SETTLEMENT AGREEMENT AND EXHIBITS --------------------------------- (TENDERED FOR SIGNATURES) ------------------------- SETTLEMENT AGREEMENT -------------------- This Settlement Agreement (the "Agreement") is made this 19th day of September, 1995, by and among: (i) MARY ANNA SHOEN EATON, a married woman in her sole and separate right ("Mary Anna"); (ii) MARAN, INC. ("Maran"); (iii) EDWARD J. SHOEN ("E. Shoen"); (iv) JAMES P. SHOEN ("J. Shoen"); (v) AUBREY K. JOHNSON ("Johnson"); (vi) JOHN M. DODDS ("Dodds"); (vii) WILLIAM E. CARTY ("Carty"); and (viii) AMERCO, a Nevada corporation ("AMERCO") (collectively, the "Parties"). I. RECITALS. -------- 1.1 On August 2, 1988, Mary Anna and Maran, among others (Mary Anna, Maran and the other plaintiffs will be referred to collectively as the "Share Case Plaintiffs"), instituted an action in the Superior Court of the State of Arizona in and for Maricopa County (Case No. CV 88-20139) (the "Superior Court") against E. Shoen, J. Shoen, Johnson, Dodds, and Carty (the "Director Defendants"), and against Paul F. Shoen ("P. Shoen"), all of whom were directors of AMERCO at the time (the "Arizona Litigation"). 1.2 After a jury verdict, post-trial motions, and the entry of remittiturs which the Share Case Plaintiffs accepted, the ----------- Superior Court entered two (2) separate judgments in the Arizona Litigation. A judgment for punitive damages against E. Shoen was entered in the amount of $7,000,000.00 (the "Punitive Damage Judgment"). A judgment against the Director Defendants and P. Shoen was entered in the amount of $461,838,000.00 (the "Share Case Judgment"). The Punitive Damage Judgment and the Share Case Judgment will be collectively referred to hereinafter as the "Arizona Litigation Judgments." 1.3 Mary Anna does not own any shares of the common stock of AMERCO. 1.4 On February 21, 1995, E. Shoen filed a voluntary Chapter 11 reorganization case in the United States Bankruptcy Court for the District of Arizona (the "Court" or "Bankruptcy Court"), which was assigned Case No. 95-1430-PHX-JMM. 1.5 On February 21, 1995, J. Shoen filed a voluntary Chapter 11 reorganization case in the United States Bankruptcy Court for the District of Arizona, which was assigned Case No. 95-1431-PHX-JMM. 1.6 On February 21, 1995, Johnson filed a voluntary Chapter 11 reorganization case in the United States Bankruptcy Court for the District of Arizona, which was assigned Case No. 95-1432-PHX-CGC. 1.7 On February 21, 1995, Dodds filed a voluntary Chapter 11 reorganization case in the United States Bankruptcy Court for the District of Arizona, which was assigned Case No. 95-1433-PHX-RGM. 1.8 On February 21, 1995, Carty filed a voluntary Chapter 11 reorganization case in the United States Bankruptcy Court for the District of Arizona, which was assigned Case No. 95-1434-PHX-GBN. 1.9 Pursuant to an Order entered by the Bankruptcy Court on April 10, 1995, the Chapter 11 cases filed by E. Shoen, J. Shoen, Johnson, Dodds, and Carty (collectively, the "Debtors") are being jointly administered by the Court as Case No. 95-1430-PHX-JMM (the "Reorganization Cases"). 1.10 On March 27, 1995, E. Shoen filed a notice of appeal before the Arizona Court of Appeals regarding the Punitive Damage Judgment. 1.11 The Debtors assert that they retain unexpired appeal rights with regard to the Share Case Judgment. 1.12 The Debtors have filed plans of reorganization (collectively, including all amendments, modifications, and restatements, the "Plans") in their respective Reorganization Cases. The Bankruptcy Court has set October 2, 1995 as the deadline to file ballots voting on the Plans (the "Ballot Deadline"), and has set November 6, 1995, as the date when hearings will begin regarding confirmation of the Plans. AMERCO has agreed, under certain conditions, to fund the Plans. 1.13 Mary Anna and Maran have entered into this Agreement, and have agreed to settle their claim(s), to avoid the uncertainty of litigation and to finally resolve the many years of litigation between Mary Anna, Maran, the Director Defendants, and AMERCO. 1.14 The Parties want to terminate all past, present, and potential controversies between and among the Parties, including, but not limited to, the issues raised in the Arizona Litigation and the Arizona Litigation Judgments, and to fully and finally compromise and settle the Arizona Litigation Judgments against the Debtors, and all other claims which Mary Anna, her spouse TIMOTHY EATON ("Timothy"), and Maran (on the one hand) and the Director Defendants and AMERCO (on the other hand) have or may have against each other. II. OPERATIVE PROVISIONS. -------------------- 2.1 The Parties hereby acknowledge the accuracy of the foregoing "Recitals," which are incorporated into the "Operative -------- --------- Provisions" segment of this Agreement as though fully set forth - ---------- herein and are made a part of the "Operative Provisions" for all -------------------- purposes. SATISFACTION OF THE ARIZONA JUDGMENTS ------------------------------------- 2.2 In consideration of the promises and the mutual covenants set forth herein, the Parties stipulate and agree that on approval of this Agreement by an Order of the Bankruptcy Court in the Reorganization Cases: (a) The Director Defendants, or their designee, will pay to Mary Anna the sum of $41,352,083.20 in settlement and full satisfaction of all claims of Mary Anna against the Debtors, AMERCO, any subsidiary or affiliate of AMERCO, and any officers, directors, employees, agents, representatives, attorneys and accountants of any of the foregoing, including, but not limited to the claims of Mary Anna arising out of the Arizona Litigation Judgments, and any and all claims of Mary Anna for nondischargeability or objections to discharges against the Debtors (the "Settlement Amount"). (b) Upon payment of the Settlement Amount and the Stock Purchase Amount pursuant to the Stock Purchase Agreement, any and all claims of Mary Anna and Maran against the Debtors, arising from the Arizona Litigation Judgments or otherwise, will be deemed fully satisfied, including but not limited to, any claims which have been or may be asserted by Mary Anna or Maran (collectively or individually) in the Reorganization Cases. (c) The payments to be made pursuant to this Section 2.2 and the transfers to be effected will be made and transferred at the Closing (as hereinafter defined). 2.3 By virtue of their receipt of the foregoing amounts, and full satisfaction and settlement of their claims against the Debtors, Mary Anna and Maran will not be deemed to have cast a vote to accept or reject any of the Plans. 2.4 If this Agreement is not approved prior to the Ballot Deadline, the Ballot Deadline will be deemed automatically extended as to Mary Anna and Maran for a period of three (3) business days after the entry of the Bankruptcy Court's Order denying approval of this Agreement. 2.5 This Agreement does not impose a requirement on any of the Parties as to how they must report the proceeds described in this Agreement for federal and/or state income tax purposes. 2.6 Payment of the Settlement Amount to Mary Anna and the Stock Purchase Amount to Maran and performance of the Parties under this Agreement is not contingent upon confirmation of any of the Plans in the Reorganization Cases. APPROVALS AND CLOSING --------------------- 2.7 Promptly upon execution of this Agreement, the Debtors will execute and file with the Bankruptcy Court a Motion to Approve Stock Purchase Agreement and Settlement Agreement, along with a proposed Order Granting Motion for Approval of Stock Purchase Agreement and Settlement Agreement, and Mary Anna and Maran will separately support said motion and cooperate in any Court appearances or further filings, notices or other actions necessary to obtain the approval of this Agreement by the Bankruptcy Court. 2.8 The Parties will effectuate the transfers described in Section 2.2 above pursuant to a "Closing" which will occur on the first business day that is fourteen (14) calendar days after approval of this Agreement by the Bankruptcy Court, unless that date is voluntarily extended, in writing, by the mutual agreement of the Parties (the "Closing Date"); provided, however, subject to Sections 2.10 and 2.12 below, that in no event will the Closing Date occur later than November 6, 1995, unless the Parties mutually agree, in writing, upon a later date. Hereinafter all references to "Closing Date" will include any mutually agreed extensions for Closing beyond November 6, 1995. 2.9 Closing of the transaction contemplated by this Agreement will occur at the offices of Streich Lang, P.A., in Las Vegas, Nevada, unless otherwise mutually agreed by the Parties, and the following will occur at the Closing: (a) Maran, or its duly authorized representative, will deliver the Maran Shares duly endorsed. In the event that Maran cannot deliver stock certificates for all of the Maran Shares, Maran, or its duly authorized representative, will provide a duly executed affidavit of lost stock certificate, in the form attached hereto as Exhibit "A" and by this reference incorporated herein, at the Closing. (b) The Director Defendants, or their designee, will pay the Settlement Amount to Mary Anna and the Stock Purchase Amount (pursuant to the Stock Purchase Agreement) to Maran in cash or immediately available funds, pursuant to the respective instructions of Mary Anna and Maran, said instructions to be given three (3) days prior to the Closing Date. (c) The Releases (defined below) will become fully operative and effective without further action of the Parties and will be exchanged. SPECIFIC PERFORMANCE -------------------- 2.10 In the event that Mary Anna and Maran (or either of them) fail or refuse to perform their obligations pursuant to this Agreement, AMERCO and the Debtors will be entitled to specific performance of this Agreement, pursuant to the terms of Section 2.12 below, if each of the following has occurred: (a) the Parties have approved the final settlement documents, including this Agreement; (b) the Bankruptcy Court has approved this Agreement; and (c) the Director Defendants, or their designee, have deposited the Settlement Amount and the Stock Purchase Amount into an escrow account to be established for that purpose at at a bank, title company, or escrow company independent of the Director Defendants or their affiliates (the "Escrow Agent") for delivery to Mary Anna and Maran on or before the Closing Date. 2.11 In the event that any of the foregoing conditions is not satisfied, this Agreement and the underlying settlement will be null and void and the Parties will not be prejudiced by virtue of having entered into this Agreement. 2.12 If all of the conditions set forth in Section 2.10 above are met, AMERCO and the Debtors will be entitled to obtain an order from the Bankruptcy Court granting specific performance (the "Specific Performance Order") as follows: (a) An authorized officer of AMERCO and each of the Debtors will file a sworn affidavit (the "Non-Performance Affidavits") with the Bankruptcy Court, setting forth: (i) that the Bankruptcy Court approved this Agreement prior to the Closing Date; (ii) that the Director Defendants, or their designee, deposited the Settlement Amount and the Stock Purchase Amount with the Escrow Agent on or before the Closing Date; (iii) that the Closing was to occur on a specified date; and (iv) that Mary Anna and Maran have refused to appear (either personally or through an authorized representative) at the Closing and perform. A Motion for entry of the Specific Performance Order will accompany the Nonperformance Affidavits. (b) AMERCO and the Debtors will promptly serve notice of the Motion and copies of the Non-Performance Affidavit(s) upon Mary Anna and Maran and their counsel. (c) Mary Anna and Maran will not be entitled to file a Response to the Motion unless the Response is accompanied by a sworn affidavit alleging that the Non-Performance Affidavit(s) contain(s) false statements (collectively, the "Controverting Response"). The affidavit(s) also must specify the allegedly false statements and must state what the affiant claims to be the true facts. (d) AMERCO and the Debtors will be entitled to entry of the Specific Performance Order without a hearing on the Motion unless a Controverting Response has been filed, in which event AMERCO and the Debtors will have the right to an expedited hearing on the Motion. (e) The Bankruptcy Court will retain jurisdiction over this Agreement and the underlying settlement to enter the Specific Performance Order. (f) The Parties agree that the Bankruptcy Court administering the Reorganization Cases has in personam jurisdiction over Mary Anna and Maran. (g) Upon receipt of a certified copy of the Specific Performance Order, the Escrow Agent will release the Settlement Amount and the Stock Purchase Amount to Mary Anna and Maran, respectively, or, alternatively, act solely in reliance on their instructions as to the disposition of said funds. (h) The Specific Performance Order will specifically authorize and direct AMERCO or its stock transfer agent to transfer the Maran Shares on the books of AMERCO. (i) Upon entry of the Specific Performance Order, the Releases (defined below) will be immediately effective. RELEASES -------- 2.13 Contemporaneously with the execution of this Agreement, the Parties and Timothy have executed the respective "Releases," -------- in the forms attached hereto as Exhibits "B" and "C" and by this reference incorporated herein (the "Releases"), which will become effective on the earlier to occur of the Closing Date or entry of the Specific Performance Order. Should neither of the foregoing events occur, the Releases will be null and void. 2.14 Mary Anna represents and warrants on behalf of herself and on behalf of Maran that, notwithstanding that she is a married woman, her interest in the Share Case Judgment, the Punitive Damage Judgment, and any claims against the Debtors and AMERCO which are being released pursuant to this Agreement are her sole and separate property and sole and separate claims; and that her spouse, Timothy, has no interest in or claim to the Share Case Judgment, the Punitive Damage Judgment, any claims against the Debtors and AMERCO which are being released pursuant to this Agreement, the Settlement Amount, or the Stock Purchase Amount. Notwithstanding the foregoing, Timothy has executed, and has joined with Mary Anna and Maran in executing, the Release in favor of AMERCO and the Debtors in exchange for, and in consideration of, AMERCO's and the Debtors' inclusion of Timothy in the Release which AMERCO and the Debtors have executed in favor of Mary Anna, Timothy, and Maran. 2.15 Mary Anna, Timothy, and Maran, on behalf of themselves, and as to their claims only on behalf of any officers, directors, employees, agents, representatives, attorneys and accountants of any of them, will release the Debtors, AMERCO, any subsidiary or affiliate of AMERCO, and any officers, directors, employees, agents, representatives, attorneys and accountants of any of the foregoing, pursuant to the "Release" attached hereto as Exhibit ------- "B" contemporaneously with the execution of this Agreement, and subject to Sections 2.13 and 2.14 above. 2.16 AMERCO and the Debtors, on behalf of themselves and any officers, directors, employees, agents, representatives, attorneys and accountants of any of them, will release Mary Anna, Timothy, and Maran and any officers, directors, employees, agents, representatives, attorneys and accountants of any of them, pursuant to the "Release" attached hereto as Exhibit "C" contemporaneously ------- with the execution of this Agreement, and subject to Sections 2.13 and 2.14 above. GENERAL PROVISIONS ------------------ 2.17 The Parties hereby agree to do such acts, and to execute such documents, as may be necessary or appropriate to implement and accomplish the purposes of this Agreement and the intent of the Parties. 2.18 This Agreement, and the Bankruptcy Court Order approving this Agreement, will survive any dismissal of the Reorganization Cases, and will be fully effective and enforceable. 2.19 The Parties agree that the laws of the State of Arizona, and the provisions of the United States Bankruptcy Code, 11 U.S.C. Section Section 101 et seq., will govern and control this Agreement, ------- including, but not limited to, any documents executed pursuant to this Agreement. 2.20 No provision of this Agreement may be waived, modified, or altered, except by a writing executed by all of the Parties hereto. 2.21 Time and strict performance are of the essence of this Agreement. 2.22 This Agreement (including, but not limited to, all exhibits and release provisions) will inure to the benefit of, and will be binding on, all of the Parties and their respective heirs, assigns, representatives, and successors in interest of any kind. 2.23 The language of this Agreement has been freely and voluntarily negotiated between the Parties, each of whom has been advised and is represented by competent and effective counsel. The Parties have been fully advised of the legal effect of this Agreement and have read this Agreement in its entirety or have had it read to them. By executing this Agreement, the Parties represent and warrant to each other that each of them understands the contents of this Agreement. This Agreement is intended to be enforceable according to its written terms, and there are no promises, oral agreements, or expectations of the Parties to the contrary. 2.24 The Parties agree that this Agreement may be executed in multiple counterparts, each of which will be deemed an original document, and when all of the Parties hereto have executed one or more counterparts, all such counterparts, taken together, will constitute a single agreement. DATED this 19th day of September, 1995. AMERCO, a Nevada corporation By /S/ Gary Klinefelter ____________________ Its Secretary & General Counsel ____________________________ EDWARD J. SHOEN /S/ Edward J. Shoen ___________________ JAMES P. SHOEN /S/ James P. Shoen __________________ AUBREY K. JOHNSON /S/ Aubrey K. Johnson _____________________ JOHN M. DODDS /S/ John M. Dodds __________________ WILLIAM E. CARTY /S/ William E. Carty ____________________ MARAN, INC. By /S/ Mary Anna Shoen Eaton _________________________ Its President ____________________ MARY ANNA SHOEN EATON /S/ Mary Anna Shoen Eaton EXHIBIT "A" ----------- AFFIDAVIT FORM (LOST STOCK CERTIFICATE) --------------------------------------- AFFIDAVIT --------- I, MARY ANNA SHOEN EATON, PRESIDENT OF MARAN, INC., do hereby certify that Maran, Inc.'s share certificate: Certificate No. Company Name Number Shares --------------- ------------ ------------- 5110 AMERCO, a Nevada Corp. 3,343,076 has been lost or misplaced and after diligent search cannot be found. I hereby make this statement of lost certificate under oath in order to induce the Company to transfer Maran, Inc.'s stock ownership in AMERCO pursuant to the Stock Purchase Agreement dated September 19, 1995. Maran, Inc. hereby agrees to hold harmless and indemnify the Company for any loss occasioned by the reappearance of such certificate. MARAN, INC. DATED: ______________ By:_____________________ Mary Anna Shoen Eaton, President STATE OF ________________ COUNTY OF ________________ I, Mary Anna Shoen Eaton, President of Maran, Inc., being first duly sworn, depose and declare the foregoing to be a complete and correct statement to the best of my knowledge, information and belief. _____________________ Mary Anna Shoen Eaton Subscribed and sworn to before me this ____ day of ________________, 1995. _____________ Notary Public (Notarial Seal) EXHIBIT "B" ----------- RELEASE EXECUTED BY MARY ANNA, ------------------------------ TIMOTHY, AND MARAN ------------------ INCORPORATED BY REFERENCE TO EXHIBIT 10.5 FILED WITH THE COMPANY'S QUARTERLY REPORT OF FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1995, FILE NO. 0-7862. EXHIBIT "C" ----------- RELEASE EXECUTED BY AMERCO AND THE DEBTORS ------------------------------------------ INCORPORATED BY REFERENCE TO EXHIBIT 10.6 FILED WITH THE COMPANY'S QUARTERLY REPORT OF FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1995, FILE NO. 0-7862.