borrower or other ownership
interests in its Subsidiaries, including the Parent Borrower, the sale and
transfer of such ownership interests (to the extent not otherwise
prohibited
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28
by any of the Loan Documents), and the exercise of rights and performance
of obligations in connection therewith, (c) the entry into, and the
exercise of rights and performance of obligations in respect of, (A) the
Transaction Documents, this Agreement and any other Loan Document to which
Holding is a party, and any Indebtedness or other obligations permitted to
be incurred by it pursuant to the Loan Documents, in each case as amended,
supplemented, waived or otherwise modified from time to time, and any
refinancings, refundings, renewals or extensions thereof, (B) contracts
and agreements with officers, directors and employees of Holding or a
Subsidiary thereof relating to their employment or directorships, (C)
insurance policies and related contracts and agreements, and (D) equity
subscription agreements, registration rights agreements, voting and other
stockholder agreements, engagement letters, underwriting agreements and
other agreements in respect of its equity securities or any offering,
issuance or sale thereof, including but not limited to in respect of the
Management Subscription Agreements, (d) the offering, issuance, sale and
repurchase or redemption of, and dividends or distributions on, its equity
securities (to the extent not otherwise prohibited by any of the Loan
Documents), (e) the filing of registration statements, and compliance with
applicable reporting and other obligations, under federal, state or other
securities laws, (f) the listing of its equity securities and compliance
with applicable reporting and other obligations in connection therewith,
(g) the retention of (and the entry into, and the exercise of rights and
performance of obligations in respect of, contracts and agreements with)
transfer agents, private placement agents, underwriters, counsel,
accountants and other advisors and consultants, (h) the performance of
obligations under and compliance with its certificate of incorporation and
by-laws, or any applicable law, ordinance, regulation, rule, order,
judgment, decree or permit, including, without limitation, as a result of
or in connection with the activities of its Subsidiaries, (i) the
incurrence and payment of its operating and business expenses and any
taxes for which it may be liable, (j) the making of loans to or other
Investments in, or incurrence of Indebtedness to, its Subsidiaries (to the
extent not otherwise prohibited by any of the Loan Documents), (k) the
ownership of, and the exercise of rights and performance of obligations in
respect of, Intellectual Property and foreign patents, trademarks, trade
names, copyrights, technology, know-how and processes and licensing such
Intellectual Property and foreign patents, trademarks, trade names,
copyrights, technology, know-how and processes (other than Intellectual
Property which is material to the business of the Parent Borrower and its
Subsidiaries, which Intellectual Property shall be owned by the Parent
Borrower and its Subsidiaries), and (l) other activities incidental or
related to the foregoing;
(ii) incur, create, assume or suffer to exist any Indebtedness or
other liabilities or financial obligations, except (a) nonconsensual
obligations imposed by operation of law, (b) pursuant to the Loan
Documents to which it is a party, (c) obligations with respect to its
Capital Stock, (d) the Holding Preferred Stock having an aggregate
liquidation preference not in excess of $94,000,000, (e) upon exchange of
the Holding Preferred Stock, the Holding Subordinated Exchange Debentures
in an aggregate principal amount not to exceed $94,000,000, provided that,
prior to the issuance of the Holding Subordinated Exchange Debentures,
Holding shall have furnished to the Administrative Agent a certificate of
a Responsible Officer of Holding to the effect that on the date of
issuance of the Holding Subordinated Exchange Debentures no Default or
Event of
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29
Default shall have occurred and be continuing or would result from the
issuance thereof and demonstrating that, at the time of and after giving
pro forma effect to such issuance, Holding shall have a Leverage Ratio of
less than 3.00 to 1.00, (f) the Holding Senior Discount Notes having an
original aggregate face amount not to exceed $35,000,000 and (g) the
Holding Loan in a principal amount not to exceed $40,000,000;
(iii) declare or pay any dividend (other than dividends payable
solely in additional shares of Holding Preferred Stock) on, or make any
payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, defeasance, retirement or
other acquisition of, any shares or Holding Preferred Stock or make any
other distribution (other than distributions payable solely in additional
shares of Holding Preferred Stock), either directly or indirectly, whether
in cash or property or in obligations of Holding or any Subsidiary, except
that after November 19, 2004, Holding may pay cash dividends on the shares
of Holding Preferred Stock so long as no Default or Event of Default shall
have occurred and be continuing or would result from the payment of such
cash dividend;
(iv) make any amendment, supplement, modification or waiver of any
of the terms of Holding Preferred Stock or the Preferred Stock Certificate
of Designation (in each case, other than any such amendment, supplement,
modification or waiver that (a) would extend the scheduled redemption date
or reduce the amount of any scheduled redemption payment or reduce the
rate or extend any date for payment of dividends thereon and (b) does not
involve the payment of a consent fee);
(v) in the event of the occurrence of a Change of Control, make any
payment, prepayment, repurchase or redemption of any Holding Subordinated
Exchange Debentures, any Holding Preferred Stock, any Holding Senior
Discount Notes or the Holding Loan, or make any payments on account of or
for a sinking or other analogous fund for the repurchase, redemption,
defeasance or other acquisition thereof, unless the Parent Borrower and
the other Borrowers shall have (a) made payment in full of the Loans, all
Reimbursement Obligations and any other amounts then due and owing to any
Lender or the Administrative Agent under the Credit Agreement and under
any Note and cash collateralized the L/C Obligations on terms reasonably
satisfactory to the Administrative Agent or (b) made an offer to pay the
Loans, all Reimbursement Obligations and any amounts then due and owing to
each Lender and the Administrative Agent under the Credit Agreement and
under any Note and to cash collateralize the L/C Obligations in respect of
each Lender and shall have made payment in full thereof to each such
Lender or the Administrative Agent which has accepted such offer and cash
collateralized the L/C Obligations in respect of each such Lender which
has accepted such offer;
(vi) make any optional payment, prepayment, repurchase or redemption
of the Holding Subordinated Exchange Debentures or the Holding Senior
Discount Notes or make any payments on account of or for a sinking or
other analogous fund for the repurchase, redemption, defeasance or other
acquisition thereof (other than scheduled payments of principal and
interest and payments of, in each case, fees and expenses
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30
required by the Holding Subordinated Exchange Debentures, the Holding
Senior Discount Notes or the Holding Senior Discount Note Indenture, only
to the extent permitted under the subordination provisions, if any,
applicable thereto); provided that, notwithstanding the foregoing, there
shall be no cash payment of principal or interest related to the Holding
Subordinated Exchange Debentures or the Holding Senior Discount Notes
until after November 19, 2004;
(vii) make any amendment, supplement, modification or waiver of any
of the terms of the Holding Subordinated Exchange Debentures, the Holding
Senior Discount Notes, the Holding Senior Discount Note Indenture or the
Holding Loan Agreement (a) which amends or modifies the subordination
provisions contained in the Holding Subordinated Exchange Debentures, (b)
which shortens the fixed maturity or increases the principal amount of, or
increases the rate or shortens the time of payment of interest on, or
increases the amount or shortens the time of payment of any principal or
premium payable whether at maturity, at a date fixed for prepayment or by
acceleration or otherwise of the Indebtedness evidenced by the Holding
Subordinated Exchange Debentures, the Holding Senior Discount Notes or the
Holding Loan or increases the amount of, or accelerates the time of
payment of, any fees or other amounts payable in connection therewith, (c)
which relates to any material affirmative or negative covenants or any
events of default or remedies thereunder and the effect of which, in
Holding's good faith judgment, is to subject Holding, or any of its
Subsidiaries, to any more onerous or more restrictive provisions or (d)
which otherwise adversely affects, in Holding's good faith judgment, the
interests of the Lenders as senior creditors with respect to the Holding
Subordinated Exchange Debentures, the Holding Senior Discount Notes, the
Holding Loan or the interests of the Lenders under the Credit Agreement in
any material respect;
(viii) designate any Indebtedness (other than the obligations under
the Credit Agreement and under the other Loan Documents) as "Designated
Senior Indebtedness" for the purposes of the Holding Subordinated Exchange
Debentures; or
(ix) own, lease, manage or otherwise operate any properties or
assets (including cash (other than cash received in connection with loans,
advances and dividends in accordance with subsection 8.7 of the Credit
Agreement pending application in the manner contemplated by said
subsection) and cash equivalents) other than the ownership of shares of
Capital Stock of the Parent Borrower.
SECTION 6. REMEDIAL PROVISIONS
6.1 Certain Matters Relating to Receivables. (a) At any time and
from time to time after the occurrence and during the continuance of an Event of
Default, the Administrative Agent shall have the right to make test
verifications of the Receivables in any manner and through any reasonable medium
that it reasonably considers advisable, and the relevant Grantor shall furnish
all such assistance and information as the Administrative Agent may reasonably
require in connection with such test verifications. At any time and from time to
time after the occurrence and during the continuance of an Event of Default,
upon the Administrative Agent's reasonable request and at the expense of the
relevant Grantor, such Grantor shall cause independent public
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31
accountants or others reasonably satisfactory to the Administrative Agent to
furnish to the Administrative Agent reports showing reconciliations, aging and
test verifications of, and trial balances for, the Receivables.
(b) The Administrative Agent hereby authorizes each Grantor to
collect such Grantor's Receivables and the Administrative Agent may curtail or
terminate said authority at any time after the occurrence and during the
continuance of an Event of Default. If required by the Administrative Agent at
any time after the occurrence and during the continuance of an Event of Default,
any Proceeds constituting payments of Receivables, when collected by such
Grantor, (i) shall be forthwith (and, in any event, within two Business Days of
receipt by such Grantor) deposited in, or otherwise transferred by such Grantor
to, the Collateral Proceeds Account established by such Grantor maintained under
the sole dominion and control of the Administrative Agent, subject to withdrawal
by the Administrative Agent for the account of the Secured Parties only as
provided in Section 6.5, and (ii) until so turned over, shall be held by such
Grantor in trust for the Administrative Agent and the other Secured Parties,
segregated from other funds of such Grantor. All Proceeds constituting
collections of Receivables while held by the Collateral Account Bank (or by any
Grantor in trust for the benefit of the Administrative Agent and the other
Secured Parties) shall continue to be collateral security for all of the
Obligations and shall not constitute payment thereof until applied as
hereinafter provided. At any time when an Event of Default has occurred and is
continuing, at the Administrative Agent's election, the Administrative Agent may
apply all or any part of the funds on deposit in the Collateral Proceeds Account
established by the relevant Grantor to the payment of the Obligations of such
Grantor then due and owing, such application to be made as set forth in Section
6.5 hereof. So long as no Event of Default has occurred and is continuing, the
funds on deposit in the Collateral Proceeds Account shall be remitted as
provided in Section 6.1(d) hereof.
(c) At any time and from time to time after the occurrence and
during the continuance of an Event of Default, at the Administrative Agent's
request, each Grantor shall deliver to the Administrative Agent copies or, if
required by the Administrative Agent for the enforcement thereof or foreclosure
thereon, originals of all documents held by such Grantor evidencing, and
relating to, the agreements and transactions which gave rise to such Grantor's
Receivables, including, without limitation, all statements relating to such
Grantor's Receivables and all orders, invoices and shipping receipts.
(d) General Fund Account. So long as no Event of Default has
occurred and is continuing, the Administrative Agent shall instruct the
Collateral Account Bank to promptly remit any funds on deposit in each Grantor's
Collateral Proceeds Account to such Grantor's General Fund Account. In the event
that an Event of Default has occurred and is continuing, the Administrative
Agent and the Grantors agree that the Administrative Agent, at its option, may
require that each Collateral Proceeds Account be established at The Chase
Manhattan Bank. Each Grantor shall have the right, at any time and from time to
time, to withdraw such of its own funds from its own General Fund Account, and
to maintain such balances in its General Fund Account, as it shall deem to be
necessary or desirable.
6.2 Communications with Obligors; Grantors Remain Liable. (a) The
Administrative Agent in its own name or in the name of others may at any time
and from time to
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32
time after the occurrence and during the continuance of an Event of Default
communicate with obligors under the Receivables and parties to the Contracts (in
each case, to the extent constituting Collateral) to verify with them to the
Administrative Agent's satisfaction the existence, amount and terms of any
Receivables or Contracts.
(b) Upon the request of the Administrative Agent at any time after
the occurrence and during the continuance of an Event of Default, each Grantor
shall notify obligors on such Grantor's Receivables and parties to such
Grantor's Contracts (in each case, to the extent constituting Collateral) that
such Receivables and such Contracts have been assigned to the Administrative
Agent, for the ratable benefit of the Secured Parties, and that payments in
respect thereof shall be made directly to the Administrative Agent.
(c) Anything herein to the contrary notwithstanding, each Grantor
shall remain liable under each of such Grantor's Receivables and Contracts to
observe and perform all the conditions and obligations to be observed and
performed by it thereunder, all in accordance with the terms of any agreement
giving rise thereto. Neither the Administrative Agent nor any Secured Party
shall have any obligation or liability under any Receivable or Contract (or any
agreement giving rise thereto) by reason of or arising out of this Agreement or
the receipt by the Administrative Agent or any other Secured Party of any
payment relating thereto, nor shall the Administrative Agent or any other
Secured Party be obligated in any manner to perform any of the obligations of
any Grantor under or pursuant to any Receivable or Contract (or any agreement
giving rise thereto) to make any payment, to make any inquiry as to the nature
or the sufficiency of any payment received by it or as to the sufficiency of any
performance by any party thereunder, to present or file any claim, to take any
action to enforce any performance or to collect the payment of any amounts which
may have been assigned to it or to which it may be entitled at any time or
times.
6.3 Pledged Stock. (a) Unless an Event of Default shall have
occurred and be continuing and the Administrative Agent shall have given notice
to the relevant Pledgor of the Administrative Agent's intent to exercise its
corresponding rights pursuant to Section 6.3(b), each Pledgor shall be permitted
to receive all cash dividends paid in respect of the Pledged Stock and all
payments made in respect of the Pledged Notes, to the extent permitted in the
Credit Agreement, and to exercise all voting and corporate rights with respect
to the Pledged Securities; provided, however, that no vote shall be cast or
corporate right exercised or such other action taken (other than in connection
with a transaction expressly permitted by the Credit Agreement) which would
materially impair the Pledged Collateral or the related rights or remedies of
the Secured Parties or which would be inconsistent with or result in any
violation of any provision of the Credit Agreement, this Agreement or any other
Loan Document.
(b) If an Event of Default shall occur and be continuing and the
Administrative Agent shall give notice of its intent to exercise such rights to
the relevant Pledgor or Pledgors, (i) the Administrative Agent shall have the
right to receive any and all cash dividends, payments or other Proceeds paid in
respect of the Pledged Securities and make application thereof to the
Obligations in such order as is provided in Section 6.5 and (ii) any or all of
the Pledged Securities shall be registered in the name of the Administrative
Agent or its nominee, and the Administrative Agent or its nominee may thereafter
exercise (x) all voting, corporate and other rights pertaining
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33
to such Pledged Securities at any meeting of shareholders of the relevant Issuer
or Issuers or otherwise and (y) any and all rights of conversion, exchange,
subscription and any other rights, privileges or options pertaining to such
Pledged Securities as if it were the absolute owner thereof (including, without
limitation, the right to exchange at its discretion any and all of the Pledged
Securities upon the merger, consolidation, reorganization, recapitalization or
other fundamental change in the corporate structure of any Issuer, or upon the
exercise by the relevant Pledgor or the Administrative Agent of any right,
privilege or option pertaining to such Pledged Securities, and in connection
therewith, the right to deposit and deliver any and all of the Pledged
Securities with any committee, depositary, transfer agent, registrar or other
designated agency upon such terms and conditions as the Administrative Agent may
reasonably determine), all without liability (other than for its gross
negligence or willful misconduct) except to account for property actually
received by it, but the Administrative Agent shall have no duty to any Pledgor
to exercise any such right, privilege or option and shall not be responsible for
any failure to do so or delay in so doing, provided that the Administrative
Agent shall not exercise any voting or other consensual rights pertaining to the
Pledged Securities in any way that would constitute an exercise of the remedies
described in Section 6.6 other than in accordance with Section 6.6.
(c) Each Pledgor hereby authorizes and instructs each Issuer of any
Pledged Securities pledged by such Pledgor hereunder to (i) comply with any
instruction received by it from the Administrative Agent in writing that (x)
states that an Event of Default has occurred and is continuing and (y) is
otherwise in accordance with the terms of this Agreement, without any other or
further instructions from such Pledgor, and each Pledgor agrees that each Issuer
shall be fully protected in so complying and (ii) to the extent so provided in
this Section 6.3, pay any dividends or other payments with respect to the
Pledged Securities directly to the Administrative Agent.
6.4 Proceeds to be Turned Over To Administrative Agent. In addition
to the rights of the Administrative Agent and the other Secured Parties
specified in Section 6.1 with respect to payments of Receivables, if an Event of
Default shall occur and be continuing, and the Administrative Agent shall have
instructed any Grantor to do so, all Proceeds received by such Grantor
consisting of cash, checks and other Cash Equivalents shall be held by such
Grantor in trust for the Administrative Agent and the other Secured Parties,
segregated from other funds of such Grantor, and shall, forthwith upon receipt
by such Grantor, be turned over to the Administrative Agent in the exact form
received by such Grantor (duly indorsed by such Grantor to the Administrative
Agent, if required). All Proceeds received by the Administrative Agent
hereunder shall be held by the Administrative Agent in the relevant
Collateral Proceeds Account maintained under its sole dominion and control.
All Proceeds while held by the Administrative Agent in such Collateral
Proceeds Account (or by such Grantor in trust for the Administrative Agent
and the other Secured Parties) shall continue to be held as collateral
security for all the Obligations and shall not constitute payment thereof
until applied as provided in Section 6.5.
6.5 Application of Proceeds. It is agreed that if an Event of
Default shall occur and be continuing, any and all Proceeds of the relevant
Granting Party's Security Collateral received by the Administrative Agent
(whether from the relevant Granting Party or otherwise) shall be held by the
Administrative Agent for the benefit of the Secured Parties as collateral
security for the Obligations of the relevant Granting Party (whether matured or
unmatured),
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34
and/or then or at any time thereafter may, in the sole discretion of the
Administrative Agent, be applied by the Administrative Agent against the
Obligations of the relevant Granting Party then due and owing in the following
order of priority:
FIRST, to the payment of all reasonable costs and expenses incurred
by the Administrative Agent in connection with this Agreement, the Credit
Agreement, any other Loan Document or any of the Obligations of the
relevant Granting Party, including, without limitation, all court costs
and the reasonable fees and expenses of its agents and legal counsel, and
any other reasonable costs or expenses incurred in connection with the
exercise by the Administrative Agent of any right or remedy under this
Agreement, the Credit Agreement, or any other Loan Document; provided,
however, that, if the relevant Granting Party is a Foreign Subsidiary,
such Proceeds shall be applied only to the payment of all reasonable costs
and expenses incurred by the Administrative Agent in connection with the
Obligations of such Granting Party;
SECOND, to the ratable satisfaction of all other Obligations of the
relevant Granting Party; provided, however, that, if the relevant Granting
Party is a Foreign Subsidiary, such Proceeds shall be applied only to the
payment of the Obligations of such Granting Party; and
THIRD, to the relevant Granting Party or its successors or assigns,
or to whomsoever may be lawfully entitled to receive the same.
6.6 Code and Other Remedies. If an Event of Default shall occur and
be continuing, the Administrative Agent, on behalf of the Secured Parties, may
exercise, in addition to all other rights and remedies granted to them in this
Agreement and in any other instrument or agreement securing, evidencing or
relating to the Obligations, all rights and remedies of a secured party under
the Code or any other applicable law. Without limiting the generality of the
foregoing, to the extent permitted by applicable law, the Administrative Agent,
without demand of performance or other demand, presentment, protest,
advertisement or notice of any kind (except any notice required by law referred
to below) to or upon any Granting Party or any other Person (all and each of
which demands, defenses, advertisements and notices are hereby waived), may in
such circumstances forthwith (subject to the terms of any documentation
governing any Permitted Receivables Securitization) collect, receive,
appropriate and realize upon the Security Collateral, or any part thereof,
and/or may forthwith sell, lease, assign, give option or options to purchase, or
otherwise dispose of and deliver the Security Collateral or any part thereof (or
contract to do any of the foregoing), in one or more parcels at public or
private sale or sales, at any exchange, broker's board or office of the
Administrative Agent or any other Secured Party or elsewhere upon such terms and
conditions as it may deem advisable and at such prices as it may deem best, for
cash or on credit or for future delivery without assumption of any credit risk.
The Administrative Agent or any other Secured Party shall have the right to the
extent permitted by law, upon any such sale or sales, to purchase the whole or
any part of the Security Collateral so sold, free of any right or equity of
redemption in any Granting Party, which right or equity is hereby waived and
released. Each Granting Party further agrees, at the Administrative Agent's
request (subject to the terms of any documentation governing any Permitted
Receivables Securitization), to assemble the Security Collateral and make it
available to the Administrative
<PAGE>
35
Agent at places which the Administrative Agent shall reasonably select, whether
at such Granting Party's premises or elsewhere. The Administrative Agent shall
apply the net proceeds of any action taken by it pursuant to this Section 6.6,
after deducting all reasonable costs and expenses of every kind incurred in
connection therewith or incidental to the care or safekeeping of any of the
Security Collateral or in any way relating to the Security Collateral or the
rights of the Administrative Agent and the other Secured Parties hereunder,
including, without limitation, reasonable attorneys' fees and disbursements, to
the payment in whole or in part of the Obligations of the relevant Granting
Party, in the order of priority specified in Section 6.5 above, and only after
such application and after the payment by the Administrative Agent of any other
amount required by any provision of law, including, without limitation, Section
9-504(1)(c) of the Code, need the Administrative Agent account for the surplus,
if any, to any Granting Party. To the extent permitted by applicable law, each
Granting Party waives all claims, damages and demands it may acquire against the
Administrative Agent or any other Secured Party arising out of the exercise by
them of any rights hereunder, except to the extent arising as a result of the
gross negligence or willful misconduct of the Administrative Agent or such other
Secured Party. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least 10 days before such sale or other disposition.
6.7 Registration Rights. (a) If the Administrative Agent shall
determine to exercise its right to sell any or all of the Pledged Stock pursuant
to Section 6.6, and if in the reasonable opinion of the Administrative Agent it
is necessary or reasonably advisable to have the Pledged Stock, or that portion
thereof to be sold, registered under the provisions of the Securities Act, the
relevant Pledgor will use its reasonable best efforts to cause the Issuer
thereof to (i) execute and deliver, and use its best efforts to cause the
directors and officers of such Issuer to execute and deliver, all such
instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the Administrative Agent, necessary or advisable to
register such Pledged Stock, or that portion thereof to be sold, under the
provisions of the Securities Act, (ii) use its reasonable best efforts to cause
the registration statement relating thereto to become effective and to remain
effective for a period of not more than one year from the date of the first
public offering of such Pledged Stock, or that portion thereof to be sold, and
(iii) make all amendments thereto and/or to the related prospectus which, in the
reasonable opinion of the Administrative Agent, are necessary or advisable, all
in conformity with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission applicable thereto. Such
Pledgor agrees to cause such Issuer to comply with the provisions of the
securities or "Blue Sky" laws of any and all jurisdictions which the
Administrative Agent shall reasonably designate and to make available to its
security holders, as soon as practicable, an earnings statement (which need not
be audited) which will satisfy the provisions of Section 11(a) of the Securities
Act.
(b) Such Pledgor recognizes that the Administrative Agent may be
unable to effect a public sale of any or all such Pledged Stock, by reason of
certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. Such
Pledgor acknowledges and agrees that any
<PAGE>
36
such private sale may result in prices and other terms less favorable than if
such sale were a public sale and, notwithstanding such circumstances, agrees
that any such private sale shall be deemed to have been made in a commercially
reasonable manner. The Administrative Agent shall be under no obligation to
delay a sale of any of the Pledged Stock for the period of time necessary to
permit the Issuer thereof to register such securities for public sale under the
Securities Act, or under applicable state securities laws, even if such Issuer
would agree to do so.
(c) Such Pledgor agrees to use its reasonable best efforts to do or
cause to be done all such other acts as may be necessary to make such sale or
sales of all or any portion of such Pledged Stock pursuant to this Section 6.7
valid and binding and in compliance with any and all other applicable
Requirements of Law. Such Pledgor further agrees that a breach of any of the
covenants contained in this Section 6.7 will cause irreparable injury to the
Administrative Agent and the other Secured Parties, that the Administrative
Agent and the other Secured Parties have no adequate remedy at law in respect of
such breach and, as a consequence, that each and every covenant contained in
this Section 6.7 shall be specifically enforceable against such Pledgor, and to
the extent permitted by applicable law, such Pledgor hereby waives and agrees
not to assert any defenses against an action for specific performance of such
covenants except for a defense that no Event of Default has occurred and is
continuing under the Credit Agreement.
6.8 Waiver; Deficiency. Each Granting Party (other than the
Borrowers) waives and agrees not to assert any rights or privileges which it may
acquire under Section 9-112 of the Code, to the extent permitted by applicable
law. Each Granting Party shall remain liable for any deficiency if the proceeds
of any sale or other disposition of the Security Collateral are insufficient to
pay its Obligations and the fees and disbursements of any attorneys employed by
the Administrative Agent or any other Secured Party to collect such deficiency.
SECTION 7. THE ADMINISTRATIVE AGENT
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc. (a)
Each Granting Party hereby irrevocably constitutes and appoints the
Administrative Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of such Granting Party and in the
name of such Granting Party or in its own name, for the purpose of carrying out
the terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be reasonably necessary
or desirable to accomplish the purposes of this Agreement to the extent
permitted by applicable law. Without limiting the generality of the foregoing,
at any time when an Event of Default has occurred and is continuing (in each
case to the extent permitted by applicable law), (x) each Pledgor hereby gives
the Administrative Agent the power and right, on behalf of such Pledgor, without
notice or assent by such Pledgor, to execute, in connection with any sale
provided for in Section 6.6 or 6.7, any indorsements, assignments or other
instruments of conveyance or transfer with respect to such Pledgor's Pledged
Collateral and (y) each Grantor hereby gives the Administrative Agent the power
and right, on behalf of such Grantor, without notice to or assent by such
Grantor, to do any or all of the following:
<PAGE>
37
(i) subject to the terms of any documentation governing any
Permitted Receivables Securitization, in the name of such Grantor or its
own name, or otherwise, take possession of and indorse and collect any
checks, drafts, notes, acceptances or other instruments for the payment of
moneys due under any Receivable or Contract of such Grantor or with
respect to any other Collateral of such Grantor and file any claim or take
any other action or institute any proceeding in any court of law or equity
or otherwise deemed appropriate by the Administrative Agent for the
purpose of collecting any and all such moneys due under any Receivable or
Contract of such Grantor or with respect to any other Collateral of such
Grantor whenever payable;
(ii) in the case of any Copyright, Patent or Trademark constituting
Collateral of such Grantor, execute and deliver any and all agreements,
instruments, documents and papers as the Administrative Agent may
reasonably request to evidence the Administrative Agent's and the other
Secured Parties' security interest in such Copyright, Patent or Trademark
and the goodwill and general intangibles of such Grantor relating thereto
or represented thereby;
(iii) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral of such Grantor, other than Liens
permitted under this Agreement or the other Loan Documents, effect any
repairs or any insurance called for by the terms of this Agreement and pay
all or any part of the premiums therefor and the costs thereof; and
(iv) subject to the terms of any documentation governing any
Permitted Receivables Securitization, (1) direct any party liable for any
payment under any of the Collateral of such Grantor to make payment of any
and all moneys due or to become due thereunder directly to the
Administrative Agent or as the Administrative Agent shall direct; (2) ask
or demand for, collect, and receive payment of and receipt for, any and
all moneys, claims and other amounts due or to become due at any time in
respect of or arising out of any Collateral of such Grantor; (3) sign and
indorse any invoices, freight or express bills, bills of lading, storage
or warehouse receipts, drafts against debtors, assignments, verifications,
notices and other documents in connection with any of the Collateral of
such Grantor; (4) commence and prosecute any suits, actions or proceedings
at law or in equity in any court of competent jurisdiction to collect the
Collateral of such Grantor or any portion thereof and to enforce any other
right in respect of any Collateral of such Grantor; (5) defend any suit,
action or proceeding brought against such Grantor with respect to any
Collateral of such Grantor; (6) settle, compromise or adjust any such
suit, action or proceeding described in clause (5) above and, in
connection therewith, to give such discharges or releases as the
Administrative Agent may deem appropriate; (7) subject to any existing
reserved rights or licenses, assign any Copyright, Patent or Trademark
constituting Collateral of such Grantor (along with the goodwill of the
business to which any such Copyright, Patent or Trademark pertains), for
such term or terms, on such conditions, and in such manner, as the
Administrative Agent shall in its sole discretion determine; and (8)
generally, sell, transfer, pledge and make any agreement with respect to
or otherwise deal with any of the Collateral of such Grantor as fully and
completely as though the Administrative Agent were the absolute owner
thereof for all purposes, and do, at the Administrative Agent's option and
such Grantor's expense, at any
<PAGE>
38
time, or from time to time, all acts and things which the Administrative
Agent deems necessary to protect, preserve or realize upon the Collateral
of such Grantor and the Administrative Agent's and the other Secured
Parties' security interests therein and to effect the intent of this
Agreement, all as fully and effectively as such Grantor might do.
Anything in this Section 7.1(a) to the contrary notwithstanding, the
Administrative Agent agrees that it will not exercise any rights under the power
of attorney provided for in this Section 7.1(a) unless an Event of Default shall
have occurred and be continuing.
(b) If any Granting Party fails to perform or comply with any of its
agreements contained herein, the Administrative Agent, at its option, but
without any obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement.
(c) The reasonable expenses of the Administrative Agent incurred in
connection with actions undertaken as provided in this Section 7.1, together
with interest thereon at a rate per annum equal to 1.75% above the rate
applicable to ABR Loans which are Tranche B Term Loans, from the date of payment
by the Administrative Agent to the date reimbursed by the relevant Granting
Party, shall be payable by such Granting Party to the Administrative Agent on
demand.
(d) Each Granting Party hereby ratifies all that said attorneys
shall lawfully do or cause to be done by virtue hereof. All powers,
authorizations and agencies contained in this Agreement are coupled with an
interest and are irrevocable as to the relevant Granting Party until this
Agreement is terminated as to such Granting Party, and the security interests in
the Security Collateral of such Granting Party created hereby are released.
7.2 Duty of Administrative Agent. The Administrative Agent's sole
duty with respect to the custody, safekeeping and physical preservation of the
Security Collateral in its possession, under Section 9-207 of the Code or
otherwise, shall be to deal with it in the same manner as the Administrative
Agent deals with similar property for its own account. Neither the
Administrative Agent, any other Secured Party nor any of their respective
officers, directors, employees or agents shall be liable for failure to demand,
collect or realize upon any of the Security Collateral or for any delay in doing
so or shall be under any obligation to sell or otherwise dispose of any Security
Collateral upon the request of any Granting Party or any other Person or (except
as provided in the first sentence of this Section 7.2) to take any other action
whatsoever with regard to the Security Collateral or any part thereof. The
powers conferred on the Administrative Agent and the other Secured Parties
hereunder are solely to protect the Administrative Agent's and the other Secured
Parties' interests in the Security Collateral and shall not impose any duty upon
the Administrative Agent or any other Secured Party to exercise any such powers.
The Administrative Agent and the other Secured Parties shall be accountable only
for amounts that they actually receive as a result of the exercise of such
powers, and neither they nor any of their officers, directors, employees or
agents shall be responsible to any Granting Party for any act or failure to act
hereunder, except for their own gross negligence or willful misconduct.
<PAGE>
39
7.3 Execution of Financing Statements. Pursuant to Section 9-402 of
the Code and any other applicable law, each Granting Party authorizes the
Administrative Agent to file or record financing statements and other filing or
recording documents or instruments with respect to such Granting Party's
Security Collateral without the signature of such Granting Party in such form
and in such offices as the Administrative Agent reasonably determines
appropriate to perfect the security interests of the Administrative Agent under
this Agreement. A photographic or other reproduction of this Agreement shall be
sufficient as a financing statement or other filing or recording document or
instrument for filing or recording in any jurisdiction.
7.4 Authority of Administrative Agent. Each Granting Party
acknowledges that the rights and responsibilities of the Administrative Agent
under this Agreement with respect to any action taken by the Administrative
Agent or the exercise or non-exercise by the Administrative Agent of any option,
voting right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement or any amendment, supplement or other
modification of this Agreement shall, as between the Administrative Agent and
the Secured Parties, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Administrative Agent and the Granting Parties, the Administrative
Agent shall be conclusively presumed to be acting as agent for the Secured
Parties with full and valid authority so to act or refrain from acting, and no
Granting Party shall be under any obligation, or entitlement, to make any
inquiry respecting such authority.
7.5 Right Of Inspection. Upon reasonable written advance notice to
any Grantor and at reasonable intervals, or at any time and from time to time
after the occurrence and during the continuation of an Event of Default, the
Administrative Agent shall have reasonable access during normal business hours
to all the books, correspondence and records of such Granting Party, and the
Administrative Agent and its representatives may examine the same, and to the
extent reasonable, take extracts therefrom and make photocopies thereof, and
such Granting Party agrees to render to the Administrative Agent, at such
Granting Party's reasonable cost and expense, such clerical and other assistance
as may be reasonably requested with regard thereto. The Administrative Agent and
its representatives shall also have the right, upon reasonable advance written
notice to such Granting Party, to enter during normal business hours into and
upon any premises owned, leased or operated by such Granting Party where any of
such Granting Party's Inventory, Equipment or Vehicles is located for the
purpose of inspecting the same, observing its use or otherwise protecting its
interests therein.
SECTION 8. MISCELLANEOUS
8.1 Amendments in Writing. Except as otherwise provided in
subsection 11.1 of the Credit Agreement, none of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except by a
written instrument executed by each affected Granting Party and the
Administrative Agent, provided, that any provision of this Agreement imposing
obligations on any Granting Party may be waived by a written instrument executed
by the Administrative Agent.
<PAGE>
40
8.2 Notices. All notices, requests and demands to or upon the
Administrative Agent or any Granting Party hereunder shall be effected in the
manner provided for in subsection 11.2 of the Credit Agreement; provided that
any such notice, request or demand to or upon any Guarantor shall be addressed
to such Guarantor at its notice address set forth on Schedule 1, unless and
until such Guarantor shall change such address by notice to the Administrative
Agent given in accordance with subsection 11.2 of the Credit Agreement.
8.3 No Waiver by Course of Conduct; Cumulative Remedies. Neither the
Administrative Agent nor any other Secured Party shall by any act (except by a
written instrument pursuant to Section 8.1), delay, indulgence, omission or
otherwise be deemed to have waived any right or remedy hereunder or to have
acquiesced in any Default or Event of Default. No failure to exercise, nor any
delay in exercising, on the part of the Administrative Agent or any other
Secured Party, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Administrative Agent or
any other Secured Party or any Granting Party of any right or remedy hereunder
on any one occasion shall not be construed as a bar to any right or remedy which
the Administrative Agent or such other Secured Party or such Granting Party
would otherwise have on any future occasion. The rights and remedies herein
provided are cumulative, may be exercised singly or concurrently and are not
exclusive of any other rights or remedies provided by law.
8.4 Enforcement Expenses; Indemnification. (a) Each Guarantor agrees
to pay or reimburse each Secured Party and the Administrative Agent for all
their respective reasonable costs and expenses incurred in collecting against
such Guarantor under the guarantee contained in Section 2 or otherwise enforcing
or preserving any rights under this Agreement against such Guarantor and the
other Loan Documents to which such Guarantor is a party, including, without
limitation, the reasonable fees and disbursements of one firm of counsel and
local counsel to the Secured Parties and the Administrative Agent.
(b) Each Guarantor agrees to pay, and to save the Administrative
Agent and the Secured Parties harmless from, (x) any and all liabilities with
respect to, or resulting from any delay in paying, any and all stamp, excise,
sales or other similar taxes which may be payable or determined to be payable
with respect to any of the Security Collateral and (y) any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement (collectively, the "indemnified liabilities"), in each case to the
extent any of the Borrowers would be required to do so pursuant to Section 11.5
of the Credit Agreement, and in any event excluding any taxes or other
indemnified liabilities arising from gross negligence or willful misconduct of
the Administrative Agent or any Secured Party or any of their respective agents,
officers, directors and successors.
(c) The agreements in this Section 8.4 shall survive repayment of
the Obligations and all other amounts payable under the Credit Agreement and the
other Loan Documents.
<PAGE>
41
8.5 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the Granting Parties, the Administrative Agent and
the Secured Parties and their respective successors and assigns; provided that
no Granting Party may assign, transfer or delegate any of its rights or
obligations under this Agreement without the prior written consent of the
Administrative Agent.
8.6 Set-Off. Each Guarantor hereby irrevocably authorizes the
Administrative Agent and each other Secured Party at any time and from time to
time without notice to such Guarantor, any other Guarantor or any Borrower, any
such notice being expressly waived by each Guarantor and by each Borrower, to
the extent permitted by applicable law, upon the occurrence and during the
continuance of an Event of Default under Section 9(a) of the Credit Agreement
and any amount remaining unpaid after it becomes due and payable by such
Guarantor hereunder, to set-off and appropriate and apply against any such
amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by the Administrative Agent or
such other Secured Party to or for the credit or the account of such Guarantor,
or any part thereof in such amounts as the Administrative Agent or such other
Secured Party may elect. The Administrative Agent and each other Secured Party
shall notify such Guarantor promptly of any such set-off and the application
made by the Administrative Agent or such other Secured Party of the proceeds
thereof; provided that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of the Administrative Agent
and each other Secured Party under this Section 8.6 are in addition to other
rights and remedies (including, without limitation, other rights of set-off)
which the Administrative Agent or such other Secured Party may have.
8.7 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument.
8.8 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction; provided that, with
respect to any Pledged Collateral of any Foreign Subsidiary Holdco or any
Foreign Subsidiary Borrower and any Security Collateral of any Foreign
Subsidiary Borrower, all rights, powers and remedies provided in this Agreement
may be exercised only to the extent that they do not violate any provision of
any law, rule or regulation of any Governmental Authority applicable to any such
Collateral or affecting the legality, validity or enforceability of any of the
provisions of this Agreement against any such Foreign Subsidiary Holdco or
Foreign Subsidiary Borrower (such laws, rules or regulations, "Applicable Law")
and are intended to be limited to the extent necessary so that they will not
render this Agreement invalid, unenforceable or not entitled to be recorded,
registered or filed under the provisions of any Applicable Law.
<PAGE>
42
8.9 Section Headings. The Section headings used in this Agreement
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
8.10 Integration. This Agreement and the other Loan Documents
represent the entire agreement of the Granting Parties, the Administrative Agent
and the other Secured Parties with respect to the subject matter hereof, and
there are no promises, undertakings, representations or warranties by the
Granting Parties, the Administrative Agent or any other Secured Party relative
to subject matter hereof not expressly set forth or referred to herein or in the
other Loan Documents.
8.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
8.12 Submission To Jurisdiction; Waivers. Each party hereto hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to
which it is a party, or for recognition and enforcement of any judgement
in respect thereof, to the non-exclusive general jurisdiction of the
courts of the State of New York, the courts of the United States of
America for the Southern District of New York, and appellate courts from
any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient forum and agrees not
to plead or claim the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail
(or any substantially similar form of mail), postage prepaid, to such
party at its address referred to in Section 8.2 (or, in the case of any
Foreign Subsidiary Borrower, as specified in subsection 11.12(b) of the
Credit Agreement) or at such other address of which the Administrative
Agent (in the case of any other party hereto) or the Parent Borrower (in
the case of the Administrative Agent) shall have been notified pursuant
thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or proceeding referred
to in this Section any punitive damages.
<PAGE>
43
8.13 Acknowledgments. Each Guarantor hereby acknowledges that
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents to which it is a
party;
(b) neither the Administrative Agent nor any other Secured Party has
any fiduciary relationship with or duty to any Guarantor arising out of or
in connection with this Agreement or any of the other Loan Documents, and
the relationship between the Guarantors, on the one hand, and the
Administrative Agent and the Secured Parties, on the other hand, in
connection herewith or therewith is solely that of debtor and creditor;
and
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions contemplated
hereby and thereby among the Secured Parties or among the Guarantors and
the Secured Parties.
8.14 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
8.15 Additional Granting Parties. Each new Domestic Subsidiary of
the Parent Borrower that is required to become a party to this Agreement
pursuant to subsection 7.10 or 8.16 of the Credit Agreement shall become a
Granting Party for all purposes of this Agreement upon execution and delivery by
such Subsidiary of an Assumption Agreement in the form of Annex 1 hereto, and
each Foreign Subsidiary Borrower that is required to become a party to this
Agreement pursuant to subsection 11.1(b)(i) of the Credit Agreement shall become
a Granting Party for all purposes of this Agreement upon execution and delivery
by such Borrower of a Joinder Agreement in the form of Exhibit K to the Credit
Agreement.
8.16 Releases. (a) At such time as the Loans, the Reimbursement
Obligations and the other Obligations then due and owing shall have been paid in
full in cash, the Commitments have been terminated and no Letters of Credit
shall be outstanding, all Security Collateral shall be released from the Liens
created hereby, and this Agreement and all obligations (other than those
expressly stated to survive such termination) of the Administrative Agent and
each Granting Party hereunder shall terminate, all without delivery of any
instrument or performance of any act by any party, and all rights to the
Security Collateral shall revert to the Granting Parties. At the request and
sole expense of any Granting Party following any such termination, the
Administrative Agent shall deliver to such Granting Party any Security
Collateral held by the Administrative Agent hereunder, and execute and deliver
to such Granting Party such documents (including without limitation Uniform
Commercial Code termination statements) as such Granting Party shall reasonably
request to evidence such termination.
(b) In connection with any sale or other disposition of Security
Collateral permitted by the Credit Agreement (including, without limitation, any
Permitted Receivables Securitization), the Lien pursuant to this Agreement on
such sold or disposed of Security
<PAGE>
44
Collateral shall be automatically released. In connection with the release of
any Guarantor from its Guarantee or the release of the Security Collateral
subject to such sale or other disposition, the Administrative Agent shall
execute and deliver to the relevant Granting Party (at the sole cost and expense
of such Granting Party) all releases or other documents (including without
limitation Uniform Commercial Code termination statements) necessary or
reasonably desirable for the release of the Liens created hereby on such
Security Collateral and, if applicable, such Guarantee as such Granting Party
may reasonably request.
<PAGE>
45
IN WITNESS WHEREOF, each of the undersigned has caused this
Guarantee and Collateral Agreement to be duly executed and delivered as of the
date first above written.
NA HOLDING CORPORATION
By: /s/ R. Barry Uber
-----------------------------------
Name: R. Barry Uber
Title:
<PAGE>
NORTH AMERICAN VAN LINES, INC.
By: /s/ R. Barry Uber
-----------------------------------
Name: R. Barry Uber
Title:
FLEET INSURANCE MANAGEMENT, INC.
By: /s/ R. Barry Uber
-----------------------------------
Name: R. Barry Uber
Title:
FRONTRUNNER WORLDWIDE, INC.
By: /s/ R. Barry Uber
-----------------------------------
Name: R. Barry Uber
Title:
GREAT FALLS NORTH AMERICAN, INC.
By: /s/ Ralph A. Ford
-----------------------------------
Name: Ralph A. Ford
Title:
NACAL, INC.
By: /s/ R. Barry Uber
-----------------------------------
Name: R. Barry Uber
Title:
<PAGE>
NAVTRANS INTERNATIONAL FREIGHT
FORWARDING, INC.
By: /s/ R. Barry Uber
-----------------------------------
Name: R. Barry Uber
Title:
NORTH AMERICAN DISTRIBUTION
SYSTEMS, INC.
By: /s/ R. Barry Uber
-----------------------------------
Name: R. Barry Uber
Title:
NORTH AMERICAN LOGISTICS, LTD.
By: /s/ R. Barry Uber
-----------------------------------
Name: R. Barry Uber
Title:
NORTH AMERICAN VAN LINES OF TEXAS,
INC.
By: /s/ R. Barry Uber
-----------------------------------
Name: R. Barry Uber
Title:
RELOCATION MANAGEMENT SYSTEMS,
INC.
By: /s/ Ralph A. Ford
-----------------------------------
Name: Ralph A. Ford
Title:
A RELOCATION SOLUTIONS MANAGEMENT COMPANY
By: /s/ Robert J. Henry
-----------------------------------
Name: Robert J. Henry
Title: Secretary
<PAGE>
ALLIED FREIGHT FORWARDING, INC.
By: /s/ Robert J. Henry
-----------------------------------
Name: Robert J. Henry
Title: Secretary
ALLIED VAN LINES, INC.
By: /s/ Robert J. Henry
-----------------------------------
Name: Robert J. Henry
Title: Secretary
ALLIED INTERNATIONAL N.A., INC.
By: /s/ Robert J. Henry
-----------------------------------
Name: Robert J. Henry
Title: Vice President
ALLIED VAN LINES TERMINAL COMPANY
By: /s/ Robert J. Henry
-----------------------------------
Name: Robert J. Henry
Title: Secretary
VANGUARD INSURANCE AGENCY, INC.
By: /s/ Robert J. Henry
-----------------------------------
Name: Robert J. Henry
Title: Secretary
<PAGE>
Acknowledged and Agreed to as
of the date hereof by:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By: /s/ Richard W. Duker
-----------------------------------
Name: Richard W. Duker
Title: Vice President
<PAGE>
Schedule 1
NOTICE ADDRESSES OF GUARANTORS
<PAGE>
Schedule 2
DESCRIPTION OF PLEDGED SECURITIES
Pledged Stock:
- --------------------- ----------------- ------------------- --------------
Stock Certificate
Issuer Class of Stock No. No. of Shares
Pledged Notes:
Issuer Payee Principal Amount
--------- ----------- ------------------
<PAGE>
Schedule 3
LOCATION OF JURISDICTION OF ORGANIZATION AND CHIEF EXECUTIVE OFFICE
OR SOLE PLACE OF BUSINESS
Granting Party Location
-------------- --------
<PAGE>
Schedule 4
LOCATION OF INVENTORY AND EQUIPMENT
Granting Party Locations
-------------- ---------
<PAGE>
Schedule 5
COPYRIGHTS AND COPYRIGHT LICENSES
PATENTS AND PATENT LICENSES
TRADEMARKS AND TRADEMARK LICENSES
<PAGE>
Schedule 6
EXISTING PRIOR LIENS
<PAGE>
Schedule 7
RECEIVABLES
<PAGE>
Schedule 8
CONTRACTS
1. Acquisition Agreement, dated as of September 14, 1999, between NA Holding
Corporation, a Delaware corporation, and NFC plc, a company organized
under the laws of England and Wales.
2. Software License Agreement, dated as of March 27, 1998, between Norfolk
Southern Corporation, a Virginia corporation, NS Transportation Brokerage
Corporation, a Delaware corporation and North American Van Lines, Inc., a
Delaware corporation, relating to the Customized Options in Logistics
Technology software.
<PAGE>
Schedule 9
VEHICLES
<PAGE>
ACKNOWLEDGMENT AND CONSENT(1)
The undersigned hereby acknowledges receipt of a copy of the Guarantee and
Collateral Agreement dated as of ______ __, 1999 (the "Agreement"), made by the
Granting Parties (as defined therein) named therein for the benefit of The Chase
Manhattan Bank, as Administrative Agent. The undersigned agrees in favor of the
Administrative Agent for the ratable benefit of the Secured Parties (as defined
therein) as follows:
1. The undersigned will be bound by the terms of the Agreement and will
comply with such terms insofar as such terms are applicable to the undersigned.
2. The undersigned will notify the Administrative Agent promptly in
writing of the occurrence of any of the events described in Section 5.3.1 of the
Agreement.
3. The terms of Sections 6.3(a) and 6.7 of the Agreement shall apply to
it, mutatis mutandis, with respect to all actions that may be required of it
pursuant to Section 6.3(a) and 6.7 of the Agreement.
[NAME OF ISSUER]
By_______________________________
Title____________________________
Address for Notices:
_________________________________
_________________________________
Fax: ____________________________
- ----------
(1) This consent is necessary only with respect to any Issuer of Pledged Stock
which is not also a Grantor.
<PAGE>
Annex 1 to
Guarantee and Collateral Agreement
ASSUMPTION AGREEMENT, dated as of _________ __, 199_, made by
______________________________, a ______________ corporation (the "Additional
Granting Party"), in favor of THE CHASE MANHATTAN BANK, as collateral agent and
administrative agent (in such capacities, the "Administrative Agent") for the
banks and other financial institutions (the "Lenders") from time to time parties
to the Credit Agreement referred to below and the other Secured Parties (as
defined below). All capitalized terms not defined herein shall have the meaning
ascribed to them in the Guarantee and Collateral Agreement referred to below, or
if not defined therein, in the Credit Agreement.
W I T N E S S E T H :
WHEREAS, North American Van Lines, Inc., a Delaware corporation (the
"Parent Borrower"), certain foreign subsidiaries of the Parent Borrower from
time to time parties to the Credit Agreement referred to below (the "Foreign
Subsidiary Borrowers"; together with the Parent Borrower, collectively, the
"Borrowers"), the Lenders, the Administrative Agent, The Bank of New York, as
documentation agent, and Banc of America Securities LLC, as syndication agent,
are parties to a Credit Agreement, dated as of November 19, 1999 (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement");
WHEREAS, in connection with the Credit Agreement, the Borrowers, NA
Holding Corporation ("Holding") and the other Granting Parties named therein are
parties to the Guarantee and Collateral Agreement, dated as of November 19, 1999
(as amended, supplemented or otherwise modified from time to time, the
"Guarantee and Collateral Agreement") in favor of the Administrative Agent, for
the ratable benefit of the Secured Parties (as defined in the Guarantee and
Collateral Agreement);
WHEREAS, the Additional Granting Party is a member of an affiliated
group of companies that includes Holding, the Borrowers and the other Granting
Parties to the Guarantee and Collateral Agreement; the proceeds of the
extensions of credit to the Borrowers under the Credit Agreement will be used in
part to enable such Borrowers to make valuable transfers to one or more of the
other Granting Parties (including the Additional Granting Party) in connection
with the operation of their respective businesses; and the Borrowers and the
other Granting Parties (including the Additional Granting Party) are engaged in
related businesses, and each such Granting Party (including the Additional
Granting Party) will derive substantial direct and indirect benefit from the
making of the extensions of credit under the Credit Agreement;
WHEREAS, the Credit Agreement requires the Additional Granting Party
to become a party to the Guarantee and Collateral Agreement; and
WHEREAS, the Additional Granting Party has agreed to execute and
deliver this Assumption Agreement in order to become a party to the Guarantee
and Collateral Agreement;
<PAGE>
2
NOW, THEREFORE, IT IS AGREED:
1. Guarantee and Collateral Agreement. By executing and delivering
this Assumption Agreement, the Additional Granting Party, as provided in Section
8.15 of the Guarantee and Collateral Agreement, hereby becomes a party to the
Guarantee and Collateral Agreement as a Granting Party thereunder with the same
force and effect as if originally named therein as a Guarantor [, Grantor and
Pledgor] [and Grantor] [and Pledgor](1) and, without limiting the generality of
the foregoing, hereby expressly assumes all obligations and liabilities of a
Guarantor [, Grantor and Pledgor] [and Grantor] [and Pledgor](2) thereunder. The
information set forth in Annex 1-A hereto is hereby added to the information set
forth in Schedules ____________ to the Guarantee and Collateral Agreement, and
such Schedules are hereby amended and modified to include such information. The
Additional Granting Party hereby represents and warrants that each of the
representations and warranties of such Additional Grantor, in its capacities as
a Guarantor [, Grantor and Pledgor] [and Grantor] [and Pledgor],(3) contained in
Section 4 of the Guarantee and Collateral Agreement is true and correct in all
material respects on and as the date hereof (after giving effect to this
Assumption Agreement) as if made on and as of such date.
2. Governing Law. THIS ASSUMPTION AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered as of the date first above written.
[ADDITIONAL GRANTING PARTY]
- ----------
(1) Indicate the capacities in which the Additional Granting Party is becoming
a Granting Party.
(2) Indicate the capacities in which the Additional Granting Party is becoming
a Granting Party.
(3) Indicate the capacities in which the Additional Granting Party is becoming
a Granting Party.
<PAGE>
3
By: _______________________________
Name:
Title:
<PAGE>
Annex 1-A to
Assumption Agreement
<PAGE>
TABLE OF CONTENTS
Page
SECTION 1. DEFINED TERMS....................................................2
1.1 Definitions.......................................................2
1.2 Other Definitional Provisions.....................................8
SECTION 2. GUARANTEE........................................................8
2.1 Guarantee.........................................................8
2.2 Right of Contribution.............................................9
2.3 No Subrogation....................................................9
2.4 Amendments, etc. with respect to the Borrower Obligations........10
2.5 Guarantee Absolute and Unconditional.............................10
2.6 Reinstatement....................................................11
2.7 Payments.........................................................11
SECTION 3. GRANT OF SECURITY INTEREST......................................12
3.1 Collateral.......................................................12
3.2 Pledged Collateral...............................................13
3.3 Certain Exceptions...............................................13
SECTION 4. REPRESENTATIONS AND WARRANTIES..................................14
4.1 Representations and Warranties of Each Guarantor.................14
4.2 Representations and Warranties of Each Grantor...................14
4.2.1 Title; No Other Liens....................................14
4.2.2 Perfected First Priority Liens...........................14
4.2.3 Chief Executive Office...................................16
4.2.4 Inventory and Equipment..................................16
4.2.5 Farm Products............................................16
4.2.6 Receivables..............................................16
4.2.7 Intellectual Property....................................17
4.2.8 Contracts................................................17
4.2.9 Vehicles.................................................18
4.3 Representations and Warranties of Each Pledgor...................18
SECTION 5. COVENANTS.......................................................19
5.1 Covenants of Each Guarantor......................................19
5.2 Covenants of Each Grantor........................................20
5.2.1 Delivery of Instruments and Chattel Paper................20
5.2.2 Maintenance of Insurance.................................20
5.2.3 Payment of Obligations...................................20
5.2.4 Maintenance of Perfected Security Interest;
Further Documentation ...................................21
5.2.5 Changes in Locations, Name, etc. ........................21
5.2.6 Notices..................................................22
5.2.7 Pledged Securities.......................................22
i
<PAGE>
5.2.8 Receivables..............................................22
5.2.9 Maintenance of Records...................................22
5.2.10 Intellectual Property...................................23
5.2.11 Protection of Trade Secrets.............................25
5.2.12 Contracts...............................................25
5.2.13 Vehicles................................................25
5.3 Covenants of Each Pledgor........................................26
5.4 Covenants of Holding.............................................27
5.4.1 Capital Contributions to the Parent Borrower.............27
5.4.2 Limitation on Activities of Holding......................28
SECTION 6. REMEDIAL PROVISIONS.............................................31
6.1 Certain Matters Relating to Receivables..........................31
6.2 Communications with Obligors; Grantors Remain Liable.............32
6.3 Pledged Stock....................................................32
6.4 Proceeds to be Turned Over To Administrative Agent...............33
6.5 Application of Proceeds..........................................34
6.6 Code and Other Remedies..........................................34
6.7 Registration Rights..............................................35
6.8 Waiver; Deficiency...............................................36
SECTION 7. THE ADMINISTRATIVE AGENT........................................36
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc......36
7.2 Duty of Administrative Agent.....................................38
7.3 Execution of Financing Statements................................39
7.4 Authority of Administrative Agent................................39
7.5 Right Of Inspection..............................................39
SECTION 8. MISCELLANEOUS...................................................40
8.1 Amendments in Writing............................................40
8.2 Notices..........................................................40
8.3 No Waiver by Course of Conduct; Cumulative Remedies..............40
8.4 Enforcement Expenses; Indemnification............................40
8.5 Successors and Assigns...........................................41
8.6 Set-Off..........................................................41
8.7 Counterparts.....................................................41
8.8 Severability.....................................................41
8.9 Section Headings.................................................42
8.10 Integration.....................................................42
8.11 GOVERNING LAW...................................................42
8.12 Submission To Jurisdiction; Waivers.............................42
8.13 Acknowledgments.................................................43
8.14 WAIVER OF JURY TRIAL............................................43
8.15 Additional Granting Parties.....................................43
8.16 Releases........................................................43
ii
<PAGE>
iii
<PAGE>
Page
iv
<PAGE>
Page
SCHEDULES
1 Notice Addresses of Guarantors
2 Description of Pledged Securities
3 Location of Jurisdiction of Organization and Chief Executive Office or
Sole Place of Business
4 Location of Inventory and Equipment
5 Copyrights and Copyright Licenses; Patents and Patent Licenses; Trademarks
and Trademark Licenses
6 Existing Prior Liens
7 Location of Records Concerning Receivables
8 Contracts
9 Vehicles
ANNEX
1 Assumption Agreement
v
<PAGE>
SCHEDULE 9
Vehicles
--------
See attached list.
<PAGE>
PAGE 1
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1A5371 TRAILER IN 95 KTY 1KKVE2811SL103483 HV CO CO 98050470300
1A5372 TRAILER IN 95 KTY 1KKVE2813SL103484 HV CO CO 98050470302
1A5373 TRAILER IN 95 KTY 1KKVE2815SL103485 HV CO CO 98050470303
1A5374 TRAILER IN 95 KTY 1KKVE2817SL103486 HV CO CO 98050470311
1A5375 TRAILER IN 95 KTY 1KKVE2819SL103487 HV CO CO 98050470312
1A5376 TRAILER IN 95 KTY 1KKVE2810SL103488 HV CO CO 98050470314
1A5377 TRAILER IN 95 KTY 1KKVE2812SL103489 HV CO CO 98050470316
1A5378 TRAILER IN 95 KTY 1KKVE2819SL103490 HV CO CO 98050470318
1A5379 TRAILER IN 95 KTY 1KKVE2810SL103491 HV CO CO 98050470319
1A5380 TRAILER IN 95 KTY 1KKVE2812SL103492 HV CO CO 98050470321
1A5381 TRAILER IN 95 KTY 1KKVE2814SL103493 HV CO CO 98050470328
1A5382 TRAILER IN 95 KTY 1KKVE2816SL103494 HV CO CO 98050470333
1A5383 TRAILER IN 95 KTY 1KKVE2818SL103495 HV CO CO 98050470334
1A5384 TRAILER IN 95 KTY 1KKVE281XSL103496 HV CO CO 98050470336
1A5385 TRAILER IN 95 KTY 1KKVE2811SL103497 HV CO CO 98050470338
1A5386 TRAILER IN 95 KTY 1KKVE2813SL103498 HV CO CO 98050470340
1A5387 TRAILER IN 95 KTY 1KKVE2815SL103499 HV CO CO 98050470342
1A5388 TRAILER IN 95 KTY 1KKVE2818SL103500 HV CO CO 98050470344
1A5389 TRAILER IN 95 KTY 1KKVE281XSL103501 HV CO CO 98050470346
1A5390 TRAILER IN 95 KTY 1KKVE2811SL103502 HV CO CO 98050470347
1A5391 TRAILER IN 95 KTY 1KKVE2813SL103503 HV CO CO 98050470349
1A5392 TRAILER IN 95 KTY 1KKVE2815SL103504 HV CO CO 98050470351
1A5393 TRAILER IN 95 KTY 1KKVE2817SL103505 HV CO CO 98050470352
1A5394 TRAILER IN 95 KTY 1KKVE2819SL103506 HV CO CO 98050470354
1A5396 TRAILER IN 95 KTY 1KKVE2810SL103507 HV CO CO 98050470356
1A5398 TRAILER IN 95 KTY 1KKVE2814SL103509 HV CO CO 98050470357
1A5399 TRAILER IN 95 KTY 1KKVE2810SL103510 HV CO CO 98050470362
1A5400 TRAILER IN 95 KTY 1KKVE2812SL103511 HV CO CO 98050470363
1A5401 TRAILER IN 95 KTY 1KKVE2814SL103512 HV CO CO 98050470364
1A5402 TRAILER IN 95 KTY 1KKVE2816SL103513 HV CO CO 98050470365
1A5403 TRAILER IN 95 KTY 1KKVE2818SL103514 HV CO CO 98050470366
1A5404 TRAILER IN 95 KTY 1KKVE281XSL103515 HV CO CO 98050470367
1A5405 TRAILER IN 95 KTY 1KKVE2811SL103516 HV CO CO 98050470369
1A5406 TRAILER IN 95 KTY 1KKVE2813SL103517 HV CO CO 98050470371
1A5407 TRAILER IN 95 KTY 1KKVE2815SL103518 HV CO CO 98050470373
1A5408 TRAILER IN 95 KTY 1KKVE2817SL103519 HV CO CO 98050470375
1A5409 TRAILER IN 95 KTY 1KKVE2813SL103520 HV CO CO 98050470377
1A5790 TRAILER IN 96 KTY 1KKVE2811TL105476 HV CO CO 98050470379
100124 TRAILER IN 86 STU 1TRBA2886GR000032 RS CO CO 98050470381
11A402 TRAILER IN 83 KTY 1KKVE4828DL000200 RS CO CO 98050470389
11A403 TRAILER IN 83 KTY 1KKVE482XDL000201 RS CO CO 98050470390
11A404 TRAILER IN 83 KTY 1KKVE4821DL000202 RS CO CO 98050470392
11A406 TRAILER IN 83 KTY 1KKVE4825DL000204 RS CL LA 98050470395
11A413 TRAILER IN 83 KTY 1KKVE4822DL000211 RS CO CO 98050470397
11A414 TRAILER IN 83 KTY 1KKVE4824DL000212 RS CO CO 98050470399
11A415 TRAILER IN 83 KTY 1KKVE4826DL000213 RS CO CO 98050470400
11A416 TRAILER IN 83 KTY 1KKVE4828DL000214 RS CO CO 98050470401
11A418 TRAILER IN 83 KTY 1KKVE4821DL000216 RS CL LA 98050470403
11A419 TRAILER IN 83 KTY 1KKVE4823DL000217 RS CL LA 98050470409
11A420 TRAILER IN 83 KTY 1KKVE4825DL000218 RS CL LA 98050470411
</TABLE>
<PAGE>
PAGE 2
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11A422 TRAILER IN 83 KTY 1KKVE4823DL000220 RS CL LA 98050470413
11A691 TRAILER IN 84 KTY 1KKVE4826EL069758 RS CL LA 98050470416
11A693 TRAILER IN 84 KTY 1KKVE4824EL069760 RS CL LA 98050470417
11A694 TRAILER IN 84 KTY 1KKVE4826EL069761 RS CL LA 98050470419
11B001 TRAILER IN 84 KTY 1KKVE4521EL069669 RS CO CO 98050470420
11B010 TRAILER IN 84 KTY 1KKVE4522EL069678 RS CO CO 98050470421
11B015 TRAILER IN 84 KTY 1KKVE4526EL069683 RS CO CO 98050470422
11B021 TRAILER IN 84 KTY 1KKVE4527EL069689 RS CO CO 98050470423
11B022 TRAILER IN 84 KTY 1KKVE4523EL069690 RS CL LA 98050470424
11B026 TRAILER IN 84 KTY 1KKVE4520EL069694 RS CO CO 98050470425
11B027 TRAILER IN 84 KTY 1KKVE4522EL069695 RS CL LA 98050470427
11B034 TRAILER IN 84 KTY 1KKVE4526EL069702 RS CO CO 98050470428
11B036 TRAILER IN 84 KTY 1KKVE452XEL069704 RS CL LA 98050470429
11B038 TRAILER IN 84 KTY 1KKVE4523EL069706 RS CO CO 98050470431
11B039 TRAILER IN 84 KTY 1KKVE4525EL069707 RS CO CO 98050470432
11B042 TRAILER IN 84 KTY 1KKVE4525EL069710 RS CO CO 98050470434
11B044 TRAILER IN 84 KTY 1KKVE4529EL069712 RS CO CO 98050470435
11B055 TRAILER IN 84 KTY 1KKVE4523EL069723 RS CO CO 98050470437
11B056 TRAILER IN 84 KTY 1KKVE4525EL069724 RS CL LA 98050470440
11B061 TRAILER IN 84 KTY 1KKVE4524EL069729 RS CO CO 98050470442
11B065 TRAILER IN 84 KTY 1KKVE4522EL069762 RS CO CO 98050470443
11B068 TRAILER IN 84 KTY 1KKVE4528EL069765 RS CO CO 98050470445
11B070 TRAILER IN 84 KTY 1KKVE4521EL069767 RS CO CO 98050470446
11B071 TRAILER IN 84 KTY 1KKVE4523EL069768 RS CO CO 98050470447
11B076 TRAILER IN 84 KTY 1KKVE4527EL069773 RS CO CO 98050470448
11B077 TRAILER IN 84 KTY 1KKVE4529EL069774 RS CO CO 98050470449
11B078 TRAILER IN 84 KTY 1KKVE4520EL069775 RS CO CO 98050470450
11B080 TRAILER IN 84 KTY 1KKVE4524EL069777 RS CO CO 98050470451
11B087 TRAILER IN 84 KTY 1KKVE4521EL069784 RS CO CO 98050470455
11B088 TRAILER IN 84 KTY 1KKVE4523EL069785 RS CO CO 98050470456
11B089 TRAILER IN 84 KTY 1KKVE4525EL069786 RS CO CO 98050470458
11B092 TRAILER IN 84 KTY 1KKVE4227EL069809 HV CO CO 98050470460
11B094 TRAILER IN 84 KTY 1KKVE4225EL069811 HV CO CO 98050470462
11B095 TRAILER IN 84 KTY 1KKVE4227EL069812 HV CO CO 98050470464
11B097 TRAILER IN 84 KTY 1KKVE4526EL069814 RS CO CO 98050470465
11B101 TRAILER IN 84 KTY 1KKVE4523EL069818 RS CO CO 98050470467
11B103 TRAILER IN 84 KTY 1KKVE4521EL069820 RS CO CO 98050470469
11B104 TRAILER IN 84 KTY 1KKVE4523EL069821 RS CO CO 98050470470
11B111 TRAILER IN 84 KTY 1KKVE4526EL069828 RS CO CO 98050470472
11B119 TRAILER IN 84 KTY 1KKVE4525EL069836 RS CO CO 98050470473
11B135 TRAILER IN 84 KTY 1KKVE4528EL069852 HV CO CO 98050470477
11B139 TRAILER IN 84 KTY 1KKVE4529EL071282 RS CO CO 98050470478
11B158 TRAILER IN 84 KTY 1KKVE4526EL071353 RS CO CO 98050470481
11B163 TRAILER IN 84 KTY 1KKVE4525EL071358 RS CO CO 98050470484
11B167 TRAILER IN 84 KTY 1KKVE4527EL071362 RS CO CO 98050470488
11B168 TRAILER IN 84 KTY 1KKVE4524EL071318 RS CO CO 98050472854
11B170 TRAILER IN 84 KTY 1KKVE4522EL071320 RS CO CO 98050472861
11B171 TRAILER IN 84 KTY 1KKVE4524EL071321 RS CO CO 98050472870
11B172 TRAILER IN 84 KTY 1KKVE4526EL071322 RS CO CO 98050472879
11B175 TRAILER IN 84 KTY 1KKVE4521EL071325 RS CO CO 98050472884
</TABLE>
<PAGE>
Page 3
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11B179 TRAILER IN 85 KTY 1KKVE4521FL073139 HV CO CO 98050472894
11B180 TRAILER IN 85 KTY 1KKVE4528FL073140 HV DC 12 98050472903
11B182 TRAILER IN 85 KTY 1KKVE4521FL073142 HV CO CO 98050472909
11B190 TRAILER IN 85 KTY 1KKVE4527FL073176 RS CL LA 98050472916
11B194 TRAILER IN 85 KTY 1KKVE4529FL073180 RS CO CO 98050472923
11B195 TRAILER IN 85 KTY 1KKVE4520FL073181 RS CO CO 98050472928
11B198 TRAILER IN 85 KTY 1KKVE4526FL073184 RS CO CO 98050472936
11B202 TRAILER IN 85 KTY 1KKVE4523FL073188 RS CO CO 98050472942
11B205 TRAILER IN 85 KTY 1KKVE4523FL073191 RS CO CO 98050472950
11B207 TRAILER IN 85 KTY 1KKVE4527FL073193 RS CO CO 98050472955
11B208 TRAILER IN 85 KTY 1KKVE4529FL073194 HV AG LF 98050472963
11B213 TRAILER IN 85 KTY 1KKVE4528FL073199 RS CO CO 98050472968
11B217 TRAILER IN 85 KTY 1KKVE4526FL073203 RS CO CO 98050472974
11B220 TRAILER IN 85 KTY 1KKVE4525FL073211 RS CO CO 98050142076
11B221 TRAILER IN 85 KTY 1KKVE4527FL073212 RS CO CO 98050473020
11B224 TRAILER IN 85 KTY 1KKVE4522FL073215 RS CO CO 98050473025
11B226 TRAILER IN 85 KTY 1KKVE4529FL073227 RS CO CO 98050473032
11B228 TRAILER IN 85 KTY 1KKVE4522FL073229 RS CO CO 98050473040
11B229 TRAILER IN 85 KTY 1KKVE4529FL073230 RS CO CO 98050473046
11B230 TRAILER IN 85 KTY 1KKVE4520FL073231 RS CO CO 98050473051
11B234 TRAILER IN 85 KTY 1KKVE4528FL073235 RS CO CO 98050473056
11B237 TRAILER IN 85 KTY 1KKVE4523FL073238 RS CL LA 98050473064
11B240 TRAILER IN 85 KTY 1KKVE4522FL074204 RS CO CO 98050473072
11B245 TRAILER IN 85 KTY 1KKVE4521FL074209 RS CO CO 98050473079
11B249 TRAILER IN 85 KTY 1KKVE4523FL074213 RS CO CO 98050473090
11B250 TRAILER IN 85 KTY 1KKVE4525FL074214 RS CO CO 98050473096
11B256 TRAILER IN 85 KTY 1KKVE4520FL074220 RS CO CO 98050473103
11B267 TRAILER IN 85 KTY 1KKVE4525FL074231 RS CO CO 98050473110
11B268 TRAILER IN 85 KTY 1KKVR4520FL074576 HV CO CO 98050473120
11B269 TRAILER IN 85 KTY 1KKVR4522FL074577 HV CO CO 98050473128
11C425 TRAILER IN 83 KTY 1KKVE4828DL001122 RS CO CO 98050473136
11C426 TRAILER IN 83 KTY 1KKVE482XDL001123 RS CL LA 98050473143
11C427 TRAILER IN 83 KTY 1KKVE4821DL001124 RS CO CO 98050473151
11C428 TRAILER IN 83 KTY 1KKVE4823DL001125 RS CL LA 98050473159
11C429 TRAILER IN 83 KTY 1KKVE4825DL001126 RS CL LA 98050473165
11C430 TRAILER IN 83 KTY 1KKVE4827DL001127 RS CL LA 98050473173
11C431 TRAILER IN 83 KTY 1KKVE4829DL001128 RS CL LA 98050473179
11C432 TRAILER IN 83 KTY 1KKVE4820DL001129 RS CO CO 98050473190
11C433 TRAILER IN 83 KTY 1KKVE4827DL001130 RS CO CO 98050473196
11C434 TRAILER IN 83 KTY 1KKVE4820DL001132 RS CL LA 98050473203
11C435 TRAILER IN 83 KTY 1KKVE4822DL001133 RS CL LA 98050473960
11C436 TRAILER IN 83 KTY 1KKVE4824DL001134 RS CO CO 98050473211
11C438 TRAILER IN 83 KTY 1KKVE4828DL001136 RS CO CO 98050473216
11C439 TRAILER IN 83 KTY 1KKVE4821DL001138 RS CL LA 98050473233
11C441 TRAILER IN 83 KTY 1KKVE482XDL001140 RS CL LA 98050473247
11C442 TRAILER IN 83 KTY 1KKVE4821DL001141 RS CO CO 98050473225
11C443 TRAILER IN 83 KTY 1KKVE4823DL001142 RS CO CO 98050472055
11C445 TRAILER IN 83 KTY 1KKVE4828DL001153 RS CL LA 98050473957
11C446 TRAILER IN 83 KTY 1KKVE482XDL001154 RS CO CO 98050473958
11C447 TRAILER IN 83 KTY 1KKVE4821DL001155 RS CO CO 98050472062
</TABLE>
<PAGE>
PAGE 4
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11C448 TRAILER IN 83 KTY IKKVE4823DL001156 RS CL LA 98050473959
11C449 TRAILER IN 83 KTY 1KKVE4825DL001157 RS CL LA 98050472068
11C451 TRAILER IN 83 KTY 1KKVE4829DL001159 RS CL LA 98050472076
11C654 TRAILER IN 84 KTY 1KKVE4822EL069787 RS CO CO 84184091141
11C656 TRAILER IN 84 KTY 1KKVE4826EL069789 RS CL LA 98050472085
11C659 TRAILER IN 84 KTY 1KKVE4826EL069792 HV CO CO 98050472093
11C669 TRAILER IN 84 KTY 1KKVE4825EL069802 RS CO CO 98050472100
11C670 TRAILER IN 84 KTY 1KKVE4827EL069803 RS CO CO 98050472107
11C673 TRAILER IN 84 KTY 1KKVE4822EL069806 RS CL LA 98050472114
11E313 TRAILER IN 85 DOR 1DTV51X26FA168076 HV CO CO 98050472120
11E320 TRAILER IN 85 DOR 1DTV51X23FA168083 HV CO CO 98050472128
11F001 TRAILER IN 85 KTY 1KKVE4821FL073038 RS CO CO 98050472132
11F002 TRAILER IN 85 KTY 1KKVE4823FL073039 RS CO CO 98050472140
11F003 TRAILER IN 85 KTY 1KKVE482XFL073040 RS CO CO 98050472148
11F004 TRAILER IN 85 KTY 1KKVE4821FL073041 RS CO CO 98050472155
11F005 TRAILER IN 85 KTY 1KKVE4823FL073042 HV CO CO 98050472162
11F008 TRAILER IN 85 KTY 1KKVE4829FL073045 HV CO CO 98050472165
11F009 TRAILER IN 85 KTY 1KKVE4820FL073046 RS CO CO 98050472170
11F010 TRAILER IN 85 KTY 1KKVE4822FL073047 HV CO CO 98050472177
11F011 TRAILER IN 85 KTY 1KKVE4824FL073048 HV CO CO 98050472186
11F012 TRAILER IN 85 KTY 1KKVE4826FL073049 RS CO CO 98050472195
11F013 TRAILER IN 85 KTY 1KKVE4822FL073050 RS CO CO 98050472202
11F014 TRAILER IN 85 KTY 1KKVE4824FL073051 HV CO CO 98050472209
11F016 TRAILER IN 85 KTY 1KKVE4828FL073053 RS CL LA 98050472223
11F017 TRAILER IN 85 KTY 1KKVE482XFL073054 RS CO CO 98050472231
11F018 TRAILER IN 85 KTY 1KKVE4821FL073055 RS CO CO 98050472238
11F019 TRAILER IN 85 KTY 1KKVE4823FL073056 RS CO CO 98050472244
11F020 TRAILER IN 85 KTY 1KKVE4825FL073057 RS CO CO 98050472252
11F021 TRAILER IN 85 KTY 1KKVE4827FL073058 RS CO CO 98050472283
11F022 TRAILER IN 85 KTY 1KKVE4829FL073059 RS CO CO 98050472289
11F023 TRAILER IN 85 KTY 1KKVE4825FL073060 RS CO CO 98050472295
11F024 TRAILER IN 85 KTY 1KKVE4827FL073061 HV CO CO 98050472302
11F025 TRAILER IN 85 KTY 1KKVE4829FL073062 HV CO CO 98050472309
11F026 TRAILER IN 85 KTY 1KKVE4820FL073063 RS CO CO 98050472318
11F027 TRAILER IN 85 KTY 1KKVE4822FL073064 RS CO CO 98050472325
11F029 TRAILER IN 85 KTY 1KKVE4826FL073066 RS CO CO 98050472330
11F030 TRAILER IN 85 KTY 1KKVE4828FL073067 RS CO CO 98050472336
11F032 TRAILER IN 85 KTY 1KKVE4821FL073069 HV CO CO 98050472345
11F033 TRAILER IN 85 KTY 1KKVE4828FL073070 HV CO CO 98050472352
11F034 TRAILER IN 85 KTY 1KKVE482XFL073071 HV CO CO 98050472362
11F035 TRAILER IN 85 KTY 1KKVE4821FL073072 HV CL LA 98050472372
11F036 TRAILER IN 85 KTY 1KKVE4823FL073073 HV CO CO 98050472381
11F037 TRAILER IN 85 KTY 1KKVE4825FL073074 RS CO CO 98050472388
11F038 TRAILER IN 85 KTY 1KKVE4827FL073075 HV CO CO 98050472395
11F040 TRAILER IN 85 KTY 1KKVE4820FL073077 HV CO CO 98050472404
11F041 TRAILER IN 85 KTY 1KKVE4822FL073078 RS CO CO 98050472410
11F042 TRAILER IN 85 KTY 1KKVE4824FL073079 RS CO CO 98050472416
11F043 TRAILER IN 85 KTY 1KKVE4820FL073080 HV CO CO 98050472423
11F044 TRAILER IN 85 KTY 1KKVE4822FL073081 RS CO CO 98050472069
11F046 TRAILER IN 85 KTY 1KKVE4826FL073083 HV CO CO 98050472088
</TABLE>
<PAGE>
Page 5
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11F047 TRAILER IN 85 KTY 1KKVE4828FL073084 RS CO CO 98050472109
11F048 TRAILER IN 85 KTY 1KKVE482XFL073085 RS CO CO 98050472138
11F049 TRAILER IN 85 KTY 1KKVE4821FL073086 RS CO CO 98050472157
11F050 TRAILER IN 85 KTY 1KKVE4823FL073087 RS CO CO 98050472171
11F052 TRAILER IN 85 KTY 1KKVE4827FL073089 RS CO CO 98050472185
11F054 TRAILER IN 85 KTY 1KKVE4825FL073091 RS CL LA 98050472205
11F055 TRAILER IN 85 KTY 1KKVE4827FL073092 RS CO CO 98050472219
11F056 TRAILER IN 85 KTY 1KKVE4829FL073093 RS CO CO 98050472230
11F057 TRAILER IN 85 KTY 1KKVE4820FL073094 RS CO CO 98050472247
11F058 TRAILER IN 85 KTY 1KKVE4822FL073095 HV CO CO 98050472259
11F059 TRAILER IN 85 KTY 1KKVE4824FL073096 RS CO CO 98050472273
11F060 TRAILER IN 85 KTY 1KKVE4826FL073097 HV CO CO 98050472285
11F061 TRAILER IN 85 KTY 1KKVE4828FL073098 HV CO CO 98050472301
11F062 TRAILER IN 85 KTY 1KKVE482XFL073099 HV CL LA 98050472313
11F064 TRAILER IN 85 KTY 1KKVE4824FL073101 HV CL LA 98050472326
11F065 TRAILER IN 85 KTY 1KKVE4826FL073102 HV CO CO 98050472343
11F066 TRAILER IN 85 KTY IKKVE4828FL073103 RS CO CO 98050472357
11FO67 TRAILER IN 85 KTY IKKVE482XFL073104 HV CL LA 98050472376
11FO68 TRAILER IN 85 KTY IKKVE4821FL073105 HV CO CO 98050472389
11FO70 TRAILER IN 85 KTY IKKVR4825FL073107 HV CO CO 98050472406
11FO71 TRAILER IN 85 KTY IKKVE4827FL073108 HV CO CO 98050472422
11FO72 TRAILER IN 85 KTY IKKVE4829FL073109 HV CO CO 98050472435
11F073 TRAILER IN 85 KTY IKKVE4825FL073110 HV CO CO 98050472449
11FO74 TRAILER IN 85 KTY IKKVE4827FL073111 HV CL LA 98050472458
11F075 TRAILER IN 85 KTY IKKVE4829FL073112 HV CO CO 98050472469
11FO76 TRAILER IN 85 KTY IKKVE4820FL073113 HV CO CO 98050472479
11FO77 TRAILER IN 85 KTY IKKVE4822FL073114 HV CO CO 98050472487
11FO78 TRAILER IN 85 KTY IKKVE4824FL073115 HV CO CO 98050472506
11F079 TRAILER IN 85 KTY IKKVE4826FL073116 HV CO CO 98050472518
11FO80 TRAILER IN 85 KTY IKKVE4828FL073117 HV CO CO 98050472532
11FO81 TRAILER IN 85 KTY IKKVE482XFL073118 HV CO CO 98050472551
11FO82 TRAILER IN 85 KTY IKKVE4821FL073119 HV CO CO 98050472571
11FO83 TRAILER IN 85 KTY IKKVE4828FL073120 HV CO CO 98050472583
11FO84 TRAILER IN 85 KTY IKKVE482XFL073121 HV CO CO 98050472597
11FO85 TRAILER IN 85 KTY IKKVE4821FL073122 HV CO CO 98050472608
11FO86 TRAILER IN 85 KTY IKKVE4823FL073123 HV CL LA 98050472622
11F087 TRAILER IN 85 KTY IKKVE4825FL073124 RS CO CO 98050472636
11FO88 TRAILER IN 85 KTY IKKVE4827FL073125 HV CO CO 98050472649
11FO89 TRAILER IN 85 KTY IKKVE4829FL073126 RS CL LA 98050472658
11FO90 TRAILER IN 85 KTY IKKVE4820FL073127 HV CO CO 98050472671
11F091 TRAILER IN 85 KTY IKKVE4822FL073128 HV CO CO 98050472683
11FO92 TRAILER IN 85 KTY IKKVE4824FL073129 RS CO CO 98050472697
11F093 TRAILER IN 85 KTY IKKVE4820FL073130 HV CO CO 98050472714
11FO94 TRAILER IN 85 KTY IKKVE4822FL073131 HV CO CO 98050472729
11FO95 TRAILER IN 85 KTY IKKVE4824FL073132 RS CO CO 98050472740
11F096 TRAILER IN 85 KTY IKKVE4826FL073133 RS CO CO 98050472755
11F097 TRAILER IN 85 KTY IKKVE4828FL073134 RS CO CO 98050472785
11F098 TRAILER IN 85 KTY IKKVE482XFL073155 RS CO CO 98050472768
11H420 TRAILER IN 92 KTY IKKVR482XNL092206 HV CO CO 98050470510
11H421 TRAILER IN 92 KTY IKKVR4821NL092207 HV CO CO 98050470511
</TABLE>
<PAGE>
Page 6
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- --- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H422 TRAILER IN 92 KTY 1KKVR4823NL092208 HV CO CO 98050470512
11H423 TRAILER IN 92 KTY 1KKVR4825NL099209 HV CO CO 98050470513
11H424 TRAILER IN 92 KTY 1KKVR4821NL092210 HV CO CO 98050470514
11H425 TRAILER IN 92 KTY 1KKVR4823NL092211 HV CO CO 98050470515
11H426 TRAILER IN 92 KTY 1KKVR4825NL092212 HV CO CO 98050470516
11H427 TRAILER IN 92 KTY 1KKVR4827NLO92213 HV CO CO 98050470517
11H428 TRAILER IN 92 KTY 1KKVR4829NL092214 HV CO CO 98050470518
11H429 TRAILER IN 92 KTY 1KKVR4820NL092215 HV CO CO 98050470519
11H430 TRAILER IN 92 KTY 1KKVR4822NL092216 HV CO CO 98050470520
11H431 TRAILER IN 92 KTY 1KKVR4824NL092217 HV CO CO 98050470521
11H432 TRAILER IN 92 KTY 1KKVR4826NL092218 HV CO CO 98050470522
11H433 TRAILER IN 92 KTY 1KKVR4828NLO92219 HV CO CO 98050470523
11H434 TRAILER IN 92 KTY 1KKVR4824NL092220 HV CO CO 98050470524
11H435 TRAILER IN 92 KTY 1KKVR4826NL092221 HV CO CO 98050470525
11H436 TRAILER IN 92 KTY 1KKVR4828NL092222 HV CO CO 98050470526
11H437 TRAILER IN 93 KTY 1KKVR4723PL095498 HV CO CO 98050470527
11H438 TRAILER IN 93 KTY 1KKVR4725PL095499 HV CO CO 98050470528
11H439 TRAILER IN 92 KTY 1KKVE4829NL092225 HV CO CO 98050470529
11H440 TRAILER IN 92 KTY 1KKVE4820NL092226 HV CO CO 98050470530
11H441 TRAILER IN 92 KTY 1KKVE4822NL092227 HV CO CO 98050470531
11H442 TRAILER IN 92 KTY 1KKVE4824NL092228 HV CO CO 98050470532
11H443 TRAILER IN 92 KTY 1KKVE4826NL092229 HV CO CO 98050470533
11H444 TRAILER IN 92 KTY 1KKVE4822NL092230 HV CO CO 98050470534
11H445 TRAILER IN 92 KTY 1KKVE4824NL092231 HV CO CO 98050470535
11H446 TRAILER IN 92 KTY 1KKVE4826NL092232 HV CO CO 98050470536
11H447 TRAILER IN 92 KTY 1KKVE4828NL092233 HV CO CO 98050470539
11H448 TRAILER IN 92 KTY 1KKVE482XNL092234 HV CO CO 98050470541
11H449 TRAILER IN 92 KTY 1KKVE4821NL092235 HV CO CO 98050470543
11H450 TRAILER IN 92 KTY 1KKVE4823NL092236 HV CO CO 98050470545
11H451 TRAILER IN 92 KTY 1KKVE4825NL092237 HV CO CO 98050470547
11H452 TRAILER IN 92 KTY 1KKVE4827NL092238 HV CO CO 98050470549
11H453 TRAILER IN 92 KTY 1KKVE4829NL092239 HV CO CO 98050470551
11H454 TRAILER IN 92 KTY 1KKVE4825NL092240 HV CO CO 98050470553
11H455 TRAILER IN 92 KTY 1KKVE4827NL092241 HV CO CO 98050470555
11H456 TRAILER IN 92 KTY 1KKVE4829NL092242 HV CO CO 98050470557
11H457 TRAILER IN 92 KTY 1KKVE4820NL092243 HV CO CO 98050470559
11H458 TRAILER IN 92 KTY 1KKVE4822NL092244 HV CO CO 98050470561
11H459 TRAILER IN 92 KTY 1KKVE4824NLO92245 HV CO CO 98050470562
11H460 TRAILER IN 92 KTY 1KKVE4826NL092246 HV CL LA 98050470563
11H461 TRAILER IN 92 KTY 1KKVE4828NL092247 HV CO CO 98050470566
11H462 TRAILER IN 92 KTY 1KKVE482XNL092248 HV CO CO 98050470567
11H463 TRAILER IN 92 KTY 1KKVE4821NL092249 HV CO CO 98050470569
11H464 TRAILER IN 92 KTY 1KKVE4828NL092250 HV CL LA 98050470571
11H465 TRAILER IN 92 KTY 1KKVE482XNL092251 HV CO CO 98050470573
11H466 TRAILER IN 92 KTY 1KKVE4821NL092252 HV CO CO 98050470574
11H467 TRAILER IN 92 KTY 1KKVE4823NL092253 HV CO CO 98050470576
11H468 TRAILER IN 92 KTY 1KKVE4825NL092254 HV CO CO 98050470578
11H469 TRAILER IN 92 KTY 1KKVE4827NL092255 HV CO CO 98050470581
11H470 TRAILER IN 92 KTY 1KKVE4829NL092256 HV CO CO 98050470407
11H471 TRAILER IN 92 KTY 1KKVE4820NL092257 HV CO CO 98050470408
</TABLE>
<PAGE>
PAGE 7
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H472 TRAILER IN 92 KTY 1KKVE4822NL092258 HV CO CO 98050470466
11H473 TRAILER IN 92 KTY 1KKVE4824NL092259 HV CO CO 98050470412
11H474 TRAILER IN 92 KTY 1KKVE4820NL092260 HV CL LA 98050470414
11H475 TRAILER IN 92 KTY 1KKVE4822NL092261 HV CL LA 98050470415
11H476 TRAILER IN 92 KTY 1KKVE4824NL092262 HV CO CO 98050470418
11H477 TRAILER IN 92 KTY 1KKVE4826NL092263 HV CO CO 98050470426
11H478 TRAILER IN 92 KTY 1KKVE4828NL092264 HV CO CO 98050470430
11H479 TRAILER IN 92 KTY 1KKVE482XNL092265 HV CO CO 98050470433
11H480 TRAILER IN 92 KTY 1KKVE4821NL092266 HV CO CO 98050470436
11H481 TRAILER IN 92 KTY 1KKVE4823NL092267 HV CO CO 98050470438
11H482 TRAILER IN 92 KTY 1KKVE4825NL092268 HV CO CO 98050470439
11H483 TRAILER IN 92 KTY 1KKVE4827NL092269 HV CO CO 98050470441
11H484 TRAILER IN 92 KTY 1KKVE4823NL092270 HV CO CO 98050470444
11H485 TRAILER IN 92 KTY 1KKVE4825NL092271 RS CO CO 98050470452
11H486 TRAILER IN 92 KTY 1KKVE4827NL092272 HV CO CO 98050470453
11H487 TRAILER IN 92 KTY 1KKVE4829NL092273 HV CO CO 98050470454
11H488 TRAILER IN 92 KTY 1KKVE4820NL092274 HV CO CO 98050470457
11H489 TRAILER IN 92 KTY 1KKVE4822NL092275 HV CO CO 98050470459
11H490 TRAILER IN 92 KTY 1KKVE4824NL092276 HV CO CO 98050470461
11H491 TRAILER IN 92 KTY 1KKVE4826NL092277 HV CL LA 98050470463
11H492 TRAILER IN 92 KTY 1KKVE4828NL092278 HV CO CO 98050470468
11H493 TRAILER IN 92 KTY 1KKVE482XNL092279 HV CO CO 98050470471
11H494 TRAILER IN 92 KTY 1KKVE4826NL092280 HV CO CO 98050470474
11H495 TRAILER IN 92 KTY 1KKVE4828NL092281 HV CO CO 98050470476
11H496 TRAILER IN 92 KTY 1KKVE482XNL092282 HV CO CO 98050470479
11H497 TRAILER IN 92 KTY 1KKVE4821NL092283 HV CL LA 98050470483
11H498 TRAILER IN 92 KTY 1KKVE4823NL092284 HV CO CO 98050470485
11H499 TRAILER IN 92 KTY 1KKVE4825NL092285 HV CO CO 98050470487
11H500 TRAILER IN 92 KTY 1KKVE4827NL092286 HV CO CO 98050470489
11H501 TRAILER IN 92 KTY 1KKVE4829NL092287 HV CO CO 98050470490
11H502 TRAILER IN 92 KTY 1KKVE482ONL092288 HV CO CO 98050470491
11H503 TRAILER IN 92 KTY 1KKVE4822NL092289 HV CO CO 98050470492
11H504 TRAILER IN 92 KTY 1KKVE4829NL092290 HV CO CO 98050470493
11H505 TRAILER IN 92 KTY 1KKVE4820NL092291 RS CO CO 98050470495
11H506 TRAILER IN 92 KTY 1KKVE4822NL092292 HV CO CO 98050470496
11H507 TRAILER IN 92 KTY 1KKVE4824NL092293 HV CL LA 98050470497
11H508 TRAILER IN 92 KTY 1KKVE4826NL092294 HV CO CO 98050470498
11H509 TRAILER IN 92 KTY 1KKVE4828NL092295 HV CO CO 98050470499
11H510 TRAILER IN 92 KTY 1KKVE482XNL092296 HV CL LA 98050470500
11H511 TRAILER IN 92 KTY 1KKVE4821NL092297 HV CO CO 98050470501
11H512 TRAILER IN 92 KTY 1KKVE4823NL092298 HV CO CO 98050470502
11H513 TRAILER IN 92 KTY 1KKVE4825NL092299 HV CO CO 98050470503
11H514 TRAILER IN 92 KTY 1KKVE4828NL092300 HV CO CO 98050470504
11H515 TRAILER IN 92 KTY 1KKVE482XNL092301 HV CO CO 98050470505
11H516 TRAILER IN 92 KTY 1KKVE4821NL092302 HV CO CO 98050470506
11H517 TRAILER IN 92 KTY 1KKVE4823NL092303 HV CL LA 98050470507
11H518 TRAILER IN 92 KTY 1KKVE4825NL092304 HV CO CO 98050470508
11H519 TRAILER IN 92 KTY 1KKVE4827NL092305 HV CL LA 98050470509
11H520 TRAILER IN 92 KTY 1KKVE4829NL092306 HV CL LA 98050470310
11H521 TRAILER IN 92 KTY 1KKVE4820NL092307 HV CO CO 98050470313
</TABLE>
<PAGE>
Page 8
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H522 TRAILER IN 92 KTY 1KKVE4822NL092308 HV CO CO 98050470315
11H523 TRAILER IN 92 KTY 1KKVE4824NL092309 HV CO CO 98050470317
11H524 TRAILER IN 92 KTY 1KKVE4820NLO92310 HV CO CO 98050470320
11H525 TRAILER IN 92 KTY 1KKVE4822NL092311 HV CO CO 98050470322
11H526 TRAILER IN 92 KTY 1KKVE4824NL092312 HV CL LA 98050470323
11H527 TRAILER IN 92 KTY 1KKVE4826NL092313 HV CO CO 98050470324
11H528 TRAILER IN 92 KTY 1KKVE4828NL092314 RS CO CO 98050470325
11H529 TRAILER IN 92 KTY 1KKVE482XNL092315 HV CO CO 98050470326
11H530 TRAILER IN 92 KTY 1KKVE4821NL092316 HV CO CO 98050470327
11H531 TRAILER IN 92 KTY 1KKVE4823NL092317 HV CO CO 98050470329
11H532 TRAILER IN 92 KTY 1KKVE4825NL092318 HV CO CO 98050470330
11H533 TRAILER IN 92 KTY 1KKVE4827NL092319 HV CO CO 98050470331
11H534 TRAILER IN 92 KTY 1KKVE4823NL092320 HV CO CO 98050470332
11H536 TRAILER IN 92 KTY 1KKVE4827NL092322 HV CO CO 98050470335
11H537 TRAILER IN 92 KTY 1KKVE4829NL092323 HV CO CO 98050470337
11H538 TRAILER IN 92 KTY 1KKVE4820NLO92324 HV CO CO 98050470339
11H539 TRAILER IN 92 KTY 1KKVE4822NL092325 HV CO CO 98050470341
11H540 TRAILER IN 92 KTY 1KKVE4824NL092326 HV CO CO 98050470343
11H541 TRAILER IN 92 KTY 1KKVE4826NL092327 HV CO CO 98050470345
11H542 TRAILER IN 92 KTY 1KKVE4828NL092328 HV CO CO 98050470348
11H543 TRAILER IN 92 KTY 1KKVE482XNL092329 HV CO CO 98050470350
11H544 TRAILER IN 92 KTY 1KKVE4826NL092330 HV CO CO 98050470353
11H545 TRAILER IN 92 KTY 1KKVE4828NL092331 HV CO CO 98050470355
11H546 TRAILER IN 92 KTY 1KKVE482XNL092332 HV CO CO 98050470358
11H547 TRAILER IN 92 KTY 1KKVE4821NL092333 HV CO CO 98050470359
11H548 TRAILER IN 92 KTY 1KKVE4823NL092334 HV CO CO 98050470360
11H549 TRAILER IN 92 KTY 1KKVE4825NLO92335 HV CO CO 98050470361
11H550 TRAILER IN 92 KTY 1KKVE4827NL092336 HV CO CO 98050470368
11H551 TRAILER IN 92 KTY 1KKVE4829NL092337 HV CO CO 98050470370
11H552 TRAILER IN 92 KTY 1KKVE4820NL092338 HV CO CO 98050470372
11H553 TRAILER IN 92 KTY 1KKVE4822NL092339 HV CO CO 98050470374
11H554 TRAILER IN 92 KTY 1KKVE4829NL092340 HV CO CO 98050470376
11H555 TRAILER IN 92 KTY 1KKVE4820NL092341 HV CO CO 98050470378
11H556 TRAILER IN 92 KTY 1KKVE4822NL092342 HV CO CO 98050470380
11H557 TRAILER IN 92 KTY 1KKVE4824NL092343 HV CO CO 98050470382
11H558 TRAILER IN 92 KTY 1KKVE4826NL092344 HV CO CO 98050470384
11H560 TRAILER IN 92 KTY 1KKVE482XNL092346 HV CO CO 98050470385
11H561 TRAILER IN 92 KTY 1KKVE4821NL092347 HV CO CO 98050470386
11H562 TRAILER IN 92 KTY 1KKVE4823NL092348 HV CO CO 98050470387
11H563 TRAILER IN 92 KTY 1KKVE4825NL092349 HV CO CO 98050470388
11H564 TRAILER IN 92 KTY 1KKVE4821NL092350 HV CO CO 98050470391
11H565 TRAILER IN 92 KTY 1KKVE4823NL092351 HV CO CO 98050470394
11H566 TRAILER IN 92 KTY 1KKVE4825NL092352 HV CO CO 98050470396
11H567 TRAILER IN 92 KTY 1KKVE4827NL092353 HV CO CO 98050470398
11H568 TRAILER IN 92 KTY 1KKVE4829NL092354 HV CO CO 98050470402
11H569 TRAILER IN 92 KTY 1KKVE4820NL092355 HV CO CO 98050470404
11H570 TRAILER IN 92 KTY 1KKVE4822NL092356 HV CO CO 98050470405
11H571 TRAILER IN 92 KTY 1KKVE4824NL092357 HV CO CO 98050470406
11H572 TRAILER IN 92 KTY 1KKVE4826NL092358 HV CO CO 98050470001
11H573 TRAILER IN 92 KTY 1KKVE4828NL092359 HV CO CO 98050470002
</TABLE>
<PAGE>
PAGE 9
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H574 TRAILER IN 92 KTY 1KKVE4824NL092360 HV CO CO 98050470003
11H575 TRAILER IN 92 KTY 1KKVE4826NL092361 HV CO CO 98050470005
11H576 TRAILER IN 92 KTY 1KKVE4828NL092362 HV CO CO 98050470006
11H577 TRAILER IN 92 KTY 1KKVE482XNL092363 HV CL LA 98050470007
11H578 TRAILER IN 92 KTY 1KKVE4821NL092364 HV CO CO 98050470008
11H579 TRAILER IN 92 KTY 1KKVE4823NL092365 HV CO CO 98050470009
11H580 TRAILER IN 92 KTY 1KKVE4825NL092366 HV CO CO 98050470010
11H581 TRAILER IN 92 KTY 1KKVE4827NL092367 HV CO CO 98050470011
11H582 TRAILER IN 92 KTY 1KKVE4829NL092368 HV CL LA 98050470013
11H583 TRAILER IN 92 KTY 1KKVE4820NL092369 HV CO CO 98050470015
11H585 TRAILER IN 92 KTY 1KKVE4829NL092371 HV CO CO 98050470018
11H586 TRAILER IN 92 KTY 1KKVE4820NL092372 HV CO CO 98050470019
11H587 TRAILER IN 92 KTY 1KKVE4822NL092373 HV CO CO 98050470021
11H588 TRAILER IN 92 KTY 1KKVE4824NL092374 HV CO CO 98050470023
11H589 TRAILER IN 92 KTY 1KKVE4826NL092375 HV CO CO 98050470024
11H590 TRAILER IN 92 KTY 1KKVE4828NL092376 HV CO CO 98050470026
11H591 TRAILER IN 92 KTY 1KKVE482XNL092377 HV CO CO 98050470027
11H592 TRAILER IN 92 KTY 1KKVE4821NL092378 HV CO CO 98050470029
11H593 TRAILER IN 92 KTY 1KKVE4823NL092379 HV CO CO 98050470031
11H594 TRAILER IN 92 KTY 1KKVE482XNL092380 HV CO CO 98050470033
11H595 TRAILER IN 92 KTY 1KKVE4821NL092381 HV CO CO 98050470035
11H596 TRAILER IN 92 KTY 1KKVE4823NL092382 HV CO CO 98050470037
11H597 TRAILER IN 92 KTY 1KKVE4825NL092383 HV CO CO 98050470038
11H598 TRAILER IN 92 KTY 1KKVE4827NL092384 HV CO CO 98050470040
11H599 TRAILER IN 92 KTY 1KKVE4829NL092385 HV CO CO 98050470042
11H600 TRAILER IN 92 KTY 1KKVE4820NL092386 HV CO CO 98050470043
11H601 TRAILER IN 92 KTY 1KKVE4822NL092387 HV CO CO 98050470045
11H611 TRAILER IN 93 KTY 1KKVE2818PL093297 HV CO CO 98050470052
11H613 TRAILER IN 93 KTY 1KKVE2811PL093299 HV DC 08 98050470053
11H615 TRAILER IN 93 KTY 1KKVE2816PL093301 HV DC 02 98050470055
11H617 TRAILER IN 93 KTY 1KKVE281XPL093303 HV CO CO 98050470057
11H618 TRAILER IN 93 KTY 1KKVE2811PL093304 HV CO CO 98050470059
11H619 TRAILER IN 93 KTY 1KKVE2813PL093305 HV CO CO 98050470062
11H620 TRAILER IN 93 KTY 1KKVE2815PL093306 HV CO CO 98050470064
11H621 TRAILER IN 93 KTY 1KKVE2817PL093307 HV CO CO 98050470065
11H622 TRAILER IN 93 KTY 1KKVE2819PL093308 HV CO CO 98050470067
11H626 TRAILER IN 93 KTY 1KKVE2810PL093312 HV DC 02 98050470070
11H627 TRAILER IN 93 KTY 1KKVE4820PL093475 HV CO CO 98050470072
11H629 TRAILER IN 93 KTY 1KKVE4824PL093477 HV CO CO 98050470074
11H630 TRAILER IN 93 KTY 1KKVE4826PL093478 HV CO CO 98050470076
11H631 TRAILER IN 93 KTY 1KKVE4828PL093479 HV CO CO 98050470078
11H632 TRAILER IN 93 KTY 1KKVE4824PL093480 HV CO CO 98050470083
11H633 TRAILER IN 93 KTY 1KKVE4826PL093481 HV CO CO 98050470081
11H635 TRAILER IN 93 KTY 1KKVE482XPL093483 HV CO CO 98050470085
11H636 TRAILER IN 93 KTY 1KKVE4821PL093484 HV CO CO 98050470086
11H637 TRAILER IN 93 KTY 1KKVE4823PL093485 HV CO CO 98050470004
11H638 TRAILER IN 93 KTY 1KKVE4825PL093486 HV CO CO 98050470012
11H639 TRAILER IN 93 KTY 1KKVE4827PL093487 HV CO CO 98050470014
11H640 TRAILER IN 93 KTY 1KKVE4829PL093488 HV CO CO 98050470017
11H641 TRAILER IN 93 KTY 1KKVE4820PL093489 HV CO CO 98050470025
</TABLE>
<PAGE>
PAGE 10
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H642 TRAILER IN 93 KTY 1KKVE4827PL093490 HV CO CO 98050470022
11H643 TRAILER IN 93 KTY 1KKVE4829PL093491 HV CO CO 98050470028
11H644 TRAILER IN 93 KTY 1KKVE4820PL093492 HV CO CO 98050470030
11H645 TRAILER IN 93 KTY 1KKVE4822PL093493 HV CO CO 98050470032
11H646 TRAILER IN 93 KTY 1KKVE4824PL093494 HV CO CO 98050470034
11H647 TRAILER IN 93 KTY 1KKVE4826PL093495 HV CO CO 98050470036
11H648 TRAILER IN 93 KTY 1KKVE4828PL093496 HV CO CO 98050470039
11H649 TRAILER IN 93 KTY 1KKVE482XPL093497 HV CO CO 98050470041
11H650 TRAILER IN 93 KTY 1KKVE4821PL093498 HV CO CO 98050470044
11H651 TRAILER IN 93 KTY 1KKVE4823PL093499 HV CO CO 98050470049
11H652 TRAILER IN 93 KTY 1KKVE4826PL093500 HV CO CO 98050470050
11H653 TRAILER IN 93 KTY 1KKVE4828PL093501 HV CO CO 98050470051
11H654 TRAILER IN 93 KTY 1KKVE482XPL093502 HV CO CO 98050470054
11H655 TRAILER IN 93 KTY 1KKVE4821PL093503 HV CO CO 98050470056
11H656 TRAILER IN 93 KTY 1KKVE4823PL093504 HV CO CO 98050470058
11H657 TRAILER IN 93 KTY 1KKVE4825PL093505 HV CO CO 98050470060
11H658 TRAILER IN 93 KTY 1KKVE4827PL093506 HV CO CO 98050470061
11H659 TRAILER IN 93 KTY 1KKVE4829PL093507 HV CO CO 98050470063
11H660 TRAILER IN 93 KTY 1KKVE4820PL093508 HV CO CO 98050470066
11H661 TRAILER IN 93 KTY 1KKVE4822PL093509 HV CO CO 98050470068
11H662 TRAILER IN 93 KTY 1KKVE4829PL093510 HV CO CO 98050470069
11H663 TRAILER IN 93 KTY 1KKVE4820PL093511 HV CO CO 98050470071
11H664 TRAILER IN 93 KTY 1KKVE4822PL093512 HV CO CO 98050470073
11H665 TRAILER IN 93 KTY 1KKVE4824PL093513 HV CO CO 98050470075
11H666 TRAILER IN 93 KTY 1KKVR4825PL093959 HV CO CO 98050470077
11H667 TRAILER IN 93 KTY 1KKVE4825PL093469 HV CO CO 98050470080
11H669 TRAILER IN 93 KTY 1KKVE4823PL093471 HV CO CO 98050470084
11H670 TRAILER IN 93 KTY 1KKVE4825PL093472 HV CO CO 98050470087
11H671 TRAILER IN 93 KTY 1KKVE4827PL093473 HV CO CO 98050470089
11H672 TRAILER IN 93 STN 1DW1A5323PS825101 HV CO CO 98050470091
11H673 TRAILER IN 93 STN 1DW1A5325PS825102 HV CO CO 98050473961
11H674 TRAILER IN 93 STN 1DW1A5327PS825103 HV CO CO 98050473962
11H675 TRAILER IN 93 STN 1DW1A5329PS825104 HV CO CO 98050473964
11H676 TRAILER IN 93 STN 1DW1A5320PS825105 HV CO CO 98050470094
11H677 TRAILER IN 93 STN 1DW1A5322PS825106 HV CO CO 98050470097
11H678 TRAILER IN 93 STN 1DW1A5324PS825107 HV CO CO 98050470099
11H679 TRAILER IN 93 STN 1DW1A5326PS825108 HV CO CO 98050470101
11H680 TRAILER IN 93 STN 1DW1A5328PS825109 HV CO CO 98050470103
11H681 TRAILER IN 93 STN 1DW1A5324PS825110 HV DC 12 98050470105
11H682 TRAILER IN 93 STN 1DW1A5326PS825111 HV CO CO 98050470107
11H683 TRAILER IN 93 KTY 1KKVR4820PL094789 HV CO CO 98050470108
11H684 TRAILER IN 93 KTY 1KKVR4827PL094790 HV CO CO 98050470109
11H685 TRAILER IN 93 KTY 1KKVR4829PL094791 HV CO CO 98050470110
11H686 TRAILER IN 93 KTY 1KKVR4820PL094792 HV CO CO 98050470111
11H687 TRAILER IN 93 KTY 1KKVR4820PL095411 HV CO CO 98050470112
11H688 TRAILER IN 93 KTY 1KKVR4822PL095412 HV CO CO 98050470113
11H689 TRAILER IN 93 KTY 1KKVR4824PL095413 HV CO CO 98050470114
11H690 TRAILER IN 93 KTY 1KKVR4826PL095414 HV CO CO 98050470584
11H691 TRAILER IN 93 KTY 1KKVR4828PL095415 HV CO CO 98050470585
11H692 TRAILER IN 93 KTY 1KKVR482XPL095416 HV CO CO 98050470587
</TABLE>
<PAGE>
PAGE 11
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H693 TRAILER IN 93 KTY 1KKVR4821PL095417 HV CO CO 98050470589
11H694 TRAILER IN 93 KTY 1KKVR4823PL095418 HV CO CO 98050470593
11H695 TRAILER IN 94 KTY 1KKVR4824RL096273 HV CO CO 98050470595
11H696 TRAILER IN 94 KTY 1KKVR4826RL096274 HV CO CO 98050470597
11H697 TRAILER IN 94 KTY 1KKVR4828RL096275 HV CO CO 98050470600
11H698 TRAILER IN 94 KTY 1KKVR482XRL096276 HV CO CO 98050470601
11H699 TRAILER IN 94 KTY 1KKVR4821RL096277 HV CO CO 98050470604
11H700 TRAILER IN 94 KTY 1KKVR4823RL096278 HV CO CO 98050470609
11H701 TRAILER IN 94 KTY 1KKVR4825RL096279 HV CO CO 98050470611
11H702 TRAILER IN 94 KTY 1KKVR4821RL096280 HV CO CO 98050470613
11H703 TRAILER IN 93 KTY 1KKVE4820PL094769 HV CO CO 98050470615
11H704 TRAILER IN 93 KTY 1KKVE4827PL094770 HV CO CO 98050470618
11H705 TRAILER IN 93 KTY 1KKVE4829PL094771 HV CO CO 98050470620
11H706 TRAILER IN 93 KTY 1KKVE4820PL094772 HV CO CO 98050470622
11H707 TRAILER IN 93 KTY 1KKVE4822PL094773 HV CO CO 98050470628
11H708 TRAILER IN 93 KTY 1KKVE4824PL094774 HV CO CO 98050470630
11H709 TRAILER IN 93 KTY 1KKVE4826PL094775 HV CO CO 98050470632
11H710 TRAILER IN 93 KTY 1KKVE4828PL094776 HV CO CO 98050470634
11H711 TRAILER IN 93 KTY 1KKVE482XPL094777 HV CO CO 98050470636
11H712 TRAILER IN 93 KTY 1KKVE4821PL094778 HV CO CO 98050470638
11H713 TRAILER IN 93 KTY 1KKVE4823PL094779 HV CO CO 98050470641
11H714 TRAILER IN 93 KTY 1KKVE482XPL094780 HV CO CO 98050470644
11H715 TRAILER IN 93 KTY 1KKVE4821PL094781 HV CO CO 98050470646
11H716 TRAILER IN 93 KTY 1KKVE4823PL094782 HV CO CO 98050470649
11H717 TRAILER IN 93 KTY 1KKVE4825PL094783 HV CO CO 98050470650
11H718 TRAILER IN 93 KTY 1KKVE4827PL094784 HV CO CO 98050470653
11H719 TRAILER IN 93 KTY 1KKVE4829PL094785 HV CO CO 98050470655
11H720 TRAILER IN 93 KTY 1KKVE4820PL094786 HV CO CO 98050470657
11H721 TRAILER IN 93 KTY 1KKVE4822PL094787 HV CO CO 98050470659
11H722 TRAILER IN 93 KTY 1KKVE4824PL094788 HV CO CO 98050470661
11H723 TRAILER IN 93 KTY 1KKVE4822PL095325 HV CO CO 98050470662
11H724 TRAILER IN 93 KTY 1KKVE4824PL095326 HV CO CO 98050470665
11H725 TRAILER IN 93 KTY 1KKVE4826PL095327 HV CO CO 98050470666
11H726 TRAILER IN 93 KTY 1KKVE4828PL095328 HV CO CO 98050470670
11H727 TRAILER IN 93 KTY 1KKVE482XPL095329 HV CO CO 98050470672
11H728 TRAILER IN 93 KTY 1KKVE4826PL095330 HV CO CO 98050470674
11H729 TRAILER IN 93 KTY 1KKVE4828PL095331 HV CO CO 98050470676
11H730 TRAILER IN 93 KTY 1KKVE482XPL095332 HV CO CO 98050470678
11H731 TRAILER IN 93 KTY 1KKVE4821PL095333 HV CO CO 98050470680
11H732 TRAILER IN 93 KTY 1KKVE4823PL095334 HV CO CO 98050470682
11H733 TRAILER IN 93 KTY 1KKVE4825PL095335 HV CO CO 98050470684
11H734 TRAILER IN 93 KTY 1KKVE4827PL095336 HV CO CO 98050470686
11H735 TRAILER IN 93 KTY 1KKVE4829PL095337 HV CO CO 98050470688
11H736 TRAILER IN 93 KTY 1KKVE4820PL095338 HV CO CO 98050470689
11H737 TRAILER IN 93 KTY 1KKVE4822PL095339 HV CO CO 98050470690
11H738 TRAILER IN 93 KTY 1KKVE4829PL095340 HV CO CO 98050470691
11H739 TRAILER IN 93 KTY 1KKVE4820PL095341 HV CO CO 98050470692
11H740 TRAILER IN 93 KTY 1KKVE4822PL095342 HV CO CO 98050470088
11H741 TRAILER IN 93 KTY 1KKVE4824PL095343 HV CO CO 98050470090
11H742 TRAILER IN 93 KTY 1KKVE4826PL095344 HV CO CO 98050470092
</TABLE>
<PAGE>
PAGE 12
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H743 TRAILER IN 93 KTY 1KKVE4828PL095345 HV CO CO 98050470093
11H744 TRAILER IN 93 KTY 1KKVE482XPL095346 HV CO CO 98050470095
11H745 TRAILER IN 93 KTY 1KKVE4821PL095347 HV CO CO 98050470096
11H746 TRAILER IN 93 KTY 1KKVE4823PL095348 HV CO CO 98050470098
11H747 TRAILER IN 93 KTY 1KKVE4825PL095349 HV CO CO 98050470100
11H748 TRAILER IN 93 KTY 1KKVE4821PL095350 HV CO CO 98050470102
11H749 TRAILER IN 93 KTY 1KKVE4823PL095351 HV CO CO 98050470104
11H750 TRAILER IN 93 KTY 1KKVE4825PL095352 HV CO CO 98050470106
11H751 TRAILER IN 93 KTY 1KKVE4827PL095353 HV CO CO 98050470118
11H752 TRAILER IN 93 KTY 1KKVE4829PL095354 HV CO CO 98050470120
11H753 TRAILER IN 93 KTY 1KKVE4820PL095355 HV CO CO 98050470122
11H754 TRAILER IN 93 KTY 1KKVE4822PL095356 HV CO CO 98050470124
11H755 TRAILER IN 93 KTY 1KKVE4824PL095357 HV CO CO 98050470126
11H756 TRAILER IN 93 KTY 1KKVE4826PL095358 HV CO CO 98050470128
11H757 TRAILER IN 93 KTY 1KKVE4828PL095359 HV CO CO 98050470129
11H758 TRAILER IN 93 KTY 1KKVE4824PL095360 HV CO CO 98050470131
11H759 TRAILER IN 93 KTY 1KKVE4826PL095361 HV CO CO 98050470133
11H760 TRAILER IN 93 KTY 1KKVE4828PL095362 HV CO CO 98050470134
11H761 TRAILER IN 93 KTY 1KKVE482XPL095363 HV CO CO 98050470136
11H762 TRAILER IN 93 KTY 1KKVE4821PL095364 HV CO CO 98050470137
11H763 TRAILER IN 93 KTY 1KKVE4823PL095365 HV CO CO 98050470139
11H764 TRAILER IN 93 KTY 1KKVE4825PL095366 HV CO CO 98050470141
11H765 TRAILER IN 93 KTY 1KKVE4827PL095367 HV CO CO 98050470142
11H766 TRAILER IN 93 KTY 1KKVE4829PL095368 HV CO CO 98050470144
11H767 TRAILER IN 93 KTY 1KKVE4820PL095369 HV CO CO 98050470145
11H768 TRAILER IN 93 KTY 1KKVE4827PL095370 HV CO CO 98050470147
11H790 TRAILER IN 93 KTY 1KKVE4827PL094719 HV CO CO 98050470149
11H794 TRAILER IN 93 KTY 1KKVE4829PL094723 HV CO CO 98050470177
11H800 TRAILER IN 93 KTY 1KKVE482XPL094729 HV CO CO 98050470152
11H801 TRAILER IN 93 KTY 1KKVE4826PL094730 HV CO CO 98050470154
11H802 TRAILER IN 93 KTY 1KKVE4828PL094731 HV CO CO 98050470155
11H803 TRAILER IN 93 KTY 1KKVE482XPL094732 HV CO CO 98050470157
11H804 TRAILER IN 93 KTY 1KKVE4821PL094733 HV CO CO 98050470159
11H805 TRAILER IN 93 KTY 1KKVE4823PL094734 HV CO CO 98050470161
11H806 TRAILER IN 93 KTY 1KKVE4825PL094735 HV CO CO 98050470162
11H807 TRAILER IN 93 KTY 1KKVE4827PL094736 HV CO CO 98050470164
11H808 TRAILER IN 93 KTY 1KKVE4829PL094737 HV CO CO 98050470165
11H809 TRAILER IN 93 KTY 1KKVE4820PL094738 HV CO CO 98050470167
11H810 TRAILER IN 93 KTY 1KKVE4822PL094739 HV CO CO 98050470169
11H811 TRAILER IN 93 KTY 1KKVE4829PL094740 HV CO CO 98050470170
11H812 TRAILER IN 93 KTY 1KKVE4820PL094741 HV CO CO 98050470172
11H813 TRAILER IN 93 KTY 1KKVE4822PL094742 HV CO CO 98050470174
11H814 TRAILER IN 93 KTY 1KKVE4824PL094743 HV CO CO 98050470175
11H815 TRAILER IN 93 KTY 1KKVE4826PL094744 HV CO CO 98050470179
11H816 TRAILER IN 93 KTY 1KKVE4828PL094745 HV CO CO 98050470180
11H817 TRAILER IN 93 KTY 1KKVE482XPL094746 HV CO CO 98050470181
11H818 TRAILER IN 93 KTY 1KKVE4821PL094747 HV CO CO 98050470183
11H819 TRAILER IN 93 KTY 1KKVE4823PL094748 HV CL LA 98050470115
11H820 TRAILER IN 93 KTY 1KKVE4825PL094749 HV CO CO 98050470116
11H821 TRAILER IN 93 KTY 1KKVE4821PL094750 HV CO CO 98050470117
</TABLE>
<PAGE>
PAGE 13
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H822 TRAILER IN 93 KTY 1KKVE4823PL094751 HV CO CO 98050470119
11H823 TRAILER IN 93 KTY 1KKVE4825PL094752 HV CO CO 98050470121
11H824 TRAILER IN 93 KTY 1KKVE4827PL094753 HV CO CO 98050470123
11H825 TRAILER IN 93 KTY 1KKVE4829PL094754 HV CO CO 98050470125
11H826 TRAILER IN 93 KTY 1KKVE4820PL094755 HV CO CO 98050470127
11H827 TRAILER IN 93 KTY 1KKVE4822PL094756 HV CO CO 98050470130
11H828 TRAILER IN 93 KTY 1KKVE4824PL094757 HV CO CO 98050470132
11H829 TRAILER IN 93 KTY 1KKVE4826PL094758 HV CO CO 98050470135
11H830 TRAILER IN 93 KTY 1KKVE4828PL094759 HV CO CO 98050470138
11H831 TRAILER IN 93 KTY 1KKVE4824PL094760 HV CO CO 98050470140
11H832 TRAILER IN 93 KTY 1KKVE4826PL094761 HV CO CO 98050470143
11H833 TRAILER IN 93 KTY 1KKVE4828PL094762 HV CO CO 98050470146
11H834 TRAILER IN 93 KTY 1KKVE482XPL094763 HV CO CO 98050470148
11H835 TRAILER IN 93 KTY 1KKVE4821PL094764 HV CO CO 98050470150
11H836 TRAILER IN 93 KTY 1KKVE4823PL094765 HV CO CO 98050470151
11H837 TRAILER IN 93 KTY 1KKVE4825PL094766 HV CO CO 98050470153
11H838 TRAILER IN 93 KTY 1KKVE4827PL094767 HV CO CO 98050470156
11H839 TRAILER IN 93 KTY 1KKVE4829PL094768 HV CO CO 98050470158
11H840 TRAILER IN 93 KTY 1KKVE4829PL095371 HV CO CO 98050470160
11H841 TRAILER IN 93 KTY 1KKVE4820PL095372 HV CO CO 98050470163
11H842 TRAILER IN 93 KTY 1KKVE4822PL095373 HV CO CO 98050470166
11H843 TRAILER IN 93 KTY 1KKVE4824PL095374 HV CO CO 98050470168
11H844 TRAILER IN 93 KTY 1KKVE4826PL095375 HV CO CO 98050470171
11H845 TRAILER IN 93 KTY 1KKVE4828PL095376 HV CO CO 98050470173
11H846 TRAILER IN 93 KTY 1KKVE482XPL095377 HV CO CO 98050470176
11H847 TRAILER IN 93 KTY 1KKVE4821PL095378 HV CO CO 98050470182
11H848 TRAILER IN 93 KTY 1KKVE4823PL095379 HV CO CO 98050470184
11H849 TRAILER IN 93 KTY 1KKVE482XPL095380 HV CO CO 98050470185
11H850 TRAILER IN 93 KTY 1KKVE4821PL095381 HV CO CO 98050470186
11H851 TRAILER IN 93 KTY 1KKVE4823PL095382 HV CO CO 98050470187
11H852 TRAILER IN 93 KTY 1KKVE4825PL095383 HV CO CO 98050470188
11H853 TRAILER IN 93 KTY 1KKVE4827PL095384 HV CO CO 98050470191
11H854 TRAILER IN 93 KTY 1KKVE4829PL095385 HV CO CO 98050470193
11H855 TRAILER IN 93 KTY 1KKVE4820PL095386 HV CO CO 98050470198
11H856 TRAILER IN 93 KTY 1KKVE4822PL095387 HV CO CO 98050470200
11H857 TRAILER IN 93 KTY 1KKVE4824PL095388 HV CO CO 98050470202
11H858 TRAILER IN 93 KTY 1KKVE4826PL095389 HV CO CO 98050470207
11H859 TRAILER IN 93 KTY 1KKVE4822PL095390 HV CO CO 98050470209
11H860 TRAILER IN 93 KTY 1KKVE4824PL095391 HV CO CO 98050470212
11H861 TRAILER IN 93 KTY 1KKVE4826PL095392 HV CO CO 98050470214
11H862 TRAILER IN 93 KTY 1KKVE4828PL095393 HV CO CO 98050470216
11H863 TRAILER IN 93 KTY 1KKVE482XPL095394 HV CO CO 98050470219
11H864 TRAILER IN 93 KTY 1KKVE4821PL095395 HV CO CO 98050470221
11H865 TRAILER IN 93 KTY 1KKVE4823PL095396 HV CO CO 98050470222
11H866 TRAILER IN 93 KTY 1KKVE4825PL095397 HV CO CO 98050470223
11H867 TRAILER IN 93 KTY 1KKVE4827PL095398 HV CO CO 98050470224
11H868 TRAILER IN 93 KTY 1KKVE4829PL095399 HV CO CO 98050470225
11H869 TRAILER IN 93 KTY 1KKVE4821PL095400 HV CO CO 98050470189
11H870 TRAILER IN 93 KTY 1KKVE4823PL095401 HV CO CO 98050470190
11H872 TRAILER IN 93 KTY 1KKVE4827PL095403 HV CO CO 98050470192
</TABLE>
<PAGE>
PAGE 14
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H873 TRAILER IN 93 KTY 1KKVE4829PL095404 HV CO CO 98050470194
11H874 TRAILER IN 93 KTY 1KKVE4820PL095405 HV CO CO 98050470195
11H875 TRAILER IN 93 KTY 1KKVE4822PL095406 HV CO CO 98050470196
11H876 TRAILER IN 93 KTY 1KKVE4822PL095407 HV CO CO 98050470197
11H877 TRAILER IN 93 KTY 1KKVE4826PL095408 HV CO CO 98050470199
11H878 TRAILER IN 93 KTY 1KKVE4828PL095409 HV CO CO 98050470201
11H879 TRAILER IN 93 KTY 1KKVE4824PL095410 HV CO CO 98050470203
11H880 TRAILER IN 94 KTY 1KKVE4820RL096220 HV CO CO 98050470204
11H881 TRAILER IN 94 KTY 1KKVE4822RL096221 HV CO CO 98050470205
11H882 TRAILER IN 94 KTY 1KKVE4824RL096222 HV CO CO 98050470206
11H883 TRAILER IN 94 KTY 1KKVE4826RL096223 HV CO CO 98050470208
11H884 TRAILER IN 94 KTY 1KKVE4828RL096224 HV CO CO 98050470210
11H885 TRAILER IN 94 KTY 1KKVE482XRL096225 HV CO CO 98050470211
11H886 TRAILER IN 94 KTY 1KKVE4821RL096226 HV CO CO 98050470213
11H887 TRAILER IN 94 KTY 1KKVE4823RL096227 HV CO CO 98050470215
11H888 TRAILER IN 94 KTY 1KKVE4825RL096228 HV CO CO 98050470217
11H889 TRAILER IN 94 KTY 1KKVE4827RL096229 HV CO CO 98050470218
11H890 TRAILER IN 94 KTY 1KKVE4823RL096230 HV CO CO 98050470220
11H891 TRAILER IN 94 KTY 1KKVE4825RL096231 HV CO CO 98050470231
11H892 TRAILER IN 94 KTY 1KKVE4827RL096232 HV CO CO 98050470232
11H893 TRAILER IN 94 KTY 1KKVE4829RL096233 HV CO CO 98050470233
11H895 TRAILER IN 94 KTY 1KKVE4820RL096234 HV CO CO 98050470235
11H896 TRAILER IN 94 KTY 1KKVE4822RL096235 HV CO CO 98050470236
11H897 TRAILER IN 94 KTY 1KKVE4824RL096236 HV CO CO 98050470237
11H898 TRAILER IN 94 KTY 1KKVE4826RL096237 HV CO CO 98050470239
11H899 TRAILER IN 94 KTY 1KKVE4828RL096238 HV CO CO 98050470240
11H900 TRAILER IN 94 KTY 1KKVE482XRL096239 HV CO CO 98050470242
11H901 TRAILER IN 94 KTY 1KKVE4826RL096240 HV CO CO 98050470244
11H902 TRAILER IN 94 KTY 1KKVE4828RL096241 HV CO CO 98050470246
11H903 TRAILER IN 94 KTY 1KKVE482XRL096242 HV CO CO 98050470248
11H904 TRAILER IN 94 KTY 1KKVE4821RL096243 HV CO CO 98050470250
11H905 TRAILER IN 94 KTY 1KKVE4823RL096244 HV CO CO 98050470252
11H906 TRAILER IN 94 KTY 1KKVE4825RL096245 HV CO CO 98050470253
11H907 TRAILER IN 94 KTY 1KKVE4827RL096246 HV CO CO 98050470254
11H908 TRAILER IN 94 KTY 1KKVE4829RL096247 HV CO CO 98050470256
11H909 TRAILER IN 94 KTY 1KKVE4820RL096248 HV CO CO 98050470258
11H910 TRAILER IN 94 KTY 1KKVE4822RL096249 HV CO CO 98050470259
11H911 TRAILER IN 94 KTY 1KKVE4829RL096250 HV CO CO 98050470261
11H912 TRAILER IN 94 KTY 1KKVE4820RL096251 HV CO CO 98050470263
11H913 TRAILER IN 94 KTY 1KKVE4822RL096252 HV CO CO 98050470264
11H914 TRAILER IN 94 KTY 1KKVE4824RL096253 HV CO CO 98050470265
11H915 TRAILER IN 94 KTY 1KKVE4826RL096254 HV CO CO 98050470267
11H916 TRAILER IN 94 KTY 1KKVE4828RL096255 HV CO CO 98050470269
11H917 TRAILER IN 94 KTY 1KKVE482XRL096256 HV CO CO 98050470270
11H918 TRAILER IN 94 KTY 1KKVE4821RL096257 HV CO CO 98050470272
11H919 TRAILER IN 94 KTY 1KKVE4823RL096258 HV CO CO 98050470273
11H920 TRAILER IN 94 KTY 1KKVE4825RL096259 HV CO CO 98050470275
11H921 TRAILER IN 94 KTY 1KKVE4821RL096260 HV CO CO 98050470226
11H922 TRAILER IN 94 KTY 1KKVE4823RL096261 HV CO CO 98050470227
11H923 TRAILER IN 94 KTY 1KKVE4825RL096262 HV CO CO 98050470228
</TABLE>
<PAGE>
Page 15
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11H925 TRAILER IN 94 KTY 1KKVE4829RL096264 HV CO CO 98050470234
11H926 TRAILER IN 94 KTY 1KKVE4820RL096265 HV CO CO 98050470238
11H927 TRAILER IN 94 KTY 1KKVE4822RL096266 HV CO CO 98050470241
11H928 TRAILER IN 94 KTY 1KKVE4824RL096267 HV CO CO 98050470243
11H929 TRAILER IN 94 KTY 1KKVE4826RL096268 HV CO CO 98050470245
11H930 TRAILER IN 94 KTY 1KKVE4828RL096269 HV CO CO 98050470247
11J764 TRAILER IN 86 KTY 1KKVE4826GL076678 RS CO CO 98050470249
11J765 TRAILER IN 86 KTY 1KKVE4828GL076679 RS CL LA 98050470251
11J766 TRAILER IN 86 KTY 1KKVE4824GL076680 RS CL LA 98050470255
11J767 TRAILER IN 86 KTY 1KKVE4826GL076681 RS CO CO 98050470257
11J768 TRAILER IN 86 KTY 1KKVE4828GL076682 RS CO CO 98050470260
11J769 TRAILER IN 86 KTY 1KKVE482XGL076683 RS CL LA 98050470262
11J770 TRAILER IN 86 KTY 1KKVE4821GL076684 RS CO CO 98050470266
11J771 TRAILER IN 86 KTY 1KKVE4823GL076685 RS CO CO 98050470268
11J772 TRAILER IN 86 KTY 1KKVE4825GL076686 RS CL LA 98050470271
11J773 TRAILER IN 86 KTY 1KKVE4827GLO76687 RS CO CO 98050470274
11J775 TRAILER IN 86 KTY 1KKVE4820GL076689 RS CO CO 98050470276
11J776 TRAILER IN 86 KTY 1KKVE4827GL076690 RS CO CO 98050470277
11J777 TRAILER IN 86 KTY 1KKVE4829GL076691 RS CL LA 98050470278
11J778 TRAILER IN 86 KTY 1KKVE4820GL076692 RS CL LA 98050470279
11J779 TRAILER IN 86 KTY 1KKVE4822GL076693 RS CL LA 98050470280
11J780 TRAILER IN 86 KTY 1KKVE4824GL076694 RS CO CO 98050470281
11J781 TRAILER IN 86 KTY 1KKVE4826GL076695 RS CL LA 98050470282
11J782 TRAILER IN 86 KTY 1KKVE4828GL076696 RS CL LA 98050470283
11J783 TRAILER IN 86 KTY 1KKVE482XGL076697 RS CO CO 98050470284
11J784 TRAILER IN 86 KTY 1KKVE4821GLO76698 RS CL LA 98050470285
11J785 TRAILER IN 86 KTY 1KKVE4823GL076699 RS CO CO 98050470286
11J786 TRAILER IN 86 KTY 1KKVE4826GL076700 RS CO CO 98050470287
11J787 TRAILER IN 86 KTY 1KKVE4828GL076701 RS CL LA 98050470288
11J788 TRAILER IN 86 KTY 1KKVE482XGL076702 RS CO CO 98050470289
11J789 TRAILER IN 86 KTY 1KKVE4821GL076703 RS CO CO 98050470290
11J790 TRAILER IN 86 KTY 1KKVE4823GL076704 RS CO CO 98050470291
11J791 TRAILER IN 86 KTY 1KKVE4825GL076705 RS CO CO 98050470292
11J792 TRAILER IN 86 KTY 1KKVE4827GL076706 RS CL LA 98050470293
11J793 TRAILER IN 86 KTY 1KKVE4829GL076707 RS CO CO 98050470294
11J795 TRAILER IN 86 KTY 1KKVE4822GL076709 RS CO CO 98050470295
11J796 TRAILER IN 86 KTY 1KKVE4829GL076710 RS CO CO 98050470296
11J797 TRAILER IN 86 KTY 1KKVE4820GL076711 RS CO CO 98050470297
11J798 TRAILER IN 86 KTY 1KKVE4822GL076712 RS CL LA 98050470298
11J799 TRAILER IN 86 KTY 1KKVE4824GL076713 RS CO CO 98050470299
11J800 TRAILER IN 86 KTY 1KKVE4826GL076714 RS CO CO 98050470301
11J802 TRAILER IN 86 KTY 1KKVE482XGL076716 RS CO CO 98050470304
11J803 TRAILER IN 86 KTY 1KKVE4821GL076717 RS CO CO 98050470305
11J805 TRAILER IN 86 KTY 1KKVE4825GL076719 RS CO CO 98050470307
11J806 TRAILER IN 86 KTY 1KKVE4821GL076720 RS CO CO 98050470308
11J807 TRAILER IN 86 KTY 1KKVE4823GL076721 RS CL LA 98050470309
11J808 TRAILER IN 86 KTY 1KKVE4825GL076722 RS CL LA 98050470696
11J809 TRAILER IN 86 KTY 1KKVE4827GLO76723 RS CO CO 98050470698
11J810 TRAILER IN 86 KTY 1KKVE4829GL076724 RS CO CO 98050470700
11J811 TRAILER IN 86 KTY 1KKVE4820GL076725 RS CL LA 98050470703
</TABLE>
<PAGE>
PAGE 16
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11J812 TRAILER IN 86 KTY 1KKVE4822GL076726 RS CL LA 98050470705
11J813 TRAILER IN 86 KTY 1KKVE4824GL076727 RS CL LA 98050470707
11J814 TRAILER IN 86 KTY 1KKVE4826GL076728 RS CO CO 98050470710
11J815 TRAILER IN 86 KTY 1KKVE4828GL076729 RS CL LA 98050470712
11J816 TRAILER IN 86 KTY 1KKVE4824GL076730 RS CO CO 98050470714
11J817 TRAILER IN 86 KTY 1KKVE4826GL076731 RS CO CO 98050470716
11J818 TRAILER IN 86 KTY 1KKVE4828GL076732 RS CO CO 98050470718
11J819 TRAILER IN 86 KTY 1KKVE482XGL076733 RS CL LA 98050470721
11J821 TRAILER IN 86 KTY 1KKVE4823GL076735 RS CL LA 98050470723
11J822 TRAILER IN 86 KTY 1KKVE4825GL076736 RS CO CO 98050470726
11J823 TRAILER IN 86 KTY 1KKVE4827GL076737 RS CL LA 98050470728
11J824 TRAILER IN 86 KTY 1KKVE4829GL076738 RS CL LA 98050470730
11J825 TRAILER IN 86 KTY 1KKVE4820GL076739 RS CO CO 98050470732
11J827 TRAILER IN 86 KTY 1KKVE4829GL076741 RS CL LA 98050470735
11J828 TRAILER IN 86 KTY 1KKVE4820GL076742 RS CO CO 98050470737
11J829 TRAILER IN 86 KTY 1KKVE4822GL076743 RS CO CO 98050470739
11J830 TRAILER IN 86 KTY 1KKVE4824GL076744 RS CL LA 98050470742
11J831 TRAILER IN 86 KTY 1KKVE4826GL076745 RS CO CO 98050470744
11J832 TRAILER IN 86 KTY 1KKVE4828GL076746 RS CO CO 98050470747
11J833 TRAILER IN 86 KTY 1KKVE482XGL076747 RS CO CO 98050470750
11J834 TRAILER IN 86 KTY 1KKVE4821GL076748 RS CO CO 98050470751
11J835 TRAILER IN 86 KTY 1KKVE4823GL076749 RS CO CO 98050470752
11J836 TRAILER IN 86 KTY 1KKVE482XGL076750 RS CO CO 98050470753
11J837 TRAILER IN 86 KTY 1KKVE4821GL076751 RS CO CO 98050470754
11J838 TRAILER IN 86 KTY 1KKVE4823GL076752 RS CO CO 98050470756
11J839 TRAILER IN 86 KTY 1KKVE4825GL076753 RS CL LA 98050470757
11J840 TRAILER IN 86 KTY 1KKVE4827GL076754 HV CO CO 98050470759
11J841 TRAILER IN 86 KTY 1KKVE4829GL076755 HV CO CO 98050470761
11J842 TRAILER IN 86 KTY 1KKVE4820GL076756 HV CO CO 98050470763
11J843 TRAILER IN 86 KTY 1KKVE4822GL076757 RS CO CO 98050470765
11J844 TRAILER IN 86 KTY 1KKVE4824GL076758 HV CO CO 98050470767
11J845 TRAILER IN 86 KTY 1KKVE4826GL076759 RS CL LA 98050470769
11J847 TRAILER IN 86 KTY 1KKVE4824GL076761 RS CL LA 98050470771
11J848 TRAILER IN 86 KTY 1KKVE4826GL076762 RS CO CO 98050470773
11J850 TRAILER IN 86 KTY 1KKVE482XGL076764 HV CO CO 98050470775
11J851 TRAILER IN 86 KTY 1KKVE4821GL076975 RS CO CO 98050470776
11J852 TRAILER IN 86 KTY 1KKVE4823GL076976 RS CL LA 98050470777
11J853 TRAILER IN 86 KTY 1KKVE4825GL076977 RS CL LA 98050470778
11J879 TRAILER IN 86 KTY 1KKVE4821GL076765 HV CO CO 98050470779
11J880 TRAILER IN 86 KTY 1KKVE4823GL076766 HV CO CO 98050470780
11J881 TRAILER IN 86 KTY 1KKVE4825GL076767 HV CO CO 98050470799
11J882 TRAILER IN 86 KTY 1KKVE4827GL076768 RS CO CO 98050470802
11J883 TRAILER IN 86 KTY 1KKVE4829GL076769 HV CO CO 98050470804
11J884 TRAILER IN 86 KTY 1KKVE4825GL076770 HV CO CO 98050470805
11J885 TRAILER IN 86 KTY 1KKVE4827GL076771 HV CO CO 98050470806
11J886 TRAILER IN 86 KTY 1KKVE4829GL076772 HV CO CO 98050470809
11J887 TRAILER IN 86 KTY 1KKVE4820GL076773 HV CO CO 98050470537
11J888 TRAILER IN 86 KTY 1KKVE4822GL076774 HV CL LA 98050470538
11J889 TRAILER IN 86 KTY 1KKVE4824GL076775 RS CO CO 98050470540
11J890 TRAILER IN 86 KTY 1KKVE4826GL076776 HV CO CO 98050470542
</TABLE>
<PAGE>
PAGE 17
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11J891 TRAILER IN 86 KTY 1KKVE4828GL076777 HV CO CO 98050470544
11J892 TRAILER IN 86 KTY 1KKVE482XGL076778 HV CO CO 98050470546
11J893 TRAILER IN 86 KTY 1KKVE4821GL076779 HV CO CO 98050470548
11J894 TRAILER IN 86 KTY 1KKVE4828GL076780 HV CO CO 98050470550
11J895 TRAILER IN 86 KTY 1KKVE482XGL076781 HV CO CO 98050470552
11J896 TRAILER IN 86 KTY 1KKVE4821GL076782 HV CO CO 98050470554
11J897 TRAILER IN 86 KTY 1KKVE4823GL076783 HV CO CO 98050470556
11J898 TRAILER IN 86 KTY 1KKVE4825GL076784 HV CL LA 98050470558
11J928 TRAILER IN 87 KTY 1KKVE4729HL078251 HV DC 02 98050470560
11J929 TRAILER IN 87 KTY 1KKVE4720HL078252 HV CL LA 98050470564
11J932 TRAILER IN 87 KTY 1KKVE4726HL078255 HV CO CO 98050470565
11J934 TRAILER IN 87 KTY 1KKVE472XHL078257 HV CO CO 98050470568
11J935 TRAILER IN 87 KTY 1KKVE4721HL078258 HV CO CO 98050470570
11J937 TRAILER IN 87 KTY 1KKVE472XHL078260 HV CO CO 98050470572
11J938 TRAILER IN 87 KTY 1KKVE4721HL078261 HV CO CO 98050470575
11J940 TRAILER IN 87 KTY 1KKVE4725HL078263 HV CO CO 98050470577
11J941 TRAILER IN 87 KTY 1KKVE4727HL078264 HV CL LA 98050470579
11J942 TRAILER IN 87 KTY 1KKVE4729HL078265 HV CL LA 98050470580
11J943 TRAILER IN 87 KTY 1KKVE4720HL078266 HV CO CO 98050470582
11J944 TRAILER IN 87 KTY 1KKVE4722HL078267 HV DC 02 98050470583
11J945 TRAILER IN 87 KTY 1KKVE4724HL078268 HV CO CO 98050470586
11J946 TRAILER IN 87 KTY 1KKVE4726HL078269 RS CO CO 98050470588
11J947 TRAILER IN 87 KTY 1KKVE4722HL078270 HV CO CO 98050470590
11J948 TRAILER IN 87 KTY 1KKVE4724HL078271 HV CO CO 98050470591
11J949 TRAILER IN 87 KTY 1KKVE4726HL078272 HV CO CO 98050470592
11J950 TRAILER IN 87 KTY 1KKVE4728HL078273 HV CO CO 98050470594
11J952 TRAILER IN 87 KTY 1KKVE4721HL078275 HV CL LA 98050470596
11J954 TRAILER IN 87 KTY 1KKVE4725HL078277 HV CO CO 98050470598
11J956 TRAILER IN 87 KTY 1KKVE4729HL078279 RS CO CO 98050470599
11J958 TRAILER IN 87 KTY 1KKVE4727HL078281 HV CO CO 98050470602
11J959 TRAILER IN 87 KTY 1KKVE4729HL078282 HV CO CO 98050470603
11J960 TRAILER IN 87 KTY 1KKVE4720HL078283 RS CL LA 98050470606
11J961 TRAILER IN 87 KTY 1KKVE4722HL078284 HV CO CO 98050470607
11J962 TRAILER IN 87 KTY 1KKVE4724HL078285 HV CO CO 98050470608
11J964 TRAILER IN 87 KTY 1KKVE4728HL078287 HV CL LA 98050470612
11J966 TRAILER IN 87 KTY 1KKVE4721HL078289 HV CO CO 98050470614
11J968 TRAILER IN 87 KTY 1KKVE472XHL078291 HV CL LA 98050470616
11J969 TRAILER IN 87 KTY 1KKVE4721HL078292 HV CO CO 98050470617
11J970 TRAILER IN 87 KTY 1KKVE4723HL078293 RS CL LA 98050470619
11J971 TRAILER IN 87 KTY 1KKVE4725HL078294 HV CO CO 98050470621
11J972 TRAILER IN 87 KTY 1KKVE4727HL078295 HV DC 08 98050470623
11J973 TRAILER IN 87 KTY 1KKVE4729HL078296 HV CO CO 98050470624
11J974 TRAILER IN 87 KTY 1KKVE4720HL078297 HV CO CO 98050470626
11J975 TRAILER IN 87 KTY 1KKVE4722HL078298 HV CO CO 98050470627
11J976 TRAILER IN 87 KTY 1KKVE4724HL078299 RS CL LA 98050470629
11J977 TRAILER IN 87 KTY 1KKVE4727HL078300 RS CO CO 98050470631
11J978 TRAILER IN 87 KTY 1KKVE4729HL078301 HV CL LA 98050470633
11J980 TRAILER IN 87 KTY 1KKVE4722HL078303 HV CO CO 98050470635
11J987 TRAILER IN 87 KTY 1KKVE472XHL078310 HV CO CO 98050470637
11J988 TRAILER IN 87 KTY 1KKVE4721HL078311 RS CL LA 98050470639
</TABLE>
<PAGE>
PAGE 18
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11J989 TRAILER IN 87 KTY 1KKVE4723HL078312 HV CO CO 98050470640
11J990 TRAILER IN 87 KTY 1KKVE4725HL078313 HV CO CO 98050470642
11J991 TRAILER IN 87 KTY 1KKVE4727HL078314 HV CL LA 98050470643
11J992 TRAILER IN 87 KTY 1KKVE4729HL078315 HV CO CO 98050470645
11J994 TRAILER IN 87 KTY 1KKVE4722HL078317 HV CO CO 98050470647
11J995 TRAILER IN 87 KTY 1KKVE4724HL078318 HV CL LA 98050470648
11J997 TRAILER IN 87 KTY 1KKVE4722HL078320 HV CO CO 98050470651
11J998 TRAILER IN 87 KTY 1KKVE4724HL078321 HV CO CO 98050470652
11K000 TRAILER IN 87 KTY 1KKVE4728HL078323 HV CO CO 98050470658
11K003 TRAILER IN 87 KTY 1KKVE4723HL078326 HV CO CO 98050470660
11K006 TRAILER IN 87 KTY 1KKVE4826HL078948 RS CO CO 98050470663
11K007 TRAILER IN 87 KTY 1KKVE4828HL078949 RS CO CO 98050470664
11K008 TRAILER IN 87 KTY 1KKVE4824HL078950 RS CO CO 98050470667
11K009 TRAILER IN 87 KTY 1KKVE4826HL078951 RS CO CO 98050470668
11K010 TRAILER IN 87 KTY 1KKVE4828HL078952 RS CO CO 98050470669
11K011 TRAILER IN 87 KTY 1KKVE482XHL078953 HV CL LA 98050470671
11K012 TRAILER IN 87 KTY 1KKVE4821HL078954 RS CL LA 98050470673
11K013 TRAILER IN 87 KTY 1KKVE4823HL078955 RS CO CO 98050470675
11K014 TRAILER IN 87 KTY 1KKVE4825HL078956 RS CO CO 98050470677
11K015 TRAILER IN 87 KTY 1KKVE4827HL078957 RS CO CO 98050470679
11K016 TRAILER IN 87 KTY 1KKVE4829HL078958 RS CO CO 98050470681
11K017 TRAILER IN 87 KTY 1KKVE4820HL078959 HV CO CO 98050470683
11K018 TRAILER IN 87 KTY 1KKVE4827HL078960 RS CO CO 98050470685
11K019 TRAILER IN 87 KTY 1KKVE4829HL078961 HV CO CO 98050470687
11K020 TRAILER IN 87 KTY 1KKVE4820HL078962 RS CO CO 98050470693
11K021 TRAILER IN 87 KTY 1KKVE4822HL078963 RS CO CO 98050470694
11K022 TRAILER IN 87 KTY 1KKVE4824HL078964 HV CO CO 98050470695
11K023 TRAILER IN 87 KTY 1KKVE4826HL078965 RS CO CO 98050470697
11K024 TRAILER IN 87 KTY 1KKVE4828HL078966 HV CO CO 98050470699
11K025 TRAILER IN 87 KTY 1KKVE482XHL078967 RS CL LA 98050470701
11K026 TRAILER IN 87 KTY 1KKVE4821HL078968 RS CO CO 98050470702
11K027 TRAILER IN 87 KTY 1KKVE4823HL078969 HV CO CO 98050470704
11K029 TRAILER IN 87 KTY 1KKVE4821HL078971 RS CL LA 98050470706
11K030 TRAILER IN 87 KTY 1KKVE4823HL078972 RS CO CO 98050470708
11K031 TRAILER IN 87 KTY 1KKVE4825HL078973 RS CO CO 98050470709
11K032 TRAILER IN 87 KTY 1KKVE4827HL078974 HV CO CO 98050470711
11K033 TRAILER IN 87 KTY 1KKVE4829HL078975 RS CO CO 98050470713
11K034 TRAILER IN 87 KTY 1KKVE4820HL078976 HV CO CO 98050470715
11K035 TRAILER IN 87 KTY 1KKVE4822HL078977 RS CO CO 98050470717
11K036 TRAILER IN 87 KTY 1KKVE4824HL078978 RS CO CO 98050470719
11K037 TRAILER IN 87 KTY 1KKVE4826HL078979 RS CO CO 98050470720
11K038 TRAILER IN 87 KTY 1KKVE4822HL078980 RS CO CO 98050470722
11K039 TRAILER IN 87 KTY 1KKVE4824HL078981 HV CO CO 98050470724
11K040 TRAILER IN 87 KTY 1KKVE4826HL078982 RS CO CO 98050470725
11K041 TRAILER IN 87 KTY 1KKVE4828HL078983 RS CO CO 98050470727
11K042 TRAILER IN 87 KTY 1KKVE482XHL078984 HV CO CO 98050470729
11K044 TRAILER IN 87 KTY 1KKVE4823HL078986 RS CO CO 98050470731
11K045 TRAILER IN 87 KTY 1KKVE4825HL078987 RS CO CO 98050470733
11K046 TRAILER IN 87 KTY 1KKVE4827HL078988 RS CO CO 98050470734
11K047 TRAILER IN 87 KTY 1KKVE4829HL078989 HV CO CO 98050470736
</TABLE>
<PAGE>
PAGE 19
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11K048 TRAILER IN 87 KTY 1KKVE4825HL078990 RS CO CO 98050470738
11K049 TRAILER IN 87 KTY 1KKVE4827HL078991 RS CO CO 98050470740
11K050 TRAILER IN 87 KTY 1KKVE4829HL078992 HV CO CO 98050470741
11K051 TRAILER IN 87 KTY 1KKVE4820HL078993 RS CO CO 98050470743
11K052 TRAILER IN 87 KTY 1KKVE4822HL078994 RS CO CO 98050470745
11K053 TRAILER IN 87 KTY 1KKVE4824HL078995 RS CO CO 98050470746
11K054 TRAILER IN 87 KTY 1KKVE4826HL078996 RS CO CO 98050470748
11K056 TRAILER IN 87 KTY 1KKVE482XHL078998 RS CO CO 98050470749
11K057 TRAILER IN 87 KTY 1KKVE4821HL078999 RS CO CO 98050470755
11K060 TRAILER IN 87 KTY 1KKVE4826HL079002 RS CO CO 98050470760
11K061 TRAILER IN 87 KTY 1KKVE4828HL079003 HV CO CO 98050470762
11K062 TRAILER IN 87 KTY 1KKVE482XHL079004 HV CL LA 98050470764
11K063 TRAILER IN 87 KTY 1KKVE4821HL079005 RS CO CO 98050470766
11K064 TRAILER IN 87 KTY 1KKVE4823HL079006 HV CO CO 98050470768
11K065 TRAILER IN 87 KTY 1KKVE4825HL079007 RS CO CO 98050470770
11K066 TRAILER IN 87 KTY 1KKVE4827HL079008 HV CO CO 98050470772
11K068 TRAILER IN 87 KTY 1KKVE4825HL079010 RS CL LA 98050470774
11K069 TRAILER IN 87 KTY 1KKVE4827HL079011 RS CO CO 98050470781
11K070 TRAILER IN 87 KTY 1KKVE4829HL079012 RS CO CO 98050470782
11K071 TRAILER IN 87 KTY 1KKVE4820HL079013 RS CO CO 98050470783
11K072 TRAILER IN 87 KTY 1KKVE4822HL079014 RS CO CO 98050470784
11K074 TRAILER IN 87 KTY 1KKVE4826HL079016 RS CO CO 98050470785
11K075 TRAILER IN 87 KTY 1KKVE4828HL079017 RS CO CO 98050470786
11K076 TRAILER IN 87 KTY 1KKVE482XHL079018 RS CL LA 98050470787
11K077 TRAILER IN 87 KTY 1KKVE4821HL079019 HV CO CO 98050470788
11K078 TRAILER IN 87 KTY 1KKVE4828HL079020 RS CO CO 98050470789
11K079 TRAILER IN 87 KTY 1KKVE482XHL079021 RS CO CO 98050470790
11K080 TRAILER IN 87 KTY 1KKVE4821HL079022 RS CO CO 98050470791
11K081 TRAILER IN 87 KTY 1KKVE4823HL079023 RS CO CO 98050470792
11K082 TRAILER IN 87 KTY 1KKVE4825HL079024 RS CO CO 98050470793
11K084 TRAILER IN 87 KTY 1KKVE4829HL079026 RS CO CO 98050470794
11K085 TRAILER IN 87 KTY 1KKVE4820HL079027 HV CO CO 98050470795
11K086 TRAILER IN 87 KTY 1KKVE4822HL079028 RS CO CO 98050470796
11K087 TRAILER IN 87 KTY 1KKVE4824HL079029 RS CO CO 98050470797
11K090 TRAILER IN 87 KTY 1KKVE4824HL079032 RS CO CO 98050470798
11K091 TRAILER IN 87 KTY 1KKVE4826HL079033 RS CL LA 98050470800
11K092 TRAILER IN 87 KTY 1KKVE4828HL079034 RS CO CO 98050470801
11K093 TRAILER IN 87 KTY 1KKVE482XHL079035 RS CO CO 98050470803
11K094 TRAILER IN 87 KTY 1KKVE4821HL079036 HV CO CO 98050470807
11K095 TRAILER IN 87 KTY 1KKVE4823HL079037 HV CO CO 98050470808
11K096 TRAILER IN 87 KTY 1KKVE4825HL079038 RS CO CO 98050470810
11K097 TRAILER IN 87 KTY 1KKVE4827HL079039 HV CO CO 98050470811
11K098 TRAILER IN 87 KTY 1KKVE4823HL079040 RS CO CO 98050470813
11K099 TRAILER IN 87 KTY 1KKVE4825HL079041 RS CO CO 98050470814
11K100 TRAILER IN 87 KTY 1KKVE4827HL079042 RS CO CO 98050470816
11K101 TRAILER IN 87 KTY 1KKVE4829HL079043 RS CO CO 98050470820
11K102 TRAILER IN 87 KTY 1KKVE4820HL079044 RS CO CO 98050470822
11K103 TRAILER IN 87 KTY 1KKVE4822HL079045 RS CO CO 98050470823
11K104 TRAILER IN 87 KTY 1KKVE4824HL079046 RS CL LA 98050470824
11K111 TRAILER IN 87 KTY 1KKVE4828HL079048 RS CO CO 98050470826
</TABLE>
<PAGE>
PAGE 20
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11K112 TRAILER IN 87 KTY 1KKVE482XHL079049 HV CO CO 98050473983
11K113 TRAILER IN 87 KTY 1KKVE4826HL079050 RS CL LA 98050470827
11K114 TRAILER IN 87 KTY 1KKVE4828HL079051 RS CO CO 98050470829
11K115 TRAILER IN 87 KTY 1KKVE482XHL079052 RS CO CO 98050470831
11K116 TRAILER IN 87 KTY 1KKVE4821HL079053 RS CO CO 98050470832
11K117 TRAILER IN 87 KTY 1KKVE4823HL079054 HV CO CO 98050470833
11K122 TRAILER IN 91 KTY 1KKVE4821ML090273 HV CO CO 98050470834
11K184 TRAILER IN 91 KTY 1KKVE4823ML090274 HV CO CO 98050470835
11K197 TRAILER IN 91 KTY 1KKVE4825ML090275 HV CO CO 98050470836
11K332 TRAILER IN 91 KTY 1KKVE4827ML090276 HV CO CO 98050470837
11K337 TRAILER IN 87 KTY 1KKVE4827HL080160 RS CO CO 98184473048
11K340 TRAILER IN 91 KTY 1KKVE4829ML090277 HV CO CO 98050470838
11K341 TRAILER IN 91 KTY 1KKVE4820ML090278 HV CO CO 98050470839
11K342 TRAILER IN 91 KTY 1KKVE4822ML090279 HV CO CO 98050470840
11K343 TRAILER IN 91 KTY 1KKVE4829ML090280 HV CO CO 98050470841
11K344 TRAILER IN 91 KTY 1KKVE4820ML090281 HV CO CO 98050470842
11K345 TRAILER IN 91 KTY 1KKVE4822ML090282 HV CO CO 98050470843
11K346 TRAILER IN 91 KTY 1KKVE4824ML090283 HV CO CO 98050470844
11K347 TRAILER IN 91 KTY 1KKVE4826ML090284 HV CO CO 98050470845
11K352 TRAILER IN 87 KTY 1KKVE4720HL080325 HV CO CO 98050470846
11K353 TRAILER IN 87 KTY 1KKVE4722HL080326 HV CO CO 98050470847
11K357 TRAILER IN 87 KTY 1KKVE4724HL080330 HV CO CO 98050470848
11K358 TRAILER IN 87 KTY 1KKVE4726HL080331 HV CO CO 98050470849
11K360 TRAILER IN 87 KTY 1KKVE472XHL080333 HV CO CO 98050470850
11K362 TRAILER IN 87 KTY 1KKVE4723HL080335 HV CO CO 98050470851
11K365 TRAILER IN 87 KTY 1KKVE4729HL080338 HV CO CO 98050470852
11K366 TRAILER IN 87 KTY 1KKVE4720HL080339 RS CL LA 98050470853
11K367 TRAILER IN 87 KTY 1KKVE4727HL080340 HV CO CO 98050470854
11K368 TRAILER IN 87 KTY 1KKVE4729HL080341 RS CL LA 98050470855
11K371 TRAILER IN 87 KTY 1KKVE4724HL080344 HV CO CO 98050470856
11K372 TRAILER IN 87 KTY 1KKVE4726HL080345 HV CO CO 98050470857
11K375 TRAILER IN 87 KTY 1KKVE4721HL080348 HV DC 02 98050470858
11K376 TRAILER IN 87 KTY 1KKVE4825HL080349 HV CO CO 98050470859
11K377 TRAILER IN 87 KTY 1KKVE4821HL080350 HV CO CO 98050470860
11K379 TRAILER IN 87 KTY 1KKVE4825HL080352 RS CO CO 98050470861
11K380 TRAILER IN 87 KTY 1KKVE4827HL080353 HV CO CO 98050470862
11K381 TRAILER IN 87 KTY 1KKVE4829HL080354 HV CO CO 98050470863
11K382 TRAILER IN 87 KTY 1KKVE4820HL080355 RS CO CO 98050470864
11K384 TRAILER IN 87 KTY 1KKVE4824HL080357 RS CO CO 98050470865
11K385 TRAILER IN 87 KTY 1KKVE4826HL080358 HV CO CO 98050470866
11K386 TRAILER IN 87 KTY 1KKVE4828HL080359 HV CO CO 98050470867
11K387 TRAILER IN 87 KTY 1KKVE4824HL080360 RS CO CO 98050470868
11K388 TRAILER IN 87 KTY 1KKVE4826HL080361 RS CL LA 98050470869
11K389 TRAILER IN 87 KTY 1KKVE4828HL080362 HV CO CO 98050470870
11K390 TRAILER IN 87 KTY 1KKVE482XHL080363 RS CO CO 98050470871
11K391 TRAILER IN 87 KTY 1KKVE4821HL080364 RS CO CO 98050470872
11K392 TRAILER IN 87 KTY 1KKVE4823HL080365 HV CO CO 98050470873
11K393 TRAILER IN 87 KTY 1KKVE4825HL080366 RS CO CO 98050470812
11K394 TRAILER IN 87 KTY 1KKVE4827HL080367 HV CO CO 98050470815
11K395 TRAILER IN 87 KTY 1KKVE4829HL080368 HV CO CO 98050470817
</TABLE>
<PAGE>
PAGE 21
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11K396 TRAILER IN 87 KTY 1KKVE4820HL080369 RS CO CO 98050470818
11K397 TRAILER IN 87 KTY 1KKVE4827HL080370 HV CO CO 98050470819
11K398 TRAILER IN 87 KTY 1KKVE4829HL080371 RS CL LA 98050470821
11K399 TRAILER IN 87 KTY 1KKVE4820HL080372 HV CO CO 98050470825
11K400 TRAILER IN 87 KTY 1KKVE4822HL080373 HV CO CO 98050470828
11K439 TRAILER IN 91 KTY 1KKVE4828ML090285 HV CO CO 98050470830
11K441 TRAILER IN 88 KTY 1KKVE4827JL081525 HV CO CO 98050470874
11K442 TRAILER IN 88 KTY 1KKVE4829JL081526 HV CO CO 98050470875
11K443 TRAILER IN 88 KTY 1KKVE4820JL081527 HV CO CO 98050470876
11K444 TRAILER IN 88 KTY 1KKVE4822JL081528 RS CO CO 98050470877
11K445 TRAILER IN 88 KTY 1KKVE4824JL081529 RS CO CO 98050470878
11K446 TRAILER IN 88 KTY 1KKVE4820JL081530 HV CO CO 98050470879
11K447 TRAILER IN 88 KTY 1KKVE4822JL081531 HV CO CO 98050470880
11K448 TRAILER IN 88 KTY 1KKVE4824JL081532 RS CO CO 98050470881
11K449 TRAILER IN 88 KTY 1KKVE4826JL081533 HV CO CO 98050470882
11K450 TRAILER IN 88 KTY 1KKVE4828JL081534 HV CO CO 98050470883
11K451 TRAILER IN 88 KTY 1KKVE482XJL081535 HV CO CO 98050470884
11K452 TRAILER IN 88 KTY 1KKVE4821JL081536 HV CO CO 98050470885
11K453 TRAILER IN 88 KTY 1KKVE4823JL081537 HV CO CO 98050470886
11K454 TRAILER IN 88 KTY 1KKVE4825JL081538 RS CO CO 98050470887
11K455 TRAILER IN 88 KTY 1KKVE4827JL081539 HV CO CO 98050470888
11K456 TRAILER IN 88 KTY 1KKVE4823JL081540 RS CO CO 98050470889
11K457 TRAILER IN 88 KTY 1KKVE4825JL081541 HV CO CO 98050470890
11K458 TRAILER IN 88 KTY 1KKVE4827JL081542 HV CO CO 98050470891
11K459 TRAILER IN 88 KTY 1KKVE4829JL081543 HV CO CO 98050470892
11K460 TRAILER IN 88 KTY 1KKVE4820JL081544 HV CO CO 98050470893
11K462 TRAILER IN 88 KTY 1KKVE4824JL081546 HV CO CO 98050470895
11K463 TRAILER IN 88 KTY 1KKVE4826JL081547 HV CO CO 98050470896
11K464 TRAILER IN 88 KTY 1KKVE4828JL081548 HV CO CO 98050470897
11K465 TRAILER IN 88 KTY 1KKVE482XJL081549 HV CO CO 98050470898
11K487 TRAILER IN 91 KTY 1KKVE482XML090286 HV CO CO 98050470899
11K513 TRAILER IN 88 KTY 1KKVE4825JL081698 HV CO CO 98050470900
11K514 TRAILER IN 88 KTY 1KKVE4827JL081699 RS CO CO 98050470901
11K515 TRAILER IN 88 KTY 1KKVE482XJL081700 HV CO CO 98050470902
11K517 TRAILER IN 88 KTY 1KKVE4823JL081702 RS CO CO 98050470903
11K518 TRAILER IN 88 KTY 1KKVE4825JL081703 HV CL LA 98050470904
11K519 TRAILER IN 88 KTY 1KKVE4827JL081704 HV CL LA 98050470905
11K520 TRAILER IN 88 KTY 1KKVE4829JL081705 HV CO CO 98050470906
11K521 TRAILER IN 88 KTY 1KKVE4820JL081706 HV CO CO 98050470907
11K522 TRAILER IN 88 KTY 1KKVE4822JL081707 RS CO CO 98050470908
11K523 TRAILER IN 88 KTY 1KKVE4824JL081708 HV CO CO 98050470909
11K524 TRAILER IN 88 KTY 1KKVE4826JL081709 RS CO CO 98050470910
11K525 TRAILER IN 88 KTY 1KKVE4822JL081710 RS CO CO 98050470911
11K526 TRAILER IN 88 KTY 1KKVE4824JL081711 RS CO CO 98050470912
11K527 TRAILER IN 88 KTY 1KKVE4826JL081712 HV CO CO 98050470913
11K528 TRAILER IN 88 KTY 1KKVE4828JL081713 RS CO CO 98050470914
11K529 TRAILER IN 88 KTY 1KKVE482XJL081714 RS CO CO 98050470915
11K530 TRAILER IN 88 KTY 1KKVE4821JL081715 HV CO CO 98050470916
11K531 TRAILER IN 88 KTY 1KKVE4823JL081716 HV CO CO 98050470917
11K532 TRAILER IN 88 KTY 1KKVE4825JL081717 RS CO CO 98050470918
</TABLE>
<PAGE>
PAGE 22
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11K533 TRAILER IN 88 KTY 1KKVE4827JL081718 HV CO CO 98050470919
11K534 TRAILER IN 88 KTY 1KKVE4829JL081719 HV CO CO 98050470920
11K535 TRAILER IN 88 KTY 1KKVE4825JL081720 HV CO CO 98050470921
11K536 TRAILER IN 88 KTY 1KKVE4827JL081721 RS CO CO 98050470922
11K537 TRAILER IN 88 KTY 1KKVE4829JL081722 RS CO CO 98050470923
11K538 TRAILER IN 88 KTY 1KKVE4820JL081723 HV CO CO 98050470924
11K539 TRAILER IN 88 KTY 1KKVE4824JL081692 HV CO CO 98050470925
11K540 TRAILER IN 88 KTY 1KKVE4826JL081693 HV CL LA 98050470926
11K541 TRAILER IN 88 KTY 1KKVE4828JL081694 RS CO CO 98050470927
11K542 TRAILER IN 88 KTY 1KKVE482XJL081695 RS CO CO 98050470928
11K543 TRAILER IN 88 KTY 1KKVE4821JL081696 RS CO CO 98050470929
11K544 TRAILER IN 88 KTY 1KKVE4823JL081697 RS CO CO 98050470930
11K652 TRAILER IN 91 KTY 1KKVE4821ML090287 HV CO CO 98050470931
11K660 TRAILER IN 88 KTY 1KKVE4823JL082736 RS CL LA 98050470932
11K661 TRAILER IN 88 KTY 1KKVE4825JL082737 HV CL LA 98050470933
11K662 TRAILER IN 88 KTY 1KKVE4827JL082738 HV CL LA 98050470934
11K664 TRAILER IN 88 KTY 1KKVE4825JL082740 HV CO CO 98050470936
11K665 TRAILER IN 88 KTY 1KKVE4827JL082741 RS CL LA 98050470937
11K666 TRAILER IN 88 KTY 1KKVE4829JL082742 HV CL LA 98050470938
11K667 TRAILER IN 88 KTY 1KKVE4820JL082743 HV CO CO 98050470939
11K668 TRAILER IN 88 KTY 1KKVE4822JL082744 HV CO CO 98050470940
11K669 TRAILER IN 88 KTY 1KKVE4824JL082745 RS CL LA 98050470941
11K670 TRAILER IN 88 KTY 1KKVE4826JL082746 HV CO CO 98050470942
11K671 TRAILER IN 88 KTY 1KKVE4828JL082747 RS CL LA 98050470943
11K672 TRAILER IN 88 KTY 1KKVE482XJL082748 HV CO CO 98050470944
11K673 TRAILER IN 88 KTY 1KKVE4821JL082749 HV CO CO 98050470945
11K674 TRAILER IN 88 KTY 1KKVE4828JL082750 HV CO CO 98050470946
11K675 TRAILER IN 88 KTY 1KKVE482XJL082751 HV CO CO 98050470947
11K676 TRAILER IN 88 KTY 1KKVE4821JL082752 HV CO CO 98050470948
11K677 TRAILER IN 88 KTY 1KKVE4823JL082753 HV CO CO 98050470949
11K678 TRAILER IN 88 KTY 1KKVE4825JL082754 HV CO CO 98050470950
11K679 TRAILER IN 88 KTY 1KKVE4827JL082755 HV CO CO 98050470951
11K680 TRAILER IN 88 KTY 1KKVE4829JL082756 HV CL LA 98050470952
11K681 TRAILER IN 88 KTY 1KKVE4820JL082757 HV CO CO 98050470953
11K682 TRAILER IN 88 KTY 1KKVE4822JL082758 HV CO CO 98050470954
11K683 TRAILER IN 88 KTY 1KKVE4824JL082759 HV CO CO 98050470955
11K684 TRAILER IN 88 KTY 1KKVE4820JL082760 HV CO CO 98050470956
11K685 TRAILER IN 88 KTY IKKVE4822JL082761 HV CO CO 98050470957
11K686 TRAILER IN 88 KTY IKKVE4824JL082762 HV CO CO 98050470958
11K687 TRAILER IN 88 KTY 1KKVE4826JL082763 RS CO CO 98050470959
11K688 TRAILER IN 88 KTY 1KKVE4828JL082764 HV CO CO 98050470960
11K689 TRAILER IN 88 KTY 1KKVE482XJL082765 HV CO CO 98050470961
11K690 TRAILER IN 88 KTY 1KKVE4821JL082766 HV CO CO 98050470962
11K691 TRAILER IN 88 KTY 1KKVE4823JL082767 HV CO CO 98050470963
11K692 TRAILER IN 88 KTY 1KKVE4825JL082768 HV CO CO 98050470964
11K693 TRAILER IN 88 KTY 1KKVE4827JL082769 HV CO CO 98050470965
11K694 TRAILER IN 88 KTY 1KKVE4823JL082770 HV CO CO 98050470966
11K695 TRAILER IN 88 KTY 1KKVE4825JL082771 HV CO CO 98050470967
11K696 TRAILER IN 88 KTY 1KKVE4827JL082772 HV CL LA 98050470968
11K699 TRAILRER IN 91 KTY 1KKVE4823ML090288 HV CO CO 98050470969
</TABLE>
<PAGE>
Page 23
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11K701 TRAILER IN 89 KTY 1KKVE4826KL083705 RS CO CO 98050470971
11K702 TRAILER IN 89 KTY 1KKVE4828KL083706 HV CO CO 98050470972
11K703 TRAILER IN 89 KTY 1KKVE482XKL083707 RS CO CO 98050470973
11K704 TRAILER IN 89 KTY 1KKVE4821KL083708 HV CO CO 98050470974
11K705 TRAILER IN 89 KTY 1KKVE4823KL083709 HV CO CO 98050470975
11K706 TRAILER IN 89 KTY 1KKVE482XKL083710 RS CO CO 98050470976
11K707 TRAILER IN 89 KTY 1KKVE4821KL083711 HV CO CO 98050470977
11K708 TRAILER IN 89 KTY 1KKVE4823KL083712 HV CO CO 98050470978
11K709 TRAILER IN 89 KTY 1KKVE4825KL083713 HV CO CO 98050470979
11K710 TRAILER IN 89 KTY 1KKVE4827KL083714 RS CO CO 98050470980
11K711 TRAILER IN 89 KTY 1KKVE4829KL083715 HV CO CO 98050470981
11K712 TRAILER IN 89 KTY 1KKVE482OKL083716 HV CO CO 98050470982
11K713 TRAILER IN 89 KTY 1KKVE4822KL083717 HV CO CO 98050570983
11K714 TRAILER IN 89 KTY 1KKVE4824KL083718 HV CO CO 98050470984
11K715 TRAILER IN 89 KTY 1KKVE4826KL083719 RS CO CO 98050470985
11K716 TRAILER IN 89 KTY 1KKVE4822KLO83720 HV CO CO 98050470986
11K717 TRAILER IN 89 KTY 1KKVE4824KL083721 RS CO CO 98050470987
11K718 TRAILER IN 89 KTY 1KKVE4826KL083722 RS CO CO 98050470988
11K719 TRAILER IN 89 KTY 1KKVE4828KL083723 RS CO CO 98050470989
11K720 TRAILER IN 89 KTY 1KKVE482XKL083724 RS CO CO 98050470990
11K721 TRAILER IN 89 KTY 1KKVE4821KL083725 RS CO CO 98050470991
11K722 TRAILER IN 89 KTY 1KKVE4823KL083726 HV CO CO 98050470992
11K723 TRAILER IN 89 KTY 1KKVE4825KL083727 HV CO CO 98050470993
11K724 TRAILER IN 89 KTY 1KKVE4827KL083728 HV CO CO 98050470994
11K725 TRAILER IN 89 KTY 1KKVE4829KL083729 HV CO CO 98050470995
11K726 TRAILER IN 89 KTY 1KKVE4825KL083730 HV CO CO 98050470996
11K727 TRAILER IN 89 KTY 1KKVE4827KL083731 HV CO CO 98050470997
11K728 TRAILER IN 89 KTY 1KKVE4829KL083732 HV CO CO 98050470998
11K729 TRAILER IN 89 KTY 1KKVE4820KL083733 HV CO CO 98050470999
11K730 TRAILER IN 89 KTY 1KKVE4822KL083734 RS CO CO 98050472001
11K731 TRAILER IN 89 KTY 1KKVE4824KL083735 HV CO CO 98050472002
11K732 TRAILER IN 89 KTY 1KKVE4826KL083736 HV CO CO 98050472003
11K733 TRAILER IN 89 KTY 1KKVE4828KL083737 HV CO CO 98050472004
11K734 TRAILER IN 89 KTY 1KKVE482XKL083738 HV CO CO 98050472005
11K735 TRAILER IN 89 KTY 1KKVE4821KL083739 HV CO CO 98050472006
11K736 TRAILER IN 89 KTY 1KKVE4828KL083740 HV CO CO 98050472007
11K737 TRAILER IN 89 KTY 1KKVE482XKL083741 RS CO CO 98050472008
11K738 TRAILER IN 89 KTY 1KKVE4821KL083742 HV CO CO 98050472009
11K739 TRAILER IN 89 KTY 1KKVE4823KL083743 HV CO CO 98050472010
11K740 TRAILER IN 89 KTY 1KKVE4825KL083744 HV CO CO 98050472011
11K741 TRAILER IN 89 KTY 1KKVE4827KL083745 HV CO CO 98050472012
11K742 TRAILER IN 89 KTY 1KKVE4829KL083746 RS CO CO 98050472013
11K743 TRAILER IN 89 KTY 1KKVE4820KL083747 HV CO CO 98050472014
11K744 TRAILER IN 89 KTY 1KKVE4822KL083748 HV CO CO 98050472015
11K745 TRAILER IN 89 KTY 1KKVE4820KL083750 RS CO CO 98050472016
11K746 TRAILER IN 89 KTY 1KKVE4822KL083751 HV CO CO 98050472017
11K748 TRAILER IN 89 KTY 1KKVE4826KL083753 HV CO CO 98050472018
11K749 TRAILER IN 89 KTY 1KKVE4828KL083754 HV CO CO 98050472019
11K750 TRAILER IN 89 KTY 1KKVE482XKL083755 HV CO CO 98050472020
11K751 TRAILER IN 89 KTY 1KKVE4821KL083756 HV CO CO 98050472021
</TABLE>
<PAGE>
PAGE 24
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11K752 TRAILER IN 89 KTY 1KKVE4823KL083757 HV CO CO 98050472022
11K753 TRAILER IN 89 KTY 1KKVE4825KL083758 HV CO CO 98050472023
11K754 TRAILER IN 89 KTY 1KKVE4827KL083759 HV CO CO 98050472024
11K755 TRAILER IN 89 KTY 1KKVE4823KL083760 HV CL LA 98050472025
11K756 TRAILER IN 89 KTY 1KKVE4825KL083761 HV CO CO 98050472026
11K757 TRAILER IN 89 KTY 1KKVE4827KL083762 HV CO CO 98050472027
11K758 TRAILER IN 89 KTY 1KKVE4829KL083763 RS CO CO 98050472028
11K759 TRAILER IN 89 KTY 1KKVE4820KL083764 HV CO CO 98050472029
11K760 TRAILER IN 89 KTY 1KKVE4822KL083765 HV CO CO 98050472030
11K761 TRAILER IN 89 KTY 1KKVE4824KL083766 HV CO CO 98050472031
11K762 TRAILER IN 89 KTY 1KKVE4826KL083767 HV CO CO 98050472032
11K763 TRAILER IN 89 KTY 1KKVE4828KL083768 HV CL LA 98050472033
11K764 TRAILER IN 89 KTY 1KKVE482XKL083769 RS CO CO 98050472034
11K765 TRAILER IN 89 KTY 1KKVE4826KL083770 RS CO CO 98050472035
11K766 TRAILER IN 89 KTY 1KKVE4828KL083771 HV CO CO 98050472036
11K767 TRAILER IN 89 KTY 1KKVE482XKL083772 HV CO CO 98050472037
11K768 TRAILER IN 89 KTY 1KKVE4821KL083773 RS CO CO 98050472038
11K769 TRAILER IN 89 KTY 1KKVE4823KL083774 HV CO CO 98050472039
11K770 TRAILER IN 89 KTY 1KKVE4825KL083775 HV CO CO 98050472040
11K771 TRAILER IN 89 KTY 1KKVE4827KL083776 HV CO CO 98050472041
11K772 TRAILER IN 89 KTY 1KKVE4829KL083777 HV CO CO 98050472042
11K773 TRAILER IN 89 KTY 1KKVE4820KL083778 HV CO CO 98050472043
11K774 TRAILER IN 89 KTY 1KKVE4822KL083779 RS CO CO 98050472044
11K775 TRAILER IN 89 KTY 1KKVE4829KL083780 HV CO CO 98050472045
11K776 TRAILER IN 89 KTY 1KKVE4820KL083781 HV CO CO 98050472046
11K777 TRAILER IN 89 KTY 1KKVE4822KL083782 HV CO CO 98050472047
11K778 TRAILER IN 89 KTY 1KKVE4824KL083783 HV CO CO 98050472048
11K779 TRAILER IN 89 KTY 1KKVE4826KL083784 RS CO CO 98050472049
11K780 TRAILER IN 89 KTY 1KKVE4828KL083785 RS CO CO 98050472050
11K781 TRAILER IN 89 KTY 1KKVE482XKL083786 RS CO CO 98050472051
11K782 TRAILER IN 89 KTY 1KKVE4821KL083787 HV CO CO 98050472052
11K783 TRAILER IN 89 KTY 1KKVE4823KL083788 HV CO CO 98050472053
11K784 TRAILER IN 89 KTY 1KKVE4825KL083789 HV CO CO 98050472054
11K785 TRAILER IN 89 KTY 1KKVE4821KL083790 HV CO CO 98050472070
11K787 TRAILER IN 89 KTY 1KKVE4825KL083792 HV CO CO 98050472090
11K788 TRAILER IN 89 KTY 1KKVE4827KL083793 HV CO CO 98050472097
11K789 TRAILER IN 89 KTY 1KKVE4824KL083749 HV CL LA 98050472126
11K790 TRAILER IN 89 KTY 1KKVE4721KL084732 HV CO CO 98050472136
11K791 TRAILER IN 89 KTY 1KKVE4723KL084733 HV CO CO 98050472144
11K793 TRAILER IN 89 KTY 1KKVE4727KL084735 HV CO CO 98050472151
11K794 TRAILER IN 89 KTY 1KKVE4729KL084736 HV CO CO 98050472158
11K795 TRAILER IN 89 KTY 1KKVE4720KL084737 HV CO CO 98050472166
11K796 TRAILER IN 89 KTY 1KKVE4722KL084738 HV CO CO 98050472172
11K797 TRAILER IN 89 KTY 1KKVE4724KL084739 HV CO CO 98050472061
11K798 TRAILER IN 89 KTY 1KKVE4720KL084740 HV CO CO 98050472073
11K799 TRAILER IN 89 KTY 1KKVE4722KL084741 HV CO CO 98050472081
11K800 TRAILER IN 89 KTY 1KKVE4724KL084742 HV CO CO 98050472091
11K801 TRAILER IN 89 KTY 1KKVE4726KL084743 HV CO CO 98050472103
11K802 TRAILER IN 89 KTY 1KKVE4728KL084744 HV CO CO 98050472112
11K803 TRAILER IN 89 KTY 1KKVE472XKL084745 HV CO CO 98050472119
</TABLE>
<PAGE>
PAGE 25
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11KB805 TRAILER IN 89 KTY 1KKVE4723KL084747 HV CO CO 98050472129
11KB806 TRAILER IN 89 KTY 1KKVE4725KL084748 HV CO CO 98050472139
11KB807 TRAILER IN 89 KTY 1KKVE4727KL084749 HV CO CO 98050472147
11KB808 TRAILER IN 89 KTY 1KKVE4723KL084750 HV CO CO 98050472156
11KB809 TRAILER IN 89 KTY 1KKVE4725KL084751 HV CO CO 98050472167
11KB810 TRAILER IN 89 KTY 1KKVE4727KLO84752 HV CO CO 98050472178
11KB811 TRAILER IN 89 KTY 1KKVE4729KL084753 HV CO CO 98050472188
11KB812 TRAILER IN 89 KTY 1KKVE4720KLO84754 HV CO CO 98050472198
11KB813 TRAILER IN 89 KTY 1KKVE4722KL084755 HV CO CO 98050472207
11KB814 TRAILER IN 89 KTY 1KKVE4826KL084756 HV CO CO 98050472216
11KB816 TRAILER IN 89 KTY 1KKVE482XKL084758 HV CO CO 98050472237
11KB817 TRAILER IN 89 KTY 1KKVE4821KL084759 HV CO CO 98050472246
11KB818 TRAILER IN 89 KTY 1KKVE4828KL084760 HV CO CO 98050472255
11KB819 TRAILER IN 89 KTY 1KKVE482XKL084761 RS CO CO 98050472264
11KB820 TRAILER IN 89 KTY 1KKVE4821KLO84762 HV CO CO 98050472271
11KB821 TRAILER IN 89 KTY 1KKVE4823KLO84763 HV CO CO 98050472278
11KB822 TRAILER IN 89 KTY 1KKVE4825KL084764 RS CO CO 98050472284
11KB823 TRAILER IN 89 KTY 1KKVE4827KLO84765 HV CO CO 98050472293
11KB824 TRAILER IN 89 KTY 1KKVE4829KL084766 HV CO CO 98050472300
11KB825 TRAILER IN 89 KTY 1KKVE4820KL084767 HV CO CO 98050472308
11KB826 TRAILER IN 89 KTY 1KKVE4822KL084768 HV CO CO 98050472314
11KB827 TRAILER IN 89 KTY 1KKVE4824KLO84769 HV CO CO 98050472323
11KB828 TRAILER IN 89 KTY 1KKVE4820KL084770 HV CO CO 98050472333
11KB829 TRAILER IN 89 KTY 1KKVE4822KL084771 HV CO CO 98050472341
11KB830 TRAILER IN 89 KTY 1KKVE4824KL084772 HV CO CO 98050472350
11KB831 TRAILER IN 89 KTY 1KKVE4826KL084773 RS CO CO 98050472359
11KB832 TRAILER IN 89 KTY 1KKVE4828KL084774 RS CO CO 98050472366
11KB833 TRAILER IN 89 KTY 1KKVE482XKL084775 HV CO CO 98050472374
11KB834 TRAILER IN 89 KTY 1KKVE4821KL084776 HV CO CO 98050472386
11KB835 TRAILER IN 89 KTY 1KKVE4823KL084777 HV CO CO 98050472397
11KB836 TRAILER IN 89 KTY 1KKVE4825KL084778 HV CO CO 98050472405
11KB837 TRAILER IN 89 KTY 1KKVE4827KL084779 HV CO CO 98050472413
11KB838 TRAILER IN 89 KTY 1KKVE4823KL084780 HV CO CO 98050472421
11KB839 TRAILER IN 89 KTY 1KKVE4825KL084781 HV CO CO 98050472429
11KB840 TRAILER IN 89 KTY 1KKVE4827KL084782 HV CO CO 98050472438
11KB841 TRAILER IN 89 KTY 1KKVE4829KL084783 RS CO CO 98050472450
11KB842 TRAILER IN 89 KTY 1KKVE4820KL084784 HV CO CO 98050472456
11KB843 TRAILER IN 89 KTY 1KKVE4822KL084785 HV CL LA 98050472466
11KB844 TRAILER IN 89 KTY 1KKVE4824KL084786 HV CO CO 98050472473
11KB845 TRAILER IN 89 KTY 1KKVE4826KL084787 HV CO CO 98050472480
11KB846 TRAILER IN 89 KTY 1KKVE4828KL084788 HV CO CO 98050472490
11KB847 TRAILER IN 89 KTY 1KKVE482XKL084789 HV CO CO 98050472496
11KB848 TRAILER IN 89 KTY 1KKVE4826KL084790 HV CO CO 98050472058
11KB849 TRAILER IN 89 KTY 1KKVE4828KL084791 HV CO CO 98050472065
11KB850 TRAILER IN 89 KTY 1KKVE482XKL084792 HV CL LA 98050472071
11KB851 TRAILER IN 89 KTY 1KKVE4821KL084793 HV CO CO 98050472077
11KB852 TRAILER IN 89 KTY 1KKVE4823KL084794 HV CL LA 98050472084
11KB853 TRAILER IN 89 KTY 1KKVE4825KL084795 HV CO CO 98050472092
11KB854 TRAILER IN 89 KTY 1KKVE4827KL084796 RS CO CO 98050472098
11KB855 TRAILER IN 89 KTY 1KKVE4829KL084797 RS CL LA 98050472108
</TABLE>
<PAGE>
PAGE 26
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11K856 TRAILER IN 89 KTY IKKVE4820KL084798 HV CO CO 98050472115
11K857 TRAILER IN 89 KTY 1KKVE4822KL084799 HV CO CO 98050472123
11K858 TRAILER IN 89 KTY 1KKVE4825KL084800 HV CO CO 98050472134
11K859 TRAILER IN 89 KTY 1KKVE4827KL084801 HV CO CO 98050472143
11K860 TRAILER IN 89 KTY 1KKVE4829KL084802 HV CO CO 98050472150
11K861 TRAILER IN 89 KTY 1KKVR452XKL084803 HV CO CO 98050472161
11K862 TRAILER IN 89 KTY 1KKVR4521KL084804 HV CO CO 98050472179
11K863 TRAILER IN 89 KTY 1KKVR4523KL084805 HV CO CO 98050472189
11K864 TRAILER IN 89 KTY 1KKVR4525KL084806 HV CO CO 98050472196
11K865 TRAILER IN 89 KTY 1KKVR4527KL084807 HV CO CO 98050472206
11K866 TRAILER IN 89 KTY 1KKVR4529KL084808 HV CO CO 98050472213
11K867 TRAILER IN 89 KTY 1KKVR4520KL084809 HV CO CO 98050472221
11K868 TRAILER IN 89 KTY 1KKVR4527KL084810 HV CO CO 98050472228
11K871 TRAILER IN 91 KTY 1KKVE4825ML090289 HV CO CO 98050472239
11K872 TRAILER IN 91 KTY 1KKVE4821ML090290 HV CO CO 98050472250
11K874 TRAILER IN 91 KTY 1KKVE4823ML090291 HV CO CO 98050472257
11K875 TRAILER IN 91 KTY 1KKVE4825ML090292 HV CO CO 98050472265
11K876 TRAILER IN 91 KTY 1KKVE4827ML090293 HV CO CO 98050472272
11K877 TRAILER IN 91 KTY 1KKVE4829ML090294 HV CO CO 98050472279
11K878 TRAILER IN 91 KTY 1KKVE4820ML090295 RS CO CO 98050472286
11K879 TRAILER IN 91 KTY 1KKVE4822ML090296 HV CO CO 98050472292
11K882 TRAILER IN 91 KTY 1KKVE4824ML090297 HV CO CO 98050472299
11K883 TRAILER IN 91 KTY 1KKVE4826ML090298 HV CO CO 98050472306
11K884 TRAILER IN 88 KTY 1KKVO4823JL082691 HV CO CO 98050472316
11K886 TRAILER IN 90 KTY 1KKVA4828LL088188 HV CO CO 98050472322
11K887 TRAILER IN 90 KTY 1KKVA482XLL088189 HV CO CO 98050472332
11K888 TRAILER IN 90 KTY 1KKVA4826LL088190 HV CL LA 98050472344
11K889 TRAILER IN 90 KTY 1KKVA4828LL088191 HV CO CO 98050472353
11K890 TRAILER IN 90 KTY 1KKVA482XLL088192 HV CO CO 98050472361
11K891 TRAILER IN 90 KTY 1KKVA4821LL088193 HV CO CO 98050472368
11K892 TRAILER IN 90 KTY 1KKVA4823LL088194 HV CO CO 98050472378
11K893 TRAILER IN 90 KTY 1KKVA4825LL088195 HV CO CO 98050472385
11K894 TRAILER IN 90 KTY 1KKVA4827LL088196 HV CL LA 98050472396
11K895 TRAILER IN 90 KTY 1KKVA4829LL088197 HV CO CO 98050472407
11K896 TRAILER IN 90 KTY 1KKVA4820LL088198 HV CO CO 98050472412
11K898 TRAILER IN 90 KTY 1KKVA4825LL088200 HV CL LA 98050472432
11K899 TRAILER IN 90 KTY 1KKVA4827LL088201 HV CO CO 98050472442
11K900 TRAILER IN 90 KTY 1KKVA4829LL088202 HV CO CO 98050472451
11K901 TRAILER IN 90 KTY 1KKVA4820LL088203 HV CO CO 98050472457
11K902 TRAILER IN 90 KTY 1KKVA4822LL088204 HV CO CO 98050472467
11K903 TRAILER IN 90 KTY 1KKVA4824LL088205 HV CO CO 98050472475
11K904 TRAILER IN 90 KTY 1KKVA4826LL088206 HV CO CO 98050472059
11K905 TRAILER IN 90 KTY 1KKVA4828LL088207 HV CO CO 98050472064
11K906 TRAILER IN 90 KTY 1KKVR4527LL088177 HV CO CO 98050472072
11K907 TRAILER IN 90 KTY 1KKVR4529LL088178 HV CO CO 98050472078
11K908 TRAILER IN 90 KTY 1KKVR4520LL088179 HV CO CO 98050472089
11K909 TRAILER IN 90 KTY 1KKVR4527LL088180 HV CO CO 98050472101
11K910 TRAILER IN 90 KTY 1KKVR4529LL088181 HV CO CO 98050472113
11K911 TRAILER IN 90 KTY 1KKVR4520LL088182 HV CO CO 98050472122
11K912 TRAILER IN 90 KTY 1KKVR4522LL088183 HV CO CO 98050472131
</TABLE>
<PAGE>
PAGE 27
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11K913 TRAILER IN 90 KTY IKKVR4524LL088184 HV CO CO 98050472141
11K914 TRAILER IN 91 KTY 1KKVE4828ML090299 HV CO CO 98050472152
11K915 TRAILER IN 91 KTY 1KKVE4825ML090300 HV CO CO 98050472164
11K916 TRAILER IN 91 KTY 1KKVE4822ML090301 HV CO CO 98050472173
11K917 TRAILER IN 91 KTY 1KKVE4824ML090302 HV CO CO 98050472183
11K918 TRAILER IN 91 KTY 1KKVE4826ML090303 HV CO CO 98050472193
11K919 TRAILER IN 91 KTY 1KKVE4828ML090304 HV CO CO 98050472204
11K920 TRAILER IN 91 KTY 1KKVE482XML090305 HV CO CO 98050472212
11K921 TRAILER IN 91 KTY 1KKVE4821ML090306 HV CO CO 98050472222
11K922 TRAILER IN 91 KTY 1KKVE4823ML090307 HV CO CO 98050472232
11K923 TRAILER IN 91 KTY 1KKVE4825ML090308 HV CO CO 98050472242
11K924 TRAILER IN 91 KTY 1KKVE4827ML090309 HV CO CO 98050472251
11K925 TRAILER IN 91 KTY 1KKVE4823ML090310 HV CO CO 98050472260
11K927 TRAILER IN 91 KTY 1KKVE4827ML090312 HV CO CO 98050472270
11K928 TRAILER IN 91 KTY 1KKVE4829ML090313 HV CO CO 98050472277
11K929 TRAILER IN 91 KTY 1KKVE4820ML090314 HV CO CO 98050472287
11K930 TRAILER IN 91 KTY 1KKVE4822ML090315 HV CO CO 98050472294
11K931 TRAILER IN 91 KTY 1KKVE4824ML090316 HV CO CO 98050472303
11K932 TRAILER IN 91 KTY 1KKVE4826ML090317 HV CO CO 98050472311
11K933 TRAILER IN 91 KTY 1KKVE4828ML090318 HV CO CO 98050472319
11K934 TRAILER IN 91 KTY 1KKVE482XML090319 HV CO CO 98050472328
11K935 TRAILER IN 91 KTY 1KKVE5327ML090355 HV CO CO 98050472338
11K936 TRAILER IN 91 KTY 1KKVE5329ML090356 HV CO CO 98050472349
11K937 TRAILER IN 91 KTY 1KKVE5320ML090357 HV CO CO 98050472358
11K938 TRAILER IN 91 KTY 1KKVA5328ML090358 HV CO CO 98050472370
11K939 TRAILER IN 91 KTY 1KKVA532XML090359 HV CO CO 98050472380
11K940 TRAILER IN 91 KTY 1KKVA5326ML090360 HV CO CO 98050472391
11K941 TRAILER IN 91 KTY 1KKVE5322ML090361 HV CO CO 98050472399
11K942 TRAILER IN 91 KTY 1KKVE5324ML090362 HV CO CO 98050472408
11K943 TRAILER IN 91 KTY 1KKVE4826ML090320 HV CO CO 98050472415
11K944 TRAILER IN 91 KTY 1KKVE4828ML090321 HV CO CO 98050472424
11K945 TRAILER IN 91 KTY 1KKVE482XML090322 HV CO CO 98050472431
11K946 TRAILER IN 91 KTY 1KKVE4821ML090323 HV CO CO 98050472439
11K947 TRAILER IN 91 KTY 1KKVE4823ML090324 HV CO CO 98050472446
11K948 TRAILER IN 91 KTY 1KKVE4825ML090325 HV CO CO 98050472454
11K949 TRAILER IN 91 KTY 1KKVE4827ML090326 HV CO CO 98050472464
11K950 TRAILER IN 91 KTY 1KKVE4829ML090327 HV CO CO 98050472471
11K951 TRAILER IN 91 KTY 1KKVE4820ML090328 HV CO CO 98050472478
11K952 TRAILER IN 91 KTY 1KKVE4822ML090329 HV CO CO 98050472484
11K953 TRAILER IN 91 KTY 1KKVE4829ML090330 HV CO CO 98050472493
11K954 TRAILER IN 91 KTY 1KKVE4820ML090331 HV CO CO 98050472503
11K955 TRAILER IN 91 KTY 1KKVE4822ML090332 HV CO CO 98050472057
11K956 TRAILER IN 91 KTY 1KKVE4824ML090333 HV CO CO 98050472063
11K957 TRAILER IN 91 KTY 1KKVE4826ML090334 HV CO CO 98050472067
11K959 TRAILER IN 91 KTY 1KKVE482XML090336 HV CO CO 98050472074
11K960 TRAILER IN 91 KTY 1KKVE4821ML090337 HV CO CO 98050472082
11K961 TRAILER IN 91 KTY 1KKVE4823ML090338 HV CO CO 98050472087
11K962 TRAILER IN 91 KTY 1KKVE4825ML090339 HV CO CO 98050472096
11K963 TRAILER IN 91 KTY 1KKVE4821ML090340 HV CO CO 98050472102
11K964 TRAILER IN 91 KTY 1KKVE4823ML090341 HV CO CO 98050472111
</TABLE>
<PAGE>
PAGE 28
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11K965 TRAILER IN 91 KTY 1KKVE4825ML090342 HV CO CO 98050472118
11K966 TRAILER IN 91 KTY 1KKVE4827ML090343 HV CO CO 98050472125
11K967 TRAILER IN 91 KTY 1KKVE4829ML090344 HV CO CO 98050472130
11K968 TRAILER IN 91 KTY 1KKVE4820ML090345 HV CO CO 98050472137
11K969 TRAILER IN 91 KTY 1KKVE4822ML090346 HV CO CO 98050472146
11K970 TRAILER IN 91 KTY 1KKVE4824ML090347 HV CO CO 98050472153
11K971 TRAILER IN 91 KTY 1KKVE4826ML090348 HV CO CO 98050472163
11K972 TRAILER IN 91 KTY 1KKVE4828ML090349 HV CO CO 98050472168
11K973 TRAILER IN 91 KTY 1KKVE4824ML090350 HV CO CO 98050472175
11K974 TRAILER IN 91 KTY 1KKVE4826ML090351 HV CO CO 98050472182
11K975 TRAILER IN 91 KTY 1KKVE4828ML090352 HV CO CO 98050472190
11K976 TRAILER IN 91 KTY 1KKVE482XML090353 HV CO CO 98050472197
11K977 TRAILER IN 91 KTY 1KKVE4821ML090354 HV CO CO 98050472203
11K978 TRAILER IN 92 W N 1JJV452S0ML164206 HV CO CO 98050472210
11K979 TRAILER IN 92 W N 1JJV452V7NL163144 HV CL LA 98050472220
11K980 TRAILER IN 92 W N 1JJV452V9NL163145 HV CO CO 98050472225
11K981 TRAILER IN 92 W N 1JJV452V0NL163146 HV CO CO 98050472233
11K982 TRAILER IN 92 W N 1JJV452V2NL163147 HV CO CO 98050472241
11K983 TRAILER IN 92 W N 1JJV452V4NL163148 HV CL LA 98050472249
11K984 TRAILER IN 92 W N 1JJV452V6NL163149 HV CO CO 98050472253
11K985 TRAILER IN 92 W N 1JJV452V2NL163150 HV CO CO 98050472261
11K986 TRAILER IN 92 W N 1JJV452V4NL163151 HV CO CO 98050472269
11K987 TRAILER IN 92 W N 1JJV452V6NL163152 HV CO CO 98050472275
11K988 TRAILER IN 92 W N 1JJV452V8NL163153 HV CO CO 98050472280
11K989 TRAILER IN 92 W N 1JJV452VXNL163154 HV CO CO 98050472288
11K999 TRAILER IN 87 KTY 1KKVE472XHL078324 HV CO CO 98050472297
11M001 TRAILER IN 85 KTY 1KKVE4827FL072766 BW CO CO 98050472305
11M002 TRAILER IN 85 KTY 1KKVE4829FL072767 BW CO CO 98050472310
11M003 TRAILER IN 85 KTY 1KKVE4820FL072768 BW CO CO 98050472317
11M004 TRAILER IN 85 KTY 1KKVE4822FL072769 BW CO CO 98050472320
11M009 TRAILER IN 85 KTY 1KKVE4826FL072774 BW CO CO 98050472327
11M011 TRAILER IN 85 KTY 1KKVE482XFL072776 BW CO CO 98050472335
11M012 TRAILER IN 85 KTY 1KKVE4821FL072777 RS CO CO 98050472339
11M013 TRAILER IN 85 KTY 1KKVE4823FL072778 BW CO CO 98050472347
11M014 TRAILER IN 85 KTY 1KKVE4825FL072779 BW CO CO 98050472354
11M017 TRAILER IN 85 KTY 1KKVE4825FL072782 BW CO CO 98050472360
11M018 TRAILER IN 85 KTY 1KKVE4827FL072783 RS CO CO 98050472371
11M019 TRAILER IN 85 KTY 1KKVE4829FL072784 BW CO CO 98050472379
11M029 TRAILER IN 85 KTY 1KKVE4821FL072794 HV DC D1 98050472392
11M030 TRAILER IN 85 KTY 1KKVE4823FL072795 BW CO CO 98050472400
11M031 TRAILER IN 85 KTY 1KKVE4825FL072796 BW CO CO 98050472409
11M033 TRAILER IN 85 KTY 1KKVE4829FL072798 RS CO CO 98050472056
11M034 TRAILER IN 85 KTY 1KKVE4820FL072799 BW CO CO 98050472060
11M038 TRAILER IN 85 KTY 1KKVE4829FL072803 BW CO CO 98050472066
11M043 TRAILER IN 85 KTY 1KKVE4828FL072808 BW CO CO 98050472075
11M046 TRAILER IN 85 KTY 1KKVE4828FL072811 BW CO CO 98050472079
11M048 TRAILER IN 85 KTY 1KKVE4821FL072813 BW CO CO 98050472086
11M049 TRAILER IN 85 KTY 1KKVE4823FL072814 BW CO CO 98050472095
11M050 TRAILER IN 85 KTY 1KKVE4825FL072815 BW CO CO 98050472106
11M056 TRAILER IN 85 KTY 1KKVE4820FL072821 BW CO CO 98050472117
</TABLE>
<PAGE>
PAGE 29
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11M058 TRAILER IN 85 KTY 1KKVE4824FL072823 HV CO CO 98050472124
11M064 TRAILER IN 85 KTY 1KKVE4825FL072829 HV CO CO 98050472133
11M065 TRAILER IN 85 KTY 1KKVE4821FL072830 RS CO CO 98050472159
11M071 TRAILER IN 85 KTY 1KKVE4822FL072836 BW CO CO 98050472169
11M079 TRAILER IN 85 KTY 1KKVE4821FL072844 BW CO CO 98050472174
11M080 TRAILER IN 85 KTY 1KKVE4823FL072845 BW CO CO 98050472184
11M084 TRAILER IN 85 KTY 1KKVE4820FL072849 RS CO CO 98050472201
11M087 TRAILER IN 85 KTY 1KKVE4820FL072852 BW CO CO 98050472214
11M088 TRAILER IN 85 KTY 1KKVE4822FL072853 HV CO CO 98050472224
11M090 TRAILER IN 85 KTY 1KKVE4826FL072855 RS CO CO 98050472234
11M093 TRAILER IN 85 KTY 1KKVE4821FL072858 BW CO CO 98050472240
11M100 TRAILER IN 85 KTY 1KKVE4829FL072865 BW CO CO 98050472248
11M102 TRAILER IN 85 KTY 1KKVE4820FL073421 BW CO CO 98050472267
11M103 TRAILER IN 85 KTY 1KKVE4822FL073422 BW CO CO 98050472281
11M105 TRAILER IN 85 KTY 1KKVE4826FL073424 RS CO CO 98050472291
11M106 TRAILER IN 85 KTY 1KKVE4828FL073425 RS CO CO 98050472298
11M108 TRAILER IN 85 KTY 1KKVE4821FL073427 BW CO CO 98050472307
11M113 TRAILER IN 85 KTY 1KKVE4825FL073432 BW CO CO 98050472321
11M115 TRAILER IN 85 KTY 1KKVE4829FL073434 RS CO CO 98050472331
11M118 TRAILER IN 85 KTY 1KKVE4824FL073437 HV DC C1 98050472340
11M119 TRAILER IN 85 KTY 1KKVE4826FL073438 RS CO CO 98050472348
11M120 TRAILER IN 85 KTY 1KKVE4828FL073439 BW CO CO 98050472356
11M122 TRAILER IN 85 KTY 1KKVE4826FL073441 RS CO CO 98050472365
11M124 TRAILER IN 85 KTY 1KKVE482XFL073443 BW CO CO 98050472373
11M126 TRAILER IN 85 KTY 1KKVE4823FL073445 BW CO CO 98050472384
11M127 TRAILER IN 85 KTY 1KKVE4825FL073446 BW CO CO 98050472394
11M128 TRAILER IN 85 KTY 1KKVE4827FL073447 HV CO CO 98050472402
11M130 TRAILER IN 85 KTY 1KKVE4820FL073449 BW CO CO 98050472426
11M131 TRAILER IN 85 KTY 1KKVE4827FL073450 BW CO CO 98050472434
11M138 TRAILER IN 85 KTY 1KKVE482XFL073457 BW CO CO 98050472447
11M139 TRAILER IN 85 KTY 1KKVE4821FL073458 BW CO CO 98050472495
11M143 TRAILER IN 85 KTY 1KKVE4823FL073462 BW CO CO 98050472461
11M147 TRAILER IN 85 KTY 1KKVE4820FL073466 BW CO CO 98050472505
11M148 TRAILER IN 85 KTY 1KKVE4822FL073467 RS CO CO 98050472511
11M153 TRAILER IN 85 KTY 1KKVE4826FL073472 BW CO CO 98050472521
11M154 TRAILER IN 85 KTY 1KKVE4828FL073473 RS CO CO 98050472533
11M157 TRAILER IN 85 KTY 1KKVE4823FL073476 BW CO CO 98050472540
11M158 TRAILER IN 85 KTY 1KKVE4825FL073477 RS CO CO 98050472550
11M159 TRAILER IN 85 KTY 1KKVE4827FL073478 BW CO CO 98050472558
11M165 TRAILER IN 85 KTY 1KKVE4822FL073484 BW CO CO 98050472516
11M167 TRAILER IN 85 KTY 1KKVE4826FL073486 BW CO CO 98050472528
11M169 TRAILER IN 85 KTY 1KKVE482XFL073488 RS CO CO 98050472537
11M177 TRAILER IN 85 KTY 1KKVE4829FL073496 HV DC C4 98050472555
11M178 TRAILER IN 85 KTY 1KKVE4820FL073497 BW CO CO 98050472563
11M181 TRAILER IN 85 KTY 1KKVE4827FL073500 BW CO CO 98050472574
11M184 TRAILER IN 85 KTY 1KKVE4822FL073503 RS CO CO 98050472584
11M193 TRAILER IN 85 KTY 1KKVE4823FL073512 HV DC O1 98050472609
11M195 TRAILER IN 85 KTY 1KKVE4827FL073514 BW CO CO 98050472621
11M200 TRAILER IN 85 KTY 1KKVE4826FL073519 BW CO CO 98050472628
11M204 TRAILER IN 85 KTY 1KKVE4827FL074100 BW CO CO 98050472643
</TABLE>
<PAGE>
PAGE 30
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11M205 TRAILER IN 85 KTY 1KKVE4829FLO74101 BH CO CO 98050472657
11M212 TRAILER IN 85 KTY 1KKVE4821FLO74108 BH CO CO 98050472664
11M213 TRAILER IN 85 KTY 1KKVE4823FLO74109 BH CO CO 98050472674
11M216 TRAILER IN 85 KTY 1KKVE4823FLO74112 HV OC 04 98050472693
11M217 TRAILER IN 85 KTY 1KKVE4825FLO74113 BH CO CO 98050472701
11M220 TRAILER IN 85 KTY 1KKVE4820FLO74116 BH CO CO 98050472710
11M222 TRAILER IN 85 KTY 1KKVE4824FLO74118 RS CO CO 98050472723
11M223 TRAILER IN 85 KTY 1KKVE4826FLO74119 BH CO CO 98050472734
11M226 TRAILER IN 85 KTY 1KKVE4826FLO74122 RS CO CO 98050472743
11M227 TRAILER IN 85 KTY 1KKVE4828FLO74123 BH CO CO 98050472753
11M228 TRAILER IN 85 KTY 1KKVE482XFLO74124 BH CO CO 98050472761
11M229 TRAILER IN 85 KTY 1KKVE4821FLO74125 BH CO CO 98050472773
11M235 TRAILER IN 85 KTY 1KKVE4827FLO74131 BH CO CO 98050472781
11M241 TRAILER IN 85 KTY 1KKVE4828FLO74137 BH CO CO 98050472799
11M246 TRAILER IN 85 KTY 1KKVE4821FLO74142 BH CO CO 98050472823
11M248 TRAILER IN 85 KTY 1KKVE4825FLO74144 BH CO CO 98050472835
11M253 TRAILER IN 85 KTY 1KKVE4824FLO74149 BH CO CO 98050472843
11M257 TRAILER IN 85 KTY 1KKVE4826FLO74153 BH CO CO 98050472851
11M260 TRAILER IN 85 KTY 1KKVE4821FLO74156 BH CO CO 98050472865
11M262 TRAILER IN 85 KTY 1KKVE4825FLO74158 BH CO CO 98050472877
11M264 TRAILER IN 85 KTY 1KKVE4823FLO74160 HV OC 01 98050472889
11M265 TRAILER IN 85 KTY 1KKVE4825FLO74161 BH CO CO 98050472896
11M269 TRAILER IN 85 KTY 1KKVE4822FLO74165 RS CO CO 98050472908
11M272 TRAILER IN 85 KTY 1KKVE4828FLO74168 BH CO CO 98050472919
11M273 TRAILER IN 85 KTY 1KKVE482XFLO74169 BH CO CO 98050472931
11M277 TRAILER IN 85 KTY 1KKVE4821FLO74173 BH CO CO 98050472939
11M282 TRAILER IN 85 KTY 1KKVE4820FLO74178 RS CO CO 98050472945
11M283 TRAILER IN 85 KTY 1KKVE4822FLO74179 BH CO CO 98050472954
11M284 TRAILER IN 85 KTY 1KKVE4829FLO74180 BH CO CO 98050472962
11M287 TRAILER IN 85 KTY 1KKVE4824FLO74183 BH CO CO 98050472969
11M291 TRAILER IN 85 KTY 1KKVE4821FLO74187 BH CO CO 98050472975
11M298 TRAILER IN 85 KTY 1KKVE4829FLO74194 HV OC 01 98050472981
11M328 TRAILER IN 86 KTY 1KKVE4829GL075038 BH CO CO 98050472989
11M331 TRAILER IN 86 KTY 1KKVE4829GLO75041 BH CO CO 98050472997
11M337 TRAILER IN 86 KTY 1KKVE482XGLO75047 BH CO CO 98050472654
11M339 TRAILER IN 86 KTY 1KKVE4823GL075049 BH CO CO 98050472663
11M345 TRAILER IN 86 KTY 1KKVE4829GLO75055 HV OC 01 98050472686
11M346 TRAILER IN 86 KTY 1KKVE4820GLO75056 BH CO CO 98050472695
11M353 TRAILER IN 86 KTY 1KKVE4828GLO75063 BH CO CO 98050472702
11M354 TRAILER IN 86 KTY 1KKVE482XGLO75064 BH CO CO 98050472716
11M356 TRAILER IN 86 KTY 1KKVE4823GLO75066 BH CO CO 98050472725
11M364 TRAILER IN 86 KTY 1KKVE4822GLO75074 BH CO CO 98050472735
11M367 TRAILER IN 86 KTY 1KKVE4828GLO75077 BH CO CO 98050472744
11M368 TRAILER IN 86 KTY 1KKVE482XGL075078 BH CO CO 98050472754
11M370 TRAILER IN 86 KTY 1KKVE4828GL075080 BH CO CO 98050472760
11M372 TRAILER IN 86 KTY 1KKVE4821GLO75082 BH CO CO 98050472771
11M378 TRAILER IN 86 KTY 1KKVE4822GLO75088 BH CO CO 98050472802
11M379 TRAILER IN 86 KTY 1KKVE4824GLO75089 BH CO CO 98050472812
11M381 TRAILER IN 86 KTY 1KKVE4822GLO75091 BH CO CO 98050472819
11M382 TRAILER IN 86 KTY 1KKVE4824GLO75092 BH CO CO 98050472830
</TABLE>
<PAGE>
PAGE 32
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11M510 TRAILER IN 86 KTY 1KKVE4829GL075220 BH CO CO 98050472763
11M511 TRAILER IN 86 KTY 1KKVE4820GL075221 BH CO CO 98050472772
11M516 TRAILER IN 86 KTY 1KKVE482XGL075226 BH CO CO 98050472783
11M520 TRAILER IN 86 KTY 1KKVE4821GL075230 BH CO CO 98050472790
11M521 TRAILER IN 86 KTY 1KKVE4823GL075231 BH CO CO 98050472803
11M522 TRAILER IN 86 KTY 1KKVE4825GL075232 BH CO CO 98050472811
11M527 TRAILER IN 86 KTY 1KKVE4824GL075237 BH CO CO 98050472820
11M531 TRAILER IN 86 KTY 1KKVE4826GL075241 BH CO CO 98050472844
11M532 TRAILER IN 86 KTY 1KKVE4828GL075242 BH CO CO 98050472855
11M533 TRAILER IN 86 KTY 1KKVE482XGL075243 BH CO CO 98050472863
11M535 TRAILER IN 86 KTY 1KKVE4823GL075245 BH CO CO 98050472882
11M536 TRAILER IN 86 KTY 1KKVE4825GL075246 BH CO CO 98050472893
11M538 TRAILER IN 86 KTY 1KKVE4829GL075248 BH CO CO 98050472905
11M541 TRAILER IN 86 KTY 1KKVE4829GL075251 BH CO CO 98050472918
11M543 TRAILER IN 86 KTY 1KKVE4822GL075253 BH CO CO 98050472929
11M544 TRAILER IN 86 KTY 1KKVE4824GL075254 BH CO CO 98050472940
11M546 TRAILER IN 86 KTY 1KKVE4828GL075256 BH CO CO 98050472949
11M547 TRAILER IN 86 KTY 1KKVE482XGL075257 BH CO CO 98050472958
11M548 TRAILER IN 86 KTY 1KKVE4821GL075258 BH CO CO 98050472964
11M549 TRAILER IN 86 KTY 1KKVE4823GL075259 BH CO CO 98050472977
11M553 TRAILER IN 86 KTY 1KKVE4825GL075263 BH CO CO 98050472986
11M555 TRAILER IN 86 KTY 1KKVE4829GL075265 BH CO CO 98050473011
11M558 TRAILER IN 86 KTY 1KKVE4824GL075268 BH CO CO 98050473024
11M559 TRAILER IN 86 KTY 1KKVE4826GL075269 BH CO CO 98050472180
11M561 TRAILER IN 86 KTY 1KKVE4824GL075271 BH CO CO 98050472191
11M562 TRAILER IN 86 KTY 1KKVE4826GL075272 BH CO CO 98050472199
11M566 TRAILER IN 86 KTY 1KKVE4823GL075276 BH CO CO 98050472217
11M570 TRAILER IN 86 KTY 1KKVE4825GL075280 BH CO CO 98050472236
11M573 TRAILER IN 86 KTY 1KKVE4820GL075283 BH CO CO 98050472243
11M574 TRAILER IN 86 KTY 1KKVE4822GL075284 BH CO CO 98050472254
11M577 TRAILER IN 86 KTY 1KKVE4828GL075287 RS CO CO 98050472262
11M578 TRAILER IN 86 KTY 1KKVE482XGL075288 BH CO CO 98050472268
11M581 TRAILER IN 86 KTY 1KKVE482XGL075291 BH CO CO 98050472274
11M585 TRAILER IN 86 KTY 1KKVE4827GL075295 RS CO CO 98050472282
11M586 TRAILER IN 86 KTY 1KKVE4829GL075296 BH CO CO 98050472290
11M587 TRAILER IN 86 KTY 1KKVE4820GL075297 BH CO CO 98050472296
11M590 TRAILER IN 86 KTY 1KKVE4827GL075300 BH CO CO 98050472304
11M594 TRAILER IN 86 KTY 1KKVE4824GL075304 BH CO CO 98050472315
11M600 TRAILER IN 86 KTY 1KKVE482XGL075310 BH CO CO 98050472324
11M601 TRAILER IN 86 KTY 1KKVE4821GL075311 BH CO CO 98050472342
11M604 TRAILER IN 86 KTY 1KKVE4827GL075314 BH CO CO 98050472351
11M605 TRAILER IN 86 KTY 1KKVE4829GL075315 BH CO CO 98050472364
11M606 TRAILER IN 86 KTY 1KKVE4820GL075316 BH CO CO 98050472375
11M607 TRAILER IN 86 KTY 1KKVE4822GL075317 BH CO CO 98050472383
11M610 TRAILER IN 86 KTY 1KKVE4822GL075320 BH CO CO 98050472393
11M618 TRAILER IN 86 KTY 1KKVE4827GL075328 HV CO CO 98050472401
11M619 TRAILER IN 86 KTY 1KKVE4829GL075329 BH CO CO 98050472414
11M620 TRAILER IN 86 KTY 1KKVE4825GL075330 BH CO CO 98050472420
11M634 TRAILER IN 86 KTY 1KKVE4825GL075344 BH CO CO 98050472437
11M641 TRAILER IN 86 KTY 1KKVE4822GL075351 BH CO CO 98050472444
</TABLE>
<PAGE>
Page 33
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11M649 TRAILER IN 86 KTY 1KKVE4827GL075359 BH CO CO 98050472463
11M650 TRAILER IN 86 KTY 1KKVE4823GLO75360 BH CO CO 98050472472
11M651 TRAILER IN 86 KTY 1KKVE4825GL075361 BH CO CO 98050472481
11M652 TRAILER IN 86 KTY 1KKVE4827GL075362 BH CO CO 98050472485
11M653 TRAILER IN 86 KTY 1KKVE4829GL075363 BH CO CO 98050472492
11M656 TRAILER IN 86 KTY 1KKVE4824GL075366 BH CO CO 98050472500
11M666 TRAILER IN 86 KTY 1KKVE4827GL075376 BH CO CO 98050472508
11M667 TRAILER IN 86 KTY 1KKVE4829GL075377 BH CO CO 98050472515
11M669 TRAILER IN 86 KTY 1KKVE4822GL075379 RS CO CO 98050472527
11M674 TRAILER IN 86 KTY 1KKVE4826GL075384 BH CO CO 98050472554
11M682 TRAILER IN 86 KTY 1KKVE4825GL075392 BH CO CO 98050472564
11M683 TRAILER IN 86 KTY 1KKVE4827GL075393 BH CO CO 98050472572
11M685 TRAILER IN 86 KTY 1KKVE4820GL075395 BH CO CO 98050472581
11M686 TRAILER IN 86 KTY 1KKVE4822GL075396 BH CO CO 98050472590
11M687 TRAILER IN 86 KTY 1KKVE4824GL075397 HV DC D4 98050472599
11M688 TRAILER IN 86 KTY 1KKVE4826GL075398 BH CO CO 98050472607
11M689 TRAILER IN 86 KTY 1KKVE4828GL075399 BH CO CO 98050472617
11M690 TRAILER IN 86 KTY 1KKVE4820GL075400 BH CO CO 98050472635
11M694 TRAILER IN 86 KTY 1KKVE4828GL075404 BH CO CO 98050472419
11M696 TRAILER IN 86 KTY 1KKVE4821GL075406 BH CO CO 98050472428
11M700 TRAILER IN 86 KTY 1KKVE4823GL075410 BH CO CO 98050472433
11M704 TRAILER IN 86 KTY 1KKVE4820GL075414 BH CO CO 98050472441
11M708 TRAILER IN 86 KTY 1KKVE4828GL075418 BH CO CO 98050472448
11M709 TRAILER IN 86 KTY 1KKVE482XGL075419 BH CO CO 98050472455
11M710 TRAILER IN 86 KTY 1KKVE4826GL075420 BH CO CO 98050472462
11M711 TRAILER IN 86 KTY 1KKVE4828GL075421 BH CO CO 98050472468
11M713 TRAILER IN 86 KTY 1KKVE5821GL075423 BH CO CO 98050472477
11M715 TRAILER IN 86 KTY 1KKVE4825GL075425 BH CO CO 98050472483
11M718 TRAILER IN 86 KTY 1KKVE4820GL075428 BH CO CO 98050472489
11M721 TRAILER IN 86 KTY 1KKVE4820GL075431 BH CO CO 98050472494
11M723 TRAILER IN 86 KTY 1KKVE4824GL075433 BH CO CO 98050472504
11M725 TRAILER IN 90 KTY 1KKVA4820LL086080 BH CO CO 98050472510
11M726 TRAILER IN 90 KTY 1KKVA4822LL086081 BH CO CO 98050472519
11M727 TRAILER IN 90 KTY 1KKVA4824LL086082 BH CO CO 98050472525
11M728 TRAILER IN 90 KTY 1KKVA4828LL086084 BH CO CO 98050472534
11M729 TRAILER IN 90 KTY 1KKVA482XLL086085 BH CO CO 98050472544
11M730 TRAILER IN 90 KTY 1KKVA4821LL086086 BH CO CO 98050472552
11M732 TRAILER IN 90 KTY 1KKVA4825LL086088 BH CO CO 98050472561
11M733 TRAILER IN 90 KTY 1KKVA4827LL086089 BH CO CO 98050472569
11M734 TRAILER IN 90 KTY 1KKVA4825LL086091 BH CO CO 98050472578
11M735 TRAILER IN 90 KTY 1KKVA4827LL086092 BH CO CO 98050472587
11M736 TRAILER IN 90 KTY 1KKVA4829LL086093 BH CO CO 98050472595
11M737 TRAILER IN 90 KTY 1KKVA4820LL086094 BH CO CO 98050472605
11M738 TRAILER IN 90 KTY 1KKVA4822LL086095 BH CO CO 98050472611
11M739 TRAILER IN 90 KTY 1KKVA4824LL086096 BH CO CO 98050472619
11M740 TRAILER IN 90 KTY 1KKVA4826LL086097 BH CO CO 98050472627
11M741 TRAILER IN 90 KTY 1KKVA4828LL086098 BH CO CO 98050472634
11M742 TRAILER IN 90 KTY 1KKVA482XLL086099 BH CO CO 98050472645
11M743 TRAILER IN 90 KTY 1KKVA4822LL086100 BH CO CO 98050472650
11M744 TRAILER IN 90 KTY 1KKVA4824LL086101 BH CO CO 98050472659
</TABLE>
<PAGE>
PAGE 34
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11M745 TRAILER IN 90 KTY 1KKVA4826LL086102 BH CO CO 98050472668
11M746 TRAILER IN 90 KTY 1KKVA4828LL086103 BH CO CO 98050472679
11M747 TRAILER IN 90 KTY 1KKVA482XLL086104 BH CO CO 98050472688
11M749 TRAILER IN 90 KTY 1KKVA4823LL086106 BH CO CO 98050472704
11M750 TRAILER IN 90 KTY 1KKVA4825LL086107 BH CO CO 98050472711
11M751 TRAILER IN 90 KTY 1KKVA4827LL086108 BH CO CO 98050472720
11M752 TRAILER IN 90 KTY 1KKVA4829LL086109 BH CO CO 98050472730
11M753 TRAILER IN 90 KTY 1KKVA4825LL086110 BH CO CO 98050472748
11M754 TRAILER IN 90 KTY 1KKVA4827LL086111 BH CO CO 98050472759
11M755 TRAILER IN 90 KTY 1KKVA4826LL086083 RS CO CO 98050472769
11M756 TRAILER IN 90 KTY 1KKVA4823LL086090 BH CO CO 98050472779
11M757 TRAILER IN 90 STK 1S12E9487LE328905 RS CL LA 98050472789
11M758 TRAILER IN 90 STK 1S12E9489LE328906 BH CO CO 98050472800
11M759 TRAILER IN 90 STK 1S12E9480LE328907 BH CO CO 98050472808
11M760 TRAILER IN 90 STK 1S12E9482LE328908 BH CO CO 98050472818
11M761 TRAILER IN 90 STK 1S12E9484LE328909 BH CO CO 98050472826
11M762 TRAILER IN 90 STK 1S12E9480LE328910 BH CO CO 98050472833
11M763 TRAILER IN 90 STK 1S12E9482LE328911 BH CO CO 98050472842
11M764 TRAILER IN 90 STK 1S12E9484LE328912 RS CL LA 98050472523
11M765 TRAILER IN 90 STK 1S12E9486LE328913 BH CO CO 98050472535
11M766 TRAILER IN 90 STK 1S12E9488LE328914 RS CL LA 98050472543
11M768 TRAILER IN 90 STK 1S12E9481LE328916 RS CO CO 98050472557
11M769 TRAILER IN 90 STK 1S12E9483LE328917 RS CL LA 98050472565
11M770 TRAILER IN 90 STK 1S12E9485LE328918 BH CO CO 98050472576
11M771 TRAILER IN 90 STK 1S12E9487LE328919 BH CO CO 98050472585
11M772 TRAILER IN 90 STK 1S12E9483LE328920 BH CO CO 98050472594
11M773 TRAILER IN 90 STK 1S12E9485LE328921 BH CO CO 98050472610
11M774 TRAILER IN 90 STK 1S12E9487LE328922 RS CL LA 98050472620
11M775 TRAILER IN 90 STK 1S12E9489LE328923 BH CO CO 98050472629
11M776 TRAILER IN 90 STK 1S12E9480LE328924 BH CO CO 98050472640
11M777 TRAILER IN 90 STK 1S12E9482LE328925 BH CO CO 98050472648
11M778 TRAILER IN 90 STK 1S12E9484LE328926 BH CO CO 98050472655
11M779 TRAILER IN 90 STK 1S12E9486LE328927 BH CO CO 98050472665
11M780 TRAILER IN 90 STK 1S12E9488LE328928 BH CO CO 98050472675
11M782 TRAILER IN 90 STK 1S12E9486LE328930 BH CO CO 98050472687
11M784 TRAILER IN 90 STK 1S12E948XLE328932 HV CO CO 98050472699
11M785 TRAILER IN 90 STK 1S12E9481LE328933 BH CO CO 98050472709
11M786 TRAILER IN 90 STK 1S12E9483LE328934 BH CO CO 98050472717
11M787 TRAILER IN 90 STK 1S12E9485LE328935 BH CO CO 98050472728
11M788 TRAILER IN 90 STK 1S12E9487LE328936 RS CO CO 98050472741
11M789 TRAILER IN 90 STK 1S12E9489LE328937 BH CO CO 98050472751
11M790 TRAILER IN 90 STK 1S12E9480LE328938 BH CO CO 98050472762
11M791 TRAILER IN 90 STK 1S12E9482LE328939 BH CO CO 98050472774
11M792 TRAILER IN 90 STK 1S12E9489LE328940 BH CO CO 98050472784
11M793 TRAILER IN 90 STK 1S12E9480LE328941 BH CO CO 98050472795
11M794 TRAILER IN 90 STK 1S12E9482LE328942 RS CO CO 98050472805
11M797 TRAILER IN 90 STK 1S12E9488LE328945 BH CO CO 98050472814
11M798 TRAILER IN 90 STK 1S12E948XLE328946 BH CO CO 98050472824
11M799 TRAILER IN 90 STK 1S12E9481LE328947 BH CO CO 98050472834
11M800 TRAILER IN 90 STK 1S12E9483LE328948 BH CO CO 98050472848
</TABLE>
<PAGE>
PAGE 35
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
11M801 TRAILER IN 90 STK 1S12E9485LE328949 BH CO CO 98050472857
11M802 TRAILER IN 90 STK 1S12E9481LE328950 RS CO CO 98050472869
11M803 TRAILER IN 90 STK 1S12E9483LE328951 RS CO CO 98050472878
11M804 TRAILER IN 90 STK 1S1ZE9485LE328952 BH CO CO 98050472885
11M805 TRAILER IN 90 STK 1S12E9487LE328953 BH CO CO 98050472898
11M806 TRAILER IN 90 STK 1S12E9489LE328954 BH CO CO 98050472910
11M808 TRAILER IN 90 STK 1S12E9482LE328956 BH CO CO 98050472917
11M809 TRAILER IN 90 STK 1S12E9484LE328957 RS CL LA 98050472925
11M810 TRAILER IN 90 STK 1S12E9486LE328958 RS CL LA 98050472935
11M811 TRAILER IN 90 STK 1S12E9488LE328959 BH CO CO 98050472944
11M812 TRAILER IN 90 STK 1S12E9484LE328960 BH CO CO 98050472953
11M813 TRAILER IN 90 STK 1S12E9486LE328961 BH CO CO 98050472961
11M814 TRAILER IN 90 STK 1S12E9488LE328962 RS CL LA 98050472967
11M815 TRAILER IN 90 STK 1S12E948XLE328963 RS CL LA 98050472972
11M816 TRAILER IN 90 STK 1S12E9481LE328964 BH CO CO 98050472980
11M817 TRAILER IN 90 STK 1S12E9483LE328965 BH CO CO 98050472984
11M818 TRAILER IN 90 STK 1S12E9485LE328966 BH CO CO 98050472992
11M819 TRAILER IN 90 STK 1S12E9487LE328967 BH CO CO 98050473012
11M820 TRAILER IN 90 STK 1S12E9489LE328968 RS CO CO 98050473080
11M821 TRAILER IN 90 STK 1S12E9480LE328969 BH CO CO 98050473092
11M822 TRAILER IN 90 STK 1S12E9487LE328970 BH CO CO 98050473101
11M825 TRAILER IN 90 STK 1S12E9482LE328973 BH CO CO 98050473114
11M826 TRAILER IN 90 STK 1S12E9484LE328974 BH CO CO 98050473126
11M827 TRAILER IN 90 STK 1S12E9486LE328975 BH CO CO 98050473135
11M829 TRAILER IN 90 STK 1S12E948XLE328977 BH CO CO 98050473144
11M830 TRAILER IN 90 STK 1S12E9481LE328978 BH CO CO 98050473152
11M831 TRAILER IN 90 STK 1S12E9483LE328979 BH CO CO 98050473161
11M833 TRAILER IN 90 STK 1S12E9481LE328981 BH CO CO 98050473170
11M834 TRAILER IN 90 STK 1S12E9483LE328982 RS CL LA 98050473180
11M835 TRAILER IN 90 STK 1S12E9485LE328983 BH CO CO 98050473189
11M836 TRAILER IN 90 STK 1S12E9487LE328984 BH CO CO 98050473201
11M838 TRAILER IN 90 STK 1S12E9480LE328986 BH CO CO 98050473206
11M839 TRAILER IN 90 STK 1S12E9482LE328987 BH CO CO 98050473215
11M841 TRAILER IN 90 STK 1S12E9486LE328989 BH CO CO 98050473224
11M842 TRAILER IN 90 STK 1S12E9482LE328990 BH CO CO 98050473234
11M844 TRAILER IN 90 STK 1S12E9486LE328992 RS CO CO 98050473241
11M845 TRAILER IN 90 STK 1S12E9488LE328993 BH CO CO 98050473245
11M846 TRAILER IN 90 STK 1S12E948XLE328994 BH CO CO 98050473251
11M847 TRAILER IN 90 STK 1S12E9481LE328995 RS CL LA 98050473260
11M850 TRAILER IN 90 STK 1S12E9487LE328998 RS CL LA 98050473269
11M851 TRAILER IN 90 STK 1S12E9489LE328999 BH CO CO 98050473276
11M852 TRAILER IN 90 STK 1S12E948XLE329000 BH CO CO 98050473285
11M853 TRAILER IN 90 STK 1S12E9481LE329001 FD TR TG 98050473293
11M854 TRAILER IN 90 STK 1S12E9483LE329002 RS CL LA 98050473301
11M855 TRAILER IN 90 STK 1S12E9485LE329003 BH CO CO 98050473308
11M856 TRAILER IN 90 STK 1S12E9487LE329004 HV CO CO 98050473312
110004 TRAILER IN 78 KTY 57197 RS CL LA 98050473319
110005 TRAILER IN 78 KTY 57198 RS CO CO 98050473323
110007 TRAILER IN 78 KTY 57200 RS CO CO 98050473330
110013 TRAILER IN 85 KTY 1KKVE4827FL070452 RS CO CO 98050473747
</TABLE>
<PAGE>
PAGE 36
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
110025 TRAILER IN 78 KTY 57366 RS CO CO 98050473749
110026 TRAILER IN 78 KTY 57367 RS CL LA 98050473750
110028 TRAILER IN 78 KTY 57369 RS CO CO 98050473753
110030 TRAILER IN 78 KTY 57371 RS CO CO 98050473756
110033 TRAILER IN 78 KTY 57374 HV CL LA 98050473765
110244 TRAILER IN 79 KTY 56986 RS CO CO 98050473786
110619 TRAILER IN 79 KTY 57762 RS CO CO 98050473788
110624 TRAILER IN 79 KTY 57767 RS CO CO 98050472443
110628 TRAILER IN 79 KTY 57771 RS CO CO 98050472459
110629 TRAILER IN 79 KTY 57772 RS CO CO 98050472476
110632 TRAILER IN 79 KTY 57775 RS CO CO 98050472499
110634 TRAILER IN 79 KTY 57777 RS CO CO 98050472531
110636 TRAILER IN 79 KTY 57779 RS CO CO 98050472549
110637 TRAILER IN 79 KTY 57780 RS CO CO 98050472567
110722 TRAILER IN 79 KTY 58457 RS CO CO 98050472582
110803 TRAILER IN 79 KTY 59428 RS CO CO 98050472598
110807 TRAILER IN 79 KTY 59432 RS CO CO 98050472613
110810 TRAILER IN 79 KTY 59435 RS CO CO 98050472637
110818 TRAILER IN 79 KTY 59443 RS CO CO 98050472652
110973 TRAILER IN 88 KTY 1KKVE4720JL081724 HV CO CO 98050472673
110975 TRAILER IN 88 KTY 1KKVE4722JL081725 HV CO CO 98050472691
110976 TRAILER IN 88 KTY 1KKVE4724JL081726 HV CO CO 98050472707
110977 TRAILER IN 88 KTY 1KKVE4726JL081727 HV CL LA 98050472722
110978 TRAILER IN 88 KTY 1KKVE4728JL081728 HV CO CO 98050472736
110980 TRAILER IN 88 KTY 1KKVE472XJL081729 HV CO CO 98050472747
110981 TRAILER IN 88 KTY 1KKVE4726JL081730 HV CO CO 98050472764
110982 TRAILER IN 88 KTY 1KKVE4728JL081731 HV DC 12 98050472777
110984 TRAILER IN 88 KTY 1KKVE472XJL081732 HV CO CO 98050472788
110989 TRAILER IN 88 KTY 1KKVE4723JL081734 HV CO CO 98050472801
110992 TRAILER IN 88 KTY 1KKVE4727JL081736 HV CO CO 98050472813
110995 TRAILER IN 88 KTY 1KKVE4729JL081737 HV CL LA 98050472828
111000 TRAILER IN 88 KTY 1KKVE4722JL081739 HV CO CO 98050472839
111001 TRAILER IN 88 KTY 1KKVE4729JL081740 HV CO CO 98050472853
111002 TRAILER IN 88 KTY 1KKVE4720JL081741 HV CO CO 98050472862
111003 TRAILER IN 88 KTY 1KKVE4722JL081742 HV CL LA 98050472874
111007 TRAILER IN 88 KTY 1KKVE4728JL081745 HV CO CO 98050472881
111008 TRAILER IN 88 KTY 1KKVE472XJL081746 HV CO CO 98050472891
111009 TRAILER IN 88 KTY 1KKVE4721JL081747 HV CO CO 98050472902
111011 TRAILER IN 88 KTY 1KKVE4723JL081748 HV CO CO 98050472913
111012 TRAILER IN 88 KTY 1KKVE4725JL081749 HV CO CO 98050472927
111014 TRAILER IN 88 KTY 1KKVE4721JL081750 HV CO CO 98050472934
111015 TRAILER IN 88 KTY 1KKVE4723JL081751 HV CO CO 98050472943
111016 TRAILER IN 88 KTY 1KKVE4725JL081752 HV CO CO 98050472951
111018 TRAILER IN 88 KTY 1KKVE4727JL081753 HV CO CO 98050472957
111022 TRAILER IN 88 KTY 1KKVE4729JL081754 HV DC 12 98050472966
111024 TRAILER IN 88 KTY 1KKVE4720JL081755 HV CO CO 98050472976
111025 TRAILER IN 88 KTY 1KKVE4722JL081756 HV CO CO 98050472982
111026 TRAILER IN 88 KTY 1KKVE4724JL081757 HV CO CO 98050472990
111027 TRAILER IN 88 KTY 1KKVE4726JL081758 HV CO CO 98050472998
111030 TRAILER IN 88 KTY 1KKVE4728JL081759 HV CL LA 98050473023
</TABLE>
<PAGE>
PAGE 37
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
111031 TRAILER IN 88 KTY 1KKVE4724JL081760 HV CO CO 98050473031
111036 TRAILER IN 88 KTY 1KKVE4728JL081762 HV CO CO 98050473039
111037 TRAILER IN 88 KTY 1KKVE472XJL081763 HV CO CO 98050473049
111039 TRAILER IN 88 KTY 1KKVE4721JL081764 HV CO CO 98050473059
111043 TRAILER IN 88 KTY 1KKVE4725JL081766 RS CL LA 98050473070
111045 TRAILER IN 88 KTY 1KKVE4727JL081767 HV CO CO 98050472570
111050 TRAILER IN 88 KTY 1KKVE4720JL081769 HV CO CO 98050472591
111051 TRAILER IN 88 KTY 1KKVE4727JL081770 HV CO CO 98050472604
111052 TRAILER IN 88 KTY 1KKVE4729JL081771 HV CO CO 98050472616
111053 TRAILER IN 88 KTY 1KKVE4720JL081772 HV CO CO 98050472633
111055 TRAILER IN 88 KTY 1KKVE4722JL081773 HV CO CO 98050472641
111057 TRAILER IN 88 KTY 1KKVE4724JL081774 HV CO CO 98050472656
111058 TRAILER IN 88 KTY 1KKVE4726JL081775 HV CO CO 98050472667
111059 TRAILER IN 88 KTY 1KKVE4728JL081776 HV CO CO 98050472680
111060 TRAILER IN 88 KTY 1KKVE472XJL081777 HV CO CO 98050472685
111061 TRAILER IN 88 KTY 1KKVE4721JL081778 HV CO CO 98050472696
111062 TRAILER IN 88 KTY 1KKVE4723JL081779 HV CO CO 98050472708
111064 TRAILER IN 88 KTY 1KKVE472XJL081780 HV AG LF 98050472718
111065 TRAILER IN 88 KTY 1KKVE4721JL081781 HV CO CO 98050472731
111067 TRAILER IN 88 KTY 1KKVE4725JL081783 HV CO CO 98050472739
111068 TRAILER IN 88 KTY 1KKVE4727JL081784 HV CO CO 98050472746
111069 TRAILER IN 88 KTY 1KKVE4729JL081785 HV CO CO 98050472757
111070 TRAILER IN 88 KTY 1KKVE4720JL081786 HV CO CO 98050472767
111073 TRAILER IN 88 KTY 1KKVE4724JL081788 HV CO CO 98050472778
111074 TRAILER IN 88 KTY 1KKVE4726JL081789 HV CO CO 98050472787
111075 TRAILER IN 88 KTY 1KKVE4722JL081790 HV CO CO 98050472798
111076 TRAILER IN 88 KTY 1KKVE4724JL081791 HV CO CO 98050472816
111077 TRAILER IN 88 KTY 1KKVE4726JL081792 HV OC 12 98050472825
111079 TRAILER IN 88 KTY 1KKVE4728JL081793 HV CO CO 98050472836
111080 TRAILER IN 88 KTY 1KKVE472XJL081794 HV CO CO 98050472847
111083 TRAILER IN 88 KTY 1KKVE4721JL081795 HV CO CO 98050472856
111084 TRAILER IN 88 KTY 1KKVE4723JL081796 HV CO CO 98050472864
111089 TRAILER IN 88 KTY 1KKVE4729JL081799 HV CL LA 98050472883
111090 TRAILER IN 88 KTY 1KKVE4721JL081800 HV CO CO 98050472892
111092 TRAILER IN 88 KTY 1KKVE4725JL081802 HV CO CO 98050472900
111093 TRAILER IN 88 KTY 1KKVE4727JL081803 HV CO CO 98050472906
111094 TRAILER IN 88 KTY 1KKVE4729JL081804 HV CO CO 98050472915
111095 TRAILER IN 88 KTY 1KKVE4720JL081805 HV CL LA 98050472924
111096 TRAILER IN 88 KTY 1KKVE4722JL081806 HV CO CO 98050472930
111104 TRAILER IN 88 KTY 1KKVE4728JL081809 HV CO CO 98050472960
111105 TRAILER IN 88 KTY 1KKVE4724JL081810 RS CL LA 98050472948
111107 TRAILER IN 88 KTY 1KKVE4728JL081812 HV CO CO 98050472970
111108 TRAILER IN 88 KTY 1KKVE472XJL081813 HV CO CO 98050472978
111109 TRAILER IN 88 KTY 1KKVR4524JL082480 HV OC 12 98050472987
111112 TRAILER IN 88 KTY 1KKVR4526JL082481 HV CO CO 98050472993
111117 TRAILER IN 88 KTY 1KKVR452XJL082483 HV CO CO 98050473030
111119 TRAILER IN 88 KTY 1KKVR4521JL082484 HV CO CO 98050473038
111220 TRAILER IN 88 KTY 1KKVR4523JL082485 HV CO CO 98050473043
111212 TRAILER IN 79 KTY 59731 RS CO CO 98050473062
111213 TRAILER IN 79 KTY 059732 RS CO CO 98050473066
</TABLE>
<PAGE>
PAGE 38
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
111214 TRAILER IN 79 KTY 59733 RS CO CO 98050473073
111215 TRAILER IN 79 KTY 59734 RS CO CO 98050473081
111216 TRAILER IN 79 KTY 59735 RS CO CO 98050473089
111217 TRAILER IN 79 KTY 59736 RS CO CO 98050472501
111218 TRAILER IN 79 KTY 59737 RS CO CO 98050472512
111219 TRAILER IN 79 KTY 59738 RS CO CO 98050472520
111220 TRAILER IN 79 KTY 59739 RS CO CO 98050472524
111224 TRAILER IN 79 KTY 59743 RS CO CO 98050472530
111227 TRAILER IN 79 KTY 59716 RS CL LA 98050472546
111236 TRAILER IN 79 KTY 59725 RS CO CO 98050472560
111242 TRAILER IN 79 KTY 59729 RS CO CO 98050472577
111304 TRAILER IN 85 GTD 1GRDM9629FM104707 RS CL LA 98050472593
111305 TRAILER IN 85 GTD 1GRDM962XFM104702 RS CL LA 98050472602
111306 TRAILER IN 85 GTD 1GRDM9629FM094003 RS CO CO 98050472612
111307 TRAILER IN 85 GTD 1GRDM9620FM104708 RS CO CO 98050472618
111308 TRAILER IN 80 KTY 60158 RS CO CO 98050472625
111309 TRAILER IN 80 KTY 60159 RS CL LA 98050472632
111311 TRAILER IN 80 KTY 60161 RS CL LA 98050472639
111312 TRAILER IN 80 KTY 60162 RS CO CO 98050472647
111313 TRAILER IN 80 KTY 60163 RS CO CO 98050472653
111314 TRAILER IN 85 GTD 1GRDM9625FM094001 RS CL LA 98050472660
111316 TRAILER IN 80 KTY 60165 RS CL LA 98050472669
111318 TRAILER IN 80 KTY 60167 RS CO CO 98050472676
111319 TRAILER IN 80 KTY 60168 RS CL LA 98050472682
111321 TRAILER IN 85 GTD 1GRDM9621FM104703 RS CL LA 98050472698
111327 TRAILER IN 80 KTY 60175 RS CO CO 98050472726
111330 TRAILER IN 80 KTY 60178 RS CO CO 98050472732
111331 TRAILER IN 80 KTY 60179 RS CO CO 98050472742
111332 TRAILER IN 80 KTY 060180 RS CO CO 98050472750
111333 TRAILER IN 80 KTY 60181 RS CO CO 98050473945
111334 TRAILER IN 80 KTY 60182 RS CO CO 98050472766
111335 TRAILER IN 80 KTY 60183 RS CO CO 98050472775
111336 TRAILER IN 80 KTY 60184 RS CO CO 98050472786
111337 TRAILER IN 80 KTY 60185 RS CO CO 98050472793
111338 TRAILER IN 80 KTY 60186 RS CO CO 98050472796
111340 TRAILER IN 85 GTD 1GRDM9627FM094002 RS CL LA 98050472807
111341 TRAILER IN 80 KTY 60188 RS CO CO 98050472817
111342 TRAILER IN 80 KTY 60189 RS CL LA 98050472822
111343 TRAILER IN 80 KTY 60190 RS CO CO 98050472829
111344 TRAILER IN 85 GTD 1GRDM9623FM104704 RS CL LA 98050472838
111346 TRAILER IN 80 KTY 60191 RS CO CO 98050472846
111349 TRAILER IN 80 KTY 60194 RS CO CO 98050472852
111350 TRAILER IN 80 KTY 60195 RS CO CO 98050472859
111351 TRAILER IN 80 KTY 60196 RS CO CO 98050472866
111352 TRAILER IN 80 KTY 60197 RS CO CO 98050472871
111353 TRAILER IN 80 KTY 60198 RS CO CO 98050472094
111355 TRAILER IN 80 KTY 60200 RS CO CO 98050472099
111356 TRAILER IN 80 KTY 60201 RS CL LA 98050472104
111358 TRAILER IN 80 KTY 60203 FD TR TG 98050472110
111360 TRAILER IN 80 KTY 60205 RS CO CO 98050472116
</TABLE>
<PAGE>
PAGE 39
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ------ ------- -------- -------- ---- --------------------- -------- -------- --- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
111361 TRAILER IN 80 KTY 60206 RS CO CO 98050472121
111362 TRAILER IN 80 KTY 60207 RS CO CO 98050472127
111394 TRAILER IN 85 GTO 1GRDM9628FM104701 RS CO CO 98050472334
111973 TRAILER IN 85 STM 2S9FV4825FB015004 HV CO CO 98050472346
111978 TRAILER IN 85 STM 2S9FV4822F8015008 FD TR TG 98050472355
111981 TRAILER IN 68 KTY 35654 FS SL TP 98050472369
111987 TRAILER IN 86 MON 2M9V72438G1005167 FD TR TG 98050472363
111988 TRAILER IN 86 MON 2M9V72431G1005110 FD TR TG 98050472377
111990 TRAILER IN 85 STM 2S9FV4821FB015002 HV CO CO 98050472382
111991 TRAILER IN 85 STM 2S9FV4824FB015009 FD TR TG 98050472390
112011 TRAILER IN 86 MON 2M9V72431G1005107 FD TR TG 98050142079
112012 TRAILER IN 85 MON 2M9V72437F1005157 FD TR TG 98050472403
112477 TRAILER IN 70 KTY 38271 RS CL LA 98050472411
112484 TRAILER IN 70 KTY 38278 FD TR LD 98050472417
112520 TRAILER IN 70 KTY 38314 RS CO CO 98050472445
112836 TRAILER IN 80 KTY 61044 RS CO CO 98050472276
112837 TRAILER IN 80 KTY 61045 RS CO CO 98050472460
112856 TRAILER IN 80 KTY 61050 RS CO CO 98050472482
112859 TRAILER IN 80 KTY 61053 RS CO CO 98050472488
112860 TRAILER IN 80 KTY 61054 RS CO CO 98050472491
112863 TRAILER IN 80 KTY 61057 RS CO CO 98050472497
112872 TRAILER IN 80 KTY 61062 RS CO CO 98050472529
112875 TRAILER IN 80 KTY 61064 RS CO CO 98050472536
112893 TRAILER IN 80 KTY 61071 RS CO CO 98050472548
112900 TRAILER IN 80 KTY 61072 RS CO CO 98050472553
112902 TRAILER IN 80 KTY 61073 RS CO CO 98050472559
112903 TRAILER IN 80 KTY 61074 RS CL LA 98050472566
112914 TRAILER IN 80 KTY 61079 RS CO CO 98050472575
112918 TRAILER IN 80 KTY 61082 RS CL LA 98050472615
112921 TRAILER IN 80 KTY 61084 RS CO CO 98050472588
112925 TRAILER IN 80 KTY 61087 RS CO CO 80184045055
112927 TRAILER IN 80 KTY 61089 RS CO CO 98050472601
112929 TRAILER IN 80 KTY 61090 RS CL LA 98050472606
112931 TRAILER IN 80 KTY 61092 RS CO CO 98050472626
112932 TRAILER IN 80 KTY 61093 RS CL LA 98050472630
112933 TRAILER IN 80 KTY 61094 RS CL LA 98050472638
112943 TRAILER IN 80 KTY 61100 RS CL LA 98050472644
112944 TRAILER IN 80 KTY 61101 RS CO CO 98050472661
112948 TRAILER IN 80 KTY 61104 RS CO CO 98050472651
112965 TRAILER IN 80 KTY 61109 RS CO CO 98050472670
112970 TRAILER IN 80 KTY 61113 RS CO CO 98050472677
112972 TRAILER IN 80 KTY 61114 RS CL LA 98050472684
112973 TRAILER IN 80 KTY 61115 RS CO CO 98050472689
112974 TRAILER IN 80 KTY 61116 RS CO CO 98050472694
112975 TRAILER IN 80 KTY 61117 RS CL LA 98050472700
112976 TRAILER IN 80 KTY 61118 RS CL LA 98050472706
112979 TRAILER IN 80 KTY 61120 RS CO CO 98050472712
112981 TRAILER IN 80 KTY 61122 RS CO CO 98050472719
112982 TRAILER IN 80 KTY 61123 RS CO CO 98050472724
119284 TRAILER IN 80 KTY 61124 RS CO CO 98050472733
</TABLE>
<PAGE>
PAGE 40
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ------ ------- -------- -------- ---- --------------------- -------- -------- --- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
112991 TRAILER IN 80 KTY 61127 RS CO CO 98050472737
112992 TRAILER IN 80 KTY 61128 RS CO CO 98050472745
112993 TRAILER IN 80 KTY 61129 RS CO CO 98050472752
112995 TRAILER IN 80 KTY 61130 RS CL LA 98050472758
113002 TRAILER IN 80 KTY 61133 RS CO CO 98050472765
113003 TRAILER IN 80 KTY 61134 RS CO CO 98050472770
113009 TRAILER IN 80 KTY 61136 RS CL LA 98050472776
113016 TRAILER IN 80 KTY 61139 RS CL LA 98050472782
113017 TRAILER IN 80 KTY 61140 RS CL LA 98050472792
113018 TRAILER IN 80 KTY 61141 RS CL LA 98050472797
113021 TRAILER IN 80 KTY 61144 RS CL LA 98050472809
113028 TRAILER IN 80 KTY 61148 RS CO CO 98050472815
113031 TRAILER IN 80 KTY 61151 RS CL LA 98050472821
113033 TRAILER IN 80 KTY 61152 RS CL LA 98050472827
113035 TRAILER IN 80 KTY 61153 RS CO CO 98050472831
113038 TRAILER IN 80 KTY 61154 HV DC 02 98050472840
113068 TRAILER IN 80 KTY 61161 RS CL LA 98050472845
113167 TRAILER IN 86 MON 2M9V72438G1005170 FD TR TG 98050472867
113169 TRAILER IN 86 MON 2M9V72438G1005220 FD TR TG 98050472880
113172 TRAILER IN 86 MON 2M9V72435G1005109 FD TR TG 98050472901
113174 TRAILER IN 85 MON 2M9V72435F1005111 FD TR TG 98050472914
113245 TRAILER IN 72 KTY 43362 FS SL TP 98050472941
113316 TRAILER IN 85 STM 2S9FV4828FB015224 RS CO CO 98050472985
113451 TRAILER IN 80 KTY 61174 RS CL LA 98050472991
113470 TRAILER IN 80 KTY 61742 RS CO CO 98050472999
113500 TRAILER IN 80 KTY 61755 FD TR TG 98050473017
114087 TRAILER IN 93 KTY 1KKVE4822PL094451 RS CO CO 98050473042
114088 TRAILER IN 93 KTY 1KKVE4824PL094452 RS CO CO 98050473044
114090 TRAILER IN 93 KTY 1KKVE4826PL094453 RS CO CO 98050473050
114362 TRAILER IN 81 KTY 1KKVR3021BL001552 HV CO CO 98050473063
114391 TRAILER IN 81 KTY 1KKVE4226BL000671 RS CO CO 98050473071
114438 TRAILER IN 81 KTY 1KKVE4521BL000766 RS CO CO 98050473106
114439 TRAILER IN 81 KTY 1KKVE4523BL000767 RS CL LA 98050473111
114442 TRAILER IN 81 KTY 1KKVE4529BL000773 RS CO CO 98050473119
114443 TRAILER IN 81 KTY 1KKVE4520BL000774 RS CO CO 98050473124
114515 TRAILER IN 93 FRU 1H2V0281XPB013004 HV DC 09 98050473133
114517 TRAILER IN 93 FRU 1H2V02816PB013002 HV DC 09 98050473138
114518 TRAILER IN 93 FRU 1H2V02814PB013001 HV DC 09 98050473142
114523 TRAILER IN 93 FRU 1H2V02818PB013003 HV DC 08 98050473146
114679 TRAILER IN 94 KTY 1KKVE281XRL098715 HV CO CO 98050473153
114680 TRAILER IN 94 KTY 1KKVE2811RL098716 HV CO CO 98050473156
114723 TRAILER IN 81 KTY 1KKVE4227BL001571 RS CL LA 98050473163
114729 TRAILER IN 81 KTY 1KKVE4228BL001577 RS CL LA 98050473168
114739 TRAILER IN 81 KTY 1KKVE4527BL001596 HV CO CO 98050473174
114771 TRAILER IN 82 KTY 1KKVE4528CL000118 RS CO CO 98050473176
114773 TRAILER IN 82 KTY 1KKVE4528CL000121 RS CO CO 98050473183
114774 TRAILER IN 82 KTY 1KKVE4523CL000124 RS CO CO 98050473186
114776 TRAILER IN 82 KTY 1KKVE4525CL000125 RS CO CO 98050473193
114787 TRAILER IN 82 KTY 1KKVE4524CL000133 RS CO CO 98050473197
114798 TRAILER IN 82 KTY 1KKVE4523CL000138 RS CO CO 98050473202
</TABLE>
<PAGE>
PAGE 41
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ------ ------- -------- -------- ---- --------------------- -------- -------- --- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
114807 TRAILER IN 82 KTY 1KKVE4521CL000140 RS CO CO 98050473209
114813 TRAILER IN 82 KTY 1KKVE4527CL000143 FD TR LD 98050473217
114814 TRAILER IN 82 KTY 1KKVE4529CL000144 RS CO CO 98050473223
114817 TRAILER IN 82 KTY 1KKVE4524CL000147 RS CO CO 98050473227
114819 TRAILER IN 82 KTY 1KKVE4528CL000149 RS CO CO 98050473231
114822 TRAILER IN 82 KTY 1KKVE4528CL000152 RS CO CO 98050473237
115182 TRAILER IN 82 KTY 1KKVE4529CL000306 HV CO CO 98050473246
115186 TRAILER IN 73 KTY 045186 RS CO CO 98050473252
115447 TRAILER IN 82 KTY 1KKVE4522CL000387 RS CL LA 98050473087
115453 TRAILER IN 82 KTY 1KKVE4522CL000390 RS CO CO 98050473097
115457 TRAILER IN 82 KTY 1KKVE4524CL000391 RS CL LA 98050473104
115462 TRAILER IN 82 KTY 1KKVE4528CL000393 RS CO CO 98050473113
115466 TRAILER IN 82 KTY 1KKVE452XCL000394 RS CO CO 98050473123
115467 TRAILER IN 82 KTY 1KKVE4521CL000395 RS CO CO 98050473137
115472 TRAILER IN 82 KTY 1KKVE4529CL000399 RS CO CO 98050473259
115475 TRAILER IN 82 KTY 1KKVE4523CL000401 RS CO CO 98050473264
115477 TRAILER IN 82 KTY 1KKVE4527CL000403 RS CO CO 98050473270
115478 TRAILER IN 82 KTY 1KKVE4520CL000405 RS CO CO 98050473279
115479 TRAILER IN 82 KTY 1KKVE4522CL000406 RS CO CO 98050473282
115482 TRAILER IN 82 KTY 1KKVE4526CL000408 RS CL LA 98050473288
115487 TRAILER IN 82 KTY 1KKVE4524CL000410 RS CO CO 98050473278
115490 TRAILER IN 82 KTY 1KKVE4528CL000412 RS CO CO 98050473286
115496 TRAILER IN 82 KTY 1KKVE4521CL000414 RS CL LA 98050473297
115498 TRAILER IN 82 KTY 1KKVE4525CL000416 RS CO CO 98050473298
115499 TRAILER IN 82 KTY 1KKVE4527CL000417 RS CL LA 98050473303
115500 TRAILER IN 82 KTY 1KKVE4529CL000418 RS CL LA 98050473306
115501 TRAILER IN 82 KTY 1KKVE4520CL000419 RS CO CO 98050473313
115502 TRAILER IN 82 KTY 1KKVE4527CL000420 RS CO CO 98050473764
115503 TRAILER IN 82 KTY 1KKVE4529CL000421 RS CL LA 98050473768
115504 TRAILER IN 82 KTY 1KKVE4520CL000422 RS CO CO 98050473771
115505 TRAILER IN 82 KTY 1KKVE4522CL000423 RS CO CO 98050473774
115510 TRAILER IN 82 KTY 1KKVE4526CL000425 RS CO CO 98050473776
115529 TRAILER IN 82 KTY 1KKVE452XCL000430 RS CO CO 98050473782
115534 TRAILER IN 82 KTY 1KKVE4521CL000431 RS CO CO 98050473852
115536 TRAILER IN 82 KTY 1KKVE4523CL000432 RS CL LA 98050473853
115537 TRAILER IN 82 KTY 1KKVE4525CL000433 RS CO CO 98050473855
115540 TRAILER IN 82 KTY 1KKVE4520CL000436 RS CO CO 98050473856
115542 TRAILER IN 82 KTY 1KKVE4524CL000438 RS CO CO 98050473858
115543 TRAILER IN 82 KTY 1KKVE4526CL000439 RS CO CO 98050473859
115545 TRAILER IN 82 KTY 1KKVE4524CL000441 RS CO CO 98050473861
115547 TRAILER IN 82 KTY 1KKVE4528CL000443 RS CL LA 98050473863
115549 TRAILER IN 82 KTY 1KKVE4521CL000445 RS CO CO 98050473865
115550 TRAILER IN 82 KTY 1KKVE4523CL000446 RS CO CO 98050142082
115552 TRAILER IN 82 KTY 1KKVE4527CL000448 RS CO CO 98050473866
115553 TRAILER IN 82 KTY 1KKVE2620CL000651 MV CO CO 98050473868
115831 TRAILER IN 73 KTY 46247 RS CL LA 98050473870
115923 TRAILER IN 82 KTY 1KKVE452XCL001142 RS CO CO 98050473871
115926 TRAILER IN 82 KTY 1KKVE4521CL001143 RS CO CO 98050473872
115927 TRAILER IN 82 KTY 1KKVE4523CL001144 RS CO CO 98050473873
115928 TRAILER IN 82 KTY 1KKVE4525CL001145 RS CL LA 98050473874
</TABLE>
<PAGE>
PAGE 42
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ------ ------- -------- -------- ---- --------------------- -------- -------- --- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
115929 TRAILER IN 82 KTY 1KKVE4529CL001147 RS CO CO 98050473875
115934 TRAILER IN 82 KTY 1KKVE4522CL001152 RS CO CO 98050473876
115935 TRAILER IN 82 KTY 1KKVE4528CL001155 RS CO CO 98050473877
115945 TRAILER IN 82 KTY 1KKVE4521CL001157 RS CO CO 98050473878
115950 TRAILER IN 82 KTY 1KKVE4523CL001158 RS CO CO 98050473879
115954 TRAILER IN 82 KTY 1KKVE4525CL001162 RS CO CO 98050473880
115960 TRAILER IN 82 KTY 1KKVE4529CL001164 RS CO CO 98050473881
115963 TRAILER IN 82 KTY 1KKVE4520CL001165 RS CO CO 98050473882
115964 TRAILER IN 82 KTY 1KKVE4522CL001166 RS CO CO 98050473150
115966 TRAILER IN 82 KTY 1KKVE4524CL001170 RS CO CO 98050473158
115967 TRAILER IN 82 KTY 1KKVE4526CL001171 RS CO CO 98050473167
115969 TRAILER IN 82 KTY 1KKVE452XCL001173 RS CO CO 98050473182
115971 TRAILER IN 82 KTY 1KKVE4523CL001175 RS CO CO 98050473200
115972 TRAILER IN 82 KTY 1KKVE4529CL001178 RS CO CO 98050473210
115973 TRAILER IN 82 KTY 1KKVE4520CL001179 RS CO CO 98050473222
115979 TRAILER IN 82 KTY 1KKVE4520CL001182 RS CO CO 98050473232
115980 TRAILER IN 82 KTY 1KKVE4522CL001183 RS CO CO 98050473250
115981 TRAILER IN 82 KTY 1KKVE4528CL001186 RS CO CO 98050473277
115982 TRAILER IN 82 KTY 1KKVE452XCL001187 RS CO CO 98050473295
115985 TRAILER IN 82 KTY 1KKVE452XCL001190 RS CO CO 98050473694
115987 TRAILER IN 82 KTY 1KKVE4521CL001191 RS CO CO 98050473696
115989 TRAILER IN 82 KTY 1KKVE4529CL001195 RS CL LA 98050473698
115992 TRAILER IN 82 KTY 1KKVE4520CL001196 RS CL LA 98050473700
115993 TRAILER IN 82 KTY 1KKVE4522CL001197 RS CO CO 98050473702
115998 TRAILER IN 82 KTY 1KKVE4527CL001258 RS CO CO 98050473703
116130 TRAILER IN 83 KTY 1KKVR4526DL000091 HV CO CO 98050473709
116182 TRAILER IN 74 KTY 48439 RS CO CO 98050473711
116232 TRAILER IN 83 KTY 1KKVE2628DL000267 HV CO CO 98050473713
116233 TRAILER IN 83 KTY 1KKVE4528DL000265 HV CO CO 98050473714
116234 TRAILER IN 83 KTY 1KKVE452XDL000266 HV CL LA 98050473752
116435 TRAILER IN 74 KTY 48508 RS CO CO 98050473761
116548 TRAILER IN 97 STK 1S12E9539VE421284 HV CO CO 98050473716
116549 TRAILER IN 97 STK 1S12E9530VE421285 HV CO CO 98050473717
116550 TRAILER IN 97 STK 1S12E9532VE421286 HV CO CO 98050473718
116551 TRAILER IN 97 STK 1S12E9534VE421287 HV CO CO 98050473719
116552 TRAILER IN 97 STK 1S12E9536VE421288 HV CO CO 98050473720
116553 TRAILER IN 97 STK 1S12E9538VE421289 HV CO CO 98050473723
116554 TRAILER IN 97 STK 1S12E9534VE421290 HV CO CO 98050473725
116555 TRAILER IN 97 STK 1S12E9536VE421291 HV CO CO 98050473727
116556 TRAILER IN 97 STK 1S12E9538VE421292 HV CO CO 98050473729
116557 TRAILER IN 97 STK 1S12E953XVE421293 HV CO CO 98050473731
116558 TRAILER IN 97 STK 1S12E9531VE421294 HV CO CO 98050473733
116559 TRAILER IN 97 STK 1S12E9533VE421295 HV CO CO 98050473735
116560 TRAILER IN 97 STK 1S12E9535VE421296 HV CO CO 98050473737
116561 TRAILER IN 97 STK 1S12E9537VE421297 HV CO CO 98050473739
116562 TRAILER IN 97 STK 1S12E9539VE421298 HV CO CO 98050473741
116563 TRAILER IN 97 STK 1S12E9530VE421299 HV CO CO 98050473743
116564 TRAILER IN 97 STK 1S12E9533VE421300 HV CO CO 98050473746
116565 TRAILER IN 97 STK 1S12E9535VE421301 HV CO CO 98050473748
116566 TRAILER IN 97 STK 1S12E9537VE421302 HV CO CO 98050473751
</TABLE>
<PAGE>
PAGE 43
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ------ ------- -------- -------- ---- --------------------- -------- -------- --- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
116569 TRAILER IN 97 STK 1S12E9539VE421303 HV CO CO 98050473754
116570 TRAILER IN 97 STK 1S12E9530VE421304 HV CO CO 98050473757
116571 TRAILER IN 97 STK 1S12E9532VE421305 HV CO CO 98050472806
116572 TRAILER IN 97 STK 1S12E9534VE421306 HV CO CO 98050472837
116573 TRAILER IN 97 STK 1S12E9536VE421307 HV CO CO 98050472858
116574 TRAILER IN 97 STK 1512E9538VE421308 HV CO CO 98050472872
116589 TRAILER IN 97 KTY 1KKVE5027VL109895 RS CO CO 98050472890
116590 TRAILER IN 97 KTY 1KKVE5029VL109896 RS CL LA 98050472904
116591 TRAILER IN 97 KTY 1KKVE5020VL109897 RS CO CO 98050472922
116592 TRAILER IN 97 KTY 1KKVE5022VL109898 RS CO CO 98050472932
116600 TRAILER IN 97 KTY 1KKVE5027VL110061 RS CL LA 98050472947
116602 TRAILER IN 97 KTY 1KKVE5020VL110063 RS CO CO 98050472965
116603 TRAILER IN 97 KTY 1KKVE5022VL110064 RS CO CO 98050472973
116605 TRAILER IN 97 KTY 1KKVE5026VL110066 RS CL LA 98050472994
116606 TRAILER IN 97 KTY 1KKVE5028VL110067 RS CO CO 98050473018
116607 TRAILER IN 97 KTY 1KKVE502XVL110068 RS CO CO 98050473026
116608 TRAILER IN 97 KTY 1KKVE5021VL110069 RS CO CO 98050473037
116609 TRAILER IN 97 KTY 1KKVE5028VL110070 RS CO CO 98050473048
116610 TRAILER IN 97 KTY 1KKVE502XVL110071 RS CO CO 98050473058
116702 TRAILER IN 97 KTY 1KKVE4825VL110042 RS CO CO 98050473134
116703 TRAILER IN 97 KTY 1KKVE5025VL110043 RS CO CO 98050473147
116704 TRAILER IN 97 KTY 1KKVE5027VL110044 RS CO CO 98050473160
116705 TRAILER IN 97 KTY 1KKVE5029VL110045 RS CO CO 98050473175
116706 TRAILER IN 97 KTY 1KKVE5020VL110046 RS CO CO 98050473185
116707 TRAILER IN 97 KTY 1KKVE5022VL110047 RS CO CO 98050473194
116737 TRAILER IN 97 DOR 1DTV51220VA262220 RS CL LA 98050473208
116738 TRAILER IN 97 DOR 1DTV51222VA262221 RS CL LA 98050473218
116739 TRAILER IN 97 DOR 1DTV51224VA262222 RS CL LA 98050473229
116740 TRAILER IN 97 DOR 1DTV51226VA262223 RS CL LA 98050473238
116741 TRAILER IN 97 DOR 1DTV51228VA262224 RS CL LA 98050473256
116752 TRAILER IN 97 KTY 1KKVE5237VL110048 RS CO CO 98050473273
116815 TRAILER IN 75 KTY 048554 RS CO CO 98050473355
116837 TRAILER IN 75 KTY 048576 RS CO CO 98050473360
117325 TRAILER IN 84 KTY 1KKVE4526EL069733 RS CL LA 98050473363
117327 TRAILER IN 84 KTY 1KKVE452XEL069735 RS CO CO 98050473367
117329 TRAILER IN 84 KTY 1KKVE4523EL069737 RS CO CO 98050473368
117330 TRAILER IN 84 KTY 1KKVE4525EL069738 RS CO CO 98050473373
117331 TRAILER IN 84 KTY 1KKVE4527EL069739 RS CO CO 98050473375
117332 TRAILER IN 84 KTY 1KKVE4523EL069740 RS CL LA 98050473377
117333 TRAILER IN 84 KTY 1KKVE4525EL069741 RS CO CO 98050473381
117334 TRAILER IN 84 KTY 1KKVE4527EL069742 RS CO CO 98050473385
117335 TRAILER IN 84 KTY 1KKVE4529EL069743 RS CO CO 98050473386
117336 TRAILER IN 84 KTY 1KKVE4520EL069744 RS CO CO 98050473391
117337 TRAILER IN 84 KTY 1KKVE4522EL069745 RS CO CO 98050473473
117338 TRAILER IN 84 KTY 1KKVE4524EL069746 RS CO CO 98050473475
117339 TRAILER IN 84 KTY 1KKVE4526EL069747 RS CO CO 98050473476
117340 TRAILER IN 84 KTY 1KKVE4528EL069748 RS CO CO 98050473478
117341 TRAILER IN 84 KTY 1KKVE452XEL069749 RS CO CO 98050473479
117342 TRAILER IN 84 KTY 1KKVE4526EL069750 RS CO CO 98050473480
117346 TRAILER IN 84 KTY 1KKVE452XEL069752 RS CO CO 98050473483
</TABLE>
<PAGE>
PAGE 44
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
117348 TRAILER IN 84 KTY 1KKVE4521EL069753 RS CO CO 98050473485
117353 TRAILER IN 84 KTY 1KKVE4525EL069755 RS CO CO 84184066086
117354 TRAILER IN 84 KTY 1KKVE4527EL069756 RS CO CO 98050473488
117420 TRAILER IN 84 KTY 1KKVE4523EL069589 RS CO CO 98050473518
117421 TRAILER IN 84 KTY 1KKVE452XEL069590 RS CO CO 98050473520
119275 TRAILER IN 85 KTY 1KKVE3014FL073161 HV CO CO 98050473985
119602 TRAILER IN 85 KTY 1KKVE482XFL072681 RS CO CO 98184617003
119616 TRAILER IN 85 KTY 1KKVE4526FL074271 HV CO CO 98050473986
12A025 TRAILER IN 82 KTY 1KKVE4822CL001812 HV CO CO 98050473521
12A079 TRAILER IN 82 KTY 1KKVE4824CL001875 HV CO CO 98050473525
12A097 TRAILER IN 82 KTY 1KKVE4823CL001897 HV CO CO 98050473528
12A348 TRAILER IN 83 KTY 1KKVE4826DL000115 HV CO AD 98050473529
12F763 TRAILER IN 86 DOR 10TV11X22GH023228 FD TR TG 98050473965
12K416 TRAILER IN 83 GTD 1GRFC9627DB115337 RS CO C0 98050473531
12K424 TRAILER IN 84 TMO 1PT02AAH1E9004985 FD TR TG 98050473533
12K426 TRAILER IN 84 TMO 1PT02AAHXE9004998 FD TR TG 98050473536
12K432 TRAILER IN 84 TMO 1PT02AAH6E9004996 RS CO CO 98050473537
12V146 TRAILER IN 93 STN 1DW1A5325PS793445 HV DC 01 98050473540
12V178 TRAILER IN 93 STN 1DW1A5327PS793477 HV DC 01 98050473543
12V289 TRAILER IN 93 STN 1DW1A5325PS793588 HV DC 01 98050473545
12V501 TRAILER IN 92 STK 1S12E9536ND349661 HV DC 01 98050473548
120102 TRAILER IN 79 KTY 57570 BH CO CO 98050473549
121662 TRAILER IN 80 KTY 060285 BH CO CO 98050473552
122226 TRAILER IN 69 KTY 036923 FS SL SI 98050473555
122229 TRAILER IN 69 KTY 036926 FS SL SI 98050473557
122424 TRAILER IN 70 KTY 038209 FS SL TP 98050473559
122661 TRAILER IN 71 KTY 041458 FS SL SI 98050473561
123219 TRAILER IN 72 KTY 043119 BH CO CO 98050473564
123909 TRAILER IN 80 KTY 061869 BH CO CO 98050473567
124233 TRAILER IN 81 KTY 1KKVE452XBL000510 BH CO CO 98050473569
124847 TRAILER IN 82 KTY 1KKVE4529CL000046 HV CO CO 98050473572
124990 TRAILER IN 82 KTY 1KKVE452XCL000251 HV CO CO 98050473575
125001 TRAILER IN 82 KTY 1KKVE4526CL000263 BH CO CO 98050473578
125121 TRAILER IN 82 KTY 1KKVE4529CL001388 BH CO CO 98050473581
125415 TRAILER IN 73 KTY 045415 RS CL LA 98050473583
125803 TRAILER IN 73 KTY 046219 RS CL LA 98050473586
126320 TRAILER IN 74 KTY 048659 RS CO CO 98050473589
126520 TRAILER IN 74 KTY 048788 RS CL LA 98050473591
126742 TRAILER IN 75 KTY 048973 RS CO CO 98050473394
13K131 TRAILER IN 87 KTY 1KKVF4822HL079186 RS CO CO 98050473601
13K132 TRAILER IN 87 KTY 1KKVF4824HL079187 RS CO CO 98050473603
13K133 TRAILER IN 87 KTY 1KKVF4826HL079188 RS AG LF 98050473605
13K134 TRAILER IN 87 KTY 1KKVF4828HL079189 RS CL LA 98050473610
13K135 TRAILER IN 87 KTY 1KKVF4824HL079190 RS CO CO 98050473611
13K136 TRAILER IN 87 KTY 1KKVF4826HL079191 RS CO CO 98050473614
13K137 TRAILER IN 87 KTY 1KKVF4828HL079192 RS CO CO 98050473616
13K139 TRAILER IN 87 KTY 1KKVF4821HL079194 RS CO CO 98050473619
13K140 TRAILER IN 87 KTY 1KKVF4823HL079195 RS CL LA 98050473622
13K141 TRAILER IN 87 KTY 1KKVF4825HL079196 RS CL LA 98050473623
13K143 TRAILER IN 87 KTY 1KKVF4829HL079198 RS CO CO 98050473626
</TABLE>
<PAGE>
PAGE 45
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ------ ------- -------- -------- ---- --------------------- -------- -------- --- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
13K144 TRAILER IN 87 KTY 1KKVF4820HL079199 RS CO CO 98050473629
13K145 TRAILER IN 87 KTY 1KKVF4823HL079200 RS CL LA 98050473631
13K146 TRAILER IN 87 KTY 1KKVF4825HL079201 RS CO CO 98050473633
13K147 TRAILER IN 87 KTY 1KKVF4827HL079202 RS CO CO 98050473635
13K148 TRAILER IN 87 KTY 1KKVF4829HL079203 RS CO CO 98050473638
13K151 TRAILER IN 87 KTY 1KKVF4824HL079206 RS CO CO 98050473641
13K153 TRAILER IN 87 KTY 1KKVF4828HL079208 RS CO CO 98050473643
13K154 TRAILER IN 87 KTY 1KKVF482XHL079209 RS CO CO 98050473645
13K156 TRAILER IN 87 KTY 1KKVF4828HL079211 RS CL LA 98050473650
13K157 TRAILER IN 87 KTY 1KKVF482XHL079212 RS CO CO 98050473652
13K159 TRAILER IN 87 KTY 1KKVF4823HL079214 RS CL LA 98050473655
13K160 TRAILER IN 87 KTY 1KKVF4825HL079215 RS CO CO 98050473657
13K161 TRAILER IN 87 KTY 1KKVF4827HL079216 RS CO CO 98050473658
13K164 TRAILER IN 87 KTY 1KKVF4822HL079219 RS CL LA 98050473660
13K165 TRAILER IN 87 KTY 1KKVF4829HL079220 RS CO CO 98050473662
13K166 TRAILER IN 87 KTY 1KKVF4820HL079221 RS CL LA 98050473665
13K167 TRAILER IN 87 KTY 1KKVF4822HL079222 RS CL LA 98050473668
13K168 TRAILER IN 87 KTY 1KKVF4824HL079223 RS CO CO 98050473670
13K169 TRAILER IN 87 KTY 1KKVF4826HL079224 RS CO CO 98050473672
13K170 TRAILER IN 87 KTY 1KKVF4828HL079225 RS CO CO 98050473679
13K171 TRAILER IN 87 KTY 1KKVF482XHL079226 RS CO CO 98050473682
13K172 TRAILER IN 87 KTY 1KKVF4821HL079227 RS CL LA 98050473684
13K173 TRAILER IN 87 KTY 1KKVF4823HL079228 RS CL LA 98050473686
13K174 TRAILER IN 87 KTY 1KKVF4825HL079229 RS CL LA 98050473687
13K175 TRAILER IN 87 KTY 1KKVF4821HL079230 RS CO CO 98050473689
13K176 TRAILER IN 87 KTY 1KKVF4823HL079231 RS CO CO 98050473691
13K177 TRAILER IN 87 KTY 1KKVF4825HL079232 RS CO CO 98050473692
13K203 TRAILER IN 87 KTY 1KKVF4828HL079239 RS CO CO 98050472887
13K266 TRAILER IN 87 KTY 1KKVF4825HL079523 RS CL LA 98050473003
13K267 TRAILER IN 87 KTY 1KKVF4827HL079524 RS CO CO 98050473004
13K269 TRAILER IN 87 KTY 1KKVF4820HL079526 RS CL LA 98050473006
13K270 TRAILER IN 87 KTY 1KKVF4822HL079527 RS CL LA 98050473007
13K271 TRAILER IN 87 KTY 1KKVF4824HL079528 RS CO CO 98050473008
13K272 TRAILER IN 87 KTY 1KKVF4826HL079529 RS CO CO 98050473009
13K274 TRAILER IN 87 KTY 1KKVF4824HL079531 RS CO CO 98050473010
13K275 TRAILER IN 87 KTY 1KKVF4826HL079532 RS CO CO 98050473028
13K277 TRAILER IN 87 KTY 1KKVF482XHL079534 RS CL LA 98050473041
13K278 TRAILER IN 87 KTY 1KKVF4821HL079535 RS CO CO 98050473047
13K281 TRAILER IN 87 KTY 1KKVF4827HL079538 RS CL LA 98050473060
13K284 TRAILER IN 87 KTY 1KKVF4827HL079541 RS CL LA 98050473075
13K285 TRAILER IN 87 KTY 1KKVF4829HL079542 RS CL LA 98050473084
13K288 TRAILER IN 87 KTY 1KKVF4824HL079545 RS CO CO 98050473100
13K289 TRAILER IN 87 KTY 1KKVF4826HL079546 RS CL LA 98050473108
13K290 TRAILER IN 87 KTY 1KKVF4828HL079547 RS CO CO 98050473116
13K291 TRAILER IN 87 KTY 1KKVF482XHL079548 RS CL LA 98050473125
13K292 TRAILER IN 87 KTY 1KKVF4821HL079549 RS CL LA 98050473131
13K293 TRAILER IN 87 KTY 1KKVF4828HL079550 RS CL LA 98050473141
13K294 TRAILER IN 87 KTY 1KKVF482XHL079551 RS CO CO 98050473149
13K295 TRAILER IN 87 KTY 1KKVF4821HL079552 RS CO CO 98050473155
13K296 TRAILER IN 87 KTY 1KKVF4823HL079553 RS CL LA 98050473164
</TABLE>
<PAGE>
PAGE 46
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
13K299 TRAILER IN 87 KTY 1KKVF4829HL079556 RS CO CO 98050473187
13K300 TRAILER IN 87 KTY 1KKVF4820HL079557 RS CL LA 98050473199
13K301 TRAILER IN 87 KTY 1KKVF4822HL079558 RS CO CO 98050473207
13K302 TRAILER IN 87 KTY 1KKVF4824HL079559 RS CO CO 98050473213
13K303 TRAILER IN 87 KTY 1KKVF4820HL079560 RS CO CO 98050473219
13K304 TRAILER IN 87 KTY 1KKVF4822HL079561 RS CO CO 98050473226
13K306 TRAILER IN 87 KTY 1KKVF4826HL079563 RS CO CO 98050473235
13K308 TRAILER IN 87 KTY 1KKVF482XHL079565 RS CL LA 98050473248
13K310 TRAILER IN 87 KTY 1KKVF4823HL079567 RS CO CO 98050473261
13K311 TRAILER IN 87 KTY 1KKVF4825HL079568 RS CL LA 98050473267
13K312 TRAILER IN 87 KTY 1KKVF4827HL079569 RS CO CO 98050473274
13K313 TRAILER IN 87 KTY 1KKVF4823HL079570 RS CO CO 98050473283
13K314 TRAILER IN 87 KTY 1KKVF4825HL079571 RS CO CO 98050473292
13K315 TRAILER IN 87 KTY 1KKVF4827HL079572 RS CL LA 98050473302
130579 TRAILER IN 79 KTY 057822 RS CL LA 98050473122
130609 TRAILER IN 79 KTY 057852 RS CO CO 98050473130
130610 TRAILER IN 79 KTY 057853 FD TR TG 98050473139
131906 TRAILER IN 68 KTY 035246 FS SL SI 98050473221
131907 TRAILER IN 68 KTY 035247 RS CO CO 98050473230
131996 TRAILER IN 68 KTY 035946 FS FA ST 98050473240
132154 TRAILER IN 69 THE N14928 FS SL SU 98050473244
135572 TRAILER IN 73 KTY 045972 RS CO CO 98050473255
135621 TRAILER IN 73 KTY 046021 RS CO CO 98050473263
136708 TRAILER IN 97 KTY 1KKVF5035VL110050 RS CO CO 98050473266
136709 TRAILER IN 97 KTY 1KKVF5028VL110051 RS CO CO 98050473271
150660 TRAILER IN 88 GTD 1GRDM9625JM012504 IN CO CO 98050473291
150663 TRAILER IN 88 GTD 1GRDM9629JM012506 IN CO CO 98050473299
151939 TRAILER IN 91 FON 13N348201M1552793 IN CO CO 98050473304
155054 TRAILER IN 95 STK 1S12FF481SB695357 IN CO CO 98050473311
155061 TRAILER IN 95 STK 1S12FF481SB695360 IN CO CO 98050473314
156392 TRAILER IN 97 TCF 1TTF48206V1052474 IN CO CO 98050473317
156839 TRAILER IN 75 KTY 048578 IN CO CO 98050473348
156843 TRAILER IN 75 KTY 048582 IN CO CO 98050473349
156964 TRAILER IN 98 TCF 1TTE48200H1056176 IN CO CO 98050473322
156965 TRAILER IN 98 TCF 1TTE48202H1056177 IN CO CO 98050473324
157477 TRAILER IN 98 TCF 1TTE48200H1057375 FB CO CO 98184617002
166504 TRAILER IN 97 KTY 1KKVR4827VL109205 HV CO CO 98050473327
166505 TRAILER IN 97 KTY 1KKVR4829VL109206 HV CO CO 98050473331
166506 TRAILER IN 97 KTY 1KKVR4820VL109207 HV CO CO 98050473332
166507 TRAILER IN 97 KTY 1KKVR4822VL109208 HV CO CO 98050473336
167457 TRAILER IN 98 KTY 1KKVR4820HL112366 HV CO CO 98184494030
220716 TRACTOR IN 85 INT 1HTLDTVN3FHA60944 HV DC 04 98050473972
221378 TRACTOR IN 90 INT 1HSHBGFN3LH215331 HV DC 04 98050473971
221386 TRACTOR IN 90 INT 1HSHBGFN5LH215329 HV DC 04 98050473970
221406 TRACTOR IN 90 INT 1HSHBGFN5LH215332 HV DC 04 98050473973
221438 TRACTOR IN 90 INT 1HSHBGFN7LH215333 HV DC 04 98050473974
221462 TRACTOR IN 90 INT 1HSHBGFN9LH215334 HV DC 04 98050473975
221517 TRACTOR IN 90 INT 1HSHBGFN8LH208231 HV DC 04 98050473976
221549 TRACTOR IN 97 INT 1HSSDAAN5VH412170 HV DC 04 98050473883
222099 TRACTOR IN 97 FRT 1FUWHLBB2VL704508 HV DC 04 98050473884
</TABLE>
<PAGE>
PAGE 47
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ------ --------- -------- -------- ---- ------------------------ -------- -------- --- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
222105 TRACTOR IN 97 FRT 1FUWHLBB4VL704509 HV DC 04 98050473885
223239 TRACTOR IN 88 INT 1HSZEGGR2JH538568 HV DC 10 98050473929
223245 TRACTOR IN 88 INT 1HSZEGGR2JH538571 HV DC 10 98050473930
223362 TRACTOR IN 88 FRT 1FUY2RYB3JH405395 HV DC 09 98050473933
226247 TRACTOR IN 89 INT 1HSZDGFN8KH618010 HV DC 04 98050473977
226255 TRACTOR IN 89 INT 1HSZDGFNXKH618011 HV DC 04 98050473978
228387 TRACTOR CA 85 INT 1HSRBLWN8FHB17089 HV DC I1 98050473886
23A021 TRACTOR IN 90 FRT 1FUYARYB2LH388521 HV DC 04 98050473887
23A164 TRACTOR IN 90 FRT 1FUYARYB2LH388664 HV DC 04 98050473888
23A275 TRACTOR IN 90 FRT 1FUYARYB0LH388775 HV DC 04 98050473889
23C024 TRACTOR IN 92 INT 1HSRKGAR3NH406832 FD TR TG 98050473893
23C068 TRACTOR IN 92 INT 1HSRKGAR5NH434048 HV DC 04 98050473894
23C085 TRACTOR IN 92 INT 1HSRKGAR5NH434065 HV DC 04 98050473895
23C108 TRACTOR IN 92 INT 1HSRKGAR6NH434088 HV DC 04 98050473896
23C177 TRACTOR IN 92 INT 1HSRKGAR7NH447996 HV DC 04 98050473897
23C257 TRACTOR IN 92 FRT 1FUYABYBXNH479093 HV DC 09 98050473898
23C280 TRACTOR IN 92 FRT 1FUYABYB7NH479116 HV DC 04 98050473899
23E007 TRACTOR IN 93 INT 1HSRKGAR7PH472397 FD TR TG 98050473900
23E040 TRACTOR IN 93 INT 1HSRKGAR1PH472430 FD TR TG 98050473901
23E155 TRACTOR IN 93 INT 1HSRKGAR7PH472545 HV DC 04 98050473903
23E184 TRACTOR IN 93 INT 1HSRKCAR9PH510334 FD TR TG 98050473904
23E191 TRACTOR IN 93 INT 1HSRKCAR6PH510341 FD TR TG 98050473905
23E193 TRACTOR IN 93 INT 1HSRKCARXPH510343 FD TR TG 98050493906
23E194 TRACTOR IN 93 INT 1HSRKCAR1PH510344 FD TR TG 98050473907
23E203 TRACTOR IN 93 INT 1HSRKCAR2PH510353 FD TR TG 98050473908
230226 TRACTOR IN 87 FRT 1FUYZBYB8HH402168 FS SL SI 98050473911
230239 TRACTOR IN 91 INT 1HSRKLRR0MH389760 FD TR TG 98050473912
230292 TRACTOR IN 91 INT 1HSRKLRR4MH389762 FD TR TG 98050473913
230426 TRACTOR IN 87 FRT 1FUYZBYB9HH404964 HV DC 10 98050473914
231092 TRACTOR IN 95 FRT 1FUYDCYB7SH541591 BH OO RM 98184617005
231580 TRACTOR IN 92 INT 1HSRKLRR3NH449953 FD TR TG 98050473916
231670 TRACTOR IN 92 INT 1HSRKLRR8NH449995 FD TR TG 98050473918
231713 TRACTOR IN 92 INT 1HSRKRGR7NH450013 HV DC 04 98050473920
231747 TRACTOR IN 92 INT 1HSRKRGR6NH450021 HV DC 09 98050473921
232806 TRACTOR IN 93 INT 2HSFHHAR9PC070458 FD TR TG 98050473939
233038 TRACTOR IN 88 INT 1HSRDG2R9JH602521 FS FA 01 98050473924
233233 TRACTOR IN 88 INT 1HSZEGGR5JH535549 HV DC 04 98050473925
233237 TRACTOR IN 88 INT 1HSZEGGR5JH535552 RS AG LF 98050473927
233238 TRACTOR IN 88 INT 1HSZEGGR7JH535553 RS AG LF 98050473928
233290 TRACTOR IN 87 FRT 1FUYZBYB8HH402140 RS AG LF 98050473931
233296 TRACTOR IN 87 FRT 1FUYZBYB5HH402144 RS AG LF 98050473932
234037 TRACTOR IN 95 WGC 4V1HDBRH1SN694031 FD TR TG 98050473934
237998 TRACTOR CA 85 INT 1HSRDJSR1FHB16700 HV DC I1 98050473956
320523 ST. TRUCK IN 91 FOR 1FDXH81A7MVA33045 HV DC 04 98050473980
320524 ST. TRUCK IN 91 FOR 1FDXH81A9MVA33046 HV DC 04 98050473981
321227 ST. TRUCK IN 88 PBT 9DHHT7H34JC001852 FD TR TG 98050473828
321255 ST. TRUCK IN 97 INT 1HTSDAAN2VH412171 HV DC 04 98050473830
321256 ST. TRUCK IN 97 INT 1HTSDAAN7VH437101 RS AG SF 98050473832
321257 ST. TRUCK NY 97 INT 1HTSDAAN9VH437102 RS AG SF 98050473833
321259 ST. TRUCK UT 97 INT 1HTSDAAN2VH437104 RS AG SF 98050473835
</TABLE>
<PAGE>
PAGE 48
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
---- ---- --- -- ---- ------ --- --- -- ------
<C> <S> <C> <C> <C> <C> <C> <C> <C> <C>
321263 ST.TRUCK IN 97 INT 1HTSDAANXVH437108 RS AG SF 98050473838
321316 ST.TRUCK IN 97 INT 1HTSDAAN5VH442054 RS AG SF 98050473840
321367 ST.TRUCK IN 85 GMC 1GDG6D1F3FV508896 FS FA 01 98050473842
328369 ST.TRUCK IN 85 INT 1HTLDUXN6FHA31005 HV DC 04 98050473982
328500 ST.TRUCK CA 85 INT 1HTLOUGNXFHA63326 HV DC 02 98050473843
500002 DOLLY IN 93 STK 1S11CD106PB676169 HV DC 04 98050473790
500003 DOLLY CA 93 STK 1S11CD102PB676170 HV DC 02 98050473792
500007 DOLLY IN 93 FRU 1H2E00013PB013801 HV DC 09 98050473794
500008 DOLLY IN 93 FRU 1H2E00015PB013802 HV DC 09 98050473795
500012 DOLLY IN 95 STK 1S11CD109SB705091 HV CO CO 98050473796
500013 DOLLY IN 95 STK 1S11CD100SB705092 HV CO CO 98050473797
500014 DOLLY IN 95 STK 1S11CD102SB705093 HV CO CO 98050473799
500015 DOLLY IN 95 STK 1S11CD104SB705094 HV CO CO 98050473800
500016 DOLLY IN 95 STK 1S11CD106SB705095 HV CO CO 98050473802
500017 DOLLY IN 95 STK 1S11CD108SB705096 HV CO CO 98050473803
500018 DOLLY IN 95 STK 1S11CD10XSB705097 HV CO CO 98050473805
500019 DOLLY IN 95 STK 1S11CD101SB705098 HV CO CO 98050473807
500020 DOLLY IN 95 STK 1S11CD103SB705099 HV CO CO 98050473809
500021 DOLLY IN 95 STK 1S11CD106SB705100 HV CO CO 98050473811
500022 DOLLY IN 95 STK 1S11CD108SB705101 HV CO CO 98050473813
500023 DOLLY IN 95 STK 1S11CD10XSB705102 HV CO CO 98050473814
500024 DOLLY IN 95 STK 1S11CD101SB705103 HV CO CO 98050473816
610001 TRAILER IN 94 STN 1DW1A4829RS835900 BW CO CO 98050473338
610002 TRAILER IN 94 STN 1DW1A4820RS835901 BW CO CO 98050473339
610003 TRAILER IN 94 STN 1DW1A4822RS835902 BW CO CO 98050473340
610004 TRAILER IN 94 STN 1DW1A4824RS835903 BW CO CO 98050473341
610005 TRAILER IN 94 STN 1DW1A4826RS835904 BW CO CO 98050473342
610006 TRAILER IN 94 STN 1DW1A4828RS835905 BW CO CO 98050473343
610007 TRAILER IN 94 STN 1DW1A482XRS835906 BW CO CO 98050473344
610008 TRAILER IN 94 STN 1DW1A4821RS835907 BW CO CO 98050473345
610009 TRAILER IN 94 STN 1DW1A4823RS835908 BW CO CO 98050473346
610010 TRAILER IN 94 STN 1DW1A4825RS835909 BW CO CO 98050473347
610011 TRAILER IN 94 STN 1DW1A4821RS835910 BW CO CO 98050473068
610012 TRAILER IN 94 STN 1DW1A4823RS835911 BW CO CO 98050473078
610013 TRAILER IN 94 STN 1DW1A4825RS835912 BW CO CO 98050473085
610014 TRAILER IN 94 STN 1DW1A4827RS835913 BW CO CO 98050473094
610015 TRAILER IN 94 STN 1DW1A4829RS835914 BW CO CO 98050473102
610016 TRAILER IN 94 STN 1DW1A4820RS835915 BW CO CO 98050473109
610017 TRAILER IN 94 STN 1DW1A4822RS835916 BW CO CO 98050473117
610018 TRAILER IN 94 STN 1DW1A4824RS835917 BW CO CO 98050473127
610019 TRAILER IN 94 STN 1DW1A4826RS835918 BW CO CO 98050473132
610020 TRAILER IN 94 STN 1DW1A4828RS835919 BW CO CO 98050473966
610021 TRAILER IN 94 STN 1DW1A4824RS835920 BW CO CO 98050473140
610022 TRAILER IN 94 STN 1DW1A4826RS835921 BW CO CO 98050473145
610023 TRAILER IN 94 STN 1DW1A4828RS835922 BW CO CO 98050473157
610024 TRAILER IN 94 STN 1DW1A482XRS835923 BW CO CO 98050473169
610025 TRAILER IN 94 STN 1DW1A4821RS835924 BW CO CO 98050473178
610026 TRAILER IN 94 STN 1DW1A4823RS835925 BW CO CO 98050473188
610027 TRAILER IN 94 STN 1DW1A4825RS835926 BW CO CO 98050473195
610028 TRAILER IN 94 STN 1DW1A4827RS835927 BW CO CO 98050473204
</TABLE>
<PAGE>
PAGE 49
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
610029 TRAILER IN 94 STN 1DW1A4829RS835928 BW CO CO 98050473214
610030 TRAILER IN 94 STN 1DW1A4820RS835929 BW CO CO 98050473220
610031 TRAILER IN 94 STN 1DW1A4827RS835930 BW CO CO 98050473228
610032 TRAILER IN 94 STN 1DW1A4829RS835931 BW CO CO 98050473236
610033 TRAILER IN 94 STN 1DW1A4829RS835932 BW CO CO 98050473243
610034 TRAILER IN 93 STK 1S12E9483PE359736 BW CO CO 98050473249
610035 TRAILER IN 93 STK 1S12E9485PE359737 BW CO CO 98050473257
610036 TRAILER IN 93 STK 1S12E9487PE359738 BW CO CO 98050473262
610037 TRAILER IN 93 STK 1S12E9489PE359739 BW CO CO 98050473268
610038 TRAILER IN 93 STK 1S12E9485PE359740 BW CO CO 98050473275
610039 TRAILER IN 93 STK 1S12E9487PE359741 BW CO CO 98050473284
610040 TRAILER IN 93 STK 1S12E9489PE359742 BW CO CO 98050473290
610041 TRAILER IN 93 STK 1S12E9480PE359743 BW CO CO 98050473296
610042 TRAILER IN 93 STK 1S12E9482PE359744 BW CO CO 98050473305
610043 TRAILER IN 93 STK 1S12E9484PE359745 BW CO CO 98050473316
610044 TRAILER IN 93 STK 1S12E9486PE359746 BW CO CO 98050473320
610045 TRAILER IN 93 STK 1S12E9488PE359747 BW CO CO 98050473326
610046 TRAILER IN 93 STK 1S12E948XPE359748 BW CO CO 98050473329
610047 TRAILER IN 93 STK 1S12E9481PE359749 BW CO CO 98050473334
610048 TRAILER IN 93 STK 1S12E9488PE359750 BW CO CO 98050473325
610049 TRAILER IN 93 STK 1S12E948XPE359751 BW CO CO 98050473253
610050 TRAILER IN 93 STK 1S12E9481PE359752 BW CO CO 98050473258
610051 TRAILER IN 93 STK 1S12E9483PE359753 BW CO CO 98050473265
610052 TRAILER IN 93 STK 1S12E9485PE359754 BW CO CO 98050473328
610053 TRAILER IN 93 STK 1S12E9487PE359755 BW CO CO 98050473321
610054 TRAILER IN 93 STK 1S12E9489PE359756 BW CO CO 98050473318
610055 TRAILER IN 93 STK 1S12E9480PE359757 BW CO CO 98050473315
610056 TRAILER IN 93 STK 1S12E9482PE359758 BW CO CO 98050473310
610057 TRAILER IN 93 STK 1S12E9484PE359759 BW CO CO 98050473300
610058 TRAILER IN 93 STK 1S12E9480PE359760 BW CO CO 98050473294
610059 TRAILER IN 93 STK 1S12E9482PE359761 BW CO CO 98050473289
610060 TRAILER IN 93 STK 1S12E9484PE359762 BW CO CO 98050473281
610061 TRAILER IN 93 STK 1S12E9486PE359763 BW CO CO 98050473272
610062 TRAILER IN 93 STK 1S12E9488PE359764 BW CO CO 98050473512
610063 TRAILER IN 93 STK 1S12E948XPE359765 BW CO CO 98050473516
610064 TRAILER IN 93 STK 1S12E9481PE359766 BW CO CO 98050473519
610065 TRAILER IN 93 STK 1S12E9483PE359767 BW CO CO 98050473522
610066 TRAILER IN 93 STK 1S12E9485PE359768 BW CO CO 98050473527
610067 TRAILER IN 93 STK 1S12E9487PE359769 BW CO CO 98050473534
610068 TRAILER IN 93 STK 1S12E9483PE359770 BW CO CO 98050473538
610069 TRAILER IN 93 STK 1S12E9485PE359771 BW CO CO 98050473542
610070 TRAILER IN 93 STK 1S12E9487PE359772 BW CO CO 98050473546
610071 TRAILER IN 93 STK 1S12E9489PE359773 BW CO CO 98050473551
610072 TRAILER IN 93 STK 1S12E9480PE359774 BW CO CO 98050473562
610073 TRAILER IN 93 STK 1S12E9482PE359775 BW CO CO 98050473565
610074 TRAILER IN 93 STK 1S12E9484PE359776 BW CO CO 98050473570
610075 TRAILER IN 93 STK 1S12E9486PE359777 BW CO CO 98050473573
610076 TRAILER IN 93 STK 1S12E9488PE359778 BW CO CO 98050473576
610077 TRAILER IN 93 STK 1S12E948XPE359779 BW CO CO 98050473580
610078 TRAILER IN 93 STK 1S12E9486PE359780 BW CO CO 98050473585
</TABLE>
<PAGE>
PAGE 50
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
610079 TRAILER IN 93 STK 1S12E9488PE359781 BW CO CO 98050473588
610080 TRAILER IN 93 STK 1S12E948XPE359782 BW CO CO 98050473592
610081 TRAILER IN 93 STK 1S12E9481PE359783 BW CO CO 98050473595
610082 TRAILER IN 93 STK 1S12E9483PE359784 BW CO CO 98050473598
610083 TRAILER IN 93 STK 1S12E9485PE359785 BW CO CO 98050473600
610196 TRAILER IN 85 KTY 1KKVE4827FL074128 BW CO CO 98050473491
610198 TRAILER IN 85 KTY 1KKVE4825FL072832 BW CO CO 98050473495
610199 TRAILER IN 86 KTY 1KKVE4823GL075343 BW CO CO 98050473499
610201 TRAILER IN 86 KTY 1KKVE4822GL075222 BW CO CO 98050473501
610202 TRAILER IN 86 KTY 1KKVE4825GL075134 BW CO CO 98050473504
610203 TRAILER IN 86 KTY 1KKVE4824GL075058 BW CO CO 98050473509
610204 TRAILER IN 85 KTY 1KKVE4822FL074151 BW CO CO 98050473506
610205 TRAILER IN 96 STN 1DW1A4825TS038101 BW CO CO 98050473606
610206 TRAILER IN 96 STN 1DW1A4827TS038102 BW CO CO 98050473609
610207 TRAILER IN 96 STN 1DW1A4829TS038103 BW CO CO 98050473613
610208 TRAILER IN 96 STN 1DW1A4820TS038104 BW CO CO 98050673617
610209 TRAILER IN 96 STN 1DW1A4822TS038105 BW CO CO 98050473620
610210 TRAILER IN 96 STN 1DW1A4824TS038106 BW CO CO 98050473624
610211 TRAILER IN 96 STN 1DW1A4826TS038107 BW CO CO 98050473628
610212 TRAILER IN 96 STN 1DW1A4828TS038108 BW CO CO 98050473632
610213 TRAILER IN 96 STN 1DW1A482XTS038109 BW CO CO 98050473636
610214 TRAILER IN 96 STN 1DW1A4826TS038110 BW CO CO 98050473640
610215 TRAILER IN 96 STN 1DW1A4828TS038111 BW CO CO 98050473644
610216 TRAILER IN 96 STN 1DW1A482XTS038112 BW CO CO 98050473648
610217 TRAILER IN 96 STN 1DW1A4821TS038113 BW CO CO 98050473649
610218 TRAILER IN 96 STN 1DW1A4823TS038114 BW CO CO 98050473653
610219 TRAILER IN 96 STN 1DW1A4825TS038115 BW CO CO 98050473663
610220 TRAILER IN 96 STN 1DW1A4827TS038116 BW CO CO 98050473667
610221 TRAILER IN 96 STN 1DW1A4829TS038117 BW CO CO 98050473671
610222 TRAILER IN 96 STN 1DW1A4820TS038118 BW CO CO 98050473674
610223 TRAILER IN 96 STN 1DW1A4822TS038119 BW CO CO 98050473678
610224 TRAILER IN 96 STN 1DW1A4829TS038120 BW CO CO 98050473681
670084 TRAILER IN 93 STK 1S12E9533PE359402 BW CO CO 98050473354
670085 TRAILER IN 93 STK 1S12E9535PE359403 BW CO CO 98050473359
670086 TRAILER IN 93 STK 1S12E9537PE359404 BW CO CO 98050473362
670087 TRAILER IN 93 STK 1S12E9539PE359405 BW CO CO 98050473366
670088 TRAILER IN 93 STK 1S12E9530PE359406 BW CO CO 98050473369
670089 TRAILER IN 93 STK 1S12E9532PE359407 BW CO CO 98050473374
670090 TRAILER IN 93 STK 1S12E9534PE359408 BW CO CO 98050473379
670091 TRAILER IN 93 STK 1S12E9536PE359409 BW CO CO 98050473384
670092 TRAILER IN 93 STK 1S12E9532PE359410 BW CO CO 98050473389
670093 TRAILER IN 93 STK 1S12E9534PE359411 BW CO CO 98050473358
670094 TRAILER IN 93 STK 1S12E9536PE359412 BW CO CO 98050473364
670095 TRAILER IN 93 STK 1S12E9538PE359413 BW CO CO 98050473371
670096 TRAILER IN 93 STK 1S12E953XPE359414 BW CO CO 98050473380
670097 TRAILER IN 93 STK 1S12E9531PE359415 BW CO CO 98050473390
670098 TRAILER IN 93 STK 1S12E9533PE359416 BW CO CO 98050473395
670099 TRAILER IN 93 STK 1S12E9535PE359417 BW CO CO 98050473721
670100 TRAILER IN 93 STK 1S12E9537PE359418 BW CO CO 98050473722
670101 TRAILER IN 93 STK 1S12E9539PE359419 BW CO CO 98050473724
</TABLE>
<PAGE>
PAGE 51
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ---- ---- --- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
670102 TRAILER IN 93 STK 1S12E9535PE359420 BW CO CO 98050473726
670103 TRAILER IN 93 STK 1S12E9537PE359421 BW CO CO 98050473728
670104 TRAILER IN 93 STK 1S12E9539PE359422 BW CO CO 98050473730
670105 TRAILER IN 93 STK 1S12E9530PE359423 BW CO CO 98050473732
670106 TRAILER IN 93 STK 1S12E9532PE359424 BW CO CO 98050473734
670107 TRAILER IN 93 STK 1S12E9534PE359425 BW CO CO 98050473736
670108 TRAILER IN 93 STK 1S12E9536PE359426 BW CO CO 98050473738
670109 TRAILER IN 93 STK 1S12E9538PE359427 BW CO CO 98050473740
670110 TRAILER IN 93 STK 1S12E953XPE359428 BW CO CO 98050473742
670111 TRAILER IN 93 STK 1S12E9531PE359429 BW CO CO 98050473744
670112 TRAILER IN 93 STK 1S12E9538PE359430 BW CO CO 98050473745
670113 TRAILER IN 93 STK 1S12E953XPE359431 BW CO CO 98050473435
670114 TRAILER IN 93 STK 1S12E9531PE359432 BW CO CO 98050473436
670115 TRAILER IN 93 STK 1S12E9533PE359433 BW CO CO 98050473438
670116 TRAILER IN 93 STK 1S12E9535PE359434 BW CO CO 98050473440
670117 TRAILER IN 93 STK 1S12E9537PE359435 BW CO CO 98050473441
670118 TRAILER IN 93 STK 1S12E9539PE359436 BW CO CO 98050473443
670119 TRAILER IN 93 STK 1S12E9530PE359437 BW CO CO 98050473445
670120 TRAILER IN 93 STK 1S12E9532PE359438 BW CO CO 98050473447
670121 TRAILER IN 93 STK 1S12E9534PE359439 BW CO CO 98050473449
670122 TRAILER IN 93 STK 1S12E9530PE359440 BW CO CO 98050473451
670123 TRAILER IN 93 STK 1S12E9532PE359441 BW CO CO 98050473453
670124 TRAILER IN 93 STK 1S12E9534PE359442 BW CO CO 98050473455
670125 TRAILER IN 93 STK 1S12E9536PE359443 BW CO CO 98050473456
670126 TRAILER IN 93 STK 1S12E9538PE359444 BW CO CO 98050473458
670127 TRAILER IN 93 STK 1S12E953XPE359445 BW CO CO 98050473460
670128 TRAILER IN 93 STK 1S12E9531PE359446 BW CO CO 98050473462
670129 TRAILER IN 93 STK 1S12E9533PE359447 BW CO CO 98050473464
670130 TRAILER IN 93 STK 1S12E9535PE359448 BW CO CO 98050473466
670131 TRAILER IN 93 STK 1S12E9537PE359449 BW CO CO 98050473467
670132 TRAILER IN 93 STK 1S12E9533PE359450 BW CO CO 98050473469
670133 TRAILER IN 93 STK 1S12E9535PE359451 BW CO CO 98050473471
670134 TRAILER IN 93 STK 1S12E9537PE359452 BW CO CO 98050473357
670135 TRAILER IN 93 STK 1S12E9539PE359453 BW CO CO 98050473361
670136 TRAILER IN 93 STK 1S12E9530PE359454 BW CO CO 98050473365
670137 TRAILER IN 93 STK 1S12E9532PE359455 BW CO CO 98050473370
670138 TRAILER IN 93 STK 1S12E9534PE359456 BW CO CO 98050473376
670139 TRAILER IN 93 STK 1S12E9536PE359457 BW CO CO 98050473382
670140 TRAILER IN 93 STK 1S12E9538PE359458 BW CO CO 98050473388
670141 TRAILER IN 93 STK 1S12E953XPE359459 BW CO CO 98050473393
670142 TRAILER IN 93 STK 1S12E9536PE359460 BW CO CO 98050473399
670143 TRAILER IN 93 STK 1S12E9538PE359461 BW CO CO 98050473829
670144 TRAILER IN 93 STK 1S12E953XPE359462 BW CO CO 98050473831
670145 TRAILER IN 93 STK 1S12E9531PE359463 BW CO CO 98050473834
670146 TRAILER IN 93 STK 1S12E9533PE359464 BW CO CO 98050473836
670147 TRAILER IN 93 STK 1S12E9535PE359465 BW CO CO 98050473839
670148 TRAILER IN 93 STK 1S12E9537PE359466 BW CO CO 98050473844
670149 TRAILER IN 93 STK 1S12E9539PE359467 BW CO CO 98050473847
670150 TRAILER IN 93 STK 1S12E9530PE359468 BW CO CO 98050473849
670151 TRAILER IN 93 STK 1S12E9532PE359469 BW CO CO 98050473851
</TABLE>
<PAGE>
PAGE 52
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
---- ---- --- -- ---- ------ --- --- -- ------
<C> <S> <C> <C> <C> <C> <C> <C> <C> <C>
670152 TRAILER IN 93 STK 1S12E9539PE359470 BW CO CO 98050473854
670153 TRAILER IN 93 STK 1S12E9530PE359471 BW CO CO 98050473857
670154 TRAILER IN 93 STK 1S12E9532PE359472 BW CO CO 98050473860
670155 TRAILER IN 93 STK 1S12E9534PE359473 BW CO CO 98050473862
670156 TRAILER IN 93 STK 1S12E9536PE359474 BW CO CO 98050473864
670157 TRAILER IN 93 STK 1S12E9538PE359475 BW CO CO 98050473867
670158 TRAILER IN 93 STK 1S12E953XPE359476 BW CO CO 98050473869
670225 TRAILER IN 96 STN 1DW1A5321TS034401 BW CO CO 98050473760
670226 TRAILER IN 96 STN 1DW1A5323TS034402 BW CO CO 98050473763
670227 TRAILER IN 96 STN 1DW1A5325TS034403 BW CO CO 98050473766
670228 TRAILER IN 96 STN 1DW1A5327TS034404 BW CO CO 98050473770
670229 TRAILER IN 96 STN 1DW1A5329TS034405 BW CO CO 98050473773
670230 TRAILER IN 96 STN 1DW1A5320TS034406 BW CO CO 98050473777
670231 TRAILER IN 97 KTY 1KKVA5321VL108877 BW CO CO 98050473781
670232 TRAILER IN 97 KTY 1KKVA5323VL108878 BW CO CO 98050473784
670233 TRAILER IN 97 KTY 1KKVA5325VL108879 BW CO CO 98050473787
670234 TRAILER IN 97 KTY 1KKVA5321VL108880 BW CO CO 98050473789
670235 TRAILER IN 97 KTY 1KKVA5323VL108881 BW CO CO 98050473791
670236 TRAILER IN 97 KTY 1KKVA5325VL108882 BW CO CO 98050473793
670237 TRAILER IN 97 KTY 1KKVA5327VL108883 BW CO CO 98050473798
670238 TRAILER IN 97 KTY 1KKVA5329VL108884 BW CO CO 98050473801
670239 TRAILER IN 97 KTY 1KKVA5320VL108885 BW CO CO 98050473804
670240 TRAILER IN 97 KTY 1KKVA5322VL108886 BW CO CO 98050473806
670241 TRAILER IN 97 KTY 1KKVA5324VL108887 BW CO CO 98050473808
670242 TRAILER IN 97 KTY 1KKVA5326VL108888 BW CO CO 98050473810
670243 TRAILER IN 97 KTY 1KKVA5328VL108889 BW CO CO 98050473812
670244 TRAILER IN 97 KTY 1KKVA5324VL108890 BW CO CO 98050473815
670245 TRAILER IN 97 KTY 1KKVA5326VL108891 BW CO CO 98050473819
670246 TRAILER IN 97 KTY 1KKVA5328VL108892 BW CO CO 98050473821
670247 TRAILER IN 97 KTY 1KKVA532XVL108893 BW CO CO 98050473822
670248 TRAILER IN 97 KTY 1KKVA5321VL108894 BW CO CO 98050473823
670249 TRAILER IN 97 KTY 1KKVA5323VL108895 BW CO CO 98050473826
670250 TRAILER IN 97 KTY 1KKVA5325VL108896 BW CO CO 98050473372
670251 TRAILER IN 97 KTY 1KKVA5327VL108897 BW CO CO 98050473378
670252 TRAILER IN 97 KTY 1KKVA5329VL108898 BW CO CO 98050473383
670253 TRAILER IN 97 KTY 1KKVA5320VL108899 BW CO CO 98050473387
670254 TRAILER IN 97 KTY 1KKVA5323VL108900 BW CO CO 98050473392
670255 TRAILER IN 97 KTY 1KKVA5325VL108901 BW CO CO 98050473397
670256 TRAILER IN 97 KTY 1KKVA5327VL108902 BW CO CO 98050473401
670257 TRAILER IN 97 KTY 1KKVA5329VL108903 BW CO CO 98050473404
670258 TRAILER IN 97 KTY 1KKVA5320VL108904 BW CO CO 98050473406
670259 TRAILER IN 97 KTY 1KKVA5322VL108905 BW CO CO 98050475408
670260 TRAILER IN 97 KTY 1KKVA5324VL108906 BW CO CO 98050473409
670261 TRAILER IN 97 KTY 1KKVA5326VL108907 BW CO CO 98050473410
670262 TRAILER IN 97 KTY 1KKVA5328VL108908 BW CO CO 98050473411
670263 TRAILER IN 97 KTY 1KKVA532XVL108909 BW CO CO 98050473412
670264 TRAILER IN 97 KTY 1KKVA5326VL108910 BW CO CO 98050473413
670265 TRAILER IN 97 KTY 1KKVA5328VL108911 BW CO CO 98050473414
670266 TRAILER IN 97 STK 1S12E9537VE422028 BW CO CO 98050473415
670267 TRAILER IN 97 STK 1S12E9539VE422029 BW CO CO 98050473416
</TABLE>
<PAGE>
PAGE 53
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
670268 TRAILER IN 97 STK 1S12E9535VE422030 BW CO CO 98050473417
670269 TRAILER IN 97 STK 1S12E9537VE422031 BW CO CO 98050473418
670270 TRAILER IN 97 STK 1S12E9539VE422032 BW CO CO 98050473419
670271 TRAILER IN 97 STK 1S12E9530VE422033 BW CO CO 98050473420
670272 TRAILER IN 97 STK 1S12E9532VE422034 BW CO CO 98050473421
670273 TRAILER IN 97 STK 1S12E9534VE422035 BW CO CO 98050473422
670274 TRAILER IN 97 STK 1S12E9536VE422036 BW CO CO 98050473423
670275 TRAILER IN 97 STK 1S12E9538VE422037 BW CO CO 98050473424
670276 TRAILER IN 97 STK 1S12E953XVE422038 BW CO CO 98050473425
670277 TRAILER IN 97 STK 1S12E9531VE422039 BW CO CO 98050473426
670278 TRAILER IN 97 STK 1S12E9538VE422040 BW CO CO 98050473427
670279 TRAILER IN 97 STK 1S12E953XVE422041 BW CO CO 98050473428
670280 TRAILER IN 97 STK 1S12E9531VE422042 BW CO CO 98050473429
670281 TRAILER IN 97 STK 1S12E9533VE422043 BW CO CO 98050473430
670282 TRAILER IN 97 STK 1S12E9535VE422044 BW CO CO 98050473431
670283 TRAILER IN 97 STK 1S12E9537VE422045 BW CO CO 98050473432
670284 TRAILER IN 97 STK 1S12E9539VE422046 BW CO CO 98050473433
670285 TRAILER IN 97 STK 1S12E9530VE422047 BW CO CO 98050473434
670286 TRAILER IN 97 STK 1S12E9532VE422048 BW CO CO 98050473437
670287 TRAILER IN 97 STK 1S12E9534VE422049 BW CO CO 98050473439
670288 TRAILER IN 97 STK 1S12E9530VE422050 BW CO CO 98050473442
670289 TRAILER IN 97 STK 1S12E9532VE422051 BW CO CO 98050473444
670290 TRAILER IN 97 STK 1S12E9534VE422052 BW CO CO 98050473446
670291 TRAILER IN 97 STK 1S12E9536VE422053 BW CO CO 98050473448
670292 TRAILER IN 97 STK 1S12E9538VE422054 BW CO CO 98050473450
670293 TRAILER IN 97 STK 1S12E953XVE422055 BW CO CO 98050473452
670294 TRAILER IN 97 STK 1S12E9531VE422056 BW CO CO 98050473454
670295 TRAILER IN 97 STK 1S12E9533VE422057 BW CO CO 98050473457
670296 TRAILER IN 97 STK 1S12E9535VE422058 BW CO CO 98050473459
670297 TRAILER IN 97 STK 1S12E9537VE422059 BW CO CO 98050473461
670298 TRAILER IN 97 STK 1S12E9533VE422060 BW CO CO 98050473463
670299 TRAILER IN 97 STK 1S12E9535VE422061 BW CO CO 98050473465
670300 TRAILER IN 97 STK 1S12E9537VE422062 BW CO CO 98050473468
670301 TRAILER IN 97 STK 1S12E9539VE422063 BW CO CO 98050473470
670302 TRAILER IN 97 STK 1S12E9530VE422064 BW CO CO 98050473472
670303 TRAILER IN 97 STK 1S12E9532VE422065 BW CO CO 98050473474
670304 TRAILER IN 97 STK 1S12E9534VE422066 BW CO CO 98050473477
670305 TRAILER IN 97 STK 1S12E9536VE422067 BW CO CO 98050473482
670306 TRAILER IN 97 STK 1S12E9538VE422068 BW CO CO 98050473484
670307 TRAILER IN 97 STK 1S12E953XVE422069 BW CO CO 98050473487
670308 TRAILER IN 97 STK 1S12E9536VE422070 BW CO CO 98050473489
670409 TRAILER IN 94 STN 1DW1A532XRS835000 BW CO CO 98050473490
670410 TRAILER IN 94 STN 1DW1A5321RS835001 BW CO CO 98050473492
670411 TRAILER IN 94 STN 1DW1A5323RS835002 BW CO CO 98050473493
670412 TRAILER IN 94 STN 1DW1A5325RS835003 BW CO CO 98050473496
670413 TRAILER IN 94 STN 1DW1A5327RS835004 BW CO CO 98050473498
670414 TRAILER IN 94 STN 1DW1A5329RS835005 BW CO CO 98050473500
670415 TRAILER IN 94 STN 1DW1A5320RS835006 BW CO CO 98050473502
670416 TRAILER IN 94 STN 1DW1A5322RS835007 BW CO CO 98050473503
670417 TRAILER IN 94 STN 1DW1A5324RS835008 BW CO CO 98050473505
</TABLE>
<PAGE>
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
PAGE 54
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
- ------ ------- -------- -------- ---- --------------------- -------- -------- --- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
670418 TRAILER IN 94 STN 1DW1A5326RS835009 BW CO CO 98050473507
670419 TRAILER IN 94 STN 1DW1A5322RS835010 BW CO CO 98050473508
670420 TRAILER IN 94 STN 1DW1A5324RS835011 BW CO CO 98050473510
670421 TRAILER IN 94 STN 1DW1A5326RS835012 BW CO CO 98050473523
670422 TRAILER IN 94 STN 1DW1A5328RS835013 BW CO CO 98050473524
670423 TRAILER IN 94 STN 1DW1A532XRS835014 BW CO CO 98050473526
670424 TRAILER IN 94 STN 1DW1A5321RS835015 BW CO CO 98050473530
670425 TRAILER IN 94 STN 1DW1A5323RS835016 BW CO CO 98050473532
670426 TRAILER IN 94 STN 1DW1A5325RS835017 BW CO CO 98050473535
670427 TRAILER IN 94 STN 1DW1A5327RS835018 BW CO CO 98050473539
670428 TRAILER IN 94 STN 1DW1A5329RS835019 BW CO CO 98050473541
670429 TRAILER IN 94 STN 1DW1A5325RS835020 BW CO CO 98050473544
670430 TRAILER IN 94 STN 1DW1A5327RS835021 BW CO CO 98050473547
670431 TRAILER IN 94 STN 1DW1A5329RS835022 BW CO CO 98050473550
670432 TRAILER IN 94 STN 1DW1A5320RS835023 BW CO CO 98050473553
670433 TRAILER IN 94 STN 1DW1A5322RS835024 BW CO CO 98050473554
670434 TRAILER IN 94 STN 1DW1A5324RS835025 BW CO CO 98050473556
670435 TRAILER IN 94 STN 1DW1A5326RS835026 BW CO CO 98050473558
670436 TRAILER IN 94 STN 1DW1A5328RS835027 BW CO CO 98050473560
670437 TRAILER IN 94 STN 1DW1A532XRS835028 BW CO CO 98050473563
670438 TRAILER IN 94 STN 1DW1A5321RS835029 BW CO CO 98050473566
670439 TRAILER IN 94 STN 1DW1A5328RS835030 BW CO CO 98050473568
670441 TRAILER IN 94 STN 1DQ1A5321RS835032 BW CO CO 98050473571
670442 TRAILER IN 94 STN 1DW1A5323RS835033 BW CO CO 98050473574
670443 TRAILER IN 94 STN 1DW1A5325RS835034 BW CO CO 98050473577
670444 TRAILER IN 94 STN 1DW1A5327RS835035 BW CO CO 98050473579
670445 TRAILER IN 94 STN 1DW1A5329RS835036 BW CL LA 98050473582
670446 TRAILER IN 94 STN 1DW1A5320RS835037 BW CO CO 98050473584
670447 TRAILER IN 94 STN 1DW1A5322RS835038 BW CO CO 98050473587
670448 TRAILER IN 94 STN 1DW1A5324RS835039 BW CO CO 98050473590
670449 TRAILER IN 94 STN 1DW1A5320RS835040 BW CO CO 98050473593
670450 TRAILER IN 94 STN 1DW1A5322RS835041 BW CO CO 98050473596
670451 TRAILER IN 94 STN 1DW1A5324RS835042 BW CO CO 98050473602
670452 TRAILER IN 94 STN 1DW1A5326RS835043 BW CO CO 98050473604
670453 TRAILER IN 94 STN 1DW1A5328RS835044 BW CO CO 98050473607
670454 TRAILER IN 94 STN 1DW1A532XRS835045 BW CO CO 98050473608
670455 TRAILER IN 94 STN 1DW1A5321RS835046 BW CO CO 98050473612
670456 TRAILER IN 94 STN 1DW1A5323RS835047 BW CO CO 98050473615
670457 TRAILER IN 94 STN 1DW1A5325RS835048 BW CO CO 98050473618
670458 TRAILER IN 94 STN 1DW1A5327RS835049 BW CO CO 98050473621
670459 TRAILER IN 94 STN 1DW1A5323RS835050 BW CO CO 98050473625
670460 TRAILER IN 94 STN 1DW1A5325RS835051 BW CO CO 98050473627
670461 TRAILER IN 94 STN 1DW1A5327RS835052 BW CO CO 98050473630
670462 TRAILER IN 94 STN 1DW1A5329RS835053 BW CO CO 98050473634
670463 TRAILER IN 94 STN 1DW1A5320RS835054 BW CO CO 98050473637
670464 TRAILER IN 94 STN 1DW1A5322RS835055 BW CO CO 98050473639
670465 TRAILER IN 94 STN 1DW1A5324RS835056 BW CO CO 98050473642
670466 TRAILER IN 94 STN 1DW1A5326RS835057 BW CO CO 98050473646
670467 TRAILER IN 94 STN 1DW1A5328RS835058 BW CO CO 98050473651
670468 TRAILER IN 94 STN 1DW1A532XRS835059 BW CO CO 98050473654
</TABLE>
<PAGE>
PAGE 55
LIST OF NORTH AMERICAN VAN LINES TITLED EQUIPMENT AS OF 10/30/99
<TABLE>
<CAPTION>
LIC SERIAL TITLE
UNIT TYPE ST YR MAKE NUMBER DIV SUB FC NUMBER
---- ---- -- -- ---- ------ --- --- -- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
670469 TRAILER IN 94 STN 1DW1A5326RS835060 BW CO CO 98050473656
670470 TRAILER IN 94 STN 1DW1A5328RS835061 BW CO CO 98050473659
670471 TRAILER IN 94 STN 1DW1A532XRS835062 BW CO CO 98050473661
670472 TRAILER IN 94 STN 1DW1A5321RS835063 BW CO CO 98050473664
670473 TRAILER IN 94 STN 1DW1A5323RS835064 BW CO CO 98050473666
670474 TRAILER IN 94 STN 1DW1A5325RS835065 BW CO CO 98050473667
670475 TRAILER IN 94 STN 1DW1A5327RS835066 BW CO CO 98050473669
670476 TRAILER IN 94 STN 1DW1A5329RS835067 BW CO CO 98050473673
670477 TRAILER IN 94 STN 1DW1A5320RS835068 BW CO CO 98050473676
670478 TRAILER IN 94 STN 1DW1A5322RS835069 BW CO CO 98050473677
670479 TRAILER IN 94 STN 1DW1A5329RS835070 BW CO CO 98050473680
670480 TRAILER IN 94 STN 1DW1A5320RS835071 BW CO CO 98050473683
670481 TRAILER IN 94 STN 1DW1A5322RS835072 BW CO CO 98050473685
670482 TRAILER IN 94 STN 1DW1A5324RS835073 BW CO CO 98050473688
670483 TRAILER IN 94 STN 1DW1A5326RS835074 BW CO CO 98050473690
670484 TRAILER IN 94 STN 1DW1A5328RS835075 BW CO CO 98050473693
670485 TRAILER IN 94 STN 1DW1A532XRS835076 BW CO CO 98050473695
670486 TRAILER IN 94 STN 1DW1A5321RS835077 BW CO CO 98050473697
670487 TRAILER IN 94 STN 1DW1A5323RS835078 BW CO CO 98050473699
670488 TRAILER IN 94 STN 1DW1A5325RS835079 BW CO CO 98050473701
670489 TRAILER IN 94 STN 1DW1A5321RS835080 BW CO CO 98050473704
670490 TRAILER IN 94 STN 1DW1A5323RS835081 BW CO CO 98050473706
670491 TRAILER IN 94 STN 1DW1A5325RS835082 BW CO CO 98050473708
670492 TRAILER IN 94 STN 1DW1A5327RS835083 BW CO CO 98050473710
670493 TRAILER IN 94 STN 1DW1A5329RS835084 BW CO CO 98050473712
670494 TRAILER IN 94 STN 1DW1A5320RS835085 BW CO CO 98050473715
</TABLE>
<PAGE>
ALLIED VAN LINES
HHO Shuttle Fleet Trailers
Acct #123505 & 605-2810
<TABLE>
<CAPTION>
YEAR AVL # MAKE VIN #
- ---- ----- -------- -----
<S> <C> <C> <C>
1980 72847 Kentucky 60455
1980 72848 Kentucky 60450
1980 72849 Kentucky 60451
1980 72850 Kentucky 60454
</TABLE>
<PAGE>
PAGE 1
COUNT OF NAVL TITLED UNITS AS OF 10/30/99
<TABLE>
<CAPTION>
UNIT
TYPE COUNT
- ---- -----
<S> <C>
DOLLY 17
- -----------------------
ST. TRUCK 12
- -----------------------
TRACTOR 52
- -----------------------
TRAILER 2645
- -----------------------
TOTAL 2726
</TABLE>
<PAGE>
- -------------------------------------------------------------------------------
SPECIAL PRODUCTS TRAILERS & ACCUMULATED DEPRECIATION
#123505-2813 & #123605-2813
SEPTEMBER, 1999
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MODEL DATE
COUNT YEAR AVL # VIN # ACQUIRED STATE
- ----- ----- ----- ---------------------- -------- -----
<S> <C> <C> <C> <C> <C>
1 1983 63777 1KKVE4829DL000688 Mar-83 IL
2 1983 63778 1KKVE4528DL000654 Mar-83 IL
3 1985 60688 1KKVE4822FL074635 May-88 IL
4 1985 60718 1KKVE4826FL074640 May-88 IL
5 1985 60722 1KKVE4828FL074641 May-88 IL
6 1986 64590 1KKVE4824GL076131 Jul-93 IL
7 1986 64592 1KKVE4828GL076133 Jul-93 IL
8 1986 64599 1KKVE4825GL076140 Jul-93 IL
9 1986 64600 1KKVE4827GL076141 Jul-93 IL
10 1986 64601 1KKVE4829GL076142 Jul-93 IL
11 1986 64612 1KKVE4823GL076153 May-88 IL
12 1986 64621 1KKVE4824GL076162 May-88 IL
13 1986 64626 1KKVE4823GL076167 Mar-93 IL
14 1987 64680 1KKVE482XHL078144 Mar-93 IL
15 1989 71566 1KKVE4829KL083861 Feb-96 IL
16 1989 71601 1KKVE4822K1083796 Feb-96 IL
17 1989 71602 1KKVE4824KL083797 Feb-96 IL
18 1989 71603 1KKVE4826K1083798 Feb-96 IL
19 1989 71604 1KKVE4828KL083799 Feb-96 IL
20 1989 71605 1KKVE4820KL083800 Feb-96 IL
21 1989 71606 1KKVE4822KL083801 Feb-96 IL
22 1989 71607 1KKVE4824KL083802 Feb-96 IL
23 1989 71608 1KKVE4826KL083803 Feb-96 IL
24 1989 71609 1KKVE4828KL083804 Feb-96 IL
25 1989 71610 1KKVE482XKL083805 Feb-96 IL
26 1989 71611 1KKVE4821KL083806 Feb-96 IL
27 1989 71612 1KKVE4823KL083807 Feb-96 IL
28 1989 71613 1KKVE4825KL083808 Feb-96 IL
29 1989 71614 1KKVE4827KL083809 Feb-96 IL
30 1989 71615 1KKVE4823KL083810 Feb-96 IL
31 1989 71616 1KKVE4825KL083811 Feb-96 IL
32 1989 71617 1KKVE4827KL083812 Feb-96 IL
33 1989 71618 1KKVE4829KL083813 Feb-96 IL
34 1989 71619 1KKVE4820KL083814 Feb-96 IL
35 1989 71620 1KKVE4822KL083815 Feb-96 IL
36 1989 71621 1KKVE4824KL083816 Feb-96 IL
37 1989 71622 1KKVE4826KL083817 Feb-96 IL
38 1989 71623 1KKVE4828KL083818 Feb-96 IL
39 1989 71624 1KKVE482XKL083819 Feb-96 IL
40 1989 71625 1KKVE4826KL083820 Feb-96 IL
41 1989 71626 1KKVE4828KL083821 Feb-96 IL
42 1989 71627 1KKVE482XKL083822 Feb-96 IL
43 1989 71628 1KKVE4821KL083823 Feb-96 IL
44 1989 71629 1KKVE4823KL083824 Feb-96 IL
45 1989 71630 1KKVE4825KL083825 Feb-96 IL
46 1989 71631 1KKVE4827KL083826 Feb-96 IL
47 1989 71632 1KKVE4829KL083827 Feb-96 IL
48 1989 71633 1KKVE4820KL083828 Feb-96 IL
49 1989 71634 1KKVE4822KL083829 Feb-96 IL
50 1989 71635 1KKVE4829KL083830 Feb-96 IL
51 1989 71636 1KKVE4820KL083831 Feb-96 IL
52 1989 71637 1KKVE4822KL083832 Feb-96 IL
53 1989 71638 1KKVE4824KL083833 Feb-96 IL
54 1989 71639 1KKVE4826KL083834 Feb-96 IL
55 1989 71640 1KKVE4828KL083835 Feb-96 IL
56 1989 71641 1KKVE482XKL083836 Feb-96 IL
57 1989 71642 1KKVE4821KL083837 Feb-96 IL
58 1989 71643 1KKVE4823KL083838 Feb-96 IL
59 1989 71644 1KKVE4825KL083839 Feb-96 IL
60 1989 71645 1KKVE4821KL083840 Feb-96 IL
61 1989 71646 1KKVE4823KL083841 Feb-96 IL
62 1989 71647 1KKVE4825KL083842 Feb-96 IL
63 1989 71648 1KKVE4827KL083843 Feb-96 IL
64 1989 71649 1KKVE4829KL083844 Feb-96 IL
65 1989 71650 1KKVE4820KL083845 Feb-96 IL
66 1989 71651 1KKVE4822KL083846 Feb-96 IL
67 1989 71652 1KKVE4824KL083847 Feb-96 IL
68 1989 71653 1KKVE4826KL083848 Feb-96 IL
69 1989 71654 1KKVE4828KL083849 Feb-96 IL
70 1989 71655 1KKVE4824KL083850 Feb-96 IL
71 1989 71656 1KKVE4826KL083851 Feb-96 IL
72 1989 71657 1KKVE4828KL083852 Feb-96 IL
73 1989 71658 1KKVE482XKL083853 Feb-96 IL
74 1989 71659 1KKVE4821KL083854 Feb-96 IL
75 1989 71660 1KKVE4823KL083855 Feb-96 IL
76 1989 71661 1KKVE4825KL083856 Feb-96 IL
77 1989 71662 1KKVE4827KL083857 Feb-96 IL
78 1989 71663 1KKVE4829KL083858 Feb-96 IL
</TABLE>
<PAGE>
ALLIED
VAN
LINES
VEHICLES
<TABLE>
<CAPTION>
YEAR DESCRIPTION VIN# STATE
<S> <C> <C> <C>
1996 Ford/Goshen Pacer LTD - Shuttle Bus 1FDJE30H7THB51500 IL
1996 Dodge Cargo Van - 1500 Series 2B4HB15X4TK123910 IL
1998 Plymouth Voyager 2P4FH4134JR536911 IL
</TABLE>
<PAGE>
- -------------------------------------------------------------------------------
SPECIAL PRODUCTS TRAILERS & ACCUMULATED DEPRECIATION
#123505-2813 & #123605-2813
SEPTEMBER, 1999
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MODEL DATE
COUNT YEAR AVL # VIN # ACQUIRED STATE
- ----- ----- ----- ---------------------- -------- -----
<S> <C> <C> <C> <C> <C>
157 1998 73448 1KKVE5322WL112670 Apr-98 IL
158 1998 73449 1KKVE5324WL112671 Apr-98 IL
159 1998 73450 1KKVE5326WL112672 Apr-98 IL
160 1998 73451 2KKVE5328WL112673 Apr-98 IL
161 1998 61436 1KKVE5323WL113441 Apr-98 IL
162 1998 62204 1KKVE5325WL113439 Apr-98 IL
163 1998 62218 1KKVE5321WL113440 Apr-98 IL
164 1998 62202 1KKVE5323WL113438 Apr-98 IL
165 1999 62127 1KKVE532XXL115155 Mar-99 IL
- -------------------------------------------------------------------------------
165
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
</TABLE>
<PAGE>
- -------------------------------------------------------------------------------
SPECIAL PRODUCTS TRAILERS & ACCUMULATED DEPRECIATION
#123505-2813 & #123605-2813
SEPTEMBER, 1999
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MODEL DATE
COUNT YEAR AVL # VIN # ACQUIRED STATE
- ----- ----- ----- ---------------------- -------- -----
<S> <C> <C> <C> <C> <C>
79 1989 71664 1KKVE4820KL083859 Feb-96 IL
80 1989 71665 1KKVE4827KL083860 Feb-96 IL
81 1989 71667 1KKVE4820KL083862 Feb-96 IL
82 1989 71668 1KKVE4822KL083863 Feb-96 IL
83 1989 71669 1KKVE4824KL083864 Feb-96 IL
84 1989 71670 1KKVE4826KL083865 Feb-96 IL
85 1989 71671 1KKVE4828KL083866 Feb-96 IL
86 1989 71672 1KKVE482XKL083867 Feb-96 IL
87 1989 71673 1KKVE4821KL083868 Feb-96 IL
88 1989 71674 1KKVE4823KL083869 Feb-96 IL
89 1989 71675 1KKVE482XKL083870 Feb-96 IL
90 1989 71676 1KKVE4821KL083871 Feb-96 IL
91 1989 71677 1KKVE4823KL083872 Feb-96 IL
92 1989 71678 1KKVE4825KL083873 Feb-96 IL
93 1989 71679 1KKVE4827KL083874 Feb-96 IL
94 1989 71680 1KKVE4829KL083875 Feb-96 IL
95 1989 71681 1KKVE4820KL083876 Feb-96 IL
96 1989 71682 1KKVE822KL083877 Feb-96 IL
97 1989 71683 1KKVE4824KL083878 Feb-96 IL
98 1989 71684 1KKVE4826KL083879 Feb-96 IL
99 1989 71685 1KKVE4822KL083880 Feb-96 IL
100 1989 71686 1KKVE4824KL083881 Feb-96 IL
101 1989 71687 1KKVE4826KL083882 Feb-96 IL
102 1989 71688 1KKVE4828KL083883 Feb-96 IL
103 1995 72418 1KKVE4823SL101478 Jan-95 IL
104 1995 72419 1KKVE4825SL101479 Jan-95 IL
105 1995 72420 1KKVE4821SL101480 Jan-95 IL
106 1995 72421 1KKVE4823SL101481 Oct-94 IL
107 1995 72422 1KKVE4825SL101482 Nov-94 IL
108 1995 72423 1KKVE4827SL101483 Oct-94 IL
109 1995 72424 1KKVE4829SL101484 Jan-95 IL
110 1995 72425 1KKVE4820SL101485 Jan-95 IL
111 1995 72426 1KKVE4822SL101486 Oct-94 IL
112 1995 72427 1KKVE4824SL101487 Nov-94 IL
113 1995 72428 1KKVE4828SL101508 Dec-94 IL
114 1995 72429 1KKVE482XSL101509 Dec-94 IL
115 1995 72430 1KKVE4826SL101510 Dec-94 IL
116 1995 72431 1KKVE4828SL101511 Dec-94 IL
117 1995 72432 1KKVE482XSL101512 Dec-94 IL
118 1995 72433 1KKVE4824SL100730 Oct-94 IL
119 1995 72434 1KKVE4826SL100731 Oct-94 IL
120 1995 72435 1KKVE4828SL100732 Oct-94 IL
121 1995 72436 1KKVE482XSL100733 Nov-94 IL
122 1995 72437 1KKVE4821SL100734 Oct-94 IL
123 1995 72439 1KKVE4826SL101474 Nov-94 IL
124 1995 72440 1KKVE4828SL101475 Nov-94 IL
125 1995 72441 1KKVE482XSL101476 Nov-94 IL
126 1995 72442 1KKVE4821SL101477 Dec-94 IL
127 1995 72443 1KKVE4829SL101503 Dec-94 IL
128 1995 72444 1KKVEJ820SL101504 Dec-94 IL
129 1995 72445 1KKVE4822SL101505 Dec-94 IL
130 1995 72446 1KKVE4824SL101506 Dec-94 IL
131 1995 72447 1KKVE4826SL101507 Dec-94 IL
132 1995 72448 1KKVE4827SL101533 Dec-94 IL
133 1995 72449 1KKVE4829SL101534 Jan-95 IL
134 1995 72450 1KKVE4820SL101535 Jan-95 IL
135 1995 72451 1KKVE4822SL101536 Jan-95 IL
136 1995 72452 1KKVE4824SL101537 Jan-95 IL
137 1995 72453 1KKVE4820SL100725 Oct-94 IL
138 1995 72454 1KKVE4822SL100726 Nov-94 IL
139 1995 72455 1KKVE4824SL100727 Nov-94 IL
140 1995 72456 1KKVE4826SL100728 Nov-94 IL
141 1995 72457 1KKVE4828SL100729 Nov-94 IL
142 1996 73172 4FGL5320XTA964451 Sep-96 IL
143 1996 73194 4FGL53207TA967596 Sep-96 IL
144 1984 53935 1KKVE4522EL068532 Jul-97 IL
145 1993 52133 1KKVE4826PL093626 Nov-97 IL
146 1993 52225 1KKVE4828PL093627 Nov-97 IL
147 1993 62234 1KKVE482XPL093628 Nov-97 IL
148 1993 62272 1KKVE4821PL093629 Nov-97 IL
149 1993 52397 1KKVE4828PL093630 Nov-97 IL
150 1993 52506 1KKVE482XPL093631 Nov-97 IL
151 1993 52545 1KKVE4821PL093632 Nov-97 IL
152 1993 52568 1KKVE4823PL093633 Nov-97 IL
153 1993 52586 1KKVE4825PL093634 Nov-97 IL
154 1993 52680 1KKVE4827PL093635 Nov-97 IL
155 1998 73446 1KKVE5324WL112668 Apr-98 IL
156 1998 73447 1KKVE5326WL112669 Apr-98 IL
</TABLE>
<PAGE>
ALLIED VAN LINES EQUIPMENT LEASED TO AGENTS OR USED IN SHUTTLE
<TABLE>
<CAPTION>
AGENT VEH
CODE AGENT NAME AVL # VIN # TYPE LEASE # STATE
- ----- -------------------------------------- ----- ----------------- ------ ------- -----
<S> <C> <C> <C> <C> <C> <C>
11870 WILLIAM E. CONDON JR. 34011 1XKADB9X4RJ632628 KW 22278
14761 WILLIAM CLIFTON 33061 1XKWD49X1XJ815497 KW 22290 IL
20287 KEVIN T. UNDERHILL, SR. 34190 1HSRUAHR1VH417227 IHCT 22285 IL
21829 JEFFREY A. FISHER 31500 4VG7DAJK0XN231901 VOLVO 22293 IL
23098 MARC J. QUIRION 36014 2FUYDXYB7TA619346 FRTLR 22284 IL
34825 GEORGE RANSON 31318 4VG7DAJJ5XN791405 VOLVO 22292 IL
0049-0 ASTRO MOVING & STORAGE 72496 1KKVE4823SL101545 KY48F 20396 IL
0049-0 ASTRO MOVING & STORAGE CO., INC. 72707 1KKVE4828SL102299 KY48F 20432 IL
0049-0 ASTRO MOVING & STORAGE 72709 1KKVE4822SL102301 KY48F 20467 IL
0049-0 ASTRO MOVING & STORAGE 73170 4FGL5320XTA964062 FL53F 20526 IL
0049-0 ASTRO MOVING & STORAGE CO., INC. 63011 1KKVE5124WL112964 KY51F 20637 IL
0049-0 ASTRO MOVING & STORAGE CO., INC. 60935 1KKVE5123XL114349 KY51F 20655 IL
0049-0 ASTRO MOVING & STORAGE CO., INC. 62481 1KKVE5327XL115453 KY53F 20657 IL
0053-0 ASTRO LAW'S MOVING & STORAGE 63074 1KKVE5128WL112965 KY51F 20638 IL
0053-0 ASTRO LAW'S MOVING & STORAGE 60967 1KKVE512XXL114350 KY51F 20650 IL
0053-0 ASTRO LAW'S MOVING & STORAGE 71007 1KKVE5323XL115613 KY53F 20699
0053-0 ASTRO LAW'S MOVING & STORAGE 71171 1KKVE5322XL115618 KY53F 20702 IL
0065-0 AMBASSADOR MOVING & STORAGE 60894 1KKVE5121XL114348 KY51F 20654
0078-0 ASSOCIATED MOVING & STORAGE CO., INC. 72780 1KKVE5022TL108976 KY50F 20481 IL
0078-0 ASSOCIATED MOVING & STORAGE CO., INC. 72781 1KKVE5024TL105977 KY50F 20482 IL
0131-0 BURNETT MOVING & STORAGE, INC. 23890 1FV6HFAA1XMB62624 FRTST 24082
0137-0 BLOCKER TRANSFER & STORAGE CO., INC. 73372 4FGL53201VA966205 FL53F 20602 IL
0137-0 BLOCKER TRANSFER & STORAGE CO., INC. 73373 4FGL53203VA966206 FL53F 20603 IL
0422-0 CHAMPION MOVING & STORAGE, INC. 73191 4FG151207TA964444 FL51F 20667 IL
0422-0 CHAMPION MOVING & STORAGE, INC. 73177 1FG151207TA964430 FL51F 20668 IL
0510-0 A-1 ORLANDO MOVING & STORAGE, INC. 73363 1KKVE4828VL109838 KY48S 20669 IL
0510-0 A-1 ORLANDO MOVING & STORAGE, INC. 73490 4FGL51205TA964443 FL51F 20670 IL
0512-0 TREDWAYS MOVING & STORAGE, INC. 72608 1KKVE4820SL102460 KY48F 20435 IL
0561-0 DUNMAR MOVERS CHARLOTTE 73070 1KKVE5127VL108566 KY51F 20548 IL
0608-0 ELGIN WAREHOUSE & EQUIPMENT 37727 1XKWDB9X8XJ792191 KW 22291 IL
0750-0 ALL-WAYS/FISHER TRANSPORTATION, INC. 73285 1KKVE5336VL109777 KY53S 20600 IL
0750-0 ALL-WAYS/FISHER TRANSPORTATION, INC. 64242 4FGL05322XL023239 FL53F 20659 IL
0750-0 ALL-WAYS/FISHER TRANSPORTATION 34557 1FUYDSEB1YPF55955 FRTLR 22295
0750-0 ALL-WAYS/FISHER TRANSPORTATION 34574 1FUYDSEB3YPF55956 FRTLR 22296
0750-2 FISHER'S TRANSPORTATION GROUP, INC 72673 1KKVE5024SL102381 KY50F 20397 IL
0750-2 FISHER'S TRANSPORTATION GROUP, INC 72674 1KKVE5028SL102382 KY50F 20398 IL
0750-2 FISHER'S TRANSPORTATION GROUP, INC 72675 1KKVE5028SL102383 KY50F 20401 IL
0750-2 FISHER'S TRANSPORTATION GROUP, INC 72676 1KKVE502XSL102384 KY50F 20402 IL
0801-0 GATES MOVING & STORAGE, INC. 73376 4FGL53209VA966162 FL53F 20666 IL
1001-0 INTERSTATE MOVING & STORAGE CO. 72888 1KKVE532XTL106045 KY53S 20525 IL
1002-0 INLAND EMPIRE RELOCATION SERVICE 61069 1KKVE5326XL114357 KY53F 20652
1145-0 JACKSON MOVING SERVICES, L.L.C. 73300 4FGL51207VA964740 FL51F 20642 IL
1345-0 LANE'S MOVING & STORAGE, INC. 73223 1KKVE5327VL108614 KY53F 20554
1345-0 LANE'S MOVING & STORAGE, INC. 73979 1KKVE5323WL111740 KY53S 20604
1345-0 LANE'S MOVING & STORAGE, INC. 73980 1KKVE5325WL111741 KY53S 20605
1625-0 BENTON MOVING SERVICES, INC. 73334 1KKVF5332VL109840 KY53B 20547
1728-0 O'NEILL TRANSFER & STORAGE CO., INC. 38276 1XPCDB8X4SN385176 PETER 22297 IL
1728-0 O'NEILL TRANSFER CO., INC. 21662 1FV6HFAA7XMB62627 FRTST 24078
1830-0 THE MOVING COMPANY 61532 1KKVE4824RL097113 KY48F 20658 IL
1830-0 THE MOVING COMPANY 22347 1FV3HFAC8XHB62611 FRTST 24081 IL
1834-0 SIMONIK MOVING & STORAGE, INC. 72386 1KKVE5020SL102198 KY50S 20393
1834-0 SIMONIK MOVING & STORAGE, INC. 72387 1KKVE5022SL102199 KY50S 20394
1834-0 SIMONIK MOVING & STORAGE, INC. 72388 1KKVE5027SL102200 KY50S 20395
1834-0 SIMONIK MOVING & STORAGE, INC. 22362 1HTSDAAP1RH576423 IHCST 24072
2013-0 RELIABLE VAN & STORAGE CO., INC. 72469 1KKVE4821SL100247 KY48S 20385 IL
2013-0 RELIABLE VAN & STORAGE CO., INC. 72470 1KKVE4823SL100248 KY48S 20386 IL
2013-0 RELIABLE VAN & STORAGE CO. 72622 1KKVE5328TL106027 KY53S 20470 IL
2013-0 RELIABLE VAN & STORAGE CO., INC. 72711 1KKVE4826SL102303 KY48F 20473
2152-0 SOUTHWEST TRANSFER & STORAGE CO., INC. 72611 1KKVE4824SL102459 KY48F 20405
2152-0 SOUTHWEST TRANSFER & STORAGE CO., INC. 23654 1HTSDAAP5SH240215 IHCST 24076
2614-0 WESTERN VAN & STORAGE 72648 1KKVE5021SL102366 KY50S 20384 IL
</TABLE>
<PAGE>
ALLIED VAN LINES EQUIPMENT LEASED TO AGENTS OR USED IN SHUTT
<TABLE>
<CAPTION>
AGENT VEH
CODE AGENT NAME AVL # VIN # TYPE LEASE # STATE
- ----- -------------------------------------- ----- ----------------- ------ ------- -----
<S> <C> <C> <C> <C> <C> <C>
9021-0 AVL SHUTTLE FLEET 73180 4FGL51202TA964433 FL51F 20515 IL
9021-0 AVL SHUTTLE FLEET 73180 4FGL51202TA964433 FL51F 20515 IL
9021-0 AVL SHUTTLE 73280 1KKVE5320VL109765 KY53S 20572
9021-0 AVL SHUTTLE 73374 4FGL53205VA966160 FL53F 20576 IL
9021-0 AVL SHUTTLE 73185 4FGL51201TA964438 FL51F 20583 IL
</TABLE>
<PAGE>
ALLIED VAN LINES EQUIPMENT LEASED TO AGENTS OR USED IN SHUTT
<TABLE>
<CAPTION>
AGENT
CODE AGENT NAME AVL # VIN # VEH TYPE LEASE # STATE
- ------ ----------------------------------- ----- ----------------- -------- ------- -----
<S> <C> <C> <C> <C> <C> <C>
2617-0 WEST END MOVING & STORAGE CO., INC. 73458 1KKVE5325WL112680 KY53S 20646 IL
2617-0 WEST END MOVING & STORAGE CO., INC. 73459 1KKVE5327WL112681 KY53S 20647 IL
2617-0 WEST END MOVING & STORAGE CO., INC. 73462 1KKVE5322WL112684 KY53S 20648 IL
2617-0 WEST END MOVING & STORAGE CO., INC. 73464 1KKVE5328WL112686 KY53S 20649 IL
8132-0 TRANS ELECTRONICS, INC. 38677 2HSFHAER1VC075507 IHCT 22286 IL
8132-0 TRANS ELECTRONICS, INC. 36888 1KKAD69X7WJ773194 KW 22289 IL
9021-0 AVL SHUTTLE 63305 1KKVE5126XL114331 KY51F 20671
9021-0 AVL SHUTTLE 63460 1KKVE512XXL114333 KY51F 20672 IL
9021-0 AVL SHUTTLE 63588 1KKVE5121XL114334 KY51F 20673 IL
9021-0 AVL SHUTTLE 63605 1KKVE5123XL114335 KY51F 20674 IL
9021-0 AVL SHUTTLE 63660 1KKVE5125XL114336 KY51F 20675 IL
9021-0 AVL SHUTTLE 61229 1KKVE5320XL114368 KY53F 20676 IL
9021-0 AVL SHUTTLE 61332 1KKVE5321XL114394 KY53F 20677 IL
9021-0 AVL SHUTTLE 61341 1KKVE5323XL114395 KY53F 20678 IL
9021-0 AVL SHUTTLE 61387 1KKVE5323XL114400 KY53F 20679 IL
9021-0 AVL SHUTTLE 61398 1KKVE5325XL114401 KY53F 20680 IL
9021-0 AVL SHUTTLE 61400 1KKVE5329XL114403 KY53F 20681 IL
9021-0 AVL SHUTTLE 61401 1KKVE5320XL114404 KY53F 20682 IL
9021-0 AVL SHUTTLE 61706 1KKVE5122XL114438 KY51F 20683 IL
9021-0 AVL SHUTTLE 61740 1KKVE5124XL114439 KY51F 20684 IL
9021-0 AVL SHUTTLE 61760 1KKVE5120XL114440 KY51F 20685 IL
9021-0 AVL SHUTTLE 61771 1KKVE5122XL114441 KY51F 20686 IL
9021-0 AVL SHUTTLE 61775 1KKVE5124XL114442 KY51F 20687 IL
9021-0 AVL SHUTTLE 61802 1KKVE5126XL114443 KY51F 20688 IL
9021-0 AVL SHUTTLE 61824 1KKVE5128XL114444 KY51F 20689 IL
9021-0 AVL SHUTTLE 61831 1KKVE512XXL114445 KY51F 20690 IL
9021-0 AVL SHUTTLE 62345 1KKVE532XXL115477 KY53F 20691 IL
9021-0 AVL SHUTTLE 70517 1KKVE5120XL115538 KY51F 20692 IL
9021-0 AVL SHUTTLE 70520 1KKVE5122XL115539 KY51F 20693 IL
9021-0 AVL SHUTTLE 70662 1KKVE5323XL115546 KY53F 20694 IL
9021-0 AVL SHUTTLE 70667 1KKVE5325XL115547 KY53F 20695 IL
9021-0 AVL SHUTTLE 70912 1KKVE5329XL115552 KY53F 20696 IL
AGTDEV AVL AGENGY DEVELOPMENT 72610 1KKVE4822SL102458 KY48F 20471 IL
AGTDEV AVL AGENCY DEVELOPMENT 72704 1KKVE4822SL102296 KY48F 20478
AGTDEV AVL AGENCY DEVELOPMENT 72656 1KKVE4828SL102237 KY48F 20479
AGTDEV AVL AGENCY DEVELOPMENT 72714 1KKVE4821SL102306 KY48F 20480
AGTDEV AVL AGENCY DEVELOPMENT 72699 1KKVE4828SL102223 KY48F 20530 IL
AGTDEV AVL AGENCY DEVELOPMENT 72725 1KKVE4825SL102471 KY48F 20531 IL
21829 JEFFREY A. FISHER 38883 1XKADB9X0RR641327 KW 22260 IL
24688 RICHARD LOPEZ 34923 1XKADB9X0SJ646046 KW 22261
0750-0 FISHER'S MOVING & STORAGE 23354 1HTSDAAN6RH594852 IHCST 24064
1618-0 NEW ENGLAND HOUSEHOLD MVG & STG INC 23400 1HTSCACN5SH612196 IHCST 24067
2013-0 RELIABLE VAN & STORAGE CO., INC 34947 1XKADB9X2SJ646047 KW 22264 IL
99999 CHARLES SARGENT FRTLR 22186 IL
0060-0 ASTRO MOVING & STORAGE 62552 1KKVE4821RL097621 KY48S 20389 IL
0065-0 AMBASSADOR MOVING & STORAGE 72289 1KKVE4822RL097577 KY48F 20353 IL
0137-0 BLOCKER TRANSFER & STORAGE CO., 62153 1KKVE4825RL097573 KY48F 20344 IL
INC.
0137-0 BLOCKER TRANSFER & STORAGE CO., 72284 1KKVE4829RL097575 KY48F 20350 IL
INC.
0137-0 BLOCKER TRANSFER & STORAGE CO., 62231 1KKVE4827RL097574 KY48F 20351 IL
INC.
0383-0 DUNMAR MOVING SYSTEMS 73179 4FGL51200TA964432 FL51F 20532 IL
0510-0 EXCEL MOVING AND STORAGE, INC. 73183 4FGL51208TA964436 FL51F 20700 IL
1002-0 INLAND EMPIRE RELOCATION SERVICE 62032 1KKVE4829RL097110 KY48F 20330
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
2408-0 CHARLES H. CLINE 62091 1KKVE4828RL097910 KY48S 20372 IL
2516-0 VIP TRANSPORT, INC. 61601 1KKVE4828RL097907 KY48S 20342 IL
2614-0 WESTERN VAN & STORAGE 64951 1KKVE4821NL092722 KY48F 20332 IL
9021-0 ALLIED VAN LINES, INC. SHUTTLE 72330 1KKVE4824RL097886 KY48F 20368 IL
FLEET
9021-0 AVL SHUTTLE FLEET 73150 1KKVE4828TL105964 KY48F 20494
9021-0 AVL SHUTTLE FLEET 73185 4FGL51201TA964438 FL51F 20500 IL
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CUST
NO. NAME/LESSEE AVL # VIN # VEH TYPE CUST NO. LEASE # REG STATE
- ------ ------------------------------------- ----- ----------------- --------- -------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
11870 WILLIAM E. CONDON JR. 34011 1XKADB8X4ARJ632628 KW 11870 22278
14781 WILLIAM CLIFTON 33061 1XKW049X1XJ815497 KW 14781 22285 IL
20287 KEVIN T. UNDERHILL, SR. 34190 IHSRUAHR1VH417227 IHCT 20287 22285 IL
21829 JEFFREY A. FISHER 31500 4VG7DAJKOXN231901 VOLVO 21829 22285 IL
23098 MARC J. QUIRON 36014 2FUYDXYB7TAB18348 FRTLTR 23098 22284 IL
34825 GEORGE RANSON 31318 4VG7DAU5XN791405 VOLVO 34825 22292 IL
0049-0 ASTRO MOVING & STORAGE CO., INC. 60935 1KKVE5123XL114319 KY51F 0049-0 20855 IL
0049-0 ASTRO MOVING & STORAGE CO., INC. 62481 1KKVE5327XL115453 KY53F 0049-0 20857 IL
0049-0 ASTRO MOVING & STORAGE CO., INC. 63011 1KKVE5124WL112984 KY51F 0049-0 20637 IL
0049-0 ASTRO MOVING & STORAGE 24901 1KKVE5124WL112984 KY48F 0049-0 20637 IL
0049-0 ASTRO MOVING & STORAGE CO., INC. 72707 1KKVE482SL102299 KY48F 0049-0 20396 IL
0049-0 ASTRO MOVING & STORAGE 72709 1KKVE4822SL102301 KY48F 0049-0 20487 IL
0049-0 ASTRO MOVING & STORAGE 73170 4FGL5320XTA984082 FL53F 0049-0 20526 IL
0053-0 ASTRO LAW'S MOVING & STORAGE 60967 IKKVE51ZXXL114350 KY51F 0053-0 20850 IL
0053-0 ASTRO LAW'S MOVING & STORAGE 63074 IKKVE5128WL112985 KY51F 0053-0 20638
0053-0 ASTRO LAW'S MOVING & STORAGE 71007 1KKVE4821RL097821 KY48S 0053-0 20389 IL
0053-0 ASTRO LAW'S MOVING & STORAGE 71007 IKKVE532XL115618 KY53F 0053-0 20702 IL
0085-0 AMBASSADOR MOVING & STORAGE 60894 1KKVE4822RL097577 KY48F 0085-0 20654 IL
0085-0 AMBASSADOR MOVING & STORAGE 72289 1KKVE4822RL097577 KY48F 0085-0 20353 IL
0078-0 ASSOCIATED MOVING & STORAGE CO., INC. 72780 1KKVE5022TL105976 KY50F 0078-0 20481 IL
0078-0 ASSOCIATED MOVING & STORAGE CO., INC. 72781 1KKVE5024TL105977 KY50F 0078-0 20482 IL
0131-0 BURNETT MOVING & STORAGE, INC. 23890 1FV8HFAA1XH852824 FRTST 0131-0 24082
0137-0 BLOCKER TRANSFER & STORAGE CO., INC. 73372 4FGL53201VA908205 FL53F 0137-0 20802 IL
0383-0 BLOCKER TRANSFER & STORAGE CO., INC. 73373 4FGL53203VA985206 FL53F 0383-0 20803 IL
0422-0 DUMNAR MOVING SYSTEMS 73179 4FGL51200TA954432 FL51F 0422-0 20532 IL
0422-0 CHAMPION MOVING & STORAGE, INC. 73177 1FG151207TA984432 FL51F 0422-0 20888 IL
0512-0 CHAMPION MOVING & STORAGE, INC. 73191 4FG151207TA98444 FL51F 0512-0 20887 IL
0512-0 TREDWAYS MOVING & STORAGE 72608 1KKVE4820SL102480 KY48F 0512-0 20435 IL
0561-0 DUNMAR MOVERS CHARLOTTE 73070 1KKVE5127VL106566 KY51F 0561-0 20548 IL
0608-0 ELGIN WAREHOUSE & EQUIPMENT 37727 1XKWD89XBXJ792191 KW 0608-0 22291 IL
0610-0 EXCEL MOVING AND STORAGE INC 73183 4FGL51208TAB64436 FL51F 0610-0 20700 IL
0750-0 FISHER'S MOVING & STORAGE 23354 1HTSDAAN6RH594852 HCST 0750-0 24064
0750-0 ALL-WAYS/FISHER TRANSPORTATION 34557 1FUYDSEB1YPF55955 FRTLR 0750-0 22295
0750-0 ALL-WAYS/FISHER TRANSPORTATION 34574 1FUYDSEB3YPF55956 FRTLR 0750-0 22298
0750-0 ALL-WAYS/FISHER TRANSPORTATION INC 64242 4FCL053222L023229 FL53F 0750-0 20659 IL
0750-0 ALL-WAYS/FISHER TRANSPORTATION, INC 73285 1KKVE5336VL109777 KY535 0750-0 20800 IL
0750-2 FISHER'S TRANSPORTATION GROUP, INC 72673 1KKVE5024SL102381 KY50F 0750-2 20397 IL
0750-2 FISHER'S TRANSPORTATION GROUP, INC 72674 1KKVE5026SL102382 KY50F 0750-2 20398 IL
0750-2 FISHER'S TRANSPORTATION GROUP, INC 72675 1KKVE5028SL102383 KY50F 0750-2 20401 IL
0750-2 FISHER'S TRANSPORTATION GROUP, INC 72876 1KKVE502XSL102384 KY50F 0750-2 20402 IL
0801-0 GATES MOVING & STORAGE, INC 73378 4FGL53209VA965162 FL53F 0801-0 20665 IL
1001-0 INTERSTATE MOVING & STORAGE, CO 72688 1KKVE532XTL106045 KY53S 1001-0 20525 IL
1002-0 INLAND EMPIRE RELOCATION SERVICE 61069 1KKVE5326XL114357 KY53F 1002-0 20852
1002-0 INLAND EMPIRE RELOCATION SERVICE 62032 1KKVE4829RL097110 KY48F 1002-0 20330
1145-0 JACKSON MOVING SERVICES, LLC 73300 4FGL51207VA964740 FL51F 1145-0 20642 IL
1345-0 LANE'S MOVING & STORAGE, INC 73223 1KKVE5327VL106614 KY53F 1345-0 20554
1345-0 LANE'S MOVING & STORAGE, INC 73979 1KKVE5323WL111740 KY536S 1345-0 20604
1345-0 LANE'S MOVING & STORAGE, INC 73980 1KKVE532WL111741 KY53S 1345-0 20605
1618-0 NEW ENGLAND HOUSEHOLD MVG & STG INC 23400 1HTSCACNSSH612196 HCST 1618-0 24067
1625-0 BENTON MOVING SERVICES, INC 73334 1KKVF5332VL109840 KY53B 1625-0 20547
1725-0 O'NEILL TRANSFER CO INC 21852 1FV6HFAA7XH862627 FRTST 1725-0 24078
1728-0 O'NEILL TRANSFER & STORAGE CO INC 38276 1XPCDB8X4SN385178 PETER 1728-0 22297 IL
1830-0 THE MOVING COMPANY 22347 1FV3HFAC8XHB62611 FRTST 1830-0 24081 IL
1830-0 THE MOVING COMPANY 61532 1KKVE4824RL097113 KY48F 1830-0 20858 IL
1834-0 SIMONIK MOVING & STORAGE, INC 22362 1HTSOAAP1RH576423 IHCST 1834-0 24072
1834-0 SIMONIK MOVING & STORAGE, INC 72386 1KKVE5020SL102198 KY50S 1834-0 20393
1834-0 SIMONIK MOVING & STORAGE, INC 72387 1KKVE5022SL102199 KY50S 1834-0 20334
1834-0 SIMONIK MOVING & STORAGE, INC 72388 1KKVE5027SSL102200 KY50S 1834-0 20395
2013-0 RELIABLE VAN & STORAGE CO, INC 34947 1XXAD89X2SJ646047 KW 2013-0 22264 IL
2013-0 RELIABLE VAN & STORAGE CO, INC 72469 1KKVE4821SL100247 KY48S 2013-0 20385 IL
2013-0 RELIABLE VAN & STORAGE CO, INC 72470 1KKVE4823SL100248 KY48S 2013-0 20386 IL
2013-0 RELIABLE VAN & STORAGE CO 72622 1KKVE5328TL106027 KY53S 2013-0 20470 IL
2013-0 RELIABLE VAN & STORAGE CO, INC 72711 1KKVE4826SL102303 KY48F 2013-0 20473
2152-0 SOUTHWEST TRANSFER & STORAGE CO, INC 23854 1HTSDAAP5SH240215 HCST 2152-0 24076
2152-0 SOUTHWEST TRANSFER & STORAGE CO, INC 72511 1KKVE4824SL102459 KY48F 2152-0 20405
2408-0 CHARLES CLINE 62091 1KKVE4826RL097910 KY48S 2408-0 20372 IL
2516-0 VIP TRANSPORT, INC 61601 KKVE4828PCL087907 KY48S 2516-0 20342 IL
2614-0 WESTERN VAN & STORAGE 64951 1KKVE4821NL0-92722 KY48F 2614-0 20332 IL
2614-0 WESTERN VAN & STORAGE 72648 1KKVE5021SL102386 KY50S 2614-0 20384 IL
2617-0 WEST END MOVING & STORAGE CO. INC 73458 1KKVE5325WL112880 KY53S 2617-0 20846 IL
2617-0 WEST END MOVING & STORAGE CO. INC 73459 1KKVE5327WL112881 KY53S 2617-0 20847 IL
2617-0 WEST END MOVING & STORAGE CO. INC 73452 1KKVE5325WL112886 KY53S 2617-0 20849 IL
8132-0 TRANS ELECTRONICS, INC 36888 1XKAD68X7WJ773914 KW 8132-0 22289 IL
8132-0 TRANS ELECTRONICS, INC 36877 2HSFHAER1VC075507 IHCT 8132-0 22286 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61229 1KKVE5320XL114368 KY53F 9021-0 20676 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61332 1KKVE5321XL114394 KY53F 9021-0 20677 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61341 1KKVE5323XL114395 KY53F 9021-0 20678 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61387 1KKVE5323XL114400 KY53F 9021-0 20679 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61398 1KKVE5323XL114401 KY53F 9021-0 20680 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61400 1KKVE5323XL114400 KY53F 9021-0 20681 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61401 1KKVE5323XL114404 KY53F 9021-0 20882 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61708 1KKVE5122XL114438 KY51F 9021-0 20883 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61740 1KKVE5124XL114439 KY51F 9021-0 20884 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61780 1KKVE5120XL114440 KY51F 9021-0 20885 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61771 1KKVE5122XL114441 KY51F 9021-0 20686 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61775 1KKVE5124XL114442 KY51F 9021-0 20687 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61802 1KKVE5128XL114443 KY51F 9021-0 20888 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61824 1KKVE5128XL114444 KY51F 9021-0 20689 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 61831 1KKVE5128XL114445 KY51F 9021-0 20690 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 62345 1KKVE532XXL115477 KY53F 9021-0 20691 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 63305 1KKVE5126XL114331 KY51F 9021-0 20671 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 63460 1KKVE512XXL11433 KY51F 9021-0 20672 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 63588 1KKVE5121XL114334 KY51F 9021-0 20673 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 63605 1KKVE5123XL114335 KY51F 9021-0 20674 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 63660 1KKVE5121XL114336 KY51F 9021-0 20675 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 70517 1KKVE5120XL115538 KY51F 9021-0 20692 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 70520 1KKVE5122XL115539 KY51F 9021-0 20693 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 70662 1KKVE5323XL115548 KY53F 9021-0 20694 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 70667 1KKVE5323XL115547 KY53F 9021-0 20695 IL
9021-0 AVL SHUTTLE / INVENTORY RESALE 70912 1KKVE5329XL115552 KY53F 9021-0 20696 IL
9021-0 EHMKE MOVERS 73150 1KKVE4828TL105964 KY48F 9021-0 20494 IL
9021-0 WHALEN'S MOVING & STORAGE 73180 4FG51202TA964433 FL51F 9021-0 20515 IL
9021-0 INTERSTATE MOVING & STORAGE CO 73185 4FG51201TA964438 FL51F 9021-0 20500 IL
AGTDEV AVL AGENCY DEVELOPMENT / CITIZENS TRF 72610 1KKVE4822SL102458 KY48F AGTDEV 20471 IL
AGTDEV AVL AGENCY DEVELOPMENT / CITIZENS TRF 72656 1KKVE4828SL102237 KY48F AGTDEV 20479
AGTDEV AVL AGENCY DEVELOPMENT / M&L TRANSFER 72699 1KKVE4828SL102223 KY48F AGTDEV 20530 IL
AGTDEV AVL AGENCY DEVELOPMENT / CITIZENS TRF 72704 1KKVE4822SL102298 KY48F AGTDEV 20478
AGTDEV AVL AGENCY DEVELOPMENT / CITIZENS TRF 72714 1KKVE4821SL102308 KY48F AGTDEV 20480
AGTDEV AVL AGENCY DEVELOPMENT / CITIZENS TRF 72725 1KKVE4825SL102471 KY48F AGTDEV 20531 IL
</TABLE>
<PAGE>
Exhibit 10.5
================================================================================
COMMON STOCK PURCHASE WARRANT NO. 1
Dated as of November 19, 1999
for 87,480 Shares of Common Stock of
NA HOLDING CORPORATION
Expiring November 19, 2004
-------------------------------------
================================================================================
<PAGE>
Table of Contents
1. Exercise of Warrant................................................2
1.1. Manner of Exercise.........................................2
1.2. When Exercise Deemed Effected..............................3
1.3. Delivery of Stock Certificates, etc........................3
1.4. Payment of Taxes and Expenses..............................4
2. Adjustment of Common Stock Issuable upon Exercise..................4
2.1. Number of Shares; Warrant Price............................4
2.2. Stock Dividends, Subdivisions and Combinations.............4
2.3. Extraordinary Dividends and Distributions..................5
2.4. Issuance of Additional Shares of Common Stock..............5
2.5. Issuance of Warrants or Other Rights.......................6
2.6. Issuance of Convertible Securities.........................6
2.7. Superseding Adjustment.....................................7
2.8. Consolidation, Merger, Sale of Assets,
Reorganization, etc. ......................................8
2.9. Other Dilutive Events......................................9
2.10. Other Provisions Applicable to Adjustments under
this Section 2 ............................................9
3. Notice of Adjustment..............................................11
4. Notices of Corporate Action.......................................12
5. Restrictions on Transfer..........................................12
5.1. Certain Restrictions......................................12
5.2 Right of First Refusal....................................15
5.3. Drag-Along Rights.........................................16
5.4. Registration; Restrictions on Sale upon Public Offering...19
5.5. Termination of Restrictions...............................19
6. Registration and Participation Rights.............................20
7. Availability of Information.......................................20
8. Reservation of Stock, etc.........................................20
9. Ownership, Transfer and Substitution of the Warrant...............20
9.1. Ownership of Warrant......................................20
9.2 Transfer and Exchange of the Warrant......................20
i
<PAGE>
9.3. Division and Combination of the Warrant...................20
9.4. Replacement of the Warrant................................21
10. Definitions......................................................21
11. Rights of Holders................................................25
12. Notices..........................................................26
13. Amendment........................................................28
14. Successors and Assigns...........................................28
15. Third Party Beneficiary..........................................28
16. Miscellaneous....................................................28
Exhibit A Form of Subscription
Exhibit B Form of Assignment
ii
<PAGE>
THIS WARRANT AND THE SHARES OF COMMON STOCK PURCHASABLE UPON EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE AND ARE SUBJECT TO CERTAIN RESTRICTIONS ON
TRANSFERABILITY AS SET FORTH HEREIN (INCLUDING A FIRST REFUSAL RIGHT PURSUANT TO
SECTION 5.2 HEREOF) AND IN A REGISTRATION AND PARTICIPATION AGREEMENT, DATED AS
OF MARCH 30, 1998, AS AMENDED AS OF NOVEMBER 19, 1999, AS SUCH AGREEMENT MAY BE
AMENDED FROM TIME TO TIME, A COPY OF WHICH IS ON FILE AT THE OFFICES OF THE
COMPANY.
NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK PURCHASABLE UPON EXERCISE
HEREOF MAY BE SOLD OR OTHERWISE DISPOSED OF IN VIOLATION OF SUCH ACT, APPLICABLE
STATE SECURITIES LAWS, THE PROVISIONS OF THIS WARRANT OR SUCH REGISTRATION AND
PARTICIPATION AGREEMENT.
Warrant No. 1
No. of Shares of Common Stock: 87,480
NA Holding Corporation
Common Stock Purchase Warrant
Expiring November 19, 2004
New York, N.Y.
November 19, 1999
NA Holding Corporation, a Delaware corporation (the "Company"), for
value received, hereby certifies that NFC International Holdings (Netherlands
II) BV, a company organized under the laws of The Netherlands (the "Purchaser"),
or its permitted
<PAGE>
assigns, is entitled to purchase from the Company 87,480 duly authorized,
validly issued, fully paid and nonassessable shares of Common Stock, par value
$0.01 per share, of the Company (the "Common Stock") at the purchase price per
share determined pursuant to Sections 1.1 and 2 hereof, at any time or from time
to time after the date hereof, but prior to 5:00 P.M., New York City time, on
November 19, 2004, all subject to the terms, conditions and adjustments set
forth below in this Warrant.
This Warrant is the Common Stock Purchase Warrant (the "Warrant" or
"Warrants" such terms to include any other warrant issued upon transfer,
division or combination hereof or in substitution or exchange therefor),
originally issued on November 19, 1999 (the "Closing Date") in connection with
the issuance by the Company of 174,961 shares of its Common Stock as partial
payment of the purchase price under the Acquisition Agreement, dated as of
September 14, 1999, between the Company and NFC plc, a company organized under
the laws of England and Wales (the "Acquisition Agreement"). The Warrant
evidences rights to purchase 87,480 duly authorized, validly issued, fully paid
and nonassessable shares of Common Stock, par value $0.01 per share (such number
of shares of Common Stock referred to herein as the "Initial Exercise Shares"),
subject to adjustment as provided herein. Certain capitalized terms used in the
Warrant are defined in Section 10.
1. Exercise of Warrant. 1.1. Manner of Exercise. (a) The Warrant may
be exercised by the holder of the Warrant or any portion hereof (the "Holder"),
in whole or in part, during normal business hours on any Business Day by
surrender of the Warrant, with the form of subscription at the end hereof (or a
reasonable facsimile thereof) (the "Subscription Notice") duly executed by such
Holder, to the Company at its principal office (or, if such exercise shall be in
connection with an underwritten Public Offering of shares of Common Stock (or
Other Securities) subject to the Warrant, at the location at which the Company
shall have agreed to deliver the shares of Common Stock (or Other Securities)
subject to such offering), accompanied by payment, in cash or by certified or
official bank check payable to the order of the Company or by any other
reasonably acceptable form of immediately available funds, in the amount (such
amount referred to herein as the "Exercise Price") obtained by multiplying (i)
the number of shares of Common Stock (without giving effect to any adjustment
provided for in Section 2) designated in such Subscription Notice by (ii)
$400.00, and such Holder shall thereupon be entitled to receive the number of
duly authorized, validly issued, fully paid and nonassessable shares of Common
Stock (or Other Securities) determined as provided in Section 2 hereof.
2
<PAGE>
(b) In lieu of tendering the Exercise Price to the Company, the
Holder may elect to perform a "Cashless Exercise" of the Warrant, in whole or in
part, by surrendering the Warrant to the Company, with a duly executed
Subscription Notice marked "Cashless Exercise" and designating the number of
shares of Common Stock desired by the Holder out of the total for which the
Warrant is exercisable (without giving effect to any adjustments provided for in
Section 2). The Holder shall thereupon be entitled to receive the number of duly
authorized, validly issued, fully paid and nonassessable shares of Common Stock
(or Other Securities) having a value (at the Fair Market Value) that is equal to
the excess of (i) the then Fair Market Value per share of Common Stock (or Other
Securities) multiplied by the number of the shares of Common Stock (or Other
Securities) (determined as of the Business Day immediately preceding the date of
any such Subscription Notice) into which the Warrant, or portion thereof
designated by the Holder, would have been exercisable pursuant to Section 1.1(a)
upon payment of the Exercise Price by the Holder over (ii) the Exercise Price
the Holder would have been required to pay under Section 1.1(a) in respect of
such an exercise.
1.2. When Exercise Deemed Effected. Each exercise of the Warrant
shall be deemed to have been effected immediately prior to the close of business
on the Business Day on which the Warrant shall have been surrendered to the
Company as provided in Section 1.1, and at such time the person or persons in
whose name or names any certificate or certificates for shares of Common Stock
(or Other Securities) shall be issuable upon such exercise as provided in
Section 1.3 shall be deemed to have become the holder or holders of record
thereof.
1.3. Delivery of Stock Certificates, etc. As soon as practicable
after the exercise of the Warrant, in whole or in part, and in any event within
five Business Days thereafter (unless such exercise shall be in connection with
an underwritten Public Offering of shares of Common Stock (or Other Securities)
subject to the Warrant, in which event, concurrently with such exercise), the
Company at its expense (including the payment by it of any taxes applicable to
an issuer upon the issuance of shares, but excluding transfer taxes and any
other taxes imposed by law upon the Holder and subject to Section 1.4) shall
cause to be issued in the name of and delivered to the Holder or, subject to
Section 6, as such Holder (upon payment by such Holder of any applicable
transfer taxes) may direct,
(a) a certificate or certificates for the number of duly authorized,
validly issued, fully paid and nonassessable shares of Common Stock (or Other
Securities) to which such Holder shall be entitled upon such exercise plus, in
lieu of any fractional share to which such Holder would otherwise be entitled,
cash in an amount equal to the same fraction of the Fair Market Value per share
of such Common Stock (or Other Securities) on the Business Day next preceding
the date of such exercise, and
3
<PAGE>
(b) in case such exercise is in part only, a new Warrant or Warrants
of like tenor, calling in the aggregate on the face or faces thereof for the
number of shares of Common Stock equal (without giving effect to any adjustment
therein) to the number of such shares called for on the face of the Warrant
minus the number of such shares designated by the Holder upon such exercise as
provided in Section 1.1.
1.4. Payment of Taxes and Expenses. The Company shall pay all
expenses in connection with, and all taxes and other governmental charges that
may be imposed with respect to, the issuance or delivery of the Warrant and the
shares of Common Stock (or Other Securities) to which such Holder shall be
entitled upon exercise of the Warrant, unless such tax or charge is imposed by
law upon the Holder, in which case such taxes or charges shall be paid by the
Holder. The Company shall not be required, however, to pay any tax or other
charge imposed in connection with any transfer involved in the issuance of any
certificate for shares of Common Stock (or Other Securities) in any name other
than that of the Holder, and in such case the Company shall not be required to
issue or deliver any stock certificate until such tax or other charge has been
paid or it has been established to the satisfaction of the Company that no such
tax or other charge is due.
2. Adjustment of Common Stock Issuable upon Exercise. 2.1. Number of
Shares; Warrant Price. The number of shares of Common Stock which the Holder
shall be entitled to receive upon each exercise hereof shall be determined by
multiplying the number of shares of Common Stock which would otherwise (but for
any application of the provisions of this Section 2) be issuable upon such
exercise, as designated by the Holder pursuant to Section 1.1, by a fraction of
which (i) the numerator is $400.00 and (ii) the denominator is the Warrant Price
(as defined below) in effect on the date of such exercise. The "Warrant Price,"
which shall initially be $400.00 shall be adjusted and readjusted from time to
time as provided in Section 2 hereof and, as so adjusted or readjusted, shall
remain in effect until a further adjustment or readjustment thereof is required
by Section 2.
2.2. Stock Dividends, Subdivisions and Combinations. If at any time
the Company shall:
(i) issue or deliver any shares of Common Stock as a result of the
declaration or payment of a dividend of Common Stock payable in, or other
distribution to holders of Common Stock of, shares of Common Stock,
(ii) subdivide its outstanding shares of Common Stock into a larger
number of shares of Common Stock, or
(iii) combine its outstanding shares of Common Stock into a smaller
number of shares of Common Stock,
4
<PAGE>
then the Warrant Price then in effect shall be adjusted to equal (1) the Warrant
Price in effect immediately prior to such event multiplied by the number of
shares of Common Stock for which the Warrant is exercisable immediately prior to
the adjustment divided by (2) the number of shares of Common Stock which a
record holder of the same number of shares of Common Stock for which the Warrant
is exercisable immediately prior to the happening of such event would own or be
entitled to receive after the happening of such event.
2.3. Extraordinary Dividends and Distributions. If at any time the
Company shall distribute to all holders of its outstanding Common Stock
evidences of indebtedness of the Company, cash (other than a regular dividend
payable in cash out of earned surplus of the Company), or assets or securities
other than the Common Stock (any such evidences of indebtedness, cash, assets or
securities, the "Assets"), then, in each case, the Warrant Price then in effect
shall be reduced to a price determined by multiplying such Warrant Price by a
fraction,
(i) the numerator of which shall be the Fair Market Value then in
effect less the value of such Assets applicable to one share of Common
Stock, and
(ii) the denominator of which shall be such Fair Market Value.
Any adjustment required by this Section 2.3 shall be made whenever
any such distribution is made, and shall become effective on the date of
distribution retroactive to the record date for the determination of
stockholders entitled to receive such distribution, provided, however, that the
Company is not required to make an adjustment pursuant to this Section 2.3 if at
the time of such distribution the Company makes the same distribution to Holders
of Warrants as it makes to holders of Common Stock pro rata based on the number
of shares of Common Stock for which such Warrants are then exercisable.
2.4. Issuance of Additional Shares of Common Stock. (a) If at any
time after the date hereof the Company shall (except as hereinafter provided)
issue or sell any Additional Shares of Common Stock without consideration or in
exchange for consideration in an amount per Additional Share of Common Stock
less than the Fair Market Value at the time the Additional Shares of Common
Stock are issued, then the Warrant Price then in effect shall be reduced to a
price determined by multiplying such Warrant Price by a fraction,
(i) the numerator of which shall be (x) the number of shares of
Common Stock outstanding immediately prior to such issue or sale plus (y)
the number of shares of Common Stock which the aggregate consideration
received by the Com-
5
<PAGE>
pany for the total number of such Additional Shares of Common Stock so
issued or sold would purchase at the Fair Market Value, and
(ii) the denominator of which shall be the number of shares of
Common Stock outstanding immediately after such issue or sale.
(b) The provisions of paragraph (a) of this Section 2.4 shall not
apply to any issuance of Additional Shares of Common Stock for which an
adjustment is provided under Section 2.2.
2.5. Issuance of Warrants or Other Rights. If at any time after the
date hereof the Company shall take a record of holders of Common Stock for the
purpose of entitling them to receive a distribution of, or shall in any manner
(whether directly or by assumption in a merger in which the Company is the
surviving corporation) issue or sell, any warrants or other rights to subscribe
for or purchase any Additional Shares of Common Stock or any Convertible
Securities, whether or not such rights thereunder are immediately exercisable,
and the price per share for which Common Stock is issuable upon the exercise of
such warrants or other rights or upon conversion or exchange of such Convertible
Securities shall be less than the Fair Market Value in effect immediately prior
to the time of such issue or sale, then the Warrant Price shall be adjusted as
provided in Section 2.4 on the basis that the maximum number of shares of Common
Stock issuable pursuant to all such warrants or other rights or necessary to
effect the conversion or exchange of all such Convertible Securities shall be
deemed to have been issued and outstanding and the Company shall have received
all of the consideration payable therefor, if any, as of the date of the actual
issuance of such warrants or other rights. No further adjustments of the Warrant
Price shall be made upon the actual issuance of such Common Stock or of such
Convertible Securities upon exercise of such warrants or other rights or upon
the actual issuance of such Common Stock upon such conversion or exchange of
such Convertible Securities.
2.6. Issuance of Convertible Securities. If at any time the Company
shall take a record of the holders of Common Stock for the purpose of entitling
them to receive a distribution of, or shall in any manner (whether directly or
by assumption in a merger in which the Company is the surviving corporation)
issue or sell, any Convertible Securities, whether or not the rights to exchange
or convert thereunder are immediately exercisable, and the price per share for
which Common Stock is issuable upon such conversion or exchange shall be less
than the Fair Market Value in effect immediately prior to the time of such issue
or sale, then the Warrant Price shall be adjusted as provided in Section 2.4 on
the basis that the maximum number of shares of Common Stock necessary to effect
the conversion or exchange of all such Convertible Securities shall be deemed to
have been issued and outstanding and the Company shall have received all of the
consideration
6
<PAGE>
payable therefor, if any, as of the date of actual issuance of such Convertible
Securities. No adjustment of the Warrant Price shall be made under this Section
2.6 upon the issuance of any Convertible Securities which are issued pursuant to
the exercise of any warrants or other subscription or purchase rights therefor,
if any such adjustment shall previously have been made upon the issuance of such
warrants or other rights pursuant to Section 2.5. No further adjustments of the
Warrant Price shall be made upon the actual issuance of such Common Stock upon
conversion or exchange of such Convertible Securities, and, if any issuance or
sale of such Convertible Securities is made upon exercise of any warrant or
other right to subscribe for or to purchase or any warrant or other right to
purchase any such Convertible Securities for which adjustments of the Warrant
Price have been or are to be made pursuant to other provisions of this Section
2, no further adjustments of the Warrant Price shall be made by reason of such
issuance or sale.
2.7. Superseding Adjustment. If, at any time after any adjustment of
the number of shares of Common Stock for which the Warrant is exercisable shall
have been made pursuant to Section 2.5 or 2.6 as the result of any issuance of
warrants, rights or Convertible Securities,
(i) such warrants or rights, or the right of conversion or exchange
in such other Convertible Securities, shall expire, and all or a portion
of such warrants or rights, or the right of conversion or exchange with
respect to all or a portion of such other Convertible Securities, as the
case may be, shall not have been exercised, or
(ii) the consideration per share for which shares of Common Stock
are issuable pursuant to such warrants or rights, or the terms of such
other Convertible Securities, shall be increased solely by virtue of
provisions therein contained for an automatic increase in such
consideration per share upon the occurrence of a specified date or event,
then such previous adjustment shall be rescinded and annulled and the shares of
Common Stock which were deemed to have been issued by virtue of the computation
made in connection with the adjustment so rescinded and annulled shall no longer
be deemed to have been issued by virtue of such computation. Thereupon, a
recomputation shall be made of the effect of such rights or options or other
Convertible Securities effective as of the date of such previous adjustment on
the basis of
(A) treating the number of shares of Common Stock or other property,
if any, theretofore actually issued or issuable pursuant to the previous
exercise of any such warrants or rights or any such right of conversion or
exchange, as having
7
<PAGE>
been issued on the date or dates of any such exercise and for the
consideration actually received and receivable therefor, and
(B) treating any such warrants or rights or any such other
Convertible Securities which then remain outstanding as having been
granted or issued immediately after the time of such increase of the
consideration per share for which shares of Common Stock or other property
are issuable under such warrants or rights or other Convertible
Securities,
whereupon a new adjustment of the number of shares of Common Stock for which the
Warrant is then exercisable shall be made effective as of the date of such
previous adjustment, which new adjustment shall supersede the previous
adjustment so rescinded and annulled. Any reduction in the number of shares of
Common Stock for which the Warrant is exercisable as a result of this Section
2.7 shall be applied in its entirety to the number of shares of Common Stock for
which the Warrant is exercisable as of the date such new adjustment is made,
provided that no such superseding adjustment shall require the Holder to pay any
additional amounts in respect of any Warrant previously exercised or to return
any Warrant Shares (as such term is defined in Section 5.1 below).
2.8. Consolidation, Merger, Sale of Assets, Reorganization, etc. (a)
In case at any time, the Company shall be a party to any transaction (including
without limitation a merger, consolidation, sale of all or substantially all of
the Company's assets or recapitalization of the Common Stock) in which the
previously outstanding Common Stock shall be changed into or exchanged for
different securities of the Company or changed into or exchanged for common
stock or other securities of another corporation or interests in a noncorporate
entity or other property (including cash) or any combination of any of the
foregoing (each such transaction being hereinafter referred to as the
"Transaction") and the Warrant has not been exercised in full prior to the
consummation of the Transaction, lawful and adequate provisions shall be made so
that, upon the basis and terms and in the manner provided in this Section 2.8,
the Holder shall receive, in lieu of the Common Stock issuable upon exercise of
the Warrant prior to such consummation, the stock and other securities, cash and
property to which the Holder would have been entitled upon the consummation of
the Transaction if the Holder had exercised the Warrant pursuant to Section
1.1(b) immediately prior thereto, subject to adjustments as nearly equivalent as
possible to the adjustments provided for in Section 2; and following the
consummation of the Transaction, the Warrant will represent only the right to
receive any such stock, other securities, cash or property.
(b) Upon any liquidation, dissolution or winding up of the Company,
the Holder shall receive such cash or property (less the Warrant Price) which
the Holder would have been entitled to receive upon the happening of such
liquidation, dissolution or
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<PAGE>
winding up had the Warrant been exercised in full and the shares of Common Stock
in respect of such exercise issued immediately prior to the occurrence of such
liquidation, dissolution or winding-up.
2.9. Other Dilutive Events. In case any event shall occur as to
which the provisions of Section 2 are not strictly applicable but the failure to
make any adjustment would not fairly protect the exercise rights with respect to
the Warrant in accordance with the essential intent and principles of such
Section, then, in each such case, the Company shall appoint a firm of
independent certified public accountants of recognized national standing (which
may be the regular auditors of the Company), which shall give their opinion upon
the adjustment, if any, on a basis consistent with the essential intent and
principles established in Section 2, necessary to preserve, without dilution,
the exercise rights represented by the Warrant. Upon receipt of such opinion,
the Company will promptly mail a copy thereof to the Holder of the Warrant and
shall make the adjustments, if any, described therein.
2.10. Other Provisions Applicable to Adjustments under this Section
2. The following provisions shall be applicable to the making of adjustments to
the number of shares of Common Stock for which the Warrant is exercisable
provided for in this Section 2:
(a) Computation of Consideration. To the extent that any shares of
Common Stock or any Convertible Securities or any warrants or other rights to
subscribe for or purchase any shares of Common Stock or any Convertible
Securities shall be issued for cash consideration, the cash consideration
received by the Company therefor shall be the amount of the cash received by the
Company therefor, or, if such shares of Common Stock or Convertible Securities
are offered by the Company for subscription, the subscription price, or, if such
shares of Common Stock or Convertible Securities are sold to underwriters or
dealers for public offering without a subscription offering, the initial public
offering price (in any such case subtracting (A) any amounts paid or receivable
for accrued interest or accrued dividends and without taking into account (B)
any compensation, discounts or expenses paid or incurred by the Company for and
in the underwriting of, or otherwise in connection with, the issuance thereof).
To the extent that such issuance shall be for a consideration other than cash,
then, except as herein otherwise expressly provided, the amount of such
consideration shall be deemed to be fair value of such consideration at the time
of such issuance as determined in good faith by the Board of Directors of the
Company. In case any shares of Common Stock or any Convertible Securities or any
warrants or other rights to subscribe for or purchase such shares of Common
Stock or
9
<PAGE>
Convertible Securities shall be issued in connection with any merger in which
the Company issues any securities or as payment for all or part of the purchase
price for any securities, assets or businesses acquired by the Company or any of
its Subsidiaries, such shares of Common Stock or Convertible Securities, or
warrants or other rights shall, for all purposes under the Warrant, be deemed to
have been issued in exchange for consideration at least equal to, and the price
per share for which Common Stock is issuable upon the exercise of such warrants
or other rights or upon conversion or exchange of such Convertible Securities
shall be deemed at least equal to, the Fair Market Value in effect immediately
prior to the time of such issue or sale, and such issuance or sale shall not
give rise to an adjustment under this Section 2. The consideration for any
shares of Common Stock issuable pursuant to any warrants or other rights to
subscribe for or purchase the same shall be the consideration received by the
Company for issuing such warrants or other rights plus the additional
consideration payable to the Company upon exercise of such warrants or other
rights. The consideration for any shares of Common Stock issuable pursuant to
the terms of any Convertible Securities shall be the consideration, if any,
received by the Company for issuing warrants or other rights to subscribe for or
purchase such Convertible Securities, plus the consideration paid or payable to
the Company in respect of the subscription for or purchase of such Convertible
Securities, plus the additional consideration, if any, payable to the Company
upon the exercise of the right of conversion or exchange in such Convertible
Securities. In case of the issuance at any time of any shares of Common Stock or
Convertible Securities in payment or satisfaction of any dividends upon any
class of stock other than Common Stock, the Company shall be deemed to have
received for such shares of Common Stock or Convertible Securities a
consideration equal to the amount of such dividend so paid or satisfied.
(b) Computation of Asset Value. To the extent that any Assets shall
be distributed to all holders of the Company's outstanding Common Stock in cash,
the value of such Assets shall be the amount of cash so distributed, or, if such
Assets are securities offered by the Company for subscription, the subscription
price, or if such Assets are securities sold to underwriters or dealers for
public offering without a subscription offering, the initial public offering
price (in any such case adding any accrued interest or dividends but without
taking into account any compensation, discounts or expenses paid or incurred by
the Company in connection therewith). To the extent that the Company shall so
distribute Assets other than cash, except as herein otherwise expressly
provided, then the value of such Assets shall be deemed to be fair value of such
Assets at the time of such distribution as determined in good faith by the Board
of Directors of the Company.
(c) When Adjustment to Be Made. The adjustments required by this
Section 2 shall be made whenever and as often as any specified event requiring
an adjustment shall occur, except that any adjustment of the number of shares of
Common Stock for which the Warrant is exercisable that would otherwise be
required may be postponed (except in the case of a subdivision or combination of
shares of the Common Stock, as provided for in Section 2.2) up to but not beyond
the date of exercise if such adjustment either by itself or with other
adjustments not previously made adds or subtracts less than
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<PAGE>
1% of the shares of Common Stock for which the Warrant is exercisable
immediately prior to the making of such adjustment. Any adjustment representing
a change of less than such minimum amount (except as aforesaid) which is
postponed shall be carried forward and made as soon as such adjustment, together
with other adjustments required by this Section 2 and not previously made, would
result in a minimum adjustment or on the date of exercise. For the purpose of
any adjustment, any specified event shall be deemed to have occurred at the
close of business on the date of its occurrence.
(d) Fractional Interest; Rounding. In computing adjustments under
this Section 2, fractional interests in Common Stock shall be taken into account
to the nearest 1/10th of a share, and adjustments in the Warrant Price shall be
made to the nearest $.01.
(e) When Adjustment Not Required. If the Company shall take a record
of the holders of its Common Stock or Preferred Stock for the purpose of
entitling them to receive subscription or purchase rights and shall, thereafter
and before the distribution to stockholders thereof, legally abandon its plan to
deliver such subscription or purchase rights, then no adjustment shall be
required by reason of the taking of such record and any such adjustment
previously made in respect thereof shall be rescinded and annulled.
(f) Escrow of Warrant Stock. If the Holder exercises the Warrant
after any property becomes distributable by reason of the taking of any record
of the holders of Common Stock as described in this Section 2, but prior to the
occurrence of the event for which such record is taken, any shares of Common
Stock issuable upon exercise by reason of any adjustment required by this
Section 2 shall be deemed the last shares of Common Stock for which the Warrant
is exercised (notwithstanding any other provision to the contrary herein). Such
shares or other property shall be held in escrow for the Holder by the Company
to be issued to the Holder upon and to the extent that the event actually takes
place, upon payment of the Exercise Price. Notwithstanding any other provision
to the contrary herein, if the event for which such record was taken fails to
occur or is rescinded, then such escrowed shares shall be canceled by the
Company and escrowed property returned.
3. Notice of Adjustment. Whenever the number of shares of Common
Stock for which the Warrant is exercisable or the Warrant Price shall be
adjusted pursuant to Section 2, the Company shall forthwith prepare a
certificate to be executed by the chief financial officer of the Company setting
forth, in reasonable detail, the event requiring the adjustment, the method by
which the adjustment was calculated, the number of shares of Common Stock for
which the Warrant is exercisable and the Warrant Price after giving effect to
such adjustment or change. The Company shall promptly, and in any event within
fifteen days of such adjustment, cause a signed copy of such certificate to be
delivered to the Holder. The Company shall keep at the office of the Company
copies of all such cer-
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<PAGE>
tificates and cause the same to be available for inspection during normal
business hours by the Holder.
4. Notices of Corporate Action. In the event of
(a) any taking by the Company of a record of the holders of its
Common Stock or Preferred Stock for the purpose of determining the holders
thereof who are entitled to receive any dividend payable in, or other
distribution of, shares of Common Stock, or any other dividend (other than a
regular dividend payable in cash out of earned surplus of the Company) or other
distribution, or any right to subscribe for, purchase or otherwise acquire any
shares of Common Stock or any Convertible Securities, or to receive any other
right,
(b) any subdivision of outstanding shares of Common Stock into a
larger number of shares of Common Stock, or any combination of such shares into
a smaller number of shares of Common Stock,
(c) any capital reorganization of the Company, any reclassification
or recapitalization of the capital stock of the Company or any consolidation or
merger involving the Company and any other Person or any transfer of all or
substantially all the assets of the Company to any other Person, or
(d) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company,
the Company shall mail to each Holder a notice specifying (i) the date or
expected date on which any such record is to be taken for the purpose of such
dividend, distribution or right, and the amount and character of such dividend,
distribution or right, (ii) the date or expected date on which any such
subdivision, combination or issuance is to take place, and the amount of Common
Stock or Contingent Stock that shall be the subject of such subdivision,
combination or issuance and (iii) the date or expected date on which any such
reorganization, reclassification, recapitalization, consolidation, merger,
transfer, dissolution, liquidation or winding-up is to take place and the time,
if any such time is to be fixed, as of which the holders of record of Common
Stock (or Other Securities) shall be entitled to exchange their shares of Common
Stock (or Other Securities) for the securities or other property deliverable
upon such reorganization, reclassification, recapitalization, consolidation,
merger, transfer, dissolution, liquidation or winding-up. Such notice shall be
mailed at least 30 Business Days prior to the date specified in subdivisions
(i), (ii) and (iii) above.
5. Restrictions on Transfer. 5.1. Certain Restrictions. The Warrant
and all shares of Common Stock (and Other Securities) issued upon the exercise
of the War-
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<PAGE>
rant (the "Warrant Shares") shall not be Transferred other than to an Affiliate
of NFC plc, directly or indirectly, except as provided in this Section 5.
(a) Warrant Restrictive Legend. Except as otherwise permitted by
this Section 5, the Warrant shall be stamped or otherwise imprinted with a
legend in substantially the following form:
"THE WARRANT AND THE SHARES OF COMMON STOCK PURCHASABLE UPON EXERCISE
HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFERABILITY AS SET FORTH HEREIN (INCLUDING A FIRST
REFUSAL RIGHT PURSUANT TO SECTION 5 HEREOF) AND IN A REGISTRATION AND
PARTICIPATION AGREEMENT, DATED AS OF MARCH 30, 1998, AS AMENDED AS OF
NOVEMBER 19, 1999, AS SUCH AGREEMENT MAY BE AMENDED FROM TIME TO TIME, A
COPY OF WHICH IS ON FILE AT THE OFFICES OF THE SECRETARY OF NA HOLDING
CORPORATION. NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK
PURCHASABLE UPON EXERCISE HEREOF MAY BE SOLD OR OTHERWISE DISPOSED OF IN
VIOLATION OF SUCH ACT, APPLICABLE STATE SECURITIES LAWS, THE PROVISIONS OF
THIS WARRANT OR SUCH REGISTRATION AND PARTICIPATION AGREEMENT."
(b) Warrant Shares Restrictive Legend. Except as otherwise provided
in this Section 5, each certificate for Warrant Shares shall be stamped or
otherwise imprinted with a legend in substantially the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TRANSFER RESTRICTIONS (INCLUDING A RIGHT OF FIRST REFUSAL AND A HOLDBACK
AGREEMENT) SET FORTH IN A CERTAIN WARRANT, DATED NOVEMBER 19, 1999,
ORIGINALLY ISSUED BY NA HOLDING CORPORATION, AS SUCH WARRANT MAY BE
AMENDED FROM TIME TO TIME, A COPY OF WHICH IS ON FILE WITH THE SECRETARY
OF NA HOLDING CORPORATION. THE SECURITIES REPRESENTED BY THIS CERTIFICATE
ARE ENTITLED TO CERTAIN OF THE BENEFITS OF AND ARE BOUND BY THE
OBLIGATIONS SET FORTH IN A CERTAIN REGISTRATION AND PARTICIPATION
AGREEMENT, DATED AS OF MARCH 30, 1998, AS AMENDED AS OF NOVEMBER 19, 1999,
AS SUCH AGREEMENT MAY BE
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<PAGE>
AMENDED FROM TIME TO TIME, A COPY OF WHICH IS ON FILE AT THE OFFICE OF THE
SECRETARY OF NA HOLDING CORPORATION. THE HOLDER OF THIS CERTIFICATE, BY
ACCEPTANCE OF THIS CERTIFICATE, AGREES TO BE BOUND BY THE PROVISIONS OF
SUCH WARRANT AND SUCH REGISTRATION AND PARTICIPATION AGREEMENT."
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE OR FOREIGN
SECURITIES LAWS AND MAY NOT BE TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS (i) (A) SUCH DISPOSITION IS PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, (B) THE HOLDER HEREOF SHALL HAVE DELIVERED TO NA HOLDING
CORPORATION AN OPINION OF COUNSEL, WHICH OPINION AND COUNSEL SHALL BE
REASONABLY SATISFACTORY TO NA HOLDING CORPORATION, TO THE EFFECT THAT SUCH
DISPOSITION IS EXEMPT FROM THE PROVISIONS OF SECTION 5 OF SUCH ACT OR (C)
A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION, REASONABLY
SATISFACTORY TO COUNSEL FOR NA HOLDING CORPORATION, SHALL HAVE BEEN
OBTAINED WITH RESPECT TO SUCH DISPOSITION AND (ii) SUCH DISPOSITION IS
PURSUANT TO REGISTRATION UNDER ANY APPLICABLE STATE SECURITIES LAWS OR AN
EXEMPTION THEREFROM."
(c) Notice of Proposed Transfer; Opinion of Counsel. Prior to any
Transfer of any Restricted Securities that are not registered under an effective
registration statement under the Securities Act (other than a Transfer pursuant
to Rule 144 or any comparable rule under such Act), the holder of such
Restricted Securities shall give written notice (a "Transfer Notice") to the
Company of such holder's intention to effect such Transfer and shall comply in
all other respects with this Section 5.1(c). Each Transfer Notice shall describe
the manner and circumstances of the proposed Transfer in reasonable detail and
be accompanied by an opinion of counsel (which requirement may be waived by the
Company), who shall be independent of the holder proposing such Transfer (but
who may be the holder's regular outside counsel), experienced in Securities Act
matters and reasonably satisfactory to the Company, to the effect that the
proposed Transfer may be effected without registration. Subject to Section 5.2,
such holder of Restricted Securities shall thereupon be entitled to Transfer the
securities in question in accordance with the terms of the Transfer Notice. Each
Warrant or share certificate, if any, issued upon or in connection with such
Transfer shall bear the appropriate restrictive legend set forth in Section
5.1(a)
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<PAGE>
or Section 5.1(b), as the case may be, unless, in the opinion of such counsel
and of counsel to the Company, such legend is no longer required to ensure
compliance with the Securities Act.
5.2 Right of First Refusal. In the event that any holder of
Restricted Securities desires to accept an offer (which must be in writing and
for cash, be irrevocable by its terms for at least 60 days and be a bona fide
offer as determined in good faith by the Board or the Executive Committee
thereof) from any prospective purchaser to purchase the Restricted Securities at
any time owned by such holder, such holder shall give notice in writing to the
Company and Clayton, Dubilier & Rice Fund V Limited Partnership (the "CD&R
Fund") (i) designating the Restricted Securities proposed to be sold, (ii)
naming the prospective purchaser of such Restricted Securities and (iii)
specifying the price (the "Offer Price") at and terms (the "Offer Terms") upon
which such holder desires to sell the same. During the 30-day period following
receipt of such notice by the Company and the CD&R Fund (the "First Refusal
Period"), the Company shall have the right to purchase from the holder of such
Restricted Securities no less than all the Restricted Securities specified in
such notice, at the Offer Price and on the Offer Terms. The Company hereby
undertakes to use reasonable efforts to act as promptly as practicable following
receipt of such notice to determine whether it shall elect to exercise such
right. If Company fails to exercise such right within the First Refusal Period,
the CD&R Fund shall have the right to purchase no less than all the Restricted
Securities at the Offer Price and on the Offer Terms, at any time during the
period beginning on the earlier of (x) the end of the First Refusal Period and
(y) the date of receipt by the CD&R Fund of written notice that the Company has
elected not to exercise its rights under this Section 5.2 and ending 30 days
thereafter (the "Second Refusal Period"). The rights provided hereunder shall be
exercised by written notice to the holder of Restricted Securities given at any
time during the applicable period. If such right is exercised, the Company or
the CD&R Fund, as the case may be, shall deliver to the holder of Restricted
Securities a certified or bank check for the Offer Price, payable to the order
of the holder of Restricted Securities, against delivery of the certificates or
other instruments representing the Restricted Securities so purchased,
appropriately endorsed by the holder of Restricted Securities. If such right
shall not have been exercised prior to the expiration of the Second Refusal
Period, then at any time during the 30 days following the expiration of the
Second Refusal Period, the holder of Restricted Securities may sell such
Restricted Securities to (but only to) the intended purchaser named in such
holder's notice to the Company and the CD&R Fund at the Offer Price and on the
Offer Terms specified in such notice, free of all restrictions or obligations
imposed by, and free of any rights or benefits set forth in Section 5 of this
Warrant, provided that such intended purchaser shall have agreed in writing to
make and be bound by representations, warranties and covenants regarding such
purchaser's investment intentions pursuant to an instrument of assumption
satisfactory in substance and form to the Company.
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<PAGE>
5.3. Drag-Along Rights. (a) Drag-Along Notice. If the CD&R Fund intends to
effect a sale of 51% or more of its shares of Common Stock of the Company to a
Third Party Buyer and the CD&R Fund elects to exercise its rights under this
Section 5.3, the CD&R Fund shall deliver written notice (a "Drag-Along Notice")
to the holder of Restricted Securities, which notice shall (a) state (i) that
the CD&R Fund wishes to exercise its rights under this Section 5.3 with respect
to such sale, (ii) the name and address of the Third Party Buyer, (iii) the per
share amount and form of consideration the CD&R Fund proposes to receive for its
shares of Common Stock of the Company (the "Drag-Along Price") and (iv) the
terms and conditions of payment of such consideration and all other material
terms and conditions of such sale, (b) contain an offer (the "Drag-Along Offer")
to the holder of Restricted Securities by the Third Party Buyer to purchase (i)
in the case of a holder of the Warrant, the portion of the Warrant representing
a percentage of Warrant Shares equal to the percentage of the shares of Common
Stock of Company owned by the CD&R Fund that are to be sold to the Third Party
Buyer (the "Applicable Portion") and (ii) in the case of a holder of Warrant
Shares, the percentage of Warrant Shares equal to the percentage of the shares
of Common Stock of the Company owned by the CD&R Fund that are to be sold to the
Third Party Buyer (such percentage, the "Applicable Percentage") at the same
price and on and subject to the same terms and conditions offered to the CD&R
Fund and subject to Sections 5.3(b) and (c) below and (c) state the anticipated
time and place of the closing of the purchase and sale of the Applicable Portion
of the Warrant and the Applicable Percentage of the Warrant Shares (a
"Drag-Along Closing"), which (subject to such terms and conditions) shall occur
not fewer than five (5) days nor more than ninety (90) days after the date such
Drag-Along Notice is delivered, provided that if such Drag-Along Closing shall
not occur prior to the expiration of such 90-day period, the CD&R Fund shall be
entitled to deliver additional Drag-Along Notices with respect to such
Drag-Along Offer.
(b) Conditions to Drag-Along. Upon delivery of a Drag-Along Notice,
each holder of Restricted Securities shall have the obligation and the right to
(i) in the case of a holder of the Warrant and in the event
that the Drag-Along Price is less than or equal to the Exercise
Price, surrender the Warrant to the Company and receive from the
Company (x) a written confirmation of such surrender (and of the
consequent cancellation of the Warrant by the Company) to the Holder
and (y) a new Warrant calling in the aggregate on the face thereof
for the number of shares of Common Stock called for on the face of
the Warrant surrendered and canceled minus the shares of Common
Stock represented by the Applicable Portion of the Warrant,
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<PAGE>
(ii) in the case of a holder of the Warrant and in the event
that the Drag-Along Price exceeds the Exercise Price, transfer and
sell to the Third Party Buyer the Applicable Portion of the Warrant,
and in such case, receive from the Custodian (as defined below) the
total consideration, if any, for the shares represented by the
Applicable Portion of the Warrant, which consideration shall be the
Drag-Along Price reduced by the Exercise Price and multiplied by the
number of Warrant Shares represented by the Applicable Portion of
the Warrant, and thereupon receive from the Company (x) a written
confirmation of such transfer (and the consequent cancellation of
the Applicable Portion of the Warrant by the Company) to the Holder
and (y) a new Warrant calling in the aggregate on the face thereof
for the number of shares of Common Stock called for on the face of
the Warrant prior to the transfer of the Applicable Portion of the
Warrant to the Third Party Buyer minus the number of shares of
Common Stock represented by the Applicable Portion of the Warrant
and
(iii) in the case of a holder of Warrant Shares, transfer and
sell to the Third Party Buyer the Applicable Percentage of its
Warrant Shares and receive from the Custodian the total
consideration for such Warrant Shares
pursuant to the Drag-Along Offer, as the same may be modified from time to time,
provided that the CD&R Fund sells and transfers the Applicable Percentage of its
shares of Common Stock of the Company to the Third Party Buyer at the Drag-Along
Closing at the same price and on the same terms and conditions. Within 10 days
of receipt of the Drag-Along Notice, each holder of Restricted Securities shall
(x) execute and deliver to the CD&R Fund a power of attorney and a letter of
transmittal and custody agreement appointing, and in form and substance
reasonably satisfactory to, the CD&R Fund or one or more of its affiliates
designated by the CD&R Fund (the "Custodian"), the true and lawful
attorney-in-fact and custodian for the holder of Restricted Securities, with
full power of substitution, and authorizing the Custodian to take such actions
as the Custodian may deem necessary or appropriate to effect, as applicable, the
transfer, sale, surrender or cancellation of the Applicable Portion of the
Warrant and the transfer and sale of the Applicable Percentage of the Warrant
Shares to the Third Party Buyer, upon receipt of the purchase price therefor at
the Drag-Along Closing, free and clear of all security interests, liens, claims,
encumbrances, charges, options, restrictions on transfer, other than those
stated on the Warrant or the certificate for Warrant Shares, the proxies and
voting and other agreements of whatever nature, and to take such other action as
may be necessary or appropriate in connection with such sale, transfer,
surrender or cancellation, including consenting to any amendments, waivers,
modifications or supplements to the terms of the sale (provided that the CD&R
Fund also so consents, and, to the extent applicable, sells
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<PAGE>
and transfers the Applicable Percentage of its shares of Common Stock of the
Company on the same terms as so amended, waived, modified or supplemented) and
(y) deliver to the Custodian the Warrant and certificates representing the
Applicable Percentage of the Warrant Shares, together with all necessary duly
executed stock powers, provided that in no event shall any holder of Restricted
Securities be subject to any holdback or indemnification obligations in
connection with such sale without its prior written consent. The Custodian shall
hold the Warrant and the Applicable Percentage of the Warrant Shares and other
documents in trust for each holder of Restricted Securities pending completion
or abandonment of such sale. If, within 90 days after the CD&R Fund delivers the
Drag-Along Notice, the CD&R Fund has not completed the sale of the Applicable
Percentage of its shares of Common Stock of the Company to the Third Party Buyer
and another Drag-Along Notice with respect to such Drag-Along Offer has not been
sent to the holders of Restricted Securities, the Custodian shall return to such
holders of Restricted Securities the Warrant and all certificates representing
such securities and all other documents that such holders delivered in
connection with such sale. Promptly after the Drag-Along Closing, the Custodian
shall give notice thereof to each holder of Restricted Securities and shall
remit to each such holder the total consideration to which he is entitled and
shall furnish such other evidence of the completion and time of the completion
of such sale and the terms thereof as may be reasonably requested by such
holders.
(c) Remedies. Each holder of Restricted Securities acknowledges that
the CD&R Fund would be irreparably damaged in the event of a breach or a
threatened breach by such holder of any of his obligations under this Section
5.3 and each holder of Restricted Securities agrees that, in the event of a
breach or a threatened breach by such holder of any such obligation, the CD&R
Fund shall, in addition to any other rights and remedies available to it in
respect of such breach, be entitled to an injunction from a court of competent
jurisdiction (without any requirement to post bond) granting it specific
performance by such holder of his obligations under this Section 5.3. In the
event that the CD&R Fund shall file suit to enforce the covenants contained in
this Section 5.3 (or obtain any other remedy in respect of any breach thereof),
the prevailing party in the suit shall be entitled to recover, in addition to
all other damages to which it may be entitled, the costs incurred by such party
in conducting the suit, including reasonable attorney's fees and expenses. In
the event that, following a breach or a threatened breach by any holder of
Restricted Securities of the provisions of this Section 5.3, the CD&R Fund does
not obtain an injunction granting it specific performance of the such holder's
obligations under this Section 5.3 in connection with such proposed transfer,
sale, surrender or cancellation prior to the time the CD&R Fund completes the
sale of the Applicable Percentage of its shares of Common Stock of the Company
or, in its sole discretion, abandons such sale, then the Company shall have the
option (i) in the case of a holder of the Warrant, (x) to purchase all
Restricted Securities from such holder at a purchase price per share equal to
the Exercise Price, or (y) if the per share consideration payable pursuant to
the Drag-Along Offer is less than
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<PAGE>
the Exercise Price, to cancel the Warrant whereupon the Company shall send a
written confirmation of such cancellation to the holder, and (ii) in the case of
a holder of Warrant Shares, (x) to purchase all of the Warrant Shares held by
such holder at a purchase price per share equal to the price at which such
holder purchased such shares of Common Stock from the Company or, if less, the
per share consideration, if any, payable for each share pursuant to the
Drag-Along Offer.
5.4. Registration; Restrictions on Sale upon Public Offering. Each
holder of Restricted Securities agrees that, in the event that the Company files
a registration statement under the Securities Act with respect to an
underwritten public offering of any shares of its capital stock, it will not
seek to effect any public sale (including a sale under Rule 144) of the
Restricted Securities or any distribution of the Restricted Securities, other
than as part of such underwritten public offering, during the 20 days prior to
and the 180 days after the effective date of such registration statement.
5.5. Termination of Restrictions. (a) Securities Law Restrictions.
The legend requirements of Sections 5.1(a) and 5.1(b) and the restrictions
imposed by Section 5.1(c) shall terminate as to any Restricted Security (i) when
and so long as the security in question shall have been effectively registered
under the Securities Act and disposed of in accordance with the registration
statement covering such Restricted Securities, (ii) when, in the opinions of
both counsel for the holder thereof and counsel for the Company, such
restrictions are no longer required in order to insure compliance with the
Securities Act or (iii) when such securities have been beneficially owned, by a
person who has not been an affiliate of the Company for at least three months,
for a period of at least two years, all as determined under Rule 144 under the
Securities Act. Whenever any such restrictions shall terminate as to any Warrant
Shares, as soon as practicable thereafter and in any event within five days, the
holder thereof shall be entitled to receive from the Company and the Company
agrees to issue to such holder, without expense (other than transfer taxes, if
any) and at the request of the holder thereof, new securities of like tenor not
bearing the legend set forth in Section 5.1(b) hereof. Legend requirements set
forth in Sections 5.1(a) and 5.1(b) hereof shall continue in effect with respect
to other transfer restrictions set forth herein and in the Registration and
Participation Agreement for so long as such restrictions remain applicable and
thereafter the Company agrees to reissue securities not bearing any legend.
(b) Other Restrictions. The restrictions set forth in Sections 5.2
and 5.3 shall terminate in the event that a Public Offering has been
consummated. The restrictions set forth in Section 5.4 shall terminate (i) when
and so long as the Restricted Securities shall have been effectively registered
under the Securities Act and disposed of in accordance with the registration
statement covering such Restricted Securities or (ii) when such Restricted
Securities have been disposed of under Rule 144 under the Securities Act.
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<PAGE>
6. Registration and Participation Rights. The Warrant Shares are
subject to the restrictions set forth in and entitled to the benefits of the
Registration and Participation Agreement, dated as of March 30, 1998, as amended
as of November 19, 1999, between the Company and the CD&R Fund (the
"Registration and Participation Agreement").
7. Availability of Information. The Company shall supply each holder
of Warrant Shares with such information as may reasonably be necessary for such
holder to complete and file any information reporting forms presently or
hereafter required by the Commission as a condition to the availability of an
exemption from the Securities Act for the sale of any Warrant Shares.
8. Reservation of Stock, etc. The Company shall at all times reserve
and keep available, solely for issuance and delivery upon exercise of the
Warrant, the number of shares of Common Stock (or Other Securities) from time to
time issuable upon exercise of the Warrant at the time outstanding. All shares
of Common Stock (or Other Securities) shall be duly authorized and, when issued
upon such exercise, shall be validly issued and, in the case of shares, fully
paid and nonassessable.
9. Ownership, Transfer and Substitution of the Warrant. 9.1.
Ownership of Warrant. The Company may treat the Person in whose name the
Warrant, or any Warrant or Warrants issued in substitution therefor, is
registered on the register kept at the principal office of the Company as the
owner and the Holder thereof for all purposes, notwithstanding any notice to the
contrary, except that, if and when any Warrant is properly assigned in blank,
the Company may (but shall not be obligated to) treat the bearer thereof as the
owner of such Warrant for all purposes, notwithstanding any notice to the
contrary. Subject to Section 6, a Warrant, if properly assigned, may be
exercised by a new Holder without first having a new Warrant issued.
9.2 Transfer and Exchange of the Warrant. Upon the surrender of the
Warrant, properly endorsed, for registration of transfer or for exchange at the
principal office of the Company, the Company at its expense shall (subject to
compliance with Section 6, if applicable) execute and deliver to or upon the
order of the Holder thereof a new Warrant or Warrants of like tenor, in the name
of such Holder or as such Holder (upon payment by such Holder of any applicable
transfer taxes) may direct, calling in the aggregate on the face or faces
thereof for the number of shares of Common Stock called for on the face or faces
of the Warrant or Warrants so surrendered.
9.3 Division and Combination of the Warrant. Subject to compliance
with Section 6, the Warrant may be divided or combined with other Warrants upon
presentation thereof at the Office of the Company, together with a written
notice specifying the name
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<PAGE>
or names and denomination or denominations in which a new Warrant or Warrants
are to be issued, signed by Holder or by the duly appointed legal representative
thereof. Subject to compliance with Section 6 as to any transfer which may be
involved in such division or combination, the Company shall execute and deliver
a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice.
9.4 Replacement of the Warrant. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of any
Warrant and, in the case of any such loss, theft or destruction of any Warrant
held by a Person other than the Purchaser, upon delivery of indemnity reasonably
satisfactory to the Company in form and amount or, in the case of any such
mutilation, upon surrender of such Warrant for cancellation at the principal
office of the Company, the Company at its expense shall execute and deliver, in
lieu thereof, a new Warrant of like tenor.
10. Definitions. As used herein, unless the context otherwise
requires, the following terms have the following respective meanings:
Acquisition Agreement: the meaning specified in the second paragraph
of the Warrant.
Additional Shares of Common Stock: all shares (including treasury
shares) of Common Stock issued or sold by the Company after the Closing Date,
whether or not subsequently reacquired or retired by the Company, other than (i)
shares of Common Stock issued upon the exercise of the Warrant, (ii) shares
issued or sold pursuant to the exercise or conversion of options, warrants, or
convertible securities outstanding as of November 19, 1999 or (iii) shares
issued or sold pursuant to options, warrants or other Convertible Securities
issued or granted under the Company's Employee Stock Purchase Plan after
November 19, 1999, or any successor plan thereto, to the extent such shares are
issued or sold at a purchase price not less than 85% of the Fair Market Value as
of the date any such options, warrants or other Convertible Securities were
issued or granted.
Affiliate: with respect to any Person, any other Person that
directly or indirectly, through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person.
Applicable Percentage: the meaning specified in Section 5.3.
Applicable Portion: the meaning specified in Section 5.3.
Applicable Share Valuation: the annual valuation of the shares of
Common Stock of the Company performed by an independent valuation firm chosen by
the Board
21
<PAGE>
of Directors of the Company as of the last day of the last fiscal year ending
prior to the date on which the Board shall make a determination of the Fair
Market Value of the shares of Common Stock of the Company, except that, in the
case of a Board determination occurring during the fourth fiscal quarter of any
fiscal year beginning with the fourth quarter of the 1998 fiscal year, the term
"Applicable Share Valuation" shall mean the annual valuation of the shares of
Common Stock of the Company performed by an independent valuation firm chosen by
the Board as of the last day of such fourth fiscal quarter. Such annual
valuations shall be performed for the 1999 fiscal year and for each fiscal year
ending thereafter and prior to any initial Public Offering as promptly as
practicable following the end of each such fiscal year.
Assets: the meaning specified in Section 2.3.
Beneficially Own: with respect to any securities shall mean having
"beneficial ownership" of such securities (as determined pursuant to Rule 13d-3
under the Exchange Act), including pursuant to any agreement, arrangement or
understanding, whether or not in writing.
Business Day: a day other than a Saturday or Sunday or other day on
which commercial banking institutions in the City of New York are authorized by
law to be closed.
CD&R Fund: Clayton, Dubilier & Rice Fund V Limited Partnership, a
Cayman Islands exempted limited partnership (together with any successor
investment vehicle managed by Clayton, Dubilier & Rice, Inc.).
Closing Date: the meaning specified in the second paragraph of the
Warrant.
Commission: the Securities and Exchange Commission or any other
Federal agency at the time administering the Securities Act or the Exchange Act,
whichever is the relevant statute for the particular purpose.
Common Stock: the Company's Common Stock, as constituted on the date
hereof, any stock into which such Common Stock shall have been changed or any
stock resulting from any reclassification of such Common Stock, and all other
stock of any class or classes (however designated) of the Company the holders of
which have the right, without limitation as to amount, either to all or to a
share of the balance of current dividends and liquidating dividends after the
payment of dividends and distributions on any shares entitled to preference.
22
<PAGE>
Company: the meaning specified in the first paragraph of the
Warrant.
Convertible Securities: any evidences of indebtedness, shares of
stock (other than Common Stock) or other securities directly or indirectly
convertible into or exchangeable for Additional Shares of Common Stock.
Drag-Along Closing: the meaning specified in Section 5.3.
Drag-Along Notice: the meaning specified in Section 5.3.
Drag-Along Offer: the meaning specified in Section 5.3.
Drag-Along Price: the meaning specified in Section 5.3.
Exchange Act: the Securities Exchange Act of 1934, as amended, or
any successor Federal statute and the rules and regulations thereunder, which
shall be in effect at the time. Any reference to a particular section of the
Securities Exchange Act of 1934 shall include a reference to the corresponding
section, if any, of any such successor statute.
Exercise Price: the meaning specified in Section 1.1.
Fair Market Value: as of any date, the fair market value on such
date of a share of Common Stock as determined in good faith by the Board. In
making a determination of Fair Market Value, the Board shall give due
consideration to such factors as it deems appropriate, including, without
limitation, the earnings and certain other financial and operating information
of Holding and the Subsidiaries in recent periods, the potential value of
Holding and the Subsidiaries as a whole, the future prospects of Holding and the
Subsidiaries and the industries in which they compete, the history and
management of Holding and the Subsidiaries, the general condition of the
securities markets, the fair market value of securities of companies engaged in
businesses similar to those of Holding and the Subsidiaries and the Applicable
Share Valuation. The determination of Fair Market Value will not give effect to
any restrictions on transfer of the shares of Common Stock or the fact that such
Common Stock would represent a minority interest in Holding. Notwithstanding the
foregoing, following a Public Offering, Fair Market Value shall mean the average
of the high and low trading prices for a share of Common Stock on the primary
national exchange (including NASDAQ) on which the Common Stock is then traded on
the trading day immediately preceding the date as of which such Fair Market
Value is determined.
First Refusal Period: the meaning specified in Section 5.2.
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<PAGE>
Holder: the meaning specified in Section 1.1.
Initial Exercise Shares: the meaning specified in the opening
paragraphs of the Warrant.
NASD: the National Association of Securities Dealers, Inc.
Offer Price: the meaning specified in Section 5.2.
Offer Terms: the meaning specified in Section 5.2.
Other Securities: any stock (other than Common Stock) and other
securities of the Company or any other Person (corporate or otherwise) which the
Holder at any time shall be entitled to receive, or shall have received, upon
the exercise of the Warrant, in lieu of or in addition to Common Stock, or which
at any time shall be issuable or shall have been issued in exchange for or in
replacement of Common Stock or other securities pursuant to Section 2.8 or
otherwise.
Person: an individual, a partnership, a limited liability company,
an association, a joint venture, a corporation, a business, a trust, an
unincorporated organization or a government or any department, agency or
subdivision thereof.
Preferred Stock: the shares of preferred stock of the Company, par
value $.001 per share.
Public Offering: any underwritten public offering of Common Stock
led by one or more underwriters at least one of which is of nationally
recognized standing pursuant to an effective registration statement under the
Securities Act.
Purchaser: the meaning specified in the first paragraph of the
Warrant.
Registration and Participation Agreement: the meaning specified in
Section 6.
Restricted Securities: (i) any Warrants bearing the applicable
legend set forth in Section 5.1(a), (ii) any shares of Common Stock (or Other
Securities) which have been issued upon the exercise of Warrants and which are
evidenced by a certificate or certificates bearing the applicable legend set
forth in Section 5.1(b), and (iii) unless the context otherwise requires, any
shares of Common Stock (or Other Securities) which are at the time issuable upon
the exercise of the Warrants and which, when so issued, shall be
24
<PAGE>
evidenced by a certificate or certificates bearing the applicable legend set
forth in Section 5.1(b).
Second Refusal Period: the meaning specified in Section 5.2.
Securities Act: the Securities Act of 1933, as amended, or any
successor Federal statute, and the rules and regulations thereunder, which shall
be in effect at the time. Any reference to a particular section of the
Securities Act of 1933 shall include a reference to the corresponding section,
if any, of any such successor statute.
Subsidiary: as to any Person, any corporation at least a majority of
the shares of stock of which having general voting power under ordinary
circumstances to elect a majority of the Board of Directors of such corporation
(irrespective of whether or not at the time stock of any other class or classes
shall have or might have voting power by reason of the happening of any
contingency) is, at the time as of which the determination is being made, owned
by such Person, or one or more of its Subsidiaries or by such Person and one or
more of its Subsidiaries.
Third Party Buyer: any Person who is not an Affiliate of the CD&R
Fund and who does not own shares of common stock in a company (other than the
Company) in which an investment fund managed by Clayton, Dubilier & Rice, Inc.
has made an investment.
Transaction: the meaning specified in Section 2.8.
Transfer: unless the context otherwise requires, any sale,
assignment, pledge or other disposition of any security, or of any interest
therein, which could constitute a "sale" as that term is defined in Section 2(3)
of the Securities Act.
Transfer Notice: the meaning specified in Section 5.1.
Warrant: the meaning specified in the second paragraph of the
Warrant.
Warrant Price: the meaning specified in Section 2.1.
Warrant Shares: the shares of Common Stock (and Other Securities)
issuable upon exercise of the Warrant.
11. Rights of Holders. Except as otherwise specifically required
herein, holders of unexercised Warrants are not entitled (i) to receive
dividends or other distributions, (ii) to receive notice of or vote at any
meeting of the stockholders of the Company,
25
<PAGE>
(iii) to consent to any action of the stockholders of the Company, (iv) to
receive notice of any other proceedings of the Company or (v) to exercise any
other rights as stockholders of the Company.
12. Notices. All notices, requests, demands, waivers and other
communications required or permitted to be given under the Warrant, except
notices of the exercise of any Warrant (which shall be effected in the manner
provided in Section 1), shall be deemed to have been duly given if (a) delivered
personally, (b) mailed, certified or registered mail with postage prepaid, (c)
sent by next-day or overnight mail or delivery or (d) sent by telecopy or
telegram (with telephone confirmation), as follows:
(a) if to the Purchaser, to it at:
NFC International Holdings (Netherlands II) BV
Overschieseweg 323
3112 NC Schiedam
The Netherlands
Attention: Company Secretary of NFC p/c
(b) if to NFC plc, to it at:
NFC plc
66 Chiltern Street
London WIN 3LT
England
Attention: Company Secretary
With copies to:
Kirkland & Ellis
Citicorp Centre
153 East 53rd Street
New York, NY 10022
Fax: 212-446-4900
Tel: 212-446-4940
Attention: Kirk A. Radke
and
26
<PAGE>
Ashurst Morris Crisp
Broadwalk House
5 Appold Street
London England EC2A 2HA
Fax: (44 171) 972-7990
Tel: (44 171) 972-7710
Attention: Geoffrey Green
(c) if to any other Holder or any holder of any Common Stock (or
Other Securities), at the registered address of such Holder as set
forth in the register kept at the principal office of the Company,
(d) if to the Company, to it at:
NA Holding Corporation
c/o North American Van Lines, Inc.
5001 U.S. HWY 30 West
P.O. Box 988
Ft. Wayne, Indiana, 46801-0988
Fax: 219-429-3135
Tel: 219-429-2511
Attention: General Counsel
with a copy to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Fax: 212-909-6836
Tel: 212-909-6000
Attention: Paul S. Bird
(e) if to the CD&R Fund, to it at:
Clayton, Dubilier & Rice Fund V
Limited Partnership
1403 Foulk Road, Suite 106
Wilmington, Delaware 19803
27
<PAGE>
Attention: General Partner
with a copy to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Fax: 212-909-6836
Tel: 212-909-6000
Attention: Paul S. Bird
13. Amendment. The Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought.
14. Successors and Assigns. All agreements of the Company and the
Purchaser in this Warrant shall bind each of their respective successors and
assigns.
15. Third Party Beneficiary. It is expressly agreed that the CD&R
Fund is a third party beneficiary of Sections 5.1, 5.2, 5.3, 5.4, 5.5 and 6.
16. Miscellaneous. The section headings in the Warrant are for
purposes of convenience only and shall not constitute a part hereof. THE WARRANT
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ITS PRINCIPLES OR RULES OF
CONFLICT OF LAWS TO THE EXTENT SUCH PRINCIPLES OR RULES WOULD REQUIRE OR PERMIT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION).
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<PAGE>
NA Holding Corporation
By: /s/R. Barry Uber
--------------------------------------------
Name: R. Barry Uber
Title: President and Chief Executive Officer
<PAGE>
FORM OF SUBSCRIPTION
(To be executed only upon exercise of Warrant)
To: NA Holding Corporation
The undersigned registered holder of the within Warrant hereby
irrevocably exercises such Warrant for, and purchases thereunder, ________*
shares of Common Stock of NA Holding Corporation, and herewith makes payment [of
$ ]** [by application, pursuant to Section 1.1(b) of such Warrant, of [a portion
of] the Warrant representing a right to purchase ________* shares of Common
Stock],*** and requests that the certificates for such shares be issued in the
name of, and delivered to ______________ whose address is __________.
Dated: ______________
NFC International Holdings
(Netherlands II) BV****
[Address]
By __________________________
Name:
* Title:
- ----------
* Insert here the number of shares called for on the face of the Warrant
(or, in the case of a partial exercise, the portion thereof as to which
the Warrant is being exercised), in either case without making any
adjustment for additional Common Stock or any other stock or other
securities or property or cash which, pursuant to the adjustment
provisions of the Warrant, may be delivered upon exercise. In the case of
a partial exercise, a new Warrant or Warrants shall be issued and
delivered, representing the unexercised portion of the Warrant, to the
holder surrendering the same.
** Delete inapplicable language in brackets.
*** Delete inapplicable language in brackets.
**** Signature must conform in all respects to name of holder as specified on
the face of the Warrant.
<PAGE>
FORM OF ASSIGNMENT
(To be executed only upon transfer of Warrant)
For value received, the undersigned registered holder of the within
Warrant hereby sells, assigns and transfers unto ________________ the right
represented by such Warrant to purchase ______ shares of Common Stock of NA
Holding Corporation to which such Warrant relates, and appoints ___________
Attorney to make such transfer on the books of NA Holding Corporation maintained
for such purpose, with full power of substitution in the premises.
Dated: ______________
NFC International Holdings
(Netherlands II) BV*
[Address]
By /s/
-----------------------------
Name:
Title:
Signed in the presence of:
- --------------------------
- ----------
* Signature must conform in all respects to name of holder as specified on
the face of the Warrant.
<PAGE>
EXHIBIT 10.6
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT, dated as of March 30, 1998, among NA Holding
Corporation, a Delaware corporation ("Holding"), NA Acquisition Corporation, a
Delaware corporation ("NA Acquisition"), North American Van Lines, Inc., a
Delaware corporation (the "Company"), Clayton, Dubilier & Rice, Inc., a Delaware
corporation ("CD&R"), and Clayton, Dubilier & Rice Fund V Limited Partnership, a
Cayman Islands exempted limited partnership (together with any other investment
vehicle managed by CD&R, the "CD&R Fund"). Capitalized terms used herein and not
otherwise defined shall have the meanings set forth in Section 1 of this
Agreement.
W I T N E S S E T H :
WHEREAS, the CD&R Fund is managed by CD&R, and the general partner of the
CD&R Fund is Clayton, Dubilier & Rice Associates V Limited Partnership, a Cayman
Islands exempted limited partnership (together with any general partner of any
other investment vehicle managed by CD&R, "CD&R Associates") and the general
partner of CD&R Associates is CD&R Investment Associates, Inc., a Delaware
corporation (together with any other general partner of CD&R Associates,
"Associates Inc.");
WHEREAS, CD&R has organized Holding and NA Acquisition to acquire all of
the outstanding shares of capital stock of the Company from Norfolk Southern
Corporation, a Virginia corporation ("Norfolk Southern"), pursuant to a certain
Stock Purchase Agreement, (as amended from time to time, the "Stock Purchase
Agreement") between NA Acquisition and Norfolk Southern and a certain Preferred
Shares Stock Purchase Agreement, dated as of January 9, 1998, between NA
Acquisition and J.P. Morgan Ventures Corporation, a Delaware corporation ("J.P.
Morgan Ventures") (such transactions being hereinafter referred to as the
"Acquisition");
WHEREAS, for the purpose of financing the Acquisition, Holding is
offering, issuing and selling (i) an aggregate of up to 650,000 shares of its
Common Stock, par value $.01 per share (the "Common Stock"), to the CD&R Fund
and (ii) up to an aggregate of up to 43,500 shares of Common Stock to certain
purchasers who currently are executive officers or key employees of Holding, the
Company or one of its subsidiaries, (such transactions collectively, the "Equity
Offering");
<PAGE>
WHEREAS, for the purpose of financing the Acquisition, NA Acquisition will
enter into a Credit Agreement (the "Credit Agreement"), dated as of March 30,
1998, with the several banks and other financial institutions from time to time
parties thereto (the "Lenders"), The Chase Bank Manhattan Bank as collateral,
documentation and administrative agent for the Lenders thereunder (the
"Administrative Agent") and The Bank of New York as syndication agent (the
transactions contemplated thereby being hereinafter referred to as the
"Financing");
WHEREAS, at the closing of the Financing, NA Acquisition will make certain
borrowings pursuant to the Credit Agreement;
WHEREAS, at the closing of the Financing, the Company will assume certain
rights and liabilities of NA Acquisition as successor in interest under the
Credit Agreement pursuant to an Assumption Agreement (the "Assumption
Agreement"), including the right to make borrowings and to obtain letters of
credit under the Credit Agreement;
WHEREAS, in connection with the Financing, Holding and the Company will,
among other things, guarantee certain obligations of NA Acquisition pursuant to
a guarantee and collateral agreement (the "Guarantee and Collateral Agreement")
and enter into other security arrangements in connection with the Financing;
WHEREAS, at the closing of the Acquisition, it is contemplated that NA
Acquisition will be merged with and into the Company (the "Merger"), leaving the
Company as the surviving entity and a wholly-owned subsidiary of Holding;
WHEREAS, the CD&R Fund will purchase capital stock of Holding pursuant to
the Equity Offering, becoming the majority stockholder of Holding;
WHEREAS, Holding, the Company, NA Acquisition or one or more of their
respective Subsidiaries (as hereinafter defined) from time to time in the future
(a) may offer and sell or cause to be offered and sold equity or debt securities
(such offerings, together with the Equity Offering, being hereinafter referred
to as the "Securities Offerings"), including without limitation (i) offerings of
shares of capital stock of Holding and/or options to purchase such shares to
employees, directors, managers and consultants of and to Holding, the Company,
NA Acquisition or any Subsidiary (a "Management Offering"), and (ii) one or more
offerings of debt securities for the purpose of refinancing any indebtedness of
Holding, the Company, NA Acquisition or any Subsidiary or for other corporate
purposes, and (b) may repurchase, redeem or otherwise acquire certain securities
of Holding, the Company, NA Acquisition or one or more of their respective
Subsidiaries (any such repurchase or redemption being referred to herein as a
"Redemption");
2
<PAGE>
WHEREAS, the parties hereto recognize the possibility that claims might be
made against and liabilities incurred by CD&R, the CD&R Fund, CD&R Associates,
Associates Inc. or related persons or affiliates under applicable securities
laws or otherwise in connection with the Transactions or the Securities
Offerings, or relating to other actions or omissions of or by Holding, NA
Acquisition or the Company, or relating to the provision by CD&R of management
consulting, monitoring and financial advisory services to Holding, NA
Acquisition and the Company, and the parties hereto accordingly wish to provide
for CD&R, the CD&R Fund, CD&R Associates, Associates Inc. and related persons
and affiliates to be indemnified in respect of any such claims and liabilities;
and
WHEREAS, the parties hereto recognize that claims might be made against
and liabilities incurred by directors and officers of Holding, NA Acquisition,
the Company and any Subsidiary in connection with their acting in such capacity,
and accordingly wish to provide for such directors and officers to be
indemnified to the fullest extent permitted by law in respect of any such claims
and liabilities;
NOW, THEREFORE, in consideration of the foregoing premises, and the mutual
agreements and covenants and provisions herein set forth, the parties hereto
hereby agree as follows:
1. Definitions.
(a) "Claim" means, with respect to any Indemnitee, any claim against such
Indemnitee involving any Obligation with respect to which such Indemnitee may be
entitled to be defended and indemnified by Holding, the Company or NA
Acquisition under this Agreement.
(b) "Consulting Agreement" means the Consulting Agreement, dated as of
March 30, 1998, among Holding, the Company and CD&R, as the same may be amended,
waived, modified or supplemented from time to time.
(c) "Indemnitee" means each of CD&R, the CD&R Fund, CD&R Associates Inc.,
and their respective directors, officers, partners, employees, agents, advisors,
representatives and controlling persons (within the meaning of the Securities
Act of 1933, as amended (the "Securities Act")) and each other person who is or
becomes a director or an officer of Holding, the Company, NA Acquisition or any
Subsidiary.
(d) "Obligations" means, collectively, any and all claims, obligations,
liabilities, causes of actions, actions, suits, proceedings, investigations,
judgments, decrees, losses,
3
<PAGE>
damages, fees, costs and expenses (including without limitation interest,
penalties and fees and disbursements of attorneys, accountants, investment
bankers and other professional advisors), in each case whether incurred, arising
or existing with respect to third parties or otherwise at any time or from time
to time.
(e) "Related Document" means any agreement, certificate, instrument or
other document to which Holding, the Company, NA Acquisition or any Subsidiary
may be a party or by which it or any of its properties or assets may be bound or
affected from time to time relating in any way to the Transactions or any
Securities Offering or any of the transactions contemplated thereby, including
without limitation, in each case as the same may be amended, modified, waived or
supplemented from time to time, (A) any registration statement filed by or on
behalf of Holding, the Company, NA Acquisition or any Subsidiary with the
Securities and Exchange Commission (the "Commission") in connection with the
Transactions or any Securities Offering, including all exhibits, financial
statements and schedules appended thereto, and any submissions to the Commission
in connection therewith, (B) any prospectus, preliminary or otherwise, included
in such registration statements or otherwise filed by or on behalf of Holding,
the Company, NA Acquisition or any Subsidiary in connection with the
Transactions or any Securities Offering or used to offer or confirm sales of
their respective securities in any Securities Offering, (C) any private
placement or offering memorandum or circular, or other information or materials
distributed by or on behalf of Holding, the Company, NA Acquisition or any
Subsidiary or any placement agent or underwriter in connection with the
Transactions or any Securities Offering, (D) any federal, state or foreign
securities law or other governmental or regulatory filings or applications made
in connection with any Securities Offering, the Transactions or any of the
transactions contemplated thereby, (E) any underwriting, subscription, purchase,
option or registration rights agreement or plan entered into or adopted by
Holding, the Company, NA Acquisition or any Subsidiary in connection with any
Securities Offering or (F) any purchase, repurchase, redemption or other
agreement entered into by Holding, the Company, NA Acquisition or any Subsidiary
in connection with any Redemption.
(f) "Subsidiary" means each corporation or other person or entity in which
Holding, the Company or NA Acquisition owns or controls, directly or indirectly,
capital stock or other equity interests representing at least 25% of the
outstanding voting stock or other equity interests.
(g) "Transactions" means the Acquisition, the Merger and the Financing.
2. Indemnification.
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(a) Each of Holding, the Company and NA Acquisition (each an "Indemnifying
Party" and collectively, the "Indemnifying Parties"), jointly and severally,
agrees to indemnify, defend and hold harmless each Indemnitee:
(i) from and against any and all Obligations, whether incurred with
respect to third parties or otherwise, in any way resulting from, arising
out of or in connection with, based upon or relating to (A) the Securities
Act, the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
or any other applicable securities or other laws, in connection with any
Securities Offering, the Financing, any Related Document or any of the
transactions contemplated thereby, (B) any other action or failure to act
of Holding, the Company, NA Acquisition or any Subsidiary or any of their
predecessors, whether such action or failure has occurred or is yet to
occur or (C) except to the extent that any such Obligation is found in a
final judgment by a court of competent jurisdiction to have resulted from
the gross negligence or intentional misconduct of CD&R, the performance by
CD&R of management consulting, monitoring, financial advisory or other
services for Holding, the Company or NA Acquisition (whether pursuant to
the Consulting Agreement or otherwise); and
(ii) to the fullest extent permitted by Delaware law, from and
against any and all Obligations in any way resulting from, arising out of
or in connection with, based upon or relating to (A) the fact that such
Indemnitee is or was a director or an officer of Holding, the Company, NA
Acquisition or any Subsidiary, as the case may be, or is or was serving at
the request of such corporation as a director, officer, employee or agent
of or advisor or consultant to another corporation, partnership, joint
venture, trust or other enterprise or (B) any breach or alleged breach by
such Indemnitee of his or her fiduciary duty as a director or an officer
of Holding, the Company, NA Acquisition or any Subsidiary, as the case may
be;
in each case including but not limited to any and all fees, costs and expenses
(including without limitation fees and disbursements of attorneys) incurred by
or on behalf of any Indemnitee in asserting, exercising or enforcing any of its
rights, powers, privileges or remedies in respect of this Agreement or the
Consulting Agreement.
(b) Without in any way limiting the foregoing Section 2(a), each of the
Indemnifying Parties agrees, jointly and severally, to indemnify, defend and
hold harmless each Indemnitee from and against any and all Obligations resulting
from, arising out of or in connection with, based upon or relating to
liabilities under the Securities Act, the Exchange Act or any other applicable
securities or other laws, rules or regulations in connection with (i) the
inaccuracy or breach of or default under any representation, warranty, covenant
or agreement in any Related
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Document, (ii) any untrue statement or alleged untrue statement of a material
fact contained in any Related Document or (iii) any omission or alleged omission
to state in any Related Document a material fact required to be stated therein
or necessary to make the statements therein not misleading. Notwithstanding the
foregoing, the Indemnifying Parties shall not be obligated to indemnify such
Indemnitee from and against any such Obligation to the extent that such
Obligation arises out of or is based upon an untrue statement or omission made
in such Related Document in reliance upon and in conformity with written
information furnished to Holding, the Company or NA Acquisition, as the case may
be, in an instrument duly executed by such Indemnitee and specifically stating
that it is for use in the preparation of such Related Document.
3. Contribution.
(a) Except to the extent that Section 3(b) is applicable, if for any
reason the indemnity provided for in Section 2(a) is unavailable or is
insufficient to hold harmless any Indemnitee from any of the Obligations covered
by such indemnity, then the Indemnifying Parties, jointly and severally, shall
contribute to the amount paid or payable by such Indemnitee as a result of such
Obligation in such proportion as is appropriate to reflect (i) the relative
fault of each of Holding, the Company, NA Acquisition and their Subsidiaries, on
the one hand, and such Indemnitee, on the other, in connection with the state of
facts giving rise to such Obligation, (ii) if such Obligation results from,
arises out of, is based upon or relates to the Transactions or any Securities
Offering, the relative benefits received by each of Holding, the Company, NA
Acquisition and their Subsidiaries, on the one hand, and such Indemnitee, on the
other, from such Transaction or Securities Offering and (iii) if required by
applicable law, any other relevant equitable considerations.
(b) If for any reason the indemnity specifically provided for in Section
2(b) is unavailable or is insufficient to hold harmless any Indemnitee from any
of the Obligations covered by such indemnity, then the Indemnifying Parties,
jointly and severally, shall contribute to the amount paid or payable by such
Indemnitee as a result of such Obligation in such proportion as is appropriate
to reflect (i) the relative fault of each of Holding, the Company, NA
Acquisition and their Subsidiaries, on the one hand, and such Indemnitee, on the
other, in connection with the information contained in or omitted from any
Related Document, which inclusion or omission resulted in the inaccuracy or
breach of or default under any representation, warranty, covenant or agreement
therein, or which information is or is alleged to be untrue, required to be
stated therein or necessary to make the statements therein not misleading, (ii)
the relative benefits received by Holding, the Company, NA Acquisition and their
Subsidiaries, on the one hand, and such Indemnitee, on the other, from
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<PAGE>
such Transaction or Securities Offering and (iii) if required by applicable law,
any other relevant equitable considerations.
(c) For purposes of Section 3(a), the relative fault of each of Holding,
the Company, NA Acquisition and their Subsidiaries, on the one hand, and of the
Indemnitee, on the other, shall be determined by reference to, among other
things, their respective relative intent, knowledge, access to information and
opportunity to correct the state of facts giving rise to such Obligation. For
purposes of Section 3(b), the relative fault of each of Holding, the Company, NA
Acquisition and their Subsidiaries, on the one hand, and of the Indemnitee, on
the other, shall be determined by reference to, among other things, (i) whether
the included or omitted information relates to information supplied by Holding,
the Company, NA Acquisition and their Subsidiaries, on the one hand, or by such
Indemnitee, on the other, and (ii) their respective relative intent, knowledge,
access to information and opportunity to correct such inaccuracy, breach,
default, untrue or alleged untrue statement, or omission or alleged omission.
For purposes of Section 3(a) or 3(b), the relative benefits received by each of
Holding, the Company, NA Acquisition and their Subsidiaries, on the one hand,
and the Indemnitee, on the other, shall be determined by weighing the direct
monetary proceeds to Holding, the Company, NA Acquisition and their
Subsidiaries, on the one hand, and such Indemnitee, on the other, from such
Transaction or Securities Offering.
(d) The parties hereto acknowledge and agree that it would not be just and
equitable if contributions pursuant to Section 3(a) or 3(b) were determined by
pro rata allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in such respective Section. The
Indemnifying Parties shall not be liable under Section 3(a) or 3(b), as
applicable, for contribution to the amount paid or payable by any Indemnitee
except to the extent and under such circumstances the Indemnifying Parties would
have been liable to indemnify, defend and hold harmless such Indemnitee under
the corresponding Section 2(a) or 2(b), as applicable, if such indemnity were
enforceable under applicable law. No Indemnitee shall be entitled to
contribution from the Indemnifying Parties with respect to any Obligation
covered by the indemnity specifically provided for in Section 2(b) in the event
that such Indemnitee is finally determined to be guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) in
connection with such Obligation and the Indemnifying Parties are not guilty of
such fraudulent misrepresentation.
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4. Indemnification Procedures.
(a) Whenever any Indemnitee shall have actual knowledge of the reasonable
likelihood of the assertion of a Claim, CD&R (acting on its own behalf or, if
requested by any such Indemnitee other than itself, on behalf of such
Indemnitee) or such Indemnitee shall notify Holding, the Company, NA Acquisition
or the appropriate Subsidiary, as the case may be, in writing of the Claim (the
"Notice of Claim") with reasonable promptness after such Indemnitee has such
knowledge relating to such Claim and has notified CD&R thereof. The Notice of
Claim shall specify all material facts known to CD&R (or if given by such
Indemnitee, such Indemnitee) that may give rise to such Claim and the monetary
amount or an estimate of the monetary amount of the Obligation involved if CD&R
(or if given by such Indemnitee, such Indemnitee) has knowledge of such amount
or a reasonable basis for making such an estimate. The failure of CD&R to give
such Notice of Claim shall not relieve the Indemnifying Parties of their
respective indemnification obligations under this Agreement except to the extent
that such omission results in a failure of actual notice to them and they are
materially injured as a result of the failure to give such Notice of Claim. The
Indemnifying Parties shall, at their expense, undertake the defense of such
Claim with attorneys of their own choosing satisfactory in all respects to CD&R.
CD&R may participate in such defense with counsel of CD&R's choosing at the
expense of the Indemnifying Parties. In the event that the Indemnifying Parties
do not undertake the defense of the Claim within a reasonable time after CD&R
has given the Notice of Claim, or in the event that CD&R shall in good faith
determine that the defense of any claim by the Indemnifying Parties is
inadequate or may conflict with the interest of any Indemnitee, CD&R may, at the
expense of the Indemnifying Parties and after giving notice to the Indemnifying
Parties of such action, undertake the defense of the Claim and compromise or
settle the Claim, all for the account of and at the risk of the Indemnifying
Parties. In the defense of any Claim, the Indemnifying Parties shall not, except
with the prior written consent of CD&R, consent to entry of any judgment or
enter into any settlement that includes any injunctive or other non-monetary
relief, or that does not include as an unconditional term thereof the giving by
the person or persons asserting such Claim to such Indemnitee of a release from
all liability with respect to such Claim. In each case, CD&R and each other
Indemnitee seeking indemnification hereunder will cooperate with the
Indemnifying Parties, so long as the Indemnifying Parties are conducting the
defense of the Claim, in the preparation for and the prosecution of the defense
of such Claim, including making available evidence within the control of CD&R or
such Indemnitee, as the case may be, and persons needed as witnesses who are
employed by CD&R or such Indemnitee, as the case may be, in each case as
reasonably needed for such defense and at cost, which cost, to the extent
reasonably incurred, shall be paid by the Indemnifying Parties.
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(b) The Indemnifying Parties hereby agree to advance costs and expenses,
including attorney's fees, incurred by CD&R (acting on its own behalf or, if
requested by any such Indemnitee other than itself, on behalf of such
Indemnitee) or any Indemnitee in defending any Claim in advance of the final
disposition of such Claim upon receipt of an undertaking by or on behalf of CD&R
or such Indemnitee to repay amounts so advanced if it shall ultimately be
determined that CD&R or such Indemnitee is not entitled to be indemnified by the
Indemnifying Parties as authorized by this Agreement.
(c) CD&R shall notify the Indemnifying Parties in writing of the amount of
any Claim actually paid by CD&R (the "Notice of Payment"). The amount of any
Claim actually paid by CD&R shall bear simple interest at the rate equal to The
Chase Manhattan Bank prime rate as of the date of such payment plus 2% per
annum, from the date the Indemnifying Parties receives the Notice of Payment to
the date on which the Indemnifying Parties shall repay the amount of such Claim
plus interest thereon to CD&R.
5. Certain Covenants. Holding agrees to cause the Company and NA
Acquisition to perform its obligations under this Agreement. The rights of each
Indemnitee to be indemnified under any other agreement, document, certificate or
instrument or applicable law are independent of and in addition to any rights of
such Indemnitee to be indemnified under this Agreement. The rights of each
Indemnitee and the obligations of Holding, the Company and NA Acquisition
hereunder shall remain in full force and effect regardless of any investigation
made by or on behalf of such Indemnitee. Each of Holding, the Company and NA
Acquisition shall maintain the State of Delaware as its state of incorporation
and shall implement and maintain in full force and effect any and all corporate
charter and by-law provisions that may be necessary or appropriate to enable it
to carry out its obligations hereunder to the fullest extent permitted by
Delaware corporate law, including without limitation a provision of its
certificate of incorporation eliminating liability of a director for breach of
fiduciary duty to the fullest extent permitted by Section 102(b)(7) (or any
successor section thereto) of the General Corporation Law of the State of
Delaware, as it may be amended from time to time.
6. Notices. All notices and other communications hereunder shall be in
writing and shall be delivered by certified or registered mail (first class
postage prepaid and return receipt requested), telecopier, overnight courier or
hand delivery, as follows:
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(a) if to NA Acquisition, to:
NA Acquisition Corporation
c/o North American Van Lines, Inc.
5001 U.S. Hwy 30 West
Fort Wayne, Indiana 46801-0988
Attention: General Counsel
Telecopier: (219) 429-3135
with a copy to:
Clayton, Dubilier & Rice, Inc.
375 Park Avenue
New York, New York 10152
Attention: Kevin J. Conway
Telecopier: (212) 407-5252
(b) if to Holding, to it care of the Company at the addresses set forth
above.
(c) if to the Company, to:
North American Van Lines, Inc.
5001 U.S. Hwy 30 West
Fort Wayne, Indiana 46801-0988
Attention: General Counsel
Telecopier: (219) 429-3135
(d) if to the CD&R Fund, to:
Clayton, Dubilier & Rice Fund V Limited Partnership
1403 Foulk Road, Suite 106
Wilmington, Delaware 19803
Attention: General Partner
with a copy to:
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Clayton, Dubilier & Rice, Inc.
375 Park Avenue
New York, New York 10152
Attention: Kevin J. Conway
Telecopier: (212) 407-5252
(e) if to CD&R or any other Indemnitee, to:
Clayton, Dubilier & Rice, Inc.
375 Park Avenue
New York, New York 10022
Attention: Kevin J. Conway
Telecopier: (212) 407-5252
or to such other address or such other person as Holding, the Company, NA
Acquisition, CD&R or the CD&R Fund, as the case may be, shall have designated by
notice to the other parties hereto. All communications hereunder shall be
effective upon receipt by the party to which they are addressed. A copy of any
notice or other communication given under this Agreement shall also be given to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Attention: Paul S. Bird, Esq.
Telecopier: (212) 909-6836
7. Governing Law. This Agreement shall be governed in all respects,
including validity, interpretation and effect, by the law of the State of New
York, regardless of the law that might be applied under principles of conflict
of laws, except to the extent that the corporate law of the State of Delaware
specifically and mandatorily applies, in which case such law shall apply.
8. Severability. If any provision or provisions of this Agreement shall be
held to be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions hereof shall not in any way be
affected or impaired thereby.
9. Miscellaneous. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
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This Agreement shall be binding upon and inure to the benefit of each party
hereto and its successors and permitted assigns, and each other Indemnitee, but
neither this Agreement nor any right, interest or obligation hereunder shall be
assigned, whether by operation of law or otherwise, by Holding, the Company or
NA Acquisition without the prior written consent of CD&R and the CD&R Fund. This
Agreement is not intended to confer any right or remedy hereunder upon any
person other than each of the parties hereto and their respective successors and
permitted assigns and each other Indemnitee. No amendment, modification,
supplement or discharge of this Agreement, and no waiver hereunder shall be
valid and binding unless set forth in writing and duly executed by the party or
other Indemnitee against whom enforcement of the amendment, modification,
supplement or discharge is sought. Neither the waiver by any of the parties
hereto or any other Indemnitee of a breach of or a default under any of the
provisions of this Agreement, nor the failure by any party hereto or any other
Indemnitee on one or more occasions, to enforce any of the provisions of this
Agreement or to exercise any right, powers or privilege hereunder, shall be
construed as a waiver of any other breach or default of a similar nature, or as
a waiver of any provisions hereof, or any rights, powers or privileges
hereunder. The rights and remedies herein provided are cumulative and are not
exclusive of any rights or remedies that any party or other Indemnitee may
otherwise have at law or in equity or otherwise. This Agreement may be executed
in several counterparts, each of which shall be deemed an original, and all of
which together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
by their authorized representatives as of the date first above written.
NA HOLDING CORPORATION
By: /s/Kevin J. Conway
----------------------------------------
Name: Kevin J. Conway
Title: Vice President
NA ACQUISITION CORPORATION
By: /s/Kevin J. Conway
----------------------------------------
Name: Kevin J. Conway
Title: Vice President
NORTH AMERICAN VAN LINES, INC.
By: /s/R. Barry Uber
--------------------------------------------
Name: R. Barry Uber
Title: President and Chief Executive Officer
CLAYTON, DUBILIER & RICE, INC.
By: /s/Joseph L. Rice, III
--------------------------------------------
Name: Joseph L. Rice, III
Title: Chairman and Chief Executive Officer
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CLAYTON, DUBILIER & RICE
FUND V LIMITED PARTNERSHIP
By: CD&R Associates V Limited Partnership, its
general partner
By: CD&R Investment Associates II, Inc., its
managing general partner
By: /s/Joseph L. Rice, III
--------------------------------------------
Name: Joseph L. Rice, III
Title: Chairman and Chief Executive
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Exhibit 10.7
CONSULTING AGREEMENT
This CONSULTING AGREEMENT, dated as of March 30, 1998, by and among NA
Holding Corporation, a Delaware corporation ("Holding"), NA Acquisition
Corporation, a Delaware corporation and wholly-owned subsidiary of Holding ("NA
Acquisition"), and North American Van Lines, Inc. a Delaware corporation and
wholly owned subsidiary of Holding (the "Company", together with Holding and NA
Acquisition, the "Acquisition Group") and Clayton, Dubilier & Rice, Inc., a
Delaware corporation ("CD&R").
W I T N E S S E T H:
WHEREAS, NA Acquisition has acquired all of the outstanding shares of
capital stock of the Company pursuant to a certain Stock Purchase Agreement,
dated as of January 9, 1998 (as amended from time to time, the "Stock Purchase
Agreement") and a certain Preferred Shares Stock Purchase Agreement, dated as of
January 9, 1998 (the "Preferred Stock Agreement") (such transactions being
hereinafter referred to as the "Acquisition");
WHEREAS, CD&R has performed financial, management advisory and other
services for the Acquisition Group, including but not limited to assistance in
connection with (i) the preparation, negotiation, execution and delivery of the
Stock Purchase Agreement and the Preferred Stock Purchase Agreement, (ii) the
retention of legal, accounting, environmental, insurance, investment banking,
financial and other advisors and consultants in connection with the Acquisition,
(iii) the preparation, negotiation, execution and delivery of the commitment,
fee and engagement letters, registration rights and purchase agreements, credit
agreements, guarantees, mortgages, pledge agreements and other security
agreements, subscription, management equity agreements, and other agreements,
instruments and documents, relating to the Acquisition, the financing of the
Acquisition and (iv) the structuring, implementation and consummation of the
Acquisition (such services collectively, the "Acquisition Services");
WHEREAS, immediately following the closing of the Acquisition, it is
contemplated that NA Acquisition will be merged with and into the Company,
leaving the Company as the surviving entity and a wholly owned subsidiary of
Holding;
WHEREAS, the Acquisition Group desires, following the Acquisition, to
receive financial and managerial advisory services from CD&R, and CD&R desires
to provide such services to the Acquisition Group;
<PAGE>
NOW, THEREFORE, in consideration of the premises and the respective
agreements hereinafter set forth and the mutual benefits to be derived herefrom,
the parties hereto hereby agree as follows:
1. Engagement. The Acquisition Group hereby engages CD&R as a consultant,
and CD&R hereby agrees to provide financial and managerial advisory services to
the Acquisition Group, all on the terms and subject to the conditions set forth
below.
2. Services, etc. (a) CD&R hereby agrees during the term of this
engagement to assist, advise and consult with the respective Boards of Directors
and management of each member of the Acquisition Group and their respective
subsidiaries in such manner and on such business, management and financial
matters, and provide such other financial and managerial advisory services
(collectively, the "Continuing Services"), as may be reasonably requested from
time to time by the Boards of Directors of each member of the Acquisition Group,
including but not limited to assistance in:
(i) establishing and maintaining banking, legal and other business
relationships for each such member and its subsidiaries;
(ii) developing and implementing corporate and business strategy and
planning for each such member and its subsidiaries, including plans
and programs for improving operating, marketing and financial
performance, budgeting of future corporate investments, acquisition
and divestiture strategies, and reorganizational programs;
(iii) arranging future debt and equity financings and refinancings; and
(iv) providing professional employees to serve as directors or officers
of each member of the Acquisition Group.
(b) Each member of the Acquisition Group will furnish CD&R with such
information as CD&R believes appropriate to its engagement hereunder (all such
information so furnished being referred to herein as the "Information"). Each
member of the Acquisition Group recognizes and confirms that (i) CD&R will use
and rely primarily on the Information and on information available from
generally recognized public sources in performing the services to be performed
hereunder and (ii) CD&R does not assume responsibility for the accuracy or
completeness of the Information and such other information.
3. Compensation; Payment of Expenses. (a) The Acquisition Group jointly
and severally agree to pay to CD&R, concurrent with the execution of this
Agreement, as compensation for the Acquisition Services, a fee of $2,950,000.
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(b) The Acquisition Group jointly and severally agree to pay to CD&R, as
compensation for Continuing Services rendered and to be rendered by CD&R
hereunder, a fee of $500,000 per year (the "Continuing Services Fee"),
one-twelfth of which shall be payable on the first day of each month commencing
on the first day of the month following the date of the closing of the
Acquisition. Such Continuing Services Fee may, in the sole discretion of a
majority of the members of the Company's Board of Directors who are not
affiliated with CD&R, be increased but may not be decreased without the prior
written consent of CD&R. If any employee of CD&R shall be elected to serve on
the Board of Directors of any member of the Acquisition Group or any of their
affiliates (a "Designated Director"), in consideration of the Continuing
Services Fee being paid to CD&R, CD&R shall cause such Designated Director to
waive any and all fees to which such director would otherwise be entitled as a
director for any period for which the Fee or any installment thereof is paid.
(c) The Acquisition Group jointly and severally agree to reimburse CD&R
for such reasonable travel and other out-of-pocket expenses ("Expenses") as may
be incurred by CD&R and its employees and agents in the course or on account of
rendering any Acquisition Services or Continuing Services including but not
limited to any fees and expenses of any legal, accounting or other professional
advisors to CD&R engaged in connection with Acquisition Services and Continuing
Services previously provided or being provided hereunder and any expenses
incurred by any Designated Director in connection with the performance of his
duties. CD&R may submit monthly expense statements, which shall be payable
within thirty days.
4. Term, etc. (a) This Agreement shall be in effect until, and shall
terminate upon, the earlier to occur of (x) the tenth anniversary of the date
hereof and (y) the date on which the CD&R Fund no longer owns any shares of the
capital stock of Holding, and may be earlier terminated by either party hereto
upon 30 days' prior written notice to the other party hereto. The provisions of
this Agreement shall survive any termination of this Agreement, except for the
provisions of Section 1, Section 2(a), the first sentence of Section 2(b) and
(solely as to any portion of the Continuing Services Fee or any Expense not paid
or reimbursed prior to such termination and not required to be paid or
reimbursed thereafter pursuant to Section 4(c) hereof) Section 3 hereof.
(b) Upon any consolidation or merger, or any conveyance, transfer or lease
of all or substantially all of the assets of the Company as an entirety, the
successor corporation formed by such consolidation or into which the Company is
merged or to which such conveyance, transfer or lease is made shall succeed to,
and be substituted for, the Company under this Agreement with the same effect as
if such successor corporation has been a party thereto. No such consolidation,
merger or conveyance, transfer or lease of all or substantially all of the
assets of the Company shall have the effect of terminating this Agreement or of
releasing the Company or any such successor corporation from its obligations
hereunder.
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(c) Upon any termination of this Agreement, any accrued and unpaid
installment of the Continuing Services Fee or portion thereof (pro rated, with
respect to the month in which such termination occurs, for the portion of such
month that precedes such termination), and any unpaid and unreimbursed Expenses
that shall have been incurred prior to such termination (whether or not such
Expenses shall then have become payable), shall be immediately paid or
reimbursed, as the case may be, by the Company. In the event of the liquidation
of the Company, all amounts due CD&R hereunder shall be paid to CD&R before any
liquidating distributions or similar payments are made to stockholders of the
Company.
5. Indemnification. (a) Each member of the Acquisition Group confirms and
reaffirms its obligations pursuant to the Indemnification Agreement, dated as of
the date hereof, (the "Indemnification Agreement"), among Holding, the Company,
NA Acquisition, CD&R and the CD&R Fund (as such term is defined in the
Indemnification Agreement), as the same may be amended, waived, modified or
supplemented from time to time. Without limiting the generality of the
foregoing, each member of the Acquisition Group confirms and agrees that (a) it
shall indemnify, defend and hold harmless CD&R, the CD&R Fund (as defined in the
Indemnification Agreement), CD&R Associates (as defined in the Indemnification
Agreement) and each of the respective directors, officers, partners, employees,
agents, advisors, representatives and controlling persons (within the meaning of
the Securities Act of 1933, as amended) of CD&R, the CD&R Fund and CD&R
Associates (collectively, "Indemnitees") from and against any and all claims,
obligations, liabilities, causes of action, actions, suits, proceedings,
investigations, judgments, decrees, losses, damages, fees, costs and expenses
(including without limitation interest, penalties and fees and disbursements of
attorneys, accountants, investment bankers and other professional advisors)
(collectively, "Obligations"), whether incurred with respect to third parties or
otherwise, in any way resulting from, arising out of or in connection with,
based upon or relating to, the performance of the Merger Services or the
Continuing Services contemplated hereby, except to the extent that any such
Obligation is found in a final judgment by a court having jurisdiction to have
resulted from the gross negligence or intentional misconduct of CD&R, (b) no
Indemnitee shall have any liability (whether direct or indirect, in contract or
tort or otherwise) to a member of the Acquisition Group or their respective
security holders or creditors with respect to any Obligation in any way
resulting from, arising out of or in connection with, based upon or relating to,
the performance of the Merger Services or the Continuing Services contemplated
hereby, except to the extent that any such Obligation is found in a final
judgment by a court having jurisdiction to have resulted from the gross
negligence or intentional misconduct of CD&R, and (c) the rights of each
Indemnitee to be indemnified under any agreement, document, certificate or
instrument or applicable law are independent of and in addition to any rights of
such Indemnitee under any other agreement, document, certificate or instrument
or applicable law.
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(b) The Company hereby agrees to advance costs and expenses, including
attorneys' fees, incurred by CD&R (acting on its own behalf or, if requested by
any such Indemnitee other than itself, on behalf of such Indemnitee) or any
Indemnitee in defending any claim relating to any Obligation in advance of the
final disposition of such claim within 30 days of receipt from CD&R of (i) a
notice setting forth the amount of such costs and expenses (a "Payment Notice")
and (ii) an undertaking by or on behalf of CD&R or such Indemnitee to repay
amounts so advanced if it shall ultimately be determined that CD&R or such
Indemnitee is not entitled to be indemnified by the Company as authorized by
this Agreement. CD&R may submit Payment Notices to the Company monthly.
6. Independent Contractor Status. The parties agree that CD&R shall
perform services hereunder as an independent contractor, retaining control over
and responsibility for its own operations and personnel. Neither CD&R nor any of
its employees or agents shall, solely by virtue of this Agreement or the
arrangements hereunder, be considered employees or agents of any member of the
Acquisition Group nor shall any of them have authority to contract in the name
of a member of or bind the Acquisition Group, except (a) to the extent that any
professional employee of CD&R may be serving as an officer of a member of the
Acquisition Group pursuant to Section 2(a)(iv) hereof, (b) as expressly agreed
to in writing by a member of the Acquisition Group and (c) each member of the
Acquisition Group hereby acknowledges and agrees that any agreements,
arrangements or understandings entered into by CD&R on behalf of any member of
the Acquisition Group prior to the date hereof in connection with the formation
of the Company and the acquisition by the Company of its business (including,
but not limited to, any confidentiality agreements, agreements with brokers or
finders and any arrangements relating to the financing of such acquisition)
shall be obligations of the Company binding on it to the same extent as such
obligations may be binding on CD&R and the Company shall fully perform, and
shall indemnify and hold harmless CD&R from and against, all such obligations.
Any duties of CD&R arising out of its engagement to perform services hereunder
shall be owed solely to the Company.
7. Notices. Any notice or other communication required or permitted to be
given or made under this Agreement by one party to the other parties shall be in
writing and shall be deemed to have been duly given and effective (i) on the
date of delivery if delivered personally or (ii) when sent if sent by prepaid
telegram, or mailed first-class, postage prepaid, registered or certified mail,
or facsimile transmission as follows (or to such other address as shall be given
in writing by one party to the other parties in accordance herewith):
5
<PAGE>
If to Company, NA Holding Corporation or NA Acquisition Corporation to:
North American Van Lines, Inc.
5001 U.S. Highway 30 West
Fort Wayne, Indiana 46801-0988
Attention: General Counsel
Telephone: (219) 429-2511
Telecopy: (219) 429-3135
If to CD&R to:
Clayton, Dubilier & Rice, Inc.
375 Park Avenue
New York, New York 10152
Attention: Kevin J. Conway
Telephone: (212) 407-5200
Telecopy: (212) 407-5252
with a copy to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Attention: Paul S. Bird, Esq.
Telephone: (212) 909-6000
Telecopy: (212) 909-6836
8. Entire Agreement. This Agreement, together with the Indemnification
Agreement (a) contain the complete and entire understanding and agreement of
CD&R and each member of the Acquisition Group with respect to the subject matter
hereof, and (b) supersede all prior and contemporaneous understandings,
conditions and agreements, oral or written, express or implied, in respect of
the subject matter hereof, including but not limited to in respect of the
engagement of CD&R in connection with the subject matter hereof. There are no
representations or warranties of CD&R in connection with this Agreement or the
services to be provided hereunder, except as expressly made and contained in
this Agreement.
9. Headings. The headings contained in this Agreement are for purposes of
convenience only and shall not affect the meaning or interpretation of this
Agreement.
6
<PAGE>
10. Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed an original and all of which shall together
constitute one and the same instrument.
11. Binding Effect; Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties to this Agreement and their respective
successors and assigns and to each Indemnitee, provided that none of CD&R or any
member of the Acquisition Group may assign any of its rights or obligations
under this Agreement without the express written consent of the other party
hereto. This Agreement is not intended to confer any right or remedy hereunder
upon any person other than the parties to this Agreement and their respective
successors and permitted assigns and each Indemnitee.
12. Governing Law. This Agreement shall be deemed to be a contract made
under, and is to be governed and construed in accordance with, the laws of the
State of New York, without regard to the conflict of laws principles or rules
thereof. Each member of the Acquisition Group and CD&R hereby irrevocably submit
to the jurisdiction of the courts of the State of New York and the Federal
courts of the United States of America located in the State, City and County of
New York solely in respect of the interpretation and enforcement of the
provisions of this Agreement, and hereby waive, and agree not to assert, as a
defense in any action, suit or proceeding for the interpretation or enforcement
hereof, that it is not subject thereto or that such action, suit or proceeding
may not be brought or is not maintainable in such courts or that the venue
thereof may not be appropriate or that this Agreement may not enforced in or by
such courts, and the parties hereto irrevocably agree that all claims with
respect to such action or proceeding shall be heard and determined in such a New
York State or Federal court. Each member of the Acquisition Group and CD&R
hereby consent to and grant any such court jurisdiction over the person of such
parties and over the subject matter of any such dispute and agree that mailing
of process or other papers in connection with any such action or proceeding in
the manner provided in Section 7, or in such other manner as may be permitted by
law, shall be valid and sufficient service thereof.
13. Waiver of Jury Trial. Each party hereto acknowledges and agrees that
any controversy that may arise under this Agreement is likely to involve
complicated and difficult issues, and therefore it hereby irrevocably and
unconditionally waives any right it may have to a trial by jury in respect of
any litigation directly or indirectly arising out of or relating to this
Agreement, or the breach, termination or validity of this Agreement, or the
transactions contemplated by this Agreement. Each party certifies and
acknowledges that (a) no representative, agent or attorney of any other party
has represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce the foregoing waiver, (b) it understands
and has considered the implications of this waiver, (c) it makes this waiver
7
<PAGE>
voluntarily, and (d) it has been induced to enter into this Agreement by, among
other things, the mutual waivers and certifications contained in this Section
13.
14. Amendment; Waivers. No amendment, modification, supplement or
discharge of this Agreement, and no waiver hereunder, shall be valid or binding
unless set forth in writing and duly executed by the party or Indemnitee against
whom enforcement of the amendment, modification, supplement, discharge or waiver
is sought (and in the case of a member of the Acquisition Group, approved by
resolution of the Boards of Directors of such member of the Acquisition Group).
Any such waiver shall constitute a waiver only with respect to the specific
matter described in such writing and shall in no way impair the rights of the
party or Indemnitee granting such waiver in any other respect or at any other
time. Neither the waiver by any of the parties hereto or any Indemnitee of a
breach of or a default under any of the provisions of this Agreement, nor the
failure by any party hereto or any Indemnitee on one or more occasions, to
enforce any of the provisions of this Agreement or to exercise any right, powers
or privilege hereunder, shall be construed as a waiver of any other breach or
default of a similar nature, or as a waiver of any of such provisions, rights,
power or privileges hereunder. The rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies that any party or
Indemnitee may otherwise have at law or in equity or otherwise.
8
<PAGE>
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
CLAYTON, DUBILIER & RICE, INC.
By: /s/Joseph L. Rice
--------------------------------------
Name: Joseph L. Rice
Title: Chairman and Chief Executive
Officer
NA ACQUISITION CORPORATION
By: /s/Kevin J. Conway
--------------------------------------
Name: Kevin J. Conway
Title: Vice President
NA HOLDING CORPORATION
By: /s/Kevin J. Conway
--------------------------------------
Name: Kevin J. Conway
Title: Vice President
NORTH AMERICAN VAN LINES, INC.
By: /s/R. Barry Uber
--------------------------------------
Name: R. Barry Uber
Title: President and Chief Executive
Officer
9
<PAGE>
Exhibit 10.8
Conformed Copy
================================================================================
NA HOLDING CORPORATION
REGISTRATION AND PARTICIPATION AGREEMENT
Dated as of March 30, 1998
================================================================================
<PAGE>
TABLE OF CONTENTS
(Not Part of Agreement)
Page
1. Background.............................................................. 1
2. Definitions............................................................. 3
3. Registration............................................................ 9
3.1. Registration on Request........................................... 9
(a) Requests..................................................... 9
(b) Obligation to Effect Registration............................ 9
(c) Registration Statement Form.................................. 10
(d) Expenses..................................................... 11
(e) Inclusion of Other Securities................................ 12
(f) Effective Registration Statement............................. 12
(g) Pro Rata Allocation.......................................... 12
3.2. Incidental Registration........................................... 13
3.3. Registration Procedures........................................... 16
3.4. Underwritten Offerings............................................ 22
(a) Underwritten Offerings Exclusive............................. 22
(b) Underwriting Agreement....................................... 22
(c) Selection of Underwriters.................................... 23
(d) Incidental Underwritten Offerings............................ 23
(e) Hold Back Agreements......................................... 24
3.5. Preparation; Reasonable Investigation............................. 25
3.6. Other Registrations............................................... 25
3.7. Indemnification................................................... 26
(a) Indemnification by the Company............................... 26
(b) Indemnification by the Sellers............................... 28
(c) Notices of Claims, etc....................................... 29
(d) Other Indemnification........................................ 30
(e) Other Remedies............................................... 30
(f) Officers and Directors....................................... 31
(g) Indemnification Payments..................................... 31
4. Participation Rights.................................................... 31
(a) Procedures for Qualifying Sales.............................. 31
(b) Qualifying Sale Defined...................................... 33
(c) Exclusion from Qualifying Sale............................... 33
5. Investors' Rights to Purchase Additional Capital Stock ................. 34
i
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Page
(a) CD&R Sale.................................................... 34
(b) Offer Procedures............................................. 34
6. Miscellaneous........................................................... 36
6.1. (a) Rule 144..................................................... 36
(b) Legend on Stock Certificates................................. 36
6.2. Amendments and Waivers............................................ 37
6.3. Nominees for Beneficial Owners.................................... 37
6.4. Successors, Assigns and Transferees............................... 38
6.5. Notices........................................................... 38
6.6. No Inconsistent Agreements........................................ 40
6.7. Remedies; Attorneys' Fees......................................... 40
6.8. Stock Splits, etc................................................. 40
6.9. Term ............................................................ 41
6.10. Severability..................................................... 41
6.11. Headings......................................................... 41
6.12. Counterparts..................................................... 41
6.13. Governing Law.................................................... 41
6.14. No Third Party Beneficiaries..................................... 42
6.15. Consent to Jurisdiction.......................................... 42
6.16. Waiver of Jury Trial............................................. 42
6.17. Entire Agreement................................................. 42
ii
<PAGE>
REGISTRATION AND PARTICIPATION AGREEMENT
REGISTRATION AND PARTICIPATION AGREEMENT, dated as of March 30,
1998, among NA Holding Corporation, a Delaware corporation (the "Company"), and
Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands exempted
limited partnership (together with any successor investment vehicle managed by
Clayton, Dubilier & Rice, Inc., the "CD&R Fund").
1. Background. (a) NA Acquisition Corporation, a Delaware
corporation and wholly-owned subsidiary of the Company ("NA Acquisition") is
party to a Stock Purchase Agreement, dated as of January 9, 1998, as amended
from time to time (the "Purchase Agreement"), with Norfolk Southern Corporation,
a Virginia corporation ("Norfolk Southern") and a Preferred Shares Stock
Purchase Agreement, dated as of January 9, 1998 (the "Preferred Stock Purchase
Agreement"), with J.P. Morgan Ventures Corporation, a Delaware corporation
("J.P. Morgan Ventures"), pursuant to which NA Acquisition has agreed to acquire
all of the capital stock of North American Van Lines, Inc., a Delaware
corporation ("NAVL") from Norfolk Southern and J.P. Morgan Ventures (such
transactions are collectively referred to herein, as the "Acquisition").
(b) In connection with the Acquisition, the Company is or will be
party to (i) a Stock Subscription Agreement, dated as of the date hereof (the
"Fund Stock Subscription Agreement"), between the Company and the CD&R Fund,
pursuant to which the Company has agreed to issue 615,050 shares of its Common
Stock (as hereinafter defined) to the CD&R Fund, (ii) separate Management Stock
Subscription Agreements, dated as of the date hereof (the "Management Stock
Subscription Agreements"), between the Company and certain senior executives or
key employees of the Company or one of it subsidiaries (the "Management
Purchasers") pursuant to which the Company has agreed to issue up to an
aggregate of 34,950 shares of its Common Stock and (iii) a Capital Call
Agreement, dated as of the date hereof, pursuant to which the Company has agreed
to issue and sell additional shares of its Common Stock to the CD&R Fund under
the terms specified therein (the "Capital Call Agreement").
(c) The Company may in the future issue or sell shares of Common
Stock to certain key executives and employees of the Company or one of its
subsidiaries (the "Subsequent Management Purchasers") pursuant to appropriate
forms of stock subscription agreements (the "Subsequent
<PAGE>
Stock Subscription Agreements") or grant options to purchase additional shares
of Common Stock to Management Purchasers, Subsequent Management Purchasers or
certain non-employee directors or other purchasers (the "Subsequent Purchasers")
pursuant to appropriate forms of stock option agreements, plans or arrangements
(the "Subsequent Stock Option Agreements"). The Company may in the future issue
or sell shares of Common Stock to (i) certain Individual Investors (as
hereinafter defined) pursuant to appropriate forms of stock subscription
agreements (the "Individual Investor Stock Subscription Agreements", (ii)
Subsequent Purchasers pursuant to appropriate forms of stock subscription
agreements (the "Director Stock Subscription Agreements") and has adopted an
option plan, and may in the future adopt additional option plans, that will
permit executive officers and certain employees of the Company and its
subsidiaries to acquire shares of Common Stock, or (iii) certain Agents (as
hereinafter defined) pursuant to appropriate forms of stock subscription
agreements (the "Agent Stock Subscription Agreements").
(d) The Management Purchasers, the Subsequent Management Purchasers,
the Subsequent Purchasers and any trusts holding shares of Common Stock or
options to purchase shares of Common Stock for the benefit of relatives of any
Management Purchaser, Subsequent Management Purchaser or Subsequent Purchaser
who is an employee or director of the Company or one of its subsidiaries are
referred to herein collectively as the "Management Investors". The Fund Stock
Subscription Agreement, the Capital Call Agreement, the Management Stock
Subscription Agreements, the Individual Investor Stock Subscription Agreements,
the Director Stock Subscription Agreements, the Agent Stock Subscription
Agreements and the Subsequent Stock Option Agreements are referred to herein
collectively as the "Stock Subscription Agreements".
(e) This Agreement shall become effective as of the date hereof with
respect to any Registrable Securities (as hereinafter defined) upon the issuance
or sale of Common Stock to any party pursuant to any Stock Subscription
Agreement (as defined hereinafter) that provides such Common Stock shall be
Registrable Securities, it being understood that, with respect to Registrable
Securities to be issued in the future, any Stock Subscription Agreement will
provide that the shares of Common Stock sold thereunder are entitled to rights
and subject to the obligations created hereunder, provided that such issuance or
sale shall have been consented to in writing by the Board of Directors of the
Company (the "Board").
2
<PAGE>
2. Definitions. For purposes of this Agreement, the following terms
have the following respective meanings:
"Acquisition": See Section 1.
"Affiliate": With respect to any Person, any other Person directly
or indirectly Controlling, Controlled by or under common Control with such first
Person, provided that any director or member of management or other employee of
the Company or any of its subsidiaries shall not be deemed to be an Affiliate of
the CD&R Fund.
"Agent": independently owned moving companies that have entered into
contractual arrangements with NAVL to provide a portion of hauling to support
the interstate moving services of the NAVL.
"Business Day": A day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required to close.
"CD&R": Clayton, Dubilier & Rice, Inc., a Delaware corporation.
"CD&R Fund": See Section 1.
"CD&R Sale": See Section 4(a).
"Common Stock": The common stock, par value $.01 per share of the
Company.
"Company": See the introduction to this Agreement.
"Control": The power to direct the affairs of a Person by reason of
ownership of voting stock, by control or otherwise.
"Director Stock Subscription Agreements": See Section 1.
"Excess Number": See Section 4(b).
"Exchange Act": The Securities Exchange Act of 1934, as amended, or
any successor Federal statute, and the rules and regulations thereunder which
shall be in effect at the time. Any reference to a particular section thereof
shall include a reference to the corresponding section, if any, of any successor
Federal statute, and the rules and regulations thereunder.
3
<PAGE>
"Fund Stock Subscription Agreement": See Section 1.
"Individual Investors": Directors or senior executives of
corporations in which entities managed or sponsored by Clayton, Dubilier & Rice,
Inc. have or have had investments.
"Individual Investor Stock Subscription Agreement": See Section 1.
"Management Investors": See Section 1.
"Management Purchasers": See Section 1.
"Management Stock Subscription Agreements": See Section 1.
"NA Acquisition": See Section 1(a).
"NASD": National Association of Securities Dealers, Inc.
"NASDAQ": The NASD Automated Quotation System.
"NAVL": See Section 1(a).
"Offer": See Section 5(a).
"Offered Securities": See Section 5(b).
"Person": Any natural person, firm, partnership, association,
corporation, company, trust, business trust, governmental entity or other entity
and any successor (by merger or otherwise) of such entity.
"Proportionate Share": See Section 5(b).
"Public Market": A "Public Market" for the Company's Common Stock
shall be deemed to have been established at such time as 30% of the Common Stock
(on a fully diluted basis) has been sold to the public pursuant to an effective
registration statement under the Securities Act or pursuant to Rule 144.
"Public Offering": An underwritten public offering of Common Stock
led by at least one underwriter of nationally recognized standing.
4
<PAGE>
"Qualifying Number": 30,753 shares of Common Stock (excluding any
sales or transfers by the CD&R Fund to Management Investors and Individual
Investors)
"Qualifying Sale": See Section 4(b).
"Registrable Securities": (a) any shares of Common Stock issued
pursuant to any Stock Subscription Agreement, including upon exercise of options
granted pursuant to the Subsequent Stock Option Agreements, that provides that
such Common Stock shall be Registrable Securities, except for any such Common
Stock issued pursuant to an effective registration statement under the
Securities Act on Form S-8, Form S-4, Form S-1 or any successor form to any
thereof (unless such Common Stock is held by a Management Investor who is an
Affiliate of the Company), (b) any shares of Common Stock issued pursuant to the
terms of, and under the circumstances set forth in, Section 5, and (c) any
securities issued or issuable with respect to any Common Stock referred to in
the foregoing clauses (i) upon any conversion or exchange thereof, (ii) by way
of stock dividend or stock split, (iii) in connection with a combination of
shares, recapitalization, merger, consolidation or other reorganization or (iv)
otherwise, in all cases subject to the penultimate paragraph of Section 3.3. As
to any particular Registrable Securities, once issued, such securities shall
cease to be Registrable Securities when (A) a registration statement (other than
a Special Registration pursuant to which such securities were issued by the
Company to a Management Investor who is an Affiliate of the Company) with
respect to the sale of such securities shall have become effective under the
Securities Act and such securities shall have been disposed of in accordance
with such registration statement, (B) such securities shall have been
distributed to the public in reliance upon Rule 144, (C) subject to the relevant
provisions of the Company's Certificate of Incorporation and the Stock
Subscription Agreement pursuant to which such securities shall have been issued,
such securities shall have been otherwise transferred, new certificates for such
securities not bearing a legend restricting further transfer shall have been
delivered by the Company and subsequent disposition of such securities shall not
require registration or qualification of such securities under the Securities
Act or any similar state law then in force, (D) except for purposes of Sections
4 and 5, such securities have been held, or deemed, by virtue of tacking holding
periods as contemplated by Rule 144, to be held for a period of two years by a
Person who is not an Affiliate of the Company, (E) such securities shall have
ceased to be outstanding, (F) except for purposes of Sections 4 and 5, with
respect to any such securities
5
<PAGE>
acquired by a Management Investor pursuant to the exemption from the
registration requirements of the Securities Act contained in Rule 701 (or any
successor provision) thereunder, at any time following the date the Company
registers a class of equity securities under Section 12 of the Exchange Act or
(G) the Company shall have registered the Common Stock under Section 12 of the
Exchange Act and such securities are held by a Person who is not an Affiliate of
the Company; provided that (x) for purposes of clauses (D) and (G) above, (1)
securities held by a Person who was not an Affiliate of the Company at the time
of the event specified in such clauses but who thereafter becomes an Affiliate
of the Company shall be and remain Registrable Securities for so long as such
Person is an Affiliate of the Company and (2) securities held by a Person who
was an Affiliate of the Company at the time of the event specified in such
clauses shall remain Registrable Securities for only so long as such Person
remains an Affiliate of the Company and (y) with respect to any securities that
were formerly Registrable Securities the Board of Directors may, under such
circumstances as it deems appropriate, designate such securities as Registrable
Securities for purposes of this Agreement.
"Registration Expenses": All expenses incident to the Company's
performance of its obligations under or compliance with Section 3, including,
but not limited to, all registration and filing fees, all fees and expenses of
complying with securities or blue sky laws, all fees and expenses associated
with listing securities on exchanges or NASDAQ, all fees and other expenses
associated with filings with the NASD (including, if required, the fees and
expenses of any "qualified independent underwriter" and its counsel), all
printing expenses, the fees and disbursements of counsel for the Company and of
its independent public accountants, and the expenses of any special audits made
by such accountants required by or incidental to such performance and compliance
and the fees and disbursements of one law firm (but not more than one) retained
by the holders holding a majority (by number of shares) of the Registrable
Securities but not including any underwriting discounts or commissions or any
transfer taxes payable in respect of the sale of Registrable Securities by the
holders thereof.
"Requisite Percentage of Stockholders": The holder or holders of at
least (a) as to the initial request under Section 3.1, 50% (by number of shares)
of the Registrable Securities held at the time outstanding or (b) as to any
other request, 20% (by number of shares) of the Registrable Securities at the
time outstanding.
6
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"Rule 144": Rule 144 (or any successor provision) under the
Securities Act.
"Rule 144A": Rule 144A (or any successor provision) under the
Securities Act.
"Sale Notice": See Section 4(a).
"Securities Act": The Securities Act of 1933, as amended, or any
successor Federal statute, and the rules and regulations thereunder which shall
be in effect at the time. Any reference to a particular section thereof shall
include a reference to the corresponding section, if any, of any successor
Federal statute, and the rules and regulations thereunder.
"Securities and Exchange Commission": The Securities and Exchange
Commission or any other Federal agency at the time administering the Securities
Act or the Exchange Act.
"Special Registration": (a) The registration of shares of equity
securities and/or options or other rights in respect thereof to be offered to
directors, members of management, employees, consultants or sales agents,
distributors or similar representatives of the Company or its direct or indirect
Subsidiaries or senior executives of Persons controlled by an Affiliate of the
Company or (b) the registration of equity securities and/or options or other
rights in respect thereof solely on Form S-4 or S-8 or any successor form.
"Stock Subscription Agreements": See Section 1.
"Subsequent Management Purchasers": See Section 1.
"Subsequent Purchasers": See Section 1.
"Subsequent Stock Option Agreements": See Section 1.
"Subsequent Stock Subscription Agreements": See Section 1.
"Subsidiary": With respect to any Person, any corporation or Person,
a majority of the outstanding voting stock or other equity interests of which is
owned, directly or indirectly, by that Person.
3. Registration.
7
<PAGE>
3.1. Registration on Request.
(a) Requests. Subject to the provisions of Section 3.6, at any time
or from time to time the Requisite Percentage of Stockholders shall have the
right to make one or more written requests that the Company effect the
registration under the Securities Act of all or part of the Registrable
Securities of the holder or holders making such request, which requests shall
specify the intended method of disposition thereof by such holder or holders.
(b) Obligation to Effect Registration. Upon receipt by the Company
of any request for registration pursuant to Section 3.1(a), the Company will
promptly give written notice of such requested registration to all holders of
Registrable Securities, and thereupon will use its best efforts to effect the
registration under the Securities Act of
(i) the Registrable Securities which the Company has been so
requested to register pursuant to Section 3.1(a), and
(ii) all other Registrable Securities which the Company has been
requested to register by the holders thereof by written request given to
the Company within 30 days after the Company has given such written notice
(which request shall specify the intended method of disposition of such
Registrable Securities),
all to the extent required to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities so to be
registered. Notwithstanding the preceding sentence:
(x) the Company shall not be required to effect a registration
requested pursuant to Section 3.1 if the aggregate number of Registrable
Securities referred to in clauses (i) and (ii) of this Section 3.1(a)
included in such registration shall be less than 20% of the Registrable
Securities at the time outstanding; and
(y) if the Board of Directors of the Company (the "Board")
determines in its good faith judgment, after consultation with a firm of
nationally recognized underwriters, that there will be an adverse effect
on a then contemplated initial public offering of the Common Stock, the
Requisite Percentage of Stockholders shall be given notice of such fact
and shall be deemed to have withdrawn such request and such registration
shall
8
<PAGE>
not be deemed to have been effected or requested pursuant to this Section
3.1.
(c) Registration Statement Form. Each registration requested
pursuant to this Section 3.1 shall be effected by the filing of a registration
statement on Form S-1, Form S-2 or Form S-3 (or any other form which includes
substantially the same information as would be required to be included in a
registration statement on such forms as presently constituted), unless the use
of a different form is (i) required by law or (ii) permitted by law and agreed
to in writing by holders holding at least a majority (by number of shares) of
the Registrable Securities as to which registration has been requested pursuant
to this Section 3.1. At any time after the Company has issued and sold any
shares of its capital stock registered under an effective registration statement
under the Securities Act, or after the Company shall have registered any class
of equity securities pursuant to Section 12 of the Exchange Act, it will use its
best efforts to qualify for registration on Form S-2 or Form S-3 (or any other
comparable form hereinafter adopted).
(d) Expenses. The Company will pay all Registration Expenses in
connection with the first three registrations which are effected as requested
under Section 3.1(a). The Registration Expenses in connection with each other
registration, if any, requested under this Section 3.1 shall be apportioned
among the holders whose Registrable Securities are then being registered, on the
basis of the respective amounts (by number of shares) of Registrable Securities
then being registered by them or on their behalf. However, in the case of all
registrations requested under Section 3.1(a), the Company shall pay all amounts
in respect of (i) any allocation of salaries of personnel of the Company and its
Subsidiaries or other general overhead expenses of the Company and its
Subsidiaries or other expenses for the preparation of financial statements or
other data normally prepared by the Company and its Subsidiaries in the ordinary
course of its business, (ii) the expenses of any officers' and directors'
liability insurance, (iii) the expenses and fees for listing the securities to
be registered on each exchange on which similar securities issued by the Company
are then listed or, if no such securities are then listed on an exchange
selected by the Company and (iv) all fees associated with filings required to be
made with the NASD (including, if applicable, the fees and expenses of any
"qualified independent underwriter" and its counsel as may be required by the
rules and regulations of the NASD). Notwithstanding the provisions of this
section 3.1(d) or of Section 3.2, each seller of Registrable Securities shall
pay
9
<PAGE>
all Registration Expenses to the extent required to be paid by such seller by
applicable law.
(e) Inclusion of Other Securities. The Company shall not register
securities (other than Registrable Securities) for sale for the account of any
Person other than the Company in any registration requested pursuant to Section
3.1(a) unless permitted to do so by the written consent of holders holding at
least a majority (by number of shares) of the Registrable Securities proposed to
be sold in such registration.
(f) Effective Registration Statement. A registration requested
pursuant to Section 3.1(a) will not be deemed to have been effected unless it
has become effective for the period specified in Section 3.3(b). Notwithstanding
the preceding sentence, a registration requested pursuant to Section 3.1(a)
which does not become effective after the Company has filed a registration
statement with respect thereto solely by reason of the refusal to proceed of the
holder or holders of Registrable Securities requesting the registration shall be
deemed to have been effected by the Company at the request of such holder or
holders.
(g) Pro Rata Allocation. If the holders of a majority (by number of
shares) of the Registrable Securities for which registration is being requested
pursuant to Section 3.1(a) determine, based on consultation with the managing
underwriters or, in an offering which is not underwritten, with an investment
banker, that the number of securities to be sold in any such offering should be
limited due to market conditions or otherwise, all holders of Registrable
Securities proposing to sell their securities in such registration shall share
pro rata in the number of securities being offered (as determined by the holders
holding a majority (by number of shares) of the Registrable Securities for which
registration is being requested in consultation with the managing underwriters
or investment banker, as the case may be) and registered for their account, such
sharing to be based on the number of Registrable Securities as to which
registration was requested by such holders, respectively.
3.2. Incidental Registration. If the Company at any time proposes to
register any of its equity securities (as defined in the Exchange Act) under the
Securities Act (other than pursuant to Section 3.1 or pursuant to a Special
Registration), whether or not for sale for its own account, and the registration
form to be used may be used for the registration of Registrable Securities, it
will each such time give prompt written notice to all holders of Regis-
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<PAGE>
trable Securities of its intention to do so and of such holders' rights under
this Section and, upon the written request of any holder of Registrable
Securities given to the Company within 30 days after the Company has given any
such notice (which request shall specify the Registrable Securities intended to
be disposed of by such holder and the intended method of disposition thereof),
the Company will use its best efforts to effect the registration under the
Securities Act of all Registrable Securities which the Company has been so
requested to register by the holders thereof, to the extent required to permit
the disposition (in accordance with the intended methods thereof as aforesaid)
of the Registrable Securities so to be registered, provided that:
(a) if such registration shall be in connection with the initial
public offering of Common Stock, the Company shall not include any
Registrable Securities in such proposed registration if the Board shall
have determined, after consultation with the managing underwriters for
such offering, that it is not in the best interests of the Company to
include any Registrable Securities in such registration, provided that, if
the Board makes such a determination, the Company shall not include in
such registration any securities not being sold for the account of the
Company;
(b) if, at any time after giving written notice of its intention to
register any securities and prior to the effective date of the
registration statement filed in connection with such registration, the
Company shall determine for any reason not to register such securities,
the Company may, at its election, give written notice of such
determination to each holder of Registrable Securities or other securities
that was previously notified of such registration and, thereupon, shall
not register any Registrable Securities in connection with such
registration (but shall nevertheless pay the Registration Expenses in
connection therewith), without prejudice, however, to the rights of any
holder or holders of Registrable Securities to request that a registration
be effected under Section 3.1;
(c) if the Company shall be advised in writing by the managing
underwriters (or, in connection with an offering which is not
underwritten, by an investment banker) (and the Company shall so advise
each holder of Registrable Securities requesting registration of such
advice) that in their or its opinion the number of securities requested to
be included in such registra-
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<PAGE>
tion (whether by the Company, pursuant to this Section 3.2 or pursuant to
any other rights granted by the Company to a holder or holders of its
securities to request or demand such registration or inclusion of any such
securities in any such registration) exceeds the number of such securities
which can be sold in such offering,
(i) the Company shall include in such registration the number
(if any) of Registrable Securities so requested to be included which
in the opinion of such underwriters or investment banker, as the
case may be, can be sold and shall not include in such registration
any securities (other than securities being sold by the Company,
which shall have priority in being included in such registration) so
requested to be included other than Registrable Securities unless
all Registrable Securities requested to be so included are included
therein, and
(ii) if in the opinion of such underwriters or investment
banker, as the case may be, some but not all of the Registrable
Securities may be so included, all holders of Registrable Securities
requested to be included therein shall share pro rata in the number
of shares of Registrable Securities included in such public offering
on the basis of the number of Registrable Securities requested to be
included therein by such holders, provided that, in the case of a
registration initially requested or demanded by a holder or holders
of securities other than Registrable Securities, the holders of the
Registrable Securities requested to be included therein and the
holders of such other securities shall share pro rata (based on the
number of shares if the requested or demanded registration is to
cover only Common Stock and, if not based on the proposed offering
price of the total number of securities included in such public
offering requested to be included therein),
and the Company shall so provide in any registration agreement hereinafter
entered into with respect to any of its securities; and
(d) if prior to the effective date of the registration statement
filed in connection with such registration, the Company is informed by the
managing underwriter (or, in connection with an offering which is not
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<PAGE>
underwritten, by an investment banker) that the price at which such
securities are to be sold is a price below that price which the Requesting
Holders shall have indicated to be acceptable, the Company shall promptly
notify the Requesting Holders of such fact, and each such Requesting
Holder shall have the right to withdraw its request to have its
Registrable Securities included in such registration statement.
The Company will pay all Registration Expenses in connection with
each registration of Registrable Securities requested pursuant to this Section
3.2. No registration effected under this Section 3.2 shall relieve the Company
from its obligation to effect registrations upon request under Section 3.1.
3.3. Registration Procedures. If and whenever the Company is
required to use its best efforts to effect the registration of any Registrable
Securities under the Securities Act as provided in Sections 3.1 and 3.2, the
Company will promptly:
(a) subject to clauses (x) and (y) of Section 3.1(b), prepare and
file with the Securities and Exchange Commission a registration statement
with respect to such securities, make all required filings with the NASD
and use best efforts to cause such registration statement to become
effective;
(b) prepare and file with the Securities and Exchange Commission
such amendments and supplements to such registration statement and the
prospectus used in connection therewith and such other documents as may be
necessary to keep such registration statement effective and to comply with
the provisions of the Securities Act with respect to the disposition of
all securities covered by such registration statement until such time as
all of such securities have been disposed of in accordance with the
intended methods of disposition by the seller or sellers thereof set forth
in such registration statement, but in no event for a period of more than
six months after such registration statement becomes effective;
(c) furnish to counsel (if any) selected by the holders of a
majority (by number of shares) of the Registrable Securities covered by
such registration statement copies of all documents proposed to be filed
with the Securities and Exchange Commission in connection with such
registration, which documents will be subject to the review of such
counsel;
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<PAGE>
(d) furnish to each seller of such securities, without charge, such
number of conformed copies of such registration statement and of each such
amendment and supplement thereto (in each case, including all exhibits and
documents filed therewith (other than those filed on a confidential
basis), except that the Company shall not be obligated to furnish any
seller of securities with more than two copies of such exhibits and
documents), such number of copies of the prospectus included in such
registration statement (including each preliminary prospectus and any
summary prospectus) in conformity with the requirements of the Securities
Act, and such other documents, as such seller may reasonably request in
order to facilitate the disposition of the securities owned by such
seller;
(e) use its best efforts (x) to register or qualify the securities
covered by such registration statement under such other securities or blue
sky laws of such jurisdictions as each seller shall request, (y) to keep
such registration or qualification in effect for so long as such
registration statement remains in effect and (z) to do any and all other
acts and things which may be necessary or advisable to enable such seller
to consummate the disposition in such jurisdictions of the securities
owned by such seller, except that the Company shall not for any such
purpose be required to qualify generally to do business as a foreign
corporation in any jurisdiction wherein it is not so qualified, subject
itself to taxation in any jurisdiction wherein it is not so subject, or
take any action which would subject it to general service of process in
any jurisdiction wherein it is not so subject;
(f) in connection with an underwritten public offering only, furnish
to each seller a signed counterpart, addressed to the sellers, of
(i) an opinion of counsel for the Company experienced in
securities law matters, dated the effective date of the registration
statement, and
(ii) a "comfort" letter signed by the independent public
accountants who have issued an audit report on the Company's
financial statements included in the registration statement, subject
to such seller having executed and delivered to the independent
public accountants such certificates and documents as such
accountants shall reasonably request and provided that such
accountants shall be permitted by the standards applicable to
certi-
14
<PAGE>
fied public accountants to deliver a "comfort" letter to such
seller,
covering substantially the same matters with respect to the registration
statement (and the prospectus included therein) and, in the case of such
accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's
counsel and in accountants' letters delivered to the underwriters in
underwritten public offerings of securities;
(g)(i) notify each holder of Registrable Securities covered by such
registration statement if such registration statement, at the time it or
any amendment thereto became effective, (x) contained an untrue statement
of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading
upon discovery by the Company of such material misstatement or omission or
(y) upon discovery by the Company of the happening of any event as a
result of which the Company believes there would be such a material
misstatement or omission, and, as promptly as practicable, prepare and
file with the Securities and Exchange Commission a post-effective
amendment to such registration statement and use best efforts to cause
such post-effective amendment to become effective such that such
registration statement, as so amended, shall not 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 (ii) notify each holder of Registrable Securities covered
by such registration statement, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, if the
prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading upon discovery by the Company of such material
misstatement or omission or upon discovery by the Company of the happening
of any event as a result of which the Company believes there would be a
material misstatement or omission, and, as promptly as is practicable,
prepare and furnish to such holder a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so
that, as thereafter delivered to the purchasers of such securities, such
prospectus shall not include an untrue
15
<PAGE>
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading;
(h) otherwise use its best efforts to comply with all applicable
rules and regulations of the Securities and Exchange Commission, and make
available to its security holders, as soon as reasonably practicable, an
earnings statement of the Company complying with the provisions of Section
11(a) of the Securities Act and Rule 158 under the Securities Act;
(i) notify each seller of any securities covered by such
registration statement (i) when such registration statement, or any
post-effective amendment to such registration statement, shall have become
effective, or any amendment of or supplement to the prospectus used in
connection therewith shall have been filed, (ii) of any request by the
Securities and Exchange Commission to amend such registration statement or
to amend or supplement such prospectus or for additional information,
(iii) of the issuance by the Securities and Exchange Commission of any
stop order suspending the effectiveness of such registration statement or
of any order preventing or suspending the use of any preliminary
prospectus, and (iv) of the suspension of the qualification of such
securities for offering or sale in any jurisdiction, or of the institution
of any proceedings for any of such purposes;
(j) use its best efforts (i) (A) to list such securities on any
securities exchange on which the Common Stock is then listed or, if no
Common Stock is then listed, on an exchange selected by the Company, if
such listing is then permitted under the rules of such exchange or (B) if
such listing is not practicable or the Board determines that quotation as
a NASDAQ National Market System security is preferable, to secure
designation of such securities as a NASDAQ "national market system
security" within the meaning of Rule 11Aa2-1 under the Exchange Act and
(ii) to provide and cause to be maintained a transfer agent and registrar
for such Registrable Securities not later than the effective date of such
registration statement; and
(k) use every reasonable effort to obtain the lifting of any stop
order that might be issued suspending the effectiveness of such
registration statement or of any order preventing or suspending the use of
any preliminary prospectus, provided that if the Company is
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<PAGE>
unable to obtain the lifting of any such stop order in connection with a
registration pursuant to Section 3.1(a), the request for registration
shall not be deemed exercised for purposes of determining whether such
registration has been effected for purposes of Section 3.1(a) or (d).
The Company may require each seller of any securities as to which
any registration is being effected to furnish to the Company such information
regarding such seller and the distribution of such securities as the Company may
from time to time reasonably request in writing and as shall be required by law
in connection therewith. Each such holder agrees to furnish promptly to the
Company all information required to be disclosed in order to make the
information previously furnished to the Company by such holder not materially
misleading.
The Company agrees not to file or make any amendment to any
registration statement with respect to any Registrable Securities, or any
amendment of or supplement to the prospectus used in connection therewith, which
refers to any seller of any securities covered thereby by name, or otherwise
identifies such seller as the holder of any securities of the Company, without
the consent of such seller, such consent not to be unreasonably withheld, except
that no such consent shall be required for any disclosure that is required by
law.
By acquisition of Registrable Securities, each holder of such
Registrable Securities shall be deemed to have agreed that upon receipt of any
notice from the Company pursuant to Section 3.3(g), such holder will promptly
discontinue such holder's disposition of Registrable Securities pursuant to the
registration statement covering such Registrable Securities until such holder
shall have received, in the case of clause (i) of Section 3.3(g), notice from
the Company that such registration statement has been amended, as contemplated
by Section 3.3(g), and, in the case of clause (ii) of Section 3.3(g), copies of
the supplemented or amended prospectus contemplated by Section 3.3(g). If so
directed by the Company, each holder of Registrable Securities will deliver to
the Company (at the Company's expense) all copies, other than permanent file
copies, in such holder's possession of the prospectus covering such Registrable
Securities at the time of receipt of such notice. In the event that the Company
shall give any such notice, the period mentioned in Section 3.3(b) shall be
extended by the number of days during the period from and including the date of
the giving of such notice to and including the date when each seller of any
Registrable Securities covered by such
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<PAGE>
registration statement shall have received the copies of the supplemented or
amended prospectus contemplated by Section 3.3(g).
3.4. Underwritten Offerings. The provisions of this Section 3.4 do
not establish additional registration rights but instead set forth procedures
applicable, in addition to those set forth in Sections 3.1 through 3.3, to any
registration which is an underwritten offering.
(a) Underwritten Offerings Exclusive. Whenever a registration
requested pursuant to Section 3.1 is for an underwritten offering, only
securities which are to be distributed by the underwriters may be included in
the registration.
(b) Underwriting Agreement. If requested by the underwriters for any
underwritten offering by holders of Registrable Securities pursuant to a
registration requested under Section 3.1(a), the Company shall enter into an
underwriting agreement with such underwriters for such offering, such agreement
to be reasonably satisfactory in substance and form to the holders of a majority
(by number of shares) of the Registrable Securities to be covered by such
registration and to the underwriters and to contain such representations and
warranties by the Company and such other terms and provisions as are customarily
contained in agreements of this type, including, but not limited to, indemnities
to the effect and to the extent provided in Section 3.7, provisions for the
delivery of officers' certificates, opinions of counsel and accountants'
"comfort" letters and hold-back arrangements. The holders of Registrable
Securities to be distributed by such underwriters shall be parties to such
underwriting agreement and may, at their option, require that any or all of the
representations and warranties by, and the agreements on the part of, the
Company to and for the benefit of such underwriters be made to and for the
benefit of such holders of Registrable Securities and that any or all of the
conditions precedent to the obligations of such underwriters under such
underwriting agreement shall also be conditions precedent to the obligations of
such holders of Registrable Securities. In the event that any condition to the
obligations under any such underwriting agreement are not met or waived, and
such failure to be met or waived is not attributable to the fault of the selling
stockholders requesting a demand registration pursuant to Section 3.1(a), such
request for registration shall not be deemed exercised for purposes of
determining whether such registration has been effected for purposes of Section
3.1(a) or (d). No holder of Registrable Securities shall be required by the
Company to make any representations
18
<PAGE>
or warranties to, or agreements with, the Company or the underwriters other than
as set forth in Sections 3.4(e) and 3.7(b), representations, warranties or
agreements regarding such holder and such holder's intended method of
distribution and any other representations required by applicable law.
(c) Selection of Underwriters. Whenever a registration requested
pursuant to Section 3.1(a) is for an underwritten offering, the Company will
have the right to select the managing underwriters to administer the offering,
which managing underwriters shall be underwriters of nationally recognized
standing. If the Company at any time proposes to register any of its securities
under the Securities Act for sale for its own account and such securities are to
be distributed by or through one or more underwriters, the Company will have the
right to select the managing underwriters to administer the offering at least
one of which shall be an underwriter of nationally recognized standing.
(d) Incidental Underwritten Offerings. Subject to the provisions of
the proviso to the first sentence of Section 3.2, if the Company at any time
proposes to register any of its equity securities under the Securities Act
(other than pursuant to Section 3.1 or pursuant to a Special Registration),
whether or not for its own account, and such securities are to be distributed by
or through one or more underwriters, the Company will give prompt written notice
to all holders of Registrable Securities of its intention to do so and, if
requested by any holder of Registrable Securities, will use its best efforts to
arrange for such underwriters to include the Registrable Securities to be
offered and sold by such holder among those to be distributed by such
underwriters. The holders of Registrable Securities to be distributed by such
underwriters shall be parties to the underwriting agreement between the Company
and such underwriters and may, at their option, require that any or all of the
representations and warranties by, and the other agreements on the part of, the
Company to and for the benefit of such underwriters shall also be made to and
for the benefit of such holders of Registrable Securities and that any or all of
the conditions precedent to the obligations of the underwriters under such
underwriting agreement shall also be conditions precedent to the obligations of
such holders of Registrable Securities. No such holder of Registrable Securities
shall be required by the Company to make any representations or warranties to,
or agreements with, the Company or the underwriters other than as set forth in
Sections 3.4(e) and 3.7(b), representations, warranties or agreements regarding
such holder and such holder's intended
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<PAGE>
method of distribution and any other representations required by applicable law.
(e) Hold Back Agreements. If and whenever the Company proposes to
register any of its equity securities under the Securities Act, whether or not
for its own account (other than pursuant to a Special Registration), or is
required to use its best efforts to effect the registration of any Registrable
Securities under the Securities Act pursuant to Section 3.1 or 3.2, each holder
of Registrable Securities agrees by acquisition of such Registrable Securities
not to effect (other than pursuant to such registration) any public sale or
distribution, including, but not limited to, any sale pursuant to Rule 144 or
Rule 144A, of any Registrable Securities, any other equity securities of the
Company or any securities convertible into or exchangeable or exercisable for
any equity securities of the Company for 180 days after, and during the 20 days
prior to, the effective date of such registration and the Company agrees to
cause each holder of any equity security, or of any security convertible into or
exchangeable or exercisable for any equity security, of the Company purchased
from the Company at any time other than in a Public Offering to enter into a
similar agreement with the Company. The Company further agrees not to effect
(other than pursuant to such registration or pursuant to a Special Registration)
any public sale or distribution, or to file any registration statement (other
than such registration or a Special Registration) covering any, of its equity
securities, or any securities convertible into or exchangeable or exercisable
for such securities, during the 20 days prior to, and for 180 days after, the
effective date of such registration if required by the managing underwriter.
3.5. Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement registering Registrable
Securities under the Securities Act, the Company will give the holders of such
Registrable Securities so to be registered and their underwriters, if any, and
their respective counsel and accountants the opportunity to participate in the
preparation of such registration statement, each prospectus included therein or
filed with the Securities and Exchange Commission, and each amendment thereof or
supplement thereto, and will give each of them such access to its books and
records and such opportunities to discuss the business of the Company with its
officers and the independent public accountants who have issued audit reports on
its financial statements as shall be necessary, in the opinion of such holders'
and such underwriters' respective counsel, to con-
20
<PAGE>
duct a reasonable investigation within the meaning of the Securities Act.
3.6. Other Registrations. If and whenever the Company is required to
use its best efforts to effect the registration of any Registrable Securities
under the Securities Act pursuant to Section 3.1 or 3.2, and if such
registration shall not have been withdrawn or abandoned, the Company shall not
be obligated to and shall not file any registration statement with respect to
any of its securities (including Registrable Securities) under the Securities
Act (other than a Special Registration), whether of its own accord or at the
request or demand of any holder or holders of such securities, until a period of
six months shall have elapsed from the effective date of such previous
registration; and the Company shall so provide in any registration rights
agreement with respect to any of its equity securities.
3.7. Indemnification.
(a) Indemnification by the Company. In the event of any registration
of any Registrable Securities under the Securities Act pursuant to Section 3.1
or 3.2, the Company will and hereby does indemnify and hold harmless each seller
of such securities, its directors, officers, and employees, each other person
who participates as an underwriter, broker or dealer in the offering or sale of
such securities and each other person, if any, who controls such seller or any
such participating person within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, against any and all losses,
claims, damages or liabilities, joint or several, to which such seller or any
such director, officer, employee, participating person or controlling person may
become subject under the Securities Act or otherwise (including, without
limitation, the reasonable fees and expenses of legal counsel incurred in
connection with any claim for indemnity hereunder), insofar as such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
arise out of or are based upon (i) any untrue statement or alleged untrue
statement of a fact contained in any registration statement under which such
securities were registered under the Securities Act, any preliminary prospectus,
final prospectus or summary prospectus contained therein or related thereto, or
any amendment or supplement thereto, or (ii) any omission or alleged omission to
state a fact required to be stated in any such registration statement,
preliminary prospectus, final prospectus, summary prospectus, amendment or
supplement or necessary to make the statements therein not misleading; and the
Company will reimburse such seller and each such direc-
21
<PAGE>
tor, officer, employee, participating person and controlling person for any
legal or any other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, liability, action or
proceeding, provided that the Company shall not be liable in any such case to
the extent that any such loss, claim, damage, liability or expense arises out of
or is based upon an untrue statement or omission made in such registration
statement, any such preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement in reliance upon and in conformity with
written information furnished to the Company by such seller or participating
person expressly for use in the preparation thereof and provided, further, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or expense arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission in
the prospectus, if such untrue statement or alleged untrue statement or omission
or alleged omission is completely corrected in an amendment or supplement to the
prospectus and the seller of Registrable Securities thereafter fails to deliver
such prospectus as so amended or supplemented prior to or concurrently with the
sale of Registrable Securities to the person asserting such loss, claim, damage,
liability or expense after the Company had furnished such seller with a
sufficient number of copies of the same or if the seller received notice from
the Company of the existence of such untrue statement or alleged untrue
statement or omission or alleged omission and the seller continued to dispose of
Registrable Securities prior to the time of the receipt of either (A) an amended
or supplemented prospectus which completely corrected such untrue statement or
omission or (B) a notice from the Company that the use of the existing
prospectus may be resumed. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such seller or any such
director, officer, employee, participating person or controlling person and
shall survive the transfer of such securities by such seller.
(b) Indemnification by the Sellers. In the event of any registration
of any Registrable Securities under the Securities Act pursuant to Section 3.1
or 3.2, each of the prospective sellers of such securities will indemnify and
hold harmless the Company, each director of the Company, each officer of the
Company who shall sign such registration statement, each other person who
participates as an underwriter, broker or dealer in the offering or sale of such
securities and each other person, if any, who controls the Company or any such
participating person within the meaning of Section 15 of the Securities Act or
Section 20 of the
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<PAGE>
Exchange Act, against any and all losses, claims, damages or liabilities, joint
or several, to which the Company or any such director, officer, employee,
participating person or controlling person may become subject under the
Securities Act or otherwise (including, without limitation, the reasonable fees
and expenses of legal counsel incurred in connection with any claim for
indemnity hereunder), insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a fact contained in, or any
omission or alleged omission to state a fact with respect to such seller
required to be stated in, any registration statement under which such securities
were registered under the Securities Act, any preliminary prospectus, final
prospectus or summary prospectus contained therein or related thereto, or any
amendment or supplement thereto, if such statement or omission was made in
reliance upon and in conformity with written information furnished to the
Company by such seller expressly for use in the preparation of such registration
statement, preliminary prospectus, final prospectus, summary prospectus,
amendment or supplement; and the seller will reimburse the Company and each such
director, officer, employee, participating person and controlling person for any
legal or any other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, liability, action or
proceeding, provided that the liability of each such seller will be in
proportion to and limited to the net amount received by such seller (after
deducting any underwriting discount and expenses) from the sale of Registrable
Securities pursuant to such registration statement. Such indemnity shall remain
in full force and effect regardless of any investigation made by or on behalf of
the Company or any such director, officer, participating person or controlling
person and shall survive the transfer of such securities by such seller.
(c) Notices of Claims, etc. Promptly after receipt by an indemnified
party of notice of the commencement of any action or proceeding involving a
claim referred to in the preceding paragraphs of this Section 3.7, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party hereunder, give written notice to the latter of the
commencement of such action, provided that the failure of any indemnified party
to give notice as provided therein shall not relieve the indemnifying party of
its obligations under the preceding paragraphs of this Section 3.7. In case any
such action is brought against an indemnified party, the indemnifying party will
be entitled to participate therein and to assume the defense thereof, jointly
with any other indemnifying party similarly
23
<PAGE>
notified to the extent that it may wish, with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party for any legal or
other expenses subsequently incurred by the latter in connection with the
defense thereof, provided that if such indemnified party and the indemnifying
party reasonably determine, based upon advice of their respective independent
counsel, that a conflict of interest may exist between the indemnified party and
the indemnifying party with respect to such action and that it is advisable for
such indemnified party to be represented by separate counsel, such indemnified
party may retain other counsel, reasonably satisfactory to the indemnifying
party, to represent such indemnified party, and the indemnifying party shall pay
all reasonable fees and expenses of such counsel. No indemnifying party, in the
defense of any such claim or litigation, shall, except with the consent of such
indemnified party, which consent shall not be unreasonably withheld, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect to such claim or
litigation.
(d) Other Indemnification. Indemnification similar to that specified
in the preceding paragraphs of this Section 3.7 (with appropriate modifications)
shall be given by the Company and each seller of Registrable Securities with
respect to any required registration or other qualification of such Registrable
Securities under any Federal or state law or regulation of governmental
authority other than the Securities Act.
(e) Other Remedies. If for any reason the foregoing indemnity under
Section 3.7(a) or (b) is unavailable, or is insufficient to hold harmless an
indemnified party, other than by reason of the exceptions provided therein, then
the indemnifying party and the indemnified party under Section 3.7(a) or (b)
shall contribute to the amount paid or payable by the indemnified party as a
result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party on the one hand and the indemnified party on the other or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, or
provides a lesser sum to the indemnified party than the amount hereinafter
calculated, in such proportion as is appropriate to reflect not only the
relative fault of the indemnifying party on the one hand and the indemnified
party
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<PAGE>
on the other but also the relative benefits received by the indemnifying party
and the indemnified party from the offering of Registrable Securities (taking
into account the portion of the proceeds of the offering realized by each such
party) as well as any other relevant equitable considerations. 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. Any party's obligation to
contribute pursuant to this Section 3.7(e) is several (in proportion to the
relative value of their Registrable Securities covered by a registration
statement) and not joint with the obligations of any other party. No party shall
be liable for contribution under this Section 3.7(e) except to the extent and
under such circumstances as such party would have been liable to indemnify under
this Section 3.7 if such indemnification were enforceable under applicable law.
(f) Officers and Directors. As used in this Section 3.7, the terms
"officers" and "directors" shall include the partners of the holders of
Registrable Securities which are partnerships.
(g) Indemnification Payments. The indemnification and contribution
required by this Section 3.7 shall be made by periodic payments of the amount
thereof during the course of the investigation or defense, as and when bills are
received or expense, loss, damage or liability is incurred; provided that in the
event it is ultimately determined that any amounts so paid were not subject to
indemnification or contribution hereunder, the recipient thereof shall promptly
return such amounts to payor thereof.
4. Participation Rights. So long as any Registrable Securities
remain outstanding and a Public Market has not been established with respect to
the Common Stock, the CD&R Fund hereby agrees not to make any sale or transfer
of Common Stock owned by the CD&R Fund which would constitute a Qualifying Sale,
except pursuant to the following provisions of this Section 4:
(a) Procedures for Qualifying Sales. At least 30 days prior to
making any Qualifying Sale, the CD&R Fund will deliver a written notice (the
"Sale Notice") to the Company and the other holders of Registrable Securities.
The Sale Notice will fully disclose the identity of the prospective transferee
and the terms and conditions of the proposed Qualifying Sale, including the
number of shares of Common Stock that the prospective transferee is willing to
purchase and the intended consummation date of such Qualifying Sale.
25
<PAGE>
The CD&R Fund agrees not to consummate any Qualifying Sale until at least 30
days after the related Sale Notice has been given to each holder of Registrable
Securities, unless the CD&R Fund shall have received a notice from each holder
of Registrable Securities indicating whether or not such holder has elected to
participate in such Qualifying Sale and the number of shares of Common Stock to
be sold by each such holder so electing to participate has been finally
determined pursuant hereto prior to the expiration of such 30-day period. Each
holder of Registrable Securities may elect to participate in the contemplated
Qualifying Sale by giving written notice to the CD&R Fund and the Company within
30 days after the CD&R Fund has given the related Sale Notice to such holder. If
a holder of Registrable Securities elects to participate, such holder will be
entitled to sell in the contemplated Qualifying Sale, at the same price and on
the same terms and conditions as set forth in the related Sale Notice, an amount
of Registrable Securities equal to the product of (i) the quotient determined by
dividing (A) the percentage of Registrable Securities then held by such holder
of Registrable Securities so electing to participate by (B) the aggregate
percentage of Registrable Securities represented by the Registrable Securities
then held by the CD&R Fund and all holders of Registrable Securities so electing
to participate and (ii) the number of shares of Registrable Securities such
transferee has agreed to purchase in the contemplated sale (or in the case of a
"Qualifying Sale" within the meaning of clause (ii) of Section 4(b), the Excess
Number of shares which such transferee has agreed to purchase), unless all such
holders otherwise agree themselves to a different allocation. If such right to
participate in a Qualifying Sale shall not have been exercised prior to the
expiration of the 30-day period, then at any time during the 90 days following
the expiration of the 30-day period, subject to extension for not more than an
additional 60 days to the extent reasonably required to comply with applicable
laws in connection with such purchase, the CD&R Fund may sell to the prospective
transferee the number of shares of Common Stock and at the price and on the
terms and conditions indicated in the Sale Notice. Upon receipt of a Sale
Notice, the Company will provide the CD&R Fund with a current list of holders of
Registrable Securities and their addresses.
(b) Qualifying Sale Defined. The term "Qualifying Sale" shall mean
(i) any sale or transfer of Common Stock proposed to be made by the CD&R Fund at
any time after the CD&R Fund has sold or transferred in the aggregate at least
the Qualifying Number of the shares of Common Stock or (ii) in the event that
prior to the sale or transfer by the CD&R Fund of an aggregate of the Qualifying
Number of shares
26
<PAGE>
of Common Stock, the CD&R Fund proposes to sell or transfer a number of shares
of Common Stock which when combined with any prior sales or transfers of such
shares by the CD&R Fund exceeds the Qualifying Number, the sale or transfer of a
number of shares (the "Excess Number") equal to the excess of (A) the sum of any
shares previously sold or transferred by the CD&R Fund and the aggregate number
of shares proposed to be sold or transferred in such contemplated sale, over (B)
the Qualifying Number of shares. In determining whether there is a "Qualifying
Sale," equitable adjustments shall be made to reflect any stock split, stock
dividend, stock combination, recapitalization or similar transaction.
(c) Exclusion from Qualifying Sale. The obligation of the CD&R Fund
and the rights of the holders of Registrable Securities pursuant to this Section
4 will not apply to any sale or transfer by the CD&R Fund pursuant to a
distribution to the public (whether pursuant to a registered Public Offering or
pursuant to Rule 144 or otherwise (but not pursuant to Rule 144A under the
Securities Act or any successor provision)). Any shares referred to, or covered
by any sale, transfer or distribution referred to, in the preceding sentence
shall not be included in the computation of "Qualifying Sale."
5. Investors' Rights to Purchase Additional Capital Stock.
(a) CD&R Sale. If at any time after the date of this Agreement and
prior to the establishment of a Public Market with respect to the Common Stock,
the Company shall propose to issue or sell any additional shares of its capital
stock (or any securities that may be exchanged for or converted into such
capital stock) to the CD&R Fund or any Affiliate of the CD&R Fund (a "CD&R
Sale"), the Company shall offer to each holder of Registrable Securities that is
an accredited investor (as such term is defined in Rule 501 of Regulation D
under the Securities Act) the right to purchase that number of additional shares
of the Company's capital stock (or such other security), on the same terms and
conditions as the proposed CD&R Sale, such that such holder would have the
opportunity to hold the same percentage of shares of the Company's capital stock
(on a fully diluted basis) after giving effect to the CD&R Sale, as such holder
held immediately prior thereto (an "Offer"). Notwithstanding the foregoing, none
of the following transactions shall constitute a CD&R Sale: the issuance by the
Company of any shares of its capital stock (or any securities that may be
exchanged for or converted into such capital stock) (A) pursuant to the
transactions described in Section 1, or (B) in exchange for Common Stock.
27
<PAGE>
(b) Offer Procedures. The Company shall make an Offer by delivering
to each holder of Registrable Securities at least 30 Business Days' prior
written notice of the proposed CD&R Sale. Such notice will identify the class
and number of shares or amount of securities to be issued (the "Offered
Securities"), the proposed date of issuance and the price and other terms of the
issuance. Such notice will also include an offer to sell to each such holder
that number of the Offered Securities such that such holder would have the
opportunity to hold the same percentage of shares of the Company's capital stock
(on a fully diluted basis) after giving effect to the CD&R Sale, as such holder
held immediately prior thereto (such holder's "Proportionate Share"), at the
same price and on the same other terms as are proposed for such CD&R Sale, which
offer by its terms shall remain open for a period of 15 Business Days from the
date of receipt of such notice. Each such holder shall give notice to the
Company of its intention to accept an Offer prior to the end of the 15-Business
Day period of such Offer, setting forth such portion of the Offered Securities
which such holder elects to purchase. If any holder fails to subscribe for its
Proportionate Share of the Offered Securities, the other subscribing holders
shall be entitled to purchase such Offered Securities as are not subscribed for
by such holder in such proportion of the Offered Securities as they shall have
theretofore agreed to purchase until there are no unmet demands of subscribing
holders or all Offered Securities shall have been subscribed for. The Company
shall notify each holder five Business Days following the expiration of the
15-Business Day period described above of the amount of Offered Securities which
each such holder may purchase pursuant to the foregoing sentence, and each such
holder shall then have 10 Business Days from the delivery of such notice to
indicate such additional amount, if any, that such holder wishes to purchase.
Upon the closing of the CD&R Sale as to which the Company has given notice, such
holder shall purchase from the Company, and the Company shall sell to such
holders, the Offered Securities subscribed for by such holders on the terms
specified in the Offer, which shall be the same terms at which all other persons
or entities acquire such securities in connection with such sale or issuance. In
the event that such holders do not subscribe for all of the Offered Securities,
the Company shall have 30 Business Days from the end of the foregoing
15-Business Day or 30-Business Day period, whichever is applicable, to sell all
or any part of such Offered Securities as to which such holders have not
accepted an Offer to any other persons or entities, in all material respects on
terms and conditions that are no more favorable to such other persons or
entities or less favorable to the Company than those set forth in the Offer.
28
<PAGE>
Any Offered Securities not purchased by such holders or other persons or
entities in accordance with this Section 5 may not be sold or otherwise disposed
of by the Company until they are again offered to such holders under the
procedures specified in this Section 5.
6. Miscellaneous.
6.1. (a) Rule 144. If the Company shall have filed a registration
statement pursuant to Section 12 of the Exchange Act or a registration statement
pursuant to the Securities Act relating to any class of equity securities (other
than a registration statement pursuant to a Special Registration), the Company
covenants that it will file the reports required to be filed by it under the
Securities Act and the Exchange Act and the rules and regulations adopted by the
Securities and Exchange Commission thereunder (or, if the Company is not
required to file such reports, it will, upon the request of any holder of
Registrable Securities, make publicly available such information as necessary to
permit sales pursuant to Rule 144), and will take such further action as any
holder of Registrable Securities may reasonably request, all to the extent
required from time to time to enable such holder to sell shares of Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by (a) Rule 144, as such rule may be amended from
time to time, or (b) any successor rule or regulation hereafter adopted by the
Securities and Exchange Commission.
(b) Legend on Stock Certificates. In addition to such other legends
as may be required by the Company's Certificate of Incorporation or any Stock
Subscription Agreement pursuant to which Registrable Securities are issued, each
certificate or certificates representing Registrable Securities shall bear the
following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE ENTITLED TO THE
BENEFITS OF AND ARE BOUND BY THE OBLIGATIONS SET FORTH IN A
REGISTRATION AND PARTICIPATION AGREEMENT, DATED AS OF MARCH 30,
1998, AND ANY AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS THERETO,
AMONG THE COMPANY AND CERTAIN STOCKHOLDERS OF THE COMPANY AND
NEITHER THIS CERTIFICATE NOR THE SHARES REPRESENTED BY IT ARE
ASSIGNABLE OR OTHERWISE TRANSFERABLE EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF SUCH REGISTRATION AND PARTICIPATION AGREEMENT, A COPY
OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY."
29
<PAGE>
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
HOLDBACK PROVISIONS CONTAINED IN SECTION 3.4 OF THE REGISTRATION AND
PARTICIPATION AGREEMENT AND IN THE COMPANY'S CERTIFICATE OF
INCORPORATION, WHICH PROVISIONS PROHIBIT ANY TRANSFER OF SUCH SHARES
DURING THE 20 DAYS PRIOR TO AND THE 180 DAYS AFTER THE EFFECTIVE
DATE OF ANY REGISTRATION STATEMENT (SUBJECT TO CERTAIN LIMITED
EXCEPTIONS) FILED BY THE COMPANY FOR ANY OF THE SHARES OF THE
COMPANY, WITHOUT REGARD TO THE APPLICABILITY OF RULE 144 OR RULE
144A UNDER THE SECURITIES ACT."
The Company agrees that it will not issue new certificates for shares formerly
representing Registrable Securities without a legend unless such shares have
been sold to the public pursuant to an effective registration statement under
the Securities Act or Rule 144.
6.2. Amendments and Waivers. This Agreement may be amended, and the
Company may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, only if the Company shall have obtained the
written consent to such amendment, action or omission to act, of the holder or
holders of at least a majority of the shares of Registrable Securities. Each
holder of any Registrable Securities at the time or thereafter outstanding shall
be bound by any consent authorized by this Section 6.2, whether or not such
Registrable Securities shall have been marked to indicate such consent.
6.3. Nominees for Beneficial Owners. In the event that any
Registrable Securities are held by a nominee for the beneficial owner thereof,
the beneficial owner thereof may, at its election and unless notice is otherwise
given to the Company by the record owner, be treated as the holder of such
Registrable Securities for purposes of any request or other action by any holder
or holders of Registrable Securities pursuant to this Agreement or any
determination of any number or percentage of shares of Registrable Securities
held by any holder or holders of Registrable Securities contemplated by this
Agreement. If the beneficial owner of any Registrable Securities so elects, the
Company may require assurances reasonably satisfactory to it of such owner's
beneficial ownership of such Registrable Securities.
6.4. Successors, Assigns and Transferees. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns. In addition, and whether or not any express
30
<PAGE>
assignment shall have been made, the provisions of this Agreement which are for
the benefit of, or are binding upon the parties hereto other than the Company
shall also be for the benefit of, binding upon and enforceable by any subsequent
holder of any Registrable Securities, subject to the provisions respecting the
minimum numbers or percentages of shares of Registrable Securities required in
order to be entitled to certain rights, or to take certain actions, contained
herein.
6.5. Notices. All notices, requests, demands or other communications
provided for hereunder shall be in writing and shall be deemed to have been duly
given to any party (a) when delivered personally (by courier service or
otherwise), (b) when delivered by telex and confirmed by receipt of the proper
telex answerback, (c) five days after being mailed by first class mail, postage
prepaid (registered or certified mail, return receipt requested), (d) when
receipt acknowledged, if telecopied, or (e) the next business day after timely
delivery to the courier, if sent by overnight air courier guaranteeing next day
delivery, in each case to the applicable address set forth beneath its name on
the schedules hereto, or to such other address as such party may have designated
to the Company in writing, or if to any other holder of Registrable Securities
at the address of such holder in the stock record books of the Company, and if
to the Company or the CD&R Fund to the following addresses:
(i) if to the Company, to:
NA Holding Corporation
c/o North American Van Lines, Inc.
5001 U.S. HWY 30 West
P.O. Box 988
Ft. Wayne, Indiana 46801-0988
Attention: General Counsel
(ii) if to the CD&R Fund, to:
Clayton, Dubilier & Rice
Fund V Limited Partnership
1403 Foulk Road, Suite 106
Wilmington, DE 19803
Attention: General Partner
or at such other address or addresses as the Company or the CD&R Fund, as the
case may be, may have designated in writing to each holder of Registrable
Securities at the time outstanding. Copies of any notice or other communication
given under the Agreement shall also be given to:
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Clayton, Dubilier & Rice, Inc.
375 Park Avenue
New York, New York 10152
Facsimile: (212) 407-5252
Telephone: (212) 407-5200
Attention: Kevin J. Conway
and
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Facsimile: (212) 909-6836
Telephone: (212) 909-6435
Attention: Paul S. Bird, Esq.
Any party may give any notice or other communication in connection herewith
using any other means (including, but not limited to, personal delivery,
messenger service, facsimile, telex or ordinary mail), but no such notice or
other communication shall be deemed to have been duly given unless and until it
is actually received by the individual for whom it is intended.
6.6. No Inconsistent Agreements. The Company will not hereafter
enter into any agreement with respect to its securities which is inconsistent
with the rights granted to the holders of Registrable Securities by this
Agreement.
6.7. Remedies; Attorneys' Fees. Each holder of Registrable
Securities, in addition to being entitled to exercise all rights provided herein
or granted by law, including recovery of damages, will be entitled to specific
performance of its rights under this Agreement. The Company agrees that monetary
damages would not be adequate compensation for any loss incurred by reason of a
breach by it of any provision of this Agreement and hereby agrees to waive the
defense in any action for specific performance that a remedy at law would be
adequate. In any action or proceeding brought to enforce any provision of this
Agreement, the successful party shall be entitled to recover reasonable
attorneys' fees in addition to its costs and expenses and other available
remedy.
6.8. Stock Splits, etc. Each party hereto agrees that it will vote
to effect a stock split (forward or reverse, as the case may be) with respect to
any Registrable Securities in connection with any registration of such
Registrable Securities hereunder, or otherwise, if the managing underwriter
shall advise the Company in writing (or, in connection with an offering that is
not underwritten, if an investment banker shall advise the Company in writing)
that in their or
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<PAGE>
its opinion such a stock split would facilitate or increase the likelihood of
success of the offering. Each party hereto agrees that any number of shares of
Common Stock referred to in this Agreement shall be equitably adjusted to
reflect any stock split, stock dividend, stock combination, recapitalization or
similar transaction.
6.9. Term. This Agreement shall be effective as of the date hereof
and shall continue in effect thereafter until the earliest of (a) its
termination by the consent of the parties hereto or their respective successors
in interest, (b) the date on which no Registrable Securities remain outstanding
and (c) the dissolution, liquidation or winding up of the Company.
6.10. Severability. If any provision of this Agreement is
inoperative or unenforceable for any reason, such circumstances shall not have
the effect of rendering the provision in question inoperative or unenforceable
in any other case or circumstance, or of rendering any other provision or
provisions herein contained invalid, inoperative, or unenforceable to any extent
whatsoever. The invalidity of any one or more phrases, sentences, clauses,
Sections or subsections of this Agreement shall not affect the remaining
portions of this Agreement.
6.11. Headings. The headings contained in this Agreement are for
purposes of convenience only and shall not affect the meaning or interpretation
of this Agreement.
6.12. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original and all of which
together constitute one and the same instrument.
6.13. Governing Law. This Agreement shall be governed in all
respects, including, but not limited to, as to validity, interpretation and
effect, by the internal laws of the State of New York without regard to
principles of conflicts of law.
6.14. No Third Party Beneficiaries. Except as provided in Sections
1(d), 3.7 and 6.4, nothing in this Agreement shall confer any rights upon any
Person other than the parties hereto and each such party's respective heirs,
successors and permitted assigns.
6.15. Consent to Jurisdiction. Each party irrevocably submits to the
exclusive jurisdiction of (a) the Supreme Court of the State of New York, New
York County, and (b) the United States District Court for the Southern District
of New
33
<PAGE>
York, for the purposes of any suit, action or other proceeding arising out of
this Agreement or any transaction contemplated hereby (and agrees not to
commence any such suit, action or proceeding except in such courts). Each party
further agrees that service of any process, summons, notice or document by U.S.
registered mail to such party's respective address set forth above shall be
effective service of process for any such suit, action or proceeding. Each party
irrevocably and unconditionally waives any objection to the laying of venue of
any such suit, action or proceeding in (i) the Supreme Court of the State of New
York, New York County, and (ii) the United States District Court for the
Southern District of New York, that any such suit, action or proceeding brought
in any such court has been brought in an inconvenient forum.
6.16. Waiver of Jury Trial. Each party hereby waives, to the fullest
extent permitted by applicable law, any right it may have to a trial by jury in
respect of any suit, action or proceeding arising out of this Agreement or any
transaction contemplated hereby. Each party (a) certifies that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce the foregoing waiver and (b) acknowledges that it and the other
parties have been induced to enter into the Agreement by, among other things,
the mutual waivers and certifications in this Section 6.16.
6.17. Entire Agreement. This Agreement constitutes the entire
agreement and supersedes all prior agreements and understandings, both written
and oral, among the parties with respect to the subject matter hereof.
34
<PAGE>
IN WITNESS WHEREOF, each of the undersigned has executed this
Agreement or caused this Agreement to be executed on its behalf as of the date
first written above.
NA HOLDING CORPORATION
By: /s/Kevin J. Conway
-------------------------------------
Name: Kevin J. Conway
Title: Vice President
CLAYTON, DUBILIER & RICE
FUND V LIMITED PARTNERSHIP
By: CD&R Associates V
Limited Partnership,
the general partner
By: CD&R Investment Associates II, Inc.
By: /s/Joseph L. Rice, III
---------------------------------
Name: Joseph L. Rice, III
Title: Chairman and Chief
Executive Officer
35
<PAGE>
Exhibit 10.9
Conformed Copy
AMENDMENT NO. 1 TO REGISTRATION AND PARTICIPATION AGREEMENT
AMENDMENT NO. 1, dated as of November 19, 1999 (the "Amendment"), to
the Registration and Participation Agreement, dated as of March 30, 1998 (the
"Agreement"), among NA Holding Corporation, a Delaware corporation (the
"Company") and Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman
Islands exempted limited partnership (together with any successor investment
vehicle managed by Clayton, Dubilier & Rice, Inc., the "CD&R Fund").
W I T N E S S E T H :
WHEREAS, the Company is a party to an Acquisition Agreement, dated
as of September 14, 1999, as amended from time to time (the "Acquisition
Agreement"), with NFC plc, a company organized under the laws of England and
Wales ("NFC"), pursuant to which the Company has issued as of the date hereof
174,961 shares of its Common Stock, par value $0.01 per share (the "Common
Stock") and has executed and delivered to NFC International Holdings
(Netherlands II) BV a Common Stock Purchase Warrant (the "Warrant") to purchase
87,480 shares of its Common Stock;
WHEREAS, the Company has entered into a Stock Subscription
Agreement, dated as of the date hereof, as amended from time to time (the "NFC
Subscription Agreement"), with NFC, pursuant to which the Company will issue and
sell to NFC, and NFC will purchase from the Company, on or before December 31,
1999, 56,338 shares of Common Stock;
WHEREAS, the Company has entered into a Stock Subscription
Agreement, dated as of the date hereof, as amended from time to time (the "CD&R
Fund Subscription Agreement") with the CD&R Fund, pursuant to which the Company
will issue and sell to the CD&R Fund, and the CD&R Fund will purchase from the
Company, on or before December 31, 1999, up to 281,690 shares of Common Stock
less such number of shares of Common Stock as NFC purchases on or before
December 31, 1999;
WHEREAS, in connection with the Acquisition Agreement, the Company,
North American Van Lines, Inc., NFC plc and the CD&R Fund have entered into a
Letter Agreement, dated as of the date hereof, as may be amended from time to
time, setting forth certain rights and obligations relating to the shares of the
Common Stock of the Company owned by NFC; and
WHEREAS, the Company and the CD&R Fund have agreed to amend the
Agreement and to make NFC a party to the Agreement, subject to the terms and
conditions of this Amendment;
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Definitions. Capitalized terms used herein without other definition are used
as defined in the Agreement.
2. Amendment to Section 2 of the Agreement.
(a) The definition of "Qualifying Number" is hereby amended by
deleting the words "and Individual Investors" in the third line thereof.
<PAGE>
(b) The definition "Registrable Securities" is hereby amended by
deleting "and" where it appears before clause "(c)" in the first sentence
thereof, by redesignating clause "(c)" as clause "(e)" and by adding new clauses
(c) and (d) to the first sentence thereof as follows:
"(c) any shares of Common Stock issued pursuant to the Acquisition
Agreement and upon exercise of the Warrant and any other shares of
Common Stock otherwise acquired by NFC or any of its Affiliates
pursuant to the NFC Stock Subscription Agreement or otherwise;"
"(d) any shares of Common Stock issued to the CD&R Fund pursuant to
the Second Fund Stock Subscription Agreement, and".
(c) The following new defined terms are hereby added to Section 2 in
alphabetical order:
"Acquisition Agreement": the Acquisition Agreement, dated as of
September 14, 1999, between the Company and NFC.
"NFC": NFC plc, a company organized under the laws of England and
Wales.
"NFC Stock Subscription Agreement": The stock subscription
agreement, dated as of the date hereof, between the Company and NFC relating to
the purchase by NFC of 56,338 shares of Common Stock.
"Second Fund Stock Subscription Agreement": The stock subscription
agreement, dated as of the date hereof, between the Company and the CD&R Fund
relating to the purchase by the Fund of up to 281,690 shares of Common Stock.
"Warrant": the Common Stock Purchase Warrant, dated as of November
19, 1999, to purchase 87,480 shares of Common Stock executed and delivered by
the Company to NFC International Holdings (Netherlands II) BV in connection with
the transactions contemplated by the Acquisition Agreement and any warrant to
purchase Common Stock issued in replacement or substitution of a portion or all
of such Warrant.
3. Amendment to Section 3 of the Agreement.
(a) Section 3.1(a) of the Agreement is hereby amended by adding
"(i)" before "Subject" in the first line thereof and adding a new subparagraph
(ii) thereto reading in its entirety as follows:
"(ii) Subject to the provisions of Section 3.6, at any time after six
months following the consummation of a Public Offering and so long as NFC
and its Affiliates owns at least 115,650 shares of Common Stock (as
adjusted for any stock split, share dividend, share recombination or
exchange), NFC shall have the right to make two written requests that
2
<PAGE>
the Company effect the registration under the Securities Act of all or
part of the Registrable Securities then held by NFC and any of its
Affiliates, which requests shall specify the intended method of
disposition thereof by NFC and any of its Affiliates, provided that the
minimum number of Registrable Securities covered by any such request shall
be equal to 115,650 shares of Common Stock."
(b) Section 3.1(b) of the Agreement is hereby amended by replacing
the reference to "Section 3.1" in subparagraph (x) thereof with a reference to
"Section 3.1(a)(i), by replacing the reference to "Section 3.1(a)" in
subparagraph (x) thereof with a reference to "Section 3.1(b)", and by replacing
the reference to "Section 3.1" in subparagraph (y) thereof with a reference to
"Section 3.1(a)(i)".
(c) Section 3.1(d) is hereby amended by replacing the first sentence
thereof in its entirety with the following:
"The Company will pay all Registration Expenses in connection with the
first three registrations which are effected as requested under Section
3.1(a)(i) and with the first registration which is requested pursuant to
Section 3.1(a)(ii), provided that if any pro rata allocation conducted in
accordance with Section 3.1(g) results in the registration of less than
80% of the shares of Registrable Securities for which NFC requested
registration pursuant to its first request under Section 3.1(a)(ii), then
NFC shall not be deemed to have used its first request for purposes of
either this Section 3.1(d) or Section 3.1(a)(ii)."
4. Amendment to Section 6.2. Section 6.2 is hereby amended by adding
after the word "Securities" at the end of the first sentence thereof the
following:
", provided, however, that so long as NFC or any of its Affiliates owns at
least 10% of the outstanding shares of Common Stock, this Agreement may
not be amended in a manner that adversely affects the rights of NFC or its
Affiliates under this Agreement without their prior written consent."
5. Amendment to make NFC a Party to this Agreement. The Agreement is
hereby amended to make NFC a party to the Agreement.
6. Miscellaneous. Except as expressly amended and modified hereby,
the Agreement is hereby reaffirmed.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed by their respective duly authorized representatives as of the
date first above written.
NA HOLDING CORPORATION
By /s/R. Barry Uber
--------------------------------------------
Name: R. Barry Uber
Title: President and Chief Executive Officer
CLAYTON, DUBILIER & RICE
FUND V LIMITED PARTNERSHIP
By CD&R Associates V Limited Partnership,
the general partner
By CD&R Investment Associates II, Inc.
By /s/Donald J. Gogel
-----------------------------------------
Name: Donald J. Gogel
Title: President and Chief Executive
Officer
NFC PLC
By /s/Jeremy Letchford
--------------------------------------------
Name: Jeremy Letchford
Title: Secretary
4
<PAGE>
Exhibit 10.10
Conformed Copy
NA HOLDING CORPORATION
NORTH AMERICAN VAN LINES, INC.
5001 U.S. Hwy 30 West
Fort Wayne, Indiana 46801
CLAYTON, DUBILIER & RICE FUND V
LIMITED PARTNERSHIP
1403 Foulk Road, Suite 106
Wilmington, DE 19803
As of November 19, 1999
NFC plc
66 Chiltern Street
London W1N 3LT England
Attention: Director of Legal Services
Ladies and Gentlemen:
Reference is made to the Acquisition Agreement, dated as of
September 14, 1999, as such agreement may be amended from time to time (the
"Acquisition Agreement"), between NA Holding Corporation (the "Company") and NFC
plc ("NFC"), the Registration and Participation Agreement, dated as of March 30,
1998, as amended as of November 19, 1999, as such agreement may be amended from
time to time (the "Registration and Participation Agreement"), between the
Company and Clayton, Dubilier & Rice Fund V Limited Partnership (the "CD&R
Fund"), the Stock Subscription Agreement, dated as of November 19, 1999, between
the Company and the CD&R Fund as such agreement may be amended by from time to
time (the "CD&R Fund Subscription Agreement"), and the Stock Subscription
Agreement, dated as of November 19, 1999, between the Company and NFC, as such
agreement may be amended from time to time (the "NFC Subscription Agreement").
Unless otherwise defined herein, all capitalized terms used in this letter
agreement (this "Agreement") shall have the meanings ascribed to such terms in
the Acquisition Agreement.
WHEREAS, pursuant to the transactions contemplated by the
Acquisition Agreement, the Company has issued to NFC International Holdings
(Netherlands II) BV 174,961 shares of the Common Stock (the "Common Stock"), par
value $0.01 per share of the Company, and pursuant to the NFC Subscription
Agreement, the Company will issue to NFC or one of its Subsidiaries 56,338
shares of the Common Stock of the Company (collectively with the 174,961 shares
of Common Stock issued pursuant to the Acquisition Agreement, the "Shares");
WHEREAS, the Shares are entitled to the benefits of and are bound by
the obligations set forth in the Registration and Participation Agreement;
<PAGE>
WHEREAS, pursuant to the transactions contemplated by the
Acquisition Agreement, the CD&R Fund Subscription Agreement and the NFC
Subscription Agreement, NFC will become a minority stockholder of the Company
and the CD&R Fund will remain the majority stockholder of the Company;
WHEREAS, pursuant to the transactions contemplated by the
Acquisition Agreement, Realcause Limited, a wholly owned Subsidiary of NFC, will
retain ownership of two shares (the "U.K. Shares") of the capital stock of
Pickfords Limited and
WHEREAS, the Company, NFC and the CD&R Fund wish to enter into this
Agreement in order to set forth their mutual agreement concerning certain rights
and obligations in respect of the Shares and the U.K. Shares held by NFC and
certain other matters with respect to the Common Stock and the Board of
Directors of the Company;
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. Board of Directors. (a) Composition; Nominees. (i)
Subject to the provisions of this Agreement, each of the Boards of Directors of
the Company and North American Van Lines, Inc. ("NAVL") (the "Boards") shall
consist initially of ten members and may be increased or decreased in accordance
with the by-laws of the Company and NAVL, respectively. The CD&R Fund shall be
entitled to nominate nine members to each of the Boards, four of whom shall not
be employed by either the Company, any of its Subsidiaries or Clayton, Dubilier
& Rice, Inc. (the "Independent Directors").
(ii) So long as NFC or any of its Affiliates owns 10% of the
outstanding shares of Common Stock (determined as if all of the shares issuable
to NFC or its Affiliates under the Warrant were outstanding and held by NFC),
NFC shall be entitled (i) to nominate one member to each of the Boards, (ii) to
be consulted by the CD&R Fund respecting the nomination of the first Independent
Director nominated after the date hereof to fill any vacancy created by the
death, disability, retirement, resignation or removal of any of the Independent
Directors that are members of the Boards as of the date hereof, and with respect
to every fourth nomination thereafter of a candidate to fill a vacancy on the
Boards created by the death, disability, retirement, resignation or removal of
an Independent Director and (iii) to nominate one member of the Audit Committee
of the Board of the Company. In the event that the number of authorized
directors of any of the Boards shall exceed ten and so long as NFC or any of its
Affiliates owns 10% of the outstanding shares of Common Stock (determined as if
all of the shares issuable to NFC or its Affiliates under the Warrant were
outstanding and held by NFC), (x) NFC shall have the right to nominate as many
more additional members to any such Boards as may be
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<PAGE>
required to prevent the percentage of NFC's representatives on each of the
Boards from falling below ten percent and (y) the CD&R Fund shall have the right
to nominate all other members to the Boards. NFC may elect, at its option, not
to exercise such rights to nominate or to be consulted with respect to the
nomination of directors of the Boards pursuant to this Section 1(a). The Company
and each of the other parties hereto agrees to take all steps within their
power, including voting any shares of Common Stock by them or any of their
Affiliates, to cause any person so nominated to be elected to the Boards.
(iii) So long as NFC is entitled to nominate a director pursuant to
this Section 1(a)(ii) and elects not to exercise such right, NFC shall have the
right to appoint a non-voting observer to attend all meetings of the Boards and
to receive copies of all materials sent to the members of the Boards in
connection with meetings of the Boards. The director nominated by NFC pursuant
to this Section 1(a) shall be entitled to receive the same compensation and
reimbursement of expenses that is paid to the Independent Directors of the
Boards and shall be provided with all materials sent to the members of the
Boards in connection with meetings of the Boards and the members of the
committees of the Board in connection with meetings of the committees of the
Board.
(iv) If NFC and any of its Affiliates ceases to own at least 10%
(determined as if all of the shares issuable to NFC or its Affiliates under the
Warrant were outstanding and held by NFC) of the outstanding shares of Common
Stock but continues to own at least 5% (determined as if all of the shares
issuable to NFC or its Affiliates under the Warrant were outstanding and held by
NFC) of the outstanding shares of Common Stock, it shall have the right to
appoint a non-voting observer to attend all meetings of the Boards and to
receive copies of all materials sent to the members of the Boards in connection
with meetings of the Boards.
(b) Removal and Replacement of Nominees. Any director nominated
pursuant to Section 1(a) by a party hereto may be removed at any time, with or
without cause, by such party (but only by such party), and each party hereto
shall take all steps within its power, including voting any shares of Common
Stock owned by such party or its Affiliates at a meeting of the stockholders of
the Company, to cause such director to be removed. At any time at which any
party shall have exercised its right to nominate a director pursuant to Section
1(a) above (including with respect to NFC's consultation rights) and a vacancy
shall be created on the Boards as a result of the death, disability, retirement,
resignation or removal, with or without cause, of a director nominated by such
party, (x) the Boards will request such party to nominate a candidate to fill
such vacancy or (y) in the event that a candidate to fill such vacancy is to be
elected at the next annual meeting of the stockholders of the Company, such
party shall have the right to nominate the individual to fill such vacancy, and
the provisions of paragraph 1(a) above shall apply with respect to the
nomination and election of such nominee to fill such vacancy.
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<PAGE>
(c) Other Subsidiary Boards. In the event that any employee of
Clayton, Dubilier & Rice, Inc. is appointed to the Board of Directors of any
Subsidiary of the Company ("Subsidiary Board") the provisions of Sections 1(a)
and (b) above setting forth the rights and conditions for the appointment of
directors and non-voting observers to the Boards of the Company and NAVL shall
apply mutatis mutandis with respect to the appointment of such persons to any
such Subsidiary Board.
Section 2. Restrictions on Transfer. Neither NFC, nor any of its
representatives, successors or assignees, shall Transfer, directly or
indirectly, any shares of Common Stock to any other Person other than an
Affiliate of NFC, except as provided in this Section 2. No Transfer of any
shares of Common Stock by NFC to an Affiliate of NFC will be effective, and the
Company shall not be required to register any such Transfer, until such
Affiliate has agreed in a writing addressed to the Company to be bound by the
terms of this Agreement.
Section 2.1. Legends. NFC acknowledges that the certificate or
certificates representing the Shares shall bear an appropriate legend, which
will include, without limitation, the following language:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TRANSFER
RESTRICTIONS (INCLUDING A RIGHT OF FIRST REFUSAL AND A HOLDBACK AGREEMENT)
SET FORTH IN A LETTER AGREEMENT, DATED AS OF NOVEMBER 19, 1999, AS SUCH
AGREEMENT MAY BE AMENDED FROM TIME TO TIME, AMONG NA HOLDING CORPORATION,
NORTH AMERICAN VAN LINES, INC., NFC PLC AND CLAYTON, DUBILIER & RICE FUND
V LIMITED PARTNERSHIP AND NEITHER THIS CERTIFICATE NOR THE SHARES
REPRESENTED BY IT ARE ASSIGNABLE OR OTHERWISE TRANSFERABLE EXCEPT IN
ACCORDANCE WITH THE PROVISIONS OF SUCH LETTER AGREEMENT, A COPY OF WHICH
IS ON FILE WITH THE SECRETARY OF NA HOLDING CORPORATION. THE SHARES
REPRESENTED BY THIS CERTIFICATE ARE ENTITLED TO CERTAIN OF THE BENEFITS OF
AND ARE BOUND BY THE OBLIGATIONS SET FORTH IN A REGISTRATION AND
PARTICIPATION AGREEMENT, DATED AS OF MARCH 30, 1998, AS AMENDED AS OF
NOVEMBER 19, 1999, AS SUCH AGREEMENT MAY BE AMENDED FROM TIME TO TIME,
AMONG NA HOLDING CORPORATION AND CERTAIN STOCKHOLDERS OF NA HOLDING
CORPORATION, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF NA HOLDING
CORPORATION.
4
<PAGE>
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE OR FOREIGN
SECURITIES LAWS AND MAY NOT BE TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS (i) (A) SUCH DISPOSITION IS PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, (B) THE HOLDER HEREOF SHALL HAVE DELIVERED TO NA HOLDING
CORPORATION AN OPINION OF COUNSEL, WHICH OPINION AND COUNSEL SHALL BE
REASONABLY SATISFACTORY TO NA HOLDING CORPORATION, TO THE EFFECT THAT SUCH
DISPOSITION IS EXEMPT FROM THE PROVISIONS OF SECTION 5 OF SUCH ACT OR (C)
A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION, REASONABLY
SATISFACTORY TO COUNSEL FOR NA HOLDING CORPORATION, SHALL HAVE BEEN
OBTAINED WITH RESPECT TO SUCH DISPOSITION AND (ii) SUCH DISPOSITION IS
PURSUANT TO REGISTRATION UNDER ANY APPLICABLE STATE SECURITIES LAWS OR AN
EXEMPTION THEREFROM."
Section 2.2. Notice of Proposed Transfer; Opinion of Counsel. Prior
to any Transfer of any shares of Common Stock that are not registered under an
effective registration statement under the Securities Act (other than a Transfer
pursuant to Rule 144 or any comparable rule under such Act), NFC shall give
written notice (a "Transfer Notice") to the Company of its intention to effect
such Transfer and shall comply in all other respects with this Section 2.2. Each
Transfer Notice shall describe the manner and circumstances of the proposed
Transfer in reasonable detail and be accompanied by an opinion of counsel (which
requirement may be waived by the Company), who shall be independent of NFC (but
who may be NFC's regular outside counsel), experienced in Securities Act matters
and reasonably satisfactory to the Company, to the effect that the proposed
Transfer may be effected without registration. Subject to Section 2.3, NFC shall
thereupon be entitled to Transfer the securities in question in accordance with
the terms of the Transfer Notice. Each share certificate, if any, issued upon or
in connection with such Transfer shall bear the restrictive legend set forth in
Section 2.1, unless, in the opinion of such counsel and of counsel to the
Company, such legend is no longer required to ensure compliance with the
Securities Act.
Section 2.3. Right of First Refusal. In the event that NFC desires
to accept an offer (which must be in writing and for cash, be irrevocable by its
terms for at least 60 days and be a bona fide offer as determined in good faith
by the Board of Directors of the Company or the Executive Committee thereof)
from any prospective purchaser to purchase shares of Common Stock at any time
owned by NFC, it shall give
5
<PAGE>
notice in writing to the Company and the CD&R Fund (i) designating the number of
shares of Common Stock proposed to be sold, (ii) naming the prospective
purchaser of such shares and (iii) specifying the price (the "Offer Price") at
and terms (the "Offer Terms") upon which NFC desires to sell the same. During
the 30-day period following receipt of such notice by the Company and the CD&R
Fund (the "First Refusal Period"), the Company shall have the right to purchase
from NFC no less than all the shares of Common Stock specified in such notice,
at the Offer Price and on the Offer Terms. The Company hereby undertakes to use
reasonable efforts to act as promptly as practicable following receipt of such
notice to determine whether it shall elect to exercise such right. If the
Company fails to exercise such right within the First Refusal Period, the CD&R
Fund shall have the right to purchase no less than all the shares of Common
Stock at the Offer Price and on the Offer Terms, at any time during the period
beginning on the earlier of (x) the end of the First Refusal Period and (y) the
date of receipt by the CD&R Fund of written notice that the Company has elected
not to exercise its rights under this Section 2.3 and ending 30 days thereafter
(the "Second Refusal Period"). The rights provided hereunder shall be exercised
by written notice to NFC given at any time during the applicable period. If such
right is exercised, the Company or the CD&R Fund, as the case may be, shall
deliver to NFC a certified or bank check for the Offer Price, payable to the
order of NFC, against delivery of the certificates or other instruments
representing the shares of Common Stock so purchased, appropriately endorsed by
NFC. If such right shall not have been exercised prior to the expiration of the
Second Refusal Period, then at any time during the 30 days following the
expiration of the Second Refusal Period, NFC may sell such shares of Common
Stock to (but only to) the intended purchaser named in NFC's notice to the
Company and the CD&R Fund at the Offer Price and on the Offer Terms specified in
such notice, free of all restrictions or obligations imposed by, and free of any
rights or benefits set forth in Section 2 of this Agreement, provided that such
intended purchaser shall have agreed in writing to make and be bound by
representations, warranties and covenants regarding such purchaser's investment
intentions pursuant to an instrument of assumption satisfactory in substance and
form to the Company.
Section 2.4 Drag-Along Rights. (a) Drag-Along Notice. If the CD&R
Fund intends to effect a sale of 51% or more of its shares of Common Stock of
the Company to a Third Party Buyer and the CD&R Fund elects to exercise its
rights under this Section 2.4, the CD&R Fund shall deliver written notice (a
"Drag-Along Notice") to NFC, which notice shall (a) state (i) that the CD&R Fund
wishes to exercise its rights under this Section 2.4 with respect to such sale,
(ii) the name and address of the Third Party Buyer, (iii) the per share amount
and form of consideration the CD&R Fund proposes to receive for its shares of
Common Stock and (iv) the terms and conditions of payment of such consideration
and all other material terms and conditions of such sale, (b) contain an offer
(the "Drag-Along Offer") by the Third Party Buyer to purchase from NFC a
percentage of his shares of Common Stock equal to the percentage of the shares
of
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<PAGE>
Common Stock owned by the CD&R Fund that are to be sold to the Third Party Buyer
(such percentage, the "Applicable Percentage") at the same price and on and
subject to the same terms and conditions offered to the CD&R Fund and (c) state
the anticipated time and place of the closing of the purchase and sale of the
Applicable Percentage of the shares of Common Stock (a "Drag-Along Closing"),
which (subject to such terms and conditions) shall occur not fewer than five (5)
days nor more than ninety (90) days after the date such Drag-Along Notice is
delivered, provided that if such Drag-Along Closing shall not occur prior to the
expiration of such 90-day period, the CD&R Fund shall be entitled to deliver
additional Drag-Along Notices with respect to such Drag-Along Offer.
(b) Conditions to Drag-Along. Upon delivery of a Drag-Along Notice,
NFC shall have the obligation to sell and transfer to the Third Party Buyer the
Applicable Percentage of NFC's shares of Common Stock pursuant to the Drag-Along
Offer, as the same may be modified from time to time, provided that the CD&R
Fund sells and transfers the Applicable Percentage of its shares of Common Stock
to the Third Party Buyer at the Drag-Along Closing at the same price and on the
same terms and conditions. Within 10 days of receipt of the Drag-Along Notice,
NFC shall (i) execute and deliver to the CD&R Fund a power of attorney and a
letter of transmittal and custody agreement appointing, and in form and
substance reasonably satisfactory to, the CD&R Fund or one or more of its
affiliates designated by the CD&R Fund (the "Custodian"), the true and lawful
attorney-in-fact and custodian for NFC, with full power of substitution, and
authorizing the Custodian to take such actions as the Custodian may deem
necessary or appropriate to effect the sale and transfer of the Applicable
Percentage of the shares of Common Stock to the Third Party Buyer, upon receipt
of the purchase price therefor at the Drag-Along Closing, free and clear of all
security interests, liens, claims, encumbrances, charges, options, restrictions
on transfer (other than those stated on the stock certificate or the terms of
this Agreement), proxies and voting and other agreements of whatever nature, and
to take such other action as may be necessary or appropriate in connection with
such sale or transfer, including consenting to any amendments, waivers,
modifications or supplements to the terms of the sale (provided that the CD&R
Fund also so consents, and, to the extent applicable, sells and transfers the
Applicable Percentage of its shares of Common Stock on the same terms as so
amended, waived, modified or supplemented) and (ii) deliver to the Custodian
certificates representing the Applicable Percentage of the shares of Common
Stock, together with all necessary duly executed stock powers, provided that in
no event shall NFC be subject to any escrow or indemnification obligations in
connection with such sale without its prior written consent. The Custodian shall
hold the Applicable Percentage of the shares of Common Stock and other documents
in trust for NFC pending completion or abandonment of such sale. If, within 90
days after the CD&R Fund delivers the Drag-Along Notice, the CD&R Fund has not
completed the sale of the Applicable Percentage of the shares and of its shares
of Common Stock to the Third Party Buyer and another Drag-Along Notice with
respect to such Drag-Along Offer
7
<PAGE>
has not been sent to NFC, the Custodian shall return to NFC all certificates
representing the Applicable Percentage of the shares of Common Stock and all
other documents that NFC delivered in connection with such sale. Promptly after
the Drag-Along Closing, the Custodian shall give notice thereof to NFC, shall
remit to NFC the total consideration for the Applicable Percentage of the shares
of Common Stock sold pursuant thereto (reduced by any amount required to be held
in escrow as consented to by NFC and pursuant to the terms of any purchase and
sale agreement), and shall furnish such other evidence of the completion and
time of completion of such sale and the terms thereof as may reasonably be
requested by NFC.
(c) Remedies. NFC acknowledges that the CD&R Fund would be
irreparably damaged in the event of a breach or a threatened breach by NFC of
any of its obligations under this 2.4 and NFC agrees that, in the event of a
breach or a threatened breach by NFC of any such obligation, the CD&R Fund
shall, in addition to any other rights and remedies available to it in respect
of such breach, be entitled to an injunction from a court of competent
jurisdiction (without any requirement to post bond) granting it specific
performance by NFC of its obligations under this Section 2.4. In the event that
the CD&R Fund shall file suit to enforce the covenants contained in this 2.4 (or
obtain any other remedy in respect of any breach thereof), the prevailing party
in the suit shall be entitled to recover, in addition to all other damages to
which it may be entitled, the costs incurred by such party in conducting the
suit, including reasonable attorney's fees and expenses. In the event that,
following a breach or a threatened breach by NFC of the provisions of this
Section 2.4, the CD&R Fund does not obtain an injunction granting it specific
performance of the NFC's obligations under this 2.4 in connection with such
proposed sale prior to the time the CD&R Fund completes the sale of the
Applicable Percentage of its shares of Common Stock or, in its sole discretion,
abandons such sale, then the Company shall have the option to purchase all of
the shares of Common Stock from NFC at a purchase price per share equal to the
per share consideration payable pursuant to the Drag-Along Offer.
Section 2.5. Termination of Restrictions. (a) Securities Law
Restrictions. The legend requirements of Section 2.1 and the restrictions
imposed by Section 2.2 shall terminate as to any Shares (i) when and so long as
such Shares have been effectively registered under the Securities Act and
disposed of in accordance with the registration statement covering such Shares,
(ii) when, in the opinions of both counsel for NFC and counsel for the Company,
such restrictions are no longer required in order to insure compliance with the
Securities Act or (iii) when such Shares have been beneficially owned, by a
person who has not been an affiliate of the Company for at least three months,
for a period of at least two years, all as determined under Rule 144 under the
Securities Act. Whenever any such securities law restrictions shall terminate as
to any Shares, as soon as practicable thereafter and in any event within five
days, the holder thereof shall be entitled
8
<PAGE>
to receive from the Company and the Company agrees to issue to such holder,
without expense (other than transfer taxes, if any) and at the request of the
holder thereof, new securities of like tenor not bearing the second paragraph of
the legend set forth in Section 2.1 hereof. The legend requirements of the first
paragraph of the legend set forth in Section 2.1 hereof shall continue in effect
with respect to other transfer restrictions set forth herein and in the
Registration and Participation Agreement for so long as such restrictions remain
applicable and thereafter the Company agrees to reissue securities not bearing
any legend.
(b) Other Restrictions. The restrictions set forth in Sections 2.3
and 2.4 shall terminate in the event that a Public Offering has been
consummated.
Section 2.6. Registration; Restrictions on Sale Upon Public
Offering. NFC agrees that, in the event that the Company files a registration
statement under the Securities Act with respect to an underwritten public
offering of any shares of its capital stock, it will not seek to effect any
public sale (including a sale under Rule 144) of any of the shares of capital
stock of the Company or any distribution of such shares, other than as part of
such underwritten public offering, during the 20 days prior to and the 180 days
after the effective date of such registration statement.
Section 2.7 Qualifying Sale. The CD&R Fund agrees that it shall not
consummate the sale of any of its shares of Common Stock in a transaction that
would be deemed a Qualified Sale (as defined in the Registration and
Participation Agreement) unless and until those holders of Registrable
Securities (as defined in the Registration and Participation Agreement) who have
elected to participate in the contemplated Qualifying Sale are allowed to
participate in such Qualifying Sale (in accordance with Section 4(a) of the
Registration and Participation Agreement).
Section 2.8 Delivery of Certain Financial Information. As long as
the Company (x) has not registered any securities under the Exchange Act and (y)
is not subject to the reporting requirements of the Exchange Act, the Company
will provide NFC with copies of the financial information that the Company
provides to holders of NAVL's senior subordinated notes.
Section 3. Restrictions on U.K. Shares Realcause Limited shall not
Transfer the U.K. Shares without the prior written consent of the Buyer such
consent not not to be unreasonably withheld. The "Drag-Along" provisions of
Section 2.4 shall apply to the U.K. Shares mutatis mutandis in the case of a
transfer of the shares of Pickfords Limited.
Section 4. Definitions.
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Affiliate: with respect to any Person, any other Person that
directly or indirectly, through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person.
Applicable Percentage: the meaning specified in Section 2.4.
Beneficially Own: with respect to any securities shall mean having
"beneficial ownership" of such securities (as determined pursuant to Rule 13d-3
under the Exchange Act), including pursuant to any agreement, arrangement or
understanding, whether or not in writing.
Board: the meaning specified in Section 1(a).
CD&R Fund: Clayton, Dubilier & Rice Fund V Limited Partnership, a
Cayman Islands exempted limited partnership (together with any successor
investment vehicle managed by Clayton, Dubilier & Rice, Inc.).
Commission: the Securities and Exchange Commission or any other
Federal agency at the time administering the Securities Act or the Exchange Act,
whichever is the relevant statute for the particular purpose.
Common Stock: the meaning specified in the recitals to this
Agreement.
Company: the meaning specified in the introductory paragraph of this
Agreement.
Drag-Along Closing: the meaning specified in Section 2.4.
Drag-Along Notice: the meaning specified in Section 2.4.
Drag-Along Offer: the meaning specified in Section 2.4.
Drag-Along Price: the meaning specified in Section 2.4.
Exchange Act: the Securities Exchange Act of 1934, as amended, or
any successor Federal statute and the rules and regulations thereunder, which
shall be in effect at the time. Any reference to a particular section of the
Securities Exchange Act of 1934 shall include a reference to the corresponding
section, if any, of any such successor statute.
First Refusal Period: the meaning specified in Section 2.3.
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Independent Directors: the meaning specified in Section 1(a).
NFC: the meaning specified in the introductory paragraph of this
Agreement, provided that for all purposes of this Agreement the term "NFC" shall
also include any Affiliate of NFC in whose name any shares of Common Stock are
registered from time to time.
Offer Price: the meaning specified in Section 2.4.
Offer Terms: the meaning specified in Section 2.4.
Person: an individual, a partnership, a limited liability company,
an association, a joint venture, a corporation, a business, a trust, an
unincorporated organization or a government or any department, agency or
subdivision thereof.
Public Offering: any underwritten public offering of Common Stock
led by one or more underwriters at least one of which is of nationally
recognized standing pursuant to an effective registration statement under the
Securities Act.
Registration and Participation Agreement: the meaning specified in
the introductory paragraph of this Agreement.
Second Refusal Period: the meaning specified in Section 2.3.
Securities Act: the Securities Act of 1933, as amended, or any
successor Federal statute, and the rules and regulations thereunder, which shall
be in effect at the time. Any reference to a particular section of the
Securities Act of 1933 shall include a reference to the corresponding section,
if any, of any such successor statute.
Shares: the meaning specified in the recitals of this Agreement.
Subsidiary: as to any Person, any corporation at least a majority of
the shares of stock of which having general voting power under ordinary
circumstances to elect a majority of the Board of Directors of such corporation
(irrespective of whether or not at the time stock of any other class or classes
shall have or might have voting power by reason of the happening of any
contingency) is, at the time as of which the determination is being made, owned
by such Person, or one or more of its Subsidiaries or by such Person and one or
more of its Subsidiaries.
Subsidiary Board: the meaning specified in Section 1(c).
11
<PAGE>
Third Party Buyer: any Person who is not an Affiliate of the CD&R
Fund and who does not own shares of common stock in a company (other than the
Company) in which an investment fund managed by Clayton, Dubilier & Rice, Inc.
has made an investment.
Transfer: unless the context otherwise requires, any sale,
assignment, pledge or other disposition of any security, or of any interest
therein, which could constitute a "sale" as that term is defined in Section 2(3)
of the Securities Act.
Transfer Notice: the meaning specified in Section 2.2.
U.K. Shares: the meaning in the recitals to this Agreement.
Section 5. Notices. All notices, requests, demands, waivers and
other communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given if (a) delivered
personally, (b) mailed, certified or registered mail with postage prepaid, (c)
sent by next-day or overnight mail or delivery or (d) sent by telecopy or
telegram (with telephone confirmation), as follows:
if to NFC, to it at:
NFC plc
66 Chiltern Street
London W1N 3LT
England
Fax: (44 171) 224-2381
Tel: (44 171) 317-0088
Attention: Director of Legal Services
with copies to:
Kirkland & Ellis
Citicorp Centre
153 East 53rd Street
New York, New York 10022
Fax: 212-446-4900
Tel: 212-446-4940
Attention: Kirk A. Radke
12
<PAGE>
and
Ashurst Morris Crisp
Broadwalk House
5 Appold Street
London England EC2A 2HA
Fax: (44 171) 972-7990
Tel: (44 171) 972-7710
Attention: Geoffrey Green
if to the Company or NAVL, to it at:
NA Holding Corporation
c/o North American Van Lines, Inc.
5001 U.S. HWY 30 West
Fort Wayne, Indiana 46801
Fax: 219-429-3135
Tel: 219-429-2511
Attention: General Counsel
with a copy to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Fax: 212-909-6836
Tel: 212-909-6000
Attention: Paul S. Bird
if to the CD&R Fund, to it at:
Clayton, Dubilier & Rice Fund V
Limited Partnership
1403 Foulk Road, Suite 106
Wilmington, Delaware 19803
Attention: General Partner
13
<PAGE>
with a copy to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Fax: 212-909-6836
Tel: 212-909-6000
Attention: Paul S. Bird
Section 6. Amendment. This Agreement and any term hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought.
Section 7. Successors and Assigns. This Agreement shall be binding
upon the Company, the CD&R Fund and NFC and their respective successors and
assigns. No party hereto may assign this Agreement (other than to its
Affiliates) or its rights or duties hereunder without the prior written consent
of the other parties hereto.
Section 8. No Third Party Beneficiary. This Agreement is intended to
be solely for the benefit of the parties hereto and is not intended to confer
any benefits or create any rights in favor of, any person other than the parties
hereto.
Section 9. Entire Agreement. This Agreement, together with the
Acquisition Agreement, the Registration and Participation Agreement and the NFC
Subscription Agreement, constitutes the entire understanding and agreement among
the parties as to the matters covered herein and supersedes and replaces any
prior understanding, agreement or statement of intent, whether written or oral,
among the parties with respect to the subject matter hereof.
Section 10. Miscellaneous. The section headings of this Agreement
are for purposes of convenience only and shall not constitute a part hereof.
This Agreement may be executed in counterparts, each of which shall be deemed an
original and all of which taken together shall constitute one and the same
instrument.
14
<PAGE>
THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED
BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ITS PRINCIPLES OR
RULES OF CONFLICT OF LAWS TO THE EXTENT SUCH PRINCIPLES OR RULES WOULD REQUIRE
OR PERMIT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION).
Very truly yours,
NA HOLDING CORPORATION
By /s/R. Barry Uber
--------------------------------------
Name: R. Barry Uber
Title: President and Chief Executive
Officer
NORTH AMERICAN VAN LINES, INC.
By /s/R. Barry Uber
--------------------------------------
Name: R. Barry Uber
Title: President and Chief Executive
Officer
15
<PAGE>
CLAYTON, DUBILIER & RICE
FUND V LIMITED PARTNERSHIP
By CD&R Associates V
Limited Partnership
the General Partnership
By CD&R Investment Associates II, Inc.
By /s/Donald J. Gogel
--------------------------------------
Name: Donald J. Gogel
Title: President and Chief Executive
Officer
Agreed to and acknowledged
as of the date first written above.
NFC PLC
By /s/Jeremy Letchford
----------------------------
Name: Jeremy Letchford
Title: Secretary
16
<PAGE>
Agreed to and acknowledged
as of the date first written above.
NFC INTERNATIONAL HOLDINGS
(NETHERLANDS II) BV
By /s/Ronan J. Dunne
----------------------------
Name: Ronan J. Dunne
Title: Authorized Signatory
17
<PAGE>
Exhibit 10.11
Conformed Copy
STOCK SUBSCRIPTION AGREEMENT
STOCK SUBSCRIPTION AGREEMENT, dated as of November 19, 1999 between
NA Holding Corporation, a Delaware corporation (the "Company"), and Clayton,
Dubilier & Rice Fund V Limited Partnership, a Cayman Islands exempted limited
partnership (together with any successor investment vehicle managed by Clayton,
Dubilier & Rice, Inc., the "Purchaser").
W I T N E S S E T H:
WHEREAS, the Purchaser currently owns 615,050 shares of the common
stock, par value $0.01 per share, of the Company (the "Common Stock");
WHEREAS, the Purchaser and the Company have entered into a
registration and participation agreement, dated as of March 30, 1998, as amended
as of the date hereof and as may be further amended from time to time (the
"Registration and Participation Agreement"), and a letter agreement with NFC plc
(the "Letter Agreement"), a company organized under the laws of England and
Wales ("NFC"), dated as of the date hereof, which together set forth certain
agreements among the Company, the Purchaser and NFC with respect to the shares
of Common Stock owned from time to time by the Purchaser;
WHEREAS, the Purchaser desires to subscribe for and purchase, and
the Company desires to sell to the Purchaser, up to 281,690 shares of Common
Stock, at a purchase price of $142.00 per share, such number of shares to be
reduced by the number of shares of Common Stock purchased by NFC on or prior to
December 31, 1999;
NOW, THEREFORE, to implement the foregoing and in consideration of
the mutual agreements contained herein, the parties hereto hereby agree as
follows:
1. Purchase and Sale of Common Stock.
(a) Purchase of Common Stock. Subject to all of the terms and
conditions of this Agreement, the Purchaser hereby subscribes for and shall
purchase, and the Company shall sell to the Purchaser, a number of shares of
Common Stock (the "Shares") equal to 281,690 less such number of shares of
Common Stock as NFC purchases on or before December 31, 1999, at a purchase
price of $142.00 per Share, at the Closing provided for in Section 2(a) hereof.
<PAGE>
(b) Consideration. Subject to all of the terms and conditions of
this Agreement, the Purchaser shall deliver to the Company at the Closing
referred to in Section 2(a) hereof immediately available funds in the amount of
the number of Shares multiplied by $142.00 by wire transfer to an account
designated by the Company.
2. Closing.
(a) Time and Place. The parties currently intend that the closing of
the transaction contemplated by this Agreement (the "Closing") shall be held at
the offices of Debevoise & Plimpton, 875 Third Avenue, New York, New York at
10:00 a.m. (New York time) on December 1, 1999, except as otherwise mutually
agreed by the Company and the Purchaser, provided that if the Closing does not
occur on December 1, 1999, the Closing shall take place no later than December
31, 1999.
(b) Delivery by the Company. At the Closing the Company shall
deliver to the Purchaser a stock certificate registered in such Purchaser's name
and representing the Shares, which certificate shall bear the legend set forth
in Section 3(b).
(c) Delivery by the Purchaser. At the Closing the Purchaser shall
deliver to the Company the consideration referred to in Section 1(b) hereof.
3. Purchaser's Representations, Warranties and Covenants.
(a) Investment Intention. The Purchaser represents and warrants that
it is acquiring the Shares solely for its own account for investment and not
with a view to or for sale in connection with any distribution thereof in any
transaction or series of transactions that would be in violation of the
securities laws of the United States or any state thereof. The Purchaser agrees
that it will not, directly or indirectly, offer, transfer, sell, pledge,
hypothecate or otherwise dispose of any of the Shares (or solicit any offers to
buy, purchase or otherwise acquire or take a pledge of any Shares), except in
compliance with the Letter Agreement and with the Securities Act of 1933, as
amended (the "Securities Act"), and the rules and regulations of the Securities
and Exchange Commission (the "Commission") thereunder, and in compliance with
applicable state securities or "blue sky" laws.
(b) Legend. The Purchaser acknowledges that the certificate or
certificates representing the Shares shall bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TRANSFER RESTRICTIONS (INCLUDING A RIGHT OF FIRST
2
<PAGE>
REFUSAL AND A HOLDBACK AGREEMENT) SET FORTH IN A LETTER AGREEMENT,
DATED AS OF NOVEMBER 19, 1999, AS SUCH AGREEMENT MAY BE AMENDED FROM
TIME TO TIME, AMONG NA HOLDING CORPORATION, NORTH AMERICAN VAN
LINES, INC., NFC PLC AND CLAYTON, DUBILIER & RICE FUND V LIMITED
PARTNERSHIP AND NEITHER THIS CERTIFICATE NOR THE SHARES REPRESENTED
BY IT ARE ASSIGNABLE OR OTHERWISE TRANSFERABLE EXCEPT IN ACCORDANCE
WITH THE PROVISIONS OF SUCH LETTER AGREEMENT, A COPY OF WHICH IS ON
FILE WITH THE SECRETARY OF NA HOLDING CORPORATION. THE SHARES
REPRESENTED BY THIS CERTIFICATE ARE ENTITLED TO CERTAIN OF THE
BENEFITS OF AND ARE BOUND BY THE OBLIGATIONS SET FORTH IN A
REGISTRATION AND PARTICIPATION AGREEMENT, DATED AS OF MARCH 30,
1998, AS AMENDED AS OF NOVEMBER 19, 1999, AS SUCH AGREEMENT MAY BE
AMENDED FROM TIME TO TIME, AMONG NA HOLDING CORPORATION AND CERTAIN
STOCKHOLDERS OF NA HOLDING CORPORATION, A COPY OF WHICH IS ON FILE
WITH THE SECRETARY OF NA HOLDING CORPORATION.
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE OR
FOREIGN SECURITIES LAWS AND MAY NOT BE TRANSFERRED, SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) (A) SUCH
DISPOSITION IS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, (B) THE HOLDER HEREOF SHALL
HAVE DELIVERED TO NA HOLDING CORPORATION AN OPINION OF COUNSEL,
WHICH OPINION AND COUNSEL SHALL BE REASONABLY SATISFACTORY TO NA
HOLDING CORPORATION, TO THE EFFECT THAT SUCH DISPOSITION IS EXEMPT
FROM THE PROVISIONS OF SECTION 5 OF SUCH ACT OR (C) A NO-ACTION
LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION, REASONABLY
SATISFACTORY TO COUNSEL FOR NA HOLDING CORPORATION, SHALL HAVE BEEN
OBTAINED WITH RESPECT TO SUCH DISPOSITION AND (ii) SUCH DISPOSITION
IS PURSUANT TO REGISTRATION UNDER ANY APPLICABLE STATE SECURITIES
LAWS OR AN EXEMPTION THEREFROM."
3
<PAGE>
(c) Registration and Participation Agreement. The Purchaser
acknowledges and agrees that it shall be entitled to the rights and subject to
the obligations created under the Registration and Participation Agreement. The
Purchaser agrees that, in the event that the Company files a registration
statement under the Securities Act with respect to an underwritten public
offering of any shares of its capital stock, the Purchaser will not effect any
public sale or distribution of any shares of the Common Stock (other than as
part of such underwritten public offering) during the 20 days prior to and the
180 days after the effective date of such registration statement.
4. Representations and Warranties of the Company. The Company
represents and warrants to the Purchaser that (a) the Company has been duly
incorporated and is an existing corporation in good standing under the laws of
the State of Delaware, (b) this Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding obligation
of the Company enforceable against the Company in accordance with its terms, and
(c) the Shares, when issued and delivered in accordance with the terms hereof,
will be duly authorized, validly issued, fully paid and nonassessable, and free
and clear of any liens or encumbrances other than those created pursuant to this
Agreement or otherwise in connection with the transactions contemplated hereby.
5. Miscellaneous.
(a) Notices. All notices and other communications required or
permitted to be given under this Agreement shall be in writing and shall be
deemed to have been given if delivered personally or sent by certified or
express mail, return receipt requested, postage prepaid, or by any recognized
international equivalent of such mail delivery, to the Company or the Purchaser,
as the case may be, at the following addresses or to such other address as the
Company or the Purchaser, as the case may be, shall specify by notice to the
others:
(i) if to the Company, to:
NA Holding Corporation
c/o North American Van Lines, Inc.
5001 U.S. Hwy 30 West
P.O. Box 988
Fort Wayne, Indiana 46801-0988
Attention: General Counsel
4
<PAGE>
(ii) if to the Purchaser, to:
Clayton, Dubilier & Rice
Fund V Limited Partnership
1402 Foulk Road
Suite 106
Wilmington, Delaware 19803
Attention: General Partner
All such notices and communications shall be deemed to have been received on the
date of delivery or on the third business day after the mailing thereof. Copies
of any notice or other communication given under this Agreement shall also be
given to:
Clayton, Dubilier & Rice, Inc.
375 Park Avenue
New York, NY 10152
Attention: Kevin J. Conway
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Attention: Paul S. Bird, Esq.
(b) Binding Effect; Benefits. This Agreement shall be binding upon
and inure to the benefit of the parties to this Agreement and their respective
successors and assigns. Nothing in this Agreement, express or implied, is
intended or shall be construed to give any person other than the parties to this
Agreement or their respective successors or assigns any legal or equitable
right, remedy or claim under or in respect of any agreement or any provision
contained herein.
(c) Waiver; Amendment.
(i) Waiver. Either party hereto may by written notice to the other
(A) extend the time for the performance of any of the obligations or other
actions of the other under this Agreement, (B) waive compliance with any
of the conditions or covenants of the other contained in this Agreement
and (C) waive or modify performance of any of the obligations of the other
under this Agreement. Except as provided in the preceding sentence, no
action taken pursuant to this Agreement, including, without limitation,
any investigation by or on behalf of either party, shall be deemed to
constitute a waiver by the party taking such action of compliance with any
representations,
5
<PAGE>
warranties, covenants or agreements contained herein. The waiver by either
party hereto of a breach of any provision of this Agreement shall not
operate or be construed as a waiver of any preceding or succeeding breach
and no failure by either party to exercise any right or privilege
hereunder shall be deemed a waiver of such party's rights or privileges
hereunder or shall be deemed a waiver of such party's rights to exercise
the same at any subsequent time or times hereunder.
(ii) Amendment. This Agreement may be amended, modified or
supplemented only by a written instrument executed by the Purchaser and
the Company.
(d) Assignability. Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by the Company or the Purchaser without the prior written consent of
the other party, provided that the Company may assign this Agreement pursuant to
the Security Agreement, dated as of November 19, 1999 (the "Security Agreement")
entered in favor of The Chase Manhattan Bank and Bank of America, N.A. as
Lenders (the "Lenders") as security for obligations to such Lenders pursuant to
the Loan Agreement, also dated as of November 19, 1999, among the Company and
the Lenders. The Purchaser hereby acknowledges and consents to the Company's
granting a lien on and security in all of the Company's right, title and
interest hereunder pursuant to the Security Agreement, irrevocably consents to
the assignment of this Agreement by the Company and any and all subsequent
assignments by the Lenders to any third party, and acknowledges and consents to
all the terms thereof (including, without limitation, Section 5.1 thereof).
(e) Applicable Law. This Agreement shall be governed by and
construed in accordance with the law of the State of New York, regardless of the
law that might be applied under principles of conflict of laws.
(f) Section and Other Headings, etc. The section and other headings
contained in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
(g) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.
(h) Entire Agreement. This Agreement, together with the Registration
and Participation Agreement and the Letter Agreement, constitutes the entire
understanding and agreement among the parties as to the matters covered herein
and supersedes and replaces any prior understanding, agreement or statement of
intent, whether written or oral, among the parties with respect to the subject
matter hereof.
6
<PAGE>
IN WITNESS WHEREOF, the Company and the Purchaser have duly executed
this Agreement by their authorized representatives as of the date first above
written.
NA HOLDING CORPORATION
By: /s/Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Secretary
CLAYTON, DUBILIER & RICE
FUND V LIMITED PARTNERSHIP
By: CD&R Associates V Limited Partnership,
its general partner
By: CD&R Investment Associates II, Inc.,
its managing general partner
By: /s/William A. Barbe
----------------------------------------
Name: William A. Barbe
Title: Vice President, Secretary and
Treasurer
<PAGE>
Exhibit 10.12
Conformed Copy
STOCK SUBSCRIPTION AGREEMENT
STOCK SUBSCRIPTION AGREEMENT, dated as of November 19, 1999, between
NA Holding Corporation, a Delaware corporation (the "Company"), and NFC plc, a
company organized under the laws of England and Wales (the "Purchaser").
W I T N E S S E T H:
WHEREAS, pursuant to an Acquisition Agreement, dated as of September
14, 1999, as amended from time to time (the "Acquisition Agreement"), between
the Company and the Purchaser, the Purchaser will acquire 174,961 shares of the
common stock, par value $0.01 per share, of the Company (the "Common Stock");
WHEREAS, the Purchaser desires to subscribe for and purchase, and
the Company desires to sell to the Purchaser, 56,338 shares of Common Stock, at
a purchase price of $142.00 per share;
WHEREAS, the Purchaser and the Company have entered into a letter
agreement, dated as of the date hereof (the "Letter Agreement"), with the
Clayton, Dubilier & Rice Fund V Limited Partnership (the "CD&R Fund"), which
sets forth certain agreements among the Company, the Purchaser and the CD&R Fund
with respect to the shares of Common Stock owned from time to time by NFC or its
Affiliates (as defined in the Letter Agreement);
NOW, THEREFORE, to implement the foregoing and in consideration of
the mutual agreements contained herein, the parties hereto hereby agree as
follows:
1. Purchase and Sale of Common Stock.
(a) Purchase of Common Stock. Subject to all of the terms and
conditions of this Agreement, the Purchaser hereby subscribes for and shall
purchase, and the Company shall sell to the Purchaser, 56,338 shares of Common
Stock (the "Shares"), at a purchase price of $142.00 per Share, at the Closing
provided for in Section 2(a) hereof.
(b) Consideration. Subject to all of the terms and conditions of
this Agreement, the Purchaser shall deliver to the Company at the Closing
referred to in Sec-
<PAGE>
Conformed Copy
tion 2(a) hereof immediately available funds in the amount of $7,999,996.00 by
wire transfer to an account designated by the Company.
2. Closing.
(a) Time and Place. The parties currently intend that the closing of
the transaction contemplated by this Agreement (the "Closing") shall be held at
the offices of Debevoise & Plimpton, 875 Third Avenue, New York, New York at
10:00 a.m. (New York time) on December 1, 1999, except as otherwise mutually
agreed by the Company and the Purchaser, provided that if the Closing does not
occur on December 1, 1999, the Closing shall take place no later than December
31, 1999.
(b) Delivery by the Company. At the Closing the Company shall
deliver to the Purchaser a stock certificate registered in such Purchaser's name
and representing the Shares, which certificate shall bear the legend set forth
in Section 3(b).
(c) Delivery by the Purchaser. At the Closing the Purchaser shall
deliver to the Company the consideration referred to in Section 1(b) hereof.
3. Purchaser's Representations, Warranties and Covenants.
(a) Investment Intention. The Purchaser represents and warrants that
it is acquiring the Shares solely for its own account for investment and not
with a view to or for sale in connection with any distribution thereof in any
transaction or series of transactions that would be in violation of the
securities laws of the United States or any state thereof. The Purchaser agrees
that it will not, directly or indirectly, offer, transfer, sell, pledge,
hypothecate or otherwise dispose of any of the Shares (or solicit any offers to
buy, purchase or otherwise acquire or take a pledge of any Shares), except in
compliance with the Letter Agreement and with the Securities Act of 1933, as
amended (the "Securities Act"), and the rules and regulations of the Securities
and Exchange Commission (the "Commission") thereunder, and in compliance with
applicable state securities or "blue sky" laws.
(b) Legend. The Purchaser acknowledges that the certificate or
certificates representing the Shares shall bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TRANSFER RESTRICTIONS (INCLUDING A RIGHT OF FIRST REFUSAL AND A
HOLDBACK AGREEMENT) SET FORTH IN A LETTER AGREEMENT, DATED AS OF
2
<PAGE>
Conformed Copy
NOVEMBER 19, 1999, AS SUCH AGREEMENT MAY BE AMENDED FROM TIME TO
TIME, AMONG NA HOLDING CORPORATION, NORTH AMERICAN VAN LINES, INC.,
NFC PLC AND CLAYTON, DUBILIER & RICE FUND V LIMITED PARTNERSHIP AND
NEITHER THIS CERTIFICATE NOR THE SHARES REPRESENTED BY IT ARE
ASSIGNABLE OR OTHERWISE TRANSFERABLE EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF SUCH LETTER AGREEMENT, A COPY OF WHICH IS ON FILE WITH
THE SECRETARY OF NA HOLDING CORPORATION. THE SHARES REPRESENTED BY
THIS CERTIFICATE ARE ENTITLED TO CERTAIN OF THE BENEFITS OF AND ARE
BOUND BY THE OBLIGATIONS SET FORTH IN A REGISTRATION AND
PARTICIPATION AGREEMENT, DATED AS OF MARCH 30, 1998, AS AMENDED AS
OF NOVEMBER 19, 1999, AS SUCH AGREEMENT MAY BE AMENDED FROM TIME TO
TIME, AMONG NA HOLDING CORPORATION AND CERTAIN STOCKHOLDERS OF NA
HOLDING CORPORATION, A COPY OF WHICH IS ON FILE WITH THE SECRETARY
OF NA HOLDING CORPORATION.
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE OR
FOREIGN SECURITIES LAWS AND MAY NOT BE TRANSFERRED, SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) (A) SUCH
DISPOSITION IS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, (B) THE HOLDER HEREOF SHALL
HAVE DELIVERED TO NA HOLDING CORPORATION AN OPINION OF COUNSEL,
WHICH OPINION AND COUNSEL SHALL BE REASONABLY SATISFACTORY TO NA
HOLDING CORPORATION, TO THE EFFECT THAT SUCH DISPOSITION IS EXEMPT
FROM THE PROVISIONS OF SECTION 5 OF SUCH ACT OR (C) A NO-ACTION
LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION, REASONABLY
SATISFACTORY TO COUNSEL FOR NA HOLDING CORPORATION, SHALL HAVE BEEN
OBTAINED WITH RESPECT TO SUCH DISPOSITION AND (ii) SUCH DISPOSITION
IS PURSUANT TO REGISTRATION UNDER ANY APPLICABLE STATE SECURITIES
LAWS OR AN EXEMPTION THEREFROM."
3
<PAGE>
Conformed Copy
(c) Registration and Participation Agreement. The Purchaser
acknowledges and agrees that it shall be entitled to the rights and subject to
the obligations created under the Registration and Participation Agreement,
dated as of March 30 1998 (the "Registration and Participation Agreement"),
between the Company and the CD&R Fund, as amended as of November 19, 1999, and
as may be amended from time to time. The Purchaser agrees that, in the event
that the Company files a registration statement under the Securities Act with
respect to an underwritten public offering of any shares of its capital stock,
the Purchaser will not effect any public sale or distribution of any shares of
the Common Stock (other than as part of such underwritten public offering)
during the 20 days prior to and the 180 days after the effective date of such
registration statement.
4. Representations and Warranties of the Company. The Company
represents and warrants to the Purchaser that (a) the Company has been duly
incorporated and is an existing corporation in good standing under the laws of
the State of Delaware, (b) this Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding obligation
of the Company enforceable against the Company in accordance with its terms, and
(c) the Shares, when issued and delivered in accordance with the terms hereof,
will be duly authorized, validly issued, fully paid and nonassessable, and free
and clear of any liens or encumbrances other than those created pursuant to this
Agreement or otherwise in connection with the transactions contemplated hereby.
5. Miscellaneous.
(a) Notices. All notices and other communications required or
permitted to be given under this Agreement shall be in writing and shall be
deemed to have been given if delivered personally or sent by certified or
express mail, return receipt requested, postage prepaid, or by any recognized
international equivalent of such mail delivery, to the Company or the Purchaser,
as the case may be, at the following addresses or to such other address as the
Company or the Purchaser, as the case may be, shall specify by notice to the
others:
4
<PAGE>
Conformed Copy
(i) if to the Company, to:
NA Holding Corporation
c/o North American Van Lines, Inc.
5001 U.S. Hwy 30 West
P.O. Box 988
Fort Wayne, Indiana 46801-0988
Attention: General Counsel
(ii) if to the Purchaser, to:
NFC, plc
66 Chiltern Street
London W1N 3LT
England
Attention: Director of Legal Services
All such notices and communications shall be deemed to have been received on the
date of delivery or on the third business day after the mailing thereof. Copies
of any notice or other communication given under this Agreement shall also be
given to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Attention: Paul S. Bird, Esq.
(b) Binding Effect; Benefits. This Agreement shall be binding upon
and inure to the benefit of the parties to this Agreement and their respective
successors and assigns. Nothing in this Agreement, express or implied, is
intended or shall be construed to give any person other than the parties to this
Agreement or their respective successors or assigns any legal or equitable
right, remedy or claim under or in respect of any agreement or any provision
contained herein.
(c) Waiver; Amendment.
(i) Waiver. Either party hereto may by written notice to the other
(A) extend the time for the performance of any of the obligations or other
actions of the other under this Agreement, (B) waive compliance with any
of the conditions or covenants of the other contained in this Agreement
and (C) waive or modify performance of any of the obligations of the other
under this Agreement.
5
<PAGE>
Conformed Copy
Except as provided in the preceding sentence, no action taken pursuant to
this Agreement, including, without limitation, any investigation by or on
behalf of either party, shall be deemed to constitute a waiver by the
party taking such action of compliance with any representations,
warranties, covenants or agreements contained herein. The waiver by either
party hereto of a breach of any provision of this Agreement shall not
operate or be construed as a waiver of any preceding or succeeding breach
and no failure by either party to exercise any right or privilege
hereunder shall be deemed a waiver of such party's rights or privileges
hereunder or shall be deemed a waiver of such party's rights to exercise
the same at any subsequent time or times hereunder.
(ii) Amendment. This Agreement may be amended, modified or
supplemented only by a written instrument executed by the Purchaser and
the Company.
(d) Assignability. Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by the Company or the Purchaser without the prior written consent of
the other party.
(e) Applicable Law. This Agreement shall be governed by and
construed in accordance with the law of the State of New York, regardless of the
law that might be applied under principles of conflict of laws.
(f) Section and Other Headings, etc. The section and other headings
contained in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
(g) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.
(h) Entire Agreement. This Agreement, together with the Registration
and Participation Agreement and the Letter Agreement, constitutes the entire
understanding and agreement among the parties as to the matters covered herein
and supersedes and replaces any prior understanding, agreement or statement of
intent, whether written or oral, among the parties with respect to the subject
matter hereof.
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Conformed Copy
IN WITNESS WHEREOF, the Company and the Purchaser have duly executed
this Agreement by their authorized representatives as of the date first above
written.
NA HOLDING CORPORATION
By: /s/Ralph A. Ford
----------------------------------------
Name: Ralph A. Ford
Title: Secretary
NFC PLC
By: /s/Jeremy Letchford
----------------------------------------
Name: Jeremy Letchford
Title: Secretary
<PAGE>
Exhibit 10.13
FORM OF MANAGEMENT STOCK SUBSCRIPTION AGREEMENT
MANAGEMENT STOCK SUBSCRIPTION AGREEMENT, dated as of _________ (the
"Agreement"), between Allied Worldwide, Inc. (formerly NA Holding Corporation),
a Delaware corporation ("Worldwide"), and the purchaser whose name appears on
the signature page hereof (the "Purchaser").
WITNESSETH:
WHEREAS, to motivate key employees at Worldwide and the subsidiaries
by providing them an ownership interest in Worldwide, the Board of Directors of
Worldwide (the "Board") has adopted the Allied Worldwide, Inc. Stock Incentive
Plan (formerly the NA Holding Corporation Stock Incentive Plan), as the same may
be amended from time to time (the "Stock Incentive Plan");
WHEREAS, Worldwide intends to issue up to an aggregate of ________
shares Common Stock, par value $___ per share, of Worldwide (the "Common
Stock"), to the Purchaser and to certain other purchasers who are executives,
senior officers or other key employees of the Company or one of its Subsidiaries
(as defined herein) pursuant to the Stock Incentive Plan, this Agreement and
other substantially identical management stock subscription agreements to be
entered into with such other purchasers and intends to grant options to purchase
up to an aggregate of ________ additional shares of Common Stock to the
Purchaser and to such other executive officers and key employees;
WHEREAS, the terms of the offering of the shares, and the grant of
options in respect, of the Common Stock to the Purchaser and the other
purchasers (the "Offering") are set forth in a Confidential Offering Memorandum,
dated _________ (as supplemented from time to time, the "Offering Memorandum") a
copy of which has been furnished to the Purchaser;
WHEREAS, the Purchaser desires to subscribe for and purchase from
Worldwide pursuant to the Stock Incentive Plan the aggregate number of shares of
Common Stock set forth on the signature page hereof (each a "Share" and,
collectively, the "Shares"), at a purchase price of $____ per share; and
WHEREAS, the Company desires to sell the Shares to the Purchaser on
the terms and subject to the conditions set forth herein and in the Stock
Incentive Plan and subject to the Registration Statement becoming effective.
<PAGE>
NOW, THEREFORE, to implement the foregoing and in consideration of
the mutual agreements contained herein, the parties hereto hereby agree as
follows:
1. Purchase and Sale of Common Stock.
(a) Purchase of Common Stock. Subject to all of the terms and
conditions of this Agreement, the Purchaser hereby subscribes for and shall
purchase, and Worldwide shall sell to the Purchaser, the Shares at a purchase
price of $____ per Share, at the Closing provided for in Section 2(a) hereof.
Notwithstanding anything in this Agreement to the contrary, Worldwide shall have
no obligation to sell any Common Stock to (i) any person who is not an employee
of Worldwide or a Subsidiary thereof (as defined below) at the time that such
Common Stock is to be sold or (ii) any person who is a resident of a
jurisdiction in which the sale of Common Stock to him would constitute a
violation of the securities, "blue sky" or other laws of such jurisdiction.
(b) Consideration. Subject to all of the terms and conditions of
this Agreement, the Purchaser shall deliver to Worldwide at the Closing referred
to in Section 2(a) hereof immediately available funds in an amount equal to the
aggregate purchase price for the Shares set forth on the signature page hereof.
2. Closing.
(a) Time and Place. Except as otherwise agreed by Worldwide and the
Purchaser, the closing (the "Closing") of the transaction contemplated by this
Agreement shall be held at the offices of Debevoise & Plimpton, 875 Third
Avenue, New York, New York at 10:00 am. (New York time) on December 22, 1999.
(b) Delivery by Worldwide. At the Closing, Worldwide shall deliver
to the Purchaser a stock certificate registered in the Purchaser's name and
representing the Shares, which certificate shall bear the legends set forth in
Section 3(b).
(c) Delivery by the Purchaser. At the Closing, the Purchaser shall
deliver to Worldwide the consideration referred to in Section 1(b) hereof.
3. Purchaser's Representations. Warranties and Covenants.
(a) Investment Intention. The Purchaser represents and warrants that
he is acquiring the Shares solely for his own account for investment and not
with a view to or for sale in connection with any distribution thereof. The
Purchaser agrees that he will not, directly or indirectly, offer, transfer,
sell, pledge, hypothecate or otherwise dispose of any of the Shares (or solicit
any offers to buy, purchase or otherwise acquire or take a pledge
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of any Shares), except in compliance with the Securities Act of 1933, as amended
(the "Securities Act"), and the rules and regulations of the Securities and
Exchange Commission (the "Commission") thereunder, and in compliance with
applicable state and foreign securities or "blue sky" laws. The Purchaser
further understands, acknowledges and agrees that none of the Shares may be
transferred, sold, pledged, hypothecated or otherwise disposed of (i) unless the
provisions of Sections 4 through 8 hereof, inclusive, shall have been complied
with or have expired, (ii) unless (A) such disposition is pursuant to an
effective registration statement under the Securities Act, (B) the Purchaser
shall have delivered to Worldwide an opinion of counsel, which opinion and
counsel shall be reasonably satisfactory to Worldwide, to the effect that such
disposition is exempt from the provisions of Section 5 of the Securities Act or
(C) a no-action letter from the Commission, reasonably satisfactory to
Worldwide, shall have been obtained with respect to such disposition and (iii)
unless such disposition is pursuant to registration under any applicable state
securities laws or an exemption therefrom.
(b) Legends. The Purchaser acknowledges that the certificate or
certificates representing the Shares shall bear an appropriate legend, which
will include, without limitation, the following language:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TRANSFER RESTRICTIONS, HOLDBACK AND OTHER PROVISIONS OF A MANAGEMENT
STOCK SUBSCRIPTION AGREEMENT, DATED AS OF __________, AND NEITHER
THIS CERTIFICATE NOR THE SHARES REPRESENTED BY IT ARE ASSIGNABLE OR
OTHERWISE TRANSFERABLE EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
SUCH MANAGEMENT STOCK SUBSCRIPTION AGREEMENT, A COPY OF WHICH IS ON
FILE WITH THE SECRETARY OF WORLDWIDE. THE SHARES REPRESENTED BY THIS
CERTIFICATE ARE ENTITLED TO CERTAIN OF THE BENEFITS OF AND ARE BOUND
BY THE OBLIGATIONS SET FORTH IN A REGISTRATION AND PARTICIPATION
AGREEMENT, DATED AS OF MARCH 30, 1998, AS AMENDED, AND ANY
AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS THERETO, AMONG WORLDWIDE
AND CERTAIN STOCKHOLDERS OF WORLDWIDE, A COPY OF THE CURRENT FORM OF
WHICH IS ON FILE WITH THE SECRETARY OF WORLDWIDE."
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE OR
FOREIGN SECURITIES
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LAWS AND MAY NOT BE TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS (i) (A) SUCH DISPOSITION IS PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933, AS AMENDED, (B) THE HOLDER HEREOF SHALL HAVE DELIVERED TO
WORLDWIDE AN OPINION OF COUNSEL, WHICH OPINION AND COUNSEL SHALL BE
REASONABLY SATISFACTORY TO WORLDWIDE, TO THE EFFECT THAT SUCH
DISPOSITION IS EXEMPT FROM THE PROVISIONS OF SECTION 5 OF SUCH ACT
OR (C) A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE
COMMISSION, REASONABLY SATISFACTORY TO COUNSEL FOR WORLDWIDE, SHALL
HAVE BEEN OBTAINED WITH RESPECT TO SUCH DISPOSITION AND (ii) SUCH
DISPOSITION IS PURSUANT TO REGISTRATION UNDER ANY APPLICABLE STATE
SECURITIES LAWS OR AN EXEMPTION THEREFROM."
(c) Securities Law Matters. The Purchaser acknowledges receipt of
advice from Worldwide that (i) the Shares have not been registered under the
Securities Act or any state or foreign securities or "blue sky" laws, (ii) it is
not anticipated that there will be any public market for the Shares, (iii) the
Shares must be held indefinitely and the Purchaser must continue to bear the
economic risk of the investment in the Shares unless the Shares are subsequently
registered under the Securities Act and such state or foreign laws or an
exemption from registration is available, (iv) Rule 144 promulgated under the
Securities Act ("Rule 144") is not presently available with respect to sales of
securities of Worldwide and Worldwide has made no covenant to make Rule 144
available, (v) when and if the Shares may be disposed of without registration in
reliance upon Rule 144, such disposition can generally be made only in limited
amounts in accordance with the terms and conditions of such Rule, (vi) Worldwide
does not plan to file reports with the Commission or make information concerning
Worldwide publicly available, unless required to do so by law or the terms of
its Financing Agreements (as hereinafter defined), (vii) if the exemption
afforded by Rule 144 is not available, sales of the Shares may be difficult to
effect because of the absence of public information concerning Worldwide, (viii)
a restrictive legend in the form heretofore set forth shall be placed on the
certificates representing the Shares and (ix) a notation shall be made in the
appropriate records of Worldwide indicating that the Shares are subject to
restrictions on transfer set forth in this Agreement and, if Worldwide should in
the future engage the services of a stock transfer agent, appropriate
stop-transfer restrictions will be issued to such transfer agent with respect to
the Shares.
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<PAGE>
(d) Compliance with Rule 144. If any of the Shares are to be
disposed of in accordance with Rule 144, the Purchaser shall transmit to
Worldwide an executed copy of Form 144 (if required by Rule 144) no later than
the time such form is required to be transmitted to the Commission for filing
and such other documentation as Worldwide may reasonably require to assure
compliance with Rule 144 in connection with such disposition.
(e) Ability to Bear Risk. The Purchaser represents and warrants that
(i) the financial situation of the Purchaser is such that he or she can afford
to bear the economic risk of holding the Shares for an indefinite period and
(ii) he or she can afford to suffer the complete loss of his or her investment
in the Shares.
(f) Access to Information, Etc. The Purchaser represents and
warrants that (i) the Purchaser has carefully reviewed the Offering Memorandum,
each of the attachments to the Offering Memorandum, each document incorporated
by reference into the Offering Memorandum, and the other materials furnished to
the Purchaser in connection with the transactions contemplated hereby, and (ii)
the Purchaser is, and will be at the Closing, an officer or employee of the
Company or a subsidiary thereof.
(g) Registration; Restrictions on Sale upon Public Offering. The
Purchaser shall be entitled to the rights and subject to the obligations created
under the Registration and Participation Agreement, dated as of March 30, 1998,
as amended, as the same may be amended from time to time, among Worldwide and
certain stockholders of Worldwide, to the extent provided therein. The Purchaser
agrees that, in the event that Worldwide files a registration statement under
the Securities Act with respect to an underwritten public offering of any shares
of its capital stock, the Purchaser will not effect any public sale (including a
sale under Rule 144) or distribution of any shares of the Common Stock (other
than as part of such underwritten public offering) during the 20 days prior to
and the 180 days after the effective date of such registration statement.
(h) Section 83(b) Election. The Purchaser agrees that, within 20
days after the Closing, he or she shall give notice to Worldwide as to whether
or not he has made or will make an election pursuant to Section 83(b) of the
Internal Revenue Code of 1986, as amended, with respect to the Shares purchased
at such Closing, and acknowledges that he or she will be solely responsible for
any and all tax liabilities payable by him or her in connection with his
purchase and receipt of the Shares or attributable to his or her making or
failing to make such an election.
4. Restrictions on Disposition of Shares. Neither the Purchaser nor
any of his or her heirs or representatives shall sell, assign, transfer, pledge
or otherwise directly or indirectly dispose of or encumber any of the Shares to
or with any other person, firm or
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<PAGE>
corporation (including, without limitation, transfers to any other holder of
Worldwide's capital stock, dispositions by gift, by will, by a corporation as a
distribution in liquidation and by operation of law other than a transfer of
Shares by operation of law to the estate of the Purchaser upon the death of the
Purchaser, provided that such estate shall be bound by all provisions of this
Agreement) except as provided in Sections 5 through 8 hereof, inclusive. The
restrictions contained in this Section 4 shall terminate in the event that an
underwritten public offering of the Common Stock led by one or more underwriters
at least one of which is of nationally recognized standing (a "Public Offering")
has been consummated and shall not apply to a sale as part of a Public Offering
or at any time thereafter.
5. Options of Worldwide and the CD&R Fund Upon Proposed Disposition.
(a) Rights of First Refusal. If the Purchaser desires to accept an
offer (which must be in writing and for cash, be irrevocable by its terms for at
least 60 days and be a bona fide offer as determined in good faith by the Board
or the Executive Committee thereof) from any prospective purchaser to purchase
all or any part of the Shares at any time owned by him, he shall give notice in
writing to Worldwide and Clayton, Dubilier & Rice Fund V Limited Partnership
(the "CD&R Fund") (i) designating the number of Shares proposed to be sold, (ii)
naming the prospective purchaser of such Shares and (iii) specifying the price
(the "Offer Price") at and terms (the "Offer Terms") upon which he desires to
sell the same. During the 30-day period following receipt of such notice by
Worldwide and the CD&R Fund (the "First Refusal Period"), Worldwide shall have
the right to purchase from the Purchaser all (but not less than all) of the
Shares specified in such notice, at the Offer Price and on the Offer Terms.
Worldwide hereby undertakes to use reasonable efforts to act as promptly as
practicable following receipt of such notice to determine whether it shall elect
to exercise such right. If Worldwide fails to exercise such right within the
First Refusal Period, the CD&R Fund shall have the right to purchase all (but
not less than all) of the Shares specified in such notice, at the Offer Price
and on the Offer Terms, at any time during the period beginning on the earlier
of (x) the end of the First Refusal Period and (y) the date of receipt by the
CD&R Fund of written notice that Worldwide has elected not to exercise its
rights under this Section 5(a) and ending 30 days thereafter (the "Second
Refusal Period"). The rights provided hereunder shall be exercised by written
notice to the Purchaser given at any time during the applicable period. If such
right is exercised, Worldwide or the CD&R Fund, as the case may be, shall
deliver to the Purchaser a certified or bank check for the Offer Price, payable
to the order of the Purchaser, against delivery of certificates or other
instruments representing the Shares so purchased, appropriately endorsed by the
Purchaser. If such right shall not have been exercised prior to the expiration
of the Second Refusal Period, then at any time during the 30 days following the
expiration of the Second Refusal Period, the Purchaser may sell
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<PAGE>
such Shares to (but only to) the intended purchaser named in his notice to
Worldwide and the CD&R Fund at the Offer Price and on the Offer Terms specified
in such notice, free of all restrictions or obligations imposed by, and free of
any rights or benefits set forth in, Sections 5 through 8, inclusive, of this
Agreement, provided that such intended purchaser shall have agreed in writing to
make and be bound by the representations, warranties and covenants set forth in
Section 3 hereof, other than those set forth in Sections 3(f)(i) and 3(f)(iii),
the first sentence of Section 3(g) and Section 3(h), pursuant to an instrument
of assumption satisfactory in substance and form to Worldwide. The right of the
Purchaser to sell Shares set forth in this Section 5(a), subject to the rights
of first refusal set forth in this Section 5(a), shall be suspended during the
Option Periods referred to in Section 6 hereof, but the provisions of Section 6
shall not otherwise restrict the ability of the Purchaser to sell the Shares,
whether before or after such Option Periods, pursuant to the terms and subject
to the restrictions set forth in this Section 5(a).
(b) Public Offering. In the event that a Public Offering has been
consummated, neither Worldwide nor the CD&R Fund shall have any rights to
purchase the Shares from the Purchaser pursuant to this Section 5 and this
Section 5 shall not apply to a sale as part of a Public Offering or at any time
thereafter.
6. Options Effective on Termination of Employment or Unforeseen
Personal Hardship of the Purchaser.
(a) Termination of Employment. If the Purchaser's active employment
with Worldwide or any Subsidiary thereof that employs the Purchaser is
terminated for any reason whatsoever, Worldwide shall have an option to purchase
all or a portion of the Shares then held by the Purchaser (or, if his employment
was terminated by his death, his estate) and shall have 60 days from the date of
the Purchaser's termination (such 60-day period being hereinafter referred to as
the "First Option Period") during which to give notice in writing to the
Purchaser (or his estate) of its election to exercise or not to exercise such
option, in whole or in part. Worldwide hereby undertakes to use reasonable
efforts to act as promptly as practicable following such termination to make
such election. If Worldwide fails to give notice that it intends to exercise
such option within the First Option Period or Worldwide gives notice that it
does not intend to exercise such option or that it intends to exercise such
option with respect to only a portion of the Shares, the CD&R Fund shall have
the right to purchase all or a portion of the Shares then held by the Purchaser
(or his estate) that will not be repurchased by Worldwide and shall have until
the expiration of the earlier of (x) 60 days following the end of the First
Option Period or (y) 60 days from the date of receipt by the CD&R Fund of
written notice from Worldwide indicating whether it will exercise its option to
purchase any of the Shares (such 60-day period being hereinafter referred to as
the "Second Option Period"), to give notice in writing to the Purchaser (or his
estate) of the CD&R Fund's exercise of its option, in
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whole or in part. If the options of Worldwide and the CD&R Fund to purchase the
Shares pursuant to this subsection are not exercised with respect to all of the
Shares as provided herein (other than as a result of Section 11 hereof), the
Purchaser (or his estate) shall be entitled to retain the Shares which could
have been acquired on exercise thereof, subject to all of the provisions of this
Agreement (including without limitation Section 5(a)). If Worldwide and the CD&R
Fund have failed to exercise their respective options pursuant to this Section
6(a) with respect to all of the Shares within the time periods specified herein,
and if the Purchaser's active employment with Worldwide and each Subsidiary
thereof that employs the Purchaser is terminated (A) by such employer or
employers Without Cause, (B) by the Purchaser by Retirement at Normal Retirement
Age, or (C) by reason of the Disability or death of the Purchaser, then on
notice from the Purchaser (or his estate) in writing and delivered to Worldwide
within 30 days following the earlier of (i) the last day of the Second Option
Period and (ii) the date the CD&R Fund delivers written notice to the Purchaser
indicating whether the CD&R Fund will exercise its option to purchase any of the
Shares, Worldwide shall purchase all (but not less than all) of the Shares then
held by the Purchaser (or his estate). All purchases pursuant to this Section
6(a) by Worldwide or the CD&R Fund shall be for a purchase price and in the
manner prescribed by Section 7 hereof.
(b) Unforeseen Personal Hardship. In the event that the Purchaser,
while in the employment of Worldwide or any Subsidiary thereof, experiences
Unforeseen Personal Hardship, the Board will carefully consider any request by
the Purchaser that Worldwide repurchase the Purchaser's Shares at a price
determined in accordance with Section 7 hereof, but Worldwide shall have no
obligation to repurchase such Shares. The Board shall consider such request with
respect to Unforeseen Personal Hardship as soon as practicable after receipt by
Worldwide of a written request by the Purchaser, such request to include
sufficient details of the Purchaser's Unforeseen Personal Hardship to permit the
Board to review the request and the circumstances in an informed manner.
(c) Certain Definitions. As used in this Agreement the following
terms shall have the following meanings:
(i) "Cause" shall mean (i) the continued and willful failure of the
Purchaser substantially to perform the duties of his or her employment for
Worldwide or any Subsidiary (other than any such failure due to the
Grantee's physical or mental illness) after a demand for substantial
performance has been delivered in writing to the Purchaser by the
executive to whom the Purchaser reports or by the Board, which demand
identifies the manner in which such executive or the Board, as the case
may be, believes that the Purchaser has not substantially performed such
duties, (ii) the Purchaser's engaging in willful and serious misconduct
that has caused or is reasonably expected to result in material injury to
Worldwide or any
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of its Subsidiaries or Affiliates (as defined herein), (iii) the
Purchaser's conviction of, or entering a plea of guilty or nolo contendere
to, a crime that constitutes a felony or (iv) the material breach by the
Purchaser of any of his or her obligations hereunder or under any other
written agreement or covenant with Worldwide or any of its Subsidiaries or
Affiliates.
(ii) "Retirement at Normal Retirement Age" shall mean the
Purchaser's retirement from employment with Worldwide or the Subsidiary
thereof that employs the Purchaser at age 65 or later.
(iii) "Disability" shall mean a physical or mental disability or
infirmity that prevents the performance of the Purchaser's
employment-related duties lasting (or likely to last, based on competent
medical evidence presented to the Board) for a period of six months or
longer. The Board's reasoned and good faith judgment as to Disability
shall be final and shall be based on such competent medical evidence as
shall be presented to it by the Purchaser or by any physician or group of
physicians or other competent medical expert employed by the Purchaser or
Worldwide to advise the Board.
(iv) "Unforeseen Personal Hardship" shall mean financial hardship
arising from (x) extraordinary medical expenses or other expenses directly
related to illness or disability of the Purchaser, a member of the
Purchaser's immediate family or one of the Purchaser's parents or (y)
payments necessary or required to prevent the eviction of the Purchaser
from the Purchaser's principal residence or foreclosure on the mortgage on
that residence. The Board's reasoned and good faith determination of
Unforeseen Personal Hardship shall be binding on Worldwide and the
Purchaser.
(d) Notice of Termination. Worldwide or the Subsidiary thereof that
employs the Purchaser shall give written notice of any termination of the
Purchaser's active employment with each of Worldwide and any Subsidiary thereof
that employs the Purchaser to the CD&R Fund, except that if such termination (if
other than as a result of death) is by the Purchaser, the Purchaser shall give
written notice of such termination to Worldwide and Worldwide shall give written
notice of such termination to the CD&R Fund.
(e) Public Offering. In the event that a Public Offering has been
consummated, none of Worldwide, the CD&R Fund or the Purchaser shall have any
rights to purchase or sell the Shares, as the case may be, pursuant to this
Section 6 and this Section 6 shall not apply to a sale as part of a Public
Offering.
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7. Determination of the Purchase Price; Manner of Payment.
(a) Purchase Price. For the purposes of any purchase of the Shares
pursuant to Section 6, and subject to Section 11(c), the purchase price per
Share to be paid to the Purchaser (or his estate) for each Share (the "Purchase
Price") shall equal the fair market value (the "Fair Market Value") of such
Share as of the effective date of the termination of employment that gives rise
to the right of Worldwide and the CD&R Fund or obligation of Worldwide to
repurchase such Share or, in the case of a repurchase as a result of Unforeseen
Personal Hardship, as of the date such Shares are repurchased (such date of
termination or repurchase, as applicable, the "Determination Date"); provided
that if the Purchaser's employment is terminated by Worldwide or any Subsidiary
thereof for Cause, the Purchase Price for such Share shall equal the lesser of
(i) the Fair Market Value of such Share as of the Determination Date and (ii)
the price at which the Purchaser purchased such Share from Worldwide pursuant to
this Agreement. Whenever determination of the Fair Market Value of a Share is
required by this Agreement, such Fair Market Value shall be such amount as is
determined in good faith by the Board. In making a determination of Fair Market
Value, the Board shall give due consideration to such factors as it deems
appropriate, including, without limitation, the earnings and certain other
financial and operating information of Worldwide and its Subsidiaries in recent
periods, the potential value of Worldwide and its Subsidiaries as a whole, the
future prospects of Worldwide and its Subsidiaries and the industries in which
they compete, the history and management of Worldwide and its Subsidiaries, the
general condition of the securities markets, the fair market value of securities
of companies engaged in businesses similar to those of Worldwide and its
Subsidiaries and the Applicable Share Valuation (as defined below). The
determination of Fair Market Value will not give effect to any restrictions on
transfer of the Shares or the fact that such Shares would represent a minority
interest in Worldwide. For purposes of this Agreement, the term "Applicable
Share Valuation" shall mean the annual valuation of the Common Stock performed
as of the last day of the last fiscal year of Worldwide ending prior to the
Determination Date by an independent valuation firm chosen by the Board, except
that, in the case of a Determination Date occurring during the fourth fiscal
quarter of any fiscal year of Worldwide beginning with the fourth quarter of the
1999 fiscal year of Worldwide, the term "Applicable Share Valuation" shall mean
the annual valuation of the Common Stock performed as of the last day of such
fourth fiscal quarter by an independent valuation firm chosen by the Board. Such
annual valuations shall be performed as promptly as practicable following the
end of each fiscal year of Worldwide, beginning with the 2000 fiscal year of
Worldwide. The Fair Market Value as determined in good faith by the Board and in
the absence of fraud shall be binding and conclusive upon all parties hereto. If
Worldwide at any time subdivides (by any stock split, stock dividend or
otherwise) the Common Stock into a greater number of shares, or combines (by
reverse stock split or otherwise) the Common Stock into a smaller number of
shares, the Purchase Price (including any minimum or maximum Purchase Price
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specified herein or in effect as a result of a prior adjustment) shall be
appropriately adjusted to reflect such subdivision or combination.
(b) Closing of Purchase; Payment of Purchase Price. Subject to
Section 11, the closing of a purchase pursuant to Section 6 shall take place at
the principal office of Worldwide on the tenth business day following whichever
of the following is applicable: (i) the receipt by the Purchaser (or his estate)
of the notice of Worldwide or the CD&R Fund, as the case may be, of its exercise
of its option to purchase any of the Shares pursuant to Section 6(a) or (ii)
Worldwide's receipt of notice from the Purchaser (or his estate) requiring
Worldwide to purchase all of the Shares pursuant to Section 6(a) or (iii) the
Board's determination (which shall be delivered to the Purchaser) that Worldwide
is authorized to purchase Shares as a result of Unforeseen Personal Hardship
pursuant to Section 6(b). At the closing, (i) subject to the proviso below,
Worldwide or the CD&R Fund, as the case may be, shall pay to the Purchaser (or
his estate) an amount equal to the Purchase Price and (ii) the Purchaser (or his
estate) shall deliver to Worldwide such certificates or other instruments
representing the Shares so purchased, appropriately endorsed by the Purchaser
(or his estate), as Worldwide may reasonably require; provided, however, that if
the Determination Date occurs during the first or last fiscal quarter of any
fiscal year of Worldwide, Worldwide or the CD&R Fund, as the case may be, may
elect to pay the Purchase Price in two installments. In any such event, (i) at
the closing of the purchase of the Shares, Worldwide or the CD&R Fund, as the
case may be, shall pay to the Purchaser (or his estate) an amount (the "First
Installment Amount") equal to 80% of the Fair Market Value of the Shares,
determined pursuant to Section 7(a) hereof on the basis of the most recent
available valuation of the Shares, and (ii) no later than the tenth business day
following receipt by Worldwide of the Applicable Share Valuation, Worldwide or
the CD&R Fund, as the case may be, shall pay an additional amount to the
Purchaser (or his estate) equal to the sum of (1) the excess (the "Excess
Payment"), if any, of (A) the Purchase Price for the Shares, over (B) the First
Installment Amount and (2) an amount calculated by multiplying the Excess
Payment by a percentage equal to the average annual cost to Worldwide of its and
its Subsidiaries bank indebtedness obligations outstanding during the period
commencing on the closing date of the purchase of the Shares and ending on the
date of payment of such additional amount pursuant to this clause (ii) or, if
there are no such obligations outstanding, one percentage point greater than the
average annual prime rate charged during such period by Chase Bank or such other
nationally recognized bank designated by Worldwide.
(c) Application of the Purchase Price to Certain Loans. The
Purchaser agrees that Worldwide and the CD&R Fund shall be entitled to apply any
amounts to be paid by Worldwide or the CD&R Fund, as the case may be, to
repurchase Shares pursuant to Section 5 or 6 hereof to discharge any
indebtedness of the Purchaser to Worldwide or any Subsidiary thereof or
indebtedness that is guaranteed by Worldwide or any such
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Subsidiary, which indebtedness was incurred by the Purchaser in connection with
his purchase of any shares of Common Stock, including the Shares.
8. Drag-Along Rights.
(a) Drag-Along Notice. If the CD&R Fund intends to effect a sale of
51% or more of its shares of common stock of Worldwide to a third party (a
"Third Party Buyer") and the CD&R Fund elects to exercise its rights under this
Section 8, the CD&R Fund shall deliver written notice (a "Drag-Along Notice") to
the Purchaser, which notice shall (a) state (i) that the CD&R Fund wishes to
exercise its rights under this Section 8 with respect to such sale, (ii) the
name and address of the Third Party Buyer, (iii) the per share amount and form
of consideration the CD&R Fund proposes to receive for its shares of common
stock of Worldwide and (iv) the terms and conditions of payment of such
consideration and all other material terms and conditions of such sale, (b)
contain an offer (the "Drag-Along Offer") by the Third Party Buyer to purchase
from the Purchaser a percentage of his Shares equal to the percentage of the
shares of common stock of Worldwide owned by the CD&R Fund that are to be sold
to the Third Party Buyer (such percentage, the "Applicable Percentage") on and
subject to the same terms and conditions offered to the CD&R Fund and (c) state
the anticipated time and place of the closing of the purchase and sale of the
Applicable Percentage of the Shares (a "Section 8 Closing"), which (subject to
such terms and conditions) shall occur not fewer than five (5) days nor more
than ninety (90) days after the date such Drag-Along Notice is delivered,
provided that if such Section 8 Closing shall not occur prior to the expiration
of such 90-day period, the CD&R Fund shall be entitled to deliver additional
Drag-Along Notices with respect to such Drag-Along Offer.
(b) Conditions to Drag-Along. Upon delivery of a Drag-Along Notice,
the Purchaser shall have the obligation to sell and transfer to the Third Party
Buyer the Applicable Percentage of the Purchaser's Shares pursuant to the
Drag-Along Offer, as the same may be modified from time to time, provided that
the CD&R Fund sells and transfers the Applicable Percentage of its shares of
common stock of Worldwide to the Third Party Buyer at the Section 8 Closing.
Within 10 days of receipt of the Drag-Along Notice, the Purchaser shall (i)
execute and deliver to the CD&R Fund a power of attorney and a letter of
transmittal and custody agreement appointing, and in form and substance
reasonably satisfactory to, the CD&R Fund or one or more of its affiliates
designated by the CD&R Fund (the "Custodian"), the true and lawful
attorney-in-fact and custodian for the Purchaser, with full power of
substitution, and authorizing the Custodian to take such actions as the
Custodian may deem necessary or appropriate to effect the sale and transfer of
the Applicable Percentage of the Shares to the Third Party Buyer, upon receipt
of the purchase price therefor at the Section 8 Closing, free and clear of all
security interests, liens, claims, encumbrances, charges, options, restrictions
on transfer, proxies and voting
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and other agreements of whatever nature, and to take such other action as may be
necessary or appropriate in connection with such sale or transfer, including
consenting to any amendments, waivers, modifications or supplements to the terms
of the sale (provided that the CD&R Fund also so consents, and, to the extent
applicable, sells and transfers the Applicable Percentage of its shares of
common stock of Worldwide on the same terms as so amended, waived, modified or
supplemented) and (ii) deliver to the Custodian certificates representing the
Applicable Percentage of the Shares, together with all necessary duly executed
stock powers. The Custodian shall hold the Applicable Percentage of the Shares
and other documents in trust for the Purchaser pending completion or abandonment
of such sale. If, within 90 days after the CD&R Fund delivers the Drag-Along
Notice, the CD&R Fund has not completed the sale of the Applicable Percentage of
the Shares and of its shares of common stock of Worldwide to the Third Party
Buyer and another Drag-Along Notice with respect to such Drag-Along Offer has
not been sent to the Purchaser, the Custodian shall return to the Purchaser all
certificates representing the Applicable Percentage of the Shares and all other
documents that the Purchaser delivered in connection with such sale. Promptly
after the Section 8 Closing, the Custodian shall give notice thereof to the
Purchaser, shall remit to the Purchaser the total consideration for the
Applicable Percentage of the Shares sold pursuant thereto (reduced by any amount
required to be held in escrow pursuant to the terms of the purchase and sale
agreement), and shall furnish such other evidence of the completion and time of
completion of such sale and the terms thereof as may reasonably be requested by
the Purchaser.
(c) Remedies. The Purchaser acknowledges that the CD&R Fund would be
irreparably damaged in the event of a breach or a threatened breach by the
Purchaser of any of its obligations under this Section 8 and the Purchaser
agrees that, in the event of a breach or a threatened breach by the Purchaser of
any such obligation, the CD&R Fund shall, in addition to any other rights and
remedies available to it in respect of such breach, be entitled to an injunction
from a court of competent jurisdiction (without any requirement to post bond)
granting it specific performance by the Purchaser of its obligations under this
Section 8. In the event that the CD&R Fund shall file suit to enforce the
covenants contained in this Section 8 (or obtain any other remedy in respect of
any breach thereof), the prevailing party in the suit shall be entitled to
recover, in addition to all other damages to which it may be entitled, the costs
incurred by such party in conducting the suit, including reasonable attorney's
fees and expenses. In the event that, following a breach or a threatened breach
by the Purchaser of the provisions of this Section 8, the CD&R Fund does not
obtain an injunction granting it specific performance of the Purchaser's
obligations under this Section 8 in connection with such proposed sale prior to
the time the CD&R Fund completes the sale of the Applicable Percentage of its
shares of common stock of Worldwide or, in its sole discretion, abandons such
sale, then Worldwide shall have the option to purchase all of the Shares from
the Purchaser at a purchase price per Share equal to the price at which the
Purchaser purchased such shares of
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<PAGE>
Common Stock from Worldwide or, if less, the per share consideration payable
pursuant to the Drag-Along Offer.
(d) Public Offering. In the event that a Public Offering has been
consummated, the provisions of this Section 8 shall terminate and cease to have
further effect.
9. Representations and Warranties of Worldwide. Worldwide represents
and warrants to the Purchaser that (a) Worldwide has been duly incorporated and
is an existing corporation in good standing under the laws of the State of
Delaware, (b) this Agreement has been duly authorized, executed and delivered by
Worldwide and constitutes a valid and legally binding obligation of Worldwide
enforceable against Worldwide in accordance with its terms, and (c) the Shares,
when issued, delivered and paid for in accordance with the terms hereof, will be
duly and validly issued, fully paid and nonassessable, and free and clear of any
liens or encumbrances other than those created pursuant to this Agreement, or
otherwise in connection with the transactions contemplated hereby.
10. Covenants of Worldwide.
(a) Rule 144. Worldwide agrees that at all times after it has filed
a registration statement after the date hereof pursuant to the requirements of
the Securities Act or Section 12 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), relating to any class of equity securities of
Worldwide (other than (i) the registration of equity securities of Worldwide
and/or options in respect thereof to be offered primarily to directors or
members of management or employees of Worldwide, any Subsidiary thereof or any
of their respective predecessors, or to senior executives of, or consultants to,
corporations in which entities managed or sponsored by Clayton, Dubilier & Rice,
Inc. have or have made equity investments, or (ii) the registration of equity
securities and/or options in respect thereof solely on Form S-4 or S-8 or any
successor form), it will file the reports required to be filed by it under the
Securities Act and the Exchange Act and the rules and regulations adopted by the
Commission thereunder (or, if Worldwide is not required to file such reports, it
will, upon the request of the Purchaser, make publicly available such
information as necessary to permit sales pursuant to Rule 144 under the
Securities Act), and will take such further action as the Purchaser may
reasonably request, all to the extent required from time to time to enable the
Purchaser to sell Shares without registration under the Securities Act within
the limitation of the exemptions provided by (i) Rule 144, as such Rule may be
amended from time to time, or (ii) any successor rule or regulation hereafter
adopted by the Commission.
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(b) State Securities Laws. Worldwide agrees to use its best efforts
to comply with all state securities or "blue sky" laws applicable to the sale of
the Shares to the Purchaser, provided that Worldwide shall not be obligated to
qualify or register the Shares under any such law or to qualify as a foreign
corporation or file any consent to service of process under the laws of any
jurisdiction or subject itself to taxation as doing business in any such
jurisdiction.
11. Certain Restrictions on Repurchases.
(a) Financing Agreements, etc. Notwithstanding any other provision
of this Agreement, Worldwide shall not be permitted or obligated to repurchase
any Shares from the Purchaser if (i) such repurchase (or the payment of a
dividend by a Subsidiary to Worldwide to fund such repurchase) would result in a
violation of the terms or provisions of, or result in a default or an event of
default under any of the Credit Agreement, dated as of November 19, 1999 and
amended as of November 23, 1999, among North American Van Lines, Inc. ("NAVL"),
the Foreign Subsidiary Borrowers from time to time party thereto, the several
banks and financial institutions from time to time party thereto, the Bank of
New York, as documentation agent, Banc of America Securities, LLC, as
syndication agent, and The Chase Manhattan Bank, as administrative agent, the
Indenture dated as of November 19, 1999, among NAVL, certain subsidiaries of
NAVL, as guarantors, and State Street Bank and Trust Company, as Trustee, any
other guaranty, financing or security agreement or document entered into (x) by
Worldwide or any subsidiary that is in effect on or after the date hereof (y) in
connection with the operations of Worldwide or its Subsidiaries from time to
time, or (z) to refinance or replace any indebtedness described in this Section
11(a) (such agreements and documents, as each may be amended, modified or
supplemented from time to time, are referred to herein as the "Financing
Agreements"), in each case as the same may be amended, modified or supplemented
from time to time, or (ii) such repurchase would violate any of the terms or
provisions of the Certificate of Incorporation of Worldwide, or (iii) Worldwide
has no funds legally available therefor under the General Corporation Law of the
State of Delaware.
(b) Delay of Repurchase. In the event that a repurchase by Worldwide
otherwise permitted or required under Section 6(a) is prevented solely by the
terms of Section 11(a), (i) such repurchase will be postponed and will take
place without the application of further conditions or impediments (other than
as set forth in Section 7 hereof or in this Section 11) at the first opportunity
thereafter when Worldwide has funds legally available therefor and when such
repurchase will not result in any default, event of default or violation under
any of the Financing Agreements or in a violation of any term or provision of
the Certificate of Incorporation of Worldwide and (ii) such repurchase
obligation shall rank against other similar repurchase obligations with respect
to shares of
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<PAGE>
Common Stock or options in respect thereof according to priority in time of the
effective date of the termination of employment giving rise to such repurchase,
provided that any such repurchase obligations as to which a common date
determines priority shall be of equal priority and shall share pro rata in any
repurchase payments made pursuant to clause (i) above and provided, further,
that any repurchase commitment arising from Disability, death, Retirement at
Normal Retirement Age or any repurchase commitment made by the Board pursuant to
Section 6(b) or the comparable provisions of any other applicable management
stock subscription agreement shall have priority over any other repurchase
obligation.
(c) Purchase Price Adjustment. In the event that a repurchase of
Shares from the Purchaser is delayed pursuant to this Section 11, the purchase
price per Share when the repurchase of such Shares eventually takes place as
contemplated by Section 11(b) shall equal the sum of (i) the Purchase Price
determined in accordance with Section 7 hereof at the time that the repurchase
of such Shares would have occurred but for the operation of this Section 11,
plus (ii) an amount equal to interest on such Purchase Price for the period from
the date on which the completion of the repurchase would have taken place but
for the operation of this Section 11 to the date on which such repurchase
actually takes place (the "Delay Period") at a rate equal to the average annual
cost to Worldwide of its and its Subsidiaries bank indebtedness obligations
outstanding during the Delay Period or, if there are no such obligations
outstanding, one percentage point greater than the average prime rate charged
during such period by Chase Bank or such other nationally recognized bank
designated by Worldwide.
12. Miscellaneous.
(a) Notices. All notices and other communications required or
permitted to be given under this Agreement shall be in writing and shall be
deemed to have been given if delivered personally or sent by certified or
express mail, return receipt requested, postage prepaid, or by any recognized
international equivalent of such delivery, to Worldwide, the CD&R Fund or the
Purchaser, as the case may be, at the following addresses or to such other
address as Worldwide, the CD&R Fund or the Purchaser, as the case may be, shall
specify by notice to the others:
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(i) if to Worldwide, to it at:
c/o North American Van Lines, Inc.
Law Department
5501 U.S. Highway 30 West
Fort Wayne, Indiana 46801
Attention: General Counsel
(ii) if to the Purchaser, to the Purchaser at the address set forth
on the signature page hereof.
(iii) if to the CD&R Fund, to:
Clayton, Dubilier & Rice Fund V Limited Partnership
1403 Foulk Road, Suite 106
Wilmington, Delaware 19803
Attention: Joseph L. Rice, III
All such notices and communications shall be deemed to have been received on the
date of delivery if delivered personally or on the third business day after the
mailing thereof. Copies of any notice or other communication given under this
Agreement shall also be given to:
Clayton, Dubilier & Rice, Inc.
375 Park Avenue, 18th Floor
New York, New York 10152
Attention: Kevin J. Conway
and
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Attention: Paul S. Bird, Esq.
The CD&R Fund also shall be given a copy of any notice or other communication
between the Purchaser and Worldwide under this Agreement at its address as set
forth above.
(b) Binding Effect; Benefits. This Agreement shall be binding upon
and inure to the benefit of the parties to this Agreement and their respective
successors and
17
<PAGE>
assigns. Except as provided in Sections 4 through 8, inclusive, nothing in this
Agreement, express or implied, is intended or shall be construed to give any
person other than the parties to this Agreement or their respective successors
or assigns any legal or equitable right, remedy or claim under or in respect of
any agreement or any provision contained herein.
(c) Waiver; Amendment.
(i) Waiver. Any party hereto may by written notice to the other
parties (A) extend the time for the performance of any of the obligations
or other actions of the other parties under this Agreement, (B) waive
compliance with any of the conditions or covenants of the other parties
contained in this Agreement, and (C) waive or modify performance of any of
the obligations of the other parties under this Agreement, provided that
any waiver of the provisions of Sections 4 through 8, inclusive, must be
consented to by the CD&R Fund. Except as provided in the preceding
sentence, no action taken pursuant to this Agreement, including, without
limitation, any investigation by or on behalf of any party, shall be
deemed to constitute a waiver by the party taking such action of
compliance with any representations, warranties, covenants or agreements
contained herein. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a waiver
of any preceding or succeeding breach and no failure by a party to
exercise any right or privilege hereunder shall be deemed a waiver of such
party's rights or privileges hereunder or shall be deemed a waiver of such
party's rights to exercise the same at any subsequent time or times
hereunder.
(ii) Amendment. This Agreement may be amended, modified or
supplemented only by a written instrument executed by the Purchaser and
Worldwide, provided that any amendment adversely affecting the rights of
the CD&R Fund hereunder must be consented to by the CD&R Fund. The parties
hereto acknowledge that Worldwide's consent to an amendment or
modification of this Agreement is subject to the terms and provisions of
the Financing Agreements.
(d) Assignability. Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by Worldwide or the Purchaser without the prior written consent of
the other parties. The CD&R Fund may assign from time to time all or any portion
of its rights under Sections 4 through 8, inclusive, to one or more persons or
other entities designated by it.
(e) Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE
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OF DELAWARE, REGARDLESS OF THE LAW THAT MIGHT BE APPLIED UNDER PRINCIPLES OF
CONFLICT OF LAWS.
(f) Section and Other Headings, etc. The section and other headings
contained in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
(g) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.
(h) Certain Definitions.
"Affiliate": with respect to any Person, means any other Person
that, directly or indirectly through one or more intermediaries, Controls, is
Controlled by, or is under common Control with the first Person, including but
not limited to a Subsidiary of the first Person, a Person of which the first
Person is a Subsidiary, or another Subsidiary of a Person of which the first
Person is also a Subsidiary.
"Control": with respect to any Person, means the possession,
directly or indirectly, severally or jointly, of the power to direct or cause
the direction of the management policies of such Person, whether through the
ownership of voting securities, by contract or credit arrangement, as trustee or
executor, or otherwise.
"Person": any natural person, firm, partnership, limited liability
company, association, corporation, company, trust, business trust, governmental
authority or other entity.
"Subsidiary": with respect to any Person, each corporation or other
Person in which the first Person owns or Controls, directly or indirectly,
capital stock or other ownership interests representing 50% or more of the
combined voting power of the outstanding voting stock or other ownership
interests of such corporation or other Person.
"Successor": of a Person means a Person that succeeds to the first
Person's assets and liabilities by merger, liquidation, dissolution or otherwise
by operation of law, or a Person to which all or substantially all the assets
and/or business of the first Person are transferred.
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<PAGE>
IN WITNESS WHEREOF, Worldwide and the Purchaser have executed this
Agreement as of the date first above written.
ALLIED WORLDWIDE, INC.
By:______________________________________
Name:
Title:
THE PURCHASER:
(Name)
By:______________________________________
as Attorney-in-Fact
Name:
Address of the Purchaser:
(Address)
Total Number of Shares
of Common Stock to be
Purchased: (Shares)
Total Purchase
Price: $(Share Amount)
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Exhibit 10.14
FORM OF MANAGEMENT STOCK OPTION AGREEMENT
MANAGEMENT STOCK OPTION AGREEMENT, dated as of __________, by and
between Allied Worldwide, Inc. (formerly NA Holding Corporation), a Delaware
corporation ("Worldwide"), and the grantee whose name appears on the signature
page hereof (the "Grantee").
W I T N E S S E T H:
WHEREAS, to motivate key employees of Worldwide and the Subsidiaries
by providing them an ownership interest in Worldwide, the Board of Directors of
Worldwide (the "Board") has established the Allied Worldwide, Inc. Stock
Incentive Plan (formerly the NA Holding Corporation Stock Incentive Plan), as
the same may be amended from time to time (the "Plan"); and
WHEREAS, the Grantee has purchased the number of shares of Common
Stock, par value $____ per share, of Worldwide (the "Common Stock") set forth on
the signature page to the Management Stock Subscription Agreement, dated as of
the date hereof, between Worldwide and the Grantee;
WHEREAS, pursuant to the Plan, the Board has authorized the grant to
the Grantee of non-qualified stock options to purchase the aggregate number of
shares of Common Stock set forth on the signature page hereof (each, a "Share"
and, collectively, the "Shares"), at an exercise price per Share of $_____ and
WHEREAS, the Grantee and Worldwide desire to enter into an agreement
to evidence and confirm the grant of such stock options on the terms and
conditions set forth herein;
NOW, THEREFORE, to evidence the stock options so granted, and to set
forth the terms and conditions governing such stock options, Worldwide and the
Grantee hereby agree as follows:
1. Certain Definitions. As used in this Agreement, the following
terms shall have the following meanings:
(a) "Affiliate" shall mean, with respect to any person, any other
person controlled by, controlling or under common control with such
person.
(b) "Annual EBITDA Target" shall mean, with respect to each of the
five Fiscal Years after the date hereof that are included in the Business
Plan, the EBITDA targeted for such Fiscal Year in the Business Plan;
provided, however, that in the event Worldwide or any Subsidiary
consummates a significant acquisition, disposition or other corporate
transaction or series of transactions
<PAGE>
that, in the judgment of the Board, would reasonably be expected to impact
the consolidated earnings of Worldwide and the Subsidiaries, the EBITDA
Target for the relevant Fiscal Years may be appropriately adjusted by the
Board to reflect such transaction or series of transactions.
(c) "Applicable Percentage" shall mean, as of any date of
determination, the excess of (i) the quotient, expressed as a percentage,
of (x) the actual, aggregate EBITDA achieved by Worldwide and the
Subsidiaries during the Measurement Period divided by (y) the Cumulative
EBITDA Target over (ii) the percentage, if any, of all of the Performance
Options granted to the Grantee hereunder that have become vested in
accordance with Section 3(b)(ii) prior to such date of determination.
(d) "Applicable Share Valuation" shall mean the annual valuation of
the Shares performed by an independent valuation firm chosen by the Board
as of the last day of the last Fiscal Year ending prior to the
Determination Date, except that, in the case of a Determination Date
occurring during the fourth fiscal quarter of any Fiscal Year beginning
with the fourth quarter of the 1999 Fiscal Year, the term "Applicable
Share Valuation" shall mean the annual valuation of the Shares performed
by an independent valuation firm chosen by the Board as of the last day of
such fourth fiscal quarter. Such annual valuations shall be performed for
the 2000 Fiscal Year and for each Fiscal Year ending thereafter and prior
to any initial Public Offering as promptly as practicable following the
end of each such Fiscal Year.
(e) "Board" shall mean the Board of Directors of Worldwide.
(f) "Business Plan" shall mean the business plan of Worldwide and
the Subsidiaries for the first five Fiscal Years after the date hereof, as
adopted by the Board.
(g) "CD&R Fund" shall mean Clayton, Dubilier & Rice Fund V Limited
Partnership, a Cayman Islands exempted limited partnership, and any
successor investment vehicle managed by Clayton, Dubilier & Rice, Inc.
(h) "Cause" shall mean (i) the continued and willful failure of the
Grantee substantially to perform the duties of his or her employment for
Worldwide or any Subsidiary (other than any such failure due to the
Grantee's physical or mental illness) after a demand for substantial
performance has been delivered in writing to the Grantee by the executive
to whom the Grantee reports or by the Board, which demand identifies the
manner in which such executive or the Board, as the case may be, believes
that the Grantee has not substantially performed such
2
<PAGE>
duties, (ii) the Grantee's engaging in willful and serious misconduct that
has caused or is reasonably expected to result in material injury to
Worldwide or any of its Subsidiaries or Affiliates, (iii) the Grantee's
conviction of, or entering a plea of guilty or nolo contendere to, a crime
that constitutes a felony or (iv) the material breach by the Grantee of
any of his or her obligations hereunder or under any other written
agreement or covenant with Worldwide or any of its Subsidiaries or
Affiliates.
(i) "Change in Control" shall mean the first to occur of the
following events after the date hereof:
(i) the acquisition by any person, entity or "group" (as
defined in Section 13(d) of the Exchange Act), other than Worldwide,
the Subsidiaries, any employee benefit plan of Worldwide or the
Subsidiaries, the CD&R Fund or any Affiliate of the CD&R Fund, of
50% or more of the combined voting power of Worldwide's or North
American Van Lines's ("NAVL") then outstanding voting securities;
(ii) the merger or consolidation of Worldwide or NAVL, as a
result of which persons who were stockholders of Worldwide or NAVL,
as the case may be, immediately prior to such merger or
consolidation, do not, immediately thereafter, own, directly or
indirectly, more than 50% of the combined voting power entitled to
vote generally in the election of directors of the merged or
consolidated company;
(iii) the liquidation or dissolution of Worldwide or NAVL
other than a liquidation of Worldwide or NAVL into the other or into
any Subsidiary; and
(iv) the sale, transfer or other disposition of all or
substantially all of the assets of Worldwide or NAVL to one or more
persons or entities that are not, immediately prior to such sale,
transfer or other disposition, Affiliates of Worldwide, NAVL or the
CD&R Fund.
(j) "Change in Control Price" shall mean the price per share of
Common Stock paid in conjunction with any transaction resulting in a
Change in Control (as determined in good faith by the Board if any part of
such price is payable other than in cash).
(k) "Common Stock" shall mean the Common Stock, par value $.01 per
share, of Worldwide.
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(l) "Covered Options" shall have the meaning set forth in Section
4(b) hereof.
(m) "Cumulative EBITDA Target" shall mean the sum of the Annual
EBITDA Targets for each of the first five Fiscal Years included in the
Business Plan, as the same may be adjusted from time to time in accordance
with this Agreement.
(n) "Delay Period" shall have the meaning set forth in Section 10(c)
hereof.
(o) "Determination Date" shall mean the effective date of any
termination of the Grantee's employment that gives rise to the successive
rights of Worldwide and the CD&R Fund to purchase Covered Options pursuant
to Section 5(c).
(p) "Disability" shall mean a physical or mental disability or
infirmity that prevents the performance of the Grantee's
employment-related duties lasting (or likely to last, based on competent
medical evidence presented to the Board) for a period of six months or
longer. The Board's reasoned and good faith judgment as to Disability
shall be final and shall be based on such competent medical evidence as
shall be presented to it by the Grantee or by any physician or group of
physicians or other competent medical expert employed by the Grantee or
Worldwide to advise the Board.
(q) "EBITDA" shall have the meaning assigned to such term in the
Credit Agreement, dated as of November 19, 1999 and amended as of November
23, 1999 (the "Credit Agreement"), among North American Van Lines, Inc.
("NAVL"), the Foreign Subsidiary Borrowers from time to time party
thereto, the several banks and financial institutions from time to time
party thereto, The Bank of New York, as documentation agent, Banc of
America Securities LLC, as syndication agent, and The Chase Manhattan
Bank, as administrative agent, as such agreement may be amended from time
to time, or, if such agreement is no longer in effect and NAVL is party to
a credit agreement that has replaced or refinanced the Credit Agreement or
any successor credit agreement, as defined in such other credit agreement
as shall then be in effect.
(r) "Exchange Act" shall mean the U.S. Securities Exchange Act of
1934, as amended.
(s) "Exercise Date" shall have the meaning set forth in Section 6
hereof.
(t) "Exercise Price" shall have the meaning set forth in Section 6
hereof.
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(u) "Exercise Shares" shall have the meaning set forth in Section 6
hereof.
(v) "Extraordinary Termination" shall mean a termination of the
Grantee's employment with Worldwide and the Subsidiaries by reason of the
Grantee's death, Disability or Retirement.
(w) "Fair Market Value" shall mean, as of any date, the fair market
value on such date of a share of Common Stock as determined in good faith
by the Board. In making a determination of Fair Market Value, the Board
shall give due consideration to such factors as it deems appropriate,
including, without limitation, the earnings and certain other financial
and operating information of Worldwide and the Subsidiaries in recent
periods, the potential value of Worldwide and the Subsidiaries as a whole,
the future prospects of Worldwide and the Subsidiaries and the industries
in which they compete, the history and management of Worldwide and the
Subsidiaries, the general condition of the securities markets, the fair
market value of securities of companies engaged in businesses similar to
those of Worldwide and the Subsidiaries and the Applicable Share
Valuation. The determination of Fair Market Value will not give effect to
any restrictions on transfer of the shares of Common Stock or the fact
that such Common Stock would represent a minority interest in Worldwide.
Notwithstanding the foregoing, following a Public Offering, Fair Market
Value shall mean the average of the high and low trading prices for a
share of Common Stock on the primary national exchange (including NASDAQ)
on which the Common Stock is then traded on the trading day immediately
preceding the date as of which such Fair Market Value is determined.
(x) "Financing Agreements" shall have the meaning set forth in
Section 10(a) hereof.
(y) "First Purchase Period" shall have the meaning set forth in
Section 5(c)(i) hereof.
(z) "Fiscal Year" shall mean a fiscal year of Worldwide ending
December 31.
(aa) "Grant Date" shall mean the date hereof, which is the date on
which the Options are granted to the Grantee.
(bb) "Grantee" shall have the meaning set forth in the introductory
paragraph hereto.
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(cc) "Management Stock Subscription Agreement" shall mean the
management stock subscription agreement, substantially in the form of the
draft thereof attached as an exhibit to the Plan or such other form as the
Grantee and Worldwide may agree, to be entered into by Worldwide and the
Grantee in connection with the Grantee's exercise of any of the Options
and purchase of the Shares subject to any such Options pursuant to Section
6 hereof.
(dd) "Measurement Period" shall mean, as of any date of
determination, the period commencing on the first day of the first Fiscal
Year included in the Business Plan and, subject to Section 9(b), ending on
the last day of the Fiscal Year ending coincident with or immediately
prior to such date of determination.
(ee) "New Employer" shall mean the Grantee's employer, or the parent
or a subsidiary of such employer, immediately following a Change in
Control.
(ff) "Normal Termination Date" shall mean the tenth anniversary of
the date hereof.
(gg) "Option" shall mean the right granted to the Grantee hereunder
to purchase one share of Common Stock for a purchase price equal to the
Option Price and otherwise subject to the terms and conditions of this
Agreement. The term "Options" shall mean, collectively, the Performance
Options and the Service Options granted to the Grantee hereby.
(hh) "Option Price" shall mean, with respect to each Share covered
by an Option, the exercise price at which the Grantee may purchase such
Share specified in Section 2(b) hereof.
(ii) "Performance Options" shall mean those Options that are subject
to the provisions of Section 3(b) hereof providing for the vesting of such
Options on the basis of the financial performance of Worldwide and the
Subsidiaries and the continued employment of the Grantee. Performance
Options have been granted to the Grantee pursuant to this Agreement with
respect to the number of Shares specified on the signature page hereof
under the heading "Performance Options."
(jj) "Plan" shall have the meaning set forth in the recitals hereto.
(kk) "Public Offering" shall mean the first day as of which sales of
Common Stock are made to the public in the United States pursuant to an
underwritten public offering of the Common Stock led by one or more
underwriters at least one of which is an underwriter of nationally
recognized standing.
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(ll) "Purchase Price" shall have the meaning set forth in Section
5(f).
(mm) "Registration and Participation Agreement" shall have the
meaning set forth in Section 7(f) hereof.
(nn) "Retirement" shall mean the Grantee's retirement from
employment with Worldwide and the Subsidiaries at or after age 65.
(oo) "Rule 144" shall mean Rule 144 promulgated under the Securities
Act.
(pp) "Second Purchase Period" shall have the meaning set forth in
Section 5(c)(i) hereof.
(qq) "Securities Act" shall mean the U.S. Securities Act of 1933, as
amended.
(rr) "Service Options" shall mean those Options that are subject to
the provisions of Section 3(a) hereof providing for the vesting of such
Options on the basis of the Grantee's completion of service. Service
Options have been granted to the Grantee pursuant to this Agreement with
respect to the number of Shares specified on the signature page hereof
under the heading "Service Options."
(ss) "Shares" shall have the meaning specified in the preambles
hereto.
(tt) "Subsidiary" shall mean any corporation or other person, a
majority of whose outstanding voting securities or other equity interests
are owned, directly or indirectly, by Worldwide.
2. Grant of Options.
(a) Confirmation of Grant. Worldwide hereby evidences and confirms
its grant to the Grantee, effective as of the date hereof, of (i) Service
Options to purchase the number of Shares specified on the signature page hereof
under the heading "Service Options" and (ii) Performance Options to purchase the
number of Shares specified on the signature page hereof under the heading
"Performance Options". The Options are not intended to be incentive stock
options under the U.S. Internal Revenue Code of 1986, as amended. This Agreement
is subordinate to, and the terms and conditions of the Options granted hereunder
are subject to, the terms and conditions of the Plan. If there is any
inconsistency between the terms hereof and the terms of the Plan, the terms of
the Plan shall govern.
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(b) Option Price. Each Share covered by an Option shall have an
Option Price of $142.
3. Exercisability.
(a) Service Options. Except as otherwise provided in Section 9(a) of
this Agreement and subject to the continuous employment of the Grantee with
Worldwide or one or more of the Subsidiaries until the applicable vesting date,
the Service Options shall become vested in five equal annual installments, on
each of the first five anniversaries of the Grant Date.
(b) Performance Options. Except as otherwise provided in Section
9(b) of this Agreement and subject to the continuous employment of the Grantee
with Worldwide or one or more of the Subsidiaries until the applicable vesting
date, the Performance Options shall become vested as follows:
(i) 100% of the Performance Options shall become vested as of the
first day of the Fiscal Year immediately following the Fiscal Year, if
any, that the actual aggregate EBITDA achieved by Worldwide and the
Subsidiaries during the Measurement Period equals or exceeds the
Cumulative EBITDA Target;
(ii) the number of Performance Options equal to the product of (x)
the Applicable Percentage multiplied by (y) the total number of
Performance Options granted hereunder shall become vested on the last day
of each of the first five Fiscal Years after the Grant Date, such
Applicable Percentage to be determined as of the last day of such Fiscal
Year, provided in each such case that Worldwide and the Subsidiaries have
achieved at least 75% of the Annual EBITDA Target for such Fiscal Year;
and
(iii) any Performance Options that do not become vested in
accordance with either of the preceding clauses (i) or (ii) shall become
vested on the ninth anniversary of the Grant Date.
The Board shall determine in good faith whether and the extent to which
Worldwide and the Subsidiaries have achieved the Annual EBITDA Targets and the
Cumulative EBITDA Target and the determination of the Board shall be conclusive.
(c) Conditions. The Board, in its sole discretion, may accelerate
the vesting or exercisability of any Option, all Options or any class of
Options, at any time and from time to time. Shares covered by vested Options
may, subject to the provisions hereof, be purchased at any time and from time to
time on or after the date the corresponding Options become vested in accordance
with the provisions of this Section 3
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until the date one day prior to the date on which such Options terminate,
provided that any such purchase shall be effected pursuant to and subject to
Sections 5 and 6 hereof and the provisions contained in the Management Stock
Subscription Agreement related to the purchase of such Shares.
4. Termination of Options.
(a) Normal Termination Date. Subject to Sections 4(b) and 9, the
Options shall terminate and be canceled on the Normal Termination Date.
(b) Early Termination. If the Grantee's employment with Worldwide or
any Subsidiary is voluntarily or involuntarily terminated for any reason prior
to the Normal Termination Date, any Options held by the Grantee that have not
become vested on or before the effective date of such termination of employment
shall terminate and be canceled immediately upon such termination of employment.
Subject to the provisions of Sections 5(c) and 9, all Options held by the
Grantee on the effective date of such termination of employment that shall have
become vested on or before such effective date (such Options, the Covered
Options") shall remain exercisable for whichever of the following periods is
applicable, and if not exercised within such period, shall automatically
terminate and be canceled upon the expiration of such period: (i) if the
Grantee's employment is terminated by reason of an Extraordinary Termination,
the Covered Options shall remain exercisable solely until the first to occur
of (A) the six month anniversary of the effective date of the Grantee's
termination of employment or (B) the Normal Termination Date and (ii) if the
Grantee's employment is terminated for any reason other than (x) an
Extraordinary Termination or (y) for Cause, the Covered Options shall remain
exercisable solely until the first to occur of (x) the 60th day following the
earliest to occur of (1) the expiration of the Second Purchase Period, and (2)
the receipt by the Grantee of written notice that the CD&R Fund does not intend
to exercise its right to purchase the Covered Options pursuant to Section
5(c)(i) and (y) the Normal Termination Date. Notwithstanding anything else
contained in this Agreement, if the Grantee's employment with Worldwide or any
Subsidiary is terminated for Cause, all Options (whether or not then vested or
exercisable) shall automatically terminate and be canceled immediately upon such
termination. Nothing in this Agreement shall be deemed to confer on the Grantee
any right to continue in the employ of Worldwide or any Subsidiary, or to
interfere with or limit in any way the right of Worldwide or any Subsidiary to
terminate such employment at any time.
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5. Restrictions on Exercise; Non-Transferability of Options;
Repurchase of Options.
(a) Restrictions on Exercise. Once vested in accordance with the
provisions of this Agreement, the Options may be exercised only with respect to
full shares of Common Stock. No fractional shares of Common Stock shall be
issued. Notwithstanding any other provision of this Agreement, the Options may
not be exercised in whole or in part, and no certificates representing Shares
shall be delivered, (i) (A) unless all requisite approvals and consents of any
governmental authority of any kind having jurisdiction over the exercise of the
Options shall have been secured, (B) unless the purchase of the Shares upon the
exercise of the Options shall be exempt from registration under applicable U.S.
federal and state securities laws, and applicable non-U.S. securities laws, or
the Shares shall have been registered under such laws, and (C) unless all
applicable U.S. federal, state and local and non-U.S. tax withholding
requirements shall have been satisfied or (ii) if such exercise would result in
a violation of the terms or provisions of or a default or an event of default
under, any of the Financing Agreements. Worldwide shall use commercially
reasonable efforts to obtain the consents and approvals referred to in clause
(i)(A) of the preceding sentence and to obtain the consent of the parties to the
Financing Agreements referred to in clause (ii) of the preceding sentence so as
to permit the Options to be exercised.
(b) Non-Transferability of Options. Except as contemplated by
Section 5(c), the Options may be exercised only by the Grantee or, following his
death, by the Grantee's estate. Except as contemplated by Section 5(c), the
Option is not assignable or transferable, in whole or in part, and it may not,
directly or indirectly, be offered, transferred, sold, pledged, assigned,
alienated, hypothecated or otherwise disposed of or encumbered (including
without limitation by gift, operation of law or otherwise) other than by will or
by the laws of descent and distribution to the estate of the Grantee upon the
Grantee's death, provided that the deceased Grantee's beneficiary or the
representative of the Grantee's estate shall acknowledge and agree in writing,
in a form reasonably acceptable to Worldwide, to be bound by the provisions of
this Agreement and the Plan as if such beneficiary or the estate were the
Grantee.
(c) Purchase of Options on Termination of Employment.
(i) Termination of Employment. If the Grantee's employment with
Worldwide or any Subsidiary that employs the Grantee is terminated for any
reason other than for Cause, Worldwide shall have an option to purchase
all or any portion of the Covered Options and shall have 30 days from the
effective date of the Grantee's termination of employment (such 30-day
period being hereinafter referred to as the "First Purchase Period")
during which to give notice in writing
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to the Grantee (or, if the Grantee's employment was terminated by the
Grantee's death, the Grantee's estate) of its election to exercise or not
to exercise such right to purchase the Covered Options. Worldwide hereby
undertakes to use reasonable efforts to act as promptly as practicable
following such termination to make such election. If Worldwide (i) fails
to give notice that it intends to exercise its right to purchase the
Covered Options within the First Purchase Period or (ii) chooses to
purchase none or only a portion of the Covered Options, by giving such
notice, the CD&R Fund shall have the right to purchase all or any portion
of the Covered Options not purchased by Worldwide, and shall have until
the expiration of the earlier of (x) 30 days following the end of the
First Purchase Period or (y) 30 days from the date of receipt by the CD&R
Fund of written notice from Worldwide as to whether it intends to exercise
its right to purchase any of the Covered Options (such 30-day period being
hereinafter referred to as the "Second Purchase Period"), to give notice
in writing to the Grantee (or the Grantee's estate) of the CD&R Fund's
exercise of its right to purchase all or any portion of such Covered
Options. The Grantee (or the Grantee's estate) shall be entitled to retain
any Covered Options that are not purchased by Worldwide or the CD&R Fund
pursuant to this Section 5(c), subject to all of the provisions of this
Agreement (including, without limitation, Section 4(b)).
(ii) Purchase Price, etc. All purchases pursuant to this Section
5(c) by Worldwide or the CD&R Fund shall be for a purchase price and
effected in the manner prescribed by Sections 5(f), (g) and (h).
(d) Notice of Termination. Worldwide shall give written notice of
any termination of the Grantee's employment to the CD&R Fund, except that if
such termination (if other than as a result of death) is by the Grantee, the
Grantee shall give written notice of such termination to Worldwide and Worldwide
shall give written notice of such termination to the CD&R Fund.
(e) Public Offering. In the event that a Public Offering has been
consummated, neither Worldwide nor the CD&R Fund shall have any rights to
purchase the Covered Options pursuant to Section 5(c).
(f) Purchase Price. Subject to Section 10(c) hereof, the purchase
price to be paid to the Grantee (or the Grantee's estate) for the Covered
Options purchased pursuant to Section 5(c) (the "Purchase Price") shall be equal
to the excess, if any, of (i) the aggregate Fair Market Value, as of the
Determination Date, of the Shares then covered by those Covered Options being
purchased over (ii) the aggregate Option Price for such Shares.
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(g) Closing of Purchase; Payment of Purchase Price. Subject to
Section 10, the closing of a purchase of any Covered Options pursuant to this
Section 5 shall take place at the principal office of Worldwide on the tenth
business day following the receipt by the Grantee (or his estate) of Worldwide's
or the CD&R Fund's, as the case may be, notice of exercise of its right to
purchase any such Covered Options pursuant to Section 5(c). At the closing, (i)
subject to the proviso below, Worldwide or the CD&R Fund, as the case may be,
shall pay the Purchase Price to the Grantee (or his estate) for the Covered
Options being purchased by delivery of a check for such Purchase Price payable
to the order of the Grantee (or his estate) and (ii) the Grantee (or his estate)
shall deliver to Worldwide such instruments as Worldwide may reasonably request,
signed by the Grantee (or his estate), free and clear of all security interests,
liens, claims, encumbrances, charges, options, restrictions on transfer, proxies
and voting and other agreements of whatever nature; provided, however, that if
the Determination Date occurs during the first or last fiscal quarter of any
Fiscal Year, Worldwide or the CD&R Fund, as the case may be, may defer the
payment of a portion of the Purchase Price for the Covered Options being
purchased until the tenth business day following receipt by Worldwide of the
Applicable Share Valuation (such tenth business day, the "Deferred Payment
Date"). In the event of any such deferral, (i) at the closing of the purchase of
the Covered Options, Worldwide or the CD&R Fund, as the case may be, shall pay
to the Grantee (or his estate) an amount (the "First Installment Amount") equal
to 80% of the excess of (A) the aggregate Fair Market Value of the Shares then
covered by the Covered Options being purchased, determined on the basis of the
most recent available annual valuation of the Shares, over (B) the aggregate
Option Price for such Shares, and (ii) no later than the Deferred Payment Date,
Worldwide or the CD&R Fund, as the case may be, shall pay an additional amount
to the Grantee (or his estate) equal to the excess, if any, of (A) the sum of
(1) the Purchase Price for the Covered Options being purchased and (2) an amount
calculated by multiplying the First Installment Amount by a percentage equal to
the average annual cost to Worldwide and the Subsidiaries of their bank
indebtedness obligations outstanding during the period that payment of a portion
of the Purchase Price is delayed hereunder or, if there are no such obligations
outstanding, one percentage point greater than the average annual prime rate
charged during such period by Chase Bank or such other nationally recognized
bank designated by Worldwide, over (B) the First Installment Amount.
(h) Application of the Purchase Price to Certain Loans. The Grantee
agrees that Worldwide and the CD&R Fund shall be entitled to apply any amounts
to be paid by Worldwide or the CD&R Fund, as the case may be, to purchase the
Covered Options pursuant to this Section 5 to discharge any indebtedness of the
Grantee to Worldwide or any Subsidiary, or indebtedness that is guaranteed by
Worldwide or any Subsidiary, which indebtedness was incurred by the Grantee in
connection with his purchase of any shares of Common Stock.
12
<PAGE>
(i) Withholding. Whenever Shares are to be issued pursuant to the
Options, Worldwide may require the recipient of the Shares to remit to Worldwide
an amount in cash sufficient to satisfy any applicable U.S. federal, state and
local and non- U.S. tax withholding requirements as a condition to the issuance
of such Shares. In the event any cash is paid to the Grantee or the Grantee's
estate or beneficiary pursuant to this Section 5 or Section 9, Worldwide shall
have the right to withhold an amount from such payment sufficient to satisfy any
applicable U.S. federal, state and local and non-U.S. tax withholding
requirements. If shares of Common Stock are traded on a national securities
exchange or bid and ask prices for shares of Common Stock are quoted on the
NASDAQ, Worldwide may, if requested by the Grantee, withhold Shares to satisfy
the minimum applicable withholding requirements, subject to the provisions of
the Plan and any rules adopted by the Board regarding compliance with applicable
law, including, but not limited to, Section 16(b) of the Exchange Act.
6. Manner of Exercise. To the extent that any outstanding Options
shall have become and remain vested and exercisable as provided in Sections 3
and 4 and subject to such reasonable administrative regulations as the Board may
have adopted, such Options may be exercised, in whole or in part, by notice to
the Secretary of Worldwide in writing given at least 15 business days prior to
the date as of which the Grantee will so exercise the Options (the "Exercise
Date"), specifying the number of whole Shares with respect to which the Options
are being exercised (the "Exercise Shares") and the aggregate Option Price for
such Exercise Shares, provided that if shares of Common Stock are traded on a
U.S. national securities exchange or bid and ask prices for shares of Common
Stock are quoted over NASDAQ, notice may be given five business days before the
Exercise Date. On or before the Exercise Date, the Company and the Grantee shall
enter into a Management Stock Subscription Agreement which shall contain (unless
a Public Offering shall have occurred prior to the Exercise Date) provisions
corresponding to Section 5(c) hereof. In accordance with the Management Stock
Subscription Agreement, (a) on or before the Exercise Date, the Grantee shall
deliver to Worldwide full payment for the Exercise Shares in United States
dollars in cash, or cash equivalents satisfactory to Worldwide, and in an amount
equal to the product of the number of Exercise Shares, multiplied by the Option
Price (such product, the "Exercise Price") and (b) Worldwide shall deliver to
the Grantee a certificate or certificates representing the Exercise Shares,
registered in the name of the Grantee and bearing appropriate legends as
provided in Section 7(b) hereof. If, as of the Exercise Date, shares of Common
Stock are traded on a U.S. national securities exchange or bid and ask prices
for shares of Common Stock are quoted over NASDAQ, the Grantee may, in lieu of
tendering cash, tender shares of Common Stock that have been owned by the
Grantee for at least six months, having an aggregate Fair Market Value on the
Exercise Date equal to the Exercise Price or may deliver a combination of cash
and such shares of Common Stock having an aggregate Fair Market Value equal to
the difference between the Exercise Price and the amount of such cash as payment
of the Exercise Price, subject
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to such rules and regulations as may be adopted by the Board to provide for the
compliance of such payment procedure with applicable law, including Section
16(b) of the Exchange Act. Worldwide may require the Grantee to furnish or
execute such other documents as Worldwide shall reasonably deem necessary (i) to
evidence such exercise, (ii) to determine whether registration is then required
under the Securities Act and (iii) to comply with or satisfy the requirements of
the Securities Act, applicable state or non-U.S. securities laws or any other
law.
7. Grantee's Representations, Warranties and Covenants.
(a) Investment Intention. The Grantee represents and warrants that
the Options have been, and any Exercise Shares will be, acquired by the Grantee
solely for the Grantee's own account for investment and not with a view to or
for sale in connection with any distribution thereof. The Grantee agrees that
the Grantee will not, directly or indirectly, offer, transfer, sell, pledge,
hypothecate or otherwise dispose of all or any of the Options or any of the
Exercise Shares (or solicit any offers to buy, purchase or otherwise acquire or
take a pledge of all or any of the Options or any of the Exercise Shares),
except in compliance with the Securities Act and the rules and regulations of
the Commission thereunder, and in compliance with applicable state securities or
"blue sky" laws and non-U.S. securities laws. The Grantee further understands,
acknowledges and agrees that none of the Exercise Shares may be transferred,
sold, pledged, hypothecated or otherwise disposed of unless the provisions of
the related Management Stock Subscription Agreement shall have been complied
with or have expired.
(b) Legends. The Grantee acknowledges that any certificate
representing the Exercise Shares shall bear an appropriate legend, which will
include, without limitation, the following language:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
PROVISIONS OF A MANAGEMENT STOCK SUBSCRIPTION AGREEMENT, DATED AS OF
DECEMBER 22, 1999 AND NEITHER THIS CERTIFICATE NOR THE SHARES
REPRESENTED BY IT ARE ASSIGNABLE OR OTHERWISE TRANSFERABLE EXCEPT IN
ACCORDANCE WITH THE PROVISIONS OF SUCH MANAGEMENT STOCK SUBSCRIPTION
AGREEMENT, AS THE SAME MAY BE AMENDED FROM TIME TO TIME A COPY OF
THE CURRENT FORM OF WHICH IS ON FILE WITH THE SECRETARY OF
WORLDWIDE. THE SHARES REPRESENTED BY THIS CERTIFICATE ARE ENTITLED
TO CERTAIN OF
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THE BENEFITS OF AND ARE BOUND BY CERTAIN OF THE OBLIGATIONS SET
FORTH IN A REGISTRATION AND PARTICIPATION AGREEMENT, DATED AS OF
MARCH 30, 1998, AS AMENDED, AMONG WORLDWIDE AND CERTAIN STOCKHOLDERS
OF WORLDWIDE, AS THE SAME MAY BE AMENDED FROM TIME TO TIME, A COPY
OF THE CURRENT FORM OF WHICH IS ON FILE WITH THE SECRETARY OF
WORLDWIDE."
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR QUALIFIED UNDER ANY STATE OR NON-U.S.
SECURITIES LAWS AND MAY NOT BE TRANSFERRED, SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) (A) SUCH
DISPOSITION IS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, (B) THE HOLDER HEREOF SHALL
HAVE DELIVERED TO WORLDWIDE AN OPINION OF COUNSEL, WHICH OPINION AND
COUNSEL SHALL BE REASONABLY SATISFACTORY TO WORLDWIDE, TO THE EFFECT
THAT SUCH DISPOSITION IS EXEMPT FROM THE PROVISIONS OF SECTION 5 OF
SUCH ACT OR (C) A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE
COMMISSION, REASONABLY SATISFACTORY TO COUNSEL FOR WORLDWIDE, SHALL
HAVE BEEN OBTAINED WITH RESPECT TO SUCH DISPOSITION AND (ii) SUCH
DISPOSITION IS PURSUANT TO REGISTRATION UNDER ANY APPLICABLE STATE
AND NON-U.S. SECURITIES LAWS OR AN EXEMPTION THEREFROM."
[FOR UNITED KINGDOM RESIDENTS ONLY:
"THE SHARES OF OUR COMMON STOCK ARE NOT LISTED, QUOTED OR DEALT IN
ON ANY STOCK EXCHANGE AND NO APPLICATION HAS BEEN MADE TO ANY STOCK
EXCHANGE FOR LISTING OR FOR QUOTATION OF, OR FOR PERMISSION TO DEAL
IN, ANY SUCH SHARES."]
[FOR SINGAPORE RESIDENTS ONLY:
"NEITHER THE SHARES NOR THE SHARES THAT MAY BE PURCHASED ON THE
EXERCISE OF THE OPTIONS MAY BE
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OFFERED OR SOLD, NOR MAY ANY DOCUMENT OR OTHER MATERIAL IN
CONNECTION WITH THE SHARES OR SHARES THAT MAY BE PURCHASED ON THE
EXERCISE OF THE OPTIONS BE DISTRIBUTED, DIRECTLY OR INDIRECTLY, (I)
TO PERSONS IN SINGAPORE OTHER THAN IN CIRCUMSTANCES IN WHICH SUCH
OFFER OR SALE DOES NOT CONSTITUTE AN OFFER OR SALE OF THE SHARES OR
SHARES THAT MAY BE PURCHASED ON THE EXERCISE OF OPTIONS TO THE
PUBLIC IN SINGAPORE OR (II) TO THE PUBLIC OR ANY MEMBER OF THE
PUBLIC IN SINGAPORE OTHER THAN PURSUANT TO, AND IN ACCORDANCE WITH
THE CONDITIONS OF, AN EXEMPTION INVOKED UNDER DIVISION 5A OR PART IV
OF THE COMPANIES ACT, CHAPTER 50 OF SINGAPORE AND TO PERSONS TO WHOM
THE SHARES OR SHARES THAT MAY BE PURCHASED ON THE EXERCISE OF THE
OPTIONS MAY BE OFFERED OR SOLD UNDER SUCH EXCEPTION."]
(c) Securities Law Matters. The Grantee acknowledges receipt of
advice from Worldwide that (i) the Exercise Shares have not been registered
under the Securities Act or qualified under any state securities or "blue sky"
or non-U.S. securities laws, (ii) it is not anticipated that there will be any
public market for the Exercise Shares, (iii) the Exercise Shares must be held
indefinitely and the Grantee must continue to bear the economic risk of the
investment in the Exercise Shares unless the Exercise Shares are subsequently
registered under the Securities Act and such state laws or an exemption from
registration is available, (iv) Rule 144 is not presently available with respect
to sales of securities of Worldwide and Worldwide has made no covenant to the
Grantee to make Rule 144 available, (v) when and if the Exercise Shares may be
disposed of without registration in reliance upon Rule 144, such disposition can
be made only in limited amounts in accordance with the terms and conditions of
such Rule, (vi) Worldwide does not plan to file reports with the Commission or
make public information concerning Worldwide available unless required to do so
by law or the terms of its Financing Agreements (as hereinafter defined), (vii)
if the exemption afforded by Rule 144 is not available, sales of the Exercise
Shares may be difficult to effect because of the absence of public information
concerning Worldwide, (viii) a restrictive legend in the form heretofore set
forth shall be placed on the certificates representing the Exercise Shares and
(ix) a notation shall be made in the appropriate records of Worldwide indicating
that the Exercise Shares are subject to restrictions on transfer set forth in
this Agreement and, if Worldwide should in the future engage the services of a
stock transfer agent, appropriate stop-transfer restrictions will be issued to
such transfer agent with respect to the Exercise Shares.
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(d) Compliance with Rule 144. If any of the Exercise Shares are to
be disposed of in accordance with Rule 144, the Grantee shall transmit to
Worldwide an executed copy of Form 144 (if required by Rule 144) no later than
the time such form is required to be transmitted to the Commission for filing
and such other documentation as Worldwide may reasonably require to assure
compliance with Rule 144 in connection with such disposition.
(e) Ability to Bear Risk. The Grantee covenants that the Grantee
will not exercise all or any of the Options unless (i) the financial situation
of the Grantee is such that the Grantee can afford to bear the economic risk of
holding the Exercise Shares for an indefinite period and (ii) the Grantee can
afford to suffer the complete loss of the Grantee's investment in the Exercise
Shares.
(f) Registration; Restrictions on Sale upon Public Offering. The
Grantee acknowledges and agrees that in respect of any Exercise Shares purchased
upon exercise of all or any of the Options, the Grantee shall be entitled to the
rights and subject to the obligations created under the Registration and
Participation Agreement, dated as of March 30, 1998, among Worldwide and certain
stockholders of Worldwide, as the same may be amended, modified or supplemented
from time to time (the "Registration and Participation Agreement"), to the
extent set forth therein. The Grantee agrees that, in the event that Worldwide
files a registration statement under the Securities Act with respect to an
underwritten public offering of any shares of its capital stock, the Grantee
will not effect any public sale or distribution of any shares of the Common
Stock (other than as part of such public offering), including but not limited
to, pursuant to Rule 144 or Rule 144A under the Securities Act, during the 20
days prior to and the 180 days after the effective date of such registration
statement. The Grantee further understands and acknowledges that any sale,
transfer or other disposition of the Exercise Shares by him following a public
offering will be subject to compliance with, and may be limited under, the
federal securities laws and/or state "blue sky" and/or non-U.S. securities laws.
(g) Section 83(b) Election. The Grantee agrees that, within 20 days
of any Exercise Date that occurs prior to a Public Offering, the Grantee shall
give notice to Worldwide in the event the Grantee has made or intends to make an
election pursuant to Section 83(b) of the Internal Revenue Code of 1986, as
amended, with respect to the Exercise Shares purchased on such date, and
acknowledges that the Grantee will be solely responsible for any and all tax
liabilities payable by the Grantee in connection with the Grantee's exercise of
any Options or receipt of any Exercise Shares or attributable to the Grantee's
making or failing to make such an election.
8. Representations and Warranties of Worldwide. Worldwide represents
and warrants to the Grantee that (a) Worldwide has been duly incorporated and is
an existing corporation in good standing under the laws of the State of
Delaware,
17
<PAGE>
(b) this Agreement has been duly authorized, executed and delivered by Worldwide
and constitutes a valid and legally binding obligation of Worldwide enforceable
against Worldwide in accordance with its terms and (c) the Exercise Shares, when
issued, delivered and paid for, upon exercise of the Options in accordance with
the terms hereof and the Management Stock Subscription Agreement, will be duly
authorized, validly issued, fully paid and nonassessable, and free and clear of
any liens or encumbrances other than those created pursuant to this Agreement,
the Management Stock Subscription Agreement or otherwise in connection with the
transactions contemplated hereby.
9. Change in Control.
(a) Service Options and Vested Performance Options. Subject to
Section 9(d), in the event of a Change in Control, all of the Included Options
(as defined in Section 9(b) below) shall be canceled in exchange for a payment
in accordance with Section 9(c) of an amount equal to the excess, if any, of (i)
the product of the Change in Control Price multiplied by the aggregate number of
Shares covered by all such Included Options immediately prior to the Change in
Control, (ii) over the aggregate Option Price for all such Shares. Performance
Options that are not Included Options, if any, shall automatically terminate and
be canceled upon the consummation of the transaction constituting the Change in
Control.
(b) Definition of Included Options. The term "Included Options"
shall mean, collectively, (i) each Service Option outstanding immediately prior
to the consummation of the transaction constituting the Change in Control
(regardless of whether such Service Option is at such time otherwise vested or
exercisable), (ii) each Performance Option outstanding immediately prior to the
consummation of the transaction constituting the Change in Control that shall
have become vested in accordance with Section 3(b) hereof prior to such time, if
any, and (iii) if any Performance Options have not become vested in accordance
with Section 3(b) prior to the date of the consummation of the transaction
constituting the Change in Control, the number of Performance Options equal to
the product of (x) the Applicable Percentage multiplied by (y) the total number
of Performance Options granted hereunder, such Applicable Percentage to be
determined as of the last day of the fiscal quarter of Worldwide ending
immediately prior to such date.
(c) Timing of Option Cancelation Payments; Discretionary
Acceleration. Notwithstanding the provisions of the preceding paragraphs (a) and
(b), the Board (as constituted immediately prior to the consummation of the
transaction constituting the Change in Control) may determine, in its
discretion, to accelerate the exercisability or cause the cancellation and
payment of an amount calculated as provided in Section 9(a) in respect of all or
any additional portion of the Performance Options.
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<PAGE>
Payment of the amount calculated in accordance with Section 9(a)
shall be made in cash or, if determined by the Board (as constituted immediately
prior to the Change in Control), in shares of the common stock of the New
Employer having an aggregate fair market value equal to such amount and shall be
payable in full, as soon as reasonably practicable, but in no event later than
30 days, following the Change in Control. For purposes hereof, the fair market
value of a share of common stock of the New Employer shall be determined by the
Board (as constituted immediately prior to the consummation of the transaction
constituting the Change in Control), in good faith, on the basis of the factors
described in the definition of the term "fair market value" contained in Section
1(y), other than an Applicable Share Valuation, as applied to the business,
operations and financial results of the New Employer and its subsidiaries and
applicable affiliates.
(d) Alternative Options. Notwithstanding Sections 9(a), 9(b) and
9(c), no cancellation, termination, acceleration of exercisability or vesting or
settlement or other payment shall occur with respect to any Option, including
any Included Option, if the Board (as constituted immediately prior to the
consummation of the transaction constituting the Change in Control) reasonably
determines, in good faith, prior to the Change in Control that the Options shall
be honored or assumed, or new rights substituted therefor (such honored, assumed
or substituted Option being hereinafter referred to as an "Alternative Option")
by the New Employer, provided that any Alternative Options must:
(i) provide the Grantee with rights and entitlements substantially
equivalent to or better than the rights and entitlements applicable
under the terms of the Options immediately prior to the consummation
of the transaction constituting the Change in Control, including,
but not limited to, an identical or better exercise and vesting
schedule and identical or better timing and methods of exercise or
payment;
(ii) have substantially equivalent economic value to the Options
(determined at the time of the Change in Control); and
(iii) have terms and conditions which provide that in the event that
the Grantee suffers an Involuntary Termination within two years
following a Change in Control:
(x) any conditions on the Grantee's rights under, or any
restrictions on transfer or exercisability applicable to, each
such Alternative Option shall be waived or shall lapse, as the
case may be; or
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<PAGE>
(y) the Grantee shall have the right to surrender such
Alternative Option within 30 days following such termination
in exchange for a payment in cash equal to the excess of the
fair market value of the common stock subject to the
Alternative Option over the price, if any, that the Grantee
would be required to pay to exercise such Alternative Option.
10. Certain Restrictions on Repurchases
(a) Financing Agreements, etc. Notwithstanding any other provision
of this Agreement, Worldwide shall not be obligated or permitted to pay the
purchase price for any Covered Options that Worldwide may elect to purchase from
the Grantee pursuant to Section 5(c) if (i) the payment of such purchase price
(or the payment of a dividend by a Subsidiary to Worldwide to fund such
repurchase) would result in a violation of the terms or provisions of, or result
in a default or an event of default under, any of (A) the Credit Agreement,
dated as of November 19, 1999 and amended as of November 23, 1999, among NAVL,
the Foreign Subsidiary Borrowers from time to time party thereto, the several
banks and financial institutions from time to time party thereto, The Bank of
New York, as documentation agent, Banc of America Securities LLC, as syndication
agent, and The Chase Manhattan Bank, as administrative agent, (B) the Indenture,
dated November 19, 1999, among NAVL, certain subsidiaries of NAVL, as
guarantors, and State Street Bank and Trust Company, as trustee, or (C) any
other guarantee, financing or security agreement or document entered into (1) by
Worldwide or any Subsidiary that remains outstanding in any part on or after the
date hereof, (2) from time to time in connection with the operations of
Worldwide or the Subsidiaries or (3) to refinance or replace any indebtedness
described in this Section 10(a) (the Credit Agreement, the Indenture and such
other agreements and documents, as each may be amended, modified or supplemented
from time to time, are referred to herein as the "Financing Agreements"), in
each case as the same may be amended, modified or supplemented from time to
time, (ii) the payment of such purchase price would violate any of the terms or
provisions of the Certificate of Incorporation of Worldwide or (iii) Worldwide
has no funds legally available therefor under the General Corporation Law of the
State of Delaware.
(b) Delay of Purchase. In the event that the payment of the purchase
price for any Covered Options by Worldwide otherwise permitted under Section
5(c) is prevented solely by the terms of Section 10(a), (i) the payment of such
purchase price will be postponed and will be made without the application of
further conditions or impediments (other than as set forth in Section 5 hereof
or in this Section 10) at the first opportunity thereafter when Worldwide has
funds legally available therefor and when the payment of such purchase price
will not result in any default, event of default or violation under any of the
Financing Agreements or in a violation of any term or provision of the
20
<PAGE>
Certificate of Incorporation of Worldwide and (ii) the Grantee's right to
receive payment of such purchase price shall rank against other similar rights
with respect to shares of Common Stock or options in respect thereof according
to priority in time of the effective date of the event giving rise to any such
right, provided that any such right as to which a common date determines
priority shall be of equal priority and shall share pro rata in any purchase
payments made pursuant to clause (i) above.
(c) Purchase Price Adjustment. In the event that the payment of the
purchase price for any Covered Options purchased from the Grantee is delayed
pursuant to this Section 10, the purchase price for such Covered Options when
the purchase price is eventually paid as contemplated by Section 10(b) shall be
the sum of (a) the Purchase Price of such Covered Options, as determined in
accordance with Section 5(f) at the time that the Purchase Price would have been
paid but for the operation of this Section 10, plus (b) an amount equal to
interest on such Purchase Price for the period from the date on which the
Purchase Price would have been paid but for the operation of this Section 10 to
the date on which such Purchase Price is actually paid (the "Delay Period"), at
an annual rate of interest equal to the average annual cost to Worldwide and the
Subsidiaries of their bank indebtedness obligations outstanding during the
period that payment of a portion of the Purchase Price is delayed hereunder or,
if there are no such obligations outstanding, one percentage point greater than
the average annual prime rate charged during such period by Chase Bank or such
other nationally recognized bank designated by Worldwide.
11. No Rights as Stockholder. The Grantee shall have no voting or
other rights as a stockholder of Worldwide with respect to any Shares covered by
the Options until the exercise of the Options and the issuance of a certificate
or certificates to the Grantee for such Shares. No adjustment shall be made for
dividends or other rights for which the record date is prior to the issuance of
such certificate or certificates.
12. Capital Adjustments. The number and price of the Shares covered
by the Options shall be proportionately adjusted to reflect any stock dividend,
stock split or share combination of the Common Stock or any recapitalization of
Worldwide. Subject to any required action by the stockholders of Worldwide and
Section 9 hereof, in any merger, consolidation, reorganization, exchange of
shares, liquidation or dissolution, the Options shall pertain to the securities
and other property, if any, that a holder of the number of shares of Common
Stock covered by the Options would have been entitled to receive in connection
with such event.
21
<PAGE>
13. Miscellaneous.
(a) Notices. All notices and other communications required or
permitted to be given under this Agreement shall be in writing and shall be
deemed to have been given if delivered personally or sent by certified or
express mail, return receipt requested, postage prepaid, or by any recognized
international equivalent of such delivery, to Worldwide, the CD&R Fund or the
Grantee, as the case may be, at the following addresses or to such other address
as Worldwide, the CD&R Fund or the Grantee, as the case may be, shall specify by
notice to the others:
(i) if to Worldwide, to it at:
c/o North American Van Lines, Inc.
Law Department
5501 U.S. Highway 30 West
Fort Wayne, Indiana 46801
Attention: General Counsel
(ii) if to the Grantee, to the Grantee at the address set forth on
the signature page hereof.
(iii) if to the CD&R Fund, to:
Clayton, Dubilier & Rice Fund V Limited Partnership
1403 Foulk Road, Suite 106
Wilmington, Delaware 19803
Attention: Joseph L. Rice, III
All such notices and communications shall be deemed to have been received on the
date of delivery if delivered personally or on the third business day after the
mailing thereof, provided that the party giving such notice or communication
shall have attempted to telephone the party or parties to which notice is being
given during regular business hours on or before the day such notice or
communication is being sent, to advise such party or parties that such notice is
being sent. Copies of any notice or other communication given under this
Agreement shall also be given to:
Clayton, Dubilier & Rice, Inc.
375 Park Avenue, 18th Floor
New York, New York 10152
Attention: Kevin J. Conway
22
<PAGE>
and
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Attention: Paul S. Bird, Esq.
The CD&R Fund also shall be given a copy of any notice or other communication
between the Grantee and Worldwide under this Agreement at its address as set
forth above.
(b) Binding Effect; Benefits. This Agreement shall be binding upon
and inure to the benefit of the parties to this Agreement and their respective
successors and assigns. Except as provided in Section 5, nothing in this
Agreement, express or implied, is intended or shall be construed to give any
person other than the parties to this Agreement or their respective successors
or assigns any legal or equitable right, remedy or claim under or in respect of
any agreement or any provision contained herein.
(c) Waiver; Amendment.
(i) Waiver. Any party hereto or beneficiary hereof may by written
notice to the other parties (A) extend the time for the performance of any
of the obligations or other actions of the other parties under this
Agreement, (B) waive compliance with any of the conditions or covenants of
the other parties contained in this Agreement and (C) waive or modify
performance of any of the obligations of the other parties under this
Agreement, provided that any waiver of the provisions of Section 5 must be
consented to in writing by the CD&R Fund. Except as provided in the
preceding sentence, no action taken pursuant to this Agreement, including,
without limitation, any investigation by or on behalf of any party or
beneficiary, shall be deemed to constitute a waiver by the party or
beneficiary taking such action of compliance with any representations,
warranties, covenants or agreements contained herein. The waiver by any
party hereto or beneficiary hereof of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any preceding
or succeeding breach and no failure by a party or beneficiary to exercise
any right or privilege hereunder shall be deemed a waiver of such party's
or beneficiary's rights or privileges hereunder or shall be deemed a
waiver of such party's or beneficiary's rights to exercise the same at any
subsequent time or times hereunder.
(ii) Amendment. This Agreement may not be amended, modified or
supplemented orally, but only by a written instrument executed by the
Grantee and Worldwide, and (in the case of any amendment, modification or
supplement
23
<PAGE>
that adversely affects the rights of the CD&R Fund hereunder) consented to
by the CD&R Fund in writing. The parties hereto acknowledge that
Worldwide's consent to an amendment or modification of this Agreement may
be subject to the terms and provisions of the Financing Agreements.
(d) Assignability. Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by Worldwide or the Grantee without the prior written consent of the
other parties and the CD&R Fund. The CD&R Fund may assign from time to time all
or any portion of its rights under Section 5 to one or more persons or other
entities designated by it.
(e) Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, EXCEPT TO THE
EXTENT THAT THE CORPORATE LAW OF THE STATE OF DELAWARE SPECIFICALLY AND
MANDATORILY APPLIES.
(f) Section and Other Headings, etc. The section and other headings
contained in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
(g) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.
(h) Delegation by the Board. All of the powers, duties and
responsibilities of the Board specified in this Agreement may, to the full
extent permitted by applicable law, be exercised and performed by any duly
constituted committee thereof to the extent authorized by the Board to exercise
and perform such powers, duties and responsibilities.
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<PAGE>
IN WITNESS WHEREOF, Worldwide and the Grantee have executed this
Agreement as of the date first above written.
ALLIED WORLDWIDE, INC.
By:______________________________________
Name:
Title:
THE GRANTEE:
Name
By:______________________________________
as Attorney-in-Fact
Name:
Address of the Grantee:
Address
Service Options Performance Options
--------------- -------------------
Total Number of Shares for Shares Shares
the Purchase of Which
Options have been Granted
<PAGE>
Exhibit 10.15
Conformed Copy
==============================
TRANSITION SERVICES AGREEMENT
between
NFC PLC
and
NA HOLDING CORPORATION
===============
Dated as of November 19, 1999
===============
==============================
<PAGE>
TRANSITION SERVICES AGREEMENT
This TRANSITION SERVICES AGREEMENT (together with all schedules
hereto, this "Agreement") dated as of November 19, 1999 between NA Holding
Corporation, a Delaware corporation (the "Buyer") and NFC PLC, a company
organized under the laws of England and Wales ("NFC").
W I T N E S E T H:
WHEREAS, pursuant to the terms of the Acquisition Agreement, dated
as of September 14, 1999, between Buyer and NFC (the "Acquisition Agreement"),
as of the date hereof (i) NFC and certain subsidiaries of NFC have sold all of
the issued and outstanding stock of the Allied Van Lines, Inc. and the other
Target Subsidiaries listed on Annex B to the Acquisition Agreement to the Buying
Group; (ii) Pickfords Ltd. has issued a certain number of shares in its capital
to the Buying Group; and (iii) NFC Canada Ltd., a company organized under the
laws of Canada has sold all of the assets used or held for use in connection
with the Moving Business as conducted in Canada to the Buying Group (capitalized
terms used herein without definition shall have the meanings set forth in the
Acquisition Agreement);
WHEREAS, the Acquisition Agreement provides that NFC shall enter
into a transition services agreement with the Buyer pursuant to which NFC and
certain of its Affiliates (each, a "Service Provider" and collectively, the
"Service Providers") will provide certain services to the Company Group upon the
terms hereof; and
WHEREAS, the parties desire hereby to set forth the terms and
conditions upon which the Service Providers will provide the services described
on Schedule A hereto (the "Services") to the Company Group following the Closing
for a limited period of time;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, and for other good and valuable
consideration the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
SECTION 1
PROVISION OF SERVICES
1.1. Provision of Services. (a) In accordance with the terms and
provisions of this Agreement, NFC shall provide, and shall cause its Affiliates
to provide, the Services to the Company Group upon the terms set out in Schedule
A, until the expiration date set forth on Schedule A for each such Service (the
"Expiration Date") for
<PAGE>
the monthly fee as set forth for such Service on Schedule A, as Schedule A may
be amended from time to time in accordance with the procedures set forth in
Section 3.2 hereof.
(b) Services shall be provided in the manner and at a level of
quality and performance consistent with past practice during the 12-month period
preceding the date hereof, and NFC shall be under no obligation to perform the
Services at any higher level of quality and performance. In providing the
Services hereunder, NFC may use such personnel of NFC or its Affiliates as NFC
deems necessary or appropriate, or may employ the services of third parties to
the extent such third party services are routinely utilized to provide such
services to NFC or are reasonably necessary to the efficient performance of any
such Services, provided that such third party services shall be of substantially
similar quality to Services provided during the 12-month period preceding the
date hereof. NFC shall use its commercially reasonable best efforts to obtain
all third party consents, waivers and approvals required to provide any Service
pursuant to this Agreement (other than in respect of the use of the HYPERION
software with respect to which the provisions of clause (c) of this Section 1.1
shall govern). To the extent that the Buyer requires any additional licenses to
receive any Service in relation to software, hardware or other equipment
(including, without limitation, telecommunications equipment) used to provide
such Service the Buyer shall cooperate and give reasonable assistance to NFC in
obtaining such additional licenses or in the alternative to obtain extensions to
appropriate third party licenses held by NFC or its Affiliates. The cost of
obtaining any such consents, approvals or licenses shall (unless such licenses
are required as a result of an increase in the number of users) be borne in the
following manner: NFC shall bear the first (pound)50,000 in aggregate of costs;
thereafter, all costs shall be borne equally by NFC and the Buyer. The Buyer
acknowledges and agrees that to the extent the number of users using the
Services is higher than the number of users using such Services prior to the
Closing Date, the Buyer alone shall bear the costs of license fees in respect of
such additional users. To the extent that such additional licenses, consents or
permissions are not so obtained, the Buyer and NFC shall cooperate to determine
an alternative to the Services and shall bear the costs of such alternative
services equally.
(c) In respect of the use by the Company Group of the HYPERION
software used by NFC (the "HYPERION Software"), the Buyer and NFC agree that
neither party shall make contact with or enter into discussions or negotiations
with the owners of the HYPERION Software without consulting with the other
party. NFC agrees that it shall or shall procure that its Affiliates give all
reasonable assistance to the Buyer and its Affiliates for the purpose of
obtaining any consent, waiver or approval for the use of the HYPERION Software
and/or to secure the provision of the Service(s) utilizing the HYPERION
Software, including without limitation making appropriate representatives of the
Buyer or the Company Group available to meet with the owners of the HYPERION
Software and to attend demonstrations by said owners.
2
<PAGE>
(d) For purposes of this Agreement, "Affiliate" shall mean, with
respect to any person, (I) any person that directly or indirectly controls, is
controlled by or under common control with, such person, or (ii) any director,
officer, partner, member or employee of such person.
1.2. Access. The Company Group or its Affiliates shall, upon
reasonable prior notice, give such reasonable access during normal business
hours at such premises as NFC or any Service Provider or any of its or their
representatives reasonably require and shall make available on a timely basis to
the relevant Service Provider all information and materials reasonably requested
by it or any of them to enable it or them to provide the Services. The Buyer
agrees to procure that Pickfords Limited shall grant NFC and its employees,
representatives and agents a licence to enter onto the premises at Enfield and
to use the fueling facilities there for the purpose of re-fueling vehicles and
for fulfilling its obligations to maintain the said facilities, such licence to
remain until the Expiration Date in respect of the Services with respect to Fuel
set forth on Schedule A.
1.3. Buyer Obligations. The Company Group shall (i) use reasonable
efforts to cooperate with, assist and provide information to each of the Service
Providers to enable such Service Providers to perform the Services, (ii) comply
with the terms of and obligations under licenses, permits, consents or other
agreements held by NFC or any of its Affiliates or to which NFC or any of its
Affiliates is a party which are used in the provision of the Services, to the
extent that NFC or such Service Provider has informed the Company Group of such
terms and obligations, and (iii) take or maintain appropriate steps to ensure
the integrity of the Service Providers' business systems when using or receiving
Services, including, without limitation, taking appropriate steps to guard
against computer viruses or "logic bombs" being introduced by the Company Group.
1.4. Maintenance of Records. NFC shall make available for inspection
by the Buying Group and the Company Group or their representatives and agents,
during regular business hours and upon reasonable notice, records that (a) the
Service Providers have prepared or maintained in providing the Services or (b)
the Buying Group or the Company Group has reasonably requested that the Service
Providers prepare or maintain; provided, however, that any such inspection by
the Buying Group or the Company Group or their representatives or agents shall
be conducted in a manner which does not unreasonably interfere with the
operation of the day-to-day business affairs of such Service Provider. The
Company Group shall pay the costs of any such inspection.
1.5. Priorities. In providing Services, each Service Provider shall
accord the Company Group's work on the Services substantially the same priority
as it accords its own operations.
3
<PAGE>
1.6. Omitted Services. To the extent that any material service was
provided during the three months Prior to Closing to the Company Group by a
Service Provider or other Affiliate of NFC is not included on Schedule A to this
Agreement as of the date hereof was not disclosed by NFC to the Buyer prior to
the date hereof but is identified by the Buyer after the Closing (an "Omitted
Service") and the Buyer reasonably believes that the provision of such Omitted
Service is reasonably required by the Company Group, the parties agree that such
Omitted Service shall, upon written notice from Buyer to NFC, be added to the
Services, and Schedule A shall be amended to include such Omitted Service, and
the appropriate Service Provider or other Affiliate of NFC shall begin rendering
such Omitted Service as soon as possible but in any event within the shorter of
three business days or five calendar days from the receipt of such notice. The
cost of providing such Omitted Service shall be the actual amount invoiced to
NFC in respect of the service provided to the relevant member of the Company
Group or the avoidable cash costs (i.e., the cash costs the Service Provider
would not have incurred if it were not providing the Omitted Service), which
shall be set forth on Schedule A, as amended. The Expiration Date in respect of
such Omitted Service shall be a date not later than six months after Closing and
shall be specified by the Buyer in the notice. Notwithstanding Section 7.12
hereof, the parties agree that any amendment to Schedule A hereto to add an
Omitted Service shall not require a separate signed agreement of the parties but
the form of notice shall include a revised Schedule A indicating the revision
and such revised Schedule A shall be deemed to be part of this Agreement from
and after the date thereof.
1.7. System Migration. Taking into account the need to minimize both
the cost of such transition and the disruption to the ongoing business
activities of the parties hereto, the Buyer shall use all commercially
reasonable efforts to replace the Services with non-NFC systems as soon as is
reasonably practicable and in any event (except with respect to Services for
which the parties have agreed to extend the term pursuant to Section 3.2) prior
to the Expiration Dates for such Services, and NFC shall give the Buyer and the
Company Group all reasonable assistance in connection with such migration. The
parties hereto acknowledge that the foregoing may include the provision of
services reasonably requested by the Buying Group or the Company Group in
connection with the transition of the Company Group to non-NFC systems,
including but not limited to migration of historical data, migration-specific
enhancements and cooperation with and assistance to third party consultants
engaged by the Buying Group or the Company Group in connection with the
foregoing.
1.8. Use of Services. Unless otherwise agreed in writing, the
Company Group (i) shall not make materially greater use of the Services, on an
average basis, than was made of the Services as they were provided to the
Company Group, on an average basis, during the 12-month period preceding the
date hereof, and (ii) with respect to any Services the provision of which
requires the licensing of third party software, hardware,
4
<PAGE>
services or equipment on a per-user basis, the Company Group agrees that it will
not allow a greater number of users to use the Services than used the Services
as they were provided during the 12-month period preceding the date hereof. If
the parties hereto shall agree in writing that the Company Group shall be
permitted to make such greater use or allow such greater number of users, the
Company Group shall pay such costs in connection therewith as shall be agreed by
the parties in writing.
1.9. System Changes. Upon consent of the Buyer, such consent not to
be unreasonably withheld or delayed, NFC shall have the right to make such
changes and modifications to the Services and the systems used to provide the
Services or any part thereof as in NFC's reasonable discretion is necessary or
desirable, provided that no such change or modification shall result in a
material degradation in any Services. The parties hereby agree that no such
modifications to the Services or the systems used to provide the Services shall
result in any additional cost to the Buyer unless the Buyer shall have
specifically agreed in writing to pay such additional costs.
1.10. No Warranty. The Buyer hereby acknowledges that, to the extent
that the Services have been provided in accordance with the provisions of clause
1.1, no warranty is given by NFC in respect of the fitness or suitability of any
Service for any purpose whatsoever.
5
<PAGE>
SECTION 2
PAYMENT
2.1. Invoicing and Payment. The Buyer shall cause the relevant
members of the Company Group to pay NFC, on behalf of all Service Providers or
as NFC shall otherwise direct, for the Services rendered by any Service Provider
during the preceding month within 30 days after receipt of an invoice from NFC
for such Services, subject to receiving any appropriate support documentation
for such invoice if reasonably requested by the Buyer, in accordance with the
payment instructions specified therein or, if no instructions are so specified,
in accordance with the standing payment instructions in effect from time to time
between NFC and the relevant member of the Company Group.
2.2. Expenses. The Buyer agrees to cause the relevant members of the
Company Group to reimburse NFC within 30 days after receipt of an invoice from
NFC, on behalf of all Service Providers or as NFC shall otherwise direct, for
such reasonable out-of-pocket expenses as may be incurred by any Service
Provider (and, for each expense exceeding (pound)500, approved in advance in
writing by the Buyer, such approval not to be unreasonably withheld or delayed)
in the course or on account of rendering of any of the Services hereunder. For
all expenses, NFC shall provide written documentation of the amount and nature
of such expenses.
2.3. Taxes. All charges and expenses specified in this Agreement are
expressed exclusive of any valued added tax, sales tax, goods and services tax
or similar tax thereon but if applicable any such tax shall be charged at the
then prevailing rate and the amount of any such tax will be separately stated on
each invoice raised.
2.4. Fees Payable upon Termination. Upon termination of any Service
pursuant to a notice from the Buyer or NFC, as the case may be, pursuant to
Section 3.1, the monthly fee associated with such terminated Service shall be
reduced accordingly and any obligation to pay fees relating to such terminated
Service in subsequent months shall cease.
2.5. Interest. If the Buyer fails to pay any of the charges
(including expenses) for the Services when due, NFC shall be entitled to charge
interest on the sum due (before and after any judgment) at the rate of 1% above
the base rate in force from time to time of Midland Bank PLC, such interest to
be calculated on a daily basis from the date upon which the sum became due.
6
<PAGE>
SECTION 3
TERM OF PARTICULAR SERVICES
3.1. Term of Services. Subject to Section 6, the provision of
Services shall commence on the date hereof and, with respect to each Service,
shall terminate on the Expiration Date set forth on Schedule A for such Service,
unless such Expiration Date has been extended pursuant to Section 3.2, provided,
that the Buyer may terminate any Service, in whole or in part, upon not less
than 30 days' written notice to NFC specifying the date of termination. A
Service Provider may not cease to provide a Service (including any additional
service agreed to in accordance with Section 3.2) hereunder prior to the
Expiration Date for such Service, other than pursuant to and on the termination
date specified in a notice from the Buyer pursuant to Section 3.1. In the event
that the term of any Service is extended in accordance with Section 3.2, NFC
shall have the right to terminate the provision of such Service in the event
that NFC ceases to use such Service in its own operations or provide such
Service to its Affiliates, upon 30 days' written notice to the Buyer specifying
the Service (or part thereof) to be terminated and the date of termination;
provided, however, that if NFC or its Affiliates make any arrangements with any
third party for the provision of services equivalent to the Services terminated
by NFC pursuant to this sentence, NFC shall use its commercially reasonable
efforts to obtain an offer from such third party to the relevant member of the
Company Group to provide such services upon terms and conditions that are
substantially the same as the terms and conditions under which the equivalent
Service was provided. A terminated Service shall cease to be provided on the
termination date indicated in the notice from the Buyer or NFC, as the case may
be.
3.2. Extension of Services. Should the Buyer desire to extend the
term of any Service (or part thereof) beyond its Expiration Date,
representatives of the Buyer and NFC shall meet within 30 days after receipt of
notice by NFC of a request to extend Services to discuss whether NFC is willing
to provide such extension and, if so, the terms and conditions (including cost)
upon which such extension will be provided but nothing in this Agreement shall
oblige NFC or any of its Affiliates to provide any such extension. Any such
extensions of the term of Services and their cost shall be effective as of the
date of execution of an amendment to Schedule A by duly authorized
representatives of NFC and the Buyer.
3.3. Return of Materials. Upon the termination of a Service or
Services with respect to which a Service Provider holds books, records, files,
databases or computer software or hardware (including, but not limited to,
current and archived copies of computer files) ("Materials") owned or leased by
the Company Group and used by a Service Provider in connection with the
provision of a Service or the Company Group holds Materials owned or leased by
the Service Provider or NFC and used by the Company Group in connection with the
provision of a Service, such Service Provider or
7
<PAGE>
the Company Group, as the case may be, will return all of such Materials
promptly upon termination, but not later than 30 days after such termination. In
the case of computer files or data, such Materials shall be delivered to the
Service Provider or Company Group, as the case may be, in a format which can be
read by the existing computer systems of entity receiving such Materials.
SECTION 4
FORCE MAJEURE
4.1. Force Majeure. No liability shall result from any delay or
failure in performance by either party resulting from any cause, condition or
event beyond the reasonable control of the party affected, including but not
limited to Acts of God, fire, flood, war, government action, accident, labor
trouble or shortage, or inability to obtain material, utilities, equipment,
energy or transportation (each a "Force Majeure Event"). Either party claiming
the benefit of this Section 4.1 shall promptly notify the other party in writing
upon learning of the occurrence of any Force Majeure Event and upon such notice
the affected provisions and/or other requirements of this Agreement shall be
suspended or reduced by an amount consistent with reductions made to the other
operations of such party during the period of such disability. Upon the
cessation of such Force Majeure Event, NFC will use its commercially reasonable
efforts to resume its performance of the Services hereunder within 30 days of
giving notice of such Force Majeure Event. If the Force Majeure Event continues
to have effect for a period of more than 30 days, the party not claiming relief
under this section shall have the right to terminate this Agreement immediately
upon written notice of such termination to the other party.
SECTION 5
DILIGENCE
5.1. Diligence. (a) Each of the Service Providers shall use
reasonable, good faith efforts, diligence and care in providing the Services
(NFC, for itself and its Affiliates having the intent to use that degree of
effort, diligence and care that it would exercise in similar circumstances in
carrying out its own business) and, in the absence of gross negligence,
recklessness or willful misconduct on the part of a Service Provider, such
Service Provider shall have no liability in providing Services to the Company
Group for any injury, loss or damage of any nature whatsoever.
(b) In performing its obligations under this Agreement, the Buyer
shall use reasonable, good faith efforts, diligence and care (the Buyer, for
itself and its Affiliates, having the intent to use that degree of effort,
diligence and care that it would exercise in similar circumstances in carrying
out its own business) and, in the absence of gross negligence, recklessness or
willful misconduct on the part of the Buying Group or the
8
<PAGE>
Company Group, the Buyer shall have no liability to any Service Provider for any
injury loss or damage of any nature whatsoever.
5.2. Obligation to Correct or Reperform. In the event of any breach
of this Agreement by a Service Provider with respect to any error or defect in
the provision of any Service, NFC shall, at the request of the relevant member
of the Company Group, use its best efforts to correct or cause to be corrected
such error or defect or reperform or cause to be reperformed such Services
without the payment of any further fees for the relevant Service by the Company
Group.
SECTION 6
TERMINATION
6.1. Termination. This Agreement shall terminate on the earlier to
occur of (a) the last Expiration Date relating to any Service provided hereunder
including any extension or additional service agreed upon in accordance with
Section 3.2 or (b) the date on which the provision of all Services have been
terminated pursuant to Section 3.1.
6.2. Effect of Termination. Sections 3.3, 5, 7.1 and 7.10 of this
Agreement and this Section 6.2 shall survive any termination of this Agreement.
SECTION 7
MISCELLANEOUS
7.1. Title to Data; Confidentiality. (a) Both parties agree not to
disclose to others or use in any way except to further the purposes of this
Agreement, without the written consent of the other, any information, documents
or know-how which either receives from, or in respect of, the other in
connection with this Agreement or which it obtains from the other by reason of
the provision of the Services.
(b) This obligation of confidentiality shall not apply to or (as the
case may be) shall cease to apply to information that: (i) was generally known
to the public prior to the date it was disclosed, or becomes generally known to
the public subsequent to such disclosure through no fault of the receiving
party, (ii) was properly received by the receiving party after the date hereof
free of any obligation of confidentiality, (iii) was received subsequent to the
disclosure hereunder from a third party who had a lawful right to disclose such
information, (iv) was communicated to a third party by the disclosing party free
of any obligation of confidentiality or non-disclosure subsequent to the time of
the disclosure to the receiving party, (v) was required to be disclosed by law
or the rules of the London Stock Exchange Limited or any governmental order,
provided that the party required to make such disclosure shall, so far as is
reasonably practicable to do so,
9
<PAGE>
provide prior written notice of such proposed disclosure to the other party, or
(vi) was independently developed by the receiving party.
7.2. Title to Intellectual Property. The parties hereto agree that
any Intellectual Property provided to a Service Provider by the Buying Group or
the Company Group, and any derivative works, additions, modifications or
enhancements thereof created by the other pursuant to this Agreement, are and
shall remain the sole property of the member of the Buying Group or the Company
Group owning such Intellectual Property. To the extent which data which is
created in the course of the provision of the Services relates to the Moving
Business, such data shall be the property of the Buyer, and all other data shall
be the property of NFC. The Buyer acknowledges that as between the parties, all
intellectual property rights in equipment (including any computers or associated
peripherals) and software used in the provision of the Services (other than that
owned or licensed by the Buyer) remain with NFC.
7.3. Independent Contractor. Each of NFC and its Affiliates, on the
one hand, and the Buying Group and the Company Group, on the other hand, is an
independent contractor and, during the term hereof, the relationship between
such parties is that of vendor and vendee. Neither of such parties (nor its
agents or employees) shall under any circumstances be deemed agents, partners,
joint venturers or representatives of the other. Neither of such parties shall
have the right to bind the other party in any respect except as expressly
provided herein.
7.4. Dispute Resolution. All disputes not resolved at a local level
between the parties out of or relating to this agreement shall be promptly
referred, by either party, to Roger Mann (in respect of NFC) and Jeffrey Kaczka
(in respect of the Buyer) for resolution who will, where necessary, negotiate in
good faith to resolve such disputes. Use of this dispute resolution procedure
shall not constitute a waiver of any right of either party. Performance under
this agreement shall not cease or be delayed by virtue of the dispute resolution
procedure hereunder.
7.5. Notices. All notices, requests, instructions, approvals and
other communications pursuant to this Agreement shall be given by hand delivery,
facsimile transmission, registered or certified United States mail or by a
nationally recognized overnight courier addressed:
10
<PAGE>
(a) If to Buyer, to:
NA Holding Corporation.
5001 U.S. Highway 30 West
Fort Wayne, IN 46801
Attention: General Counsel
Telecopy: (219) 429-3135
With copies to:
Clayton, Dubilier & Rice, Inc.
375 Park Avenue
18th Floor
New York, New York 10152
Attention: Kevin J. Conway
Telecopy: (212) 407-5252
and:
Debevoise & Plimpton
875 Third Avenue
New York New York 10022
Attention: Paul S. Bird
Telecopy: (212) 909-6836
or to such other person or address as the Buyer shall furnish to NFC in writing.
(b) If to NFC or any Affiliate, to:
NFC PLC
66 Chiltern Street
London W1M 2 LT
England
Attention: Company Secretary
Telecopy: (44-207) 224-2381
11
<PAGE>
With a copy to:
Kirkland & Ellis
Citicorp Center
153 E. 53rd Street
New York, New York 10022
Attention: Kirk A. Radke
Telecopy: (212) 446-4900
or to such other person or address as NFC shall furnish to the Buyer in writing.
All such notices, requests, instructions, approvals and other
communications shall be deemed to have been received on the date of delivery or
on the third business day after the mailing thereof.
7.6. Headings. The headings contained in this Agreement are for
purposes of convenience only and shall not affect the meaning or interpretation
of this Agreement.
7.7. Entire Agreement. This Agreement, including Schedule A hereto,
together with the Acquisition Agreement together constitute the entire agreement
and supersedes all prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter hereof.
7.8. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original and all of which shall
together constitute one and the same instrument.
7.9. Applicable Law. This Agreement and the legal relations among
the parties hereto will be governed by and construed in accordance with the
substantive laws of the State of New York, without giving effect to the
principles of conflict of laws thereof.
7.10. Binding Effect. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective heirs, successors and
permitted assigns.
7.11. Assignment and Delegation. Neither this Agreement nor the
rights and duties under this Agreement shall be assignable by either party
hereto without the prior written consent of the other, provided that the Buyer
may assign this Agreement or any or all of its right or duties hereunder to any
Affiliate of the Buyer or to any lender to the Buyer or any subsidiary or
Affiliate thereof as security for obligations to such lender.
12
<PAGE>
No assignment hereunder shall in any way affect the parties' obligations or
liabilities under this Agreement. Any purported assignment in violation of this
Section 7.11 shall be void.
7.12. Amendment; Waivers, etc. No amendment, modification or
discharge of this Agreement, and no waiver hereunder, shall be valid or binding
unless set forth in writing and duly executed by the party against whom
enforcement of the amendment, modification, discharge or waiver is sought. Any
such waiver shall constitute a waiver only with respect to the specific matter
described in such writing and shall in no way impair the rights of the party
granting such waiver in any other respect or at any other time.
7.13. Severability. In the event that any provision of this
Agreement shall be found to be void or unenforceable, such findings shall not be
construed to render any other provision of this Agreement either void or
unenforceable, and all other provisions shall remain in full force and effect
unless the provisions which are invalid or unenforceable shall substantially
affect the rights or obligations granted to or undertaken by either party.
13
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first above written.
NA HOLDING CORPORATION
By /s/Ralph A. Ford
--------------------------------------
Name: Ralph A. Ford
Title: Secretary
NFC PLC
By /s/Jeremy Letchford
--------------------------------------
Name: Jeremy Letchford
Title: Secretary
<PAGE>
SCHEDULE A
A. Services to Be Provided Directly by NFC and its Affiliates
<TABLE>
<CAPTION>
Jurisdiction Service Expiration Date Fees
- ------------ ------- --------------- ----
<S> <C> <C> <C>
U.K./Europe Real Estate
Full range of property services, including, 6 months from (pound)6,000
upon consultation with the Buyer, the Closing Date per month **
providing the key interface with landlords
and negotiating leases, ensuring legality
and necessary review of property leases*
and providing consultancy service for
property search activities.
U.K./Europe IT Services
E-mail related services, including 12 months from the (pound)4,000
provision of a network "cloud" for Closing Date per month
transmission of external e-mails via
NFC's servers in Bedford and continued
provision of Lotus Notes for services of
Moving Services FCO Department.
IT Infrastructure services, including 18 months from the (pound)1,200
provision of a network "cloud" for Closing Date per month
access to and printing from the Oracle
Financials System and e-mail communications
with Andersen Consulting in Bedford.
One-off implementation of network N/A Total costs of up to
firewalls to provide security within 3 (pound)5,000 to be borne
months of the Closing Date equally between NFC and the
Buyer, with excess to be borne
by NFC
U.S. Communication link and e-mail related 12 months from the (pound)650 per month
service, including provision of a network Closing Date
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C>
"cloud" for the transmission of e-mails
to and from Moving Service Europe only via
NFC's servers in Columbus.
Europe/Canada Pensions/Benefits
To the extent that Company Group 6 months from the On same basis as prior to
employees participate in NFC-maintained Closing Date Closing Date
pension plans prior to the Closing Date,
continued participation in such plans,
subject to applicable law.
</TABLE>
B. Services to Be Provided by Third Party Providers
<TABLE>
<S> <C> <C> <C>
U.K. Mobile Phones
Short-dialling services for mobile phones 6 months from the (pound)1,250 for 6 months
to be provided under NFC's group Closing Date
contract with Vodaphone relating to the
Mobex offering
Access to Mobile extension's gateway via 6 months from the (pound)211 per month
BT FeatureNet node line provided under Closing Date
an NFC group contract with BT.
Continued inclusion of UK members of 30 November 2000 (pound)1,040 per month
the Company group in the NFC contract (excluding handset charge
with AAC Services Ltd. The service
provides for the management and related
administration of mobile phones with the
NFC group. AAC's operating costs are
covered through a charge levied of
(pound)3.00 per handset per month. In
addition, NFC covers the cost of
accommodation, equipment, telephone charges
etc. in Bedford.
Aerophone supplies handsets via separate Expiration date of Nil
contracts per handset direct to the user. relevant contract
The majority of the contracts with the
Company Group expire in November 2001.
Billing is direct to the user.
</TABLE>
2
<PAGE>
<TABLE>
<S> <C> <C> <C>
NFC will use its reasonable efforts to N/A Nil
assist such member of the Company Group
in entering into a renewal or alternative
arrangement upon expiry or earlier
termination of the contract with AAC.
Worldwide Accounting
Use of software and data processing and 6 months from the (pound)2,000 per month
other services to continue the present Closing Date
financial consolidation system for the
Company Group (HYPERION)
</TABLE>
NOTES:
* Excluding legal support for mainland Europe outsourced prior to the
Closing Date to existing third party service providers.
** Excluding all reasonable travelling, subsistence and disbursement
expenses approved in accordance with Section 2.2. if required to be
approved thereunder.
+ Subject to compatibility with and consent, if required, of the new
insurers of Pickfords Limited.
3
<PAGE>
<TABLE>
<CAPTION>
Jurisdiction Service Expiration Date Fees
- ------------ ------- --------------- ----
<S> <C> <C> <C>
U.K. Electricity
(h) Sites using less than 100KW per annum: 31 May 2000 Nil
Continued inclusion of the Company Group at
those sites currently occupied by the
Company Group and included in the NFC group
contract with Norweb and reasonable efforts
to secure the Company Group's inclusion in a
new contract with NFC's chosen supplier of
electricity for the period 1 June 2000
through 31 May 2001. (Invoicing direct
between supplier and site.)
Sites using in excess of 100KW per annum: 30 September 2000 Nil
Continued inclusion in existing contract
covering Enfield with London Electricity to
expire on 30 September 1999 and inclusion of
Southbury Road, Enfield with other NFC group
companies in new contract agreed with
Independent Energy to commence 1 October
1999. (Invoicing direct between supplier and
site.)
U.K. Gas
Continued inclusion of Company Group site 31 December 1999 Nil
at Glasgow in NFC group gas contract with
Midland Sales (MEB). (Invoicing direct
between supplier and site.)
Continued inclusion of Company Group 31 December 2000 Nil
entities in existing NFC gas contract until
expiry of such contract on December 31, 1999
and NFC to use its reasonable endeavours to
include 5 sites of the Company Group -
namely Glasgow, Enfield, Nottingham x 2 and
Chesterfield (and such number of additional
sites as NFC may reasonably be able to
include) into a new contract with a chosen
supplier effective for 12 months commencing
1 January 2000.
</TABLE>
4
<PAGE>
<TABLE>
<S> <C> <C> <C>
U.K. Fuel
Provision of fuel on the same terms and Two years from the Same basis as during 12
conditions as provided during the 12 months Closing Date months prior to Closing Date
prior to the Closing Date.
Ferry Tariffs
Continued inclusion of the Company Group 31 December 1999 Nil
in NFC's agreed tariff rates with 16 ferry
operators. (Invoicing direct between
supplier and Group Company.)
At Buyer's option, NFC will use its N/A Nil
reasonable efforts to include the Company
Group into the NFC group new tariff rates
agreement for the period from 1 January 2000
to 31 December 2000.
Stationery
Continued inclusion of the Company Group Niceday: Nil
in the stationery supply contract with 29 February 2000
Guilbert Niceday and the contract for
printed forms with Londsale. Londsale:
31 December 1999
NFC will use its reasonable efforts to N/A Nil
include the Company Group in any future
stationery contract entered into by NFC in
respect of such stationery upon the renewal
of these contracts.
U.K. Tires and Trucks
To the extent that there have been NFC group 12 months from Nil
procurement arrangements with respect to Closing Date
tires during the past 12 months, continued
inclusion of the Company Group in such
arrangements.
</TABLE>
5
<PAGE>
<TABLE>
<S> <C> <C>
NFC will use its reasonable efforts to N/A Nil
include the Company Group in future group
procurement arrangements with respect to
tires that replace any such existing
arrangements.
To the extent that there have been NFC group 12 months from Nil
tenders with respect to truck chassis and Closing Date
bodies during the past 12 months, continued
inclusion of the Company Group in such
tenders.
NFC will use its reasonable efforts to N/A Nil
include the Company Group in future group
procurement arrangements with respect to
truck chassis and bodies that replace any
such existing arrangements.
</TABLE>
6
<PAGE>
Exhibit 10.16
CONFORMED COPY
================================================================================
TAX MATTERS AGREEMENT
between
NA HOLDING CORPORATION
and
NFC plc
Dated as of September 14, 1999
================================================================================
<PAGE>
TABLE OF CONTENTS
Section Page
- ------- ----
1. Responsibility for Taxes...........................................1
2. Allocation of Taxes for Straddle Periods...........................3
3. Tax Refunds; Pre-Closing Losses; Effect of Adjustments.............4
4. Preparation and Filing of Tax Returns..............................6
5. Tax Payments......................................................12
6. Tax Contests......................................................15
7. Assistance and Cooperation........................................17
8. Separate Tax Agreements Required for Specific Jurisdictions.......20
9. Group Relief......................................................21
10. Disputes..........................................................22
11. Termination of Tax Sharing Agreements.............................23
12. Limitation on Indemnity Payments..................................24
13. Expenses..........................................................25
14. Survival..........................................................25
15. Definitions.......................................................26
16. Miscellaneous.....................................................30
i
<PAGE>
TAX MATTERS AGREEMENT
TAX MATTERS AGREEMENT, dated as of September 14, 1999, between NA HOLDING
CORPORATION, a Delaware corporation (the "Buyer"), and NFC plc, a company
organized under the laws of England and Wales (the "Seller").
WHEREAS, contemporaneously with the execution of this Agreement, the Buyer
and the Seller are entering into an Acquisition Agreement, dated as of the date
hereof (the "Acquisition Agreement");
WHEREAS, the Buyer and the Seller wish to set forth their agreement with
respect to certain matters as set forth below.
NOW THEREFORE, in consideration of the premises and the mutual agreements
set forth herein, the parties hereto agree as follows:
1. Responsibility for Taxes. (a) Seller's Responsibility. The Seller shall
bear (and shall pay, reimburse, indemnify and hold harmless the Buyer, each
member of the Company Group and their respective Affiliates and their respective
officers, directors, employees, agents, advisers and representatives for, from
and against) any and all liabilities for Taxes (or payments in respect of Taxes)
which (i) are imposed on, allocated to, or incurred or payable by any member of
the Company Group (or in respect of the Canadian Assets) with respect to any
Pre-Closing Tax Period (or are otherwise reportable on any U.S. Consolidated
Return), or (ii) in whole or in part are attributable to or arise from (or from
any combination of) any Corporate Restructuring Transaction, any transaction
<PAGE>
contemplated by the Acquisition Agreement, or (in the case of any liability
under or pursuant to section 30 TCGA 1992, section 31A TCGA 1992 or section 179
TCGA 1992 (or any combination thereof)) any event occurring at or prior to the
Closing; including (for each of clause (i) and (ii)) but not limited to (x) any
liability for such Taxes (or any such liability for any payment in respect of
Taxes) under Treasury Regulation section 1.1502-6 or any similar provision of
U.S. state or local law or non-U.S. law, (y) any liability for such Taxes (or
any such liability for any payment in respect of Taxes) arising under principles
of transferee or successor liability or by contract and (z) any combination of
the foregoing. In addition, the Seller shall bear (and shall reimburse,
indemnify and hold harmless the Buyer, each member of the Company Group and
their respective Affiliates for, from and against) any and all liabilities of
the Buyer, the Company Group and their Affiliates to make a payment in respect
of a surrender of Group Relief under Section 9.
(b) Buyer's Responsibility. The Buyer shall bear (and shall pay,
reimburse, indemnify and hold harmless the Seller and its Affiliates and their
respective officers, directors, employees, agents, advisers and representatives
for, from and against) any and all liabilities (other than liabilities for which
the Seller is responsible by virtue of the Acquisition Agreement) for Taxes
imposed on, allocated to, or incurred or payable by any member of the Company
Group (or in respect of the Canadian Assets) that are not described as being the
responsibility of the Seller in Section 1(a), including any such liability for
any Post-Closing Tax Period under section 767A or 767AA of the Taxes Act
2
<PAGE>
which falls on a member of the Seller Group and for which a member of the
Company Group is primarily liable.
2. Allocation of Taxes for Straddle Periods. In the case of any Tax for
any Tax Period that begins on or before the Closing Date and ends after the
Closing Date (a "Straddle Period"), the amount of such Tax allocated to each of
the Pre-Closing Tax Period and the Post-Closing Tax Period shall be determined
as follows: (i) in the case of any real property, personal property, intangibles
and other similar Tax, (A) the amount of such Tax that is allocable to the
Pre-Closing Tax Period shall be the amount of such Tax for the entire Straddle
Period multiplied by a fraction the numerator of which is the number of days in
the portion of such Straddle Period ending on the Closing Date and the
denominator of which is the total number of days in the entire Straddle Period
and (B) the amount of such Tax that is allocable to the Post-Closing Tax Period
shall be the amount of such Tax for the entire Straddle Period minus the amount
of such Tax allocated to the Pre-Closing Tax Period pursuant to clause (A)
hereof and (ii) in the case of any Tax not described in clause (i), on the basis
of the actual activities of the members of the Company Group using an
interim-closing-of-the-books method and assuming that such Straddle Period ended
at the close of the Closing Date. To the extent permitted by applicable law, the
Seller and the Buyer shall (and shall to the extent practicable cause their
respective Affiliates to) prepare all relevant Tax Returns in a manner
consistent with the allocation of Taxes in this Section 2.
3
<PAGE>
3. Tax Refunds; Pre-Closing Losses; Effect of Adjustments. (a) Tax
Refunds. Any Tax refunds received from a Tax Authority for any Tax Period ending
on or before the Closing Date shall be for the account of (and paid to) the
Seller. To the extent that a credit (or set-off) for Taxes paid for a Tax Period
ending on or before the Closing Date is actually credited (or set-off) against a
Tax otherwise due by a member of the Company Group for a Post-Closing Tax
Period, the amount of such credit shall be for the account of (and paid to) the
Seller. Any refunds or credits (or set-offs) for Taxes paid of any member of the
Company Group for any Straddle Period shall be apportioned between the Seller
and the Buyer in accordance with the principles set forth in Section 2 and this
Section 3(a) (and the amount (if any) apportioned to the Pre-Closing Tax Period
shall be for the account of (and paid to) the Seller). If (i) a Tax liability
arises that is described in Section 1(a)(i), (ii) such liability is in the
nature of a withholding tax that was required to have been withheld from a
payment made by a member of the Company Group, (iii) the Seller pays the Buyer
an amount equal to such liability, and (iv) the payment of such withholding tax
gives rise to a credit of Taxes paid that actually reduces or eliminates an
actual Tax liability otherwise due by a member of the Company Group in respect
of a Post-Closing Tax Period (other than a Tax liability for which the Seller
would be responsible under Section 1(a)) or in respect of which a member of the
Company Group receives a refund in a Post-Closing Tax Period, the amount of the
actual Tax liability that is reduced or eliminated or the amount of the refund,
as the case may be, shall be for the account of (and paid to) the Seller.
Without duplication of any other amounts payable
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hereunder, if the Seller makes a payment pursuant to Section 1(a)(ii) and the
amount of the underlying Tax that gave rise to the payment is subsequently
refunded (or gives rise to a credit (or set-off) for Taxes paid that is actually
credited (or set-off) against a Tax otherwise due by a member of the Company
Group for a Post-Closing Tax Period), the amount of such refund or credit (or
set-off) shall be for the account of (and paid to) the Seller. To the extent
that any refund or any credit (or set-off) of Taxes paid that gives rise to a
payment to the Seller pursuant to this Section 3(a) (or the underlying item or
claim that gave rise to such a refund or credit (or set-off) of Taxes paid) is
subsequently disallowed by any Tax Authority, the amount of such refund or
credit (or set-off) of Taxes paid shall be repaid to the Buyer (and the Seller
shall indemnify and hold harmless the Buyer, each member of the Company Group
and their respective Affiliates in respect of such repayment). Notwithstanding
any other provision of this Section 3(a), the amount of any payment required to
be made to the Seller under this Section 3(a) shall be net of any Taxes (or
other reasonable costs) incurred by or imposed on the Buyer, any member of the
Company Group or their Affiliates in connection with the item or events giving
rise to such payment.
(b) Pre-Closing Losses. Notwithstanding any other provision of this
Section 3, for the avoidance of doubt, the Buyer shall not be required to make
any payment under this Agreement to the Seller in respect of (and the amount of
the Seller's liability under Section 1(a) shall be determined without regard to)
any net operating loss, net capital loss or other tax credit or benefit that is
attributable to, arises from or relates to any Pre-
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Closing Tax Period (a "Pre-Closing Loss") and is carried forward to any
Post-Closing Tax Period. For the avoidance of doubt, this Section 3(c) shall not
prevent the Seller from using any Pre-Closing Loss to reduce or mitigate its
liability under Section 1(a).
(c) Effect of Adjustments. Notwithstanding any other provision of this
Section 3, for the avoidance of doubt, for the purposes of determining the
amount of the Seller's liability under Section 1(a), if there is an adjustment
made with respect to any Tax (including without limitation any disclaimer or
failure to claim capital allowances in the United Kingdom) for which the Seller
is liable under Section 1(a), there shall not be taken into account any
resulting or corresponding increase in (i) the Tax basis of any asset or
property (or, in the case of a disclaimer or failure to claim capital
allowances, the amount of any qualifying expenditure) that is or may be taken
into account in any Post-Closing Tax Period or (ii) any Tax deduction or Tax
credit (other than a credit for Taxes paid that is described in Section 3(a))
that is or may be taken into account in any Post-Closing Tax Period.
4. Preparation and Filing of Tax Returns. (a) Seller's Responsibility. The
Seller shall prepare and file (or cause to be prepared and filed) (i) all Tax
Returns of (or relating to) the members of the Company Group required to be
filed (and in fact filed) on or prior to the Closing Date and (ii) all U.S.
Consolidated Returns (without regard to when such U.S. Consolidated Returns are
required to be filed).
(b) Joint Responsibility. The Seller shall prepare (or cause to be
prepared) (i) each Tax Return of or relating to the members of the Company Group
for any Tax Period
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ending on or before the Closing Date that is required to be filed after the
Closing Date and (ii) the portion of any U.K. Straddle Return that relates to
any liability under section 179 TCGA 1992 in respect of the U.K. Restructuring
or any other liability arising in respect of the U.K. Restructuring, in each
case that may give rise to a claim under Section 1(a). Subject to Section 4(e)
hereof, the Buyer shall file (or cause to be filed) any such Tax Return (or U.K.
Straddle Return) unless the Buyer determines in its reasonable discretion that
(x) such Tax Return (or U.K. Straddle Return) is false, misleading or fraudulent
in any respect or (y) the filing of such Tax Return (or U.K. Straddle Return)
could give rise to the imposition of a penalty, excise tax or similar item on or
with respect to any individual connected with the filing (including without
limitation the individual that would sign the Tax Return (or U.K. Straddle
Return)).
(c) Buyer's Responsibility. The Buyer shall prepare and file all Tax
Returns of (or relating to) the members of the Company Group required to be
filed after the Closing Date that are not described in Section 4(a) or (b),
including all Tax Returns for Straddle Periods (except to the extent otherwise
provided in Section 4(b)(ii)).
(d) Tax Accounting Practices. To the extent practicable and permitted by
law, any Tax Return for any Pre-Closing Tax Period or any Straddle Period shall
be prepared in a manner consistent with past Tax practices and accounting
practices used with respect to the particular Tax in question (unless such past
practices are no longer permissible either under the applicable law or generally
accepted accounting principles in the relevant jurisdiction, as the case may
be), and to the extent any items are not covered by past
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practices (or in the event such past practices are no longer permissible under
the applicable law), in accordance with reasonable Tax practices and accounting
practices selected by the party responsible for preparing the Tax Return (or
portion thereof), provided that any Tax Return for any Straddle Period shall not
be required to be prepared in a manner consistent with past Tax practices or
accounting practices used with respect to the particular Tax in question to the
extent that (i) the Seller consents in writing to the preparation of such Tax
Return using a different practice (which consent shall not be unreasonably
withheld) or (ii) the Buyer notifies the Seller in writing that the Buyer, its
Affiliates and the members of the Company Group have elected to forgo the right
to any payment pursuant to Section 1(a) that might result from the preparation
of such Tax Return using a different practice. For the purposes of clause (i)
hereof, if the adoption of a different Tax practice or accounting practice would
increase the liability of the Seller under Section 1(a) (other than by a de
minimis amount) it shall not be unreasonable for the Seller to withhold its
consent. The Seller shall be entitled to claim the maximum United Kingdom Tax
reliefs and allowances as is allowed by law, except to the extent that any such
claim would result in (or increase) a loss that would be available for surrender
by way of Group Relief other than to another member of the Company Group.
(e) Right to Review Tax Returns.
(i) Without prejudice to the Seller's rights under Section 4(b)(ii),
if requested by the Seller, the Buyer shall make available to the Seller
and its representatives for review and comment any Tax Returns and related
work papers relating to the
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members of the Company Group for any Straddle Period. The Buyer shall use
its reasonable best efforts to make such Tax Returns and work papers
available for review as required under this paragraph sufficiently in
advance of the due date for filing such Tax Returns to provide the Seller
with a meaningful opportunity to analyze, comment on and dispute such Tax
Returns and for such Tax Returns to be modified, as appropriate, before
filing.
(ii) The Seller shall make available to the Buyer and its
representatives for review and comment any Tax Returns described in
Section 4(b) and any related work papers. The Seller shall use its
reasonable best efforts to make such Tax Returns and work papers available
for review as required under this paragraph sufficiently in advance of the
due date for filing such Tax Returns to provide the Buyer and its
representatives with a meaningful opportunity to analyze, comment on and
dispute such Tax Returns and for such Tax Returns to be modified, as
appropriate, before filing, provided that (A) in the case of any Tax
Return described in Section 4(b)(i), the Seller shall not be required to
incorporate any of the Buyer's comments unless (I) such Tax Return would
not satisfy the filing standard set forth in the last sentence of Section
4(b) if such comments were not incorporated (or the Seller has not
complied with the provisions of Section 4(d) in preparing such Tax Return)
or (II) the Buyer notifies the Seller that the Buyer, its Affiliates and
the members of the Company Group have elected to forgo the right to any
payment pursuant to Section 1(a) that results from the incorporation of
such comments and (B) in the case of any portion of
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Tax Return described in Section 4(b)(ii), the Seller shall not be required
to incorporate any of the Buyer's comments unless such portion would not
satisfy the filing standard set forth in the last sentence of Section 4(b)
if such comments were not incorporated (or the Seller has not complied
with the provisions of Section 4(d) in preparing such Tax Return). For the
avoidance of doubt, the Seller shall be required to incorporate any
comments of the Buyer referred to in clause (A) or (B) hereof.
(f) Amended Returns. Except to the extent provided in Section 4(g) or (h)
or required by law, the Buyer will not (i) file any amended return, carryback
claim, or other adjustment request relating to any member of the Company Group
for any Tax Period ending on or prior to the Closing Date (or the portion of any
U.K. Straddle Return described in Section 4(b)(ii), provided that this Section
4(f) shall not restrict the rights of the Buyer to file any amended return,
carryback claim, or other adjustment request relating to any other portion of a
U.K. Straddle Return) without the Seller's written consent and (ii) with respect
to any Pre-Closing Tax Period, make or give any other notice, election,
disclaimer or claim without the Seller's written consent.
(g) Amended Returns Requested by Seller. The Seller shall be entitled to
prepare (or cause to be prepared) and the Buyer shall file (or cause to be
filed) (i) an amended Tax Return of any member of the Company Group for any Tax
Period that ends on or before the Closing Date (and the portion of any U.K.
Straddle Return described in Section 4(b)(ii)), provided that the effect of such
amended Tax Return is not to increase any Tax for any Post-Closing Tax Period
(other than an increase mandated by law). The
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preparation and filing of any such amended Tax Return shall be governed by
principles analogous to those set forth in Section 4(b), (d) and (e) hereof. The
Seller shall procure that (A) the Buyer is kept fully informed of all material
written correspondence with any Tax Authority in respect of any such amended Tax
Return and (B) no claim, election, disclaimer, notice or consent is made by or
on behalf of any member of the Company Group except to the extent specifically
permitted by Section 4(h) hereof. The Buyer and the Seller shall cooperate in
good faith in connection with the filing of any amended U.K. Straddle Return.
Notwithstanding the proviso set forth in the first sentence of this Section
4(g), the Seller shall be entitled to claim the maximum United Kingdom Tax
reliefs and allowances as is allowed by law, except to the extent any such claim
would result in (or increase) a loss that would be available for surrender by
way of Group Relief other than to another member of the Company Group.
(h) Other Rules Relating to Tax Returns Prepared by Seller. Subject to
each other provision of this Agreement, the Buyer shall take (or cause to be
taken) commercially reasonably steps requested by the Seller (and identified on
Schedule 4(h) hereto) to enable the Tax Returns (or the portion thereof)
described in Section 4(a) or (b) to be prepared, submitted and agreed in
accordance with the rights of the Seller and the Buyer, including without
limitation (to the extent identified on Schedule 4(h) hereto) causing all such
claims, disclaimers, surrenders, indices and elections or other documentation as
may be directed by the Seller which are listed in Schedule 4(h) and which relate
exclusively to the periods covered by such Tax Returns (or the portion
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thereof) to be authorized, signed and returned to the Seller or its duly
authorized agent for submission to the appropriate Tax Authority without undue
or unreasonable delay, provided that the Buyer shall not be required to take (or
cause to be taken) any step if the effect would be to increase any Tax for any
Post-Closing Tax Period (unless the step is mandated by law). Notwithstanding
the proviso set forth in the immediately-preceding sentence, the Seller shall be
entitled to claim the maximum United Kingdom Tax reliefs and allowances as is
allowed by law, except to the extent any such claim would result in (or
increase) a loss that would be available for surrender by way of Group Relief
other than to another member of the Company Group.
5. Tax Payments. (a) Seller Tax Payments to Tax Authorities. The Seller
shall pay (or cause to be paid) to the appropriate Tax Authority all Taxes
reported or reportable on or otherwise due with respect to any U.S. Consolidated
Returns.
(b) Buyer Tax Payments to Tax Authorities. The Buyer shall pay (or cause
to be paid) to the appropriate Tax Authority all Taxes due by any member of the
Company Group that are not described in Section 5(a) or the proviso in Section
5(c) (or to the Seller or its Affiliates in the case of a liability of the Buyer
under Section 1(b) in respect of liability imposed pursuant to section 767A or
767AA Taxes Act).
(c) Seller Indemnification Payments to Buyer. In the case of any liability
for which the Seller is responsible under the first sentence of Section 1(a),
the Seller shall (to the extent such liability is not satisfied by the Seller
pursuant to Section 5(a) hereof) pay or cause to be paid by the relevant member
of the Selling Group the amount of such
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liability to the relevant member of the Buying Group within five business days
following written notice from the Buyer that payment of such liability is due
(or, if later, two business days before the Tax in question is due to the Tax
Authority), provided that if the relevant liability can be discharged by a
payment by the Seller directly to the Tax Authority in question and if the
Seller elects and the Buyer consents (which consent shall not be unreasonably
withheld), the Seller may pay or cause to be paid by the relevant member of the
Seller Group the amount of such liability directly to the particular Tax
Authority to which the underlying liability is owed. In the case of any
liability for which the Seller is responsible under the second sentence of
Section 1(a) in respect of any payment for Group Relief, the Seller shall pay or
cause to be paid by the relevant member of the Selling Group the amount of such
liability to the relevant member of the Buying Group on the business day before
the business day upon which the payment for Group Relief is due in accordance
with Article 9 (subject always to the provisions thereof relating to
prepayment).
(d) Buyer Indemnification Payments to Seller. In the case of any liability
for which the Buyer is responsible under Section 1(b), the Buyer shall (to the
extent such liability is not satisfied by the Buyer pursuant to Section 5(b)
hereof) pay or cause to be paid by the relevant member of the Buying Group the
amount of such liability to the relevant member of the Selling Group within five
business days following written notice from the Seller that payment of such
liability is due.
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(e) Refund Payments. Any payments required to be made pursuant to Section
3(a) shall be made within five business days of the event that establishes the
entitlement to such payment.
(f) Interest Payments. All payments under this Agreement not made within
the time required shall (save insofar as the amount of the payment to be made
already compensates the recipient for such late payment by reason of the
inclusion of "interest" in the definition of Tax) bear interest on the amount of
the payment from the last date provided for such payment until the date paid.
The interest payable shall be computed at an interest rate equal to 1% plus The
Chase Manhattan Bank prime rate.
(g) Characterization of Payments. Except to the extent otherwise provided
by law or as otherwise provided below, any payments pursuant to this Agreement
shall be treated as adjustments to the consideration paid by the relevant Buyer
Subsidiary pursuant to the Acquisition Agreement. Any payments of interest
pursuant to Section 5(f) shall be treated as payments of interest.
(h) Entities Making and Receiving Payments. Notwithstanding any other
provision of this Section 5, in the case of any payment required to be made
between the Buyer and the Seller under this Section 5 in respect of a particular
member of the Company Group, the payment shall be made between the relevant
Selling Subsidiary that (directly or indirectly) disposed of such member and the
relevant Buyer Subsidiary that (directly or indirectly) acquired such member. In
the case of any payment made under this Agreement in respect of the Canada
Assets, the payment shall be made between the Buyer
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Subsidiary that purchased the Canada Assets and the Selling Canada Subsidiary.
In the case of any payment required to be made by the Seller to the Buyer in
respect of the Target U.K. Subsidiary (or its Subsidiaries), the Seller shall
make such payment to the Buyer Subsidiary that subscribed for shares in the
Target U.K. Subsidiary, provided that if the Seller elects and the Buyer
consents (which consent shall not be unreasonably withheld), the Seller may make
such payment (or cause such payment to be made) directly to the Target U.K.
Subsidiary (or the relevant Subsidiary of the Target U.K. Subsidiary).
6. Tax Contests. (a) Control of Proceedings. Following the Closing Date,
the Seller shall, and shall be furnished by the relevant members of the Company
Group with powers of attorney (or any other document or authorization) necessary
or appropriate to enable the Seller to control the conduct of all stages of any
negotiation, settlement discussion, agreement process, dispute, audit or other
administrative or judicial proceeding (collectively, "Proceedings"), in each
case with respect to any Tax Returns described in Section 4(a) or (b)(i) (and
the portion of any U.K. Straddle Return described in Section 4(b)(ii)), provided
that the Buyer shall have the right to take control of any such Proceeding
(other than a Proceeding involving exclusively a U.S. Consolidated Return) if
the Buyer notifies the Seller that the Buyer, its Affiliates and the members of
the Company Group have elected to forgo the right to any payment pursuant to
Section 1(a) that might otherwise result from such Proceeding. The Buyer shall
control the conduct of any other Proceeding with respect to the Tax liability of
the members of the Company Group for any Tax Period or portion thereof.
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(b) Proceedings Controlled by Seller. Subject to the control rights
provided in Section 6(a), with respect to any Proceeding that the Seller
controls, the Seller shall (i) give to the Buyer a copy of any Tax adjustment
proposed in writing pursuant to any Proceeding controlled by the Seller with
respect to the assets or activities of any member of the Company Group, (ii)
discuss with the Buyer and the Buyer's tax advisors the position that it intends
to take regarding any material issue concerning such assets or activities, (iii)
keep the Buyer reasonably informed and consult with the Buyer with respect to
any issue that reasonably could be expected to have an adverse effect on the
Buyer, any of its Affiliates or any member of the Company Group (other than an
adverse effect that is de minimis with respect to such Person) and (iv) not, and
shall not permit any of its Affiliates to, enter into any settlement or
agreement in compromise of any proposed adjustment which purports to bind the
Buyer, any of its Affiliates or any member of the Company Group with respect to
any Tax Period ending after the Closing Date (other than solely in respect of a
liability described in Section 4(b)(ii) for which the Seller is responsible
under Section 1(a)) (or would be inconsistent with the principles set forth in
Section 4(d) or (h)) without the express written consent of the Buyer, which
consent shall not be unreasonably withheld. In addition, the Seller shall
provide the Buyer with a copy of all correspondence or other document received
by any member of the Seller Group from a Tax Authority that relates to a member
of the Company Group.
(c) Proceedings Controlled by Buyer. Subject to the control rights
provided in Section 6(a), the Buyer (i) shall give prompt notice to the Seller
of the commencement of
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any Proceeding which could give rise to a claim for payment against the Seller
under this Agreement (and of any other written materials received from a Tax
Authority that relate to a Pre-Closing Tax Period and that could reasonably be
expected to give rise to a claim under Section 1(a)); (ii) with respect to any
Proceeding controlled by the Buyer, shall afford the Seller and its tax advisors
a reasonable opportunity to participate in the conduct of any administrative or
judicial proceeding regarding a proposed adjustment described in clause (i)
above including but not limited to the right to participate in conferences with
Tax Authorities and submit pertinent material in support of the Seller's
position, and (iii) shall not, and shall not permit any of its Affiliates to,
accept any proposed adjustment or enter into any settlement or agreement in
compromise for any Pre-Closing Tax Period (or in respect of any liability for
which the Seller is responsible under Section 1(a)(ii)) which would result in a
claim for indemnification against the Seller pursuant to this Agreement without
the express written consent of the Seller, which consent shall not be
unreasonably withheld.
7. Assistance and Cooperation. (a) In General. After the Closing Date, the
Seller and the Buyer shall cooperate (and cause their respective Affiliates to
cooperate) with each other and their respective Affiliates and with their
respective advisors and agents, including accounting firms and legal counsel, in
connection with Tax matters relating to the Company Group (and any other matters
arising under this Agreement) including (i) preparation and filing and agreement
with the relevant Tax Authority of Tax Returns, (ii) determining the liability
for and amount of any Taxes due (including estimated
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Taxes) and the right to and amount of any refund of Taxes, (iii) examinations of
Tax Returns, and (iv) any administrative or judicial proceeding in respect of
Taxes assessed or proposed to be assessed. Such cooperation shall include making
all information and documents in their possession relating to the Company Group
available to each other and their agents as reasonably requested. The Seller and
the Buyer shall also make available to each other, to each other's respective
Affiliates and to their advisors and agents, as reasonably requested and
available, personnel (including officers, directors, employees, and agents)
responsible for preparing, maintaining and interpreting information and docu
ments relevant to Taxes, and personnel reasonably required as witnesses or for
purposes of providing information or documents in connection with any
administrative or judicial proceedings relating to Taxes.
(b) Certificates. The Buyer and the Seller shall, upon request of the
other party, use commercially reasonable efforts to obtain any certificate or
other document from any Tax Authority or any other Person as may be necessary to
mitigate, reduce, or eliminate any Tax relating to the Company Group (including
but not limited to with respect to the transactions contemplated by the
Acquisition Agreement).
(c) Recovery. If (x) any member of the Company Group is or becomes
entitled to recover from some other Person any amount in respect of a Tax as a
result of any matter or circumstance, (y) such member of the Company Group
determines (in its reasonable discretion) that it would not have any prejudicial
effect on its business to seek such recovery from such other Person, and (z)
such matter or circumstances is likely to
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result in a payment pursuant to Section 1(a) of this Agreement, then (1) the
Buyer shall notify the Seller of such entitlement, (2) the Buyer shall take (or
cause to be taken) commercially reasonable steps to enforce such recovery, and
(3) the amount required to be paid pursuant to Section 1(a) in respect of such
matter or circumstances shall be reduced (but not below zero) by an amount equal
to the amount actually recovered (and any amount already paid pursuant to
Section 1(a) in respect of such matter or circumstance shall be repaid by the
Buyer (net of any Tax liability incurred by reason of such payment or
repayment). Notwithstanding any other provision of this Agreement, the Seller
shall pay the Buyer an amount equal to any Tax paid or incurred by the recipient
in respect of a recovery made hereunder plus any reasonable costs and expenses
incurred in respect of such recovery.
(d) Confidentiality. Any information or documents described in this
Section 7 shall be kept confidential by the Person receiving the information or
documents, except as may otherwise be necessary in connection with the filing of
Tax Returns or in connection with any administrative or judicial proceedings
relating to Taxes or as otherwise required by law.
(e) Limitation. Nothing in this Section 7 shall require the Seller or the
Buyer to provide any information or documents relating to the Seller's or the
Buyer's assets or activities other than the assets and activities of the Company
Group, or to disclose any matter to the extent such access and disclosure would
(i) unreasonably disrupt the normal operations of the Company Group; (ii)
violate any applicable law or regulation; (iii) violate
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the terms of any agreement to which the disclosing party or any of its
Affiliates is bound (provided that the party so bound shall use its reasonable
best efforts to obtain a waiver of the non-disclosure provisions of such
agreement), or (iv) impair any attorney-client or tax-advisor privilege or
work-product protection of the disclosing party.
(f) Retention of Records. Buyer and Seller recognize that Buyer and Seller
and their respective Affiliates will need access, from time to time after the
Closing Date, to certain accounting and tax records and information relating to
the Company Group to the extent such records and information pertain to events
occurring prior to the Closing Date. Accordingly, Buyer and Seller agree that,
commencing with the execution of this Agreement, Buyer and Seller shall, and
shall cause their respective Affiliates and succes sors to (i) retain and
maintain such records which, as of the execution of this Agreement, are in its
possession or control or as to which it otherwise has a right of access for the
longer of (A) the six-year period beginning on the Closing Date or (B) the full
period of the applicable statute of limitations, including any extension
thereof, and (ii) abide by all record retention agreements entered into with any
taxing authority and to give the other party reasonable notice prior to
transferring, discarding or destroying any such records and information, and, if
the other party so requests, to allow the other party to take possession of such
materials.
8. Separate Tax Agreements Required for Specific Jurisdictions. The Seller
and the Buyer shall negotiate in good faith any separate agreements for
particular Tax jurisdictions that are necessary to implement the intent of the
parties under this
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Agreement, provided that the terms of any such agreements shall not be
inconsistent with the terms of this Agreement.
9. Group Relief. To the extent permitted by law (including without
limitation section 151 et. seq. of the United Kingdom Companies Act 1985), the
Buyer shall cause each member of the Company Group to (a) surrender to the
Seller or any of its Affiliates (as the Seller may specify) all such available
Group Relief as the Seller may in its sole discretion direct in writing in
respect of any Tax Period (or portion thereof) ending at or before the Closing
and (b) take all necessary steps (including, if applicable, the procuring by the
relevant member of the Company Group of the making of any consent, claim, notice
or other relevant documentation relating exclusively to the matters described in
this Section 9) requested in writing by the Seller to allow the Seller or its
Affiliates in its sole discretion to surrender any Group Relief to any member of
the Company Group, provided that the Buyer shall not be required, and shall not
be required to cause any member of the Company Group, to take any action
pursuant to this Section 9 in order to enable any member of the Company Group to
make a surrender of Group Relief or to accept a surrender of Group Relief where
it would be otherwise unlawful for it to do so. Any surrenders made pursuant to
this Section 9 shall be made for no consideration (or other cost to the Buyer,
the Company Group or any of their Affiliates), provided that if (i) the Seller
elects in writing to be compensated for a particular surrender falling within
(b) above, (ii) the Seller fully prepays (or procures prepayment of) its
liability under the last sentence of Section 1(a) in respect of the
consideration payable hereunder in respect of
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such surrender, (iii) no circumstances exist that cause the Buyer to have any
reasonable doubt that it will be entitled to retain such prepayment, (iv) the
surrender extinguishes or discharges a liability for United Kingdom corporation
tax for which the Seller is responsible under Section 1(a)(i), (v) there has
been a Determination Event, then, as consideration for such surrender, the Buyer
shall cause the relevant member of the Company Group to pay to the relevant
member of the Seller Group (on the later of date on which the Tax saved would
have become due and payable but for such surrender and the date five business
days after the date on which the written notice provided for in clause (i) was
given with respect to such surrender) an amount equal to the lesser of (A) the
corporation tax saved by the relevant member of the Company Group as a result of
such surrender and (B) the amount of such prepayment.
10. Disputes. In the case of any dispute concerning the amount of Taxes
owed by any Person, the allocation of any Tax under Section 3, the preparation
or filing of any Tax Return pursuant to Section 4, or any other computation of
Tax, refund, or credit of Taxes paid required to be made under the terms of this
Agreement, such dispute shall be resolved as follows: (a) the parties will in
good faith attempt to negotiate a mutually agreeable settlement of the dispute;
(b) if the parties are unable to negotiate a resolution of the dispute within 20
business days after one party provides written notice of the commencement of
such 20 business-day period, the parties shall submit the dispute to an
independent and internationally recognized accounting firm (or, if Seller and
Buyer do not agree on such a firm, then a firm chosen by the Arbitration and
Mediation Committee of
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the New York Society of Certified Public Accountants) (the "Tax Arbitrator") for
resolution within 20 business days after the parties have presented their
arguments to the Tax Arbitrator, which resolution shall be final, conclusive and
binding on the parties; (c) notwithstanding any other provision of this
Agreement, any payment to be made as a result of the resolution of a dispute
shall be made, and any other action to be taken as a result of the resolution of
a dispute shall be taken, on or before the later of (i) the date on which such
payment or action would otherwise be required or (ii) the third business day
following the date on which the dispute is resolved (in the case of a dispute
resolved by the Tax Arbitrator, such date being the date on which the parties
receive written notice from the Tax Arbitrator of their resolution), provided
that if a dispute with respect to an item in a Tax Return shall not be resolved
on or before the date that is three business days prior to the latest date on
which such Tax Return may be filed under applicable Tax law, then the party
having the responsibility for filing such return pursuant to this Agreement
shall file such Tax Return reflecting all disputed items that have been resolved
in the manner so resolved, and reflecting all unresolved disputed items in the
manner proposed by such party, and shall, upon the resolution of all such
unresolved disputed items, file an amended Tax Return reflecting the resolution
thereof in the manner so resolved; and (d) notwithstanding anything in this
Agreement to the contrary, the fees and expenses of the Tax Arbitrator in
resolving a dispute shall be borne equally by Seller and Buyer.
11. Termination of Tax Sharing Agreements. All tax sharing agreements,
group relief agreements or similar agreements (other than this Agreement)
between any member
23
<PAGE>
of the Company Group, on the one hand, and the Seller or any of its Affiliates
(other than any member of the Company Group), on the other hand, shall be
terminated as of the Closing Date, and there will be no further liability of the
Buyer, any of its Affiliates or any member of the Company Group under (or in
respect of anything done under) any such agreement following the Closing Date
(other than with respect to obligations that (i) will not have any cost to (and
will not have any effect on the Tax liability of) the Buyer, its Affiliates or
any member of the Company Group and (ii) are solely in respect of administrative
requirements of a relevant Tax Authority or the Seller that are intended to
ensure that the benefit of any such tax sharing or similar agreement is
preserved).
12. Limitation on Indemnity Payments. The Seller shall not be responsible
under Section 1(a)(i) for Taxes directly attributable to any action taken after
the Closing by the Buyer, any of its Affiliates or any member of Company Group
(other than an action contemplated or expressly permitted by this Agreement, the
Acquisition Agreement or the Ancillary Agreements or required by law) if such
action is taken before the end of the Closing Date. The Seller shall not be
responsible under Section 1(a)(i) for any liability to the extent such liability
is described on Schedule 12(i). The Seller shall not be liable under Section
1(a)(ii) for Taxes (to the extent described on Schedule 12(ii)) that are
attributable to any action taken after the Closing (other than an action
contemplated or expressly permitted by this Agreement, the Acquisition Agreement
or the Ancillary Agreements or required by law) by the Buyer, any of its
Affiliates or any member of Company Group if such action is described in
Schedule 12(ii). For the avoidance of doubt, the description of
24
<PAGE>
any liability on Schedule 12(i) shall not affect the Seller's liability under
Section 1(a)(ii) and the taking of any action described on Schedule 12(ii) shall
not affect the Seller's liability under Section 1(a)(i).
13.Expenses. (a) Administrative Costs. Each party and its Affiliates shall
bear their own expenses incurred in connection with preparation of Tax Returns
and other matters related to Taxes under the provisions of this Agreement.
(b) Breaches. The Seller shall bear (and shall pay, reimburse, indemnify
and hold harmless the Buyer, each member of the Company Group and their
respective Affiliates and their respective officers, directors, employees,
agents, advisers and representatives for, from and against) (in addition to any
other amounts entitled to be received) any out-of-pocket expenses and reasonable
attorneys' and accountants' fees and expenses resulting from or arising out of
any failure of the Seller to perform any covenant or agreement hereunder or
fulfill any other obligation in respect hereof. The Buyer shall bear (and shall
pay, reimburse, indemnify and hold harmless the Seller and its Affiliates and
their and their respective officers, directors, employees, agents, advisers and
representatives for, from and against) (in addition to any other amounts
entitled to be received) any out-of-pocket expenses and reasonable attorneys'
and accountants' fees and expenses resulting from or arising out of any failure
of the Buyer to perform any covenant or agreement hereunder or fulfill any other
obligation in respect hereof.
14. Survival. The rights and obligations under this Agreement with respect
to any particular Tax shall survive until six months after the expiration of any
applicable
25
<PAGE>
period of limitations on assessments with respect to such Tax, giving effect to
any waiver, mitigation, or extension thereof.
15. Definitions. All capitalized terms used but not defined in this
Agreement have the meanings specified in the Acquisition Agreement. Whenever
used in this Agreement, the following terms shall have the respective meanings
given to them below or in the Sections indicated below:
Acquisition Agreement: as defined in the recitals.
Baxendale Shares: the shares of The Baxendale Insurance Company
Limited held by Pickfords Ltd. immediately prior to the Closing.
Code: the Internal Revenue Code of 1986, as amended, and the
regulations and rules promulgated thereunder.
Corporate Restructuring Transaction: any of the following (i) any
transaction, agreement, arrangement, settlement or understanding described
in the definition of Restructuring Transaction in the Acquisition
Agreement, (ii) the transactions undertaken with respect to The Baxendale
Insurance Company Limited (and its migration) in 1997, (iii) any
transaction, agreement, arrangement, settlement or
26
<PAGE>
understanding that is not described in clause (i) or (ii) hereof but that
was primarily related to a transaction, agreement, arrangement, settlement
or understanding described in clause (i) or (ii) hereof (or to a
transaction, agreement, arrangement, settlement or understanding described
in this clause (iii)), and (iv) any other corporate restructuring
involving any member of the Company Group prior to the Closing (that was
in whole or in part either entered into on or after January 1, 1999 or was
entered into in contemplation of the transactions contemplated by the
Acquisition Agreement (or otherwise in contemplation of the disposal of
any member of the Company Group by the Seller Group), including but not
limited to (A) the formation, activation or dissolution of any entity, (B)
the transfer of any equity interest in any member of the Company Group to
any Person, (C) the transfer of all or a substantial portion of the assets
or liabilities of any member of the Company Group to any Person, and (D)
the transfer of all or a substantial portion of the assets or liabilities
of any Person to any Member of the Company Group.
Determination Event: (i) the giving of any notice by the Board of
the Inland Revenue or an officer of the Board of the Inland Revenue
pursuant to section 28A of the Taxes Management Act 1970 or (ii) the
making of any assessment by the Board of the Inland Revenue or by an
officer of the Board of the Inland Revenue pursuant to section 29 of the
Taxes Management Act 1970, in each case from which it is apparent that the
Inland Revenue intend to treat the transactions contemplated by the
Acquisition Agreement as involving a disposition by Realcause Ltd. of its
shares of the Target U.K. Subsidiary.
27
<PAGE>
Group Relief: any of the following: (i) relief surrendered or
claimed pursuant to Chapter IV Part X of the United Kingdom Income and
Corporation Taxes Act 1988, (ii) advance corporation tax surrendered or
claimed pursuant to section 240 the United Kingdom Income and Corporation
Tax Act 1988, (iii) a tax refund relating to an accounting period as
defined by section 102(3) the United Kingdom Finance Act 1989 in respect
of which a has been given pursuant to section 102(2) United Kingdom
Finance Act 1989, and (iv) any other similar provision under any nonUnited
Kingdom Tax law.
Pre-Closing Tax Period: any Tax Period ending on or before the
Closing Date and the portion of any Straddle Period ending on and
including the Closing Date.
Post-Closing Tax Period: any Tax Period beginning after the Closing
Date and the portion of any Straddle Period beginning after the Closing
Date.
Proceedings: as defined in Section 6(a).
Straddle Period: as defined in Section 2.
Taxes Act: the United Kingdom Income and Corporation Taxes Act 1988.
Tax: any tax and any governmental fee, duty, impost, levy, charge or
other assessment in the nature of tax, whether U.S. federal, state, local
or non-U.S., and any fine, penalty, addition to tax or interest connected
therewith, including without prejudice to the generality of the foregoing,
any income tax, alternative, minimum,
28
<PAGE>
accumulated earnings, personal holding company, franchise, capital,
capital stock, capital transfer, corporation tax, advance corporation tax,
national insurance and social security contributions, contributions to a
central providend fund, capital gains tax, inheritance tax, development
land tax, insurance premium tax, value added tax, and any customs tax,
profits tax, windfall profits tax, gross receipts tax, sales tax, use tax,
goods and services tax, value added tax, transfer tax, registration tax,
mortgage tax, documentary tax, stamp duty, excise and import duties, stamp
duty reserve tax, premium tax, excise tax, customs duties, severance,
environmental tax (including taxes under section 59A of the Code), real
property, personal property, ad valorem, occupancy, license, occupation,
employment, payroll, social security, disability, employer health,
unemployment, workers' compensation, withholding, estimated, installment
or other similar tax, duty, fee, assessment or other governmental charge
or deficiencies thereof.
Tax Arbitrator: as defined in Section 10.
Tax Authority: with respect to any Tax, the governmental entity or
political subdivision thereof that imposes such Tax, and the agency (if
any) charged with the collection of such Tax for such entity or
subdivision.
Tax Period: with respect to any Tax, the period for which the Tax is
reported as provided under applicable law.
Tax Return: any report of Taxes due, any claims for refund of Taxes
paid, any information return with respect to Taxes, or any other similar
report, statement, declaration, or document required to be filed,
including any attachments, exhibits, or other materials submitted with
any of the foregoing, and including any amendments or supplements to any
of the foregoing.
29
<PAGE>
TCGA 1992: the United Kingdom Taxation of Chargeable Gains Act 1992.
Treasury Regulations: the regulations prescribed under the Code.
U.K. Restructuring: the transactions described in Annex H to the
Acquisition Agreement.
U.K. Straddle Return: any Tax Return for a Straddle Period on which
the U.K. Restructuring is reported or mentioned.
U.S. Consolidated Return: any Tax Return required to be filed by a
United States federal consolidated group (or a consolidated, combined,
unitary or other similar group for a U.S. state or local purposes) that
includes both the assets and activities of any member of the Company Group
and the assets or activities of the Seller or any of its Affiliates (other
than members of the Company Group).
16. Miscellaneous.
(a) Governing Law. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS,
INCLUDING AS TO VALIDITY, INTERPRETATION AND EFFECT, BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS RULES THEREOF
(OTHER THAN SECTION 5-1411 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK). The Buyer and the Seller hereby irrevocably submit to the jurisdiction of
the courts of the State of New York and the Federal courts of the United States
of America located in the State, City and County of New York solely in respect
of the interpretation and enforcement of the provisions of this Agreement and of
the documents referred to in this Agreement, and in respect of the transactions
contemplated hereby and thereby. Each of the Buyer and the Seller irrevocably
agrees that all claims in respect of
30
<PAGE>
the interpretation and enforcement of the provisions of this Agreement and in
respect of the transactions contemplated hereby, or with respect to any such
action or proceeding, shall be heard and determined in such a New York State or
Federal court, and that such jurisdiction of such courts with respect thereto
shall be exclusive, except solely to the extent that all such courts shall
lawfully decline to exercise such jurisdiction. Each of the Buyer and the Seller
hereby waive, and agree not to assert, as a defense in any action, suit or
proceeding for the interpretation or enforcement hereof or of any such document
or in respect of any such transaction, that it is not subject to such
jurisdiction. Each of the Buyer and the Seller hereby waive, and agree not to
assert, to the maximum extent permitted by law, as a defense in any action, suit
or proceeding for the interpretation or enforcement hereof or of any such
document or in respect of any such transaction, that such action, suit or
proceeding may not be brought or is not maintainable in such courts or that the
venue thereof may not be appropriate or that this Agreement or any such document
may not be enforced in or by such courts. The Buyer and the Seller hereby
consent to and grant any such court jurisdiction over the person of such parties
and over the subject matter of any such dispute and agree that mailing of
process or other papers in connection with any such action or proceeding in the
manner provided in section 13.2 of the Acquisition Agreement or in such other
manner as may be permitted by law, shall be valid and sufficient service
thereof.
(b) Binding Effect; Sale of Logistics Business of the Seller. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective
31
<PAGE>
heirs, successors and permitted assigns. The indemnification obligations in this
Tax Matters Agreement shall be binding upon any Person that acquires all or
substantially all of the assets of the Logistics Business of the Seller, whether
by merger, amalgamation or consolidation, asset purchase, stock purchase or
subscription or otherwise, and the Seller shall not enter into any agreement for
any such transaction that does not so expressly provide.
(c) Assignment. This Agreement shall not be assignable or otherwise
transferable by any party hereto without the prior written consent of the other
parties hereto, and any purported assignment or other transfer without such
consent shall be void and unenforceable; provided, that the Buyer may assign
this Agreement to any Subsidiary of the Buyer, or to any lender to the Buyer or
any Subsidiary or Affiliate thereof as security for obligations to such lender,
and provided, further, that no assignment to any such lender shall in any way
affect the Buyer's obligations or liabilities under this Agreement.
(d) No Third Party Beneficiaries. Except as provided in Section 1 with
respect to indemnification of certain Persons hereunder, nothing in this
Agreement shall confer any rights upon any person or entity other than the
parties hereto and their respective heirs, successors and permitted assigns.
(e) Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed an original and all of which shall together
constitute one and the same instrument.
32
<PAGE>
(f) Severability. If any provision, including any phrase, sentence,
clause, section or subsection, of this Agreement is invalid, inoperative or
unenforceable for any reason, such circumstances shall not have the effect of
rendering such provision in question invalid, inoperative or unenforceable in
any other case or circumstance, or of rendering any other provision herein
contained invalid, inoperative, or unenforceable to any extent whatsoever.
(g) Amendments; Waivers, etc. No amendment, modification or discharge of
this Agreement, and no waiver hereunder, shall be valid or binding unless set
forth in writing and duly executed by the party against whom enforcement of the
amendment, modification, discharge or waiver is sought. Any such waiver shall
constitute a waiver only with respect to the specific matter described in such
writing and shall in no way impair the rights of the party granting such waiver
in any other respect or at any other time. Neither the waiver by any of the
parties hereto of a breach of or a default under any of the provisions of this
Agreement, nor the failure by any of the parties, on one or more occasions, to
enforce any of the provisions of this Agreement or to exercise any right or
privilege hereunder, shall be construed as a waiver of any other breach or
default of a similar nature, or as a waiver of any of such provisions, rights or
privileges hereunder. The rights and remedies of any party based upon, arising
out of or otherwise in respect of any covenant or agreement shall in no way be
limited by the fact that the act, omission, occurrence or other state of facts
upon which any claim of any such breach is based may
33
<PAGE>
also be the subject matter of any representation or warranty or other covenant
or agreement as to which there is no inaccuracy or breach.
(h) Headings. The headings contained in this Agreement are for purposes of
convenience only and shall not affect the meaning or interpretation of this
Agreement.
(i) Waiver of Jury Trial. Each of the parties waives any right to a trial
by jury with respect to any Litigation which arises out of, or which is related
to, the transactions contemplated by this Agreement.
[Remainder of page intentionally left blank.]
34
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective officers thereunto duly authorized as of the date
first written above.
NA Holding Corporation
By: /s/R. Barry Uber
-------------------------------------
Name: R. Barry Uber
Title: President and Chief
Executive Officer
NFC plc
By: /s/Gerry Murphy
-------------------------------------
Name: Gerry Murphy
Title: Group Chief Executive
<PAGE>
Schedule 4(h)
(A) In the case of Tax imposed by the United Kingdom of Great Britain and
Northern Ireland or any political subdivision thereof:
o The claiming and use of Capital Allowances or Industrial Buildings
Allowances under the Capital Allowances Act 1990 ("CAA 1990") or the
Income and Corporation Taxes Act 1988 ("ICTA 1988")
o Claim for error or mistake pursuant to TMA 1970, s.33(1)
o Capital allowances for plant and machinery connected with premises
giving rise to Schedule A income pursuant to ICTA 1988, s.32(5)
o Sums received after trade discontinued treated as received on last
day of trade pursuant to ICTA 1988, s. 108
o Carry-back of ACT pursuant to ICTA 1988, s.239(3)
o Surrender of ACT pursuant to ICTA 1988, s.240(1), (6), (14)
o Payment of intra-group dividends without ACT and charges on income
gross pursuant to ICTA 1988, s.247, 248
o Carry-forward of trading losses (a) for accounting periods ending
after 30 September 1993 (under Pay and File) and (b) for accounting
periods ending before 1 October 1993 pursuant to ICTA 1988,
s.393(1), (11)
o Set-off of trading losses against profits of the same, or on
earlier, accounting period ICTA 1988, s. 393A(1), (10) and formerly
s. 393(1), (11)
o Set-off/carry-forward of Schedule D, Case VI losses pursuant to ICTA
1988, s. 396(1), (3)
o Group relief (a) where claimant company's accounting period ends
after 30 September 1993 (under Pay and File) (b) where claimant
company's accounting period ends before 1 October 1993 pursuant to
ICTA 1988, s. 412, Schedule 17A, (para. 2)
o Unremittable overseas income pursuant to ICTA 1988, s. 584(2),(6)
o Credit for foreign taxes general pursuant to ICTA 1988, s. 804(1),
(7), 806(1)
o Disapplication of claim or election in relation to controlled
foreign companies' corresponding UK tax pursuant to ICTA 1988,
Schedule 24, para. 4(2)
o Relief on disposal of shares in controlled foreign company pursuant
to ICTA 1988, Schedule 26, para. 3 (1), (6)
o Surrender of company tax refund within group (for accounting periods
ending after 30 September 1993 under the Pay and File regime)
pursuant to FA 1989, s. 102(2)
o Entitlement to IBAs as between lessor and lessee in the case of a
long lease pursuant to CAA 1990, s. 11(1), (3)
o Disclaimer of writing down allowances on plant and machinery for
accounting periods ending before 1 October 1993 pursuant to CAA
1990, s. 24(4)
<PAGE>
Schedule 4(h) Continued
o Certain plant and machinery treated as "short-life" assets pursuant
to CAA 1990, s. 37(1), 37(2)
o Transfer of short life assets to connected person at tax-written
down value pursuant to CAA 1990, s. 37(8)
o Allocation of capital allowances on certain fixtures between lessor
and lessee pursuant to CAA 1990, s. 53(1), (2)
o Allocation of capital allowances on certain fixtures between lessor
and incoming lessee pursuant to CAA 1990, s. 55(1),(3)
o Apportionment of expenditure on fixtures attached to land pursuant
to CAA 1990, s. 59B
o Transfer of trade between connected parties: certain assets,
eligible for capital allowances, transfer at tax written-down value
pursuant to CAA 1990, s. 77(3), (4)
o Events treated as balancing events pursuant to CAA 1990, s. 129
o Set-off of capital allowances given by discharge or repayment
pursuant to CAA 1990, s. 145(3), (5)
o Transfer between connected parties of certain assets, eligible for
capital allowances, at tax-written down value pursuant to CAA 1990,
2. 158(1)
o Value of asset negligible pursuant to TCGA 1992, s. 24
o Earn-out rights to be treated as securities for purposes of TCGA
1992, s. 135 pursuant to TCGA 1992, s. 138A
o Replacement of business assets (roll-over relief) pursuant to TCGA
1992, s. 152(1)
o Adjustment of base cost for small part disposal of land pursuant to
TCGA 1992, s. 242(2)
o Adjustment of base cost for part disposal of land to authority with
compulsory powers pursuant to TCGA 1992, s. 243(2)
o Roll-over relief on compulsory acquisition of land pursuant to TCGA
1992, s. 247(2)
o Irrecoverable loan to a trader pursuant to TCGA 1992, s. 253(3)
o Relief for deferred charges on gains before 31 March 1982 - TCGA
1992, Schedule 4, para. 9(1)
o Relief for non-trading exchange losses pursuant to FA 1993, s.
131(3), (4), (14)
o Claim to defer unrealised exchange gains pursuant to FA 1993, s.
139(3), (6), (7)
o Notification of expenditure on plant and machinery on which capital
allowances to be claimed pursuant to FA 1994, s. 118(3)
2
<PAGE>
Schedule 4(h) Continued
o Relief for non-trading deficit on loan relationships against any
profits of deficit period, as group relief or by carry back pursuant
to FA 1996, s. 83(2)(a)(b)(c), (6), (7)(a)
o Relief for non-trading deficit on loan relationships by carry
forward against non- trading credits of the immediately following
accounting period pursuant to FA 1996, s. 83(2)(d), (6), (7)(b).
(B) In the case of Tax imposed by any jurisdiction other than (i) the United
Kingdom of Great Britain and Northern Ireland or any political subdivision
thereof or (ii) the United States of America or any political subdivision
thereof, including without limitation any states, territories and
commonwealths thereof and the District of Columbia:
o Any claim, disclaimers, surrender, indices, election or other
documentation that is actually necessary to preserve a Tax position
previously taken on (i) a Tax Return actually filed on or prior to
the Closing Date and described in Section 4(a)(i) or (ii) a Tax
Return actually filed after the Closing Date pursuant to Section
4(b).
3
<PAGE>
Schedule 12(i)
Limitations on Section 1(a)(i) (Pre-Closing Taxes)
1. Untaxed Pre-Closing Appreciation. For the avoidance of doubt, to the
extent the liability (i) results from any action by the Buyer, its
Affiliates or any member of the Company Group taken after Closing that
results in a disposal or deemed disposal of any asset (other than trade
stock) by a member of the Company Group and (ii) is imposed on untaxed
appreciation or gain that (A) had accrued in such asset prior to the time
of the Closing and (B) was not required to be included in taxable income
for the purpose of the particular type of Tax involved (and was not
otherwise subject to such Tax) for any Pre-Closing Tax Period.
2. Depreciation Recaptured After the Closing. For the avoidance of doubt, to
the extent that the liability (i) results from any action by the Buyer,
its Affiliates or any member of the Company Group taken after Closing that
results in a disposal or deemed disposal by a member of the Company Group
of any capital asset in respect of the expenditure on which capital
allowances have been claimed and (ii) is in respect of a resulting
balancing charge for capital allowance purposes being crystalized in
respect of such asset for U.K. Tax purposes (or has a similar effect under
the laws of any non-U.K. jurisdiction).
3. Recognition After the Closing of Rolled-Over Gain. For the avoidance of
doubt, to the extent that the liability (i) results from any action by the
Buyer, its Affiliates or any member of the Company Group taken after
Closing that results in a disposal or deemed disposal of any asset (other
than trade stock) by a member of the Company Group and (ii) is
attributable to a claim that has been made under section 152/153/154 TCGA
1992.
4. Transfer Pricing. To the extent that the liability (i) is in respect of a
transfer pricing issue and (ii) results from the Buyer entering into a
settlement or agreement of a Proceeding for a Pre-Closing Tax Period in
violation of Section 6 hereof.
5. Transfer Taxes. The liability of the Buying Group and the Company Group
described in section 13.1(b) of the Acquisition Agreement.
<PAGE>
Schedule 12(ii)
Limitations on Section 1(a)(ii)
Any action taken after the Closing by the Buyer or its Affiliates or any member
of the Company Group without the consent of the Seller or any of its Affiliates
that directly causes a chargeable gain to accrue to Pickfords 1999 Ltd. pursuant
to either Section 187(3) or (4) TCGA 1992 provided that this paragraph shall
only apply to limit the liability of the Seller pursuant to Section 1(a)(ii) in
relation to United Kingdom tax on chargeable gains pursuant to a section 187
TCGA 1992 and calculated by reference to any postponed gain (as defined in
section 187(2) TCGA 1992) in relation to The Baxendale Insurance Company Limited
having ceased to be resident in the United Kingdom for United Kingdom tax
purposes prior to Closing.
<PAGE>
EXHIBIT 10.17
AMENDMENT NO. 1 TO CONSULTING AGREEMENT
AMENDMENT NO. 1, dated as of April 1, 1998, to the CONSULTING
AGREEMENT, dated as of March 30, 1998, by and among NA Holding Corporation, a
Delaware corporation ("HOLDING"), NA Acquisition Corporation, a Delaware
corporation and wholly-owned subsidiary of Holding ("NA ACQUISITION"), and North
American Van Lines, Inc. a Delaware corporation and wholly owned subsidiary of
Holding (the "COMPANY") and Clayton, Dubilier & Rice, Inc., a Delaware
corporation ("CD&R").
W I T N E S S E T H:
WHEREAS, the parties hereto have entered into a Consulting
Agreement, dated as of March 30, 1998 (the "Consulting Agreement");
WHEREAS, NA Acquisition has been merged with and into the
Company, with the Company as the surviving corporation and a direct wholly owned
subsidiary of Holding; and
WHEREAS, the parties hereto wish to amend certain provisions
of the Consulting Agreement and to set forth the parties' agreement with respect
to certain waivers of certain provisions of the Consulting Agreement as herein
provided;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements set forth herein, the parties hereto hereby
agree as follows:
1. AMENDMENT TO SECTION 3. Section 3(b) of the Consulting
Agreement is hereby amended to read in its entirety as follows:
(b) The Acquisition Group jointly and severally agree to pay
to CD&R, as compensation for Continuing Services rendered and to be rendered by
CD&R hereunder, a fee of $400,000 per year (the "CONTINUING SERVICES FEE"),
one-twelfth of which shall be payable on the first day of each month commencing
on the first day of the month following the date of the closing of the
Acquisition. Such Continuing Services Fee may, in the sole discretion of a
majority of the members of the Company's Board of Directors who are not
affiliated with CD&R, be increased but may not be decreased without the prior
written consent of CD&R. If any employee of CD&R shall be elected to serve on
the Board of Directors of any member of the Acquisition Group or any of their
affiliates (a "DESIGNATED DIRECTOR"), in consideration of the Continuing
Services Fee being paid to CD&R, CD&R shall cause such Designated Director to
waive any and all fees to which such director
<PAGE>
would otherwise be entitled as a director for any period for which the Fee or
any installment thereof is paid.
2. CONFIRMATION OF CONSULTING AGREEMENT. Except as set forth
in this Amendment, hereof, the Consulting Agreement is in all respects hereby
ratified and confirmed and shall continue in full force and effect as amended
hereby.
3. MISCELLANEOUS. This Amendment may be executed in several
counterparts, each of which shall be deemed an original and all of which shall
together constitute one and the same instrument. This Amendment shall in all
respects be construed in accordance with and governed by the substantive laws of
the State of New York without regard to conflict of laws principles.
2
<PAGE>
IN WITNESS WHEREOF, the parties have duly executed this
Amendment as of the date first above written.
CLAYTON, DUBILIER & RICE, INC.
By: /s/ Joseph L. Rice, III
-----------------------------
Name: Joseph L. Rice, III
Title: Chairman
NA HOLDING CORPORATION
By: /s/ R. Barry Uber
------------------------------
Name: R. Barry Uber
Title: President and Chief
Executive Officer
NORTH AMERICAN VAN LINES, INC.
By: /s/ R. Barry Uber
-----------------------------
Name: R. Barry Uber
Title: President and Chief
Executive Officer
3
<PAGE>
Exhibit 12.1
NORTH AMERICAN VAN LINES
CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES
--------------------------------------------------
(Dollars in thousands)
<TABLE>
<CAPTION>
Nine-Month
Three-Month Period from
Period from March 29, 1998
Year ended Year ended Year ended Year ended December 28, through
December 31, December 31, December 31, December 31, 1997 through December 26,
1994 1995 1996 1997 March 28, 1998 1998
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Income/(loss) from operations 22,115 18,402 28,067 31,163 (1,335) 11,567
Other income/(expense) -- -- -- -- 10 147
------------ ------------ ------------ ------------ ------------- -------------
22,115 18,402 28,067 31,163 (1,325) 11,714
Interest expense 5,606 2,268 1,768 602 -- 11,758
Interest component of
operating leases 3,166 2,946 3,306 4,115 1,352 4,149
------------ ------------ ------------ ------------ ------------- -------------
8,772 5,214 5,074 4,717 1,352 15,907
Ratio 2.52 3.53 5.53 6.61 * 0.74
------------ ------------ ------------ ------------ ------------- -------------
------------ ------------ ------------ ------------ ------------- -------------
</TABLE>
<TABLE>
<CAPTION>
Six-Month
Three-Month Period from
Period from March 29, Nine Months
December 28, 1998 through Ended
1997 through September 26, September 25,
March 28, 1998 1998 1999
--------------------------------------------------
<S> <C> <C> <C>
Income/(loss) from operations (1,335) 11,010 2,898
Other income/(expense) 10 139 (7)
------------- ------------ -------------
(1,325) 11,149 2,891
Interest expense -- 8,069 12,395
Interest component of
operating leases 1,352 3,624 6,209
------------- ------------ -------------
1,352 11,713 18,604
Ratio * 0.95 0.16
------------- ------------ -------------
------------- ------------ -------------
</TABLE>
* For the three month period ended March 28, 1998, earnings were insufficient
to cover fixed charges by $2,677.
<PAGE>
ALLIED
CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES
-------------------------------------------------
(Pounds in millions)
<TABLE>
<CAPTION>
Nine Months Nine Months
Year ended Year ended Year ended Ended Ended
September 30, September 30, September 30, June 30, June 30,
1996 1997 1998 1998 1999
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Income/(loss) from operations 18.7 21.3 26.1 13.7 13.8
Other income/(expense) -- -- -- -- --
------------ ------------- ------------- ------------ -----------
18.7 21.3 26.1 13.7 13.8
Interest expense 0.7 2.2 -- -- 0.3
Interest component of
operating leases 3.5 3.2 3.5 2.6 3.3
------------ ------------- ------------- ------------ -----------
4.2 5.4 3.5 2.6 3.6
Ratio 4.45 3.94 7.46 5.22 3.83
------------ ------------- ------------- ------------ -----------
------------ ------------- ------------- ------------ -----------
</TABLE>
<PAGE>
PRICEWATERHOUSECOOPERS [LOGO] Exhibit 15.1
- --------------------------------------------------------------------------
PricewaterhouseCoopers LLP
200 E. Randolph Dr.
Chicago, IL 60601
Telephone: (312) 565 1500
February 4, 2000
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Commissioners:
We are aware that our reported dated November 12, 1999, except as to Note 6
and Note 8, for which the date is January 31, 2000, on our review of interim
financial information of North American Van Lines, Inc. for the period
December 27, 1998 through September 25, 1999 is included in its Registration
Statement dated February 4, 2000.
Yours very truly,
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCooopers LLP
<PAGE>
[LOGO] ERNST & YOUNG
Exhibit 15.2
3 February, 2000
The Board of Directors,
NFC plc
66 Chilton Street
London W1M 2L7
We are aware of the inclusion in the Registration Statement (Form S-4) of
North American Van Lines, Inc. for the registration of $150,000,000 of its
13 3/8% Senior Subordinated Noted Due 2009 of our report dated September 20,
1999 relating to the unaudited condensed combined interim financial statements
of NFC Moving Services Group.
Yours faithfully
/s/ Ernst and Young
- ----------------------
Ernst & Young
<PAGE>
Exhibit 21.1
<TABLE>
<CAPTION>
Jurisdiction of
Subsidiary Organization
- ---------- ------------
<S> <C>
A Five Star Forwarding, Inc. Delaware
A Relocation Solutions Management Company Delaware
A Three Rivers Forwarding, Inc. Indiana
A.L. Movers Private Ltd India
A.V.L. Transportation, Inc. Delaware
A-1 Above Van Lines, Inc. Indiana
A-1 Summit Van Lines, Inc. Indiana
A&N Removals Ltd England & Wales
Able Van Lines, Inc. Indiana
Alaska USA Van Lines, Inc. Indiana
Allied Alliance Forwarding, Inc Delaware
Allied Arthur Pierre NV Belgium
Allied Arthur Pierre SA France
Allied Arthur Pierre SA Luxembourg
Allied Continental Forwarding, Inc. Delaware
Allied Domestic Forwarding, Inc. Delaware
Allied Freight Forwarding, Inc. Delaware
Allied Intermodal Forwarding, Inc. Delaware
Allied International N.A., Inc. Delaware
Allied International SA Spain
Allied Interstate Transportation, Inc. Delaware
Allied Mobility Transportation, Inc. Delaware
Allied Pickfords (M) Sdn Bhd Malaysia
Allied Pickfords (S) Pte Ltd Singapore
Allied Pickfords BV Netherlands
Allied Pickfords KeS Kft Hungary
Allied Pickfords LLC United Arab Emirates
Allied Pickfords Ltd England & Wales
Allied Pickfords Ltd Hong Kong
Allied Pickfords Ltd Ireland
Allied Pickfords Ltd New Zealand
Allied Pickfords Pty Ltd Australia
Allied Pickfords SP ZOO Poland
Allied Pickfords SRO Czech Republic
Allied Transcontinental Forwarding, Inc. Delaware
Allied Transportation Forwarding, Inc. Delaware
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Allied Universal Transportation, Inc. Delaware
Allied Van Lines, Inc. Delaware
Allied Van Lines, Inc. of Indiana Indiana
Allied Van Lines Terminal Company Delaware
Allied Varekamp BV The Netherlands
ALNAV Platinum Group Inc. Canada
Americas Best Van Lines, Inc. Indiana
Americas Quality Van Lines, Inc. Indiana
Arthur Pierre (UK) Ltd England & Wales
AWG Australasia Superannuation Pty Ltd Australia
AWG International Holdings (Australasia) Pty Ltd Australia
AWG Investment Asia Pacific Pte Ltd Singapore
AWG New Zealand Ltd New Zealand
Bullens Ltd England & Wales
City Storage & Transfer, Inc. Colorado
ClaimGuard, Inc. Delaware
Downard Pickfords (North Queensland) Pty Ltd Australia
Fleet Insurance Management, Inc. Indiana
Frontrunner Worldwide, Inc. Delaware
GB Crate Hire Ltd England & Wales
Great Falls North American, Inc. Montana
Hoults Removals Ltd England & Wales
Imaging Systems (NZ) Ltd New Zealand
Irish Security Archives Ltd Ireland
Irish Security Archives Ltd Northern Ireland
Manufacturing Support Services, LLC (51%) Delaware
Meridian Mobility Resources, Inc. Delaware
MidiData Logistik GmbH Germany
MidiData Spedition GmbH Germany
Move Management Services, Inc. Indiana
Moving Services Property Ltd England & Wales
NA (UK) GP Corporation Delaware
NA (UK) Limited Partnership England & Wales
NA Acquisition Ireland
NA Acquisition (UK) Limited England & Wales
NA Moving Services Ltd England & Wales
NACAL, Inc. California
NAVTRANS Container Lines, Inc. Florida
</TABLE>
<PAGE>
<TABLE>
<S> <C>
NAVTRANS International Freight Forwarding, Inc. Indiana
NAVTRANS International Speditions GmbH Germany
Noram Forwarding, Inc. Indiana
North American (U.K.) Ltd England
North American Distribution Systems, Inc. Indiana
North American Forwarding, Inc. Indiana
North American International Holding Corporation Delaware
North American Logistics, Ltd. Indiana
North American Moving & Storage, Inc. Indiana
North American Transport Insurance Company Indiana
North American Van Lines of Texas, Inc. Texas
Pickfords 1999 Limited England & Wales
Pickfords Ltd England & Wales
Pickfords Ltd Hong Kong
Pickfords Manhire Ltd England & Wales
Pickfords Worldwide Moving Ltd. Hong Kong
Pierre Finance (Nederland) Renting BV The Netherlands
Pitt & Scott Ltd England & Wales
Relocation Management Systems, Inc. Delaware
Removedeal Ltd England & Wales
The Baxendale Insurance Company Ltd. Ireland
Trans International Living & Shipping Pty Ltd Australia
Trans International Moving & Shipping (NZ) 1992 Ltd New Zealand
Transguard Insurance Company of America, Inc. Illinois
TransGuard General Agency, Inc. Oklahoma
Trident Transport International, Inc. Delaware
Vanguard Insurance Agency, Inc. Illinois
World Class Van Lines, Inc. Delaware
</TABLE>
<PAGE>
Exhibit 23.2
PRICEWATERHOUSECOOPERS [LOGO]
- --------------------------------------------------------------------------
PricewaterhouseCoopers LLP
200 E. Randolph Dr.
Chicago, IL 60601
Telephone: (312) 565 1500
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the use in this Registration Statement on Form S-4 of
North American Van Lines, Inc. of our report dated February 4, 1999, except
as to Note 17, for which the date is September 27, 1999, and Note 18, for which
the date is January 31, 2000 and our report dated March 18, 1999, except as
to Note 16, for which the date is September 27, 1999, and Note 17, for which
the date is January 31, 2000, relating to the financial statements of North
American Van Lines, Inc., which appear in such Registration Statement. We
also consent to the references to us under the heading "Experts" in such
Registration Statement.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Chicago, IL
February 4, 2000
<PAGE>
Exhibit 23.3
KPMG [LOGO]
The Board of Directors
North American Van Lines, Inc.:
We consent to the use of our report dated January 21, 1998, except as to Note
17, for which the date is November 19, 1999, included herein and to the
reference to our firm under the heading "Experts" in the prospectus.
/s/ KPMG LLP
Norfolk, Virginia
February 4, 2000
<PAGE>
[LOGO] ERNST & YOUNG
Exhibit 23.4
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" and
to the use of report dated September 20, 1999, on the combined financial
statements of NFC Moving Services Group as at September 30, 1998 and 1997 and
for each of the three years in the period ended September 30, 1998 in the
Registration Statement (Form S-4) and related Prospectus of North American
Van Lines, Inc. for the registration of $150,000,000 of its 13 3/8% Senior
Subordinated Notes Due 2009.
/s/ Ernst & Young
London, England
February 4, 2000
<PAGE>
Exhibit 25.1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
---------
STATEMENT OF ELIGIBILITY UNDER THE
TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)
STATE STREET BANK AND TRUST COMPANY
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
Massachusetts 04-1867445
(JURISDICTION OF INCORPORATION OR (I.R.S. EMPLOYER
ORGANIZATION IF NOT A U.S. NATIONAL BANK) IDENTIFICATION NO.)
225 Franklin Street, Boston, Massachusetts 02110
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Maureen Scannell Bateman, Esq. Executive Vice President and General Counsel
225 Franklin Street, Boston, Massachusetts 02110
(617) 654-3253
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
NORTH AMERICAN VAN LINES, INC.
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE 52-184089
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
5001 U. S. HWY. 30 WEST
FORT WAYNE, INDIANA 46818
(Address of principal executive offices) (Zip Code)
13 3/8 % SENIOR SUBORDINATED NOTES
(TITLE OF INDENTURE SECURITIES)
<PAGE>
GENERAL
ITEM 1. GENERAL INFORMATION.
FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISORY AUTHORITY TO
WHICH IT IS SUBJECT.
Department of Banking and Insurance of The Commonwealth of
Massachusetts, 100 Cambridge Street, Boston, Massachusetts.
Board of Governors of the Federal Reserve System, Washington,
D.C., Federal Deposit Insurance Corporation, Washington, D.C.
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
The obligor is not an affiliate of the trustee or of its
parent, State Street Corporation.
(See note on page 2.)
ITEM 3. THROUGH ITEM 15. NOT APPLICABLE.
ITEM 16. LIST OF EXHIBITS.
LIST BELOW ALL EXHIBITS FILED AS PART OF THIS STATEMENT OF ELIGIBILITY.
1. A COPY OF THE ARTICLES OF ASSOCIATION OF THE TRUSTEE AS NOW IN
EFFECT.
A copy of the Articles of Association of the trustee, as
now in effect, is on file with the Securities and Exchange
Commission as Exhibit 1 to Amendment No. 1 to the Statement of
Eligibility and Qualification of Trustee (Form T-1) filed with the
Registration Statement of Morse Shoe, Inc. (File No. 22-17940) and is
incorporated herein by reference thereto.
2. A COPY OF THE CERTIFICATE OF AUTHORITY OF THE TRUSTEE TO COMMENCE
BUSINESS, IF NOT CONTAINED IN THE ARTICLES OF ASSOCIATION.
A copy of a Statement from the Commissioner of Banks of
Massachusetts that no certificate of authority for the trustee to
commence business was necessary or issued is on file with the
Securities and Exchange Commission as Exhibit 2 to Amendment No. 1
to the Statement of Eligibility and Qualification of Trustee
(Form T-1) filed with the Registration Statement of Morse Shoe, Inc.
(File No. 22-17940) and is incorporated herein by reference thereto.
3. A COPY OF THE AUTHORIZATION OF THE TRUSTEE TO EXERCISE CORPORATE
TRUST POWERS, IF SUCH AUTHORIZATION IS NOT CONTAINED IN THE DOCUMENTS
SPECIFIED IN PARAGRAPH (1) OR (2), ABOVE.
A copy of the authorization of the trustee to exercise
corporate trust powers is on file with the Securities and
Exchange Commission as Exhibit 3 to Amendment No. 1 to the
Statement of Eligibility and Qualification of Trustee (Form
T-1) filed with the Registration Statement of Morse Shoe, Inc.
(File No. 22-17940) and is incorporated herein by reference
thereto.
4. A COPY OF THE EXISTING BY-LAWS OF THE TRUSTEE, OR INSTRUMENTS
CORRESPONDING THERETO.
A copy of the by-laws of the trustee, as now in effect, is on
file with the Securities and Exchange Commission as Exhibit 4
to the Statement of Eligibility and Qualification of Trustee
(Form T-1) filed with the Registration Statement of Eastern
Edison Company (File No. 33-37823) and is incorporated herein
by reference thereto.
1
<PAGE>
5. A COPY OF EACH INDENTURE REFERRED TO IN ITEM 4. IF THE OBLIGOR IS IN
DEFAULT.
Not applicable.
6. THE CONSENTS OF UNITED STATES INSTITUTIONAL TRUSTEES REQUIRED BY
SECTION 321(b) OF THE ACT.
The consent of the trustee required by Section 321(b) of the
Act is annexed hereto as Exhibit 6 and made a part hereof.
7. A COPY OF THE LATEST REPORT OF CONDITION OF THE TRUSTEE PUBLISHED
PURSUANT TO LAW OR THE REQUIREMENTS OF ITS SUPERVISING OR EXAMINING AUTHORITY.
A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority is annexed hereto as
Exhibit 7 and made a part hereof.
NOTES
In answering any item of this Statement of Eligibility which relates to
matters peculiarly within the knowledge of the obligor or any underwriter for
the obligor, the trustee has relied upon information furnished to it by the
obligor and the underwriters, and the trustee disclaims responsibility for the
accuracy or completeness of such information.
The answer furnished to Item 2. of this statement will be amended, if
necessary, to reflect any facts which differ from those stated and which would
have been required to be stated if known at the date hereof.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, State Street Bank and Trust Company, a corporation
organized and existing under the laws of The Commonwealth of Massachusetts,
has duly caused this statement of eligibility to be signed on its behalf by
the undersigned, thereunto duly authorized, all in the City of Boston and The
Commonwealth of Massachusetts, on the 24TH DAY OF JANUARY, 2000.
STATE STREET BANK AND TRUST COMPANY
By: /s/ Earl W. Dennison Jr.
------------------------
EARL W. DENNISON JR.
VICE PRESIDENT
2
<PAGE>
EXHIBIT 6
CONSENT OF THE TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust Indenture
Act of 1939, as amended, in connection with the proposed issuance by NORTH
AMERICAN VAN LINES, INC. of its 13 3/8 % SENIOR SUBORDINATED NOTES, we hereby
consent that reports of examination by Federal, State, Territorial or District
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon request therefor.
STATE STREET BANK AND TRUST COMPANY
By: /s/ Earl W. Dennison Jr.
------------------------
EARL W. DENNISON JR.
VICE PRESIDENT
DATED: JANUARY 24, 2000
3
<PAGE>
EXHIBIT 7
Consolidated Report of Condition of State Street Bank and Trust Company,
Massachusetts and foreign and domestic subsidiaries, a state banking institution
organized and operating under the banking laws of this commonwealth and a member
of the Federal Reserve System, at the close of business SEPTEMBER 30, 1999,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act and in accordance
with a call made by the Commissioner of Banks under General Laws, Chapter 172,
Section 22(a).
<TABLE>
<CAPTION>
Thousands of
ASSETS Dollars
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin ......................................... 1,510,845
Interest-bearing balances .................................................................. 14,076,224
Securities .......................................................................................... 14,318,348
Federal funds sold and securities purchased
under agreements to resell in domestic offices
of the bank and its Edge subsidiary ........................................................ 8,365,790
Loans and lease financing receivables:
Loans and leases, net of unearned income ................................................... 7,916,057
Allowance for loan and lease losses ........................................................ 92,091
Allocated transfer risk reserve............................................................. 0
Loans and leases, net of unearned income and allowances .................................... 7,823,966
Assets held in trading accounts ..................................................................... 1,739,144
Premises and fixed assets ........................................................................... 531,098
Other real estate owned ............................................................................. 0
Investments in unconsolidated subsidiaries .......................................................... 603
Customers' liability to this bank on acceptances outstanding ........................................ 125,222
Intangible assets ................................................................................... 236,931
Other assets ........................................................................................ 1,468,218
-------------
Total assets ........................................................................................ 50,196,389
=============
LIABILITIES
Deposits:
In domestic offices ........................................................................ 10,235,475
Noninterest-bearing ............................................................... 7,515,809
Interest-bearing .................................................................. 2,719,666
In foreign offices and Edge subsidiary ..................................................... 21,827,096
Noninterest-bearing ............................................................... 47,540
Interest-bearing .................................................................. 21,779,556
Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of
the bank and of its Edge subsidiary ........................................................ 11,976,613
Demand notes issued to the U.S. Treasury............................................................. 431,057
Trading liabilities................................................................. 1,250,459
Other borrowed money ................................................................................ 180,568
Subordinated notes and debentures ................................................................... 0
Bank's liability on acceptances executed and outstanding ............................................ 125,222
Other liabilities ................................................................................... 1,313,563
Total liabilities ................................................................................... 47,340,053
-------------
EQUITY CAPITAL
Perpetual preferred stock and related surplus ....................................................... 0
Common stock ........................................................................................ 29,931
Surplus ............................................................................................. 492,756
Undivided profits and capital reserves/Net unrealized holding gains (losses) ........................ 2,373,416
Net unrealized holding gains (losses) on available-for-sale securities.............. (35,467)
Cumulative foreign currency translation adjustments ................................................. (4,300)
Total equity capital ................................................................................ 2,856,336
-------------
Total liabilities and equity capital ................................................................ 50,196,389
-------------
</TABLE>
4
<PAGE>
I, Rex S. Schuette, Senior Vice President and Comptroller of the above named
bank do hereby declare that this Report of Condition has been prepared in
conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Rex S. Schuette
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
David A. Spina
Marshall N. Carter
Truman S. Casner
5
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<CIK> 0001103280
<NAME> North American Van Lines, Inc.
<S> <C> <C> <C>
<PERIOD-TYPE> 9-MOS 9-MOS 3-MOS
<FISCAL-YEAR-END> DEC-31-1999 DEC-26-1998 DEC-26-1998
<PERIOD-START> DEC-27-1998 MAR-29-1998 DEC-28-1997
<PERIOD-END> SEP-25-1999 DEC-26-1998 MAR-28-1998
<CASH> 1,228 2,074 9,227
<SECURITIES> 0 0 0
<RECEIVABLES> 172,868 139,053 151,513
<ALLOWANCES> 3,998 1,128 12,469
<INVENTORY> 0 0 0
<CURRENT-ASSETS> 216,884 180,293 188,205
<PP&E> 93,812 91,795 181,287
<DEPRECIATION> 34,725 18,194 124,933
<TOTAL-ASSETS> 412,878 392,063 284,314
<CURRENT-LIABILITIES> 188,457 148,888 124,958
<BONDS> 135,447 140,021 520
0 0 0
0 0 1,000
<COMMON> 0 0 10
<OTHER-SE> 56,835 63,650 99,972
<TOTAL-LIABILITY-AND-EQUITY> 412,878 392,063 284,314
<SALES> 0 0 0
<TOTAL-REVENUES> 771,237 759,207 207,245
<CGS> 607,608 593,979 162,381
<TOTAL-COSTS> 768,339 747,640 208,580
<OTHER-EXPENSES> 0 0 0
<LOSS-PROVISION> 0 0 0
<INTEREST-EXPENSE> 12,395 11,758 0
<INCOME-PRETAX> (9,683) (101) (1,098)
<INCOME-TAX> (2,752) 1,111 (448)
<INCOME-CONTINUING> 0 0 0
<DISCONTINUED> 0 0 0
<EXTRAORDINARY> 0 0 0
<CHANGES> 0 0 0
<NET-INCOME> (6,931) (1,212) (650)
<EPS-BASIC> 0 0 0
<EPS-DILUTED> 0 0 0
</TABLE>
