Exhibit 4.59
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
)
In re: ) Chapter 11
)
ANC RENTAL CORPORATION, et al., ) Case No. 01--11200 (MFW)
) (Jointly Administered)
Debtors. )
)
ORDER PURSUANT TO SECTIONS 105, 363, 364 AND 365 OF
THE BANKRUPTCY CODE AND BANKRUPTCY RULES 4001, 6004
AND 9019 APPROVING SETTLEMENT OF DISPUTES BETWEEN
THE DEBTORS AND LIBERTY MUTUAL INSURANCE COMPANY
AND PROVIDING, INTER ALIA, FOR THE DEBTORS TO
OBTAIN POST-PETITION SURETY BONDING AND RELATED
RELIEF
Upon the motion (the "Motion") of the above-captioned debtors and
debtors-in-possession (collectively the "Debtors")(1) for the entry of an order
pursuant to sections 105, 363, 364 and 365 of title 11 of the United States Code
(the "Bankruptcy Code") and Bankruptcy Rule 9019 approving a settlement of
disputes between the Debtors and Liberty Mutual Insurance Company ("Liberty"),
set forth in the term sheet attached hereto (the "Term Sheet"), which
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(1) The Debtors are the following entities: ANC Rental Corporation, Alamo
International Sales, Inc., Alamo Rent-A-Car (Canada), Inc., Alamo Rent-A-Car
Management, LP, Alamo Rent-A-Car, LLC, ANC Aviation, Inc., ANC Collector
Corporation, ANC Financial Corporation, ANC Financial GP Corporation, ANC
Financial Properties LLC, ANC Financial, LP, ANC-GP, Inc., ANC Information
Technology, Inc., ANC Information Technology Holding, Inc., ANC Information
Technology, L.P., ANC IT Collector Corporation, ANC Management Services
Corporation, ANC Management Services, LP, ANC Payroll Administration, LLC,
ANC-TM Management LP, ARC-GP, Inc., ARC-TM Properties LLC, ARG Reservation
Services, LLC, ARI Fleet Services, Inc., Auto Rental Inc., Car Rental Claims,
Inc., Claims Management Center, Inc., Guy Salmon USA, Inc., Liability
Management Companies Holding, Inc., National Car Rental Licensing, Inc.,
National Car Rental System, Inc., NCR Affiliate Servicer Properties LLC, NCR
Affiliate Servicer, Inc., NCRAS Management, LP, NCRAS-GP, Inc., NCRS Insurance
Agency, Inc., Post Retirement Liability Management, Inc., Rental Liability
Management Holdings, LLC, Rental Liability Management, Inc., Republic
Fiduciary, Inc., Republic Guy Salmon Partner, Inc., Spirit Leasing, Inc.,
Spirit Rent-A-Car, Inc., SRAC Management, LP, SRAC-GP, Inc., and SRAC-TM, Inc.
provides for the global settlement and compromise of a number of disputes that
is essential to the Debtors' successful reorganization, including, inter alia,
for (i) the Debtors to obtain post-petition surety bonding; (ii) Liberty's
agreement to renew, replace, reinstate and/or continue certain bonds that have
been issued on behalf of the Debtors; (iii) Liberty's agreement to refrain from
canceling or voiding certain surety bonds issued on behalf of the Debtors so
long as no Event of Default (as such term is defined in the Term Sheet) has
occurred; (iv) the Debtors' assumption of (a) all surety bonds issued by
Liberty for the benefit of the Debtors that were, are or shall be outstanding
and in effect at any time during the period following November 13, 2001; and
(b) the Liberty Indemnity Agreements (as defined in the Motion), (v) additional
collateral and super-priority administrative expense status to be provided to
Liberty in connection with the issuance and continuation of surety bonds, (vi)
an acknowledgement of the extent, validity and unavoidability of certain
pre-petition payments and grants of security interest; and (vii) related
relief;
And it appearing that the Court has jurisdiction over this matter
pursuant to 28 U.S.C. ss. 157(b)(2) and 1334 and that this is a core proceeding
pursuant to 28 U.S.C. ss. 157(b)(2)(A);
And the Court having conducted a hearing on the Motion on March 13,
2002 (the "Hearing");
And the Court having determined that granting the relief requested in
the Motion is in the best interests of the Debtors, their estates and their
creditors;
And notice of the Motion having been given to (i) the Office of The
United States Trustee; (ii) counsel for Congress Financial Corporation, as
agent for the lenders under the Borrowing Base Facility; (iii) counsel for
Lehman Brothers, Inc., as agent for the lenders under the Term Loan and Senior
Loan Agreement; (v) counsel for Liberty; (vi) counsel for the Official
Committee of Unsecured Creditors; and (vii) all other parties who have
requested service in these chapter 11 cases;
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And it appearing that no other or further notice need be
given;
And good and sufficient cause appearing therefore;
IT IS HEREBY ORDERED, FOUND, DETERMINED AND DECREED, that:
1. This Court has jurisdiction over the relief sought in the
Motion, and the relief provided for herein, pursuant to 28 U.S.C. ss. 1334 and
this is a "core proceeding" as defined in and pursuant to 28 U.S.C. ss.
157(b)(2)(A), (D), (K), (M) and (O).
2. All capitalized terms not otherwise defined herein shall have
the meaning ascribed to such terms in the Term Sheet.
3. Good, adequate and sufficient cause has been shown to justify
the granting of the relief requested herein.
4. Pursuant to 11 U.S.C. ss. ss. 105, 363, 364 and 365 and
Bankruptcy Rule 9019, the Motion be, and hereby is, authorized and approved in
all respects.
5. The terms, conditions, agreements and provisions set forth in
the Term Sheet are incorporated into this Order by reference thereto as if each
of the terms, conditions, agreements and provisions of the Term Sheet, as their
context provides or allows, were set forth herein as the findings,
determinations, and decretal and ordered provisions of this Order; provided,
however, that the following shall apply notwithstanding anything to the
contrary contained in the Motion or the Term Sheet: (A) the amount of past-due
premiums, referenced in Section 1 (2) of the Term Sheet, shall not exceed
$75,000; and (B) Liberty shall provide counsel to the Official Committee of
Unsecured Creditors (the "Committee") with written notice of any Event of
Default, concurrently with providing such notice of the Debtors;
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6. The Debtors be, and hereby are, authorized and directed to
take such further actions and execute and deliver, and to cause their
subsidiaries and affiliates to take such action and to cause them to execute and
deliver, such further documents as may be reasonably necessary to effectuate the
relief provided for herein and in the Term Sheet and to implement the terms,
conditions, agreements and provisions of the Term Sheet, including to enter
into any amendment to the Trust Agreement dated August 30, 2001 necessary to
effectuate the agreement between Liberty and Lehman Brothers, Inc., clarifying
the definitions of 'First Priority Secured Obligations' and 'Renewed Surety
Bonds'.
7. Good and sufficient notice of the Motion, the request for the
entry of this Order and the hearing thereon has been given in accordance with
Sections 102(1), 364, and 365 of the Bankruptcy Code and Bankruptcy Rules 2002,
4001 and 9019 and Local Rule 2001-1(b) and any otherwise applicable requirement
for further notice be and is hereby dispensed with and waived.
8. Except as specifically set forth in the Term Sheet, nothing
contained in this Order or the Term Sheet shall be deemed to terminate, modify,
or release any obligation to Liberty of the Debtors, any guarantor, surety,
insurer or entity providing financial accommodations
9. Except as specifically set forth in the Term Sheet, nothing
contained herein shall be deemed to limit or otherwise waive any rights that the
Debtors or Liberty have under the Bankruptcy Code, in law or equity or under any
agreement executed or delivered in connection with any surety bond, including
but not limited to the rights of subrogation, exoneration or indemnification,
the intent being that the rights, security interest and liens granted hereunder
are in addition to, and not in substitution of, such rights.
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10. This Order shall be sufficient and conclusive evidence of the
priority, perfection and validity of the security interests and liens granted
hereby without the necessity of filing, recording or serving any financing
statements, mortgages or other documents which may otherwise be required under
federal or state law or the taking of any other action to validate and perfect
the security interest and liens granted hereby. If Liberty, in its discretion,
shall elect to file or record such documents, the Debtors are authorized and
directed to execute and deliver financing statements or other documents
reasonably requested by Liberty.
11. The Court has considered all objections which were timely filed,
or interposed at the Hearing, and to the extent such objections have not been
withdrawn, such objections are overruled and denied.
12. Nothing contained in this Order or the Term Sheet shall be deemed
to terminate, modify or subordinate any lien or security interest of any of the
Lessor SPEs, the Lessor SPE Trustee, ARG Funding Corp., the ARG Trustee, the
Master Collateral Agent, and MBIA (collectively, the "Noteholder Group") in
pledged cash of up to $20 million, plus interest thereon, and in all other
collateral pledged by any Debtor to the Noteholder Group under the New Vehicles
Transaction Documents referenced in this Court's prior Order Authorizing Debtors
to (A) Lease Automobiles, and (B) Provide Protection in Connection with Master
Lease Agreements dated February 6, 2002 (the "Lease Order") or under the
Existing Master Lease Agreements, the Fourth Amended and Restated Master
Collateral Agency Agreement, dated June 20, 2000 (the "Master Collateral Agency
Agreement"), or any related documents, including but not limited to (i) all
rights, if any, of each Debtor in or relating to any Vehicles (as defined in the
Master Collateral Agency Agreement) purchased, financed or refinanced with
proceeds obtained
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from a Financing Source (as defined in the Master Collateral Agency Agreement)
and all rights, if any, of each Debtor in each Manufacturer Program (as defined
in the Master Collateral Agency Agreement) associated with such Vehicles and
(ii) all rights, if any, of each Debtor in or relating to the funds and
investments held in the Cash Collateral Account described in the Pledge
Agreement, dated as of February 20, 2002, by and between ANC Rental Corporation
and MBIA.
13. Entry of this order shall constitute a finding that the liens
and security interests of the Noteholder Group, more specifically set forth in
the preceding paragraph, do not extent to the Pre-Petition Liberty Cash
Collateral, the Liberty Post-Petition Cash Collateral or any cash received by
Liberty pursuant to the Debtors' obligations under Sections 2(d)(ii) and (iii)
of the Term Sheet.
14. Notwithstanding any provision of the Term Sheet, the
administrative priority claims granted to any of Noteholder Group pursuant to
the Lease Order and any subsequent court order shall rank pari passu with, not
junior to, the administrative priority claims granted to Liberty in connection
with this Order and the Term Sheet.
15. Except for the senior liens granted to Liberty in the Term
Sheet securing the Liberty Post-Petition Cash Collateral (as defined in the
Term Sheet) and the cash collateral replenishment obligation of the Debtors set
forth in Section 2, subparagraph 1.d.ii and 1.d.iii of the Term Sheet, which
shall be Senior Liens in accordance with Bankruptcy Code Section 364(d)(1),
such other senior liens provided for in the Term Sheet shall be subject and
subordinate
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to the replacement liens granted to the secured creditors for adequate
protection pursuant to the Cash Collateral Orders entered in these cases.
16. The Debtors shall provide the Official Committee of Unsecured
Creditors (the "Committee") with 5 days' notice of the cancellation of any bond;
provided that the Debtors will not be required to provide such notice with
respect to the cancellation of any bond in connection with the Debtors' airport
consolidation plan; provided further that nothing herein shall obligate Liberty
to provide any such notice to the Committee or any other party, and the Debtors'
failure to provide such notice shall not affect, diminish, restrict or infringe
upon Liberty's ability to cancel such bond without further order of the
Bankruptcy Court, or affect the validity of any such cancellation by Liberty.
17. The 10 day stay otherwise provided for under Bankruptcy Rule
6004(g) is hereby waived and shall not apply to the transactions and relief
hereby authorized.
Dated: Wilmington, Delaware
March 13, 2002
/s/
-----------------------------------------
UNITED STATES BANKRUPTCY JUDGE
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SUMMARY OF TERMS AND CONDITIONS OF
LIBERTY BOND SERVICES POST-PETITIONS BONDING
This proposal (the "Term Sheet") is made between Liberty Bond Services, an
unincorporated division of Liberty Mutual Insurance Company ("Liberty") and ANC
Rental Corporation, Debtor In Possession (sometimes referred to as "ANC") and
any of its subsidiaries and affiliates who are debtors in possession in
proceedings under the Bankruptcy Code (together with ANC collectively referred
to as the "Debtors") only, and is subject to the entry of an order of the
Bankruptcy Court approving the terms and conditions of the Term Sheet as agreed
to by ANC and Liberty, and such order becoming a "Final Order", as the term
"Final Order" is defined and discussed in Section 18 of this Term Sheet (the
"Approval Order").
SECTION 1 - 1. So long as no Event of Default (as defined below)
shall occur, and subject to (i) the conditions
UNDERWRITING AGREEMENTS precedent described in Sections 7(1) and 10 of this
Term Sheet, (ii) the delivery of the cash collateral
and/or letter of credit deposit required by Section
2, subparagraph (1)(d)(i) below, and (iii) the
limitations, conditions and agreements set forth in
this Section 1, subparagraphs "2" through "6," and in
Section 4 of this Term Sheet, Liberty shall:
(a) refrain and forebear from canceling or
terminating any of the surety bonds issued by Liberty
on behalf of ANC or any of its subsidiaries or
affiliates that are identified on Exhibits B, C and D
annexed to this Term Sheet, except upon the
consent of ANC.
(b) agree and consent to the assumption by ANC and/or
its appropriate debtor subsidiaries or affiliates of
(i) all surety bonds issued by Liberty or issued by
another at the behest of Liberty and upon which
Liberty has any liability, including liability as
co-surety or reinsurer, for the benefit of, on behalf
of or at the request of ANC (or any of its
subsidiaries or affiliates), that were, are or shall
be outstanding and in effect at any time during the
period following November 13, 2001 (hereafter
"Liberty Post Petition Bonds"); (ii) the surety bonds
identified on Exhibits C and D to this Term Sheet;
and (iii) the General Agreements of Indemnity,
Commercial Surety, in favor of Liberty executed by
ANC, as Indemnitor, and dated August 4, 2000 and
October 31, 2000, respectively (copies of which are
annexed hereto as Exhibit "A", and hereafter referred
to as the "Liberty Indemnity Agreements"), as
modified by this Term Sheet, and as limited to (1)
the Liberty Post Petition Bonds, and (2) any
renewals, continuations, increases, riders,
replacements, reinstatements and additional new
surety bonds which Liberty issues or which is issued
by another at the behest of Liberty and upon which
Liberty has any liability, including liability as
co-surety or reinsurer, for, or on behalf of or at
the request of any of the Debtors.
(c) at ANC's request, Liberty shall replace,
reinstate, renew or
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continue all Liberty Post Petition Bonds that became due or
will become due for renewal or continuation during the period
from November 13, 2001 to December 31, 2002 to the extent
identified on the attached list (to be provided, Exhibit "B"
hereto);
(d) at ANC's request, Liberty shall replace, reinstate, renew
and/or continue certain surety bonds issued by Liberty for the
benefit of, on behalf of or at the request of ANC (or any of
its subsidiaries or affiliates) and as identified on the
attached list (to be provided, Exhibit "C" hereto) that are
not part of the Liberty Post Petition Bonds (which certain
bonds shall be treated as part of the Liberty Post Petition
Bonds upon their replacement, reinstatement, renewal,
continuation, extension, etc.);
(e) issue change riders and/or increase or adjust bond penal
sums or issue new bonding through December 31, 2002 (other
than the "Consolidation Bonding" separately discussed in
subparagraphs "h" and "i" below), as mutually agreed between
ANC and Liberty and as identified on the attached list (to be
provided, Exhibit "D" hereto), which certain bonds shall be
treated as part of the Liberty Post Petition Bonds upon their
issuance or adjustment pursuant to Exhibit "D";
(f) issue all renewals, continuations, increases, riders and
additional new surety bonds referred to in subparagraphs (a)
through (e) above to provide that ANC will be the principal of
the bond, unless otherwise requested by ANC. The renewal,
continuation, issuance of a rider, increase of penal sum or
change of the principal on any previously outstanding surety
bond (including a change from an operating company that was
originally named as principal to substitute ANC as principal,
or to add additional principals), shall be deemed issuance of
a new bond.
(g) determine within a reasonable period, not to exceed ten
business days, all other requests by ANC for surety bonding
(including requests for increases in bond penal sums or for
the issuance of new, additional, renewed or continued bonding
other than as listed and described in subparagraphs "a"
through "e" above, and other than requests for "retro
bonding") in accordance with Liberty's then pertaining
underwriting standards, guidelines and practices for such
risks;
(h) with respect only to airports at which the Debtors operate
two concession locations, one for each operating brand (Alamo
and National), and there is a current Liberty concession bond
in place for each of the two locations, then: in the event the
Debtors consolidate their two bonded airport concession
locations into a single location, Liberty agrees to provide a
consolidated
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concession bond (which shall be deemed to be a Liberty Post
Petition Bond) for such consolidated operations in such
location that replaces the prior existing bonds for the prior
unconsolidated locations ("Consolidation Bonding"), provided
that (i) the penal sum of the new consolidated surety bond
required for the new, combined concession is not in excess of
the combined penal sums of the prior existing bonds; (ii) the
terms and conditions of the new Consolidation Bonding are
substantially the same as the terms and conditions of the
prior, pre-consolidation bonds; and (iii) the airport or other
obligee on the prior, pre-consolidation bonds delivers a
written agreement to ANC and to Liberty in a form acceptable
to Liberty stating that upon the issuance of the new
Consolidation Bonding, the obligee will (1) execute a release
in form satisfactory to Liberty of all of obligee's rights in
or claims arising under the pre-consolidation bonds, and (2)
deliver the original pre-consolidation bonds to Liberty marked
"null and void" confirmed by the signature of an officer or
other authorized representative of the obligee;
(i) With respect only to (x) airports at which the Debtors
operate two concession locations, one for each operating brand
(Alamo and National), and there is a current Liberty surety
bond in place for only one of the two locations (i.e., there
is one bonded and one unbonded concession location at a given
airport), and the Debtors elect to consolidate the bonded and
the unbonded concession locations into a single consolidated
location; and (y) airports at which the Debtors operate only
one concession location, for only one operating brand (the
"original brand"), and there is a current Liberty surety bond
in place for said concession location, and the Debtors elect
to add another operating brand to the original brand's bonded
concession location, and concurrently consolidate both brands
under the ANC trade name; then: Liberty agrees that for the
consolidated locations described in subparts (x) and (y)
immediately preceding, Liberty will provide a consolidated
bond (which shall be deemed to be a Liberty Post Petition
Bond) for the entire consolidated operation in such location
(which shall also be referred to in this Term Sheet as
"Consolidation Bonding"), provided that (i) the penal sum of
the new surety bond for the consolidated location may not
exceed 110% of the penal sum of the prior bond for the prior
bonded location (the locations that may be subject to such a
consolidation are limited to those identified on Exhibit E
hereto); and in no event, shall the penal sum increases that
are agreed to herein exceed, in the aggregate, $175,000; (ii)
the terms and conditions of the new Consolidation Bonding are
substantially the same as the terms and conditions of the
prior bond for the prior bonded location; and (iii) the
airport or other obligee on the prior bond for the prior
bonded location
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delivers a written agreement to ANC and to Liberty,
substantially in the form attached hereto as Exhibit
"E" or as otherwise agreed to by ANC and Liberty,
stating that upon the issuance of the new
Consolidation Bonding, the obligee will (1) execute a
release in form satisfactory to Liberty of all of
obligee's rights in or claims arising under the
pre-consolidation bonds, and (2) deliver the original
pre-consolidation bonds to Liberty marked "null and
void" confirmed by the signature of an officer or
other authorized representative of the obligee.
2. Premium rate to remain $10 per thousand, to be
paid simultaneously upon issuance, renewal or
continuation of each particular surety bond and to be
remitted by wire directly to Liberty (not through a
broker). Past-due premiums for surety bonds
previously issued by Liberty, if any, shall be paid
by wire transfer from ANC to Liberty upon the entry
of the Approval Order.
3. The entry of the Approval Order shall be deemed
an acknowledgement by the Debtors and a determination
by the Bankruptcy Court that all surety bonds
heretofore or hereafter issued by Liberty are
financial accommodations which cannot be assumed by
the Debtors without the consent of Liberty.
4. Nothing set forth in this Term Sheet shall
obligate Liberty to replace, reinstate, renew,
continue or extend, or to forebear from canceling or
terminating, any surety bond which Liberty determines
to have been issued without authorization or which
was unreported and which has not been heretofore
ratified by Liberty, and said bonds may be canceled
by Liberty upon five days written notice to ANC and
without further order of the Bankruptcy Court;
provided, however, that Liberty agrees that no surety
bond identified on Exhibits B, C or D hereto, or on
the bond schedules annexed to the Agreement dated
August 30, 2001 between ANC and Liberty (the
"Liberty/ANC Pre-Petition Agreement"), shall be
deemed unauthorized or unreported.
5. Notwithstanding anything in this Term Sheet or in
any exhibit annexed hereto to the contrary, (a) the
total aggregate penal sums of all surety bonds
outstanding issued by Liberty or issued by another at
the behest of Liberty and upon which Liberty has any
liability, including liability as co-surety or
reinsurer, for the benefit of, on behalf of or at the
request of ANC (or any of its subsidiaries or
affiliates) (including both pre-petition and
post-petition) shall at no time exceed $133 million,
(b) the maximum aggregate penal sum amount set forth
in subparagraph "a" above shall be reduced by the
amounts of all payments of loss, cost or expense made
by Liberty, whether or not such amounts are
reimbursed to Liberty out of collateral, and (c) the
maximum
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aggregate penal sum amount set forth in subparagraph
"a" above shall not be increased or replenished due
to reimbursement received by Liberty from collateral
or any other recoveries. However, nothing herein
shall be construed or deemed to constitute or create
a "committed surety bond facility" or surety bond
credit line of any kind or in any amount in favor of
ANC or any other person or entity, and ANC expressly
warrants and represents that it has not received and
has not relied upon any agreement or representation,
oral or written, to the contrary.
6. The Debtors shall assume and agree to be bound
by the Liberty Indemnity Agreements, as modified by
this Term Sheet, with respect to Liberty Post
Petition Bonds and with respect to any additional,
increased, new, renewed or continued surety bonding
which Liberty provides to any of the Debtors, and
shall be jointly and severally liable for the
performance of all obligations thereunder ("the
Assumed Indemnity Obligations").
SECTION 2 -- 1. All of the Assumed Indemnity Obligations shall be
COLLATERAL TERMS secured and treated as follows:
a. Treatment as allowed super-priority
administrative expenses pursuant to sections
507(a)(1) and (b) of the Bankruptcy Code, with
priority over any and all other administrative
priority expense claims under sections 507(a)(1) and
(b) of the Bankruptcy Code, with such super-priority
administrative expense claim status of Liberty to be
subject and subordinate only to the carve-outs
provided to retained professionals and to the
quarterly fees payable to the Office of the United
States Trustee, as provided for in orders of the
Bankruptcy Court authorizing the Debtors' use of Cash
Collateral (as that term is defined in section
363(a) of the Bankruptcy Code), provided, however,
that Debtors shall under no circumstances seek to
provide, and no order shall be entered granting, any
entity with a super-priority priority equal to or
senior to the super-priority granted to Liberty
herein (with the sole exceptions of "DIP Financing,"
as set forth in Section 2, paragraph 3 (including
all subparagraphs) below, and the MBIA Order as
defined in Section 2, paragraph 1(b)(i) below);
b. Collateralized by a first priority senior lien
in accordance with Bankruptcy Code section
364(d)(1), senior to the rights, interests and liens
of any other person or entity, in the entirety of
the assets of the Debtors' estates; provided however
that, except for the Liberty Post-Petition Cash
Collateral (as hereinafter defined) and the cash
collateral replenishment obligation of the Debtors
set forth in this Section 2 subparagraph 1.d.ii and
1.d.iii. below, such senior liens shall be subject
and subordinate only to:
i. The senior lien granted to MBIA and the
Master
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Collateral Agent (as that term is referred
to in that certain order of the Bankruptcy
Court dated February 6, 2002 entitled "Order
Authorizing Debtors to (A) Lease
Automobiles, and (B) Provide Protection in
Connection With Master Lease Agreements"
(the "MBIA Order")) in paragraph 8 of the
MBIA Order;
ii. Any valid, perfected and non-avoidable
security interests as were in existence as
of the Debtors' chapter 11 petition filing
dates (the "Pre-petition Security
Interests"), except that such subordination
shall not apply to the extent of any rights
Liberty may have under and relating to the
Pre-petition Security Interests and any
agreements executed in connection therewith
(collectively, and together with the
Liberty/ANC Pre-Petition Agreement, the
"Pre-Petition Secured Creditor Agreements"),
including with respect to relative
priorities among and between Liberty and
other entities asserting, or entitled to,
security interests in assets of the Debtors;
and
iii. The Senior DIP Lender's Lien (as defined in
and subject to the limitations set forth in
Section 3, paragraph "3" of this Term
Sheet).
c. Further collateralized by (i) the non-cash
collateral granted Liberty in the Pre-Petition
Secured Creditor Agreements, and (ii) at Liberty's
sole option and election, the $6 million in
pre-petition letters of credit currently held by
Liberty ("Pre-Petition Liberty Cash Collateral"); and
d. Further collateralized by cash and/or, at ANC's
option, a letter of credit as follows:
i. Upon the entry of the Approval Order, ANC
shall deliver to Liberty $6 million in cash
and/or letter of credit (in form acceptable
to Liberty) collateral ("Liberty
Post-Petition Cash Collateral");
ii. Each time that Liberty has drawn a total of
$2 million upon the Liberty Post-Petition
Cash Collateral in connection with the
Assumed Indemnity Obligations, the Debtors,
jointly and severally, shall cause the
Liberty Post-Petition Cash Collateral to be
replenished to the original $6 million
amount; and
iii. The replenishment of the Liberty
Post-Petition
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Cash Collateral pursuant to subparagraph "ii" immediately
above shall occur a maximum of six (6) times (for a total
replenishment of obligation of $12 million), provided,
however, that ANC shall not be required to provide more than
a single $2 million replenishment of the Liberty
Post-Petition Cash Collateral during any 30-day period.
2. Anything in this Term Sheet to the contrary
notwithstanding, it is expressly understood that (x)
Liberty's right to draw upon the Pre-Petition Liberty Cash
Collateral is not limited to reimbursement for losses, costs
or expenses that are part of the Assumed Indemnity
Obligations, but extends to all loss, cost or expenses
incurred by Liberty under the terms of the August 4, 2000 and
October 31, 2000 Indemnity Agreements in favor of Liberty
executed by ANC, and under the terms of the Liberty/ANC
Pre-petition Agreement, and (y) Liberty may choose, at its
sole option and discretion, to draw upon the Pre-Petition
Cash Collateral to reimburse itself for losses, costs or
expenses that are part of the Assumed Indemnity Obligations,
but shall have no obligation to do so and may apply the
Pre-Petition Liberty Cash Collateral to obligations in any
way it deems appropriate under the circumstances in its own
best interest.
3. Liberty acknowledges that ANC is seeking new DIP financing
in the maximum sum of $100 million (beyond amounts which may
be used to take out or replace existing secured creditors)
and that pursuant to any such arrangement, Debtors will be
required to grant to such DIP lender a security interest that
is senior to all of the security interests and liens that
Liberty may have in any or all of the assets of the Debtors'
estates (the "Senior DIP Lender's Lien"). Without obligating
ANC to obtain or seek such financing, Liberty will consent to
such financing and the related Senior DIP Lender's Lien, but
conditioned upon and only to the extent of the following,
terms and conditions:
(a) such Senior DIP Lender's Lien shall not affect, apply or
attach to (i) the Pre-Petition Liberty Cash Collateral, (ii)
the Liberty Post-Petition Cash Collateral, (iii) the cash
collateral replenishment obligation (the "Collateral
Replenishment Obligation") of the Debtors set forth in this
Section 2 subparagraph 1.d.ii and 1.d.iii, or (iv) any of
Liberty's rights and remedies as reserved in section 8 of
this Term Sheet, or under or relating to the Pre-Petition
Secured Creditor Agreements;
(b) to the extent such financing is obtained by Debtors, such
financing shall not prohibit or restrict the right and
ability of Debtors to meet their obligations under and with
respect to this Term Sheet, including those relating to
providing Liberty with the
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Liberty Post-Petition Cash Collateral and the
Collateral Replenishment Obligation, and such
financing shall not conflict with the provisions of
this Term Sheet;
(c) nothing herein, or in or relating to the new DIP
financing or the proposed Senior DIP Lender's Lien,
will impact or affect Liberty's existing priorities
and/or rights with respect to other existing secured
creditors;
(d) Liberty shall not be required to consent to such
financing, and Liberty's security interests and liens
which may otherwise have been subordinated to such
financing will not be subordinated, to the extent
that the liens and security interests of any other
existing secured creditors (or their successors,
assigns or replacements) are not, for any reason,
subordinated to the liens to be granted to such DIP
lender in similar degree to the subordination of
Liberty's liens and security interests, or if such
financing would affect the priorities in distribution
otherwise provided for under the Pre-Petition Secured
Creditor Agreements; and
(e) Debtors shall reimburse Liberty for all
reasonable attorneys' fees and out-of-pocket expenses
incurred in connection with reviewing, evaluating or
otherwise participating in the formulation or
finalization of any such new DIP Financing in
accordance with the procedures set forth in the last
four sentences of Section 9 of this Term Sheet.
Should all of the above pre-conditions and terms for
Liberty's consent to the new DIP Financing and the
Senior DIP Lender's Lien be fully satisfied, then
Liberty shall execute (at ANC's sole cost and
expense) all documentation reasonably requested by
Debtors to five effect to such financing and such
priority.
SECTION 3 - 1. (a) all ANC non-debtor subsidiaries and/or
affiliates that executed any Surety Bond Guarantee
ASSUMED INDEMNITY And Assumption Agreement in connection with the
AGREEMENT MODIFICATIONS Liberty/ANC Pre-Petition Agreement or the
Pre-Petition Secured Creditor Agreements shall
execute an agreement, in a form acceptable to Liberty
in its sole discretion, confirming that neither the
execution nor the implementation of this Term Sheet
(including all actions and documents contemplated by
this Term Sheet) shall in any way affect, impair,
alter or in any way modify their obligations and
liabilities under the Surety Bond Guarantee And
Assumption Agreement.
(b) The Debtors (hereafter sometimes referred to as
the "Debtor Indemnitors") shall be obligated, jointly
and severally, as indemnitors under the Liberty
Indemnity Agreements, and shall
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be jointly and severally liable for the Assumed
Indemnity Obligations. The Debtor Indemnitors shall
execute appropriate documentation in form
satisfactory to Liberty obligating them, jointly and
severally, in accordance with this Term Sheet.
2. So long as there shall be no Event of Default as
defined in this Term Sheet, the obligations of Debtor
Indemnitors under Paragraph "3," Indemnity, of the
Liberty Indemnity Agreements with respect to the
Assumed Indemnity Obligations shall be deemed
modified as follows:
a. following (i) the full performance of the $12
million replenishment obligation of ANC as described
in Section 2 of this Term Sheet, subparagraph
(1)(d)(ii) and (1)(d)(iii) thereof, and (ii) the
exhaustion of the Liberty Post-Petition Cash
Collateral in connection with the Assumed Indemnity
Obligations, all Debtor Indemnitors shall be jointly
and severally obligated to (x) reimburse Liberty
within ten (10) business days of written demand for
50% of any of Liberty's loss, cost or expense that
is within the scope of the Assumed Indemnity
Obligations and which has not been previously paid to
Liberty, and (y) pay the remaining 50% of any such
loss, cost or expense (the "Deferred Indemnity
Obligation") within six months of the date of
Liberty's aforesaid written demand, together with
interest on the Deferred Indemnity Obligation at the
rate of 6% per annum.
b. The Deferred Indemnity Obligations shall be deemed
secured and treated in the same manner as the Assumed
Indemnity Obligation in Section 2 of this Term Sheet.
c. At Liberty's request, the Deferred Indemnity
Obligations may be memorialized in promissory notes
setting forth the term, interest rate and amount of
the Deferred Indemnity Obligations, which notes shall
be (i) deemed secured by the collateral set forth in
Section 2 hereof; and (ii) freely transferred,
assigned or negotiated by Liberty to the extent
permitted by law. However, the execution of such
promissory notes shall not be required in order to
create the secured Deferred Indemnity Obligations or
to insure the survival of such obligations as set
forth in subparagraph 2(d) immediately below.
d. Notwithstanding anything to the contrary set forth
herein, the total amount of all Deferred Indemnity
Obligations outstanding at any one time shall in no
event exceed $8 million, and any such Deferred
Indemnity Obligations (whether or not memorialized as
promissory notes) shall survive the confirmation of
any plan of reorganization (and shall be immediately
payable upon such confirmation) or the conversion or
dismissal of any of the Debtors' cases.
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c. So long as (i) none of the Deferred Indemnity
Obligations as described shall be in default of
payment, (ii) and the limitation upon the total
amount of such obligations set forth in subparagraph
"d" immediately above has not exceeded, and (iii) no
Event of Default as defined in this Term Sheet shall
have occurred, then Liberty shall take no action to
enforce the obligations set forth in Paragraphs "3"
or "5" of the Liberty Indemnity Agreements against
any Indemnitor with respect to such Deferred
Indemnity Obligations.
3. So long as there is no Event of Default as defined
herein, and the Debtors and non-debtor indemnitors
are in compliance with Section 6 of this Term Sheet,
Liberty will forebear from enforcing its rights under
paragraphs "5" and "7" of the Liberty Indemnity
Agreements with respect to any Indemnitor.
4. Notwithstanding sub-part 4 of paragraph 6 of the
Liberty Indemnity Agreements, the presently pending
proceedings of the Debtors under Chapter 11 of the
Bankruptcy Code shall not trigger the assignment
provisions of paragraph 6 of the Liberty Indemnity
Agreements; however, sub-parts 1, 2 and 3 and the
other remaining provisions of paragraph 6 of the
Liberty Indemnity Agreements shall remain in full
force and effect.
5. So long as there is no Event of Default as defined
herein, paragraph "11" of the Liberty Indemnity
Agreements will not be operative to the extent that
it is inconsistent with any agreement of Liberty set
forth in Section 1 of this Term Sheet.
6. Paragraph 15 of the Indemnity Agreement dated
August 4, 2000, and paragraph 16 of the Indemnity
Agreement dated October 31, 2000, are hereby modified
to require that Liberty consent, in its sole
discretion, to the termination of the obligations of
any indemnitor.
7. Except as expressly set forth above in this
Section 3 of this Term Sheet, or as may be set forth,
with Liberty's consent to be exercised in its sole
discretion, in the Approval Order, the Liberty
Indemnity Agreements are assumed as written.
SECTION 4 - Immediately upon the occurrence of any Event of
Default set forth in Section 5 of this Term Sheet,
REMEDIES AND RIGHTS subparagraph 1(a), 1(b), 1(g), 1(h), 1(i) or 1(j), or
UPON EVENT OF DEFAULT upon the occurrence of any Event of Default set forth
in Section 5 of this Term Sheet, subparagraph 1(c),
1(d), 1(e), 1(f), 1(k), 1(l) or 1(m) which remains
uncured for five (5) days following the date of
transmission of notice of such default to ANC, then
without any notice to any other party and without
further Order of the Bankruptcy Court, all Deferred
Indemnity Obligations shall become immediately
accelerated and
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due in full, and Liberty (a) shall no longer have
any obligation to renew, continue, extend or issue
any surety bonds, notwithstanding any terms set
forth in Section 1 of this Term Sheet, and (b) may
(i) liquidate and realize upon the non-cash
collateral described in Section 2 hereof (subject to
any rights of any senior secured creditor),
including without limitation commence appropriate
proceedings to foreclose upon and/or realize upon
such collateral in courts of competent jurisdiction,
(ii) fully enforce all of its rights under the terms
of the Liberty Indemnity Agreements against any and
all indemnitors in courts of competent jurisdiction,
and (iii) cancel any and all surety bonds issued by
Liberty on behalf of ANC, its subsidiaries and/or
affiliates, whether issued or outstanding
pre-petition or post-petition.
SECTION 5 - 1. Each of the following shall constitute an "Event
Events of Default of Default" hereunder (after the
EVENTS OF DEFAULT time periods in Section 4 have elapsed): (a) the
conversion or dismissal of the ANC bankruptcy case
(or that of any of the other Debtors) to Chapter 7;
(b) the appointment of a trustee, or an examiner with
powers other than to review and report, or any other
person or entity exercising powers traditionally
ascribed to a trustee, in any of the Debtors' Chapter
11 cases; (c) the failure of ANC to timely replenish
Liberty Post-Petition Cash Collateral as required in
Section 2 of this Term Sheet, subparagraphs 1(d)(ii)
and 1(d)(iii); (d) the default by any Debtor
Indemnitor upon any of its obligations under the
Assumed Indemnity Obligations, and the default by any
non-debtor indemnitor upon any of its indemnity
obligations or obligations hereunder; provided,
however, that a proceeding of liquidation,
receivership or bankruptcy of a non-debtor indemnitor
shall not be deemed a default if, within 20 calendar
days of the commencement of said proceeding, ANC
deposits with Liberty additional cash or (at ANC's
option) letter of credit collateral (in form
acceptable to Liberty), in the amount of $250,000.00;
(e) the non-payment of any Deferred Indemnity
Obligation when due; (f) the increase of Deferred
Indemnity Obligations to an amount in excess of the
$8 million limitation set forth in Section 3 of this
Term Sheet, paragraph 2(d) thereof; (g) the sale or
other disposition (including a material change in
ownership or management) of ANC or one of ANC's
operating subsidiaries or brands that conducts
business in the United States, or the filing of a
motion seeking such sale or other disposition,
without Liberty's consent; (h) the sending of a
"notice of acceleration" or similar notice triggering
collateral liquidation by any of the senior secured
pre-petition lenders or by any post-petition DIP
financing party or senior secured party or lender;
(i) Liberty's receipt of a demand for payment under
any of the "retro bonds" issued by
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Liberty on behalf of ANC or any of its subsidiaries
or affiliates identified on the attached schedule (to
be provided) which is nether withdrawn by the obligee
within ten (10) calendar days after Liberty's receipt
of such demand, or for which Liberty is not fully
collateralized by Debtors with additional cash or
letter of credit collateral within ten (10) calendar
days after Liberty's receipt of such demand; (j)
ANC's failure to cause any non-debtor to execute
documentation as required by Section 11 of this Term
Sheet within seven days of demand by Liberty; (k) the
termination of the Debtors' right to utilize Cash
Collateral (as that term is defined in Section 363(a)
of the Bankruptcy Code) (other than a voluntary
termination by the Debtor); (l) failure of ANC to pay
the Liberty Statement when due pursuant to Section 9
of this Term Sheet; and (m) any failure by ANC to
reduce the total aggregate penal sums of all surety
bonds outstanding to the maximum amount set forth in
Section 1, paragraph "5" of tis Term Sheet, within
thirty (30) days of written demand by Liberty to ANC.
Liberty may, however, in its sole discretion, waive
any one or more defaults, or extend any period within
which to cure such defaults, without in any way
diminishing or waiving its right to enforce fully the
terms of this Term Sheet with respect to any and all
defaults or other or subsequent defaults.
2. Without limiting the generality of the foregoing,
it is agreed that the events of default under the
Pre-Petition Secured Creditor Agreements shall not
constitute Events of Default hereunder, nor shall the
consolidation of Alamo and National concession
agreements for the same airport or the rejection of
concession agreements in connection with such
consolidation constitute an Event of Default.
SECTION 6 - 1. So long as the Debtors shall continue to file with
the Bankruptcy Court operating statements and other
FINANCIAL DISCLOSURE AND financial disclosure required by the Bankruptcy Code
COVENANTS and/or Bankruptcy Rules and/or order of the
Bankruptcy Court, there will be no requirement for
such indemnitors to transmit any additional periodic
financial disclosure or information to Liberty;
except that such indemnitors shall provide Liberty
with any financial information or records which
Liberty deems reasonably necessary to assess or
respond to any claim, demand, exposure or risk that
relates to any bond issued pre-petition by Liberty
and/or any Liberty Post-Petition Bonds. However,
should such filings no longer be made or required
with respect to any Indemnitor who is a Debtor
herein, then the monthly reporting requirements of
paragraph 5 of the Liberty/ANC Pre-Petition Agreement
shall be deemed incorporated into this term sheet and
shall apply to such Debtor or former Debtor (as the
case may be) so long as such Debtor or former Debtor
(as the case may be) continues to be an
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Indemnitor to Liberty for any portion of the Assumed
Indemnity Obligations.
2. All non-debtor indemnitors whose financial
operations are not detailed in the bankruptcy filings
and disclosures described in subparagraph "1"
immediately above shall, upon Liberty's request,
furnish their quarterly or annual financial
statements to Liberty, together with such other
financial documentation and information as Liberty
may reasonably require in order to continually
assess the equity and debt position and
creditworthiness of such non-debtor indemnitors.
3. Other than as set forth expressly herein, this
Term Sheet does not, and any documentation entered
into in connection herewith will not, contain any
negative or affirmative covenants of any kind
applicable to ANC or any of its subsidiaries.
SECTION 7 - 1. ANC and the other Debtors acknowledge, and the
entry of the Approval Order shall constitute an
PRE-PETITION SECURITY Order, finding and decree of the Bankruptcy Court
INTERESTS OF LIBERTY that, (a) to the extent of the aggregate penal sums
of all surety bonds renewed, continued, issued,
increased or permitted to remain in full force and
effect subsequent to August 30, 2001, Liberty has a
valid, perfected and unavoidable (under 11 U.S.C. ss.
547 or otherwise) security interest in the collateral
granted in the Pre-Petition Secured Creditor
Agreements; (b) payments made to Liberty by ANC prior
to the petition date, including payments in respect
of premiums and fees, are non-avoidable, and (c) such
acknowledgement, order, finding and decree is binding
upon all persons and entities.
2. Nothing in this Term Sheet shall constitute a
waiver by Liberty under or with respect to the
Pre-Petition Secured Creditor Agreements, and Liberty
reserves all rights in connection therewith. Liberty
may draw upon the Pre-Petition Liberty Cash
Collateral in accordance with its terms, and nothing
contained in this Term Sheet shall prohibit or
restrict such right.
SECTION 8 - Notwithstanding anything to the contrary set forth
herein, all of Liberty's equitable or other common
COMMON LAW SURETY law surety rights and remedies, whether arising by
RIGHTS virtue of equitable lien, equitable subrogation or
otherwise, are fully reserved.
SECTION 9 - The Debtors are obligated to pay (a) Liberty's
reasonable fees and out-of-pocket expenses arising
FEES AND EXPENSES out of or in connection with (i) the negotiation,
execution and presentation to the Bankruptcy Court of
this Term Sheet, (ii) the Approval Order, (iii) the
preparation, drafting, execution and/or closing of
the transactions contemplated by this Term Sheet, and
(b) Liberty's reasonable
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fees and out-of-pocket expenses incurred in
protecting or safeguarding the rights and interests
granted to it herein or in the Approval Order,
whether incurred in a bankruptcy court proceeding or
any in other proceedings in any other court or
judicial or administrative venue. The aforesaid
payment obligations shall be deemed part of the
Assumed Indemnity Obligations. Liberty shall provide
counsel for ANC and counsel for the Official
Committee of Unsecured Creditors ("the Committee")
with a reasonably detailed summary of such fees and
expenses (the "Liberty Statement"). The only basis
for objection to the Liberty Statement shall be as to
the reasonableness of the charges set forth for the
work performed. If no objection is received by
counsel for Liberty within seven (7) days following
the date of delivery of the Liberty Statement (the
"Objection Deadline"), ANC shall pay the Liberty
Statement within three business days following the
Objection Deadline. If there is a dispute as to the
amount of the Liberty Statement, which dispute cannot
be resolved between Liberty and the entity asserting
such objection, such dispute shall be submitted to
the Bankruptcy Court for a determination of the
reasonableness of the Liberty Statement on at least
five (5) days' notice to counsel for ANC and for the
Committee.
SECTION 10 -- All of the foregoing terms will be subject to the
entry of the Approval Order providing for section 364
BANKRUPTCY COURT ORDER of the Bankruptcy Code collateralization and
A PRE-CONDITION protections to Liberty as a secured creditor and
containing other terms reasonably satisfactory to ANC
and Liberty. The agreements set forth in this Term
Sheet are not to be deemed effective in any way prior
to the entry of the Approval Order. Nothing set forth
herein shall in any way bind, or shall in any manner
modify, limit or diminish the rights of Liberty or
any Debtor until the entry of the Approval Order.
Without limiting the generality of the foregoing,
nothing set forth herein shall in any way bar, limit
or modify Liberty's right to seek relief from the
automatic stay to cancel bonds, or to seek any other
relief in the Debtors' bankruptcy cases, prior to the
entry of the Approval Order.
SECTION 11 -- Within twenty (20) business days of the entry of the
Approval Order, ANC shall cause all non-debtor
DOCUMENTATION OF NON- subsidiaries and/or affiliates to execute and deliver
DEBTORS to Liberty the agreements described in Section 3,
paragraph 1(a) of this Term Sheet.
SECTION 12 -- The provisions of this Term Sheet, as shall be
approved by the Approval Order, including the rights,
BINDING EFFECT interests, liens and security interests provided for
herein and granted to Liberty, and the priorities of
same, shall not be altered or affected by any plan of
reorganization (or liquidation) filed by or on behalf
of the Debtors
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or one or more third parties, or by the incurrence
from and after the date of the Approval Order of
indebtedness pursuant to section 364 of the
Bankruptcy Code, or otherwise (except as set forth
in Section 2, subparagraph "3" with respect to
certain proposed DIP Financing). Without limiting
the generality of the foregoing, the provisions of
this Term Sheet, as shall be approved by the
Approval Order, shall be binding on Liberty, the
Debtors, all parties in interest in the Debtors'
cases, and their respective successors and assigns,
including any of the following persons or entities
if appointed in the Debtors' cases, acting on
behalf of or with respect to any of the Debtors: any
trustee, examiner, representative or liquidating or
administrative agent.
SECTION 13 -- The automatic stay provided in section 362 of the
Bankruptcy Code shall, without the necessity of any
LIFTING OF STAY order of the Bankruptcy Court other than the
Approval Order, be modified and vacated to the
extent necessary to permit Liberty to implement this
Term Sheet as approved by the Approval Order,
including to permit Liberty to exercise its rights
and remedies as provided for in the Term Sheet.
SECTION 14 -- The entry of the Approval Order shall be a
determination by the Bankruptcy Court that the terms
FINDING OF GOOD FAITH of the Term Sheet were negotiated in good faith and
at arms length, and all loans, advances, financial
accommodations and surety bonds which are or caused
by Liberty to be issued, renewed, extended,
continued, increased or modified are deemed to have
been extended in good faith as that term is referred
to in section 364(e) of the Bankruptcy Code, and
shall be entitled to the full protection of section
364(e) of the Bankruptcy Code in the event that the
Approval Order or any term of this Term Sheet as
shall be incorporated into the Approval Order is
vacated, reversed or modified on appeal or otherwise.
SECTION 15 -- Except as specifically set forth in this Term Sheet,
nothing contained herein, or in the Approval Order,
NON-TERMINATION shall be deemed to terminate, modify or release any
obligation of the Debtors or any guarantors thereof.
SECTION 16 -- The Approval Order shall confirm that the entry of
the Approval Order, and the relief provided for
CORE PROCEEDING therein, constitute "core proceedings" as defined in
28 U.S.C. ss. ss. 157 and 1334, and that the
Approval Order, and the parties thereto, shall be
subject to the benefits of sections 363(m) and
364(c) of the Bankruptcy Code, and that the
Bankruptcy Court has jurisdiction over the
proceedings and the parties and the property
affected thereby pursuant to 28 U.S.C. ss. ss. 157
and 1334.
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SECTION 17 -- The entry of the Approval Order shall be sufficient
and conclusive evidence of the priority, perfection
PERFECTION and validity of the security interests and liens
granted pursuant to this Term Sheet as approved by
the Approval Order, without the necessity of filing,
publishing, recording or serving any financing
statements, mortgages or other documents or notices
which may otherwise be required under federal, state
or local law, or the taking of any action to
validate and perfect the security interests and
liens granted pursuant to the Term Sheet and the
Approval Order; provided, however, that if Liberty in
its discretion shall elect to file or record such
documents, the Debtors shall execute and deliver
financing statements or other documents reasonably
requested by Liberty, and Liberty may thereafter in
its discretion take such further action as may be
necessary to file or record such documents.
SECTION 18 -- In this Term Sheet: (a) except where the language
identifies an intent to limit, the word "including"
RULES OF CONSTRUCTION shall mean "including, without limitation", with
regard to the items or matters listed thereafter; (b)
a reference to the "Court", shall mean the
"Bankruptcy Court in which the chapter 11 cases of
the Debtors was pending as of the date of the
execution of the Term Sheet"; (c) the phrase "entry
of the Approval Order" shall mean the entry of such
order on the legal docket maintained by the Clerk of
the Bankruptcy Court in which the chapter 11 cases
of the Debtors are pending and that such order has
become a Final Order; and (d) the term "Final Order"
shall mean an order of the Bankruptcy Court
approving the terms and conditions of the Term Sheet
as agreed to by ANC and Liberty which either (i) is
not the subject of a stay and for which the time to
file an appeal has expired without an appeal having
been filed (or if such appeal has been filed, such
appeal has been withdrawn) or (ii) if mutually
agreed to by ANC and Liberty, is an order with
regard to which there is no stay in effect and for
which no objection had been filed or considered by
the Court (or if filed or considered, such objection
had been withdrawn) prior to or at the hearing at
which the Court considered the motion seeking
approval of such Term Sheet.
SECTION 19 -- The Debtors and Liberty acknowledge that the Approval
Order shall constitute a settlement and compromise
RESOLUTION of disputes discussed by and between them as to
OF DISPUTE Debtor's ability to assume the Liberty Post-Petition
Bonds, Liberty's right to cancel those bonds, and
any and all disputes regarding the validity,
perfection and non-avoidability of any pre-petition
security interests granted and payments made to
Liberty.
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SECTION 20 -- Notices required hereunder shall be sent to the
parties hereto by facsimile and by overnight mail,
NOTICES as follows:
Liberty Mutual Ins. Co.
c/o Liberty Bond Services
450 Plymouth Road
Suite 400
Plymouth Meeting, PA 19462
Attention: Kyle Carney New, Esq.
Fax: 610-828-5821
With a copy to:
Mark S. Gamell, Esq.
Torre, Lentz, Gamell, Gary & Rittmaster, LLP
100 Jericho Quadrangle, Suite 309
Jericho, New York 11753-2702
Fax: 516-240-8950
ANC Rental Corporation
200 South Andrews Avenue, 11th Floor
Fort Lauderdale, Florida 33301-1864
Attention: Howard D. Schwartz, Esq.
With a copy to:
Matthew Gluck, Esq.
Fried, Frank, Harris, Shriver & Jacobson
One New York Plaza
New York, NY 10004-1980
SECTION 21 -- NO THIRD This Term Sheet is for the benefit of the parties to
PARTY BENEFICIARIES this Term Sheet only, and none of the provisions in
this Term Sheet are intended to benefit, and none
shall inure to the benefit of or be enforceable by
any third parties, such that this Term Sheet shall
not create, nor be deemed to create, any express or
implied third party beneficiaries.
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