Document:

Exhibit 4.28

 

EXECUTION COPY

 

 

NOTE PURCHASE AGREEMENT

 

 

Dated as of October 14, 2003

 

by and among

 

Vanguard Car Rental USA Inc.,

 

Alamo Rental (US) Inc.,

 

National Rental (US) Inc.

 

as Companies

 

Vanguard Car Rental USA Holdings Inc.

 

as Guarantor,

 

the Purchasers herein

 

and

 

Madeleine L.L.C.

 

as Administrative Agent and Collateral Agent

 

14% Secured Senior Subordinated Notes due March 30,
2008

 

 

 

TABLE OF CONTENTS

 

	
   

  	
  Page

  
	
   

  	
   

  
	
  1.

  	
  AUTHORIZATION
  OF NOTES

  	
  1

  
	
   

  	
   

  	
   

  
	
  2.

  	
  SALE
  AND PURCHASE OF NOTES

  	
  1

  
	
   

  	
  2.1.

  	
  Obligation
  to Purchase

  	
  1

  
	
   

  	
  2.2.

  	
  Notice
  of Purchase

  	
  2

  
	
   

  	
  2.3.

  	
  Closing

  	
  2

  
	
   

  	
  2.4.

  	
  Interest

  	
  2

  
	
   

  	
  2.5.

  	
  Fees

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  PAYMENTS;
  NATURE OF COMPANIES’ OBLIGATIONS

  	
  3

  
	
   

  	
  3.1.

  	
  Payments
  and Computations

  	
  3

  
	
   

  	
  3.2.

  	
  Sharing
  of Payments, Etc

  	
  3

  
	
   

  	
  3.3.

  	
  Apportionment
  of Payments

  	
  4

  
	
   

  	
  3.4.

  	
  Joint
  and Several Liability of the Companies

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  CONDITIONS
  TO THE PURCHASE

  	
  5

  
	
   

  	
  4.1.

  	
  Documents
  Required

  	
  5

  
	
   

  	
  4.2.

  	
  The
  Sale Order

  	
  8

  
	
   

  	
  4.3.

  	
  The
  Acquisition

  	
  8

  
	
   

  	
  4.4.

  	
  Capitalization

  	
  8

  
	
   

  	
  4.5.

  	
  Insurance
  and Surety Bonding Requirements

  	
  9

  
	
   

  	
  4.6.

  	
  Information
  Technology

  	
  9

  
	
   

  	
  4.7.

  	
  Payment
  of Accrued Fees and Expenses

  	
  9

  
	
   

  	
  4.8.

  	
  Representations
  and Warranties

  	
  9

  
	
   

  	
  4.9.

  	
  No
  Default

  	
  9

  
	
   

  	
  4.10.

  	
  Purchase
  Permitted by Applicable Requirements of Law, Etc

  	
  9

  
	
   

  	
  4.11.

  	
  Consents
  and Approvals

  	
  9

  
	
   

  	
  4.12.

  	
  No
  Litigation or Other Proceedings

  	
  9

  
	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  REPRESENTATIONS
  AND WARRANTIES OF THE CREDIT PARTIES

  	
  10

  
	
   

  	
  5.1.

  	
  Organization,
  Good Standing, Etc

  	
  10

  
	
   

  	
  5.2.

  	
  Authorization,
  Etc

  	
  10

  
	
   

  	
  5.3.

  	
  Governmental
  Approvals

  	
  10

  
	
   

  	
  5.4.

  	
  Enforceability
  of Note Documents

  	
  10

  
	
   

  	
  5.5.

  	
  Subsidiaries

  	
  10

  
	
   

  	
  5.6.

  	
  Litigation

  	
  11

  
	
   

  	
  5.7.

  	
  Financial
  Condition

  	
  11

  
	
   

  	
  5.8.

  	
  Compliance
  with Law, Etc

  	
  11

  
	
   

  	
  5.9.

  	
  ERISA

  	
  11

  
	
   

  	
  5.10.

  	
  Health
  Benefits; WARN

  	
  12

  
	
   

  	
  5.11.

  	
  Taxes,
  Etc

  	
  12

  
	
   

  	
  5.12.

  	
  Use
  of Proceeds; Margin Regulations

  	
  12

  
	
   

  	
  5.13.

  	
  Nature
  of Business

  	
  13

  
	
   

  	
  5.14.

  	
  Permits,
  Etc

  	
  13

  

 

i

 

	
   

  	
  5.15.

  	
  Properties

  	
  13

  
	
   

  	
  5.16.

  	
  Full
  Disclosure

  	
  13

  
	
   

  	
  5.17.

  	
  Environmental
  Matters

  	
  13

  
	
   

  	
  5.18.

  	
  Solvency

  	
  14

  
	
   

  	
  5.19.

  	
  Intellectual
  Property

  	
  14

  
	
   

  	
  5.20.

  	
  Material
  Contracts

  	
  14

  
	
   

  	
  5.21.

  	
  Private
  Placement

  	
  14

  
	
   

  	
  5.22.

  	
  Investment
  Company Act

  	
  14

  
	
   

  	
  5.23.

  	
  Employee
  and Labor Matters

  	
  15

  
	
   

  	
  5.24.

  	
  Representations
  and Warranties in Documents; No Default

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  REPRESENTATIONS
  OF THE PURCHASERS

  	
  15

  
	
   

  	
  6.1.

  	
  Purchase
  for Investment

  	
  15

  
	
   

  	
  6.2.

  	
  Accredited
  Investor

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
  PREPAYMENTS
  AND REPURCHASES OF THE NOTES

  	
  16

  
	
   

  	
  7.1.

  	
  Optional
  Prepayments of the Notes

  	
  16

  
	
   

  	
  7.2.

  	
  Offer
  to Repurchase Notes Upon a Change of Control

  	
  16

  
	
   

  	
  7.3.

  	
  Offer
  to Repurchase Notes in Respect of an Asset Sale

  	
  17

  
	
   

  	
  7.4.

  	
  Allocation
  of Partial Prepayments

  	
  18

  
	
   

  	
  7.5.

  	
  Maturity;
  Surrender, Etc

  	
  19

  
	
   

  	
  7.6.

  	
  Purchase
  of Notes

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
  COVENANTS
  OF THE PARENT AND THE COMPANIES

  	
  19

  
	
   

  	
  8.1.

  	
  Affirmative
  Covenants

  	
  19

  
	
   

  	
  8.2.

  	
  Negative
  Covenants

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
  EVENTS
  OF DEFAULT

  	
  36

  
	
   

  	
  9.1.

  	
  Events
  of Default

  	
  36

  
	
   

  	
  9.2.

  	
  Acceleration

  	
  38

  
	
   

  	
  9.3.

  	
  Other
  Remedies

  	
  38

  
	
   

  	
  9.4.

  	
  Rescission

  	
  39

  
	
   

  	
  9.5.

  	
  Restoration
  of Rights and Remedies

  	
  39

  
	
   

  	
  9.6.

  	
  No
  Waivers or Election of Remedies, Etc

  	
  39

  
	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
  REGISTRATION;
  EXCHANGE; SUBSTITUTION OF NOTES

  	
  39

  
	
   

  	
  10.1.

  	
  Registration
  of Notes

  	
  39

  
	
   

  	
  10.2.

  	
  Transfer
  and Exchange of Notes

  	
  39

  
	
   

  	
  10.3.

  	
  Replacement
  of Notes

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
  PAYMENTS
  ON NOTES

  	
  41

  
	
   

  	
  11.1.

  	
  Place
  of Payment

  	
  41

  
	
   

  	
  11.2.

  	
  Home
  Office Payment

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
  EXPENSES,
  INCREASED COSTS AND INDEMNIFICATION, ETC

  	
  42

  
	
   

  	
  12.1.

  	
  Transaction
  Expenses

  	
  42

  
	
   

  	
  12.2.

  	
  Indemnity

  	
  42

  
	
   

  	
  12.3.

  	
  Taxes

  	
  43

  

 

ii

 

	
   

  	
  12.4.

  	
  Survival

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
  SURVIVAL
  OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
  14.

  	
  AMENDMENT
  AND WAIVER

  	
  46

  
	
   

  	
  14.1.

  	
  Requirements

  	
  46

  
	
   

  	
  14.2.

  	
  Solicitation
  of Holders of Notes

  	
  47

  
	
   

  	
  14.3.

  	
  Binding
  Effect, Etc

  	
  47

  
	
   

  	
  14.4.

  	
  Notes
  Held by Companies, Etc

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
  15.

  	
  NOTICES

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
  16.

  	
  REPRODUCTION
  OF DOCUMENTS

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
  17.

  	
  CONFIDENTIAL
  INFORMATION

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
  18.

  	
  SUBSTITUTION
  OF PURCHASER

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
  19.

  	
  GUARANTY
  OF PARENT

  	
  50

  
	
   

  	
  19.1.

  	
  Guaranty

  	
  50

  
	
   

  	
  19.2.

  	
  Guaranty
  Absolute

  	
  50

  
	
   

  	
  19.3.

  	
  Waiver

  	
  51

  
	
   

  	
  19.4.

  	
  Continuing
  Guaranty; Assignments

  	
  51

  
	
   

  	
  19.5.

  	
  Subrogation

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
  20.

  	
  THE
  AGENT

  	
  52

  
	
   

  	
  20.1.

  	
  Authorization
  and Action

  	
  52

  
	
   

  	
  20.2.

  	
  Agent’s
  Reliance, Etc

  	
  53

  
	
   

  	
  20.3.

  	
  The
  Agent Individually

  	
  53

  
	
   

  	
  20.4.

  	
  Purchaser
  Credit Decision

  	
  53

  
	
   

  	
  20.5.

  	
  Indemnification

  	
  54

  
	
   

  	
  20.6.

  	
  Successor
  Administrative Agent

  	
  54

  
	
   

  	
  20.7.

  	
  Concerning
  the Collateral and the Pledge Agreement

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
  21.

  	
  MISCELLANEOUS

  	
  55

  
	
   

  	
  21.1.

  	
  Successors
  and Assigns

  	
  55

  
	
   

  	
  21.2.

  	
  Payments
  Due on Non-Business Days

  	
  56

  
	
   

  	
  21.3.

  	
  Satisfaction
  Requirement

  	
  56

  
	
   

  	
  21.4.

  	
  Severability

  	
  56

  
	
   

  	
  21.5.

  	
  Construction;
  Accounting Terms, Etc

  	
  56

  
	
   

  	
  21.6.

  	
  Computation
  of Time Periods

  	
  56

  
	
   

  	
  21.7.

  	
  Execution
  in Counterparts

  	
  56

  
	
   

  	
  21.8.

  	
  Governing
  Law; Submission to Jurisdiction, Etc

  	
  57

  
	
   

  	
  21.9.

  	
  Waiver
  of Jury Trial

  	
  57

  

 

iii

 

	
  SCHEDULES
  AND EXHIBITS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Schedule
  I

  	
  -

  	
  Information
  Relating to the Purchasers

  	
   

  
	
  Schedule
  II

  	
  -

  	
  Defined
  Terms

  	
   

  
	
  Schedule
  5.1

  	
  -

  	
  Good
  Standings

  	
   

  
	
  Schedule
  5.5

  	
  -

  	
  Capitalization
  and Subsidiaries

  	
   

  
	
  Schedule
  5.6

  	
  -

  	
  Litigation

  	
   

  
	
   Schedule 5.17

  	
  -

  	
  Environmental
  Matters

  	
   

  
	
  Schedule
  5.19

  	
  -

  	
  Intellectual
  Property Matters

  	
   

  
	
  Schedule
  5.23

  	
  -

  	
  Employee
  and Labor Matters

  	
   

  
	
  Schedule
  8.1(a)(ii)

  	
  -

  	
  Indebtedness

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit
  A

  	
  -

  	
  Form
  of Note

  	
   

  
	
  Exhibit
  B

  	
  -

  	
  Form
  of Notice of Sale and Purchase

  	
   

  
	
  Exhibit
  C

  	
  -

  	
  Form
  of Subsidiary Guaranty

  	
   

  
	
  Exhibit
  D

  	
  -

  	
  Form
  of Pledge Agreement

  	
   

  
	
  Exhibit
  E

  	
  -

  	
  Form
  of U.S. Tax Compliance Certificate

  	
   

  

 

iv

 

Vanguard Car Rental USA Inc.,

Alamo Rental (US) Inc.,

National Rental (US) Inc.

Vanguard Car Rental USA Holdings Inc.

 

14% Secured Senior Subordinated Notes due March 30, 2008

 

As of October 14, 2003

 

TO EACH OF THE PURCHASERS LISTED IN

SCHEDULE I ATTACHED HERETO:

 

Ladies
and Gentlemen:

 

Each
of Vanguard Car Rental USA Holdings Inc., a Delaware corporation (the
“Parent”), Vanguard Car Rental USA Inc., a Delaware corporation (“Vanguard “),
Alamo Rental (US) Inc., a Delaware corporation (“Alamo”), and National Rental
(US) Inc., a Delaware corporation (“National” and together with Vanguard and
Alamo, the “Companies”), hereby agrees with the purchasers party hereto
(together with their successors and assigns, collectively, the “Purchasers”)
and Madeleine L.L.C., a New York limited liability company, as administrative
agent and collateral agent for the Purchasers (in such capacities, the “Agent”)
as follows:

 

1.                                       AUTHORIZATION OF NOTES

 

The
Companies will authorize the issuance and sale of $80,000,000 aggregate
principal amount of their 14% Secured Senior Subordinated Notes due March 30,
2008 (the Notes delivered pursuant to Section 2 and any Notes issued in
substitution therefor pursuant to Section 10 being, collectively, the “Notes”).
Each of the Notes shall be in substantially the form of Exhibit A hereto, with
such amendments, supplements and other modifications thereto, if any, as shall
be approved from time to time by you and the Companies. Capitalized terms used
in this Agreement shall have the meanings specified in Schedule II.

 

2.                                       SALE AND PURCHASE OF NOTES.

 

2.1.          Obligation to Purchase. Subject
to the terms and conditions of this Agreement, the Companies will jointly and
severally issue and sell to each Purchaser, and each Purchaser will purchase
from the Companies, on October 14, 2003 (the “Purchase Date”), Notes in an
aggregate principal amount not to exceed such Purchaser’s Commitment at such
date. The obligations of the Purchasers hereunder are several and not joint
obligations, and no Purchaser shall have any obligation hereunder and no
liability to any Person for the performance or nonperformance by any other
Purchaser hereunder. The sale and purchase of Notes pursuant to this Section
2.1 shall be in an aggregate principal amount of $80,000,000. Notes purchased
and sold under this Section 2.1 and repaid or prepaid may not be repurchased
and resold.

 

 

2.2.          Notice of Purchase. The sale
and purchase of Notes shall be made upon notice, given not later than 11:00
A.M. (New York City time) on the second Business Day prior to the Purchase
Date, by the Companies to the Agent. The notice of the proposed sale and
purchase of Notes (the “Notice of Sale and Purchase”) shall be by telephone,
confirmed immediately in writing, or by facsimile, in substantially the form of
Exhibit B, specifying therein the requested (a) Purchase Date (which
shall be a Business Day), and (b) aggregate principal amount of Notes to
be purchased by each Purchaser on the Purchase Date. On the Purchase Date,
subject to the fulfillment of the applicable conditions set forth in Section 4,
the Companies will deliver to each Purchaser the Notes to be purchased by such
Purchaser on the Purchase Date in the form of a single Note (or such greater
number of Notes in denominations of at least $1,000,000 or integral multiples of
$100,000 in excess thereof as such Purchaser may request at least one Business
Day prior to the Purchase Date), dated the Purchase Date and registered in the
name of such Purchaser (or in the name of such Purchaser’s nominee), duly
executed by the Companies, against delivery by such Purchaser to the Companies
or their order of same day funds in the amount of the aggregate purchase price
therefor by wire transfer to Worldwide Excellerated Leasing Ltd. as paying
agent for the account of the Companies pursuant to the following wire
instructions: Bank of America, ABA No: 111-000-012, Account Name: Worldwide
Excellerated Leasing Ltd., Account No. 3752110931.

 

2.3.          Closing. The sale and purchase
of the Notes to be purchased by the Purchaser shall occur at the offices of
Schulte Roth & Zabel LLP, 919 Third Avenue, New York, New York 10022, at or
before 10:00 A.M. (New York City time), at a closing on the Purchase Date.

 

2.4.          Interest.

 

(a)           Interest Rate. Except as
provided in subsection (b) below, each Note shall bear interest on the
principal amount thereof, for each day during which such principal amount is
outstanding, at a rate per annum equal to 14%.

 

(b)           Default Interest. To the
extent permitted by law, upon the occurrence and during the continuance of an
Event of Default, the principal of, and all accrued and unpaid interest on, all
Notes, and all fees, indemnities and other Obligations of the Credit Parties
under this Agreement and the other Note Documents, shall bear interest, from
the date such Event of Default occurred until such Event of Default is cured or
waived in writing in accordance herewith, at a rate per annum equal at all
times to the Default Rate.

 

(c)           Interest Payments. Interest
payable pursuant to subsection (a) above shall be payable monthly in arrears,
on the first day of each calendar month commencing November 1, 2003 and at
maturity (whether upon demand, by acceleration or otherwise). Interest payable
pursuant to subsection (b) above shall be payable in cash on demand.

 

(d)           General. All interest shall be
computed on the basis of a year of 360 days for the actual number of days,
including the first day but excluding the last day, elapsed.

 

2

 

2.5.          Fees. The Companies shall pay
to the Purchasers the following fees and charges, which fees and charges shall
be non-refundable when paid (irrespective of whether this Agreement is
terminated thereafter):

 

(a)           Closing Fee. A fee of $800,000
(the “Closing Fee”) will be earned as of the Purchase Date and shall be and
payable on the Purchase Date to the Purchasers in proportion to their
respective Pro Rata Shares.

 

(b)           Anniversary Fee. A fee of
$800,000 will be earned as of each anniversary of the Purchase Date and shall
be payable on such date to the Purchasers in proportion to their respective Pro
Rata Shares.

 

3.                                       PAYMENTS; NATURE OF COMPANIES’ OBLIGATIONS.

 

3.1.          Payments and Computations. The
Companies will make each payment under this Agreement not later than 1:00 p.m.
(New York City time) on the day when due, in lawful money of the United States
of America and in immediately available funds, to the Agent’s Account. All
payments received by the Agent after 1:00 p.m. (New York City time) on any
Business Day will be credited on the next succeeding Business Day. All payments
shall be made by the Companies without set-off, counterclaim, deduction or
other defense to the Agent and the Purchasers. After receipt, the Agent will
promptly thereafter cause to be distributed like funds relating to the payment
of principal ratably to the Purchasers in accordance with their Pro Rata Shares
and like funds relating to the payment of any other amount payable to any
Purchaser to such Purchaser, in each case to be applied in accordance with the
terms of this Agreement. Whenever any payment to be made under any such Note
Document shall be stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day and such extension of
time shall in such case be included in the computation of interest or fees, as
the case may be. All computations of fees shall be made by the Agent on the
basis of a year of 360 days for the actual number of days, including the first
day but excluding the last day, elapsed. Each determination by the Agent of an
interest rate or fees hereunder shall be conclusive and binding for all
purposes in the absence of manifest error.

 

3.2.          Sharing of Payments, Etc. If
any Purchaser shall obtain any payment (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise) on account of any
Obligation in excess of its ratable share of payments on account of similar
obligations obtained by all of the Purchasers, such Purchaser shall forthwith
purchase from the other Purchasers such participations in such similar
obligations held by them as shall be necessary to cause such purchasing
Purchaser to share the excess payment ratably with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Purchaser, such purchase from each Purchaser
shall be rescinded and such Purchaser shall repay to the purchasing Purchaser
the purchase price to the extent of such recovery together with an amount equal
to such Purchaser’s ratable share (according to the proportion of (i) the
amount of such Purchaser’s required repayment to (ii) the total amount so
recovered from the purchasing Purchaser of any interest or other amount paid by
the purchasing Purchaser in respect of the total amount so recovered). The
Companies agree that any Purchaser so purchasing a participation from another
Purchaser pursuant to this Section 3.2 may, to the fullest extent
permitted by law, exercise all of its rights (including such Purchaser’s right
of set-off) 

 

3

 

with respect to such participation as fully as if
such Purchaser were the direct creditor of the Companies in the amount of such
participation.

 

3.3.          Apportionment of Payments.

 

(a)           All payments of principal and interest
in respect of outstanding Notes, all payments of fees, and all other payments
in respect of any other Obligations shall be allocated by the Agent among such
of the Purchasers as are entitled thereto, in proportion to their respective
Pro Rata Shares or otherwise as provided herein or, in respect of payments not
made on account of the Notes, as designated by the Person making payment when
the payment is made.

 

(b)           After the occurrence and during the
continuance of an Event of Default, the Agent may, and upon the direction of
the Required Holders shall, apply all payments in respect of any Obligations
and all proceeds of the Collateral, subject to the provisions of this
Agreement, (i) first, ratably to pay the Obligations in respect of any
fees, expense reimbursements, indemnities and other amounts then due to the
Agent until paid in full; (ii) second, ratably to pay the
Obligations in respect of any fees and indemnities then due to the Purchasers
until paid in full; (iii) third, ratably to pay interest due in
respect of the Notes until paid in full; (iv) fourth, ratably to
pay principal of the Notes until paid in full; and (v)  fifth, to
the ratable payment of all other Obligations then due and payable.

 

3.4.          Joint and Several Liability of the
Companies.

 

(a)           Notwithstanding anything in this
Agreement or any other Note Document to the contrary, each of the Companies
hereby accepts joint and several liability hereunder and under the other Note
Documents in consideration of the financial accommodations to be provided by
the Agent and the Purchasers under this Agreement and the other Note Documents,
for the mutual benefit, directly and indirectly, of each of the Companies and
in consideration of the undertakings of the other Companies to accept joint and
several liability for the Obligations. Each of the Companies, jointly and
severally, hereby irrevocably and unconditionally accepts, not merely as a
surety but as a co-debtor, joint and several liability with the other
Companies, with respect to the payment and performance of all of the
Obligations (including, without limitation, any Obligations arising under this
Section 3.4, it being the intention of the parties hereto that all of the
Obligations shall be the joint and several obligations of each of the Companies
without preferences or distinction among them). If and to the extent that any
of the Companies shall fail to make any payment with respect to any of the
Obligations as and when due or to perform any of the Obligations in accordance
with the terms thereof, then in each such event, the other Companies will make
such payment with respect to, or perform, such Obligation. Subject to the terms
and conditions hereof, the Obligations of each of the Companies under the
provisions of this Section 3.4 constitute the absolute and unconditional, full
recourse Obligations of each of the Companies, enforceable against each such
Person to the full extent of its properties and assets, irrespective of the
validity, regularity or enforceability of this Agreement, the other Note
Documents or any other circumstances whatsoever.

 

(b)           The provisions of this Section 3.4
are made for the benefit of the Agent, the Purchasers and their successors and
assigns, and may be enforced by them from time 

 

4

 

to time against any or all of the Companies as often
as occasion therefor may arise and without requirement on the part of the
Agent, the Purchasers or such successors or assigns first to marshal any of its
or their claims or to exercise any of its or their rights against any of the
other Companies or to exhaust any remedies available to it or them against any
of the other Companies or to resort to any other source or means of obtaining
payment of any of the Obligations hereunder or to elect any other remedy. The
provisions of this Section 3.4 shall remain in effect until all of the
Obligations shall have been paid in full or otherwise fully satisfied.

 

(c)           Each of the Companies hereby agrees
that it will not enforce any of its rights of contribution or subrogation
against the other Companies with respect to any liability incurred by it
hereunder or under any of the other Note Documents, any payments made by it to
the Agent or the Purchasers with respect to any of the Obligations or any Collateral,
until such time as all of the Obligations have been paid in full in cash. Any
claim which any Company may have against any other Company with respect to any
payments to the Agent or the Purchasers hereunder or under any other Note
Documents are hereby expressly made subordinate and junior in right of payment,
without limitation as to any increases in the Obligations arising hereunder or
thereunder, to the prior payment in full in cash of the Obligations.

 

4.                                       CONDITIONS TO THE PURCHASE.

 

The
obligation of each Purchaser to purchase and pay for the Notes to be sold to
such Purchaser on the Purchase Date is subject to the fulfillment, on or prior
to the Purchase Date, of the following conditions:

 

4.1.          Documents Required. Such
Purchaser shall have received the following documents, each dated as of the
Purchase Date (except as otherwise specified below) and in the form of the
respective Exhibit hereto, if any, or otherwise in form and substance
satisfactory to such Purchaser:

 

(a)           Note Purchase Agreements. This
Agreement, duly executed by each of the Companies.

 

(b)           Notice of Sale and Purchase.
The Notice of Sale and Purchase, properly completed and duly executed by each
of the Companies.

 

(c)           Notes. Notes, each registered
in the name of a Purchaser, in such aggregate principal amount as is specified
to be purchased by such Purchaser in the Notice of Sale and Purchase and in
such number of Notes and in such denominations (of at least $1,000,000 per
Note) as are specified to the Companies by such Purchaser at least one Business
Day prior to the Purchase Date (and in the absence of such specification, in a
single Note), in each case duly executed by each of the Companies.

 

(d)           Subsidiary Guaranty. The
Subsidiary Guaranty, duly executed by each of Vanguard Car Rental Claims Inc.,
Vanguard Real Estate Holdings LLC and Alamo Rent-A-Car (Canada), Inc.

 

(e)           Pledge Agreement. The Pledge
Agreement, duly executed by each Company that is a party thereto on the
Purchase Date, together with such appropriate financing 

 

5

 

statements duly filed in such office or offices as
may be necessary or, in the Agent’s opinion, desirable to perfect the security
interests purported to be created by the Pledge Agreement.

 

(f)            Intercreditor Agreements. The
Intercreditor Agreements, duly executed by all the parties thereto and duly
acknowledged by the applicable Obligors (as defined therein).

 

(g)           Lien Searches. Appropriate
searches, listing all effective financing statements which name as debtor any
Credit Party, together with copies of such financing statements, none of which,
except as agreed to in writing by the Agent, shall cover any of the Collateral
and the results of searches for any tax Lien and judgment Lien filed against
such Person or its property or assets, which results, except as agreed to in
writing by the Agent, shall not show any such Liens.

 

(h)           Corporate Approvals and Other
Similar Documentation. Certified copies of the resolutions of the board of
directors of each Credit Party approving each of the Note Documents to which it
is or is to be a party, the issuance and sale of the Notes or the guarantee
thereof, as applicable, and the other transactions contemplated hereby and
thereby and all documents evidencing other necessary corporate action with
respect to each such Note Document, the issuance and sale of the Notes or the
guarantee thereof, as applicable, and the other transactions contemplated
hereby and thereby.

 

(i)            Organizational Documents. A
copy of the certificate of incorporation of each Credit Party and each
amendment thereto, certified as of a date reasonably near the Purchase Date by
the appropriate official of the state of such Person’s formation as being a
true and complete copy thereof, including any amendments thereto.

 

(j)            Good Standing Certificates. A
copy of a certificate of the appropriate official of the state of incorporation
of each Credit Party, dated reasonably near the Purchase Date, listing the
certificate of incorporation of such Person and each amendment thereto on file
in the office of such official and certifying that (i) such amendments are
the only amendments to such certificate of such Person on file in the office of
such person, (ii) such Person has paid all franchise taxes (or the equivalent
thereof) to the date of such certificate and (iii) such Person is duly
incorporated or formed, as applicable and in good standing under the laws of
such state.

 

(k)           Secretary’s Certificate. A
certificate of the secretary or an assistant secretary (or a person performing
similar functions) of each Credit Party certifying:

 

(i)            the absence of any amendments to the
certificate of incorporation of any Credit Party since the date of the
certificate referred to in subsection (j) of this Section 4.1;

 

(ii)           the completeness and accuracy of the
resolutions of the board of directors of each Credit Party and all documents
evidencing other necessary corporate action thereof referred to in
subsection (h) of this Section 4.1;

 

6

 

(iii)          the completeness and accuracy of the
bylaws of each Credit Party as in effect on the date the resolutions of the
board of directors of such Person referred to in subsection (h) of this
Section 4.1 were adopted and on the Purchase Date (a copy of which shall
be attached to such certificate); and

 

(iv)          the names and true signatures of the
officers of each Credit Party authorized to sign each of the Note Documents to
which it is or is to be a party and the other agreements, instruments and other
documents to be delivered hereunder or thereunder.

 

(l)            Officer’s Certificate. A
certificate of the Treasurer of Vanguard, certifying as to:

 

(i)            the absence of any proceeding for
the dissolution or liquidation of any of the Parent and the Companies;

 

(ii)           the completeness and accuracy in all
material respects of all of the representations and warranties made by each
Credit Party in this Agreement and the other Note Documents to which it is or
is to be a party, before and after giving effect to the issuance and sale of
the Notes and to the application of the proceeds thereof as contemplated by
Section 5.12, as though made on and as of the Purchase Date;

 

(iii)          the absence of any event occurring and
continuing, or resulting from the issuance and sale of the Notes or the
consummation of any of the other transactions contemplated hereby, that
constitutes a Default or an Event of Default; and

 

(iv)          to the best knowledge of such person,
the absence of any existing or threatened event or circumstance applicable to
any Credit Party that could reasonably be expected to impair the ability of any
Credit Party to consummate the transactions contemplated hereby.

 

(m)          Financing Documents. To the
extent requested by the Agent, a copy of each of the Senior Financing
Documents, the Junior Subordinated Indebtedness Documents and any and all other
documents evidencing any vehicle financing provided to any of the Companies and
their respective Subsidiaries, in each case certified by a Responsible Officer
as being a true and complete copy.

 

(n)           The Sale Order. A copy of the
Sale Order, certified by a Responsible Officer as being a true and complete
copy.

 

(o)           Acquisition Agreement. A copy
of the Acquisition Agreement, certified by a Responsible Officer as being a
true and complete copy.

 

(p)           Equity Documents. To the
extent requested by the Agent, a copy of each Equity Document, certified by a
Responsible Officer as being a true and complete copy.

 

(q)           Insurance and Surety Bonding.
A copy of each of the Liberty Agreements and, to the extent requested by the
Agent, all agreements, instruments and other documents executed in connection
therewith or otherwise relating to the provisions of insurance 

 

7

 

bonds for the benefit of the Companies and their
Subsidiaries, each certified by a Responsible Officer as being a true and
correct copy, and such other evidence of the insurance coverage required by
this Agreement as the Agent may request.

 

(r)            Information Technology. A
copy of the Perot Agreement, certified as being a true and correct copy.

 

4.2.          The Sale Order. The Sale Order
(a) shall have been entered by the Bankruptcy Court, (b) shall be in full force
and effect, and (c) shall not have been reversed, stayed, modified or amended.
No appeals shall have been filed within the time period specified by
Rule 8002(a) of the Federal Rules of Bankruptcy Procedure or, in the event
a timely appeal has been filed, the effectiveness of the Sale Order shall not
have been stayed in accordance with Rule 8005 of the Federal Rules of
Bankruptcy Procedure, and CAR Acquisition Company LLC shall not have exercised
its termination right under Section 7.16(viii)(3) of the Acquisition Agreement
within 20 days from the date such appeal is filed.

 

4.3.          The Acquisition. The Acquisition
shall have been consummated in accordance with all applicable law, the
Acquisition Agreement (without any material amendment or modification thereto)
and the Sale Order. All conditions precedent to the consummation of the
Acquisition, whether set forth in the Acquisition Documents or otherwise, shall
have been satisfied (or, with the prior written consent of Required Holders,
waived).

 

4.4.          Capitalization.

 

(a)           The Investors shall have made a cash
equity investment of not less than $100,000,000 in Worldwide, and the proceeds
of such equity investment shall have been applied to consummate the Acquisition
and the other transactions contemplated by the Documents.

 

(b)           The Senior Financing Agreement and
the other Senior Financing Documents to be executed and delivered on or prior
to the Purchase Date shall have been executed and delivered by each party
thereto and shall have become effective in accordance with their respective
terms, and all loans to be made thereunder on the Purchase Date shall have been
made and the proceeds thereof shall have been applied in accordance with the
terms of the Senior Financing Agreement, and, after giving effect to such loans
and the sale of all Notes to be sold on the Purchase Date, the consummation of
the Acquisition, the deposit of all cash collateral required pursuant to the
Liberty Agreement, the payment of all fees and expenses related the
Acquisition, and the payment of all Cure Costs (as defined in the Acquisition
Agreement) (and provided accounts payable are at a level and in a condition
reasonably satisfactory to the Purchasers), opening availability under the
Revolving Credit Facility is at least $100,000,000.

 

(c)           The Junior Subordinated Indebtedness
Documents shall have been executed and delivered by each party thereto and
shall have become effective in accordance with their respective terms and all
notes to be purchased thereunder shall have been purchased for cash at par and
the proceeds thereof shall have been applied in accordance with the terms of
the Junior Subordinated Indebtedness Documents.

 

8

 

4.5.          Insurance and Surety Bonding
Requirements. The Liberty Agreement and all material agreements,
instruments and other documents to be executed in connection therewith or
otherwise relating to the provision of insurance bonds for the benefit of the
Companies and their Subsidiaries shall have been executed and delivered by each
party thereto and shall have become effective in accordance with their
respective terms.

 

4.6.          Information Technology. The
Perot Agreement shall have been executed and delivered by each party thereto
and shall have become effective in accordance with its terms.

 

4.7.          Payment of Accrued Fees and
Expenses. Without limiting the provisions of Section 12.1, all of the
accrued fees and expenses incurred by the Purchasers in connection with the
transactions contemplated by this Agreement and the other Note Documents to be
paid by or on behalf of the Companies on or prior to the Purchase Date shall have
been paid.

 

4.8.          Representations and Warranties.
The representations and warranties of the Parent and the Companies contained in
the Note Documents shall be complete and correct on the date of the Notice of
Sale and Purchase and on the Purchase Date, before and after giving effect to
the issue and sale of the Notes and to the application of the proceeds thereof
as contemplated by Section 5.12(a).

 

4.9.          No Default. After giving effect
to the issuance and sale of the Notes and to the application of the proceeds
thereof as contemplated by Section 5.12(a), no Default or Event of Default
shall have occurred and be continuing.

 

4.10.        Purchase Permitted by Applicable
Requirements of Law, Etc. The purchase of and any payment for the Notes to
be purchased by the Purchasers on the Purchase Date (a) shall not violate
any applicable Requirements of Law (including, without limitation, Regulation
T, U or X of the Board of Governors of the Federal Reserve System) and
(b) shall not subject any Purchaser to any tax, penalty or other liability
under or pursuant to any applicable Requirements of Law, except for any Taxes
or Other Taxes for which the Companies are obligated to compensate you under
Section 12.3.

 

4.11.        Consents and Approvals. All
Governmental Authorizations and all consents, approvals and authorizations of
any other Person required to be obtained in connection with the consummation of
the transactions contemplated by the Documents (other than the Note Documents),
except those consents, approvals and authorizations the failure to obtain could
not reasonably be expected to have a Material Adverse Effect, shall have been
obtained and shall remain in full force and effect; and all applicable waiting
periods shall have expired without any action being taken by any Governmental
Authority that could reasonably be expected to restrain, prevent or impose any
material adverse conditions on the Companies, the Acquisition, the issuance and
sale of the Notes, or the consummation of any of the other transactions
contemplated by the Documents (other than the Note Documents).

 

4.12.        No Litigation or Other Proceedings.
There shall exist no claim, action, suit, investigation, litigation or
proceeding pending or, to the best knowledge of the Credit Parties, threatened
against or affecting any Credit Party or any of the property or assets thereof
in any court or before any arbitrator or by or before any other Governmental
Authority that

 

9

 

(a) could reasonably be expected to have a Material
Adverse Effect or (b) challenges the legality, validity, binding effect or
enforceability of the Acquisition Agreement, any Note Document, the issuance
and sale of the Notes, or the consummation of any of the other transactions
contemplated by the Documents.

 

5.                                       REPRESENTATIONS AND WARRANTIES OF THE CREDIT
PARTIES

 

Each
of the Parent and the Companies represents and warrants to the Purchasers that:

 

5.1.          Organization, Good Standing, Etc.
Each Credit Party (a) is a corporation duly organized, validly existing and in
good standing under the laws of the state of its organization, (b) has all
requisite power and authority to conduct its business as now conducted and as
presently contemplated (both before and after giving effect to the Acquisition)
and, in the case of the Companies, to execute the Notes hereunder, and to
execute and deliver each Document to which it is a party, and to consummate the
transactions contemplated thereby, and (c) except as set forth in
Schedule 5.1, before and after giving effect to the Acquisition, is duly
qualified to do business and is in good standing in each jurisdiction in which
the character of the properties owned or leased by it or in which the
transaction of its business makes such qualification necessary.

 

5.2.          Authorization, Etc. The
execution, delivery and performance by each Credit Party of each Note Document
to which it is or will be a party (a) have been duly authorized by all
necessary action, (b) do not and will not contravene its charter or by-laws, or
any applicable Requirement of Law or any contractual restriction binding on or
otherwise affecting it or any of its properties, (c) do not and will not result
in or require the creation of any Lien (other than pursuant to any Note
Document) upon or with respect to any of its properties, and (d) do not and
will not result in any default, noncompliance, suspension, revocation,
impairment, forfeiture or nonrenewal of any permit, license, authorization or
approval applicable to its operations or any of its properties.

 

5.3.          Governmental Approvals. No
authorization or approval or other action by, and no notice to or filing with,
any Governmental Authority is required in connection with the due execution,
delivery and performance by any Credit Party of any Note Document to which it
is or will be a party.

 

5.4.          Enforceability of Note Documents.
This Agreement is, and each other Note Document to which any Credit Party is or
will be a party, when delivered, will be, a legal, valid and binding obligation
of such Credit Party, enforceable against such Credit Party in accordance with
its terms, except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws.

 

5.5.          Subsidiaries. Schedule 5.5
is a complete and correct description of the name, jurisdiction of
incorporation and ownership of the outstanding Capital Stock of each Credit
Party and its Subsidiaries in existence on the date hereof after giving effect
to the Acquisition. After giving effect to the Acquisition, all of the issued and
outstanding shares of such Capital Stock have been validly issued and are fully
paid and nonassessable, and the holders 

 

10

 

thereof are not entitled to any preemptive, first
refusal or other similar rights. Except as indicated on such Schedule 5.5, all
such Capital Stock is owned by the respective equity holders, as shown on such
Schedule 5.5, free and clear of all Liens. There are no outstanding debt
or equity securities of a Credit Party or any of its Subsidiaries and no
outstanding obligations of a Credit Party or any of its Subsidiaries that are
convertible into or exchangeable for, or warrants, options or other rights for
the purchase or acquisition from such Credit Party or any of its Subsidiaries,
or other obligations of a Credit Party or any of its Subsidiaries to issue,
directly or indirectly, any shares of Capital Stock of such Credit Party or any
of its Subsidiaries.

 

5.6.          Litigation. Except as set forth
on Schedule 5.6, there is no pending or, to the knowledge of any Credit
Party, threatened action, suit or proceeding affecting any Credit Party or any
of its Subsidiaries or any of their respective properties before any court or
other Governmental Authority or any arbitrator that (i) could reasonably
be expected to have a Material Adverse Effect or (ii) relates to this
Agreement, the Notes or any other Note Document or any transaction contemplated
hereby or thereby.

 

5.7.          Financial Condition.

 

(a)           Since June 30, 2003, no event or
development has occurred that has had or could reasonably be expected to have a
Material Adverse Effect.

 

(b)           The Parent has heretofore furnished
to the Purchasers unaudited pro forma condensed consolidated financial
statements for the six-month period ended June 30, 2003 and for the year
ended December 31, 2002, giving effect to the Acquisition and the other
transactions contemplated by the Documents as if each had occurred as of the
beginning of such respective periods. Such financial statements have been
prepared on a reasonable basis and in good faith by the Parent and have been
based on preliminary estimates, available information and certain assumptions
believed by the Parent to be reasonable.

 

(c)           As of the Purchase Date the
Consolidated Net Worth of Vanguard and its Subsidiaries is in excess of
$180,000,000.

 

5.8.          Compliance with Law, Etc. None
of the Credit Parties and their Subsidiaries is in violation of its
organizational documents, any Requirement of Law applicable to it or any of its
property or assets, or any material term of any agreement or instrument binding
on or otherwise affecting it or any of its properties or assets, the violation
of which could reasonably be expected to have a Material Adverse Effect.

 

5.9.          ERISA. (a) each Employee Plan
is in substantial compliance with ERISA and the IRC, (b) no Termination
Event has occurred or is reasonably expected to occur with respect to any
Employee Plan, (c) no Employee Plan had an accumulated or waived funding
deficiency or permitted decreases which would create a deficiency in its
funding standard account or has applied for an extension of any amortization
period within the meaning of Section 412 of the IRC at any time during the
previous 60 months, (d) no Lien imposed under the IRC or ERISA exists
or is likely to arise on account of any Employee Plan within the meaning of
Section 412 of the IRC at any time during the previous 60 months, and (e)
no Credit Party or any of its ERISA Affiliates has incurred any withdrawal
liability under ERISA with 

 

11

 

respect to any Multiemployer Plan, or is aware of
any facts indicating that the Credit Parties or any of their ERISA Affiliates
may in the future incur any such withdrawal liability. No Credit Party or any
of its ERISA Affiliates or any fiduciary of any Employee Plan has (A) engaged
in a nonexempt prohibited transaction described in Section 406 of ERISA or
Section 4975 of the IRC, (B) failed to pay any required installment or other
payment required under Section 412 of the IRC on or before the due date for
such required installment or payment, (C) engaged in a transaction within the
meaning of Section 4069 of ERISA or (D) incurred any liability to the PBGC
which remains outstanding other than the payments of premiums, and there are no
premium payments that have become due and that are unpaid. There are no pending
or, to the knowledge of any Credit Party, threatened claims, actions,
proceedings or lawsuits (other than claims for benefits in the normal course)
asserted or instituted against any Employee Plan or its assets, any fiduciary
with respect to any Employee Plan, or any Credit Party or any of its ERISA
Affiliates with respect to any Employee Plan.

 

5.10.        Health Benefits; WARN. Except as
required by Section 4980B of the IRC, no Credit Party or any of its ERISA
Affiliates maintains an employee welfare benefit plan (as defined in Section
3(1) of ERISA) which provides health or welfare benefits (through the purchase
of insurance or otherwise) for any retired or former employee of any Credit
Party or any of its ERISA Affiliates or coverage after a participant’s
termination of employment. No Credit Party or any of its ERISA Affiliates has
incurred any liability or obligation under the Worker Adjustment and Retraining
Notification Act (“WARN”) or similar state law, which remains unpaid or
unsatisfied.

 

5.11.        Taxes, Etc. All Federal, state
and local tax returns and other reports required by applicable law to be filed
by any Credit Party have been filed, or extensions have been obtained, and all
taxes, assessments and other governmental charges imposed upon any Credit Party
or any property of any Credit Party and which have become due and payable on or
prior to the date hereof have been paid, except to the extent contested in good
faith by proper proceedings which stay the imposition of any penalty, fine or
Lien resulting from the non-payment thereof and with respect to which adequate
reserves have been set aside for the payment thereof in accordance with GAAP.

 

5.12.        Use of Proceeds; Margin Regulations.

 

(a)           The proceeds received from the
issuance and sale of the Notes will be used (i) to pay a portion of the
purchase price for the Assets pursuant to the Acquisition Agreement, (ii) to
refinance existing indebtedness in connection with the Acquisition, and (iii)
to pay fees and expenses related to the Acquisition and the financing thereof.

 

(b)           None of the Companies nor any of
their Subsidiaries is engaged in the business of extending credit for the
purpose of purchasing or carrying any “margin stock” (within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System). No part
of the proceeds from the sale of the Notes will be used, directly or
indirectly, for the purpose of purchasing or carrying any margin stock or for
the purpose of purchasing, carrying or trading in any securities under such
circumstances as to involve the Companies or any of their Subsidiaries in a
violation of Regulation X of the Board of Governors of the Federal Reserve
System (12 CFR 224) or to involve any broker or dealer in a violation of
Regulation T of the 

 

12

 

Board of Governors of the Federal Reserve System.
None of the transactions contemplated by this Agreement and the other Note Documents
(including, without limitation, the direct and indirect use of proceeds of the
Notes) will violate or result in a violation of the Exchange Act or any of the
rules and regulations promulgated thereunder or in such Regulation T, U or X,
as applicable, or, assuming the accuracy of the representations and warranties
made by the Purchasers in this Agreement the Securities Act or any of the rules
and regulations promulgated thereunder.

 

5.13.        Nature of Business. After giving
effect to the Acquisition:  (a) no
Company has or is engaged in any business other than a Permitted Business, and
(b) the Parent has not and is not engaged in any business activities other than
(i) the ownership of the Capital Stock of Vanguard and its other direct
Subsidiaries as set forth on Schedule 5.5 and (ii) the entering into,
and performing its obligations and exercising its rights under, the Documents
to which it is a party.

 

5.14.        Permits, Etc. Before and after
giving effect to the Acquisition, each Credit Party has, and is in material
compliance with, all permits, licenses, authorizations, approvals, entitlements
and accreditations required for such Credit Party lawfully to own, lease,
manage or operate, or to acquire, each business currently owned, leased,
managed or operated, or to be acquired, by such Person, except for those
permits, licenses, authorizations, approvals, entitlements and accreditations,
the failure to have or to be in compliance with which could reasonably be
expected to have a Material Adverse Effect.

 

5.15.        Properties. After giving effect
to the Acquisition, each Credit Party has good and marketable title to, valid
leasehold interests in, or valid licenses to use, all property and assets
material to its business, free and clear of all Liens except Permitted Liens.
All such properties and assets are in good working order and condition,
ordinary wear and tear excepted.

 

5.16.        Full Disclosure. None of the
reports, financial statements, certificates or other information furnished by
or on behalf of any Credit Party to the Agent or any Purchaser in connection
with the negotiation of this Agreement or delivered hereunder (as modified or
supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which it was made,
not misleading; provided, however, that, with respect to
projected financial information, each Credit Party represents only that such
information was prepared in good faith based upon assumptions believed to be
reasonable at the time.

 

5.17.        Environmental Matters. Except as
set forth on Schedule 5.17, (a) the operations of each Credit Party
are in compliance in all material respects with Environmental Laws, the
noncompliance with which could not reasonably be expected to have a Material
Adverse Effect; (b) there has been no Release at any of the properties owned or
operated by any Credit Party or a predecessor in interest, or at any disposal
or treatment facility which received Hazardous Materials generated by any
Credit Party or any predecessor in interest which in either case could
reasonably be expected to have a Material Adverse Effect; (c) no Environmental
Action has been asserted against any Credit Party or any predecessor in
interest and no Credit Party has knowledge or notice of any threatened or
pending Environmental Action against any Credit Party or any predecessor in
interest which in either case could reasonably be expected to have a Material 

 

13

 

Adverse Effect; and (d) no Environmental Actions
have been asserted against any facilities that may have received Hazardous
Materials generated by any Credit Party or any predecessor in interest which
could reasonably be expected to have a Material Adverse Effect.

 

5.18.        Solvency. After giving effect to
the Acquisition and the other transactions contemplated by the Documents, each
Credit Party is, and the Parent and its Subsidiaries on a consolidated basis
are, Solvent.

 

5.19.        Intellectual Property. Except as
set forth on Schedule 5.19 and after giving effect to the Acquisition,
each Credit Party owns or licenses or otherwise has the right to use all
licenses, patents, patent applications, trademarks, trademark applications,
service marks, trade names, copyrights, copyright applications, and other
intellectual property rights that are material to, and necessary for, the
operations of its businesses, without infringement upon or conflict with the
rights of any other Person with respect thereto, except for such infringements
and conflicts that could not reasonably be expected to have a Material Adverse
Effect. To the best knowledge of the Parent, no slogan or other advertising
device, product, process, method, substance, part or other material now
employed, or now contemplated to be employed, by any Credit Party infringes
upon or conflicts with any rights owned by any other Person, and no claim or
litigation regarding any of the foregoing is pending or threatened, except for
such infringements and conflicts that could not reasonably be expected to have
a Material Adverse Effect.

 

5.20.        Material Contracts. Each Material
Contract (a) is in full force and effect and is binding upon and
enforceable against each Credit Party that is a party thereto and, to the best
knowledge of such Credit Party, all other parties thereto in accordance with
its terms, (b) has not been otherwise amended or modified, and (c) is not
in default due to the action of any Credit Party or, to the best knowledge of
any Credit Party, any other party thereto except as to any default that could
not reasonably be expected to have a Material Adverse Effect.

 

5.21.        Private Placement.

 

(a)           No form of general solicitation or
general advertising was used by the Parent, any of the Companies, or, to the
best knowledge of the Parent and the Companies, any other Person acting on
behalf of any of them, in respect of this Agreement or the other Note Documents
or in connection with the offer and sale of the Notes.

 

(b)           Assuming the accuracy of the
representations and warranties contained in Section 6.1, the execution and
delivery of this Agreement and the other Note Documents constitute transactions
exempt from the registration requirements of the Securities Act.

 

5.22.        Investment Company Act. None of
the Credit Parties nor any of their Subsidiaries is an “investment company” or
a company controlled by an “investment company” within the meaning of the
Investment Company Act of 1940, as amended. None of the sale and purchase of
the Notes, the application of the proceeds therefrom or the repayment of the
Notes by the Companies and the consummation of the other transactions
contemplated by the Note 

 

14

 

Documents will violate any provision of such Act or
any rule, regulation or order of the Securities and Exchange Commission
thereunder.

 

5.23.        Employee and Labor Matters.
Except as set forth on Schedule 5.23, there is (a) no unfair labor
practice complaint pending or, to the best knowledge of any Credit Party,
threatened against any Credit Party or any of its Subsidiaries before any
Governmental Authority and no grievance or arbitration proceeding pending or
threatened against any Credit Party or any of its Subsidiaries which arises out
of or under any collective bargaining agreement, (b) no strike, labor dispute,
slowdown, stoppage or similar action or grievance pending or threatened against
any Credit Party or any of its Subsidiaries or (c) to the best knowledge of any
Credit Party, no union representation question existing with respect to the
employees of any Credit Party or any of its Subsidiaries and no union
organizing activity taking place with respect to any of the employees of any of
them which could be reasonably likely to have a Material Adverse Effect. The
hours worked and payments made to employees of any Credit Party or any of its
Subsidiaries have not been in violation of the Fair Labor Standards Act or any
other applicable legal requirements. After giving effect to the Acquisition,
all material payments due from any Credit Party or any of its Subsidiaries on
account of wages and employee health and welfare insurance and other benefits
have been paid or accrued as a liability on the books of such Credit Party or
such Subsidiary.

 

5.24.        Representations and Warranties in
Documents; No Default. All representations and warranties of the Credit
Parties, and, to the best knowledge of the Credit Parties, the other parties to
the Documents (other than the Note Documents) that are set forth in such
Documents were true and correct in all material respects at the time as of
which such representations were made and will be true and correct in all
material respects on the Purchase Date. No condition exists which constitutes a
Default or an Event of Default.

 

6.                                       REPRESENTATIONS OF THE PURCHASERS.

 

6.1.          Purchase for Investment. Each
Purchaser represents that it is purchasing the Notes to be purchased by it
hereunder for its own account or for one or more separate accounts maintained
by such Purchaser and not with a view to the distribution thereof; provided
that the disposition of any such Person’s property shall at all times be within
such Person’s control. Each Purchaser understands that the Notes have not been
registered under the Securities Act and may be resold only if registered
pursuant to the provisions of the Securities Act or if an exemption from
registration is available, except under circumstances where neither such
registration nor such an exemption is required by applicable law.

 

6.2.          Accredited Investor. Each
Purchaser is an “accredited investor” (as defined in Rule 501 of
Regulation D under the Securities Act) and, by reason of its business and
financial experience, and the business and financial experience of those Persons
retained by it to advise it with respect to its investment in the Notes, such
Purchaser, together with such advisors, has such knowledge, sophistication and
experience in business and financial matters as to be capable of evaluating the
merits and risks of the prospective investment, is able to bear the economic
risk of such investment and, at the present time, is able to afford a complete
loss of such investment. Such Purchaser is not purchasing the Notes in reliance
upon any investigation made by any of the other Purchasers.

 

15

 

7.                                       PREPAYMENTS AND REPURCHASES OF THE NOTES.

 

7.1.          Optional Prepayments of the Notes.
The Companies may, at their option, upon not less than ten days’ prior notice
to the Agent and the holders of the Notes, prepay all or any portion of the
Notes, in an aggregate principal amount of $1,000,000 or integral multiples of
$100,000 in excess thereof (or, if less, the remaining aggregate principal
amount of all Notes outstanding at such time), at a purchase price in cash
equal to 100% of the face amount of the Notes so prepaid, plus all accrued and
unpaid interest thereon, if any, to the date of such prepayment. Each notice of
an optional prepayment of the Notes pursuant to this Section 7.1 shall specify
the date fixed for such prepayment, the aggregate principal amount of the Notes
to be prepaid on such date, the principal amount of each Note held by such
holder to be prepaid (determined in accordance with Section 7.4) and the
interest to be paid on the prepayment date with respect to such principal
amount being prepaid, and shall state that such prepayment is to be made
pursuant to this Section 7.1.

 

7.2.          Offer to Repurchase Notes Upon a
Change of Control.

 

(a)           Upon the occurrence of a Change of
Control, each holder of the Notes will have the right to require the Companies
to repurchase all or any portion (equal to $1,000,000 or an integral multiple
of $100,000 in excess thereof) of the Notes of such holder pursuant to an offer
made in the manner described below (each, a “Change of Control Offer”), at a purchase price in cash equal to
101% of the aggregate principal amount thereof, plus accrued and unpaid
interest thereon, if any, to the date of such repurchase (the “Change of
Control Payment”). Within 10 Business Days following any Change of Control, the
Company shall deliver a notice, by facsimile confirmed the same day by
overnight courier service, to each holder of the Notes stating:

 

(i)            that the Change of Control Offer is
being made pursuant to this Section 7.2 and that all Notes tendered shall
be accepted for repurchase;

 

(ii)           the parties and the events or
circumstances giving rise to the Change of Control for which such Change of
Control Offer is being made, in reasonable detail;

 

(iii)          the repurchase price for the Note or
Notes of such holder and the Change of Control Repurchase Date therefor;

 

(iv)          that any Note not tendered for
repurchase shall continue to accrue interest in accordance with the terms
thereof;

 

(v)           that, unless the Companies default in
the payment of the Change of Control Payment, all Notes accepted for repurchase
pursuant to the Change of Control Offer shall cease to accrue interest after
the Change of Control Repurchase Date; and

 

(vi)          that holders whose Notes are being
tendered for repurchase only in part shall be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered.

 

16

 

The
Companies shall comply with the requirements of Rule 14e-1 under the Exchange
Act and any other securities laws and regulations thereunder to the extent such
laws and regulations are applicable in connection with the repurchase of the
Notes as a result of a Change of Control. Any holder of the Notes that elects
to have all or a portion of its Notes repurchased as part of the Change of
Control Offer shall deliver notice to the Company of its election at least five
Business Days prior to the scheduled Change of Control Repurchase Date. Any
holder of a Note that does not deliver to the Companies notice accepting the
Change of Control Offer at least five Business Days prior to the Change of
Control Repurchase Date shall be deemed to have rejected such Change of Control
Offer. Notwithstanding the foregoing provisions of this subsection (a), the
failure of the Companies to deliver the notice referred to in the second
sentence of this subsection (a) to any holder of the Notes shall not affect or
impair the obligation of the Companies to purchase any Note from such holder on
the applicable Change of Control Repurchase Date.

 

(b)           On a date that is no earlier than 30
days nor later than 60 days from the date that the Companies deliver or cause
to be delivered notice of the Change of Control to the holders or, if the
Companies fail to deliver such notice or cause such notice to be delivered, on
the date that is 30 days after the occurrence of such Change of Control (the
“Change of Control Repurchase Date”), the Companies (i) shall, to the extent
lawful, accept for repurchase all Notes or portions thereof properly tendered
in response to the Change of Control Offer, (ii) shall pay to each of the
holders of the Notes so accepted the Change of Control Payment for its Notes
and (iii) shall deliver to each holder of Notes that only tendered a portion of
its Notes new Notes equal in aggregate principal amount to the unpurchased
portion of the Notes surrendered, if any, by such holder.

 

(c)           Notwithstanding the foregoing, the
Companies will not be required to make a Change of Control Offer if such action
is prohibited by the Senior Financing Agreement.

 

7.3.          Offer to Repurchase Notes in
Respect of an Asset Sale.

 

(a)           In the event that, pursuant to
Section 8.2(h), the Companies shall be required to commence an Asset Sale
Offer, the Companies shall make such Asset Sale Offer in the manner described
in subsection (b) of this Section 7.3.

 

(b)           Within 10 Business Days following
each date on which the Companies’ obligation to make an Asset Sale Offer is
triggered (the “Asset Sale Offer Trigger Date”), the Companies shall deliver a
notice, by facsimile confirmed the same day by overnight courier service, to
each holder of the Notes stating:

 

(i)            that the Asset Sale Offer is being
made pursuant to Section 7.3 and Section 8.2(h) and that the Companies
will purchase the aggregate principal amount of Notes required to be purchased
pursuant to Section 8.2(h) (the “Asset Sale Offer Amount”);

 

(ii)           the parties and the events or
circumstances giving rise to the Asset Sale for which such Asset Sale Offer is
being made, in reasonable detail;

 

17

 

(iii)          the repurchase price for the Note or
Notes of such holder and the Asset Sale Offer Payment Date therefor;

 

(iv)          that any Note not tendered for
repurchase shall continue to accrue interest in accordance with the terms
thereof;

 

(v)           that, unless the Companies default in
the payment of the Asset Sale Offer Amount, all Notes accepted for repurchase
pursuant to the Asset Sale Offer shall cease to accrue interest after the Asset
Sale Offer Payment Date; and

 

(vi)          that holders whose Notes are being
tendered for repurchase only in part shall be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered.

 

The
Companies shall comply with the requirements of Rule 14e-1 under the Exchange
Act and any other securities laws and regulations thereunder to the extent such
laws and regulations are applicable in connection with the repurchase of the
Notes as a result of an Asset Sale. Any holder of the Notes that elects to have
all or a portion of its Notes repurchased as part of the Asset Sale Offer shall
deliver notice to the Companies of its election at least five Business Days
prior to the scheduled Asset Sale Offer Payment Date. Any holder of a Note that
does not deliver to the Companies notice accepting the Asset Sale Offer at
least five Business Days prior to the Asset Sale Offer Payment Date shall be
deemed to have rejected such Asset Sale Offer. Notwithstanding the foregoing
provisions of this subsection (b), the failure of the Companies to deliver the
notice referred to in the second sentence of this subsection (b) to any holder
of the Notes shall not affect or impair the obligation of the Companies to
purchase any Note from such holder on the applicable Asset Sale Offer Payment
Date.

 

(c)           On a date that is no earlier than 30
days nor later than 60 days from the date that the Companies deliver or cause
to be delivered notice of the Asset Sale Offer Trigger Date to the holders or,
if the Companies fail to deliver such notice or cause such notice to be
delivered, on the date that is 30 days after the occurrence of such Asset Sale
Offer Trigger Date (the “Asset Sale Offer Payment Date”), the Companies (i)
shall, to the extent lawful, accept for repurchase all Notes or portions
thereof properly tendered in response to the Asset Sale Offer, (ii) shall pay
to each of the holders of the Notes so accepted such holder’s pro  rata
share of the Asset Sale Offer Amount for its Notes and (iii) shall deliver to
each holder of Notes that only tendered a portion of its Notes new Notes equal
in aggregate principal amount to the unpurchased portion of the Notes
surrendered, if any, by such holder.

 

(d)           Notwithstanding the foregoing, the
Companies will not be required to make an Asset Sale Offer if such action is
prohibited by the Senior Financing Agreement.

 

7.4.          Allocation of Partial Prepayments.
In the case of each partial prepayment or repurchase of the Notes pursuant to
Section 7.1, 7.2 or 7.3, the principal amount of the Notes to be prepaid,
repurchased or redeemed shall be allocated (in integral multiples of $1,000)
among all of the Notes at the time outstanding in proportion, as nearly as
practicable, to the respective unpaid principal amounts thereof not theretofore
called for prepayment or repurchase, with 

 

18

 

adjustments to the extent practicable to compensate
for any prior prepayments or repurchases not made exactly in such proportion.

 

7.5.          Maturity; Surrender, Etc. In
the case of each prepayment or repurchase of the Notes pursuant to
Section 7.1, 7.2 or 7.3, the principal amount of each Note to be prepaid
or repurchased shall mature and become due and payable on the date fixed for
such prepayment or repurchase, together with accrued and unpaid interest on
such principal amount to such date. From and after such date, unless the
Companies shall fail to pay such principal amount when so due and payable,
together with the accrued and unpaid interest thereon as aforesaid, interest on
such principal amount shall cease to accrue. Any Note prepaid or repurchased in
full shall be surrendered to the Companies and cancelled and shall not be
reissued, and no Note shall be issued in lieu of any prepaid or repurchased principal
amount of any Note.

 

7.6.          Purchase of Notes. The Parent
will not, and will cause Worldwide Excellerated Leasing Ltd. and its
Subsidiaries not to, purchase or otherwise acquire, directly or indirectly, any
of the outstanding Notes except upon the payment, prepayment or repurchase of
the Notes in accordance with the terms of this Agreement and the Notes. The
Companies will promptly cancel all Notes acquired by them pursuant to any
payment, prepayment or purchase of Notes in accordance with the terms of this
Agreement and the Notes, and no Notes may be issued in substitution or exchange
for any such Notes.

 

8.                                       COVENANTS OF THE PARENT AND THE COMPANIES.

 

8.1.          Affirmative Covenants. From the
date of this Agreement and thereafter, so long as any amount payable by the
Credit Parties under this Agreement, the Notes or any other Note Document shall
remain unpaid:

 

(a)           Financial Reporting. The
Parent will furnish to each Purchaser:

 

(i)            as soon as available and in any
event within 20 days after the end of each fiscal month of Vanguard Holdings,
commencing November 30, 2003, consolidated balance sheets, consolidated
statements of operations and retained earnings and consolidated statements of
cash flows of each of (A) Vanguard Holdings and its Subsidiaries and (B) Vanguard
and its Subsidiaries as of the end of such fiscal month and for the period
commencing at the end of the immediately preceding Fiscal Year and ending with
the end of such fiscal month, setting forth in each case in comparative form
the figures for the corresponding date or period of the immediately preceding
Fiscal Year (if available), all in reasonable detail and certified by an
Authorized Officer of Vanguard Holdings as fairly presenting, in all material
respects, the financial position and results of operations of such Person and
its Subsidiaries as of the end of such fiscal month and the results of
operations and cash flows of such Person and its Subsidiaries for such fiscal
month, in accordance with GAAP applied in a manner consistent with that of the
most recent audited financial statements of such Person and its Subsidiaries
furnished to the Agents and the Lenders, subject to normal year-end audit
adjustments;

 

(ii)           as soon as available and in any event
within 45 days after the end of each fiscal quarter of the Parent, commencing
March 31, 2004, consolidated balance 

 

19

 

sheets, consolidated statements of operations and
retained earnings and consolidated statements of cash flows of each of (A) the
Parent and its Subsidiaries and (B) Vanguard and its Subsidiaries as at the end
of such fiscal quarter, and for the period commencing at the end of the
immediately preceding Fiscal Year and ending with the end of such fiscal
quarter, setting forth in each case in comparative form the figures for the
corresponding date or period of the immediately preceding Fiscal Year (if
available), all in reasonable detail and certified by a Responsible Officer as
fairly presenting, in all material respects, the financial position of such
Person and its Subsidiaries as of the end of such fiscal quarter and the
results of operations and cash flows of such Person and its Subsidiaries for
such fiscal quarter, in accordance with GAAP applied in a manner consistent
with that of the most recent audited financial statements of such Person and
its Subsidiaries furnished hereunder, subject to normal year-end adjustments;

 

(iii)          as soon as available, and in any event
within 90 days after the end of each Fiscal Year of the Parent, consolidated
balance sheets, consolidated statements of operations and retained earnings and
consolidated statements of cash flows of each of (A) the Parent and its
Subsidiaries and (B) Vanguard and its Subsidiaries as at the end of such Fiscal
Year, setting forth in comparative form the corresponding figures for the
immediately preceding Fiscal Year (if available), all in reasonable detail and
prepared in accordance with GAAP, and accompanied by a report and an
unqualified opinion, prepared in accordance with generally accepted auditing
standards, of independent certified public accountants of recognized standing
selected by the Parent and reasonably satisfactory to the Agent (which opinion
shall be without (A) a “going concern” or like qualification or exception
or (B) any qualification or exception as to the scope of such audit),
together with a written statement of such accountants (1) to the effect
that, in making the examination necessary for their certification of such
financial statements, they have not obtained any knowledge of the existence of
an Event of Default or a Default and (2) if such accountants shall have
obtained any knowledge of the existence of an Event of Default or such Default,
describing the nature thereof;

 

(iv)          simultaneously with the delivery of
the financial statements required by clauses (ii) and (iii) of this
Section 8.1(a), a compliance certificate, in form and scope reasonably
acceptable to the Agent, signed on behalf of the Parent by a Responsible
Officer, stating that the Parent has caused to be taken a review of the
provisions of this Agreement and the other Note Documents and the condition and
operations of the Parent and its Subsidiaries during the period covered by such
financial statements with a view to determining whether the Parent and its
Subsidiaries were in compliance with all of the provisions of such Note
Documents at the times such compliance is required by the Note Documents, and
that such review has not disclosed the existence during such period of an Event
of Default or Default or, if an Event of Default or Default existed, describing
the nature and period of existence thereof and the action that the Parent and
its Subsidiaries propose to take or have taken with respect thereto;

 

(v)           (A) on or before November 30 of each year, commencing with the year
ending December 31, 2004, the annual budget of the Parent and its
Subsidiaries for the immediately succeeding Fiscal Year of the Parent and its
Subsidiaries, as presented to and approved by the Board of Directors of the
Parent and containing financial projections prepared on a fiscal month basis
and in reasonable detail, all such financial projections to be reasonable, to
be prepared on a reasonable basis and in good faith, and to be based on
assumptions believed by 

 

20

 

the Parent to be reasonable at the time made and
from the best information then available to the Parent;

 

(vi)          promptly after submission to any
Government Authority, all documents and information furnished to such
Government Authority in connection with any investigation of the Parent or any
of its Subsidiaries other than routine inquiries by such Governmental
Authority;

 

(vii)         as soon as possible, and in any event
within three days, after the occurrence of an Event of Default or Default or
the occurrence of any event or development that could reasonably be expected to
have a Material Adverse Effect, the written statement of a Responsible Officer
setting forth the details of such Event of Default, Default, other event,
development or Material Adverse Effect and the action which the Parent and its
Subsidiaries propose to take with respect thereto;

 

(viii)        promptly after the commencement thereof
but in any event not later than five days after service of process with respect
thereto on, or the obtaining of knowledge thereof by, any Credit Party, notice
of each action, suit or proceeding before any court or other Governmental
Authority or any arbitrator which, if adversely determined, could reasonably be
expected to have a Material Adverse Effect;

 

(ix)           to the extent not otherwise required
under any other clause of this Section 8.1(a), promptly after the sending or
filing thereof, copies of all material statements, reports and other
information the Parent or any of its Subsidiaries sends to any holders of its
Indebtedness or its securities or files with the SEC or any national (domestic
or foreign) securities exchange;

 

(x)            promptly upon receipt thereof,
copies of all financial reports (including management letters), if any,
submitted to any Credit Party by its auditors in connection with any annual or
interim audit of the books thereof;

 

(xi)           as soon as possible, and in any event
within five days, after execution, receipt or delivery thereof, copies of any
material notices that any Credit Party executes or receives in connection with
the sale, transfer or any other disposition of the Capital Stock of, or all or
substantially all of the assets of, any Credit Party;

 

(xii)          promptly upon delivery or receipt by
any Credit Party, copies of all material notices delivered or received by any
Credit Party under any Document (other than a Note Document); and

 

(xiii)         promptly upon request, such other
information concerning the condition or operations, financial or otherwise, of
the Parent or any of its Subsidiaries as the Agent or the Required Holders may
from time to time may reasonably request.

 

(b)           Compliance with Laws, Etc.
Each of the Parent and the Companies will comply, and the Companies will cause
each of their respective Restricted Subsidiaries to comply, in all material
respects with all applicable laws, rules, regulations and orders (including,
without limitation, ERISA and all Environmental Laws), such compliance to 

 

21

 

include, without limitation, (i) paying before the
same become delinquent all taxes, assessments and governmental charges or
levies imposed upon it or upon its income or profits or upon any of its
properties, and (ii) paying all lawful claims which if unpaid might become
a Lien or charge upon any of its properties, except to the extent contested in
good faith by proper proceedings which stay the imposition of any penalty, fine
or Lien resulting from the non-payment thereof and with respect to which adequate
reserves have been set aside for the payment thereof in accordance with GAAP,
the noncompliance with which in each such case could reasonably be expected to
have a Material Adverse Effect.

 

(c)           Preservation of Corporate
Existence, Etc.

 

(i)            Each of the Parent and the Companies
will preserve and keep in full force and effect, and the Companies will cause
each of their respective Restricted Subsidiaries to preserve and keep in full
force and effect, (A) its corporate (or other) existence and good standing in
its jurisdiction of organization and (B) all of its permits, licenses,
approvals, rights, privileges and franchises; provided, however,
that nothing in this Section 8.1(c) shall prevent any of the Companies’
Restricted Subsidiaries from terminating or failing to preserve and keep in
full force and effect any such permit, license, approval, right, privilege or
franchise if the Companies have determined in their good faith judgment that
such termination or failure to preserve could not reasonably be expected to
have a Material Adverse Effect.

 

(ii)           Each of the Parent and the Companies
will, and the Companies will cause each of their respective Restricted
Subsidiaries to, duly qualify and remain duly qualified as a foreign
corporation or other entity, and be and remain in good standing, in each
jurisdiction in which the ownership, lease or operation of its property and
assets or the conduct of its businesses requires such qualification, except in
any such jurisdiction in which the failure to be so qualified or in good
standing could not reasonably be expected to have a Material Adverse Effect.

 

(d)           Keeping of Records and Books of
Account. Each of the Parent and the Companies will keep, and the Companies
will cause each of their respective Subsidiaries to keep, proper records
and books of account, with complete entries made of all financial transactions
in accordance with GAAP and applicable law.

 

(e)           Inspection Rights. Each of the
Parent and the Companies will permit the Agent or any agents or representatives
thereof upon three days prior notice during normal business hours, to examine
and make copies of abstracts from the records and books of account of such
Credit Party and its Subsidiaries; provided that no notice by the Agent
or any Purchaser shall be required upon the occurrence and during the
continuance of an Event of Default. The Companies agree to pay the reasonable
cost of (i) not more than two such examinations in any consecutive twelve month
period so long as no Event of Default shall have occurred and be continuing and
(ii) all such examinations if an Event of Default shall have occurred and be
continuing.

 

(f)            Maintenance of Properties, Etc. Each
of the Parent and the Companies will maintain and preserve, and the Companies
will cause each of their respective 

 

22

 

Restricted Subsidiaries to maintain and preserve,
all of its properties that are necessary or useful in the proper conduct of its
business in good working order and condition, ordinary wear and tear excepted,
and comply, at all times with the provisions of all leases to which it is a
party as lessee or under which it occupies property, so as to prevent any loss
or forfeiture thereof or thereunder.

 

(g)           Maintenance of Insurance. Each
of the Parent and the Companies will maintain, and the Companies will cause
each of their respective Restricted Subsidiaries to maintain, self insurance
and insurance with responsible and reputable insurance companies or
associations (including comprehensive general liability, casualty and business
interruption insurance) with respect to its properties (including all real
properties leased or owned by them) and business, in such amounts and covering
such risks as is required by any Governmental Authority having jurisdiction
with respect thereto or as is carried generally in accordance with sound
business practice by companies in similar businesses similarly situated.

 

(h)           Obtaining of Permits, Etc. Each
of the Parent and the Companies will obtain, maintain and preserve and take all
necessary action to timely renew, and the Companies will cause each of their
respective Restricted Subsidiaries to obtain, maintain and preserve and take
all necessary action to timely renew, all permits, licenses, authorizations,
approvals, entitlements and accreditations which are necessary in the proper
conduct of its business except to the extent that the failure to obtain,
maintain, preserve or renew the same could not reasonably be expected to have a
Material Adverse Effect.

 

(i)            Environmental Matters. Each
of the Parent and the Companies will (i) keep any property either owned or
operated by it or any of its Restricted Subsidiaries free of any Environmental
Liens; (ii) comply, in all material respects with Environmental Laws;
(iii) promptly provide the Collateral Agent with written notice within 10
days of the receipt of any of the following: 
(A) notice that an Environmental Lien has been filed against any
property of any Credit Party or any of its Restricted Subsidiaries;
(B) commencement of any Environmental Action or notice that an
Environmental Action will be filed against any Credit Party or any of its
Restricted Subsidiaries; and (C) notice of a violation, citation or other
administrative order which is reasonably likely to have a Material Adverse
Effect; and (iv) defend, indemnify and hold harmless, each of the Agent
and the Purchasers and their respective transferees, and the respective
employees, agents, officers and directors thereof, from and against any claims,
demands, penalties, fines, liabilities, settlements, damages, costs or expenses
(including reasonable attorney and consultant fees, investigation and
laboratory fees, court costs and litigation expenses) arising out of
(A) the presence, disposal, release or threatened release of any Hazardous
Materials on any property at any time owned or occupied by any Credit Party or
any of its Restricted Subsidiaries (or its respective predecessors in interest
or title), (B) any personal injury (including wrongful death) or property
damage (real or personal) arising out of or related to such Hazardous
Materials, (C) any investigation, lawsuit brought or threatened,
settlement reached or government order relating to such Hazardous Materials,
(D) any violation of any Environmental Law by such Credit Party or any of
its Restricted Subsidiaries and/or (E) any Environmental Actions filed against
the Agent, any Purchaser or any transferee thereof or other such indemnified
Person.

 

(j)            Further Assurances. Each of
the Parent and the Companies will take such action and execute, acknowledge and
deliver at its sole cost and expense, such 

 

23

 

agreements, instruments or other documents as the
Agent or any Purchaser may reasonably require from time to time in order
(i) to carry out more effectively the purposes of this Agreement and the
other Note Documents, (ii) to subject to valid and perfected third
priority Liens any of the Collateral, subject only to Liens granted in favor of
the Senior Agent pursuant to the Senior Financing Documents, (iii) to
establish and maintain the validity and effectiveness of any of the Note
Documents and the validity, perfection and priority of the Liens intended to be
created thereby, and (iv) to better assure, convey, grant, assign,
transfer and confirm unto the rights now or hereafter intended to be granted to
the Agent or any Purchaser under this Agreement or any other Note Document.

 

(k)           Fiscal Periods The Parent will
cause the Fiscal Years, the fiscal quarters and the fiscal months to remain as
currently in effect, unless the Required Holders consent to a change in such
Fiscal Year or other fiscal periods.

 

(l)            Subsidiary Guaranties. The
Companies shall, within 10 Business Days after the formation or acquisition of
any Restricted Subsidiary, (i) cause such Restricted Subsidiary to execute and
deliver to the Agent a Subsidiary Guaranty and (ii) cause to be delivered to
the Agent an opinion of counsel, in form and substance reasonably satisfactory
to the Agent, that such Subsidiary Guaranty is a valid and legally binding
obligation of such Subsidiary Guarantor, provided, in each such case
that a comparable guaranty is also required to be executed and delivered
pursuant to the terms of the Senior Financing Agreement and that upon the
release or termination of such comparable guaranty, such Subsidiary Guaranty
shall, so long as no Event of Default shall have occurred and be continuing,
automatically terminate.

 

(m)          Additional Collateral Security.
The Companies shall, within 10 Business Days after the formation or
acquisition of any Finance Company of the Company, execute and deliver, or
cause each owner of any Capital Stock of such Finance Company to execute and
deliver a supplement to the Pledge Agreement, together with (i) certificates
evidencing all of the shares of Capital Stock of such Finance Company or if
such Capital Stock is subject to a Lien granted in favor of the Senior Agent
pursuant to the Senior Financing Agreement, copies of such certificates; provided
that upon payment in full of the Indebtedness under the Senior Financing
Agreement, the original certificates shall be delivered to the Agent together
with undated stock powers executed in blank with signature guaranteed, and such
opinion of counsel and such approving certificate of such Subsidiary as the
Agent may reasonably request in respect of complying with any legend on any
such certificate or any other matter relating to such shares, and (ii) 
such other agreements, instruments, approvals, legal opinions or other
documents requested by the Agent.

 

8.2.          Negative Covenants. From the
date of this Agreement and thereafter, so long as any amount payable by the
Credit Parties under this Agreement, the Notes or any other Note Document shall
remain unpaid:

 

(a)           Limitation on Indebtedness.

 

(i)            Neither the Parent nor any of the
Companies will, and the Companies will not permit any of their respective
Restricted Subsidiaries to, directly or indirectly, create, issue, assume,
guarantee or otherwise become directly or indirectly liable, 

 

24

 

contingently or otherwise, for the payment of, or
otherwise incur, including by way of merger, consolidation or acquisition
(collectively, “incur”), any Indebtedness (including Acquired Indebtedness and
the issuance of Disqualified Stock), except any of the Credit Parties and the
Subsidiary Guarantors may incur Indebtedness (including the issuance of
Disqualified Stock) if, at the time of such incurrence, the Consolidated Fixed
Charge Coverage Ratio would, after giving effect to such incurrence or issuance
and the application of the proceeds thereof, have been at least 2.25 to 1.0.

 

(ii)           Notwithstanding the foregoing, the
Credit Parties and the Subsidiary Guarantors may incur any of the following
Indebtedness (“Permitted Indebtedness”):

 

(A)          Indebtedness of the Credit Parties and
the Subsidiary Guarantors under the Note Documents;

 

(B)           Indebtedness of the Credit Parties
and their Restricted Subsidiaries under the Senior Financing Agreement in an
aggregate principal amount not to exceed $150,000,000 at any one time
outstanding;

 

(C)           Indebtedness of the Credit Parties
under the Junior Subordinated Indebtedness Documents in an aggregate principal
amount not to exceed $140,000,000, plus the amount of any interest
thereon capitalized in accordance with the terms thereof;

 

(D)          Indebtedness of the Credit Parties and
Restricted Subsidiaries outstanding on the Purchase Date and listed on Schedule
8.1(a)(ii);

 

(E)           Indebtedness of a Credit Party or a
Subsidiary Guarantor to another Credit Party or Subsidiary Guarantor so long as
such Indebtedness is held by a Credit Party or a Subsidiary Guarantor or the
holder of a Permitted Lien thereon and provided such Indebtedness owing by a
Company is subordinated in right of payment to the payment of the Obligations
pursuant to a written agreement satisfactory to the Agent;

 

(F)           Indebtedness represented by Capital
Lease Obligations, mortgage financings or purchase money obligations, in each
case incurred for the purpose of financing all or any part of the purchase
price, lease expense, cost of construction, repair or improvement of or
addition to property, plant or equipment used in the business of such Credit
Party or such Restricted Subsidiary, the Capital Stock of a Restricted
Subsidiary that owns such property, plant or equipment, in an aggregate
principal amount, including all Permitted Refinancing Indebtedness incurred to
refund, refinance or replace Indebtedness incurred pursuant to this clause (F),
not to exceed $25,000,000 at any time outstanding;

 

(G)           Hedging Obligations that are incurred
in the normal course of business for the purpose of fixing or hedging currency,
commodity or interest rate risk (including with respect to any floating rate
Indebtedness that is permitted by the terms of this Agreement to be
outstanding) and not for speculative purposes ;

 

(H)          the guarantee by any Credit Party or
any Restricted Subsidiary of Indebtedness of any other Credit Party or
Restricted Subsidiary that was permitted 

 

25

 

to be incurred by another provision of this Section
8.2(a) or other obligations (including obligations under the operating leases)
permitted to be incurred hereunder of any other Credit Party or Restricted Subsidiary
of a Credit Party;

 

(I)            Contingent Obligations (including
obligations under leases, indemnification and guarantee obligations) in respect
of Indebtedness and other obligations of Unrestricted Subsidiaries incurred in
the ordinary course of business in connection with the financing of vehicles
used in Permitted Businesses of such Unrestricted Subsidiaries;

 

(J)            Indebtedness represented by
guarantees or other Contingent Obligations in favor of airports, airport
authorities and other Governmental Authorities for the construction of airport
rental or related facilities to be used by any Company or any Restricted
Subsidiary in the ordinary course of business that do not exceed in the
aggregate $50,000,000 at any time outstanding;

 

(K)          Indebtedness to finance the payment of
insurance premiums and Indebtedness incurred in respect of workers’
compensation claims, self-insurance obligations, performance, surety, insurance
and similar bonds and completion guarantees provided by any Credit Party or any
Restricted Subsidiary in the ordinary course of business;

 

(L)           Indebtedness arising from agreements
of any Credit Party or any Restricted Subsidiary providing for indemnification,
adjustment of purchase price or similar obligations, in each case, incurred or
assumed in connection with the disposition of any business, assets or Capital
Stock of a Restricted Subsidiary;

 

(M)         Indebtedness arising from the honoring
by a bank or other financial institution of a check, draft or similar
instrument (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business, provided that such
Indebtedness is extinguished within five Business Days of incurrence;

 

(N)          Indebtedness of a Restricted
Subsidiary incurred and outstanding on or prior to the date on which such
Person was acquired by a Company or a Restricted Subsidiary (other than
Indebtedness incurred in connection with or in contemplation of, or to provide
all or any portion of the funds or credit support utilized to consummate, the
transaction or series of related transactions pursuant to which such Person was
acquired by a Company or a Restricted Subsidiary); provided, however, that on
the date of such acquisition and after giving effect thereto, the Companies
would have been able to incur at least $1.00 of additional Indebtedness
pursuant to Section 8.2(a)(i);

 

(O)          Indebtedness incurred in connection
with the acquisition of vehicles directly from the manufacturer thereof,
provided, that such Indebtedness does not exceed the net book value of such
vehicles and no Event of Default shall exist after giving effect thereto and
the use of proceeds thereof;

 

(P)           purchase money Indebtedness of a
Company or any of its Restricted Subsidiaries incurred in connection with the
purchase of a franchisee in an aggregate amount for all Companies and their
Restricted Subsidiaries not to exceed $5,000,000 at any time outstanding;

 

26

 

(Q)          Additional Indebtedness of the
Companies or any of their Restricted Subsidiaries in an aggregate principal
amount for all Companies and their Restricted Subsidiaries not to exceed
$10,000,000 at any time outstanding; and

 

(R)           Permitted Refinancing Indebtedness;

 

provided, however, that no Permitted
Indebtedness described in clause (N) and (R) above may be incurred if after
giving effect to the incurrence of such Indebtedness and the use of the
proceeds thereof, an Event of Default shall exist.

 

(iii)          For purposes of determining compliance
with this Section 8.2(a), in the event that an item of proposed Indebtedness
meets the criteria of more than one of the categories of Permitted Indebtedness
described in clauses (A) through (R) of this Section 8.2(a) as of the date of
incurrence thereof or is entitled to be incurred pursuant to paragraph (i) of
this Section 8.2(a) as of the date of incurrence thereof, the Companies shall,
in their sole discretion, classify (or later reclassify in whole or in part, in
their sole discretion) such item of Indebtedness in any manner that complies
with this Section 8.2(a). Accrual of interest, accrual of dividends, the
accretion of accreted value and the payment of interest in the form of
additional Indebtedness and the payment of dividends on Disqualified Stock or
preferred stock in the form of additional shares of the same class of
Disqualified Stock or preferred stock will not be deemed to be an incurrence of
Indebtedness or an issuance of Disqualified Stock or preferred stock for
purposes of this covenant.

 

(iv)          For purposes of determining compliance
with any U.S. dollar-denominated restriction on the incurrence of Indebtedness
denominated in a foreign currency, the U.S. 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, provided that if such Indebtedness is incurred to refinance other
Indebtedness denominated in a foreign currency, and such refinancing would
cause the applicable U.S. dollar-denominated restriction to be exceeded if
calculated at the relevant currency exchange in effect on the date of such
refinancing, such U.S. 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.

 

(b)           Limitation on Restricted Payments.

 

(i)            Neither the Parent nor any of the
Companies will, and the Companies will not permit any of their respective Restricted
Subsidiaries to, directly or indirectly:

 

(A)          declare or pay any dividend on, or
make any distribution to holders of, any shares of the Capital Stock of the
Parent or any Company or any Restricted Subsidiary, other than such dividends
or distributions that are payable to the Parent or a Company or payable in
Capital Stock (other than Disqualified Stock) of the Parent or a Company;

 

27

 

(B)           purchase, redeem or otherwise acquire
or retire for value, directly or indirectly, any shares of Capital Stock (or
any options, warrants or other rights to acquire shares of Capital Stock) of
the Parent or any Company;

 

(C)           make any principal payment on, or
repurchase, redeem, defease or otherwise acquire or retire for value, prior to
any scheduled principal payment, sinking fund payment or maturity, any Junior
Subordinated Indebtedness or any other Indebtedness that is subordinated in
right of payment to the Notes; or

 

(D)          make any Investment (other than a
Permitted Investment) in any Person;

 

(such
payments or other actions described in (but not excluded from) clauses (A)
through (D) being referred to as “Restricted Payments”); unless:

 

(1)           no Default or Event of Default has
occurred and is continuing or would otherwise occur as a consequence thereof;

 

(2)           the Companies could incur at least
$1.00 of additional Indebtedness pursuant to subsection (i) of
Section 8.2(a); and

 

(3)           the aggregate amount of all
Restricted Payments (including such Restricted Payment) declared or made after
the Purchase Date does not exceed the sum of (without duplication).

 

(w)          50%
of Consolidated Adjusted Net Income, determined on a cumulative basis for the
applicable Reference Period (or, if such aggregate cumulative Consolidated
Adjusted Net Income is a loss, minus 100% of such amount); plus

 

(x)            the
aggregate net cash proceeds received by the Parent and its Restricted
Subsidiaries after the Purchase Date from the issuance or sale (other than to a
Subsidiary of the Parent) of Qualified Equity Interests of the Parent, or any
other equity contributions received by the Parent or any of its Restricted
Subsidiaries after the Purchase Date (excluding any such proceeds used to
redeem Notes); plus

 

(y)           the
aggregate net cash proceeds received by the Parent and its Restricted
Subsidiaries after the Purchase Date from the issuance or sale (other than to a
Subsidiary of the Parent) of debt securities or Disqualified Stock that have
been converted into or exchanged for Qualified Stock of the Parent, together
with the aggregate net cash proceeds received by the Parent at the time of such
conversion or exchange; plus

 

(z)            the
sum of (I) without duplication of any amounts included in Consolidated Adjusted
Net Income in clause (w) above, the aggregate amount paid in cash or Cash
Equivalents to any 

 

28

 

Company
or a Restricted Subsidiary on or with respect to Investments (other than
Permitted Investments) made subsequent to the Purchase Date whether through
interest payments, principal payments, dividends or other distributions or
payments, (II) the net cash proceeds received by any Company or any Restricted
Subsidiary from the disposition of all or any portion of such Investments
(other than to a Restricted Subsidiary) and (III) upon redesignation of an
Unrestricted Subsidiary as a Restricted Subsidiary, the Fair Market Value of
such Subsidiary; provided, however, that the sum of clauses (I),
(II) and (III) above shall not exceed the aggregate amount of all such Investments
made subsequent to the Purchase Date.

 

(ii)           Notwithstanding the provisions of
Section 8.2(b)(i), any of the Credit Parties and the Restricted Subsidiaries
may take any of the following actions:

 

(A)          the payment of any dividend within 60
days after the date of declaration thereof, if at the declaration date such
payment would not have been prohibited by the foregoing provisions;

 

(B)           the repurchase, redemption or other
acquisition or retirement for value of any shares of Capital Stock of the
Parent or Vanguard, in exchange for, or out of the net cash proceeds of, a
substantially concurrent issuance and sale (other than to a Subsidiary of the
Parent) of, Qualified Equity Interests of the Parent or Vanguard;

 

(C)           the purchase, redemption, defeasance
or other acquisition or retirement for value of Subordinated Indebtedness in
exchange for, or out of the net cash proceeds of, a substantially concurrent
issuance and sale (other than to a Subsidiary of the Parent) of Qualified
Equity Interests of the Parent or Vanguard;

 

(D)          the purchase, redemption, defeasance
or other acquisition or retirement for value of Subordinated Indebtedness in
exchange for, or out of the net cash proceeds of, a substantially concurrent
issuance or sale (other than to a Subsidiary of the Parent) of, Permitted
Refinancing Indebtedness;

 

(E)           the repurchase of any Subordinated
Indebtedness at a purchase price not greater than 101% of the principal amount
of such Subordinated Indebtedness in the event of a “change of control” in
accordance with provisions similar to Section 7.2; provided that,
prior to such repurchase, the Parent has made the Change of Control Offer as
provided in such Section with respect to the Notes and has repurchased all
Notes validly tendered for payment in connection with such Change of Control
Offer;

 

(F)           Restricted Payments for the purchase,
redemption, acquisition, cancellation or other retirement for value of shares
of Capital Stock of the Parent; provided that the aggregate cash
consideration paid for such purchase, redemption, acquisition, cancellation or
other retirement of such shares of Capital Stock after the Purchase Date does
not exceed $50,000 in any Fiscal Year;

 

29

 

(G)           dividends by the Companies to the Parent
or by the Parent to Worldwide in amounts necessary to pay (A) customary
administrative expenses (including reasonable directors’ fees) of the Parent
and Worldwide in the ordinary course of their respective businesses and in an
aggregate amount not to exceed in any Fiscal Year $2,500,000, and taxes when
due and owing by the Parent or Worldwide; and

 

(H)          repurchases in whole or in part by
Vanguard of outstanding shares of its Series A Preferred Stock;

 

so
long as, in the case of any Restricted Payment described in clause (D) or (H),
no Default or Event of Default shall exist immediately after giving effect to
such Restricted Payment.

 

The
payments described in clauses (B) (as to the proceeds of an issuance and sale
of Qualified Equity Interests), (C), (E), (F), (G) and (H) of this paragraph
will be Restricted Payments that will be permitted to be taken in accordance
with this paragraph but will reduce the amount that would otherwise be
available for Restricted Payments under clause (3)(z) of Section 8.2 (b)(i) and
the payments described in clauses (A), (B) (except as provided above) and
(D) of this paragraph will be Restricted Payments that will be permitted to be
taken in accordance with this paragraph and will not reduce the amount that
would otherwise be available for Restricted Payments under the clause (3)(z) of
Section 8.2(b)(i).

 

(iii)          For the purpose of making any
calculations under this Agreement (A) if a Restricted Subsidiary is
designated an Unrestricted Subsidiary, the Parent will be deemed to have made
an Investment in amount equal to the Fair Market Value of the net assets of
such Restricted Subsidiary at the time of such designation, (B) any
property transferred to or from an Unrestricted Subsidiary will be valued at
Fair Market Value at the time of such transfer, and (C) subject to the
foregoing, the amount of any Restricted Payment, if other than cash, will be
determined by the Board of Directors of the Parent, whose good faith
determination will be conclusive.

 

(c)           Limitation on Dividends and Other
Payment Restrictions Affecting Restricted Subsidiaries. Neither the Parent
nor any of the Companies will, and the Companies will not permit any of their
respective Restricted Subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any Restricted
Subsidiary of any of the Companies to (i) pay dividends, in cash or
otherwise, or make any other distributions on or in respect of its Capital
Stock, (ii) pay any Indebtedness owed to any Credit Party or Restricted
Subsidiary, (iii) make loans or advances to any Credit Party or Restricted
Subsidiary or (iv) transfer any of its properties or assets to any Credit
Party or Restricted Subsidiary except for such encumbrances or restrictions
existing under or by reason of any of the following:

 

(A)          the Documents and any other agreement
in effect on the Purchase Date and any amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings
thereof, provided that such amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings are no more
restrictive, taken as a whole, with respect to dividend and other payment
restrictions than those contained in such agreements as in effect on the
Purchase Date;

 

30

 

(B)                                in the case of clause (iv) above, (1) agreements or
instruments that restrict in a customary manner the subletting, assignment or
transfer of any property or asset that is a lease, license, conveyance or
contract or similar property or asset, (2) any transfer of, agreement to
transfer, option or right with respect to, or Lien on, any property or assets
of any Company or any Restricted Subsidiary not otherwise prohibited by this
Indenture or (C) provisions arising or agreed to in the ordinary course of
business not relating to Indebtedness that do not, individually or in the
aggregate, detract from the value of property or assets of any Company or any
of its Restricted Subsidiaries or the ability of the Company or such Restricted
Subsidiary, as the case may be, to use such property or assets, in each
case in any manner material to such Company or any of its Restricted
Subsidiaries;

 

(C)                                any agreement or instrument governing Acquired Indebtedness, which
encumbrance or restriction is not applicable to any Person, or the properties
or assets of any Person, other than the Person or the properties or assets of
the Person so acquired;

 

(D)                               provisions in agreements or instruments that prohibit the payment of
dividends or the making of other distributions with respect to any Capital
Stock of a Person other than on a pro rata basis;

 

(E)                                 restrictions on the transfer of assets
subject to any Permitted Lien imposed by the holder of such Lien;

 

(F)                                 restrictions imposed by any agreement to sell
assets or Capital Stock permitted under this Agreement to any Person pending
the closing of such sale;

 

(G)                                provisions in joint venture agreements and other similar agreements (in
each case relating solely to the respective joint venture or similar entity or
the equity interests therein) entered into in the ordinary course of business;

 

(H)                               restrictions contained in the terms of the purchase money Indebtedness
or Capitalized Lease Obligations not incurred in violation of this Indenture; provided,
that such restrictions relate only to the property financed with such
Indebtedness;

 

(I)                                    restrictions contained in the terms of
Indebtedness incurred in compliance with Section 8.2(a); provided that
such restrictions, taken as a whole, are, in the good faith judgment of the
Parent’s Board of Directors, no more materially restrictive with respect to
such encumbrances and restrictions than those contained in the existing
agreements referenced in clause (A) above;

 

(J)                                   restrictions on cash or other deposits
imposed by customers under contracts or other arrangements entered into or
agreed to in the ordinary course of business;

 

(K)                               an agreement governing Permitted Refinancing Indebtedness incurred to
Refinance the Indebtedness issued, assumed or incurred pursuant to an agreement
referred to in clause (A) or (C) above; provided, however,
that the provisions relating to such encumbrance or restriction contained in
any such Indebtedness are no less favorable to

 

31

 

any
Company or Restricted Subsidiary in any material respect as determined by the
Board of Directors of the Parent in its reasonable and good faith judgment than
the provisions relating to such encumbrance or restriction contained in
agreements referred to in such clause (A) or (C).

 

(d)                                 Limitation
on Issuances and Sales of Capital Stock of Restricted Subsidiaries.
Neither the Parent nor any Company will, directly or indirectly, sell, and the
Companies will not permit any of their respective Restricted Subsidiaries to
issue or sell, any shares of the Capital Stock of any Restricted Subsidiary or
any options, warrants or other rights to purchase shares of such Capital Stock
except (i) to the Parent or any Company, or (ii) if, immediately
after giving effect to such issuance or sale, (A) neither the Parent nor
any of its Restricted Subsidiaries owns any shares of Capital Stock of such
Company or Subsidiary or any options, warrants or other rights to purchase
shares of such Capital Stock and (B) such issuance or sale is made in
compliance with this Agreement.

 

(e)                                  Limitation
on Other Senior Subordinated Indebtedness.
Neither the Parent nor any of the Companies will incur or otherwise permit to
exist, and the Companies will not permit any of their respective Restricted
Subsidiaries to incur or otherwise permit to exist, any Indebtedness that is
subordinate in right of payment to any of its senior Indebtedness unless such
Indebtedness is also subordinate in right of payment to the Notes or its
Subsidiary Guaranty, as the case may be, to at least the same extent as
the Notes or such Subsidiary Guaranty are subordinate in right of payment to
senior Indebtedness of such Credit Party or such Restricted Subsidiary, as the
case may be, as set forth in the applicable Intercreditor Agreement.

 

(f)                                    Limitation
on Liens. Neither the Parent nor
any of the Companies will create, incur or otherwise permit to exist, and the
Companies will not permit any of their respective Restricted Subsidiaries to
create, incur or otherwise permit to exist, any Lien of any kind (other than
Permitted Liens) upon any property or assets (including any intercompany notes)
of such Credit Party or such Restricted Subsidiary, or any income or profits
therefrom, unless the Notes or Subsidiary Guaranty, as the case may be,
are directly secured equally and ratably with (or prior to in the case of
Subordinated Indebtedness) the obligation or liability secured by such Lien.

 

(g)                                 Limitation
on Transactions with Affiliates.

 

(i)                                     Neither
the Parent nor any of the Companies will, and the Companies will not permit any
of their respective Restricted Subsidiaries to, directly or indirectly, enter
into or suffer to exist any contract, agreement, arrangement or transaction
with, or for the benefit of, any of its Affiliates (an “Affiliate Transaction”)
unless (i) the Parent’s Board of Directors determines that such Affiliate
Transaction is on terms that are fair and reasonable to such Credit Party or
such Restricted Subsidiary, as the case may be, and are no less favorable
to such Credit Party or such Restricted Subsidiary, as the case may be,
than those that could have been obtained in an arm’s length transaction with
third parties who are not Affiliates, and (ii) with respect to any
Affiliate Transaction involving aggregate payments in excess of $5,000,000, the
Parent delivers an officers’ certificate to the Agent certifying that such
Affiliate Transaction complies with clause (i) above and has been
approved by the Board of Directors of the Parent.

 

32

 

(ii)                                  The
restrictions set forth in Section 8.2(g)(i) shall not apply to:

 

(A)                              reasonable
fees and compensation paid to and indemnity provided on behalf of officers,
directors, employees or consultants of the Parent or any of its Restricted
Subsidiaries as determined in good faith by the Parent’s Board of Directors or
senior management;

 

(B)                                transactions
exclusively between or among the Parent and any of its Restricted Subsidiaries
or exclusively between or among such Restricted Subsidiaries;

 

(C)                                any
agreement as in effect as of the Purchase Date or any amendment thereto or any
transaction contemplated thereby (including pursuant to any amendment thereto
and any extension of the maturity thereof) and any replacement agreement
thereto so long as any such amendment or replacement agreement is not
materially more disadvantageous to the holders of the Notes, in any material
respect than the original agreement as in effect on the Purchase Date;

 

(D)                               Restricted
Payments permitted by this Agreement;

 

(E)                                 any
employment, stock option, stock repurchase, employee benefit compensation,
business expense reimbursement, severance, termination or other
employment-related agreements, arrangements or plans entered into by the Parent
or any of its Restricted Subsidiaries in the ordinary course of business;

 

(F)                                 transactions
relating to the issuance of Qualified Capital Stock of, or any other equity
investment in, any Credit Party, including the granting of registration rights
with respect thereto;

 

(G)                                Permitted
Investments; and

 

(H)                               any
transaction on arm’s-length terms with a non-Affiliate that becomes an
Affiliate as a result of such transaction.

 

(h)                                 Limitation
on Certain Asset Sales.

 

(i)                                     Neither
the Parent nor any of the Companies will, and the Companies will not permit any
of their respective Restricted Subsidiaries to, directly or indirectly,
consummate any Asset Sale, unless:  (A) the
consideration received by the applicable Credit Party or Restricted Subsidiary
with respect to such Asset Sale is at least equal to the Fair Market Value of
the assets or Capital Stock issued or sold or otherwise disposed of; and (B) the
consideration received by the applicable Credit Party or Restricted Subsidiary
with respect to such Asset Sale consists of at least 75% (1) cash and/or
Cash Equivalents or Qualified Consideration received at the time of
disposition, (2) any liabilities, other than Subordinated Indebtedness, of
the applicable Credit Party or Restricted Subsidiary that are assumed by the
transferee of any such assets pursuant to an agreement that immediately
releases such Credit Party or Restricted Subsidiary from all liability in
respect thereof; or (3) securities, notes or other

 

33

 

obligations
received by such Credit Party or Restricted Subsidiary from such transferee
that are converted by such Credit Party or Restricted Subsidiary into cash
and/or Cash Equivalents or Qualified Consideration within 90 days of the
date of such Asset Sale (to the extent of the cash and/or Cash Equivalents or
Qualified Consideration received).

 

(ii)                                  In
the event of any such Asset Sale the Companies may, at their option, within 360
days following the receipt of the Net Cash Proceeds from such Asset Sale, (A) apply
all or a portion of such Net Cash Proceeds to the permanent reduction of
amounts outstanding under the Senior Financing Agreement (which, in the case of
a revolver or similar arrangement, also permanently reduces the commitment
under such facility by the same amount) or (B) invest (or enter into a
legally binding agreement to invest) all or a portion of such Net Cash Proceeds
in properties and assets to replace the properties and assets that were the
subject of the Asset Sale or in properties and assets that will be used in
businesses of the Companies as permitted hereunder or (C) a combination of
the foregoing clauses (A) and (B). The amount of such Net Cash Proceeds
not so used as set forth in this subsection (ii) constitutes “Excess
Proceeds”.

 

(iii)                               When
the aggregate amount of Excess Proceeds equals or exceeds $10 million, the
Companies, in accordance with Section 7.3, shall make an offer (an “Asset
Sale Offer”) to all holders of Notes, to purchase, on a pro  rata
basis, the maximum principal amount of Notes that may be purchased out of
the Excess Proceeds, at a purchase price in cash in an amount equal to 100% of
the aggregate principal amount of the Notes, plus accrued and unpaid interest
thereon to the date of purchase (subject to the right of holders of Notes as of
the relevant record date to receive interest due on the relevant interest
payment date). To the extent that any Excess Proceeds remain after consummation
of an Asset Sale Offer, the Companies may use such Excess Proceeds for any
purpose not otherwise prohibited by this Agreement. If the aggregate principal
amount of Notes tendered into such Asset Sale Offer surrendered by holders
thereof exceeds the amount of Excess Proceeds, the Agent shall select the Notes
to be purchased or retired on a pro  rata basis in proportion to
the respective principal amounts of the Notes. Upon completion of such Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero for purposes
of the first sentence of this subsection.

 

(i)                                     Limitation
on Unrestricted Subsidiaries.

 

(i)                                     The
Board of Directors of the Parent may designate any of its Subsidiaries
(including any newly acquired or newly formed Subsidiary) to be an Unrestricted
Subsidiary so long as (i) neither the Parent nor any Restricted Subsidiary
is directly or indirectly liable for any Indebtedness of such Subsidiary, (ii) no
default with respect to any Indebtedness of such Subsidiary would permit (upon
notice, lapse of time or otherwise) any holder of any other Indebtedness of the
Parent or any Restricted Subsidiary to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity, (iii) any Investment in such Subsidiary made as a
result of designating such Subsidiary an Unrestricted Subsidiary will not
violate the provisions of Section 8.2(b) and (iv) no Credit
Party or Restricted Subsidiary has any obligation to subscribe for additional
shares of Capital Stock or other equity interests in such Subsidiary, or to
maintain or preserve such Subsidiary’s financial condition or to cause such
Subsidiary to achieve certain levels of operating results.

 

34

 

(ii)                                  The
Board of Directors of the Parent may designate any Unrestricted Subsidiary
as a Restricted Subsidiary; provided that such designation will be
deemed to be an incurrence of Indebtedness by such Restricted Subsidiary of any
outstanding Indebtedness of such Unrestricted Subsidiary and such designation
will only be permitted if (x) such Indebtedness is permitted under Section 8.2(a) and
(y) no Default or Event of Default will have occurred and be continuing
following such designation.

 

(j)                                     Consolidation,
Merger and Sale of Assets. Neither the Parent nor
any of the Companies will consolidate with or merge with or into any other Person
or, directly or indirectly, convey, transfer or lease its properties and assets
substantially as an entirety to any Person or Persons (in one transaction or a series of
related transactions), unless each of the following conditions is satisfied:

 

(i)                                     either
(A) the Parent or such Company, as such case may be, is the surviving
corporation or (B) the Person (if other than the Parent or such Company,
as the case may be) formed by such consolidation or into which the Parent
or such Company is merged or the Person that acquires by sale, assignment,
transfer, lease or other disposition of the properties and assets of the Parent
or such Company, as the case may be, substantially as an entirety (the “Surviving
Entity”) (1) is a corporation, partnership or trust organized and validly
existing under the laws of the United States, any state thereof or the District
of Columbia and (2) expressly assumes by supplemental agreement all of
such Credit Party’s obligations under this Agreement and the other Note
Documents;

 

(ii)                                  immediately
after giving effect to such transaction and treating any obligation of the
Parent or such Company in connection with or as a result of such transaction as
having been incurred at the time of such transaction, no Default or Event of
Default has occurred and is continuing;

 

(iii)                               immediately
after giving effect to such transaction on a pro  forma basis,
such Credit Party (or the Surviving Entity if such Credit Party is not a
continuing obligor under this Agreement) has a Consolidated Net Worth equal to
or greater than the Consolidated Net Worth of such Credit Party, immediately
prior to the closing of such transaction;

 

(iv)                              if
any of the property or assets of such Credit Party or such Surviving Entity if
such Credit Party is not a continuing obligor under this Agreement would
thereupon become subject to any Lien, the provisions of Section 8.2(f) are
complied with; and

 

(v)                                 the
Parent delivers, or causes to be delivered, to the Agent, in form and
substance reasonably satisfactory to the Agent, an officers’ certificate and an
opinion of counsel, each stating that such transaction complies with the
requirements of this Agreement.

 

In
the event of any transaction described in and complying with the conditions of
this Section 8.2(j) in which a Credit Party is not a continuing obligor
under this Agreement, the Surviving Entity will succeed to, and be substituted
for, and may exercise every right and power of, such Credit Party under
this Agreement and the other Note Documents and thereafter such

 

35

 

Credit
Party will, except in the case of a lease, be discharged from all its
obligations and covenants under this Agreement and the other Note Documents.

 

(k)                                  Limitation
on Business Activities. None of the Parent and
the Companies will, and the Companies will not permit any of their Restricted
Subsidiaries to, engage in any business other than a Permitted Business.

 

(l)                                     Minimum
Net Worth. Vanguard will not
permit the Consolidated Net Worth of Vanguard and its Subsidiaries at any time
to be less than $180,000,000.

 

9.                                       EVENTS
OF DEFAULT.

 

9.1.                              Events
of Default. An “Event of Default”
shall exist if any of the following conditions or events shall occur and be
continuing (each, an “Event of Default”):

 

(a)                                  the
Companies default in the payment of any principal of or premium, if any, on,
any Note when the same becomes due and payable, whether by scheduled maturity
or at a date fixed for prepayment or repurchase or by declaration, demand or
otherwise; or

 

(b)                                 the
Companies default in the payment of any interest on any Note or any other
amount (other than principal of or any premium on the Notes) when the same
becomes due and payable, and such default continues for a period of at least 10
consecutive days; or

 

(c)                                  any
Credit Party defaults in the performance of or compliance with any term,
covenant or agreement contained in Section 7.2, 7.3, 7.4 or 8.2, or

 

(d)                                 any
Credit Party defaults in the performance of or compliance with any term,
covenant or agreement contained in Section 8.1(a), 8.1(c), 8.1(e), 8.1(g),
8.1(j), 8.1(l) or 8.1(m), and such default shall remain unremedied for at least
10 consecutive days after the earlier of the first date on which (i) a
Responsible Officer becomes aware of such default and (ii) the Companies
receive notice of such default from the holders of at least 25% of the
aggregate outstanding principal of the Notes; or

 

(e)                                  any
Credit Party defaults in the performance of or compliance with any term,
covenant or agreement contained in any Note Document on its part to be
performed or complied with that is not referred to in Section 9.1(a),
9.1(b), 9.1(c) or 9.1(d), and such default shall remain unremedied for at
least 30 consecutive days after the Companies receive notice of such default
from the holders of at least 25% of the aggregate outstanding principal of the
Notes; or

 

(f)                                    any
representation or warranty made or deemed made on the Purchase Date by or on
behalf of any Credit Party under or pursuant to the terms of this Agreement or
any of the other Note Documents or in any writing furnished to the Agent or any
Purchaser pursuant to the terms of this Agreement or any of the other Note
Documents proves to have been false or incorrect in any material respect on the
date as of which it was made or deemed to have been made; or

 

36

 

(g)                                 (i) any
Credit Party or any Restricted Subsidiary shall fail to pay (A) any
principal of, or premium or interest on, Indebtedness that is outstanding in a
principal amount of at least $10,000,000 (but excluding Indebtedness
outstanding under the Note Documents), of such Person, when the same becomes
due and payable (whether by scheduled maturity, required prepayment, redemption
or repurchase, acceleration, demand or otherwise), and such failure shall
continue after the applicable grace period, if any, specified in any agreement
or instrument relating to such Indebtedness, or (B) any other amount of
Indebtedness greater than $10,000,000 (but excluding Indebtedness outstanding
under the Note Documents), of such Person when the same becomes due and payable
(whether by scheduled maturity, required prepayment, redemption or repurchase,
acceleration, demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in any agreement or instrument
relating to such Indebtedness; or (ii) any other event shall occur or
condition shall exist under any agreement or instrument, evidencing, securing
or otherwise relating to any Indebtedness referred to in clause (i) of
this Section 9.1(g) and shall continue after the applicable grace
period, if any, specified in such agreement or instrument, if the effect of
such event or condition is to accelerate the maturity of such Indebtedness or
otherwise to cause such Indebtedness to mature; or (iii) any Indebtedness
referred to in clause (i) of this Section 9.1(g) shall be
declared to be due and payable or required to be prepaid, redeemed or
repurchased (other than by a regularly scheduled required prepayment or
redemption), purchased or defeased, or an offer to prepay, redeem, repurchase,
purchase or defease any such Indebtedness shall be required to be made, in each
case prior to the stated maturity thereof or any date fixed for prepayment,
redemption or repurchase thereunder; or

 

(h)                                 any
Credit Party or any Restricted Subsidiary that is a Significant Subsidiary
shall generally not pay its debts as such debts become due, or shall admit in
writing its inability to pay its debts generally, or shall make a general assignment
for the benefit of creditors; or any proceeding shall be instituted by or
against any Credit Party or any Restricted Subsidiary that is a Significant
Subsidiary, seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee or other similar
official for it or for any substantial part of its property and assets
and, in the case of any such proceeding instituted against it (but not
instituted by it) that is being diligently contested by it in good faith,
either such proceeding shall remain undismissed or unstayed for a period of 60
consecutive days or any of the actions sought in such proceeding (including,
without limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official for, it
or any substantial part of its property and assets) shall occur; or any
Credit Party or any Restricted Subsidiary that is a Significant Subsidiary,
shall take any action to authorize any of the actions set forth above in this
subsection (h); or

 

(i)                                     one
or more judgments, orders or decrees for the payment of money aggregating
$10,000,000 (net of applicable insurance coverage, including self insurance,
provided pursuant to the Parent’s self insurance programs as presented to and
approved by the Parent’s Board of Directors) or more are rendered against one
or more of the Credit Parties and the Restricted Subsidiaries or any of their
respective properties and remain unsatisfied and either (i) such judgment,
order or decree has not been discharged or (ii) there shall be a period of
at

 

37

 

least
60 consecutive days after entry thereof during which a stay of enforcement of
any such judgment or order, by reason of a pending appeal or otherwise, shall
not be in effect; or

 

(j)                                     any
provision of any of the Note Documents after delivery thereof shall for any
reason (other than pursuant to the express terms thereof) cease to be valid and
binding on or enforceable against any Credit Party or Subsidiary Guarantor
intended to be a party to it or shall cease to give the Agent or any of the
Purchasers any of the rights, powers or privileges purported to be created
thereunder, or any Credit Party shall so state in writing; or

 

(k)                                  except
with respect to Collateral that has been transferred or sold or the Lien
thereon released as permitted under any Note Document, the Pledge Agreement
shall cease to be effective in all material respects to grant in favor of the
Agent the Liens with the priority purported to be created thereby on a material
portion of the Collateral thereunder, subject only to such Liens as are
expressly permitted by the Pledge Agreement, in each case for 30 days
after the Companies receive written notice thereof specifying such occurrence
from the Agent or the holders of at least 25% of the outstanding principal
amount at maturity of the Notes; or any Credit Party or Restricted Subsidiary
shall assert in writing that any Lien created under the Pledge Agreement is
invalid or unenforceable.

 

9.2.                              Acceleration.

 

(a)                                  If
an Event of Default described in Section 9.1(h) shall occur with
respect to any Company, all of the Notes then outstanding shall become
automatically and immediately due and payable.

 

(b)                                 If
any other Event of Default shall occur and be continuing, the Agent may, with
the consent of the Required Holders, and shall, upon the request of the
Required Holders, by notice or notices to the Companies, declare all of the
Notes then outstanding to be immediately due and payable.

 

(c)                                  Upon
any Note becoming due and payable under this Section 9.2, whether
automatically or by declaration, such Note will forthwith mature and the entire
unpaid principal amount of such Note, plus all accrued and unpaid
interest thereon and all other amounts due and payable to the holder thereof
under the Note Documents, shall be immediately due and payable, in each and
every case without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by the Companies.

 

9.3.                              Other
Remedies. If one or more
Defaults or Events of Default shall occur and be continuing, and irrespective
of whether any of the Notes have become or have been declared immediately due
and payable under Section 9.2, the Agent and the Required Holders may proceed
to protect and enforce any and all of their rights under the Note Documents and
may enforce their rights as holders of Notes by an action at law, suit in
equity or other appropriate proceeding, whether for the specific performance of
any agreement contained herein or in any of the other Note Documents, or for an
injunction against a violation of any of the terms hereof or thereof, or in aid
of the exercise of any power granted hereby or thereby or by applicable law or
otherwise.

 

38

 

9.4.                              Rescission.
At any time after any Notes have been declared due and payable pursuant to Section 9.2(b) the
Required Holders, by notice to the Companies, may rescind and annul any
such declaration and its consequences if (a) the Companies have paid all
overdue interest on the Notes, all principal of, and premium, if any, on the
Notes that are due and payable and are unpaid other than by reason of such
declaration, and all interest on such overdue principal and (to the fullest
extent permitted by applicable law) any overdue interest in respect of the
Notes, at the Default Rate, (b) all Defaults and Events of Default, other
than nonpayment of amounts that have become due solely by reason of such
declaration, have been remedied or have been waived pursuant to Section 14
and (c) no judgment or decree has been entered for the payment of any
monies due pursuant to the Notes or any of the other Note Documents. No
rescission and annulment under this Section 9.4 will extend to or affect
any subsequent Default or Event of Default or impair any right, power or remedy
consequent thereon.

 

9.5.                              Restoration
of Rights and Remedies. If any holder of the
Notes has instituted any proceeding to enforce any right or remedy under this
Agreement or any of the other Note Documents and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
such holder, then, and in each such case, the Companies and the holders of
Notes shall, subject to any determination in such proceeding, be restored
severally to their respective former positions hereunder and under the other
Note Documents and, thereafter, all rights and remedies of the holders of the
Notes shall continue as though no such proceeding had been instituted.

 

9.6.                              No
Waivers or Election of Remedies, Etc. No
course of dealing and no delay on the part of any holder of the Notes in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder’s rights, powers or remedies. No right, power
or remedy conferred by this Agreement or any of the other Note Documents upon
any holder of the Notes shall be exclusive of any other right, power or remedy
referred to herein or therein or now or hereafter available at law, in equity,
by statute or otherwise.

 

10.                                 REGISTRATION;
EXCHANGE; SUBSTITUTION OF NOTES.

 

10.1.                        Registration
of Notes. The Companies shall
keep at their principal executive office a register for the registration and
registration of transfers of Notes. The name and address of each holder of one
or more Notes, each transfer thereof and the name and address of each
transferee of one or more Notes shall be registered in such register. Prior to
due presentment for registration of transfer, the Person in whose name any Note
shall be registered shall be deemed and treated as the owner and holder thereof
for all purposes of this Agreement and the other Notes Documents, and the
Companies shall not be affected by any notice or knowledge to the contrary. The
Companies shall give to any holder of the Notes that is an Institutional
Investor, promptly upon request therefor, a complete and correct copy of the
names and addresses of all registered holders of Notes.

 

10.2.                        Transfer
and Exchange of Notes.

 

(a)                                  Upon
surrender of any Note at the principal executive office of the Companies for
registration of transfer or exchange (and, in the case of a surrender for
registration of transfer, duly endorsed or accompanied by a written instrument
of transfer duly executed by

 

39

 

the
registered holder of such Note or its attorney duly authorized in writing and
accompanied by the address for notices of each transferee of such Note or part thereof),
the Companies shall execute and deliver, at the Companies’ expense (except as
provided below), one or more new Notes (as requested by the holder thereof) in
exchange therefor, in an aggregate principal amount equal to the unpaid
principal amount of the surrendered Note. Each such new Note shall be payable
to such Person as such holder may request and, subject to subsection (c) of
this Section 10.2, shall be in substantially the form of Exhibit A
attached hereto. Each such new Note shall be dated and bear interest from the
date to which interest shall have been paid on the surrendered Note or dated
the date of the surrendered Note if no interest shall have been paid thereon.
The Companies may require payment of a sum sufficient to cover any stamp
tax or other governmental charge imposed in respect of any such transfer of
Notes. Notes shall not be transferred in denominations of less than $1,000, provided
that, if necessary to enable the registration of transfer by a holder of its
entire holding of Notes, one Note may be in a denomination of less than
$1,000.

 

(b)                                 Any
transferee, by its acceptance of a Note registered in its name (or the name of
its nominee), shall be deemed (i) to have made the representations set
forth in Sections 6.1 and 6.2 and (ii) to confirm to and agree with the
transferor and the other parties hereto as follows:

 

(A)                              other
than as provided in any written instrument of transfer executed by the
transferor and such transferee, such transferor makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
any of the other Note Documents, or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, this Agreement or any of the other Note Documents
or any other instrument or document furnished pursuant hereto or thereto;

 

(B)                                such
transferor makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Companies or any of their
Subsidiaries or the performance or observance by the Companies or any of their
Subsidiaries of any of its Obligations under this Agreement or any of the other
Note Documents or any other instrument or document furnished pursuant thereto;

 

(C)                                such
transferee confirms that it has received a copy of this Agreement and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to purchase the Note or Notes being purchased
thereby;

 

(D)                               such
transferee will, independently and without reliance upon the transferor or any
other holder of the Notes and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; and

 

40

 

(E)                                 such
transferee agrees that it will perform in accordance with their terms all
of the obligations which by the terms of this Agreement are required to be
performed by it as a holder of the Notes.

 

10.3.                        Replacement
of Notes. Upon receipt by the
Companies of evidence reasonably satisfactory to it of the ownership and the loss,
theft, destruction or mutilation of any Note (which evidence shall be, in the
case of an Institutional Investor, notice from such Institutional Investor of
such ownership and such loss, theft, destruction or mutilation), and

 

(a)                                  in
the case of loss, theft or destruction, of indemnity reasonably satisfactory to
it; provided that, if the holder of such Note is an original purchaser
of any of the Notes or any other Institutional Investor, such Person’s own
unsecured agreement of indemnity shall be deemed to be satisfactory, or

 

(b)                                 in
the case of mutilation, upon surrender and cancellation thereof, the Companies,
at their own expense, shall execute and deliver, in lieu thereof, a new Note,
dated and bearing interest from the date to which interest shall have been paid
on such lost, stolen, destroyed or mutilated Note or dated the date of such
lost, stolen, destroyed or mutilated Note if no interest shall have been paid
thereon.

 

11.                                 PAYMENTS
ON NOTES.

 

11.1.                        Place
of Payment. Subject to Section 11.2,
payments of principal, premium, if any, and interest becoming due and payable
on the Notes shall be made at an office in New York, New York designated by the
Companies. The Companies may, at any time, by notice to each holder of the
Notes, change the place of payment of the Notes so long as such place of
payment shall be either the principal office of the Company in such
jurisdiction or the principal office of a bank or trust company in such
jurisdiction.

 

11.2.                        Home
Office Payment. So long as any
Purchaser or its nominee shall be the holder of any Note, and notwithstanding
anything contained in Section 11.1 or in such Note to the contrary, the
Companies will pay all sums becoming due on such Note for principal, premium,
if any, and interest by the method and at the address specified for such
purpose below such Purchaser’s name on Schedule I attached hereto, or by
such other method or at such other address located in the United States of
America as such Purchaser shall have from time to time specified to the Companies
for such purpose, without the presentation or surrender of such Note or the
making of any notation thereon, except that upon the request of the Companies
made concurrently with or reasonably promptly after payment or prepayment in
full of any Note, the Holder of such Note shall surrender such Note for
cancellation, reasonably promptly after any such request, to the Companies at
their principal executive office or at the place of payment most recently
designated by the Companies pursuant to Section 11.1. Prior to any
permitted sale, transfer or other disposition of any Note held by any Purchaser
or its nominee, such Purchaser will, at its election, either endorse thereon
the amount of principal paid thereon and the last date to which interest has
been paid thereon or surrender such Note to the Companies in exchange for a new
Note or Notes pursuant to Section 10.2. The Companies will afford the
benefits of this Section 11.2 to any Institutional Investor that is the
direct or indirect transferee of any Note

 

41

 

purchased
by a Purchaser under this Agreement and that has made the same agreement
relating to such Note as such Purchaser have made in this Section 11.2 and
in Section 17.

 

12.                                 EXPENSES,
INCREASED COSTS AND INDEMNIFICATION, ETC.

 

12.1.                        Transaction
Expenses. Whether or not any of
the transactions contemplated hereby are consummated, the Companies will pay,
within 15 days of each demand therefor (such demand to be accompanied by
supporting documentation in reasonable detail), (a) all of the costs and
expenses incurred by each Purchaser and each other holder of a Note (including,
without limitation, reasonable attorneys’ fees of a special counsel and, if
reasonably required, local or other appropriate counsel for all Purchasers) in
connection with the preparation, execution and delivery of this Agreement and
the other Note Documents and all amendments, waivers or consents under or in
respect of this Agreement or any of the other Note Documents (whether or not
such amendment, waiver or consent becomes effective), and (b) all of the
costs and expenses incurred by each Purchaser and each other holder of a Note
(including, without limitation, reasonable attorneys’ fees of a special counsel
and if reasonably required, local or other appropriate counsel for you and the
Other Purchasers) in connection with the administration and enforcement of this
Agreement and the other Note Documents, including, without limitation:  (i) the reasonable costs and expenses
incurred in enforcing or defending (or determining whether or how to enforce or
defend) any rights under this Agreement or any of the other Note Documents or
in responding to any subpoena or other legal process or informal investigative
demand issued in connection with this Agreement or any of the other Note
Documents, or by reason of being a holder of the Notes, and (ii) the
reasonable costs and expenses (including, without limitation, financial
advisors’ fees) incurred in connection with the insolvency or bankruptcy of any
Credit Party or Restructured Subsidiary or in connection with any work-out,
renegotiation or restructuring of any of the transactions contemplated hereby
or by the other Note Documents. The Companies will pay, and will save each
Purchaser and each other holder of the Notes harmless from, all claims in
respect of any fees, costs or expenses, if any, of brokers and finders (other
than those retained by any such Purchaser or any such holder).

 

12.2.                        Indemnity.

 

(a)                                  In
addition to the payment of costs and expenses pursuant to Section 12.1,
the Companies agree, jointly and severally to indemnify, pay and hold each
Purchaser and each Purchaser’s affiliates and such Purchaser and its Affiliates
respective officers, directors, employees, attorneys, agents and other advisors
(each, an “Indemnified Party”), harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits
and claims, and all reasonable costs, expenses and disbursements, of any kind
or nature whatsoever (including, without limitation, reasonable fees and
disbursements of counsel for such Indemnified Parties) that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of, or in connection with the
preparation for a defense of, any investigation, litigation or proceeding
arising out of, related to, or in connection with (i) this Agreement and
the other Note Documents or any of the transactions contemplated hereby or thereby,
(ii) any use or intended use of the proceeds of any of the Notes, or (iii) the
actual or alleged presence of Hazardous Materials on any property of the
Companies or any of their Subsidiaries or any Environmental Action relating in
any way to the Companies or any of their Subsidiaries, in each case whether or
not such

 

42

 

investigation,
litigation or proceeding is brought by any Company, any of their Subsidiaries,
its directors, shareholders or creditors or an Indemnified Party or any
Indemnified Party is otherwise a party thereto and whether or not any sale and
purchase of the Notes pursuant to this Agreement is effected (collectively, the
“Indemnified Liabilities”); provided that the Companies shall not have
any obligation to any Indemnified Party hereunder with respect to any
Indemnified Liabilities arising from the gross negligence willful misconduct or
bad faith of such Indemnified Party as determined in a final, nonappealable
judgment by a court of competent jurisdiction.

 

(b)                                 The
Companies will not, without the prior written consent of the applicable
Indemnified Party, settle, compromise, consent to the entry of any judgment in
or otherwise seek to terminate any action, claim, suit or proceeding in respect
of which indemnification of such Indemnified Party may be sought under subsection (a) of
this Section 12.2 (whether or not such Indemnified Party is a party
thereto) unless such settlement, compromise, consent or termination includes a
full and unconditional release of such Indemnified Party from any and all
claims against such Indemnified Party and any and all liabilities thereof
arising out of or relating to such action, claim, suit or proceeding.

 

(c)                                  The
Companies also agree not to assert any claim against any Purchaser or any of
such Purchaser’s affiliates, or any of such Purchaser or its affiliates’
officers, directors, employees, attorneys, agents and other advisors, on any
theory of liability, for special, indirect, consequential or punitive damages
arising out of or otherwise relating to (i) this Agreement or any of the
other Note Documents, or any of the transactions contemplated hereby or thereby
or (ii) any use or intended use of the proceeds of any of the Notes.

 

(d)                                 If
and to the extent that the undertaking to indemnify, pay and hold harmless the
Indemnified Parties set forth in this Section 12.2 is judicially
determined to be unavailable to an Indemnified Party in respect of, or is
insufficient with respect to, any liabilities, obligations, losses, damages,
penalties, actions, judgments, suits or claims referred to herein, then, in
lieu of indemnifying such Indemnified Party hereunder, the Companies shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits or claims (and reasonable costs, expenses and disbursements
relating thereto) (i) in such proportion as is appropriate to reflect the
relative benefits to the Companies and their Subsidiaries, on the one hand, and
such Indemnified Party, on the other hand, from this Agreement and the sale and
purchase of the Notes or (ii) if the allocation provided by clause (i) of
this subsection (d) is not available, in such proportion as is
appropriate to reflect not only the relative benefits referred to in such
clause (i) but also the relative fault of each of the Companies and their
Subsidiaries, on the one hand, and such Indemnified Party, on the other hand,
in connection with such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits or claims, as well as any other relevant equitable
considerations.

 

12.3.                        Taxes.

 

(a)                                  Any
and all payments by or on behalf of the Companies hereunder or under the Note
Documents shall be made in accordance with the terms hereof and the other
applicable Note Documents, free and clear of and without deduction for any and
all present or future taxes, levies, imposts, deductions, withholdings or other
governmental charges, and all

 

43

 

liabilities
with respect thereto, excluding net income taxes and branch profits taxes that
are imposed by the United States of America and net income taxes and franchise
taxes (whether based on income or capital) that are imposed on such holder of
the Notes by the state or foreign jurisdiction under the laws of which such
holder of the Notes is organized, engages in a trade or business through an
office or other fixed place of business maintained by such holder in such state
or foreign jurisdiction, or has its principal office, or any political
subdivision thereof (all such nonexcluded taxes, levies, imposts, deductions,
withholdings, other governmental charges and liabilities in respect of payments
hereunder or under the Note Documents being hereinafter referred to as “Taxes”).
If the Companies shall be required by law to deduct any Taxes from or in
respect of any sum payable hereunder or under any of the Note Documents to any
holder of the Notes, (i) the sum payable shall be increased as may be
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 12.3) such holder
of the Notes receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Companies shall make such deductions
and (iii) the Companies shall pay the full amount deducted to the relevant
taxation authority or other Governmental Authority in accordance with
applicable law.

 

(b)                                 In
addition, the Companies shall pay any present or future transfer, stamp,
documentary, excise, property or other similar taxes, assessments, charges or
levies that arise from any payment made hereunder or under the other Note
Documents or from the execution, delivery, filing or registration of,
performance under, or otherwise with respect to, this Agreement or any of the
other Note Documents (other than any stamp tax or other governmental charge
that arises solely from any transfer of Notes in respect of which the Companies
are entitled to receive payment under Section 10.2) (hereinafter referred
to as “Other Taxes”).

 

(c)                                  The
Companies agree to indemnify, pay and hold each holder of the Notes harmless
from and against the full amount of Taxes and Other Taxes, and for the full
amount of taxes of any kind imposed by any jurisdiction on amounts payable
under this Section 12.3, imposed on or paid by such holder of the Notes as
a result of receiving any payment by or on behalf of the Companies hereunder or
under the other Note Documents and any liability (including penalties,
additions to tax, interest and expenses) arising therefrom or with respect
thereto. This indemnification shall be made within 30 days from the date
such holder of the Notes makes written demand therefor accompanied by evidence
as is reasonably available to such holder demonstrating that holder is liable
for or must otherwise pay such Taxes or Other Taxes.

 

(d)                                 Within
30 days after the date of any payment of Taxes, the Companies shall furnish to
each holder of the Notes, at its address referred to in Section 15, the
original receipt of payment thereof or a certified copy of such receipt. In the
case of any payment hereunder or under any of the other Note Documents by or on
behalf of the Companies through an account or branch outside the United States
or by or on behalf of the Companies by a payor that is not a United States
person, if the Companies determine that no Taxes are payable in respect
thereof, the Companies shall furnish, or shall cause such payor to furnish, to
each holder of the Notes, at such address, an opinion of counsel acceptable to
each holder of the Notes stating that such payment is exempt from Taxes. For
purposes of this subsection (d) and subsection (e) of this Section 12.3,
the terms “United States” and “United States person” shall have the meanings
specified in Section 7701 of the Internal Revenue Code.

 

44

 

(e)                                  Each
holder of the Notes that is not (i) a citizen or resident of the United
States, (ii) a corporation, partnership or other entity created or
organized in or under the laws of the United States (or any jurisdiction
thereof), (iii) an estate that is subject to federal income taxation
regardless of the source of its income or (iv) a trust the administration
of which is within the primary supervision of a Court in the United States and
as to which one or more United States persons have the authority to control all
substantial decisions (a “Non-U.S. Holder”) shall, on or prior to the date of
its execution and delivery of this Agreement, in the case of an original
purchaser of the Notes, and on the date in which it becomes a holder of the
Notes, in the case of each subsequent holder of the Notes, and from time to
time thereafter as requested in writing by the Companies, deliver to the Agent
and the Companies two copies of either U.S. Internal Revenue Service Form W-8BEN
or Form W-8ECI (or successor forms thereto), or, in the case of a Non-U.S.
Lender claiming exemption from U.S. federal withholding tax under Section 871(h) or
881(c) of the Internal Revenue Code of 1986, as amended, with respect to
payments of “portfolio interest” a statement substantially in the form of Exhibit E
and a Form W-8BEN, or any subsequent versions thereof or successors
thereto properly completed and duly executed by such Non-U.S. Holder claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Companies under this Agreement. Each Non-U.S. Holder shall
promptly notify the Companies at any time it determines that it is no longer in
a position to provide any previously delivered certificate to the Companies (or
any other form of certification adopted by the U.S. taxing authorities for
such purpose). Notwithstanding any other provision of this paragraph (e), a
Non-U.S. Holder shall not be required to deliver any form pursuant to this
paragraph (e) that such Non-U.S. Holder is not legally able to deliver. If
the form provided by a holder of the Notes pursuant to this subsection (e) at
the time such holder of the Notes first becomes a party to this Agreement
indicates a United States interest withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from Taxes unless and
until such holder of the Notes provides the appropriate form certifying
that a lesser rate applies, whereupon withholding tax at such lesser rate only
shall be considered excluded from Taxes for periods governed by such form. If
any form or document referred to in this subsection (e) requires
the disclosure of information, other than information necessary to compute the
tax payable and information required on the date hereof by Internal Revenue
Service form W-8BEN or W-8ECI (or the related certificate attached hereto
as Exhibit E) that the holder of the Notes reasonably considers to be
confidential, the holder of the Notes shall give notice thereof to the
Companies and shall not be obligated to include in such form or document
such confidential information.

 

(f)                                    For
any period with respect to which a holder of the Notes has failed to provide
the Companies with the appropriate form or document described in subsection (e) of
this Section 12.3 (other than if such failure is due to a change in law
occurring after the date on which a form originally was required to be
provided or if such form is not required under the last sentence of such
subsection (e)), such holder of the Notes shall not be entitled to
additional amounts or indemnification under subsection (a) or (c) of
this Section 12.3 with respect to Taxes imposed by the United States by
reason of such failure; provided, however, that should a holder
of the Notes become subject to Taxes because of its failure to deliver a form required
hereunder, the Companies shall take such steps as such holder of the Notes
shall reasonably request to assist such holder of the Notes to recover such
Taxes.

 

45

 

(g)                                 Any
holder of the Notes claiming any additional amounts payable pursuant to this Section 12.3
shall use reasonable efforts (consistent with its internal policy and legal and
regulatory restrictions) to file any certificate or document reasonably
requested by the Companies or to change the jurisdiction of its applicable lending
office if the making of such a filing or such change would avoid the need for
or reduce the amount of any such additional amounts that may thereafter
accrue and would not, in the sole determination of such holder, be otherwise
disadvantageous to such holder.

 

12.4.                        Survival.
The Obligations of the Companies under this Section 12  shall survive the payment or transfer of any
Note, the enforcement, amendment or waiver of any provision of this Agreement
or any of the other Note Documents, and the termination of this Agreement and
any commitment to purchase Notes hereunder and, in respect of any Person who
was at any time a Purchaser or in whose name or for whose benefit such Person
held any Note, the date on which such Person no longer holds, or no longer holds
in the name of or for the benefit of any other Person, any Note.

 

13.                                 SURVIVAL
OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

 

All
representations and warranties contained herein and in the other Note
Documents, and in any certificate or other instrument delivered by or on behalf
of the Companies pursuant to this Agreement or any of the other Note Documents,
shall survive the execution and delivery of this Agreement and the Notes, the
purchase or transfer by you of any Notes or portion thereof or interest therein
and the payment of any Notes, and may be relied upon by any subsequent
holder of the Notes as of the date made or deemed made, regardless of any
investigation made at any time by or on behalf of you or any other holder of
the Notes. This Agreement and the other Note Documents embody the entire
agreement and understanding between you, the Company and its Subsidiaries and
supersede all prior agreements and understandings relating to the subject
matter hereof.

 

14.                                 AMENDMENT
AND WAIVER.

 

14.1.                        Requirements.
This Agreement and the Notes may be amended, and the observance of any
term hereof or of the Notes may be waived (either retroactively or
prospectively), with and only with the written consent of the Companies and the
Required Holders, except that (a) no amendment or waiver of any of the
provisions of Sections 1, 2, 3, 4, 5, 6 and 18 will be effective as to any
Purchaser unless consented to in writing by such Purchaser and (b) no such
amendment or waiver shall, without the written consent of the holder of each
Note at the time outstanding, do any of the following at any time:

 

(i)                                     subject
to the provisions of Section 9 relating to acceleration or rescission,
change the amount or the time of any prepayment, repurchase or payment of
principal of, or reduce the rate, or change the time fixed for any payment or
change the method of computation of interest on, the Notes;

 

(ii)                                  change
the percentage of the aggregate principal amount of the Notes the holders of
which are required to consent to any such amendment or waiver;

 

46

 

(iii)                               subordinate
the Notes (or any of them) to any other obligations of the Company now or
hereafter existing other than as provided in this Agreement or the
Intercreditor Agreements;

 

(iv)                              reduce
or limit the Companies’ liability with respect to any Obligations owing to any
Purchaser or any other holder of any Note under or in respect of any of the
Note Documents; or

 

(v)                                 amend
any of Sections 7, 9.2, 14.2 and 17; or

 

(vi)                              release
all or substantially all of the Collateral except as provided in Section 20.7.

 

Notwithstanding any of the foregoing provisions of
this Section 14.1, none of the defined terms set forth in Schedule II
hereto shall be amended, supplemented or otherwise modified in any manner that
would change the meaning, purpose or effect of this Section 14.1 or any Section referred
to herein unless such amendment or modification is agreed to in writing by the
holders of the Notes otherwise required to amend or waive such Section under
the terms of this Section 14.1.

 

14.2.                        Solicitation
of Holders of Notes.

 

(a)                                  Solicitation.
The Companies will provide each holder of the Notes (irrespective of the amount
of Notes then owned or otherwise held by it at the time) with sufficient
information, reasonably far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
of this Agreement or any of the other Note Documents. The Companies will
deliver executed or true and correct copies of each amendment, waiver or
consent effected pursuant to the provisions of this Section 14 to each
holder of outstanding Notes promptly following the date on which it is executed
and delivered by, or receives the consent or approval of, the requisite holders
of the Notes.

 

(b)                                 Payment.
The Companies will not directly or indirectly pay or cause to be paid any
remuneration, whether by way of supplemental or additional interest, fee or
otherwise, or grant any security, to any holder of Notes as consideration for
or as an inducement to the entering into by any holder of Notes of any waiver
or amendment of any of the terms and provisions of this Agreement or any of the
other Note Documents, unless such remuneration is concurrently paid, or
security is concurrently granted, on the same terms, ratably to each holder of
Notes then outstanding that consents to such waiver or amendment.

 

14.3.                        Binding
Effect, Etc. Any amendment or waiver
consented to as provided in this Section 14 applies equally to all holders
of Notes and is binding upon them, upon each future holder of any Note and upon
the Companies without regard to whether such Note has been marked to indicate
such amendment or waiver. No such amendment or waiver will extend to or affect
any obligation, covenant, agreement, Default or Event of Default not expressly
amended or waived or impair any right, power or remedy consequent thereon. No
course of dealing nor any delay on the part of any holder of any Note in
exercising any right, power or remedy hereunder or under any of the other Note
Documents shall operate as a waiver of any right,

 

47

 

power
or remedy of any holder of such Note; nor shall any single or partial exercise
of any such right, power or remedy preclude any other or further exercise
thereof or the exercise of any other right, power or remedy. The remedies
provided under this Agreement and the other Note Documents are cumulative and
not exclusive of any rights, powers or remedies provided by applicable law

 

14.4.                        Notes
Held by Companies, Etc. Solely for the purpose
of determining whether the holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement or any of the
other Note Documents, or have directed the taking of any action provided for
herein or in any of the other Note Documents to be taken upon the direction of
the holders of a specified percentage of the aggregate principal amount of
Notes then outstanding, Notes directly or indirectly owned by the Companies or
any of their Affiliates shall be deemed not to be outstanding.

 

15.                                 NOTICES.

 

(a)                                  All
notices and other communications provided for hereunder shall be in writing and
delivered by telecopier or (if expressly permitted under the applicable
provisions hereof) by telephone, if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), by registered or certified mail with return receipt
requested (postage prepaid) or by a recognized overnight delivery service (with
charges prepaid). Any such notice must be sent:

 

(i)                                     if
to any Purchaser or its nominee, to it at the address specified for such
communications in Schedule I hereto, or at such other address as such
Purchaser shall have specified to the Companies in writing;

 

(ii)                                  if
to any other holder of any Note, to such holder at such address as such other
holder shall have specified to the Companies in writing; or

 

(iii)                               if
to the Parent or any Company, to it at 200 South Andrews Avenue, Fort
Lauderdale, Florida 33301, Attention:  Mr. Howard
Schwartz or at such other address as such Person shall have specified to the
holder of each Note in writing.

 

All
notices and other communications provided for under this Section 15 will
be deemed given and effective only when actually received.

 

(b)                                 If
any notice required under this Agreement or any of the other Note Documents is
permitted to be made, and is made, by telephone, actions taken or omitted to be
taken in reliance thereon by the Agent or any Purchaser shall be binding upon
the Companies notwithstanding any inconsistency between the notice provided by
telephone and any subsequent writing in confirmation thereof provided to the
Agent or any Purchaser, provided that any such action taken or omitted
to be taken by the Agent or any Purchaser shall have been in good faith and in
accordance with the terms of this Agreement.

 

48

 

16.                                 REPRODUCTION
OF DOCUMENTS.

 

This
Agreement, each of the other Note Documents and all other agreements,
certificates and other documents relating thereto, including, without
limitation, (a) amendments, waivers and consents of or to this Agreement
or any other Note Document that may hereafter be executed, (b) documents
received by the Agent or any Purchaser on the Purchase Date (except the Notes
themselves) and (c) financial statements, certificates and other
information previously or hereafter furnished to the Agent or any Purchaser, may be
reproduced by the Agent or any Purchaser by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process. The
Companies agree and stipulate that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by the Agent or any
Purchaser in the regular course of business) and any enlargement, facsimile or
further reproduction of such reproduction shall likewise be admissible in evidence.
This Section 16 shall not prohibit the Companies or any other holder of
Notes from contesting any such reproduction to the same extent that it could
contest the original or from introducing evidence to demonstrate the inaccuracy
of any such reproduction.

 

17.                                 CONFIDENTIAL
INFORMATION.

 

Each
Purchaser hereby agrees to maintain, and to cause each of the Persons referred
to in clause (a) of this Section 17 to which it delivers or
discloses Confidential Information to maintain, the confidentiality of all Confidential
Information in accordance with procedures adopted by such Purchaser in good
faith to protect confidential information of third parties delivered to it; provided
that such Purchaser may deliver or disclose Confidential Information to (a) its
affiliates and its respective directors, officers, employees, agents, attorneys
and other advisors (to the extent such disclosure reasonably relates to the
administration of the investment represented by your Notes), (b) such
Purchaser’s counsel and financial and other professional advisors who agree to
hold confidential the Confidential Information substantially in accordance with
the terms of this Section 17, (c) any other holder of any Note, (d) any
Person to which such Purchaser sells or offers to sell any Note or any part thereof
or any participation therein (if such Person has agreed in writing prior to its
receipt of such Confidential Information to be bound by provisions similar to
the provisions of this Section 17), (e) any Person from which such
Purchaser offers to purchase any security of any Company (if such Person has
agreed in writing prior to its receipt of such Confidential Information to be
bound by provisions similar to the provisions of this Section 17), (f) to
the extent required or requested thereby, any federal or state regulatory
authority having jurisdiction over such Purchaser, (g) any regulatory
examiners or auditors or accountants or any similar organization, or any
nationally recognized rating agency that requires access to information about
its investment portfolio or (h) any other Person to which such delivery or
disclosure may be necessary (i) in order to effect compliance with
any Requirement of Law applicable to such Purchaser, (ii) in response to
any subpoena or other legal process or (iii) in connection with any
litigation to which such Purchaser or any other holder of any Note is a party.
Each holder of a Note, by its acceptance of a Note, will be deemed to have
agreed to be bound by and to be entitled to the benefits of this Section 17
as though it were a party to this Agreement. Upon the reasonable request of the
Companies in connection with the delivery to any holder of a Note of
information required to be delivered to such holder under this Agreement or
requested by such holder (other than a holder that is a party to this Agreement
or

 

49

 

its
nominee), such holder will enter into an agreement with the Companies embodying
the provisions of this Section 17. Nothing in this Section 17 shall
obligate any Purchaser or any other holder of the Notes to return any
Confidential Information furnished by or on behalf of the Companies or any of
their Subsidiaries to the Companies or any such Subsidiary.

 

18.                                 SUBSTITUTION
OF PURCHASER.

 

Each
Purchaser shall have the right to substitute any Person as the purchaser of the
Notes that such Purchaser has agreed to purchase hereunder, by notice to the
Companies, which notice shall be signed by both such Purchaser and such Person,
shall contain such Person’s agreement to be bound by this Agreement and shall
contain a confirmation by such Person of the accuracy with respect to it of the
representations set forth in Section 6. Upon receipt of such notice, each
reference herein to such Purchaser (other than in this Section 18) shall
be deemed to refer to such Person in lieu of such Purchaser. In the event that
such Person is so substituted as a purchaser hereunder and such Person
thereafter transfers to such Purchaser all of the Notes then held by such Person,
upon receipt by the Companies of notice of such transfer, each reference herein
to such Person (other than in this Section 18) shall no longer be deemed
to refer to such Person, but shall refer to such Purchaser, and such Purchaser
shall have all of the rights of an original holder of the Notes under this
Agreement.

 

19.                                 GUARANTY
OF PARENT.

 

19.1.                        Guaranty.
The Parent hereby unconditionally and irrevocably guarantees the punctual
payment when due, whether at stated maturity, by acceleration or otherwise, of
all Obligations of the Companies now or hereafter existing under any Note
Document, whether for principal, interest (including all interest that accrues
after the commencement of any case, proceeding or other action relating to
bankruptcy, insolvency or reorganization of the Companies), fees, expenses or
otherwise, and agrees to pay any and all expenses (including reasonable counsel
fees and expenses) incurred by the Agent and the Purchasers in enforcing any
rights under the guaranty set forth in this Section 19. Without limiting
the generality of the foregoing, the Parent’s liability shall extend to all
amounts that constitute part of the Obligations and would be owed by the
Companies to the Agent and the Purchasers under any Note Document but for the fact
that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving any Company.

 

19.2.                        Guaranty
Absolute. The Parent guarantees
that the Obligations will be paid strictly in accordance with the terms of the
Note Documents, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the
Agent or any Purchaser with respect thereto. The obligations of the Parent
under this Section 19 are independent of the Obligations, and a separate
action or actions may be brought and prosecuted against the Parent to
enforce such obligations, irrespective of whether any action is brought against
the Company or whether any Company are joined in any such action or actions.
The liability of the Parent under this Section 19 shall be irrevocable,
absolute and unconditional irrespective of, and the Parent hereby irrevocably
waives any defenses it may now or hereafter have in any way relating to,
any or all of the following:

 

50

 

(a)                                  any
lack of validity or enforceability of any Note Document or any agreement or
instrument relating thereto;

 

(b)                                 any
change in the time, manner or place of payment of, or in any other term of, all
or any of the Obligations, or any other amendment or waiver of or any consent
to departure from any Note Document, including any increase in the Guaranteed
Obligations resulting from the purchase of additional Notes from the Companies
or otherwise;

 

(c)                                  any
taking, exchange, release or non-perfection of any Collateral, or any taking,
release or amendment or waiver of or consent to departure from any other
guaranty, for all or any of the Obligations;

 

(d)                                 any
change, restructuring or termination of the corporate, limited liability
company or partnership structure or existence of any Subsidiaries of the
Parent; or

 

(e)                                  any
other circumstance (including any statute of limitations) or any existence of
or reliance on any representation by the Agent or you that might otherwise
constitute a defense available to, or a discharge of, the Parent, any Company
or any other guarantor or surety.

 

This
Section 19 shall continue to be effective or be reinstated, as the case may be,
if at any time any payment of any of the Obligations is rescinded or must
otherwise be returned by you or any other Person upon the insolvency,
bankruptcy or reorganization of any Company or otherwise, all as though such
payment had not been made.

 

19.3.                        Waiver.
The Parent hereby waives promptness, diligence, notice of acceptance and any
other notice with respect to any of the Guaranteed Obligations and this Section and
any requirement that the Agent or you exhaust any right or take any action
against the Companies or any other Person or any Collateral. the Parent
acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated herein and that the waiver set forth in
this subsection 19.3 is knowingly made in contemplation of such benefits.
the Parent hereby waives any right to revoke this Section, and acknowledges
that this Section 19 is continuing in nature and applies to all
Obligations, whether existing now or in the future.

 

19.4.                        Continuing
Guaranty; Assignments. This Section 19
is a continuing guaranty and shall (a) remain in full force and effect
until the later of the cash payment in full of the Obligations (other than
indemnification obligations as to which no claim has been made) and all other
amounts payable under this Section 19 and the Stated Maturity, (b) be
binding upon the Parent, its successors and assigns and (c) inure to the
benefit of and be enforceable by the Agent and the Purchasers and the Agent and
the Purchasers’ successors, pledgees, transferees and assigns. Without limiting
the generality of the foregoing clause (c), each Purchaser may pledge,
assign or otherwise transfer all or any portion of its rights and obligations
under this Agreement (including all or any portion of the Notes held by it) to
any other Person, and such other Person shall thereupon become vested with all
the benefits in respect thereof granted to such Purchaser herein or otherwise.

 

19.5.                        Subrogation.
The Parent will not exercise any rights that it may now or hereafter
acquire against any Company, or any other insider guarantor that arise from the

 

51

 

existence,
payment, performance or enforcement of the Parent’s obligations under this Section 19,
including any right of subrogation, reimbursement, exoneration, contribution or
indemnification and any right to participate in any claim or remedy of the
Agent and the Purchasers you against the Companies, or any other insider
guarantor or any collateral, whether or not such claim, remedy or right arises
in equity or under contract, statute or common law, including the right to take
or receive from the Companies, or any other insider guarantor, directly or
indirectly, in cash or other property or by set-off or in any other manner,
payment or security solely on account of such claim, remedy or right, unless
and until all of the Obligations and all other amounts payable under this Section shall
have been paid in full in cash and the Stated Maturity shall have occurred. If
any amount shall be paid to the Parent in violation of the immediately
preceding sentence at any time prior to the later of the payment in full in
cash of the Obligations and all other amounts payable under this Section and
the Stated Maturity, such amount shall be held in trust for the benefit of the
Agent and the Purchasers and shall forthwith be paid to the Agent and the
Purchasers to be credited and applied to the Obligations and all other amounts
payable under this Section 19, whether matured or unmatured, in accordance
with the terms of this Agreement, or to be held as collateral for any
Obligations or other amounts payable under this Section 19 thereafter
arising. If (i) the Parent shall make payment to the Agent and you of all
or any part of the Obligations, (ii) all of the Guaranteed
Obligations and all other amounts payable under this Section shall be paid
in full in cash and (iii) the Stated Maturity shall have occurred, the
Agent and each Purchasers will, at the Parent’s request and expense, execute
and deliver to the Parent appropriate documents, without recourse and without
representation or warranty, necessary to evidence the transfer by subrogation
to the Parent of an interest in the Obligations resulting from such payment by
the Parent

 

20.                                 THE
AGENT.

 

20.1.                        Authorization
and Action.

 

(a)                                  Each
Purchaser hereby appoints Madeleine L.L.C. as the Agent hereunder and each
Purchaser authorizes the Agent to take such action as agent on its behalf and
to exercise such powers under this Agreement and the other Note Documents as are
delegated to the Agent under such agreements and to exercise such powers as are
reasonably incidental thereto. Without limiting the foregoing, each Purchaser
hereby authorizes the Agent to execute and deliver, and to perform its
obligations under, each of the Note Documents to which the Agent is a party, to
exercise all rights, powers and remedies that the Administrative Agent may have
under such Note Documents and, in the case of the Pledge Agreement, to act as
agent for the Purchasers and the other Secured Parties under such Note
Document.

 

(b)                                 As
to any matters not expressly provided for by this Agreement and the other Note
Documents (including enforcement or collection) the Agent shall not be required
to exercise any discretion or take any action, but shall be required to act or
to refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of the Required Holders, and such
instructions shall be binding upon all Purchasers and other holders of the Notes;
provided, however, that the Agent shall be required to take any action that (i) the
Agent in good faith believes exposes it to personal liability unless the Agent
receives an indemnification satisfactory to it from the Purchasers and other
holders of the Notes with respect to such action or (ii) is contrary to
this Agreement, any Note Document or any

 

52

 

applicable
requirement of law. The Agent agrees to give to each Purchaser and each other
holder of a Note prompt notice of each notice given to it by any Credit Party
pursuant to the terms of this Agreement or the other Note Documents.

 

(c)                                  In
performing its functions and duties hereunder and under the other Note
Documents, the Agent is acting solely on behalf of the Purchasers and other
holders of the Notes and its duties are entirely administrative in nature. The
Agent does not assume and shall not be deemed to have assumed any obligation
other than as expressly set forth herein and in the other Note Documents or any
other relationship as the agent, fiduciary or trustee of or for any Purchaser
and each other holder of a Note. The Agent may perform any of its
duties under any Loan Document by or through its agents or employees.

 

20.2.                        Agent’s
Reliance, Etc. None of the Agent, any
of its Affiliates or any of their respective directors, officers, agents or
employees shall be liable for any action taken or omitted to be taken by it,
him, her or them under or in connection with this Agreement or the other Note Documents,
except for its, his, her or their own gross negligence or willful misconduct.
Without limiting but subject to the foregoing, the Agent (a) may treat
the payee of any Note as its holder until such Note has been assigned in
accordance with Section 10.2, (b) may rely on the Register to
the extent set forth in Section 10.1, (c) may consult with legal
counsel (including counsel to any Credit Party), independent public accountants
and other experts selected by it and shall not be liable for any action taken
or omitted to be taken in good faith by it in accordance with the advice of
such counsel, accountants or experts, (d) makes no warranty or
representation to any Purchaser or other holder of a Note and shall not be
responsible to any Purchaser or other holder of a Note for any statements,
warranties or representations made by or on behalf of the Parent or any of its
Subsidiaries in or in connection with this Agreement or any other Note
Document, (e) shall not have any duty to ascertain or to inquire either as
to the performance or observance of any term, covenant or condition of this
Agreement or any other Note Document, as to the financial condition of any Note
Party or as to the existence or possible existence of any Default or Event of
Default, (f) shall not be responsible to any Purchaser or other holder of
a Note for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of, or the attachment, perfection or priority of any Lien
created or purported to be created under or in connection with, this Agreement,
any other Note Document or any other instrument or document furnished pursuant
hereto or thereto and (g) shall incur no liability under or in respect of
this Agreement or any other Note Document or by acting upon any notice,
consent, certificate or other instrument or writing (which writing may be
a telecopy or, if consented to by the Agent, electronic mail) or any telephone
message believed by it to be genuine and signed or sent by the proper party or
parties.

 

20.3.                        The
Agent Individually. With respect to its
Ratable Portion, to the extent that the Agent is a Purchaser or holder of a
Note it shall have and may exercise the same rights and powers hereunder
and is subject to the same obligations and liabilities as and to the extent set
forth herein for any other Purchaser or other holder of a Note.

 

20.4.                        Purchaser
Credit Decision. Each Purchaser
acknowledges that it shall, independently and without reliance upon the Agent
conduct its own independent investigation of the financial condition and
affairs of the Credit Parties in connection with the purchasing Notes. Each
Purchaser also acknowledges that it shall, independently and without reliance
upon the

 

53

 

Agent
or any other Purchaser or other holder or other holder of a Note and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement and the other Note Documents.

 

20.5.                        Indemnification.
Each Purchaser and other holder of a Note agrees to indemnify the Agent and
each of its Affiliates, and each of their respective directors, officers,
employees, agents and advisors (to the extent not reimbursed by the Credit
Parties), from and against such Purchaser or holder’s aggregate Ratable Portion
of any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses and disbursements (including fees, expenses
and disbursements of financial and legal advisors) of any kind or nature
whatsoever that may be imposed on, incurred by, or asserted against, the
Agent or any of its Affiliates, directors, officers, employees, agents and
advisors in any way relating to or arising out of this Agreement or the other
Note Documents or any action taken or omitted by the Agent under this
Agreement, or the other Note Documents; provided, however, that no Lender shall
be liable for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Agent’s or such Affiliate’s gross negligence or willful misconduct. Without
limiting the foregoing, each Purchaser and holder of a Note agrees to reimburse
the Agent promptly upon demand for its ratable share of any out-of-pocket
expenses (including fees, expenses and disbursements of financial and legal
advisors) incurred by the Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of its rights or responsibilities under, this Agreement or the other
Note Documents, to the extent that the Agent is not reimbursed for such
expenses by any Credit Party.

 

20.6.                        Successor
Administrative Agent. The Agent may resign
at any time by giving written notice thereof to the Purchasers and the Credit
Parties. Upon any such resignation, the Required Holders shall have the right
to appoint a successor Agent. If no successor Agent shall have been so
appointed by the Required Holders, and shall have accepted such appointment,
within 30 days after the retiring Agent’s giving of notice of resignation, then
the retiring Agent may, on behalf of the Purchasers, appoint a successor Agent,
selected from among the Purchasers. In either case, such appointment shall be
subject to the prior written approval of the Credit Parties (which approval may not
be unreasonably withheld and shall not be required upon the occurrence and
during the continuance of an Event of Default). Upon the acceptance of any
appointment as Agent by a successor Agent, such successor Agent shall succeed
to, and become vested with, all the rights, powers, privileges and duties of
the retiring Agent, and the retiring Agent shall be discharged from its duties
and obligations under this Agreement and the other Note Documents. Prior to any
retiring Agent’s resignation hereunder as Agent, the retiring Agent shall take
such action as may be reasonably necessary to assign to the successor
Agent its rights as Agent under the Note Documents. After such resignation, the
retiring Agent shall continue to have the benefit of this Section 20 as to
any actions taken or omitted to be taken by it while it was Agent under this
Agreement and the other Note Documents.

 

54

 

20.7.                        Concerning
the Collateral and the Pledge Agreement.

 

(a)                                  Each
Purchaser and each other holder of a Note agrees that any action taken by the
Agent or the Required Holders (or, where required by the express terms of this
Agreement, a greater proportion of the holders of Notes) in accordance with the
provisions of this Agreement or the other Note Documents, and the exercise by
the Agent or the Required Holders (or, where so required, such greater
proportion) of the powers set forth herein or therein, together with such other
powers as are reasonably incidental thereto, shall be authorized and binding
upon all Purchasers, such other holders and other Secured Parties. Without
limiting the generality of the foregoing, the Agent shall have the sole and
exclusive right and authority to (i) act as the disbursing and collecting
agent for the Purchasers, such other holders and with respect to all payments
and collections arising in connection herewith and with the Note Documents, (ii) execute
and deliver the Purchase Agreement and accept delivery of each such agreement
delivered by the Parent or any of its Subsidiaries, (iii) act as
collateral agent for the Purchasers, such other holders and the other Secured
Parties for purposes of the perfection of all security interests and Liens
created by such agreements and all other purposes stated therein, provided,
however, that the Agent hereby appoints, authorizes and directs each Purchaser
and other holder of a Note to act as collateral sub-agent for the Agent, the
Purchasers and the other holders of Notes for purposes of the perfection of all
security interests and Liens with respect to any Collateral held by such
Purchaser or other holder, (iv) manage, supervise and otherwise deal with
the Collateral, (v) take such action as is necessary or desirable to
maintain the perfection and priority of the security interests and Liens
created or purported to be created by the Pledge Agreement and (vi) except
as may be otherwise specifically restricted by the terms hereof, of any
other Note Document, exercise all remedies given to the Agent, the Purchasers
and the other holders of Notes and the other Secured Parties with respect to
the Collateral under the Note Documents relating thereto, applicable law or
otherwise.

 

(b)                                 Each
of the Purchasers and the other holders of Notes hereby directs, in accordance
with the terms hereof, the Agent to release any Lien held by the Agent for the
benefit of the Purchasers and the other holders of the Notes against any of the
following:

 

(i)                                     all
of the Collateral, upon payment and satisfaction in full of all Obligations
that the Agent has been notified in writing are then due and payable; and

 

(ii)                                  if
such sale or disposition is permitted by this Agreement (or permitted pursuant
to a waiver or consent of a transaction otherwise prohibited by this
Agreement), any Collateral sold or disposed of by a Credit Party or a
Restricted Subsidiary.

 

Each
of the Purchasers and the other holders of Notes hereby directs the Agent to
execute and deliver or file such termination and partial release statements and
do such other things as are necessary to release Liens to be released pursuant
to this Section 20.7 promptly upon the effectiveness of any such release.

 

21.                                 MISCELLANEOUS.

 

21.1.                        Successors
and Assigns. All covenants and
other agreements contained in this Agreement or any of the other Note Documents
by or on behalf of any of the parties hereto

 

55

 

bind
and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent holder of a Note), whether or not so
expressed.

 

21.2.                        Payments
Due on Non-Business Days. Anything in this
Agreement or the Notes to the contrary notwithstanding, any payment of
principal of, or premium, if any, or interest on, any Note that is due on a
date other than a Business Day shall be made on the next succeeding Business Day
without including the additional days elapsed in the computation of the items
payable on such next succeeding Business Day.

 

21.3.                        Satisfaction
Requirement. Except as otherwise
provided herein or in any of the other Note Documents, if any agreement, certificate
or other writing, or any action taken or to be taken, is by the terms of this
Agreement or any of the other Note Documents required to be satisfactory to the
Purchasers or to the Required Holders, the determination of such satisfaction
shall be made by you or the Required Holders, as the case may be, in the
sole and exclusive judgment (exercised reasonably and in good faith) of the
Person or Persons making such determination.

 

21.4.                        Severability.
Any provision of this Agreement that 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 (to the full extent permitted by applicable law) not
invalidate or render unenforceable such provision in any other jurisdiction.

 

21.5.                        Construction;
Accounting Terms, Etc.

 

(a)                                  Each
covenant contained herein shall be construed (absent express provision to the
contrary) as being independent of each other covenant contained herein, so that
compliance with any one covenant shall not (absent such an express contrary
provision) be deemed to excuse compliance with any other covenant. Where any
provision herein refers to action to be taken by any Person, or which such
Person is prohibited from taking, such provision shall be applicable whether
such action is taken directly or indirectly by such Person.

 

(b)                                 Except
as otherwise expressly provided in this Agreement or any of the other Note
Documents, all accounting terms used herein or therein shall be interpreted,
and all financial statements and certificates and reports as to financial
matters required to be delivered hereunder shall be prepared, in accordance
with GAAP.

 

21.6.                        Computation
of Time Periods. In this Agreement, in
the computation of periods of time from a specific date to a later specified
date, the word “from” means “from and including”, the word “through” means “through
and including”, and the words “to” and “until” each mean “to but not excluding”.

 

21.7.                        Execution
in Counterparts. This Agreement may be
executed in any number of counterparts and by different 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. Delivery of an executed counterpart of a signature page to
this Agreement by telecopier shall be effective as delivery of a manually
executed counterpart of this Agreement.

 

56

 

21.8.                        Governing
Law; Submission to Jurisdiction, Etc.

 

(a)                                  This
Agreement shall be governed by, and construed in accordance with, the law of
the State of New York.

 

(b)                                 Each
of the Parent and the Companies hereby irrevocably and unconditionally submits,
for itself, its Subsidiaries and its and their property and assets, to the
nonexclusive jurisdiction of any New York state court or federal court of the
United States of America sitting in New York City, New York, and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Agreement or the other Note Documents, or for recognition or
enforcement of any judgment in respect thereof, and each of the Parent and the
Companies hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in
any such New York state court or, to the fullest extent permitted by applicable
law, in such federal court. Each of the Parent and the Companies hereby
irrevocably consents to the service of copies of any summons and complaint and
any other process which may be served in any such action or proceeding by
certified mail, return receipt requested, or by delivering a copy of such
process to it, at its address specified in Section 15, or by any other
method permitted by law. Each of the Parent and the Companies hereby agrees
that 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 applicable law. Nothing in this Agreement shall affect any right
that any holder of Notes may otherwise have to bring any action or
proceeding relating to this Agreement or the other Note Documents in the courts
of any jurisdiction.

 

(c)                                  Each
of the Parent and the Companies hereby irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection
that it may now or hereafter have to the laying of venue of any action or
proceeding arising out of or relating to this Agreement or the other Note
Documents in any New York state or federal court. Each of the Parent and the
Companies hereby irrevocably waives, to the fullest extent permitted by
applicable law, the defense of an inconvenient forum to the maintenance of such
action or proceeding in any such court.

 

21.9.                        Waiver
of Jury Trial. EACH OF THE PARENT,
THE COMPANIES AND THE HOLDERS OF THE NOTES HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE
NOTES OR ANY OF THE OTHER NOTE DOCUMENTS, ANY DOCUMENT DELIVERED UNDER THE NOTE
DOCUMENTS, THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, OR THE ACTIONS OF
ANY HOLDER OF THE NOTES IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR
ENFORCEMENT THEREOF.

 

57

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  VANGUARD CAR RENTAL USA

  HOLDINGS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ HOWARD D. SCHWARTZ

  	
   

  
	
   

  	
   

  	
  Name: Howard D. Schwartz

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  VANGUARD CAR RENTAL USA INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ HOWARD D. SCHWARTZ

  	
   

  
	
   

  	
   

  	
  Name: Howard D. Schwartz

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ALAMO RENTAL (US) INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ HOWARD D. SCHWARTZ

  	
   

  
	
   

  	
   

  	
  Name: Howard D. Schwartz

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NATIONAL RENTAL (US) INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ HOWARD D. SCHWARTZ

  	
   

  
	
   

  	
   

  	
  Name: Howard D. Schwartz

  
	
   

  	
   

  	
  Title: Senior Vice President

  

 

58

 

If
you are in agreement with the foregoing, please sign in the appropriate space
provided below and return it to the Companies, whereupon the foregoing shall
become a binding agreement among you and the Companies.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MADELEINE L.L.C.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ LENARD TESSLER

  	
   

  
	
   

  	
   

  	
  Name: Lenard Tessler

  
	
   

  	
   

  	
  Title: Attorney-in-Fact

  

 

59Exhibit 4.29

 

EXECUTION COPY

 

 

 

NOTE PURCHASE AGREEMENT

 

 

Dated as of October 14, 2003

 

by and among

 

Vanguard Car Rental USA Inc.,

 

Alamo Rental (US) Inc.,

 

National Rental (US) Inc.

 

as Companies

 

Vanguard Car Rental USA Holdings Inc.,

 

as Guarantor,

 

the Purchasers herein

 

and

 

Madeleine L.L.C.

 

as Administrative Agent and Collateral Agent

 

 

15% Secured Junior Subordinated Notes due September
30, 2008

 

 

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
  1.

  	
  AUTHORIZATION
  OF NOTES

  	
  1

  
	
   

  	
   

  	
   

  
	
  2.

  	
  SALE
  AND PURCHASE OF NOTES.

  	
  1

  
	
   

  	
  2.1.

  	
  Obligation
  to Purchase

  	
  1

  
	
   

  	
  2.2.

  	
  Notice
  of Purchase

  	
  2

  
	
   

  	
  2.3.

  	
  Closing

  	
  2

  
	
   

  	
  2.4.

  	
  Interest

  	
  2

  
	
   

  	
  2.5.

  	
  Fees

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  PAYMENTS;
  NATURE OF COMPANIES’ OBLIGATIONS

  	
  3

  
	
   

  	
  3.1.

  	
  Payments
  and Computations

  	
  3

  
	
   

  	
  3.2.

  	
  Sharing
  of Payments, Etc

  	
  3

  
	
   

  	
  3.3.

  	
  Apportionment
  of Payments

  	
  4

  
	
   

  	
  3.4.

  	
  Joint
  and Several Liability of the Companies

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  CONDITIONS
  TO THE PURCHASE.

  	
  5

  
	
   

  	
  4.1.

  	
  Documents
  Required

  	
  5

  
	
   

  	
  4.2.

  	
  The
  Sale Order

  	
  8

  
	
   

  	
  4.3.

  	
  The
  Acquisition

  	
  8

  
	
   

  	
  4.4.

  	
  Capitalization

  	
  8

  
	
   

  	
  4.5.

  	
  Insurance
  and Surety Bonding Requirements

  	
  9

  
	
   

  	
  4.6.

  	
  Information
  Technology

  	
  9

  
	
   

  	
  4.7.

  	
  Payment
  of Accrued Fees and Expenses

  	
  9

  
	
   

  	
  4.8.

  	
  Representations
  and Warranties

  	
  9

  
	
   

  	
  4.9.

  	
  No
  Default

  	
  9

  
	
   

  	
  4.10.

  	
  Purchase
  Permitted by Applicable Requirements of Law, Etc

  	
  9

  
	
   

  	
  4.11.

  	
  Consents
  and Approvals

  	
  9

  
	
   

  	
  4.12.

  	
  No
  Litigation or Other Proceedings

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  REPRESENTATIONS
  AND WARRANTIES OF THE CREDIT PARTIES

  	
  10

  
	
   

  	
  5.1.

  	
  Organization,
  Good Standing, Etc

  	
  10

  
	
   

  	
  5.2.

  	
  Authorization,
  Etc

  	
  10

  
	
   

  	
  5.3.

  	
  Governmental
  Approvals

  	
  10

  
	
   

  	
  5.4.

  	
  Enforceability
  of Note Documents

  	
  10

  
	
   

  	
  5.5.

  	
  Subsidiaries

  	
  11

  
	
   

  	
  5.6.

  	
  Litigation

  	
  11

  
	
   

  	
  5.7.

  	
  Financial
  Condition

  	
  11

  
	
   

  	
  5.8.

  	
  Compliance
  with Law, Etc

  	
  11

  
	
   

  	
  5.9.

  	
  ERISA

  	
  11

  
	
   

  	
  5.10.

  	
  Health
  Benefits; WARN

  	
  12

  
	
   

  	
  5.11.

  	
  Taxes,
  Etc

  	
  12

  
	
   

  	
  5.12.

  	
  Use
  of Proceeds; Margin Regulations

  	
  12

  
	
   

  	
  5.13.

  	
  Nature
  of Business

  	
  13

  

 

i

 

	
   

  	
  5.14.

  	
  Permits,
  Etc

  	
  13

  
	
   

  	
  5.15.

  	
  Properties

  	
  13

  
	
   

  	
  5.16.

  	
  Full
  Disclosure

  	
  13

  
	
   

  	
  5.17.

  	
  Environmental
  Matters

  	
  13

  
	
   

  	
  5.18.

  	
  Solvency

  	
  14

  
	
   

  	
  5.19.

  	
  Intellectual
  Property

  	
  14

  
	
   

  	
  5.20.

  	
  Material
  Contracts

  	
  14

  
	
   

  	
  5.21.

  	
  Private
  Placement

  	
  14

  
	
   

  	
  5.22.

  	
  Investment
  Company Act

  	
  15

  
	
   

  	
  5.23.

  	
  Employee
  and Labor Matters

  	
  15

  
	
   

  	
  5.24.

  	
  Representations
  and Warranties in Documents; No Default

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  REPRESENTATIONS
  OF THE PURCHASERS.

  	
  15

  
	
   

  	
  6.1.

  	
  Purchase
  for Investment

  	
  15

  
	
   

  	
  6.2.

  	
  Accredited
  Investor

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
  PREPAYMENTS
  AND REPURCHASES OF THE NOTES.

  	
  16

  
	
   

  	
  7.1.

  	
  Optional
  Prepayments of the Notes

  	
  16

  
	
   

  	
  7.2.

  	
  Offer
  to Repurchase Notes Upon a Change of Control

  	
  16

  
	
   

  	
  7.3.

  	
  Offer
  to Repurchase Notes in Respect of an Asset Sale

  	
  17

  
	
   

  	
  7.4.

  	
  Allocation
  of Partial Prepayments

  	
  19

  
	
   

  	
  7.5.

  	
  Maturity;
  Surrender, Etc

  	
  19

  
	
   

  	
  7.6.

  	
  Purchase
  of Notes

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
  COVENANTS
  OF THE PARENT AND THE COMPANIES

  	
  19

  
	
   

  	
  8.1.

  	
  Affirmative
  Covenants

  	
  19

  
	
   

  	
  8.2.

  	
  Negative
  Covenants

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
  EVENTS
  OF DEFAULT

  	
  36

  
	
   

  	
  9.1.

  	
  Events
  of Default

  	
  36

  
	
   

  	
  9.2.

  	
  Acceleration

  	
  38

  
	
   

  	
  9.3.

  	
  Other
  Remedies

  	
  39

  
	
   

  	
  9.4.

  	
  Rescission

  	
  39

  
	
   

  	
  9.5.

  	
  Restoration
  of Rights and Remedies

  	
  39

  
	
   

  	
  9.6.

  	
  No
  Waivers or Election of Remedies, Etc

  	
  39

  
	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
  REGISTRATION;
  EXCHANGE; SUBSTITUTION OF NOTES

  	
  40

  
	
   

  	
  10.1.

  	
  Registration
  of Notes

  	
  40

  
	
   

  	
  10.2.

  	
  Transfer
  and Exchange of Notes

  	
  40

  
	
   

  	
  10.3.

  	
  Replacement
  of Notes

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
  PAYMENTS
  ON NOTES

  	
  41

  
	
   

  	
  11.1.

  	
  Place
  of Payment

  	
  41

  
	
   

  	
  11.2.

  	
  Home
  Office Payment

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
  EXPENSES,
  INCREASED COSTS AND INDEMNIFICATION, ETC

  	
  42

  
	
   

  	
  12.1.

  	
  Transaction
  Expenses

  	
  42

  

 

ii

 

	
   

  	
  12.2.

  	
  Indemnity

  	
  43

  
	
   

  	
  12.3.

  	
  Taxes

  	
  44

  
	
   

  	
  12.4.

  	
  Survival

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
  SURVIVAL
  OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT

  	
  46

  
	
   

  	
   

  	
   

  
	
  14.

  	
  AMENDMENT
  AND WAIVER

  	
  47

  
	
   

  	
  14.1.

  	
  Requirements

  	
  47

  
	
   

  	
  14.2.

  	
  Solicitation
  of Holders of Notes

  	
  47

  
	
   

  	
  14.3.

  	
  Binding
  Effect, Etc

  	
  48

  
	
   

  	
  14.4.

  	
  Notes
  Held by Companies, Etc

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
  15.

  	
  NOTICES

  	
  48

  
	
   

  	
   

  	
   

  
	
  16.

  	
  REPRODUCTION
  OF DOCUMENTS

  	
  49

  
	
   

  	
   

  	
   

  
	
  17.

  	
  CONFIDENTIAL
  INFORMATION

  	
  49

  
	
   

  	
   

  	
   

  
	
  18.

  	
  SUBSTITUTION
  OF PURCHASER

  	
  50

  
	
   

  	
   

  	
   

  
	
  19.

  	
  GUARANTY
  OF PARENT

  	
  50

  
	
   

  	
  19.1.

  	
  Guaranty

  	
  50

  
	
   

  	
  19.2.

  	
  Guaranty
  Absolute

  	
  51

  
	
   

  	
  19.3.

  	
  Waiver

  	
  51

  
	
   

  	
  19.4.

  	
  Continuing
  Guaranty; Assignments

  	
  52

  
	
   

  	
  19.5.

  	
  Subrogation

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
  20.

  	
  THE
  AGENT

  	
  52

  
	
   

  	
  20.1.

  	
  Authorization
  and Action

  	
  52

  
	
   

  	
  20.2.

  	
  Agent’s
  Reliance, Etc

  	
  53

  
	
   

  	
  20.3.

  	
  The
  Agent Individually

  	
  54

  
	
   

  	
  20.4.

  	
  Purchaser
  Credit Decision

  	
  54

  
	
   

  	
  20.5.

  	
  Indemnification

  	
  54

  
	
   

  	
  20.6.

  	
  Successor
  Administrative Agent

  	
  54

  
	
   

  	
  20.7.

  	
  Concerning
  the Collateral and the Pledge Agreement

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
  21.

  	
  MISCELLANEOUS

  	
  56

  
	
   

  	
  21.1.

  	
  Successors
  and Assigns

  	
  56

  
	
   

  	
  21.2.

  	
  Payments
  Due on Non-Business Days

  	
  56

  
	
   

  	
  21.3.

  	
  Satisfaction
  Requirement

  	
  56

  
	
   

  	
  21.4.

  	
  Severability

  	
  56

  
	
   

  	
  21.5.

  	
  Construction;
  Accounting Terms, Etc

  	
  56

  
	
   

  	
  21.6.

  	
  Computation
  of Time Periods

  	
  57

  
	
   

  	
  21.7.

  	
  Execution
  in Counterparts

  	
  57

  
	
   

  	
  21.8.

  	
  Governing
  Law; Submission to Jurisdiction, Etc

  	
  57

  
	
   

  	
  21.9.

  	
  Waiver
  of Jury Trial

  	
  58

  

 

iii

 

SCHEDULES
AND EXHIBITS 

 

	
  Schedule
  I

  	
  -

  	
  Information
  Relating to the Purchasers

  
	
  Schedule
  II

  	
  -

  	
  Defined
  Terms

  
	
  Schedule
  5.1

  	
  -

  	
  Good
  Standings

  
	
  Schedule
  5.5

  	
  -

  	
  Capitalization
  and Subsidiaries

  
	
  Schedule
  5.6

  	
  -

  	
  Litigation

  
	
  Schedule
  5.17

  	
  -

  	
  Environmental
  Matters

  
	
  Schedule
  5.19

  	
  -

  	
  Intellectual
  Property Matters

  
	
  Schedule
  5.23

  	
  -

  	
  Employee
  and Labor Matters

  
	
  Schedule
  8.1(a)(ii)

  	
  -

  	
  Indebtedness

  
	
   

  	
   

  	
   

  
	
  Exhibit
  A

  	
  -

  	
  Form
  of Note

  
	
  Exhibit
  B

  	
  -

  	
  Form
  of Notice of Sale and Purchase

  
	
  Exhibit
  C

  	
  -

  	
  Form
  of Subsidiary Guaranty

  
	
  Exhibit
  D

  	
  -

  	
  Form
  of Pledge Agreement

  
	
  Exhibit
  E

  	
  -

  	
  Form
  of U.S. Tax Compliance Certificate

  

 

iv

 

Vanguard Car Rental USA Inc.,

Alamo Rental (US) Inc.,

National Rental (US) Inc.

Vanguard Car Rental USA Holdings Inc.

 

15% Secured Senior Subordinated Notes due September 30, 2008

 

As of October 14, 2003

 

TO EACH OF THE PURCHASERS LISTED IN

SCHEDULE I ATTACHED HERETO:

 

Ladies
and Gentlemen:

 

Each
of Vanguard Car Rental USA Holdings Inc., a Delaware corporation (the
“Parent”), Vanguard Car Rental USA Inc., a Delaware corporation (“Vanguard “),
Alamo Rental (US) Inc., a Delaware corporation (“Alamo”) and National Rental
(US) Inc., a Delaware corporation (“National” and together with Vanguard and
Alamo, the “Companies”), hereby agrees with the purchasers party hereto
(together with their successors and assigns, collectively, the “Purchasers”)
and Madeleine L.L.C., a New York limited liability company, as administrative
agent and collateral agent for the Purchasers (in such capacities, the “Agent”)
as follows:

 

1.             AUTHORIZATION OF NOTES

 

The
Companies will authorize the issuance and sale of $60,000,000 aggregate
principal amount of their 15% Secured Junior Subordinated Notes due September
30, 2008 (the Notes delivered pursuant to Section 2 and any Notes issued in
substitution therefor pursuant to Section 10 being, collectively, the “Notes”).
Each of the Notes shall be in substantially the form of Exhibit A hereto, with
such amendments, supplements and other modifications thereto, if any, as shall
be approved from time to time by you and the Companies. Capitalized terms used
in this Agreement shall have the meanings specified in Schedule II.

 

2.             SALE AND PURCHASE OF NOTES.

 

2.1.          Obligation to Purchase. Subject to the terms and conditions of
this Agreement, the Companies will jointly and severally issue and sell to each
Purchaser, and each Purchaser will purchase from the Companies, on October 14,
2003 (the “Purchase Date”), Notes in an aggregate principal amount not to
exceed such Purchaser’s Commitment at such date. The obligations of the
Purchasers hereunder are several and not joint obligations, and no Purchaser
shall have any obligation hereunder and no liability to any Person for the
performance or nonperformance by any other Purchaser hereunder. The sale and
purchase of Notes pursuant to this Section 2.1 shall be in an aggregate
principal amount of $60,000,000. Notes purchased and sold under this Section
2.1 and repaid or prepaid may not be repurchased and resold.

 

 

2.2.          Notice of Purchase. The sale and purchase of Notes shall be
made upon notice, given not later than 11:00 A.M. (New York City time) on the
second Business Day prior to the Purchase Date, by the Companies to the Agent.
The notice of the proposed sale and purchase of Notes (the “Notice of Sale and
Purchase”) shall be by telephone, confirmed immediately in writing, or by
facsimile, in substantially the form of Exhibit B, specifying therein the
requested (a) Purchase Date (which shall be a Business Day), and
(b) aggregate principal amount of Notes to be purchased by each Purchaser
on the Purchase Date. On the Purchase Date, subject to the fulfillment of the
applicable conditions set forth in Section 4, the Companies will deliver to
each Purchaser the Notes to be purchased by such Purchaser on the Purchase Date
in the form of a single Note (or such greater number of Notes in denominations
of at least $1,000,000 or integral multiples of $100,000 in excess thereof as
such Purchaser may request at least one Business Day prior to the Purchase
Date), dated the Purchase Date and registered in the name of such Purchaser (or
in the name of such Purchaser’s nominee), duly executed by the Companies, against
delivery by such Purchaser to the Companies or their order of same day funds in
the amount of the aggregate purchase price therefor by wire transfer to
Worldwide Excellerated Leasing Ltd. as paying agent for the account of the
Companies pursuant to the following wire instructions:  Bank of America, ABA No.: 111-000-012,
Account Name:  Worldwide Excellerated
Leasing Ltd., Account No. 3752110931.

 

2.3.          Closing. The sale and purchase of the Notes to be purchased
by the Purchaser shall occur at the offices of Schulte Roth & Zabel LLP,
919 Third Avenue, New York, New York 10022, at or before 10:00 A.M. (New York
City time), at a closing on the Purchase Date.

 

2.4.          Interest.

 

(a)           Interest Rate. Except as provided in subsection (b)
below, each Note shall bear interest on the principal amount thereof, for each
day during which such principal amount is outstanding, at a rate per annum
equal to 15%.

 

(b)           Default Interest. To the extent permitted by law, upon
the occurrence and during the continuance of an Event of Default, the principal
of, and all accrued and unpaid interest on, all Notes, and all fees,
indemnities and other Obligations of the Credit Parties under this Agreement
and the other Note Documents, shall bear interest, from the date such Event of
Default occurred until such Event of Default is cured or waived in writing in
accordance herewith, at a rate per annum equal at all times to the Default
Rate.

 

(c)           Interest Payments. Interest payable pursuant to subsection
(a) above shall be payable monthly in arrears, on the first day of each
calendar month, commencing November 1, 2003 (provided that, so long as no
Default or Event of Default shall have occurred and be continuing, up to 50% of
the interest due on any payment date may be capitalized and added to principal
on such interest payment date to the extent provided in a notice delivered by
the Companies to the Agent no earlier than 10 Business Days and no later than
five Business Days prior to such interest payment date, specifying the amount
of interest due on such date that is to be so capitalized and added to
principal on such monthly interest payment date) and at maturity (whether upon
demand, by acceleration or otherwise). Interest payable pursuant to subsection
(b) above shall be payable in cash on demand.

 

2

 

(d)           General. All interest shall be computed on the basis of a
year of 360 days for the actual number of days, including the first day but
excluding the last day, elapsed.

 

2.5.          Fees. The Companies shall pay to the Purchasers the
following fees and charges, which fees and charges shall be non-refundable when
paid (irrespective of whether this Agreement is terminated thereafter):

 

(a)           Closing Fee. A fee of $900,000 (the “Closing Fee”)
will be earned as of the Purchase Date and shall be and payable on the Purchase
Date to the Purchasers in proportion to their respective Pro Rata Shares.

 

(b)           Anniversary Fee. A fee of $900,000 will be earned as of
each anniversary of the Purchase Date and shall be payable on such date to the
Purchasers in proportion to their respective Pro Rata Shares.

 

3.             PAYMENTS; NATURE OF COMPANIES’
OBLIGATIONS.

 

3.1.          Payments and Computations. The Companies will make each payment
under this Agreement not later than 1:00 p.m. (New York City time) on the day
when due, in lawful money of the United States of America and in immediately
available funds, to the Agent’s Account. All payments received by the Agent
after 1:00 p.m. (New York City time) on any Business Day will be credited on
the next succeeding Business Day. All payments shall be made by the Companies
without set-off, counterclaim, deduction or other defense to the Agent and the
Purchasers. After receipt, the Agent will promptly thereafter cause to be
distributed like funds relating to the payment of principal ratably to the
Purchasers in accordance with their Pro Rata Shares and like funds relating to
the payment of any other amount payable to any Purchaser to such Purchaser, in
each case to be applied in accordance with the terms of this Agreement.
Whenever any payment to be made under any such Note Document shall be stated to
be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day and such extension of time shall in such case be
included in the computation of interest or fees, as the case may be. All
computations of fees shall be made by the Agent on the basis of a year of 360
days for the actual number of days, including the first day but excluding the
last day, elapsed. Each determination by the Agent of an interest rate or fees
hereunder shall be conclusive and binding for all purposes in the absence of
manifest error.

 

3.2.          Sharing of Payments, Etc. If any Purchaser shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of any Obligation in excess of its ratable
share of payments on account of similar obligations obtained by all of the
Purchasers, such Purchaser shall forthwith purchase from the other Purchasers
such participations in such similar obligations held by them as shall be
necessary to cause such purchasing Purchaser to share the excess payment
ratably with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Purchaser, such purchase from each Purchaser shall be rescinded and such
Purchaser shall repay to the purchasing Purchaser the purchase price to the
extent of such recovery together with an amount equal to such Purchaser’s
ratable share (according to the proportion of (i) the amount of such
Purchaser’s required repayment to (ii) the total amount so recovered from the
purchasing Purchaser of any interest or other amount paid by the purchasing

 

3

 

Purchaser in respect of the total amount so
recovered). The Companies agree that any Purchaser so purchasing a
participation from another Purchaser pursuant to this Section 3.2 may, to
the fullest extent permitted by law, exercise all of its rights (including such
Purchaser’s right of set-off) with respect to such participation as fully as if
such Purchaser were the direct creditor of the Companies in the amount of such
participation.

 

3.3.          Apportionment of Payments.

 

(a)           All payments of principal and interest in
respect of outstanding Notes, all payments of fees, and all other payments in
respect of any other Obligations shall be allocated by the Agent among such of
the Purchasers as are entitled thereto, in proportion to their respective Pro
Rata Shares or otherwise as provided herein or, in respect of payments not made
on account of the Notes, as designated by the Person making payment when the
payment is made.

 

(b)           After the occurrence and during the
continuance of an Event of Default, the Agent may, and upon the direction of
the Required Holders shall, apply all payments in respect of any Obligations
and all proceeds of the Collateral, subject to the provisions of this
Agreement, (i) first, ratably to pay the Obligations in respect of any
fees, expense reimbursements, indemnities and other amounts then due to the
Agent until paid in full; (ii) second, ratably to pay the
Obligations in respect of any fees and indemnities then due to the Purchasers
until paid in full; (iii) third, ratably to pay interest due in
respect of the Notes until paid in full; (iv) fourth, ratably to
pay principal of the Notes until paid in full; and (v)  fifth, to
the ratable payment of all other Obligations then due and payable.

 

3.4.          Joint and Several Liability of the
Companies.

 

(a)           Notwithstanding anything in this
Agreement or any other Note Document to the contrary, each of the Companies
hereby accepts joint and several liability hereunder and under the other Note
Documents in consideration of the financial accommodations to be provided by
the Agent and the Purchasers under this Agreement and the other Note Documents,
for the mutual benefit, directly and indirectly, of each of the Companies and
in consideration of the undertakings of the other Companies to accept joint and
several liability for the Obligations. Each of the Companies, jointly and
severally, hereby irrevocably and unconditionally accepts, not merely as a
surety but as a co-debtor, joint and several liability with the other
Companies, with respect to the payment and performance of all of the
Obligations (including, without limitation, any Obligations arising under this
Section 3.4, it being the intention of the parties hereto that all of the
Obligations shall be the joint and several obligations of each of the Companies
without preferences or distinction among them). If and to the extent that any
of the Companies shall fail to make any payment with respect to any of the
Obligations as and when due or to perform any of the Obligations in accordance
with the terms thereof, then in each such event, the other Companies will make
such payment with respect to, or perform, such Obligation. Subject to the terms
and conditions hereof, the Obligations of each of the Companies under the
provisions of this Section 3.4 constitute the absolute and unconditional, full
recourse Obligations of each of the Companies, enforceable against each such
Person to the full extent of its properties and assets, irrespective of the
validity, regularity or enforceability of this Agreement, the other Note
Documents or any other circumstances whatsoever.

 

4

 

(b)           The provisions of this Section 3.4 are
made for the benefit of the Agent, the Purchasers and their successors and
assigns, and may be enforced by them from time to time against any or all of
the Companies as often as occasion therefor may arise and without requirement
on the part of the Agent, the Purchasers or such successors or assigns first to
marshal any of its or their claims or to exercise any of its or their rights
against any of the other Companies or to exhaust any remedies available to it
or them against any of the other Companies or to resort to any other source or
means of obtaining payment of any of the Obligations hereunder or to elect any
other remedy. The provisions of this Section 3.4 shall remain in effect until
all of the Obligations shall have been paid in full or otherwise fully
satisfied.

 

(c)           Each of the Companies hereby agrees that
it will not enforce any of its rights of contribution or subrogation against
the other Companies with respect to any liability incurred by it hereunder or
under any of the other Note Documents, any payments made by it to the Agent or
the Purchasers with respect to any of the Obligations or any Collateral, until
such time as all of the Obligations have been paid in full in cash. Any claim
which any Company may have against any other Company with respect to any
payments to the Agent or the Purchasers hereunder or under any other Note
Documents are hereby expressly made subordinate and junior in right of payment,
without limitation as to any increases in the Obligations arising hereunder or
thereunder, to the prior payment in full in cash of the Obligations.

 

4.             CONDITIONS TO THE PURCHASE.

 

The
obligation of each Purchaser to purchase and pay for the Notes to be sold to
such Purchaser on the Purchase Date is subject to the fulfillment, on or prior
to the Purchase Date, of the following conditions:

 

4.1.          Documents Required. Such Purchaser shall have received the
following documents, each dated as of the Purchase Date (except as otherwise
specified below) and in the form of the respective Exhibit hereto, if any, or
otherwise in form and substance satisfactory to such Purchaser:

 

(a)           Note Purchase Agreements. This Agreement, duly executed by each
of the Companies.

 

(b)           Notice of Sale and Purchase. The Notice of Sale and Purchase,
properly completed and duly executed by each of the Companies.

 

(c)           Notes. Notes, each registered in the name of a Purchaser,
in such aggregate principal amount as is specified to be purchased by such
Purchaser in the Notice of Sale and Purchase and in such number of Notes and in
such denominations (of at least $1,000,000 per Note) as are specified to the
Companies by such Purchaser at least one Business Day prior to the Purchase
Date (and in the absence of such specification, in a single Note), in each case
duly executed by each of the Companies.

 

(d)           Subsidiary Guaranty. The Subsidiary Guaranty, duly executed by
each of Vanguard Car Rental Claims Inc., Vanguard Real Estate Holdings LLC and
Alamo Rent-A-Car (Canada), Inc.

 

5

 

(e)           Pledge Agreement. The Pledge Agreement, duly executed by
each Company that is a party thereto on the Purchase Date, together with such
appropriate financing statements duly filed in such office or offices as may be
necessary or, in the Agent’s opinion, desirable to perfect the security
interests purported to be created by the Pledge Agreement.

 

(f)            Intercreditor Agreements. The Intercreditor Agreements, duly
executed by all the parties thereto and duly acknowledged by the applicable
Obligors (as defined therein).

 

(g)           Lien Searches. Appropriate searches, listing all
effective financing statements which name as debtor any Credit Party, together
with copies of such financing statements, none of which, except as agreed to in
writing by the Agent, shall cover any of the Collateral and the results of
searches for any tax Lien and judgment Lien filed against such Person or its
property or assets, which results, except as agreed to in writing by the Agent,
shall not show any such Liens.

 

(h)           Corporate Approvals and Other Similar
Documentation.
Certified copies of the resolutions of the board of directors of each Credit
Party approving each of the Note Documents to which it is or is to be a party,
the issuance and sale of the Notes or the guarantee thereof, as applicable, and
the other transactions contemplated hereby and thereby and all documents evidencing
other necessary corporate action with respect to each such Note Document, the
issuance and sale of the Notes or the guarantee thereof, as applicable, and the
other transactions contemplated hereby and thereby.

 

(i)            Organizational Documents. A copy of the certificate of
incorporation of each Credit Party and each amendment thereto, certified as of
a date reasonably near the Purchase Date by the appropriate official of the
state of such Person’s formation as being a true and complete copy thereof, including
any amendments thereto.

 

(j)            Good Standing Certificates. A copy of a certificate of the
appropriate official of the state of incorporation of each Credit Party, dated
reasonably near the Purchase Date, listing the certificate of incorporation of
such Person and each amendment thereto on file in the office of such official
and certifying that (i) such amendments are the only amendments to such
certificate of such Person on file in the office of such person, (ii) such
Person has paid all franchise taxes (or the equivalent thereof) to the date of
such certificate and (iii) such Person is duly incorporated or formed, as
applicable and in good standing under the laws of such state.

 

(k)           Secretary’s Certificate. A certificate of the secretary or an
assistant secretary (or a person performing similar functions) of each Credit
Party certifying:

 

(i)            the absence of any amendments to the
certificate of incorporation of any Credit Party since the date of the
certificate referred to in subsection (j) of this Section 4.1;

 

(ii)           the completeness and accuracy of the
resolutions of the board of directors of each Credit Party and all documents
evidencing other necessary corporate action thereof referred to in
subsection (h) of this Section 4.1;

 

6

 

(iii)          the completeness and accuracy of the
bylaws of each Credit Party as in effect on the date the resolutions of the
board of directors of such Person referred to in subsection (h) of this
Section 4.1 were adopted and on the Purchase Date (a copy of which shall
be attached to such certificate); and

 

(iv)          the names and true signatures of the
officers of each Credit Party authorized to sign each of the Note Documents to
which it is or is to be a party and the other agreements, instruments and other
documents to be delivered hereunder or thereunder.

 

(l)            Officer’s Certificate. A certificate of the Treasurer of
Vanguard, certifying as to:

 

(i)            the absence of any proceeding for the
dissolution or liquidation of any of the Parent and the Companies;

 

(ii)           the completeness and accuracy in all
material respects of all of the representations and warranties made by each
Credit Party in this Agreement and the other Note Documents to which it is or
is to be a party, before and after giving effect to the issuance and sale of
the Notes and to the application of the proceeds thereof as contemplated by
Section 5.12, as though made on and as of the Purchase Date;

 

(iii)          the absence of any event occurring and
continuing, or resulting from the issuance and sale of the Notes or the
consummation of any of the other transactions contemplated hereby, that
constitutes a Default or an Event of Default; and

 

(iv)          to the best knowledge of such person, the
absence of any existing or threatened event or circumstance applicable to any
Credit Party that could reasonably be expected to impair the ability of any
Credit Party to consummate the transactions contemplated hereby.

 

(m)          Financing Documents. To the extent requested by the Agent, a
copy of each of the Senior Financing Documents, the Senior Subordinated
Indebtedness Documents, the Junior Holdings Subordinated Indebtedness Agreement
and any and all other documents evidencing any vehicle financing provided to
any of the Companies and their respective Subsidiaries, in each case certified
by a Responsible Officer as being a true and complete copy.

 

(n)           The Sale Order. A copy of the Sale Order, certified by
a Responsible Officer as being a true and complete copy.

 

(o)           Acquisition Agreement. A copy of the Acquisition Agreement,
certified by a Responsible Officer as being a true and complete copy.

 

(p)           Equity Documents. To the extent requested by the Agent, a
copy of each Equity Document, certified by a Responsible Officer as being a
true and complete copy.

 

(q)           Insurance and Surety Bonding. A copy of each of the Liberty
Agreements and, to the extent requested by the Agent, all agreements,
instruments and other

 

7

 

documents executed in connection therewith or
otherwise relating to the provisions of insurance bonds for the benefit of the
Companies and their Subsidiaries, each certified by a Responsible Officer as
being a true and correct copy, and such other evidence of the insurance
coverage required by this Agreement as the Agent may request.

 

(r)            Information Technology. A copy of the Perot Agreement,
certified as being a true and correct copy.

 

4.2.          The Sale Order. The Sale Order (a) shall have been
entered by the Bankruptcy Court, (b) shall be in full force and effect, and (c)
shall not have been reversed, stayed, modified or amended. No appeals shall
have been filed within the time period specified by Rule 8002(a) of the
Federal Rules of Bankruptcy Procedure or, in the event a timely appeal has been
filed, the effectiveness of the Sale Order shall not have been stayed in
accordance with Rule 8005 of the Federal Rules of Bankruptcy Procedure,
and CAR Acquisition Company LLC shall not have exercised its termination right
under Section 7.16(viii)(3) of the Acquisition Agreement within 20 days from
the date such appeal is filed.

 

4.3.          The Acquisition. The Acquisition shall have been
consummated in accordance with all applicable law, the Acquisition Agreement
(without any material amendment or modification thereto) and the Sale Order.
All conditions precedent to the consummation of the Acquisition, whether set
forth in the Acquisition Documents or otherwise, shall have been satisfied (or,
with the prior written consent of Required Holders, waived).

 

4.4.          Capitalization.

 

(a)           The Investors shall have made a cash
equity investment of not less than $100,000,000 in Worldwide, and the proceeds
of such equity investment shall have been applied to consummate the Acquisition
and the other transactions contemplated by the Documents.

 

(b)           The Senior Financing Agreement and the
other Senior Financing Documents to be executed and delivered on or prior to
the Purchase Date shall have been executed and delivered by each party thereto
and shall have become effective in accordance with their respective terms, and
all loans to be made thereunder on the Purchase Date shall have been made and
the proceeds thereof shall have been applied in accordance with the terms of
the Senior Financing Agreement, and, after giving effect to such loans and the
sale of all Notes to be sold on the Purchase Date, the consummation of the
Acquisition, the deposit of all cash collateral required pursuant to the
Liberty Agreement, the payment of all fees and expenses related the
Acquisition, and the payment of all Cure Costs (as defined in the Acquisition
Agreement) (and provided accounts payable are at a level and in a condition
reasonably satisfactory to the Purchasers), opening availability under the
Revolving Credit Facility is at least $100,000,000.

 

(c)           The Senior Subordinated Indebtedness
Documents shall have been executed and delivered by each party thereto and
shall have become effective in accordance with their respective terms and all
notes to be purchased thereunder shall have been purchased for cash at par and the
proceeds thereof shall have been applied in accordance with the terms of the
Senior Subordinated Indebtedness Documents.

 

8

 

(d)           The Junior Holdings Subordinated
Indebtedness Agreement shall have been executed and delivered by each party
thereto and shall have become effective in accordance with its terms and all
notes to be purchased thereunder shall have been purchased for cash at par and
the proceeds thereof shall have been applied in accordance with the terms of
the Junior Holdings Subordinated Indebtedness Agreement.

 

4.5.          Insurance and Surety Bonding Requirements. The Liberty Agreement and all material
agreements, instruments and other documents to be executed in connection
therewith or otherwise relating to the provision of insurance bonds for the
benefit of the Companies and their Subsidiaries shall have been executed and
delivered by each party thereto and shall have become effective in accordance
with their respective terms.

 

4.6.          Information Technology. The Perot Agreement shall have been
executed and delivered by each party thereto and shall have become effective in
accordance with its terms.

 

4.7.          Payment of Accrued Fees and Expenses. Without limiting the provisions of
Section 12.1, all of the accrued fees and expenses incurred by the
Purchasers in connection with the transactions contemplated by this Agreement
and the other Note Documents to be paid by or on behalf of the Companies on or
prior to the Purchase Date shall have been paid.

 

4.8.          Representations and Warranties. The representations and warranties of
the Parent and the Companies contained in the Note Documents shall be complete
and correct on the date of the Notice of Sale and Purchase and on the Purchase
Date, before and after giving effect to the issue and sale of the Notes and to
the application of the proceeds thereof as contemplated by
Section 5.12(a).

 

4.9.          No Default. After giving effect to the issuance and sale of the
Notes and to the application of the proceeds thereof as contemplated by
Section 5.12(a), no Default or Event of Default shall have occurred and be
continuing.

 

4.10.        Purchase Permitted by Applicable
Requirements of Law, Etc. The purchase of and any payment for the Notes to be
purchased by the Purchasers on the Purchase Date (a) shall not violate any
applicable Requirements of Law (including, without limitation, Regulation T, U
or X of the Board of Governors of the Federal Reserve System) and
(b) shall not subject any Purchaser to any tax, penalty or other liability
under or pursuant to any applicable Requirements of Law, except for any Taxes
or Other Taxes for which the Companies are obligated to compensate you under
Section 12.3.

 

4.11.        Consents and Approvals. All Governmental Authorizations and all
consents, approvals and authorizations of any other Person required to be
obtained in connection with the consummation of the transactions contemplated
by the Documents (other than the Note Documents), except those consents,
approvals and authorizations the failure to obtain could not reasonably be
expected to have a Material Adverse Effect, shall have been obtained and shall
remain in full force and effect; and all applicable waiting periods shall have
expired without any action being taken by any Governmental Authority that could
reasonably be expected to restrain, prevent or impose any material adverse
conditions on the Companies, the Acquisition, the

 

9

 

issuance and sale of the Notes, or the consummation of
any of the other transactions contemplated by the Documents (other than the
Note Documents).

 

4.12.        No Litigation or Other Proceedings. There shall exist no claim, action,
suit, investigation, litigation or proceeding pending or, to the best knowledge
of the Credit Parties, threatened against or affecting any Credit Party or any
of the property or assets thereof in any court or before any arbitrator or by
or before any other Governmental Authority that (a) could reasonably be
expected to have a Material Adverse Effect or (b) challenges the legality,
validity, binding effect or enforceability of the Acquisition Agreement, any
Note Document, the issuance and sale of the Notes, or the consummation of any
of the other transactions contemplated by the Documents.

 

5.             REPRESENTATIONS AND WARRANTIES OF THE
CREDIT PARTIES

 

Each
of the Parent and the Companies represents and warrants to the Purchasers that:

 

5.1.          Organization, Good Standing, Etc. Each Credit Party (a) is a corporation
duly organized, validly existing and in good standing under the laws of the
state of its organization, (b) has all requisite power and authority to conduct
its business as now conducted and as presently contemplated (both before and
after giving effect to the Acquisition) and, in the case of the Companies, to
execute the Notes hereunder, and to execute and deliver each Document to which
it is a party, and to consummate the transactions contemplated thereby, and (c)
except as set forth in Schedule 5.1, before and after giving effect to the
Acquisition, is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the properties owned or leased by it or
in which the transaction of its business makes such qualification necessary.

 

5.2.          Authorization, Etc. The execution, delivery and performance
by each Credit Party of each Note Document to which it is or will be a party
(a) have been duly authorized by all necessary action, (b) do not and will not
contravene its charter or by-laws, or any applicable Requirement of Law or any
contractual restriction binding on or otherwise affecting it or any of its
properties, (c) do not and will not result in or require the creation of any
Lien (other than pursuant to any Note Document) upon or with respect to any of
its properties, and (d) do not and will not result in any default,
noncompliance, suspension, revocation, impairment, forfeiture or nonrenewal of
any permit, license, authorization or approval applicable to its operations or
any of its properties.

 

5.3.          Governmental Approvals. No authorization or approval or other
action by, and no notice to or filing with, any Governmental Authority is
required in connection with the due execution, delivery and performance by any
Credit Party of any Note Document to which it is or will be a party.

 

5.4.          Enforceability of Note Documents. This Agreement is, and each other Note
Document to which any Credit Party is or will be a party, when delivered, will
be, a legal, valid and binding obligation of such Credit Party, enforceable
against such Credit Party in

 

10

 

accordance with its terms, except as may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws.

 

5.5.          Subsidiaries. Schedule 5.5 is a complete and correct
description of the name, jurisdiction of incorporation and ownership of the
outstanding Capital Stock of each Credit Party and its Subsidiaries in
existence on the date hereof after giving effect to the Acquisition. After
giving effect to the Acquisition, all of the issued and outstanding shares of
such Capital Stock have been validly issued and are fully paid and
nonassessable, and the holders thereof are not entitled to any preemptive,
first refusal or other similar rights. Except as indicated on such Schedule
5.5, all such Capital Stock is owned by the respective equity holders, as shown
on such Schedule 5.5, free and clear of all Liens. There are no
outstanding debt or equity securities of a Credit Party or any of its
Subsidiaries and no outstanding obligations of a Credit Party or any of its
Subsidiaries that are convertible into or exchangeable for, or warrants,
options or other rights for the purchase or acquisition from such Credit Party
or any of its Subsidiaries, or other obligations of a Credit Party or any of
its Subsidiaries to issue, directly or indirectly, any shares of Capital Stock
of such Credit Party or any of its Subsidiaries.

 

5.6.          Litigation. Except as set forth on Schedule 5.6, there is
no pending or, to the knowledge of any Credit Party, threatened action, suit or
proceeding affecting any Credit Party or any of its Subsidiaries or any of
their respective properties before any court or other Governmental Authority or
any arbitrator that (i) could reasonably be expected to have a Material
Adverse Effect or (ii) relates to this Agreement, the Notes or any other
Note Document or any transaction contemplated hereby or thereby.

 

5.7.          Financial Condition.

 

(a)           Since June 30, 2003, no event or
development has occurred that has had or could reasonably be expected to have a
Material Adverse Effect.

 

(b)           The Parent has heretofore furnished to the
Purchasers unaudited pro forma condensed consolidated financial statements for
the six-month period ended June 30, 2003 and for the year ended December 31,
2002, giving effect to the Acquisition and the other transactions contemplated
by the Documents as if each had occurred as of the beginning of such respective
periods. Such financial statements have been prepared on a reasonable basis and
in good faith by the Parent and have been based on preliminary estimates,
available information and certain assumptions believed by the Parent to be
reasonable.

 

5.8.          Compliance with Law, Etc. None of the Credit Parties and their
Subsidiaries is in violation of its organizational documents, any Requirement
of Law applicable to it or any of its property or assets, or any material term
of any agreement or instrument binding on or otherwise affecting it or any of
its properties or assets, the violation of which could reasonably be expected
to have a Material Adverse Effect.

 

5.9.          ERISA. (a) each Employee Plan is in substantial compliance
with ERISA and the IRC, (b) no Termination Event has occurred or is
reasonably expected to occur with respect to any Employee Plan, (c) no Employee
Plan had an accumulated or waived funding deficiency or permitted decreases
which would create a deficiency in its funding standard

 

11

 

account or has applied for an extension of any
amortization period within the meaning of Section 412 of the IRC at any
time during the previous 60 months, (d) no Lien imposed under the IRC
or ERISA exists or is likely to arise on account of any Employee Plan within
the meaning of Section 412 of the IRC at any time during the previous
60 months, and (e) no Credit Party or any of its ERISA Affiliates has
incurred any withdrawal liability under ERISA with respect to any Multiemployer
Plan, or is aware of any facts indicating that the Credit Parties or any of their
ERISA Affiliates may in the future incur any such withdrawal liability. No
Credit Party or any of its ERISA Affiliates or any fiduciary of any Employee
Plan has (A) engaged in a nonexempt prohibited transaction described in Section
406 of ERISA or Section 4975 of the IRC, (B) failed to pay any required
installment or other payment required under Section 412 of the IRC on or before
the due date for such required installment or payment, (C) engaged in a
transaction within the meaning of Section 4069 of ERISA or (D) incurred any
liability to the PBGC which remains outstanding other than the payments of
premiums, and there are no premium payments that have become due and that are
unpaid. There are no pending or, to the knowledge of any Credit Party,
threatened claims, actions, proceedings or lawsuits (other than claims for
benefits in the normal course) asserted or instituted against any Employee Plan
or its assets, any fiduciary with respect to any Employee Plan, or any Credit
Party or any of its ERISA Affiliates with respect to any Employee Plan.

 

5.10.        Health Benefits; WARN. Except as required by Section 4980B of
the IRC, no Credit Party or any of its ERISA Affiliates maintains an employee
welfare benefit plan (as defined in Section 3(1) of ERISA) which provides health
or welfare benefits (through the purchase of insurance or otherwise) for any
retired or former employee of any Credit Party or any of its ERISA Affiliates
or coverage after a participant’s termination of employment. No Credit Party or
any of its ERISA Affiliates has incurred any liability or obligation under the
Worker Adjustment and Retraining Notification Act (“WARN”) or similar
state law, which remains unpaid or unsatisfied.

 

5.11.        Taxes, Etc. All Federal, state and local tax returns
and other reports required by applicable law to be filed by any Credit Party
have been filed, or extensions have been obtained, and all taxes, assessments
and other governmental charges imposed upon any Credit Party or any property of
any Credit Party and which have become due and payable on or prior to the date
hereof have been paid, except to the extent contested in good faith by proper
proceedings which stay the imposition of any penalty, fine or Lien resulting
from the non-payment thereof and with respect to which adequate reserves have
been set aside for the payment thereof in accordance with GAAP.

 

5.12.        Use of Proceeds; Margin Regulations.

 

(a)           The proceeds received from the issuance
and sale of the Notes will be used (i) to pay a portion of the purchase price
for the Assets pursuant to the Acquisition Agreement, (ii) to refinance
existing indebtedness in connection with the Acquisition, and (iii) to pay fees
and expenses related to the Acquisition and the financing thereof.

 

(b)           None of the Companies nor any of their
Subsidiaries is engaged in the business of extending credit for the purpose of
purchasing or carrying any “margin stock” (within the meaning of Regulation U
of the Board of Governors of the Federal Reserve System).

 

12

 

No part of the proceeds from the sale of the Notes
will be used, directly or indirectly, for the purpose of purchasing or carrying
any margin stock or for the purpose of purchasing, carrying or trading in any
securities under such circumstances as to involve the Companies or any of their
Subsidiaries in a violation of Regulation X of the Board of Governors of the
Federal Reserve System (12 CFR 224) or to involve any broker or dealer in
a violation of Regulation T of the Board of Governors of the Federal Reserve
System. None of the transactions contemplated by this Agreement and the other
Note Documents (including, without limitation, the direct and indirect use of
proceeds of the Notes) will violate or result in a violation of the Exchange Act
or any of the rules and regulations promulgated thereunder or in such
Regulation T, U or X, as applicable, or, assuming the accuracy of the
representations and warranties made by the Purchasers in this Agreement the
Securities Act or any of the rules and regulations promulgated thereunder.

 

5.13.        Nature of Business. After giving effect to the
Acquisition:  (a) no Company has or is
engaged in any business other than a Permitted Business, and (b) the Parent has
not and is not engaged in any business activities other than (i) the ownership
of the Capital Stock of Vanguard and its other direct Subsidiaries as set forth
on Schedule 5.5 and (ii) the entering into, and performing its obligations and
exercising its rights under, the Documents to which it is a party..

 

5.14.        Permits, Etc. Before and after giving effect to the
Acquisition, each Credit Party has, and is in material compliance with, all
permits, licenses, authorizations, approvals, entitlements and accreditations
required for such Credit Party lawfully to own, lease, manage or operate, or to
acquire, each business currently owned, leased, managed or operated, or to be
acquired, by such Person, except for those permits, licenses, authorizations,
approvals, entitlements and accreditations, the failure to have or to be in
compliance with which could reasonably be expected to have a Material Adverse
Effect.

 

5.15.        Properties. After giving effect to the Acquisition, each Credit
Party has good and marketable title to, valid leasehold interests in, or valid
licenses to use, all property and assets material to its business, free and
clear of all Liens except Permitted Liens. All such properties and assets are
in good working order and condition, ordinary wear and tear excepted.

 

5.16.        Full Disclosure. None of the reports, financial
statements, certificates or other information furnished by or on behalf of any
Credit Party to the Agent or any Purchaser in connection with the negotiation
of this Agreement or delivered hereunder (as modified or supplemented by other information
so furnished) contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which it was made, not misleading; provided, however,
that, with respect to projected financial information, each Credit Party
represents only that such information was prepared in good faith based upon
assumptions believed to be reasonable at the time.

 

5.17.        Environmental Matters. Except as set forth on
Schedule 5.17, (a) the operations of each Credit Party are in
compliance in all material respects with Environmental Laws, the noncompliance
with which could not reasonably be expected to have a Material Adverse Effect;
(b) there has been no Release at any of the properties owned or operated by any
Credit Party or a predecessor in interest, or at any disposal or treatment
facility which received Hazardous

 

13

 

Materials generated by any Credit Party or any
predecessor in interest which in either case could reasonably be expected to
have a Material Adverse Effect; (c) no Environmental Action has been asserted
against any Credit Party or any predecessor in interest and no Credit Party has
knowledge or notice of any threatened or pending Environmental Action against
any Credit Party or any predecessor in interest which in either case could
reasonably be expected to have a Material Adverse Effect; and (d) no
Environmental Actions have been asserted against any facilities that may have
received Hazardous Materials generated by any Credit Party or any predecessor
in interest which could reasonably be expected to have a Material Adverse
Effect.

 

5.18.        Solvency. After giving effect to the Acquisition and the other
transactions contemplated by the Documents, each Credit Party is, and the
Parent and its Subsidiaries on a consolidated basis are, Solvent.

 

5.19.        Intellectual Property. Except as set forth on
Schedule 5.19 and after giving effect to the Acquisition, each Credit
Party owns or licenses or otherwise has the right to use all licenses, patents,
patent applications, trademarks, trademark applications, service marks, trade
names, copyrights, copyright applications and other intellectual property
rights that are material to, and necessary for, the operations of its
businesses, without infringement upon or conflict with the rights of any other
Person with respect thereto, except for such infringements and conflicts that
could not reasonably be expected to have a Material Adverse Effect. To the best
knowledge of the Parent, no slogan or other advertising device, product,
process, method, substance, part or other material now employed, or now
contemplated to be employed, by any Credit Party infringes upon or conflicts
with any rights owned by any other Person, and no claim or litigation regarding
any of the foregoing is pending or threatened, except for such infringements
and conflicts that could not reasonably be expected to have a Material Adverse
Effect.

 

5.20.        Material Contracts. Each Material Contract (a) is in
full force and effect and is binding upon and enforceable against each Credit
Party that is a party thereto and, to the best knowledge of such Credit Party,
all other parties thereto in accordance with its terms, (b) has not been
otherwise amended or modified, and (c) is not in default due to the action of
any Credit Party or, to the best knowledge of any Credit Party, any other party
thereto except as to any default that could not reasonably be expected to have
a Material Adverse Effect.

 

5.21.        Private Placement.

 

(a)           No form of general solicitation or
general advertising was used by the Parent, any of the Companies, or, to the
best knowledge of the Parent and the Companies, any other Person acting on
behalf of any of them, in respect of this Agreement or the other Note Documents
or in connection with the offer and sale of the Notes.

 

(b)           Assuming the accuracy of the
representations and warranties contained in Section 6.1, the execution and
delivery of this Agreement and the other Note Documents constitute transactions
exempt from the registration requirements of the Securities Act.

 

14

 

5.22.        Investment Company Act. None of the Credit Parties nor any of
their Subsidiaries is an “investment company” or a company controlled by an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended. None of the sale and purchase of the Notes, the application of the
proceeds therefrom or the repayment of the Notes by the Companies and the
consummation of the other transactions contemplated by the Note Documents will
violate any provision of such Act or any rule, regulation or order of the
Securities and Exchange Commission thereunder.

 

5.23.        Employee and Labor Matters. Except as set forth on
Schedule 5.23, there is (a) no unfair labor practice complaint pending or,
to the best knowledge of any Credit Party, threatened against any Credit Party
or any of its Subsidiaries before any Governmental Authority and no grievance
or arbitration proceeding pending or threatened against any Credit Party or any
of its Subsidiaries which arises out of or under any collective bargaining
agreement, (b) no strike, labor dispute, slowdown, stoppage or similar action
or grievance pending or threatened against any Credit Party or any of its
Subsidiaries or (c) to the best knowledge of any Credit Party, no union
representation question existing with respect to the employees of any Credit
Party or any of its Subsidiaries and no union organizing activity taking place
with respect to any of the employees of any of them which could be reasonably
likely to have a Material Adverse Effect. The hours worked and payments made to
employees of any Credit Party or any of its Subsidiaries have not been in violation
of the Fair Labor Standards Act or any other applicable legal requirements.
After giving effect to the Acquisition, all material payments due from any
Credit Party or any of its Subsidiaries on account of wages and employee health
and welfare insurance and other benefits have been paid or accrued as a
liability on the books of such Credit Party or such Subsidiary.

 

5.24.        Representations and Warranties in
Documents; No Default. All representations and warranties of the Credit Parties, and, to the
best knowledge of the Credit Parties, the other parties to the Documents (other
than the Note Documents) that are set forth in such Documents were true and
correct in all material respects at the time as of which such representations
were made and will be true and correct in all material respects on the Purchase
Date. No condition exists which constitutes a Default or an Event of Default.

 

6.             REPRESENTATIONS OF THE PURCHASERS.

 

6.1.          Purchase for Investment. Each Purchaser represents that it is
purchasing the Notes to be purchased by it hereunder for its own account or for
one or more separate accounts maintained by such Purchaser and not with a view
to the distribution thereof; provided that the disposition of any such
Person’s property shall at all times be within such Person’s control. Each
Purchaser understands that the Notes have not been registered under the
Securities Act and may be resold only if registered pursuant to the provisions
of the Securities Act or if an exemption from registration is available, except
under circumstances where neither such registration nor such an exemption is
required by applicable law.

 

6.2.          Accredited Investor. Each Purchaser is an “accredited
investor” (as defined in Rule 501 of Regulation D under the
Securities Act) and, by reason of its business and financial experience, and
the business and financial experience of those Persons retained by it to advise
it with respect to its investment in the Notes, such Purchaser, together with
such advisors,

 

15

 

has such knowledge, sophistication and experience in
business and financial matters as to be capable of evaluating the merits and
risks of the prospective investment, is able to bear the economic risk of such
investment and, at the present time, is able to afford a complete loss of such
investment. Such Purchaser is not purchasing the Notes in reliance upon any
investigation made by any of the other Purchasers.

 

7.             PREPAYMENTS AND REPURCHASES OF THE NOTES.

 

7.1.          Optional Prepayments of the Notes. The Companies may, at their option,
upon not less than ten days’ prior notice to the Agent and the holders of the
Notes, prepay all or any portion of the Notes, in an aggregate principal amount
of $1,000,000 or integral multiples of $100,000 in excess thereof (or, if less,
the remaining aggregate principal amount of all Notes outstanding at such
time), at a purchase price in cash equal to 100% of the face amount of the
Notes so prepaid, plus all accrued and unpaid interest thereon, if any, to the
date of such prepayment. Each notice of an optional prepayment of the Notes
pursuant to this Section 7.1 shall specify the date fixed for such prepayment,
the aggregate principal amount of the Notes to be prepaid on such date, the
principal amount of each Note held by such holder to be prepaid (determined in
accordance with Section 7.4) and the interest to be paid on the prepayment date
with respect to such principal amount being prepaid, and shall state that such
prepayment is to be made pursuant to this Section 7.1.

 

7.2.          Offer to Repurchase Notes Upon a Change
of Control.

 

(a)           Upon the occurrence of a Change of
Control, each holder of the Notes will have the right to require the Companies
to repurchase all or any portion (equal to $1,000,000 or an integral multiple
of $100,000 in excess thereof) of the Notes of such holder pursuant to an offer
made in the manner described below (each, a “Change of Control Offer”), at a purchase price in cash equal to
101% of the aggregate principal amount thereof, plus accrued and unpaid
interest thereon, if any, to the date of such repurchase (the “Change of
Control Payment”). Within 10 Business Days following any Change of Control, the
Company shall deliver a notice, by facsimile confirmed the same day by
overnight courier service, to each holder of the Notes stating:

 

(i)            that the Change of Control Offer is being
made pursuant to this Section 7.2 and that all Notes tendered shall be
accepted for repurchase;

 

(ii)           the parties and the events or
circumstances giving rise to the Change of Control for which such Change of
Control Offer is being made, in reasonable detail;

 

(iii)          the repurchase price for the Note or
Notes of such holder and the Change of Control Repurchase Date therefor;

 

(iv)          that any Note not tendered for repurchase
shall continue to accrue interest in accordance with the terms thereof;

 

16

 

(v)           that, unless the Companies default in the
payment of the Change of Control Payment, all Notes accepted for repurchase pursuant
to the Change of Control Offer shall cease to accrue interest after the Change
of Control Repurchase Date; and

 

(vi)          that holders whose Notes are being
tendered for repurchase only in part shall be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered.

 

The
Companies shall comply with the requirements of Rule 14e-1 under the Exchange
Act and any other securities laws and regulations thereunder to the extent such
laws and regulations are applicable in connection with the repurchase of the
Notes as a result of a Change of Control. Any holder of the Notes that elects
to have all or a portion of its Notes repurchased as part of the Change of
Control Offer shall deliver notice to the Company of its election at least five
Business Days prior to the scheduled Change of Control Repurchase Date. Any
holder of a Note that does not deliver to the Companies notice accepting the
Change of Control Offer at least five Business Days prior to the Change of
Control Repurchase Date shall be deemed to have rejected such Change of Control
Offer. Notwithstanding the foregoing provisions of this subsection (a), the
failure of the Companies to deliver the notice referred to in the second
sentence of this subsection (a) to any holder of the Notes shall not affect or
impair the obligation of the Companies to purchase any Note from such holder on
the applicable Change of Control Repurchase Date.

 

(b)           On a date that is no earlier than 30 days nor
later than 60 days from the date that the Companies deliver or cause to be
delivered notice of the Change of Control to the holders or, if the Companies
fail to deliver such notice or cause such notice to be delivered, on the date
that is 30 days after the occurrence of such Change of Control (the “Change of
Control Repurchase Date”), the Companies (i) shall, to the extent lawful,
accept for repurchase all Notes or portions thereof properly tendered in
response to the Change of Control Offer, (ii) shall pay to each of the holders
of the Notes so accepted the Change of Control Payment for its Notes and (iii)
shall deliver to each holder of Notes that only tendered a portion of its Notes
new Notes equal in aggregate principal amount to the unpurchased portion of the
Notes surrendered, if any, by such holder.

 

(c)           Notwithstanding the foregoing, the Companies
will not be required to make a Change of Control Offer to the extent such
action is prohibited or otherwise restricted by the Senior Financing Agreement
or the Senior Subordinated Indebtedness Agreement.

 

7.3.          Offer to Repurchase Notes in Respect of
an Asset Sale.

 

(a)           In the event that, pursuant to Section
8.2(h), the Companies shall be required to commence an Asset Sale Offer, the
Companies shall make such Asset Sale Offer in the manner described in subsection (b)
of this Section 7.3.

 

(b)           Within 10 Business Days following each
date on which the Companies’ obligation to make an Asset Sale Offer is
triggered (the “Asset Sale Offer Trigger Date”), the Companies shall deliver a
notice, by facsimile confirmed the same day by overnight courier service, to
each holder of the Notes stating:

 

17

 

(i)            that the Asset Sale Offer is being made
pursuant to Section 7.3 and Section 8.2(h) and that the Companies
will purchase the aggregate principal amount of Notes required to be purchased
pursuant to Section 8.2(h) (the “Asset Sale Offer Amount”);

 

(ii)           the parties and the events or
circumstances giving rise to the Asset Sale for which such Asset Sale Offer is
being made, in reasonable detail;

 

(iii)          the repurchase price for the Note or
Notes of such holder and the Asset Sale Offer Payment Date therefor;

 

(iv)          that any Note not tendered for repurchase
shall continue to accrue interest in accordance with the terms thereof;

 

(v)           that, unless the Companies default in the
payment of the Asset Sale Offer Amount, all Notes accepted for repurchase
pursuant to the Asset Sale Offer shall cease to accrue interest after the Asset
Sale Offer Payment Date; and

 

(vi)          that holders whose Notes are being
tendered for repurchase only in part shall be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered.

 

The
Companies shall comply with the requirements of Rule 14e-1 under the Exchange
Act and any other securities laws and regulations thereunder to the extent such
laws and regulations are applicable in connection with the repurchase of the
Notes as a result of an Asset Sale. Any holder of the Notes that elects to have
all or a portion of its Notes repurchased as part of the Asset Sale Offer shall
deliver notice to the Companies of its election at least five Business Days
prior to the scheduled Asset Sale Offer Payment Date. Any holder of a Note that
does not deliver to the Companies notice accepting the Asset Sale Offer at
least five Business Days prior to the Asset Sale Offer Payment Date shall be
deemed to have rejected such Asset Sale Offer. Notwithstanding the foregoing
provisions of this subsection (b), the failure of the Companies to deliver the notice
referred to in the second sentence of this subsection (b) to any holder of the
Notes shall not affect or impair the obligation of the Companies to purchase
any Note from such holder on the applicable Asset Sale Offer Payment Date.

 

(c)           On a date that is no earlier than 30 days
nor later than 60 days from the date that the Companies deliver or cause to be
delivered notice of the Asset Sale Offer Trigger Date to the holders or, if the
Companies fail to deliver such notice or cause such notice to be delivered, on
the date that is 30 days after the occurrence of such Asset Sale Offer Trigger
Date (the “Asset Sale Offer Payment Date”), the Companies (i) shall, to the
extent lawful, accept for repurchase all Notes or portions thereof properly
tendered in response to the Asset Sale Offer, (ii) shall pay to each of the
holders of the Notes so accepted such holder’s pro  rata share of
the Asset Sale Offer Amount for its Notes and (iii) shall deliver to each
holder of Notes that only tendered a portion of its Notes new Notes equal in
aggregate principal amount to the unpurchased portion of the Notes surrendered,
if any, by such holder.

 

18

 

(d)           Notwithstanding the foregoing, the
Companies will not be required to make an Asset Sale Offer to the extent such
action is prohibited or otherwise restricted by the Senior Financing Agreement
or the Senior Subordinated Indebtedness Agreement.

 

7.4.          Allocation of Partial Prepayments. In the case of each partial prepayment
or repurchase of the Notes pursuant to Section 7.1, 7.2 or 7.3, the principal
amount of the Notes to be prepaid, repurchased or redeemed shall be allocated
(in integral multiples of $1,000) among all of the Notes at the time
outstanding in proportion, as nearly as practicable, to the respective unpaid
principal amounts thereof not theretofore called for prepayment or repurchase,
with adjustments to the extent practicable to compensate for any prior
prepayments or repurchases not made exactly in such proportion.

 

7.5.          Maturity; Surrender, Etc. In the case of each prepayment or
repurchase of the Notes pursuant to Section 7.1, 7.2 or 7.3, the principal
amount of each Note to be prepaid or repurchased shall mature and become due
and payable on the date fixed for such prepayment or repurchase, together with
accrued and unpaid interest on such principal amount to such date. From and
after such date, unless the Companies shall fail to pay such principal amount
when so due and payable, together with the accrued and unpaid interest thereon
as aforesaid, interest on such principal amount shall cease to accrue. Any Note
prepaid or repurchased in full shall be surrendered to the Companies and
cancelled and shall not be reissued, and no Note shall be issued in lieu of any
prepaid or repurchased principal amount of any Note.

 

7.6.          Purchase of Notes. The Parent will not, and will cause
Worldwide Excellerated Leasing Ltd. and its Subsidiaries not to, purchase or
otherwise acquire, directly or indirectly, any of the outstanding Notes except
upon the payment, prepayment or repurchase of the Notes in accordance with the
terms of this Agreement and the Notes. The Companies will promptly cancel all
Notes acquired by them pursuant to any payment, prepayment or purchase of Notes
in accordance with the terms of this Agreement and the Notes, and no Notes may
be issued in substitution or exchange for any such Notes.

 

8.             COVENANTS OF THE PARENT AND THE
COMPANIES.

 

8.1.          Affirmative Covenants. From the date of this Agreement and
thereafter, so long as any amount payable by the Credit Parties under this
Agreement, the Notes or any other Note Document shall remain unpaid:

 

(a)           Financial Reporting. The Parent will furnish to each
Purchaser:

 

(i)            as soon as available and in any event
within 20 days after the end of each fiscal month of Vanguard Holdings,
commencing November 30, 2003, consolidated balance sheets, consolidated
statements of operations and retained earnings and consolidated statements of
cash flows of each of (A) Vanguard Holdings and its Subsidiaries and
(B) Vanguard and its Subsidiaries as of the end of such fiscal month and
for the period commencing at the end of the immediately preceding Fiscal Year
and ending with the end of such fiscal month, setting forth in each case in
comparative form the figures for the corresponding date or period of the
immediately preceding Fiscal Year (if available), all in reasonable detail and
certified by an Authorized Officer of Vanguard Holdings as fairly

 

19

 

presenting, in all material respects, the financial
position and results of operations of such Person and its Subsidiaries as of
the end of such fiscal month and the results of operations and cash flows of
such Person and its Subsidiaries for such fiscal month, in accordance with GAAP
applied in a manner consistent with that of the most recent audited financial
statements of such Person and its Subsidiaries furnished to the Agents and the
Lenders, subject to normal year-end audit adjustments;

 

(ii)           as soon as available and in any event
within 45 days after the end of each fiscal quarter of the Parent, commencing
March 31, 2004, consolidated balance sheets, consolidated statements of
operations and retained earnings and consolidated statements of cash flows of
each of (A) the Parent and its Subsidiaries and (B) Vanguard and its
Subsidiaries as at the end of such fiscal quarter, and for the period
commencing at the end of the immediately preceding Fiscal Year and ending with
the end of such fiscal quarter, setting forth in each case in comparative form
the figures for the corresponding date or period of the immediately preceding
Fiscal Year (if available), all in reasonable detail and certified by a
Responsible Officer as fairly presenting, in all material respects, the
financial position of such Person and its Subsidiaries as of the end of such
fiscal quarter and the results of operations and cash flows of such Person and
its Subsidiaries for such fiscal quarter, in accordance with GAAP applied in a
manner consistent with that of the most recent audited financial statements of
such Person and its Subsidiaries furnished hereunder, subject to normal
year-end adjustments;

 

(iii)          as soon as available, and in any event
within 90 days after the end of each Fiscal Year of the Parent, consolidated
balance sheets, consolidated statements of operations and retained earnings and
consolidated statements of cash flows of each of (A) the Parent and its
Subsidiaries and (B) Vanguard and its Subsidiaries as at the end of such Fiscal
Year, setting forth in comparative form the corresponding figures for the
immediately preceding Fiscal Year (if available), all in reasonable detail and
prepared in accordance with GAAP, and accompanied by a report and an
unqualified opinion, prepared in accordance with generally accepted auditing
standards, of independent certified public accountants of recognized standing
selected by the Parent and reasonably satisfactory to the Agent (which opinion
shall be without (A) a “going concern” or like qualification or exception
or (B) any qualification or exception as to the scope of such audit),
together with a written statement of such accountants (1) to the effect
that, in making the examination necessary for their certification of such financial
statements, they have not obtained any knowledge of the existence of an Event
of Default or a Default and (2) if such accountants shall have obtained
any knowledge of the existence of an Event of Default or such Default,
describing the nature thereof;

 

(iv)          simultaneously with the delivery of the
financial statements required by clauses (ii) and (iii) of this
Section 8.1(a), a compliance certificate, in form and scope reasonably
acceptable to the Agent, signed on behalf of the Parent by a Responsible Officer,
stating that the Parent has caused to be taken a review of the provisions of
this Agreement and the other Note Documents and the condition and operations of
the Parent and its Subsidiaries during the period covered by such financial
statements with a view to determining whether the Parent and its Subsidiaries
were in compliance with all of the provisions of such Note Documents at the
times such compliance is required by the Note Documents, and that such review
has not disclosed the existence during such period of an Event of Default or
Default or, if

 

20

 

an Event of Default or Default existed, describing the
nature and period of existence thereof and the action that the Parent and its
Subsidiaries propose to take or have taken with respect thereto;

 

(v)           (A) on or before November 30 of each
year, commencing with the year ending December 31, 2004, the annual budget
of the Parent and its Subsidiaries for the immediately succeeding Fiscal Year
of the Parent and its Subsidiaries, as presented to and approved by the Board
of Directors of the Parent and containing financial projections prepared on a
fiscal month basis and in reasonable detail, all such financial projections to
be reasonable, to be prepared on a reasonable basis and in good faith, and to
be based on assumptions believed by the Parent to be reasonable at the time
made and from the best information then available to the Parent;

 

(vi)          promptly after submission to any
Government Authority, all documents and information furnished to such
Government Authority in connection with any investigation of the Parent or any
of its Subsidiaries other than routine inquiries by such Governmental
Authority;

 

(vii)         as soon as possible, and in any event
within three days, after the occurrence of an Event of Default or Default or
the occurrence of any event or development that could reasonably be expected to
have a Material Adverse Effect, the written statement of a Responsible Officer
setting forth the details of such Event of Default, Default, other event,
development or Material Adverse Effect and the action which the Parent and its
Subsidiaries propose to take with respect thereto;

 

(viii)        promptly after the commencement thereof
but in any event not later than five days after service of process with respect
thereto on, or the obtaining of knowledge thereof by, any Credit Party, notice
of each action, suit or proceeding before any court or other Governmental
Authority or any arbitrator which, if adversely determined, could reasonably be
expected to have a Material Adverse Effect;

 

(ix)           to the extent not otherwise required
under any other clause of this Section 8.1(a), promptly after the sending or
filing thereof, copies of all material statements, reports and other
information the Parent or any of its Subsidiaries sends to any holders of its
Indebtedness or its securities or files with the SEC or any national (domestic
or foreign) securities exchange;

 

(x)            promptly upon receipt thereof, copies of
all financial reports (including management letters), if any, submitted to any
Credit Party by its auditors in connection with any annual or interim audit of
the books thereof;

 

(xi)           as soon as possible, and in any event
within five days, after execution, receipt or delivery thereof, copies of any
material notices that any Credit Party executes or receives in connection with
the sale, transfer or any other disposition of the Capital Stock of, or all or
substantially all of the assets of, any Credit Party;

 

(xii)          promptly upon delivery or receipt by any
Credit Party, copies of all material notices delivered or received by any
Credit Party under any Document (other than a Note Document); and

 

21

 

(xiii)         promptly upon request, such other
information concerning the condition or operations, financial or otherwise, of
the Parent or any of its Subsidiaries as the Agent or the Required Holders may
from time to time may reasonably request.

 

(b)           Compliance with Laws, Etc. Each of the Parent and the Companies
will comply, and the Companies will cause each of their respective Restricted
Subsidiaries to comply, in all material respects with all applicable laws,
rules, regulations and orders (including, without limitation, ERISA and all
Environmental Laws), such compliance to include, without limitation, (i) paying
before the same become delinquent all taxes, assessments and governmental
charges or levies imposed upon it or upon its income or profits or upon any of
its properties, and (ii) paying all lawful claims which if unpaid might
become a Lien or charge upon any of its properties, except to the extent
contested in good faith by proper proceedings which stay the imposition of any
penalty, fine or Lien resulting from the non-payment thereof and with respect to
which adequate reserves have been set aside for the payment thereof in
accordance with GAAP, the noncompliance with which in each such case could
reasonably be expected to have a Material Adverse Effect.

 

(c)           Preservation of Corporate Existence, Etc.

 

(i)            Each of the Parent and the Companies will
preserve and keep in full force and effect, and the Companies will cause each
of their respective Restricted Subsidiaries to preserve and keep in full force
and effect, (A) its corporate (or other) existence and good standing in its
jurisdiction of organization and (B) all of its permits, licenses, approvals,
rights, privileges and franchises; provided, however, that
nothing in this Section 8.1(c) shall prevent any of the Companies’
Restricted Subsidiaries from terminating or failing to preserve and keep in
full force and effect any such permit, license, approval, right, privilege or
franchise if the Companies have determined in their good faith judgment that
such termination or failure to preserve could not reasonably be expected to
have a Material Adverse Effect.

 

(ii)           Each of the Parent and the Companies
will, and the Companies will cause each of their respective Restricted
Subsidiaries to, duly qualify and remain duly qualified as a foreign
corporation or other entity, and be and remain in good standing, in each
jurisdiction in which the ownership, lease or operation of its property and
assets or the conduct of its businesses requires such qualification, except in
any such jurisdiction in which the failure to be so qualified or in good
standing could not reasonably be expected to have a Material Adverse Effect.

 

(d)           Keeping of Records and Books of Account. Each of the Parent and the Companies
will keep, and the Companies will cause each of their respective Subsidiaries
to keep, proper records and books of account, with complete entries made of all
financial transactions in accordance with GAAP and applicable law.

 

(e)           Inspection Rights. Each of the Parent and the Companies
will permit the Agent or any agents or representatives thereof upon three days
prior notice during normal business hours, to examine and make copies of
abstracts from the records and books of account of such Credit Party and its
Subsidiaries; provided that no notice by the Agent or any

 

22

 

Purchaser shall be required upon the occurrence and
during the continuance of an Event of Default. The Companies agree to pay the
reasonable cost of (i) not more than two such examinations in any consecutive
twelve month period so long as no Event of Default shall have occurred and be
continuing and (ii) all such examinations if an Event of Default shall have
occurred and be continuing.

 

(f)            Maintenance of Properties, Etc. Each of the Parent and the Companies will
maintain and preserve, and the Companies will cause each of their respective
Restricted Subsidiaries to maintain and preserve, all of its properties that
are necessary or useful in the proper conduct of its business in good working
order and condition, ordinary wear and tear excepted, and comply, at all times
with the provisions of all leases to which it is a party as lessee or under
which it occupies property, so as to prevent any loss or forfeiture thereof or
thereunder.

 

(g)           Maintenance of Insurance. Each of the Parent and the Companies
will maintain, and the Companies will cause each of their respective Restricted
Subsidiaries to maintain, self insurance and insurance with responsible and
reputable insurance companies or associations (including comprehensive general
liability, casualty and business interruption insurance) with respect to its
properties (including all real properties leased or owned by them) and
business, in such amounts and covering such risks as is required by any
Governmental Authority having jurisdiction with respect thereto or as is
carried generally in accordance with sound business practice by companies in
similar businesses similarly situated.

 

(h)           Obtaining of Permits, Etc. Each of the Parent and the Companies will
obtain, maintain and preserve and take all necessary action to timely renew,
and the Companies will cause each of their respective Restricted Subsidiaries
to obtain, maintain and preserve and take all necessary action to timely renew,
all permits, licenses, authorizations, approvals, entitlements and
accreditations which are necessary in the proper conduct of its business except
to the extent that the failure to obtain, maintain, preserve or renew the same
could not reasonably be expected to have a Material Adverse Effect.

 

(i)            Environmental Matters. Each of the Parent and the Companies
will (i) keep any property either owned or operated by it or any of its
Restricted Subsidiaries free of any Environmental Liens; (ii) comply, in
all material respects with Environmental Laws; (iii) promptly provide the
Collateral Agent with written notice within 10 days of the receipt of any of
the following:  (A) notice that an
Environmental Lien has been filed against any property of any Credit Party or
any of its Restricted Subsidiaries; (B) commencement of any Environmental
Action or notice that an Environmental Action will be filed against any Credit
Party or any of its Restricted Subsidiaries; and (C) notice of a
violation, citation or other administrative order which is reasonably likely to
have a Material Adverse Effect; and (iv) defend, indemnify and hold
harmless, each of the Agent and the Purchasers and their respective
transferees, and the respective employees, agents, officers and directors
thereof, from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs or expenses (including reasonable attorney and
consultant fees, investigation and laboratory fees, court costs and litigation
expenses) arising out of (A) the presence, disposal, release or threatened
release of any Hazardous Materials on any property at any time owned or
occupied by any Credit Party or any of its Restricted Subsidiaries (or its
respective predecessors in interest or title), (B) any personal injury
(including wrongful death) or property damage (real or personal)

 

23

 

arising out of or related to such Hazardous Materials,
(C) any investigation, lawsuit brought or threatened, settlement reached
or government order relating to such Hazardous Materials, (D) any
violation of any Environmental Law by such Credit Party or any of its
Restricted Subsidiaries and/or (E) any Environmental Actions filed against the
Agent, any Purchaser or any transferee thereof or other such indemnified Person.

 

(j)            Further Assurances. Each of the Parent and the Companies
will take such action and execute, acknowledge and deliver at its sole cost and
expense, such agreements, instruments or other documents as the Agent or any
Purchaser may reasonably require from time to time in order (i) to carry
out more effectively the purposes of this Agreement and the other Note
Documents, (ii) to subject to valid and perfected fourth priority Liens
any of the Collateral, subject only to the Liens granted in favor of the Senior
Agent pursuant to the Senior Financing Documents and Liens granted in favor of
the Senior Subordinated Agent pursuant to the Senior Subordinated Financing
Documents, (iii) to establish and maintain the validity and effectiveness
of any of the Note Documents and the validity, perfection and priority of the
Liens intended to be created thereby, and (iv) to better assure, convey,
grant, assign, transfer and confirm unto the rights now or hereafter intended
to be granted to the Agent or any Purchaser under this Agreement or any other
Note Document.

 

(k)           Fiscal Periods The Parent will cause the Fiscal Years,
the fiscal quarters and the fiscal months to remain as currently in effect,
unless the Required Holders consent to a change in such Fiscal Year or other fiscal
periods.

 

(l)            Subsidiary Guaranties. The Companies shall, within 10 Business
Days after the formation or acquisition of any Restricted Subsidiary, (i) cause
such Restricted Subsidiary to execute and deliver to the Agent a Subsidiary
Guaranty and (ii) cause to be delivered to the Agent an opinion of counsel, in
form and substance reasonably satisfactory to the Agent, that such Subsidiary
Guaranty is a valid and legally binding obligation of such Subsidiary
Guarantor, provided, in each such case that a comparable guaranty is
also required to be executed and delivered pursuant to the terms of the Senior
Financing Agreement and that upon the release or termination of such comparable
guaranty, such Subsidiary Guaranty shall, so long as no Event of Default shall
have occurred and be continuing, automatically terminate.

 

(m)          Additional Collateral Security. The Companies shall, within 10 Business
Days after the formation or acquisition of any Finance Company of the Company,
execute and deliver, or cause each owner of any Capital Stock of such Finance
Company to execute and deliver a supplement to the Pledge Agreement, together
with (i) certificates evidencing all of the shares of Capital Stock of
such Finance Company or if such Capital Stock is subject to a Lien granted in
favor of the Senior Agent pursuant to the Senior Financing Agreement or a Lien
granted in favor of the Senior Subordinated Agent pursuant to the Senior
Subordinated Indebtedness Documents, copies of such certificates; provided
that (A) upon payment in full of the Indebtedness under the Senior Financing
Agreement, the original certificates shall be delivered to one of such agents,
as applicable, and (B) upon payment in full of the Senior Subordinated
Indebtedness, the original certificates shall be delivered to the Agent
together with undated stock powers executed in blank with signature guaranteed,
and such opinion of counsel and such approving certificate of such Subsidiary
as the Agent may reasonably request in respect of complying with any legend on
any such certificate or any other

 

24

 

matter relating to such shares, and (ii)  such
other agreements, instruments, approvals, legal opinions or other documents
requested by the Agent.

 

8.2.          Negative Covenants. From the date of this Agreement and
thereafter, so long as any amount payable by the Credit Parties under this
Agreement, the Notes or any other Note Document shall remain unpaid:

 

(a)           Limitation on Indebtedness.

 

(i)            Neither the Parent nor any of the
Companies will, and the Companies will not permit any of their respective
Restricted Subsidiaries to, directly or indirectly, create, issue, assume,
guarantee or otherwise become directly or indirectly liable, contingently or
otherwise, for the payment of, or otherwise incur, including by way of merger,
consolidation or acquisition (collectively, “incur”), any Indebtedness
(including Acquired Indebtedness and the issuance of Disqualified Stock),
except any of the Credit Parties and the Subsidiary Guarantors may incur
Indebtedness (including the issuance of Disqualified Stock) if, at the time of
such incurrence, the Consolidated Fixed Charge Coverage Ratio would, after
giving effect to such incurrence or issuance and the application of the
proceeds thereof, have been at least 2.0 to 1.0.

 

(ii)           Notwithstanding the foregoing, the Credit
Parties and the Subsidiary Guarantors may incur any of the following
Indebtedness (“Permitted Indebtedness”):

 

(A)          Indebtedness of the Credit Parties and
the Subsidiary Guarantors under the Note Documents;

 

(B)           Indebtedness of the Credit Parties and
their Restricted Subsidiaries under the Senior Financing Agreement in an
aggregate principal amount not to exceed $150,000,000 at any one time
outstanding;

 

(C)           Indebtedness of the Credit Parties under
the Senior Subordinated Indebtedness Documents in an aggregate principal amount
not to exceed $80,000,000 and Indebtedness of the Parent under the Junior
Holdings Subordinated Indebtedness Agreement in an aggregate principal amount
not to exceed $80,000,000 plus the amount of any interest thereon capitalized
in accordance with the terms thereof;

 

(D)          Indebtedness of the Credit Parties and
Restricted Subsidiaries outstanding on the Purchase Date and listed on Schedule
8.1(a)(ii);

 

(E)           Indebtedness of a Credit Party or a
Subsidiary Guarantor to another Credit Party or Subsidiary Guarantor so long as
such Indebtedness is held by a Credit Party or a Subsidiary Guarantor or the
holder of a Permitted Lien thereon and provided such Indebtedness owing by a
Company is subordinated in right of payment to the payment of the Obligations
pursuant to a written agreement satisfactory to the Agent;

 

(F)           Indebtedness represented by Capital Lease
Obligations, mortgage financings or purchase money obligations, in each case
incurred for the purpose of financing all or any part of the purchase price,
lease expense, cost of construction,

 

25

 

repair or improvement of or addition to property,
plant or equipment used in the business of such Credit Party or such Restricted
Subsidiary, the Capital Stock of a Restricted Subsidiary that owns such
property, plant or equipment, in an aggregate principal amount, including all
Permitted Refinancing Indebtedness incurred to refund, refinance or replace
Indebtedness incurred pursuant to this clause (F), not to exceed $30,000,000 at
any time outstanding;

 

(G)           Hedging Obligations that are incurred in
the normal course of business for the purpose of fixing or hedging currency,
commodity or interest rate risk (including with respect to any floating rate
Indebtedness that is permitted by the terms of this Agreement to be
outstanding) and not for speculative purposes;

 

(H)          the guarantee by any Credit Party or any
Restricted Subsidiary of Indebtedness of any other Credit Party or Restricted
Subsidiary that was permitted to be incurred by another provision of this
Section 8.2(a) or other obligations (including obligations under the operating
leases), permitted to be incurred hereunder of any other Credit Party or
Restricted Subsidiary of a Credit Party;

 

(I)            Contingent Obligations (including
obligations under leases, indemnification and guarantee obligations) in respect
of Indebtedness and other obligations of Unrestricted Subsidiaries incurred in
the ordinary course of business in connection with the financing of vehicles
used in Permitted Businesses of such Unrestricted Subsidiaries;

 

(J)            Indebtedness represented by guarantees or
other Contingent Obligations in favor of airports, airport authorities and
other Governmental Authorities for the construction of airport rental or
related facilities to be used by any Company or any Restricted Subsidiary in
the ordinary course of business that do not exceed in the aggregate $50,000,000
at any time outstanding;

 

(K)          Indebtedness to finance the payment of
insurance premiums and Indebtedness incurred in respect of workers’
compensation claims, self-insurance obligations, performance, surety, insurance
and similar bonds and completion guarantees provided by any Credit Party or any
Restricted Subsidiary in the ordinary course of business;

 

(L)           Indebtedness arising from agreements of
any Credit Party or any Restricted Subsidiary providing for indemnification,
adjustment of purchase price or similar obligations, in each case, incurred or
assumed in connection with the disposition of any business, assets or Capital
Stock of a Restricted Subsidiary;

 

(M)         Indebtedness arising from the honoring by
a bank or other financial institution of a check, draft or similar instrument
(except in the case of daylight overdrafts) drawn against insufficient funds in
the ordinary course of business, provided that such Indebtedness is
extinguished within five Business Days of incurrence;

 

(N)          Indebtedness of a Restricted Subsidiary
incurred and outstanding on or prior to the date on which such Person was
acquired by a Company or a Restricted Subsidiary (other than Indebtedness
incurred in connection with or in contemplation of, or to provide all or any
portion of the funds or credit support utilized to consummate, the transaction
or series of related transactions pursuant to which such Person was acquired by
a

 

26

 

Company or a Restricted Subsidiary); provided, however,
that on the date of such acquisition and after giving effect thereto, the
Companies would have been able to incur at least $1.00 of additional
Indebtedness pursuant to Section 8.2(a)(i);

 

(O)          Indebtedness incurred in connection with the
acquisition of vehicles directly from the manufacturer thereof, provided, that
such Indebtedness does not exceed the net book value of such vehicles and no
Event of Default shall exist after giving effect thereto and the use of
proceeds thereof;

 

(P)           purchase money Indebtedness of a Company or
any of its Restricted Subsidiaries incurred in connection with the purchase of
a franchisee in an aggregate amount for all Companies and their Restricted
Subsidiaries not to exceed $5,000,000 at any time outstanding;

 

(Q)          Additional Indebtedness of the Companies or
any of their Restricted Subsidiaries in an aggregate principal amount for all
Companies and their Restricted Subsidiaries not to exceed $10,000,000 at any
time outstanding; and

 

(R)           Permitted Refinancing Indebtedness;

 

provided, however, that no Permitted
Indebtedness described in clause (N) and (R) above may be incurred if after
giving effect to the incurrence of such Indebtedness and the use of the
proceeds thereof, an Event of Default shall exist.

 

(iii)          For purposes of determining compliance with
this Section 8.2(a), in the event that an item of proposed Indebtedness meets
the criteria of more than one of the categories of Permitted Indebtedness
described in clauses (A) through (R) of this Section 8.2(a) as of the date of
incurrence thereof or is entitled to be incurred pursuant to paragraph (i) of
this Section 8.2(a) as of the date of incurrence thereof, the Companies shall,
in their sole discretion, classify (or later reclassify in whole or in part, in
their sole discretion) such item of Indebtedness in any manner that complies
with this Section 8.2(a). Accrual of interest, accrual of dividends, the
accretion of accreted value and the payment of interest in the form of
additional Indebtedness and the payment of dividends on Disqualified Stock or
preferred stock in the form of additional shares of the same class of
Disqualified Stock or preferred stock will not be deemed to be an incurrence of
Indebtedness or an issuance of Disqualified Stock or preferred stock for
purposes of this covenant.

 

(iv)          For purposes of determining compliance with
any U.S. dollar-denominated restriction on the incurrence of Indebtedness
denominated in a foreign currency, the U.S. 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, provided that if such Indebtedness is incurred to refinance other
Indebtedness denominated in a foreign currency, and such refinancing would
cause the applicable U.S. dollar-denominated restriction to be exceeded if
calculated at the relevant currency exchange in effect on the date of such
refinancing, such U.S. dollar-denominated restriction shall be deemed not to
have been exceeded so long as the principal amount of such

 

27

 

refinancing
Indebtedness does not exceed the principal amount of such Indebtedness being
refinanced.

 

(b)           Limitation on Restricted Payments.

 

(i)            Neither the Parent nor any of the
Companies will, and the Companies will not permit any of their respective
Restricted Subsidiaries to, directly or indirectly:

 

(A)          declare or pay any dividend on, or make
any distribution to holders of, any shares of the Capital Stock of the Parent
or any Company or any Restricted Subsidiary, other than such dividends or
distributions that are payable to the Parent or a Company or payable in Capital
Stock (other than Disqualified Stock) of the Parent or a Company;

 

(B)           purchase, redeem or otherwise acquire or
retire for value, directly or indirectly, any shares of Capital Stock (or any
options, warrants or other rights to acquire shares of Capital Stock) of the
Parent or any Company;

 

(C)           make any principal payment on, or
repurchase, redeem, defease or otherwise acquire or retire for value, prior to
any scheduled principal payment, sinking fund payment or maturity, any
Indebtedness that is subordinated in right of payment to the Notes; or

 

(D)          make any Investment (other than a
Permitted Investment) in any Person;

 

(such
payments or other actions described in (but not excluded from) clauses (A)
through (D) being referred to as “Restricted Payments”); unless:

 

(1)           no Default or Event of Default has occurred
and is continuing or would otherwise occur as a consequence thereof;

 

(2)           the Companies could incur at least $1.00 of
additional Indebtedness pursuant to subsection (i) of Section 8.2(a); and

 

(3)           the aggregate amount of all Restricted
Payments (including such Restricted Payment) declared or made after the
Purchase Date does not exceed the sum of (without duplication).

 

(w)          50% of Consolidated Adjusted Net Income,
determined on a cumulative basis for the applicable Reference Period (or, if
such aggregate cumulative Consolidated Adjusted Net Income is a loss, minus
100% of such amount); plus

 

(x)            the aggregate net cash proceeds received by
the Parent and its Restricted Subsidiaries after the Purchase Date from the
issuance or sale (other than to a Subsidiary of the Parent) of Qualified

 

28

 

Equity
Interests of the Parent, or any other equity contributions received by the
Parent or any of its Restricted Subsidiaries after the Purchase Date (excluding
any such proceeds used to redeem Notes); plus

 

(y)           the aggregate net cash proceeds received by
the Parent and its Restricted Subsidiaries after the Purchase Date from the
issuance or sale (other than to a Subsidiary of the Parent) of debt securities
or Disqualified Stock that have been converted into or exchanged for Qualified
Stock of the Parent, together with the aggregate net cash proceeds received by
the Parent at the time of such conversion or exchange; plus

 

(z)            the sum of (I) without duplication of any
amounts included in Consolidated Adjusted Net Income in clause (w) above, the
aggregate amount paid in cash or Cash Equivalents to any Company or a
Restricted Subsidiary on or with respect to Investments (other than Permitted
Investments) made subsequent to the Purchase Date whether through interest
payments, principal payments, dividends or other distributions or payments,
(II) the net cash proceeds received by any Company or any Restricted Subsidiary
from the disposition of all or any portion of such Investments (other than to a
Restricted Subsidiary) and (III) upon redesignation of an Unrestricted
Subsidiary as a Restricted Subsidiary, the Fair Market Value of such
Subsidiary; provided, however, that the sum of clauses (I), (II)
and (III) above shall not exceed the aggregate amount of all such Investments
made subsequent to the Purchase Date.

 

(ii)           Notwithstanding the provisions of Section
8.2(b)(i), any of the Credit Parties and the Restricted Subsidiaries may take
any of the following actions:

 

(A)          the payment of any dividend within 60
days after the date of declaration thereof, if at the declaration date such
payment would not have been prohibited by the foregoing provisions;

 

(B)           the repurchase, redemption or other
acquisition or retirement for value of any shares of Capital Stock of the
Parent or Vanguard, in exchange for, or out of the net cash proceeds of, a
substantially concurrent issuance and sale (other than to a Subsidiary of the
Parent) of, Qualified Equity Interests of the Parent or Vanguard;

 

(C)           the purchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Indebtedness in exchange
for, or out of the net cash proceeds of, a substantially concurrent issuance
and sale (other than to a Subsidiary of the Parent) of Qualified Equity
Interests of the Parent or Vanguard;

 

(D)          the purchase, redemption, defeasance or
other acquisition or retirement for value of Subordinated Indebtedness in
exchange for, or out of the

 

29

 

net cash proceeds of, a substantially concurrent
issuance or sale (other than to a Subsidiary of the Parent) of, Permitted
Refinancing Indebtedness;

 

(E)           the repurchase of any Subordinated
Indebtedness at a purchase price not greater than 101% of the principal amount
of such Subordinated Indebtedness in the event of a “change of control” in
accordance with provisions similar to Section 7.2; provided that,
prior to such repurchase, the Parent has made the Change of Control Offer as
provided in such Section with respect to the Notes and has repurchased all
Notes validly tendered for payment in connection with such Change of Control
Offer;

 

(F)           Restricted Payments for the purchase,
redemption, acquisition, cancellation or other retirement for value of shares
of Capital Stock of the Parent; provided that the aggregate cash
consideration paid for such purchase, redemption, acquisition, cancellation or
other retirement of such shares of Capital Stock after the Purchase Date does
not exceed $50,000 in any Fiscal Year;

 

(G)           dividends by the Companies to the Parent
or by the Parent to Worldwide in amounts necessary to pay (A) customary
administrative expenses (including reasonable directors’ fees) of the Parent
and Worldwide in the ordinary course of their respective businesses and in an
aggregate amount not to exceed in any Fiscal Year $2,500,000, and taxes when
due and owing by the Parent or Worldwide; and

 

(H)          repurchases in whole or in part by
Vanguard of outstanding shares of its Series A Preferred Stock;

 

so
long as, in the case of any Restricted Payment described in clause (D) or (H),
no Default or Event of Default shall exist immediately after giving effect to
such Restricted Payment.

 

The
payments described in clauses (B) (as to the proceeds of an issuance and sale
of Qualified Equity Interests), (C), (E), (F), (G) and (H) of this paragraph
will be Restricted Payments that will be permitted to be taken in accordance
with this paragraph but will reduce the amount that would otherwise be
available for Restricted Payments under clause (3)(z) of Section 8.2 (b)(i) and
the payments described in clauses (A), (B) (except as provided above) and
(D) of this paragraph will be Restricted Payments that will be permitted to be
taken in accordance with this paragraph and will not reduce the amount that
would otherwise be available for Restricted Payments under the clause (3)(z) of
Section 8.2(b)(i).

 

(iii)          For the purpose of making any
calculations under this Agreement (A) if a Restricted Subsidiary is
designated an Unrestricted Subsidiary, the Parent will be deemed to have made
an Investment in amount equal to the Fair Market Value of the net assets of
such Restricted Subsidiary at the time of such designation, (B) any
property transferred to or from an Unrestricted Subsidiary will be valued at
Fair Market Value at the time of such transfer, and (C) subject to the
foregoing, the amount of any Restricted Payment, if other than cash, will be
determined by the Board of Directors of the Parent, whose good faith
determination will be conclusive.

 

(c)           Limitation on Dividends and Other Payment
Restrictions Affecting Restricted Subsidiaries. Neither the Parent nor any of the Companies will,
and the Companies

 

30

 

will not permit any of their respective Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of any Restricted Subsidiary of any of the Companies to
(i) pay dividends, in cash or otherwise, or make any other distributions
on or in respect of its Capital Stock, (ii) pay any Indebtedness owed to
any Credit Party or Restricted Subsidiary, (iii) make loans or advances to
any Credit Party or Restricted Subsidiary or (iv) transfer any of its
properties or assets to any Credit Party or Restricted Subsidiary except for
such encumbrances or restrictions existing under or by reason of any of the
following:

 

(A)          the Documents and any other agreement in
effect on the Purchase Date and any amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings
thereof, provided that such amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings are no more restrictive,
taken as a whole, with respect to dividend and other payment restrictions than
those contained in such agreements as in effect on the Purchase Date;

 

(B)           in the case of clause (iv) above, (1)
agreements or instruments that restrict in a customary manner the subletting,
assignment or transfer of any property or asset that is a lease, license,
conveyance or contract or similar property or asset, (2) any transfer of,
agreement to transfer, option or right with respect to, or Lien on, any
property or assets of any Company or any Restricted Subsidiary not otherwise
prohibited by this Indenture or (C) provisions arising or agreed to in the
ordinary course of business not relating to Indebtedness that do not,
individually or in the aggregate, detract from the value of property or assets
of any Company or any of its Restricted Subsidiaries or the ability of the
Company or such Restricted Subsidiary, as the case may be, to use such property
or assets, in each case in any manner material to such Company or any of its
Restricted Subsidiaries;

 

(C)           any agreement or instrument governing
Acquired Indebtedness, which encumbrance or restriction is not applicable to
any Person, or the properties or assets of any Person, other than the Person or
the properties or assets of the Person so acquired;

 

(D)          provisions in agreements or instruments that
prohibit the payment of dividends or the making of other distributions with
respect to any Capital Stock of a Person other than on a pro rata basis;

 

(E)           restrictions on the transfer of assets
subject to any Permitted Lien imposed by the holder of such Lien;

 

(F)           restrictions imposed by any agreement to sell
assets or Capital Stock permitted under this Agreement to any Person pending
the closing of such sale;

 

(G)           provisions in joint venture agreements and
other similar agreements (in each case relating solely to the respective joint
venture or similar entity or the equity interests therein) entered into in the
ordinary course of business;

 

31

 

(H)          restrictions contained in the terms of the
purchase money Indebtedness or Capitalized Lease Obligations not incurred in
violation of this Indenture; provided, that such restrictions
relate only to the property financed with such Indebtedness;

 

(I)            restrictions contained in the terms of
Indebtedness incurred in compliance with Section 8.2(a); provided that such
restrictions, taken as a whole, are, in the good faith judgment of the Parent’s
Board of Directors, no more materially restrictive with respect to such
encumbrances and restrictions than those contained in the existing agreements
referenced in clause (A) above;

 

(J)            restrictions on cash or other deposits
imposed by customers under contracts or other arrangements entered into or
agreed to in the ordinary course of business;

 

(K)          an agreement governing Permitted Refinancing
Indebtedness incurred to Refinance the Indebtedness issued, assumed or incurred
pursuant to an agreement referred to in clause (A) or (C) above; provided,
however, that the provisions relating to such encumbrance or restriction
contained in any such Indebtedness are no less favorable to any Company or
Restricted Subsidiary in any material respect as determined by the Board of
Directors of the Parent in its reasonable and good faith judgment than the
provisions relating to such encumbrance or restriction contained in agreements
referred to in such clause (A) or (C).

 

(d)           Limitation on Issuances and Sales of
Capital Stock of Restricted Subsidiaries. Neither the Parent nor any Company will, directly or
indirectly, sell, and the Companies will not permit any of their respective
Restricted Subsidiaries to issue or sell, any shares of the Capital Stock of
any Restricted Subsidiary or any options, warrants or other rights to purchase
shares of such Capital Stock except (i) to the Parent or any Company, or
(ii) if, immediately after giving effect to such issuance or sale,
(A) neither the Parent nor any of its Restricted Subsidiaries owns any
shares of Capital Stock of such Company or Subsidiary or any options, warrants
or other rights to purchase shares of such Capital Stock and (B) such
issuance or sale is made in compliance with this Agreement.

 

(e)           Limitation on Other Subordinated
Indebtedness.
Except for the Senior Subordinated Indebtedness, neither the Parent nor any of
the Companies will incur or otherwise permit to exist, and the Companies will
not permit any of their respective Restricted Subsidiaries to incur or
otherwise permit to exist, any Indebtedness that is subordinate in right of
payment to any of its senior Indebtedness unless such Indebtedness is also
subordinate in right of payment to the Notes or its Subsidiary Guaranty, as the
case may be, to at least the same extent as the Notes or such Subsidiary
Guaranty are subordinate in right of payment to such senior Indebtedness of
such Credit Party or such Restricted Subsidiary, as the case may be, as set
forth in the applicable Intercreditor Agreement.

 

(f)            Limitation on Liens. Neither the Parent nor any of the
Companies will create, incur or otherwise permit to exist, and the Companies
will not permit any of their respective Restricted Subsidiaries to create,
incur or otherwise permit to exist, any Lien of any kind (other than Permitted
Liens) upon any property or assets (including any intercompany notes) of such
Credit Party or such Restricted Subsidiary, or any income or profits therefrom,

 

32

 

unless the Notes or Subsidiary Guaranty, as the case
may be, are directly secured equally and ratably with (or prior to in the case
of Subordinated Indebtedness) the obligation or liability secured by such Lien.

 

(g)           Limitation on Transactions with
Affiliates.

 

(i)            Neither the Parent nor any of the
Companies will, and the Companies will not permit any of their respective
Restricted Subsidiaries to, directly or indirectly, enter into or suffer to
exist any contract, agreement, arrangement or transaction with, or for the
benefit of, any of its Affiliates (an “Affiliate Transaction”) unless
(i) the Parent’s Board of Directors determines that such Affiliate
Transaction is on terms that are fair and reasonable to such Credit Party or
such Restricted Subsidiary, as the case may be, and are no less favorable to
such Credit Party or such Restricted Subsidiary, as the case may be, than those
that could have been obtained in an arm’s length transaction with third parties
who are not Affiliates, and (ii) with respect to any Affiliate Transaction
involving aggregate payments in excess of $5,000,000, the Parent delivers an
officers’ certificate to the Agent certifying that such Affiliate Transaction
complies with clause (i) above and has been approved by the Board of
Directors of the Parent.

 

(ii)           The restrictions set forth in Section
8.2(g)(i) shall not apply to:

 

(A)          reasonable fees and compensation paid to
and indemnity provided on behalf of officers, directors, employees or
consultants of the Parent or any of its Restricted Subsidiaries as determined
in good faith by the Parent’s Board of Directors or senior management;

 

(B)           transactions exclusively between or among
the Parent and any of its Restricted Subsidiaries or exclusively between or
among such Restricted Subsidiaries;

 

(C)           any agreement as in effect as of the
Purchase Date or any amendment thereto or any transaction contemplated thereby
(including pursuant to any amendment thereto and any extension of the maturity
thereof) and any replacement agreement thereto so long as any such amendment or
replacement agreement is not materially more disadvantageous to the holders of
the Notes, in any material respect than the original agreement as in effect on
the Purchase Date;

 

(D)          Restricted Payments permitted by this
Agreement;

 

(E)           any employment, stock option, stock
repurchase, employee benefit compensation, business expense reimbursement,
severance, termination or other employment-related agreements, arrangements or
plans entered into by the Parent or any of its Restricted Subsidiaries in the
ordinary course of business;

 

(F)           transactions relating to the issuance of
Qualified Capital Stock of, or any other equity investment in, any Credit
Party, including the granting of registration rights with respect thereto;

 

33

 

(G)           Permitted Investments; and

 

(H)          any transaction on arm’s-length terms
with a non-Affiliate that becomes an Affiliate as a result of such transaction.

 

(h)           Limitation on Certain Asset Sales.

 

(i)            Neither the Parent nor any of the
Companies will, and the Companies will not permit any of their respective
Restricted Subsidiaries to, directly or indirectly, consummate any Asset Sale,
unless:  (A) the consideration
received by the applicable Credit Party or Restricted Subsidiary with respect
to such Asset Sale is at least equal to the Fair Market Value of the assets or
Capital Stock issued or sold or otherwise disposed of; and (B) the
consideration received by the applicable Credit Party or Restricted Subsidiary
with respect to such Asset Sale consists of at least 75% (1) cash and/or Cash
Equivalents or Qualified Consideration received at the time of disposition,
(2) any liabilities, other than Subordinated Indebtedness, of the
applicable Credit Party or Restricted Subsidiary that are assumed by the
transferee of any such assets pursuant to an agreement that immediately
releases such Credit Party or Restricted Subsidiary from all liability in
respect thereof; or (3) securities, notes or other obligations received by
such Credit Party or Restricted Subsidiary from such transferee that are converted
by such Credit Party or Restricted Subsidiary into cash and/or Cash Equivalents
or Qualified Consideration within 90 days of the date of such Asset Sale
(to the extent of the cash and/or Cash Equivalents or Qualified Consideration
received).

 

(ii)           In the event of any such Asset Sale the
Companies may, at their option, within 360 days following the receipt of the
Net Cash Proceeds from such Asset Sale, (A) apply all or a portion of such
Net Cash Proceeds to the permanent reduction of amounts outstanding under the
Senior Financing Agreement or to the repayment of other senior Indebtedness of
the Companies or their respective Restricted Subsidiaries or the Senior
Subordinated Indebtedness, (which, in the case of a revolver or similar
arrangement, also permanently reduces the commitment under such facility by the
same amount) or (B) invest (or enter into a legally binding agreement to
invest) all or a portion of such Net Cash Proceeds in properties and assets to
replace the properties and assets that were the subject of the Asset Sale or in
properties and assets that will be used in businesses of the Companies as
permitted hereunder or (C) a combination of the foregoing clauses (A) and (B).
The amount of such Net Cash Proceeds not so used as set forth in this subsection
(ii) constitutes “Excess Proceeds”.

 

(iii)          When the aggregate amount of Excess
Proceeds equals or exceeds $10 million, the Companies, in accordance with
Section 7.3, shall make an offer (an “Asset Sale Offer”) to all holders of
Notes, to purchase, on a pro  rata basis, the maximum principal
amount of Notes that may be purchased out of the Excess Proceeds, at a purchase
price in cash in an amount equal to 100% of the aggregate principal amount of
the Notes, plus accrued and unpaid interest thereon to the date of purchase
(subject to the right of holders of Notes as of the relevant record date to
receive interest due on the relevant interest payment date). To the extent that
any Excess Proceeds remain after consummation of an Asset Sale Offer, the Companies
may use such Excess Proceeds for any purpose not otherwise prohibited by this
Agreement. If the aggregate principal amount of Notes tendered into such Asset
Sale Offer surrendered by holders thereof exceeds the amount of Excess
Proceeds, the Agent shall select the

 

34

 

Notes to be purchased or retired on a pro  rata
basis in proportion to the respective principal amounts of the Notes. Upon
completion of such Asset Sale Offer, the amount of Excess Proceeds shall be
reset at zero for purposes of the first sentence of this subsection.

 

(i)            Limitation on Unrestricted Subsidiaries.

 

(i)            The Board of Directors of the Parent may
designate any of its Subsidiaries (including any newly acquired or newly formed
Subsidiary) to be an Unrestricted Subsidiary so long as (i) neither the Parent
nor any Restricted Subsidiary is directly or indirectly liable for any
Indebtedness of such Subsidiary, (ii) no default with respect to any
Indebtedness of such Subsidiary would permit (upon notice, lapse of time or
otherwise) any holder of any other Indebtedness of the Parent or any Restricted
Subsidiary to declare a default on such other Indebtedness or cause the payment
thereof to be accelerated or payable prior to its stated maturity,
(iii) any Investment in such Subsidiary made as a result of designating
such Subsidiary an Unrestricted Subsidiary will not violate the provisions of
Section 8.2(b) and (iv) no Credit Party or Restricted Subsidiary has
any obligation to subscribe for additional shares of Capital Stock or other
equity interests in such Subsidiary, or to maintain or preserve such
Subsidiary’s financial condition or to cause such Subsidiary to achieve certain
levels of operating results.

 

(ii)           The Board of Directors of the Parent may
designate any Unrestricted Subsidiary as a Restricted Subsidiary; provided
that such designation will be deemed to be an incurrence of Indebtedness by
such Restricted Subsidiary of any outstanding Indebtedness of such Unrestricted
Subsidiary and such designation will only be permitted if (x) such
Indebtedness is permitted under Section 8.2(a) and (y) no Default or
Event of Default will have occurred and be continuing following such
designation.

 

(j)            Consolidation, Merger and Sale of Assets. Neither the Parent nor any of the
Companies will consolidate with or merge with or into any other Person or,
directly or indirectly, convey, transfer or lease its properties and assets
substantially as an entirety to any Person or Persons (in one transaction or a
series of related transactions), unless each of the following conditions is
satisfied:

 

(i)            either (A) the Parent or such Company, as
such case may be, is the surviving corporation or (B) the Person (if other than
the Parent or such Company, as the case may be) formed by such consolidation or
into which the Parent or such Company is merged or the Person that acquires by
sale, assignment, transfer, lease or other disposition of the properties and
assets of the Parent or such Company, as the case may be, substantially as an
entirety (the “Surviving Entity”) (1) is a corporation, partnership or trust
organized and validly existing under the laws of the United States, any state
thereof or the District of Columbia and (2) expressly assumes by
supplemental agreement all of such Credit Party’s obligations under this
Agreement and the other Note Documents;

 

(ii)           immediately after giving effect to such
transaction and treating any obligation of the Parent or such Company in
connection with or as a result of such transaction as having been incurred at
the time of such transaction, no Default or Event of Default has occurred and
is continuing;

 

35

 

(iii)          immediately after giving effect to such
transaction on a pro  forma basis, such Credit Party (or the
Surviving Entity if such Credit Party is not a continuing obligor under this
Agreement) has a Consolidated Net Worth equal to or greater than the
Consolidated Net Worth of such Credit Party, immediately prior to the closing
of such transaction;

 

(iv)          if any of the property or assets of such
Credit Party or such Surviving Entity if such Credit Party is not a continuing
obligor under this Agreement would thereupon become subject to any Lien, the
provisions of Section 8.2(f) are complied with; and

 

(v)           the Parent delivers, or causes to be
delivered, to the Agent, in form and substance reasonably satisfactory to the
Agent, an officers’ certificate and an opinion of counsel, each stating that
such transaction complies with the requirements of this Agreement.

 

In
the event of any transaction described in and complying with the conditions of
this Section 8.2(j) in which a Credit Party is not a continuing obligor
under this Agreement, the Surviving Entity will succeed to, and be substituted
for, and may exercise every right and power of, such Credit Party under this
Agreement and the other Note Documents and thereafter such Credit Party will,
except in the case of a lease, be discharged from all its obligations and
covenants under this Agreement and the other Note Documents.

 

(k)           Limitation on Business Activities. None of the Parent and the Companies
will, and the Companies will not permit any of their Restricted Subsidiaries
to, engage in any business other than a Permitted Business.

 

9.             EVENTS OF DEFAULT.

 

9.1.          Events of Default. An “Event of Default” shall exist if
any of the following conditions or events shall occur and be continuing (each,
an “Event of Default”):

 

(a)           the Companies default in the payment of
any principal of or premium, if any, on, any Note when the same becomes due and
payable, whether by scheduled maturity or at a date fixed for prepayment or
repurchase or by declaration, demand or otherwise; or

 

(b)           the Companies default in the payment of
any interest on any Note or any other amount (other than principal of or any
premium on the Notes) when the same becomes due and payable, and such default
continues for a period of at least 10 consecutive days; or

 

(c)           any Credit Party defaults in the
performance of or compliance with any term, covenant or agreement contained in
Section 7.2, 7.3, 7.4 or 8.2, or

 

(d)           any Credit Party defaults in the
performance of or compliance with any term, covenant or agreement contained in
Section 8.1(a), 8.1(c), 8.1(e), 8.1(g), 8.1(j), 8.1(l) or 8.1(m), and such
default shall remain unremedied for at least 10 consecutive days after the
earlier of the first date on which (i) a Responsible Officer becomes aware of
such default and (ii)

 

36

 

the Companies receive notice of such default from the
holders of at least 25% of the aggregate outstanding principal of the Notes; or

 

(e)           any Credit Party defaults in the
performance of or compliance with any term, covenant or agreement contained in
any Note Document on its part to be performed or complied with that is not
referred to in Section 9.1(a), 9.1(b), 9.1(c) or 9.1(d), and such default
shall remain unremedied for at least 30 consecutive days after the Companies
receive notice of such default from the holders of at least 25% of the
aggregate outstanding principal of the Notes; or

 

(f)            any representation or warranty made or
deemed made on the Purchase Date by or on behalf of any Credit Party under or
pursuant to the terms of this Agreement or any of the other Note Documents or
in any writing furnished to the Agent or any Purchaser pursuant to the terms of
this Agreement or any of the other Note Documents proves to have been false or
incorrect in any material respect on the date as of which it was made or deemed
to have been made; or

 

(g)           (i) any Credit Party or any Restricted
Subsidiary shall fail to pay (A) any principal of, or premium or interest
on, Indebtedness that is outstanding in a principal amount of at least
$10,000,000 (but excluding Indebtedness outstanding under the Note Documents),
of such Person, when the same becomes due and payable (whether by scheduled
maturity, required prepayment, redemption or repurchase, acceleration, demand
or otherwise), and such failure shall continue after the applicable grace
period, if any, specified in any agreement or instrument relating to such
Indebtedness, or (B) any other amount of Indebtedness greater than
$10,000,000 (but excluding Indebtedness outstanding under the Note Documents),
of such Person when the same becomes due and payable (whether by scheduled
maturity, required prepayment, redemption or repurchase, acceleration, demand
or otherwise), and such failure shall continue after the applicable grace
period, if any, specified in any agreement or instrument relating to such
Indebtedness; or (ii) any other event shall occur or condition shall exist
under any agreement or instrument, evidencing, securing or otherwise relating
to any Indebtedness referred to in clause (i) of this Section 9.1(g)
and shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is to
accelerate the maturity of such Indebtedness or otherwise to cause such
Indebtedness to mature; or (iii) any Indebtedness referred to in
clause (i) of this Section 9.1(g) shall be declared to be due and
payable or required to be prepaid, redeemed or repurchased (other than by a
regularly scheduled required prepayment or redemption), purchased or defeased,
or an offer to prepay, redeem, repurchase, purchase or defease any such
Indebtedness shall be required to be made, in each case prior to the stated
maturity thereof or any date fixed for prepayment, redemption or repurchase
thereunder; or

 

(h)           any Credit Party or any Restricted
Subsidiary that is a Significant Subsidiary shall generally not pay its debts
as such debts become due, or shall admit in writing its inability to pay its
debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against any Credit Party
or any Restricted Subsidiary that is a Significant Subsidiary, seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization

 

37

 

or relief of debtors, or seeking the entry of an order
for relief or the appointment of a receiver, trustee or other similar official
for it or for any substantial part of its property and assets and, in the case
of any such proceeding instituted against it (but not instituted by it) that is
being diligently contested by it in good faith, either such proceeding shall
remain undismissed or unstayed for a period of 60 consecutive days or any of
the actions sought in such proceeding (including, without limitation, the entry
of an order for relief against, or the appointment of a receiver, trustee, custodian
or other similar official for, it or any substantial part of its property and
assets) shall occur; or any Credit Party or any Restricted Subsidiary that is a
Significant Subsidiary, shall take any action to authorize any of the actions
set forth above in this subsection (h); or

 

(i)            one or more judgments, orders or decrees
for the payment of money aggregating $10,000,000 (net of applicable insurance
coverage, including self insurance provided pursuant to the Parent’s self
insurance programs as presented to and approved by the Parent’s Board of
Directors) or more are rendered against one or more of the Credit Parties and
the Restricted Subsidiaries or any of their respective properties and remain
unsatisfied and either (i) such judgment, order or decree has not been
discharged or (ii) there shall be a period of at least 60 consecutive days
after entry thereof during which a stay of enforcement of any such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or

 

(j)            any provision of any of the Note
Documents after delivery thereof shall for any reason (other than pursuant to
the express terms thereof) cease to be valid and binding on or enforceable
against any Credit Party or Subsidiary Guarantor intended to be a party to it
or shall cease to give the Agent or any of the Purchasers any of the rights,
powers or privileges purported to be created thereunder, or any Credit Party
shall so state in writing; or

 

(k)           except with respect to Collateral that
has been transferred or sold or the Lien thereon released as permitted under
any Note Document, the Pledge Agreement shall cease to be effective in all
material respects to grant in favor of the Agent the Liens with the priority
purported to be created thereby on a material portion of the Collateral
thereunder, subject only to such Liens as are expressly permitted by the Pledge
Agreement, in each case for 30 days after the Companies receive written
notice thereof specifying such occurrence from the Agent or the holders of at
least 25% of the outstanding principal amount at maturity of the Notes; or any
Credit Party or Restricted Subsidiary shall assert in writing that any Lien
created under the Pledge Agreement is invalid or unenforceable.

 

9.2.          Acceleration.

 

(a)           If an Event of Default described in
Section 9.1(h) shall occur with respect to any Company, all of the Notes then
outstanding shall become automatically and immediately due and payable.

 

(b)           If any other Event of Default shall occur
and be continuing, the Agent may, with the consent of the Required Holders, and
shall, upon the request of the Required Holders, by notice or notices to the
Companies, declare all of the Notes then outstanding to be immediately due and
payable.

 

38

 

(c)           Upon any Note becoming due and payable
under this Section 9.2, whether automatically or by declaration, such Note will
forthwith mature and the entire unpaid principal amount of such Note, plus
all accrued and unpaid interest thereon and all other amounts due and payable
to the holder thereof under the Note Documents, shall be immediately due and
payable, in each and every case without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Companies.

 

9.3.          Other Remedies. If one or more Defaults or Events of
Default shall occur and be continuing, and irrespective of whether any of the
Notes have become or have been declared immediately due and payable under
Section 9.2, the Agent and the Required Holders may proceed to protect and
enforce any and all of their rights under the Note Documents and may enforce
their rights as holders of Notes by an action at law, suit in equity or other
appropriate proceeding, whether for the specific performance of any agreement
contained herein or in any of the other Note Documents, or for an injunction
against a violation of any of the terms hereof or thereof, or in aid of the
exercise of any power granted hereby or thereby or by applicable law or
otherwise.

 

9.4.          Rescission. At any time after any Notes have been declared due
and payable pursuant to Section 9.2(b) the Required Holders, by notice to the
Companies, may rescind and annul any such declaration and its consequences if
(a) the Companies have paid all overdue interest on the Notes, all principal
of, and premium, if any, on the Notes that are due and payable and are unpaid
other than by reason of such declaration, and all interest on such overdue
principal and (to the fullest extent permitted by applicable law) any overdue
interest in respect of the Notes, at the Default Rate, (b) all Defaults and
Events of Default, other than nonpayment of amounts that have become due solely
by reason of such declaration, have been remedied or have been waived pursuant
to Section 14 and (c) no judgment or decree has been entered for the payment of
any monies due pursuant to the Notes or any of the other Note Documents. No
rescission and annulment under this Section 9.4 will extend to or affect any
subsequent Default or Event of Default or impair any right, power or remedy
consequent thereon.

 

9.5.          Restoration of Rights and Remedies. If any holder of the Notes has
instituted any proceeding to enforce any right or remedy under this Agreement
or any of the other Note Documents and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such holder,
then, and in each such case, the Companies and the holders of Notes shall,
subject to any determination in such proceeding, be restored severally to their
respective former positions hereunder and under the other Note Documents and,
thereafter, all rights and remedies of the holders of the Notes shall continue
as though no such proceeding had been instituted.

 

9.6.          No Waivers or Election of Remedies, Etc. No course of dealing and no delay on the
part of any holder of the Notes in exercising any right, power or remedy shall
operate as a waiver thereof or otherwise prejudice such holder’s rights, powers
or remedies. No right, power or remedy conferred by this Agreement or any of
the other Note Documents upon any holder of the Notes shall be exclusive of any
other right, power or remedy referred to herein or therein or now or hereafter
available at law, in equity, by statute or otherwise.

 

39

 

10.                                 REGISTRATION; EXCHANGE; SUBSTITUTION OF
NOTES.

 

10.1.        Registration of Notes. The
Companies shall keep at their principal executive office a register for the
registration and registration of transfers of Notes. The name and address of
each holder of one or more Notes, each transfer thereof and the name and
address of each transferee of one or more Notes shall be registered in such
register. Prior to due presentment for registration of transfer, the Person in
whose name any Note shall be registered shall be deemed and treated as the
owner and holder thereof for all purposes of this Agreement and the other Notes
Documents, and the Companies shall not be affected by any notice or knowledge
to the contrary. The Companies shall give to any holder of the Notes that is an
Institutional Investor, promptly upon request therefor, a complete and correct
copy of the names and addresses of all registered holders of Notes.

 

10.2.        Transfer and Exchange of Notes.

 

(a)           Upon surrender of any Note at the
principal executive office of the Companies for registration of transfer or
exchange (and, in the case of a surrender for registration of transfer, duly
endorsed or accompanied by a written instrument of transfer duly executed by
the registered holder of such Note or its attorney duly authorized in writing
and accompanied by the address for notices of each transferee of such Note or
part thereof), the Companies shall execute and deliver, at the Companies’
expense (except as provided below), one or more new Notes (as requested by the
holder thereof) in exchange therefor, in an aggregate principal amount equal to
the unpaid principal amount of the surrendered Note. Each such new Note shall
be payable to such Person as such holder may request and, subject to subsection
(c) of this Section 10.2, shall be in substantially the form of Exhibit A
attached hereto. Each such new Note shall be dated and bear interest from the
date to which interest shall have been paid on the surrendered Note or dated
the date of the surrendered Note if no interest shall have been paid thereon.
The Companies may require payment of a sum sufficient to cover any stamp tax or
other governmental charge imposed in respect of any such transfer of Notes.
Notes shall not be transferred in denominations of less than $1,000, provided
that, if necessary to enable the registration of transfer by a holder of its
entire holding of Notes, one Note may be in a denomination of less than $1,000.

 

(b)           Any transferee, by its acceptance of
a Note registered in its name (or the name of its nominee), shall be deemed (i)
to have made the representations set forth in Sections 6.1 and 6.2 and (ii) to
confirm to and agree with the transferor and the other parties hereto as
follows:

 

(A)          other than as provided in any written
instrument of transfer executed by the transferor and such transferee, such
transferor makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with this Agreement or any of the other Note Documents, or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of, or the perfection or priority of any lien or security interest
created or purported to be created under or in connection with, this Agreement
or any of the other Note Documents or any other instrument or document
furnished pursuant hereto or thereto;

 

40

 

(B)           such transferor makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Companies or any of their Subsidiaries or the
performance or observance by the Companies or any of their Subsidiaries of any
of its Obligations under this Agreement or any of the other Note Documents or any
other instrument or document furnished pursuant thereto;

 

(C)           such transferee confirms that it has
received a copy of this Agreement and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to purchase
the Note or Notes being purchased thereby;

 

(D)          such transferee will, independently
and without reliance upon the transferor or any other holder of the Notes and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement; and

 

(E)           such transferee agrees that it will
perform in accordance with their terms all of the obligations which by the
terms of this Agreement are required to be performed by it as a holder of the
Notes.

 

10.3.        Replacement of Notes. Upon
receipt by the Companies of evidence reasonably satisfactory to it of the
ownership and the loss, theft, destruction or mutilation of any Note (which
evidence shall be, in the case of an Institutional Investor, notice from such
Institutional Investor of such ownership and such loss, theft, destruction or
mutilation), and

 

(a)           in the case of loss, theft or
destruction, of indemnity reasonably satisfactory to it; provided that,
if the holder of such Note is an original purchaser of any of the Notes or any
other Institutional Investor, such Person’s own unsecured agreement of
indemnity shall be deemed to be satisfactory, or

 

(b)           in the case of mutilation, upon
surrender and cancellation thereof, the Companies, at their own expense, shall
execute and deliver, in lieu thereof, a new Note, dated and bearing interest
from the date to which interest shall have been paid on such lost, stolen,
destroyed or mutilated Note or dated the date of such lost, stolen, destroyed
or mutilated Note if no interest shall have been paid thereon.

 

11.                                 PAYMENTS ON NOTES.

 

11.1.        Place of Payment. Subject to
Section 11.2, payments of principal, premium, if any, and interest becoming due
and payable on the Notes shall be made at an office in New York, New York
designated by the Companies. The Companies may, at any time, by notice to each
holder of the Notes, change the place of payment of the Notes so long as such
place of payment shall be either the principal office of the Company in such
jurisdiction or the principal office of a bank or trust company in such
jurisdiction.

 

11.2.        Home Office Payment. So long as
any Purchaser or its nominee shall be the holder of any Note, and
notwithstanding anything contained in Section 11.1 or in such Note to the
contrary, the Companies will pay all sums becoming due on such Note for
principal,

 

41

 

premium, if any, and interest by the method and at the
address specified for such purpose below such Purchaser’s name on Schedule I
attached hereto, or by such other method or at such other address located in
the United States of America as such Purchaser shall have from time to time
specified to the Companies for such purpose, without the presentation or
surrender of such Note or the making of any notation thereon, except that upon
the request of the Companies made concurrently with or reasonably promptly
after payment or prepayment in full of any Note, the Holder of such Note shall
surrender such Note for cancellation, reasonably promptly after any such
request, to the Companies at their principal executive office or at the place
of payment most recently designated by the Companies pursuant to Section 11.1.
Prior to any permitted sale, transfer or other disposition of any Note held by
any Purchaser or its nominee, such Purchaser will, at its election, either
endorse thereon the amount of principal paid thereon and the last date to which
interest has been paid thereon or surrender such Note to the Companies in
exchange for a new Note or Notes pursuant to Section 10.2. The Companies
will afford the benefits of this Section 11.2 to any Institutional Investor
that is the direct or indirect transferee of any Note purchased by a Purchaser
under this Agreement and that has made the same agreement relating to such Note
as such Purchaser have made in this Section 11.2 and in Section 17.

 

12.                                 EXPENSES, INCREASED COSTS AND
INDEMNIFICATION, ETC.

 

12.1.        Transaction Expenses. Whether or
not any of the transactions contemplated hereby are consummated, the Companies
will pay, within 15 days of each demand therefor (such demand to be
accompanied by supporting documentation in reasonable detail), (a) all of
the costs and expenses incurred by each Purchaser and each other holder of a
Note (including, without limitation, reasonable attorneys’ fees of a special
counsel and, if reasonably required, local or other appropriate counsel for all
Purchasers) in connection with the preparation, execution and delivery of this
Agreement and the other Note Documents and all amendments, waivers or consents
under or in respect of this Agreement or any of the other Note Documents
(whether or not such amendment, waiver or consent becomes effective), and
(b) all of the costs and expenses incurred by each Purchaser and each
other holder of a Note (including, without limitation, reasonable attorneys’
fees of a special counsel and if reasonably required, local or other
appropriate counsel for you and the Other Purchasers) in connection with the
administration and enforcement of this Agreement and the other Note Documents,
including, without limitation: 
(i) the reasonable costs and expenses incurred in enforcing or
defending (or determining whether or how to enforce or defend) any rights under
this Agreement or any of the other Note Documents or in responding to any
subpoena or other legal process or informal investigative demand issued in
connection with this Agreement or any of the other Note Documents, or by reason
of being a holder of the Notes, and (ii) the reasonable costs and expenses
(including, without limitation, financial advisors’ fees) incurred in
connection with the insolvency or bankruptcy of any Credit Party or
Restructured Subsidiary or in connection with any work-out, renegotiation or
restructuring of any of the transactions contemplated hereby or by the other
Note Documents. The Companies will pay, and will save each Purchaser and each
other holder of the Notes harmless from, all claims in respect of any fees,
costs or expenses, if any, of brokers and finders (other than those retained by
any such Purchaser or any such holder).

 

42

 

12.2.        Indemnity.

 

(a)           In addition to the payment of costs
and expenses pursuant to Section 12.1, the Companies agree, jointly and
severally to indemnify, pay and hold each Purchaser and each Purchaser’s
affiliates and such Purchaser and its Affiliates respective officers,
directors, employees, attorneys, agents and other advisors (each, an “Indemnified
Party”), harmless from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits and claims, and all
reasonable costs, expenses and disbursements, of any kind or nature whatsoever
(including, without limitation, reasonable fees and disbursements of counsel
for such Indemnified Parties) that may be incurred by or asserted or awarded
against any Indemnified Party, in each case arising out of or in connection
with or by reason of, or in connection with the preparation for a defense of,
any investigation, litigation or proceeding arising out of, related to, or in
connection with (i) this Agreement and the other Note Documents or any of
the transactions contemplated hereby or thereby, (ii) any use or intended use
of the proceeds of any of the Notes, or (iii) the actual or alleged
presence of Hazardous Materials on any property of the Companies or any of
their Subsidiaries or any Environmental Action relating in any way to the
Companies or any of their Subsidiaries, in each case whether or not such
investigation, litigation or proceeding is brought by any Company, any of their
Subsidiaries, its directors, shareholders or creditors or an Indemnified Party
or any Indemnified Party is otherwise a party thereto and whether or not any
sale and purchase of the Notes pursuant to this Agreement is effected
(collectively, the “Indemnified Liabilities”); provided that the
Companies shall not have any obligation to any Indemnified Party hereunder with
respect to any Indemnified Liabilities arising from the gross negligence
willful misconduct or bad faith of such Indemnified Party as determined in a
final, nonappealable judgment by a court of competent jurisdiction.

 

(b)           The Companies will not, without the
prior written consent of the applicable Indemnified Party, settle, compromise,
consent to the entry of any judgment in or otherwise seek to terminate any
action, claim, suit or proceeding in respect of which indemnification of such
Indemnified Party may be sought under subsection (a) of this
Section 12.2 (whether or not such Indemnified Party is a party thereto)
unless such settlement, compromise, consent or termination includes a full and
unconditional release of such Indemnified Party from any and all claims against
such Indemnified Party and any and all liabilities thereof arising out of or
relating to such action, claim, suit or proceeding.

 

(c)           The Companies also agree not to
assert any claim against any Purchaser or any of such Purchaser’s affiliates,
or any of such Purchaser or its affiliates’ officers, directors, employees,
attorneys, agents and other advisors, on any theory of liability, for special,
indirect, consequential or punitive damages arising out of or otherwise
relating to (i) this Agreement or any of the other Note Documents, or any
of the transactions contemplated hereby or thereby or (ii) any use or
intended use of the proceeds of any of the Notes.

 

(d)           If and to the extent that the
undertaking to indemnify, pay and hold harmless the Indemnified Parties set
forth in this Section 12.2 is judicially determined to be unavailable to
an Indemnified Party in respect of, or is insufficient with respect to, any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits
or claims referred to herein, then, in lieu of indemnifying such Indemnified
Party hereunder, the Companies shall contribute to the amount paid or payable
by such Indemnified Party as a result of such liabilities,

 

43

 

obligations, losses, damages,
penalties, actions, judgments, suits or claims (and reasonable costs, expenses
and disbursements relating thereto) (i) in such proportion as is appropriate to
reflect the relative benefits to the Companies and their Subsidiaries, on the
one hand, and such Indemnified Party, on the other hand, from this Agreement
and the sale and purchase of the Notes or (ii) if the allocation provided by
clause (i) of this subsection (d) is not available, in such proportion as
is appropriate to reflect not only the relative benefits referred to in such
clause (i) but also the relative fault of each of the Companies and their
Subsidiaries, on the one hand, and such Indemnified Party, on the other hand,
in connection with such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits or claims, as well as any other relevant equitable
considerations.

 

12.3.        Taxes.

 

(a)           Any and all payments by or on behalf
of the Companies hereunder or under the Note Documents shall be made in
accordance with the terms hereof and the other applicable Note Documents, free
and clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, withholdings or other governmental charges, and
all liabilities with respect thereto, excluding net income taxes and branch
profits taxes that are imposed by the United States of America and net income
taxes and franchise taxes (whether based on income or capital) that are imposed
on such holder of the Notes by the state or foreign jurisdiction under the laws
of which such holder of the Notes is organized, engages in a trade or business
through an office or other fixed place of business maintained by such holder in
such state or foreign jurisdiction, or has its principal office, or any
political subdivision thereof (all such nonexcluded taxes, levies, imposts,
deductions, withholdings, other governmental charges and liabilities in respect
of payments hereunder or under the Note Documents being hereinafter referred to
as “Taxes”). If the Companies shall be required by law to deduct any Taxes from
or in respect of any sum payable hereunder or under any of the Note Documents
to any holder of the Notes, (i) the sum payable shall be increased as may
be necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 12.3) such holder
of the Notes receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Companies shall make such deductions
and (iii) the Companies shall pay the full amount deducted to the relevant
taxation authority or other Governmental Authority in accordance with
applicable law.

 

(b)           In addition, the Companies shall pay
any present or future transfer, stamp, documentary, excise, property or other
similar taxes, assessments, charges or levies that arise from any payment made
hereunder or under the other Note Documents or from the execution, delivery,
filing or registration of, performance under, or otherwise with respect to,
this Agreement or any of the other Note Documents (other than any stamp tax or
other governmental charge that arises solely from any transfer of Notes in
respect of which the Companies are entitled to receive payment under
Section 10.2) (hereinafter referred to as “Other Taxes”).

 

(c)           The Companies agree to indemnify, pay
and hold each holder of the Notes harmless from and against the full amount of
Taxes and Other Taxes, and for the full amount of taxes of any kind imposed by
any jurisdiction on amounts payable under this Section 12.3, imposed on or
paid by such holder of the Notes as a result of receiving any payment by or on
behalf of the Companies hereunder or under the other Note Documents and

 

44

 

any liability (including
penalties, additions to tax, interest and expenses) arising therefrom or with
respect thereto. This indemnification shall be made within 30 days from
the date such holder of the Notes makes written demand therefor accompanied by
evidence as is reasonably available to such holder demonstrating that holder is
liable for or must otherwise pay such Taxes or Other Taxes.

 

(d)           Within 30 days after the date of any
payment of Taxes, the Companies shall furnish to each holder of the Notes, at
its address referred to in Section 15, the original receipt of payment
thereof or a certified copy of such receipt. In the case of any payment
hereunder or under any of the other Note Documents by or on behalf of the
Companies through an account or branch outside the United States or by or on
behalf of the Companies by a payor that is not a United States person, if the
Companies determine that no Taxes are payable in respect thereof, the Companies
shall furnish, or shall cause such payor to furnish, to each holder of the
Notes, at such address, an opinion of counsel acceptable to each holder of the
Notes stating that such payment is exempt from Taxes. For purposes of this
subsection (d) and subsection (e) of this Section 12.3, the terms
“United States” and “United States person” shall have the meanings specified in
Section 7701 of the Internal Revenue Code.

 

(e)           Each holder of the Notes that is not
(i) a citizen or resident of the United States, (ii) a corporation, partnership
or other entity created or organized in or under the laws of the United States
(or any jurisdiction thereof), (iii) an estate that is subject to federal
income taxation regardless of the source of its income or (iv) a trust the
administration of which is within the primary supervision of a Court in the
United States and as to which one or more United States persons have the
authority to control all substantial decisions (a “Non-U.S. Holder”) shall, on
or prior to the date of its execution and delivery of this Agreement, in the
case of an original purchaser of the Notes, and on the date in which it becomes
a holder of the Notes, in the case of each subsequent holder of the Notes, and
from time to time thereafter as requested in writing by the Companies, deliver
to the Agent and the Companies two copies of either U.S. Internal Revenue
Service Form W-8BEN or Form W-8ECI (or successor forms thereto), or, in the
case of a Non-U.S. Lender claiming exemption from U.S. federal withholding tax
under Section 871(h) or 881(c) of the Internal Revenue Code of 1986, as
amended, with respect to payments of “portfolio interest” a statement
substantially in the form of Exhibit E and a Form W-8BEN, or any subsequent
versions thereof or successors thereto properly completed and duly executed by
such Non-U.S. Holder claiming complete exemption from, or a reduced rate of,
U.S. federal withholding tax on all payments by the Companies under this
Agreement. Each Non-U.S. Holder shall promptly notify the Companies at any time
it determines that it is no longer in a position to provide any previously
delivered certificate to the Companies (or any other form of certification
adopted by the U.S. taxing authorities for such purpose). Notwithstanding any
other provision of this paragraph (e), a Non-U.S. Holder shall not be required
to deliver any form pursuant to this paragraph (e) that such Non-U.S. Holder is
not legally able to deliver. If the form provided by a holder of the Notes
pursuant to this subsection (e) at the time such holder of the Notes first
becomes a party to this Agreement indicates a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered excluded from Taxes unless and until such holder of the Notes
provides the appropriate form certifying that a lesser rate applies, whereupon
withholding tax at such lesser rate only shall be considered excluded from
Taxes for periods governed by such form. If any form or document referred to in
this subsection (e) requires the disclosure of information, other than
information necessary to

 

45

 

compute the tax payable and information required on
the date hereof by Internal Revenue Service form W-8BEN or W-8ECI (or the
related certificate attached hereto as Exhibit E) that the holder of the Notes
reasonably considers to be confidential, the holder of the Notes shall give
notice thereof to the Companies and shall not be obligated to include in such
form or document such confidential information.

 

(f)            For any period with respect to which
a holder of the Notes has failed to provide the Companies with the appropriate
form or document described in subsection (e) of this Section 12.3
(other than if such failure is due to a change in law occurring after the date
on which a form originally was required to be provided or if such form is not
required under the last sentence of such subsection (e)), such holder of the
Notes shall not be entitled to additional amounts or indemnification under
subsection (a) or (c) of this Section 12.3 with respect to Taxes imposed
by the United States by reason of such failure; provided, however,
that should a holder of the Notes become subject to Taxes because of its
failure to deliver a form required hereunder, the Companies shall take such
steps as such holder of the Notes shall reasonably request to assist such
holder of the Notes to recover such Taxes.

 

(g)           Any holder of the Notes claiming any
additional amounts payable pursuant to this Section 12.3 shall use
reasonable efforts (consistent with its internal policy and legal and
regulatory restrictions) to file any certificate or document reasonably
requested by the Companies or to change the jurisdiction of its applicable
lending office if the making of such a filing or such change would avoid the
need for or reduce the amount of any such additional amounts that may
thereafter accrue and would not, in the sole determination of such holder, be
otherwise disadvantageous to such holder.

 

12.4.        Survival. The Obligations of the
Companies under this Section 12 
shall survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of this Agreement or any of the other Note
Documents, and the termination of this Agreement and any commitment to purchase
Notes hereunder and, in respect of any Person who was at any time a Purchaser
or in whose name or for whose benefit such Person held any Note, the date on
which such Person no longer holds, or no longer holds in the name of or for the
benefit of any other Person, any Note.

 

13.                                 SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; ENTIRE AGREEMENT.

 

All
representations and warranties contained herein and in the other Note
Documents, and in any certificate or other instrument delivered by or on behalf
of the Companies pursuant to this Agreement or any of the other Note Documents,
shall survive the execution and delivery of this Agreement and the Notes, the
purchase or transfer by you of any Notes or portion thereof or interest therein
and the payment of any Notes, and may be relied upon by any subsequent holder
of the Notes as of the date made or deemed made, regardless of any
investigation made at any time by or on behalf of you or any other holder of
the Notes. This Agreement and the other Note Documents embody the entire
agreement and understanding between you, the Company and its Subsidiaries and
supersede all prior agreements and understandings relating to the subject
matter hereof.

 

46

 

14.                                 AMENDMENT AND WAIVER.

 

14.1.        Requirements. This Agreement and
the Notes may be amended, and the observance of any term hereof or of the Notes
may be waived (either retroactively or prospectively), with and only with the
written consent of the Companies and the Required Holders, except that
(a) no amendment or waiver of any of the provisions of Sections 1, 2, 3,
4, 5, 6 and 18 will be effective as to any Purchaser unless consented to in
writing by such Purchaser and (b) no such amendment or waiver shall,
without the written consent of the holder of each Note at the time outstanding,
do any of the following at any time:

 

(i)            subject to the provisions of
Section 9 relating to acceleration or rescission, change the amount or the
time of any prepayment, repurchase or payment of principal of, or reduce the
rate, or change the time fixed for any payment or change the method of
computation of interest on, the Notes;

 

(ii)           change the percentage of the
aggregate principal amount of the Notes the holders of which are required to
consent to any such amendment or waiver;

 

(iii)          subordinate the Notes (or any of them)
to any other obligations of the Company now or hereafter existing other than as
provided in this Agreement or the Intercreditor Agreements;

 

(iv)          reduce or limit the Companies’
liability with respect to any Obligations owing to any Purchaser or any other
holder of any Note under or in respect of any of the Note Documents; or

 

(v)           amend any of Sections 7, 9.2, 14.2
and 17; or

 

(vi)          release all or substantially all of
the Collateral except as provided in Section 20.7.

 

Notwithstanding
any of the foregoing provisions of this Section 14.1, none of the defined terms
set forth in Schedule II hereto shall be amended, supplemented or
otherwise modified in any manner that would change the meaning, purpose or
effect of this Section 14.1 or any Section referred to herein unless
such amendment or modification is agreed to in writing by the holders of the
Notes otherwise required to amend or waive such Section under the terms of this
Section 14.1.

 

14.2.        Solicitation of Holders of Notes.

 

(a)           Solicitation. The Companies
will provide each holder of the Notes (irrespective of the amount of Notes then
owned or otherwise held by it at the time) with sufficient information,
reasonably far in advance of the date a decision is required, to enable such
holder to make an informed and considered decision with respect to any proposed
amendment, waiver or consent in respect of any of the provisions of this
Agreement or any of the other Note Documents. The Companies will deliver
executed or true and correct copies of each amendment, waiver or consent
effected pursuant to the provisions of this Section 14 to each holder of

 

47

 

outstanding Notes promptly following the date on which
it is executed and delivered by, or receives the consent or approval of, the
requisite holders of the Notes.

 

(b)           Payment. The Companies will
not directly or indirectly pay or cause to be paid any remuneration, whether by
way of supplemental or additional interest, fee or otherwise, or grant any
security, to any holder of Notes as consideration for or as an inducement to
the entering into by any holder of Notes of any waiver or amendment of any of
the terms and provisions of this Agreement or any of the other Note Documents,
unless such remuneration is concurrently paid, or security is concurrently
granted, on the same terms, ratably to each holder of Notes then outstanding
that consents to such waiver or amendment.

 

14.3.        Binding Effect, Etc. Any
amendment or waiver consented to as provided in this Section 14 applies
equally to all holders of Notes and is binding upon them, upon each future
holder of any Note and upon the Companies without regard to whether such Note
has been marked to indicate such amendment or waiver. No such amendment or
waiver will extend to or affect any obligation, covenant, agreement, Default or
Event of Default not expressly amended or waived or impair any right, power or
remedy consequent thereon. No course of dealing nor any delay on the part of
any holder of any Note in exercising any right, power or remedy hereunder or
under any of the other Note Documents shall operate as a waiver of any right,
power or remedy of any holder of such Note; nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. The
remedies provided under this Agreement and the other Note Documents are
cumulative and not exclusive of any rights, powers or remedies provided by
applicable law

 

14.4.        Notes Held by Companies, Etc. Solely
for the purpose of determining whether the holders of the requisite percentage
of the aggregate principal amount of Notes then outstanding approved or
consented to any amendment, waiver or consent to be given under this Agreement
or any of the other Note Documents, or have directed the taking of any action
provided for herein or in any of the other Note Documents to be taken upon the
direction of the holders of a specified percentage of the aggregate principal
amount of Notes then outstanding, Notes directly or indirectly owned by the
Companies or any of their Affiliates shall be deemed not to be outstanding.

 

15.                                 NOTICES.

 

(a)           All notices and other communications
provided for hereunder shall be in writing and delivered by telecopier or (if
expressly permitted under the applicable provisions hereof) by telephone, if
the sender on the same day sends a confirming copy of such notice by a
recognized overnight delivery service (charges prepaid), by registered or
certified mail with return receipt requested (postage prepaid) or by a
recognized overnight delivery service (with charges prepaid). Any such notice
must be sent:

 

(i)            if to any Purchaser or its nominee,
to it at the address specified for such communications in Schedule I hereto, or
at such other address as such Purchaser shall have specified to the Companies
in writing;

 

48

 

(ii)           if to any other holder of any Note,
to such holder at such address as such other holder shall have specified to the
Companies in writing; or

 

(iii)          if to the Parent or any Company, to it
at 200 South Andrews Avenue, Fort Lauderdale, Florida 33301, Attention:  Mr. Howard Schwartz or at such other address
as such Person shall have specified to the holder of each Note in writing.

 

All
notices and other communications provided for under this Section 15 will
be deemed given and effective only when actually received.

 

(b)           If any notice required under this
Agreement or any of the other Note Documents is permitted to be made, and is
made, by telephone, actions taken or omitted to be taken in reliance thereon by
the Agent or any Purchaser shall be binding upon the Companies notwithstanding
any inconsistency between the notice provided by telephone and any subsequent
writing in confirmation thereof provided to the Agent or any Purchaser, provided
that any such action taken or omitted to be taken by the Agent or any Purchaser
shall have been in good faith and in accordance with the terms of this
Agreement.

 

16.                                 REPRODUCTION OF DOCUMENTS.

 

This
Agreement, each of the other Note Documents and all other agreements,
certificates and other documents relating thereto, including, without
limitation, (a) amendments, waivers and consents of or to this Agreement or any
other Note Document that may hereafter be executed, (b) documents received
by the Agent or any Purchaser on the Purchase Date (except the Notes
themselves) and (c) financial statements, certificates and other
information previously or hereafter furnished to the Agent or any Purchaser,
may be reproduced by the Agent or any Purchaser by any photographic,
photostatic, microfilm, microcard, miniature photographic or other similar
process. The Companies agree and stipulate that, to the extent permitted by
applicable law, any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding (whether or not
the original is in existence and whether or not such reproduction was made by
the Agent or any Purchaser in the regular course of business) and any
enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence. This Section 16 shall not prohibit the
Companies or any other holder of Notes from contesting any such reproduction to
the same extent that it could contest the original or from introducing evidence
to demonstrate the inaccuracy of any such reproduction.

 

17.                                 CONFIDENTIAL INFORMATION.

 

Each
Purchaser hereby agrees to maintain, and to cause each of the Persons referred
to in clause (a) of this Section 17 to which it delivers or discloses
Confidential Information to maintain, the confidentiality of all Confidential
Information in accordance with procedures adopted by such Purchaser in good faith
to protect confidential information of third parties delivered to it; provided
that such Purchaser may deliver or disclose Confidential Information to
(a) its affiliates and its respective directors, officers, employees,
agents, attorneys and other advisors (to the extent such disclosure reasonably
relates to the administration of the investment represented by your Notes),
(b) such Purchaser’s counsel and financial and other professional advisors
who agree to hold confidential the Confidential Information substantially in
accordance

 

49

 

with
the terms of this Section 17, (c) any other holder of any Note,
(d) any Person to which such Purchaser sells or offers to sell any Note or
any part thereof or any participation therein (if such Person has agreed in
writing prior to its receipt of such Confidential Information to be bound by
provisions similar to the provisions of this Section 17), (e) any Person
from which such Purchaser offers to purchase any security of any Company (if
such Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by provisions similar to the provisions of this Section
17), (f) to the extent required or requested thereby, any federal or state
regulatory authority having jurisdiction over such Purchaser, (g) any
regulatory examiners or auditors or accountants or any similar organization, or
any nationally recognized rating agency that requires access to information
about its investment portfolio or (h) any other Person to which such
delivery or disclosure may be necessary (i) in order to effect compliance
with any Requirement of Law applicable to such Purchaser, (ii) in response
to any subpoena or other legal process or (iii) in connection with any litigation
to which such Purchaser or any other holder of any Note is a party. Each holder
of a Note, by its acceptance of a Note, will be deemed to have agreed to be
bound by and to be entitled to the benefits of this Section 17 as though it
were a party to this Agreement. Upon the reasonable request of the Companies in
connection with the delivery to any holder of a Note of information required to
be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Companies embodying the provisions
of this Section 17. Nothing in this Section 17 shall obligate any Purchaser or
any other holder of the Notes to return any Confidential Information furnished
by or on behalf of the Companies or any of their Subsidiaries to the Companies
or any such Subsidiary.

 

18.                                 SUBSTITUTION OF PURCHASER.

 

Each
Purchaser shall have the right to substitute any Person as the purchaser of the
Notes that such Purchaser has agreed to purchase hereunder, by notice to the
Companies, which notice shall be signed by both such Purchaser and such Person,
shall contain such Person’s agreement to be bound by this Agreement and shall
contain a confirmation by such Person of the accuracy with respect to it of the
representations set forth in Section 6. Upon receipt of such notice, each
reference herein to such Purchaser (other than in this Section 18) shall
be deemed to refer to such Person in lieu of such Purchaser. In the event that
such Person is so substituted as a purchaser hereunder and such Person
thereafter transfers to such Purchaser all of the Notes then held by such
Person, upon receipt by the Companies of notice of such transfer, each
reference herein to such Person (other than in this Section 18) shall no longer
be deemed to refer to such Person, but shall refer to such Purchaser, and such
Purchaser shall have all of the rights of an original holder of the Notes under
this Agreement.

 

19.                                 GUARANTY OF PARENT.

 

19.1.        Guaranty. The Parent hereby
unconditionally and irrevocably guarantees the punctual payment when due,
whether at stated maturity, by acceleration or otherwise, of all Obligations of
the Companies now or hereafter existing under any Note Document, whether for
principal, interest (including all interest that accrues after the commencement
of any case, proceeding or other action relating to bankruptcy, insolvency or
reorganization of the Companies), fees, expenses or otherwise, and agrees to
pay any and all expenses (including reasonable counsel fees and expenses)
incurred by the Agent and the Purchasers in enforcing any

 

50

 

rights under the guaranty set forth in this Section
19. Without limiting the generality of the foregoing, the Parent’s liability
shall extend to all amounts that constitute part of the Obligations and would
be owed by the Companies to the Agent and the Purchasers under any Note
Document but for the fact that they are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
any Company.

 

19.2.        Guaranty Absolute. The Parent
guarantees that the Obligations will be paid strictly in accordance with the
terms of the Note Documents, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of the Agent or any Purchaser with respect thereto. The obligations of
the Parent under this Section 19 are independent of the Obligations, and a
separate action or actions may be brought and prosecuted against the Parent to
enforce such obligations, irrespective of whether any action is brought against
the Company or whether any Company are joined in any such action or actions. The
liability of the Parent under this Section 19 shall be irrevocable, absolute
and unconditional irrespective of, and the Parent hereby irrevocably waives any
defenses it may now or hereafter have in any way relating to, any or all of the
following:

 

(a)           any lack of validity or
enforceability of any Note Document or any agreement or instrument relating
thereto;

 

(b)           any change in the time, manner or
place of payment of, or in any other term of, all or any of the Obligations, or
any other amendment or waiver of or any consent to departure from any Note
Document, including any increase in the Guaranteed Obligations resulting from
the purchase of additional Notes from the Companies or otherwise;

 

(c)           any taking, exchange, release or
non-perfection of any Collateral, or any taking, release or amendment or waiver
of or consent to departure from any other guaranty, for all or any of the
Obligations;

 

(d)           any change, restructuring or
termination of the corporate, limited liability company or partnership
structure or existence of any Subsidiaries of the Parent; or

 

(e)           any other circumstance (including any
statute of limitations) or any existence of or reliance on any representation
by the Agent or you that might otherwise constitute a defense available to, or
a discharge of, the Parent, any Company or any other guarantor or surety.

 

This
Section 19 shall continue to be effective or be reinstated, as the case may be,
if at any time any payment of any of the Obligations is rescinded or must
otherwise be returned by you or any other Person upon the insolvency,
bankruptcy or reorganization of any Company or otherwise, all as though such
payment had not been made.

 

19.3.        Waiver. The Parent hereby waives
promptness, diligence, notice of acceptance and any other notice with respect
to any of the Guaranteed Obligations and this Section and any requirement that
the Agent or you exhaust any right or take any action against the Companies or
any other Person or any Collateral. the Parent acknowledges that it will
receive direct and indirect benefits from the financing arrangements
contemplated herein and that the waiver set forth in this subsection 19.3
is knowingly made in contemplation of such benefits.

 

51

 

the Parent hereby waives any right to revoke this
Section, and acknowledges that this Section 19 is continuing in nature and
applies to all Obligations, whether existing now or in the future.

 

19.4.        Continuing Guaranty; Assignments.
This Section 19 is a continuing guaranty and shall (a) remain in full
force and effect until the later of the cash payment in full of the Obligations
(other than indemnification obligations as to which no claim has been made) and
all other amounts payable under this Section 19 and the Stated Maturity,
(b) be binding upon the Parent, its successors and assigns and
(c) inure to the benefit of and be enforceable by the Agent and the
Purchasers and the Agent and the Purchasers’ successors, pledgees, transferees
and assigns. Without limiting the generality of the foregoing clause (c),
each Purchaser may pledge, assign or otherwise transfer all or any portion of
its rights and obligations under this Agreement (including all or any portion
of the Notes held by it) to any other Person, and such other Person shall
thereupon become vested with all the benefits in respect thereof granted to
such Purchaser herein or otherwise.

 

19.5.        Subrogation. The Parent will not
exercise any rights that it may now or hereafter acquire against any Company,
or any other insider guarantor that arise from the existence, payment,
performance or enforcement of the Parent’s obligations under this Section 19,
including any right of subrogation, reimbursement, exoneration, contribution or
indemnification and any right to participate in any claim or remedy of the
Agent and the Purchasers you against the Companies, or any other insider
guarantor or any collateral, whether or not such claim, remedy or right arises
in equity or under contract, statute or common law, including the right to take
or receive from the Companies, or any other insider guarantor, directly or
indirectly, in cash or other property or by set-off or in any other manner,
payment or security solely on account of such claim, remedy or right, unless
and until all of the Obligations and all other amounts payable under this
Section shall have been paid in full in cash and the Stated Maturity shall have
occurred. If any amount shall be paid to the Parent in violation of the
immediately preceding sentence at any time prior to the later of the payment in
full in cash of the Obligations and all other amounts payable under this
Section and the Stated Maturity, such amount shall be held in trust for the
benefit of the Agent and the Purchasers and shall forthwith be paid to the
Agent and the Purchasers to be credited and applied to the Obligations and all
other amounts payable under this Section 19, whether matured or unmatured, in
accordance with the terms of this Agreement, or to be held as collateral for
any Obligations or other amounts payable under this Section 19 thereafter
arising. If (i) the Parent shall make payment to the Agent and you of all
or any part of the Obligations, (ii) all of the Guaranteed Obligations and
all other amounts payable under this Section shall be paid in full in cash and
(iii) the Stated Maturity shall have occurred, the Agent and each
Purchasers will, at the Parent’s request and expense, execute and deliver to
the Parent appropriate documents, without recourse and without representation
or warranty, necessary to evidence the transfer by subrogation to the Parent of
an interest in the Obligations resulting from such payment by the Parent.

 

20.                                 THE AGENT.

 

20.1.        Authorization and Action.

 

(a)           Each Purchaser hereby appoints
Madeleine L.L.C. as the Agent hereunder and each Purchaser authorizes the Agent
to take such action as agent on its behalf and

 

52

 

to exercise such powers under this Agreement and the
other Note Documents as are delegated to the Agent under such agreements and to
exercise such powers as are reasonably incidental thereto. Without limiting the
foregoing, each Purchaser hereby authorizes the Agent to execute and deliver,
and to perform its obligations under, each of the Note Documents to which the Agent
is a party, to exercise all rights, powers and remedies that the Administrative
Agent may have under such Note Documents and, in the case of the Pledge
Agreement, to act as agent for the Purchasers and the other Secured Parties
under such Note Document.

 

(b)           As to any matters not expressly
provided for by this Agreement and the other Note Documents (including
enforcement or collection) the Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Required Holders, and such instructions shall be
binding upon all Purchasers and other holders of the Notes; provided, however,
that the Agent shall be required to take any action that (i) the Agent in
good faith believes exposes it to personal liability unless the Agent receives
an indemnification satisfactory to it from the Purchasers and other holders of
the Notes with respect to such action or (ii) is contrary to this
Agreement, any Note Document or any applicable requirement of law. The Agent
agrees to give to each Purchaser and each other holder of a Note prompt notice
of each notice given to it by any Credit Party pursuant to the terms of this
Agreement or the other Note Documents.

 

(c)           In performing its functions and
duties hereunder and under the other Note Documents, the Agent is acting solely
on behalf of the Purchasers and other holders of the Notes and its duties are
entirely administrative in nature. The Agent does not assume and shall not be
deemed to have assumed any obligation other than as expressly set forth herein
and in the other Note Documents or any other relationship as the agent,
fiduciary or trustee of or for any Purchaser and each other holder of a Note.
The Agent may perform any of its duties under any Loan Document by or through
its agents or employees.

 

20.2.        Agent’s Reliance, Etc.  None
of the Agent, any of its Affiliates or any of their respective directors,
officers, agents or employees shall be liable for any action taken or omitted
to be taken by it, him, her or them under or in connection with this Agreement
or the other Note Documents, except for its, his, her or their own gross
negligence or willful misconduct. Without limiting but subject to the
foregoing, the Agent (a) may treat the payee of any Note as its holder
until such Note has been assigned in accordance with Section 10.2, (b) may
rely on the Register to the extent set forth in Section 10.1, (c) may consult
with legal counsel (including counsel to any Credit Party), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts, (d) makes no warranty or
representation to any Purchaser or other holder of a Note and shall not be
responsible to any Purchaser or other holder of a Note for any statements,
warranties or representations made by or on behalf of the Parent or any of its
Subsidiaries in or in connection with this Agreement or any other Note
Document, (e) shall not have any duty to ascertain or to inquire either as
to the performance or observance of any term, covenant or condition of this
Agreement or any other Note Document, as to the financial condition of any Note
Party or as to the existence or possible existence of any Default or Event of
Default, (f) shall not be responsible to any Purchaser or other holder of
a Note for the due execution, legality, validity, enforceability, genuineness,

 

53

 

sufficiency or value of, or the attachment, perfection
or priority of any Lien created or purported to be created under or in
connection with, this Agreement, any other Note Document or any other
instrument or document furnished pursuant hereto or thereto and (g) shall
incur no liability under or in respect of this Agreement or any other Note
Document or by acting upon any notice, consent, certificate or other instrument
or writing (which writing may be a telecopy or, if consented to by the Agent,
electronic mail) or any telephone message believed by it to be genuine and
signed or sent by the proper party or parties.

 

20.3.        The Agent Individually. With respect
to its Ratable Portion, to the extent that the Agent is a Purchaser or holder
of a Note it shall have and may exercise the same rights and powers hereunder
and is subject to the same obligations and liabilities as and to the extent set
forth herein for any other Purchaser or other holder of a Note.

 

20.4.        Purchaser Credit Decision. Each
Purchaser acknowledges that it shall, independently and without reliance upon
the Agent conduct its own independent investigation of the financial condition
and affairs of the Credit Parties in connection with the purchasing Notes. Each
Purchaser also acknowledges that it shall, independently and without reliance
upon the Agent or any other Purchaser or other holder or other holder of a Note
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement and the other Note Documents.

 

20.5.        Indemnification. Each Purchaser
and other holder of a Note agrees to indemnify the Agent and each of its
Affiliates, and each of their respective directors, officers, employees, agents
and advisors (to the extent not reimbursed by the Credit Parties), from and
against such Purchaser or holder’s aggregate Ratable Portion of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses and disbursements (including fees, expenses and
disbursements of financial and legal advisors) of any kind or nature whatsoever
that may be imposed on, incurred by, or asserted against, the Agent or any of
its Affiliates, directors, officers, employees, agents and advisors in any way
relating to or arising out of this Agreement or the other Note Documents or any
action taken or omitted by the Agent under this Agreement, or the other Note
Documents; provided, however, that no Lender shall be liable for
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Agent’s or such Affiliate’s gross negligence or willful misconduct. Without
limiting the foregoing, each Purchaser and holder of a Note agrees to reimburse
the Agent promptly upon demand for its ratable share of any out-of-pocket
expenses (including fees, expenses and disbursements of financial and legal
advisors) incurred by the Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of its rights or responsibilities under, this Agreement or the other
Note Documents, to the extent that the Agent is not reimbursed for such
expenses by any Credit Party.

 

20.6.        Successor Administrative Agent.
The Agent may resign at any time by giving written notice thereof to the
Purchasers and the Credit Parties. Upon any such resignation, the Required
Holders shall have the right to appoint a successor Agent. If no successor
Agent shall have been so appointed by the Required Holders, and shall have
accepted

 

54

 

such appointment, within 30 days after the retiring
Agent’s giving of notice of resignation, then the retiring Agent may, on behalf
of the Purchasers, appoint a successor Agent, selected from among the
Purchasers. In either case, such appointment shall be subject to the prior
written approval of the Credit Parties (which approval may not be unreasonably
withheld and shall not be required upon the occurrence and during the
continuance of an Event of Default). Upon the acceptance of any appointment as
Agent by a successor Agent, such successor Agent shall succeed to, and become
vested with, all the rights, powers, privileges and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations under this Agreement and the other Note Documents. Prior to any
retiring Agent’s resignation hereunder as Agent, the retiring Agent shall take
such action as may be reasonably necessary to assign to the successor Agent its
rights as Agent under the Note Documents. After such resignation, the retiring
Agent shall continue to have the benefit of this Section 20 as to any actions
taken or omitted to be taken by it while it was Agent under this Agreement and
the other Note Documents.

 

20.7.        Concerning the Collateral and the
Pledge Agreement.

 

(a)           Each Purchaser and each other holder
of a Note agrees that any action taken by the Agent or the Required Holders
(or, where required by the express terms of this Agreement, a greater
proportion of the holders of Notes) in accordance with the provisions of this
Agreement or the other Note Documents, and the exercise by the Agent or the
Required Holders (or, where so required, such greater proportion) of the powers
set forth herein or therein, together with such other powers as are reasonably
incidental thereto, shall be authorized and binding upon all Purchasers, such
other holders and other Secured Parties. Without limiting the generality of the
foregoing, the Agent shall have the sole and exclusive right and authority to
(i) act as the disbursing and collecting agent for the Purchasers, such
other holders and with respect to all payments and collections arising in
connection herewith and with the Note Documents, (ii) execute and deliver
the Purchase Agreement and accept delivery of each such agreement delivered by
the Parent or any of its Subsidiaries, (iii) act as collateral agent for
the Purchasers, such other holders and the other Secured Parties for purposes
of the perfection of all security interests and Liens created by such
agreements and all other purposes stated therein, provided, however,
that the Agent hereby appoints, authorizes and directs each Purchaser and other
holder of a Note to act as collateral sub-agent for the Agent, the Purchasers
and the other holders of Notes for purposes of the perfection of all security
interests and Liens with respect to any Collateral held by such Purchaser or
other holder, (iv) manage, supervise and otherwise deal with the
Collateral, (v) take such action as is necessary or desirable to maintain
the perfection and priority of the security interests and Liens created or
purported to be created by the Pledge Agreement and (vi) except as may be
otherwise specifically restricted by the terms hereof, of any other Note
Document, exercise all remedies given to the Agent, the Purchasers and the
other holders of Notes and the other Secured Parties with respect to the
Collateral under the Note Documents relating thereto, applicable law or
otherwise.

 

(b)           Each of the Purchasers and the other
holders of Notes hereby directs, in accordance with the terms hereof, the Agent
to release any Lien held by the Agent for the benefit of the Purchasers and the
other holders of the Notes against any of the following:

 

55

 

(i)            all of the Collateral, upon payment
and satisfaction in full of all Obligations that the Agent has been notified in
writing are then due and payable; and

 

(ii)           if such sale or disposition is
permitted by this Agreement (or permitted pursuant to a waiver or consent of a
transaction otherwise prohibited by this Agreement), any Collateral sold or
disposed of by a Credit Party or a Restricted Subsidiary.

 

Each
of the Purchasers and the other holders of Notes hereby directs the Agent to
execute and deliver or file such termination and partial release statements and
do such other things as are necessary to release Liens to be released pursuant
to this Section 20.7 promptly upon the effectiveness of any such release.

 

21.                                 MISCELLANEOUS.

 

21.1.        Successors and Assigns. All
covenants and other agreements contained in this Agreement or any of the other
Note Documents by or on behalf of any of the parties hereto bind and inure to
the benefit of their respective successors and assigns (including, without
limitation, any subsequent holder of a Note), whether or not so expressed.

 

21.2.        Payments Due on Non-Business Days.
Anything in this Agreement or the Notes to the contrary notwithstanding, any
payment of principal of, or premium, if any, or interest on, any Note that is
due on a date other than a Business Day shall be made on the next succeeding
Business Day without including the additional days elapsed in the computation
of the items payable on such next succeeding Business Day.

 

21.3.        Satisfaction Requirement. Except
as otherwise provided herein or in any of the other Note Documents, if any
agreement, certificate or other writing, or any action taken or to be taken, is
by the terms of this Agreement or any of the other Note Documents required to
be satisfactory to the Purchasers or to the Required Holders, the determination
of such satisfaction shall be made by you or the Required Holders, as the case
may be, in the sole and exclusive judgment (exercised reasonably and in good
faith) of the Person or Persons making such determination.

 

21.4.        Severability. Any provision of
this Agreement that 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 (to the full
extent permitted by applicable law) not invalidate or render unenforceable such
provision in any other jurisdiction.

 

21.5.        Construction; Accounting Terms, Etc.

 

(a)           Each covenant contained herein shall
be construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.

 

56

 

(b)           Except as otherwise expressly
provided in this Agreement or any of the other Note Documents, all accounting
terms used herein or therein shall be interpreted, and all financial statements
and certificates and reports as to financial matters required to be delivered
hereunder shall be prepared, in accordance with GAAP.

 

21.6.        Computation of Time Periods. In
this Agreement, in the computation of periods of time from a specific date to a
later specified date, the word “from” means “from and including”, the word
“through” means “through and including”, and the words “to” and “until” each
mean “to but not excluding”.

 

21.7.        Execution in Counterparts. This
Agreement may be executed in any number of counterparts and by different
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. Delivery of an executed counterpart of a signature
page to this Agreement by telecopier shall be effective as delivery of a
manually executed counterpart of this Agreement. 

 

21.8.        Governing Law; Submission to
Jurisdiction, Etc.

 

(a)           This Agreement shall be governed by,
and construed in accordance with, the law of the State of New York.

 

(b)           Each of the Parent and the Companies
hereby irrevocably and unconditionally submits, for itself, its Subsidiaries
and its and their property and assets, to the nonexclusive jurisdiction of any
New York state court or federal court of the United States of America sitting
in New York City, New York, and any appellate court from any thereof, in any
action or proceeding arising out of or relating to this Agreement or the other
Note Documents, or for recognition or enforcement of any judgment in respect
thereof, and each of the Parent and the Companies hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York state court or, to
the fullest extent permitted by applicable law, in such federal court. Each of
the Parent and the Companies hereby irrevocably consents to the service of
copies of any summons and complaint and any other process which may be served
in any such action or proceeding by certified mail, return receipt requested,
or by delivering a copy of such process to it, at its address specified in
Section 15, or by any other method permitted by law. Each of the Parent
and the Companies hereby agrees that 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 applicable law. Nothing
in this Agreement shall affect any right that any holder of Notes may otherwise
have to bring any action or proceeding relating to this Agreement or the other
Note Documents in the courts of any jurisdiction.

 

(c)           Each of the Parent and the Companies
hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection that it may now or hereafter have
to the laying of venue of any action or proceeding arising out of or relating
to this Agreement or the other Note Documents in any New York state or federal
court. Each of the Parent and the Companies hereby irrevocably waives, to the
fullest extent

 

57

 

permitted by applicable law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

 

21.9.        Waiver of Jury Trial. EACH OF THE
PARENT, THE COMPANIES AND THE HOLDERS OF THE NOTES HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER
BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE NOTES OR ANY OF THE OTHER NOTE DOCUMENTS, ANY DOCUMENT DELIVERED
UNDER THE NOTE DOCUMENTS, THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, OR
THE ACTIONS OF ANY HOLDER OF THE NOTES IN THE NEGOTIATION, ADMINISTRATION,
PERFORMANCE OR ENFORCEMENT THEREOF.

 

58

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
  VANGUARD
  CAR RENTAL USA

  HOLDINGS INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  HOWARD D. SCHWARTZ

  	
   

  
	
   

  	
  Name:
  Howard D. Schwartz

  
	
   

  	
  Title:
  Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  VANGUARD
  CAR RENTAL USA INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  HOWARD D. SCHWARTZ

  	
   

  
	
   

  	
  Name:
  Howard D. Schwartz

  
	
   

  	
  Title:
  Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ALAMO
  RENTAL (US) INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  HOWARD D. SCHWARTZ

  	
   

  
	
   

  	
  Name:
  Howard D. Schwartz

  
	
   

  	
  Title:
  Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NATIONAL
  RENTAL (US) INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  HOWARD D SCHWARTZ

  	
   

  
	
   

  	
  Name:
  Howard D. Schwartz

  
	
   

  	
  Title:
  Senior Vice President

  

 

59

 

If
you are in agreement with the foregoing, please sign in the appropriate space
provided below and return it to the Companies, whereupon the foregoing shall
become a binding agreement among you and the Companies.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
  MADELEINE
  L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  LENARD TESSLER

  	
   

  
	
   

  	
  Name:
  Lenard Tessler

  
	
   

  	
  Title:
  Attorney-in-Fact

  

 

60

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