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EXHIBIT 10(ii)A
(Certain confidential portions of this Exhibit have been omitted, as indicated
by an * on the margin or in the text, and filed with the Commission)
STOCKHOLDERS AGREEMENT
STOCKHOLDERS AGREEMENT dated as of July 7, 1993, among Ford Motor
Company, a Delaware corporation ("Ford"), Park Ridge Limited
Partnership, a Delaware limited partnership (the "Partnership"), Ford
Motor Credit Company, a Delaware corporation ("FMCC"), AB Volvo, a
Swedish corporation ("Volvo"), Commerzbank Aktiengesellschaft, a bank
organized under the laws of the Federal Republic of Germany
("Commerzbank"), The Hertz Corporation, a Delaware corporation
("Hertz"), Park Ridge Corporation, a Delaware corporation ("Park
Ridge"), and the persons that become parties to this Agreement
pursuant to Paragraph 8 hereof (the "Participants").
WHEREAS, Ford, FMCC, the Partnership, Volvo and Commerzbank together
own all of the issued and outstanding capital stock of Park Ridge; and
WHEREAS, Park Ridge owns all of the issued and outstanding capital
stock of Hertz; and
WHEREAS, Park Ridge and Hertz have entered into an Agreement and Plan
of Merger pursuant to which Park Ridge will merge with and into Hertz with
Hertz as the surviving corporation (the "Merger"); and
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WHEREAS, pursuant to the Merger the holders of capital stock of Park
Ridge will become holders of capital stock of Hertz; and
WHEREAS, Ford, FMCC, the Partnership, Volvo, Commerzbank and Park
Ridge are parties to a Stockholders Agreement dated as of December 30, 1987, as
amended as of July 27, 1988 (the "Park Ridge Stockholders Agreement"); and
WHEREAS, the parties hereto desire to confirm in writing the terms of
the understanding among them with respect to Hertz upon and following the
Merger.
NOW, THEREFORE, in consideration of the premises and of the
representations, warranties, covenants, agreements and conditions contained
herein, the parties hereto agree as follows:
1. Definitions.
As used herein the following terms have the following respective
meanings:
"Adjusted Rate" means *
*
*
*
*
"Affiliate" means, with respect to any company or corporation, any
director, officer or employee of such
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company or corporation directly or indirectly controlling or controlled by or
under direct or indirect common control with such individual, company or
corporation.
"Agreement" means this Stockholders Agreement.
"Class A Stock" means the Class A Common Stock described in Paragraph
2.1(d) hereof.
"Class A Stock Initial Share" has the meaning set forth in Paragraph
6.1(b)(ii) hereof.
"Class B Stock" means the Class B Common Stock described in Paragraph
2.1(e) hereof.
"Class C Stock" means the Class C Common Stock described in Paragraph
2.1(f) hereof.
"Classified Stock" means Class A Stock, Class B Stock and Class C
Stock.
"Closing" has the meaning assigned to it in the Park Ridge
Stockholders Agreement.
"Commission" has the meaning set forth in Paragraph 4.1(a) hereof.
"Distribution Date" has the meaning set forth in Paragraph 6.1(b)
hereof.
"Equity Securities" means Classified Stock or New Common Stock or any
evidence of indebtedness, shares of capital stock (other than Classified Stock
or New Common Stock) or other securities convertible into, exchangeable
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for or giving the holder thereof the right to acquire shares of Classified
Stock or New Common Stock.
"Escrow" has the meaning set forth in Paragraph 4.1(b) hereof.
"Forfeitable Shares" has the meaning set forth in Paragraph 5.1(a)
hereof.
"IPO" has the meaning set forth in Paragraph 4.1(b) hereof.
"Market Price" has the meaning set forth in Paragraph 4.1(e) hereof.
"New Common Stock" means the Common Stock described in Paragraph
2.1(g) hereof.
"Participants" has the meaning set forth in paragraph 8 hereof.
"Partnership Note" means the promissory note of the partnership
substantially in the form of Attachment IIA hereto.
"Preferred Stock" means Series A Preferred and Series B Preferred.
"Preferred/B & C Minimum" has the meaning set forth in Paragraph
6.l(b)(i) hereof.
"Pricing Date" has the meaning set forth in Paragraph 4.1(e) hereof.
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"Primary Shares" has the meaning set forth in Paragraph 4.1(b) hereof.
"Public Company" means Hertz or its successor at any time after it has
registered any of its Equity Securities under Section 5 of the Securities Act
of 1933.
"Residual Shares" has the meaning set forth in Paragraph 6.1(a) hereof.
"Secondary Shares" has the meaning set forth in Paragraph 4.l(b)(ii)
hereof.
"Series A Preferred" means the Series A Preferred Stock described in
Paragraph 2.1(b) hereof.
"Series B Preferred" means the Series B Preferred Stock described in
Paragraph 2.1(c) hereof.
"Stockholders" means the stockholders of Hertz (including
Participants) who are or become parties to this Agreement.
"Total Stockholder Value" has the meaning set forth in Paragraph
6.1(a) hereof.
2. Merger.
2.1(a) Amendment of Certificate of Incorporation. Effective upon
consummation of the Merger, the Certificate of Incorporation of Hertz will
provide for the following classes of capital stock, containing the terms and
provisions described below, as more fully set forth in the
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form of Restated Certificate of Incorporation (the "Restated Charter") attached
as Attachment I hereto.
(b) Series A Preferred Stock. The Series A Preferred has a total par
value of $450 million, consists of 4,500,000 shares of the par value of $100
each and shall be entitled, when, as and if declared by the Board of Directors
of Hertz, to cumulative annual dividends, but payable only out of funds legally
available therefor, compounded annually (if in arrears). The annual dividend
rate through December 31, 1998 shall be 10% and commencing January 1, 1999 the
annual dividend rate shall be the Adjusted Rate which shall be reset once
annually as of each succeeding January 1. Each share of Series A Preferred
issued pursuant to the Merger shall, upon such issuance, be entitled to
receive, when and as declared by the Board of Directors of Hertz out of funds
legally available for the payment of dividends, cumulative cash dividends equal
to the amount of cash dividends accrued but not declared and paid on a share of
10% Cumulative Series A Preferred Stock, par value $100 per share, of Park
Ridge at the time of the Merger. The Series A Preferred shall be redeemable by
its terms at the option of Hertz at any time. The Series A Preferred shall not
have any voting rights, except that it shall have the right to
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elect two directors in the event of a default as provided in the Restated
Charter.
(c) Series B Preferred Stock. The Series B Preferred has a total par
value of $100 million, consists of 1,000,000 shares of the par value of $100
each and shall be entitled, when, as and if declared by the Board of Directors
of Hertz, to cumulative annual dividends, but payable only out of funds legally
available therefor, compounded annually (if in arrears). The annual dividend
rate through December 31, 1998 shall be the applicable rates specified in
Attachment II hereto under the column entitled "Variable Rate" and commencing
January 1, 1999 shall be the Adjusted Rate which shall be reset once annually
as of each succeeding January 1. Each share of Series B Preferred issued
pursuant to the Merger shall, upon such issuance, be entitled to receive, when
and as declared by the Board of Directors of Hertz out of funds legally
available for the payment of dividends, cumulative cash dividends equal to the
amount of cash dividends accrued but not declared and paid on a share of
Variable Rate Cumulative Series B Preferred Stock, par value $100 per share, of
Park Ridge at the time of the Merger. The Series B Preferred shall be
redeemable by its terms at the option of Hertz at any time. The Series B
Preferred shall not have any voting rights; provided,
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however, that if Hertz (x) shall have a net operating loss for Federal tax
purposes for any taxable year and (y) forecast in good faith that it also
expects to have significant and continuing net operating losses for Federal tax
purposes, the Stockholders shall, at Ford's request, take all necessary action
to provide Ford, as the holder of the Series B Preferred, with sufficient
voting rights, when added to the voting rights of the Class C Stock, to permit
Ford to consolidate Hertz for Federal tax purposes in a succeeding period which
shall not be less than 60 months in duration; and provided, further, that if
Ford shall have so consolidated Hertz and Hertz shall after such consolidation
period (x) have gross income in excess of deductions for Federal tax purposes
for any taxable year and (y) forecast in good faith that it also expects to
have gross income in excess of deductions for the taxable year immediately
following such taxable year, the Stockholders shall, at the request of Hertz,
take all necessary action to eliminate the voting rights of the Series B
Preferred; and such voting rights shall be subject to reinstatement, in the
event of such a net operating loss for any subsequent taxable year, in
accordance with the first proviso in this sentence but not earlier than the
first day of the 61st month beginning after the commencement of Hertz' first
taxable year in which
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it ceased to be a member of Ford's affiliated group or such earlier date as of
which Ford is legally entitled to file a Federal consolidated income tax return
that includes Hertz. The Stockholders presently anticipate that such tax
consolidation will not be effected in circumstances such that Hertz has such a
loss for tax purposes but has profits for book purposes. For any year when
Ford shall consolidate Hertz for Federal income tax purposes, Ford and Hertz
shall agree upon a tax sharing agreement which shall appropriately reflect the
value of current losses or other tax benefits to Ford as compared to the value
to Hertz. If Ford and Hertz are unable to agree upon such a tax sharing
agreement, the terms thereof shall be referred to and decided by a panel of
three arbitrators appointed by the American Arbitration Association, and a
decision of a majority of such arbitrators shall be binding on the parties in a
court of law. As to other tax matters, it is agreed that if with respect to
the Class A Stock (or the New Common Stock issued in exchange therefor), Hertz
or any of its affiliates actually receives a deduction for Federal, state or
local income tax purposes, Hertz or such affiliate shall pay to the Partnership
an amount such that, after taking into account the tax benefit actually
received by Hertz or such affiliate as a result of such deduction (and the
deduction
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of payment pursuant to this sentence), Hertz is in no worse an after-tax
position than if no such deduction were allowable. It is further agreed that
if with respect to the Series A Preferred, the Series B Preferred or the Class
C Stock (or the New Common Stock issued in exchange therefor), Hertz or any of
its affiliates actually receives a deduction for Federal, state or local income
tax purposes, Hertz or such affiliate shall pay to Ford an amount such that,
after taking into account the tax benefit actually received by Hertz or such
affiliate as a result of such deduction (and the deduction of payment pursuant
to this sentence), Hertz is in no worse an after-tax position than if no such
deduction were allowable.
(d) Class A Common Stock. The Class A Stock has one vote per share
and no special preferences.
(e) Class B Common Stock. The Class B Stock has one vote per share
and no special preferences.
(f) Class C Common Stock. The Class C Stock has one vote per
share and shall have the right to designate four directors, until such time as
fewer than 40 shares thereof (adjusted for stock splits and the like as
provided in the Restated Charter) shall be outstanding; provided, however, that
the Class C Stock shall in any event have 40% of the general voting power and
the right to elect not less
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than 40% of the members of such Board of Directors, until such time as fewer
than 40 shares thereof (as so adjusted) shall be outstanding. The Class C
Stock shall be convertible into Class B Stock on a share for share basis at any
time at the holder's option. The 40 shares of Class C Stock retained by Ford
pursuant to paragraph 4.l(b)(i) hereof also shall be convertible into shares of
New Common Stock at the holder's option, using the same conversion ratio as was
applied under Paragraph 4.l(b)(i) for exchanging New Common Stock for Class C
Stock.
(g) New Common Stock. *
*
*
*
*
2.2 [Reserved].
2.3 Refinancing. It is anticipated that from time to time Hertz will
refinance a portion of its indebtedness and at a future date might possibly
decide also to refinance its obligations with respect to the Preferred Stock.
Subject to the limitations provided in agreements, instruments and documents
governing or evidencing indebtedness of Hertz, the net proceeds of any such
Preferred Stock refinancing which are not paid to third
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parties shall be applied pro rata to the repurchase or redemption of
outstanding shares of the Preferred Stock or to the pro rata payment of
dividend arrearages thereon (if declared by the Board of Directors of Hertz and
if funds are legally available therefor). Any such payment (and any payment by
Park Ridge pursuant to Section 2.3 of the Park Ridge Stockholders Agreement)
shall have the effect of reducing the Preferred/B & C Minimum as provided in
Paragraph 6.1(b)(i) hereof. Preferred Stock shall not be repurchased or
redeemed by Hertz, without the consent of the holder of the Class A Stock, from
funds which have a higher cost to Hertz than the before-tax equivalent cost of
the Preferred Stock being so repurchased or redeemed.
3. Corporate Governance.
3.1 Board of Directors. (a) Upon effectiveness of the Merger,
the Board of Directors of Hertz shall consist of nine members and thereafter
may be increased to provide appropriate representation on the Board of
Directors of the Stockholders.
(b) The Stockholders shall vote the shares of Classified Stock
owned by them so as to elect two directors designated by the Partnership as
owner of the Class A Stock, for so long as the Partnership shall own at least
200 shares of Class A Stock.
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(c) The Stockholders shall vote the shares of Classified Stock owned
by them so as to provide the same representation on the Board of Directors to
any holder of 200 or more shares of the Class B Stock as the representation
provided to the Partnership as owner of the Class A Stock.
(d) The Class C Stock (held by Ford) shall have the right to
designate directors as provided in paragraph 2.1(f) hereof.
(e) No director shall be removed, except for cause, without the
consent of the party that designated such director; provided, however, that, if
the Board of Directors of Hertz determines that it would be in the best
interest of Hertz to replace a director, the Stockholders shall replace the
director with a person designated by the party which has designated the
director being removed. If any vacancy should occur through death, resignation
or removal of a director, the party which designated such director shall be
entitled to designate his replacement.
(f) The Stockholders shall vote their shares of Classified Stock
to achieve the Board representation called for by this Paragraph 3. If at any
meeting of the Board of Directors of Hertz any of the directors representing
the party entitled to designate the majority of the directors
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shall not be present, the other party or parties shall use their best efforts
to the end that a sufficient number of directors representing them abstain so
that if any party designated the majority of the directors, such party may be
able to cast a majority of the votes cast.
3.2 Approval Rights of Directors. None of the actions listed in
Attachment III to this Agreement may be taken by Hertz without the approval or
favorable recommendation of at least * of the members of the Board of
Directors of Hertz, and none of the actions marked with an * in
Attachment III hereto may be taken unless there is included in such * at
least one of the members designated by the holder or holders of the Class *
Stock.
3.3 Audit Committee. The Board of Directors of Hertz shall at all
times have an Audit Committee thereof consisting of at least two members of the
Board of Directors none of which is an officer of Hertz. Such Committee shall
have such duties and responsibilities as may be delegated to it by the Board of
Directors of Hertz.
3.4 Certain Transactions. Each Stockholder agrees to conduct its
various transactions with Hertz in accordance with the requirements of Delaware
corporate law and in a manner designed to avoid any substantial adverse
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effect on the Partnership as a minority stockholder of Hertz or on any other
Stockholder.
4. Initial Public Offering.
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7. Supply Contract and Joint Advertising Agreement.
Immediately after the Closing, Hertz entered into a Supply
Contract and a Joint Advertising Agreement with Ford in the form of Attachments
VI and VII, respectively, to this Amended Agreement.
8. *
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9. Transfer Restrictions.
No Stockholder shall have any right to sell or dispose of any
Preferred Stock, Classified Stock or New Common Stock or any interest therein
at any time (whether before or after an IPO) except as expressly permitted by
this Agreement.
10. Legends on Certificates.
All of the stock certificates representing outstanding shares
of Preferred Stock, Classified Stock or New Common Stock shall bear legends
referring to the restrictions provided for under this Agreement and to the
unregistered status under the Securities Act of 1933 of the shares represented
thereby as follows:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933 and may not be transferred
in the absence of such registration or an exemption therefrom under
such Act. Such shares are subject to restrictions on transfer and
other conditions, as specified in a certain Stockholders Agreement, a
complete and correct copy of which is available for inspection at the
principal office of The Hertz Corporation, and will be furnished to
the owner of such shares upon written request and without charge."
11. Accounting; Financial Statements and Other
Information.
11.1 Accounting. Hertz shall maintain a system of accounting
and internal control established and administered to ensure that financial
statements of Hertz and its subsidiaries are prepared in accordance with
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generally accepted accounting principles and will set aside on its books all
such proper reserves as shall be required by generally accepted accounting
principles.
11.2 Financial Statements and Other Information. Until Hertz
is a Public Company, it shall deliver to each Stockholder:
(a) within 45 days after the end of each of the first
three quarterly fiscal periods in each fiscal year of
Hertz, consolidated Balance Sheets of Hertz and its
subsidiaries as at the end of such period and the
related consolidated statements of income,
stockholders' equity and changes in financial
position of Hertz and such subsidiaries for such
period and (in the case of the second and third
quarterly periods) for the period from the beginning
of the current fiscal year to the end of such
quarterly period, setting forth in each case in
comparative form the consolidated figures for the
corresponding periods of the previous fiscal year, in
such detail as for statements presently prepared by
Hertz and certified by the principal financial
officer of Hertz;
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(b) within 90 days after the end of each fiscal year of
Hertz, consolidated Balance Sheets of Hertz and its
subsidiaries as at the end of such year and the
related consolidated statements of income,
stockholders' equity and changes in financial
position of Hertz and such subsidiaries for such
fiscal year, setting forth in each case in
comparative form the consolidated figures for the
previous fiscal year, all in reasonable detail; and
(i) in the case of such consolidated financial
statements, accompanied by a report thereon
of Hertz' independent certified public
accountants, which report shall state that
such consolidated financial statements
present fairly the financial position of
Hertz and such subsidiaries as at the dates
indicated and the results of their operations
and changes in their financial position for
the periods indicated in conformity with
generally accepted accounting principles
applied
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on a basis consistent with prior years
(except as otherwise specified in such
report) and that the audit by such
accountants in connection with such
consolidated financial statements has been
made in accordance with generally accepted
auditing standards; and
(ii) notwithstanding the 45-day and 90-day time
periods specified in subparagraphs (a) and
(b) above, financial statements and where
applicable the audits and/or reviews thereof
shall be furnished to Ford in sufficient time
to permit Ford to meet its own internal
requirements for financial reporting.
(c) promptly upon receipt thereof, copies of all reports
submitted to Hertz by independent certified public
accountants in connection with each annual, interim
or (at the request of Ford, based on a list of
special audits prepared by Hertz) special audit of
the books of Hertz or any subsidiary made by such
accountants, including, without limitation, the
comment letter submitted by such
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accountants to management in connection with their
annual audit, provided that the reports referred to
in this subparagraph (c) need not be delivered to any
Stockholder owning less than l0% of the outstanding
shares of Classified Stock;
(d) promptly upon their becoming available, copies of all
registration statements and prospectuses filed by
Hertz or any subsidiary with any securities exchange
or with the Commission and all press releases and
other statements made available generally by Hertz or
any subsidiary to the public concerning material
developments in the business of Hertz or its
subsidiaries; and
(e) with reasonable promptness, such other information
and data with respect to Hertz or any of its
subsidiaries as from time to time may be reasonably
requested.
11.3 Inspection; Confidentiality. So long as Hertz is not a
Public Company, it will permit any authorized representatives designated by
Ford, the Partnership or any Stockholder owning at least 200 shares of
Classified Stock, without expense to Hertz, to visit and inspect any of the
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properties of Hertz or its subsidiaries, including its and their books of
account, and to make copies and take extracts therefrom, and to discuss its and
their affairs, finances and accounts with its and their officers and
independent certified public accountants, all at such reasonable times and as
often as may be reasonably requested. Without the prior consent of Hertz, such
Stockholders will not disclose (other than to their employees, auditors or
counsel or to other holders of 200 or more shares of Classified Stock) any
confidential or proprietary information with respect to Hertz or any subsidiary
which is furnished or to which such Stockholders have access pursuant to this
Paragraph 11.3, at Board of Directors' meetings or otherwise pursuant to this
Agreement, provided that any such Stockholder may disclose any such information
(a) that has become generally available to the public, (b) as may be required
or appropriate in response to any summons or subpoena or in connection with any
litigation and (c) to comply with any law, order, regulation or ruling
applicable to it.
12. *
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13. General provisions.
13.1 Non-Waiver of Rights.
(a) Any party to this Agreement may waive any right,
breach or default which such party has the right to
waive, provided that such waiver shall not be
effective against the waiving party unless it is in
writing, is signed by such party and specifically
refers to this Agreement. Waivers may be made in
advance or after the right waived has arisen or the
breach or default waived has occurred. Any
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waiver may be conditional. No waiver of any breach
of any agreement or provision herein contained shall
be deemed a waiver of any preceding or succeeding
breach thereof or of any other agreement or provision
herein contained. No waiver or extension of time for
performance of any obligations or acts shall be
deemed a waiver or extension of the time for
performance of any other obligations or acts.
(b) Failure of any party hereto to enforce any of the
provisions of this Agreement or any right with
respect thereto or failure to exercise any election
provided for herein shall in no way be considered a
waiver of such provision, right or election, or in
any way to affect the validity of this Agreement.
The failure of any party hereto to enforce any of
such provisions, rights or elections shall not
preclude or prejudice such party from later enforcing
or exercising the same or other provisions or
elections which it may have under this Agreement.
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13.2 Entire Agreement. This Agreement, together with the
Attachments, sets forth the entire understanding of the parties hereto with
respect to the matters covered herein, and supersedes all prior agreements,
covenants, arrangements and communications, whether oral or written, relating
to such matters including, without limitation, the Park Ridge Stockholders
Agreement.
13.3 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, and each of
which shall constitute one and the same Agreement.
13.4 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
13.5 Severability. This Agreement is intended to be valid
and effective throughout the world and, to the extent permissible under
applicable law, shall be construed in a manner to avoid violation of or
invalidity under the laws of any applicable jurisdiction. Should any provision
of this Agreement nevertheless be or become invalid, illegal or unenforceable
under any such laws, the other provisions of this Agreement shall not be
affected, and, to the extent permissible under applicable law, the parties
hereto will
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use their best efforts to modify said invalid, illegal or unenforceable
provisions so as to comply with such laws.
13.6 Notices. All notices, requests, consents, approvals,
waivers and other communications hereunder shall be in writing and shall be
delivered by hand or sent by registered mail, postage prepaid or by telex or
facsimile transmission, addressed as follows, and shall be effective upon
receipt:
If to Ford, to:
Ford Motor Company
The American Road
Dearborn, Michigan 48121
Attention of: The Secretary
If to FMCC, to:
Ford Motor Credit Company
The American Road
Dearborn, Michigan 48121
Attention of: The Secretary
If to the Partnership, to:
Park Ridge Limited Partnership
c/o Frank Olson
366 Mountain Avenue
Ridgewood, New Jersey 07450
If to Volvo, to:
AB Volvo
c/o Volvo North America Corporation
535 Madison Avenue
New York, New York 10022
Attention of: Mr. Albert Dowden
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If to Commerzbank, to:
Commerzbank Aktiengesellschaft
Neue Mainzer Strasse 32-36
6000 Frankfurt/M.1
Federal Republic of Germany
Attention of: Mr. Jurgen Reimnitz
If to Park Ridge, to:
Park Ridge Corporation
225 Brae Boulevard
Park Ridge, New Jersey 07656
Attention of: Assistant Secretary
If to Hertz, to:
The Hertz Corporation
225 Brae Boulevard
Park Ridge, New Jersey 07656
Attention of: Assistant Secretary
If to any other Stockholder, to such address as such
Stockholder shall furnish to the other Stockholders; provided, however, that if
any party hereto shall have designated a different address by notice to the
others, then to the last address so designated.
13.7 Effectiveness; Termination. This Agreement shall become
effective upon the effectiveness of the Merger. The Park Ridge Stockholders
Agreement shall terminate upon the effectiveness of this Agreement. This
Agreement shall terminate upon:
(a) The bankruptcy, liquidation or dissolution of Hertz;
provided, however, that a proceeding under Chapter 11
of the Federal Bankruptcy
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Code shall not be regarded as "bankruptcy" for
purposes of this Paragraph 13.7(a).
(b) *
*
(c) *
*
13.8 Survival. All representations, warranties,
covenants and agreements made by the parties to this Agreement shall survive
the execution of this Agreement and any investigations made by or on behalf of
the parties. All statements as to factual matters contained in any certificate
or other instrument delivered by or on behalf of any Stockholder pursuant
hereto or in connection with the transactions contemplated hereby shall be
deemed to be representations and warranties by such Stockholder hereunder as of
the date of such certificate of instrument.
13.9 Modifications and Amendments. No amendment,
modification, waiver or termination of this Agreement shall be binding unless
executed in writing by the parties hereto.
13.10 Successors and Assigns. This Agreement and the
provisions hereof shall be binding upon and shall inure to the benefit of each
of the parties and their respective permitted successors and assigns.
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13.11 Assignment. This Agreement and the rights, duties and
obligations hereunder may not be assigned or delegated by any party without the
prior written consent of the other parties; provided, however, that any
Stockholder other than the Partnership shall have the right to assign all or
part of its rights and obligations hereunder, together with the shares of stock
of Hertz owned by such Stockholder, to one or more of its Affiliates. Any
non-permitted assignment or delegation of rights, duties or obligations
hereunder made without the prior written
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consent of the other parties hereto shall be void and of no effect.
13.12 Specific Performance. The parties hereto stipulate
that the remedies at law in the event of any default by a party in performing
its obligations hereunder are not and will not be adequate and that, to the
extent permitted by applicable law, the provisions of this Agreement may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the
provisions hereof or otherwise.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of July 7, 1993.
FORD MOTOR COMPANY
By:
--------------------------
Its:
--------------
FORD MOTOR CREDIT COMPANY
By:
--------------------------
Its:
--------------
PARK RIDGE LIMITED PARTNERSHIP
By:
-----------------------------
Its:
--------------
AB VOLVO
By:
--------------------------
Its:
--------------
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COMMERZBANK AKTIENGESELLSCHAFT
By:
--------------------------
Its:
---------------
PARK RIDGE CORPORATION
By:
--------------------------
Its:
---------------
THE HERTZ CORPORATION
By:
--------------------------
Its:
---------------
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Attachments to Stockholders Agreement
I. Certificate of Incorporation
II. Computation of dividend rate applicable to Series B
preferred Stock
IIA. - Partnership Note
III. Actions requiring approval or recommendation of Board
of Directors
IV. *
V. (a) Projected Profits, 1988-1992
*
VI. Supply Contract
VII. Joint Advertising Agreement
VIII. *
2845H
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ATTACHMENT I
RESTATED CERTIFICATE OF INCORPORATION
OF THE HERTZ CORPORATION
This document was filed as Exhibit 3(i) to The Hertz Corporation's
report on Form 8-K dated July 20, 1993 (File No. 1- 7541), and is
incorporated herein by this reference.
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ATTACHMENT II
Series B Preferred Stock
ANNUAL DIVIDEND RATES
Series B Preferred
Preferred Stock ---------------------
--------------------------- Common Annual Variable
Series A Series B Stock Total Dividends Rate
-------- -------- ----- ----- --------- ----
(Mils.) (Mils.) (Mils.) (Mils.) (Mils.) (Pct.)
Investment *
Investment And
- --------------
Accumulated Dividends
---------------------
1993 * 4.66
1994 * 4.05
1995 * 3.39
1996 * 2.68
1997 * 1.89
1998 * 1.01
The amounts shown above are based on the assumption that Ford owns
* shares of Series A Preferred. If such numbers of shares owned by Ford
shall be increased or reduced, such amounts shall be appropriately adjusted to
provide an * compound annual return on the total Ford investment.
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[CS&M Ref. No.--6465-001]
ATTACHMENT II-A
10% SECURED PROMISSORY NOTE
$18,500,000
December 10, 1987
New York, New York
FOR VALUE RECEIVED, PARK RIDGE LIMITED PARTNERSHIP, a
Delaware limited partnership (the "Partnership"), hereby promises to pay to
PARK RIDGE CORPORATION, a Delaware corporation (the "Company"), at the office
of Morgan Guaranty Trust Company of New York at 23 Wall Street, New York, New
York or such other office as the Company shall designate by notice to the
Partnership, in lawful money of the United States of America, the principal sum
of $18,500,000 plus interest from the date set forth above on the unpaid
principal amount hereof at the rate of 10% per annum and compounded on an
annual basis. All interest accrued hereunder shall be calculated on the basis
of actual days elapsed in a year of 365/366 days.
*
*
*
*
*
*
*
*
*
*
*
*
*
*
*
*
*
*
This Note is secured by a pledge of 200 shares of Class A
Stock of the Company and the Partnership hereby grants a lien on such shares to
the Company. This Note can be assigned or transferred only with the consent of
the Partnership.
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2
In the event:
(i) the Partnership shall default in its payment obligations
hereunder for a period of five business days after notice thereof from
the Company;
(ii) any action shall be taken to dissolve or terminate the
existence of the Partnership or to distribute the Designated Assets to
any person other than for value; or
(iii) the Partnership shall generally not pay debts as such
debts become due, or shall admit in writing an inability to pay debts
generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against the
Partnership seeking an order for relief or to adjudicate it a bankrupt
or insolvent, or seeking liquidation, or 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 appointment of a
receiver, trustee or similar official for it or for any substantial
part of its property, provided that, in the case of a proceeding
against the Partnership, such proceeding shall continue undismissed
for 60 days or an order or decree approving or ordering the protection
sought shall continue unstayed and in effect for 60 days;
then, and in every such event and at any time thereafter during the continuance
of such event, this Note shall forthwith become due and payable, both as to
principal and interest, without presentment, demand, protest or notice of any
kind, all of which are hereby expressly waived, anything contained herein to
the contrary notwithstanding.
*
*
*
*
*
*
*
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3
This Note shall be construed in accordance with and governed
by the laws of the State of New York and any applicable laws of the United
States of America.
PARK RIDGE LIMITED PARTNERSHIP,
by
-------------------------
Frank A. Olson as
General Partner
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ATTACHMENT III
Actions Requiring Approval or Recommendation of
Hertz Board of Directors
*- Proposed material amendments to the Certificate of Incorporation, By-Laws, or similar documents of Hertz
*- Significant changes in vehicle supply agreements (other than changes relating to acquisition of fleet or fleet size)
- Purchase or sale of real property when the transaction exceeds *
- Other capital spending transactions when the expenditure exceeds *
*- Proposed sales of Hertz-owned stores which have average annual fleets of * or more units
*- Mergers, acquisitions, and divestitures (other than divestitures of Hertz-owned stores) by Hertz when the transaction
exceeds *
*- Proposed dividend actions by Hertz and its subsidiaries that deviate significantly from the annual dividend plan submitted
to the Board
- Proposed material changes in outside auditing arrangements
*- Proposed material changes in accounting or financial reporting policies or practices
- Annual business plans and budget proposals
- Borrowings and guarantees that exceed Board approved limits, proposed changes in bank credit lines outside of Hertz'
customary banking group; or changes in commercial or investment bank relationships
*
*
*
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2
*- Approval of personnel appointments and incentive compensation, stock options, and bonus awards, for senior management
employees
- Settlement of claims involving litigation or the threat of litigation or that are not in the ordinary course of business
and tax settlements if the amount to be paid or the reduction from the amount claimed exceeds
*
*- Substantive changes in compensation, benefit and incentive compensation plans
- Any changes to the Hertz Code of Conduct and matters that call for review or approval under the Code of Conduct for
employees who are officers of Hertz
*- Employment and termination agreements affecting senior management employees
*- Significant matters relating to Hertz pension funds
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ATTACHMENT IV
*
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*
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ATTACHMENT V
PARK RIDGE PERFORMANCE NET INCOME*
Performance Net Income Measures
---------------------------------------------------------
Hertz Operating Company 90% Annual and
----------------------------------------- 80% Cumulative 100% Cumulative
Profit Before Taxes on Net -------------------------- ------------------------
Taxes Income Income Annual Cumulative 1988-1990 1988-1992
------- -------- ------ ------ ---------- --------- ---------
(Mils.) (Mils.) (Mils.) (Mils.) (Mils.) (Mils.) (Mils.)
1988 *
1989 *
1990 *
1991 *
1992 *
- --------
*
*
DEFINITIONS
*
*
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*
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*
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ATTACHMENT VI
AGREEMENT DATED JANUARY 1, 1988
BETWEEN THE HERTZ CORPORATION AND FORD MOTOR COMPANY
This document was filed as Exhibit (10)(ii)(B)(a) to The Hertz
Corporation's report on Form 10-K for the year ended December 31, 1987
(File No. 1-7541), and is incorporated herein by this reference.
Portions of this Exhibit were omitted and granted confidential
treatment under Rule 24b-2.
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ATTACHMENT VII
AGREEMENT DATED JANUARY 1, 1988
BETWEEN HERTZ SYSTEM, INC. AND FORD MOTOR COMPANY
This document was filed as Exhibit (10)(ii)(B)(b) to The Hertz
Corporation's report on Form 10-K for the year ended December 31, 1987
(File No. 1-7541), and is incorporated herein by this reference.
Portions of this Exhibit were omitted and granted confidential
treatment under Rule 24b-2.
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ATTACHMENT VIII
*
*
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