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As filed with the Securities and Exchange Commission on November 12, 2003

Registration No. 333-108185

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Amendment No. 3
To
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

SIRVA, INC.
(Exact name of Registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization) 4213
(Primary Standard Industrial
Classification Code Number) 52-2070058
(I.R.S. Employer
Identification Number)

700 Oakmont Lane
Westmont, Illinois 60559
(630) 570-3000
(Address, including ZIP code, and telephone number, including
area code, of Registrant's principal executive offices)

Ralph A. Ford
SIRVA, Inc.
Senior Vice President, General Counsel and Secretary
700 Oakmont Lane
Westmont, Illinois 60559
(630) 570-3000
(Name, address, including ZIP code, and telephone
number, including area code, of Registrant's agent for service)

Copies to:
Steven J. Slutzky, Esq. Debevoise & Plimpton 919 Third Avenue New York, New York 10022 (212) 909-6000	Ronald Cami, Esq. Cravath, Swaine & Moore LLP Worldwide Plaza 825 Eighth Avenue New York, New York 10019 (212) 474-1000

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

        If the securities being registered on this Form are being offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. o

        If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box. o

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

Subject to Completion. Dated November 12, 2003.

21,052,632 Shares

Common Stock

        This is an initial public offering of shares of common stock of SIRVA, Inc.

        SIRVA, Inc. is offering 13,157,895 of the shares to be sold in the offering. The selling stockholders identified in this prospectus are offering an additional 7,894,737 shares. SIRVA, Inc. will not receive any of the proceeds from the sale of the shares being sold by the selling stockholders.

        Prior to this offering, there was no public market for the common stock. We currently estimate that the initial public offering price per share will be between $18.00 and $20.00. We have been approved to list the common stock on the New York Stock Exchange under the symbol "SIR".

        See "Risk Factors" beginning on page 13 to read about factors you should consider before buying shares of the common stock.

Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

	Price to Public	Underwriting Discounts and Commissions	Proceeds to SIRVA	Proceeds to the Selling Shareholders
Per Share	$	$	$	$
Total	$	$	$	$

        To the extent that the underwriters sell more than 21,052,632 shares of common stock, the underwriters have the option to purchase up to an additional 3,157,894 shares from the selling stockholders at the initial public offering price less the underwriting discount.

        The underwriters expect to deliver the shares against payment in New York, New York on                    , 2003.

Credit Suisse First Boston Goldman, Sachs & Co.

Deutsche Bank Securities

Banc of America Securities LLC

                                                                      Citigroup

JPMorgan

Prospectus dated                    , 2003.

[Front Inside Cover Description: Pictures of representative customers and of SIRVA's employees performing some of SIRVA's services, with a list of services offered]

[Front Cover Fold-Out Description: Map of world depicting SIRVA Relocation, northAmerican, Global, Pickfords, Maison Huet, Adam and Scanvan in the regions in which they operate, as well as triangles indicating where SIRVA's operating centers are located]

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TABLE OF CONTENTS

	Page
Prospectus Summary	1
Summary Consolidated Financial and Other Data	8
Risk Factors	13
Forward-Looking Statements	23
Internal Reorganization and Refinancing	24
Use of Proceeds	25
Dividend Policy	27
Capitalization	28
Dilution	30
Selected Consolidated Financial and Other Data	31
Management's Discussion and Analysis of Financial Condition and Results of Operations	35
The Relocation Industry	66
Business	69
Management	83
Principal Stockholders	101
Selling Stockholders	104
Certain Relationships and Related Transactions	106
Description of Our Indebtedness	111
Description of Capital Stock	117
Shares Eligible for Future Sale	121
Material U.S. Federal Tax Considerations	123
Underwriting	126
Legal Matters	129
Experts	129
Where You Can Find More Information	129
Index to Financial Statements	F-1

No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus. You must not rely on any unauthorized information or representations. This prospectus is an offer to sell or buy only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date.

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PROSPECTUS SUMMARY

The following is a summary of some of the information contained in this prospectus. It may not contain all the information that is important to you. To understand this offering fully, you should read carefully the entire prospectus, including "Risk Factors" beginning on page 13 and our consolidated financial statements and notes to those consolidated financial statements included in this prospectus, before making any investment decision. In this prospectus, the terms "SIRVA," "we" and "our" refer to SIRVA, Inc. and its subsidiaries and their respective predecessors in interest, unless the context otherwise requires. When we refer to "North American Van Lines" or "NAVL," we are referring to our wholly owned subsidiary, North American Van Lines, Inc., together with its subsidiaries and their predecessors in interest, unless the context otherwise requires.

Our Business

        We are a world leader in the global relocation industry, providing our solutions to a well-established and diverse customer base. We handle more than 385,000 relocations per year, including transferring corporate and government employees and moving individual consumers. We operate in 43 countries under well-recognized brand names including Allied®, northAmerican®, Global® and SIRVA Relocation in North America, Pickfords® in the U.K., Maison Huet® in France, Scanvan® in Scandinavia and Allied Pickfords in the Asia Pacific region. We are redefining the global relocation market by combining our relocation service offerings with our proprietary moving services network on a global basis. This unique combination is driving our growth by addressing our corporate and government customers' needs for a comprehensive service offering with global reach from a single supplier. In addition, we offer a variety of services targeted at meeting the needs of truck drivers, fleet owners and agents, both inside and outside our proprietary agent network.

        Our service offerings include the following:

Global Relocation Solutions		Network Services
Home Sale	High-Value Products Moving	Insurance
Household Goods Moving	Storage	Vehicle Repair and Maintenance
Home Purchase	Office Moving	Group Purchasing Organization
Mortgage Services	Records Management	Fuel and Tire Discount Programs
Expatriate Services	Visa and Work Permits
	Expense Management

        The market for relocation and related services is large and highly fragmented. We estimate that the worldwide aggregate annual value of these services provided by in-house and third party providers is more than $50 billion. We are a leader in the outsourced portion of this market. The outsourcing of relocation services has been increasing, driven by the administrative and cost efficiencies and superior service levels offered by outside providers. We believe that, over time, third party providers will continue to increase their share of corporate relocation spending.

        Our financial results reflect our ability to improve our operating results even in a difficult economic environment. For the twelve months ended September 30, 2003, we had operating revenues and income from operations of $2.3 billion and $114.1 million, respectively. These represent increases of 9% and 37% over our operating revenues and income from operations for the twelve-month period ended September 30, 2002, respectively, resulting from a combination of internally generated and acquisition growth.

        Our business operates in four segments: Relocation Solutions — North America, Relocation Solutions — Europe & Asia Pacific, Network Services and Transportation Solutions. We sometimes refer to our Relocation Solutions — North America and Relocation Solutions — Europe & Asia Pacific segments together as Global Relocation Solutions.

Income from Operations by Segment for the twelve months ended September 30, 2003	Income from Operations by Geography for the twelve months ended September 30, 2003

Global Relocation Solutions.

        We offer a comprehensive suite of relocation solutions to our more than 2,500 corporate and government customers around the world, providing a wide variety of services including the sale of employees' homes, movement of their household goods, purchase of their new homes and provision of destination services. In addition, we provide our corporate customers with moving services for products that require special handling and constant monitoring due to their high value. Our relocation solutions services are provided by a team of over 6,000 employees around the world and a network of agents and other service providers.

        While most of the corporate relocations originate from the U.S. and the U.K., our relocation services are provided through our operating centers throughout the world to meet the global relocation needs of our corporate customers: five in the U.S., four in the U.K., two in Australia and one in Hong Kong. In each of these locations, our customer service and account management personnel interact with our corporate clients and their transferring employees on a regular basis.

        Our moving services for our corporate, military/government and consumer markets are provided through our worldwide proprietary agent network. Our corporate, military/government and consumer businesses around the world completed approximately 155,000, 46,000 and 186,000 relocations in 2002, respectively.

        In North America, we provide our moving services through our proprietary branded network of 780 agents who own the trucks and trailers used in moves and are responsible for packing, hauling, storage and distribution of household goods. We act as a network manager for our agents, providing, among other things, brand management, load optimization, billing, collection and claims handling. Outside of North America, we provide moving services through a network of company-owned and agent-owned locations in Europe and the Asia Pacific region.

Network Services.

        We offer a variety of services targeted at meeting the needs of truck drivers, fleet owners and agents, both inside and outside our network. We developed these services using the knowledge of the needs of truck drivers, fleet owners and agents that we have accumulated from managing our proprietary agent network, operating our own fleets and drivers and from our frequent interactions with independent owner-operators.

        Services offered include insurance coverage such as vehicle liability, occupational accident, physical damage, and inland marine insurance coverage, as well as truck maintenance and repair services and group purchasing. In addition, we offer a suite of services including fuel, cell phone, tire services, legal assistance and retirement programs to the members of the National Association of Independent Truckers, an association of independent contract truck drivers we acquired in April 2002. This association currently has approximately 24,800 owner-operator members, and we believe there is substantial opportunity for continued growth.

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Transportation Solutions.

        Our transportation solutions business provides inventory management solutions, using proprietary asset management technology, to coordinate a variety of services such as order fulfillment, project-specific delivery management, and the tracing of products through customers' supply chains.

Our Competitive Strengths

        Global Industry Leader.    Our history in the industry, together with our relentless focus on delivering high-quality service and innovative solutions to our customers, have made our brands among the most recognized and trusted in the industry. We believe that we are the fastest growing global provider of relocation services, due in part to our high levels of customer satisfaction. Our Allied and northAmerican brands were each ranked in the top three most recognized brand names in the U.S. moving industry in 2001, and had 18% and 13% market share in the U.S. moving industry in 2002. We believe that our Pickfords brand is a leading moving services brand in the U.K. and that Scanvan is a market leader in the Scandinavian market. With relocation operating centers in Chicago, Denver, Connecticut, Minneapolis, Cleveland, the U.K., Hong Kong and Australia and relocation service counselors and coordinators speaking over 30 languages, we can handle clients relocating to and from virtually anywhere in the world.

Worldwide	Worldwide	North America	North America
est. 2002	est. 1928	est. 1933	est. 1957

United Kingdom	Asia Pacific	France	Scandinavia
est. 1756	est. 1926	est. 1898	est. 1894

        Comprehensive Relocation Solutions.    We can deliver our relocation services through a single point of contact, which provides our corporate customers and their employees with high quality service at a low cost. Our single source solution offers an attractive value proposition for corporations looking to reduce the administrative costs and burdens associated with employee relocations. As a leading global relocation solutions provider with a proprietary global moving services fulfillment network, we are able to provide moving capacity and quality to customers even during periods of peak demand. Our product breadth allows us to deliver innovative and tailored solutions to better meet our customers' needs. For example, we offer both a traditional cost-plus model to corporate customers and a fixed fee alternative, set as a percentage of the value of a relocating employee's home. Our fixed fee alternative is gaining increasing recognition and usage from our clients who seek to reduce their overall cost and risk.

        Diverse and Stable Revenue Base.    We believe that the diversified nature of our business, which results from our geographic reach, range of product offerings and broad customer base, creates a stable business platform with predictable service volumes that mitigates the effects of economic cycles. During 2002, no single customer, other than the U.S. military/government, accounted for more than 2% of our operating revenues. The U.S. military/government business comprised approximately 7% of our operating revenues in 2002, generated from services provided to over 150 military bases and 65 government service agencies worldwide each of which typically makes

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its own carrier selection. The following table of our 2002 relocations illustrates the global breadth and diversity of our relocation business:

		North America	Europe	Asia Pacific	Total
		(rounded to nearest thousand)
Corporate		94,000	25,000	36,000	155,000
Military/Government		41,000	2,000	3,000	46,000
Consumer		128,000	39,000	19,000	186,000
	Total	263,000	66,000	58,000	387,000

        Attractive Financial Model.    Our business has several attractive financial features, including:

•

Strong Cash Flow and Low Capital Requirements.    Due to our asset-light business model, limited need for additional working capital as we grow and moderate capital expenditures, our business generates strong cash flows that are available for reinvestment in our business, debt service, acquisitions and other uses.



•

Positioned to Benefit from an Improving Economy.    With our strong market share among corporate customers, we believe that we are well positioned to benefit from any increased volume of corporate relocations that may result from an improving economy. We expect that increases in the volume of our relocations should result in high incremental operating profit because our infrastructure can support significant growth without a proportional increase in expenditures.



•

Multiple Opportunities for Profitable Growth.    Our broad base of corporate customers, wide range of product and service offerings and geographic breadth provide multiple opportunities to grow profitably.

Our Strategies

        We intend to focus on the following strategies to grow our revenues and profits:

Grow Relocation Solutions.

•

Cross-Sell Services to Existing SIRVA Customers.    We believe that cross-selling our full suite of relocation solutions to our existing U.S. corporate customers represents a very substantial growth opportunity. Of our 2,500 corporate customers in 2002, only 106 purchased both relocation and moving services from us. We believe that we have the opportunity, on average, to more than triple our revenue from a customer by converting it from one utilizing only our moving services to one using our combined offering of moving and relocation services. To address this opportunity, we have realigned our corporate sales and marketing functions, as well as our agents, to better present this combined service offering to our corporate customers around the world.



•

Grow Corporate Customer Base.    We intend to continue to use our comprehensive product offering, high customer satisfaction ratings, well-recognized brands and the trend towards corporate outsourcing to grow our corporate customer base and increase our share of our existing customer base. In the nine months ended September 30, 2003, we won 191 contracts from corporate customers, 18 of which contracted to purchase both moving and relocation services. These contracts helped drive our growth in the first nine months of 2003 and they are expected to be a major driver of growth in 2004, although there can be no assurances because many of these contracts are terminable by the customer on short notice and none of them specify a minimum transaction volume.



•

Expand Geographically.    We intend to increase our market share internationally as we continue to develop our global relocation solutions platform. We believe that the European and Asian market opportunities are considerable, as the markets are large and the corporate outsourcing trend is at an earlier stage of development. We are approaching this international opportunity from a position of strength, with a leading market share position in Europe, Australia and Asia.

        Grow Network Services.    We intend to continue to grow our network services business as we focus on the needs of our agents, independent owner-operators and small fleet owners. We have accumulated a deep knowledge

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of this market from managing our proprietary agent network, operating our own fleets and drivers around the world and from frequent interactions with independent owner-operators. This gives us an advantage in bringing value-added services, like our insurance programs, to this historically underserved market. In addition, our ability to grow our independent owner-operator driver base has been enhanced by our acquisition of the National Association of Independent Truckers in 2002, whose membership has grown from approximately 13,300 members in April 2002, when we acquired NAIT, to approximately 24,800 as of September 30, 2003.

        Continue to Improve Operating Efficiency.    We continually seek to improve our financial and operating performance through cost savings and productivity improvements. Our operating revenues per employee for the 12 months ended September 30, 2003 were 12% higher than they were for the 12 months ended September 30, 2002. We are very focused on improving our cost position in every area of our business. We continuously drive variable cost and fixed cost productivity across each business segment and believe there is significant potential to increase productivity in the future.

        Pursue Targeted Acquisitions.    We have a history of successfully integrating acquisitions to fill out our service offerings and geographic needs. Our industry expertise and brand strength have enabled us to improve the performance of the companies we acquire. We will continue to target opportunistic acquisitions that appropriately expand our capabilities.

Corporate History

        Clayton, Dubilier & Rice Fund V Limited Partnership, our majority stockholder, organized us to acquire North American Van Lines, which we acquired on March 29, 1998. North American Van Lines was originally organized in 1933. Since 1998, we have completed other acquisitions, including the acquisition of the Allied and Pickfords businesses from Exel plc on November 19, 1999. As we built our strength in moving services, we saw a significant opportunity to use this strength to become a leading provider of comprehensive relocation services for our corporate moving customers. To take advantage of this opportunity, we added comprehensive relocation capabilities in 2002 through our acquisitions of the relocation services businesses of Cooperative Resource Services, Ltd., now known as SIRVA Relocation, and Rowan Simmons Relocation Ltd.

*              *              *

Principal Stockholders

        Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership own approximately 56.6% and 23.5% of our outstanding common stock, respectively, and will own approximately 39.2% and 16.3%, respectively, following the completion of this offering. They are private investment funds managed by Clayton, Dubilier & Rice, Inc. Of the ten members of our Board of Directors, two are principals of Clayton, Dubilier & Rice, Inc.

        *              *              *

        Our principal executive offices are located at 700 Oakmont Lane, Westmont, Illinois 60559. Our phone number is (630) 570-3000.

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The Offering

Shares of common stock offered by SIRVA.	13,157,895
Shares of common stock offered by selling stockholders	7,894,737
Shares of common stock outstanding after the offering	70,084,748
Use of proceeds	Our net proceeds from this offering, after deducting underwriting discounts and estimated offering expenses, will be approximately $232.4 million. We intend to use most of our net proceeds from this offering, together with the net proceeds of the refinancing described below, to purchase or repay a portion of our outstanding debt and our junior exchangeable preferred stock. We will not receive any proceeds from the sale of shares by the selling stockholders.
New York Stock Exchange Symbol	SIR

    Unless we specifically state otherwise, all information in this prospectus:

•

assumes no exercise of the over-allotment option granted by the selling stockholders to the underwriters;



•

assumes consummation of the refinancing on the terms described in "Internal Reorganization and Refinancing", "Use of Proceeds" and "Description of our Indebtedness";



•

excludes 4,560,072 shares of common stock issuable upon the exercise of outstanding stock options at a weighed average exercise price of $4.66 per share with exercise prices ranging from $3.15 to $5.84 per share; of these shares, 1,321,847 shares are subject to currently vested stock options at a weighted average exercise price of $4.16 per share with exercise prices ranging from $3.15 to $4.48 per share; and



•

excludes 2,773,116 shares of common stock issuable upon the exercise of the outstanding warrant issued to an affiliate of Exel plc at an exercise price of $12.62 per share.

        On November 7, 2003, our Board of Directors approved a stock split of 3.17 for 1 of our common stock by way of a reclassification that will become effective prior to consummation of this offering. The reclassification will be effected through a restated certificate of incorporation, which we filed with the Secretary of State of the State of Delaware on November 10, 2003. The restated certificate of incorporation will also increase the number of authorized shares of our common stock to 500,000,000. Our Board of Directors and our stockholders approved the restated certificate of incorporation on November 7, 2003. Accordingly, all share and per share information in this prospectus give effect to the reclassification.

Internal Reorganization and Refinancing

Internal Reorganization

        In connection with this offering, we intend to effect an internal reorganization pursuant to which we would incorporate a new direct wholly-owned subsidiary, SIRVA Worldwide, Inc., which in turn would own directly all of the issued and outstanding capital stock of North American Van Lines. We may also effect transactions pursuant to which Allied Van Lines, Inc. and North American International Holding Corporation, which are currently direct wholly-owned subsidiaries of North American Van Lines, would become direct wholly-owned subsidiaries of SIRVA Worldwide, Inc.

Credit Agreement Refinancing

        In connection with this offering, we intend to effect a refinancing of the existing senior credit facility of our wholly owned subsidiary, North American Van Lines, with a new senior credit facility. The commitments provided by the proposed lenders for the new senior credit facility provided for North American Van Lines and one or more

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of its foreign subsidiaries to be the borrowers under the facility. In connection with the planned internal reorganization, we are in discussions with the lenders to provide that SIRVA Worldwide, Inc. will be the primary borrower under the new senior credit facility, with one or more of its foreign subsidiaries to be additional borrowers. Upon consummation of this refinancing, we expect that the borrowers thereunder will have outstanding borrowings under the new senior credit facility of $459.7 million, representing an increase of $64.4 million, as of September 30, 2003. Of these borrowings, we expect that $425.0 million will be in the form of a term loan and $34.7 million will be drawn initially under the $175.0 million revolving portion of the new senior credit facility. As a result of this refinancing, we expect to realize significantly lower interest expense.

Note Repurchase

        We have commenced a tender offer for all of the 13³/8% senior subordinated notes due 2009 issued by North American Van Lines. We will use the net proceeds from this offering and borrowings under the new senior credit facility to finance the note repurchase. To the extent that we purchase less than all of the senior subordinated notes under the tender offer, our initial borrowings under the revolving portion of the new senior credit facility will be less than currently anticipated. In connection with the tender offer, North American Van Lines has received the requisite consents to remove substantially all of the restrictive covenants and certain other provisions from the indenture governing its senior subordinated notes. As of October 31, 2003, approximately 93% of the notes had been tendered.

        See "Internal Reorganization and Refinancing", "Use of Proceeds", "Capitalization" and "Description of our Indebtedness".

        This offering is not conditioned upon the completion of the refinancing. We cannot assure you that the anticipated refinancing will be completed on the terms anticipated, or at all.

Risk Factors

        You should consider carefully all the information included in this prospectus and, in particular, the specific factors set forth under "Risk Factors" beginning on page 13 for risks involved in investing in our common stock.

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SUMMARY CONSOLIDATED FINANCIAL AND OTHER DATA

        The following table presents our summary consolidated financial and other data as of and for the periods indicated. You should read the following financial information in conjunction with "Capitalization," "Selected Consolidated Financial and Other Data," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the notes to those financial statements appearing elsewhere in this prospectus. Share and per share information set forth below have been adjusted to reflect the split of each share of our common stock into 3.17 shares of common stock by way of reclassification that was approved by our Board of Directors on November 7, 2003 and that will become effective prior to the consummation of this offering.

        We derived our summary consolidated statement of operations data for each of the years in the three year period ended December 31, 2002 from our audited consolidated financial statements included elsewhere in this prospectus. Our summary consolidated balance sheet and statement of operations data as of and for the nine months ended September 30, 2003 and our summary consolidated statement of operations data for the nine months ended September 30, 2002, respectively, are derived from our unaudited condensed consolidated financial statements included elsewhere in this prospectus. The unaudited condensed consolidated financial statements reflect all adjustments, including usual recurring adjustments, which in the opinion of management, are necessary for the fair presentation of that information as of and for the periods presented. Our results for the interim periods are not necessarily indicative of the results that you should expect for the full year or in the future. The pro forma net income and pro forma net income per share for the year ended December 31, 2002 and the nine months ended September 30, 2003, reflect the application of our expected net proceeds from the initial public offering and the refinancing of North American Van Lines' senior credit facility to repay a portion of our outstanding indebtedness, to repurchase North American Van Lines' senior subordinated notes and redeem our junior exchangeable preferred stock as if these events had occurred on January 1, 2002 and January 1, 2003, respectively. The pro forma consolidated balance sheet data give effect to these events as if they had occurred on September 30, 2003.

		Years Ended December 31,									(Unaudited) Nine Months Ended September 30,
		2000			2001			2002			2002			2003
		(Dollars in millions except share and per share data)
Statement of Operations Data:
Operating revenues(1)
	Relocation Solutions—North America	$	1,791.8		$	1,652.1		$	1,544.4		$	1,173.1		$	1,240.4
	Relocation Solutions—Europe & Asia Pacific		372.8			387.1			408.0			300.1			350.9
	Global Relocation Solutions		2,164.6			2,039.2			1,952.4			1,473.2			1,591.3
	Network Services		75.8			84.2			125.0			89.9			117.9
	Transportation Solutions		138.3			125.9			108.2			82.5			76.0
Total Operating Revenues		$	2,378.7		$	2,249.3		$	2,185.6		$	1,645.6		$	1,785.2
Purchased Transportation Expense(1)		$	1,559.8		$	1,438.8		$	1,303.2		$	990.6		$	1,002.1
Other direct expense		$	433.8		$	426.4		$	463.9		$	343.5		$	429.9
Gross margin		$	385.1		$	384.1		$	418.5		$	311.5		$	353.2
Income from operations(2)
	Relocation Solutions—North America	$	8.1		$	15.1		$	41.0		$	35.2		$	44.9
	Relocation Solutions—Europe & Asia Pacific		23.7			26.0			24.8			17.2			23.8
	Global Relocation Solutions		31.8			41.1			65.8			52.4			68.7
	Network Services		17.4			18.5			26.5			17.9			26.1
	Transportation Solutions		0.3			(6.3	)		3.3			3.8			1.8
	Corporate		(0.1	)		(0.8	)		(1.3	)		(1.0	)		(3.7	)
Total income from operations		$	49.4		$	52.5		$	94.3		$	73.1		$	92.9
Net income (loss)(2)		$	(21.9	)	$	(16.9	)	$	20.8		$	17.0		$	30.9
Pro Forma Information:
	Pro forma net income(2)(3)							$	41.7			—		$	48.1
Per Share Data:
Net income (loss) per share—basic(2)(4)		$	(0.68	)	$	(0.48	)	$	0.33		$	0.29		$	0.51
Net income (loss) per share—diluted(2)(4)		$	(0.68	)	$	(0.48	)	$	0.33		$	0.28		$	0.48

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Weighted average common shares outstanding
	Basic	39,065,685	42,308,361	51,712,625	50,182,133	56,670,610
	Diluted	39,065,685	42,308,361	51,832,236	50,299,401	59,200,118

		Years Ended December 31,									(Unaudited) Nine Months Ended September 30,
		2000			2001			2002			2002			2003
		(Dollars in millions except percentage, share and per share data)
Pro forma net income per share(2)(3)(5):
	Basic							$	0.64					$	0.69
	Diluted							$	0.64					$	0.66
Other Data:
EBITDA(2)(6)		$	103.6		$	100.9		$	137.8		$	103.7		$	128.0
Capital expenditures			55.4			48.3			33.5			25.0			17.4
Depreciation and amortization(7)			53.9			48.7			44.2			30.9			35.0
Gross margin as a percentage of operating revenues			16.2	%		17.1	%		19.1	%		18.9	%		19.8	%

	As of September 30, 2003
	Actual		Pro Forma As Adjusted(2)
	(Dollars in millions)
Balance Sheet Data:
Cash and cash equivalents	$	60.7	$	60.7
Property and equipment, net		173.8		173.8
Total assets(8)		1,583.7		1,578.1
Long-term debt(9)		622.0		478.8
Stockholders' equity(10)		158.8		376.0

(1)

Our operating revenues represent amounts billed to our customers for all aspects of the services that we provide. Where we fulfill the transportation service element using our independent agent network or other third-party service providers, we incur purchased transportation expense, or PTE, which is included in the amount billed to our customer. The level of PTE generally increases or decreases in proportion to the operating revenues generated from our transportation services.

(2)

For the nine months ended September 30, 2003, we recognized $3.0 million of non-cash equity-based compensation expense in relation to stock subscriptions and stock option grants made to certain managers and directors in June and August 2003. The expense has been recorded as the difference between the subscription or exercise price and the deemed fair value of our common and redeemable common stock on the date of grant in accordance with APB 25. The total non-cash equity-based compensation expense to be recognized by us in respect of these transactions is $6.7 million. We expect to recognize $0.5 million in the fourth quarter of 2003 and $1.5 million, $0.8 million, $0.5 million, $0.3 million and $0.1 million in each of 2004, 2005, 2006, 2007 and 2008, respectively.

(3)

Pro forma information reflects the application of our estimated net proceeds from the initial public offering and the refinancing of North American Van Lines' senior credit facility to reduce our indebtedness by

9

$154.0 million and $165.2 million based upon outstanding balances as of December 31, 2002 and September 30, 2003, respectively. Pro forma net income, as if these events had occurred on January 1, 2002 and January 1, 2003, is calculated as follows:

			Year ended December 31, 2002			Nine months ended September 30, 2003
			(Dollars in millions)
Net income as reported(2)			$	20.8		$	30.9
Add back:
	Finance charges associated with existing indebtedness
		Senior subordinated notes		20.1			15.0
		Tranche A senior term loan		6.2			3.7
		Tranche B senior term loan		11.6			8.2
		Revolving credit facility borrowings		3.0			2.6
		Senior discount loan		8.4			6.9
		Seller notes		1.0			1.2
		Junior exchangeable preferred stock		—			0.9
		Amortization of deferred debt issuance costs		3.2			2.5
				53.5			41.0
Less:
	Pro forma finance charges associated with new indebtedness
		Senior term loan		(18.1	)		(11.9	)
		Revolving credit facility borrowings		(1.3	)		(1.8	)
		Amortization of deferred debt issuance costs		(1.2	)		(0.9	)
				(20.6	)		(14.6	)
	Income taxes			(12.0	)		(9.2	)
Pro forma net income			$	41.7		$	48.1

The pro forma finance charges have been derived from applying the average LIBOR interest rate outstanding during the year ended December 31, 2002 of 1.765% and during the nine months ended September 30, 2003 of 1.237% plus an assumed interest rate margin of 2.25% on the revolving credit facility and 2.50% on the term loan associated with the new senior credit facility. The cost associated with the new credit facility will be capitalized and amortized over the life of the new credit facility.

The pro forma income taxes have been derived from applying historical U.S. statutory tax rates to the anticipated interest and deferred debt amortization savings. The tax rates take into consideration non-deductible components of interest expense, and are 36.7% for the year ended December 31, 2002 and 33.9% for the nine months ended September 30, 2002 and the nine months ended September 30, 2003.

The above analysis assumes that $150 million principal amount of the outstanding North American Van Lines senior subordinated notes will be repurchased. In the event that we do not repurchase all of the notes, our net income may be less. As of October 31, 2003, approximately 93% of the notes had been tendered.

(4)

We adopted Statement of Financial Accounting Standard ("SFAS") SFAS No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142") with effect from January 1, 2002. In accordance with SFAS 142, we no longer amortize goodwill and indefinite-lived intangibles, but rather will test such assets at least annually for impairment. We have completed the first step of the impairment test under the transitional requirements of SFAS 142 and no impairment of goodwill or indefinite-lived intangibles was indicated. If previously reported net income and earnings per share were adjusted for the exclusion of goodwill and indefinite-lived intangibles amortization, basic net income (loss) per ordinary share would have been $(0.42) and $(0.25) for the years ended December 31, 2000 and 2001, respectively, and diluted net income (loss) per ordinary share would have

10

been $(0.42) and $(0.25) for the years ended December 31, 2000 and 2001, respectively. For further information, see note 6 to "Selected Consolidated Financial and Other Data" and note 6 to our consolidated financial statements included elsewhere in this prospectus.

(5)

Pro forma net income per share—basic and diluted is calculated using pro forma weighted average common shares outstanding—basic of 64,870,520 and 69,828,505 and pro forma weighted average common shares outstanding—diluted of 64,990,131 and 72,358,013 as of December 31, 2002 and September 30, 2003, respectively on a post split basis, and reflecting the impact of the issuance of 13,157,895 shares on completion of this offering.

(6)

EBITDA is defined as net income (loss) before interest, taxes, depreciation and amortization.

        EBITDA is calculated as follows:

	Year Ended December 31,								Nine Months Ended September 30,
	2000			2001			2002		2002		2003
	(Dollars in millions)
Net income (loss)	$	(21.9	)	$	(16.9	)	$	20.8	$	17.0	$	30.9
Interest expense		73.4			69.2			61.2		44.9		45.9
Provision (benefit) for income taxes		(1.8	)		(0.1	)		11.6		10.9		16.2
Depreciation		38.0			33.5			35.9		25.9		27.7
Amortization		15.9			15.2			8.3		5.0		7.3
EBITDA	$	103.6		$	100.9		$	137.8	$	103.7	$	128.0

We believe that EBITDA is a relevant measurement for assessing performance since it attempts to eliminate variances caused by the effects of differences in taxation, the amount and types of capital employed and depreciation and amortization policies. EBITDA is not a measure determined in accordance with generally accepted accounting principles and should not be considered by investors as an alternative to income from operations or net income as an indicator of our performance. The EBITDA disclosed here is not necessarily comparable to EBITDA disclosed by other companies because EBITDA is not uniformly defined.

For the nine months ended September 30, 2003, we recognized $3.0 million of equity-based compensation expense. See Note 2 above.

(7)

Includes depreciation expense for property and equipment and amortization expense for intangible assets and deferred agent contract expenditures. Excludes amortization expense for deferred debt issuance costs, which are recorded as part of interest expense.

(8)

The decline in total assets of $5.6 million is due to the write-off of unamortized deferred debt issuance costs of $13.6 million associated with the existing credit facility partially offset by deferred debt issuance costs of $8.0 million associated with the new senior credit facility.

(9)

Long-term debt consists of (i) long-term debt excluding the current portion of long-term debt, (ii) capital lease obligations and (iii) amounts outstanding under the revolving credit facility forming part of our senior credit facility. See "Capitalization" for an additional explanation of the calculation of pro forma long-term debt included elsewhere in this prospectus.

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(10)

Pro forma as adjusted stockholders' equity reflects the following adjustments (dollars in thousands):

Issuance of new common stock and associated additional paid-in capital in connection with this offering			$	250,000
Reclassification of redeemable common stock as common stock and corresponding increase in additional paid-in capital				11,528
Capitalized fees associated with this offering				(17,625	)
Write off of unrecognized hedging losses associated with open interest rate swap agreements, net of tax				2,288
Tender premium on $150,000 senior subordinated notes	(27,000	)
Write off of deferred debt issuance costs on existing senior credit facility	(13,592	)
Write off of unrecognized hedging losses associated with open interest rate swap agreements	(3,520	)
	(44,112	)
Income taxes	15,152
Adjustment to accumulated deficit				(28,960	)
Pro forma adjustments to stockholders' equity			$	217,231

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RISK FACTORS

An investment in our common stock involves a high degree of risk. You should carefully consider the following information about these risks, together with other information in this prospectus, before buying shares of our common stock. If any of the following risks or uncertainties actually occurs, our business, financial condition and operating results could be materially and adversely affected. The trading price of our common stock could decline and you may lose all or part of the money you paid to buy our common stock. This prospectus also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in those forward-looking statements as a result of certain factors including the risks faced by us described below and elsewhere in this prospectus. See "Forward-Looking Statements" on page 23.

Risks Relating to Our Company

If we do not successfully compete within the highly competitive industries in which we operate, our operating revenues and profitability could be adversely affected.

        The global relocation industry is highly competitive. In relation to relocation services, our main competitors are other corporate relocation service providers such as Prudential Financial and Cendant Mobility who are larger than us, have been in the business longer and are also our two biggest customers of our moving services business. The moving services industry is extremely fragmented. We compete primarily with other large moving companies such as Atlas Van Lines Inc., United Van Lines, Inc. and Mayflower Transit, Inc., as well as truckload carriers and independent contractors and, with respect to certain aspects of our business, intermodal transportation, railroads and less-than-truckload carriers. There are many small private participants that have strong positions in local markets. Intermodal transportation (the hauling of truck trailers or containers on rail cars or ships) has increased in recent years as reductions in train crew size and the development of new rail technology have reduced costs of intermodal shipping. The segment of the insurance services business in which we operate is also highly competitive. Our main competitors include Vanliner, Royal & Sun Alliance and Protective Insurance Company.

Competition may force us to lower our prices thereby adversely affecting our operating revenues and profitability.

        Competition in the relocation solutions and insurance industries and potential new entrants into these industries may force us to lower our prices, thereby affecting our operating revenues and profitability. If we do not successfully compete within these highly competitive industries, we will lose customers, in which case our operating revenues and profitability would also be adversely affected. As we are subject to intense competition, we may not be able to achieve our growth objectives in a timely fashion, if at all.

Our business and financial condition could continue to be adversely affected by the present economic downturn and could also be adversely affected by future economic downturns and other external events.

        We serve numerous industries and customers that experience significant fluctuation in demand based on economic conditions and other factors beyond our control. As our operating results are subject to customer demand, a downturn in the business of our corporate customers or a decrease in the frequency of household moves could materially adversely affect the performance of our business. For instance, our results of operations were negatively impacted by the recent economic decline, with both the number of relocations and operating revenues decreasing on a year-over-year basis for each of the past two fiscal years, even though we consummated acquisitions during each such period. Our number of corporate relocations in the U.S. has declined each year since 2000, falling approximately 30% from the year ended December 31, 2000 to the year ended December 31, 2002.

        Similarly, terrorist attacks or other acts of violence or war may affect the financial markets, in general, or our business, financial condition and results of operation, in particular. We cannot assure you that there will not be future terrorist attacks against the United States or U.S. businesses. Any such attacks or armed conflict may directly affect our physical facilities or those of our customers and vendors. In addition, these events could cause consumer confidence and spending to decrease or could result in increased volatility in the U.S. and world financial markets and economy.

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Until recently, we had a history of net losses, and may not be profitable in the future.

        We had net losses of $20.5 million, $21.9 million and $16.9 million for the years ended December 25, 1999, December 31, 2000 and December 31, 2001, respectively. We cannot assure you that we will not report net losses in future periods. We cannot predict what impact continued net losses might have on our ability to finance our operations in the future or on the market value of our common stock.

Our success depends in part on our relatively new and unproven strategy of offering a global comprehensive relocation solution to customers.

        Historically, a majority of our operating revenues and income from operations was derived from our moving services businesses. A significant element of our growth model, however, is our new and unproven strategy of offering a global comprehensive relocation solution to customers by combining our higher margin relocation services with our proprietary moving services network. We embarked on this strategy less than two years ago with the acquisition of the business of Cooperative Resources Services, Ltd., and have not yet proven that it will succeed in the long-term, especially in Europe and Asia.

Our global relocation solutions business exposes us to some of the risks of the real estate industry, including risks relating to the purchase, ownership and resale of transferred employees' homes at a loss.

        The growth of our relocation solutions business exposes us to the risks of engaging in the real estate business. As part of our global relocation solutions package, we offer corporate customers home purchase and sale services for their employees. If a transferee's home cannot be sold within a given period of time, we may have to purchase the home for our own account and we may ultimately have to sell the home to a third party at a loss. In addition, a decline in the volume or value of existing home sales due to adverse economic changes could increase the number of homes that we may have to purchase and we may have to sell those homes at a loss for our own account thereby adversely affecting our results of operations. Further, we offer mortgage origination services to the employees of our corporate customers, which we fund through a warehouse mortgage facility thereby potentially increasing our own level of debt.

Our network services business exposes us to some of the risks of the insurance industry.

        In connection with our network services business, we have a wholly-owned subsidiary insurance company organized under the laws of Illinois named Transguard Insurance Company of America, Inc. The potential for growth of our network services may be offset by the risks of engaging in the insurance business. Investment returns are an important part of the overall profitability of our insurance business, and therefore fluctuations in the fixed income or equity markets could have a material adverse affect on our results of operations. Our investment returns are also susceptible to changes in the general creditworthiness of the specific issuers of debt securities and equity securities held in our portfolio. Where the credit rating of an issuer falls so low that we are forced by regulatory bodies to dispose of our investment, we may realize a significant loss on our investment.

        The reserves we maintain in our insurance business may prove to be inadequate to cover our actual losses sustained. Claims reserves do not represent an exact calculation of liability, but rather are estimates of the expected liability. To the extent that reserves are insufficient to cover actual losses, loss adjustment expenses or future policy benefits, we would have to add to our claim reserves and incur a charge to our earnings.

        Transguard is a party to reinsurance agreements pursuant to which it cedes the liabilities under a portion of its issued insurance policies. These agreements may be terminated by the reinsurer upon notice or upon a change of control of our insurance subsidiary. If any of these reinsurance agreements are terminated, we cannot assure you that we can replace them on short notice or on favorable terms, in which case our exposure to claims under the underlying policies would be increased.

        The A.M. Best rating of Transguard was recently downgraded from A to A- and has been placed under review with negative implications due, in large part, to our financial leverage prior to this offering. A.M. Best expects to resolve the under review status by the end of 2003 and we are taking steps to address its concerns. However, there can be no assurance that we will be successful in doing so, or that the steps we take will not have an adverse effect

14

on us. In addition, we can provide no assurance that Transguard's rating will not be downgraded again in the future. Any such downgrade could affect the marketability of the insurance policies underwritten by Transguard, from which we derive the vast majority of the income from our network services segment, and thereby adversely affect our profitability.

We may not be able to recruit and retain a sufficient number of agents, representatives or owner/operators to carry out our growth plans.

        Our moving services operations in North America rely on the services of agents to market our services and to act as intermediaries with customers, and on agents and owner/operators to provide a significant portion of our packing, warehousing and hauling services. Although we believe our relationships with our agents and owner/operators are good, we have had some difficulty obtaining or retaining qualified owner/operators in the past.

        Our agents are independent businesses that provide moving and storage services to our and their own customers, and 20 of our 780 agents account for approximately 40% of our moving and storage business. If an agent were to terminate its relationship with us, we may not be able to recruit a replacement to service the same geographic region. Generally, there are few additional new entrants into this business and thus recruiting new agents often requires a conversion of an agent from a competing van line. Competing companies also recruit our agents.

        Owner/operators are independent contractors who own their own trucks and provide hauling and other services. Fluctuations in the economy and fuel prices, as well as a lifestyle that requires drivers to be away from home often from four to eight weeks at a time, create challenges for new entrants to that business. Further, competition for long haul owner/operators is strong among competing moving companies.

        We cannot assure you that we will be successful in retaining our agents or owner/operators or that agents or owner/operators that terminate their contracts can be replaced by equally qualified personnel. A loss in the number of qualified drivers could lead to an increased frequency of accidents, potential claims exposure and, indirectly, insurance costs. Because agents have the primary relationship with customers, we expect that some customers would terminate their relationship with us were the agent that handles such customers' business to terminate its relationship with us. In addition, a loss of agents could impair our ability to guarantee moving capacity to our relocation customers.

Actions taken by our agents may harm our brands or reputation, or result in legal actions against us.

        We believe that our strong brand names, including Allied® and northAmerican®, are among our most valuable assets. Our proprietary network of agents in North America operate their businesses using our brand names, including, in the case of most intrastate moves, without our involvement. Our agents are independent third parties with their own financial objectives and actions taken by them, including breaches of their contractual obligations to us, could harm our brands or reputation, or result in legal actions against us. Any negative publicity associated with our agents may affect our reputation and thereby adversely impact our results of operations.

Potential liability associated with accidents in the trucking industry is severe and occurrences are unpredictable. In addition, an increase in liability, property or casualty insurance premiums could cause us to incur significant costs.

        We use the services of a significant number of drivers in connection with our pick-up and delivery operations, and from time to time such drivers are involved in accidents, including accidents occurring in operations that do not involve us. Potential liability associated with accidents in the trucking industry may be severe and occurrences are unpredictable. We are also subject to substantial exposure due to workers' compensation and cargo claims expense, whether or not injuries or damage occur in the context of a traffic accident.

        We carry insurance to cover liability and workers' compensation claims. We cannot assure you, however, that our insurance will be adequate to cover all of our liabilities. To the extent we were to experience a material increase in the frequency or severity of accidents, cargo claims or workers' compensation claims, or in the unfavorable resolution of existing claims, we might be required to incur substantial costs to cover these claims. In addition, our

15

results of operations would be adversely affected if the premiums for our liability, workers' compensation and casualty claims were to increase substantiality.

If we lost one or more of our government licenses or permits or became subject to more onerous government regulations, we could be adversely affected.

        Our operations are subject to a number of complex and stringent transportation, environmental, labor, employment, insurance and other laws and regulations. These laws and regulations generally require us to maintain a wide variety of certificates, permits, licenses and other approvals. For example, in the U.S., we maintain licenses and permits issued by the Surface Transportation Board, the Federal Motor Carrier Safety Administration and the Department of Transportation as well as the Federal Maritime Commission and insurance and banking regulators. In Europe, we hold "O" (operators) licenses and international transport licenses in 11 countries issued by the relevant local authorities. In the Asia-Pacific region, we hold various commercial vehicle licenses, as well as other licenses for international relocation.

        Our failure to maintain required certificates, permits or licenses, or to comply with applicable laws, ordinances or regulations, could result in substantial fines or possible revocation of our authority to conduct our operations, which in turn could restrict our ability to conduct our business effectively and to provide competitive customer services and thereby have an adverse impact on our financial condition.

        We cannot assure you that existing laws or regulations will not be revised or that new more restrictive laws or regulations will not be adopted or become applicable to us. We also cannot assure you that we will be able to recover any or all increased costs of compliance from our customers or that our business and financial condition will not be materially and adversely affected by future changes in applicable laws and regulations.

We are subject to litigation or governmental investigations as a result of our operations.

        We are subject to litigation resulting from our operations, including litigation resulting from accidents involving our agents and drivers. Such accidents have involved, and in the future may involve, serious injuries or the loss of lives. Such litigation may result in liability to us or harm our reputation. While the impact of this litigation is typically immaterial, there can be no assurance that its impact will not be material in the future.

        We have received grand jury subpoenas issued in connection with an investigation being conducted by attorneys in the Department of Justice (DOJ) Antitrust Division. We are cooperating with this investigation and understand that numerous other companies have received similar subpoenas. We believe that the investigation relates to the transportation of U.S. military members' household goods between the U.S. and foreign countries, which is managed and administered by the Military Transportation and Management Command of the U.S. Army, utilizing private moving companies. While the investigation is ongoing and exposes us to potential criminal, civil, and administrative penalties, it is difficult to predict its outcome with certainty at this time before the government makes its decisions and advises us of them. Management believes that, based on information currently available to it, the investigation's outcome will not have a material adverse impact on our overall operations or financial condition, although there can be no assurance that it will not. Any potential fines, penalties or judgments, however, may have a material impact on our earnings in the period in which they are recognized.

        Some of our moving services operations in Europe are being investigated by European antitrust regulators. The investigations are in the very early stages and involve certain anticompetitive practices. The relevant operations represented less than 1.5% of our consolidated operating revenue in the aggregate for the years ended December 31, 2000, 2001 and 2002, and the nine months ended September 30, 2003. The investigations could expose us to administrative and other penalties. We are cooperating with the investigations which we expect will take several years to complete. Management believes that, based on information currently available to it, the outcome of the investigations will not have a material adverse impact on our overall operations or financial condition, although there can be no assurance that it will not. Any potential penalties, however, may have a material impact on our earnings in the period in which they are recognized.

        For further information, see "Business—Legal Proceedings."

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Contingent or future environmental liabilities could cause us to incur significant costs and adversely affect our operations.

        We are subject to a wide range of environmental laws and regulations under the foreign, U.S., state and local laws that govern our operations. Among other things, these requirements regulate discharges of pollutants into the water, air and land, the use, management and disposal of hazardous substances, and the cleanup of contaminated sites. We could incur substantial costs, including cleanup costs, fines and civil or criminal penalties, third party property damage or personal injury claims, or the reduction or suspension of our operations as a result of violations of or liabilities under environmental laws or non-compliance with the environmental permits required at our facilities. Contaminants have been detected at some of our present or former sites, principally in connection with historical operations. In addition, we own or lease, or in the past have owned or leased, facilities at which underground storage tanks are located, some of which have leaked in the past. We have been, and may in the future be responsible for investigating and remediating contamination at these sites, or at off-site locations where we sent hazardous wastes for disposal. While we regularly make capital and operating expenditures to stay in compliance with environmental laws, future or contingent environmental liabilities, including remediation costs, could have a material effect on our business.

Our business is highly seasonal, which leads to fluctuations in our operating results and working capital needs.

        The relocation business is highly seasonal due to the increase in moving activity during the summer months. With respect to our Global Relocation Solutions business, our results of operations and cash flow fluctuate significantly from quarter to quarter due to the higher shipment amounts associated with the summer months. Certain of our operating expenses are fixed, and cannot be reduced during the fall and winter months when there is decreased demand for relocation services. If we are unable to capitalize on the peak summer season or successfully manage the decreased activity during other parts of the year, our annual performance may be materially adversely affected. The seasonal nature of the moving business results in increased short-term working capital requirements in summer months.

Our owner/operators are currently not considered to be employees by taxing and other regulatory authorities. Should these authorities change their position and consider our owner/operators to be our employees, our costs related to our tax, unemployment compensation and workers' compensation payments could increase significantly.

        From time to time, certain parties, including the Internal Revenue Service, state authorities and the owners/operators themselves, have sought to assert that owner/operators in the trucking industry are employees rather than independent contractors. To date, these parties have not been successful in making these assertions against us. We consider all of our owner/operators to be independent contractors. We cannot assure you that tax authorities will not successfully challenge this position, that interpretations supporting our position will not change, or that federal and state tax or other applicable laws will not change. If owner/operators were deemed to be employees, our costs related to tax, unemployment compensation, and workers' compensation could increase significantly. In addition, such changes may be applied retroactively, and if so we may be required to pay additional amounts to compensate for prior periods.

The international scope of our operations may adversely affect our business.

        We face certain risks because we conduct an international business, including:

•

restrictions on foreign ownership of subsidiaries;



•

tariffs and other trade barriers;



•

political risks; and



•

potentially adverse tax consequences of operating in multiple jurisdictions.

17

        In addition, an adverse change in laws or administrative practices in countries within which we operate or our information systems support and application software development are performed could have a material adverse effect on us.

We are exposed to currency fluctuations, which may have an adverse effect on us.

        A large portion of our operating revenues are from operations outside of the United States. These operating revenues are denominated in the local currency for the country in which our international subsidiaries own their primary assets. Although the majority of expenses are incurred in the same currency in which corresponding operating revenues are generated, we are exposed to fluctuation in foreign currencies in the translation of the applicable currencies into U.S. Dollars. Any appreciation in the value of the U.S. Dollar relative to such currencies could have an adverse effect on us.

Fuel is a significant cost element in the trucking transportation industry. Fuel prices are currently high and may continue to rise and they, and the availability of fuel, have been subject to volatility in the past.

        We utilize numerous trucks and tractor trailers in the performance of day to day services in the household goods, specialized transportation and office moving lines of our business, which are a part of our Global Relocation Solutions business, that are dependent on fuel. We often employ the services of third party transportation providers, particularly owner/operators in the U.S. domestic moving business, who are also dependent on fuel and are subject to variations in fuel prices as a result. We cannot assure you that fuel prices will remain stable, or that supplies of fuel will always be available. Should costs escalate, we may not be able to fully recover the cost increase by increasing the price for our services. Third parties who provide transportation services to us may be unwilling to continue to do so without an increase in compensation. As a result, our operating margins could decrease and thereby adversely affect our profitability.

We are a holding company with no significant independent operations and therefore rely on our subsidiaries to make funds available to us.

        We are a holding company with no significant independent operations and no significant assets other than the capital stock of our subsidiaries, including North American Van Lines. We, therefore, will be dependent upon the receipt of dividends or other distributions from our subsidiaries. North American Van Lines' new senior secured credit facility will contain restrictions on distributions from North American Van Lines to us, other than for certain specified purposes. Our inability to receive funds from our operating subsidiaries could adversely affect our ability to meet our obligations and to make dividend payments and other distributions to holders of our common stock.

We have had substantial existing debt and may incur substantial additional debt in the future, and the agreements governing our debt contain restrictions that could significantly restrict our ability to operate our business.

        As of September 30, 2003, on a pro forma basis after giving effect to this offering, the refinancing of our senior credit facility and the application of proceeds herefrom and therefrom, we would have had total outstanding long-term debt of $478.8 million, total outstanding short-term debt of $108.4 million and shareholders' equity of $376.0 million. However, we may incur additional debt in the future, which would result in a greater portion of our cash flow from operations being dedicated to the payment of principal and interest on our indebtedness, thereby reducing the funds available to us for other purposes.

        Our new senior secured credit facilities will contain a number of significant covenants that, among other things, will restrict our ability to incur additional indebtedness, pay dividends, make acquisitions or engage in mergers or consolidations and make capital expenditures. In addition, under our new senior secured credit facility, we will be required to comply with specified financial ratios and tests, including consolidated leverage ratio and consolidated interest coverage ratio requirements. Compliance with these covenants for subsequent periods may be difficult if current market and other economic conditions deteriorate. See "Description of Our Indebtedness."

        Our ability to comply with the covenants and restrictions contained in our debt instruments may be affected by events beyond our control, including prevailing economic, financial and industry conditions. The breach of any

18

such covenants or restrictions could result in a default or cross default under our debt instruments and would permit the lenders to declare all amounts outstanding thereunder to be due and payable, together with accrued and unpaid interest, and the commitments of our new senior secured lenders to make further extensions of credit under the new credit facilities could be terminated. If we were unable to repay our indebtedness to our senior secured lenders, these lenders could proceed against the collateral securing such indebtedness.

Any difficulties with our information systems or our information systems providers could delay or disrupt our ability to service our customers and impair our competitiveness.

        Sophisticated information systems are vital to our growth and our ability to manage and monitor the flow of goods we are transporting and to provide attractive logistics solutions services, which depend on technologically advanced systems. As these systems are evolving rapidly, we will need to continually enhance them. We may encounter difficulties in enhancing these systems or in integrating new technology into our systems in a timely and cost-effective manner. Such difficulties could have a material adverse effect on our ability to operate efficiently and to provide competitive customer service.

        To compete effectively, we must anticipate and adapt to technological changes and offer, on a timely basis, competitively priced services that meet evolving industry standards and customer preferences. We may choose new technologies that later prove to be inadequate, or may be forced to implement new technologies at substantial cost to remain competitive. In addition, competitors may implement new technologies before we do, allowing such competitors to provide lower priced or enhanced services and superior quality compared to those we provide. This development could have a material adverse effect on our ability to compete.

        Two third party vendors together provide 100% of our information systems infrastructure and, at least, 50% of our application software development, respectively. While we have a disaster recovery plan in conjunction with these vendors, we can provide no assurance that the plan will be adequate in the event of an actual disaster. Adverse conditions affecting the financial condition and other important aspects of these vendors' operations may adversely affect our ability to operate efficiently or to continue operations under certain adverse conditions.

We are dependent on our highly trained executive officers and employees. Any difficulty in maintaining our current employees or in hiring similar employees would adversely affect our ability to operate our business.

        Our operations are managed by a small number of key executive officers. The loss of any of these individuals could have a material adverse effect on us. In addition, our success depends on our ability to continue to attract, recruit and retain sufficient qualified personnel as we grow. Competition for qualified personnel is intense. We cannot assure you that we will be able to retain senior management, integrate new managers, or recruit qualified personnel in the future.

If we acquire any companies or technologies in the future, they could prove difficult to integrate, disrupt our business, dilute stockholder value or have an adverse effect on our results of operations.

        We intend to expand our business primarily through internal growth, but from time to time we may consider strategic acquisitions. Any future acquisition would involve numerous risks including:

•

potential disruption of our ongoing business and distraction of management;

•

difficulty integrating the operations and products of the acquired business;

•

unanticipated expenses related to technology integration;

•

exposure to unknown liabilities, including litigation against the companies we may acquire;

19

•

additional costs due to differences in culture, geographic locations and duplication of key talent; and

•

potential loss of key employees or customers of the acquired company.

        If we make acquisitions in the future, acquisition-related accounting charges may affect our balance sheet and results of operations. We may not be successful in addressing these risks or any other problems encountered in connection with any acquisitions.

Risks Relating to Our Common Stock and This Offering

There currently exists no market for our common stock. We cannot assure you that an active trading market will develop for our common stock. If our stock price fluctuates after this offering, you could lose a significant part of your investment.

        Prior to this offering, there was no public market for shares of our common stock. An active market may not develop following the completion of this offering or, if developed, may not be maintained. We negotiated the initial public offering price with the underwriters. The initial public offering price may not be indicative of the price at which our common stock will trade following completion of this offering. The market price of our common stock may also be influenced by many factors, some of which are beyond our control, including:

•

the failure of securities analysts to cover our common stock after this offering or changes in financial estimates by analysts;

•

announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments;

•

variations in quarterly operating results;

•

loss of a large customer or supplier;

•

general economic conditions;

•

terrorist acts;

•

future sales of our common stock; and

•

investor perceptions of us and the relocation services industry.

        As a result of these factors, investors in our common stock may not be able to resell their shares at or above the initial offering price. In addition, the stock market in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies like us. These broad market and industry factors may materially reduce the market price of our common stock, regardless of our operating performance.

A few significant stockholders control the direction of our business. If the ownership of our common stock continues to be highly concentrated, it will prevent you and other stockholders from influencing significant corporate decisions.

        Following the completion of this offering, Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership will beneficially own approximately 39.2% and 16.3%, respectively, of the outstanding shares of our common stock. As a result, Clayton, Dubilier & Rice Fund V Limited Partnership, together with Clayton, Dubilier & Rice Fund VI Limited Partnership, will continue to exercise control over matters requiring stockholder approval, and control over our policy and affairs, for example, by being able to direct the use of proceeds received from this and future security offerings. In addition, Clayton, Dubilier & Rice, Inc., which manages Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership, will continue to provide us with financial advisory and management consulting services following the completion of this offering and it will be entitled to receive fees, including financial advisory fees, in the future. See "Certain Relationships and Related Transactions."

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        The concentrated holdings of Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership and the presence of Clayton, Dubilier & Rice Fund V Limited Partnership's designees may result in a delay or the deterrence of possible changes in control of our company, which may reduce the market price of our common stock. The interests of our existing stockholders may conflict with the interests of our other stockholders. Our board of directors has adopted corporate governance guidelines that require each director to avoid taking actions or having interests that might result in a conflict of interest with our interests. Each director is required to ethically handle all actual or apparent conflicts of interest between personal and professional relationships, including promptly informing the corporate secretary if such a conflict arises and recusing himself or herself from any discussion or decision affecting his or her personal interests. Accordingly, our directors who are employees of Clayton, Dubilier & Rice, Inc., will be required to recuse themselves from any discussion or decision regarding any transaction with our principal stockholders. In addition, we have adopted a code of business conduct that, among other things, requires our employees to avoid actions or relationships that might conflict or appear to conflict with their job responsibilities or the interests of SIRVA, and to disclose their outside activities, financial interests or relationships that may present a possible conflict of interest or the appearance of a conflict to management or corporate counsel. These guidelines and code do not, by themselves, prohibit transactions with our principal stockholders.

Our ownership of insurance subsidiaries imposes limits on the amount of our common stock that investors may purchase and of the cash that can be distributed to us.

        Under the Illinois Insurance Code, no person may acquire control of SIRVA, and thus indirect control of Transguard, without the prior approval of the Illinois Director of Insurance. Under the Illinois Insurance Code, any person who acquires ownership of 10% or more of our outstanding shares of common stock would be presumed to have acquired such control, unless the Illinois Director of Insurance upon application determines otherwise. In addition, persons who do not acquire ownership of more than 10% of our outstanding shares of common stock may be deemed to have acquired such control if the Illinois Director of Insurance determines that such persons, directly or indirectly, exercise a controlling influence over the management or policies of Transguard. After completion of this offering, 70,084,748 shares of common stock are expected to be issued and outstanding.

        In addition, Transguard and our other insurance subsidiaries such as The Baxendale Insurance Company Ltd. are subject to extensive supervision and regulation by insurance regulators in their respective jurisdictions, including regulations limiting the payments of dividends from such insurance subsidiaries to their affiliates, including us.

Our share price may decline due to the large number of shares eligible for future sale.

        Sales of substantial amounts of common stock, or the possibility of such sales, may adversely affect the price of the common stock and impede our ability to raise capital through the issuance of equity securities.

        Upon consummation of this offering, there will be 70,084,748 shares of common stock outstanding. Of these shares, the shares of common stock sold in the offering will be freely transferable without restriction or further registration under the Securities Act of 1933. The remaining 49,032,116 shares of common stock outstanding, excluding shares sold by the selling stockholders in this offering, including the shares owned by Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership, will be restricted securities within the meaning of Rule 144 under the Securities Act, but will be eligible for resale subject to applicable volume, manner of sale, holding period and other limitations of Rule 144. We, Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership have agreed to a "lock-up", meaning that neither we nor they will sell any shares without the prior consent of Credit Suisse First Boston LLC and Goldman, Sachs & Co. for 180 days after the date of this prospectus. In addition, we have agreed to not waive the 180-day "lock-up" provisions contained in the Registration and Participation Agreement, dated as of March 30, 1998, among SIRVA, Clayton, Dubilier & Rice Fund V Limited Partnership and Exel plc, and the other parties thereto as amended. Following the expiration of this 180 day lock-up period, all of these 49,032,116 shares of our common stock will be eligible for future sale, subject to the applicable volume, manner of sale, holding period and other limitations of Rule 144. See "Shares Eligible for Future Sale" for a discussion of the shares of

21

common stock that may be sold into the public market in the future. In addition, stockholders currently representing all of the shares of our common stock have certain registration rights. See "Certain Relationships and Related Transactions — Registration and Participation Agreement" for a description of the Registration and Participation Agreement.

Purchasers of our common stock will experience immediate and substantial dilution resulting in their shares being worth less on a net tangible book value basis than the amount they invested.

        The initial public offering price is expected to be significantly higher than the net tangible book value per share of our common stock. Purchasers of the common stock in this offering will experience an immediate dilution in net tangible book value of $21.50 per share of common stock purchased. In the past, we issued options to acquire shares of common stock at prices that may be significantly below the initial public offering price. To the extent that these outstanding options are exercised, there may be further dilution to investors. Accordingly, in the event we are liquidated, investors may not receive the full amount of their investment. See "Dilution."

Our certificate of incorporation, by-laws and Delaware law may discourage takeovers and business combinations that our stockholders might consider in their best interests.

        Provisions in our certificate of incorporation and amended and restated by-laws may delay, defer, prevent or render more difficult a takeover attempt that our stockholders might consider in their best interests. These provisions include:

•

authorization of the issuance of preferred stock, the terms of which may be determined at the sole discretion of the Board of Directors;



•

establishment of a classified board of directors with staggered, three year terms;



•

provisions giving the board of directors sole power to set the number of directors;



•

limitation on the ability of stockholders to remove directors;



•

prohibition on stockholders from calling special meetings of stockholders;



•

establishment of advance notice requirements for stockholder proposals and nominations for election to the board of directors at stockholder meetings; and



•

requirement of the approval by the holders of at least 75% of our outstanding common stock for the amendment of our by-laws and provisions of our certificate of incorporation governing:



•

the classified board,



•

the liability of directors, and



•

the elimination of stockholder actions by written consent.

        These provisions may prevent our stockholders from receiving the benefit from any premium to the market price of our common stock offered by a bidder in a takeover context. Even in the absence of a takeover attempt, the existence of these provisions may adversely affect the prevailing market price of our common stock if they are viewed as discouraging takeover attempts in the future.

        Our certificate of incorporation and amended and restated by-laws may also make it difficult for stockholders to replace or remove our management. These provisions may facilitate management entrenchment that may delay, defer or prevent a change in our control, which may not be in the best interests of our stockholders.

        See "Description of Capital Stock" for additional information on the anti-takeover measures applicable to us.

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FORWARD-LOOKING STATEMENTS

        This prospectus contains "forward-looking statements." You should not place undue reliance on these statements. Forward-looking statements include information concerning our possible or assumed future results of operations, including descriptions of our business strategies. These statements often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," "seek," "will," "may" or similar expressions. These statements are based on certain assumptions that we have made in light of our experience in the industry as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate in these circumstances. As you read and consider this prospectus, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties and assumptions. Many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. Some important factors include:

•

our ability to continue to compete successfully,



•

changes in the market for our services,



•

general economic conditions being less favorable than expected, and global political conditions and the outbreak of war or hostilities or the occurrence of any terrorist attacks, including any nuclear, biological or chemical events,



•

our ability to grow our relocation services business,



•

risks associated with the real estate industry,



•

our reliance on, and our ability to attract, agents and owner/operators,



•

changes in the regulatory environment, including antitrust, environmental and insurance laws and regulations, that could negatively affect the operation of our business,



•

changes in Transguard's A.M. Best rating,



•

risks associated with operating in foreign countries,



•

loss of our key executive officers,



•

our ability to consummate and integrate potential acquisitions, and



•

the other factors included in "Risk Factors."

        In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this prospectus might not occur and you should not place undue reliance upon them. All forward-looking statements speak only as of the date of this prospectus. We undertake no obligation to update beyond that required by law any forward-looking statements, whether as a result of new information, future events or otherwise.

        All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements included in this prospectus.

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INTERNAL REORGANIZATION AND REFINANCING

Internal Reorganization

        In connection with this offering, we intend to effect an internal reorganization pursuant to which we would incorporate a new direct wholly-owned subsidiary, SIRVA Worldwide, Inc., which in turn would own directly all of the issued and outstanding capital stock of North American Van Lines. We may also effect transactions pursuant to which Allied Van Lines, Inc. and North American International Holding Corporation, which are currently direct wholly-owned subsidiaries of North American Van Lines, would become direct wholly-owned subsidiaries of SIRVA Worldwide, Inc.

Credit Agreement Refinancing

        In connection with this offering, we intend to effect a refinancing of the existing senior credit facility of our wholly-owned subsidiary, North American Van Lines, with a new senior credit facility. The commitments provided by the proposed lenders for the new senior credit facility provided for North American Van Lines and one or more of its foreign subsidiaries to be the borrowers under the facility. In connection with the planned internal reorganization, we are in discussions with the lenders to provide that SIRVA Worldwide, Inc. will be the primary borrower under the new senior credit facility, with one or more of its foreign subsidiaries to be additional borrowers. Upon consummation of this offering and the refinancing, although our total debt is expected to decrease by $165.3 million, we expect that the borrowers thereunder will have outstanding borrowings under the new senior credit facility of $459.7 million, representing an increase of $64.4 million from the amount outstanding on September 30, 2003. Of these borrowings, we expect that $425.0 million will be in the form of a term loan and $34.7 million will be drawn initially under the $175.0 million revolving portion of the new senior credit facility.

        JPMorgan Chase Bank, Bank of America, N.A., Credit Suisse First Boston, Deutsche Bank Trust Company Americas, Goldman Sachs Credit Partners L.P. and Citicorp North America, Inc., all of whom are affiliates of the underwriters, and certain of their affiliates, have committed to provide, or arrange for a syndicate of lenders to provide, the new senior credit facilities, subject to certain conditions, including but not limited to the consummation of this offering and the repurchase of the 13³/8% senior subordinated notes due 2009 tendered pursuant to the note repurchase described below. At the borrowers' election, the interest rates per annum applicable to the loans under the new senior credit facility are expected to be a fluctuating rate of interest measured by reference to either (1) an adjusted London inter-bank offered rate, or LIBOR, plus a borrowing margin or (2) an alternate base rate, or ABR, plus a borrowing margin. As a result of the refinancing, we expect to realize significantly lower interest expense. See "Use of Proceeds", "Capitalization" and "Description of Our Indebtedness."

Note Repurchase

        We have commenced a tender offer for all of North American Van Lines' 13³/8% senior subordinated notes due 2009. We will use the net proceeds from this offering and borrowings under the new senior credit facility to finance the note repurchase. In connection with the tender offer, North American Van Lines has received the requisite consents to remove substantially all of the restrictive covenants and certain other provisions from the indenture governing the senior subordinated notes pursuant to a supplemental indenture. Tenders of notes and consents that North American Van Lines received on or prior to October 31, 2003, may not be withdrawn or revoked except in limited circumstances. The tender offer is subject to conditions, including but not limited to the consummation of this offering, the completion of the credit agreement refinancing and the execution of a supplemental indenture following receipt of consents from holders of at least a majority in outstanding principal amount of the notes.

        The tender offer will remain open for a period after the consent date in order to maximize the number of notes tendered. To the extent that we purchase less than 100% of the senior subordinated notes under the tender offer, our initial borrowings under the revolving portion of the new senior credit facility, as well as the amount of anticipated savings on interest expense, may be less than currently anticipated. As of October 31, 2003, approximately 93% of the notes had been tendered.

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USE OF PROCEEDS

        We estimate that our net proceeds from the sale of 13,157,895 shares of common stock being offered by us hereby at an assumed initial public offering price of $19.00 per share, the midpoint of the range set forth on the cover page of this prospectus, after deducting estimated underwriting discounts and estimated offering expenses, will be approximately $232.4 million. We will not receive any proceeds from the sale of the 7,894,737 shares being offered by the selling stockholders, or the additional shares that would be sold by the selling stockholders if the underwriters exercised their over-allotment option.

        We intend to apply the net proceeds from this offering, together with the net proceeds from the borrowings under our new senior credit facility, in the following priority:

•

to repay in full the Tranche A senior term loan under our existing senior credit facility;



•

to repay in full the Tranche B senior term loan under our existing senior credit facility;



•

to repay in full the revolving credit facility under our existing senior credit facility;



•

to repurchase all of North American Van Lines' 13³/8% senior subordinated notes due 2009;



•

to repay in full SIRVA's senior discount loan;



•

to redeem all of SIRVA's outstanding shares of junior exchangeable preferred stock issued in connection with the purchase of the Allied and Pickfords businesses from Exel plc, formerly known as NFC plc; and



•

to repay the seller notes of North American Van Lines issued in connection with the purchase of CRS, the relocation services business of Cooperative Resource Services, Ltd.

        This offering is not conditioned upon the completion of the refinancing on the terms described in "Internal Reorganization and Refinancing" and "Description of our Indebtedness—Overview." We cannot assure you that the refinancing will be completed on the terms anticipated, or at all.

        The following table illustrates as of September 30, 2003, the estimated sources and uses of funds from this offering and our anticipated refinancing on the terms described in "Internal Reorganization and Refinancing."

Sources			Amount
			(in millions)
Common stock offered by us hereby			$	250.0
New senior term loan				425.0
New revolving credit facility borrowings				34.7
		Total sources	$	709.7
Uses
Repay Tranche A senior term loan			$	105.0
Repay Tranche B senior term loan				208.3
Repay existing revolving credit facility borrowings				82.0
Repurchase senior subordinated notes				150.0
Repay senior discount loan				63.5
Redeem junior exchangeable preferred stock				32.1
Repay seller notes				16.1
Estimated fees and expenses (1)				52.7
	Total uses		$	709.7

(1)

Estimated fees and expenses consist primarily of the tender premium to be paid to repurchase the senior subordinated notes, fees to be paid to the underwriters in connection with this offering and fees to be paid to the coordinators of our new senior credit facility.

25

        In connection with our acquisition of the Allied and Pickfords businesses on November 19, 1999, our subsidiary, North American Van Lines, entered into a senior credit agreement providing for a revolving credit facility of up to $150.0 million in revolving credit commitments, our Tranche A term loan, a seven-year term loan of $150.0 million, and our Tranche B term loan, an eight-year term loan of $175.0 million. In connection with the purchase of CRS, North American Van Lines borrowed an additional $50.0 million under the Tranche B term loan facility. The loans under the revolving credit facility mature on the seventh anniversary of the initial borrowing. The term loans and loans under the revolving credit facility bear interest at specified margins over a base rate or a eurodollar rate, depending on the interest rate option we elect. As of September 30, 2003, the interest on the Tranche A loan was 3.87%, the interest rate on the Tranche B loan was 5.12% and the interest on the $82.0 million then outstanding under the revolving credit facility was 3.92%.

        In connection with our acquisition of the Allied and Pickfords businesses on November 19, 1999, North American Van Lines issued $150.0 million aggregate principal amount of 13³/8% senior subordinated notes due 2009 pursuant to an indenture. The senior subordinated notes mature in 2009. They bear interest at a rate of 13³/8% per annum. See "Description of our Indebtedness."

        SIRVA's senior discount loan had an initial value of $35.0 million at November 19, 1999. The loan accretes at a rate of 16.0% per annum compounded semi-annually until December 1, 2004. Thereafter, the senior discount loan will bear interest at a rate of 16.0% per annum, payable semi-annually. As of September 30, 2003, our senior discount loan had accreted to $63.5 million. Such amount will be paid to the subsidiary of Clayton, Dubilier & Rice Fund VI Limited Partnership that purchased the senior discount loan on November 12, 2002. This subsidiary will in turn use these proceeds to repay a loan from an affiliate of Credit Suisse First Boston LLC, one of the underwriters of this offering.

        SIRVA's junior exchangeable preferred stock had an aggregate liquidation preference of $32.1 million as at September 30, 2003, which includes $7.6 million of accrued and unpaid dividends. It has a dividend rate of 12.4% compounded quarterly, although the payment of dividends is subject to the discretion of our Board of Directors.

        In connection with the purchase of CRS, the relocation services business of Cooperative Resource Services, Ltd., our subsidiary, North American Van Lines, issued two seller notes in the principal amounts of $10.0 million and $5.0 million, maturing on May 3, 2007, and May 3, 2013, respectively. The notes have an interest rate of 10.0% per annum payable quarterly in arrears. 50.0% of the interest rate is payable in kind and the remaining 50.0% is payable in cash. As of September 30, 2003, the notes had a principal amount of $10.7 million and $5.4 million, respectively.

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DIVIDEND POLICY

        We have not paid, and do not expect for the foreseeable future to pay dividends on our common stock. Instead, we anticipate that all of our earnings in the foreseeable future will be used for the operation and growth of our business. The payment of dividends by us to holders of our common stock will be limited by our new senior credit agreement, which will restrict our operating subsidiaries' ability to pay dividends to SIRVA. Any future determination to pay dividends on our common stock is subject to the discretion of our Board of Directors and will depend upon various factors, including our results of operations, financial condition, liquidity requirements, restrictions imposed by applicable law and our contracts, and other factors deemed relevant by our Board of Directors.

27

CAPITALIZATION

        The following table sets forth as of September 30, 2003 on a consolidated basis:

•

our actual capitalization; and



•

our pro forma capitalization that gives effect to our sale of 13,157,895 shares of common stock in this offering at an assumed initial public offering price of $19.00 per share, the midpoint of the range set forth on the cover page of this prospectus, after deducting underwriters' discounts and estimated offerings expenses, the refinancing of our senior credit facility and the application of the net proceeds therefrom to repay a portion of our outstanding debt, repurchase all of North American Van Lines' senior subordinated notes and redeem all of our outstanding junior exchangeable preferred stock, on the terms described in "Internal Reorganization and Refinancing" and "Use of Proceeds."

        This table should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Description of Certain Indebtedness" and our consolidated financial statements and related notes thereto included elsewhere in this prospectus.

		As of September 30, 2003
		Actual			Pro Forma
		(in thousands)
Cash (1)		$	60,719		$	60,719
Short-Term Debt
	Current Portion of Long-Term Debt and Capital Leases		26,996			4,882
	Foreign Lines of Credit		2,614			2,614
	Relocation Financing Facilities (2)		37,657			37,657
	Mortgage Warehouse Facility (3)		63,242			63,242
Long-Term Debt
	Revolving Credit Facility (4)		82,000			34,661
	Term Loans		291,188			425,000
	Senior Subordinated Notes (5)		150,000			—
	Senior Discount Loan		63,503			—
	Other Debt		35,260			19,138
Total long-term debt			621,951			478,799
Redeemable junior preferred obligation			32,046			—
Total long-term debt and redeemable junior preferred obligation			653,997			478,799
Redeemable common stock (6)			11,528			—
Equity:
	Common stock, $.01 par value (6)(7)		553			706
	Additional paid-in capital (7)		196,740			440,490
	Common stock purchase warrant		655			655
	Accumulated other comprehensive loss (8)		(28,204	)		(25,916	)
	Accumulated deficit (9)		(8,710	)		(37,670	)
Total paid-in capital and accumulated deficit			161,034			378,265
	Less treasury stock		(2,248	)		(2,248	)
Total equity			158,786			376,017
Total capitalization		$	954,820		$	963,211

(1)

Includes $31,684 of cash held at our wholly owned insurance subsidiaries that requires regulatory agency approval prior to being used for non-insurance related purposes.

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(2)

As part of our relocation product offering, we provide home equity advances to relocating corporate employees and sometimes purchase the employees' homes under buy-out programs. In the U.K. and for traditional relocations in the U.S., the corporate customer guarantees us repayment of these amounts to the extent proceeds from the sale of the home are insufficient. These advances and purchased homes are classified as current assets on our balance sheet. In the U.K., these equity advances and home purchases are financed through our Relocation Financing Facilities. Because of the guarantees by our corporate customers of these advances, we believe the risk of loss is very low. For internal purposes, we treat these items as a current liability, not as debt.

(3)

We provide mortgage services to our clients, underwriting the mortgage for a transferee's home purchase. Before a mortgage is underwritten, we obtain the agreement of one of various third-party financial institutions to purchase the mortgage from us. There is a processing lag of 20-30 days between the time we write mortgages and the time we complete the sale. During this time, the mortgages are carried as current assets and financed through our mortgage warehouse facility. Because of the credit quality of our counterparties, we believe that there is very little risk associated with the mortgage facility and for internal purposes we treat it as a current liability, not as debt.

(4)

Relocation activity, and thus our business, is highly seasonal, with significantly more relocations in the second and third quarters than during the rest of the year. Our need for working capital financing is subject to these seasonal trends.

(5)

Assumes repurchase of all of North American Van Lines' 13³/8% senior subordinated notes due 2009.

(6)

At September 30, 2003, there were 56,926,853 shares of common stock outstanding, and 194 holders of our common stock.

(7)

After consummation of the offering, the 2,093,662 shares of common stock shown as redeemable common stock at September 30, 2003 will no longer be redeemable, and are therefore treated as equity on a pro forma basis.

(8)

Pro forma accumulated other comprehensive loss assumes the write off of $3,520,000 ($2,288,000 net of tax) of unrecognized hedging losses associated with open interest rate swap agreements linked to our existing senior credit facility.

(9)

Pro forma accumulated deficit assumes the following one-time charges associated with this offering and the refinancing of our senior credit facility (dollars in thousands):

Tender premium on $150,000 senior subordinated notes	$	27,000
Write off of deferred debt issuance costs on existing senior credit facility		13,592
Write off of unrecognized hedging losses associated with open interest rate swap agreements		3,520
		44,112
Income taxes		(15,152	)
Pro forma adjustment to accumulated deficit	$	28,960

29

DILUTION

        If you invest in our common stock, your interest will be diluted to the extent of the difference between the initial public offering price per share of our common stock and the net tangible book value per share of our common stock after this offering.

        Net tangible book value per share represents the amount of total tangible assets less total liabilities, divided by the number of shares of common stock then outstanding. Our net tangible book value as of September 30, 2003 was $(407.7) million, or $(7.16) per share of common stock based on the 56,926,853 shares outstanding as of such date. After giving effect to our sale of shares of common stock in this offering at an assumed initial public offering price of $19.00 per share, the midpoint of the range set forth on the cover page of this prospectus, and after deducting estimated underwriting discounts and estimated offering expenses, our net tangible book value as of September 30, 2003 would have been $(175.3) million, or $(2.50) per share of common stock. This represents an immediate increase in the net tangible book value of $4.66 per share to existing stockholders and an immediate and substantial dilution of $21.50 per share to new investors purchasing common stock in this offering. The following table illustrates this per share dilution:

Assumed initial public offering price per share		$	19.00
	Net tangible book value per share as of September 30, 2003	$	(7.16	)
	Increase per share attributable to this offering		4.66
Net tangible book value per share after this offering			(2.50	)
Dilution in net tangible book value per share to new investors		$	21.50

        The following table summarizes as of September 30, 2003 the total number of shares of common stock acquired from us, the total consideration paid to us, and the weighted average price per share paid by existing stockholders and by new investors purchasing shares of common stock from us in this offering at our assumed initial public offering price of $19.00 per share, the midpoint of the range set forth on the cover page of this prospectus and before deducting underwriting discounts and estimated offering expenses payable by us.

		Shares Acquired			Total Consideration
									Weighted Average Price Per Share
		Number	Percent		Amount		Percent
Existing stockholders		56,926,853	81.2	%	$	228,426,676	47.7	%	$	4.01
New investors		13,157,895	18.8			250,000,005	52.3			19.00
	Total	70,084,748	100.0	%	$	478,426,681	100.0	%	$	6.83

        The foregoing discussion and tables assume no exercise of outstanding stock options. As of September 30, 2003, there were options outstanding to purchase a total of 4,560,072 shares of our common stock at a weighted average exercise price of $4.66 per share and the outstanding warrant issued to an affiliate of Exel plc to purchase 2,773,116 shares of common stock at an exercise price of $12.62 per share.

        To the extent that any of these stock options are exercised, there may be further dilution to new investors. See "Capitalization," "Management" and note 16 to our consolidated financial statements included elsewhere in this prospectus.

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SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA

        The following table presents our selected consolidated financial and other data as of and for the periods indicated. You should read the following financial information in conjunction with "Capitalization," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the notes to those consolidated financial statements appearing elsewhere in this prospectus. Share and per share information set forth below have been adjusted to reflect the split of each share of our common stock into 3.17 shares of common stock by way of reclassification that was approved by our Board of Directors on November 7, 2003 and that will become effective prior to the consummation of this offering.

        We derived our selected consolidated balance sheet data as of December 31, 2001 and 2002 and our selected consolidated statement of operations data for each of the years in the three-year period ended December 31, 2002 from our audited consolidated financial statements included elsewhere in this prospectus. Selected consolidated balance sheet and statement of operations data as of and for the nine-month period ended December 26, 1998, as of and for the year ended December 25, 1999 and balance sheet data as of December 31, 2000, have been derived from our audited consolidated financial statements which are not included in this prospectus. Our selected consolidated balance sheet and statement of operations data as of and for the nine months ended September 30, 2003 and 2002, respectively, are derived from our unaudited condensed consolidated financial statements included elsewhere in this prospectus. The unaudited condensed consolidated financial statements reflect all adjustments, including usual recurring adjustments, which in the opinion of management, are necessary for the fair presentation of that information as of and for the periods presented. Our results for the interim periods are not necessarily indicative of the results that you should expect for the full year or in the future.

		Nine Month Period from March 29, 1998 (inception) through December 26, 1998(2)
																	(Unaudited) Nine Months Ended September 30,
								Years Ended December 31,
					Year Ended December 25, 1999(1)(2)(3)
								2000(3)			2001(3)			2002			2002			2003
		(Dollars in millions except percentage, share and per share data)
Statement of Operations Data:
Operating revenues(1)
	Relocation Solutions – North America	$	656.1		$	933.3		$	1,791.8		$	1,652.1		$	1,544.4		$	1,173.1		$	1,240.4
Relocation Solutions – Europe & Asia Pacific			40.0			99.9			372.8			387.1			408.0			300.1			350.9
Global Relocation Solutions			696.1			1,033.2		$	2,164.6		$	2,039.2		$	1,952.4		$	1,473.2		$	1,591.3
Network Services			—			8.8			75.8			84.2			125.0			89.9			117.9
Transportation Solutions			63.1			117.8			138.3			125.9			108.2			82.5			76.0
		$	759.2		$	1,159.8		$	2,378.7		$	2,249.3		$	2,185.6		$	1,645.6		$	1,785.2
Purchased Transportation Expense(1)		$	486.2		$	732.6		$	1,559.8		$	1,438.8		$	1,303.2		$	990.6		$	1,002.1
Other direct expense			152.9			223.8			433.8			426.4			463.9			343.5			429.9
Gross margin		$	120.1		$	203.4		$	385.1		$	384.1		$	418.5		$	311.5		$	353.2
Income from operations(4)
Relocation Solutions – North America			10.7			(10.5	)		8.1			15.1			41.0			35.2			44.9
Relocation Solutions – Europe & Asia Pacific			1.9			2.7			23.7			26.0			24.8			17.2			23.8
Global Relocation Solutions		$	12.6		$	(7.8	)	$	31.8		$	41.1		$	65.8		$	52.4		$	68.7
Network Services			—			3.8			17.4			18.5			26.5			17.9			26.1
Transportation Solutions			(1.0	)		2.9			0.3			(6.3	)		3.3			3.8			1.8
Corporate			—			—			(0.1	)		(0.8	)		(1.3	)		(1.0	)		(3.7	)
		$	11.6		$	(1.1	)	$	49.4		$	52.5		$	94.3		$	73.1		$	92.9
Income (loss) before cumulative effect of accounting change(4)(5)		$	(1.2	)	$	(20.5	)	$	(21.9	)	$	(16.6	)	$	20.8		$	17.0		$	30.9
Cumulative effect of accounting change, net of tax(6)			—			—			—			(0.3	)		—			—			—
Net income (loss)(4)(7)		$	(1.2	)	$	(20.5	)	$	(21.9	)	$	(16.9	)	$	20.8		$	17.0		$	30.9

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Per Share Data (4):
Income (loss) per share before cumulative effect of accounting change – basic (7)		$	(0.06	)	$	(0.89	)	$	(0.68	)	$	(0.47	)	$	0.33		$	0.29		$	0.51
Income (loss) per share before cumulative effect of accounting change – diluted (7)		$	(0.06	)	$	(0.89	)	$	(0.68	)	$	(0.47	)	$	0.33		$	0.28		$	0.48
Net income (loss) per share – basic (7)(8)		$	(0.06	)	$	(0.89	)	$	(0.68	)	$	(0.48	)	$	0.33		$	0.29		$	0.51
Net income (loss) per share – diluted (7)(8)		$	(0.06	)	$	(0.89	)	$	(0.68	)	$	(0.48	)	$	0.33		$	0.28		$	0.48
Weighted average common shares outstanding:
	Basic		20,975,357			23,285,669			39,065,685			42,308,361			51,712,625			50,182,133			56,670,610
	Diluted		20,975,357			23,285,669			39,065,685			42,308,361			51,832,236			50,299,401			59,200,118
Balance Sheet Data:
Cash and cash equivalents		$	2.1		$	25.2		$	43.5		$	32.1		$	45.5		$	46.9		$	60.7
Property and equipment, net			73.6			165.9			158.7			165.4			171.3			176.5			173.8
Total assets			385.3			1,152.5			1,199.6			1,074.0			1,357.5			1,427.2			1,583.7
Short term debt (9)			28.6			78.3			99.1			68.2			99.7			104.3			130.5
Long term debt (10)			140.0			511.5			504.8			505.0			571.8			593.9			622.0
Redeemable junior preferred obligation (12)						—			—			—			—			—			32.1
Redeemable common stock (11)			—			7.0			6.1			3.3			7.4			4.3			11.5
Redeemable junior preferred stock (12)			—			24.6			26.4			28.3			30.4			29.9			—
Stockholder's equity			56.9			99.8			94.0			61.9			128.3			140.6			158.8
Other Data:
EBITDA (4)(13)		$	34.2		$	26.2		$	103.6		$	100.9		$	137.8		$	103.7		$	128.0
Depreciation and amortization (14)			22.5			31.2			53.9			48.7			44.2			30.9			35.0
Gross margin as a percentage of operating revenues			15.8	%		17.5	%		16.2	%		17.1	%		19.1	%		18.9	%		19.8	%

(1)

Our operating revenues represent amounts billed to our customers for all aspects of the services that we provide. Where we fulfill the transportation service element using our independent agent network or other third party service providers, we incur purchased transportation expense, or PTE, which is included in the amount billed to our customer. The level of PTE generally increases or decreases in proportion to the operating revenues generated from our transportation services.

(2)

Effective for fiscal year 2000, we changed our year end to December 31. Prior to fiscal year 2000, the fiscal year ended on the Saturday nearest to December 31 each year.

(3)

Includes financial data of the Allied and Pickfords businesses from November 19, 1999. On November 19, 1999, we completed the acquisition of the Allied and Pickfords businesses, which was accounted for as a purchase. The acquisition resulted in an adjustment to goodwill. See note 2 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus.

(4)

For the nine months ended September 30, 2003, we recognized $3.0 million of non-cash equity-based compensation expense in relation to stock subscriptions and stock option grants made to certain managers and directors in June and August 2003. The expense has been recorded as the difference between the subscription or exercise price and the deemed fair value of our common and redeemable common stock on the date of grant in accordance with APB 25. The total non-cash equity-based compensation expense to be recognized by us in respect of these transactions is $6.7 million. We expect to recognize $0.5 million in the fourth quarter of 2003 and $1.5 million, $0.8 million, $0.5 million, $0.3 million and $0.1 million in each of 2004, 2005, 2006, 2007 and 2008 respectively.

(5)

During 1999, we retired debt resulting in an extraordinary charge of $3.4 million, net of applicable income tax benefit. Following our adoption of Statement of Financial Accounting Standards ("SFAS") No. 145, "Rescission Of FASB Statements No. 4, 44, and 64, Amendment Of FASB Statement No. 13, And Technical Corrections" ("SFAS 145") on January 1, 2003, this extraordinary charge has been included as part of "Non-operating income (expense) and minority interest" in the determination of "Income/(loss) before cumulative

32

effect of accounting change" in the above selected financial data table, rather than a separate extraordinary item.

(6)

Effective January 1, 2001 we adopted SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133") as amended, which resulted in a change in method of accounting. The cumulative effect of this accounting change was a loss of $0.5 million ($0.3 million, net of tax), or $0.01 per share, both on a basic and diluted basis. In 2001, basic and diluted loss per share before cumulative effect of accounting change was $0.47. See note 1(r) to the Notes to Consolidated Financial Statements included elsewhere in this prospectus.

(7)

Earnings (loss) per share and weighted average common shares outstanding give effect to the split of each share of our common stock by way of reclassification into 3.17 shares of common stock that will become effective prior to consummation of this offering.

(8)

We adopted SFAS No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142") with effect from January 1, 2002. In accordance with SFAS 142, we no longer amortize goodwill and indefinite-lived intangibles, but rather will test such assets at least annually for impairment. We have completed the first step of the impairment test under the transitional requirements of SFAS 142 and no impairment of goodwill or indefinite-lived intangibles was indicated. A reconciliation of previously reported net income and earnings per share to the amounts adjusted for the exclusion of goodwill and indefinite-lived intangibles amortization is presented below. Earnings per ordinary share adjusted for goodwill charges is calculated by adding back the goodwill and indefinite-lived intangibles charges to net income and dividing by the weighted average ordinary shares outstanding for all periods presented.

		Nine Months Ended December 26,			Year Ended December 25,			Years Ended December 31,
		1998			1999			2000			2001			2002
		(Dollars in millions except per share amounts)
Net income (loss), as reported		$	(1.2	)	$	(20.5	)	$	(21.9	)	$	(16.9	)	$	20.8
	Amortization of goodwill and trademarks		1.8			3.1			11.0			10.9			—
	Income tax provision		(0.7	)		(0.9	)		(1.0	)		(1.0	)		—
Adjusted net income (loss)		$	(0.1	)	$	(18.3	)	$	(11.9	)	$	(7.0	)	$	20.8
Basic net income (loss) per share, as reported		$	(0.06	)	$	(0.89	)	$	(0.68	)	$	(0.48	)	$	0.33
Amortization of goodwill and trademarks			0.09			0.14			0.28			0.25			—
Income tax provision			(0.03	)		(0.04	)		(0.02	)		(0.02	)		—
Adjusted basic net income (loss) per share		$	—		$	(0.79	)	$	(0.42	)	$	(0.25	)	$	0.33
Diluted net income (loss) per share, as reported		$	(0.06	)		(0.89	)	$	(0.68	)	$	(0.48	)	$	0.33
Amortization of goodwill and trademarks			0.09			0.14			0.28			0.25			—
Income tax provision			(0.03	)		(0.04	)		(0.02	)		(0.02	)		—
Adjusted diluted net income (loss) per share		$	—		$	(0.79	)	$	(0.42	)	$	(0.25	)	$	0.33

(9)

Short term debt consists of the current portion of long-term debt, amounts outstanding under our mortgage warehouse credit facility and our relocation financing facility, and other short-term debt.

(10)

Long term debt consists of (i) long-term debt excluding the current portion of long-term debt, (ii) capital lease obligations and (iii) amounts outstanding under the revolving credit facility forming part of our senior credit facility.

(11)

Certain of our key employees can require us to repurchase all of the shares and the exercisable portion of options held upon death, disability, retirement at normal age or termination without "Cause" (as defined in the

33

SIRVA, Inc. Stock Incentive Plan). Such securities are classified as "Redeemable Shares of Common Stock" within mezzanine equity. This repurchase right will terminate upon the consummation of the offering.

(12)

In connection with the acquisition of the Allied and Pickfords businesses, we issued 24,500 shares of junior preferred stock, due in 2010, to an affiliate of Exel plc. The dividend rate on this junior preferred stock, which will be redeemed with the proceeds of the offering, is 12.4% compounded quarterly and is cumulative. Effective July 1, 2003, we adopted SFAS No. 150, "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity", which resulted in a reclassification of our redeemable junior preferred stock from mezzanine equity to a liability. See note 1 to the Notes to Condensed Consolidated Financial Statements included elsewhere in this prospectus.

(13)

EBITDA is defined as net income (loss) before interest, taxes, depreciation and amortization.

        EBITDA is calculated as follows:

															Nine Months Ended September 30,
	Nine months ended December 26, 1998						Years Ended December 31,
				Year Ended December 25, 1999
							2000			2001			2002		2002		2003
	(Dollars in millions)
Net income (loss)	$	(1.2	)	$	(20.5	)	$	(21.9	)	$	(16.9	)	$	20.8	$	17.0	$	30.9
Interest expense		11.8			22.1			73.4			69.2			61.2		44.9		45.9
Provision (benefit) for income taxes		1.1			(6.6	)		(1.8	)		(0.1	)		11.6		10.9		16.2
Depreciation		18.8			25.6			38.0			33.5			35.9		25.9		27.7
Amortization		3.7			5.6			15.9			15.2			8.3		5.0		7.3
EBITDA	$	34.2		$	26.2		$	103.6		$	100.9		$	137.8	$	103.7	$	128.0

We believe that EBITDA is a relevant measurement for assessing performance since it attempts to eliminate variances caused by the effects of differences in taxation, the amount and types of capital employed and depreciation and amortization policies. EBITDA is not a measure determined in accordance with generally accepted accounting principles and should not be considered by investors as an alternative to income from operations or net income as an indicator of our performance. The EBITDA disclosed here is not necessarily comparable to EBITDA disclosed by other companies because EBITDA is not uniformly defined.

For the nine months ended September 30, 2003, we recognized $3.0 million of non-cash equity-based compensation expense. See note 4 above.

(14)

Includes depreciation expense for property and equipment and amortization expense for intangible assets and deferred agent contract expenditures. Excludes amortization expense for deferred debt issuance costs, which are recorded as part of interest expense.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following is a discussion and analysis of our financial condition and results of operations for the fiscal years ended December 31, 2000, 2001 and 2002, and for the nine month periods ended September 30, 2002 and 2003. You should read this discussion and analysis together with our consolidated financial statements and notes to those consolidated financial statements included elsewhere in this prospectus. This discussion may contain forward-looking statements and involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, such as those set forth under "Risk Factors" and elsewhere in this prospectus.

Overview

        We are a world leader in the global relocation industry, providing our solutions to a well-established and diverse customer base. We handle more than 385,000 relocations per year including transferring corporate and government employees and moving individual consumers. We operate in 43 countries under well-recognized brand names including Allied®, northAmerican®, Global® and SIRVA Relocation in North America, Pickfords® in the U.K., Maison Huet® in France, Scanvan® in Scandinavia and Allied Pickfords in the Asia Pacific region. We are redefining the global relocation market by combining our relocation service offerings with our proprietary moving services network on a global basis. This unique combination is driving our growth by addressing our corporate and government customers' needs for a comprehensive service offering with global reach from a single supplier. In addition, we offer a variety of services targeted at meeting the needs of truck drivers, fleet owners and agents, both inside and outside our proprietary agent network.

Our Historical Development

        In 1998, Clayton, Dubilier & Rice Fund V Limited Partnership organized us to acquire North American Van Lines, Inc., one of the largest U.S. moving services companies by number of shipments and a significant provider of specialty transportation services, from Norfolk Southern Corporation. In 1999, we acquired the Allied and Pickfords businesses from NFC plc, now known as Exel plc. The integration of these two businesses drove substantial operating synergies as a result of back-office rationalization, significant scale economies and an expanded international service offering. The acquisitions of Allied and Pickfords also brought us additional specialty transportation businesses and Transguard, a leading provider of insurance services to moving agents, fleet owners and owner/operator drivers. We have since completed a number of acquisitions to fill out our global moving footprint. In June of 2002, we acquired Maison Huet, solidifying our market position in France. In June 2003, we acquired Scanvan, a leading moving services company in Scandinavia that employs an asset-light network-manager model very similar to our U.S. moving services business. The integration of these market-leading businesses into a single company has created a proprietary moving services fulfillment network with unmatched global reach and capabilities.

        In the late 1990s, we recognized an increasing trend for corporate customers to outsource all aspects of an employee relocation, including household goods relocation, to relocation service providers. We viewed this trend as an opportunity to offer our customers higher value services, deepen our customer relationships and move into a complementary and growing market. Consequently, we began a thorough review of the industry for an acquisition candidate that would both meet our requirements for innovative, high-quality services and make us a leader in providing comprehensive relocation services to corporate customers.

        As a result of this effort, we acquired the relocation services business of Cooperative Resource Services, Ltd., or CRS, in 2002. CRS was a leading independent provider of outsourced relocation services with an innovative and differentiated fixed-fee product offering. Later that year, we acquired Rowan Simmons, a leading independent provider of outsourced relocation services in the United Kingdom. With the 2003 opening of our office in Hong Kong, we now have a global relocation services capability that, when combined with our worldwide moving services network, is unique in the industry.

35

        The following table summarizes the key acquisitions in our corporate development to date:

Acquisition	Date	Operating Revenues for Last Full Fiscal Year Prior to Acquisition		Strategic Rationale
		(Dollars in millions)
North American Van Lines	March 1998	$	941.5	Initial entry into moving services
Allied and Pickfords	November 1999	$	1,173.6	Expand presence in North American and international moving markets
VCW and National Association of Independent Truckers	April 2002	$	11.1	Expand Network Services sales channel and augment service portfolio
Cooperative Resource Services	May 2002	$	84.1	Strategic entry into North American Relocation Services marketplace
Maison Huet	June 2002	$	6.6	Expand Moving Services capabilities in France
Rowan Simmons	August 2002	$	12.4	Strategic entry into U.K. Relocation Services marketplace
Scanvan	June 2003	$	50.0	Expand Moving Services and Relocation Services to Scandinavia

Operating Segments

        Our business operates in four segments: Relocation Solutions-North America, Relocation Solutions-Europe & Asia Pacific, Network Services and Transportation Solutions. We sometimes refer to our Relocation Solutions-North America and Relocation Solutions-Europe & Asia Pacific segments together as Global Relocation Solutions.

        Global Relocation Solutions.    We offer a comprehensive suite of relocation solutions to our more than 2,500 corporate and government customers around the world. We offer a wide variety of employee relocation services including the sale of employees' homes, movement of their household goods, purchase of their new homes and provision of destination services. In addition, we provide our corporate customers with moving services for products that require special handling and constant monitoring due to their high value. Our relocation solutions services are provided by a team of over 6,000 employees around the world and a network of agents and other service providers.

Relocation Solutions-North America provides our moving services through our proprietary branded network of 780 agents who own the trucks and trailers used in moves and are responsible for packing, hauling and storage and distribution of household goods. We act as a network manager for our agents, providing, among other things, brand management, load optimization, billing, collection and claims handling. Historically, our operating revenues for this segment have been derived predominantly from our moving services business.

Relocation Solutions-Europe & Asia Pacific provides moving services through a network of company-owned and agent-owned locations in the U.K., Continental Europe and the Asia Pacific region. To date, our operating revenues for this segment have been derived predominantly from our moving services business.

        Network Services offers a variety of services for truck drivers, fleet owners and agents, both inside and outside our network. Services offered include insurance coverage such as vehicle liability, occupational accident, physical damage and inland marine insurance coverage, as well as truck maintenance and repair services and group purchasing. In addition, we offer a suite of services including fuel, cell phone, tire services, legal assistance and

36

retirement programs to the members of our National Association of Independent Truckers, an association of independent contract truck drivers. This association currently has approximately 24,800 owner/operator members.

Transportation Solutions provides inventory management solutions, using proprietary asset management technology, to coordinate a variety of services such as order fulfillment, project specific delivery management and the tracing of products through a customer's supply chains.

Critical Accounting Policies

        Our accounting policies are described in Note 1 to our consolidated financial statements included elsewhere in this prospectus. The preparation of financial statements requires management to make estimates and assumptions in certain circumstances that affect amounts reported in the accompanying consolidated financial statements and related footnotes. In preparing these financial statements, management has made its best estimates and judgments of certain amounts included in the financial statements, giving due consideration to materiality. Application of these accounting policies involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates.

        Revenue recognition.    For our moving services, we recognize estimated gross operating revenues to be invoiced to the transportation customer and all related transportation expenses on the date a shipment is delivered or services are completed. Calculations by shipment are based upon estimated weights resulting from a survey of the home and the known distances between origin and destination. The estimate of revenue remains in a receivable account called Delivered Not Processed, or DNP, until the customer is invoiced. Concurrent with the DNP estimate, we recognize an accrual for purchased transportation expenses, or PTE, to account for the estimated costs of packing services, transportation expenses and other such costs associated with the service delivery. The estimate for PTE is not adjusted until we determine actual charges in accordance with agent compensation guidelines, or until we are invoiced for actual charges, which is typically within 30 days of the estimate.

        For our real estate related relocation services, fees are paid to us by corporate customers at either a fixed price per transferred employee or based upon a fixed percentage of the home's selling price. In either case, revenue is recognized when a home sale contract with the ultimate buyer is signed. If we purchase a property from the transferee when no outside buyer has been located, revenue is not recognized on that property until the closing of a sale to an outside buyer. Additionally, fees are paid to us by company-qualified real estate agents for the home-sale listing or home purchase referral of a transferred employee and are recognized as revenue when a home sale contract with the buyer is signed.

        Insurance reserves.    We have first dollar insurance coverage, subject to specified deductibles, for principally all insurable business risks except cargo damage claims, delay claims and claims in our insurance business. Our multiple-line property and commercial liability insurance group sets its reserve rates based on a percentage of earned premium. The percentage is based on historical data, run rates and actuarial methods. At December 31, 2002 and September 30, 2003, our insurance reserves totaled $48.7 million and $53.8 million respectively, however actual results may be materially different from our current estimates.

        Claims reserves.    We estimate costs relating to cargo damage based principally on actuarial methods applied to historical trends. Both the frequency of claims and the severity of claims influence claim costs. Claim frequency, measured by the ratio of claims to shipments, generally falls within a relatively small range and is influenced by the volume of shipments and the type of product being transported. Claim severity, measured as the average cost per claim, is influenced by the type of product transported as well as by the coverage level chosen by the customer. These historical metrics are used to record a provision in the current period for the cost to settle claims that have been incurred, but will be settled in future periods. The customer generally files a claim for damage shortly after the service is completed, but the settlement process can extend from a period of a few months to several years. As a result of the length of the settlement cycle, it is necessary to utilize frequency and severity trends to estimate current period claims expenses that are derived from prior years, as these years contain more fully developed claims experience. An analysis is performed each quarter comparing open and closed claim costs, as well as estimates for

37

incurred but not reported claim costs, to the original estimates, and changes to those estimates are recorded as appropriate. Cargo claims expense was $43.1 million, $39.2 million and $26.1 million for the years ended December 31, 2000, 2001 and 2002, respectively and $21.6 million and $25.9 million for the nine months ended September 30, 2002 and 2003, respectively. Claim frequency and severity improved in 2001 and 2002 as compared to historical trends. The frequency improvement was due primarily to lower shipment volumes and quality control initiatives. As the volume of shipments declined, the need to pack and load household goods shipments on one truck and then transfer the shipment to another truck for the movement and ultimate delivery to destination, a practice necessary in the peak summer season when hauling is near full capacity, also declined. In addition, lower specialized transportation volumes resulted in less congested warehouse facilities, a condition that can negatively affect product handling. With the freight being handled fewer times, the opportunity for damage is reduced and claim frequency generally declines. We also implemented quality control initiatives including driver training and modified packing procedures that contributed to the lower level of claims. The shipment volume declines and quality control initiatives were considered as part of the cargo claims estimates, however our actual experience was better than management's original estimates. At December 31, 2002 and September 30, 2003, our claims reserves totaled $27.2 million and $25.8 million respectively, however actual results may be materially different from our current estimates.

        Allowance for doubtful accounts.    An allowance for doubtful accounts and notes receivable is maintained for estimated losses resulting from the inability of our customers or agents to make required payments. If the financial condition of our customers and agents were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. Our allowances for doubtful accounts and notes receivable as of December 31, 2002 and September 30, 2003, amounted to $25.1 million and $23.6 million, and represented 7.5% and 5.3% of our accounts receivable balances respectively. Actual results may be materially different from our current estimates.

        Goodwill and intangible assets.    We amortized goodwill and other intangible assets over their useful lives prior to the adoption of Statement of Financial Accounting Standards ("SFAS") No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142") on January 1, 2002. Useful lives were based on management's estimates of the periods that the assets will generate operating revenues. Following our adoption of SFAS 142, we no longer amortize goodwill and intangible assets having indefinite useful lives; however, we were required to perform an initial impairment review in 2002, which did not result in an impairment charge. This standard also requires that an annual impairment review be performed, which requires us to place a fair value on the individual reporting units of our business. This required us to select an appropriate method of valuation for our business using discounted estimated cash flows and to assess assumptions inherent in such a method on an annual basis. In addition, whenever events or changes in circumstances indicate that the carrying value of goodwill and other intangible assets might not be recoverable, we will perform an impairment review.

        The judgments we make in determining whether our goodwill and other intangible assets are impaired will directly affect our reported operating income, since any time we determine that any of these assets are impaired, we will be required to recognize a charge in our statement of operations for the relevant period equal to the decline in value of such assets. Our goodwill and other intangible assets totaled $559.3 million at December 31, 2002 and $577.5 million at September 30, 2003, which in each case included $408.7 million related to the original purchase of NAVL and the Allied and Pickfords businesses.

        Intangible assets with finite lives are amortized over their useful lives using a straight-line amortization method for all time periods presented. For customer and member relationships, those lives range from 5 to 18 years and for covenants not to compete, lives range from 3 to 5 years. Commencing October 1, 2003, we will amortize intangible assets with finite lives over their remaining useful lives using an accelerated amortization method to more closely reflect the pattern in which economic benefits of the intangible assets are utilized.

        Pensions and other postretirement benefits.    We provide a range of benefits to our current and retired employees, including defined benefit retirement plans, postretirement health care and life insurance benefits and postemployment benefits (primarily severance). We record annual amounts relating to these plans based on

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calculations specified by generally accepted accounting principles (GAAP), which include various actuarial assumptions, such as discount rates, assumed rates of return, compensation increases, turnover rates and health care cost trend rates. We review our actuarial assumptions on an annual basis and make modifications to the assumptions based on current rates and trends when it is deemed appropriate to do so. As required by GAAP, the effect of the modifications is generally recorded or amortized over future periods. We believe that the assumptions utilized in recording our obligations under our plans are reasonable based on our experience and advice from our actuaries.

        Impairment of long-lived assets.    We periodically assess impairments of our long-lived assets in accordance with the provisions of SFAS No. 144, "Accounting for the Impairment or Disposal of Long-lived Assets" ("SFAS 144"). An impairment review is performed whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors considered by us include, but are not limited to, significant underperformance relative to expected historical or projected future operating results; significant changes in the manner of use of the acquired assets or the strategy for our overall business; and significant negative industry or economic trends. When we determine that the carrying value of a long-lived asset may not be recoverable based upon the existence of one or more of the above impairment indicators, we estimate the future undiscounted cash flows expected to result from the use of the asset and its eventual disposition. If the sum of these expected future undiscounted cash flows and eventual disposition is less than the carrying amount of the asset, we calculate an impairment loss. An impairment loss is equal to the difference between the fair value of the asset and its carrying value. Fair value is generally determined using a discounted cash flow methodology.

        As discussed in our consolidated financial statements, certain software modules were reviewed for impairment in connection with a change in business strategy within transportation solutions at the end of 2002. As a result of this exercise, we recorded asset impairment charges of $7.1 million for the year ended December 31, 2002.

        Commitments and contingencies.    We evaluate contingent liabilities including threatened or pending litigation in accordance with SFAS No. 5, "Accounting for Contingencies" ("SFAS 5"), and record accruals when the outcome of these matters is deemed probable and the liability is reasonably estimable. We make these assessments based on the facts and circumstances and in some instances based in part on the advice of outside counsel.

        Income taxes.    We follow SFAS No. 109, "Accounting for Income Taxes" ("SFAS 109"). Under the asset and liability method of SFAS 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax laws and tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities due to a change in tax rates is recognized in income in the period that includes the enactment date. In addition, the amounts of any future tax benefits are reduced by a valuation allowance to the extent such benefits are not expected to be realized on a more likely than not basis. At December 31, 2002 and September 30, 2003 our gross deferred tax assets totaled $92.4 million and $94.0 million respectively, with corresponding valuation allowances of $0.6 million at both dates.

        Allowance for relocation properties held for resale.    An allowance is maintained for the amount by which the estimated price of our homes in inventory is less than the purchase price. If we experienced a reduction in the market value of the homes in inventory, additional allowances may be required. Our allowances for loss on the disposition of homes in inventory as of December 31, 2002 and September 30, 2003 amounted to $1.8 million, and $2.2 million, respectively. As of September 30, 2003, we reduced our allowance for relocation properties held for resale to 5.1% of our at-risk home inventory from 7.0% at December 31, 2002, which resulted in an increase in income of approximately $0.8 million. The reserve had been increased in 2002 and early 2003 due to concerns about a housing bubble and product mix change to shorter marketing periods prior to our acquiring the home into inventory, however, neither of these two concerns have materialized and the allowance was adjusted accordingly.

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Seasonality

        Our operations are subject to seasonal trends. Operating revenues and income from operations for the quarters ending in March and December are typically lower than the quarters ending in June and September. The stronger performance in the second and third quarters is due to the higher shipment count associated with the summer moving season, which also allows for somewhat higher pricing than in the winter months.

        The seasonal impact on our quarterly operating revenues and income from operations is illustrated by the following table showing quarterly operating revenues and income from operations as a percent of the total for the indicated full fiscal year:

	2001								2002
	Q1		Q2		Q3		Q4		Q1		Q2		Q3		Q4
Operating revenues	22	%	26	%	30	%	22	%	20	%	24	%	31	%	25	%
Income from operations	(8	)%	30	%	60	%	18	%	6	%	25	%	49	%	20	%

Foreign Currency Translation

        The vast majority of our operations incur expenses in the same currency in which the corresponding operating revenues are generated. As a consequence, the effects of foreign currency fluctuations on our operating results are principally limited to the translation of our activities outside of the United States from their local currency into the U.S. Dollar. Income from operations for 2002 from non-U.S. operations amounted to $26.9 million, or 28.5% of our consolidated income from operations. Additionally, a total of 37.0% of our long-lived assets at December 31, 2002 were denominated in currencies other than the U.S. Dollar. The functional currency for our non-U.S. subsidiaries is the local currency for the country in which the subsidiaries own their primary assets. We have operations in several foreign countries including those that use the Canadian dollar, the British pound sterling, the Australian dollar or the Euro as their functional currencies.

        The translation of the applicable currencies into U.S. Dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for revenue and expense accounts using a weighted average exchange rate during the period. The effect of U.S. Dollar currency exchange rates in Canada, the United Kingdom, the Euro zone, Australia and other countries in which we operate produced a net currency translation adjustment gain of $6.7 million and $5.0 million, net of tax, respectively, which were recorded as an adjustment to stockholders' equity as an element of other comprehensive income, for the year ended December 31, 2002 and the nine months ended September 30, 2003.

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Taxation

        For the nine months ended September 30, 2003 and the year ended December 31, 2002, our estimated provision for income taxes was lower than the amount computed by applying the U.S. federal and state statutory rates. This favorable difference is primarily due to (1) differences in the mix of the statutory rates between the U.S. and countries where we have permanently reinvested earnings, and (2) tax incentive programs that we have qualified for under the laws of certain jurisdictions. For the years ended December 31, 2000 and 2001, our estimated provision for income taxes was in excess of the amount computed by applying the U.S. federal and state statutory rates. This unfavorable difference was primarily due to (1) the non-deductibility of amortization expense associated with certain intangible assets and (2) limitations that existed in the availability of certain foreign income tax credits.

Results of Operations

        The following table sets forth information concerning our results of operations for the nine months ended September 30, 2002 and September 30, 2003 and the years ended December 31, 2000, 2001 and 2002, also expressed as a percentage of our operating revenues for the respective periods.

		Years Ended December 31,														Nine Months Ended September 30,
		2000					2001					2002				2002					2003
		(Dollars in millions)
Operating revenues		$	2,378.7		100.0	%	$	2,249.3		100.0	%	$	2,185.6	100.0	%	$	1,645.6		100.0	%	$	1,785.2		100.0	%
Operating expenses:
	Purchased transportation expense		1,559.8		65.6	%		1,438.8		64.0	%		1,303.2	59.6	%		990.6		60.2	%		1,002.1		56.1	%
	Other direct expenses		433.8		18.2	%		426.4		19.0	%		463.9	21.2	%		343.5		20.9	%		429.9		24.1	%
Gross margin			385.1		16.2	%		384.1		17.1	%		418.5	19.1	%		311.5		18.9	%		353.2		19.8	%
	General and administrative expense		319.9		13.4	%		315.8		14.0	%		319.9	14.6	%		236.9		14.4	%		252.4		14.1	%
	Goodwill and intangibles amortization		10.9		0.5	%		10.9		0.5	%		3.9	0.2	%		2.3		1.4	%		4.2		0.2	%
	Restructuring and other unusual items		4.9		0.2	%		4.9		0.2	%		0.4	0.0	%		(0.8	)	(0.1	)%		3.7		0.2	%
Income (loss) from operations(1)			49.4		2.1	%		52.5		2.3	%		94.3	4.3	%		73.1		4.4	%		92.9		5.2	%
	Non-operating expense (income)		(0.3	)	0.0	%		—		—			0.6	—			0.3		0.0	%		(0.2	)	0.0	%
	Interest expense		73.4		3.1	%		69.2		3.1	%		61.2	2.8	%		44.9		2.8	%		45.9		2.6	%
	Provisions (benefit) for income taxes		(1.8	)	(0.1	)%		(0.1	)	0.0	%		11.7	0.5	%		10.9		0.7	%		16.3		0.9	%
Cumulative effect of accounting change, net of tax			—		0.0	%		(0.3	)	0.0	%		—	—			—		—			—		—
Net income		$	(21.9	)	(0.9	)%	$	(16.9	)	(0.8	)%	$	20.8	1.0	%	$	17.0		1.0	%	$	30.9		1.7	%

(1)

For the nine months ended September 30, 2003, we recognized $3.0 million of non-cash equity-based compensation expense in relation to stock subscriptions and stock option grants made to certain managers and directors in June and August 2003. The expense has been recorded as the difference between the subscription or exercise price and the deemed fair value of our common and redeemable common stock on the date of grant in accordance with APB 25. The total non-cash equity-based compensation expense to be recognized by us in respect of these transactions is $6.7 million. We expect to recognize $0.5 million in the fourth quarter of 2003 and $1.5 million, $0.8 million, $0.5 million, $0.3 million and $0.1 million in each of 2004, 2005, 2006, 2007 and 2008 respectively.

        Operating Revenues.    Our operating revenues are derived from our Global Relocation Solutions, Network Services and Transportation Solutions operations.

        Operating revenues from our Global Relocation Solutions operations are comprised of amounts billed to each of our corporate, government and military and consumer customers upon the completion of relocation or transportation services. These include the provision of relocation and global mobility services such as home sale and purchase, realty and mortgage assistance, as well as comprehensive moving and storage services both at origin and destination. In addition, we bill our corporate customers for providing specialized transportation services for high value products that require specialized handling capabilities. In our U.S. and Canadian moving operations, a high percentage of the operating revenues generated is for services provided under exclusive contracts with our affiliated agents and owner/operators, the costs of which are included in Purchased Transportation Expenses.

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        Operating revenues from our Network Services segment include premiums billed for the provision of insurance coverage such as auto liability, occupational accident, physical damage and inland marine insurance coverage. Our operating revenues also include certain earned commissions for referring our clients to other insurance providers. Additionally, our operating revenues also include fees charged to the independent drivers in our association for access to a suite of services to independent truck drivers that includes fuel, cell phone, tire services, legal assistance and retirement programs, and the provision of maintenance and repair services.

        Operating revenues from our Transportation Solutions segment represent charges billed for our inventory management expertise which coordinates a variety of services such as purchased transportation, order fulfillment, project-specific delivery management, and the tracing of products through the customer's supply chains.

        Purchased transportation expense.    Purchased transportation expense, or PTE, represents amounts paid by us to independent third parties, such as agents, owner/operators, and third-party carriers for providing capabilities for the fulfillment of our customer moving and transportation needs.

•

In our Relocation Solutions—North America segment, PTE consists of amounts paid to owner/operators for transportation services; packing and loading service fees as well as associated assessorial services; agent commissions; and other third party transportation services.



•

In our Relocation Solutions—Europe & Asia Pacific segment, where we own most of our fulfillment network, our PTE consists of amounts paid to third parties for supplemental transportation, packing and loading services provided during peak periods, and costs associated with other modes of transportation, such as ocean freight.



•

In our Transportation Solutions segment, PTE consists of amounts paid for owner/operator transportation, fees associated with providing specialized handling and delivery services, as well as third-party carrier costs of various modes, such as air freight costs.

        Given the structure of our overall business model, which uses independent agents, owner/operators and third-party carriers of various modes to provide transportation, including trucks and trailers, as well as warehouse facilities for storage and delivery programs, a high proportion of overall operating expenses are represented by PTE. The level of PTE generally increases or decreases in proportion to the operating revenues generated from moving and transportation services provided by our independent agent network, as PTE compensation rates are typically determined based on a percentage of revenue that is set by contracts between us and our agents and owner-operators.

        Other direct expenses:    Other direct expenses are comprised of our own facility and equipment costs; employee labor costs; commissions paid to realtors, home closing costs and other relocation service fees in addition to transportation cargo loss and damage expenses and claims costs and loss adjustment expenses associated with our various insurance offerings. Relocation Solutions—Europe & Asia Pacific and Transportation Solutions have more significant levels of direct expenses than our moving services operations in North America.

        Gross margin:    Our gross margin in absolute terms is equal to our operating revenues less direct expenses. Gross margin as a percentage of operating revenues, or gross margin rate, is largely dependent on the mix of our services to customers, and can differ between each of our four operating segments. As discussed above, our Relocation Solutions—North America segment operates with an asset-light model, utilizing our proprietary branded network of agents and independent contractors to service our customers. This results in a significantly higher level of expenses being paid to our agents and independent contractors and thus a lower gross margin in percentage terms, than our Relocation Solutions—Europe & Asia Pacific business, which predominantly utilizes an owned network to fulfill customer requirements. This is contrasted by a traditionally lower level of general and administrative costs as a percentage of our operating revenues in Relocation Solutions—North America as compared to Relocation Solutions—Europe & Asia Pacific. Recently, the increase in non-moving relocation services in the U.S. also has a margin mix impact as compared to our moving operations, as such relocation services have proportionally lower PTE and other direct expenses, a higher gross margin, and higher G&A costs associated with coordinating and administering services.

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        Gross margin as a percentage of operating revenues in our Network Services and Transportation Solutions businesses also differ from those experienced in our Global Relocation Solutions operations. Traditionally, the gross margin rate in our Network Services segment, which is predominantly an insurance business (premiums less claim expenses), and in our Transportation Solutions segment (operating revenues less direct expenses) have been higher, with a proportionally higher G&A expense as compared to our moving services and specialized transportation operations in North America.

        General and administrative expense:    General and administrative expense, or G&A expense, includes employee compensation and benefit costs, which account for over 50% of expenses in this category, as well as IT infrastructure and communication costs, office rent and supplies, professional services and other general corporate expenses. Relocation Solutions—Europe & Asia Pacific, Transportation Solutions and our relocation services operations in North America have a more significant level of G&A expenses than do our moving services and specialized transportation operations in North America.

Nine Months Ended September 30, 2003 Compared to Nine Months Ended September 30, 2002.

        Operating revenues:    Our operating revenues were $1,785.2 million for the nine months ended September 30, 2003, which represents a $139.6 million, or an 8.5% increase, compared to $1,645.6 million for the nine months ended September 30, 2002.

        The increase in operating revenues was primarily a result of growth in our Relocation Solutions—North America and Network Services segments, which reported increases in operating revenues of $67.3 million and $28.0 million, respectively, period-over-period. These increases are a result of two key factors: first, the acquisitions of NAIT in April 2002 and CRS in May 2002, and second, the significant growth that these businesses have experienced since their acquisition by SIRVA. From April 2002 through September 30, 2003, we have grown the number of members of NAIT by 86.5%. The number of corporate relocation initiations in the relocation services business involving more than simple household goods movement increased by 35.7% during the nine months ended September 30, 2003, compared to the nine months ended September 30, 2002. For comparative purposes, the number of initiations includes four months of operating data for CRS in 2002 prior to the acquisition. Operating revenues in Relocation Solutions—Europe & Asia Pacific increased $50.8 million period-over-period, largely as a result of $34.9 million of favorable currency impact. These gains were offset in part by a $6.5 million decrease in operating revenues from Transportation Solutions due primarily to lower program volumes.

        Gross Margin:    Gross margin was $353.2 million for the nine months ended September 30, 2003, which represents a $41.7 million, or 13.4% increase, compared to $311.5 million for the nine months ended September 30, 2002. The growth in gross margin dollars was due to an overall increase in revenue driven in large part by the acquisitions of NAIT and CRS and an overall improvement in gross margin rate.

        Our gross margin as a percentage of operating revenues for the nine months ended September 30, 2003 was 19.8%, which represents a 0.9 percentage point increase, compared to 18.9% for the nine months ended September 30, 2002. The change in gross margin as a percentage of operating revenues is explained later in our segment analysis.

        General and administrative expenses:    G&A expenses for the nine months ended September 30, 2003 were $253.2 million, which represents a $16.3 million, or 6.9% increase, compared to $236.9 million for the nine months ended September 30, 2002. The dollar increase in G&A expense is primarily due to additional costs from the inclusions of NAIT and CRS for the full nine-month period in 2003, as well as $9.5 million of unfavorable currency impact.

        Our G&A expenses as a percentage of operating revenues were 14.4% and 14.2% for the nine months ended September 30, 2002 and 2003, respectively. The negative mix effect of growth in businesses with a higher proportion of G&A as a percentage of revenue was offset by continued improvements in productivity. Reflecting this improved productivity, our consolidated headcount was 7,782 as of September 30, 2003, which represents a 355 person, or 4.4% decrease, from 8,137 as of September 30, 2002. Operating revenues per employee at September 30, 2003 were $309,300, which represents a $33,800, or 12.3% increase, compared to $275,500 at September 30, 2002.

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We have both streamlined our organization and initiated business process improvement projects which allowed us to further reduce headcount during a period when operating revenues increased. We define operating revenues per employee as operating revenues for the twelve-month period ending on the date indicated, divided by the corresponding twelve-month average of company-wide end-of-month employee headcount.

        Intangibles amortization:    Amortization for the nine months ended September 30, 2003 was $4.2 million, which represents a $1.9 million increase, compared to $2.3 for the nine months ended September 30, 2002. This increase is directly related to the acquisitions made in 2002.

        Restructuring:    In the nine months ended September 30, 2002, we released into income $0.8 million of restructuring reserves pertaining to the parts centers previously operated by our Transportation Solutions business. The original provision was established in 2001, and the release in 2002 was due to our ability to sublease certain facilities earlier than originally anticipated.

        Equity Based Compensation Expense:    For the nine months ended September 30, 2003, we recognized $3.0 million of non-cash equity-based compensation expense in relation to stock subscription and stock option grants made to certain managers and directors in June and August 2003. The expense has been recorded as the difference between the subscription or exercise price and the deemed fair value of our common and redeemable common stock on the date of grant in accordance with APB 25.

        Income from operations:    Income from operations was $92.9 million for the nine months ended September 30, 2003, which represents a $19.8 million, or 27.1% increase, compared to $73.1 million for the nine months ended September 30, 2002. The gain reflects the improved operating results in most of our businesses, the year-over-year operating revenues growth following the acquisitions of NAIT and CRS and a 0.9 percentage point increase in gross margin as a percent of operating revenues.

        Interest Expense:    Interest expense was $45.9 million for the nine months ended September 30, 2003, which represents a $1.0 million, or 2.2% increase, compared to $44.9 million for the nine months ended September 30, 2002. The increase is due primarily to higher average borrowings related to our financing of our 2002 acquisitions, offset by lower interest rates. For the nine months ended September 30, 2003, we recorded $1.0 million of interest expense which had been previously treated as accretion of junior preferred stock dividends as a result of our adoption of FAS 150.

        Income Tax:    For the nine months ended September 30, 2003, our estimated provision for income taxes was $16.2 million based on pre-tax income of $47.1 million, an effective tax rate of 34.4%. For the nine months ended September 30, 2002, our estimated provision for income taxes was $10.9 million based on pre-tax income of $27.9 million, an effective tax rate of 39.1%. The reduction in our tax rate is primarily due to (1) differences in the statutory rates between the U.S. and countries where we have reinvested earnings, and (2) tax incentive programs for which we have qualified under the laws of certain jurisdictions.

        Net Income:    Net income was $30.9 million, or $0.51 per share for the nine months ended September 30, 2003, which represents a $13.9 million, or $0.22 per share increase, compared to a $17.0 million or $0.29 per share net income for the nine months ended September 30, 2002. This improvement reflects the success of our strategy of focusing on relocation services and its associated growth in operating revenues and income from operations, along with the impact of our acquisitions, which continue to enhance our global service offering.

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Segment Analysis

        The following table sets forth information with respect to our segments:

		Relocation Solutions
		Nine Months Ended September 30, 2003
		North America			Europe & Asia Pacific			Network Services			Transportation Solutions			Corporate			Total SIRVA
		(Dollars in millions)
Operating revenues		$	1,240.4		$	350.9		$	117.9		$	76.0		$	—		$	1,785.2
Operating expenses:
	Purchased transportation expense		888.5			94.6			—			19.0			—			1,002.1
	Other direct expenses		185.0			133.4			79.7			31.5			0.3			429.9
Gross margin		$	166.9		$	122.9		$	38.2		$	25.5		$	(0.3	)	$	353.2
Gross margin as a percentage of operating revenues			13.4	%		35.0	%		32.4	%		33.6	%		—			19.8	%
Income from operations(1)		$	44.9		$	23.8		$	26.1		$	1.8		$	(3.7	)	$	92.9

		Relocation Solutions
		Nine Months Ended September 30, 2002
		North America			Europe & Asia Pacific			Network Services			Transportation Solutions			Corporate			Total SIRVA
		(Dollars in millions)
Operating revenues		$	1,173.1		$	300.1		$	89.9		$	82.5		$	—		$	1,645.6
Operating expenses:
	Purchased transportation expense		888.6			80.1			—			21.9			—			990.6
	Other direct expenses		136.4			114.0			60.1			32.8			0.2			343.5
Gross margin		$	148.1		$	106.0		$	29.8		$	27.8		$	(0.2	)	$	311.5
Gross margin as a percentage of operating revenues			12.6	%		35.3	%		33.1	%		33.7	%		—			18.9	%
Income from operations		$	35.2		$	17.2		$	17.9		$	3.8		$	(1.0	)	$	73.1
Key Performance Indicators, 2003 vs. 2002:
	Percent change in operating revenues		5.7	%		16.9	%		31.1	%		(7.9	)%		—			8.5	%
	Percentage point change in gross margin as a percentage of operating revenues		0.8			(0.3	)		(0.7	)		(0.1	)		—			0.9

(1)

For the nine months ended September 30, 2003, we recognized $3.0 million of non-cash equity-based compensation expense in relation to stock subscriptions and stock option grants made to certain managers and directors in June and August 2003. The expense has been recorded as the difference between the subscription or exercise price and the deemed fair value of our common and redeemable common stock on the date of grant in accordance with APB 25. The total non-cash equity-based compensation expense to be recognized by us in respect of these transactions is $6.7 million. We expect to recognize $0.5 million in the fourth quarter of 2003 and $1.5 million, $0.8 million, $0.5 million, $0.3 million and $0.1 million in each of 2004, 2005, 2006, 2007 and 2008 respectively.

Relocation Solutions—North America

        Operating revenues were $1,240.4 million for the nine months ended September 30, 2003, which represents a $67.3 million, or 5.7% increase, compared to $1,173.1 million for the nine months ended September 30, 2002.

        Operating revenues from our relocation services offering increased $70.2 million for the nine months ended September 30, 2003 as compared to the nine months ended September 30, 2002. This growth is primarily attributable to the inclusion of CRS for a full nine months in 2003, compared to only five months in 2002, and the growth that we have experienced in this business since its acquisition in May 2002. Reflecting the successful integration of CRS into SIRVA Relocation, the number of corporate relocation initiations in the relocation services business involving more than simple household goods movement increased by 35.7% during the nine months ended September 30, 2003, compared to the nine months ended September 30, 2002. For comparative purposes, the number of initiations includes four months of operating data for CRS in 2002 prior to the acquisition. Additionally, operating revenues from our household goods moving services offerings increased by $17.9 million in the nine months ended September 30, 2003 when compared to the nine months ended September 30, 2002. Household goods shipments decreased 3.2% for the nine months ended September 30, 2003 compared to the nine months ended September 30, 2002, however, the volume decrease was more than offset by an increase in revenue per

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shipment during the same period. These increases were partially offset by a decline in our specialized transportation service offering of $20.8 million reflecting 4.9% fewer shipments in 2003 when compared to 2002.

        Gross margin was $166.9 million for the nine months ended September 30, 2003, representing a $18.8 million, or 12.7% increase, compared to $148.1 million for the nine months ended September 30, 2002. Growth in gross margin dollars was primarily attributable to the year-over-year affect of the CRS acquisition, which occurred in May 2002 and the margin associated with the growth that has been achieved since the acquisition. Gross margin as a percentage of operating revenues was 13.4% for the nine months ended September 30, 2003, which represents a 0.8 percentage point increase, compared to 12.6% for the nine months ended September 30, 2002. This reflects a shift in product mix to relocation services which has a higher gross margin rate than our traditional moving services operations.

        Income from operations was $44.9 million for the nine months ended September 30, 2003, which represents a $9.7 million, or 27.6% increase, compared to $35.2 million for the nine months ended September 30, 2002, reflecting the increased gross margin rate associated with the CRS acquisition and the subsequent growth of SIRVA Relocation, offset in part by the G&A costs associated with the acquired business.

Relocation Solutions—Europe & Asia Pacific

        Operating revenues were $350.9 million for the nine months ended September 30, 2003, which represents a $50.8 million, or 16.9% increase, compared to $300.1 million for the nine months ended September 30, 2002.

        The increase in operating revenues is primarily a result of $34.9 million of favorable currency impact as, during the nine months ended September 30, 2003, the average value of the Pound Sterling, the Australian dollar and the Euro were stronger as compared to the U.S. dollar for the nine months ended September 30, 2002 by approximately 9%, 17% and 21%, respectively. The remainder of the increase was the result of the continued expansion of our records management business and strategic acquisitions completed to enhance our European growth platform, offset by the divestiture of a non-core industrial-moving business in the U.K.

        Gross margin was $122.9 million for the nine months ended September 30, 2003, which represents a $16.9 million, or 15.9% increase, compared to $106.0 million for the nine months ended September 30, 2002. The dollar increase is primarily due to $10.5 million of favorable currency impact and the Scanvan acquisition. The gross margin as a percentage of operating revenues was 35.0% for the nine months ended September 30, 2003, which represents a 0.3 percentage point decrease, compared to 35.3% for the nine months ended September 30, 2002, reflecting U.K. domestic business price pressures partially offset by growth in records management and the divestiture of a low-margin industrial moving business in the U.K.

        Income from operations was $23.8 million for the nine months ended September 30, 2003, which represents a $6.6 million, or 38.3% increase, compared to $17.2 million for the nine months ended September 30, 2002, which was primarily driven by higher gross margins and lower general and administrative costs as a percentage of operating revenues reflecting the results of a strict cost control program imposed as a result of the sluggish economy. During the nine months ended September 30, 2003 we sold our Sydney, Australia facility for a gain of $1.8 million. We will lease back the facility for approximately six months until such time as our new facility construction is complete.

Network Services

        Operating revenues were $117.9 million for the nine months ended September 30, 2003, which represents a $28.0 million, or 31.1% increase, compared to $89.9 million for the nine months ended September 30, 2002. This growth is primarily attributable to the inclusion of NAIT for a full nine months in the 2003 period, compared to only six months in 2002, and the integration of NAIT into SIRVA which has enabled us to offer our pre-existing range of fleet and insurance services to the NAIT membership base. In addition to the growth in our client base, operating revenues have increased due to the insurance environment since September 11, 2001, which has generally resulted

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in certain premiums increasing in the nine months ended September 30, 2003, compared to the nine months ended September 30, 2002.

        Gross margin was $38.2 million for the nine months ended September 30, 2003, which represents an $8.4 million, or 28.2% increase, compared to $29.8 million for the nine months ended September 30, 2002. Growth in gross margin dollars was primarily attributable to the year-over-year effect of the NAIT acquisition, which occurred at the beginning of April 2002, and the margin associated with the growth that has been achieved since acquisition. Gross margin as a percentage of operating revenues was 32.4% for the nine months ended September 30, 2003, which represents a 0.7 percentage point decrease, compared to 33.1% for the nine months ended September 30, 2002. The decrease was primarily driven by $1.7 million return of premium from one of our reinsurance providers in the nine months ended September 30, 2002, which increased gross margin in that period. This impact was partially offset by the substantial increase in our independent contractor insurance portfolio, which has higher gross margin rate characteristics than our agent and small fleet insurance packages as well as our fleet maintenance operations.

        Income from operations was $26.1 million for the nine months ended September 30, 2003, representing a $8.2 million, or 45.8% increase, compared to $17.9 million for the nine months ended September 30, 2002. This increase reflects the gross margin gains associated with the acquisition and subsequent growth of NAIT, growth in our existing business, higher overall premium rates due to market conditions and G&A expense efficiencies driven by our progressive integration of our network services operations.

Transportation Solutions

        Operating revenues were $76.0 million for the nine months ended September 30, 2003, which represents a $6.5 million, or 7.9% decrease, compared to $82.5 million for the nine months ended September 30, 2002. This reduction was primarily due to a continued decrease in program activity for the technology sector customers we serve.

        Gross margin was $25.5 million for the nine months ended September 30, 2003, representing a $2.3 million, or 8.3% decrease, compared to $27.8 million for the nine months ended September 30, 2002. The decrease in gross margin dollars is primarily a result of the aforementioned decline in operating revenues and an overall slight decrease in gross margin rate. The gross margin as a percentage of operating revenues was 33.6% for the nine months ended September 30, 2003, which represents a 0.1 percentage point decrease, compared to 33.7% for the nine months ended September 30, 2002. This reduction is primarily due to a change in the mix of the many customized service packages that we provide to our customer base.

        Income from operations was $1.8 million for the nine months ended September 30, 2003, which represents a $2.0 million, or 52.6% decrease, compared to $3.8 million for the nine months ended September 30, 2002. The decline in operating income is principally in line with the reduction in gross margin. While the underlying cost structure was reduced, the decline in costs was mitigated by the incremental expense of implementing new technologies. In addition, the nine months ended September 30, 2002 included a $0.8 million restructuring credit pertaining to the parts centers previously operated through June 2001.

Corporate

        For the nine months ended September 30, 2003, we incurred $3.8 million of corporate expense comprised of $3.0 million of non-cash equity-based compensation expense and $0.8 million of general corporate expenses. The non-cash equity-based compensation expense is related to stock subscriptions and stock option grants made to certain managers and directors in June and August 2003. The expense has been recorded as the difference between the subscription or exercise price and the deemed fair value of our common and redeemable common stock on the date of grant in accordance with APB 25. For the nine months ended September 30, 2002, we incurred $1.0 million of general corporate expenses.

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Year Ended December 31, 2002 Compared to Year Ended December 31, 2001

        Operating revenues:    Our operating revenues were $2,185.6 million for the year ended December 31, 2002, which represents a $63.7 million, or 2.8% decrease, compared to $2,249.3 million for the year ended December 31, 2001.

        The change in operating revenues was most significant in Relocation Solutions—North America, where the decrease of 6.5% was largely driven by reduced demand for our household goods moving and specialized transportation services. Household goods shipments decreased by 9.5% for the year ended December 31, 2002 compared to the year ended December 31, 2001, and were significantly influenced by fewer transferees in the corporate sector due to a sharp fall off in relocations in the months following the events of September 11, 2001 and, we believe, to the sluggish economy. Specialized transportation shipments for the year ended December 31, 2002 were down approximately 3.5%, compared to 2001 and revenue per shipment decreased approximately 12.3% year-over-year. We believe these are both a direct result of the substantial falloff in activities in the telecommunications and technology sectors as the economy slowed. This slowdown in the telecommunications and technology sectors also affected our Transportation Solutions segment which, although smaller, was down 14.1%.

        Partly offsetting the operating revenues decline in our moving and specialized transportation service offerings was the impact of our acquisitions during the year ended December 31, 2002, including $73.4 million of operating revenues in relocation services following the CRS acquisition. The year-over-year revenue effect above includes the growth achieved as these two businesses were integrated into the larger SIRVA organization. By facilitating access to our corporate customer base and offering them a new suite of relocation services, we were able to increase the number of corporate relocation initiations in the relocation services business involving more than simple household goods movement by 17.1% during the year ended December 31, 2002. For comparative purposes, the number of initiations includes operating data for CRS for all of 2001 and four months of 2002 prior to the acquisition.

        Also offsetting the aforementioned revenue decline, operating revenues in our Relocation Solutions—Europe & Asia Pacific were up 5.4%, primarily as a result of $22.3 million of favorable currency impact.

        Gross margin:    Our gross margin was $418.5 million for the year ended December 31, 2002, which represents a $34.4 million, or 9.0% increase, compared to $384.1 million for the year ended December 31, 2001, despite the 2.8% decrease in our operating revenues. The gains were most significant in Relocation Solutions—North America and Network Services. Contributing to the improved gross margin in 2002 versus 2001 was a reduction in cargo claims expense. A cargo claims analysis is performed each quarter comparing open and closed claim costs, as well as estimates for incurred but not reported claim costs, to the original estimates, and changes to those estimates are recorded as appropriate. We recognized favorable accrual adjustments related to prior year estimates of $5.4 million for the year ended December 31, 2002. These favorable adjustments were a result of improved experience, when compared to historical trends and estimates, for claims made in policy years 2001 and prior that were finalized in 2002. This improved claims experience was attributable to a combination of reduced shipment volumes and new quality control initiatives implemented by us during 2001 that reduced the frequency of claims.

        Our gross margin as a percentage of operating revenues was 19.1% for the year ended December 31, 2002, which represents a 2.0 percentage point increase, compared to 17.1% for the year ended December 31, 2001. The change in gross margin as a percentage of operating revenues is explained in our segment analysis below.

        General and administrative expenses:    G&A expenses were $319.9 million for the year end December 31, 2002, which represents a $4.1 million, or 1.3% increase, compared to $315.8 million for the year ended December 31, 2001. The dollar increase in G&A expense is a result of an increase associated with our acquisitions of CRS and NAIT, along with unfavorable currency impact of $5.4 million. These increases were offset by reductions in headcount and other G&A costs in our moving services, specialized transportation and transportation solutions business in order to align expenses with lower operating revenues. Our G&A expenses as a percent of operating revenues for the year ended December 31, 2002 was 14.7%, which represents an increase of 0.7 percentage points, as compared to 14.0% for the year ended December 31, 2001. The percentage change is largely due to the increased

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proportion of our Relocation Services and Network Services businesses within our overall business mix and currency-related increases to our foreign G&A costs, partially offset by productivity improvements throughout our transportation and solutions businesses.

        Reflecting this improved efficiency, our consolidated head count decreased to 7,500 as of December 31, 2002, a decrease of 295, or 3.4%, from 7,795 as of December 31, 2001. Operating revenues per employee were $283,800 as of December 31, 2002, which represents a $2,900, or 1.0% increase, compared to $280,900 as of December 31, 2001. We both streamlined our organization and reduced headcount in order to align expenses with lower operating revenue.

        Goodwill and intangibles amortization:    Effective January 1, 2002, we adopted SFAS No. 142, "Goodwill and Other Intangible Assets", under which goodwill and other indefinite-lived intangible assets are no longer amortized but are reviewed at least annually for impairment. As a result, amortization expense was $3.9 million for the year ended December 31, 2002, which represents a $7.0 million, or 64.2% decrease, compared to $10.9 million for the year ended December 31, 2001, related to SFAS 142, offset by additional intangible amortization of $3.9 million from our acquisitions in the year ended December 31, 2002.

        Asset impairment charge:    For the year ended December 31, 2002, we incurred $7.1 million of software impairment charges. In the fourth quarter 2002, it became clear that the forecasted growth in our specialized transportation business unit that had been central to our previous i2 investment decision was not expected to be as significant as originally anticipated. As a consequence, we made a decision to change our IT implementation strategy and scale back future IT investment in these operations. Accordingly, in December 2002 we wrote off costs capitalized in relation to those modules that had been purchased but would no longer be implemented.

        Curtailment and other gains:    For the year ended December 31, 2002, we incurred $10.4 million of curtailment and other gains consisting of a $7.4 million curtailment gain resulting from the freezing of the U.S. pension plan and the reduction of retiree medical benefits and a $3.0 million gain from the sale of our U.K. industrial moving business.

        Restructuring and headquarters move:    For the year ended December 31, 2002, we incurred $3.7 million of restructuring and headquarters move expense consisting of $4.6 million of expenses related to the December 2002 SIRVA headquarters move, partially offset by $0.9 million of restructuring credit pertaining to the parts centers restructuring that we started in 2001, principally as a result of our entering into subleases of certain parts centers facilities earlier than originally estimated. Restructuring expense for the year ended December 31, 2001 was due primarily to the parts center restructuring.

        Income from operations:    Income from operations was $94.3 million for the year ended December 31, 2002, which represents a $41.8 million, or 79.6% increase, compared to $52.5 million for the year ended December 31, 2001. The substantial gain principally reflects the impact of our acquisitions and an increase in gross margin as a percent of operating revenues. Additionally, we ceased amortization of goodwill, which reduced our amortization expense by $10.9 million compared to the year ended December 31, 2001.

        Interest:    Interest expense was $61.2 million for the year ended December 31, 2002, which represents a $8.0 million, or 11.6% decrease, compared to $69.2 million for the year ended December 31, 2001, due primarily to lower interest rates and lower average borrowings.

        Income Tax:    Income tax expense was $11.7 million for the year ended December 31, 2002, based on pre-tax income of $32.5 million, given an effective rate of 36.0%. For the year ended December 31, 2001, the income tax benefit was $0.1 million based on a pre-tax loss of $16.7 million.

        Net Income:    Net income was $20.8 million or $0.33 per share for the year ended December 31, 2002, which represents a $37.7 million or $0.81 per share increase, compared to a loss of $16.9 million or $0.48 per share for the year ended December 31, 2002. This improvement reflects the substantial gains in operating income combined with the reduction in our interest expense over the year ended December 31, 2001. The impact, net of taxes, of the

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favorable accrual adjustments to our cargo claims reserves in the year ended December 31, 2002 was $3.4 million or $0.07 per share-basic, or $0.07 per share-diluted.

Segment Analysis

        The following table sets forth information with respect to our segments, which provides a more complete understanding of the key drivers of our operating performance:

		Relocation Solutions
		Year Ended December 31, 2002
		North America			Europe & Asia Pacific			Network Services			Transportation Solutions			Corporate			Total SIRVA
		(Dollars in millions)
Operating revenues		$	1,544.4		$	408.0		$	125.0		$	108.2		$	—		$	2,185.6
Operating expenses:
	Purchased transportation expense		1,164.8			110.5			—			27.9			—			1,303.2
	Other direct expenses		182.8			153.2			83.6			44.1			0.2			463.9
Gross margin		$	196.8		$	144.3		$	41.4		$	36.2		$	(0.2	)	$	418.5
Gross margin as a percentage of operating revenues			12.7	%		35.4	%		33.1	%		33.5	%		—			19.1	%
Income from operations		$	41.0		$	24.8		$	26.5		$	3.3		$	(1.3	)	$	94.3

		Relocation Solutions
		Year Ended December 31, 2001
		North America			Europe & Asia Pacific			Network Services			Transportation Solutions			Corporate			Total SIRVA
		(Dollars in millions)
Operating revenues		$	1,652.1		$	387.1		$	84.2		$	125.9		$	—		$	2,249.3
Operating expenses:
	Purchased transportation expense		1,309.0			105.6			—			24.2			—		$	1,438.8
	Other direct expenses		161.6			140.7			61.5			62.6			—		$	426.4
Gross margin		$	181.5		$	140.8		$	22.7		$	39.1		$	—		$	384.1
Gross margin as a percentage of operating revenues			11.0	%		36.4	%		27.0	%		31.1	%		—			17.1	%
Income from operations		$	15.1		$	26.0		$	18.5		$	(6.3	)	$	(0.8	)	$	52.5
Key Performance Indicators, 2002 vs. 2001:
	Percent change in operating revenues		(6.5	)%		5.4	%		48.5	%		(14.1	)%		—			(2.8	)%
	Percentage point change in gross margin as a percentage of operating revenues		1.7			(1.0	)		6.1			2.4			—			2.0

Relocation Solutions—North America

        Operating revenues were $1,544.4 million for the year ended December 31, 2002, representing a $107.7 million, or 6.5% decrease, compared to $1,652.1 million for the year ended December 31, 2001.

        Operating revenues for our household goods moving and specialized transportation service offerings decreased by approximately 10.4% and 12.9% respectively, driven principally by reduced demand. Household goods shipments for the year ended December 31, 2002, decreased 9.5% from the year ended December 31, 2001, and were significantly influenced by fewer transferees in the corporate sector due to a sharp fall off in relocations following the events of September 11, 2001 and, we believe, to the sluggish economy. Specialized transportation shipments for the year ended December 31, 2002 were also down approximately 3.5%, compared to 2001, and revenue per shipment decreased approximately 12.3% year-over-year. We believe these are both a direct result of the substantial decline in activities in the telecommunications and technology sectors as the economy slowed.

        Partly offsetting the decline in moving and specialized transportation service offerings was an increase in operating revenues of $73.4 million from our relocation services operations following the CRS acquisition in May 2002. With the benefit of joining the much larger SIRVA organization and gaining access to its expansive list of corporate moving customers, our relocation services offering has also experienced an accelerated growth rate. Specifically, the number of CRS corporate relocation initiations in the relocation services business involving more

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than simple household goods movement increased by 17.1% during the year ended December 31, 2002 compared to the year ended December 31, 2001. For comparative purposes, the number of initiations includes operating data for CRS for all of 2001 and four months of 2002 prior to the acquisition.

        Gross margin was $196.8 million for the year ended December 31, 2002, representing a $15.3 million, or 8.4% increase, compared to $181.5 million for the year ended December 31, 2001, despite the 6.5% decrease in our operating revenues. Within this segment, gross margin dollars in our moving services and specialized transportation business decreased by $13.9 million for the year ended December 31, 2002 as compared to 2001. The decrease was due to lower shipment volumes in both units, reduced gross margin as a percentage of operating revenues in specialized transportation, due to lower revenue per shipment and a higher proportion of fixed costs, partially offset by lower cargo loss and damage and other direct expenses in our moving services operations.

        This decline in gross margin dollars, however, was more than offset by the acquisition of CRS and the inclusion of its results from May 2002 forward.

        Gross margin as a percentage of operating revenues was 12.7% for the year ended December 31, 2002, which represents an increase of 1.7 percentage points, compared to 11.0% for the year ended December 31, 2001. The improved gross margin rate is due in large measure to the enhanced mix resulting from acquiring and selling more high margin, value-added relocation services. Due to the significance of PTE expenses paid to owner/operators and agents who provide equipment and labor, there is a lower gross margin percentage associated with moving and specialized transportation operating revenues than with relocation services. Our mix was enhanced by the faster growth in relocation services.

        Income from operations was $41.0 million for the year ended December 31, 2002, which represents a $25.9 million, or 171.5% increase, compared to $15.1 million for the twelve months ended December 31, 2001.

The most significant factor leading to the increase in income from operations during 2002 was the acquisition in May 2002 of CRS which added $10.6 million of operating profit for the eight months following acquisition. The impact of the CRS acquisition on our results for 2002 can be summarized as follows:

	$ in millions
Revenue	71.2
Gross margin	26.9
G&A	16.3
Income from operations	10.6

Income from operations in our moving services business also increased $15.3 million due to lower general and administrative expenses, goodwill amortization and internet development costs offsetting lower gross margins and a software impairment charge. The decline of $16.5 million in general and administrative expenses was driven by substantial headcount reductions and additional cost and program cuts. The lower goodwill amortization of $6.1 million was the result of adoption of SFAS 142. In 2002 we significantly reduced our development of a web-based moving services solution aimed at the consumer market resulting in lower expense of $11.3 million. These favorable impacts were partially offset by a decline in gross margin of $12.9 million due to lower shipment activity and the $5.7 million impairment charge associated with the abandonment of certain modules of the previously capitalized i2 software that had been planned for use in our specialized transportation operations.

Relocation Solutions—Europe & Asia Pacific

        Operating revenues were $408.0 million for the year ended December 31, 2002, representing a $20.9 million, or 5.4% increase, compared to $387.1 million for the year ended December 31, 2001.

        The increase in operating revenues is predominantly a result of $22.3 million of favorable currency impact as, during the year ended December 31, 2002, the average values of the Pound Sterling, the Australian dollar and the Euro were stronger against the U.S. dollar compared to the year ended December 31, 2001 by approximately 4%,

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5% and 5%, respectively. In addition, operating revenues in our UK records management business and the domestic and international moving business in Australia were somewhat higher year-over-year.

        Gross margin was $144.3 million for the year ended December 31, 2002, which represents a $3.5 million or 2.5% increase, compared to $140.8 million for the year ended December 31, 2001. While gross margin increased $7.5 million largely as a result of the currency driven increase in operating revenue, gross margin as a percentage of operating revenues was 35.4% for the year ended December 31, 2002, a 1.0 percentage point decrease, compared to 36.4% for the year ended December 31, 2001. The decrease is associated with overall price pressure, particularly in our industrial moving business, which we sold at the end of 2002. In addition, we experienced higher employee benefits costs.

        Income from operations was $24.8 million for the year ended December 31, 2002, which represents a $1.2 million, or 4.6% decrease, compared to $26.0 million for the year ended December 31, 2001. The increase in aggregate gross margin dollars of $3.5 million, and the favorable impact of eliminating goodwill amortization of $4.2 million were more than offset by $5.5 million of unfavorable currency impact in G&A, higher employee benefit costs and a $2.4 million severance charge taken during the year to adjust headcount to the reduced business needs.

Network Services

        Operating revenues were $125.0 million for the year ended December 31, 2002, which represents a $40.8 million, or 48.5% increase, compared to $84.2 million for the year ended December 31, 2001. Growth in operating revenues was a result of two key factors: the acquisition of NAIT in April 2002 which increased our underwriting volume, as well as growth in this business. In addition to the growth in our client base, operating revenues have increased due to the insurance environment since September 11, 2001, which has generally resulted in certain year-over-year premium increases since that time.

        Gross margin was $41.4 million for the year ended December 31, 2002, which represents a $18.7 million or 82.4% increase, compared to $22.7 million for the year ended December 31, 2001. Gross margin as a percentage of operating revenues was 33.1% for the year ended December 31, 2002, which represents a 6.1 percentage point increase, compared to 27.0% for the year ended December 31, 2001. This improvement was primarily driven by the NAIT acquisition and subsequent growth in our independent contractor insurance portfolio, which has higher gross margin characteristics than our agent and small fleet businesses. We were also able to realign the structure used to underwrite the independent contractor insurance program, further improving overall gross margin. The improved gross margin as a percentage of operating revenues also reflects favorable development in actuarially determined insurance claim reserves of $1.7 million, and therefore a reduction to our overall claims expenses. These gains were partly offset by higher costs for reinsuring a portion of our insurance portfolio.

        Income from operations was $26.5 million for the year ended December 31, 2002, which represents an $8.0 million, or 43.2% increase, compared to $18.5 million for the year ended December 31, 2001. The increase was due to our acquisitions, higher independent contractor insurance operating revenues, growth in our customer base and associated gross margin improvements of $18.7 million, less G&A increases associated with our acquisition and growth and the amortization of $1.5 million of newly acquired intangibles with definite lives.

Transportation Solutions

        Operating revenues were $108.2 million for the year ended December 31, 2002, which represents a $17.7 million, or 14.1% decrease, compared to $125.9 million for the year ended December 31, 2001.

        Operating revenues for the year ended December 31, 2002 decreased as result of our withdrawal from the parts center business which contributed $14.5 million in operating revenues for the year ended December 31, 2001. Operating revenues were also lower as a result of reduced activity levels in our freight forwarding operations due, we believe, to the general economic slowdown. These items were partially offset by new volume due to the addition of new customers and increased program volume with existing customers.

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        Gross margin was $36.2 million for the year ended December 31, 2002, which represents a $2.9 million or 7.4% decrease compared to $39.1 million for the year ended December 31, 2001. The decrease is a result of lower overall operating revenues, offset by an improvement in the overall gross margin rate. Gross margin as a percentage of operating revenues was 33.5% for the year ended December 31, 2002, which represents a 2.4 percentage point increase compared to 31.1% for the year ended December 31, 2001. The positive change in the gross margin as a percentage of operating revenues resulted primarily from our strategic withdrawal from the lower margin parts center business in the latter part of 2001.

        Income from operations was $3.3 million for the year ended December 31, 2002, which represents a $9.6 million increase, compared to a loss of $6.3 million for the year ended December 31, 2001. While gross margin decreased $2.9 million year-over-year, we rationalized our underlying cost base, resulting in $7.3 million lower general and administrative expenses year-over-year and we ceased amortization of $0.4 million goodwill in the year ended December 31, 2002. Income from operations for the year ended December 31, 2001 includes $3.9 million of severance and redundant facility expenses associated with our withdrawal from the parts center business.

Year Ended December 31, 2001 Compared to Year Ended December 31, 2000

        Operating Revenues:    On a consolidated basis, operating revenues were $2,249.3 million for the year ended December 31, 2001, which represents a $129.4 million, or 5.4% decrease, compared to $2,378.7 million for the year ended December 31, 2000. During the year ended December 31, 2001, we believe we continued to experience the effects of a general economic slowdown, particularly following the events of September 11, 2001. Despite these conditions, the decrease in our operating revenues was limited to 5.4%—with our Relocation Solutions—North America operations the most impacted, with a decrease in operating revenues of $139.7 million or 7.8%. Household goods shipments fell 14.0% and specialized transportation shipments fell over 5% in the year ended December 31, 2001. This was offset by $14.3 million or 3.8% of gains in Relocation Solutions—Europe & Asia Pacific, and $8.4 million or 11.1% of gains in our Network Services operations. Our Transportation Solutions business operating revenues decreased $12.4 million or 9.0%, predominantly, we believe, as a result of the general economic conditions, and the loss of a major customer in our parts center business.

        Gross margin:    Gross margin was $384.1 million for the year ended December 31, 2001, which represents a $1.0 million, or 0.3% decline, compared to $385.1 million for the year ended December 31, 2000, a result of lower operating revenues. The decrease in gross margin dollars by segment are a reflection of the associated changes in operating revenues offset to some extent by improvements in the gross margin rate. Gross margin as a percentage of operating revenues was 17.1% for the year ended December 31, 2001, which represents a 0.9 percentage point increase, compared to 16.2% for the year ended December 31, 2000. The change in gross margin as a percentage of operating revenues is explained later in our segment analysis.

        General and administrative expenses:    G&A expenses were $315.8 million for the year ended December 31, 2001, which represents a $4.1 million, or 1.3% decrease, compared to $319.9 million for the year ended December 31, 2000. This decrease of 1.3% in G&A expenses compares to a decline of 5.4% in our operating revenues. During 2000, we began major systems initiatives to enhance both its household moving services and transportation solutions business units. The moving services project related to the design and development of a web-enabled front-end designed to execute an e-commerce approach to sales and marketing in this business. The transportation solutions project related to the purchase and installation of i2 software, a sophisticated series of modules designed to optimize transportation management for both internal operations as well as to provide third party logistics services. Both projects required additional staffing and expense and resulted in unfavorable cost ratios on a year-over-year basis. Similarly, our G&A expenses as a percentage of operating revenues for the year ended December 31, 2001 was 14.0%, which represents an increase of 0.6 percentage points as compared to 13.4% for the year ended December 31, 2000. Our consolidated headcount was 7,795 as of December 31, 2001, which represents a 327 person or 4.4% increase compared to December 31, 2000. Operating revenues per employee at December 31, 2001 was $280,900, which represents a $45,507 or 13.9% decrease compared to December 31, 2000.

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        Restructuring charges.    We incurred $4.9 million of restructuring expense for the year ended December 31, 2001, of which $4.3 million relates to the exiting of the Transportation Solutions parts center business and headcount reductions and $0.6 million relates to the restructuring of our branch system in the U.K., which is essentially unchanged compared to $4.9 million for the year ended December 31, 2000, of which $2.7 million relates to the branch system and $2.2 million relates to restructuring charges due to headcount reductions associated with the reduction of our existing cost structure.

        Income from operations:    Income from operations was $52.5 million for the year ended December 31, 2001, which represents a $3.1 million, or 6.3% increase, compared to $49.4 million for the year ended December 31, 2000. While lower shipment volumes and resulting operating revenues reduced gross margin, the decrease was largely offset by an improvement of 0.9% in gross margin as a percentage of operating revenues. Net G&A expense reductions of $4.1 million, as discussed above, had a significant influence on the year-over year comparison.

        Interest:    Interest expense was $69.2 million for the year ended December 31, 2001, which represents a $4.2 million, or 5.7% decrease, compared to $73.4 million for the year ended December 31, 2000. This decrease was due primarily to lower interest rates. The decrease in interest expense was partially offset by $3.3 million of interest paid upon the completion of the Allied and Pickfords acquisition process.

        Income Taxes:    The income tax benefit was $0.1 million for the year ended December 31, 2001, based on a pre-tax loss of $16.7 million. For the year ended December 31, 2000, the income tax benefit was $1.8 million based on a pre-tax loss of $23.7 million.

        Net loss:    Net loss was $16.9 million, or $0.48 per share for the year ended December 31, 2001, which represents a $5.0 million or $0.20 per share decrease, compared to a net loss of $21.9 million or $0.68 per share for the year ended December 31, 2000. This improvement reflects the gains in operating income combined with the reduction in our interest expense over the prior year.

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Segment Analysis

        The following table sets forth information with respect to our segments, which provides a more complete understanding of the key drivers of our operating performance:

		Relocation Solutions
		Year Ended December 31, 2001
		North America			Europe & Asia Pacific			Network Services			Transportation Solutions			Corporate			Total SIRVA
		(Dollars in millions)
Operating revenues		$	1,652.1		$	387.1		$	84.2		$	125.9		$	—		$	2,249.3
Operating expenses:
	Purchased transportation expense		1,309.0			105.6			—			24.2			—			1,438.8
	Other direct expenses		161.6			140.7			61.5			62.6			—			426.4
Gross margin		$	181.5		$	140.8		$	22.7		$	39.1		$	—		$	384.1
Gross margin as a percentage of operating revenues			11.0	%		36.4	%		27.0	%		31.1	%		—			17.1	%
Income from operations		$	15.1		$	26.0		$	18.5		$	(6.3	)	$	(0.8	)	$	52.5

		Relocation Solutions
		Year Ended December 31, 2000
		North America			Europe & Asia Pacific			Network Services			Transportation Solutions			Corporate			Total SIRVA
		(Dollars in millions)
Operating revenues		$	1,791.8		$	372.8		$	75.8		$	138.3		$	—		$	2,378.7
Operating expenses:
	Purchased transportation expense		1,431.1			92.0			—			36.7			—			1,559.8
	Other direct expenses		175.0			142.3			54.2			62.3			—			433.8
Gross margin		$	185.7		$	138.5		$	21.6		$	39.3		$	—		$	385.1
Gross margin as a percentage of operating revenues			10.4	%		37.2	%		28.5	%		28.4	%		—			16.2	%
Income from operations		$	8.1		$	23.7		$	17.4		$	0.3		$	(0.1	)	$	49.4
Key Performance Indicators, 2001 vs. 2000:
Percentage change in operating revenues			(7.8	)%		3.8	%		11.1	%		(9.0	)%		—			5.4	%
Percentage point change in gross margin as a percentage of operating revenues			0.6			(0.8	)		(1.5	)		2.7			—			0.9

Relocation Solutions—North America

        Operating revenues were $1,652.1 million for the year ended December 31, 2001, which represents a $139.7 million, or 7.8% decrease, compared to $1,791.8 million for the year ended December 31, 2000.

        The decline in operating revenues relates to lower domestic and international home moves as well as fewer specialized transportation shipments resulting from the continuing effects of the general economic slowdown, particularly following the events of September 11, 2001, and the downturn in the technology and telecommunication sectors. Household goods shipments decreased by 14.0% and specialized transportation shipments decreased by 4.8% for the year ended December 31, 2001 compared to the year ended December 31, 2000.

        Gross margin for the year ended December 31, 2001 was $181.5 million, which represents a $4.2 million or 2.3% decline compared to $185.7 million for the year ended December 31, 2000. This decline was the result of lower operating revenues, partially offset by an improvement in gross margin as a percentage of operating revenues. Gross margin as a percentage of operating revenues was 11.0% for the year ended December 31, 2001, which represents a 0.6 percentage point increase, compared to 10.4% for the year ended December 31, 2000. The improvement in gross margin as a percentage of operating revenues was a result of operating and service delivery efficiencies, including lower cargo loss and damage related expenses, a reduction in our agent related moving expenses, and changes in the mix of our business during the year ended December 31, 2001.

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        Income from operations was $15.1 million for the year ended December 31, 2001, which represents a $7.0 million, or 86.4% increase, compared to $8.1 million for the year ended December 31, 2000. As a result of extensive integration of the U.S. operations of Allied and North American Van Lines following the acquisition of Allied, overall headcount was reduced, which, net of certain system costs, contributed to lower G&A expenses. This, combined with the improved gross margin as a percentage of operating revenues, contributed to the increase.

Relocation Solutions—Europe & Asia Pacific

        Operating revenues were $387.1 million for the year ended December 31, 2001, which represents a $14.3 million, or 3.8% increase, compared to $372.8 million for the year ended December 31, 2000.

        The increase in operating revenues was driven by underlying growth in our U.K. records management business as well as our domestic and international moving businesses in the U.K. and Australia. These increases were partially offset by an unfavorable currency impact of $19.8 million. For the year ended December 31, 2001, the average value of the Pound Sterling, the Australian dollar and the Euro were weaker as compared to the year ended December 31, 2000 by approximately 5%, 11% and 3%, respectively, when translated into the relatively stronger U.S. Dollar.

        Gross margin was $140.8 million for the year ended December 31, 2001, an increase of $2.3 million or 1.7% as compared to $138.5 million for the year ended December 31, 2000. The overall increase in gross margin dollars was a result of the growth in revenue, net of $6.8 million of unfavorable currency impact, somewhat offset by a decline in our gross margin rates. Gross margin as a percentage of operating revenues was 36.4% for the year ended December 31, 2001, which represents a 0.8 percentage point decrease, compared to 37.2% for the year ended December 31, 2000. This decrease reflects cost increases and operating inefficiencies in our residential and international moving business during the year ended December 31, 2001.

        Income from operations was $26.0 million for the year ended December 31, 2001, which represents a $2.3 million, or 9.7% increase, compared to $23.7 million for the year ended December 31, 2000, mirroring the gains in gross margin. In addition, the business increased headcount and resultant G&A expenses year-over-year, which also included a loss on certain foreign exchange contracts entered during the year. The year-over-year comparison is also affected by a $2.2 million branch restructuring charge incurred in 2000.

Network Services

        Operating revenues were $84.2 million for the year ended December 31, 2001, which represents an $8.4 million, or 11.1% increase, compared to $75.8 million for the year ended December 31, 2000. This increase was primarily driven by expanding the number of our agents and independent contractors covered by our programs since the merger of Allied and northAmerican.

        Gross margin was $22.7 million for the year ended December 31, 2001, which represents a $1.1 million, or 5.1% increase, compared to $21.6 million for the year ended December 31, 2000. The overall increase in gross margin dollars was a result of the growth in revenue, somewhat offset by a decline in our gross margin rates. Gross margin as a percentage of operating revenues was 27.0% for the year ended December 31, 2001, which represents a 1.5 percentage point decrease, compared to 28.5% for the year ended December 31, 2000. The decrease is due in part to an increased provision rate for loss reserve accruals in certain of our lines of insurance.

        Income from operations was $18.5 million for the year ended December 31, 2001, which represents a $1.1 million, or 6.3% increase, compared to $17.4 million for the year ended December 31, 2000. Our increases in operating revenues and gross margin in absolute terms carried through to income from operations for the year ended December 31, 2001.

Transportation Solutions

        Operating revenues were $125.9 million for the year ended December 31, 2001, which represents a $12.4 million, or 9.0% decrease, compared to $138.3 million for the year ended December 31, 2000.

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        Movements in operating revenues were primarily a result of reduced activities in our parts center business due to the loss of a major customer. This reduction was partially offset by new volume due to the addition of new solutions customers and increased program volume with existing solutions customers.

        Gross margin was $39.1 million for the year ended December 31, 2001, a decrease of $0.2 million or 0.5% as compared to $39.3 million for the year ended December 31, 2000. The overall decrease in gross margin dollars was a result of the decrease in operating revenues, partially offset by an improvement in our gross margin rate. Gross margin as a percentage of operating revenues was 31.1% for the year ended December 31, 2001, which represents a 2.7 percentage point increase, compared to 28.4% for the year ended December 31, 2000, following a mix shift from lower margin parts center programs to new inventory management programs.

        Loss from operations was $6.3 million for the year ended December 31, 2001, which represents a $6.6 million decrease compared to income of $0.3 million for the year ended December 31, 2000. In addition to the change in gross margin rate, we incurred higher G&A expense associated with incremental systems costs aimed at enhancing our solutions applications. Additionally, we incurred $3.3 million of restructuring expense year-over-year consisting of severance and employee benefit costs, lease and asset impairment costs related to the exiting of the parts center business.

Financial Condition

        The information provided below about our cash flows, debt, credit facilities, capital and operating lease obligations and future commitments is included here to facilitate a review of our liquidity.

Cash flows from operating activities.

        Net cash provided by operating activities was $30.4 million, $115.1 million and $67.2 million, for the years ended December 31, 2000, 2001 and 2002, respectively. For each of the years in the three-year period ended December 31, 2002, our operating cash flows have been favorably impacted by improvements in our net income which has increased from a loss of $21.9 million for the year ended December 31, 2000 to income of $20.8 million for the year ended December 31, 2002.

        The impact of these gains in net income was augmented by management of accounts receivable. Our daily sales outstanding in accounts receivable, or DSO, which is a key performance indicator tracked by our Treasury department, can be summarized as follows:

	Days Sales Outstanding in Accounts Receivable
	December 31,			September 30,
	2000	2001	2002	2002	2003
Trailing twelve months average	55	52	45	47	45
End of period	61	47	42	44	43

        In May 2002, we acquired CRS, which added a new cash flow dimension to our business. As part of our relocation product offering, we provide home equity advances to relocating corporate employees and sometimes purchase the employees' homes under buyout programs. In the U.K. and for traditional relocation in the U.S., the corporate customer guarantees us repayment of these amounts to the extent proceeds from the home sale are insufficient.

        These equity advances, purchased homes and mortgages are classified as current assets in our consolidated balance sheets, and movements in these assets are reflected in our cash flow from operations. The cash needed to finance these assets is largely provided by special-purpose facilities, movements in which are reflected in our cash flow from financing activities. In light of the corporate guarantees and the credit quality of our counterparties, we believe the risk associated with the advances, purchased homes and mortgages is low. For internal purposes, we treat the associated financing as a current liability, not as debt. This current liability moves in tandem with the corresponding current assets, with minimal resulting net effect on cash flow.

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        For internal management purposes, we use a measure of "Free Cash Flow". This measure deducts our capital expenditures and excludes the impact of movements in these relocation and mortgage assets from our cash flow provided by (used for) operating activities, as we believe that they are of a cash-neutral nature.

        Free Cash Flow is not a measure determined in accordance with generally accepted accounting principles. We believe however that our definition of Free Cash Flow is a relevant measure as it represents the amount of cash available to us for the repayment of our indebtedness, for strategic acquisitions to grow our business, or for other investing or financing activities. Free Cash Flow should not be considered as an alternative measure of cash flows from operating activities, and does not necessarily represent amounts available for discretionary expenditures. Free Cash Flow also may not be comparable to similar measures disclosed by other companies because Free Cash Flow is not uniformly defined.

        We reconcile Free Cash Flow to cash flow provided by operating activities as follows:

	Years ended December 31,									Nine months ended September 30,
	2000			2001			2002			2002			2003
	(Dollars in millions)
Cash flow provided by operating activities	$	30.4		$	115.1		$	67.3		$	25.6		$	22.4
Increases in mortgages held for resale		—			—			16.8			22.2			23.5
Changes in relocation properties held for resale		—			—			1.2			5.6			32.6
Capital expenditures		(55.4	)		(48.3	)		(33.5	)		(25.0	)		(17.4	)
Free cash flow	$	(25.0	)	$	66.8		$	51.8		$	28.4		$	61.1

        Since 2000, our Free Cash Flow has improved from a cash outflow of $25.0 million in 2000, to Free Cash Flow of $51.8 million in 2002. As with cash flows from operating activities, this is driven by improvements in our income, combined with improvements in our management of accounts receivable, particularly in 2001, when we reduced year-end DSO by 14 days, or 23.0%.

        In the nine months ended September 30, 2003 we had Free Cash Flow of $61.1 million compared to $28.4 million in the nine months ended September 30, 2002, an increase of $32.7 million. This increase was primarily driven by higher net income of $13.9 million and lower capital spending of $7.6 million. In addition, amortization of intangible assets acquired in 2002 was $2.2 million higher and working capital and other operating cash uses were $9.0 million lower in the 2003 nine month period versus the 2002 nine month period.

        We believe that cash generated from 2003 operations, together with amounts available under the revolving credit facility and any other available source of liquidity, will be adequate to permit us to meet our debt service obligations, capital expenditure program requirements, ongoing operating costs and working capital needs for at least the next twelve months.

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        Cash flows used for investing activities.    Cash used for investing activities totaled $54.4 million, $73.0 million and $137.5 million, in the years ended December 31, 2000, 2001, and 2002, respectively. For the nine months ended September 30, 2002 and 2003, net cash used for investing activities was $124.3 million and $65.8 million, respectively. The cash impact of our acquisitions can be summarized as follows:

	Years ended December 31,						Nine months ended September 30,
	2000		2001		2002		2002		2003
	(Dollars in millions)
Allied & Pickfords (Purchase Price Settlement)	$	—	$	17.4	$	—	$	—	$	—
NAIT		—		—		27.0		26.9		5.8
CRS		—		—		57.5		57.5		—
Rowan Simmons		—		—		14.3		14.3		—
Scanvan		—		—		—		—		23.2
Other		5.8		4.0		3.8		3.8		0.4
	$	5.8	$	21.4	$	102.6	$	102.5	$	29.4

        Our capital expenditures, which we use for computer equipment, software development and transportation and warehouse equipment, totaled $55.4 million, $48.3 million and $33.5 million in each of the years ended December 31, 2000, 2001 and 2002 respectively, and $25.0 million and $17.4 million in the nine months ended September 30, 2002 and 2003, respectively. The level of capital expenditures in the years ended December 31, 2000 and 2001 was driven by significant spending on information technology across our business, particularly in our Transportation Solutions segment. Capital expenditures for 2003 are expected to range between $25.0 million and $30.0 million. We will continue to pursue acquisitions around the world that we believe would further strengthen our global presence or would advance our strategic position in the markets that we serve.

Cash flows from financing activities.

        Net cash flows from financing activities provided $44.3 million of funding for the year ended December 31, 2000. We repaid $53.4 million of our financing obligations in the year ended December 31, 2001 and financing activities provided $82.1 million of funding for the year ended December 31, 2002. Cash flows from financing activities consist primarily of bank borrowing draw-downs and repayments and proceeds from the issuance of common stock.

        In 2000 we issued common stock in the amount of $29.4 million in connection with the acquisition of Moveline. In 2002, we acquired businesses for a total consideration of $102.6 million, which was financed through our revolving credit facility as well as the issuance of $66.3 million of common stock and $50.0 million in new bank debt.

        In each of the years ended December 31, 2000, 2001 and 2002 we made scheduled principal repayments on our long term debt of $6.8 million, $11.8 million and $26.9 million, respectively. In addition to these scheduled repayments, we reduced our revolving credit position by $37.4 million in 2001 following the significant improvement in our working capital requirements during that year, including a prepayment of $17.7 million required by our credit agreement.

        In the nine months ended September 30, 2002 and 2003, cash flows from financing activities provided $112.4 million and $57.3 million of funding, respectively. In each instance, the financing activities supported our strategic acquisition program, our capital expenditures and the increase in working capital in 2003 associated with our growth.

Liquidity and Capital Resources

        We broadly define liquidity as our ability to generate sufficient cash flow from operating activities to meet our obligations and commitments. In addition, liquidity includes the ability to obtain appropriate debt and equity financing and to convert into cash those assets that are no longer required to meet existing strategic and financial

59

objectives. Therefore, liquidity cannot be considered separately from capital resources that consist of current or potentially available funds for use in achieving long-range business objectives and meeting debt service commitments. Our principal capital resources consist of our $150.0 million revolving credit facility and our accounts receivable.

        Our short-term and long-term liquidity needs will arise primarily from:

•

interest expense, which was $61.2 million in 2002. Of this, $45.3 million was settled in cash, $7.5 million relates to non-cash charges and $8.4 million relates to our senior discount loan, which will be settled in cash on repayment thereof. We expect our interest expense to approximate $60.0 million in 2003;



•

principal repayments of debt and capital leases, which, without giving effect to this offering and the consummation of the refinancing, were $27.2 million in 2003, $26.0 million in 2004, $59.0 million in 2005, $174.0 million in 2006, $160.5 million in 2007 and $152.4 million thereafter. However, we expect to prepay a significant portion of this debt with the proceeds of this offering and the refinancing, and we will be required to make future principal payments under the new credit facility. See "Use of Proceeds" and "Description of Our Indebtedness";



•

operating lease payments, which were $58.9 million in 2002 and are scheduled to total $49.0 million in 2003, $39.2 million in 2004, $36.3 million in 2005, $27.0 million in 2006, $24.4 million in 2007 and $102.9 million thereafter;



•

unconditional purchase commitments which are scheduled to total $22.0 million in 2003, $20.0 million in 2004, $19.2 million in 2005, $19.2 million in 2006, $18.6 million in 2007 and $83.6 million thereafter;



•

capital expenditures, which were $33.5 million in 2002, and are expected to range between $25.0 million and $30.0 million in 2003;



•

cash tax payments, which were only $4.9 million in 2002 and are expected to approximate $11.5 million in 2003, due primarily to the utilization of accumulated net operating losses in the U.S. After 2003, net operating losses in the U.S. should be substantially utilized and cash tax payments will be expected to more closely approximate the provision for income taxes; and



•

working capital requirements as may be needed to support business growth.

        The seasonal nature of the moving business results in increased short-term working capital requirements in the summer months. This will result in an increase in receivables which are typically collected, and revolving credit borrowings which are typically repaid, by late fall.

        The following table provides a summary, as of December 31, 2002, without giving effect to this offering and the consummation of the refinancing, of our contractual obligations related to long-term debt, leases and other commercial commitments:

			Payments Due by Period
Contractual Obligations	Total		Less than 1 year		2-3 years		4-5 years		After 5 years
	(Dollars In Millions)
Long-Term Debt	$	580.1	$	22.4	$	78.6	$	328.9	$	150.2
Capital Lease Obligations		19.0		4.8		6.4		5.6		2.2
Operating Leases		278.8		49.0		75.5		51.4		102.9
Unconditional Purchase Obligations		182.6		22.0		39.2		37.8		83.6
Total Contractual Cash Obligations	$	1,060.5	$	98.2	$	199.7	$	423.7	$	338.9

        Of the $98.2 million due in 2003, $75.8 million had been paid by September 30, 2003.

        Our obligations with respect to our long-term debt shown above will be affected by the use of proceeds from this offering and the refinancing, as well as the new credit facility.

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        Debt Service.    Principal and interest payments under our senior credit facility and interest payments on the notes represent significant liquidity requirements for us. Our senior credit facility is comprised of note payable—Tranche A, note payable—Tranche B and a revolving credit facility. As of September 30, 2003, we had $752.5 million of indebtedness comprised of indebtedness for borrowed money and capital leases consisting of:

•

$150.0 million principal amount of our 13³/8% senior subordinated notes;



•

$313.3 million outstanding under our term loans (consisting of a note payable—Tranche A and a note payable—Tranche B amounting to $105.0 million and $208.3 million, respectively);



•

$82.0 million outstanding under our $150.0 million revolving credit facility;



•

$63.5 million outstanding under our senior discount loan;



•

$22.8 million of capital leases;



•

$103.5 million of short term debt, consisting of $63.2 million of our mortgage warehouse facility, $37.7 million of our relocation financing facilities and $2.6 million of foreign subsidiaries' operating lines of credit; and



•

$17.4 million of other debt.

        In connection with this offering and the refinancing, we have commenced a tender offer for all of our 13³/8% senior subordinated notes and intend to effect a refinancing of all amounts outstanding under our existing senior credit facility with a portion of the proceeds from a new senior credit facility. Consequently, we will continue to be required to devote a substantial amount of our cash flow to service this indebtedness. See "Description of Indebtedness" and "Use of Proceeds".

        As of September 30, 2003, on a pro forma basis, after giving effect to this offering and the refinancing, the Company would have had available $140.3 million under the $175.0 million revolving portion of the new senior credit facility to meet our future working capital and other business needs.

        We guarantee certain operating lines of credit maintained by wholly owned foreign subsidiaries. As of December 31, 2001, December 31, 2002 and September 30, 2003, the outstanding balance was $1.2 million, $1.1 million and $2.6 million, respectively.

        For a description of the terms of our principal indebtedness, see "Description of our Indebtedness".

Commitments and Contingencies

        On July 1, 2002, we entered into a ten-year purchase commitment with Covansys Corporation and Affiliated Computer Services, Inc. to provide selected outsourcing services for our domestic information systems infrastructure, including data center operations and telecommunications and certain application software development. Covansys Corporation is a related party, as 24.5% of its outstanding common stock is owned by Clayton, Dubilier & Rice Fund VI Limited Partnership. As of September 30, 2003, the remaining purchase commitment was $163.3 million.

Off Balance Sheet Arrangements

        During 2002, we sold a portion of our equipment notes receivable portfolio to an unaffiliated third party. The transaction, which qualified as a sale under Statement of Financial Accounting Standards No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities" resulted in cash proceeds of $1.2 million, which approximated the fair value of notes receivable sold. The equipment notes receivable are due from agents or owner-operators for trailers, tractors and straight trucks and are collateralized by those assets. Each note is generally for a term of five years, bearing interest at either a fixed or variable rate of prime plus 1.0%—3.0%. Principal and interest are payable monthly over the term of the agreement. Under the terms of the sales agreement, we are responsible for servicing, administering, and collecting these notes receivable on behalf of the unaffiliated third party. Servicing fees under the sales agreement are deemed adequate compensation to us for performing the

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servicing, accordingly no servicing asset or liability has been recognized in the accompanying financial statements. Under the terms of the transaction, the maximum recourse exposure to us was $0.4 million.

Related Party Transactions

        We are parties to a consulting agreement with Clayton, Dubilier & Rice, Inc. whereby Clayton, Dubilier & Rice, Inc. receives a management fee for financial advisory and management consulting services. For the years ended December 31, 2000, 2001 and 2002, such fees were $0.4 million, $1.4 million, and $1.4 million, respectively, and $1.0 million for the nine months ended September 30, 2003.

        North American Van Lines has guaranteed loans made by a third-party lender in aggregate principal amounts of $0.02 million, $0.8 million and $1.3 million as of December 31, 2001, December 31, 2002 and September 30, 2003, respectively, to various members of our management, including one of our executive officers, in connection with their investment in SIRVA. North American Van Lines would become liable for such amounts in the event that a member of management would fail to repay the principal and interest when due. These loans mature in May 2004 and bear interest at the prime rate plus 1.0%. These loans include one loan made by the third-party lender and guaranteed by North American Van Lines to one of our executive officers, Todd W. Schorr. Mr. Schorr borrowed $159,750 to purchase 47,550 shares of our common stock. As of September 30, 2003, Mr. Schorr owed $161,788 to the third-party lender. The loan to our executive officer was made prior to passage of the Sarbanes-Oxley Act. Subsequent to its passage, we adopted a policy prohibiting us or any of our subsidiaries from making loans to or guaranteeing loans of executive officers.

        See "Certain Relationships and Related Transactions."

Inflation

        We believe that inflation, currently, does not have a material effect on the results of our operations.

Retirement Plans

        The domestic defined pension plans were amended effective April 1, 2002 for the purpose of combining the plans into one benefit plan covering all domestic employees. This single pension plan was then frozen effective December 31, 2002, which triggered curtailment accounting treatment due to the elimination of benefits earned for future years of service. The curtailment amounts were recorded in the results of operations as an unusual item for the year ended December 31, 2002.

        The postretirement medical plan covering certain domestic employees was amended effective April 1, 2002 to include substantially all of our domestic employees. The amendment also eliminated after age 65 benefits previously associated with this plan. Effective December 31, 2002, the plan was amended to eliminate any subsidies to employees that have not reached 50 years of age with a minimum of ten years of service as of December 31, 2002. This amendment triggered curtailment accounting treatment. The curtailment amounts were recorded in the results of operations as an unusual item for the year ended December 31, 2002.

        The total amount of pension and retiree curtailment gain for the year ended December 31, 2002 was $7.4 million.

        Retirement plan expenses and obligations are dependent on assumptions used in calculating such amounts. These assumptions include discount rate, rate of compensation increases and expected return on plan assets. In accordance with U.S. GAAP, actual results that differ from the assumption are accumulated and amortized over future periods. While we believe that assumptions used are appropriate, differences in actual experience or changes in assumptions may affect our retirement plan obligations and future expense. In 2002, we maintained the expected return on plan assets at 9.0%. In developing our expected long-term rate of return assumption, we evaluated input from our independent financial advisor, including their review of our pension asset class ten-year weighted average returns for each of the last ten years. The average ten-year return by year is 12.3%. We anticipate that our investment managers will generate long-term returns of at least 9.0%. A reduction in the expected return on plan assets from 9.0% to 8.5% would increase pension expense by approximately $0.3 million. The discount rate range was lowered

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to 6.75% from 7.25%. The discount rate we utilize for determining pension obligations is based on a review of AA+ long-term bonds held based on actuarial indices. A reduction in the discount rate from 6.75% to 6.50% would increase pension expense by approximately $0.3 million. Pension expense in 2003 is expected to increase by approximately $0.5 million primarily due to amortization of differences between actual and expected returns on plan assets. During 2002, we recorded a minimum pension liability adjustment of $18.3 million, net of tax, to accumulated other comprehensive income (loss). If the equity markets continue recent trends, we could be required to record a charge to accumulated other comprehensive income (loss).

Recent Accounting Pronouncements

        In April 2002, the Financial Accounting Standards Board ("FASB") issued Statement No. 145, "Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections" ("SFAS 145"). The statement updates, clarifies and simplifies existing accounting pronouncements. The provisions of SFAS 145 related to rescission of Statement 4 shall be applied in fiscal years beginning after May 15, 2002. The provisions in paragraphs 8 and 9(c) of the statement related to Statement 13 shall be effective for transactions occurring after May 15, 2002. The adoption of SFAS 145 did not have a material effect on our operating results or financial condition.

        In June 2002, the FASB issued Statement No. 146, "Accounting for Costs Associated with Exit or Disposal Activities" ("SFAS 146"). The statement requires companies to recognize costs associated with exit or disposal activities when they are incurred rather than at the date of a commitment to an exit or disposal plan. This statement replaces previous accounting guidance provided by EITF (Emerging Issues Task Force) Issue No. 94-3. SFAS 146 is to be applied prospectively to exit or disposal activities initiated after December 31, 2002.

        In November 2002, the FASB issued Interpretation No. 45, "Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others" ("FIN 45"). The interpretation clarifies the requirements relating to a guarantor's accounting for, and disclosure of, the issuance of certain types of guarantees. The provisions for initial recognition and measurement of FIN 45 are to be applied on a prospective basis to guarantees issued on or modified after December 31, 2002. We have considered the recognition and measurement provisions of FIN 45 and its effect on the financial statements. The disclosure requirements are effective for fiscal years ending after December 15, 2002. Our guarantees are as follows:

•

We have guaranteed North American Van Lines' senior secured credit facilities.



•

We have guaranteed certain of our wholly owned foreign subsidiaries' operating lines of credit.



•

Interest rate swap agreements and foreign exchange instruments with banks that are associated with our senior credit facility are borrower obligations under our senior credit facility, hence such agreements and instruments are secured and guaranteed.



•

North American Van Lines has guaranteed loans made by a third-party lender in aggregate principal amounts of $1.3 million, $0.8 million and $0.02 million as of September 30, 2003, December 31, 2002 and December 31, 2001, respectively, to various members of our management, including one of our executive officers, in connection with their investment in SIRVA. North American Van Lines would become liable for such amounts in the event that a member of management would fail to repay the principal and interest when due. These loans mature in May 2004 and bear interest at the prime rate plus 1.0%. These loans include one loan made by the third-party lender and guaranteed by North American Van Lines to one of our executive officers, Todd W. Schorr. Mr. Schorr borrowed $159,750 to purchase 47,550 shares of our common stock. As of September 30, 2003, Mr. Schorr owed $161,788 to the third-party lender. The loan to our executive officer was made prior to passage of the Sarbanes-Oxley Act. Subsequent to its passage, we adopted a policy prohibiting us or any of our subsidiaries from making loans to or guaranteeing loans of executive officers.



•

Our subsidiary entities have guaranteed our senior subordinated notes issued in conjunction with the acquisition of the Allied and Pickfords businesses.

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        In December 2002, the FASB issued Statement No. 148, "Accounting for Stock-Based Compensation—Transition and Disclosure" ("SFAS 148"), an amendment of SFAS No. 123, "Accounting for Stock-Based Compensation" ("SFAS 123"). This statement amends SFAS 123 to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation and amends the disclosure requirements to require prominent disclosure in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. We adopted only the disclosure requirements of SFAS 148.

        In January 2003, the FASB issued Interpretation No. 46, "Consolidation of Variable Interest Entities" ("FIN 46"). FIN 46 addresses consolidation by business enterprises of variable interest entities. On October 8, 2003 the FASB deferred the effective date of FIN 46 for variable interest entities created before February 1, 2003 until the first reporting period after December 15, 2003. As of September 30, 2003, we had no variable interest entities.

        In April 2003, the FASB issued Statement No. 149, "Amendment of Statement 133 on Derivative Instruments and Hedging Activities" ("SFAS 149"). SFAS 149 amends and clarifies financial accounting and reporting for derivative instruments, including certain derivative instruments embedded in other contracts (collectively, referred to as derivatives) and for hedging activities under SFAS 133. This statement is effective for contracts entered into or modified after June 30, 2003, and for hedging relationships designated after June 30, 2003. We adopted SFAS 149 which did not have a material effect on our operating results or financial condition.

        In May 2003, the FASB issued Statement No. 150, "Accounting For Certain Financial Instruments With Characteristics of Both Liabilities and Equity" ("SFAS 150"). SFAS 150 establishes standards for how a company classifies and measures certain financial instruments with characteristics of both liabilities and equity. It requires that a company classify a financial instrument that is within its scope as a liability (or an asset in some circumstances). As of September 30, 2003 our redeemable junior preferred stock, issued in connection with the Allied Acquisition, is subject to SFAS 150. We issued 24,5000 shares of junior preferred stock, due in 2010, to an affiliate of Exel, plc, having an initial liquidation preference of $24,500. The dividend rate on the junior preferred stock is 12.4% compounded quarterly and is cumulative, although the payment of dividends is subject to the discretion of our Board of Directors, and our ability to pay dividends is subject to various debt agreements. Due to the beneficial owner of the junior preferred stock being a foreign entity, IRS regulations require withholding taxes to be paid with each quarterly dividend, even if the dividend is notional only. All withholding payments made by us reduce the amount we will ultimately pay to redeem this instrument.

        In certain circumstances, the junior preferred stock is exchangeable at our option for our subordinated exchange debentures. The junior preferred stock is required to be redeemed on the eleventh anniversary of its issue date, or upon the occurrence of certain other events. In addition, we have a right, subject to the terms of its debt agreements, to redeem the junior preferred stock at any time after the first anniversary of its issued date. As required by SFAS 150, we have reclassified $32.1 million of redeemable junior preferred stock to redeemable junior preferred obligation, a long-term liability representing the settlement amount as of September 30, 2003. Beginning July 1, 2003, we have recorded $1.0 million of interest expense, which previously would have been treated as accretion of junior preferred stock dividends. We intend to apply a portion of the net proceeds of this offering to redeem the junior preferred stock (see "Use of Proceeds"), and our redeemable common stock will be reclassified as equity.

Quantitative and Qualitative Disclosures About Market Risk

        We are exposed to various market risks, including changes in interest rates and foreign currency exchange rates.

        We are exposed to various interest rate risks that arise in the normal course of business. We finance our operations with borrowings comprised primarily of variable rate indebtedness. Significant increases in interest rates could adversely affect our operating margins, results of operations and our ability to service indebtedness. A 1% rate increase would increase our gross interest expense by $3.7 million over the next year. The interest rate swap instruments described below would reduce the annual impact of a 1% change by $1.8 million. An increase of 1% in

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interest rates payable on our variable rate indebtedness would increase our annual interest rate expense by approximately $1.9 million in the next year.

        We utilize interest rate agreements and foreign exchange contracts to manage interest rate and foreign currency exposures. The principal objective of such contracts is to minimize the risks and/or costs associated with financial and international operating activities. We do not utilize financial instruments for trading purposes. The counterparties to these contractual arrangements are financial institutions with which we also have other financial relationships. We are exposed to credit loss in the event of nonperformance by these counterparties, but we have no reason to anticipate non-performance by the other parties.

        We had four open interest rate swap agreements as of September 30, 2003. The intent of these agreements is to reduce interest rate risk by swapping an unknown variable interest rate for a fixed rate. These agreements qualify for hedge accounting treatment, therefore, market rate changes in the effective portion of these derivatives are reported in accumulated other comprehensive income. The following is a recap of each agreement.

Notional amount	$60.0 million	$60.0 million	$40.0 million	$20.0 million
Fixed rate paid	3.10%	2.89%	2.43%	2.44%
Variable rate received	1 Month LIBOR	1 month LIBOR	1 month LIBOR	1 month LIBOR
Effective date	January 2003	March 2003	April 2003	April 2003
Expiration date	January 2007	March 2006	April 2005	April 2005

        Assets, liabilities and commitments that are to be settled in cash and are denominated in foreign currencies for transaction purposes are sensitive to changes in currency exchange rates. All material trade receivable balances are denominated in the host currency of the local operation. For the nine months ended September 30, 2003 and 2002, we recognized a currency loss of $0.1 million and an insignificant gain, respectively, for transactional related items.

        From time to time, we utilize foreign currency forward contracts in the regular course of business to manage our exposure against foreign currency fluctuations. The forward contracts establish the exchange rates at which we will purchase or sell the contracted amount of U.S. dollars for specified foreign currencies at a future date. We utilize forward contracts which are short-term in duration (less than one year). The major currency exposures hedged by us are the Australian Dollar, the British pound and the Euro. The contract amounts of foreign currency forwards at September 30, 2003 and 2002 were $36.5 million and $6.6 million, respectively. A hypothetical 10% adverse movement in foreign exchange rates applied to our foreign currency exchange rate sensitive instruments held as of September 30, 2003 would result in a hypothetical loss of approximately $1.8 million. Because these derivatives do not qualify for hedge accounting treatment, changes in fair value relating to these derivatives are recognized in current period earnings. For the nine months ended September 30, 2003 and 2002 we recognized losses of $1.4 million and $0.2 million, respectively, resulting from changes in the fair value of foreign currency derivatives.

        We hold various convertible bonds in the investment portfolio of our insurance operations. The value of the conversion feature is bifurcated from the value of the underlying bond. Changes in fair value are recorded in current period earnings. For the nine months ended September 30, 2003 and 2002, we recognized a gain of $0.2 million and loss of $0.3 million, respectively. The insurance investment portfolio also included marketable debt and equity securities which are classified as available-for-sale and are recorded at fair value within other assets on our balance sheet. Unrealized holding gains and losses, net of the related tax effect, on available- for-sale securities are excluded from earnings and are reported as a separate component of other comprehensive income until realized.

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THE RELOCATION INDUSTRY

        The global relocation industry provides a variety of services that support the relocation of households for:

•

Corporations that pay for the relocation of their employees;



•

Governments that pay for the relocation of their military and civilian personnel; and



•

Individual households that pay for their own relocation.

        The size, scope and type of relocation services offered to these distinct market segments differs by country and by customer, but they generally include the services listed in the table below:

	Market Segment
Relocation Service
	Corporate	Military	Government	Consumer
Home Purchase / Sale	X		X
Realtor / Realtor Management	X		X	X
Moving Services / Move Management	X	X	X	X
Mortgage	X		X	X
Destination Services	X		X
Visa / Expatriate Services	X
Program Administration	X	X	X

        While there is no comprehensive study of the total spending on relocation services, according to the Employee Relocation Council, U.S. corporations relocate over 1.0 million employees on an annual basis, both domestically and internationally and the U.S. military relocates 800,000 personnel annually. These numbers are in addition to the millions of individual households that move each year. We estimate the global addressable market for outsourced relocation service providers and household goods moving companies to be at least $50 billion.

Corporate

        A corporate sponsored relocation typically includes a variety of relocation services and may include some or all of the following: the movement of household goods; assistance with the sale of the employee's home; the purchase of the employee's home; temporary living assistance; assistance with the purchase of a new home, including mortgage and title services; destination services and tracking and processing of all related claims and expenses. For employees relocating outside their home country, many companies cover the costs of tax and visa planning, assistance with home finding, and other related services. As illustrated by the following chart, a corporation's total spending on these services may be up to $60,000 for a domestic relocation within the U.S., and significantly in excess of that for an international relocation.

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Illustrative Breakdown of Corporate Spending on a $60,000 Domestic Relocation

        We believe that the global relocation services market is being driven by the growing size, globalization and complexity of corporations around the world, and the trend toward the outsourcing of non-core administrative activities, including human resources activities. International Data Corporation projects U.S. human resources spending on outside services will grow at a 12.5% compound annual growth rate over the next five years. Because the cost of relocating employees is a component of human resources expenditures, we believe that we will benefit from this growth. According to the Global 500 List for the Year 2002 published by Fortune Magazine, Global 500 corporations employed more than 47 million people in 2001, and the median number of employees for a Global 500 corporation was approximately 63,000, in multiple locations and countries. An employee base of this magnitude presents logistical complexities and a need for efficient relocation services. Many corporations believe relocation service providers offer a lower cost, higher quality solution to both corporations and their transferring employees than can be provided by in-house alternatives.

Military/Government

        The range of services offered to the military includes the movement of a transferee's household goods and administration of transferee relocation programs, which is referred to as program administration. For the government sector, the industry offers a similar suite of services as are offered to the corporate market. We estimate that the average cost for a military relocation is $10,000 and the average cost for a government service agency relocation is $40,000. The military and government businesses are driven primarily by changes in government and military activity, rather than changes in economic conditions.

Consumer

        According to the latest study of the National Association of Realtors, 17 million households relocate each year in the U.S. In most cases, a household whose relocation is not being sponsored by an employer or the government will purchase needed relocation services from a variety of different providers including independent real estate agents, mortgage service companies and professional moving services companies. Of these 17 million household relocations, we estimate that at least 25% or 4.3 million use a moving services company for the movement of their household goods.

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Relocations Services Competition

        A variety of industry competitors have emerged to serve the relocation services market. The services these firms provide have evolved from services around their various core competencies to an attempt at providing a complete relocation service offering. Companies that compete in the marketplace include real estate brokers, financial services firms that provide home mortgages, accounting firms that entered the relocation services business through providing tax and accounting services to transferring employees, moving companies and a number of smaller industry competitors who have created businesses specifically to address the corporate relocation market.

Moving and Storage Industry

        The moving and storage industry is a significant industry within the broader relocation services industry. Typical services provided to a household include: packing and unpacking; loading and unloading; transporting; and storage of goods, if necessary. The main participants in the North American professional residential moving services industry are:

•

a number of large national moving companies operating through agency networks;



•

several hundred independent carriers, which are companies that provide full moving services without affiliation with one of the large national moving companies;



•

several thousand agents, which are independently owned companies affiliated with one of the large national moving companies; and



•

tens of thousands of owner/operators, which are independent contractors that are retained by large moving companies, independent carriers or agents and who own and drive tractors and are responsible for transporting, loading and unloading shipments.

        The moving and storage industry in Europe and the Asia Pacific regions is fragmented, with a few large suppliers providing the full range of moving and relocation services, and a considerable number of smaller, low-cost operators.

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BUSINESS

General

        We are a world leader in the global relocation industry, providing our solutions to a well-established and diverse customer base. We handle more than 385,000 relocations per year, including transferring corporate and government employees and moving individual consumers. We operate in 43 countries under well-recognized brand names including Allied®, northAmerican®, Global® and SIRVA Relocation in North America, Pickfords® in the U.K., Maison Huet® in France, Scanvan® in Scandinavia and Allied Pickfords in Asia/Pacific. We are redefining the global relocation market by combining our relocation service offerings with our proprietary moving services network on a global basis. This unique combination is driving our growth by addressing our corporate and government customers' needs for a comprehensive service offering with global reach from a single supplier. In addition, we offer a variety of services targeted at meeting the needs of truck drivers, fleet owners and agents, both inside and outside our proprietary agent network

        Our service offerings include the following:

Global Relocation Solutions		Network Services
Home Sale	High-Value Products Moving	Insurance
Household Goods Moving	Storage	Vehicle Repair and Maintenance
Home Purchase	Office Moving	Group Purchasing Organization
Mortgage Services	Records Management	Fuel and Tire Discount Programs
Expatriate Services	Visa and Work Permits
	Expense Management

        The market for relocation and related services is large and highly fragmented. We estimate that the worldwide aggregate annual value of these services provided by in-house and third-party providers is more than $50 billion. We are a leader in the outsourced portion of this market. The outsourcing of relocation services has been increasing, driven by the administrative and cost efficiencies and superior service levels offered by outside providers. We believe that, over time, third party providers will continue to increase their share of corporate relocation spending.

        Our financial results reflect our ability to increase profitability even in a difficult economic environment. For the twelve months ended September 30, 2003, we had operating revenues and operating income of $2.3 billion and $114.1 million, respectively. These represent increases of 9% and 37% over our operating revenues and income from operations for the twelve month period ended September 30, 2002, resulting from a combination of internally generated and acquisition growth.

        Our business operates in four segments: Relocation Solutions—North America, Relocation Solutions—Europe & Asia Pacific, Network Services and Transportation Solutions. We sometimes refer to our Relocation Solutions—North America and Relocation Solutions—Europe & Asia Pacific Segments together as Global Relocation Solutions.

Income from Operations by Segment for the twelve months ended September 30, 2003	Income from Operations by Geography for the twelve months ended September 30, 2003

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Global Relocation Solutions

        We offer a comprehensive suite of relocation solutions to our more than 2,500 corporate and government customers around the world, providing a wide variety of services including the sale of employees' homes, movement of their household goods, purchase of their new homes and provision of destination services. In addition, we provide our corporate customers with moving services for products that require special handling and constant monitoring due to their high value. Our relocation solutions services are provided by a team of over 6,000 employees around the world and a network of agents and other service providers.

        While most of the corporate relocations originate from the U.S. and the U.K., our relocation services are provided through our operating centers throughout the world to meet the global relocation needs of our corporate customers: five in the U.S., four in the UK, two in Australia and one in Hong Kong. In each of these locations, our customer service and account management personnel interact with our corporate clients and their transferring employees on a regular basis.

        Our moving services for our corporate, military/government and consumer markets are provided through our worldwide proprietary agent network. Our corporate, military/government and consumer businesses around the world completed approximately 155,000, 46,000 and 186,000 relocations in 2002, respectively.

        In North America, we provide our moving services through our proprietary branded network of 780 agents who own the trucks and trailers used in moves and are responsible for packing, hauling and storage and distribution of household goods. We act as a network manager for our agents, providing, among other things, brand management, load optimization, billing, collection and claims handling. Outside of North America, we provide moving services through a network of company-owned and agent-owned locations in Europe and the Asia Pacific region.

Relocation Services

        We meet the needs of transferees with a full suite of customer-focused, innovative service offerings coupled with a proprietary global fulfillment network. These services include:

        Home Sale.    On behalf of our corporate customers, we will value and arrange for the sale of a transferring employee's home. In some cases, we will provide an advance on the equity in the home enabling the employee to purchase a new home before the existing one is sold. In addition, under some programs if an employee's house is not sold within a specified timeframe, we purchase the existing house and continue to market the property until it is sold.

        Traditionally, relocation services companies have offered this service on a cost-plus basis. In exchange for a fee plus a margin on costs incurred, they agree to purchase and resell an employee's home. Any loss on the home sale and all holding costs incurred while the house is "in inventory," including a cost of funds on the equity advance and the mortgage servicing costs, are borne by the corporate customer.

        While we offer this traditional pricing model to customers, we also offer a differentiated product providing all these services to our U.S. corporate customers for a fixed fee, set as a percentage of the transferee's home value. In these cases, we take responsibility for all costs in the home sale process and under some programs agree to purchase the home for our own account if it is not sold within a time frame agreed upon with the corporate customer. If we take a home into inventory, which, in our experience, has occured in less than 10% of cases, we either continue to service the mortgage until the home is sold or, in the case of government service agencies and some corporate clients, we immediately pay off the mortgage. We have a comprehensive and sophisticated process for minimizing our risk and cost of running the fixed fee offering and have experienced minimal losses over the history of the program. We believe this model better aligns our interests with those of our customer, as it is in our mutual interests to avoid holding houses in inventory for long periods of time and incurring losses on resale. Our fixed-fee product has grown at a significant rate, and now represents nearly 50% of our corporate relocations.

        Home Purchase.    Through our network of affiliated independent real estate brokers, we assist corporate transferees in locating a new home at the destination location. We provide this service at no cost to the corporation,

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but receive a referral fee from the real estate broker for any home purchase. We actively monitor and rate our real estate brokers to ensure cost-effective high-quality service.

        Mortgage Origination.    We provide mortgage services to our customers' transferees, underwriting the mortgage for a transferee's home purchase. Before a mortgage is underwritten, we obtain the agreement of one of various third-party financial institutions to purchase the mortgage from us. There is a processing lag of 20–30 days between the time we write the mortgages and complete the sale. During this time, the mortgages are carried as current assets and are financed through our mortgage warehouse facility. For the twelve months ended September 30, 2003, we closed approximately $827.0 million of mortgages.

        Destination Services.    We assist corporations in making relocations more successful for the transferee by providing a range of services that reduces the inconvenience of assignments to transferees and facilitates their integration into the new locale. These services include city orientation, school selection, visa and immigration management, language and cultural training and other services. In most cases, we contract with third party providers to deliver these services and receive a referral fee.

        Relocation Program Administration.    We offer our corporate customers complete outsourcing of the administration of employee relocation programs, providing expense tracking, compliance and reporting, tax reporting and payroll interface services. We can aggregate data across all of a corporation's relocations, providing clients a valuable overview of their relocation programs and expenses and suggest ways to cut costs and improve services.

        Move Management.    We provide move management services to corporate transferees, coordinating the packing, storage and moving of a transferee's household goods, and providing complaint handling and claims assistance. We either provide these services through our own fulfillment network, described below under "—Household Goods Moving Services," or, at a corporate customer's election, through a non-SIRVA moving company.

        We provide all of these relocation services through operating centers located around the world: five in the U.S. (Chicago, Denver, Connecticut, Minneapolis and Cleveland), four in the U.K., two in Australia and one in Hong Kong. We have a staff of over 350 key account managers and relocation managers who deal with our clients and their transferees continuously. Speaking more than 30 languages and representing many nationalities, this staff coordinates our extended network of service providers, including moving services companies, real estate brokers, appraisers and destination service providers.

        Most corporate clients prefer a streamlined communication process between ourselves and their human resource managers who handle employee relocations. We have account managers who provide this single point of contact with our clients. For individual transferring employees, we provide the full range of relocation services through a lead relocation counselor who draws on other specialists as needed during the relocation process.

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Household Goods Moving Services

        In 2002, we handled approximately 155,000, 46,000 and 186,000 corporate, military/government and consumer relocations, respectively. Through our Allied, North American and Global branded networks in the U.S.; Pickfords, Scanvan and Maison Huet in Europe and Allied Pickfords in Asia/Pacific, we provide domestic and international household goods, packing, storage and moving services. We have a leadership position in the moving services industry around the world. Our Allied® and northAmerican® trademarks are considered two of the most valuable brand names in the moving services industry and are consistently ranked by the Gallup polls among the top moving companies in terms of brand recognition and customer satisfaction.

        In North America, our household goods relocation services are primarily provided through our network of branded agents. Agents are independently owned local moving companies that provide customers with the local packing, warehousing and the majority of the hauling required to support household moves anywhere in the world. Most of the equipment used in our moving operations is owned by our network of agents and their drivers. We, in turn, provide our agents with a broad range of services including identification and coordination of hauling capacity, coordination of shipments, optimization of capacity, sophisticated transportation and logistics technology, brand management and a variety of other marketing services. Our agents generally conduct intrastate moves under their own names and licenses, except in certain states such as Texas and California where we hold intrastate licenses because of their relative size or the intrastate activities conducted by our specialized transportation business. We are therefore not a party to most intrastate transactions and do not recognize operating revenues and associated costs in connection with such transactions. In contrast, we hold licensing authority for all interstate moves and have entered into contracts with local agents with respect to their interstate moves and recognize revenues accordingly.

        In Europe and Asia, we provide household goods relocation services, office and industrial moving, records management and storage through a combination of our company-owned locations, our proprietary agent network and our network of affiliated preferred providers. We own a majority of the fulfillment assets in the U.K., France, Benelux, Australia and New Zealand and utilize an agent network in the rest of Continental Europe, Scandinavia and Asia.

        Agent Network.    The agents own most of the assets associated with operating their local moving and storage business (warehouse(s), tractors, trailers and associated other packing and moving equipment) and in many instances have contracts with owner/operators or have hired employee drivers to bring hauling capacity to the network.

        We have established, long-term relationships with our branded agent network, which on an individual basis have often extended to a multi-generation affiliation with us. The relationship with the agent network is governed by an agency contract which defines the terms and conditions of their exclusive representation of us on all interstate

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household goods shipments, as well as the compensation structure for services provided. While we enter into certain short-term contracts, we will often enter into long-term contracts, which typically extend from 3 to 12 years in length, with selected agents. In certain situations, we may make up-front payments to the agent as an incentive for entering into a long-term arrangement. In these cases, the agreement will include certain performance criteria, which if not met or if the agent terminates the agreement prior to its expiration date, which will result in a pro rata portion of the upfront payment becoming repayable to us. Our long-term contracts provide security to both parties, and also ensures us long-term representation and operating revenues in key markets. We have long-term contracts in place with agents who represent approximately 40% of the 2002 operating revenues for our moving services business in the U.S. As a result of these arrangements, we have historically experienced relatively low agent turnover. No one agent accounted for more than 7% of our operating revenues for our moving services business in the U.S. in 2002.

        Owner/Operators.    Owner/operators are independent contractors who work with us and agents and provide household goods and specialty transportation fulfillment services. They own the trucks and provide the labor needed to service customer moves. Across our entire network, there are approximately 2,257 owner/operators contracted, almost exclusively by agents, in household goods relocation, and 951 owner/operators contracted by us primarily in specialized transportation.

Customers

        We serve a diverse range of customers around the world, including small, medium and large corporations, military and government agencies and individual consumers. This diverse client base lowers our exposure to downturns or volatility in any one industry or region. The following table of our 2002 relocations illustrates the global breadth and diversity of our relocation business:

		North America	Europe	Asia Pacific	Total
Corporate		94,000	25,000	36,000	155,000
Military/Government		41,000	2,000	3,000	46,000
Consumer		128,000	39,000	19,000	186,000
	Total	263,000	66,000	58,000	387,000

        Corporate Customers.    We have more than 2,500 corporate customers, ranging from small businesses to large multinationals. Our corporate business represented 40% of our global relocations and approximately 50% of our global relocation operating revenues for 2002. Many of our contracts with corporate customers are terminable by the customer on short notice, and generally do not specify a minimum transaction volume. We have added 191 new corporate customers or customer contracts during the nine months ended September 30, 2003. The contracts are subject to terms and conditions similar to those of our existing contracts with corporate customers.

        Our customers cut across a variety of industries, including consumer packaged goods, automotive, manufacturing, business and financial services, retail, technology and pharmaceuticals. They are based throughout the U.S., Europe and Asia Pacific.

        Military/Government Agencies.    We provide household goods moving services to State and Federal government agencies in the U.S., including the U.S. Department of Agriculture, the Drug Enforcement Administration and the Federal Bureau of Investigation, all branches of the U.S. military and government agencies of other countries around the world. This has traditionally represented a stable source of demand for our services, less subject to economic cycles than the corporate markets. We have historically served the U.S. military with moving services. We have recently been added to a select group of providers who are authorized to supply the U.S. Government service agencies with outsourced relocation services and are in the early stages of evaluating how to address this opportunity. The military and government agencies represented 13% of our global relocations and approximately 10% of our global relocation operating revenues for 2002.

        Consumer Market.    We provide domestic and international household goods moving services to consumers around the world. In 2002, we provided moving services for 128,000 households in North America, 39,000

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households in Europe and 19,000 households in the Asia Pacific region. The individual household market has traditionally been stable in terms of both volume and price. Selection of a moving company is generally driven by brand, quality, price and capacity. We believe we are well-positioned to expand our consumer business because of our ability to compete effectively on these key factors. Our consumer business represented 47% of our global relocations and approximately 40% of our global relocation operating revenues for 2002.

        We have recently begun to offer consumers a range of relocation services via employee programs through corporate customers. These services currently include mortgage brokerage and moving services. We intend to expand this effort across a greater number of services and corporate clients.

Sales and Marketing

        We believe we have the largest sales and marketing group in the relocation industry with a 60 member corporate sales and marketing team and a 400-person strong network of agent sales personnel. In addition, we have a dedicated sales and marketing team for the military/government market and we address the consumer market through multiple channels, including the Yellow Pages, multiple websites and our agent sales force.

        While we expect to grow our business in each market, we believe our largest opportunity for continued growth is in the corporate market. Because of our long-standing moving services relationships with many of our corporate clients, we have a track record of delivery that enables us to offer related relocation services to many of them. This combined offering of relocation and moving services can often reduce their costs, while maintaining or improving the quality of service, and simplifying their administrative effort.

        The opportunity for growth for our corporate business is large because, among our 2,500 corporate customers, we currently provide this combination of relocation and moving services to only 106. We believe that we have the opportunity, on average, to more than triple our revenue from a customer by converting it from one utilizing only our moving services to one using our combined offering of moving and relocation services. We also have a significant opportunity to sell this combination of services to new corporate clients with whom we have no business today. Through an aligned marketing and sales effort and by supporting and coordinating the selling effort of the more than 400 agent network salespeople, we are able to successfully offer this comprehensive suite of services to our customers.

        As the market recognizes our growing presence and broad capabilities, our opportunities to compete for business from customers around the world have increased. In the nine months ending September 30, 2003, we have won over 191 contracts from new and existing corporate clients. These contracts helped drive our growth in the first nine months of 2003 and are expected to contribute to growth in 2004.

        In our corporate market, our sales and marketing groups work in conjunction with our service delivery personnel to accomplish four broad objectives:

•

To provide greater satisfaction to our current customers by exceeding their expectations for service;



•

To retain existing customers by delivering an increasing level of satisfaction;



•

To develop innovative new products and services; and



•

To continually strengthen and support our branded network of agents and their salespeople.

Competition

        The relocation services business is highly competitive, and includes a handful of major companies that provide a full suite of relocation services, including SIRVA, Cendant, Prudential, Weichert/RRI and GMAC. The remainder of the relocation business is highly fragmented, with a variety of companies offering individual services, including real estate brokers, moving companies, accounting firms, mortgage firms, destination service providers and business process outsourcing firms.

        The basis for competing successfully in this market rests on a company's ability to meet the needs of corporate customers, including high quality, low cost, low risk, simplified administration and effective knowledge management. The majority of our major competitors approach the market based on their strength in real estate. Like us, other competitors such as Crown, Interdean and Unigroup approach the market based on their strength in moving services.

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        The moving services business is highly competitive and fragmented. Within North America, there are a number of large moving companies providing national services. The remainder of the industry remains extremely fragmented with many small private players that have strong positions in local markets. We compete primarily with national moving companies, independent movers and self-storage and self-haul service providers. Some of our chief competitors in the moving services business are Unigroup (United and Mayflower), Atlas and Bekins. Quality, customer service, price and capacity are key factors in the mover selection process.

        Within Europe and the Asia Pacific region, the industry is also extremely fragmented among regional, national and local companies. Many of these companies may specialize in segments of the moving market such as international, domestic or office moving. Our chief competitors in the Europe and Asia Pacific region include Crown Relocations, Santa Fe, Britannia, TransEuro, Amertrans, Sterling, Michael Gerson, White & Company and Interdean in corporate and consumer moving, and Harrow Green, Edes and Business Moves in office moving and Iron Mountain and Recall in records management.

Specialized Transportation Industry

        The specialized transportation industry services corporate customers that have products that are typically of high value, are difficult to package and transport and have special handling and/or delivery requirements. These requirements often dictate specialized equipment and skilled crews to handle, deliver and occasionally install the product. These services have often been used by the high tech, telecommunications, medical equipment, fitness equipment and signage industries.

        SIRVA Specialized Transportation:    Our specialized transportation services grew out of our moving business. We have traditionally been focused largely on the computer, electronics and medical equipment sectors, and have developed sophisticated technology solutions that allow us to identify and track this high value freight at the serialized level. Our fleet of trailers are specifically equipped to handle the loading, unloading and hauling of sensitive, technology-based products. We, along with our agents, also operate a network of distribution and warehouse locations that are configured to store and track a client's inventory. We can combine our physical distribution capabilities with our network of locations to provide our clients with a complete package of transportation capabilities. The specialized product delivery process begins when corporate accounts contact local representatives or us to establish shipment requirements. We then coordinate the availability of our specially equipped trailers with the availability of owner/operators who provide the tractor and perform the hauling and handling services.

        We, and our agents, have established numerous ongoing relationships with key corporate customer, requiring high value, specialized services, including many Fortune 500 companies. Our customer base is located primarily in the United States.

        Our specialized transportation services generally utilize the same proprietary agent network as our moving services business for a majority of the sales and a portion of the transportation, warehousing and delivery services we provide for our customers. The contract with our agent defines the compensation structure for services provided, which typically pays a percentage of operating revenue to agents involved in the process.

Network Services

        The network services market comprises a range of services offered to moving and storage agents, independent owner/operators and small fleet operators to assist them in the daily operation of their business. Services offered include insurance products, fleet maintenance programs, equipment and fuel purchase packages, breakdown and road services as well as technology, legal and tax services.

        We offer a variety of network services targeted at meeting the needs of truck drivers, fleet owners and agents, both inside and outside our network. We developed these services using the knowledge of the needs of truck drivers, fleet owners and agents that we have accumulated from managing our proprietary agent network, operating our own fleets and drivers and from our frequent interactions with independent owner-operators.

        Our services include insurance coverage such as vehicle liability, occupational accident, physical damage, and inland marine insurance coverage, as well as truck maintenance and repair services and group purchasing. In

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addition, we offer a suite of services including fuel, cell phone, tire services, legal assistance and retirement programs to the members of the National Association of Independent Truckers, an association of independent contract truck drivers. This association currently has approximately 24,800 owner-operator members, and we believe there is substantial opportunity for continued growth.

Insurance Services

Transguard

        Transguard, the largest component of the Network Services segment, is a leading provider of insurance services to moving agents, small-fleet owners and owner/operators.

Customer Category	Estimated U.S. Industry Size	Number of SIRVA Customers	% of Total Insurance Revenue for the nine months ended September 30, 2003
Agents	in excess of 16,000	442	32%
Small-Fleet Owners	450,000 trucks	1,613 representing 2,528 trucks	13%
Independent Owner/Operators	168,000	24,800	55%

        Due to the historical relationship with our moving services companies, Transguard provides insurance services to a significant portion of our U.S. fulfillment network. We have used the market position and knowledge acquired from serving our network to extend our offering to non-affiliated agents, drivers and small fleet owners. The acquisition of the National Association of Independent Truckers in April of 2002 opened up a new customer channel of independent owner/operators. Transguard sells insurance services through our moving services business and to the members of NAIT, which offer low-cost channels for acquiring new customers. We also sell our insurance services through a network of third-party insurance brokers.

        Transguard's range of insurance offerings are tailored to the needs of our customer segments, including:

Premium In Force at December 31, 2002

        As a result of our focus on a targeted customer base and industry knowledge acquired through our other operations, we can design product offerings that are tailored for the needs of our target market. We believe that competitors without moving operations lack this knowledge and specific market focus, and offer more generic solutions that are not as attractive to our customers. We are cautious in choosing which customers to insure and what kinds of insurance to write. The insurance products listed in the chart above generally are short-tail in nature

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and have quantifiable exposures. We do not write significant amounts of longer-tail, more open-ended liability insurance products, such as workers' compensation. Our measured approach is reflected in our historical operating performance; we have consistently earned a profit on our underwriting activity, which represents approximately 79% of our income from operations in our insurance business; investment income represents the balance. Our combined loss and expense ratio was 80% at the end of 2002, has been below 100% for the past ten years and has declined each year since 1998. The combined loss and expense ratio is a key measure of underwriting profitability traditionally used in the property and casualty business. When the combined ratio is under 100%, underwriting results are generally considered profitable.

Insurance and Claims Reserves

        Transguard establishes reserves that are estimates of amounts needed to pay claims and related expenses in the future for insured events that have already occurred. The process of estimating reserves involves a considerable degree of judgment by management and, as of any given date, is inherently uncertain. Reserves include provisions for reported claims, or case estimates, provisions for incurred-but-not-reported claims and legal and administrative costs to settle claims. Reserve estimates are based upon past claims experience, knowledge of claims staff regarding the nature and potential cost of each claim and trends and estimates of future claims trends. These claims costs are influenced by many factors that change over time, such as changed coverage definitions as a result of new court decisions, inflation in costs to repair or replace damaged property, inflation in the cost of medical services, as well as the particular, unique facts that pertain to each claim. As a result, the rate at which claims arose in the past and the costs to settle them may not always be representative of what will occur in the future.

        Management believes that Transguard's insurance and claims reserves are reasonable, however, for the reasons previously discussed, the amounts of the reserves established as of a given balance sheet date and the subsequent actual losses and loss expenses paid will likely differ, perhaps by a material amount. There is no guarantee that recorded reserves will prove to be adequate. If management determines that an adjustment to insurance and claims reserves is appropriate, the adjustment to earnings is made in the accounting period in which such determination is made in accordance with GAAP.

Reinsurance

        Transguard reinsures a portion of the risks it underwrites in order to control its exposure to losses, stabilize earnings and protect capital resources. Transguard cedes to reinsurers a portion of these risks and pays premiums based upon the risks and exposure of the policies subject to reinsurance. Reinsurance involves credit risks and is generally subject to aggregate loss limits. Although the reinsurer is liable to Transguard to the extent of the reinsurance ceded, Transguard remains liable as the direct insurer on all risks reinsured. Transguard monitors the financial conditions of reinsurers on an ongoing basis, and reviews its reinsurance arrangements periodically. Reinsurers are selected based on their financial condition, business practices and the price of their product offerings. The amount of premiums ceded to reinsurers for the year ended December 31, 2002 and the nine months ended September 30, 2003 was $8.1 million and $7.9 million, respectively.

NAIT

        NAIT is an association of independent owner/operators. In exchange for annual membership dues of $122, NAIT offers a broad array of products and services, designed to improve the profitability and quality of life of the independent trucker. These services include fuel and tire discounts, emergency breakdown assistance, retirement programs, legal assistance, calling cards and overnight delivery. NAIT members are also offered a range of insurance services by Transguard. Since we acquired NAIT in April of 2002, we have been successful in selling its services both to our network of service providers and to non-affiliated owner operators, with membership rising from approximately 13,300 in April 2002, when we acquired NAIT, to approximately 24,800 as of September 30, 2003, despite experiencing substantial turnover in the membership base during this period. Our marketing efforts are directed toward attracting new members from the total population of more than 165,000 independent owner/operators in the United States.

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Fleet Services

        Through our fleet services business, we use the scale of our fulfillment network to offer our agents and drivers discount vehicle and supply purchase programs, and access to a nationwide network of independent repair centers to meet their needs when on the road. We also offer repair services through two of our own facilities, including one of the largest commercial equipment maintenance facilities in the U.S. Approximately 81% of fleet services operating revenues are for non-affiliated customers. In the future, we intend to offer new services to agents, drivers and small fleet owners, including outsourced administrative services, tax management, load optimization and proprietary affiliated marketing services.

Competition

        Our competition in the insurance industry is composed of large, general-line insurance companies, such as State Farm and Firemans Fund, and smaller companies that focus on our market, the most important of which is Vanliner, a subsidiary of Unigroup. The bases for competition in this industry are primarily price, product offerings and perceived quality of the insurance company. Fleet services is a highly fragmented industry with many service providers, including Comdata, Wright Express and Western Union. Competition for fleet services is on the basis of service offering, price and geographic scope.

Transportation Solutions

        Our transportation solutions business is a participant in the third party logistics industry. Third party logistics companies provide outsourcing services for a full range of customer supply chain functions, including order fulfillment, freight bill auditing and payment, cross-docking, product marking, labeling and packaging, inventory and warehouse management, parts return and repair and the physical movement of goods. According to industry sources, about half of all logistics costs incurred in the U.S. relate to services provided by independent suppliers. According to Armstrong & Associates, the third party logistics services sector of the domestic logistics market was approximately $65 billion in 2002.

        Our Transportation Solutions business provides inventory management solutions using proprietary asset management technology, to coordinate a variety of services such as order fulfillment, project-specific delivery management, and the tracing of products through customers' supply chains. We use our technology expertise developed in our moving and storage business to provide sophisticated inventory management solutions, including serialized tracking, inventory and stock management, in-transit product merge and configuration and other customized services, principally to customers with inventory tracking requirements. We also provide freight forwarding and other selected supply chain solutions. Our Transportation Solutions segment is organized into two business units:

•

Inventory management solutions, which uses proprietary asset management technology to coordinate a variety of services such as finished goods, order fulfillment, project-specific delivery management and the tracing of products through the supply chain; and



•

Transportation management services, which provides freight optimization and transportation management services to customers.

        Our Transportation Solutions segment manages customers' inventory primarily through our proprietary OnTrac Network, a technology system that integrates transportation management tools into our 32 company and agent-owned logistics centers.

        We sell our Transportation Solutions to corporate customers through our ten-member corporate sales team. This team is augmented by over 50 agent network sales personnel, who, while selling Specialized Transportation, often identify opportunities for Transportation Solutions.

Competition

        We compete with a broad spectrum of logistics providers including inventory management software providers, freight forwarders, brokers and various other logistics providers. The primary basis of competition is service,

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network and technology capabilities. Both in North America and Europe, logistics services providers are bundling services to offer single-source logistics solutions. Some of our primary competitors in supply chain management services are Exel, UPS, Ryder Logistics, FedEx Logistics, Menlo Logistics, Deutsche Post and UPS Logistics.

Government Regulation

        Our operations are subject to various federal, state, local and foreign laws and regulations that in many instances require permits and licenses. Our U.S. interstate motor carrier operations, as a common and contract carrier, are regulated by the Surface Transportation Board and the Federal Motor Carrier Safety Administration, which are independent agencies within the U.S. Department of Transportation. The Surface Transportation Board has jurisdiction similar to the former Interstate Commerce Commission over such issues as rates, tariffs, antitrust immunity and undercharge and overcharge claims. The Department of Transportation, and in particular the Federal Motor Carrier Safety Administration, also has jurisdiction over such matters as safety, the registration of motor carriers, freight forwarders and brokers, insurance (financial responsibility) matters, financial reporting requirements and enforcement of leasing and loading and unloading practices. In addition to motor carrier operations, we also conduct domestic operations as a licensed or permitted freight forwarder and property broker. Many of the licenses and permits that we hold were issued by the Interstate Commerce Commission, which was eliminated in 1996; some of its regulatory functions are now performed by the Department of Transportation, the Surface Transportation Board and the Federal Motor Carrier Safety Administration. With respect to interstate motor carrier operations, the Federal Motor Carrier Safety Administration is the principal regulator in terms of safety, including carrier and driver qualification, drug and alcohol testing of drivers, hours of service requirements and maintenance and qualification of equipment.

        We are an ocean transportation intermediary pursuant to the Shipping Act of 1984, as amended. As such, we hold ocean freight forwarder licenses issued by the Federal Maritime Commission, or FMC, and are subject to FMC bonding requirements applicable to ocean freight forwarders. We also conduct certain operations as a non-vessel-operating common carrier and are subject to the regulations relating to FMC tariff filing and bonding requirements, and under the Shipping Act of 1984, particularly with respect to terms thereof proscribing rebating practices. The FMC does not currently regulate the level of our fees in any material respect.

        Our U.S. Customs brokerage activities are licensed by the United States Department of the Treasury and are regulated by the United States Bureau of Customs and Border Protection. We are also subject to similar regulations by the regulatory authorities of foreign jurisdictions in which we operate.

        With respect to U.S. state and Canadian provincial licenses, the permitting and licensing structure largely parallels the U.S. federal licensing regulatory structure.

        In the United States, North American Van Lines, Allied and Global have been participants in certain collective activities, including collective rate-making with other motor carriers pursuant to an exemption from the antitrust laws as currently set forth in The Motor Carrier Act of 1980. Over the years, the scope of the antitrust exemption has decreased and there can be no assurance that such exemption from the antitrust laws will continue in the future. The loss of such exemption could result in an adverse effect on our operations or financial condition.

        In Europe, including the United Kingdom, we hold "O" (operators) licenses and international transport licenses in the eleven countries in which we run trucks. These licenses are approvals from the relevant local authority permitting the operation of commercial vehicles from specified bases. One of the prerequisites for these licenses is the employment by the relevant business of individuals who hold certain certificates of professional competence concerning their management of the business's fleet of vehicles.

        In the Asia Pacific region, we hold various commercial vehicle licenses. Additionally, in Australia we hold licenses for international relocation for our customs, quarantine and air freight operation and to store dangerous goods in connection with our management and operation of gas refueling tanks. We also are applying to be licensed under Australia's Financial Services Reform Act so that we can comply with a 2004 requirement that will apply to our sale of insurance-style products within our moving business. In New Zealand, we hold a goods service license to operate as a removalist, licenses for branded warehouses at major ports of entry in connection with our receipt of

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imported goods, and government approvals in connection with our establishment as a customs branded area and an approved facility for exams.

        Transguard and our other insurance subsidiaries such as The Baxendale Insurance Company Ltd., which is part of our Europe and Asia Pacific business, are subject to extensive supervision and regulation by insurance regulators in their respective jurisdictions, including regulations limiting the transfer of assets, loans, or the payments of dividends from such insurance subsidiaries to their affiliates, including us. Such regulation could limit our ability to draw on these insurance subsidiaries' assets to repay our indebtedness.

        SIRVA Title Agency, Inc. and its affiliate National Settlement must be licensed in any state in which they act as an agent to offer title insurance. SIRVA Title Agency is licensed in Ohio and National Settlement is licensed in 25 states. Each state has a varying degree of regulatory and annual reporting requirements. In addition, in order to receive referral fees, SIRVA Relocation is currently licensed, through individual employees, as a real estate broker in Ohio. Internal Revenue Service rules and regulations concerning home sale transactions also have a significant impact on our Global Relocation Solutions segments.

        SIRVA Mortgage, Inc. is authorized to conduct first lien mortgage lending activity as a mortgage banker in all fifty states and the District of Columbia and second lien mortgage activity in 41 states. SIRVA Mortgage has obtained a mortgage lending license and is licensed in good standing (or has received an exemption from regulation) in all states where required. State mortgage licensing laws and regulation activities have a significant impact on our mortgage lending activities.

        Any violation of the laws and regulations discussed above could increase claims and/or liabilities, including claims for uninsured punitive damages. Failure to maintain required permits or licenses, or to comply with applicable regulations could subject us to fines or, in the event of a serious violation, suspension or revocation of operating authority or criminal penalties. All of these regulatory authorities have broad powers generally governing activities such as authority to engage in motor carrier operations, rates and charges and certain mergers, consolidations and acquisitions. Although compliance with these regulations has not had a materially adverse effect on our operations or financial condition in the past, there can be no assurance that such regulations or any changes to such regulations will not materially adversely impact our operations in the future.

        Our international operations are conducted primarily through local branches owned or leased by various subsidiaries in 21 countries outside the United States and in a number of additional countries through agents, franchises and non-exclusive representatives. We are subject to certain customary risks inherent in carrying on business abroad, including the effect of regulatory and legal restrictions imposed by foreign governments.

Environmental Matters

        Our facilities and operations are subject to environmental laws and regulations in the various foreign, U.S., state and local jurisdictions in which we operate. These requirements govern, among other things, (i) discharges of pollutants into the air, water and land, (ii) the management and disposal of solid and hazardous substances and wastes, and (iii) the cleanup of contamination. Some of our operations require permits intended to prevent or reduce air and water pollution and these may be reviewed, modified or revoked by the issuing authorities.

        We actively monitor our compliance with environmental laws and regulations and management believes that we are presently in material compliance with all applicable requirements. For example, underground storage tanks are monitored on a regular basis by company personnel and pressure-tested periodically by qualified third-party providers. The tanks have leak detection systems for early leak detection. Compliance costs are included in our results of operations and are not material. We will continue to incur ongoing capital and operating expenses to maintain or achieve compliance with applicable environmental requirements, upgrade existing equipment at our facilities as necessary and meet new regulatory requirements. While it is not possible to predict with certainty future environmental compliance requirements, management believes that future expenditures relating to environmental compliance requirements will not materially adversely affect our financial condition or results of operations.

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        We have been, and in the future may be, responsible for investigating or remediating contamination at our facilities or at off-site locations to which we sent wastes for disposal. For example, because we own or lease or have in the past owned or leased facilities at which underground storage tanks are located and operated, we are subject to regulations governing the construction, operation and maintenance of underground storage tanks and for preventing or cleaning up releases from these tanks. We have incurred, and in the future may incur, costs related to our investigation and cleanup of releases of materials from underground storage tanks, though such costs are not expected to have a material adverse effect on our financial position or results of operations. Contaminants have been detected at certain of our present or former sites principally in connection with historical operations. We could incur significant costs if we were required to investigate and remediate these sites.

        We have also been named as a potentially responsible party, or PRP, in two environmental cleanup proceedings brought under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, or similar state statutes. Based on all known information, it is estimated that the cost to resolve liability at these sites would not be materially or significantly larger than the reserves established. We could incur unanticipated costs, however, if additional contamination is found at these sites, or if we are named as a PRP in other proceedings.

        Based on our assessment of facts and circumstances now known, management believes it is unlikely that any identified matters, either individually or in aggregate, will have a material adverse effect on our financial position, results of operations, or liquidity. As conditions may exist on our properties related to environmental problems that are latent or as yet unknown, however, there can be no assurance that we will not incur liabilities or costs, the amount and significance of which cannot be reliably estimated at this time.

Trademarks

        We have registered the marks northAmerican®, Allied®, Home Touch!®, and Worldtrac® and have filed an application to register the mark, SIRVA. Other brand or product names used in this prospectus are trademarks or registered trademarks of their respective companies.

        We have been highly active in seeking protection for numerous marks and logos relating to the "SIRVA", "northAmerican", "Allied", "Global" and "Pickfords" brands. We have actively contested unauthorized use of the "northAmerican", "Global" and "Allied" marks. We have largely been successful, but in a few exceptional circumstances have tolerated some third-party use of similar marks in transport-related commerce where we felt that there was no confusion by such use and no confusion was likely to occur in the future.

Employees

        As of December 31, 2002, our workforce comprised approximately 7,500 employees of which approximately 1,700 were unionized. As of September 30, 2003, our workforce comprised approximately 7,800 employees. We believe our relationships with our employees are good. The unionized employees consisted of approximately 1,500 employees covered by union agreements in the United Kingdom and approximately 200 employees in Asia, New Zealand and Australia. We have not experienced any major work stoppages in the last ten years.

Properties

        We lease executive and administrative office space at our headquarters at 700 Oakmont Lane, Westmont, Illinois. We also own executive and administrative office space at 5001 U.S. Highway 30 West, Fort Wayne, Indiana, and operate warehouse space (which is primarily owned). We also own or lease major facilities in Mayfield Heights, Ohio, used by our relocation services operations, in Canada used by Relocation Solutions—North America and throughout the United Kingdom, Australia and New Zealand, each used by Relocation Solutions—Europe & Asia Pacific and own or lease facilities at significant Global Relocation Solutions locations in many countries throughout the world. All the other properties used in our operations consist of freight forwarding offices, administrative offices and warehouse and distribution facilities.

        We believe that our office, warehouse and distribution facilities are generally well maintained and suitable to support our current and planned business needs.

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Legal Proceedings

        We were a defendant in a personal injury suit resulting from a 1996 accident involving one of our agent's drivers. The case was tried in 1998, and we were found liable. After appeals, a final judgment of $15.2 million was rendered in 2002, which we and two of our insurers fully paid. After these insurance payments and reimbursements, we have paid $7.6 million which we believe is fully reimbursable by insurance. TIG Insurance Co., one of our several co-insurers, filed suit against us, one of our subsidiaries and several other parties in the 191st Judicial District Court of Dallas County, Texas, on September 12, 2002, contesting TIG's and other insurers' coverage obligation and seeking declaratory judgment. We filed a counterclaim and cross-claim against TIG and National Union Fire Insurance Company, seeking reimbursement for all remaining amounts that we paid in satisfaction of the judgment and associated costs and expenses. We filed a motion for summary judgment in August 2003, and the judge has made a preliminary ruling granting us partial relief in the form of a $2.4 million award. However, this ruling is not final. The court has not resolved our claim for additional reimbursement for amounts we paid in satisfaction of the underlying judgment or our attorney fees, or TIG's contention that the award to us should be reduced. A hearing on these issues is expected in the near future. We have a reserve that we consider appropriate in the circumstances.

        We have been named as a PRP in two environmental cleanup proceedings brought under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, or similar state statutes. Based on all known information, it is estimated that the cost to resolve liability at these sites would not be materially or significantly larger than the reserves established. We could incur significant unanticipated costs, however, if additional contamination is found at these sites, or if we are named as a PRP in other proceedings.

        We have produced and are producing records in response to grand jury subpoenas issued in connection with an investigation being conducted by attorneys in the Department of Justice (DOJ) Antitrust Division through a grand jury in the Eastern District of Virginia. We are cooperating with this investigation and understand that numerous other companies have received similar subpoenas. We believe that the investigation relates to the transportation of U.S. military members' household goods between the U.S. and foreign countries, which is managed and administered by the Military Transportation and Management Command of the U.S. Army, utilizing private moving companies.

        The revenues that we derived from our international military business during the years ended December 31, 2000, 2001 and 2002 and during the nine months ended September 30, 2003 were small and declining, representing less than 2% of our consolidated operating revenues in 2000, and declining to less than 1% in the first nine months of 2003. While the investigation is ongoing and exposes us to potential criminal, civil, and administrative penalties, it is difficult to predict its outcome with certainty at this time before the government makes its decisions and advises us of them. Management believes that, based on information currently available to it, the investigation's outcome will not have a material adverse impact on our overall operations or financial condition, although there can be no assurance that it will not. Any potential fines, penalties or judgments, however, may have a material effect on our earnings in the period in which they are recognized. We are also subject to other issues that may be raised by government agencies in connection with our government contracts.

        Some of our moving services operations in Europe are being investigated by European antitrust regulators. The investigations are in the very early stages and involve certain anticompetitive practices. The relevant operations represented less than 1.5% of our consolidated operating revenue in the aggregate for the years ended December 31, 2000, 2001 and 2002, and the nine months ended September 30, 2003. The investigations could expose us to administrative and other penalties. We are cooperating with the investigations which we expect will take several years to complete. Management believes that, based on information currently available to it, the outcome of the investigations will not have a material adverse impact on our overall operations or financial condition, although there can be no assurance that it will not. Any potential penalties, however, may have a material impact on our earnings in the period in which they are recognized.

        We are involved from time to time in other routine legal matters incidental to our business, including lawsuits relating to conduct of our agents and drivers. Such accidents have included, and in the future may include, serious injuries or the loss of lives. While we may be liable for damages or suffer reputational harm from litigation, we believe that legal proceedings will not have a material adverse effect on our financial position or results of operations.

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MANAGEMENT

Directors and Executive Officers

        The following table sets forth certain information with respect to our current directors and officers.

Name	Age	Position
Brian P. Kelley	42	Director, President and Chief Executive Officer
James W. Rogers	53	Director, Chairman of the Board of Directors
Kathleen J. Affeldt	54	Director
Robert J. Dellinger	43	Director
Sir Jeremy Mackenzie	62	Director
Edward H. Orzetti	38	Director
Richard J. Schnall	34	Director
Carl T. Stocker	59	Director
Douglas E. Christensen	45	President, Transportation Solutions
John M. Dupuy	47	President, U.S. Moving and Specialized Transportation
Michael P. Fergus	51	President, Moving Services
Ralph A. Ford	56	Senior Vice President, General Counsel and Secretary
Douglas V. Gathany	47	Vice President, Treasurer
Ann M. Harten	41	Senior Vice President, Chief Information Officer
Michael K. Kingston	46	Managing Director, Europe
Ronald L. Milewski	52	Senior Vice President, Global Risk Management
Kevin D. Pickford	46	Managing Director, Asia Pacific
Robert J. Rosing	44	President, North America Relocation Solutions
Joan E. Ryan	47	Senior Vice President, Chief Financial Officer
Todd W. Schorr	46	Senior Vice President, Human Resources
Dennis M. Thompson	44	Vice President, Corporate Controller
Lawrence A. Writt	46	President, Network Services

Brian P. Kelley became our President and Chief Executive Officer, and a Director, in August 2002. From September 2001 until he joined our company, Mr. Kelley served as President of the Lincoln Mercury business of Ford Motor Company. Prior to joining Ford, where he also was a Vice President of Global Consumer Services from 1999 to 2001, Mr. Kelley was a senior executive for General Electric Company from 1994 to 1999. Mr. Kelley began his career at Procter & Gamble in 1983, where he was ultimately responsible for some of the company's most recognized brand names. Mr. Kelley received a Bachelor of Arts in economics from The College of Holy Cross.

James W. Rogers became a Director of our company in February 1999 and has served as the Chairman of the Board of Directors since November 1999. From April 2001 until August 2002, when Mr. Kelley joined our company, Mr. Rogers served as our President and Chief Executive Officer. Mr. Rogers is a principal of Clayton, Dubilier & Rice, Inc., a limited partner of CD&R Associates V Limited Partnership and CD&R Associates VI Limited Partnership, and a stockholder and director of CD&R Investment Associates II, Inc. and CD&R Investment Associates VI, Inc. Prior to joining Clayton, Dubilier & Rice, Inc. in 1998, Mr. Rogers was a Senior Vice President and a member of the Corporate Executive Council of General Electric Company. From 1995 to 1998, Mr. Rogers was President and Chief Executive Officer of GE Industrial Control Systems. Mr. Rogers is currently the Chairman of Brake Bros plc, a European-based food distribution company. Mr. Rogers has a Bachelor of Arts in economics from Rutgers College.

Kathleen J. Affeldt became a Director of our company in August 2002 and currently serves as Chairman of the Compensation Committee of the Board of Directors. Ms. Affeldt retired from Lexmark International in February 2003 where she had been Vice President of Human Resources since July 1996. She joined Lexmark when it

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became an independent company in 1991 as the Director of Human Resources. Ms. Affeldt began her career at IBM in 1969, specializing in sales of supply chain systems. She later held a number of human resources management positions.

Robert J. Dellinger became a Director of our company in March 2003. Since June 2002, Mr. Dellinger has been Executive Vice President and Chief Financial Officer of Sprint Corporation, where he previously served as Executive Vice President—Finance from April 2002 to June 2002. Before joining Sprint, Mr. Dellinger had served as President and Chief Executive Officer of GE Frankona Re based in Munich, Germany with responsibility for the European operations of General Electric's Employers Reinsurance Corporation, a global reinsurer, from 2000 to 2002. From 2001 to 2002, he also served as President and Chief Executive Officer of General Electric's Employers Reinsurance Corporation's Property and Casualty Reinsurance business in Europe and Asia. From 1997 to 2000, he served as Executive Vice President and Chief Financial Officer of General Electric's Employers Reinsurance Corporation. Other positions Mr. Dellinger held at GE include Manager of Finance for GE Motors and Industrial Systems and Director of Finance and Business Development for GE Plastics Pacific based in Singapore. Mr. Dellinger graduated from Ohio Wesleyan University with a B.A. in economics and a minor in accounting. He is a member of the Financial Executives Institute.

General Sir Jeremy Mackenzie became a Director of our company in June 2003 and currently serves as the Chairman of the Nominating and Corporate Governance Committee of our Board of Directors. Sir Jeremy spent a long, decorated career in the British Army, and is currently the Governor of the Royal Hospital Chelsea and U.K. advisor to the governments of Slovenia and Bulgaria, and for the Department of International Development, to Uganda. He has commanded at every level of command in the U.K. Army, from Platoon to Corps, and was promoted to full General in 1994 in the post of Deputy Supreme Allied Commander Europe with special responsibility for the Partnership for Peace Program involving 27 countries in Central and Eastern Europe and the building of forces for the NATO operations in Bosnia and Kosovo. He was Commandant of the British Army Staff College Camberley, and has an in-service Fellowship from Kings College London University. As Commander of the 1^st British Corps he was Knighted (KCB), and subsequently commanded NATO's Allied Command Europe Rapid Reaction Corps as its first Commander. He was made Knight Grand Cross of the Order of the Bath (GCB) in 1999, having previously been awarded the U.S. Legion of Merit twice (1997, 1999), and Officer of the Order of the British Empire. He holds the Czech Republic Cross of Merit First Class, the Officers Cross of the Order of Merit of the Republic of Hungary, the Order of the Madara Horseman first Class of Bulgaria, and the Officers' Gold Medal of Merit from Slovenia. He was aide-de-camp to Her Majesty Queen Elizabeth II from 1992 to 1996. Sir Jeremy was educated at The Royal Military Academy Sandhurst and commissioned into the Queen's Own Highlanders in July 1961.

Edward H. Orzetti became a Director of our company in August 2002. Mr. Orzetti is President of Textron Fluid & Power. Before assuming his current position in June 2003, he had been Vice President Enterprise Excellence since joining Textron in October 2000. Mr. Orzetti spent from 1995 to 2000 in various positions at General Electric, where he most recently served as general manager, supply chain management for GE Supply in 2000. While at GE, Mr. Orzetti also directed its central European sourcing operations in the Czech Republic. Prior to joining GE, Mr. Orzetti worked for Booz-Allen & Hamilton as a senior associate in their operations management group from 1993 to 1995 and for Johnson & Johnson as a manufacturing supervisor from 1990 to 1992. Mr. Orzetti also served for several years as an officer and helicopter pilot in the U.S. Army. Mr. Orzetti holds a BS degree in mechanical engineering from the United States Military Academy at West Point, an MS in administration and human resource management from Central Michigan University and an MS in management, operations and strategy from the Sloan School of Management at the Massachusetts Institute of Technology.

Richard J. Schnall became a Director of our company in March 2002. Mr. Schnall is a principal of Clayton, Dubilier & Rice, Inc. Prior to joining Clayton, Dubilier & Rice, Inc. in 1996, he worked in the Investment Banking division of Donaldson, Lufkin & Jenrette, Inc. and Smith Barney & Co. Mr. Schnall is a limited partner of CD&R Associates V Limited Partnership and CD&R Associates VI Limited Partnership, and a director and stockholder of CD&R Investment Associates II, Inc. and CD&R Investment Associates VI, Inc. He serves as a director of Acterna

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Corporation and Brake Bros plc. Mr. Schnall is a graduate of the Wharton School of Business and Harvard Business School.

Carl T. Stocker became a Director of our company in May 2000 and currently serves as the Chairman of the Audit Committee of our Board of Directors. Since 1996, Mr. Stocker has owned and managed his own acquisition, investment and consulting company. Prior to that time, he served as the chief financial executive of General Electric's Industrial Systems business from 1990 to 1996 and the chief information executive from 1992 to 1996. He was also a member of General Electric's Corporate Finance and Information Technology Councils during these same periods, and served as a senior integration leader for the Space Systems Division created by General Electric's acquisition of RCA. Mr. Stocker graduated from Wright State University in 1970 after serving with the U.S. Army.

Douglas E. Christensen joined our company in February 2002 and serves as President, Transportation Solutions. From 1980 to 2001, Mr. Christensen held a number of successive positions of increasing responsibility at USF Corporation, most recently as President and CEO of USF Worldwide Logistics, USF's logistics and freight forwarding businesses. Mr. Christensen received a Bachelor of Arts in economics from the University of Western Ontario and a Masters in Business in marketing and finance from York University in Canada.

John M. Dupuy joined our company in 2001 and serves as President, U.S. Moving and Specialized Transportation with responsibility for U.S. moving services and specialty transportation operations, and shared services, as well as corporate-wide responsibility for sourcing. Mr. Dupuy brings over 20 years of experience in transforming operations, formulating business strategy, and mergers and acquisitions. From 1996 until he joined our company, Mr. Dupuy was at Maytag serving in various positions including Vice President of Strategic Planning, General Manager Emerging Solutions and Chief Information Officer. Prior to 1996, Mr. Dupuy worked as a management consultant conducting strategic and operations improvement assignments for clients around the globe. Mr. Dupuy holds a Bachelor of Science degree in Industrial Engineering from Georgia Institute of Technology and an MBA from Southern Methodist University.

Michael P. Fergus serves as President, Moving Services. Mr. Fergus has been President and Chief Executive Officer of Allied Van Lines since 1995. Mr. Fergus joined Allied in 1973 and held various management positions in the company including Vice President, Allied International; Senior Vice President, Operations; and Chief Operating Officer. Mr. Fergus is past Chairman of the Household Goods Carriers' Bureau, is a member of the World Trade Club, and was Chairman of the Board of Directors for the American Moving & Storage Association from February 2002 through February 2003. Mr. Fergus holds a Bachelor of Science in communications from Southern Illinois University.

Ralph A. Ford joined our company in 1999 and serves as Senior Vice President, General Counsel and Secretary. Previously, Mr. Ford served 18 years in the General Electric legal department, most recently as General Counsel to GE Industrial Control Systems from 1992 to 1999. Prior to joining General Electric, Mr. Ford served as group counsel for Bell & Howell Company, as an attorney for E.I. duPont deNemours & Co. and an associate with Venable, Baetjer & Howard. Mr. Ford earned a Bachelor of Arts from Morgan State College and a Juris Doctor from Boston University Law School.

Douglas V. Gathany joined our company in June 2001 and currently serves as Vice President, Treasurer. Prior to joining our company, Mr. Gathany served in various positions with Montgomery Ward since 1979, including as Vice President-Treasurer from 1996 to 2001. He received a Masters of Business Administration in Finance from The University of Chicago and a B.A. from Colby College.

Ann M. Harten became our Senior Vice President and Chief Information Officer in May 2003. Ms. Harten joined our company in July 2000 as Chief Information Officer for our Logistics business and most recently served as Chief Information Officer for our US operations. From 1987 to 2000, Ms. Harten held a variety of management and director level positions in sales, operations and information technology at Boise Cascade Office Products. Ms. Harten has a Bachelor of Science in Psychology from Indiana University of Pennsylvania.

Michael K. Kingston serves as Managing Director, Europe. Mr. Kingston is employed by Pickfords Limited, based in the United Kingdom, with responsibilities for operations in Europe. Mr. Kingston joined our company in

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1999 and has held a variety of senior management roles. Prior to joining us, Mr. Kingston served in various senior international financial and commercial positions with Grand Metropolitan, Fish Price and Menzies. Mr. Kingston holds a degree in finance from the University of Limerick in Ireland.

Ronald L. Milewski joined our company in May 1990 and serves as Senior Vice President, Global Risk Management. Mr. Milewski also served as Senior Vice President and Chief Financial Officer from March 2001 to February 2003, Corporate Controller from November 1999 through March 2001 and Vice President of Finance for North American Van Lines. Previously, Mr. Milewski served as Group Controller at Johnson Controls from 1985 to 1990 and Assistant Controller for Hoover Universal from 1979 to 1985. He is a member of the American Institute of Certified Public Accountants, the American Moving and Storage Association and the ATA Technical Councils. Mr. Milewski holds a Bachelor of Business Administration in accounting from Eastern Michigan University and is a Certified Public Accountant.

Kevin D. Pickford serves as Managing Director, Asia Pacific. Mr. Pickford is employed by Allied Pickfords Pty Ltd, our main Australian company, with responsibilities for the Asia Pacific Region. Mr. Pickford joined NFC plc in 1978 and has held a variety of senior management roles. From 1997 until the Allied Acquisition, he was Managing Director for NFC's Asia Pacific Moving Services. Prior to 1997, he was Managing Director for Allied Pickfords with responsibility for Australian and New Zealand operations. Mr. Pickford is a graduate and Fellow of the Chartered Associations of Certified Accountants and additionally holds membership in the Australian Institute of Company Directors.

Robert J. Rosing serves as President, North America Relocation Solutions. Mr. Rosing brings more than 20 years of experience to our company, joining us after our May 2002 purchase of the relocation services business of Cooperative Resource Services. After joining Cooperative Resource Services in 1995, Mr. Rosing served as President of its Cooperative Mortgage Services and ProSource Properties subsidiaries and was also Senior Vice President of Operations for all of Cooperative Resource Services's Cleveland-based relocation services. Prior to joining Cooperative Resource Services, Mr. Rosing served as Executive Vice President and CFO for Holland Mortgage Corporation, where he managed all operations, finance, legal and human resource activities. Mr. Rosing earned a Bachelor of Science degree in Natural Sciences from Xavier University and a Masters degree in Business Administration—Finance from Cleveland State University.

Joan E. Ryan joined our company in February 2003 and serves as Senior Vice President and Chief Financial Officer. Prior to joining our company, Ms. Ryan served as a Director of our company from June 2002 to February 2003 and Executive Vice President and Chief Financial Officer of Tellabs from February 2000 to February 2003. Prior to joining Tellabs, Ms. Ryan spent from 1998 to 2000 at Alliant Foodservice, most recently as Senior Vice President and Chief Financial Officer. Ms. Ryan served as Vice President of Finance and Chief Financial Officer of Ameritech Small Business Services from 1995 to 1998. Ms. Ryan began her career in 1978 with Price Waterhouse and Co. and held various leadership and management positions at Baxter Healthcare Corporation, Kewaunee Scientific Corporation and the Nutrasweet Company. Ms. Ryan is a director of Federal Signal Corporation. Ms. Ryan holds a bachelor's degree in accounting from the University of Illinois, Champaign-Urbana and is a Certified Public Accountant.

Todd W. Schorr joined our company in June 2000 and serves as Senior Vice President, Human Resources. Prior to joining our company, Mr. Schorr served in Cummins' Human Resources department for a total of twelve years, most recently as Group Director of International Human Resources with functional responsibility for operations in India, China, the United Kingdom, Korea, Japan, Brazil, Mexico, and Australia from 1998 to 2000. Mr. Schorr also served from 1988 to 1992 at Pepsi in the Human Resources department. Mr. Schorr holds a Bachelor of Science degree from Indiana University, and a Masters degree with specialization in Labor Relations and Labor Law from Indiana University.

Dennis M. Thompson joined our company in 1986 and currently serves as Vice President, Corporate Controller. Prior to joining us, he held various management positions with Schneider National from 1981 to 1986. Mr. Thompson received his Bachelor of Science degree in accounting and his Masters of Business Administration from Indiana University and is a Certified Public Accountant.

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Lawrence A. Writt serves as President, Network Services. Since 1991, Mr. Writt has been President and Chief Executive Officer of Transguard Insurance Company of America, Inc. and Vanguard Insurance Agency, Inc., both wholly owned subsidiaries of Allied Van Lines. Mr. Writt joined Allied in 1979 and has held various management positions in the Company including Insurance Group Controller. Mr. Writt is also a director of both Transguard and Vanguard. Mr. Writt has a Bachelor of Science in economics and accounting from St. Joseph's College.

Board Composition

        Our business and affairs are managed under the direction of our Board of Directors. The Board is currently composed of eight directors, none of whom, with the exception of Mr. Kelley, are officers of our company, and five of whom are independent directors under the applicable rules of the New York Stock Exchange. Prior to the closing of this offering, our board of directors will be divided into three classes serving staggered three-year terms. The terms of office of each class expire at different times in annual succession, with one class being elected at each year's annual meeting of shareholders. Ms. Affeldt and Messrs. Schnall and Stocker will be members of Class I and will serve until the 2004 annual meeting. Messrs. Kelley, Mackenzie and Orzetti will be members of Class II and will serve until the 2005 annual meeting. Messrs. Dellinger and Rogers will be members of Class III and will serve until the 2006 annual meeting. In addition, in order to ensure compliance with the independence requirements of the New York Stock Exchange and applicable law, the composition of the Board may change prior to and following the offering. It is our intention to be in full and timely compliance with all applicable rules of the New York Stock Exchange and applicable law, including with respect to the independence of our directors. Because we expect to be considered a "controlled company" under applicable New York Stock Exchange rules following the offering, we may not be subject to all New York Stock Exchange rules relating to director independence. Upon the closing of this offering, the director designation, observer and other rights granted to Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership under their Stock Subscription Agreements will terminate.

Executive Compensation

        The following table describes the compensation paid to (1) the current and former Chief Executive Officers for services rendered during the fiscal year ended December 31, 2002, and (2) the four other most highly compensated executive officers for services rendered during the fiscal year ended December 31, 2002.

								Long-term Compensation Awards
Name & Principal Position	Year	Salary ($)		Bonus ($)		Other Annual Compensation ($)(3)		Securities Underlying (#)(4) Option	All Other Compensation ($)(5)
Brian P. Kelley(1) Director, President, Chief Executive Officer	2002	$	210,096	$	234,726	$	21,702	665,700	$	12,965
James W. Rogers(2) Chairman of the Board, President and Chief Executive Officer	2002		—		—		—	—		—
Michael P. Fergus President, Moving Services	2002	$	299,988	$	146,244	$	47,861	—	$	10,420
Ralph A. Ford Senior Vice President, General Counsel and Secretary	2002	$	238,500	$	112,601	$	37,741	—	$	1,754
John M. Dupuy President, U.S. Moving and Specialized Transportation	2002	$	225,000	$	123,133	$	40,847	126,800	$	3,897
Lawrence A. Writt President, Network Services	2002	$	214,477	$	159,062	$	24,547	—	$	624

(1)

Mr. Kelley became President and Chief Executive Officer on August 19, 2002.

(2)

Mr. Rogers served as President and Chief Executive Officer until Mr. Kelley joined our company on August 19, 2002. Mr. Rogers is a principal of Clayton, Dubilier & Rice, Inc., a limited partner of CD&R Associates Fund V Limited Partnership and of CD&R Associates Fund VI Limited Partnership and a stockholder and director of CD&R Investment

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Associates II, Inc. and CD&R Investment Associates VI, Inc. Mr. Rogers received no compensation for his services as President and Chief Executive Officer. For each of the years ended December 31, 2002 and 2001, we paid Clayton, Dubilier & Rice, Inc. $0.375 million in connection with the services provided by Mr. Rogers as our President and Chief Executive Officer from his election in April 2001 until Brian P. Kelley was named President and Chief Executive Officer in August 2002. Mr. Rogers also serves as Chairman of the Board.

(3)

SIRVA provides certain perquisites to the executives named above (namely, a car allowance, health insurance premiums and, in certain cases, financial planning, a cellular phone allowance, and travel and social club memberships), in each case in an amount less than the amount required to be individually disclosed. The amounts disclosed include amounts reimbursed to the executives named above for the payment of income taxes due in connection with the receipt of such perquisites.

(4)

All options are held under the SIRVA, Inc. Stock Incentive Plan. See "SIRVA, Inc. Stock Incentive Plan." Adjusted to reflect the proposed reclassification of each share of our common stock into 3.17 shares of common stock that we intend to effect prior to the consummation of this offering.

(5)

Amounts in this column include (i) the payment by us of premiums on a split-dollar life insurance policy for Mr. Fergus ($750) and Mr. Writt ($306), (ii) imputed income on the value of the split-dollar life insurance policy calculated at year end for Mr. Fergus ($9,670) and Mr. Writt ($318) and (iii) the payment by us of relocation expenses for Mr. Kelley ($12,965), Mr. Dupuy ($3,897) and Mr. Ford ($1,754), taking into account the taxable nature of providing such a benefit.

Option Grants in the Fiscal Year Ended December 31, 2002

        The following table sets forth information concerning individual grants of stock options made during the fiscal year ended December 31, 2002 to the executives named below.

	Number of Securities Underlying Options Granted (1)	% of Total Options Granted to Employees in the fiscal year ended December 31, 2002		Exercise Price ($/share)		Expiration Date	Potential Realizable Value at Assumed Annual Rates of Stock Price Appreciation for Option Term
							5%($)(2)		10%($)(2)
Brian P. Kelley	665,700	29.9	%	$	4.48	9/15/2012	$	4,857,365	$	7,734,538
James W. Rogers	—	—			—	—		—		—
Michael P. Fergus	—	—			—	—		—		—
Ralph A. Ford	—	—			—	—		—		—
John M. Dupuy	126,800	5.7	%	$	4.48	2/15/2012	$	925,213	$	1,473,247
Lawrence A. Writt	—	—			—	—		—		—

(1)

All options were granted under the SIRVA, Inc. Stock Incentive Plan, which is administered by our Board of Directors. See "SIRVA, Inc. Stock Incentive Plan." Adjusted to reflect the proposed reclassification of each share of our common stock into 3.17 shares of common stock that we intend to effect prior to the consummation of this offering.

(2)

Potential realizable value is based on the assumed annual growth for each of the grants, shown over their ten-year option term. Actual gains, if any, on stock option exercises are dependent on the future value of the stock.

Stock Option Grants and Values as of December 31, 2002

        The following table sets forth information regarding grants of options to purchase shares of our common stock and the value of such options as of December 31, 2002. Such options were granted to the executives listed in the Summary Compensation Table pursuant to the SIRVA, Inc. Stock Incentive Plan.

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Aggregated Option Exercises and December 31, 2002 Option Value

			Number of Securities Underlying Unexercised Options at Fiscal Year-End (#)(1)	Value of Unexercised In-the-Money Options at Fiscal Year-End ($)
Name	Shares Acquired on Exercise (#)	Value Realized ($)	Exercisable/ Unexercisable	Exercisable/ Unexercisable
Brian P. Kelley	—	—	0 shares/	$	0/903,000
			665,700 shares
James W. Rogers	—	—	0 shares/	$	0/0
			0 shares
Michael P. Fergus	—	—	145,236 shares/	$	197,009/232,991
			171,763 shares
Ralph A. Ford	—	—	110,873 shares/	$	150,397/150,603
			111,026 shares
John M. Dupuy	—	—	3,170 shares/	$	4,300/189,200
			139,480 shares
Lawrence A. Writt	—	—	46,218 shares/	$	62,694/70,520
			51,988 shares

(1)

Adjusted to reflect the proposed reclassification of each share of our common stock into 3.17 shares of common stock that we intend to effect prior to the consummation of this offering.

Retirement Plans

        We sponsor the SIRVA, Inc. Employee Retirement Plan, a funded, non-contributory defined benefit pension plan covering eligible employees of our company in the United States. We also sponsor an excess benefit plan which is an unfunded, non-qualified plan that provides retirement benefits not otherwise provided under the retirement plan because of the benefit limitations imposed by Section 415 and 401(a)(17) of the Internal Revenue Code. The excess benefit plan ensures that an executive receives the total pension benefit to which he or she would otherwise be entitled, were it not for such Code limitations. Brian P. Kelley, Michael P. Fergus, Ralph A. Ford, John M. Dupuy and Lawrence A. Writt were the only executives listed in the Summary Compensation Table participating in these plans during fiscal year 2002. The pension plan and the excess benefit plan were frozen, effective December 31, 2002.

        The retirement plan provides each eligible employee with retirement benefits based principally on years of service with us, compensation rates over that time, and estimated primary Social Security benefits. The following table shows the estimated annual pension benefits payable to a covered participant at normal retirement age (65) under both the retirement plan and the excess benefit plan. These benefits are based on the final pay formula contained in the retirement plan that applies to all benefits and that accrue under both plans, which is discussed below.

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Pension Plan Table

	Years of Service
Average Annual Compensation
	5		10		15		20		25
$200,000	$	13,690	$	27,379	$	41,069	$	54,758	$	68,448
$225,000	$	15,565	$	31,129	$	46,694	$	62,258	$	77,823
$250,000	$	17,440	$	34,879	$	52,319	$	69,758	$	87,198
$275,000	$	19,315	$	38,629	$	57,944	$	77,258	$	96,573
$300,000	$	21,190	$	42,379	$	63,569	$	84,758	$	105,948
$400,000	$	28,690	$	57,379	$	86,069	$	114,758	$	143,448
$600,000	$	43,690	$	87,379	$	131,069	$	174,758	$	218,448
$800,000	$	58,690	$	117,379	$	176,069	$	234,758	$	293,448
$1,000,000	$	73,690	$	147,379	$	221,069	$	294,758	$	368,448
$1,200,000	$	88,690	$	177,379	$	266,069	$	354,758	$	443,448

        Benefits available under the retirement plan and the excess benefit plan are subject to offset for Social Security benefits. Compensation taken into account under the plans is the average monthly compensation paid to a participant during the consecutive 60-month period over the most recent 120-month period that produces the highest average compensation. For this purpose, compensation includes the total of base salary and bonus.

        Benefits are payable in the form of straight life annuity or a joint and survivor annuity. As of December 31, 2002, Mr. Ford had accrued 3.5 years of credited service.

Compensation of Directors

        Prior to June 13, 2002, members of our Board who were not employees of company, North American Van Lines or Clayton, Dubilier & Rice, Inc. received an annual retainer fee of $40,000. An additional annual fee of $10,000 was paid to the chairman of each committee who was not an employee of our company, North American Van Lines, or Clayton, Dubilier & Rice, Inc. Members of our Board did not receive any additional compensation for their services in such capacity. Directors were reimbursed for reasonable travel and lodging expenses incurred to attend meetings.

SIRVA, Inc. Directors Compensation Plan

        On June 13, 2002, our Board of Directors approved the SIRVA, Inc. Directors Compensation Plan, under which members of our Board who are not employees of our company, North American Van Lines or Clayton, Dubilier & Rice, Inc. receive at least 50% of such director's annual retainer fee of $40,000 in our common stock and the balance in cash, as elected by the director. The cash payment and the stock grant are made quarterly in arrears. The chairman of each committee who is an eligible director receives an additional annual fee of $10,000 in cash. The Directors Compensation Plan has a five-year term and 317,000 shares of our common stock are available for issuance under the plan.

        The Directors Compensation Plan also permits an eligible director to elect to receive 50% or more of his or her total compensation in "deferred" shares and the balance in shares of our common stock, cash or both, if such director so elects prior to the beginning of the calendar year in which services are to be performed. These deferred shares represent our contractual promise to deliver our common stock when a participating director's service as a director has terminated.

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Federal Income Tax Consequences

        The following is a brief description of the material U.S. federal income consequences generally arising with respect to awards issued pursuant to the SIRVA, Inc. Directors Compensation Plan.

        A director who receives cash, and stock that is not subject to any restrictions will generally recognize ordinary income equal to the fair market value of the cash or shares delivered. The fair market value of the shares delivered will be the product of the number of shares delivered and the fair market value of our common stock as of the December 31 (or other more recent date) immediately preceding the award date of the shares as determined by our Board of Directors for purposes of the SIRVA, Inc. Stock Incentive Plan. A director who receives deferred shares (whether in respect of cash or shares) will generally not recognize ordinary income with respect to the deferred shares when they are so deferred, but will generally recognize ordinary income equal to the amount of the cash or the fair market value of the shares distributed in the year in which the cash or shares are distributed. We will generally be entitled to a deduction in an amount equal to the ordinary income recognized by the director in the year the income is so recognized.

Employment Agreements

        Brian P. Kelley.    Effective August 19, 2002, Brian P. Kelley became our President and Chief Executive Officer pursuant to an at will employment agreement dated June 28, 2002, which was amended and restated as of July 8, 2002. Mr. Kelley receives an annual base salary of $575,000 and participates in our management incentive plan (as described below), with a target annual bonus opportunity up to 100% of his base salary. If Mr. Kelley's employment is terminated without cause, he will continue to receive his annual base salary and health benefits for one year (or, if earlier, until he obtains other employment). Upon such an involuntary termination within two years following a change of control, Mr. Kelley will instead receive a payment equal to twice his annual base salary, as well as a pro rated bonus for the year of termination (based on his target opportunity for such year).

        Michael P. Fergus.    We are also a party to an employment agreement with Michael P. Fergus, our President, Moving Services. Pursuant to this agreement, Mr. Fergus currently receives annual base salary of $300,000 and participates in our management incentive plan, with a target annual bonus opportunity of up to 46% of his base salary. The employment agreement was entered into as of December 5, 1994, and continues until terminated by either party upon one year's notice, by the Company for "cause" (as defined in the agreement), by Mr. Fergus for "cause" (as defined in the agreement), or by Mr. Fergus' death or disability. If the Company terminates Mr. Fergus' employment by giving one year's notice, the Company may also relieve him of his duties. In that situation, Mr. Fergus would continue to receive his annual base salary and benefits until the end of the one year period. If Mr. Fergus terminates his employment for "cause," he would be entitled to receive accrued and unpaid base salary and benefits, and no additional payments. The employment agreement also contains customary non-competition, non-solicitation and confidentiality provisions.

SIRVA, Inc. Management Incentive Plan

        Effective January 1, 2003, SIRVA established the SIRVA, Inc. Management Incentive Plan. The Plan is designed to assure that amounts paid to certain executive officers of the Company will be deductible by our company for Federal income tax purposes notwithstanding the limitations imposed by section 162(m) of the Code (as described below). Employees of our company and our subsidiaries who are at or above the director level and who do not participate in another cash incentive plan or bonus program are eligible to receive awards under this plan. Participation may also be extended to certain key associates employed by our subsidiaries based outside of the United States. The Plan is administered by our Compensation Committee which has full discretionary authority with respect to the Plan and awards made thereunder. The determination of the Compensation Committee on all matters relating to the Plan or any award made thereunder will be final and binding.

        Under the Plan, the Compensation Committee must establish the performance measures and award determination formula no later than 90 days into each performance period (or such other date as may be required or permitted under section 162(m) of the Code). The performance measures under the Plan may include revenue growth, earnings before interest, taxes, depreciation and amortization (EBITDA), earnings before interest, taxes and

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amortization (EBITA), strategic and leadership initiatives, operating income, pre- or after-tax income, cash flow, cash flow per share, net earnings, earnings per share, return on equity, return on invested capital, return on assets, economic value added (or an equivalent metric), share price performance, total shareholder return, improvement in or attainment of expense levels, improvement in or attainment of working capital levels, and debt reduction. Performance measurements may be established on a corporate wide basis or with respect to one or more business units, subsidiaries, or divisions. Performance goals may be measured in either absolute terms or relative to a specified company, group of peers or other external index. Measurement of performance may exclude the impact of charges for restructurings, discontinued operations, extraordinary items and other unusual or non-recurring items.

        The Plan provides that, if specified performance target(s) for SIRVA are exceeded on a year over year basis, each of our businesses is allocated a bonus pool for distribution. However, bonuses will be only paid to eligible employees upon achievement of particular performance targets established by the Compensation Committee as described above. The performance metrics chosen are weighted differently for each business unit. At the end of each performance period, the Compensation Committee certifies in writing whether, and to what extent, the performance targets have been achieved.

        For the Company's 2003 fiscal year, our fiscal year is the performance period used to evaluate achievement of the performance measures. For the Company's 2003 fiscal year, the specified performance target that must be exceeded on a year over year basis before any bonus pool is allocated is EBITA. In addition, eligible employees will only be entitled to receive a bonus under the plan upon achievement of earnings growth targets, cash generation targets, and strategic and leadership initiatives goals for each business within the fiscal year 2003 performance period.

        The award can range from zero to a specified maximum of $3,000,000 for any "covered employee" (as defined in section 162(m) of the Code) eligible to participate in the Plan. The Compensation Committee cannot increase an award payable to a "covered employee" calculated in accordance with the terms and conditions of the Plan, but it can exercise "negative discretion" to downwardly adjust a "covered employee's" (or any other participant's) award based on individual performance.

        Awards under the Plan may be paid in cash and/or shares of our common stock as determined by the Compensation Committee in its sole discretion (in each case less appropriate withholding and employment taxes) on or before March 15 of the year following the end of the performance period, or may be deferred, in cash or shares of our Common Stock pursuant to our deferred compensation plans in accordance with the terms and conditions of such plan documents. Any shares in respect of awards under the Plan will be issued under the SIRVA, Inc. Omnibus Stock Incentive Plan, as described below.

        Our Board may terminate or suspend the Plan any time, and from time to time may amend or modify the Plan, provided that without the approval by a majority of the votes cast at a meeting of shareholders at which a quorum representing a majority of the shares of Common Stock is present in person or by proxy, no amendment or modification to the Plan may result in any payment made pursuant to the Plan not qualifying for deductibility under section 162(m) of the Internal Revenue Code. This Plan shall continue until terminated by the Board.

Federal Income Tax Consequences

        The following is a brief description of the material U.S. federal income tax consequences generally arising with respect to the Management Incentive Plan.

        A participant in the Plan will generally recognize ordinary income equal to the cash bonus he or she receives in the year it is paid, and we will generally be entitled to a deduction of the same amount for such year.

        Section 162(m) of the Internal Revenue Code generally limits the ability of a public corporation to deduct compensation greater than $1,000,000 paid with respect to a particular year to an individual who is, on the last day of that year, the corporation's chief executive officer or one of its four other most highly compensated executive officers, other than compensation that is "performance related" within the meaning of section 162(m). Under a special rule that applies to corporations that become public through an initial public offering, this limitation generally will not apply to compensation that is paid pursuant to the plan before the first meeting of our stockholders in 2007 at which directors will be elected.

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SIRVA, Inc. Stock Incentive Plan

General

        Our Board of Directors administers the SIRVA, Inc. Stock Incentive Plan. Under this plan, our Board may grant rights to purchase shares of our common stock and options to purchase shares of our common stock to our executive officers and other key employees, and agents and consultants. Our Board may delegate the authority to administer the plan to a duly constituted committee of our Board.

Shares Subject to Stock Incentive Plan

        A maximum of 9,510,000 shares may be issued under the plan. Of those shares, up to 3,170,000 shares of our common stock are permitted to be sold to participants and up to 6,340,000 options may be granted. The options allow participants to purchase shares of our common stock. Options granted under the plan that are canceled without having been exercised may be reissued under the plan. As of September 30, 2003, 2,093,662 shares have been issued and 4,560,072 options were outstanding under the plan.

Shares

        Under the plan, participants may be offered the right to purchase shares of our common stock. The purchase price of the shares will equal the fair market value of our common stock on the date of the offer. If a participant chooses to purchase shares, such participant must agree not to sell or otherwise dispose of the shares purchased under the plan, except in compliance with the Securities Act and the subscription agreement entered into between such participant and us. Under the subscription agreement, participants are not permitted to transfer shares purchased at any time before an underwritten public offering of our common stock, led by at least one underwriter of nationally recognized standing except under limited circumstances. Clayton, Dubilier & Rice Fund V Limited Partnership is the only stockholder that currently has the right to initiate a public offering by itself. In addition, any sale or other disposition must also be made in compliance with any applicable state and foreign securities laws. Further, if we file a registration statement under the Securities Act with respect to an underwritten public offering of the common stock, participants may not sell or distribute any shares of common stock to the public during the 20 days before and the 180 days after the effective date of the registration statement, other than as part of the public offering. The restrictions on transfer will not continue following a public offering of our common stock.

Options

        Under the plan, two types of options may be granted: service options and performance options. Service options become vested and exercisable in equal annual installments on each of the first five anniversaries of the grant date. Performance options generally become vested and exercisable upon achievement of specified cumulative earnings targets, except that, to the extent not vested sooner, they become vested on the ninth anniversary of the grant date. In addition, our Board of Directors may accelerate the exercisability of any option at any time and from time to time. All options granted expire after ten years from the grant date. In connection with offerings of common stock to participants under the plan that took place prior to December 31, 2001, we granted two options for each share of our common stock purchased: one service option and one performance option. In subsequent offerings, we have granted and, in future offerings expect to grant, two service options for each share of our common stock purchased. In such case, no performance options have been or will be granted.

        The exercise price of the options will equal the fair market value of our common stock at the date of the grant. The exercise price of any options exercised at any time following a public offering may be paid in full or in part in the form of shares of our common stock that have been owned by the holder for at least six months, based on the fair market value of such shares of common stock on the date of exercise.

        In the event of a participant's termination of service with us or any of our subsidiaries by reason of death, disability or retirement at age 65, those options that have become vested and exercisable prior to the date of termination of service shall remain exercisable until the first to occur of: (1) the day that is six months after the date of termination of employment or (2) the expiration of the term of the option. Those options that have not become vested and exercisable prior to the date of termination of service by reason of death, disability or retirement at age 65 shall be canceled immediately upon such termination of service.

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        In the event of the participant's termination of service with us or any of our subsidiaries for cause, all vested and unvested options held by a participant shall be forfeited and terminated immediately upon such termination of service.

        In the event a participant's service with us or any of our subsidiaries is terminated for any other reason, such participant's vested and exercisable options shall remain exercisable solely until the first to occur of:

•

the 60th day after such termination and



•

the expiration of the term of the options. Those options that have not become vested and exercisable prior to the date of termination of service shall be canceled immediately upon such termination of employment.

Change in Control

        Upon a "change in control" (as defined in the plan) of our company or North American Van Lines, each vested and unvested service option, all vested performance options and a percentage of the unvested performance options will be canceled in exchange for a payment in cash of an amount equal to the excess, if any, of the price paid in the change in control transaction over the exercise price. All remaining unvested performance options will be canceled. Any payments made in such event will generally be paid within 30 days after the change in control and will be made in cash or in shares of capital stock of the acquirer, as determined by our Board of Directors. Notwithstanding the foregoing, if our Board determines before the change in control either that:

•

all outstanding options will be honored or assumed by the acquirer, or



•

alternative options with equal or better terms will be made available, the outstanding options will not be canceled, their vesting and exercisability will not be accelerated, and there will be no payment in exchange for the options.

        To be approved by our Board of Directors, any alternative options offered must:

•

have substantially equivalent economic value to the outstanding options, and



•

must have terms which provide, upon the involuntary termination of an optionee's employment within two years of the change in control, for either (a) unrestricted exercisability and transferability of the alternative options; or (b) a payment in exchange for any alternative options that equals the difference between the exercise price of such alternative options and the fair market value of the stock subject to such alternative options at the time of the involuntary termination.

        Options cannot be transferred or assigned by a participant other than by will or by the laws of descent or to us or Clayton, Dubilier & Rice Fund V Limited Partnership under their right to purchase options on termination of employment. In addition, options can be exercised only by a participant or a participant's estate after death.

Federal Income Tax Consequences

        The following is a brief description of the material U.S. federal income consequences generally arising with respect to awards issued pursuant to the SIRVA, Inc. Stock Incentive Plan.

        The purchase of shares of our common stock pursuant to the plan (including those acquired upon the exercise of options) does not normally give rise to any income, gain or loss to the purchaser. However, where the purchased stock is transferred to a particular participant in connection with the performance of services, the purchase and ownership of this stock may give rise, either at the time of purchase or in the future, to taxable ordinary income in an amount equal to the excess, if any, of the fair market value of the property over the purchase price. This income is recognized, and the fair market value determined, either (a) at the time of purchase or (b) if the property has both a substantial risk of forfeiture and a transfer restriction when purchased and the purchaser does not make an election pursuant to section 83(b) of the Code, at the time either the substantial risk of forfeiture or transfer restriction no longer applies to the property. Because of the restrictions on the transfer of the shares and the conditions attached to ownership of the shares contained in the management stock subscription agreements, the shares purchased by participants may be viewed as having a substantial risk of forfeiture and a transfer restriction from after the date of purchase and until the date on which this offering is consummated. We will be entitled to a deduction in an amount equal to the ordinary income recognized by the participant in the year the income is so recognized.

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        The grant of a stock option will generally not give rise to taxable income to the option holder or entitle us to a deduction. Upon exercising an option, the option holder will generally recognize ordinary income in an amount equal to the excess, if any, of the fair market value of our common stock on the date of exercise over the exercise price, and we will generally be entitled to a tax deduction in the same amount in the year the income is so recognized.

        Section 162(m) of the Internal Revenue Code generally limits the ability of a public corporation to deduct compensation greater than $1,000,000 paid with respect to a particular year to an individual who is, on the last day of that year, the corporation's chief executive officer or one of its four other most highly compensated executive officers, other than compensation that is "performance related" within the meaning of section 162(m). Under a special rule that applies to corporations that become public through an initial public offering, this limitation generally will not apply to compensation that is paid pursuant to the SIRVA, Inc. Stock Incentive Plan before the first meeting of our stockholders in 2007 at which directors will be elected.

        In connection with the offering, we expect that our Board will terminate the SIRVA, Inc. Stock Incentive Plan and replace that plan with the SIRVA, Inc. Omnibus Stock Incentive Plan described below.

SIRVA, Inc. Omnibus Stock Incentive Plan

General

        Prior to the completion of the offering, we expect that our Board will adopt and our shareholders will approve the SIRVA, Inc. Omnibus Stock Incentive Plan, or the Omnibus Plan. The Omnibus Plan will provide for the award to eligible participants of stock options, including incentive stock options (within the meaning of section 422 of the Internal Revenue Code), stock appreciation rights, performance stock and performance units, restricted stock and restricted stock units, and deferred stock units. Awards may be made to any non-employee member of our Board of Directors, officer or employee of our company or any of our subsidiaries, including any prospective employee, and any of our consultants or advisors.

        The Omnibus Plan will generally be administered by the Compensation Committee. Initially, we anticipate that 7,600,000 shares of our common stock will be available for award under the Omnibus Plan. Shares subject to awards that are forfeited, canceled or otherwise terminated without the issuance of common stock under the Omnibus Plan or the SIRVA, Inc. Stock Incentive Plan will again be available for future awards under the Omnibus Plan. In addition, shares that are tendered to pay the exercise price for any option award or withheld to satisfy any withholding taxes with respect to any award will also return to the share reserve and be available for future grant. Also, shares issued in connection with awards that are assumed, converted or substituted pursuant to a merger or an acquisition will not count against the share reserve. Under the Omnibus Plan, during any three-year period, no one person will be able to receive more than 1,000,000 options and/or stock appreciation rights. For stock awards subject to performance requirements, no one person will be able to receive more than 200,000 shares during any performance period of 36 months, with proportionate adjustment for shorter or longer periods not to exceed five years. In addition, no one person will be able to generally receive an award that is payable in cash of more than $5,000,000 for any performance period of 36 months, with proportionate adjustments for shorter or longer performance periods not to exceed five years.

Options

        Both "incentive stock options," which satisfy the requirements of section 422 of the Internal Revenue Code, or "nonqualified stock options," which are not intended to satisfy the requirements of section 422 of the Internal Revenue Code may be granted under the Omnibus Plan. Under the terms of the Omnibus Plan, the exercise price of the options will not be less than the closing price of our common stock on the grant date. The exercise price of the options will be payable in cash or its equivalent or by other methods as permitted by the Compensation Committee.

        The options will have a term of no greater than seven years from the grant date and will become exercisable in accordance with the vesting schedule determined at the time the awards are granted.

        Upon the death or disability of any option holder and unless otherwise determined at the time of grant or subsequently by the Compensation Committee, the option holder (or his or her beneficiary or legal representative)

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will be able to exercise (i) any incentive stock option, regardless of whether then vested, until the earlier of (a) one year from the date of termination, or (b) the date the option would otherwise expire, and (ii) any nonqualified option, regardless of whether then vested, for a period of one year. Upon the retirement of any option holder and unless otherwise determined at the time of grant or subsequently by the Compensation Committee, if the option holder agrees to be bound by certain customary restrictive covenants for a period of three years following the date of retirement, any options previously granted to the option holder will continue to vest in accordance with their terms as if such participant had not retired and, to the extent then vested and exercisable, will be able to be exercised by the option holder (or his or her beneficiary or legal representative) until the earlier of (i) three years from the date of retirement, or (ii) the date the option would otherwise expire.

        Upon the termination of an option holder's employment for cause, all options held by the option holder, whether or not vested, will be terminated and be canceled as of the date of termination.

        Upon the termination of an option holder's employment for any other reason and unless otherwise determined by the Compensation Committee, the option holder will be able to exercise any vested option until the earlier of (i) 60 days after the date of termination, or (ii) the date the option would otherwise expire, and all unvested options will be terminated as of the date of termination.

        In general, if an option holder, directly or indirectly, competes with any business in which he or she was employed (or in which we have documented plans to become engaged of which the option holder has knowledge at the time of his or her termination), solicits any of our employees, or discloses or misuses any confidential information during the option holder's employment with us, during any post-termination option exercise period, or during the one-year period ending after the expiration of any post-termination option exercise period, the option holder would automatically forfeit any options then held, and would be required to repay to us all financial gain he or she realized from exercising all or part of any option within the period commencing six-months prior to termination of employment and ending on the date of expiration of the one-year period following any post-termination option exercise period.

Stock Appreciation Rights

        Stock appreciation rights may be granted under the Omnibus Plan. Stock appreciation rights may be granted alone or together with options. Unless otherwise determined at the time of grant or subsequently by the Compensation Committee, a stock appreciation right granted together with an option will have terms that are substantially identical to the option, to the extent applicable. Similarly and to the extent applicable, a stock appreciation right granted alone will have terms that are substantially identical to the options that are granted under the Omnibus Plan. Upon exercise of a stock appreciation right, the holder will be entitled to receive payment equal to the product of (i) the excess of the closing price of a share of common stock on the date of exercise over the closing price of a share of common stock on the grant date, multiplied by (ii) the number of shares of common stock with respect to which stock appreciation rights are exercised. Payments in respect of the exercise of a stock appreciation right may be made in cash, common stock or a combination thereof, as determined at the time of grant or subsequently by the Compensation Committee.

Performance Stock and Performance Units

        The Compensation Committee will be able to award performance stock and performance units under the Omnibus Plan. Performance stock is an award of common stock that vests upon the achievement of certain performance objectives during a specified measurement period. A performance unit represents our contractual obligation to pay a specified amount of cash to a participant upon the achievement of certain performance objectives during a specified measurement period. Performance stock and performance units may be payable in either cash and/or shares of our common stock. Performance stock will carry voting rights. Performance units will not carry voting rights.

        The Compensation Committee will determine the terms and conditions of awards, including the performance objectives to be achieved during the performance measurement period and the determination of whether and to what degree the specified objectives have been attained. The performance objectives will include revenue growth, earnings before interest, taxes, depreciation and amortization (EBITDA), earnings before interest, taxes and

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amortization (EBITA), operating income, pre- or after-tax income, cash flow, cash flow per share, net earnings, earnings per share, return on equity, return on invested capital, return on assets, economic value added (or an equivalent metric), share price performance, total shareholder return, improvement in or attainment of expense levels, improvement in or attainment of working capital levels, and debt reduction. Performance measurements may be established on a corporate wide basis or with respect to one or more business units, subsidiaries, or divisions. Performance goals may be measured in either absolute terms or relative to a specified company, group of peers or other external index. Measurement of performance may exclude the impact of charges for restructurings, discontinued operations, extraordinary items and other unusual or non-recurring items.

        Unless otherwise determined at the time of grant or subsequently by the Compensation Committee, participants will be entitled to receive, either currently or at a future date, all dividends and other distributions paid with respect to the performance awards.

        Upon termination of a participant's employment due to death or disability during the performance measurement period and unless otherwise determined by the Compensation Committee, all of the participant's performance stock and performance units will become vested and nonforfeitable as to that percentage of the award that would have been earned based on the attainment of performance objectives through the date of termination. Upon termination of a participant's employment due to retirement during the performance measurement period and subject to satisfaction of customary restrictive covenants following such date for a period of 3 years, all of the participant's performance stock and performance units will become vested and nonforfeitable as to the percentage of the award that would have been earned as of the date of retirement, and such amounts will become payable upon completion of the entire performance measurement period based on actual results as of the termination date. Unless otherwise determined at the time of grant or subsequently by the Compensation Committee, upon any other termination of a participant's employment, all of the performance stock and performance units held by the participant will be forfeited.

Restricted Stock and Restricted Stock Units

        Restricted stock and restricted stock units will also be available for grant under the Omnibus Plan. Restricted stock is an award of common stock that vests upon the participant's completion of a specified period of service with the Company. A restricted stock unit represents our contractual obligation to deliver our common stock or the cash equivalent to a participant upon the participant's completion of a specified period service with the Company. Unless otherwise determined at the time of grant or subsequently by the Compensation Committee, participants will be entitled to receive either currently or at a future date, dividends or other distributions paid with respect to restricted stock and restricted stock units. Restricted stock will carry voting rights, however, restricted stock units will not carry voting rights until the underlying shares are issued.

        Upon termination of a participant's employment due to death or disability during any restriction period and unless otherwise determined at the time of grant or subsequently by the Compensation Committee, the participant's restricted stock and restricted stock units will become vested and nonforfeitable as to that percentage of the award that would have been earned based on his or her service through the date of termination. Unless otherwise determined at the time of grant or subsequently by the Compensation Committee, upon any other termination of a participant's employment, all of the restricted stock and restricted stock units held by the participant that have not become vested will be forfeited.

Deferred Stock

        Under the Omnibus Plan, a participant may receive an award of deferred stock. Deferred stock represents our contractual obligation to deliver shares of our common stock at the end of a specified deferral period. Deferred stock may also be settled in cash.

        Unless otherwise determined at the time of grant, participants will be entitled to receive additional deferred stock in respect of dividends or other distributions paid with respect to his or her deferred stock. Deferred stock will not carry voting rights until the underlying shares have been issued.

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        Unless the Compensation Committee determines otherwise and unless a participant's employment is terminated for cause, that participant would receive the shares of our common stock underlying his or her deferred shares (or cash in lieu thereof).

Change in Control

        In the event of a change in control (as defined in the Omnibus Plan), all outstanding options and stock appreciation rights shall become fully vested and exercisable, the restriction period applicable to any awards of restricted stock, restricted stock units and freestanding deferred stock shall lapse, and shares of our common stock underlying restricted units and deferred stock shall be issued or, at the discretion of the Compensation Committee, each award of options, stock appreciation rights, restricted stock units or deferred stock, as the case may be, shall be canceled in exchange for a payment in cash equal to the product of (i) (A) in the case of options and stock appreciation rights, the excess of the change in control price over the exercise price or base price, as the case may be, and (B) in the case of all other awards, the change of control price, and (ii) the number of shares of common stock covered by such award.

        Upon a change in control, (a) any performance period in progress at the time of the change in control for which performance stock or performance units are outstanding shall end, (b) all participants granted such awards of performance stock or performance units shall be deemed to have earned a pro rata award equal to the product of (i) such Participant's target award opportunity for the performance period in question based on performance versus goals as of such date and (ii) the percentage of performance objectives achieved as of the date of such change in control, or (c) at the discretion of the Compensation Committee, all such earned Performance Units shall be canceled in exchange for an amount equal to the product of (i) the change in control price, multiplied by (ii) the aggregate number of shares of our common stock covered by such award. All of the performance shares and performance units that have not been so earned shall be forfeited and canceled as of the date of the change in control.

        Notwithstanding the foregoing, if the Compensation Committee determines before the change in control either that all outstanding awards of options, stock appreciation rights, restricted stock, restricted stock units, and deferred stock will be honored or assumed by the acquirer, or alternative awards with equal or better terms will be made available, such outstanding awards of options, stock appreciation rights, restricted stock, restricted stock units and deferred stock will not be canceled, their vesting and exercisability will not be accelerated, and there will be no payment in exchange for such awards. Any alternative awards offered must generally satisfy the requirements for alternative awards described under the heading "SIRVA, Inc. Stock Incentive Plan" except that a participant will not have the right at the time of his or her involuntary termination to surrender his or her alternative awards for a payment equal to the value of such award. Alternative awards shall not be made available for performance stock or performance units.

Non-U.S. Participants

        The Compensation Committee may, in order to conform with provisions of local laws and regulations in foreign countries in which our company or any of our subsidiaries operate, (i) modify the terms and conditions of awards granted under the Omnibus Plan to participants employed outside the United States, (ii) establish subplans with modified exercise procedures or other modifications as may be necessary or advisable under such local laws and regulations; and (iii) take any actions which it deems advisable to obtain or comply with any necessary governmental regulatory procedures, exemptions or approvals with respect to the Omnibus Plan or any subplan.

Nontransferability of Awards

        Awards under the Omnibus Plan will generally not be assignable or transferable other than by will or by the laws of descent and distribution, and all awards and rights will be exercisable during the life of the participant only by the participant or his or her legal representative. The Compensation Committee may, upon such terms and conditions as it determines appropriate, permit transfers to the participant's family members or to entities of which the participant or his or her family members are the sole beneficiaries or owners.

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Term and Amendment

        The Board may terminate or suspend the Omnibus Plan any time, and from time to time may amend or modify the Omnibus Plan, provided that without the approval by a majority of the votes cast at a meeting of shareholders at which a quorum representing a majority of the shares of Common Stock is present in person or by proxy, no amendment or modification to the Omnibus Plan may (i) materially increase the benefits accruing to participants under the Omnibus Plan, (ii) except as a result of an adjustment event (as defined in the Omnibus Plan), materially increase the number of shares of Common Stock subject to awards under the Omnibus Plan or the maximum number of awards or amount of cash that may be granted to a participant under the Omnibus Plan, or (iii) materially modify the requirements for participation in the Omnibus Plan. No amendment, modification, or termination of the Omnibus Plan shall in any manner adversely affect any award previously granted under the Omnibus Plan, without the consent of the participant. The Omnibus Plan shall continue in effect, unless sooner terminated by the Board, until the tenth anniversary of the date on which it is adopted by the Board.

Federal Income Tax Consequences

        The following is a brief description of the material U.S. federal income tax consequences generally arising with respect to awards issued pursuant to the Omnibus Plan.

        The grant of an option will generally not give rise to tax consequences for the option holder or entitle us to a deduction. Upon exercising an option, other than an incentive stock option, the option holder will generally recognize ordinary income equal to the excess, if any, of the closing price of the shares acquired on the date of exercise over the exercise price, and we generally will be entitled to a tax deduction in the same amount in the year the income is so recognized. Generally, upon exercise of an incentive stock option, the participant would not recognize income upon exercise if the participant (i) does not dispose of the shares within two years after the date of grant or one year after the transfer of shares upon exercise, and (ii) is an employee of the Company or a subsidiary thereof from the date of grant and through and until three months before the exercise date. Any gain would be taxed to the participant as long-term capital gain and the Company would not be entitled to a deduction. The excess of the market value on the exercise date over the exercise price is an item of tax preference, potentially subject to the alternative minimum tax.

        With respect to other awards, upon the payment of cash or the issuance of shares or other property that is either not restricted as to transferability or not subject to a substantial risk of forfeiture, the participant will generally recognize ordinary income equal to the cash or the fair market value of shares or other property delivered. The fair market value of the shares delivered will be the product of the number of shares delivered and the closing price of a share of common stock on the date of delivery of the shares. We will be entitled to a deduction in an amount equal to the ordinary income recognized by the participant in the year the income is so recognized.

        Section 162(m) of the Internal Revenue Code generally limits the ability of a public corporation to deduct compensation greater than $1,000,000 paid with respect to a particular year to an individual who is, on the last day of that year, the corporation's chief executive officer or one of its four other most highly compensated executive officers, other than compensation that is "performance related" within the meaning of section 162(m). Under a special rule that applies to corporations that become public through an initial public offering, this limitation generally will not apply to compensation that is paid pursuant to the Omnibus Plan before the first meeting of our stockholders in 2007 at which directors will be elected.

Certain Committees of the Board of Directors

        Audit Committee.    We have an audit committee consisting of Messrs. Dellinger, Orzetti and Stocker. The audit committee has responsibility for, among other things:

•

recommending to the board of directors the selection of our independent auditors,

•

reviewing and approving the scope of the independent auditors' audit activity and extent of non-audit services,

•

reviewing with management and the independent accountants the adequacy of our basic accounting systems and the effectiveness of our internal audit plan and activities,

•

reviewing with management and the independent accountants our financial statements and exercising general oversight of our financial reporting process, and

•

reviewing litigation and other legal matters that may affect our financial condition and monitoring compliance with our business ethics and other policies.

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        Compensation Committee.    The Board established a Compensation Committee to review all compensation arrangements for our CEO and other executive officers. The individuals serving on the Compensation Committee are Ms. Affeldt, Mr. Orzetti and Sir Jeremy Mackenzie. Following the offering, we expect to be considered a "controlled company" under applicable New York Stock Exchange governance requirements because we expect that Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership will in the aggregate continue to own a majority of our outstanding voting stock. As a controlled company, we are not required to comply with New York Stock Exchange rules that require listed companies to have nominating and corporate governance and compensation committees composed entirely of independent directors or to have written charters for such committees addressing specified matters. At such time as we are no longer a "controlled company," we will adopt or amend our committee charters and change the composition of our committees to ensure compliance with these New York Stock Exchange requirements.

        Compensation Committee Interlocks and Insider Participation.    SIRVA, North American Van Lines and Clayton, Dubilier & Rice, Inc. are parties to an Amended and Restated Consulting Agreement, dated as of January 1, 2001, pursuant to which Clayton, Dubilier & Rice, Inc. provides us with financial advisory and management consulting services. We pay Clayton, Dubilier & Rice, Inc. a management fee of $1.0 million annually, which we review on an annual basis. For each of the years ended December 31, 2002 and 2001, we paid Clayton, Dubilier & Rice, Inc. an additional $0.375 million in connection with the services provided by Mr. Rogers as our President and Chief Executive Officer from his election in April 2001 until Brian P. Kelley was named President and Chief Executive Officer in August 2002. Mr. Rogers received no compensation for his services as President and Chief Executive Officer.

        SIRVA, North American Van Lines, Clayton, Dubilier & Rice, Inc. and Clayton, Dubilier & Rice Fund V Limited Partnership have entered into an Indemnification Agreement, dated as of March 30, 1998, pursuant to which we have agreed to indemnify Clayton, Dubilier & Rice, Inc., Clayton, Dubilier & Rice Fund V Limited Partnership, any other investment vehicle managed by Clayton, Dubilier & Rice, Inc., their respective directors, officers, partners, employees, agents and controlling persons, against certain liabilities arising under federal securities laws, liabilities arising out of the performance of the consulting agreement and certain other claims and liabilities.

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PRINCIPAL STOCKHOLDERS

        The following table lists all shares of our common stock that, as of September 30, 2003 were beneficially owned by the following holders, without giving effect to the offering:

•

each stockholder known to us to beneficially own more than 5% of the outstanding shares of our common stock,



•

each of our directors,



•

each of the executives listed in the Summary Compensation Table, and



•

all of our directors and executive officers as a group.

        For information concerning selling stockholders, see "Selling Stockholders". For more information regarding the terms of our common stock, see "Description of Capital Stock," and for information regarding transactions and relationships with the following listed beneficial owners, see "Certain Relationships and Related Transactions."

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	Shares Outstanding Before the Offering
Name and Address of Beneficial Owner(1)	Number	Percent
Clayton, Dubilier & Rice Fund V Limited Partnership(2)	32,221,750	56.60	%
Clayton, Dubilier & Rice Fund VI Limited Partnership(3)	13,394,422	23.53	%
Exel International Holdings (Netherlands 2) BV(4)	10,105,294	16.93	%
Name of Executive Officers and Directors(1)
Brian P. Kelley(5)	355,040	*
James W. Rogers(6)	448,776	*
Douglas E. Christensen(7)	88,760	*
John M. Dupuy(8)	91,930	*
Michael P. Fergus(9)	272,036	*
Ralph A. Ford(10)	228,289	*
Douglas V. Gathany(11)	83,909	*
Ann M. Harten	31,700	*
Michael K. Kingston(12)	53,201	*
Ronald L. Milewski(13)	275,007	*
Kevin D. Pickford(14)	51,800	*
Robert J. Rosing(15)	88,760	*
Joan E. Ryan	128,808	*
Todd W. Schorr(16)	69,740	*
Dennis M. Thompson(17)	35,589	*
Lawrence A. Writt(18)	103,246	*
Kathleen J. Affeldt	17,181	*
Wesley K. Clark(19)	14,572	*
Robert J. Dellinger	17,866	*
Kenneth E. Homa(20)	103,017	*
Edward H. Orzetti	17,133	*
Sir Jeremy Mackenzie(21)	300	*
Richard J. Schnall(6)	—	—
Carl T. Stocker	22,795	*
All directors and executive officers as a group (24 persons)(22)	2,599,455	4.50	%

*

Less than 1%

(1)

In accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended, a person is deemed a "beneficial owner" of a security if he or she has or shares the power to vote or direct the voting of such security or the power to dispose or direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities which that person has the right to acquire beneficial ownership of within 60 days. More than one person may be deemed to be a beneficial owner of the same securities. Each of such stockholders has sole voting and investment power as to the shares unless otherwise noted.

(2)

CD&R Associates V Limited Partnership, a Cayman Islands exempted limited partnership, is the general partner of Clayton, Dubilier & Rice Fund V Limited Partnership and has the power to direct Clayton, Dubilier & Rice Fund V Limited Partnership as to the voting and disposition of shares held by Clayton, Dubilier & Rice Fund V Limited Partnership. CD&R Investment Associates II, Inc., a Cayman Island exempted company, is the managing general partner of CD&R Associates V Limited Partnership and has the power to direct CD&R Associates V Limited Partnership as to its direction of Clayton, Dubilier & Rice Fund V Limited Partnership's voting and disposition of the shares held by Clayton, Dubilier & Rice Fund V Limited Partnership. No person controls the voting and disposition of CD&R Investment Associates II, Inc. with respect to the shares owned by Clayton, Dubilier & Rice Fund V Limited Partnership. Each of CD&R Associates V Limited Partnership and CD&R Investment Associates II, Inc. expressly disclaims beneficial ownership of the shares owned by Clayton, Dubilier & Rice Fund V Limited Partnership. The business address for each of Clayton, Dubilier & Rice Fund V Limited Partnership, CD&R Associates V Limited Partnership and CD&R Investment Associates II, Inc. is 1403 Foulk Road, Suite 106, Wilmington, Delaware 19803.

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(3)

CD&R Associates VI Limited Partnership, a Cayman Islands exempted limited partnership, is the general partner of Clayton, Dubilier & Rice Fund VI Limited Partnership and has the power to direct Clayton, Dubilier & Rice Fund VI Limited Partnership as to the voting and disposition of shares held by Clayton, Dubilier & Rice Fund VI Limited Partnership. CD&R Investment Associates VI, Inc., a Cayman Island exempted company, is the general partner of CD&R Associates VI Limited Partnership and has the power to direct CD&R Associates VI Limited Partnership as to its direction of Clayton, Dubilier & Rice Fund VI Limited Partnership's voting and disposition of the shares held by Clayton, Dubilier & Rice Fund VI Limited Partnership. No person controls the voting and disposition of CD&R Investment Associates VI, Inc. with respect to the shares owned by Clayton, Dubilier & Rice Fund VI Limited Partnership. Each of CD&R Associates VI Limited Partnership and CD&R Investment Associates VI, Inc. expressly disclaims beneficial ownership of the shares owned by Clayton, Dubilier & Rice Fund VI Limited Partnership. The business address for each of Clayton, Dubilier & Rice Fund VI Limited Partnership, CD&R Associates VI Limited Partnership and CD&R Investment Associates VI, Inc. is 1403 Foulk Road, Suite 106, Wilmington, Delaware 19803.

(4)

Includes 2,773,116 shares issuable to Exel International Holdings (Netherlands 2) BV, formerly known as NFC International Holdings (Netherlands II) upon exercise of the warrant received by Exel as part of the consideration for the sale of the Allied business. The business address for Exel International Holdings (Netherlands 2) is Huygensweg 10, 5460 AC, Veghel, The Netherlands.

(5)

Includes 133,140 shares issuable to Mr. Kelley upon exercise of options exercisable within 60 days.

(6)

Does not include 32,221,750 shares owned by Clayton, Dubilier & Rice Fund V Limited Partnership or 13,394,422 shares owned by Clayton, Dubilier & Rice Fund VI. Messrs. Rogers and Schnall may be deemed to share beneficial ownership of the shares owned of record by Clayton, Dubilier & Rice Fund V Limited Partnership by virtue of their status as stockholders of CD&R Investment Associates II, Inc., the managing general partner of CD&R Associates V Limited Partnership, and by Clayton, Dubilier & Rice Fund VI Limited Partnership by virtue of their status as stockholders of CD&R Investment Associates VI, Inc., the general partner of CD&R Associates VI Limited Partnership. However, each of Messrs. Rogers and Schnall expressly disclaims beneficial ownership of the shares owned by Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership, respectively.

(7)

Includes 25,360 shares issuable to Mr. Christensen upon exercise of options exercisable within 60 days.

(8)

Includes 28,530 shares issuable to Mr. Dupuy upon exercise of options exercisable within 60 days.

(9)

Includes 145,236 shares issuable to Mr. Fergus upon exercise of options exercisable within 60 days.

(10)

Includes 110,873 shares issuable to Mr. Ford upon exercise of options exercisable within 60 days.

(11)

Includes 12,680 shares issuable to Mr. Gathany upon exercise of options exercisable within 60 days.

(12)

Includes 22,766 shares issuable to Mr. Kingston upon exercise of options exercisable within 60 days.

(13)

Includes 179,907 shares issuable to Mr. Milewski upon exercise of options exercisable within 60 days.

(14)

Includes 28,025 shares issuable to Mr. Pickford upon exercise of options exercisable within 60 days.

(15)

Includes 25,360 shares issuable to Mr. Rosing upon exercise of options exercisable within 60 days.

(16)

Includes 22,190 shares issuable to Mr. Schorr upon exercise of options exercisable within 60 days.

(17)

Includes 19,739 shares issuable to Mr. Thompson upon exercise of options exercisable within 60 days.

(18)

Includes 46,218 shares issuable to Mr. Writt upon exercise of options exercisable within 60 days.

(19)

General Clark resigned as a Director of our company effective October 7, 2003.

(20)

Includes 6,488 deferred shares held pursuant to the SIRVA, Inc. Directors Compensation Plan. Mr. Homa resigned as a Director of our company effective October 13, 2003.

(21)

Includes 123 deferred shares held pursuant to the SIRVA, Inc. Directors Compensation Plan.

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(22)

Includes 800,024 shares issuable upon exercise of options exercisable within 60 days and 6,611 deferred shares held pursuant to the SIRVA, Inc. Directors Compensation Plan.

SELLING STOCKHOLDERS

        The following table lists all shares of our common stock that, as of September 30, 2003, were beneficially owned by the selling stockholders participating in the offering.

        The selling stockholders are offering a total of 7,894,737 shares in this offering, assuming no exercise of the over-allotment option held by the underwriters. Because the selling stockholders may in fact sell all, some or none of their shares in the offering, no definitive estimate as to the number of shares that will be held by the selling stockholders after the offering can be provided and the following table has been prepared based on the assumption that all shares offered under this prospectus will be sold. For a description of the over-allotment option, see "Underwriting." The selling stockholders may be deemed to be underwriters within the meaning of the Securities Act of 1933.

			Shares Outstanding After the Offering
10% Beneficial Owner(1)	Shares Outstanding Before the Offering	Shares to be sold in the Offering
			Number	Percent
Clayton, Dubilier & Rice Fund V Limited Partnership(2)	32,221,750	4,727,543	27,494,207	39.23	%
Clayton, Dubilier & Rice Fund VI Limited Partnership(3)	13,394,422	1,965,216	11,429,206	16.31	%
Exel International Holdings (Netherlands 2) BV(4)	10,105,294	1,075,769	9,029,525	12.39	%
Executive Officer or Director
Kenneth E. Homa(5)	103,017	15,114	87,903	*
Carl T. Stocker(6)	22,795	3,344	19,451	*
Management Selling Stockholders as a group (11 persons)(7)	384,489	20,366	364,123	*
Agent Selling Stockholders as a group (32 persons)(8)	486,300	56,812	429,488	*
Other Selling Stockholders as a group (6 persons)(9)	208,395	30,573	177,822	*

*

Less than 1%

(1)

In accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended, a person is deemed a "beneficial owner" of a security if he or she has or shares the power to vote or direct the voting of such security or the power to dispose or direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities which that person has the right to acquire beneficial ownership of within 60 days. More than one person may be deemed to be a beneficial owner of the same securities. Each of such stockholders has sole voting and investment power as to the shares unless otherwise noted.

(2)

Two of our directors, James W. Rogers and Richard J. Schnall, are principals of entities affiliated with Clayton, Dubilier & Rice Fund V Limited Partnership. See "Certain Relationships and Related Transactions—Investment Funds Managed by Clayton, Dubilier & Rice, Inc." for a description of relationships and transactions with Clayton, Dubilier & Rice Fund V Limited Partnership and its affiliates and associates. If the underwriters exercise their over-allotment option in full, Clayton, Dubilier & Rice Fund V Limited Partnership will sell an additional 1,891,016 shares of our common stock.

(3)

Two of our directors, James W. Rogers and Richard J. Schnall, are principals of entities affiliated with Clayton, Dubilier & Rice Fund VI Limited Partnership. See "Certain Relationships and Related Transactions—Investment Funds Managed by Clayton, Dubilier & Rice, Inc." for a description of relationships and transactions with Clayton, Dubilier & Rice Fund VI Limited Partnership and its affiliates and associates. If the

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underwriters exercise their over-allotment option in full, Clayton, Dubilier & Rice Fund VI Limited Partnership will sell an additional 786,086 shares of our common stock.

(4)

Includes 2,773,116 shares issuable to Exel International Holdings (Netherlands 2) BV, formerly known as NFC International Holdings (Netherlands II) upon exercise of the warrant received by Exel as part of the consideration for the sale of the Allied business, which warrant will not be sold in the offering. We purchased the Allied and Pickfords businesses from Exel in 1999. See "Certain Relationships and Related Transactions—Exel plc" for a description of our relationships with Exel. If the underwriters exercise their over-allotment option in full, Exel International Holdings (Netherlands 2) BV will sell an additional 430,307 shares of our common stock.

(5)

Includes 6,488 deferred shares held pursuant to the SIRVA, Inc. Directors Compensation Plan. Mr. Homa resigned as a Director of our company effective October 13, 2003. If the underwriters exercise their over-allotment option in full, Mr. Homa will sell an additional 6,045 shares of our common stock.

(6)

Mr. Stocker is a Director of our company. See "Management—Directors and Executive Officers." If the underwriters exercise their over-allotment option in full, Mr. Stocker will sell an additional 1,337 shares of our common stock.

(7)

Includes 177,802 shares issuable upon exercise of options exercisable within 60 days, none of which will be sold in the offering. Each of these selling stockholders is a member of our management and purchased stock through one or more of our various management equity offerings. See "Certain Relationships and Related Transactions" for a description of these offerings. These selling stockholders hold in the aggregate less than 1% of our common stock. None of the executive officers are included in this group of selling stockholders. If the underwriters exercise their over-allotment option in full, these selling stockholders will sell an additional 8,145 shares of our common stock.

(8)

Includes 15,088 shares issuable to these selling stockholders upon the exercise of options exercisable within 60 days. These options were issued in connection with our acquisition of Moveline occurring on December 31, 2001. See "Certain Relationships and Related Transactions." Each of these selling stockholders is an individual associated with a member of our branded network of agents and purchased stock through one or more of our offerings to accredited investors. See "Business—Global Relocation Solutions" for a description of our business arrangements with members of our agent network, and "Certain Relationships and Related Transactions" for a description of these offerings. These selling stockholders hold in the aggregate less than 1% of our common stock. If the underwriters exercise their over-allotment option in full, these selling stockholders will sell an additional 22,730 shares of our common stock.

(9)

Each of these purchased stock through one or more of our offerings to accredited investors. See "Certain Relationships and Related Transactions" for a description of these offerings. These selling stockholders have been directors or officers of other companies in which Clayton, Dubilier & Rice Fund V Limited Partnership, Clayton, Dubilier & Rice Fund VI Limited Partnership or their affiliates invests or are persons with whom Clayton, Dubilier & Rice and its other affiliates or associates have personal or other relationships. These selling stockholders hold in the aggregate less than 1% of our common stock. If the underwriters exercise their over-allotment option in full, these selling stockholders will sell an additional 12,228 shares of our common stock.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Investment Funds Managed by Clayton, Dubilier & Rice, Inc.

        Overview.    Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership own 56.6% and 23.5% of our outstanding common stock, respectively. They are private investment funds managed by Clayton, Dubilier & Rice, Inc.

        The general partner of Clayton, Dubilier & Rice Fund V Limited Partnership is CD&R Associates V Limited Partnership, a Cayman Islands exempted limited partnership. CD&R Associates V Limited Partnership has three general partners. The managing general partner of CD&R Associates V Limited Partnership is CD&R Investment Associates II, Inc., a Cayman Islands exempted company. The other general partners of CD&R Associates V Limited Partnership are CD&R Cayman Investment Associates, Inc., a Cayman Islands exempted company, and CD&R Investment Associates, Inc., a Delaware corporation. Under the partnership agreement of CD&R Associates V Limited Partnership, all management authority (other than with respect to the amendment of the partnership agreement) is vested in CD&R Investment Associates II, Inc.

        The general partner of Clayton, Dubilier & Rice Fund VI Limited Partnership is CD&R Associates VI Limited Partnership, a Cayman Islands exempted limited partnership. CD&R Associates VI Limited Partnership has a general partner, CD&R Investment Associates VI, Inc., a Cayman Islands exempted company.

        Two of our directors, James W. Rogers and Richard J. Schnall, are principals of Clayton, Dubilier & Rice, Inc., limited partners of CD&R Associates V Limited Partnership and CD&R Associates VI Limited Partnership, and stockholders and directors of CD&R Investment Associates II, Inc. and CD&R Investment Associates VI, Inc.

        Clayton, Dubilier & Rice, Inc. is a private investment firm organized as a Delaware corporation. Clayton, Dubilier & Rice, Inc. is the manager of a series of investment funds, including Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership. Clayton, Dubilier & Rice, Inc. generally assists in structuring, arranging financing for and negotiating the transactions with companies in which the funds it manages invest. After the consummation of such transactions, Clayton, Dubilier & Rice, Inc. generally provides management and financial consulting services to the companies. Such services include helping companies to establish effective banking, legal and other business relationships and assisting management in developing and implementing strategies for improving their operational, marketing and financial performance.

        Consulting Agreement.    SIRVA, North American Van Lines and Clayton, Dubilier & Rice, Inc. are parties to an Amended and Restated Consulting Agreement, dated as of January 1, 2001, pursuant to which Clayton, Dubilier & Rice, Inc. provides us with financial advisory and management consulting services. We pay Clayton, Dubilier & Rice, Inc. a management fee of $1.0 million annually, which we review on an annual basis. For each of the years ended December 31, 2002 and 2001, we paid Clayton, Dubilier & Rice, Inc. an additional $0.375 million in connection with the services provided by Mr. Rogers as our President and Chief Executive Officer from his election in April 2001 until Brian P. Kelley was named President and Chief Executive Officer in August 2002. Mr. Rogers received no compensation for his services as President and Chief Executive Officer. The consulting agreement will continue to be in effect after the offering and therefore, Clayton, Dubilier & Rice, Inc. will be entitled to receive fees, including financial advisory fees, in the future.

        Indemnification Agreement.    SIRVA, North American Van Lines, Clayton, Dubilier & Rice, Inc. and Clayton, Dubilier & Rice Fund V Limited Partnership have entered into an Indemnification Agreement, dated as of March 30, 1998, pursuant to which we have agreed to indemnify Clayton, Dubilier & Rice, Inc., Clayton, Dubilier & Rice Fund V Limited Partnership, any other investment vehicle managed by Clayton, Dubilier & Rice, Inc., their respective directors, officers, partners, employees, agents and controlling persons, against certain liabilities arising under federal securities laws, liabilities arising out of the performance of the consulting agreement and certain other claims and liabilities.

        Stock Subscription Agreements.    Clayton, Dubilier & Rice Fund V Limited Partnership organized us in March 1998 to purchase North American Van Lines. It subscribed for 19,497,086 shares of our common stock for an aggregate purchase price of $61.5 million pursuant to a Stock Subscription Agreement, dated as of March 30, 1998. Pursuant to that agreement, Clayton, Dubilier & Rice Fund V Limited Partnership may designate all but one

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of the members of our Board of Directors. Exel has the right to designate the remaining member of our Board of Directors pursuant to an agreement discussed below. Clayton Dubilier & Rice Fund V Limited Partnership is also entitled to consult with us with respect to our operations at any time, to have observers attend meetings of our Board of Directors and those of certain of our subsidiaries, and to receive all our quarterly and annual financial reports and budgets, as well as other documents. In addition, the stock subscription agreement imposes certain restrictions on the transfer of the shares of our common stock owned by Clayton, Dubilier & Rice Fund V Limited Partnership.

        On December 1, 1999, pursuant to a Stock Subscription Agreement, dated as of November 19, 1999, Clayton, Dubilier & Rice Fund V Limited Partnership purchased an additional 7,143,658 shares of our common stock for an aggregate purchase price equal to $32.0 million. The stock subscription agreement imposes certain restrictions on the transfer of the shares of common stock purchased under the agreement. The proceeds of this stock subscription were used to repay a portion of the $40.0 million interim loan we incurred in connection with the acquisition of the Allied and Pickfords businesses.

        On April 12, 2002 and May 3, 2002, pursuant to a Stock Subscription Agreement, dated April 12, 2002, Clayton, Dubilier & Rice Fund VI Limited Partnership purchased 4,464,818 and 8,929,604 shares of our common stock, respectively, for aggregate purchase prices of $20.0 million and $40.0 million, respectively. Pursuant to that agreement, Clayton, Dubilier & Rice Fund VI Limited Partnership is entitled to consult with us with respect to our operations at any time, to have observers attend meetings of our Board of Directors and those of certain of our subsidiaries, and to receive all our quarterly and annual financial reports and budgets, as well as other documents. In addition, the stock subscription agreement imposes certain restrictions on the transfer of the shares of our common stock owned by Clayton, Dubilier & Rice Fund VI Limited Partnership. The proceeds of the April subscription were used to fund a portion of the purchase price for the purchase of the business conducted by National Association of Independent Truckers, Inc. and its affiliate, VCW, Inc., a leading provider of insurance services to independent contract truck drivers. The proceeds of the May subscription were used to fund a portion of the purchase price for the purchase of CRS, the business that provides comprehensive relocation services to companies and their employees, including home sale services, relocation coordination services and mortgage lending services. Upon the closing of this offering, the director designation, observer and other rights granted to Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership under the Stock Subscription Agreements described above will terminate.

        We have not adopted formal procedures to specifically protect the interests of our minority stockholders in relation to future transactions with our principal stockholders. However, our board of directors has adopted corporate governance guidelines, which require each director to avoid taking actions or having interests that might result in a conflict of interest with our interests. Each director is required to ethically handle all actual or apparent conflicts of interest between personal and professional relationships, including promptly informing the corporate secretary if such a conflict arises and recusing himself or herself from any discussion or decision affecting his or her personal interests. Accordingly, our directors who are employees of Clayton, Dubilier & Rice, Inc., will be required to recuse themselves from any discussion or decision regarding any transaction with our principal stockholders. These guidelines do not, by themselves, prohibit transactions with our principal stockholders.

        Senior Discount Loan.    On November 19, 1999, we incurred $35.0 million initial value of unsecured senior discount term loan borrowings in connection with the acquisition of the Allied and Pickfords businesses. In November 2002, the lenders, J.P. Morgan Securities Inc. (formerly known as Chase Securities Inc.), Blue Ridge Investments, LLC and Mt. Mitchell Capital Funding, LLC, assigned the senior discount loan to Arawak, Ltd., a wholly owned subsidiary of Clayton, Dubilier & Rice Fund VI Limited Partnership. The senior discount loan accretes at a rate of 16.0% per annum from its initial value of $35.0 million at November 19, 1999. Such amount had accreted to $63.5 million as of September 30, 2003 and will accrete until December 1, 2004. Thereafter, the senior discount notes will bear interest at a rate of 16.0% per annum, payable semi-annually, and will be unsecured obligations without the benefit of guarantees. We intend to apply a portion of the net proceeds of this offering to redeem the senior discount debt.

        Moveline.    In August 2000, we organized Moveline, Inc. with Clayton, Dubilier & Rice Fund V Limited Partnership to provide home and office relocation products and services to individuals, businesses, agents and

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drivers primarily through the internet. Pursuant to a Contribution and Subscription Agreement, dated August 11, 2000, we contributed certain assets to Moveline, Inc. in exchange for nonvoting convertible preferred stock representing 30.0% of the initially fully diluted capital stock of Moveline. Clayton, Dubilier & Rice Fund V Limited Partnership invested $25.0 million in cash for approximately 50.0% of the initial fully diluted capital stock of Moveline. The remaining 20.0% of Moveline's capital stock was reserved for issuance to Moveline management and third-party business partners.

        On December 31, 2001, we acquired Moveline by merging it into one of our wholly-owned subsidiaries, with our subsidiary as the surviving corporation, pursuant to an Agreement and Plan of Merger, dated as of November 9, 2001. Immediately following the merger, we contributed the surviving subsidiary to Allied Van Lines, Inc., another of our wholly owned subsidiaries. Allied Van Lines subsequently merged with that subsidiary with Allied Van Lines as the surviving corporation. Under the agreement and plan of merger, Moveline's stockholders received a fraction of a share of our common stock for each Moveline share acquired in the merger. As a result, we issued to Clayton, Dubilier & Rice Fund V Limited Partnership an additional 5,581,006 shares of our common stock, with an aggregate value of $25.0 million at that time, in connection with the merger.

Exel plc

        Overview.    On November 19, 1999, we purchased the Allied and Pickfords businesses from Exel plc pursuant to an Acquisition Agreement, dated as of September 14, 1999. In consideration for the acquisition, we paid Exel $418.1 million in cash and issued to Exel International Holdings (Netherlands 2) BV, formerly known as NFC International Holdings (Netherlands II), an affiliate of Exel, 5,546,263 shares of our common stock, representing approximately 20.0% of our then fully-diluted common stock, 24,500 shares of our junior exchangeable preferred stock, and a warrant to purchase 2,773,116 shares of our common stock. To finance a portion of the purchase price, we incurred a $40.0 million interim loan, a portion of which was repaid with the proceeds of a stock subscription by Exel International Holdings (Netherlands 2). In addition, we entered into various arrangements with Exel to provide each other with various vehicle and real property services and leases or subleases of several pieces of real property.

        Letter Agreement.    In connection with the issuance of 5,546,263 shares of our common stock to Exel International Holdings (Netherlands 2) pursuant to the acquisition agreement, we entered into a letter agreement with Exel which gives Exel the right, so long as it and any of its affiliates hold at least 10% of the outstanding shares of our capital stock determined as if all shares issuable under the warrant were issued and outstanding and held by Exel International Holdings (Netherlands 2), to nominate one director to our Board of Directors. The agreement also imposes certain restrictions on the transfer of the 5,546,263 shares of our common stock held by Exel International Holdings (Netherlands 2), such as rights of first refusal and drag-along rights. These restrictions on transfer will terminate upon the closing of this offering.

        Junior Exchangeable Preferred Stock.    The 24,500 shares of our junior preferred stock issued to Exel International Holdings (Netherlands 2) had an initial aggregate liquidation preference of $24.5 million and, as of September 30, 2003, an aggregate liquidation preference of $32.1 million. The dividend rate on this junior preferred stock is 12.4% compounded quarterly, although the payment of dividends is subject to the discretion of our Board of Directors. Our ability to pay dividends is subject to our various debt agreements, including the indenture and the senior credit facility. In limited circumstances, we have the option to exchange the junior preferred stock for subordinated exchange debentures. Subject to the terms of our debt agreements, the junior preferred stock is required to be redeemed on the eleventh anniversary of its issue date or upon the occurrence of certain other events. In addition, we have the right, subject to the terms of our debt agreements, to redeem the junior preferred stock at any time after the first anniversary of its issue date. We intend to apply a portion of the net proceeds of this offering to redeem the junior preferred stock.

        Warrant.    The warrant that we issued to Exel International Holdings (Netherlands 2) BV entitles the holder to purchase 2,773,116 shares of our common stock at an exercise price of $12.62 per share. The warrant expires on November 19, 2004 and contains customary anti-dilution protections. In addition, the warrant and any shares issued upon its exercise are subject to certain transfer restrictions, including rights of first refusal and drag-along rights in

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our favor and in favor of Clayton, Dubilier & Rice Fund V Limited Partnership and hold-back covenants. The rights of first refusal and drag-along rights will terminate upon the closing of this offering.

        Other Services.    In connection with the acquisition of the Allied and Pickfords businesses, Exel and its affiliates agreed to provide certain vehicle and real property services to us. In addition, there are a number of properties in the United Kingdom which are used both for operations of the moving services businesses we acquired and also for operations of other businesses of Exel which Exel retained. Certain subsidiaries of Exel lease or sublease portions of those facilities, which we acquired in connection with the acquisition of the Allied and Pickfords businesses. Similarly, in the case of the shared sites which we acquired in connection with that acquisition, Pickfords Limited leases or subleases to certain Exel entities portions of those facilities for their use. The terms of these leasing and subleasing arrangements range from less than one year to up to fifteen years and are generally at market rents and conditions.

        Stock Subscription Agreement.    On December 1, 1999, Exel International Holdings (Netherlands 2) purchased 1,785,915 shares of our common stock for an aggregate purchase price of $8.0 million pursuant to a Stock Subscription Agreement, dated as of November 19, 1999. The stock subscription agreement imposes certain restrictions on the transfer of the shares of common stock purchased under that agreement. The proceeds of this stock subscription were used to repay a portion of the $40.0 million interim loan we incurred in connection with the acquisition of the Allied and Pickfords businesses.

Agreements with Our Management and Other Investors

        Management Equity Offerings.    In connection with our acquisition of North American Van Lines in 1998 and the acquisition of the Allied and Pickfords businesses in November 1999, we offered and sold shares of our common stock and granted options to purchase such shares to certain members of our management and the management of our subsidiaries pursuant to the SIRVA, Inc. Stock Incentive Plan. We have made several additional management equity offerings in each year since 2000. As of September 30, 2003, 103 members of management collectively owned 2,093,662 shares of such stock and had been granted options to purchase 4,560,072 additional shares of such stock pursuant to these management equity offerings.

        Management Loans.    Certain members of our and our subsidiaries' management borrowed money from a third party lender to fund their investments in us. North American Van Lines guarantees loans in an aggregate principal amount of $1.3 million as of September 30, 2003, made by the third-party lender to 18 members of our and our subsidiaries' management, including one of our executive officers. North American Van Lines would become liable for such amounts in the event that a member of management fails to pay the principal and interest when due. These loans mature in May 2004 and bear interest at the prime rate plus 1.0%. These loans include one loan made by the third-party lender and guaranteed by North American Van Lines to one of our executive officers, Todd W. Schorr. Mr. Schorr borrowed $159,750 to purchase 47,550 shares of our common stock. As of September 30, 2003, Mr. Schorr owed $161,788 to the third-party lender. The loan to our executive officer was made prior to the passage of the Sarbanes-Oxley Act. Subsequent to its passage, we adopted a policy prohibiting us and our subsidiaries from making loans to or guaranteeing loans of executive officers.

        Other Stockholder Offerings.    We offered holders of our common stock, including members of management and directors, who were accredited investors the opportunity to purchase additional shares in connection with Clayton, Dubilier & Rice Fund V's Limited Partnership subscription for 7,143,658 shares of our common stock under the Stock Subscription Agreement, dated November 19, 1999. Certain of these holders purchased a total of 208,015 shares on February 11, 2000.

        We offered holders of our common stock who were accredited investors, including members of management and directors, the opportunity to purchase, on a pro rata basis, additional shares of our common stock, in connection with the stock subscriptions made by Clayton, Dubilier & Rice Fund VI Limited Partnership on April 12 and May 3, 2002, pursuant to the Stock Subscription Agreement, dated as of April 12, 2002. Certain of these accredited investors purchased a total of 245,611 shares on July 30, 2002.

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Registration and Participation Agreement

        Registration Rights.    Each holder of shares of our common stock and options to purchase shares of our common stock, including executive officers and key employees, are entitled to the following registration rights for the shares of common stock held by them or issuable upon exercise of options to purchase our common stock under a Registration and Participation Agreement, dated as of March 30, 1998, among SIRVA, Clayton, Dubilier & Rice Fund V Limited Partnership, and Exel plc, as amended:

•

holders constituting, at any time prior to our initial public offering, at least 50% and thereafter, at least 20%, of the total shares of these registrable securities may request that we use our best efforts to register such securities for public resale,



•

if we register any common stock at any time, either for our account or for the account of any stockholder, including in connection with this offering, the holders of registrable securities are entitled to request that we use our best efforts to include the number of their shares of common stock, which in the opinion of the underwriters, can be sold, and



•

Exel has the right to make two demands that we register all of their registrable securities so long as it and its affiliate own at least 3,666,105 shares of our common stock.

        In most cases, we will bear all registration expenses (other than underwriting discounts), including the fees and expenses of counsel to the selling stockholders. Because only Clayton, Dubilier & Rice Fund V Limited Partnership holds more than 50% of our outstanding common stock, it is the only shareholder able to initiate the initial registration by itself. Further, members of management generally do not have registration rights under the Registration and Participation Agreement for shares of our common stock issued upon exercise of options if we have registered such shares under the Securities Act.

        If we file a registration statement under the Securities Act with respect to a public offering of our common stock, no holders of our common stock are permitted to effect any public sale or distribution of any shares of such stock during the 20 days before and the 180 days after the effective date of the registration statement (other than as part of the public offering).

        Participation Rights.    Exel or an affiliate of Exel has the right to purchase, on a pro rata basis, additional shares of our common stock if Clayton, Dubilier & Rice Fund V Limited Partnership or any other investment vehicle managed by Clayton, Dubilier & Rice, Inc., including Clayton, Dubilier & Rice Fund VI Limited Partnership, subscribes for additional shares of our common stock.

Other Arrangements

        On July 1, 2002, we entered into a ten-year purchase commitment with Covansys Corporation and Affiliated Computer Services, Inc. to provide selected outsourcing services for our domestic information systems infrastructure, including data center operations and telecommunications and certain application software development. Covansys Corporation is a related party, as 24.5% of its outstanding common stock is owned by Clayton, Dubilier & Rice Fund VI Limited Partnership. As of September 30, 2003, the remaining total purchase commitment was $163.3 million. We paid $3.0 million and $5.4 million to Covansys for the year ended December 31, 2002, and the nine months ended September 30, 2003, respectively.

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DESCRIPTION OF OUR INDEBTEDNESS

Overview

        In connection with the acquisition of the Allied and Pickfords businesses, North American Van Lines entered into a senior credit agreement that provided for senior secured credit facilities consisting of two term loan facilities, under which $313.3 million in borrowings is currently outstanding, and a revolving credit facility providing up to $150.0 million in revolving credit commitments. In connection with the same acquisition, North American Van Lines also completed an offering of $150.0 million principal amount of 13³/8% senior subordinated notes due 2009 and SIRVA incurred $35.0 million initial value of unsecured senior discount term loan borrowings.

        In connection with this offering, we intend to effect a refinancing of the existing senior credit facility of our wholly-owned subsidiary, North American Van Lines, with a new senior credit facility for SIRVA Worldwide, Inc. and one or more of our other subsidiaries. Upon consummation of this refinancing, although our total debt is expected to decrease by $165.3 million, we expect that the borrowers thereunder will have outstanding borrowings under the new senior credit facility of $459.7 million, representing an increase of $64.4 million, as of September 30, 2003. Of these borrowings, we expect that $425.0 million will be in the form of a term loan and $34.7 million will be drawn initially under the $175.0 million revolving portion of the new senior credit facility. As a result of this refinancing, we expect to realize significantly lower interest expense.

        We have commenced a tender offer for all of the 13³/8% senior subordinated notes due 2009 issued by North American Van Lines. We will use the net proceeds from this Offering and borrowings under the new senior credit facility to finance the note repurchase. To the extent that we purchase less than all of the senior subordinated notes under the tender offer, our initial borrowings under the revolving portion of the new senior credit facility will be less than currently anticipated. In connection with the tender offer, North American Van Lines has received the requisite consents to remove substantially all of the restrictive covenants and certain other provisions from the indenture governing its senior subordinated notes. As of October 31, 2003, approximately 93% of the notes had been tendered.

        See "Internal Reorganization and Refinancing", "Use of Proceeds" and "Capitalization".

        The new senior credit facility, existing credit facility, senior discount term loans and senior subordinated notes are described in greater detail below.

New Senior Credit Facilities

        General.    Pursuant to letters dated October 15, 2003, JPMorgan Chase Bank, Bank of America, N.A., Credit Suisse First Boston, Deutsche Bank Trust Company Americas, Goldman Sachs Credit Partners L.P. and Citicorp North America, Inc. and certain of their affiliates have committed to provide, or arrange for a syndicate of lenders to provide, the new senior credit facilities, subject to certain conditions. Under the terms of those commitments, North American Van Lines and/or one or more of its foreign subsidiaries were to be the borrower under the new senior credit facilities. In connection with the planned internal reorganization, we are in discussions with the lenders to provide that SIRVA Worldwide, Inc. will be the primary borrower under the new senior credit facility, with one or more of its foreign subsidiaries to be additional borrowers. SIRVA Worldwide, Inc. or North American Van Lines, as the case may be, is referred to in this summary of the new senior credit facilities as the "parent borrower" and together with any such foreign subsidiaries are collectively referred to in this summary of the new senior credit facilities as the "borrowers."

        The new senior credit facilities are expected to provide for aggregate maximum borrowings of $600.0 million under (1) a term loan facility providing for term loans in an aggregate principal amount of $425.0 million, and (2) a revolving credit facility, providing for up to $175.0 million in revolving loans to the borrowers (including standby and commercial letters of credit) outstanding at any time. In connection with the consummation of this offering and the anticipated use of proceeds of this offering, assuming the repurchase of substantially all of North American Van Lines's existing senior subordinated notes, approximately $425.0 million is expected to be drawn under the term loan facility and approximately $34.7 million is expected to be drawn under the revolving credit facility. Undrawn

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amounts under the revolving credit facility will be available on a revolving credit basis for general corporate purposes of the borrowers and their respective subsidiaries.

        Availability.    The availability of the new senior credit facilities is expected to be subject to various conditions precedent including, but not limited to:

•

the consummation of this offering for gross proceeds to SIRVA of at least $200.0 million;



•

the repayment, redemption or repurchase of (1) North American Van Lines's existing senior secured credit facilities and seller notes; (2) SIRVA's senior discount loan and junior exchangeable preferred stock; and (3) all existing senior subordinated notes of North American Van Lines tendered in connection with the planned tender offer for all such notes;



•

the receipt of material government and third party consents and approvals;



•

the absence of material pending or threatened litigation or proceedings; and



•

other conditions precedent typical of senior secured loans.

        The commitments to provide the new senior credit facilities are also subject to, among other things, the absence of any material adverse change with respect to SIRVA, the absence of any material disruption of or material adverse change in conditions in the financial, banking or capital markets that would materially impair the syndication of the new credit facilities, and the negotiation, execution and delivery of definitive financing documentation for the new credit facilities.

        Maturity; Prepayments.    The term loans are expected to mature in 2010, and the revolving credit facility is expected to mature in 2009. Amortization of the principal amount of the term loans is expected to be on an installment schedule to be determined, with no substantial amortization of the term loans until the final year prior to maturity. Subject to certain exceptions, the new senior credit facilities are expected to be subject to mandatory prepayment and reduction in an amount equal to the net proceeds of:

•

any U.S. receivables securitization program;



•

certain debt offerings by the parent borrower and its subsidiaries; and



•

certain asset sales by the parent borrower and its subsidiaries.

        Security; Guaranty.    The obligations of the borrowers under the new senior credit facilities are expected to be guaranteed by the parent borrower, each of its existing and subsequently acquired or organized domestic subsidiaries and any foreign subsidiary borrowers and their subsidiaries (other than any special purpose receivables subsidiary and certain immaterial subsidiaries). In addition, the new senior credit facilities and the guarantees thereunder are expected to be secured by security interests in and pledges of or liens on substantially all the material tangible and intangible assets of the borrowers and the guarantors, including pledges of all the capital stock of certain direct or indirect domestic subsidiaries of the parent borrower and of up to 65% of the capital stock of each direct foreign subsidiary of the parent borrower or its domestic subsidiaries.

        Interest.    At the borrowers' election, the interest rates per annum applicable to the loans under the new senior credit facilities are expected to be a fluctuating rate of interest measured by reference to either (1) an adjusted London inter-bank offered rate, or LIBOR, plus a borrowing margin or (2) an alternate base rate, or ABR, plus a borrowing margin.

        Fees.    Subject to the consummation of this offering and the related refinancing transactions, the parent borrower is expected to agree to pay certain fees with respect to the new credit facilities, including (1) fees on the unused commitments of the lenders, (2) letter of credit fees on the aggregate face amount of outstanding letters of credit plus a fronting bank fee for the letter of credit issuing bank, (3) quarterly administration fees and (4) arrangement and other similar fees.

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        Covenants.    The new senior credit facilities are expected to contain a number of covenants that, among other things, would limit or restrict the ability of the parent borrower and its subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, change the business conducted by the parent borrower and its subsidiaries, or engage in certain transactions with affiliates. In addition, under the new senior credit facilities, the parent borrower is expected to be required to comply with specified financial ratios and tests, including a minimum interest expense coverage ratio, a maximum leverage ratio and maximum capital expenditures.

        Events of Default.    The new senior credit facilities are expected to contain customary events of default including non-payment of principal, interest or fees, failure to comply with covenants, inaccuracy of representations or warranties in any material respect, cross default to certain other indebtedness, loss of lien perfection or priority, material judgments and change of ownership or control.

Senior Secured Credit Facilities

        General.    North American Van Lines entered into a senior credit agreement with a syndicate of financial institutions, with JPMorgan Chase Bank as administrative agent and Banc of America Securities LLC as syndication agent. The following summary is a description of the principal terms of the senior credit agreement, as amended, and the related documents governing the facility and is subject to and qualified in its entirety by reference to such governing documents. The senior credit agreement governing the facility and all amendments to that credit agreement to date have been filed as exhibits to the registration statement of which this prospectus is a part. It is available as set forth under the heading "Where You Can Find More Information."

        The senior credit agreement originally provided for senior secured credit facilities in an aggregate principal amount of up to $475.0 million, consisting of:

•

a revolving credit facility in providing for up to $150.0 million in revolving credit commitments,



•

the Tranche A Term Loan, a seven-year term loan of $150.0 million, and



•

the Tranche B Term Loan, an eight-year term loan of $175.0 million.

        In connection with the purchase of CRS, the relocation services business of Cooperative Resource Services on May 3, 2002, North American Van Lines borrowed an additional $50.0 million under the Tranche B Term Loan facility.

        Use of Facility.    In connection with the closing of the acquisition of the Allied and Pickfords businesses, North American Van Lines used the initial term loans and borrowed under the revolving credit facility to refinance certain existing indebtedness and to finance a portion of the purchase price for the acquisition of the Allied and Pickfords businesses. In connection with the purchase of CRS, North American Van Lines used the additional $50.0 million borrowed under the Tranche B Term Loan facility to fund a portion of the purchase price for the acquired business, to refinance certain existing indebtedness of the acquired business, and to refinance existing indebtedness under the revolving credit facility. The unused commitments under the revolving credit facility are available to North American Van Lines and certain of its foreign subsidiaries from time to time for general corporate purposes.

        Guarantee and Security.    SIRVA and certain of the existing and subsequently acquired or organized domestic subsidiaries of North American Van Lines guarantee the obligations of North American Van Lines and would guarantee any borrowings made by any foreign subsidiary borrowers. A foreign subsidiary's borrowings would be guaranteed by North American Van Lines and certain of its domestic subsidiaries, and would also be guaranteed by certain subsidiaries of that foreign subsidiary borrower. North American Van Lines' obligations under the senior secured credit facility are secured by substantially all of SIRVA's tangible and intangible assets and those of North American Van Lines and certain of its domestic subsidiaries, except that:

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•

the stock or securities of the foreign subsidiaries of North American Van Lines (other than any direct first-tier foreign subsidiary of North American Van Lines) is not required to be pledged to secure these obligations,



•

no more than 65% of the stock or securities of a direct first-tier foreign subsidiary of North American Van Lines is required to be pledged to secure these obligations, and



•

no more than 65% of the stock or securities of any domestic subsidiary of North American Van Lines that acts as a holding company for foreign subsidiaries of North American Van Lines is required to be pledged to secure these obligations.

        In the event that any foreign subsidiary of North American Van Lines borrows under the senior secured credit facility, its obligations will be secured by not more than 65% of the stock of such foreign subsidiary borrower and by substantially all of SIRVA's tangible and intangible assets, those of such foreign subsidiary borrower, North American Van Lines, certain of North American Van Lines' domestic subsidiaries and the capital stock of certain of the subsidiaries of the foreign subsidiary borrower.

        Amortization; Interest; Fees; Maturity.    The term loan obligations under the senior credit agreement are repayable in quarterly principal payments over seven years, in the case of the Tranche A Term Loan, or eight years, in the case of the Tranche B Term Loan. Loans under the revolving credit facility mature on the seventh anniversary of the initial borrowing. The term loans and loans under the revolving credit facility bear interest at specified margins over a base rate or a eurodollar rate, depending on the interest rate option we elect. As of September 30, 2003, the interest rate on the Tranche A loan was 3.87%, the interest rate on the Tranche B loan was 5.12% and the interest on the $82.0 million then outstanding under the revolving credit facility was 3.92%.

        A commitment fee is payable quarterly on the daily average undrawn portion of the revolving credit facility, in the amount of 0.50% per annum or less, depending on our financial performance.

        Prepayments.    The senior credit agreement permits voluntary prepayment of the term loans and loans under the revolving credit facility without premium or penalty except for breakage costs incurred in connection with prepayment during a eurodollar interest period. Optional prepayments of Tranche B Term loans and any prepayments, whether optional or mandatory, made as a result of or in connection with a change of control, or any refinancing of any of the senior credit facilities, shall be at par plus accrued interest.

        Covenants and Events of Default.    The senior secured credit facility is subject to covenants that, among other things, restrict the ability of North American Van Lines and its subsidiaries to:

•

dispose of assets,



•

incur indebtedness or guarantee obligations,



•

prepay other indebtedness,



•

make dividends and other restricted payments,



•

create liens,



•

make equity or debt investments,



•

make acquisitions,



•

modify terms of the indenture,



•

engage in mergers or consolidations,



•

change the business we conduct,



•

make capital expenditures, or



•

engage in certain transactions with affiliates.

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In addition, under the senior secured credit facility, North American Van Lines is also subject to certain financial covenants, including the requirement to maintain a minimum interest coverage ratio and a maximum leverage ratio. These financial tests become more restrictive in future years. The senior secured credit facility is subject to customary events of default.

        The consolidated interest coverage ratio and consolidated leverage ratio requirements are:

	Consolidated Interest Coverage Ratio		Consolidated Leverage Ratio
	Target	Actual	Target	Actual
December 31, 2002	>2.00 to 1.00	2.89 to 1.00	<4.60 to 1.00	3.77 to 1.00
September 30, 2003	>2.35 to 1.00	3.39 to 1.00	<4.60 to 1.00	3.61 to 1.00
December 31, 2003	>2.65 to 1.00		<3.85 to 1.00
December 31, 2004	>3.00 to 1.00		<3.35 to 1.00
December 31, 2005 and thereafter	>3.00 to 1.00		<3.00 to 1.00

Senior Discount Debt

        General.    In November 1999, SIRVA incurred $35.0 million initial value of unsecured senior discount term loan borrowings from JPMorgan Chase Bank and Blue Ridge Investments, LLC. In November 2002, the lenders assigned the senior discount term loans to Arawak, Ltd., a wholly owned subsidiary of Clayton, Dubilier & Rice Fund VI Limited Partnership, who owned 23.5% of our capital stock as at September 30, 2003. This senior discount loan accretes at a rate of 8.0% semi-annually from its initial value of $35.0 million. Such amount had accreted to $63.5 million as of September 30, 2003. Under the loan agreement relating to the senior discount term loans, as amended, the lenders may exchange the senior discount term loan for senior discount notes due 2009 by giving us written notice. The initial value of the senior discount notes will equal the then accreted value of the senior discount term loans.

        The following is a brief summary of the principal terms of the senior discount notes, and is subject to and qualified in its entirety by reference to the indenture by which the senior discount notes will be governed. The senior discount loan has economic and other substantive terms substantially identical to those of the senior discount notes.

        Covenants, Events of Default and Registration Rights.    The senior discount term loans are, and any senior discount notes would be, subject to covenants, events of default and registration requirements similar to those relating to the senior subordinated notes described below.

        We intend to apply a portion of the net proceeds of this offering to redeem the senior discount term loans.

Senior Subordinated Notes

        The $150.0 million aggregate principal amount of 13³/8% senior subordinated notes due 2009 were issued by North American Van Lines in November 1999 pursuant to an indenture. The following summary is a description of the principal terms of the notes and the indenture and is subject to and qualified in its entirety by reference to the notes and the indenture.

        The senior subordinated notes mature in 2009. The senior subordinated notes bear interest at a rate of 13³/8% per annum. On or after December 1, 2004, North American Van Lines may redeem the notes, in whole or in part, at certain redemption prices, together with accrued and unpaid interest, if any, to the date of redemption. The notes are not subject to any sinking fund obligations.

        Upon the occurrence of specified changes in control, North American Van Lines is required to make an offer to repurchase the notes. In such an event, the repurchase price would equal 101% of the principal amount of the repurchased notes, together with accrued and unpaid interest, if any, to the date of repurchase. The senior secured

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credit facilities, however, prohibit the purchase of the notes by North American Van Lines in the event of a change of control, unless and until such time as the indebtedness under the senior secured credit facilities is paid in full. In the event such prohibition is in effect at the time of a change of control, North American Van Lines must either (i) repay in full all bank indebtedness or offer to repay in full all bank indebtedness and repay the bank indebtedness of each lender who has accepted such offer or (ii) obtain the requisite consent under the agreements governing the bank indebtedness to permit the repurchase of the notes.

        The senior subordinated notes are fully and unconditionally guaranteed on an unsecured, senior subordinated basis, by certain of North American Van Lines' domestic subsidiaries.

        The indenture contains restrictive covenants that, among other things,

•

limit the incurrence of additional indebtedness by North American Van Lines and its subsidiaries;



•

limit the redemption of capital stock of North American Van Lines, the payment of dividends on capital stock of North American Van Lines and the redemption of certain subordinated obligations and certain other existing indebtedness of North American Van Lines and its subsidiaries;



•

limit other restricted payments (including certain types of investments);



•

limit sales of assets and subsidiary stock;



•

limit transactions with affiliates; and



•

limit consolidations, mergers and transfers of all or substantially all North American Van Lines' assets.

        The indenture also prohibits certain restrictions on distributions from subsidiaries and limits the incurrence of certain senior subordinated indebtedness and secured indebtedness. All of these limitations and prohibitions are subject to a number of important qualifications and exceptions. The indenture contains events of default customary for high yield debt securities.

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DESCRIPTION OF CAPITAL STOCK

Overview

        Our amended and restated certificate of incorporation will become effective prior to the completion of this offering. It authorizes up to 500,000,000 shares of common stock, par value $.01 per share, and 50,000,000 shares of preferred stock, par value $.01 per share. We refer to our amended and restated certificate of incorporation in this prospectus as our "certificate of incorporation."

        Assuming a split of each share of our common stock for 3.17 shares of common stock by way of reclassification that we intend to effect prior to the completion of this offering, 70,084,748 shares of common stock would be issued and outstanding and held of record by stockholders, and no shares of preferred stock would be issued or outstanding, on the closing of this offering.

        Our amended and restated by-laws will also become effective prior to the completion of this offering. We will refer to our amended and restated by-laws in this prospectus as our "by-laws."

        The following descriptions of our capital stock and provisions of our certificate of incorporation and by-laws are summaries of their material terms and provisions and are qualified by reference to our certificate of incorporation and by-laws, copies of which will be filed with the SEC as exhibits to our registration statement of which this prospectus is a part. The descriptions reflect changes to our capital structure, certificate of incorporation and by-laws that will occur upon the closing of this offering.

Common Stock

        Holders of common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders and do not have cumulative voting rights. Accordingly, holders of a majority of the shares of common stock entitled to vote in any election of directors may elect all of the directors standing for election.

        Holders of common stock are entitled to receive proportionately any dividends that may be declared by our board of directors, subject to any preferential dividend rights of outstanding preferred stock. In the event of our liquidation, dissolution or winding up, holders of common stock will be entitled to receive proportionately any of our assets remaining after the payment of liabilities and subject to the prior rights of any outstanding preferred stock.

        Holders of common stock have no preemptive, subscription, redemption or conversion rights. The outstanding shares of common stock are, and the shares of common stock offered by us in this offering, when issued, will be, fully paid and non-assessable. The rights and privileges of holders of common stock are subject to any series of preferred stock that we may issue in the future, as described below.

Preferred Stock

        Our certificate of incorporation will provide that our board of directors has the authority, without further vote or action by the stockholders, to issue up to 50,000,000 shares of preferred stock in one or more series and to fix the number of shares constituting any such series and the preferences, limitations and relative rights, including dividend rights, dividend rate, voting rights, terms of redemption, redemption price or prices, conversion rights and liquidation preferences of the shares constituting any series. The issuance of preferred stock could adversely affect the rights of holders of common stock. We have no present plan to issue any shares of preferred stock after the completion of this offering.

Change of Control Related Provisions of Our Certificate of Incorporation and By-laws, and Delaware Law

        A number of provisions in our certificate of incorporation and by-laws and under the Delaware General Corporation Law may make it more difficult to acquire control of us. These provisions may have the effect of discouraging a future takeover attempt not approved by our board of directors but which individual stockholders

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may deem to be in their best interests or in which stockholders may receive a substantial premium for their shares over then current market prices. As a result, stockholders who might desire to participate in such a transaction may not have an opportunity to do so. In addition, these provisions may adversely affect the prevailing market price of the common stock. These provisions are intended to:

•

enhance the likelihood of continuity and stability in the composition of our board of directors;



•

discourage some types of transactions that may involve an actual or threatened change in control of us;



•

discourage certain tactics that may be used in proxy fights;



•

ensure that our board of directors will have sufficient time to act in what the board believes to be in the best interests of us and our stockholders; and



•

encourage persons seeking to acquire control of us to consult first with our board to negotiate the terms of any proposed business combination or offer.

        Section 203 generally prohibits a publicly held Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a period of three years following the date the person became an interested stockholder, unless:

•

the board of directors approved the transaction in which such stockholder became an interested stockholder;



•

the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding shares owned by persons who are directors and also officers; or



•

the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the holders of at least 66²/3% of the outstanding voting stock not owned by the interested stockholder.

        A "business combination" includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. An "interested stockholder" is a person who, together with affiliates and associates, owns, or within three years prior to the determination of interested stockholder status, owned, 15% or more of a corporation's voting stock, subject to specified exceptions.

        As a Delaware corporation, we would be subject to Section 203 of the Delaware General Corporation Law, unless we elect in our certificate of incorporation not to be governed by Section 203. We have made that election. Accordingly, Section 203 does not restrict any person who acquires 15% or more of our outstanding voting stock, whether or not from our principal stockholders, Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership, from engaging in business combinations with us within the three year period.

Unissued Shares of Capital Stock

        Common Stock.    We currently plan to issue an estimated 13,157,895 shares of our authorized common stock in this offering. The remaining shares of authorized and unissued common stock will be available for future issuance without additional stockholder approval. While the additional shares are not designed to deter or prevent a change of control, under some circumstances we could use the additional shares to create voting impediments or to frustrate persons seeking to effect a takeover or otherwise gain control by, for example, issuing those shares in private placements to purchasers who might side with our board of directors in opposing a hostile takeover bid.

        Preferred Stock.    Our certificate of incorporation will provide that our board of directors has the authority, without any further vote or action by our stockholders, to issue preferred stock in one or more series and to fix the number of shares constituting any such series and the preferences, limitations and relative rights, including dividend rights, dividend rate, voting rights, terms of redemption, redemption price or prices, conversion rights and liquidation preferences of the shares constituting any series. The existence of authorized but unissued preferred stock could reduce our attractiveness as a target for an unsolicited takeover bid since we could, for example, issue

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shares of preferred stock to parties who might oppose such a takeover bid or shares that contain terms the potential acquiror may find unattractive. This may have the effect of delaying or preventing a change of control, may discourage bids for the common stock at a premium over the market price of the common stock, and may adversely affect the market price of, and the voting and other rights of the holders of, common stock.

Classified Board of Directors, Vacancies and Removal of Directors

        Our certificate of incorporation will provide that our board of directors will be divided into three classes of even number or nearly even number, with each class elected for staggered three-year terms expiring in successive years. Any effort to obtain control of our board of directors by causing the election of a majority of the board of directors may require more time than would be required without a staggered election structure.

        Our certificate of incorporation also provides that directors may be removed only for cause at a meeting of stockholders by a majority of the shares then entitled to vote. Vacancies in our board of directors may be filled only by our board of directors. Any director elected to fill a vacancy will hold office for the remainder of the full term of the class of directors in which the vacancy occurred (including a vacancy created by increasing the size of the board) and until such director's successor shall have been duly elected and qualified. No decrease in the number of directors will shorten the term of any incumbent director. Our by-laws will provide that the number of directors shall be fixed and increased or decreased from time to time by resolution of the board of directors, but the board of directors shall at no time consist of fewer than three directors.

        These provisions may have the effect of slowing or impeding a third party from initiating a proxy contest, making a tender offer or otherwise attempting a change in the membership of our board of directors that would effect a change of control.

Advance Notice Requirements for Nomination of Directors and Presentation of New Business at Meetings of Stockholders; Action by Written Consent

        Our by-laws provide for advance notice requirements for stockholder proposals and nominations for director. Generally, to be timely, notice must be received at our principal executive offices not less than 90 days nor more than 120 days prior to the first anniversary date of the annual meeting for the preceding year.

        In addition, under the provisions of both our certificate of incorporation and by-laws, action may not be taken by written consent of stockholders; rather, any action taken by the stockholders must be effected at a duly called annual or special meeting. The chief executive officer or, under some circumstances, the president and the board of directors may call a special meeting.

        These provisions make it more procedurally difficult for a stockholder to place a proposal or nomination on the meeting agenda or to take action without a meeting, and therefore may reduce the likelihood that a stockholder will seek to take independent action to replace directors or seek a stockholder vote with respect to other matters that are not supported by management.

Limitation of Liability of Directors

        Our certificate of incorporation provides that no director will be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent that this limitation on or exemption from liability is not permitted by the Delaware General Corporation Law and any amendments to that law.

        The principal effect of the limitation on liability provision is that a stockholder will be unable to prosecute an action for monetary damages against a director unless the stockholder can demonstrate a basis for liability for which indemnification is not available under the Delaware General Corporation Law. This provision, however, does not eliminate or limit director liability arising in connection with causes of action brought under the federal securities laws. Our certificate of incorporation does not eliminate our directors' duty of care. The inclusion of this provision in our certificate of incorporation may, however, discourage or deter stockholders or management from

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bringing a lawsuit against directors for a breach of their fiduciary duties, even though such an action, if successful, might otherwise have benefited us and our stockholders. This provision should not affect the availability of equitable remedies such as injunction or rescission based upon a director's breach of the duty of care.

        Our by-laws also provide that we will indemnify our directors and officers to the fullest extent permitted by Delaware law. We are required to indemnify our directors and officers for all judgments, fines, settlements, legal fees and other expenses incurred in connection with pending or threatened legal proceedings because of the director's or officer's positions with us or another entity that the director or officer serves at our request, subject to various conditions, and to advance funds to our directors and officers to enable them to defend against such proceedings. To receive indemnification, the director or officer must have been successful in the legal proceeding or have acted in good faith and in what was reasonably believed to be a lawful manner in our best interest.

Supermajority Voting Requirement for Amendment of Certain Provisions of our Certificate of Incorporation and By-Laws

        The provisions of our certificate of incorporation governing, among other things, the classified board, the liability of directors, the elimination of stockholder actions by written consent and the prohibition on the right of stockholders to call a special meeting, may not be amended, altered or repealed unless the amendment is approved by the vote of holders of 75% of the shares then entitled to vote at an election of directors. This requirement exceeds the majority vote of the outstanding stock that would otherwise be required by the Delaware General Corporation Law for the repeal or amendment of such provisions of the certificate of incorporation. Our by-laws may be amended by the board of directors or by the vote of holders of 75% of the shares then entitled to vote. These provisions make it more difficult for any person to remove or amend any provisions that may have an anti-takeover effect.

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SHARES ELIGIBLE FOR FUTURE SALE

        Prior to this offering, there was no public market for our common stock. Future sales of substantial amounts of common stock in the public market could adversely affect the market price of our common stock. After this offering is completed, the number of shares available for future sale into the public markets is subject to legal and contractual restrictions, some of which are described below. The expiration of these restrictions will permit sales of substantial amounts of our common stock in the public market or could create the perception that these sales could occur, which could adversely affect the market price for our common stock. These factors could also make it more difficult for us to raise funds through future offerings of common stock.

Sale of Restricted Securities

        After this offering, 70,084,748 shares of common stock will be outstanding. Of these shares, all of the shares sold in this offering will be freely tradable without restriction under the Securities Act, unless purchased by our "affiliates" as that term is defined in Rule 144 under the Securities Act. The remaining 49,032,116 shares of common stock that will be outstanding after this offering are "restricted securities" within the meaning of Rule 144 under the Securities Act. Restricted securities may be sold in the public market only if they are registered under the Securities Act or are sold pursuant to an exemption from registration under Rule 144 or Rule 701 under the Securities Act, which are summarized below. Subject to the lockup agreements described below, shares held by our affiliates that are not restricted securities or that have been owned for more than one year may be sold subject to compliance with Rule 144 of the Securities Act without regard to the prescribed one-year holding period under Rule 144.

Stock Options

        Upon completion of this offering, we intend to file one or more registration statements under the Securities Act to register the shares of common stock to be issued under our stock option plans and, as a result, all shares of common stock acquired upon exercise of stock options and other equity-based awards granted under these plans will also be freely tradable under the Securities Act unless purchased by our affiliates. A total of 12,187,598 shares of common stock are reserved for issuance under our benefit plans.

Lock-Up Arrangements

        We, Clayton, Dubilier & Rice Fund V Limited Partnership and Clayton, Dubilier & Rice Fund VI Limited Partnership and the directors and executive officers named under "Principal Stockholders" have agreed with the underwriters, subject to exceptions, not to (1) offer, sell, contract to sell, pledge, hypothecate, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, make any short sale or otherwise transfer or dispose of, directly or indirectly, any shares of common stock, any options, rights or warrants to purchase any shares of common stock or any securities convertible into, exercisable or exchangeable for or that represent the right to receive shares of common stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the shares of common stock or other securities described in (1), for 180 days after the date of this prospectus, except with the prior written consent of Credit Suisse First Boston LLC and Goldman Sachs & Co. In addition, we have agreed not to waive the 180-day lock-up provision in our Registration and Participation Agreement without the prior written consent of Credit Suisse First Boston LLC and Goldman, Sachs & Co. See "Certain Relationships and Related Transactions." Following the lock-up periods, we estimate that approximately 49,032,116 shares of our common stock that are restricted securities or are held by our affiliates as of the date of this prospectus will be eligible for sale in the public market in compliance with Rule 144 or Rule 701 under the Securities Act.

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Registration and Participation Agreement

        Stockholders currently representing substantially all of the shares of our common stock will have the right to require us to register shares of common stock for resale in some circumstances. See "Certain Relationships and Related Transactions."

Rule 144

        In general, under Rule 144, as currently in effect, beginning 90 days after the date of this prospectus, any person or persons whose shares are aggregated, including an affiliate, who has beneficially owned shares of our common stock for a period of at least one year is entitled to sell, within any three-month period, a number of shares that does not exceed the greater of:

•

1% of the then-outstanding shares of common stock; and



•

the average weekly trading volume in the common stock on the New York Stock Exchange during the four calendar weeks preceding the date on which the notice of the sale is filed with the Securities and Exchange Commission.

        Sales under Rule 144 are also subject to provisions relating to notice, manner of sale, volume limitations and the availability of current public information about us.

        Under Rule 144(k), a person who is not deemed to have been one of our affiliates at any time during the 90 days preceding a sale, and who has beneficially owned the shares for at least two years, including the holding period of any prior owner other than an "affiliate," is entitled to sell the shares without complying with the manner of sale, public information, volume limitation or notice provisions of Rule 144.

Rule 701

        In general, Rule 701 under the Securities Act may be relied upon for the resale of our common stock originally issued by us before our initial public offering to our employees, directors, officers, consultants or advisers under written compensatory benefit plans, including our stock option plans, or contracts relating to the compensation of these persons. Shares of our common stock issued in reliance on Rule 701 are "restricted securities" and, beginning 90 days after the date of this prospectus, may be sold by non-affiliates subject only to the manner of sale provisions of Rule 144 and by affiliates under Rule 144 without compliance with the one-year holding period, in each case subject to the lockup agreements.

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MATERIAL U.S. FEDERAL TAX CONSIDERATIONS

        The following is a general discussion of material U.S. federal tax considerations relating to the purchase, ownership and disposition of our common stock to holders who hold shares of our common stock as capital assets. This discussion is based on currently existing provisions of the Internal Revenue Code of 1986, as amended (the "Code"), existing and proposed Treasury regulations promulgated thereunder, and administrative and judicial interpretations thereof, all as in effect or proposed on the date hereof and all of which are subject to change, possibly with retroactive effect or different interpretations. This discussion does not address all of the tax considerations that may be relevant to specific holders in light of their particular circumstances or to holders subject to special treatment under U.S. federal tax laws (such as certain financial institutions, insurance companies, tax-exempt entities, retirement plans, dealers in securities, brokers, expatriates, or persons who have acquired our common stock as part of a straddle, hedge, conversion transaction or other integrated investment). This discussion does not address the U.S. state and local or non-U.S. tax considerations relating to the purchase, ownership and disposition of our common stock.

        As used in this discussion, the term "U.S. holder" means a beneficial owner of our common stock that is a U.S. person. A U.S. person means a person that is for U.S. federal income tax purposes:

(i)

an individual who is a citizen or resident of the United States;



(ii)

a corporation, entity taxable as a corporation, or partnership created or organized in or under the laws of the United States or of any state or political subdivision thereof or therein, including the District of Columbia (other than a partnership that is not treated as a U.S. person under applicable Treasury regulations);



(iii)

an estate the income of which is subject to U.S. federal income tax regardless of the source thereof; or



(iv)

a trust with respect to which a court within the United States is able to exercise primary supervision over its administration and one or more U.S. persons have the authority to control all of its substantial decisions, or certain electing trusts that were in existence on August 19, 1996 and were treated as domestic trusts on that date.

        The term "non-U.S. holder" means a beneficial owner of our common stock that is not a U.S. person.

        An individual may, subject to certain exceptions, be deemed to be a resident of the United States for a calendar year by reason of being present in the United States for at least 31 days in such calendar year and for an aggregate of at least 183 days during a three-year period ending with such current calendar year (counting for such purposes all of the days present in such current calendar year, one-third of the days present in the immediately preceding calendar year, and one-sixth of the days present in the second preceding calendar year).

Prospective purchasers are urged to consult their own tax advisors as to the particular tax considerations applicable to them relating to the purchase, ownership and disposition of our common stock, including the applicability of U.S. federal, state or local tax laws or non-U.S. tax laws, any changes in applicable tax laws and any pending or proposed legislation or regulations.

U.S. Holders

Dividends

        Any dividend on our common stock paid by us out of our current or accumulated earnings and profits (as determined for U.S. federal income tax purposes) will be included in income by a U.S. holder of common stock when received. Any such dividend will be eligible for the dividends-received deduction, if received by a qualifying corporate U.S. holder that meets the holding period and other requirements for the dividends-received deduction.

        Recently enacted legislation reduces to 15% the maximum U.S. federal income tax rate for certain dividends received by individuals through December 31, 2008, so long as certain holding period requirements are met. Unless continuing legislation is enacted, dividends received by individuals after December 31, 2008 will not benefit from

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this reduction in U.S. federal income tax rates and will thereafter be taxed as ordinary income subject to the U.S. holder's applicable federal income tax rate.

Sale, Exchange or Other Disposition

        Upon a sale, exchange or other disposition of our common stock, a U.S. holder will recognize capital gain or loss in an amount equal to the difference between the amount realized and such U.S. holder's adjusted tax basis in the common stock. Recently enacted legislation also generally reduces to 15% the maximum U.S. federal income tax rate on capital gains recognized by individuals on the sale, exchange or other disposition of our common stock held for more than one year, through taxable years beginning on or before December 31, 2008. The deductibility of capital losses is subject to limitations. Unless continuing legislation is enacted, sales, exchanges or other dispositions of our common stock by individuals after December 31, 2008 will not benefit from this reduction in U.S. Federal income tax rates.

Information Reporting and Backup Withholding Tax

        In general, payments made to a U.S. holder on or with respect to our common stock will be subject to information reporting. Certain U.S. holders may be subject to backup withholding tax (at a rate equal to 28% from 2003 through 2010 and 31% after 2010) on payments made on or with respect to our common stock if such U.S. holder fails to supply a correct taxpayer identification number or otherwise fails to comply with applicable U.S. information reporting or certification requirements. Certain persons are exempt from backup withholding including, in certain circumstances, corporations and financial institutions. Any amounts withheld under the backup withholding rules from a payment to a U.S. holder will be allowed as a refund or a credit against such U.S. holder's U.S. federal income tax liability, provided that the required procedures are followed.

Non-U.S. Holders

Dividends

        We or a withholding agent will have to withhold U.S. federal withholding tax from the gross amount of any dividends paid to a non-U.S. holder at a rate of 30%, unless (i) an applicable income tax treaty reduces or eliminates such tax, and a non-U.S. holder claiming the benefit of such treaty provides to us or such agent proper Internal Revenue Service ("IRS") documentation, or (ii) the dividends are effectively connected with a non-U.S. holder's conduct of a trade or business in the United States and the non-U.S. holder provides to us or such agent proper IRS documentation. In the latter case, such non-U.S. holder generally will be subject to U.S. federal income tax with respect to such dividends in the same manner as a U.S. citizen or corporation, as applicable, unless otherwise provided in an applicable income tax treaty. Additionally, a non-U.S. holder that is a corporation could be subject to a branch profits tax on effectively connected dividend income at a rate of 30% (or at a reduced rate under an applicable income tax treaty). In addition, where dividends are paid to a non-U.S. holder that is a partnership or other pass-through entity, persons holding an interest in the entity may need to provide certification claiming an exemption or reduction in withholding under an applicable income tax treaty. If a non-U.S. holder is eligible for a reduced rate of U.S. federal withholding tax pursuant to an income tax treaty, such non-U.S. holder may obtain a refund of any excess amount withheld by filing an appropriate claim for refund with the IRS.

Sale, Exchange or Other Disposition

        Generally, a non-U.S. holder will not be subject to U.S. federal income tax on gain realized upon the sale, exchange or other disposition of our common stock unless (i) such non-U.S. holder is an individual present in the United States for 183 days or more in the taxable year of the sale, exchange or other disposition and certain other conditions are met, (ii) the gain is effectively connected with such non-U.S. holder's conduct of a trade or business in the United States or (iii) we are or have been a "United States real property holding corporation" for U.S. federal income tax purposes at any time during the shorter of the five-year period preceding such sale, exchange or disposition or the period that such non-U.S. holder held our common stock (which we do not believe that we have

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been, are currently or are likely to be) and certain other conditions are met. If the first exception applies, the non-U.S. Holder generally will be subject to U.S. federal income tax at a rate of 30% (or at a reduced rate under an applicable income tax treaty) on the amount by which capital gains allocable to U.S. sources (including gains from the sale, exchange or other disposition of our common stock) exceed capital losses allocable to U.S. sources. If the second or third exception applies, the non-U.S. holder generally will be subject to U.S. federal income tax with respect to such gain in the same manner as a U.S. citizen or corporation, as applicable, unless otherwise provided in an applicable income tax treaty, and a non-U.S. holder that is a corporation could also be subject to a branch profits tax on such gain at a rate of 30% (or at a reduced rate under an applicable income tax treaty).

Federal Estate Tax

        Common stock owned or treated as owned by an individual who is a non-U.S. holder at the time of his or her death generally will be included in the individual's gross estate for U.S. federal estate tax purposes and may be subject to U.S. federal estate tax unless an applicable estate tax treaty provides otherwise.

        Current U.S. federal tax law provides for reductions in U.S. federal estate tax through 2009 and the elimination of such estate tax entirely in 2010. Under this law, such estate tax would be fully reinstated, as in effect prior to the reductions, in 2011, unless further legislation is enacted.

Information Reporting and Backup Withholding Tax

        Information reporting may apply to payments made to a non-U.S. holder on or with respect to our common stock. Backup withholding tax (at a rate equal to 28% from 2003 through 2010 and 31% after 2010) may also apply to payments made to a non-U.S. holder on or with respect to our common stock, unless the non-U.S. holder certifies as to its status as a non-U.S. holder under penalties of perjury or otherwise establishes an exemption, and certain other conditions are satisfied. Any amounts withheld under the backup withholding rules from a payment to a non-U.S. holder will be allowed as a refund or a credit against such non-U.S. holder's U.S. federal income tax liability, provided that the required procedures are followed.

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UNDERWRITING

        SIRVA, the selling stockholders and the underwriters named below have entered into an underwriting agreement with respect to the shares being offered. Subject to certain conditions, each underwriter has severally agreed to purchase the number of shares indicated in the following table. Credit Suisse First Boston LLC and Goldman, Sachs & Co. are the joint book running managers and the representatives of the underwriters.

Underwriters		Number of Shares
Credit Suisse First Boston LLC
Goldman, Sachs & Co.
Deutsche Bank Securities Inc.
Citigroup Global Markets Inc.
J.P. Morgan Securities Inc.
Banc of America Securities LLC
	Total

        The underwriters are committed to take and pay for all of the shares being offered, if any are taken, other than the shares covered by the option described below unless and until this option is exercised.

        If the underwriters sell more shares than the total number set forth in the table above, the underwriters have an option to buy up to an additional 3,157,894 shares from the selling stockholders to cover such sales. They may exercise that option for 30 days. If any shares are purchased pursuant to this option, the underwriters will severally purchase shares in approximately the same proportion as set forth in the table above.

        The following tables show the per share and total underwriting discounts and commissions to be paid to the underwriters by us and the selling stockholders. Such amounts are shown assuming both no exercise and full exercise of the underwriters' option to purchase 3,157,894 additional shares.

Paid by SIRVA

	No Exercise	Full Exercise
Per Share	$	$
Total	$	$

Paid by the Selling Stockholders

	No Exercise	Full Exercise
Per Share	$	$
Total	$	$

        Shares sold by the underwriters to the public will initially be offered at the initial public offering price set forth on the cover of this prospectus. Any shares sold by the underwriters to securities dealers may be sold at a discount of up to $    per share from the initial public offering price. Any such securities dealers may resell any shares purchased from the underwriters to certain other brokers or dealers at a discount of up to $    per share from the initial public offering price. If all the shares are not sold at the initial public offering price, the representatives may change the offering price and the other selling terms.

        SIRVA, the selling stockholders and the directors and executive officers named under "Principal Stockholders" have agreed with the underwriters not to dispose of or hedge any of their common stock or securities convertible into or exchangeable for shares of common stock during the period from the date of this prospectus continuing through the date 180 days after the date of this prospectus, except with the prior written consent of both of the representatives. This agreement does not apply to any existing employee benefit plans. See "Shares Eligible for Future Sale" for a discussion of certain transfer restrictions.

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        Prior to the offering, there has been no public market for the shares. The initial public offering price has been negotiated among us and the representatives. Among the factors to be considered in determining the initial public offering price of the shares, in addition to prevailing market conditions, will be our historical performance, estimates of our business potential and earnings prospects, an assessment of our management and the consideration of the above factors in relation to market valuation of companies in related businesses.

        The common stock is approved to be listed on the New York Stock Exchange under the symbol "SIR".

        In connection with the offering, the underwriters may purchase and sell shares of common stock in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Shorts sales involve the sale by the underwriters of a greater number of shares than they are required to purchase in the offering. "Covered" short sales are sales made in an amount not greater than the underwriters' option to purchase additional shares from the selling stockholders in the offering. The underwriters may close out any covered short position by either exercising their option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to close out the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase additional shares pursuant to the option granted to them. "Naked" short sales are any sales in excess of such option. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing transactions consist of various bids for or purchases of common stock made by the underwriters in the open market prior to the completion of the offering.

        The underwriters may also impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased shares sold by or for the account of such underwriter in stabilizing or short covering transactions.

        Purchases to cover a short position and stabilizing transactions may have the effect of preventing or retarding a decline in the market price of the company's stock, and together with the imposition of the penalty bid, may stabilize, maintain or otherwise affect the market price of the common stock. As a result, the price of the common stock may be higher than the price that otherwise might exist in the open market. If these activities are commenced, they may be discontinued at any time. These transactions may be effected on the New York Stock Exchange, in the over-the-counter market or otherwise.

        Each underwriter has represented, warranted and agreed that: (i) it has not offered or sold and, prior to the expiry of a period of six months from the Closing date, will not offer or sell any shares to persons in the United Kingdom except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their businesses or otherwise in circumstances which have not resulted and will not result in an offer to the public in the United Kingdom within the meaning of the Public Offers of Securities Regulations 1995; (ii) it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000 ("FSMA")) received by it in connection with the issue or sale of any shares in circumstances in which section 21(1) of the FSMA does not apply to the Issuer; and (iii) it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the shares in, from or otherwise involving the United Kingdom.

        The securities may not be offered, sold, transferred or delivered in or from The Netherlands, as part of their initial distribution or as part of any re-offering, and neither this prospectus nor any other document in respect of the offering may be distributed or circulated in The Netherlands, other than to individuals or legal entities which include, but are not limited to, banks, brokers, dealers, institutional investors and undertakings with a treasury department, who or which trade or invest in securities in the conduct of a business or profession.

        No syndicate member has offered or sold, or will offer or sell, in Hong Kong, by means of any document, any shares other than to persons whose ordinary business it is to buy or sell shares or debentures, whether as principal or

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agent, or under circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap. 32) of Hong Kong, nor has it issued or had in its possession for the purpose of issue, nor will it issue or have in its possession for the purpose of issue, any invitation or advertisement relating to the shares in Hong Kong (except as permitted by the securities laws of Hong Kong) other than with respect to shares which are intended to be disposed of to persons outside Hong Kong or to be disposed of only to persons whose business involves the acquisition, disposal, or holding of securities (whether as principal or as agent).

        This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation or subscription or purchase, of the shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than under circumstances in which such offer, sale or invitation does not constitute an offer or sale, or invitation for subscription or purchase, of the shares to the public in Singapore.

        Each underwriter has acknowledged and agreed that the securities have not been registered under the Securities and Exchange Law of Japan and are not being offered or sold and may not be offered or sold, directly or indirectly, in Japan or to or for the account of any resident of Japan, except (i) pursuant to an exemption from the registration requirements of the Securities and Exchange Law of Japan and (ii) in compliance with any other applicable requirements of Japanese law.

        The underwriters have reserved for sale at the initial public offering price up to approximately 210,500 shares of the common stock for employees, directors and other persons associated with us who have expressed an interest in purchasing common stock in the offering. The number of shares available for sale to the general public in the offering will be reduced to the extent these persons purchase the reserved shares. Any reserved shares not so purchased will be offered by the underwriters to the general public on the same terms as the other shares.

        The underwriters do not expect sales to discretionary accounts to exceed five percent of the total number of shares offered.

        We and the selling stockholders estimate that our share of the total expenses of the offering, excluding underwriting discounts and commissions, will be approximately $    .

        We and the selling stockholders have agreed to indemnify the several underwriters against certain liabilities, including liabilities under the Securities Act of 1933. The selling stockholders may be deemed to be underwriters within the meaning of the Securities Act of 1933.

        Certain of the underwriters and their respective affiliates have, from time to time, performed, and may in the future perform, various financial advisory and investment banking services for us and our affiliates, for which they received or will receive customary fees and expenses. Under NAVL's existing senior credit facility, an affiliate of J.P. Morgan Securities Inc. is a lender and administrative agent, an affiliate of Banc of America Securities LLC is a lender and Bank of America Securities LLC is syndication agent, and an affiliate of Deutsche Bank Securities Inc. is a lender. These underwriters will receive a portion of the proceeds from the offering that are being used to repay the existing senior credit facility. In addition, certain underwriters and affiliates of all of the underwriters have made commitments under the new senior credit facility that will be used to effect the refinancing of the existing senior credit facility.

        An affiliate of Credit Suisse First Boston LLC has provided a loan to Arawak, Ltd., a wholly owned subsidiary of Clayton, Dubilier & Rice Fund VI Limited Partnership, which currently holds our senior discount loan. The senior discount loan will be repaid from the proceeds of the offering and Arawak is expected to use such payment to settle the loan from the affiliate of Credit Suisse First Boston LLC.

        Because Credit Suisse First Boston LLC, Deutsche Bank Securities Inc., J.P. Morgan Securities Inc. and Banc of America Securities LLC are underwriters and may receive more than 10% of the entire net proceeds in this offering, the underwriters may be deemed to have a "conflict of interest" under Rule 2710(c)(8) of the Conduct Rules of the National Association of Securities Dealers, Inc. Accordingly, this offering will be made in compliance

128

with the applicable provisions of Rule 2720 of the conduct rules. Rule 2720 requires that the initial public offering price can be no higher than that recommended by a "qualified independent underwriter", as defined by the NASD. Goldman, Sachs & Co. has served in that capacity and performed due diligence investigations and reviewed and participated in the preparation of the registration statement of which this prospectus forms a part. Goldman, Sachs & Co. will receive a fee from us as compensation for its role as qualified independent underwriter.

LEGAL MATTERS

        The validity of the issuance of the shares of common stock offered by this prospectus will be passed upon for us by Debevoise & Plimpton, New York, New York. Franci J. Blassberg, Esq., a member of Debevoise & Plimpton, is married to Joseph L. Rice III, who is a shareholder of the managing general partner of the general partner of Clayton, Dubilier & Rice Fund V Limited Partnership and a shareholder of the general partner of the general partner of Clayton, Dubilier & Rice Fund VI Limited Partnership. The underwriters have been represented by Cravath, Swaine & Moore LLP, New York New York.

EXPERTS

        The financial statements as of December 31, 2001 and 2002 and for each of the three years in the period ended December 31, 2002 included in this prospectus have been so included in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given on the authority of said firm as experts in auditing and accounting.

WHERE YOU CAN FIND MORE INFORMATION

        Upon consummation of this offering, we will be required to file annual and quarterly reports with the SEC. You may read and copy any documents filed by us at the Public Reference Section of the SEC, 450 Fifth Street, N.W., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Our filings with the SEC will also be available to the public through the SEC's website at http://www.sec.gov.

        We have filed with the SEC a registration statement on Form S-1 under the Securities Act for the registration of the common stock offered by this prospectus. This prospectus, which is a part of the registration statement, does not contain all of the information included in the registration statement. Any statement made in this prospectus concerning the contents of any contract, agreement or other document is not necessarily complete. For further information regarding our company and the common stock offered by this prospectus, please refer to the registration statement, including its exhibits. If we have filed any contract, agreement or other document as an exhibit to the registration statement, you should read the exhibit for a more complete understanding of the documents or matter involved.

129

INDEX TO FINANCIAL STATEMENTS

	Page
SIRVA, INC.
Report of Independent Accountants	F-2
Consolidated Balance Sheets at December 31, 2001 and 2002	F-3
Consolidated Statements of Operations for the years ended December 31, 2000, 2001 and 2002	F-5
Consolidated Statements of Cash Flows for the years ended December 31, 2000, 2001 and 2002	F-6
Notes to Consolidated Financial Statements	F-7
Unaudited Condensed Consolidated Balance Sheets at December 31, 2002 and September 30, 2003	F-57
Unaudited Condensed Consolidated Income Statements for the nine months ended September 30, 2002 and 2003	F-58
Unaudited Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2002 and 2003	F-59
Notes to Unaudited Condensed Consolidated Financial Statements	F-60

F-1

Report of Independent Accountants

The Board of Directors and Stockholders of
SIRVA, Inc.:

The stock split described in Note 24 to the financial statements had not become effective at November 12, 2003. When it becomes effective we will be in a position to furnish the following report:

"In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of SIRVA, Inc. and its subsidiaries at December 31, 2002 and December 31, 2001, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2002 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the index appearing under Item 16(b) presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedule are the responsibility of the Company's management; our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 6 to the consolidated financial statements, the Company changed the manner in which it accounts for goodwill and other intangible assets upon adoption of the accounting guidance of Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets on January 1, 2002."

PricewaterhouseCoopers LLP
Chicago, Illinois

February 7, 2003, except as to Notes 19, 20, and
      23, for which the date is August 15, 2003

F-2

SIRVA, INC.
Consolidated Balance Sheets
At December 31, 2001 and 2002

(Dollars in thousands)

	December 31, 2001		December 31, 2002
Assets
Current assets:
Cash and cash equivalents	$	32,119	$	45,480
Short-term investments		5,984		7,062
Accounts and notes receivable, net of allowance for doubtful accounts of $24,386 and $25,059, respectively		267,112		309,565
Current portion of contracts receivable, net of valuation allowance of $367 and $116, respectively		7,080		4,664
Resale equipment inventory		3,373		1,662
Mortgages held for resale		—		42,798
Relocation properties held for resale, net of allowance for loss on sale of $0 and $1,772, respectively		—		39,115
Supplies inventory		7,980		8,086
Prepaid expenses and other current assets		13,872		16,698
Deferred income taxes		37,051		37,151
Recoverable income taxes		3,094		490
Total current assets		377,665		512,771
Long-term portion of notes receivable		1,601		1,967
Long-term portion of contracts receivable		10,187		5,502
Investments		60,267		66,919
Property and equipment, net		165,367		171,257
Deferred agent contract costs		13,526		10,904
Goodwill, net		247,558		331,147
Intangible assets, net		165,671		228,177
Deferred debt issuance costs and other assets		32,147		28,891
Total long-term assets		696,324		844,764
Total assets	$	1,073,989	$	1,357,535

The accompanying notes are an integral part of the consolidated financial statements.

F-3

SIRVA, INC.
Consolidated Balance Sheets
At December 31, 2001 and 2002

(Dollars in thousands except share and per share data)

		December 31, 2001			December 31, 2002
Liabilities and Stockholders' Equity
Current liabilities:
	Current portion of long-term debt	$	16,958		$	22,412
	Current portion of capital lease obligations		4,006			4,849
	Mortgage warehouse facility		—			41,893
	Relocation financing facilities		—			15,432
	Other short-term debt		47,235			15,074
	Accounts payable		61,009			83,962
	Relocation properties related payables		—			38,630
	Outstanding checks		26,575			16,809
	Accrued transportation expense		66,532			63,691
	Unearned premiums and other deferred credits		25,084			42,732
	Compensation and benefits		22,137			30,684
	Other current liabilities		55,002			64,538
	Insurance and claims reserves		78,622			76,571
	Accrued income taxes		2,285			5,381
Total current liabilities			405,445			522,658
	Long-term debt		488,607			557,710
	Capital lease obligations		16,366			14,122
	Compensation and benefits		36,737			66,903
	Insurance and claims reserves		6,985			1,133
	Deferred income taxes		26,386			28,937
Total long-term liabilities			575,081			668,805
Total liabilities			980,526			1,191,463
Commitments and contingencies
Redeemable shares of common stock, $0.01 par value, 2,591,412 issued and 918,064 outstanding at December 31, 2001 and 3,702,249 shares issued and 1,870,053 outstanding at December 31, 2002, respectively			3,266			7,375
Redeemable junior preferred stock, $0.01 par value, 24,500 shares authorized, issued and outstanding at December 31, 2001 and 2002, with a liquidation preference of $1,000 per share			28,339			30,401
Stockholders' equity:
	Common stock, $0.01 par value, 500,000,000 shares authorized with 41,487,438 issued and 41,249,181 outstanding at December 31, 2001 and 55,232,644 issued and 54,730,865 outstanding at December 31, 2002, respectively		415			552
	Additional paid-in-capital		140,284			198,032
	Common stock purchase warrant		655			655
	Accumulated other comprehensive loss		(17,988	)		(29,075	)
	Accumulated deficit		(60,441	)		(39,620	)
Total paid-in-capital and accumulated deficit			62,925			130,544
Less cost of treasury stock, 238,257 and 501,779 shares at December 31, 2001 and 2002, respectively			(1,067	)		(2,248	)
Total stockholders' equity			61,858			128,296
Total liabilities and stockholders' equity		$	1,073,989		$	1,357,535

The accompanying notes are an integral part of the consolidated financial statements.

F-4

SIRVA, INC.
Consolidated Statements of Operations
For the years ended December 31, 2000, 2001 and 2002

(Dollars in thousands except share and per share data)

	Year Ended December 31, 2000			Year Ended December 31, 2001			Year Ended December 31, 2002
Operating revenues	$	2,378,694		$	2,249,303		$	2,185,646
Operating expenses:
Purchased transportation expense		1,559,784			1,438,753			1,303,217
Other direct expense		433,767			426,444			463,935
Total direct expenses		1,993,551			1,865,197			1,767,152
Gross margin		385,143			384,106			418,494
General and administrative expense		319,914			315,800			319,908
Goodwill and intangibles amortization		10,948			10,906			3,894
Asset impairment charge		—			—			7,092
Curtailment and other gains		—			—			(10,377	)
Restructuring and headquarters move		4,859			4,883			3,716
Income from operations		49,422			52,517			94,261
Non-operating income (expense) and minority interest		318			(51	)		(640	)
Interest expense		73,407			69,153			61,169
Income (loss) before income taxes and cumulative effect of accounting change		(23,667	)		(16,687	)		32,452
Provision (benefit) for income taxes		(1,782	)		(131	)		11,631
Income (loss) before cumulative effect of accounting change		(21,885	)		(16,556	)		20,821
Cumulative effect of accounting change, Net of tax		—			(328	)		—
Net income (loss)	$	(21,885	)	$	(16,884	)	$	20,821
Income (loss) per share before cumulative effect of accounting change – basic	$	(0.68	)	$	(0.47	)	$	0.33
Income (loss) per share before cumulative effect of accounting change – diluted	$	(0.68	)	$	(0.47	)	$	0.33
Net income (loss) per share – basic	$	(0.68	)	$	(0.48	)	$	0.33
Net income (loss) per share – diluted	$	(0.68	)	$	(0.48	)	$	0.33
Average number of common shares outstanding – basic		39,065,685			42,308,361			51,712,625
Average number of common shares outstanding – diluted		39,065,685			42,308,361			51,832,236

The accompanying notes are an integral part of the consolidated financial statements.

F-5

SIRVA, INC.
Consolidated Statements of Cash Flows
For the years ended December 31, 2000, 2001 and 2002

(Dollars in thousands)

				Year Ended December 31, 2000			Year Ended December 31, 2001			Year Ended December 31, 2002
Cash flows from operating activities:
	Net income (loss) before cumulative effect of accounting change			$	(21,885	)	$	(16,556	)	$	20,821
	Adjustments to reconcile net income (loss) to net cash provided by operating activities:
		Cumulative effect of accounting change			—			(328	)		—
		Depreciation			38,021			33,536			35,900
		Amortization			15,859			15,206			8,349
		Amortization of debt issuance costs			2,798			2,792			3,171
		Change in provision for losses on accounts and notes receivable			3,425			995			6,893
		Deferred income taxes			(26,929	)		(8,712	)		(5,752	)
		Impairment loss and (gain)/loss on sale of assets, net			(6,144	)		1,053			3,651
		Change in operating assets and liabilities, net of effect of acquisitions:
			Accounts and notes receivable		(66,703	)		98,081			5,531
			Contracts receivable		12,776			9,577			5,938
			Mortgages held for resale		—			—			(16,779	)
			Relocation properties held for resale, net		—			—			(1,249	)
			Other current assets		(5,325	)		11,893			(1,257	)
			Federal income tax recoverable		4,372			(1,753	)		2,695
			Accounts payable		9,415			(10,372	)		(9,055	)
			Other current liabilities		53,434			(36,871	)		(8,360	)
			Insurance and claims reserves		8,045			1,008			(8,441	)
			Accrued income taxes		(23	)		(1,368	)		2,091
			Other long-term assets and liabilities		9,260			16,942			23,085
Net cash provided by operating activities					30,396			115,123			67,232
Cash flows from investing activities:
	Additions of property and equipment				(55,377	)		(48,348	)		(33,463	)
	Proceeds from sale of property and equipment				15,592			3,477			5,282
	Purchases of investments				(55,941	)		(87,305	)		(66,999	)
	Proceeds from sale or maturity of investments				49,353			81,905			62,068
	Payment of agent contract costs				(2,233	)		(1,371	)		(1,762	)
	Acquisitions, net of cash acquired				(5,780	)		(21,357	)		(102,625	)
Net cash used for investing activities					(54,386	)		(72,999	)		(137,499	)
Cash flows from financing activities:
	Payment of debt issuance costs				—			—			(2,909	)
	Borrowings on revolving credit facility and short-term debt				283,899			379,549			330,265
	Repayments on revolving credit facility and short-term debt				(265,385	)		(417,492	)		(335,665	)
	Borrowings on mortgage warehouse facility				—			—			481,618
	Repayments on mortgage warehouse facility				—			—			(465,622	)
	Borrowings on relocation financing facilities				—			—			11,333
	Repayments on relocation financing facilities				—			—			(9,106	)
	Borrowings on long-term debt, excluding revolving credit facility				—			672			50,403
	Sale of equipment notes receivable				11,121			6,317			1,164
	Repayments on long-term debt				(6,811	)		(11,833	)		(26,894	)
	Repayments on capital lease obligations				(4,406	)		(2,482	)		(4,983	)
	Proceeds from issuance of common stock				29,406			—			66,315
	Payment of withholding tax on preferred stock dividends				(1,344	)		(1,442	)		(1,547	)
	Purchase of treasury stock				(5,623	)		(2,380	)		(1,893	)
	Other financing activities				3,395			(4,325	)		(10,343	)
Net cash provided by (used for) financing activities					44,252			(53,416	)		82,136
Effect of translation adjustments on cash					(1,886	)		(120	)		1,492
Net increase (decrease) in cash and cash equivalents					18,376			(11,412	)		13,361
Cash and cash equivalents at beginning of period					25,155			43,531			32,119
Cash and cash equivalents at end of period				$	43,531		$	32,119		$	45,480
Supplemental disclosure of cash flow information – cash paid during the years ended December 31, 2000, 2001 and 2002:
	Interest			$	64,892		$	56,649		$	45,343
	Income taxes			$	4,697		$	3,159		$	4,883

F-6

SIRVA, INC.
Notes to Consolidated Financial Statements

(Dollars in thousands except share and per share data)

(1)    Summary of Significant Accounting Policies

(a) Business Organization and Description

        This report covers SIRVA, Inc. (formerly known as Allied Worldwide, Inc., the "Company") and its wholly-owned subsidiaries North American Van Lines, Inc. ("NAVL"), CMS Holding, LLC ("CMS Holding") and RS Acquisition Holding, LLC.

        On March 29, 1998, the Company was incorporated and capitalized by Clayton, Dubilier & Rice Fund V Limited Partnership ("Fund V"). A wholly owned subsidiary of the Company was then capitalized for the purpose of acquiring all of the capital stock of NAVL from Norfolk Southern Corporation ("NS" and the "1998 acquisition"). The 1998 acquisition was accounted for as a purchase and resulted in a new basis of accounting for the Company. On November 19, 1999, the Company sold common stock to Fund V for the purpose of partially financing the acquisition of the NFC Moving Services Group ("Allied" and "the Allied Acquisition") from Exel plc ("Seller" formerly NFC plc). On May 3 and April 12, 2002, the Company sold additional common stock to Clayton, Dubilier & Rice Fund VI Limited Partnership ("Fund VI") for the purpose of completing the acquisitions of Cooperative Resource Services Ltd. ("CRS") and the business ("NAIT") of VCW, Inc. and its affiliate, National Association of Independent Truckers, Inc. See Note 2 for further information on these and other acquisitions. Fund V and Fund VI are private investment funds managed by Clayton, Dubilier & Rice, Inc. ("CD&R").

        The Company operates as a global provider of relocation and moving services to corporate clients, military and government agencies and the consumer market. In addition, the Company offers a variety of services targeted at meeting the needs of truck drivers, fleet owners and agents, both inside and outside of our proprietary agent network. The Company also provides inventory management solutions, using proprietary asset management technology, to coordinate a variety of services such as order fulfillment, project-specific delivery management, and tracing of products through a customer's supply chain.

        The Company markets its services under the brand names of SIRVA Relocation, northAmerican Van Lines, Allied Van Lines, Global Van Lines, Allied International, Pickfords, and Allied Pickfords, among others, with operations located throughout the United States, Canada, United Kingdom, Continental Europe, Australia, New Zealand and other Asia Pacific locations. The Company conducts its U.S. and Canadian operations primarily through a network of exclusive agents with approximately 1,300 locations. The Company conducts its other foreign business primarily through units that it owns and operates directly, using selected other affiliated representatives to geographically complete its service offering on a worldwide basis.

(b) Basis of Consolidation

        The consolidated financial statements include the accounts of the Company and its subsidiaries. All material intercompany accounts and transactions have been eliminated in consolidation.

(c) Cash Equivalents

        Cash equivalents are highly liquid investments purchased three months or less from original maturity.

(d) Contracts Receivable and Resale Equipment Inventory

        In the normal course of business, the Company sells tractors, trailers and other equipment ("resale equipment inventory") to its agents and to owner-operators under exclusive sales agreements ("contracts receivable"). Sales of equipment are financed by the Company, generally over a four year-period. Resale equipment inventory is recorded

F-7

at the lower of cost or net realizable value determined as the fair value of the equipment less the estimated cost to sell the equipment.

(e) Mortgages Held for Resale

        The mortgage lending services operation of the Company initiates mortgage loans for relocating employees. The loan inventory has corresponding purchase commitments from private investors. Mortgages held for resale are carried at the lower of cost or market. Cost is the outstanding principal balance of the mortgage notes reduced by the net deferred fees. In addition, certain direct costs are recognized upon sale. Commitments to sell loans are included in determining market value.

(f) Relocation Properties Held for Resale

        The Company purchases homes under certain relocation programs. These properties are held for resale and consist of residential homes carried at the lower of cost or market, as determined by appraisal of the properties. Homes in inventory are subject to mortgages payable by the transferees to various mortgage lenders. Accounts payable at December 31, 2002 include $16,568 of amounts payable to transferees for subsequent payoff of the mortgages on the related homes. As the homes are sold to an ultimate buyer, the mortgage payable is paid off at the time of closing on behalf of the transferees to satisfy the mortgage notes on the properties.

(g) Supplies Inventory

        Supplies inventory consists of pallets, blanket stock, crates, replacement and repair parts and tires and is valued at the lower of cost, determined using a first-in, first-out method, or market.

(h) Investments

        Investments consist of U.S. Treasury and corporate debt and equity securities and interests in joint ventures. Investments are classified as current or noncurrent based on their maturities and/or the Company's expectations of sales and redemptions in the following year. Interest and dividends on debt and equity securities are included in income as earned. The Company classifies its debt securities in one of two categories: available-for-sale or held-to-maturity. Held-to-maturity securities are those securities in which the Company has the ability and intent to hold the securities until maturity. All other securities are classified as available-for-sale.

        Available-for-sale securities are recorded at fair value. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums or discounts. Unrealized holding gains and losses, net of the related tax effect, on available-for-sale securities are excluded from earnings and are reported as a separate component of accumulated other comprehensive income until realized. Realized gains and losses from the sale of available-for-sale securities are determined on a specific identification basis.

F-8

(i) Property and Equipment

        Property and equipment are stated at cost. Depreciation is computed on a straight-line basis over the estimated useful lives of the respective assets. The estimated useful lives used in computing depreciation are summarized as follows:

	Useful Life
Buildings and improvements	20 to 40 years
Transportation equipment	4 to 15 years
Warehouse equipment	5 to 10 years
Computer equipment and software	3 to 5 years
Other	1 to 10 years

        Transportation equipment includes tractors, straight trucks, trailers, van equipment, containers and satellite-communication equipment. Salvage values are only calculated on tractors, straight trucks and trailers.

        Leased property and equipment meeting certain criteria are capitalized and the present value of the related lease payments is recorded as a liability. Depreciation of capitalized leased assets is computed on a straight-line basis over the shorter of the term of the lease or the useful life of the capitalized lease asset.

        The amount of internally developed software, representing primarily the cost of independent contractor developed software, that was capitalized during the years ended December 31, 2001 and 2002 was $10,370 and $6,937, respectively, and is included in computer equipment and software. The amount of capitalized interest related to internally developed software at December 31, 2001 and 2002 was $578 and $67, respectively. Amortization of capitalized software costs for the years ended December 31, 2000, 2001 and 2002 was $482, $2,513 and $3,390, respectively.

        Repairs and maintenance expenditures are charged to expense as incurred.

(j) Goodwill and Intangible Assets

        Intangible assets consist of trade names, customer relationships and covenants not to compete. Trade names, which have indefinite lives, and goodwill, are not amortized as of January 1, 2002. Customer relationships and covenants not to compete are amortized from 8 to 15 years and 3 to 5 years, respectively. See Note 6.

(k) Deferred Agent Contract Costs

        Deferred agent contract costs are payments made to certain agents for entering into long-term contracts with the Company. These payments are capitalized and amortized over the lives of the related contracts, which generally range from 3 to 10 years.

(l) Unearned Premiums and Other Deferred Credits

        Unearned premiums are related to the Network Services segment and deferred credits are related to the Relocation Solutions segments. See Note 1(n).

F-9

(m) Insurance and Claims Reserves

        The Company has purchased first dollar insurance coverage, subject to specified deductibles, for principally all insurable business risks except cargo damage, delay claims and the insurance services business loss reserves. The Company estimates costs relating to cargo damage and delay claims based principally on actuarial methods applied to historical trends. The Company's multiple-line property and commercial liability insurance group sets its reserve rates based on a percentage of earned premium. The percentage is based on historical data, run rates and actuarial methods.

        A cargo claims analysis is performed each quarter comparing open and closed claim costs, as well as estimates for incurred but not reported claim costs, to the original estimates, and changes to those estimates are recorded as appropriate. The Company recognized favorable accrual adjustments related to prior year estimates of $5,356 for the year ended December 31, 2002. These favorable adjustments were a result of improved experience, when compared to historical trends and estimates, for claims made in policy years 2001 and prior that were finalized in 2002. This improved claims experience was attributable to a combination of reduced shipment volumes that reduced the frequency of claims and new quality control initiatives implemented by the Company during 2001.

        The impact, net of taxes, of the favorable accrual adjustments was $3,436, or $0.07 per share-basic, or $0.07 per share-diluted.

(n) Revenue Recognition

        The Company's moving services operations recognize estimated gross operating revenue to be invoiced to the transportation customer and all related transportation expenses on the date a shipment is delivered or services are completed. Calculations by shipment are based upon estimated weights resulting from a survey of the home and the known distances between origin and destination. The estimate of revenue remains in a receivable account called Delivered Not Processed ("DNP") until the customer is invoiced. Concurrent with the DNP estimate, the Company recognizes an accrual for Purchased Transportation Expenses ("PTE") to account for the estimated costs of packing services, transportation expenses and other such costs associated with the service delivery. The estimate for PTE is not adjusted until the Company receives actual charges, which are typically within 30 days of the estimate.

        In the relocation services operations, fees are paid to the Company by corporate customers at either a fixed price per transferred employee or based upon a fixed percentage of the home's selling price. In either case, revenue is recognized when a home sale contract with the ultimate buyer is signed. However, if the Company purchases a property from the transferee when no outside buyer has been located and the property enters the Company's inventory, revenue is not recognized on that property until the closing of a sale to an outside buyer. Additionally, fees are paid to the Company by Company-qualified real estate agents for the listing or home purchase referral of a transferred employee and are recognized as revenue when a home sale contract with the ultimate buyer is signed.

        In addition, within relocation services, the Company recognizes gains or losses on the sale of mortgage loans at the date the loans are funded by purchasers pursuant to the existing sales commitment. The gain or loss equals the difference between the basis in the loan and the net proceeds received and are included in operating revenues in the consolidated statement of operations. Sales of loans are made without recourse, provided the loans meet predetermined specifications, as defined in the agreements with investors. The Company does not currently service mortgage loans.

        The Company, within the Network Services segment in the insurance services unit, recognizes revenue evenly over a twelve-month period when an annual insurance policy is written.

F-10

(o) Foreign Currency Translation

        A majority of the Company's foreign operations use the local currency as their functional currency. Assets and liabilities of these operations are translated to U.S. dollars at the exchange rates in effect on the balance sheet date. The impact of currency fluctuation is included in stockholders' equity as a component of accumulated other comprehensive income. Income statement items are translated at the average exchange rate.

(p) Income Taxes

        The Company follows Statement of Financial Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes" ("SFAS 109"). Under the asset and liability method of SFAS 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax laws and tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities due to a change in tax rates is recognized in income in the period that includes the enactment date. In addition, the amounts of any future tax benefits are reduced by a valuation allowance to the extent such benefits are not expected to be realized on a more likely than not basis.

(q) Use of Estimates

        The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Some of the areas where estimation is significant are as follows:

•

DNP is the estimated revenue associated with shipments delivered or services completed and not invoiced.



•

PTE is the associated purchased transportation expense that is estimated corresponding to the DNP revenue.



•

An allowance for doubtful accounts and notes receivable is maintained for estimated losses resulting from the inability of the Company's customers and agents to make required payments. If the financial condition of the Company's customers and agents were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. At December 31, 2001 and 2002 the Company had allowances of $10.3 million and $13.5 million, respectively, relating to fully reserved accounts receivable from terminated agents and owner/operators.



•

An allowance is maintained for the amount by which the estimated price to be received on the sale of the Company's relocation properties held for resale is less than the purchase price. If the Company experienced a further reduction in the market value of the homes in inventory, additional allowances may be required.



•

The Company offers certain incentives to its agents and corporate customers. Incentives offered to agents are based upon revenue growth targets. These are recognized ratably over the period of the incentive agreement as a component of general and administrative expenses. Incentives offered to corporate customers are based upon meeting certain revenue thresholds, and are recognized as a reduction in operating revenues ratably over the period of incentive. The Company estimates and accrues both incentives based upon actual progression towards achievement of the incentive targets. The Company recognized agent

F-11

incentives of $4.2 million, $3.9 million and $3.2 million in the years ended December 31, 2000, 2001 and 2002, respectively. In addition, the Company recognized customer incentives of $9.1 million, $8.8 million and $7.1 million in the years ended December 31, 2000, 2001 and 2002, respectively.

•

SFAS No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142") requires that an annual impairment review be performed, which requires the Company to place a fair value on the individual reporting units of the business. This required the Company to select an appropriate method of valuation for the business using discounted estimated cash flows and to assess assumptions inherent in such a method on an annual basis. In addition, whenever events or changes in circumstances indicate that the carrying value of goodwill and other indefinite-lived intangible assets might not be recoverable, the Company will perform an impairment review. The judgments made in determining whether goodwill and other intangible assets are impaired will directly affect reported operating income, since any time the Company determines that any of these assets are impaired, a charge will be recognized in the statement of operations equal to the decline in value of such assets.



•

The Company periodically assesses impairments of long-lived assets in accordance with the provisions of SFAS No. 144, "Accounting for the Impairment or Disposal of Long-lived Assets" ("SFAS 144"). An impairment review is performed whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors considered by the Company include, but are not limited to, significant underperformance relative to historical or projected future operating results; significant changes in the manner of use of the acquired assets or the strategy for the Company's overall business; and significant negative industry or economic trends. When the Company determines that the carrying value of a long-lived asset may not be recoverable based upon the existence of one or more of the above impairment indicators, the Company estimates the future undiscounted cash flows expected to result from the use of the asset and its eventual disposition. If the sum of these expected future undiscounted cash flows and eventual disposition is less than the carrying amount of the asset, the Company calculates an impairment loss. An impairment loss is equal to the difference between the fair value of the asset and its carrying value. Fair value is generally determined using a discounted cash flow methodology.



•

The Company provides a range of benefits to employees and retired employees, including defined benefit retirement plans, postretirement health care and life insurance benefits and postemployment benefits (primarily severance). The Company records annual amounts relating to these plans based on calculations specified by generally accepted accounting principles (GAAP), which include various actuarial assumptions, such as discount rates, assumed rates of return, compensation increases, turnover rates and health care cost trend rates. The Company reviews its actuarial assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when it is deemed appropriate to do so. As required by GAAP, the effect of the modifications is generally recorded or amortized over future periods. The Company believes that the assumptions utilized in recording its obligations under the plans are reasonable based on experience and advice from third-party actuaries.

(r) Accounting Change

        Effective January 1, 2001, the Company adopted SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities", as amended, ("SFAS 133"), which resulted in a change in method of accounting. The cumulative effect of this accounting change was a loss of $547 ($328, net of tax). SFAS 133 established accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other

F-12

contracts, and for hedging activities. It requires recognition of all derivatives as either assets or liabilities on the balance sheet and the measurement of those instruments at fair value. Changes in the fair value of derivatives will be recorded in each period in earnings or accumulated other comprehensive income ("OCI"), depending upon whether a derivative is designated and is effective as part of a hedge transaction and, if it is, the type of hedge transaction. If the derivative is designated and is effective as a cash flow hedge, the effective portions of the changes in the fair value of the derivative are recorded in OCI and are recognized as a component of general and administrative expense in the statement of operations when the hedged item affects earnings. Ineffective portions are recognized as a component of selling, general and administrative expense in earnings.

        Adopting the provisions of SFAS 133 had the following affect on the Company's earnings per share calculations:

	2000			2001			2002
Basic net income (loss) per share before cumulative effect of accounting change	$	(0.68	)	$	(0.47	)	$	0.33
Cumulative effect of accounting change, net of tax		—			(0.01	)		—
Basic net income (loss) per share after cumulative effect of accounting change	$	(0.68	)	$	(0.48	)	$	0.33

	2000			2001			2002
Diluted net income (loss) per share before cumulative effect of accounting change	$	(0.68	)	$	(0.47	)	$	0.33
Cumulative effect of accounting change, net of tax		—			(0.01	)		—
Diluted net income (loss) per share after cumulative effect of accounting change	$	(0.68	)	$	(0.48	)	$	0.33

(s) Recent Accounting Pronouncements

        In August 2001, the Financial Accounting Standards Board ("FASB") issued SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS 144"), superseding SFAS 121, effective for fiscal years beginning after December 15, 2001. The provisions of SFAS 144 are for long-lived assets to be disposed of by sale or otherwise are effective for disposal activities initiated by an entity's commitment to a plan after the initial date of adoption of SFAS 144. The Company adopted SFAS 144 on January 1, 2002. The adoption of SFAS 144 did not affect the Company's operating results or financial condition.

        In April 2002, the FASB issued Statement of Financial Accounting Standards No. 145, "Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections" ("SFAS 145"). The statement updates, clarifies and simplifies existing accounting pronouncements. The provisions SFAS 145 related to rescission of Statement 4 shall be applied in fiscal years beginning after May 15, 2002. The provisions in paragraphs 8 and 9(c) of the statement related to Statement 13 shall be effective for transactions occurring after May 15, 2002. The adoption of SFAS 145 did not have a material effect on the Company's operating results or financial condition.

        In June 2002, the FASB issued Statement of Financial Accounting Standards No. 146, "Accounting for Costs Associated with Exit or Disposal Activities" ("SFAS 146"). The statement requires companies to recognize costs associated with exit or disposal activities when they are incurred rather than at the date of a commitment to an exit or disposal plan. This statement replaces previous accounting guidance provided by EITF (Emerging Issues Task

F-13

Force) Issue No. 94-3. SFAS 146 is to be applied prospectively to exit or disposal activities initiated after December 31, 2002.

        In November 2002, the FASB issued Statement of Financial Accounting Standards Interpretation No. 45, "Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others" ("FIN 45"). The interpretation clarifies the requirements relating to a guarantor's accounting for, and disclosure of, the issuance of certain types of guarantees. The provisions for initial recognition and measurement of FIN 45 are to be applied on a prospective basis to guarantees issued on or modified after December 31, 2002. The Company will consider the recognition and measurement provisions of FIN 45 and its effect on the financial statements. The disclosure requirements are effective for fiscal years ending after December 15, 2002. The Company's guarantees are as follows:

•

The Company has guaranteed certain of its wholly owned foreign subsidiaries operating lines of credit. See Note 9.



•

Interest rate swap agreements and foreign exchange instruments with the Company's credit agreement banks are borrower obligations under the credit agreement, hence such agreements and instruments are secured and guaranteed. See Note 18.



•

The Company has guaranteed loans made to various members of management in connection with their investment in SIRVA. See Note 22.

        In December 2002, the FASB issued Statement of Financial Accounting Standards No. 148, "Accounting for Stock-Based Compensation – Transition and Disclosure" ("SFAS 148"), an amendment of Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation" ("SFAS 123"). This statement amends SFAS 123 to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation and amends the disclosure requirements to require prominent disclosure in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. The Company has adopted only the disclosure requirements of SFAS 148. See Note 16.

        Had the Company elected to apply the provisions of SFAS 123 and SFAS 148 regarding recognition of compensation expense to the extent of the calculated fair value of stock options granted, net income (loss) would have changed as follows:

	December 31, 2000			December 31, 2001			December 31, 2002
Net income (loss) as reported	$	(21,885	)	$	(16,884	)	$	20,821
Pro forma compensation cost under fair value method		(759	)		(407	)		(356	)
Adjusted net income (loss)	$	(22,644	)	$	(17,291	)	$	20,465
Basic net income (loss) per share, as reported	$	(0.68	)	$	(0.48	)	$	0.33
Basic net income (loss) per share, proforma	$	(0.70	)	$	(0.49	)	$	0.33
Diluted net income (loss) per share, as reported	$	(0.68	)	$	(0.48	)	$	0.33
Diluted net income (loss) per share, proforma	$	(0.70	)	$	(0.49	)	$	0.33

F-14

        In January 2003, the FASB issued Statement of Financial Accounting Standards Interpretation No 46, "Consolidation of Variable Interest Entities" ("FIN 46"). FIN 46 addresses consolidation by business enterprises of variable interest entities. The Company believes the adoption of FIN 46 will not have a material effect on operating results or financial condition. As of December 31, 2002, the Company had no variable interest entities.

(t) Reclassifications

        Certain reclassifications have been made to the consolidated financial statements for the prior periods presented to conform with the December 31, 2002 presentation.

(2)    Acquisitions and Equity Issuances

        On July 29, 2002, the Company acquired The Rowan Group PLC and Rowan Simmons Conveyancing Limited (together, "Rowan Simmons"), a U.K. based provider of relocation services, including home sale and purchase assistance, management of tenant responsibilities, and other services to corporations that assist employees in their relocation needs, for $14,242. The acquisition of Rowan Simmons provided the Company with an entrance into the U.K. corporate relocation market, one of the largest individual markets in Europe, and represented the continued strategic expansion of the Company's global corporate relocation service offering. The Company's decision to acquire Rowan Simmons was determined based on the need to service its relocation services customers throughout the world. The aggregate consideration was developed assessing a multiple of profits and cash flow as well as the strategic value to the Company for establishing this portion of its global relocation footprint. The European presence afforded by Rowan Simmons enabled the Company to immediately address the needs of larger relocation services customers and substantially strengthened the Company's global relocation services product offering. These factors made Rowan Simmons attractive to the Company and were a factor in the determination of purchase consideration, which after allocation to the acquired tangible assets and liablilities and acquired intangible assets, resulted in the recognition of goodwill. The values attributed to identified intangible assets were determined based on an independent third party valuation. The purchase price was funded from the proceeds of a bank loan. The cost to acquire Rowan Simmons has been preliminarily allocated to the assets acquired and liabilities assumed according to estimated fair values and is subject to adjustment when additional information concerning asset and liability valuations is finalized. The preliminary allocations resulted in acquired goodwill of $10,666, none of which is expected to be deductible for tax purposes. Rowan Simmons is included within the Relocation Solutions—Europe & Asia Pacific segment.

        On May 3, 2002, the Company, through two wholly owned subsidiaries, purchased the business conducted by CRS that provides comprehensive relocation services to companies and their employees, including home sale services, relocation coordination services and mortgage lending services. One of these two subsidiaries, SIRVA Relocation LLC ("SIRVA Relocation"), which is directly owned by NAVL, purchased the non-mortgage lending operations net assets and equity from CRS. The mortgage lending operations were purchased by the other subsidiary, CMS Holding which is directly owned by the Company. The acquisition of CRS represented the first stage of the Company's strategy of expanding its corporate relocation service offering, and provided a corporate relocation services business within the U.S. from which to expand the Company's customer base in this market. The Company believed that CRS had a strong reputation for quality and customer service and a product offering that was unique in the industry. The aggregate consideration was developed assessing a multiple of profits and cash flow, as well as the value to the Company for establishing itself as a significant provider of high quality corporate relocation services. The ability to immediately expand our presence in the market, acquire a talented workforce, provide a combined moving and relocation service offering to respond to customer demand, create substantial

F-15

cross-selling opportunities to provide moving services to relocation customers and relocation services to moving customers, and market CRS' unique product offering were key factors in the determination of purchase consideration, which after allocation to the acquired tangible assets and liabilities and acquired intangible assets, resulted in the recognition of goodwill. The values attributed to identified intangible assets were determined based on an independent third party valuation.

        Subject to certain adjustments, the combined cash purchase price for the acquisitions was $60,000, of which $3,500 was paid for the assets of the mortgage lending operations. Of the total purchase price, $45,000 was paid in cash and $15,000 (non-cash) was paid in notes issued by the Company. In addition, certain liabilities relating to the acquired business were assumed in connection with the acquisition, including $26,572 of indebtedness under a revolving credit facility used to fund the mortgage lending operations, which was assumed by CMS Holding. The cash purchase price for the acquisition, as well as $24,133 of other indebtedness of the acquired business that was retired as part of the acquisition, were financed with proceeds of $40,000 of cash from the sale of 8,929,605 shares of the Company's common stock to Fund VI, and the incurrence of $50,000 additional senior indebtedness by the Company. The cost to acquire CRS has been preliminarily allocated to the assets acquired and liabilities assumed according to estimated fair values and is subject to adjustment when additional information concerning asset and liability valuations is finalized. The preliminary allocation has resulted in acquired goodwill of $55,373 customer relationships of $29,100 and covenants not to compete of $6,300. The amortization periods for the definite-lived intangibles are 15 years and 5 years for the customer relationships and covenants not to compete, respectively. Of the $55,373 of acquired goodwill, an amount of $30,702 is expected to be deductible for tax purposes. CRS is included within the Relocation Solutions—North America segment.

        On April 12, 2002, the Company purchased the business ("NAIT") conducted by VCW, a leading provider of insurance services to independent contract truck drivers, and by certain of its affiliates, including the National Association of Independent Truckers, Inc., for $25,359 in cash, $3,611 in assumed net liabilities, a deferred amount of $3,000 payable subject to maintaining a certain number of insured members as of December 31, 2002 and 2003 and an actuarially determined amount of $7,428 to be paid during 2003 and 2004, based on insurance losses incurred with respect to policies issued during the year ended December 31, 2001. Through its Transguard Insurance unit, the Company offers insurance products tailored to the needs of the transportation industry that provide attractive financial returns. Historically, the primary market for these and other fleet services was the Company's network affiliates. The acquisition of NAIT expanded the potential sales channel for the Company's pre-existing insurance and fleet services to the member base of NAIT. The aggregate consideration for this acquisition was developed assessing both a multiple of profits and cash flow as well as the anticipated synergy benefits that were expected from cost efficiencies and further market penetration. The ability to sell our existing Network Services offerings to the NAIT membership base, cost efficiencies, and further market penetration were significant factors in the determination of purchase consideration, which after allocation to the acquired tangible assets and liablilities and acquired intangible assets, resulted in the recognition of goodwill. The values attributed to identified intangible assets were determined based on an independent third party valuation. NAIT is now part of our TransGuard General Agency. The National Association of Independent Truckers is an association of approximately 24,800 independent contract truck drivers that provides its members with occupational accident, physical damage and non-trucking liability insurance, as well as access to a suite of professional services. The purchase price was funded from existing cash and investment balances and $20,000 of cash from the sale of 4,464,818 shares of the Company's common stock to Fund VI. The cost to acquire NAIT has been preliminarily allocated to the assets acquired and liabilities assumed according to estimated fair values and is subject to adjustment when additional information concerning asset and liability valuations is finalized. The preliminary allocation has resulted in

F-16

acquired goodwill of $16,826, trade name of $12,300 member relationships of $6,100 and a covenant not to compete of $5,800. The amortization periods for the definite-lived intangibles are 8 years for member relationships and 5 years for the covenant not to compete. All of the acquired goodwill is expected to be deductible for tax purposes. NAIT is included within the Network Services segment.

        The following unaudited pro forma consolidated information presents the results of operations of the Company as if the acquisitions of CRS, NAIT and Rowan Simmons had taken place at the beginning of each period presented:

	Year Ended December 31, 2001			Year Ended December 31, 2002
Operating revenues	$	2,355,696		$	2,224,460
Income (loss) before cumulative effect of accounting change		(10,832	)		22,631
Cumulative effect of accounting change, net of tax		(843	)		—
Net income (loss)	$	(11,675	)	$	22,631

        The unaudited pro forma consolidated results have been prepared for comparative purposes only and do not purport to be indicative of the results of operations which would have actually resulted had the combinations been in effect on January 1, 2001, or of future results of operations.

        The following summary presents the estimated fair values of the assets acquired and liabilities assumed as of the date of the acquisitions:

	NAIT		ROWAN SIMMONS		CRS
Assets
Total current assets	$	129	$	4,034	$	104,767
Property and equipment, net		293		347		6,206
Goodwill		16,826		10,666		55,373
Tradenames		12,300		—		—
Customer lists		—		4,000		29,100
Member lists		6,100		—		—
Covenants not to compete		5,800		1,000		6,300
Other long-term assets		—		—		—
Total assets	$	41,448	$	20,047	$	201,746
Liabilities and stockholder's equity
Mortgage warehouse facility	$	—	$	—	$	26,572
Other current liabilities		4,033		3,631		81,144
Long-term liabilities		—		1,500		5,944
Stockholder's equity		37,415		14,916		88,086
Total liabilities and stockholder's equity	$	41,448	$	20,047	$	201,746

        On December 31, 2001, NAVL and Moveline, Inc. ("Moveline") completed a merger under an agreement and plan of merger dated as of November 9, 2001, through a stock-for-stock merger of Moveline and a wholly owned subsidiary of NAVL (the "Merger") with such subsidiary as the surviving corporation. Prior to the Merger, Fund V was the primary stockholder of both Moveline and the Company. In accordance with the accounting rules for mergers of entities under common control, the Company's merger with Moveline was accounted for in a manner similar to a pooling-of-interests since it was acquired from Fund V, the controlling shareholder of Moveline and the

F-17

Company. The Company's consolidated financial statements were restated to include the combined results of operations, financial position, and cash flows of Moveline since inception as though it had always been a part of the Company.

        On November 19, 1999, the Company completed the purchase of Allied from Exel for $450,000. The terms of the acquisition provided for an adjustment to the purchase price pertaining to the amount of net controllable assets acquired as of the date of the Allied Acquisition as determined by the Company and the Seller. The Company and Seller were unable to negotiate the final amount of net controllable assets acquired, therefore, per the terms of the acquisition agreement, a third party arbitrator was engaged for resolution of that amount. On September 12, 2001, the third party arbitrator rendered a binding determination to the Company and Seller. The arbitrator increased the net controllable assets and purchase price as estimated in the acquisition agreement by $18,087. Interest expense on the purchase price adjustment of $3,250 was paid for the period from the acquisition date to the date when the Company made payment. The acquisition agreement also contained indemnifications by the Seller for certain tax payments made by the Company on behalf of the Seller. These tax payments plus associated interest totaled $3,980 and were netted against the purchase price adjustment. Cash payment by the Company to the Seller on October 19, 2001, for the net purchase price adjustment totaled $17,357. The purchase price adjustment resulted in an increase to goodwill of $18,087.

(3)    Cash and Cash Equivalents

        Cash and cash equivalents included $13,474 and $22,422 at December 31, 2001 and 2002, respectively, relating to the Company's wholly owned insurance subsidiaries. While these cash balances may be used without limitation by the insurance subsidiaries for their operations, the payment of cash dividends by the insurance subsidiaries to the Company is principally dependent upon the amount of their statutory policyholders' surplus available for dividend distribution. The insurance subsidiaries' ability to pay cash dividends to the Company is, in turn, generally restricted by law or subject to approval of the insurance regulatory authorities of the states or countries in which they are domiciled. These authorities recognize only statutory accounting practices for determining financial position, results of operations, and the ability of an insurer to pay dividends to its shareholders. Based on statutory requirements at December 31, 2002, the maximum amount of ordinary dividends payable to the Company by its insurance subsidiaries during 2003 without the prior approval of appropriate regulatory authorities is $7,609.

F-18

(4)    Investments

        Investments consisted primarily of marketable debt and equity securities held by the Company's insurance subsidiaries and also joint ventures of $1 and $287 at December 31, 2001 and 2002, respectively. The marketable security investments included:

					December 31, 2001									December 31, 2002
			Fair Value		Amortized cost		Unrealized holding gains		Unrealized holding losses			Fair Value		Amortized costs		Unrealized holding gains		Unrealized holding losses
Current
	Available-for-sale
		Money market funds	$	5,984	$	5,984	$	—	$	—		$	7,062	$	7,062	$	—	$	—
Total current			$	5,984	$	5,984	$	—	$	—		$	7,062	$	7,062	$	—	$	—
Noncurrent
	U.S. government bonds		$	4,736	$	4,723	$	36	$	(23	)	$	8,241	$	8,239	$	2	$	—
	Asset-backed securities			20,573		20,375		260		(62	)		20,876		19,932		1,337		(393	)
	Municipal bonds			—		—		—		—			1,619		1,594		25		—
	Corporate bonds			18,104		17,275		1,943		(1,114	)		19,907		21,123		1,093		(2,309	)
	Preferred stock			8,784		8,767		17		—			7,280		8,385		318		(1,423	)
	Other invested assets			3,925		3,925		—		—			4,211		4,211		—		—
Available-for-sale				56,122		55,065		2,256		(1,199	)		62,134		63,484		2,775		(4,125	)
	Held to maturity
		U.S. government bonds		4,391		4,144		247		—			4,498		4,498		—		—
Total noncurrent			$	60,513	$	59,209	$	2,503	$	(1,199	)	$	66,632	$	67,982	$	2,775	$	(4,125	)

        Marketable security investments are exposed to various risks and rewards, such as interest rate, market and credit risk. Due to these risks and rewards associated with marketable security investments, it is possible that changes in the values of these investments may occur and that such changes could affect the amounts reported on the balance sheet. The Company holds investments in certain debt securities with the following aggregate maturities as of December 31, 2002:

Year	Held-to-maturity Cost		Available-for-sale Fair Value
2003	$	—	$	7,062
2004-2008		2,131		13,425
2009-2013		2,367		10,909
Thereafter		—		30,520
	$	4,498	$	61,916

        As of December 31, 2002, the Company holds investments of $7,280 in preferred stocks, which have an indefinite maturity.

F-19

        For the years ended December 31, 2000, 2001 and 2002, realized gains on sales of marketable security investments were $6,486, $5,424 and $2,121. The gains were recorded as a component of selling, general and administrative expense in the statement of operations.

(5)    Property and Equipment

        Property and equipment consisted of the following:

	December 31, 2001		December 31, 2002
Land	$	2,385	$	2,607
Buildings and improvements		40,289		41,730
Transportation equipment		91,538		102,589
Warehouse equipment		50,431		62,368
Computer equipment and software		62,563		96,014
Furniture, office equipment and other		7,627		14,572
Projects in process		25,230		14,548
		280,063		334,428
Less accumulated depreciation		114,696		163,171
	$	165,367	$	171,257

F-20

(6)    Goodwill and Intangible Assets

        Goodwill and intangible assets consisted of the following:

			December 31, 2001		December 31, 2002
Goodwill			$	261,637	$	345,226
	Less accumulated amortization			14,079		14,079
			$	247,558	$	331,147
Intangible assets:
	Tradenames		$	178,100	$	191,400
		Less accumulated amortization		12,429		12,429
				165,671		178,971
	Customer relationships			—		33,600
		Less accumulated amortization		—		1,430
				—		32,170
	Member relationships			—		6,100
		Less accumulated amortization		—		572
				—		5,528
	Covenants not to compete			—		13,400
		Less accumulated amortization		—		1,892
				—		11,508
Total intangible assets				178,100		244,500
	Less accumulated amortization			12,429		16,323
			$	165,671	$	228,177

        The changes in the gross carrying amount of goodwill for the year ended December 31, 2002 are as follows:

		Year Ended December 31, 2002
Balance as of January 1, 2002		$	261,637
Goodwill acquired:
	NAIT		16,826
	CRS		55,373
	Rowan Simmons		10,666
	Other acquisitions		724
Balance as of December 31, 2002		$	345,226

        In June 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142"), which requires that goodwill and intangible assets with indefinite useful lives no longer be amortized, but rather be tested for impairment at least annually. The

F-21

Company adopted the provisions of SFAS 142 effective January 1, 2002 and has discontinued the amortization of goodwill and intangible assets with indefinite useful lives. Trade names include the brand names northAmerican, Allied, Pickfords, Allied Pickfords and NAIT. Goodwill and trade names have been identified as having indefinite useful lives and were tested for impairment, using discounted estimated cash flows, consistent with the provisions of SFAS 142. The Company completed such testing and determined that there was no impairment of goodwill and trade names as of January 1 and December 31, 2002.

        The carrying amount of goodwill attributable to each reportable business segment was as follows:

	December 31, 2001		December 31, 2002
Relocation Solutions — North America	$	88,659	$	143,588
Relocation Solutions — Europe and Asia Pacific		121,782		133,872
Global Relocation Solutions		210,441		277,460
Network Services		47,530		64,118
Transportation Solutions		3,666		3,648
	$	261,637	$	345,226

        The following represents a comparison of results for the years ended December 31, 2000, 2001 and 2002, adjusted to exclude goodwill and trade names amortization expense:

	Year Ended December 31, 2000			Year Ended December 31, 2001			Year Ended December 31, 2002
Net income (loss), as reported	$	(21,885	)	$	(16,884	)	$	20,821
Amortization of goodwill and trade names		10,948			10,906			—
Income tax provision		(972	)		(974	)		—
Adjusted net income (loss)	$	(11,909	)	$	(6,952	)	$	20,821
Basic net income (loss) per ordinary share, as reported	$	(0.68	)	$	(0.48	)	$	0.33
Amortization of goodwill and trademarks	$	0.28		$	0.25			—
Income tax provision	$	(0.02	)	$	(0.02	)		—
Adjusted basic net income (loss) per ordinary share	$	(0.42	)	$	(0.25	)	$	0.33
Diluted net income (loss) per ordinary share, as reported	$	(0.68	)	$	(0.48	)	$	0.33
Amortization of goodwill and trademarks	$	0.28		$	0.25			—
Income tax provision	$	(0.02	)	$	(0.02	)		—
Adjusted diluted net income (loss) per ordinary share	$	(0.42	)	$	(0.25	)	$	0.33

        Amortization expense for definite-lived intangibles for the years ended December 31, 2000, 2001 and 2002 was $10,948, $10,906 and $3,894, respectively.

F-22

        Amortization of definite-lived intangible assets for the next five years is as follows:

	December 31, 2002
2003	$	5,833
2004		5,833
2005		5,833
2006		5,833
2007		3,477
	$	26,809

(7)    Other Current Liabilities

        Other current liabilities consisted of the following accruals:

	December 31, 2001		December 31, 2002
Sales, fuel and other non-income taxes	$	11,595	$	15,902
Interest and interest swap agreements		7,475		3,720
Customer and agent incentives		10,913		8,412
Restructuring expense		2,237		514
Escheat liability		2,199		2,243
Facilities expense		431		4,870
Customer relocation expense		—		6,592
Deferred purchase price consideration		—		7,072
General and administrative		7,954		7,837
Other		12,198		7,376
	$	55,002	$	64,538

(8)    Income Taxes

(a) Provision (Benefit) for Income Taxes

        The Company and its wholly owned domestic subsidiaries file a consolidated federal income tax return.

        The components of income (loss) before income taxes and cumulative effect of accounting change are:

	Year Ended December 31, 2000			Year Ended December 31, 2001			Year Ended December 31, 2002
U.S. operations	$	(38,475	)	$	(41,448	)	$	11,168
Foreign operations		14,808			24,761			21,284
	$	(23,667	)	$	(16,687	)	$	32,452

F-23

        The provision (benefit) for income taxes includes:

		Year Ended December 31, 2000			Year Ended December 31, 2001			Year Ended December 31, 2002
Current:
	Federal	$	1,100		$	(3,802	)	$	1,614
	Foreign		3,596			6,225			7,894
	State		669			938			566
Total current taxes			5,365			3,361			10,074
Deferred:
	Federal		(7,059	)		(3,003	)		1,847
	Foreign		847			2,613			(402	)
	State		(935	)		(3,102	)		112
Total deferred taxes			(7,147	)		(3,492	)		1,557
Provision (benefit) for income taxes		$	(1,782	)	$	(131	)	$	11,631

(b) Reconciliation of Statutory Rate to Effective Rate

        Total income taxes as reflected in the Consolidated Statements of Operations differ from the amounts computed by applying the statutory federal corporate tax rate as follows:

	Year Ended December 31, 2000			Year Ended December 31, 2001			Year Ended December 31, 2002
Federal income tax at statutory rate	$	(8,283	)	$	(5,840	)	$	11,358
State income taxes, net of federal tax benefit		(173	)		(1,407	)		441
Foreign income taxes		3,747			3,066			551
Intangibles amortization		2,102			2,161			—
Other – net		825			1,889			(719	)
Provision (benefit) for income taxes	$	(1,782	)	$	(131	)	$	11,631

F-24

(c) Deferred Tax Assets and Liabilities

        Deferred taxes related to the following:

		December 31, 2001		December 31, 2002
Deferred tax assets:
	Property and equipment	$	1,089	$	228
	Reserves, including casualty and other claims		32,640		27,481
	Employee benefits		7,239		6,372
	Taxes other than income taxes		2,039		1,841
	Postretirement benefits other than pensions		9,417		10,143
	Net operating loss carryforwards		19,684		20,088
	Pension obligation		4,432		16,266
	Unrealized gains and other		10,665		9,939
Total gross deferred tax assets			87,205		92,358
Less valuation allowance			211		646
Net deferred tax asset			86,994		91,712
Deferred tax liabilities:
	Foreign earnings		5,048		4,319
	Property and equipment		4,291		5,305
	State income taxes		2,196		1,988
	Intangibles		64,794		71,886
Total gross deferred tax liabilities			76,329		83,498
Net deferred tax assets			10,665		8,214
Less net current deferred tax assets			37,051		37,151
Net long-term deferred tax liability		$	26,386	$	28,937

        At December 31, 2001 and 2002, a valuation allowance has been established due to the uncertainty of realization of foreign net operating loss ("NOL") carryforwards. The net change in the total valuation allowance for the period ended December 31, 2002 was an increase of $435. The increase was the result of additional losses generated in jurisdictions where realization is uncertain. The domestic NOL carryforwards expire between the years 2020 through 2022. Management believes it is more likely than not all other domestic deferred tax assets will be realized based on the Company's anticipated future taxable earnings or available tax planning alternatives.

(d) Taxing Authority Reviews

        Consolidated federal income tax returns of the Company, while owned by NS, have been examined and Revenue Agent Reports have been received for all years up to and including 1996. The Company is currently under examination for the years 1997 and 1998. NS will indemnify the Company for any tax liabilities prior to the 1998 Acquisition to the extent they were not accrued at the purchase date. Consolidated federal income tax returns of Allied have been examined and Revenue Agent Reports have been received for all years up to and including the Allied fiscal year ended September 30, 1995. Exel plc will indemnify the Company for any Allied Acquisition companies' tax liabilities related to periods prior to the Allied Acquisition.

F-25

(9)    Short-term Debt

        Short-term borrowings consisted of the following:

	December 31, 2001		December 31, 2002
Foreign subsidiaries lines of credit	$	1,235	$	1,074
Revolving credit facility		46,000		—
Mortgage warehouse facility		—		41,893
Relocation financing facilities		—		15,432
Rowan Simmons note payable		—		14,000
	$	47,235	$	72,399

        Certain wholly owned foreign subsidiaries maintain operating lines of credit totaling $25,943. Interest is payable monthly or quarterly at the bank's base or prime rate (currently 4.0%-8.0%) plus 0.25%-1.0%, and include commitment fees ranging from 0%—0.25% on the unused portion of the line. As of December 31, 2001 and 2002, the outstanding balance was $1,235 and $1,074, respectively. Certain of these agreements are guaranteed by the Company.

        During the second quarter 2002, the Company determined that, due to a change in the use of the revolving credit facility borrowings, it should be classified as a component of long-term debt. The revolving credit facility is a component of the Company's credit agreement, which matures in 2006. See Note 10.

        A revolving warehouse facility is maintained by two of the Company's subsidiaries. SIRVA Mortgage, Inc. maintains a $56,000 revolving warehouse facility with an outstanding balance of $41,893 at December 31, 2002. Interest is payable monthly at London Interbank Offered Rate ("LIBOR") plus 1.75% (effective rate of 3.18% at December 31, 2002). A commitment fee of 0.125% is charged on the entire facility and is payable quarterly. $28,000 of the facility matures on July 31, 2003 and the remaining $28,000 matures on July 31, 2004.

        Rowan Simmons maintains a $60,000 relocation financing facility with certain U.K. banks with an outstanding balance of $15,432 at December 31, 2002. Interest is payable monthly or quarterly, depending on the lender, at a rate of 4% plus 0.85%—1.5% (effective rate of 4.85%—5.5% at December 31, 2002). A commitment fee of 0.125% is charged on the undrawn amount each day and is paid annually.

        In connection with the acquisition of Rowan Simmons, the Company incurred a $14,000 note payable with a bank. Interest is paid on its maturity date of April 26, 2003 and is calculated at LIBOR plus 0.75% (effective rate of 2.17% at December 31, 2002.

(10)    Long-term Debt

        On November 19, 1999, in connection with the Allied Acquisition, the Company entered into debt and indenture agreements to refinance existing indebtedness and to finance a portion of the Allied Acquisition. The Company's credit agreement (the "Credit Agreement") with J.P. Morgan Chase & Co. and a consortium of other lenders consists of a revolving credit facility (the "Revolving Credit Facility") and two term loans.

F-26

        Long-term debt consisted of the following:

	December 31, 2001		December 31, 2002
Revolving credit facility	$	—	$	27,000
Note payable – Tranche A		135,000		120,000
Note payable – Tranche B		171,500		209,887
Senior subordinated notes		150,000		150,000
Senior discount loan		48,197		56,578
Other		868		16,657
Total debt		505,565		580,122
Less current maturities		16,958		22,412
Total long-term debt	$	488,607	$	557,710

(a) Revolving Credit Facility

        Under the Revolving Credit Facility, as amended and restated, the Company may borrow up to $150,000, which includes a $10,000 swing line subfacility and a $50,000 letter of credit subfacility, until its scheduled maturity on November 18, 2006. Advances must be made in increments of no less than $5,000 or multiples of $1,000 in excess thereof. If lesser amounts are required, then the swing line subfacility may be activated. Borrowing under the Revolving Credit Facility was $46,000 and $27,000 at December 31, 2001 and 2002, respectively. A commitment fee of 0.5% is charged on the unused portion of the Revolving Credit Facility and is payable quarterly. The Company had outstanding letters of credit of $15,819 and $29,347 at December 31, 2001 and 2002, respectively, primarily in conjunction with its insurance agreements. The Company has available credit of $88,181 and $93,653 at December 31, 2001 and 2002, respectively.

        Interest is payable at ABR rates (based on prime, base certificate of deposit or federal funds effective rates), plus a margin of 2.0% (effective rate of 6.25% as of December 31, 2002) or LIBOR, plus a margin of 3.0% (effective rate of 4.43% as of December 31, 2002). The weighted average interest rates for the years ended December 31, 2001 and 2002 were 7.29% and 4.86%, respectively. The rate selected is determined by the facility/subfacility from which the borrowings are drawn, the maturity date of the loan and the required notice of the borrowing. ABR interest is payable at the end of each quarter and LIBOR interest is payable in arrears on the last day of the loan period for loans less than three months and at the end of each quarter for loans greater than three months. Principal is repaid as funds are available.

(b) Notes Payable – Tranche A and Tranche B

        In connection with the Allied Acquisition, the Company issued two term loans, as amended and restated, amounting to $150,000 (Note Payable Tranche A) and $175,000 (Note Payable Tranche B), respectively. Notes payable Tranche A and Tranche B are senior notes, collateralized by substantially all the assets of the Company, payable in consecutive quarterly interest and principal installments, commencing on March 24, 2000, through maturity of November 18, 2006 and November 18, 2007, respectively. On April 30, 2002, as part of the financing of the acquisition of CRS, the Company amended its credit agreement to increase Note Payable Tranche B by $50,000. The incremental facility is subject to the same terms and conditions of the Credit Agreement.

F-27

        Interest is payable at ABR or LIBOR, plus an applicable margin, which corresponds to the achievement of certain performance criteria determined from the financial statements. At December 31, 2001 and 2002, Tranche A interest was accruing at LIBOR, plus 3%, (5.10% and 4.50%) and Tranche B interest was accruing at LIBOR, plus 4%, (6.10% and 5.42%), respectively.

        The Credit Agreement, as amended and restated, governing Note Payable Tranche A, Note Payable Tranche B and the Revolving Credit Facility contains a number of covenants that limit, among other things, the incurrence of additional indebtedness, the incurrence of capital lease obligations and purchase of operating property, and the payment of dividends to the Company. While the Credit Agreement generally permits dividends and distributions on the capital stock of NAVL's subsidiaries to NAVL, such dividends and distributions from NAVL to the Company are limited to a fixed dollar amount, subject to exceptions allowing for transfers to fund the Company's operating expenses in the ordinary course of business. The Credit Agreement also requires the Company to maintain certain financial tests, including a consolidated interest coverage ratio and a leverage ratio, and includes a general lien on certain of the Company's assets. The agreement also includes certain cross default provisions such that a default under any other loan agreements by the Company would cause a default in the Credit Agreement. The consolidated leverage ratio and interest coverage ratio at December 31, 2002 were 3.77 and 2.89, respectively, compared to required ratios of less than 4.60 to 1.00 and more than 2.35 to 1.00, respectively.

        On March 28, 2002, the Company made a $21,904 prepayment of Tranche A and Tranche B debt due to excess cash flow in 2001, as defined in the credit agreement. A total of $4,188 replaced principal payments due at that time, with the remaining $17,716 reducing future principal payments.

(c) Senior Subordinated Notes

        In connection with the Allied Acquisition, the Company, through its wholly-owned subsidiary, NAVL, issued $150,000 aggregate principal amount of 13.375% Senior Subordinated Notes ("Senior Subordinated Notes") due December 1, 2009. Each note bears interest at a rate of 13.375% per annum and is payable in semi-annual installments on June 1 and December 1 each year to holders of record at the close of business on the May 15 or November 15 immediately preceding the interest payment date.

        The Senior Subordinated Notes are unsecured senior subordinated indebtedness of the Company. They are subordinated in right of payment, as set forth in the Senior Subordinated Notes Indenture ("Indenture"), to the payment when due in full cash of all existing and future senior indebtedness of the Company. These Senior Subordinated Notes have been guaranteed by certain domestic subsidiaries of the Company.

        The Indenture and the agreements governing this debt contain a number of similar less restrictive covenants as those included in the Credit Agreement described above. The Indenture restricts dividends and distributions by NAVL to the Company in a manner similar to the Credit Agreement, and in addition permits dividends based upon a fixed percentage of the Company's accumulated net income over specified periods as determined after specified adjustments.

(d) Senior Discount Loan

        In connection with the Allied Acquisition, the Company incurred $35,000 initial value of unsecured senior discount term loan borrowings with a lender, due December 1, 2007. The senior discount loan will accrete until December 1, 2004 at a rate of 16.00% per annum, and is payable in semi-annual installments as of June 1 and December 1, commencing June 1, 2005 payable 15 days in advance, for each year to the lender at the close of

F-28

business on the May 15 or November 15 immediately preceding the interest payment date. The amount of accretion in 2001 and 2002 was $6,862 and $8,381, respectively, which was accounted for as a non-cash transaction.

        The agreements governing the senior discount loan contain a number of covenants that limit, among other things, the incurrence of additional indebtedness by the Company and its domestic and foreign subsidiaries, and dividends or distributions to the Company's stockholders in a manner similar to that described with respect to the Indenture above.

        On November 12, 2002, a subsidiary of Fund VI purchased the senior discount loan from its holders.

(e) Other

        On May 3, 2002, as part of the financing of the acquisition of CRS, the Company issued two 10% notes payable, Seller Note A amounting to $10,000 and Seller Note B amounting to $5,000 (the "Seller Notes"). The Seller Notes are subordinated to the Company's senior debt. Seller Note A is due May 3, 2007. Seller Note B is due May 3, 2012 or May 3, 2007, if certain conditions are met. On a quarterly basis, 50% of the interest on the outstanding principal amount will accrete and be added to the principal amount and 50% will be paid in cash. The amount of accretion at December 31, 2002 was $339 and $169 for Seller Note A and Seller Note B, respectively.

        Future maturities of long-term debt are as follows:

	December 31, 2002
2003	$	22,412
2004		22,558
2005		56,058
2006		170,852
2007		158,020
Thereafter		150,222
	$	580,122

        The fair value of the Company's long-term debt approximates the carrying amount based on the present value of cash flows discounted at the current rates offered to the Company on similar debt instruments.

(11)    Capital and Operating Leases

        During 2002, the Company entered into two vehicle and one communications equipment lease agreements totaling $1,338 (non-cash). The leases are being accounted for as capital leases and require the Company to pay customary operating and repair expenses that will keep the assets in roadworthy and appropriate condition through the termination dates of 2007 and 2012. The leases do not contain purchase options.

        During 2001, the Company entered into two trailer lease agreements (non-cash) totaling $3,833 and a tractor satellite-communication equipment lease agreement in the amount of $563 (non-cash). Each of these leases is being accounted for as a capital lease and requires the Company to pay customary operating and repair expenses that will keep these assets in operating condition. The trailer leases contain purchase options at amounts approximating fair market value at lease termination in 2008. The tractor satellite-communication equipment lease contains a bargain purchase option of $1 at lease termination in 2006.

F-29

        During 2001, the Company also entered into two vehicle lease agreements totaling $9,870 (non-cash). Both of the leases are being accounted for as capital leases and require the Company to pay customary operating and repair expenses that will keep the assets in roadworthy condition through the termination dates of 2008 and 2010. The vehicle leases do not contain purchase options, however, the Company has the right to share in any profits made from the sale of the assets by the financing company after the lease termination date.

        The Company has noncancelable lease commitments under operating leases for rental of office space, warehouse facilities, transportation equipment and office equipment. The Company's rental expense under these operating leases was $35,693, $52,438 and $58,911 for the years ended December 31, 2000, 2001 and 2002, respectively.

        Future minimum rental payments under capital lease obligations and operating leases at December 31, 2002 are as follows:

	Capital Leases		Operating Leases
2003	$	5,840	$	48,980
2004		4,145		39,234
2005		3,548		36,273
2006		3,529		26,997
2007		2,642		24,353
Thereafter		2,380		102,929
Total minimum lease payments		22,084	$	278,766
Less interest		3,113
Present value of net minimum lease payments		18,971
Less current portion		4,849
Long-term portion of capital lease obligation	$	14,122

        Assets under capital leases consist of the following:

	December 31, 2001		December 31, 2002
Transportation equipment	$	27,361	$	29,939
Less accumulated depreciation		6,434		10,861
	$	20,927	$	19,078

(12)    Retirement and Postretirement Medical Plans

(a) Defined Benefit Plans

        The Company has several defined pension plans covering substantially all of its domestic employees and certain employees in other countries. Pension benefits earned are generally based on years of service and compensation during active employment, however, the level of benefits and terms of vesting may vary among plans. Pension plan assets are administered by trustees and are principally invested in equity securities, fixed income securities and pooled separate accounts. The funding of pension plans is determined in accordance with statutory funding requirements.

F-30

        The domestic defined pension plans were amended effective April 1, 2002, for the purpose of combining the plans into one benefit plan covering all domestic employees. This single pension plan was then frozen effective December 31, 2002, which triggered curtailment accounting treatment due to the elimination of benefits earned for future years of service. The curtailment amounts recorded are reflected in the table below.

        The Company also has an Excess Benefit Plan and an Executive Retirement and Savings Plan which are unfunded nonqualified plans that provide retirement benefits not otherwise provided under the qualified plan because of the benefit limitations imposed by Section 415 and 401(a)(17) of the Internal Revenue Code. These Plans ensure that an executive receives the total pension benefit to which he/she otherwise would be entitled, were it not for such limitations. The expense associated with the Excess Benefit Plan is included within the Pension Benefits table below. For the years ended December 31, 2000, 2001 and 2002, the expense associated with the Executive Retirement and Savings Plan was $250, $496 and $556, respectively.

        In addition, the Overlap Benefit Plan for various domestic employees, an unfunded, nonqualified retirement plan, provides retirement benefits forfeited by the highly compensated employees under the Qualified Plan because of the changes to the retirement plan formula which were effective April 18, 1989.

        Eligible employees of Pickfords Limited, the Company's United Kingdom subsidiary, continued to be eligible for a defined benefit plan of the Seller through April 5, 2000. At the time of the Allied Acquisition, the Company provided each participant with the opportunity to join its defined benefit plan. Substantially all the eligible participants elected to join. The Company has recognized net periodic pension costs associated with the plan since the participant election date of April 5, 2000. On September 19, 2001, the benefit obligation and plan assets related to prior service costs for this plan were determined by an independent actuary and transferred from the Seller. In conjunction herewith, the loss in fair value of plan assets from the Allied Acquisition date to September 19, 2001 has been reflected as a reduction in plan asset value prior to the transfer of $19,322. As of December 31, 2001 and 2002, the Company had recorded a prepaid pension asset of $8,103 and $6,448, respectively.

        Information on the Company's domestic and foreign defined benefit plans and amounts recognized in the Company's consolidated balance sheets, based on actuarial valuation, are as follows:

		Combined Plans Excluding United Kingdom						United Kingdom
		December 31, 2001			December 31, 2002			December 31, 2001			December 31, 2002
Change in benefit obligation
Benefit obligation at beginning of period		$	89,247		$	96,897		$	54,515		$	52,293
Service cost			2,926			2,660			3,136			3,793
Interest cost			6,657			6,964			3,179			3,307
Plan participants' contribution			—			—			1,601			1,764
Actuarial (gain)/loss			3,428			11,022			(8,155	)		(1,758	)
Plan amendments			—			(4,901	)		—			—
Curtailments			—			(3,142	)		—			—
Benefits paid			(5,147	)		(5,019	)		(582	)		(644	)
Currency translation			(214	)		209			(1,401	)		5,551
	Benefit obligation at end of period	$	96,897		$	104,690		$	52,293		$	64,306

F-31

Change in plan assets
Fair value of plan assets at beginning of period	$	88,788		$	80,404		$	74,830		$	62,544
Reduction in plan asset value prior to transfer		—			—			(19,322	)		—
Actual return on plan assets		(3,444	)		(9,979	)		7,941			(12,390	)
Employer contribution		124			12			—			—
Plan participants' contribution		—			—			1,601			1,764
Benefits paid		(5,064	)		(4,924	)		(582	)		(644	)
Currency translation		—			—			(1,924	)		6,641
Fair value of plan assets at end of period	$	80,404		$	65,513		$	62,544		$	57,915
Funded status reconciliation
Funded status	$	(16,493	)	$	(39,177	)	$	10,251		$	(6,391	)
Unrecognized net actuarial (gain)/loss		21,195			44,636			(2,148	)		18,169
Net transition obligation		—			—			—			(5,330	)
Prepaid benefit cost	$	4,702		$	5,459		$	8,103		$	6,448
Amounts recognized in the consolidated balance sheet
Cost transferred from seller	$	—		$	—		$	8,368		$	—
Prepaid pension asset at beginning of year		—			—						8,103
Accrued benefit liability		(9,416	)		(39,177	)		—			—
Intangible asset		41			—			—			—
Accumulated other comprehensive income		14,077			44,636			—			—
Net change in prepaid benefit (November 19 — December 31)		—			—			(265	)		—
Net change in prepaid benefit		—			—			—			(1,655	)
Net amount recognized	$	4,702		$	5,459		$	8,103		$	6,448

        The cumulative income tax impact of the accumulated other comprehensive income line item shown in the table above was $5,647 and $17,854 as of December 31, 2001 and 2002, respectively. The changes within stockholders' equity in note 15 are presented net of tax.

        The following actuarial assumptions were used for the Company's pension plans:

	Combined Plans Excluding United Kingdom						United Kingdom
	December 31, 2000		December 31, 2001		December 31, 2002		December 31, 2001		December 31, 2002
Weighted-average assumptions
Discount rate	7.50	%	7.25	%	6.75	%	5.75	%	5.60	%
Expected return on plan assets	9.00	%	9.00	%	9.00	%	7.75	%	7.75	%
Rate of compensation increase	4.00-5.00	%	4.00-5.00	%	4.00	%	4.00	%	4.00	%

F-32

        Information on the Company's significant domestic and foreign defined benefit plans and amounts recognized in the Company's consolidated statements of operations, based on actuarial valuation, are as follows:

	Combined Plans Excluding United Kingdom									United Kingdom
	December 31, 2000			December 31, 2001			December 31, 2002			December 31, 2001			December 31, 2002
Components of net periodic benefit cost
Service cost	$	3,240		$	2,926		$	2,660		$	3,136		$	3,793
Interest cost		6,294			6,657			6,964			3,179			3,307
Expected return on plan assets		(8,560	)		(7,837	)		(7,036	)		(5,710	)		(5,411	)
Amortization of recognized actuarial (gain)/loss		(28	)		135			1,075			68			827
Net periodic benefit cost		946			1,881			3,663			673			2,516
Special termination liability		1,438			—			—			—			—
Prior service benefit curtailment gain		—			—			(4,531	)		—			—
Net periodic benefit cost after curtailment and settlements	$	2,384		$	1,881		$	(868	)	$	673		$	2,516

        The Company recognizes an accrued benefit liability in its financial statements for its unfunded Excess Benefit Plan and Overlap Benefit Plan. The accrued benefit cost at December 31, 2001 and 2002 included $1,012 and $1,228, respectively, related to this liability.

        The Company intends to fund at least the minimum amount required under the Employee Retirement Income Security Act of 1974, as amended, for its domestic plans and the Pensions Act 1995 for its U.K. plan.

        The Company's Canadian subsidiary, ALNAV Platinum Group, Inc., has a defined benefit plan (the "Canada Plan") with the benefits generally based upon years of service and the highest five-year average salary during employment. As of December 31, 2001 and 2002, the accumulated benefit obligation of accrued pension benefits was $1,403 and $1,494, respectively, and the aggregate market value of pension plan assets was $1,772 and $1,669, respectively. As of December 31, 2001 and 2002, the prepaid pension cost was $190 and $175, respectively. The (income) expense associated with the plan for the years ended December 31, 2000, 2001 and 2002 was $(61), $53 and $59, respectively. The Canada Plan terminated as of January 1, 2001. Pursuant to the Canadian Pension Benefits Standards Act, pension benefits accrued as of January 1, 2001 are fully vested for all affected members and wind-up notices were distributed to them on December 27, 2000. The Office of the Superintendent of Financial Institutions has approved the wind-up report. Distribution of assets is expected to occur during 2003.

(b) Postretirement Medical Plan

        The Company has a nonpension postretirement benefit plan for certain domestic employees that provide specific health care and death benefits to eligible retired employees. Under the present plan, which may be amended or terminated at the Company's option, a defined percentage of health care expenses is covered, after reductions for any deductibles, co-payments, Medicare payments and, in some cases, coverage provided by other group insurance policies. The cost of such health care coverage to a retiree may be determined in part by a retiree's years of vested service with the Company prior to retirement. Death benefits are based on a fixed amount at time of retirement.

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        The plan covering certain domestic employees was amended effective April 1, 2002, to include substantially all of its domestic employees. This amendment also eliminated benefits after age 65. Effective December 31, 2002, the plan was amended to eliminate any subsidies to employees that have not reached 50 years of age with a minimum of 10 years of service as of December 31, 2002. This amendment triggered curtailment accounting treatment. The curtailment amounts recorded are reflected in the table below.

		December 31, 2001			December 31, 2002
Change in benefit obligation
Benefit obligation at beginning of period		$	15,611		$	18,990
Service cost			1,158			764
Interest cost			1,293			1,201
Plan participants' contribution			57			77
Actuarial loss			2,051			3,137
Plan amendments			—			(5,330	)
Curtailment gains			—			(1,225	)
Benefits paid			(1,180	)		(881	)
	Benefit obligation at end of period	$	18,990		$	16,733
Plan status reconciliation and amounts Recognized in the consolidated balance sheets
Plan status		$	(18,990	)	$	(16,733	)
Unrecognized net actuarial loss			847			614
Accrued benefit cost and net amount recognized		$	(18,143	)	$	(16,119	)

	December 31, 2000			December 31, 2001		December 31, 2002
Components of net periodic benefit cost
Service cost	$	892		$	1,158	$	764
Interest cost		949			1,293		1,201
Amortization of recognized actuarial (gain)/loss		(39	)		12		(346	)
Net periodic benefit cost		1,802			2,463		1,619
Special termination liability		1,570			—		—
Prior service benefit curtailment gain		—			—		(2,839	)
Net periodic benefit cost after curtailment and settlements	$	3,372		$	2,463	$	(1,220	)

        The following actuarial assumptions were used for the Company's postretirement plans:

	December 31, 2000		December 31, 2001		December 31, 2002
Weighted-average assumptions
Discount rate	7.50	%	7.25	%	6.75	%
Health care cost trend rates	7.00	%	8.50	%	12.00	%

        The health care cost trend rate was assumed to decrease gradually to 5.5% for 2009 and remain at that level thereafter.

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        Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A one-percentage-point change in the assumed health care cost trend rate would have the following effects:

	One-Percentage Point
	Increase		Decrease
Effect on total of service and interest cost components	$	330	$	(280	)
Effect on postretirement benefit obligation	$	2,140	$	(1,870	)

(c) Defined Contribution Plans

        In 1994, the Company's United Kingdom subsidiary, North American (UK), Ltd., established a contributory defined contribution plan for eligible employees. The plan is funded through contributions from employees, generally 3% of earnings, which are matched by the Company. The expense associated with the plan was $47, $36 and $62 for the years ended December 31, 2000, 2001 and 2002, respectively.

        Effective April 1, 2002, the Allied Van Lines, Inc. Profit Sharing and Retirement Savings Plan was merged with the NAVL Employees Savings Plan and Trust and was renamed the SIRVA Employee Retirement Savings Plan. The plan qualifies under Section 401(a) and 401(k) of the Internal Revenue Code. The Company has made no contributions to the NAVL or SIRVA plan since its inception. Prior to 2002, the Company made matching contributions based on Allied participant contributions to the plan and also contributed a profit-sharing contribution which was 4% of the eligible compensation of each participant. The Company made contributions of $1,216, $1,225 and $0 for the years ended December 31, 2000, 2001 and 2002, respectively.

(13)    Postemployment Medical Plan

        The Company provides certain postemployment health care continuation benefits to inactive NAVL employees and their dependents during the period following employment but before retirement. As of December 31, 2001 and 2002, the accumulated postemployment benefit obligation for such benefits was $2,012 and $1,936, respectively. The expense associated with the plan was $196, $789 and $152 for the years ended December 31, 2000, 2001 and 2002, respectively.

(14)    Incentive Compensation

        The Company maintains a Management Incentive Plan for certain executives and key management employees. The plan is administered by the Board of Directors whose members do not participate in the plan. For the years ended December 31, 2000 and 2001, the Company maintained a Performance Incentive Plan for eligible employees not included in the Management Incentive Plan. The plan was administered by the Vice President of Compensation and Benefits, who did not participate in the plan. Incentive compensation was based upon achievement of certain predetermined corporate performance goals. The expense associated with both of the incentive plans was $8,133, $147 and $4,500 for the years ended December 31, 2000, 2001 and 2002, respectively.

        In addition to the Management Incentive Plan and the Performance Incentive Plan, the Company administers several other incentive plans that were in place prior to the acquisitions of Allied, NAIT and CRS. These plans are administered by the Vice President of Compensation and Benefits and are based on achievement of certain predetermined segment performance goals. The expense associated with these plans was $1,280, $952 and $2,661 for the years ended December 31, 2000, 2001 and 2002, respectively.

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(15)    Stockholders' Equity, Redeemable Common Stock and Redeemable Junior Preferred Stock

Following is an analysis of stockholders' equity, redeemable common stock and redeemable junior preferred stock:

	Stockholders' Equity
	Total			Accumulated deficit			Accumulated other comprehensive income (loss)			Common stock		Common stock purchase warrant		Additional paid-in- capital			Treasury stock			Redeemable common stock			Redeemable junior preferred stock
Balance at December 25, 1999	$	99,801		$	(21,672	)	$	(136	)	$	352	$	655	$	120,602		$	—		$	7,041		$	24,625
Comprehensive income (loss):
Net loss		(21,885	)		(21,885	)		—			—		—		—			—			—			—
Net change in unrealized holding gain on available-for-sale securities, net of tax of $308		3			—			3			—		—		—			—			—			—
Minimum pension liability, net of tax benefit of $(223)		(224	)		—			(224	)		—		—		—			—			—			—
Foreign currency translation adjustment net of tax benefit of $(3,846)		(5,284	)		—			(5,284	)		—		—		—			—			—			—
Total comprehensive loss		(27,390	)		—			—			—		—		—			—			—			—
Issuance of common stock		27,227			—			—			61				27,166			—			2,179			—
Accretion of redeemable common stock		(1,535	)		—			—			—		—		(1,535	)		—			1,535			—
Stock repurchases		(925	)		—			—			—		—		—			(925	)		(4,698	)		—
Accretion of junior preferred stock		(3,136	)		—			—			—		—		(3,136	)		—			—			3,136
Taxes paid		—			—			—			—		—		—			—			—			(1,344	)
Balance at December 31, 2000	$	94,042			(43,557	)		(5,641	)		413		655		143,097			(925	)		6,057			26,417
Comprehensive income (loss):
Net loss		(16,884	)		(16,884	)		—			—		—		—			—			—			—
Derivative transactions:
Cumulative effect of accounting change, net of tax of $219		328			—			328			—		—		—			—			—			—
Unrealized hedging loss, net of tax benefit of $(1,551)		(2,326	)		—			(2,326	)		—		—		—			—			—			—
Net change in unrealized holding loss on available-for-sale securities, net of tax benefit of $(104)		(157	)		—			(157	)		—		—		—			—			—			—
Minimum pension liability, net of tax benefit of $(5,424)		(8,136	)		—			(8,136	)		—		—		—			—			—			—
Foreign currency translation adjustment, net of tax benefit of $(1,371)		(2,056	)		—			(2,056	)		—		—		—			—			—			—
Total comprehensive loss		(29,231	)		—			—			—		—		—			—			—			—
Accretion of redeemable common stock		(157	)		—			—			—		—		(157	)		—			157			—
Stock repurchases		(142	)		—			—			—		—		—			(142	)		(2,238	)		—
Common stock reclass		710			—			—			2		—		708			—			(710	)		—
Accretion of junior preferred stock		(3,364	)		—			—			—		—		(3,364	)		—			—			3,364
Taxes paid		—			—			—			—		—		—			—			—			(1,442	)
Balance at December 31, 2001	$	61,858		$	(60,441	)	$	(17,988	)	$	415	$	655	$	140,284		$	(1,067	)	$	3,266		$	28,339
Comprehensive income (loss):		—			—			—			—		—		—			—			—			—
Net income		20,821			20,821			—			—		—		—			—			—			—
Unrealized hedging gain, net of tax of $1,308		1,962			—			1,962			—		—		—			—			—			—
Net change in realized holding loss on available-for-sale securities, net of tax benefit of $(963)		(1,444	)		—			(1,444	)		—		—		—			—			—			—
Minimum pension liability, net of tax benefit of $(12,207)		(18,311	)		—			(18,311	)		—		—		—			—			—			—
Foreign currency translation adjustment, net of tax of $4,471		6,706			—			6,706			—		—		—			—			—			—
Total comprehensive income		9,734			—			—			—		—		—			—			—			—
Stock repurchases		(1,181	)		—			—			—		—		—			(1,181	)		(712	)		—
Issuance of common stock		61,494			—			—			137		—		61,357			—			4,821			—
Accretion of junior preferred stock		(3,609	)		—			—			—		—		(3,609	)		—			—			3,609
Taxes paid		—			—			—			—		—		—						—			(1,547	)
Balance at December 31, 2002	$	128,296		$	(39,620	)	$	(29,075	)	$	552	$	655	$	198,032		$	(2,248	)	$	7,375		$	30,401

F-36

(a) Redeemable Junior Preferred Stock

        In connection with the Allied Acquisition, the Company issued 24,500 shares of junior preferred stock, due in 2010, to an affiliate of Exel plc, having an initial liquidation preference of $24,500. The dividend rate on this junior preferred stock is 12.4% compounded quarterly and is cumulative, although the payment of dividends is subject to the discretion of the Board of Directors of the Company and the ability of the Company to pay dividends is subject to various debt agreements. Due to Exel plc being a foreign entity, IRS regulations require withholding taxes to be paid with each quarterly dividend, even if the dividend is notational only. All withholding payments made by the Company reduce the price the Company will ultimately pay to redeem this stock.

        In certain circumstances the junior preferred stock is exchangeable at the option of the Company for subordinated exchange debentures of the Company. The junior preferred stock is required to be redeemed on the eleventh anniversary of its issue date, or upon the occurrence of certain other events. In addition, the Company has a right, subject to the terms of its debt agreements, to redeem the junior preferred stock at any time after the first anniversary of its issue date. The accretion of dividends of $3,136, $3,364 and $3,609 for the years ended December 31, 2000, 2001 and 2002, respectively, was accounted for as a non-cash transaction.

(b) Common Stock Purchase Warrant

        Also in connection with the Allied Acquisition, the Company issued a common stock purchase warrant to an affiliate of Exel plc. The warrant entitles the holder to purchase 2,773,116 shares of common stock of the Company, par value $.01 per share, at an exercise price of $12.62 per share. The term of the warrant is five years and it contains customary anti-dilution protections. In addition, the warrant and any shares issued upon its exercise are subject to certain transfer restrictions. This warrant has been accounted for at fair value on the date of acquisition and was included in the purchase price allocation performed following the Allied Acquisition.

(c) Redeemable Common Stock

        Certain key employees of the Company who hold common stock may require the Company to repurchase all of the shares held upon termination by the Company without cause, or death, disability, or retirement at normal retirement age. This repurchase right terminates upon the consummation of an initial public offering of the Company common stock. In connection with the redemption features described above, the Company has classified outside of permanent equity an amount representing the initial fair value of the redeemable shares. These shares have not been marked to market since the events of redemption are considered remote.

(d) Stock Split

        On June 13, 2002, the Company's Board of Directors approved a ten for one split of the Company's common shares, which was effected by means of a stock dividend of nine shares of common stock for each outstanding share of such stock held as of July 31, 2002. The stock split was effected on July 31, 2002. In connection with the stock split, the Company filed a certificate of amendment to its certificate of incorporation on July 31, 2002 that increased the number of shares of its common stock from 7,608,000 shares of 76,080,000 shares. Periods presented have been restated to show the effect of the stock dividend.

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(16)    Stock Option Plan

        The Company maintains a stock option plan (the "Option Plan") for officers and other key employees which provides for the offer of up to 3,170,000 shares of its common stock and the granting of options to acquire up to 6,340,000 shares of its common stock. The administrator of the Option Plan is SIRVA's Board of Directors. Under the Option Plan, Service Options and, in certain cases, Performance Options, have been granted with each share of stock sold to the officers and other key employees. Service Options are vested in equal annual installments on each of the first five anniversaries of the grant date. Performance Options are vested dependant on achievement of cumulative earnings targets, or if not vested sooner, become vested on the ninth anniversary of the grant date. All options granted expire after ten years from the grant date. The exercise price of both Service and Performance Options equaled the fair market value of common stock at the date of the grant, hence no compensation expense was recognized. Fair market value was determined by management to be equal to the price paid for common stock issued at the grant date.

        Information with respect to the options granted under the Option Plan is as follows:

		# of Shares		Weighted Avg. Exercise Price
Outstanding at December 25, 1999		3,736,416		$	3.71
	Options granted	1,032,152			4.48
	Options cancelled	(1,871,885	)		3.34
Outstanding at December 31, 2000		2,896,683			4.22
	Options granted	481,650			4.48
	Options cancelled	(1,219,879	)		4.31
Outstanding at December 31, 2001		2,158,454			4.24
	Options granted	2,321,309			4.48
	Options cancelled	(308,124	)		4.48
Outstanding at December 31, 2002		4,171,639		$	4.35

        The weighted average remaining contractual life of these options is 8.50 years. At December 31, 2000, 2001 and 2002, the number of options that became exercisable were 302,830, 755,316 and 940,114, respectively.

        During the years ended December 31, 2000, 2001 and 2002, the fair value of common stock was $4.48. Stock options outstanding have exercise prices of $3.15 and $4.48 per share.

        In accordance with the provisions of SFAS 123, as amended by SFAS 148, the Company has elected to continue to account for stock-based compensation under the intrinsic value based method of accounting described by Accounting Principles Board Opinion 25, "Accounting for Stock Issued to Employees" ("APB 25"). Under APB 25, generally no cost is recorded for stock options issued to employees unless the option price is below market at the time options are granted.

        The fair value of each option is estimated on the date of grant, using the Black-Scholes option pricing model with the following weighted average assumptions used: risk-free interest rates of 5.00% to 6.66% for 2000, 4.54% to 4.59% for 2001 and 3.05% to 4.27% for 2002, expected volatility of 0.01%, expected life of 5 years and no dividend payments.

F-38

(17) Commitments and Contingencies

(a) Litigation

        The Company was a defendant in a personal injury suit resulting from a 1996 accident involving one of its agent's drivers. The case was tried in 1998, and the Company was found liable. After appeals, a final judgment of $15,229 was rendered in 2002 and fully paid by the Company and two of its insurers. After certain insurance payments and reimbursements, the Company has paid $7,637, which the Company believes is fully reimbursable by insurance; however, one of the Company's several co-insurers of this case has filed suit, contesting its coverage obligations. If the co-insurer prevails, there is the possibility that some or all of the payment made by the Company will not be reimbursed. The Company has a reserve that it considers appropriate in the circumstances.

        The Company has produced and is producing records in response to grand jury subpoenas issued in connection with an investigation being conducted by attorneys in the Department of Justice Antitrust Division through a grand jury in the Eastern District of Virginia. The Company is cooperating with the investigation and understands that numerous other companies have received similar subpoenas.

        The Company and certain subsidiaries are defendants in numerous lawsuits relating principally to motor carrier operations. In the opinion of management, after consulting with its legal counsel, the amount of the Company's ultimate liability resulting from these matters should not materially affect the Company's financial position, results of operations or liquidity.

(b) Environmental Matters

        The Company has been named as a potentially responsible party ("PRP") in two environmental cleanup proceedings brought under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, or similar state statutes. Based on all known information, the Company believes that the cost to resolve liability at these sites will not be materially or significantly larger than the reserves established, which totaled $35 as of December 31, 2001 and 2002, respectively. These reserves are based upon the Company's allocation of the total estimated cleanup costs as a de minimis contributor, pursuant to agreed orders executed with the Indiana Department of Environmental Management and the U.S. Environmental Protection Agency. The Company has made no provision for expected insurance recovery. The Company could incur significant unanticipated costs, however, if additional contamination is found at these sites, or if it is named as a PRP in other proceedings.

        The Company owns or has owned and leases or has leased facilities at which underground storage tanks are located and operated. Management believes that the Company has taken the appropriate and necessary action with regard to releases that have occurred. Based on its assessment of the facts and circumstances now known and after consulting with its legal counsel, management believes that it has recorded appropriate estimates of liability for those environmental matters of which the Company is aware. Further, management believes it is unlikely that any identified matters, either individually or in aggregate, will have a material effect on the Company's financial position, results of operations or liquidity. As conditions may exist on these properties related to environmental problems that are latent or as yet unknown, there can be no assurance that the Company will not incur liabilities or costs in the future, the amount of which cannot be estimated reliably at this time.

(c) Purchase Commitments

        The Company has entered into certain purchase commitments of $9,844 for software licenses at December 31, 2001 and $6,263 for software licenses and transportation equipment at December 31, 2002.

        On July 1, 2002, the Company entered into a ten year purchase commitment with Covansys Corporation and Affiliated Computer Services, Inc. to provide selected outsourcing services for the Company's domestic information systems infrastructure, including data center operations and telecommunications and certain application

F-39

software development. Covansys Corporation is a related party, as approximately 24% of its outstanding common stock is owned by Fund VI. As of December 31, 2002, the remaining purchase commitment was $176,382. For the year ended December 31, 2002, the Company paid Covansys $2,997.

(18) Financial Instruments

        The Company utilizes interest rate agreements and foreign exchange contracts to manage interest rate and foreign currency exposures. The principal objective of such contracts is to minimize the risks and/or costs associated with financial and international operating activities. The Company does not utilize financial instruments for trading purposes. The counterparties to these contractual arrangements are financial institutions with which the Company also has other financial relationships. The Company is exposed to credit loss in the event of nonperformance by these counterparties. However, the Company does not anticipate nonperformance by the other parties, and no material loss would be expected from their nonperformance. Interest rate swap agreements and foreign exchange instruments with the Company's credit agreement banks are borrower obligations under the credit agreement, hence such agreements and instruments are secured and guaranteed.

(a) Interest Rate Instruments

        The Company enters into interest swap agreements to manage its exposure to changes in interest rates. The swaps involve the exchange of variable interest rate payments for fixed interest rate payments without exchanging the notional principal amounts. The Company records the payments or receipts on the agreements as adjustments to interest expense. Interest rate swap agreements are accounted for as cash flow hedges.

        Derivative gains or losses included in accumulated other comprehensive income are reclassified into earnings at the time when the hedged item affects earnings. During the years ended December 31, 2001 and 2002, $1,900 and $4,449, respectively, were reclassified as interest expense. During the years ended December 31, 2001 and 2002, $82 of expense and $64 of income, respectively, were recognized in earnings for ineffectiveness relating to cash flow hedges. The Company estimates that net derivative losses of $577 included in accumulated other comprehensive income at December 31, 2002 will be reclassified into earnings during the next twelve months. The following is a recap of each agreement as of December 31, 2002:

Notional amount	$40,000	$20,000
Fixed rate paid	4.91%	4.785%
Variable rate received	3 month LIBOR	1 month LIBOR
Expiration date	March 2003	April 2003

        The Company enters into derivative transactions to protect against the risk of adverse interest rate movements on the value of the transactions in our committed loan sales business within the Relocation Services segment. Changes in fair value relating to these derivatives are recognized in current period earnings. No losses resulting from changes in fair value of these derivatives were recognized in earnings for the year ended December 31, 2002.

(b) Foreign Exchange Instruments

        From time-to-time, the Company utilizes foreign currency forward contracts in the regular course of business to manage its exposure against foreign currency fluctuations. The forward contracts establish the exchange rates at which the Company will purchase or sell the contracted amount of U.S. Dollars for specified foreign currencies at a future date. The Company utilizes forward contracts that are short-term in duration (less than one year). The major currency exposures hedged by the Company are the Australian dollar, British pound and Euro. The contract amount of foreign currency forwards was $3,523 and $3,421 at December 31, 2001 and 2002, respectively. Changes in fair

F-40

value relating to these derivatives are recognized in current period earnings. Approximately $432 of gains and $142 of losses resulting from changes in fair value of these derivatives were recognized in earnings for the years ended December 31, 2001 and 2002.

(c) Convertible Bond Instruments

        The Company holds various debt securities with convertible features in the available-for-sale investment portfolio of its insurance operations. The value of the conversion feature is bifurcated from the value of the underlying bond. Changes in fair value are recorded in current period earnings. During the years ended December 31, 2001 and 2002, $9 and $700 of gains, respectively, from increases in the fair market value of these instruments was recorded in earnings.

(19) Earnings Per Share

        A reconciliation of net income (loss) to income available to common stockholders and basic to diluted share amounts is as follows:

	2000			2001			2002
	(in thousands of U.S. dollars except share amounts)
Net income (loss)	$	(21,885	)	$	(16,884	)	$	20,821
Less preferred share dividends		(3,136	)		(3,364	)		(3,609	)
Less accretion of redeemable common stock		(1,535	)		(157	)		—
Net income (loss) available to common stockholders	$	(26,556	)	$	(20,405	)	$	17,212
Basic weighted average common shares outstanding		39,065,685			42,308,361			51,712,625
Assumed conversion of stock options and awards		—			—			119,610
Diluted weighted average common shares outstanding		39,065,685			42,308,361			51,832,236

        Potentially dilutive securities totaling 296,953 shares and 137,664 shares in 2000 and 2001, respectively, have not been included in the determination of diluted net income (loss) per share as their inclusion would be anti-dilutive in those periods.

(20) Operating Segments

        The Company has four reportable segments – 1) Relocation Solutions-North America, 2) Relocation Solutions-Europe and Asia Pacific, together forming Global Relocation Solutions, 3) Network Services, and 4) Transportation Solutions. Intersegment transactions, principally relating to international operations, are recorded at market rates as determined by management. The consolidation process results in the appropriate elimination of intercompany transactions, with operating revenues reflected in the segment responsible for billing the end customer.

Global Relocation Solutions

        The Company's global relocation solutions business provides a combination of relocation services, global mobility services and moving and storage services that are tailored by geographic region to the specific customer

F-41

needs. Global Relocation Solutions is comprised of the Relocation Solutions-North America and the Relocation Solutions-Europe and Asia Pacific reportable segments. This business provides the following services:

•

Relocation Services: Relocation services include realtor services for home sales and purchases, tax and expense management and closing and destination services.



•

Global Mobility Services: These services include assignment management programs, destination services to identify housing, schools, and other critical client needs, as well as expatriate tax and expense management services.



•

Moving and Storage Services:



•

Household Goods: The Company provides worldwide household goods moving and storage services, including sales, packing, loading, transportation, delivery and warehousing. In the U.S. and Canada, moving and storage services are provided through a network of exclusive agents. Outside of the U.S. and Canada, the Company provides these services through a network of company-owned branches throughout the U.K., Europe and the Asia Pacific region.



•

Commercial Customers: The Company provides a broad portfolio of services to commercial customers, including office and industrial relocations and records management.



•

Transportation of High-Value Products: The Company provides customized solutions to facilitate the movement of high-value products that require specialized transport and handling, such as electronics, telecommunications, medical equipment and fine art.

Network Services

        The network services business offers insurance programs, such as auto liability, occupational accident, physical damage, cargo and warehouse insurance coverage, to a network of agents, owner operators and drivers as well as independent third parties. The Company also offers fleet services, or a broad array of vehicle and supply purchase programs, as well as vehicle repair services.

Transportation Solutions

        The Company provides logistic and transportation solutions to customers that require transportation management capabilities, inventory visibility at the serialized level, and in-transit merge delivery solutions that are coordinated at the item level to deliver commercial goods that require specialized handling in a timely manner with the appropriate equipment.

F-42

        The tables below represent information about operating revenues, depreciation and amortization, income (loss) from operations and total assets by segment used by the chief operating decision-maker of the Company as of and for the years ended December 31, 2000, 2001 and 2002:

December 31, 2000:	Operating Revenues		Depreciation and Amortization(1)		Income (Loss) from Operations
Relocation Solutions – North America	$	1,791,803	$	29,053	$	8,079
Relocation Solutions – Europe & Asia Pacific		372,745		21,834		23,730
Global Relocation Solutions		2,164,548		50,887		31,809
Network Services		75,812		704		17,365
Transportation Solutions		138,334		2,289		325
Corporate		—		—		(77	)
Consolidated Totals	$	2,378,694	$	53,880	$	49,422

December 31, 2001:	Operating Revenues		Depreciation and Amortization(1)		Income (Loss) from Operations			Total Assets(2)
Relocation Solutions – North America	$	1,652,135	$	25,871	$	15,142		$	589,607
Relocation Solutions – Europe & Asia Pacific		387,081		20,104		25,976			313,164
Global Relocation Solutions		2,039,216		45,975		41,118			902,771
Network Services		84,210		659		18,478			148,780
Transportation Solutions		125,877		2,108		(6,294	)		22,438
Corporate		—		—		(785	)		—
Consolidated Totals	$	2,249,303	$	48,742	$	52,517		$	1,073,989

December 31, 2002:	Operating Revenues		Depreciation and Amortization(1)		Income (Loss) from Operations			Total Assets(2)
Relocation Solutions – North America	$	1,544,438	$	23,017	$	40,993		$	745,025
Relocation Solutions – Europe & Asia Pacific		407,972		16,941		24,840			372,588
Global Relocation Solutions		1,952,410		39,958		65,833			1,117,613
Network Services		125,042		3,118		26,452			221,444
Transportation Solutions		108,194		1,173		3,274			18,478
Corporate		—		—		(1,298	)		—
Consolidated Totals	$	2,185,646	$	44,249	$	94,261		$	1,357,535

(1)

Depreciation and amortization are comprised of depreciation, goodwill amortization (prior to January 1, 2002), intangibles amortization in 2002 and deferred agent contract amortization.

(2)

Total assets by segment are specific assets such as trade receivables and property and equipment. Assets also included allocated assets such as computer hardware and software, contracts receivable associated with equipment sales, deferred taxes, goodwill and intangible assets.

F-43

        Specified items related to segment assets:

	Year Ended December 31, 2000 Capital Expenditures		Year Ended December 31, 2001 Capital Expenditures		Year Ended December 31, 2002 Capital Expenditures
Relocation Solutions — North America	$	38,134	$	27,195	$	13,429
Relocation Solutions — Europe & Asia Pacific		16,943		20,840		18,335
Global Relocation Solutions		55,077		48,035		31,764
Network Services		7		44		1,648
Transportation Solutions		293		269		51
Corporate		—		—		—
Consolidated Totals	$	55,377	$	48,348	$	33,463

        Operating revenues and long-lived asset information by geographic area as of and for the years ended December 31, 2002, 2001 and 2000:

	2000		2001				2002
	Operating Revenues		Operating Revenues		Long-lived Assets		Operating Revenues		Long-lived Assets
United States	$	1,941,399	$	1,799,200	$	305,944	$	1,723,692	$	460,003
Foreign		437,295		450,103		272,652		461,954		270,578
Total	$	2,378,694	$	2,249,303	$	578,596	$	2,185,646	$	730,581

        Foreign revenue is based on the country in which the sales originated, principally in the United Kingdom, Continental Europe and Australia. Long-lived assets are comprised of property and equipment, net and goodwill and intangible assets, net.

F-44

(21)    Restructuring and Unusual Items

        The following table provides details of restructuring for the year ended December 31, 2000:

	Restructuring Accruals as of December 25, 1999		Allied Acquisition Adjustment			Restructuring Charge		Other Adjustments			Payments			Restructuring Accruals as of December 31, 2000
Fast Forward Program
Severance cost	$	2,365		—		$	1,235	$	(265	)	$	(2,917	)	$	418
Outplacement services and other		422		—			—		105			(270	)		257
Total restructuring cost		2,787		—			1,235		(160	)		(3,187	)		675
Allied Acquisition
Severance cost		2,916		(1,255	)		—		—			(1,326	)		335
Other		860		(300	)		—		—			(495	)		65
Total restructuring cost		3,776		(1,555	)		—		—			(1,821	)		400
Branch System
Severance cost		—		—			2,700		—			(2,565	)		135
Total restructuring cost		—		—			2,700		—			(2,565	)		135
Business Needs Staffing Adjustment
Severance cost		—		—			1,084		—			(333	)		751
Total restructuring cost		—		—			1,084		—			(333	)		751
Total	$	6,563	$	(1,555	)	$	5,019	$	(160	)	$	(7,906	)	$	1,961

F-45

        The following table provides details of restructuring for the year ended December 31, 2001:

	Restructuring Accruals as of December 31, 2000		Restructuring Charge		Other Adjustments			Asset Impairment			Payments			Restructuring Accruals as of December 31, 2001
Fast Forward Program
Severance cost	$	418	$	—	$	292		$	—		$	(710	)	$	—
Outplacement services and other		257		—		(247	)		—			(10	)		—
Total restructuring cost		675		—		45			—			(720	)		—
Allied Acquisition
Severance cost		335		—		(170	)		—			(165	)		—
Other		65		—		112			—			(177	)		—
Total restructuring cost		400		—		(58	)		—			(342	)		—
Branch System
Severance cost		135		595		—			—			(730	)		—
Total restructuring cost		135		595		—			—			(730	)		—
Business Needs Staffing Adjustment
Severance cost		751		429		15			—			(1,195	)		—
Total restructuring cost		751		429		15			—			(1,195	)		—
Transportation Solutions Parts Centers
Severance cost		—		969		(325	)		—			(604	)		40
Building leases		—		2,167		353			—			(403	)		2,117
Asset impairment		—		772		(79	)		(576	)		(37	)		80
Total restructuring cost		—		3,908		(51	)		(576	)		(1,044	)		2,237
Total	$	1,961	$	4,932	$	(49	)	$	(576	)	$	(4,031	)	$	2,237

        The following table provides details of restructuring for the year ended December 31, 2002:

	Restructuring Accrual as of December 31, 2001		Restructuring Credit			Payments			Restructuring Accrual as of December 31, 2002
Transportation Solutions Parts Centers
Severance cost	$	40	$	—		$	(40	)	$	—
Building leases and other		2,197		(942	)		(741	)		514
Total	$	2,237	$	(942	)	$	(781	)	$	514

(a)Fast Forward Program

        In January 1999, with the help of outside consultants, the Company initiated the Fast Forward Program, which was a detailed evaluation of its existing cost structure. The program was comprised of a number of initiatives, primarily relating to employee redundancy. The charges included estimated severance costs for 237 employees across all operating divisions of the Company, outplacement services and other costs. None of these charges related

F-46

to the Allied Acquisition. A total of 188 employees were terminated. The remaining employees transferred to other divisions or left the Company voluntarily. During 2000, the Fast Forward Program was completed, with remaining severance costs paid in 2001.

(b)Allied Acquisition

        Included in the acquisition purchase price allocation were restructuring charges related to the Allied Acquisition, which reflected certain severance and relocation costs the Company incurred to effect a worldwide integration plan for Allied's operations. A total of 66 employees were terminated and 55 were relocated. In 2000, based on an evaluation of the remaining amount needed, a reduction of $1,555 was made to the restructuring accrual, which was offset by an adjustment to goodwill. During 2000, the program was completed with remaining severance costs paid in 2001.

(c)Branch System

        In 2000, the Company's Relocation Solutions — Europe and Asia Pacific segment initiated programs in its United Kingdom operations in an effort to restructure its branch system and to eliminate management redundancy within its Pickfords Vanguard unit, reducing headcount by 93 employees. Charges were recorded as branch locations were identified for closure. The identification process continued through 2001 and headcount was reduced by an additional 16 employees. The programs were completed in 2001.

(d)Business Needs Staffing Adjustment

        In November 2000, due to business needs as determined by management, the Company established a restructuring reserve of $1,084 whereby headcount was reduced by 50 employees. The charges included estimated severance costs across all operating divisions of the Company. Severance costs were paid out and the program was completed in 2001.

(e)Transportation Solutions Parts Centers

        In June 2001, the Company's Transportation Solutions segment established a program to exit the Parts Center business. The program charges included severance and employee benefit costs for 293 employees, lease and asset impairment costs to shut down and exit the Parts Center business by the end of 2001. Due to lease terms and severance agreements, certain payments will continue through September 2005. During the year ended December 31, 2002, the restructuring accrual was reduced by $942 when the Company was able to sublease certain Parts Centers facilities earlier than originally estimated. As of December 31, 2002, 293 employees had been terminated.

(f)Headquarters Move

        In December 2002, the Company incurred expenses of $4,658 associated with the move of its corporate headquarters building. The expenses were comprised of $3,625 of remaining lease obligation costs, utilities and taxes associated with the former headquarters building, and were recorded upon exiting the facility. In addition, $1,033 of costs primarily relating to moving expenses to relocate to the new facility were expensed as incurred.

Unusual Items

        The asset impairment charge of $7,092 for the year ended December 31, 2002 was due to a reduction in the number of software modules implemented by the high-value products moving business within Relocation Solutions — North America and Transportation Solutions, as a result of a change in business strategy. Curtailment and other gains for the year ended December 31, 2002 were comprised of $7,370 of pension and retiree medical

F-47

curtailment gain as the pension plan was frozen and retiree medical benefits were reduced (See Note 12) and $3,007 of gain from the sale of the Company's U.K. industrial moving business. The net book value of the assets sold was $1,322 and 2002 operating losses for the disposed entity were $2,573.

(22)    Related Party

        Fund V and Fund VI, which are private investment funds managed by CD&R, own approximately 56.6% and 23.5% of the Company's outstanding common stock, respectively. Of the eight members of the Company's Board of Directors, two are principals of Clayton, Dubilier & Rice, Inc.

        The Company, NAVL and CD&R are parties to a consulting agreement pursuant to which CD&R is paid a management fee for financial advisory and management consulting services. For the years ended December 31, 2000, 2001 and 2002, such fees were $400, $1,375 and $1,375, respectively.

        NAVL has guaranteed loans made by a third-party lender in an aggregate principal amount of $21 and $810 as of December 31, 2001 and 2002, respectively, to various members of management, including certain of our executive officers, in connection with their investment in SIRVA. NAVL would become liable for such amounts in the event that a member of management would fail to repay the principal and interest when due. These loans mature in May 2004 and bear interest at the prime rate plus 1.0%. The loans to our executive officers were made prior to passage of the Sarbanes-Oxley Act. Subsequent to its passage, a policy was adopted that prohibited the Company or any of its subsidiaries from making loans to or guaranteeing loans of executive officers.

(23)    Supplemental Information

        The following summarized consolidating balance sheets, statements of operations and statements of cash flows were prepared to segregate such financial statements between those entities that have guaranteed the senior subordinated notes issued by NAVL, a wholly owned subsidiary of the Company in connection with the Allied Acquisition ("Guarantor" entities) and those entities that did not guarantee such debt ("Non-Guarantor" entities). See Note 2 for additional information on the Allied Acquisition. The Company is not party to the senior subordinated notes, and provides no guarantees thereto.

F-48

        Consolidated condensed balance sheet data as of December 31, 2001 and 2002 is summarized as follows:

		December 31, 2001
		Parent		Issuer(1)		Total Guarantors(2)		Non- Guarantors		Eliminations			Consolidated
Current assets:
	Accounts and notes receivable, net	$	—	$	118,345	$	92,560	$	63,795	$	(7,588	)	$	267,112
	Other current assets		592		43,935		21,701		44,619		(294	)		110,553
Total current assets			592		162,280		114,261		108,414		(7,882	)		377,665
Property and equipment, net			—		72,523		11,687		81,157		—			165,367
Goodwill and intangible assets, net			—		409,993		3,236		—		—			413,229
Other assets			141,213		160,434		151,257		441,193		(776,369	)		117,728
Total assets		$	141,805	$	805,230	$	280,441	$	630,764	$	(784,251	)	$	1,073,989
Current liabilities		$	145	$	152,406	$	138,820	$	122,528	$	(8,454	)	$	405,445
Long-term debt and capital lease obligations			48,197		448,225		226		8,325		—			504,973
Other liabilities			—		82,809		25,199		—		(37,900	)		70,108
Total liabilities			48,342		683,440		164,245		130,853		(46,354	)		980,526
Redeemable common stock			3,266		—		—		—		—			3,266
Redeemable junior preferred stock			28,339		—		—		—		—			28,339
Stockholder's equity			61,858		121,790		116,196		499,911		(737,897	)		61,858
Total liabilities and stockholder's equity		$	141,805	$	805,230	$	280,441	$	630,764	$	(784,251	)	$	1,073,989

F-49

		December 31, 2002
		Parent		Issuer(1)		Total Guarantors(2)		Non- Guarantors		Eliminations			Consolidated
Current assets:
	Accounts and notes receivable, net	$	—	$	100,220	$	140,764	$	81,770	$	(13,189	)	$	309,565
	Other current assets		2,447		35,993		51,739		114,278		(1,251	)		203,206
Total current assets			2,447		136,213		192,503		196,048		(14,440	)		512,771
Property and equipment, net			—		54,187		22,163		94,907		—			171,257
Goodwill and intangible assets, net			157		537,836		3,235		15,955		2,141			559,324
Other assets			220,046		289,548		195,438		332,344		(923,193	)		114,183
Total assets		$	222,650	$	1,017,784	$	413,339	$	639,254	$	(935,492	)	$	1,357,535
Current liabilities		$	—	$	92,696	$	210,489	$	230,641	$	(11,168	)	$	522,658
Long-term debt and capital lease obligations			56,578		505,846		221		9,187		—			571,832
Other liabilities			—		198,294		25,307		16,252		(142,880	)		96,973
Total liabilities			56,578		796,836		236,017		256,080		(154,048	)		1,191,463
Redeemable common stock			7,375		—		—		—		—			7,375
Redeemable junior preferred stock			30,401		—		—		—		—			30,401
Stockholder's equity			128,296		220,948		177,322		383,174		(781,444	)		128,296
Total liabilities and stockholder's equity		$	222,650	$	1,017,784	$	413,339	$	639,254	$	(935,492	)	$	1,357,535

F-50

        Consolidated condensed statements of operations data for the years ended December 31, 2000, 2001 and 2002 are summarized as follows:

	Year ended December 31, 2000
	Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Eliminations			Consolidated
Operating revenues	$	—		$	919,362		$	934,549		$	568,018		$	(43,235	)	$	2,378,694
Total operating expenses		422			932,364			914,544			526,333			(44,391	)		2,329,272
Income (loss) from operations		(422	)		(13,002	)		20,005			41,685			1,156			49,422
Non-operating (income) expense		—			(3,257	)		200			2,739			—			(318	)
Interest expense (income)		6,157			66,799			1,199			(748	)		—			73,407
Dividend income		—			(777	)		—			—			777			—
Income (loss) before income taxes		(6,579	)		(75,767	)		18,606			39,694			379			(23,667	)
Provision (benefit) for income taxes		(1,773	)		(23,268	)		5,484			17,775			—			(1,782	)
Equity (income) loss		17,079			(35,420	)		(8,041	)		—			26,382			—
Net income (loss)	$	(21,885	)	$	(17,079	)	$	21,163		$	21,919		$	(26,003	)	$	(21,885	)

	Year ended December 31, 2001
	Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Eliminations			Consolidated
Operating revenues	$	—		$	824,687		$	867,856		$	619,686		$	(62,926	)	$	2,249,303
Total operating expenses		785			838,363			850,299			570,574			(63,235	)		2,196,786
Income (loss) from operations		(785	)		(13,676	)		17,557			49,112			309			52,517
Non-operating (income) expense		—			(3,147	)		43			3,155			—			51
Interest expense (income)		7,153			58,369			3,776			(145	)		—			69,153
Dividend income		—			(75,167	)		(9,887	)		(11,039	)		96,093			—
Income (loss) before income taxes		(7,938	)		6,269			23,625			57,141			(95,784	)		(16,687	)
Provision (benefit) for income taxes		(2,001	)		(19,641	)		5,721			15,790			—			(131	)
Income (loss) before accounting change.		(5,937	)		25,910			17,904			41,351			(95,784	)		(16,556	)
Cumulative effect of accounting change, net of tax		—			—			—			328			—			328
Equity (income) loss		10,947			36,857			1,445			—			(49,249	)		—
Net income (loss)	$	(16,884	)	$	(10,947	)	$	16,459		$	41,023		$	(46,535	)	$	(16,884	)

F-51

	Year ended December 31, 2002
	Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Eliminations			Consolidated
Operating revenues	$	—		$	741,591		$	852,711		$	641,598		$	(50,254	)	$	2,185,646
Total operating expenses		1,298			728,103			818,463			593,775			(50,254	)		2,091,385
Income from operations		(1,298	)		13,488			34,248			47,823			—			94,261
Non-operating (income) expense		—			(3,270	)		137			3,773			—			640
Interest expense (income)		8,673			47,888			3,911			697			—			61,169
Dividend income		—			—			(10,500	)		(6,407	)		16,907			—
Income (loss) before income tax		(9,971	)		(31,130	)		40,700			49,760			(16,907	)		32,452
Provision (benefit) for income taxes		(3,034	)		(15,372	)		11,552			18,485			—			11,631
Equity (income) loss		(27,758	)		(42,878	)		(2,113	)		—			72,749			—
Net income (loss)	$	20,821		$	27,120		$	31,261		$	31,275		$	(89,656	)	$	20,821

F-52

        Consolidated condensed statements of cash flows data for the years ended December 31, 2000, 2001 and 2002 are summarized as follows:

		Year ended December 31, 2000
		Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Consolidated
Net cash provided by (used in) operating activities		$	(22,417	)	$	27,157		$	(5,676	)	$	31,332		$	30,396
Cash flows from investing activities:
Additions of property and equipment			—			(30,014	)		(3,952	)		(21,411	)		(55,377	)
	Proceeds from sale of property		—			15,086			—			506			15,592
	Purchases of investments		—			(800	)		—			(55,141	)		(55,941	)
	Proceeds from maturity or sale of investments		—			—			—			49,353			49,353
	Acquisitions, net of cash acquired		—			(4,200	)		—			(1,580	)		(5,780	)
	Other investing activities		—			(1,120	)		(1,113	)		—			(2,233	)
Net cash used by investing activities			—			(21,048	)		(5,065	)		(28,273	)		(54,386	)
Cash flows from financing activities:
	Borrowings from revolving credit facility, net.		—			18,330			—			184			18,514
	Repayments on long-term debt and capital lease obligations		—			(11,217	)		—			—			(11,217	)
	Proceeds from issuance of common stock		29,406			—			—			—			29,406
	Other financing activities		(6,967	)		3,399			19			(23	)		(3,572	)
	Sale of equipment note receivable		—			—			11,121			—			11,121
Net cash provided by financing activities			22,439			10,512			11,140			161			44,252
Effect of translation adjustments on cash			—			—			—			(1,886	)		(1,886	)
Net increase in cash and cash equivalents			22			16,621			399			1,334			18,376
Cash and cash equivalents at beginning of period			—			895			(3,368	)		27,628			25,155
Cash and cash equivalents at end of period		$	22		$	17,516		$	(2,969	)	$	28,962		$	43,531

F-53

		Year ended December 31, 2001
		Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Consolidated
Net cash provided by (used in) operating activities		$	3,800		$	82,473		$	(673	)	$	29,523		$	115,123
Cash flows from investing activities:
Additions of property and equipment			—			(24,431	)		(2,970	)		(20,947	)		(48,348	)
	Proceeds from sale of property		—			1,810			553			1,114			3,477
	Purchases of investments		—			—			—			(87,305	)		(87,305	)
	Proceeds from maturity or sale of investments		—			—			—			81,905			81,905
	Acquisitions, net of cash acquired		—			(17,357	)		(4,000	)		—			(21,357	)
	Other investing activities		—			(1,371	)		—			—			(1,371	)
Net cash used by investing activities			—			(41,349	)		(6,417	)		(25,233	)		(72,999	)
Cash flows from financing activities:
	Borrowings from revolving credit facility, net.		—			(36,508	)		—			(1,435	)		(37,943	)
	Repayments on long-term debt and capital lease obligations		—			(13,992	)		(81	)		(242	)		(14,315	)
	Borrowings of long-term debt		—			672			—			—			672
	Other financing activities		(3,822	)		(2,815	)		7,838			(9,348	)		(8,147	)
	Sale of equipment note receivable		—			—			6,317			—			6,317
Net cash provided by (used for) financing activities			(3,822	)		(52,643	)		14,074			(11,025	)		(53,416	)
Effect of translation adjustments on cash			—			—			—			(120	)		(120	)
Net increase (decrease) in cash and cash equivalents			(22	)		(11,519	)		6,984			(6,855	)		(11,412	)
Cash and cash equivalents at beginning of period			22			17,516			(2,969	)		28,962			43,531
Cash and cash equivalents at end of period		$	—		$	5,997		$	4,015		$	22,107		$	32,119

F-54

		Year ended December 31, 2002
		Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Consolidated
Net cash provided by (used for) operating activities		$	(62,718	)	$	34,696		$	17,763		$	77,491		$	67,232
Cash flows from investing activities:
	Additions of property and equipment		—			(4,776	)		(7,771	)		(20,916	)		(33,463	)
	Proceeds from sale of property		—			966			1,337			2,979			5,282
	Purchases of investments		—			—			—			(66,999	)		(66,999	)
	Proceeds from maturity or sale of investments		—			—			—			62,068			62,068
	Acquisitions, net of cash acquired		(157	)		(80,476	)		—			(21,992	)		(102,625	)
	Other investing activities		—			(670	)		(1,092	)		—			(1,762	)
Net cash used by investing activities			(157	)		(84,956	)		(7,526	)		(44,860	)		(137,499	)
Cash flows from financing activities:
	Borrowings on revolving credit facility, net.		—			(19,000	)		—			31,823			12,823
	Change in balance of outstanding checks		—			(6,274	)		(4,304	)		235			(10,343	)
	Repayments on long-term debt and capital lease obligations		—			(30,317	)		(9	)		(1,551	)		(31,877	)
	Borrowings on long-term debt		—			50,403			—			—			50,403
	Proceeds from issuance of common stock		66,315			56,500			—			(56,500	)		66,315
	Debt issuance costs		—			(2,769	)		—			(140	)		(2,909	)
	Other financing activities		(3,440	)		(6,274	)		(4,304	)		235			(13,783	)
	Sale of equipment notes receivable		—			—			1,164			—			1,164
Net cash provided by (used for) financing activities			62,875			48,543			(3,149	)		(26,133	)		82,136
Effect of translation adjustments on cash			—			—			—			1,492			1,492
Net increase in cash and cash equivalents			—			(1,717	)		7,088			7,990			13,361
Cash and cash equivalents at beginning of period			—			5,997			4,015			22,107			32,119
Cash and cash equivalents at end of period		$	—		$	4,280		$	11,103		$	30,097		$	45,480

(1)

Issuer includes the accounts of North American Van Lines, Inc., a Delaware corporation and the issuer of the debt.

F-55

(2)

Total Guarantors include the accounts of the following direct or indirect subsidiaries of North American Van Lines, Inc. or its subsidiary, Allied Van Lines, Inc.:

Name	Incorporated
A Relocation Solutions Management Company	Delaware
Allied Freight Forwarding, Inc.	Delaware
Allied International N.A., Inc.	Delaware
Allied Transportation Forwarding, Inc.	Delaware
Allied Van Lines, Inc.	Delaware
Allied Van Lines Terminal Company	Delaware
Corporate Transfer Service, Inc.	Minnesota
CRS Acquisition Corp	Delaware
Federal Traffic Service, Inc.	Indiana
Fleet Insurance Management, Inc.	Indiana
FrontRunner Worldwide, Inc.	Delaware
Global Van Lines, Inc.	Indiana
Great Falls North American, Inc.	Montana
Meridian Mobility Resources, Inc.	Delaware
NACAL, Inc.	California
National Association of Independent Truckers, LLC	Delaware
North American Logistics, Ltd.	Indiana
North American Van Lines of Texas, Inc.	Texas
ProSource Properties, Ltd.	Ohio
Relocation Management Systems, Inc.	Delaware
SIRVA Freight Forwarding, Inc. (formerly known as NAVTRANS International Freight Forwarding, Inc.)	Indiana
SIRVA Global Relocation, Inc.	Delaware
SIRVA Relocation LLC	Delaware
SIRVA Title Agency, Inc. (formerly known as CRS Title Agency, Inc.)	Ohio
StorEverything, Inc.	Delaware
U.S. Relocation Services, Inc.	Delaware
Vanguard Insurance Agency, Inc.	Illinois

        Each Guarantor (other than U.S. Relocation Services, Inc.) is a wholly owned subsidiary of North American Van Lines, Inc. or its subsidiary, Allied Van Lines, Inc. and jointly and severally, irrevocably and fully and unconditionally guarantees the punctual payment of such debt issued under North American Van Lines, Inc.'s senior credit facility and senior subordinated notes.

(24)    Subsequent Event (Unaudited)

        On November 7, 2003, the Company's Board of Directors approved a 3.17 for one stock split of the Company's common stock, which will be effected by means of a reclassification. The stock split will become effective prior to the consummation of the Company's initial public offering. In connection with the stock split, the Company filed a certificate of amendment to its certificate of incorporation on November 10, 2003 that will increase the number of shares of its common stock from 24,000,000 to 500,000,000. Periods presented have been restated to show the effect of the stock split.

F-56

SIRVA, INC.
Condensed Consolidated Balance Sheets
At December 31, 2002 and September 30, 2003

(Dollars in thousands except share data)
(Unaudited)

	December 31, 2002			September 30, 2003
Assets
Current assets:
Cash and cash equivalents	$	45,480		$	60,719
Accounts and notes receivable, net of allowance for doubtful accounts of $25,059 and $23,589, respectively		309,565			419,851
Mortgages held for resale		42,798			66,281
Relocation properties held for resale, net of allowance for loss on sale of $1,772 and $2,175, respectively		39,115			79,103
Other current assets		38,172			48,991
Deferred and recoverable income taxes		37,641			37,988
Total current assets		512,771			712,933
Property and equipment, net		171,257			173,792
Goodwill, net		331,147			350,168
Intangible assets, net		228,177			227,342
Other assets		114,183			119,429
Total long-term assets		844,764			870,731
Total assets	$	1,357,535		$	1,583,664
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	27,261		$	26,996
Mortgage warehouse facility		41,893			63,242
Relocation financing facilities		15,432			37,657
Other short-term debt		15,074			2,614
Accounts payable		83,962			114,305
Relocation properties related payables		38,630			56,473
Purchased transportation expense		63,691			101,559
Other current liabilities		231,334			242,677
Accrued income taxes		5,381			7,790
Total current liabilities		522,658			653,313
Long-term debt and capital lease obligations		571,832			621,951
Redeemable junior preferred obligation		—			32,046
Other liabilities		68,036			63,579
Deferred income taxes		28,937			42,461
Total long-term liabilities		668,805			760,037
Total liabilities		1,191,463			1,413,350
Commitments and contingencies
Redeemable shares of common stock, $.01 par value, 3,702,249 shares issued and 1,870,053 shares outstanding at December 31, 2002 and 4,170,018 shares issued and 2,093,662 shares outstanding at September 30, 2003		7,375			11,528
Redeemable junior preferred stock, $.01 par value, 24,500 shares authorized, issued and outstanding at December 31, 2002 and September 30, 2003, with a liquidation preference of $1,000 per share		30,401			—
Stockholders' equity:
Common stock, $.01 par value, 24,000,000 shares authorized with 55,232,644 issued and 54,730,865 shares outstanding at December 31, 2002 and 55,334,994 issued and 54,833,191 shares outstanding at September 30, 2003		552			553
Additional paid-in-capital		198,032			196,740
Common stock purchase warrant		655			655
Accumulated other comprehensive loss		(29,075	)		(28,204	)
Accumulated deficit		(39,620	)		(8,710	)
Total paid-in-capital and accumulated deficit		130,544			161,034
Less cost of treasury stock, 501,779 and 501,779 shares at December 31, 2002 and September 30, 2003, respectively		(2,248	)		(2,248	)
Total stockholders' equity		128,296			158,786
Total liabilities and stockholders' equity	$	1,357,535		$	1,583,664

See accompanying notes to condensed consolidated financial statements.

F-57

SIRVA, INC.
Condensed Consolidated Income Statements
For the nine months ended September 30, 2002 and 2003

(Dollars in thousands except share and per share data)
(Unaudited)

		Nine Months Ended
		September 30, 2002			September 30, 2003
Operating revenues		$	1,645,584		$	1,785,188
	Purchased transportation expense		990,554			1,002,110
	Other direct expense		343,540			429,831
Total direct expenses			1,334,094			1,431,941
Gross margin			311,490			353,247
	General and administrative expenses		236,894			253,190
	Intangibles amortization		2,300			4,193
	Equity based compensation expense		—			2,970
	Restructuring		(842	)		—
Income from operations			73,138			92,894
	Non-operating (expense) income		(316	)		191
	Interest expense		44,910			44,968
	Interest expense on redeemable preferred obligation		—			976
Income before income taxes			27,912			47,141
	Provision for income taxes		10,909			16,231
Net income		$	17,003		$	30,910
Net income per share – basic		$	0.29		$	0.51
Net income per share – diluted		$	0.28		$	0.48
Average number of common shares outstanding – basic			50,182,133			56,670,610
Average number of common shares outstanding – diluted			50,299,401			59,200,118

See accompanying notes to condensed consolidated financial statements.

F-58

SIRVA, INC.
Condensed Consolidated Statements of Cash Flows
For the nine months ended September 30, 2002 and 2003

(Dollars in thousands)
(Unaudited)

		Nine Months Ended
		September 30, 2002			September 30, 2003
Cash flows from operating activities:
	Net income	$	17,003		$	30,910
Adjustments to reconcile net income to net cash provided by operating activities:
	Depreciation		25,937			27,779
	Amortization		4,987			7,303
	Amortization of debt issuance costs		2,289			2,533
	Change in provision for losses on accounts and notes receivable		4,836			2,935
	Deferred income taxes		9,475			13,786
	(Gain) on sale of assets, net		(414	)		(1,128	)
Change in operating assets and liabilities, net of effect of acquisitions:
	Accounts and notes receivable		(75,721	)		(91,529	)
	Mortgages held for resale		(22,246	)		(23,483	)
	Relocation properties held for resale, net		(5,579	)		(32,590	)
	Other current assets		45			4,897
	Federal income tax recoverable		2,737			(4	)
	Accounts payable		26,601			24,485
	Other current liabilities		18,472			50,025
	Accrued income taxes		(1,887	)		1,894
	Other long-term assets and liabilities		19,101			4,617
Net cash provided by operating activities			25,636			22,430
Cash flows from investing activities:
	Additions of property and equipment		(24,951	)		(17,399	)
	Proceeds from sale of property and equipment		2,336			4,696
	Purchases of investments		(43,522	)		(82,614	)
	Proceeds from sale or maturity of investments		45,627			61,136
	Acquisitions, net of cash acquired		(102,510	)		(29,423	)
	Other investing activities		(1,248	)		(2,195	)
Net cash used for investing activities			(124,268	)		(65,799	)
Cash flows from financing activities:
	Borrowings on revolving credit facility and short-term debt		254,816			394,169
	Repayments on revolving credit facility and short-term debt		(235,409	)		(351,645	)
	Borrowings on mortgage warehouse facility		320,322			650,960
	Repayments on mortgage warehouse facility		(298,497	)		(629,611	)
	Borrowings on relocation financing facilities		1,053			54,434
	Repayments on relocation financing facilities		(1,349	)		(33,140	)
	Borrowings of long-term debt, excluding revolving credit facility		50,403			449
	Repayments on long-term debt and capital lease obligations		(27,799	)		(21,596	)
	Proceeds from issuance of common stock		61,489			3,185
	Other financing activities		(12,593	)		(9,854	)
Net cash provided by financing activities			112,436			57,351
	Effect of translation adjustments on cash		987			1,257
Net increase in cash and cash equivalents			14,791			15,239
Cash and cash equivalents at beginning of period			32,119			45,480
Cash and cash equivalents at end of period		$	46,910		$	60,719

See accompanying notes to condensed consolidated financial statements.

F-59

SIRVA, INC.
Notes to Condensed Consolidated Financial Statements

(Dollars in thousands except share and per share data)
(Unaudited)

(1)    Basis of Presentation

        This report covers SIRVA, Inc. (the "Company") and its wholly owned subsidiaries North American Van Lines, Inc. ("NAVL"), CMS Holding, LLC and RS Acquisition Holding, LLC.

        The accompanying unaudited condensed consolidated financial statements should be read together with the Company's audited consolidated financial statements for the year ended December 31, 2002. Certain information and footnote disclosures normally included in the aforementioned financial statements prepared in accordance with generally accepted accounting principles are condensed or omitted. Management of the Company believes the interim financial statements include all adjustments, including normal recurring adjustments, necessary for a fair presentation of the financial condition and results of operations for the interim periods presented.

        In accordance with the provisions of SFAS 123, as amended SFAS 148, the Company has elected to continue to account for stock-based compensation under the intrinsic value based method of accounting described by Accounting Principles Board Opinion 25, "Accounting for Stock Issued to Employees" ("APB 25"). Under APB 25, generally no cost is recorded for stock options issued to employees unless the option price is below market at the time options are granted.

        Had the Company elected to apply the provisions of SFAS 123 and SFAS 148 regarding recognition of compensation expense to the extent of the calculated fair value of stock options granted, net income would have changed as follows:

	Nine Months Ended
	September 30, 2002			September 30, 2003
Net income as reported	$	17,003		$	30,910
Equity based compensation expense included in net income, net of tax		—			490
Pro forma compensation cost under fair value method, net of tax		(243	)		(698	)
Adjusted net income	$	16,760		$	30,702
Basic net income per ordinary share, as reported	$	0.29		$	0.51
Basic net income per ordinary share, proforma	$	0.28		$	0.50
Diluted net income per ordinary share, as reported	$	0.28		$	0.48
Diluted net income per ordinary share, proforma	$	0.28		$	0.48

        In January 2003, the FASB issued Interpretation No. 46, "Consolidation of Variable Interest Entities" ("FIN 46"). FIN 46 addresses consolidation by business enterprises of variable interest entities. On October 8, 2003, the FASB deferred the effective date of FIN 46 for variable interest entities created before February 1, 2003 until the first reporting period after December 15, 2003. As of September 30, 2003, the Company had no variable interest entities.

        In April 2003, the FASB issued Statement No. 149, "Amendment of Statement 133 on Derivative Instruments and Hedging Activities" ("SFAS 149"). SFAS 149 amends and clarifies financial accounting and reporting for derivative instruments, including certain derivative instruments embedded in other contracts (collectively, referred to as derivatives) and for hedging activities under SFAS 133. This statement is effective for contracts entered into or modified after June 30, 2003, and for hedging relationships designated after June 30, 2003. The Company adopted SFAS 149 which did not have a material effect on its operating results or financial condition.

F-60

        In May 2003, the FASB issued Statement No. 150, "Accounting For Certain Financial Instruments With Characteristics of Both Liabilities and Equity" ("SFAS 150"). SFAS 150 establishes standards for how a company classifies and measures certain financial instruments with characteristics of both liabilities and equity. It requires that a company classify a financial instrument that is within its scope as a liability (or an asset in some circumstances). As of September 30, 2003 the Company's redeemable junior preferred stock, issued in connection with the Allied Acquisition, is subject to SFAS 150. The Company issued 24,500 shares of junior preferred stock, due in 2010, to an affiliate of Exel, plc, having an initial liquidation preference of $24,500. The dividend rate on the junior preferred stock is 12.4% compounded quarterly and is cumulative, although the payment of dividends is subject to the discretion of the Board of Directors of the Company, and the ability of the Company to pay dividends is subject to various debt agreements. Due to Exel plc being a foreign entity, IRS regulations require withholding taxes to be paid with each quarterly dividend, even if the dividend is notational only. All withholding payments made by the Company reduce the price the Company will ultimately pay to redeem this instrument.

        In certain circumstances the junior preferred stock is exchangeable at the option of the Company for subordinated exchange debentures of the Company. The junior preferred stock is required to be redeemed on the eleventh anniversary of its issue date, or upon the occurrence of certain other events. In addition, the company has a right, subject to the terms of its debt agreements, to redeem the junior preferred stock at any time after the first anniversary of its issued date. As required by SFAS 150, the Company has reclassified $31,487 of redeemable junior preferred stock to redeemable junior preferred obligation, a long-term liability. The settlement amount as of September 30, 2003 was $32,046. Beginning July 1, 2003 the Company has recorded $976 of interest expense, which previously would have been treated as accretion of junior preferred stock dividends.

        Certain reclassifications have been made to the condensed consolidated financial statements for the prior periods presented to conform with the September 30, 2003 presentation.

(2)    Acquisitions

        On June 6, 2003, the Company purchased Scanvan, a Scandinavian-based moving services company, for $23,160, net of acquired cash. The cost of Scanvan has been preliminarily allocated to the net assets acquired and is subject to adjustment when additional information concerning asset and liability valuations is finalized.

        The acquisition of Scanvan was part of the Company's ongoing strategy to expand its relocation and moving capabilities in major regions of the world. This acquisition offered the Company a direct entrance into the Scandinavian market, where it historically had a limited presence. The aggregate consideration for Scanvan was developed assessing both a multiple of earnings and cash flow as well as its complementary geographic locations.

(3)    Income Taxes

        The Company's estimated provision for income taxes differs from the amount computed by applying the U.S. federal and state statutory rates. This difference is primarily due to (1) differences in the statutory rates between the U.S. and countries where the Company has permanently reinvested earnings and (2) tax incentive programs that the Company has qualified for under the laws of certain jurisdictions.

F-61

(4)    Cash and Cash Equivalents

        Cash and cash equivalents included $22,422 and $31,684 at December 31, 2002 and September 30, 2003, respectively, primarily relating to the Company's wholly owned insurance subsidiaries. While these cash balances may be used without limitation by the insurance subsidiaries for their operations, the payment of cash dividends by the insurance subsidiaries to the Company is principally dependent upon the amount of their statutory policyholders' surplus available for dividend distribution. The insurance subsidiaries' ability to pay cash dividends to the Company is, in turn, generally restricted by law or subject to approval of the insurance regulatory authorities of the states or countries in which they are domiciled. These authorities recognize only statutory accounting practices for determining financial position, results of operations, and the ability of an insurer to pay dividends to its shareholders.

(5)    Long-term Debt and Capital Lease Obligations

        Long-term debt and capital lease obligations consisted of the following:

	December 31, 2002		September 30, 2003
Revolving credit facility	$	27,000	$	82,000
Note payable – Tranche A		120,000		105,038
Note payable – Tranche B		209,887		208,264
Senior Discount Loan		56,578		63,503
Senior Subordinated Notes		150,000		150,000
Capital Lease Obligations		18,971		22,746
Other		16,657		17,396
Total debt and capital lease obligations		599,093		648,947
Less current maturities		27,261		26,996
Total long-term debt and capital lease obligations	$	571,832	$	621,951

The Company guarantees certain operating lines of credit maintained by wholly owned foreign subsidiaries. As of December 31, 2002 and September 30, 2003, the outstanding balance was $1,074 million and $2,614 million, respectively.

        The consolidated leverage ratio and interest coverage ratio of September 30, 2003 were 3.61 to 1.00 and 3.39 to 1.00, respectively, compared to required ratios of < 4.60 to 1.00 and > 2.35 to 1.00, respectively.

F-62

(6)    Stockholders' Equity, Redeemable Common Stock and Redeemable Junior Preferred Stock

        Following is an analysis of stockholders' equity, redeemable common stock and redeemable junior preferred stock:

	Stockholders' Equity
	Total			Accumulated deficit			Accumulated other compre- hensive income (loss)			Common stock		Common stock purchase warrant		Additional paid-in- capital			Treasury stock			Redeemable common stock			Redeemable junior preferred stock
Balance at December 31, 2002	$	128,296		$	(39,620	)	$	(29,075	)	$	552	$	655	$	198,032		$	(2,248	)	$	7,375		$	30,401
Comprehensive income (loss):
Net income		30,910			30,910			—			—		—		—			—			—			—
Unrealized hedging loss, net of tax benefit of $(989)		(1,924	)		—			(1,924	)		—		—		—			—			—			—
Net change in unrealized holding gain on available-for-sale securities, net of tax of $102		(4	)		—			(4	)		—		—		—			—			—			—
Minimum pension liability, net of tax of $2,232		(2,232	)		—			(2,232	)		—		—		—			—			—			—
Foreign currency translation adjustment, net of tax of $2,851		5,031			—			5,031			—		—		—			—			—			—
Total comprehensive income		31,781			—			—			—		—		—			—			—			—
Accretion of redeemable common stock		(331	)		—			—			—		—		(331	)		—			331			—
Stock repurchases		—			—			—			—		—		—			—			(1,392	)		—
Issuance of common stock		941			—			—			1		—		940			—			5,214			—
Accretion of junior preferred stock		(1,901	)		—			—			—		—		(1,901	)		—			—			1,901
Taxes paid		—			—			—			—		—		—			—			—			(815	)
Reclassified to junior preferred obligation		—			—			—			—		—		—			—			—			(31,487	)
Balance at September 30, 2003	$	158,786		$	(8,710	)	$	(28,204	)	$	553	$	655	$	196,740		$	(2,248	)	$	11,528		$	—

(7)    Commitments and Contingencies

(a)    Litigation

        The Company was a defendant in a personal injury suit resulting from a 1996 accident involving one of its agent's drivers. The case was tried in 1998, and the Company was found liable. After appeals, a final judgment of $15,229 was rendered in 2002 and fully paid by the Company and two of its insurers. After certain insurance payments and reimbursements, the Company has paid $7,637, which the Company believes is fully reimbursable by insurance; however, one of the Company's several co-insurers of this case has filed suit, contesting its coverage obligations. If the co-insurer prevails, there is the possibility that some or all of the payment made by the Company will not be reimbursed. The Company has a reserve that it considers appropriate in the circumstances.

        The Company has produced and is producing records in response to grand jury subpoenas issued in connection with an investigation being conducted by attorneys in the Department of Justice Antitrust Division through a grand jury in the Eastern District of Virginia. The Company is cooperating with the investigation and understands that numerous other companies have received similar subpoenas. We believe that the investigation relates to the transportation of U.S. military members' household goods between the U.S. and foreign countries, which is

F-63

managed and administered by the Military Transportation and Management Command of the U.S. Army, utilizing private moving companies.

        While the investigation is ongoing and exposes the Company to potential criminal, civil, and administrative penalties, it is difficult to predict its outcome with certainty at this time before the government makes its decisions and advises the Company of them. Management believes that, based on information currently available to it, the investigation's outcome will not have a material adverse impact on the Company's overall operations or financial condition, although there can be no assurance that it will not. Any potential fines, penalties or judgments, however, may have a material effect on the Company's earnings in the period in which they are recognized.

        Some of the Company's moving services operations in Europe are being investigated by European antitrust regulators. The investigations are in the very early stages and involve certain anticompetitive practices. The relevant operations represented less than 1.5% of consolidated operating revenue in the aggregate for the years ended December 31, 2000, 2001 and 2002, and the nine months ended September 30, 2003. The investigations could expose the Company to administrative and other penalties. The Company is cooperating with the investigations which the Company expects will take several years to complete. Management believes that, based on information currently available to it, the outcome of the investigations will not have a material adverse impact on the Company's overall operations or financial condition, although there can be no assurance that it will not. Any potential penalties, however, may have a material impact on the Company's earnings in the period in which they are recognized.

        The Company and certain subsidiaries are defendants in numerous lawsuits relating principally to motor carrier operations. In the opinion of management, after consulting with its legal counsel, the amount of the Company's ultimate liability resulting from these matters will not materially affect the Company's financial position, results of operations or liquidity, although such liability may be material to any given quarter.

(b)    Environmental Matters

        The Company has been named as a potentially responsible party ("PRP") in two environmental cleanup proceedings brought under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, or similar state statutes. Based on all known information, the Company believes that the cost to resolve liability at these sites would not be materially or significantly larger than the reserves established which totaled $35 as of December 31, 2002 and September 30, 2003 respectively. These reserves are based upon the Company's allocation of the total estimated cleanup costs as a de minimis contributor pursuant to agreed orders executed with the Indiana Department of Environmental Management and the U.S. Environmental Protection Agency. The Company has made no provision for expected insurance recovery. The Company could incur significant unanticipated costs, however, if additional contamination is found at these sites, or if it is named as a PRP in other proceedings.

        The Company owns or has owned and leases or has leased facilities at which underground storage tanks are located and operated. Management believes that the Company has taken the appropriate and necessary action with regard to releases that have occurred. Based on its assessment of the facts and circumstances now known and after consulting with its legal counsel, management believes that it has recorded appropriate estimates of liability for those environmental matters of which the Company is aware. Further, management believes it is unlikely that any identified matters, either individually or in aggregate, will have a material effect on the Company's financial position, results of operations or liquidity. As conditions may exist on these properties related to environmental

F-64

problems that are latent or as yet unknown, there can be no assurance that the Company will not incur liabilities or costs in the future, the amount of which cannot be estimated reliably at this time.

(c)    Purchase Commitments

        Purchase commitments consisted of the following:

	December 31, 2002		September 30, 2003
Outsourcing agreements	$	176,382	$	167,253
Software licenses		4,297		2,790
Transportation equipment		1,608		2,243
Other		358		—
	$	182,645	$	172,286

        On July 1, 2002, the Company entered into a ten-year purchase commitment with Covansys Corporation and Affiliated Computer Services, Inc. to provide selected outsourcing services for the Company's domestic information systems infrastructure, including data center operations and telecommunications and certain application software development. As of September 30, 2003, the remaining purchase commitment was $163,311. For the nine months ended September 30, 2003, the Company paid Covansys $5,398. Covansys Corporation is a related party, as 24.5% of its outstanding common stock is owned by Clayton, Dubilier & Rice Fund VI Limited Partnership, a Cayman Islands exempted limited partnership ("Fund VI"). As of September 30, 2003, Fund VI held approximately 23.5% of the capital stock of the Company. Fund VI is managed by Clayton, Dubilier & Rice, Inc. a private investment firm that is organized as a Delaware corporation, and is an affiliate of our controlling shareholder, Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands exempted limited partnership.

(8)    Earnings Per Share

        A reconciliation of net income to income available to common stockholders and basic to diluted share amounts is as follows:

	Nine months ended September 30
	2002			2003
Net income	$	17,003		$	30,910
Less preferred share dividends		(2,683	)		(1,902	)
Less accretion of redeemable common stock		—			(331	)
Net income available to common stockholders	$	14,320		$	28,677
Basic weighted average common shares outstanding		50,182,133			56,670,610
Assumed conversion of stock options and awards		117,268			2,529,508
Diluted weighted average common shares outstanding		50,299,401			59,200,118

F-65

(9)    Operating Segments

        The Company has four reportable segments—1) Relocation Solutions-North America, 2) Relocation Solutions-Europe and Asia Pacific, together forming Global Relocation Solutions, 3) Network Services, and 4) Transportation Solutions. Intersegment transactions, principally relating to international operations, are recorded at market rates as determined by management. The consolidation process results in the appropriate elimination of intercompany transactions, with revenues reflected in the segment responsible for billing the end customer.

Global Relocation Solutions

        The Company's Global Relocation Solutions business provides a combination of relocation services, global mobility services and moving and storage services that we tailor by geographic region to the specific needs of our customers. Global Relocation Solutions is comprised of the Relocation Services—North America and the Relocation Solutions—Europe and Asia Pacific reportable segments. This business provides the following services:

•

Relocation Services: Relocation services include realtor services for home sales and purchases, tax and expense management and closing and destination services.



•

Global Mobility Services: These services include assignment management programs, destination services to identify housing, schools, and other critical client needs, as well as expatriate tax and expense management services.



•

Moving and Storage Services:



•

Household Goods:    The Company provides worldwide household goods moving and storage services, including sales, packing, loading, transportation, delivery and warehousing. In the U.S. and Canada, moving and storage services are provided through a network of exclusive agents. Outside of the U.S. and Canada, the Company provides these services through a network of company owned branches throughout the U.K., Europe and the Asia Pacific region.



•

Commercial Customers:    The Company provides a broad portfolio of services to commercial customers, including office and industrial relocations and records management.



•

Transportation of High-Value Products:    The Company provides customized solutions to facilitate the movement of high-value products that require specialized transport and handling such as electronics, telecommunications and medical equipment and fine art.

Network Services

        The Company's Network Services segment offers a variety of services for truck drivers, fleet owners and agents, both inside and outside the Company's network. Services offered include insurance coverage such as vehicle liability, occupational accident, physical damage and inland marine insurance coverage, as well as truck maintenance and repair services and group purchasing. In addition, the Company offers a suite of services including fuel, cell phone, tire services, legal assistance and retirement programs to the members of the Company's National Association of Independent Truckers, an association of independent contract truck drivers.

Transportation Solutions

        The Company provides a unique combination of third-party logistics transportation solutions designed to benefit a select market niche of customers that require transportation management, inventory visibility at the serialized level, and delivery solutions that are coordinated at the item level to deliver commercial goods that require specialized handling in a timely manner, and with the proper equipment to fit the situation.

F-66

        The tables below represent information about revenues, income from operations and total assets by segment used by the chief operating decision-maker of the Company:

			Nine Months Ended
			September 30, 2002			September 30, 2003
Operating Revenues
	Relocation Solutions – North America		$	1,173,138		$	1,240,440
	Relocation Solutions – Europe and Asia Pacific			300,098			350,891
		Global Relocation Solutions		1,473,236			1,591,331
	Network Services			89,860			117,885
	Transportation Solutions			82,488			75,972
	Corporate			—			—
Consolidated operating revenues			$	1,645,584		$	1,785,188
Income (loss) from operations
	Relocation Solutions – North America		$	35,255		$	44,862
	Relocation Solutions – Europe and Asia Pacific			17,178			23,857
		Global Relocation Solutions		52,433			68,719
	Network Services			17,858			26,125
	Transportation Solutions			3,798			1,825
	Corporate			(951	)		(3,775	)
Consolidated income from operations			$	73,138		$	92,894

			As of
			December 31, 2002		September 30, 2003
Total assets
	Relocation Solutions – North America		$	745,025	$	866,821
	Relocation Solutions – Europe and Asia Pacific			372,588		440,803
		Global Relocation Solutions		1,117,613		1,307,624
	Network Services			221,444		255,030
	Transportation Solutions			18,478		21,010
	Corporate			—		—
Consolidated total assets			$	1,357,535	$	1,583,664

(10)    Restructuring

        In June 2001, the Transportation Solutions operating segment established a program to exit the parts center business. The charges included severance and employee benefit costs for 293 employees, lease and asset impairment costs to shut down and exit the parts center business by the end of 2001. Due to lease terms and severance agreements, certain facility lease payments will continue through September 2005. During the nine months ended September 30, 2002, $842 of restructuring credit occurred when the Company was able to sublease certain parts center facilities earlier than originally estimated.

F-67

(11)    Equity Based Compensation Expense

        For the nine months ended September 30, 2003, the Company recognized $3.0 million of non-cash equity-based compensation expense in relation to stock subscriptions and stock option grants made to certain managers and directors in June and August 2003. The expense has been recorded as the difference between the subscription or exercise price and the deemed fair value of the Company's common and redeemable common stock on the date of grant in accordance with APB 25. The total non-cash equity-based compensation expense to be recognized by the Company in respect of these transactions is $6.7 million. The Company expects to recognize $0.5 million in the fourth quarter of 2003 and $1.5 million, $0.8 million, $0.5 million, $0.3 million and $0.1 million in each of 2004, 2005, 2006, 2007 and 2008 respectively.

F-68

SIRVA, INC.
Notes to Condensed Consolidated Financial Statements

(Dollars in thousands except share and per share data)
(Unaudited)

(12)    Supplemental Information

        The following summarized consolidating balance sheets, statements of operations and statements of cash flows were prepared to segregate such financial statements between those entities that have guaranteed the Company's senior subordinated notes, issued by NAVL, a wholly-owned subsidiary of the Company, issued in connection with the Allied Acquisition ("Guarantor" entities) and those entities that did not guarantee such debt ("Non-Guarantor" entities). The Company is not party to the senior subordinated notes and provides no guarantees thereto.

        Consolidated condensed balance sheet data as of December 31, 2002 and September 30, 2003 is summarized as follows:

		December 31, 2002
		Parent		Issuer(1)		Total Guarantors(2)		Non- Guarantors		Eliminations			Consolidated
Current assets:
	Accounts and notes receivable, net	$	—	$	100,220	$	140,764	$	81,770	$	(13,189	)	$	309,565
	Other current assets		2,447		35,993		51,739		114,278		(1,251	)		203,206
Total current assets			2,447		136,213		192,503		196,048		(14,440	)		512,771
Property and equipment, net			—		54,187		22,163		94,907		—			171,257
Goodwill and intangible assets, net			157		537,836		3,235		15,955		2,141			559,324
Other assets			220,046		289,548		195,438		332,344		(923,193	)		114,183
Total assets		$	222,650	$	1,017,784	$	413,339	$	639,254	$	(935,492	)	$	1,357,535
Current liabilities		$	—	$	92,696	$	210,489	$	230,641	$	(11,168	)	$	522,658
Long-term debt and capital lease obligations			56,578		505,846		221		9,187		—			571,832
Other liabilities			—		198,294		25,307		16,252		(142,880	)		96,973
Total liabilities			56,578		796,836		236,017		256,080		(154,048	)		1,191,463
Redeemable common stock			7,375		—		—		—		—			7,375
Redeemable junior preferred stock			30,401		—		—		—		—			30,401
Stockholder's equity			128,296		220,948		177,322		383,174		(781,444	)		128,296
Total liabilities and stockholder's equity		$	222,650	$	1,017,784	$	413,339	$	639,254	$	(935,492	)	$	1,357,535

F-69

		September 30, 2003
		Parent		Issuer(1)		Total Guarantors(2)		Non- Guarantors		Eliminations			Consolidated
Current assets:
	Accounts and notes receivable, net	$	—	$	115,198	$	210,279	$	108,390	$	(14,016	)	$	419,851
	Other current assets		3,753		36,811		74,883		178,886		(1,251	)		293,082
Total current assets			3,753		152,009		285,162		287,276		(15,267	)		712,933
Property and equipment, net			—		47,537		18,811		107,444		—			173,792
Goodwill and intangible assets, net			157		571,486		3,235		542		2,090			577,510
Other assets			271,875		240,065		224,712		460,164		(1,077,387	)		119,429
Total assets		$	275,785	$	1,011,097	$	531,920	$	855,426	$	(1,090,564	)	$	1,583,664
Current liabilities		$	—	$	110,877	$	274,286	$	280,263	$	(12,113	)	$	653,313
Long-term debt and capital lease obligations			63,503		544,029		216		14,203		—			621,951
Redeemable junior preferred obligation			32,046		—		—		—		—			32,046
Other liabilities			9,922		99,056		46,790		4		(49,732	)		106,040
Total liabilities			105,471		753,962		321,292		294,470		(61,845	)		1,413,350
Redeemable common stock			11,528		—		—		—		—			11,528
Stockholder's equity			158,786		257,135		210,628		560,956		(1,028,719	)		158,786
Total liabilities and stockholder's equity		$	275,785	$	1,011,097	$	531,920	$	855,426	$	(1,090,564	)	$	1,583,664

        Consolidated condensed statements of operations data for the nine months ended September 30, 2002 and 2003 are summarized as follows:

	Nine months ended September 30, 2002
	Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Eliminations			Consolidated
Operating revenues	$	—		$	563,590		$	644,046		$	477,556		$	(39,608	)	$	1,645,584
Total operating expenses		950			550,312			616,497			444,295			(39,608	)		1,572,446
Income (loss) from operations		(950	)		13,278			27,549			33,261			—			73,138
Non-operating (income) expense		—			(2,556	)		—			2,872			—			316
Interest expense (income)		6,103			35,613			(7,585	)		10,779			—			44,910
Dividend income		—			—			—			(12,695	)		12,695			—
Income (loss) before income taxes		(7,053	)		(19,779	)		35,134			32,305			(12,695	)		27,912
Provision (benefit) for income taxes		(2,015	)		838			4,077			8,009			—			10,909
Equity (income) loss		(22,041	)		(42,278	)		2,658			—			61,661			—
Net income (loss)	$	17,003		$	21,661		$	28,399		$	24,296		$	(74,356	)	$	17,003

F-70

	Nine months ended September 30, 2003
	Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Eliminations			Consolidated
Operating revenues	$	—		$	559,418		$	699,316		$	574,422		$	(47,968	)	$	1,785,188
Total operating expenses		801			553,372			657,553			528,536			(47,968	)		1,692,294
Income (loss) from operations		(801	)		6,046			41,763			45,886			—			92,894
Non-operating (income) expense		—			(2,304	)					2,113			—			(191	)
Interest expense (income)		8,120			34,259			2,586			979			—			45,944
Dividend income		—			—			—			(1,091	)		1,091			—
Income (loss) before income taxes		(8,921	)		(25,909	)		39,177			43,885			(1,091	)		47,141
Provision (benefit) for income taxes		(2,620	)		5,156			535			13,160			—			16,231
Equity (income) loss		(37,211	)		(66,381	)		(13,483	)		—			117,075			—
Net income (loss)	$	30,910		$	35,316		$	52,125		$	30,725		$	(118,166	)	$	30,910

        Consolidated condensed statements of cash flows data for nine months ended September 30, 2002 and 2003 are summarized as follows:

		Nine months ended September 30, 2002
		Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Consolidated
Net cash provided by (used for) operating activities		$	(86,579	)	$	33,292		$	19,110		$	59,813		$	25,636
Cash flows from investing activities:
	Additions of property and equipment		—			(3,002	)		(6,145	)		(15,804	)		(24,951	)
	Proceeds from sale of property and equipment		—			641			1,241			454			2,336
	Purchases of investments		—			—			—			(43,522	)		(43,522	)
	Proceeds from maturity or sale of investments		—			—			—			45,627			45,627
	Acquisitions, net of cash acquired		(157	)		(94,564	)		—			(7,789	)		(102,510	)
	Other investing activites		—			(505	)		(743	)		—			(1,248	)
Net cash used by investing activities			(157	)		(97,430	)		(5,647	)		(21,034	)		(124,268	)
Cash flows from financing activities:
	Borrowings from revolving and other financing facilities, net.		—			3,000			—			37,936			40,936
	Borrowings of long-term debt		—			50,403			—			—			50,403
	Proceeds from issuance of common stock		88,026			56,500			—			(83,037	)		61,489
	Repayments on long-term debt and capital lease obligations		—			(25,977	)		(7	)		(1,815	)		(27,799	)
Other financing activities			(1,290	)		(9,004	)		(2,460	)		161			(12,593	)
Net cash provided by (used for) financing activities			86,736			74,922			(2,467	)		(46,755	)		112,436
Effect of translation adjustments on cash			—			—			—			987			987
Net increase (decrease) in cash and cash equivalents			—			10,784			10,996			(6,989	)		14,791
Cash and cash equivalents at beginning of period			—			5,687			4,054			22,378			32,119
Cash and cash equivalents at end of period		$	—		$	16,471		$	15,050		$	15,389		$	46,910

F-71

		Nine months ended September 30, 2003
		Parent			Issuer(1)			Total Guarantors(2)			Non- Guarantors			Consolidated
Net cash provided by (used for) operating activities		$	(558	)	$	(20,792	)	$	12,634		$	31,146		$	22,430
Cash flows from investing activities:
	Additions of property and equipment		—			(3,224	)		(4,449	)		(9,726	)		(17,399	)
	Proceeds from sale of property and equipment		—			834			162			3,700			4,696
	Purchases of investments		—			—			—			(82,614	)		(82,614	)
	Proceeds from maturity or sale of investments		—			—			—			61,136			61,136
	Acquisitions, net of cash acquired		—			(7,263	)		1,362			(23,522	)		(29,423	)
	Other investing activities		—			(672	)		(1,523	)		—			(2,195	)
Net cash used by investing activities			—			(10,325	)		(4,448	)		(51,026	)		(65,799	)
Cash flows from financing activities:
	Borrowings on revolving and other financing facilities, net.		—			55,000			—			30,167			85,167
	Borrowings of long-term debt		—			449			—			—			449
	Repayments on long-term debt and capital lease obligations		—			(19,541	)		—			(2,055	)		(21,596	)
	Other financing activities		558			(1,257	)		(2,863	)		(3,107	)		(6,669	)
Net cash provided by financing activities			558			34,651			(2,863	)		25,005			57,351
Effect of translation adjustments on cash			—			—			—			1,257			1,257
Net increase (decrease) in cash and cash equivalents			—			3,534			5,323			6,382			15,239
Cash and cash equivalents at beginning of period			—			4,280			10,849			30,351			45,480
Cash and cash equivalents at end of period		$	—		$	7,814		$	16,172		$	36,733		$	60,719

(1)

Issuer includes the accounts of North American Van Lines, Inc., a Delaware corporation and the issuer of the debt.

(2)

Total Guarantors include the accounts of the following direct or indirect subsidiaries of North American Van Lines, Inc. or its subsidiary, Allied Van Lines, Inc.:

F-72

Name	Incorporated
A Relocation Solutions Management Company	Delaware
Allied Freight Forwarding, Inc.	Delaware
Allied International N.A., Inc.	Delaware
Allied Transportation Forwarding, Inc.	Delaware
Allied Van Lines, Inc.	Delaware
Allied Van Lines Terminal Company	Delaware
Federal Traffic Service, Inc.	Indiana
Fleet Insurance Management, Inc.	Indiana
FrontRunner Worldwide, Inc.	Delaware
Global Van Lines, Inc.	Indiana
Great Falls North American, Inc.	Montana
Meridian Mobility Resources, Inc.	Delaware
NACAL, Inc.	California
National Association of Independent Truckers, LLC	Delaware
North American Logistics, Ltd.	Indiana
North American Van Lines of Texas, Inc.	Texas
SIRVA Freight Forwarding, Inc.	Indiana
SIRVA Global Relocation, Inc.	Delaware
SIRVA Imaging Solutions, Inc., (formerly known as Relocation Management Systems, Inc.)	Delaware
SIRVA Relocation LLC	Delaware
SIRVA Title Agency, Inc.	Ohio
StorEverything, Inc.	Delaware
Vanguard Insurance Agency, Inc.	Illinois

        Each Guarantor is a wholly owned subsidiary of North American Van Lines, Inc. or its subsidiary, Allied Van Lines, Inc. and jointly and severally, irrevocably and fully and unconditionally guarantees the punctual payment of such debt issued under North American Van Lines, Inc.'s senior credit facility and senior subordinated notes.

(13)    Subsequent Event

        On November 7, 2003, the Company's Board of Directors approved a 3.17 for one stock split of the Company's common stock, which will be effected by means of reclassification. The stock split will become effective prior to the consummation of the Company's initial public offering of common stock. In connection with the stock split, the Company filed a certificate of amendment to its certificate of incorporation on November 10, 2003 that will increase the number of shares of its common stock from 24,000,000 to 500,000,000. Periods presented have been restated to show the effect of the stock split.

F-73

SCHEDULE II
SIRVA, INC.
Valuation and Qualifying Accounts for
the Years Ended December 31, 2000, 2001 and 2002

Col. A		Col. B		Col. C				Col. D			Col. E
				Additions
Description		Balance at Beginning of Period		Charged to Costs and Expenses		Charged to Other Accounts (a)		Deductions (b)			Balance at End of Period
2000:
	Allowance for doubtful accounts	$	18,771	$	7,131	$	1,194	$	(375	)	$	26,721
	Valuation allowance for contracts receivable		255		—		—		—			255
		$	19,026	$	7,131	$	1,194	$	(375	)	$	26,976
2001:
	Allowance for doubtful accounts	$	26,721	$	5,558	$	—	$	(7,893	)	$	24,386
	Valuation allowance for contracts receivable		255		112		—		—			367
		$	26,976	$	5,670	$	—	$	(7,893	)	$	24,753
2002:
	Allowance for doubtful accounts	$	24,386	$	6,891	$	1,078	$	(7,296	)	$	25,059
	Valuation allowance for contracts receivable		367		—		—		(251	)		116
	Allowance for loss on sale of relocation properties held for resale		—		1,453		1,422		(1,103	)		1,772
		$	24,753	$	8,344	$	2,500	$	(8,650	)	$	26,947

(a)

Primarily related to acquisitions.

(b)

Primarily related to write-offs of accounts receivable, net of recoveries and currency translation.

F-74

Inside Back Cover Description: SIRVA's various brands arranged in an inverted triangle formation

        Through and including             , 2003 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

21,052,632 Shares

Common Stock

PROSPECTUS
                  , 2003

Credit Suisse First Boston
Goldman, Sachs & Co.

Deutsche Bank Securities
Banc of America Securities LLC
Citigroup
JPMorgan

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

        The following table itemizes the expenses incurred by the Registrant in connection with the issuance and distribution of the securities being registered, other than underwriting discounts. All the amounts shown are estimates except the Securities and Exchange Commission registration fee and the NASD filing fee.

Registration fee—Securities and Exchange Commission	$	39,173
Filing fee—National Association of Securities Dealers, Inc.	$	30,500
Listing fee	$	*
Accounting fees and expenses	$	*
Legal fees and expenses (other than blue sky)	$	*
Printing; stock certificates	$	*
Transfer agent and registrar fees	$	*
Miscellaneous	$	*
Total	$	*

*

To be completed by amendment.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

        Section 145 of the Delaware General Corporation Law, or DGCL, provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees)), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. Section 145 further provides that a corporation similarly may indemnify any such person serving in any such capacity who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorney's fees) actually and reasonably incurred in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the' best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Delaware Court of Chancery or such other court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all of the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Delaware Court of Chancery or such other court shall deem proper.

        SIRVA'S Amended Certificate of Incorporation and its Amended and Restated By-Laws authorize the indemnification of officers and directors of the corporation consistent with Section 145 of the Delaware Corporation Law, as amended, and to the fullest extent permitted under Delaware law.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

        The following sets forth information, as of September 30, 2003, regarding all sales of our unregistered securities during the past three years. All such shares were issued in reliance upon an exemption or exemptions from registration under the Securities Act by reason of Section 4(2) of the Securities Act or Rule 701 promulgated under

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Section 3(b) of the Securities Act, as transactions by an issuer not involving a public offering or transactions pursuant to compensatory benefit plans relating to compensation as provided under Rule 701. In connection with the transactions for which an exemption is claimed pursuant to Section 4(2) of the Securities Act, the securities were sold to a limited number of persons and/or accredited investors, such persons were provided access to all relevant information regarding us and represented to us that they were either "sophisticated" investors or were represented by persons with knowledge and experience in financial and business matters who were capable of evaluating the merits and risks of the prospective investment, and such persons represented to us that the shares were purchased for investment purposes only and with no view toward distribution. In connection with the issuances of securities for which an exemption is claimed pursuant to Rule 701, the securities have been offered and issued by us to executive officers and employees and consultants for compensating purposes pursuant to written plans or arrangements.

        The following table sets forth the date of each sale or grant, the number of purchasers and/or grantees, and the number of shares and/or options sold or granted on such date.

Date of Issuance	Number of Share Acquirers/Option Grantees	Number of Shares of SIRVA Common Stock Sold	Aggregate Consideration Received by SIRVA ($)	Number of Options To Purchase Shares of SIRVA Common Stock Granted (3)
December 5, 2000	18 agents	92,976	416,486.00	—
December 27, 2000	4 managers	64,351	288,260.00	12,870
December 14, 2001	12 managers	—	—	26,945
December 31, 2001 (1)	72 managers	93,007	416,628.00	21,219
December 31, 2001 (1)	Guidance Solutions, Inc.	250,049	1,120,096.00	—
December 31, 2001 (1)	Clayton, Dubilier & Rice Fund V Limited Partnership	5,581,006	25,000,094.00	—
February 15, 2002	20 managers	295,919	1,325,570.00	58,667
February 15, 2002	1 director	158,500	710,000.00	—
April 12, 2002	Clayton, Dubilier & Rice Fund VI Limited Partnership	4,464,818	20,000,132.00	—
May 3, 2002	Clayton, Dubilier & Rice Fund VI Limited Partnership	8,929,604	40,000,122.00	—
July 30, 2002	3 managers	58,549	262,274.00	—
July 30, 2002	3 directors	176,664	791,366.00	—
July 30, 2002	2 agents	10,397	46,576.00	—
August 1, 2002 (2)	1 director	294	—	—
September 30, 2002 (2)	5 directors	4,926	—	—
November 15, 2002	24 managers	756,368	3,388,148.40	1,734,636
January 1, 2003 (2)	2 directors	3,429	—	—
March 30, 2003 (2)	3 directors	3,731	—	—
June 9, 2003	9 managers	231,603	1,351,628.50	461,494
June 9, 2003	6 directors	92,953	542,475.50	—
June 27, 2003	12 managers	204,465	1,193,250.00	408,930
June 30, 2003 (2)	3 directors	2,234	—	—
August 8, 2003	1 manager	31,700	185,000.00	63,400

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(1)

The shares of our common stock issued to managers, Guidance Solutions and Clayton, Dubilier & Rice Fund V Limited Partnership on December 31, 2001 were issued in consideration for all of each such stockholder's shares of Class A common stock, par value $.01 per share, of Moveline, Inc. The exercise price of the options issued to managers on December 31, 2001 was $4.48 per share.

(2)

Securities issued to directors on August 1, 2002, September 30, 2002, January 1, 2003, March 30, 2003, and June 30, 2003 were issued pursuant to the Directors Compensation Plan in consideration for services rendered by such directors.

(3)

The exercise price of the options granted from December 27, 2000 until prior to January 1, 2003 was $4.48 per share. The exercise price of all options granted on or after January 1, 2003 was $5.84 per share.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)

List of Exhibits.

The attached Exhibit Index is incorporated by reference.

(b)

Financial Statement Schedules.

Schedule II, Valuation and Qualifying Accounts for the years ended December 31, 2000, 2001 and 2002, is filed as part of this report. All other schedules are omitted as the information required is either included elsewhere in the consolidated financial statements herein or is not applicable.

ITEM 17. UNDERTAKINGS

        The undersigned registrant hereby undertakes as follows:

        (1)   The undersigned will provide to the underwriters at the closing specified in the Underwriting Agreement certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

        (2)   For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance on Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

        (3)   For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

        Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described in Item 14 or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

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SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Westmont, State of Illinois, on November 12, 2003.

SIRVA, INC.
By:	/s/  BRIAN P. KELLEY Name: Brian P. Kelley Title: President and Chief Executive Officer

        Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed by the following persons in the capacities stated on November 12, 2003.

/s/  BRIAN P. KELLEY Brian P. Kelley		Director, President and Chief Executive Officer (principal executive officer)
JAMES W. ROGERS * James W. Rogers		Director and Chairman of the Board of Directors
KATHLEEN J. AFFELDT * Kathleen J. Affeldt		Director
ROBERT J. DELLINGER* Robert J. Dellinger		Director
JEREMY MACKENZIE* Jeremy Mackenzie		Director
EDWARD H. ORZETTI * Edward H. Orzetti		Director
RICHARD J. SCHNALL * Richard J. Schnall		Director
CARL T. STOCKER * Carl T. Stocker		Director
/s/  JOAN E. RYAN Joan E. Ryan		Senior Vice President and Chief Financial Officer (principal financial officer)
DENNIS M. THOMPSON * Dennis M. Thompson		Vice President, Corporate Controller (principal accounting Officer)
*By:	/s/  JOAN E. RYAN Joan E. Ryan Attorney-in-fact

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Exhibits

Exhibit Number	Description of Document	Method of Filing
1.1	Form of Underwriting Agreement	To be filed by amendment.
3.1	Form of Restated Certificate of Incorporation of SIRVA, Inc.	Filed herewith.
3.2	Form of Amended and Restated By-Laws of SIRVA, Inc.	To be filed by amendment.
4.1	Indenture, dated as of November 19, 1999, among North American Van Lines, Inc., State Street Bank and Trust Company and the subsidiary guarantors party thereto	Previously filed as Exhibit 4.1 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
4.2	Form of 133/8 Senior Subordinated Note due 2009 (included in Exhibit 4.1)	Previously filed as Exhibit 4.3 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
4.3	Registration Rights Agreement, dated November 19, 1999, among North American Van Lines, Inc., Banc of America Securities LLC, Chase Securities Inc. and the subsidiary guarantors party thereto	Previously filed as Exhibit 4.2 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
5.1	Opinion of Debevoise & Plimpton	To be filed by amendment.
10.1	Acquisition Agreement, dated as of September 14, 1999, between NA Holding Corporation and NFC plc, now known as Exel plc	Previously filed as Exhibit 10.1 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.2	Amendment No. 1 to the Acquisition Agreement, dated as of November 19, 1999, between NA Holding Corporation and NFC plc, now known as Exel plc	Previously filed as Exhibit 10.2 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.3	Letter Agreement, dated as of November 19, 1999, among NA Holding Corporation, Clayton, Dubilier & Rice Fund V Limited Partnership and NFC plc, now known as Exel plc, with respect to rights and obligations of NFC by virtue of its acquisition of 1,749,610 shares of common stock, par value $0.01 per share, of NA Holding Corporation	Previously filed as Exhibit 10.10 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.4	Stock Subscription Agreement, dated as of November 19, 1999, between the NA Holding Corporation and Clayton, Dubilier & Rice Fund V Limited Partnership	Previously filed as Exhibit 10.11 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.5	Stock Subscription Agreement dated as of November 19, 1999, between NA Holding Corporation and NFC plc, now known as Exel plc	Previously filed as Exhibit 10.12 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.

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10.6	Transition Services Agreement, dated as of November 19, 1999, by and between NFC plc, now known as Exel plc, and NA Holding Corporation	Previously filed as Exhibit 10.15 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.7	Tax Matters Agreement, dated as of September 14, 1999, between NA Holding Corporation and NFC plc, now known as Exel plc	Previously filed as Exhibit 10.16 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.8	Credit Agreement, dated as of November 19, 1999 and amended as of November 23, 1999, among North American Van Lines, Inc., the foreign subsidiary borrowers from time to time parties thereto, the several banks and other financial institutions from time to time parties thereto, The Bank of New York, as documentation agent, Banc of America Securities LLC, as syndication agent, and The Chase Manhattan Bank, as collateral and administrative agent	Previously filed as Exhibit 10.3 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.9	Second Amendment, dated as of August 11, 2000, to the Credit Agreement, dated as of November 19, 1999 and amended as of November 23, 1999, among North American Van Lines, Inc., the foreign subsidiary borrowers from time to time parties thereto, the several banks and other financial institutions from time to time parties thereto, The Bank of New York, as documentation agent, Banc of America Securities LLC, as syndication agent, and The Chase Manhattan Bank, as collateral and administrative agent	Previously filed as Exhibit 10.18 to Amendment No. 1 to North American Van Lines, Inc. Form S-4, filed April 4, 2002 and incorporated herein by reference.
10.10	Third Amendment and Waiver, dated as of December 21, 2001, to the Credit Agreement, dated as of November 19, 1999 and amended as of November 23, 1999, among North American Van Lines, Inc., the foreign subsidiary borrowers from time to time parties thereto, the several banks and other financial institutions from time to time parties thereto, The Bank of New York, as documentation agent, Banc of America Securities LLC, as syndication agent, and The Chase Manhattan Bank, as collateral and administrative agent	Previously filed as Exhibit 10.19 to Amendment No. 1 to North American Van Lines, Inc. Form S-4, filed April 4, 2002 and incorporated herein by reference.

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10.11	Fourth Amendment, dated as of March 19, 2002, to the Credit Agreement, dated as of November 19, 1999 and amended as of November 23, 1999, among North American Van Lines, Inc., the foreign subsidiary borrowers from time to time parties thereto, the several banks and other financial institutions from time to time parties thereto, The Bank of New York, as documentation agent, Banc of America Securities LLC, as syndication agent, and The Chase Manhattan Bank, as collateral and administrative agent	Previously filed as Exhibit 10.20 to Amendment No. 2 to North American Van Lines, Inc. Form S-4, filed May 22, 2002 and incorporated herein by reference.
10.12	Fifth Amendment, dated as of April 30, 2002, to the Credit Agreement, dated as of November 19, 1999 and amended as of November 23, 1999, among North American Van Lines, Inc., the foreign subsidiary borrowers from time to time parties thereto, the several banks and other financial institutions from time to time parties thereto, The Bank of New York, as documentation agent, Banc of America Securities LLC, as syndication agent, and The Chase Manhattan Bank, as collateral and administrative agent	Previously filed as Exhibit 10.21 to Amendment No. 2 to North American Van Lines, Inc. Form S-4, filed May 22, 2002 and incorporated herein by reference.
10.13	Sixth Amendment, dated April 24, 2003, to the Credit Agreement, dated as of November 19, 1999 and amended as of November 23, 1999, among North American Van Lines, Inc., the foreign subsidiary borrowers from time to time parties thereto, the several banks and other financial institutions from time to time parties thereto, The Bank of New York, as documentation agent, Banc of America Securities LLC, as syndication agent, and The Chase Manhattan Bank, as collateral and administrative agent	Previously filed as Exhibit 10.13 to Amendment No. 1 to SIRVA, Inc. Form S-1, filed October 16, 2003 and incorporated herein by reference.
10.14	Indemnification Agreement, dated as of March 30, 1998, among NA Holding Corporation, NA Acquisition Corporation, North American Van Lines, Clayton, Dubilier & Rice, Inc. and Clayton, Dubilier & Rice Fund V Limited Partnership	Previously filed as Exhibit 10.6 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.15	Consulting Agreement, dated as of March 30, 1998, among NA Holding Corporation, NA Acquisition Corporation, and North American Van Lines, Inc. and Clayton, Dubilier & Rice, Inc.	Previously filed as Exhibit 10.7 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.

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10.16	Amended and Restated Consulting Agreement, dated as of January 1, 2001, by and among SIRVA, Inc., North American Van Lines, Inc. and Clayton, Dubilier & Rice, Inc.	Previously filed as Exhibit 10.17 to Amendment No. 1 to North American Van Lines, Inc. Form S-4, filed April 4, 2002 and incorporated herein by reference.
10.17	Registration and Participation Agreement, dated as of March 30, 1998, among NA Holding Corporation and Clayton, Dubilier & Rice Fund V Limited Partnership	Previously filed as Exhibit 10.8 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.18	Amendment No. 1, dated as of November 19, 1999, to the Registration and Participation Agreement, dated as of March 30, 1998, among NA Holding Corporation and Clayton, Dubilier & Rice Fund V Limited Partnership	Previously filed as Exhibit 10.9 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.19	Amendment No. 2, dated as of May 30, 2002, to the Registration and Participation Agreement, dated as of March 30, 1998, among NA Holding Corporation and Clayton, Dubilier & Rice Fund V Limited Partnership	Previously filed as Exhibit 10.20 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.20	Guaranty and Collateral Agreement, dated as of November 19, 1999, made by NA Holding Corporation, North American Van Lines, Inc. and certain of its subsidiaries in favor of The Chase Manhattan Bank, as collateral agent and administrative agent	Previously filed as Exhibit 10.4 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.21	Common Stock Purchase Warrant No. 1, dated as of November 19, 1999, for 87,480 shares of NA Holding Corporation's Common Stock, issued in the name of NFC International Holdings (Netherlands II) BV, now known as Exel International Holdings (Netherlands 2) BV	Previously filed as Exhibit 10.5 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.22	Loan Agreement, dated as of November 19, 1999, between NA Holding Corporation, Blue Ridge Investments, LLC and The Chase Manhattan Bank.	Previously filed as Exhibit 10.23 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.23	First Amendment, dated as of February 16, 2000, to the Loan Agreement dated as of November 19, 1999, among Allied Worldwide, Inc., formerly known as NA Holding Corporation (now known as SIRVA, Inc.), Blue Ridge Investments, LLC, and Chase Securities Inc.	Previously filed as Exhibit 10.24 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.

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10.24	Second Amendment, dated as of April 14, 2000, to the Loan Agreement dated as of November 19, 1999, among Allied Worldwide, Inc., Blue Ridge Investments, LLC, and Chase Securities Inc.	Previously filed as Exhibit 10.25 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.25	Third Amendment, dated as of June 23, 2000, to the Loan Agreement dated as of November 19, 1999, among Allied Worldwide, Inc., Blue Ridge Investments, LLC, and Chase Securities Inc.	Previously filed as Exhibit 10.26 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.26	Fourth Amendment, dated as of October 11, 2000, to the Loan Agreement dated as of November 19, 1999, among Allied Worldwide, Inc., Blue Ridge Investments, LLC, and Chase Securities Inc.	Previously filed as Exhibit 10.27 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.27	Fifth Amendment, dated as of January 10, 2001, to the Loan Agreement dated as of November 19, 1999, among Allied Worldwide, Inc., Blue Ridge Investments, LLC, and Chase Securities Inc.	Previously filed as Exhibit 10.28 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.28	Sixth Amendment, dated as of April 5, 2001, to the Loan Agreement dated as of November 19, 1999, among Allied Worldwide, Inc., Blue Ridge Investments, LLC, and Chase Securities Inc.	Previously filed as Exhibit 10.29 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.29	Seventh Amendment, dated as of June, 2001, to the Loan Agreement dated as of November 19, 1999, among Allied Worldwide, Inc., Blue Ridge Investments, LLC, and Chase Securities Inc.	Previously filed as Exhibit 10.30 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.30	Eighth Amendment, dated as of October 2, 2001, to the Loan Agreement dated as of November 19, 1999, among Allied Worldwide, Inc., Blue Ridge Investments, LLC, and Chase Securities Inc.	Previously filed as Exhibit 10.31 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.31	Ninth Amendment, dated as of January 2, 2002, to the Loan Agreement dated as of November 19, 1999, among Allied Worldwide, Inc., Blue Ridge Investments, LLC, and J.P. Morgan Securities Inc., formerly known as Chase Securities Inc.	Previously filed as Exhibit 10.32 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.

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10.32	Tenth Amendment, dated as of April 2, 2002, to the Loan Agreement dated as of November 19, 1999, among SIRVA, Inc., Blue Ridge Investments, LLC, and J.P. Morgan Securities Inc.	Previously filed as Exhibit 10.33 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.33	Eleventh Amendment, dated as of July 1, 2002, to the Loan Agreement dated as of November 19, 1999, among SIRVA, Inc., formerly known as Allied Worldwide, Inc., Blue Ridge Investments, LLC, and J.P. Morgan Securities Inc.	Previously filed as Exhibit 10.34 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.34	Twelfth Amendment, dated as of July 29, 2002, to the Loan Agreement dated as of November 19, 1999, among SIRVA, Inc., Blue Ridge Investments, LLC, and J.P. Morgan Securities Inc.	Previously filed as Exhibit 10.35 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.35	Thirteenth Amendment, dated as of August 14, 2002, to the Loan Agreement dated as of November 19, 1999, among SIRVA, Inc., Blue Ridge Investments, LLC, and J.P. Morgan Securities Inc.	Previously filed as Exhibit 10.36 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.36	Fourteenth Amendment, dated as of September 10, 2002, to the Loan Agreement dated as of November 19, 1999, among SIRVA, Inc., Blue Ridge Investments, LLC, and J.P. Morgan Securities Inc.	Previously filed as Exhibit 10.37 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.37	Fifteenth Amendment, dated as of October 29, 2002, to the Loan Agreement dated as of November 19, 1999, among SIRVA, Inc., Blue Ridge Investments, LLC, Mt. Mitchell Capital Funding, LLC, and J.P. Morgan Securities Inc.	Previously filed as Exhibit 10.38 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.38	Sixteenth Amendment, dated as of November 12, 2002, to the Loan Agreement dated as of November 19, 1999, among SIRVA, Inc., Blue Ridge Investments, LLC, Mt. Mitchell Capital Funding, LLC, and J.P. Morgan Securities Inc.	Previously filed as Exhibit 10.39 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.39	Seventeenth Amendment, dated as of November 12, 2002, to the Loan Agreement dated as of November 19, 1999, among SIRVA, Inc. and Arawak, Ltd. (together with its permitted successors and assigns under the Agreement), as successor and assign of Blue Ridge Investments, LLC, Mt. Mitchell Capital Funding, LLC and J.P. Morgan Securities Inc.	Previously filed as Exhibit 10.40 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.

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10.40	Third Amendment to the Third Amended and Restated Warehousing Credit and Security Agreement, dated as of July 30, 2003, by and among SIRVA Mortgage, Inc., the lenders from time to time party thereto, Washington Mutual Bank, F.A., as a lender, lead arranger and agent, and National City Bank of Kentucky, as documentation agent.	Previously filed as Exhibit 10.40 to Amendment No. 1 to SIRVA, Inc. Form S-1, filed October 16, 2003 and incorporated herein by reference.
10.41	Stock Subscription Agreement, dated as of April 12, 2002, between SIRVA, Inc. and Clayton, Dubilier & Rice Fund VI Limited Partnership	Previously filed as Exhibit 10.22 to Amendment No. 2 to North American Van Lines, Inc. Form S-4, filed May 22, 2002 and incorporated herein by reference.
10.42	SIRVA, Inc. Omnibus Stock Incentive Plan	To be filed by amendment.
10.43	Form of Option Agreement under the SIRVA, Inc. Omnibus Stock Incentive Plan	To be filed by amendment.
10.44	SIRVA, Inc. Stock Incentive Plan	Previously filed as Exhibit 10.45 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.45	First Amendment to the SIRVA, Inc. Stock Incentive Plan, dated as of                , 2003	To be filed by amendment.
10.46	Form of Management Stock Subscription Agreement for SIRVA, Inc.	Previously filed as Exhibit 10.13 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.47	Form of Other Investor Stock Subscription Agreement for SIRVA, Inc.	Previously filed as Exhibit 10.48 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.48	Form of Management Stock Option Agreement for SIRVA, Inc.	Previously filed as Exhibit 10.14 to North American Van Lines, Inc. Form S-4, filed February 4, 2000 and incorporated herein by reference.
10.49	SIRVA, Inc. Directors Compensation Plan	Previously filed as Exhibit 10.50 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.50	First Amendment to the SIRVA, Inc. Directors Compensation Plan, dated as of                , 2003	To be filed by amendment.
10.51	Form of Directors Award Agreement under the SIRVA, Inc. Directors Compensation Plan	Previously filed as Exhibit 10.24 to North American Van Lines, Inc. Form S-4, filed June 18, 2002 and incorporated herein by reference.
10.52	SIRVA, Inc. Management Incentive Plan	To be filed by amendment.
10.53	Letter Agreement, dated as of July 8, 2002, by and between SIRVA, Inc. and Brian P. Kelley	Previously filed as Exhibit 10.54 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.

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10.54	Amendment to the Letter Agreement, dated as of                , 2003, by and between SIRVA, Inc. and Brian P. Kelley	To be filed by amendment.
10.55	Employment Agreement, dated as of December 5, 1994, by and between Allied Van Lines, Inc. and Michael P. Fergus	Previously filed as Exhibit 10.56 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.56	Fee and Guarantee Agreement, dated as of December 22, 1999, among North American Van Lines, Inc. and The Chase Manhattan Bank	Previously filed as Exhibit 10.57 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.57	First Amendment, dated as of December 27, 2000, to the Fee and Guarantee Agreement, dated as of December 22, 1999, among North American Van Lines, Inc.and The Chase Manhattan Bank	Previously filed as Exhibit 10.58 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.58	Second Amendment, dated as of February 5, 2002, to the Fee and Guarantee Agreement, dated as of December 22, 1999, among North American Van Lines, Inc. and The Chase Manhattan Bank	Previously filed as Exhibit 10.59 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.59	Fee and Guarantee Agreement, dated as of November 15, 2002, among North American Van Lines and JPMorgan Chase Bank	Previously filed as Exhibit 10.60 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.60	First Amendment, dated as of June 20, 2003, to the Fee and Guarantee Agreement, dated as of November 15, 2002, among North American Van Lines, Inc. and JPMorgan Chase Bank	Previously filed as Exhibit 10.61 to SIRVA, Inc. Form S-1, filed August 25, 2003 and incorporated herein by reference.
10.61	Form of Restricted Stock Agreement under the SIRVA, Inc. Omnibus Stock Incentive Plan	To be filed by amendment.
21.1	List of Subsidiaries of SIRVA, Inc.	Previously filed as Exhibit 21.1 to Amendment No. 1 to SIRVA, Inc. Form S-1, filed October 16, 2003 and incorporated herein by reference.
23.1	Consent of Debevoise & Plimpton	Included as part of Exhibit 5.1.
23.2	Consent of PricewaterhouseCoopers LLP	Filed herewith.
24.1	Powers of Attorney	Included in signature pages of SIRVA, Inc. Form S-1, filed August 25, 2003.

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Corporate History
Principal Stockholders
The Offering
Internal Reorganization and Refinancing
Risk Factors
SUMMARY CONSOLIDATED FINANCIAL AND OTHER DATA
RISK FACTORS
FORWARD-LOOKING STATEMENTS
INTERNAL REORGANIZATION AND REFINANCING
USE OF PROCEEDS
DIVIDEND POLICY
CAPITALIZATION
DILUTION
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
THE RELOCATION INDUSTRY
Illustrative Breakdown of Corporate Spending on a $60,000 Domestic Relocation
BUSINESS
Premium In Force at December 31, 2002
MANAGEMENT
PRINCIPAL STOCKHOLDERS
SELLING STOCKHOLDERS
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
DESCRIPTION OF OUR INDEBTEDNESS
DESCRIPTION OF CAPITAL STOCK
SHARES ELIGIBLE FOR FUTURE SALE
MATERIAL U.S. FEDERAL TAX CONSIDERATIONS
UNDERWRITING
Paid by SIRVA
Paid by the Selling Stockholders
LEGAL MATTERS
EXPERTS
WHERE YOU CAN FIND MORE INFORMATION
INDEX TO FINANCIAL STATEMENTS
Report of Independent Accountants
SIRVA, INC. Consolidated Balance Sheets At December 31, 2001 and 2002 (Dollars in thousands)
SIRVA, INC. Consolidated Balance Sheets At December 31, 2001 and 2002 (Dollars in thousands except share and per share data)
SIRVA, INC. Consolidated Statements of Operations For the years ended December 31, 2000, 2001 and 2002 (Dollars in thousands except share and per share data)
SIRVA, INC. Consolidated Statements of Cash Flows For the years ended December 31, 2000, 2001 and 2002 (Dollars in thousands)
SIRVA, INC. Notes to Consolidated Financial Statements (Dollars in thousands except share and per share data)
SIRVA, INC. Condensed Consolidated Balance Sheets At December 31, 2002 and September 30, 2003 (Dollars in thousands except share data) (Unaudited)
SIRVA, INC. Condensed Consolidated Income Statements For the nine months ended September 30, 2002 and 2003 (Dollars in thousands except share and per share data) (Unaudited)
SIRVA, INC. Condensed Consolidated Statements of Cash Flows For the nine months ended September 30, 2002 and 2003 (Dollars in thousands) (Unaudited)
SCHEDULE II SIRVA, INC. Valuation and Qualifying Accounts for the Years Ended December 31, 2000, 2001 and 2002
PART II INFORMATION NOT REQUIRED IN PROSPECTUS
SIGNATURES
Exhibits

EX-3.1

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Exhibit 3.1

RESTATED CERTIFICATE OF INCORPORATION

OF

SIRVA, INC.

        1.     The name of the Corporation is "SIRVA, Inc." The original name of the Corporation was "NA Holding Corporation".

        2.     The original Certificate of Incorporation of the Corporation (as amended, the "Original Certificate of Incorporation") was filed with the Secretary of State of the State of Delaware on December 19, 1997, under the name "NA Holding Corporation". The Certificate of Incorporation was amended several times, including on December 7, 1999 to change the name of the Corporation to "Allied Worldwide, Inc." and on March 7, 2002 to change the name of the Corporation to "SIRVA, Inc."

        3.     This Restated Certificate of Incorporation has been duly adopted by the Board of Directors of the Corporation at a duly convened meeting of the Board of Directors on November 7, 2003 and by a written consent of the stockholders of the Corporation entitled to vote thereon dated November 7, 2003, in accordance with the provisions of Sections 141, 228, 242 and 245 of the General Corporation Law of the State of Delaware, as applicable.

        4.     This Restated Certificate of Incorporation shall become effective at 9:00 A.M. on November 24, 2003 (the "Effective Time").

        5.     Effective as of the Effective Time, the Original Certificate of Incorporation is hereby further amended and restated so as to read in its entirety as follows:

ARTICLE I

NAME OF CORPORATION

        The name of the Corporation is "SIRVA, Inc." (the "Corporation").

ARTICLE II

REGISTERED OFFICE

        The Corporation's registered office in the State of Delaware is at Corporation Trust Center, 1209 Orange Street in the City of Wilmington, County of New Castle. The name of its registered agent at such address is The Corporation Trust Company.

ARTICLE III

PURPOSE

        The nature of the business of the Corporation and its purpose is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the "DGCL").

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ARTICLE IV

CAPITAL STOCK

        Section 1.    Authorized Stock.

        (a)   The total number of shares of all stock which the Corporation has authority to issue is 550,000,000 shares, consisting of (i) 500,000,000 shares of common stock, par value of $0.01 per share (the "Common Stock"), and (ii) 50,000,000 shares of preferred stock, par value of $0.01 per share (the "Preferred Stock"), issuable in one or more series as hereinafter provided.

        (b)   The number of authorized shares of the Common Stock or Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the voting power of the stock of the Corporation entitled to vote generally in the election of directors irrespective of the provisions of Section 242(b)(2) of the DGCL or any corresponding provision hereinafter enacted, with such outstanding shares of Common Stock and other stock considered for this purpose a single class of stock.

        (c)   Without any further action of the Corporation or any stockholder, each share of Common Stock, par value $0.01 per share, of the Corporation which immediately prior to the Effective Time was outstanding or held as treasury stock shall be reclassified into, become and shall be deemed to represent 3.17 shares of Common Stock (such reclassifications collectively, the "Reclassification"). No fractional shares of Common Stock shall be issued upon the Reclassification. If any fraction of a share of Common Stock would otherwise be issuable upon the Reclassification, the Corporation shall, in lieu of issuing any fractional shares of Common Stock, pay to each stockholder who would otherwise be entitled to receive a fractional share an amount in cash equal to such fraction multiplied by the per share initial public offering price of the Common Stock in the Corporation's initial underwritten public offering of Common Stock, computed to the nearest whole cent. Whether a stockholder holds fractional shares after such reclassification shall be determined on the basis of the total number of shares of Common Stock held by such holder immediately prior to such reclassification and the number of shares of Common Stock issuable upon such aggregate reclassification.

        Section 2.    Provisions Relating to the Common Stock.

        (a)    Voting.    Except as otherwise provided in this Restated Certificate of Incorporation or by applicable law, each holder of shares of Common Stock shall be entitled, with respect to each share of Common Stock held by such holder, to one vote in person or by proxy on all matters submitted to a vote of the holders of Common Stock, whether voting separately as a class or otherwise.

        (b)    Dividends and Distributions.    Subject to the preferences and rights, if any, applicable to shares of Preferred Stock or any series thereof, the holders of shares of Common Stock shall be entitled to receive such dividends and other distributions in cash, property, stock or otherwise as may be declared thereon by the Board of Directors at any time and from time to time out of assets or funds of the Corporation legally available therefor.

        (c)    Liquidation Rights.    In the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation, after payment or provision for payment of the debts and other liabilities of the Corporation, and subject to the preferences and rights, if any, applicable to shares of Preferred Stock or any series thereof, the holders of shares of Common Stock shall be entitled to receive all of the remaining assets of the Corporation available for distribution to its stockholders, ratably in proportion to the number of shares of Common Stock held by them.

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        Section 3.    Provisions Relating to the Preferred Stock.

        (a)    General.

        (i)    The Preferred Stock may be issued at any time and from time to time in one or more series. The Board of Directors is hereby authorized to provide for the issuance of shares of Preferred Stock in one or more series and, by filing a certificate of designation pursuant to the applicable provisions of the DGCL (a "Preferred Stock Certificate of Designation"), to establish from time to time the number of shares to be included in each such series, and to fix the designation, powers, preferences and rights, and the qualifications, limitations and restrictions thereof, of shares of each such series.

        (ii)   The authority of the Board of Directors with respect to each series of Preferred Stock shall include, but not be limited to, determination of the following:

        1.     the designation of the series, which may be by distinguishing number, letter or title;

        2.     the number of shares of the series, which number the Board of Directors may thereafter (except where otherwise provided in the applicable Preferred Stock Certificate of Designation) increase or decrease (but not below the number of shares thereof then outstanding);

        3.     the preferences, if any, and relative, participating, optional or other special rights, if any, and the qualifications, limitations or restrictions thereof, if any, of the series;

        4.     whether dividends, if any, shall be cumulative or noncumulative and the dividend rate, if any, of the series;

        5.     whether dividends, if any, shall be payable in cash, in kind or otherwise;

        6.     the dates on which dividends, if any, shall be payable;

        7.     the redemption rights and price or prices, if any, for shares of the series;

        8.     the terms and amount of any sinking fund provided for the purchase or redemption of shares of the series;

        9.     the amounts payable on shares of the series in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the affairs of the Corporation;

        10.   whether the shares of the series shall be convertible into or exchangeable for shares of any other class or series, or any other security, of the Corporation or any other corporation, and, if so, the specification of such other class or series or such other security, the conversion or exchange price or prices or rate or rates, any adjustments thereof, the date or dates as of which such shares shall be convertible or exchangeable and all other terms and conditions upon which such conversion or exchange may be made;

        11.   restrictions on the issuance of shares of the same series or of any other class or series;

        12.   whether or not the holders of the shares of such series shall have voting rights, in addition to the voting rights provided by law, and if so, the terms of such voting rights, which may provide, among other things and subject to the other provisions of this Restated Certificate of Incorporation, that each share of such series shall carry one vote or more or less than one vote per share, that the holders of such series shall be entitled to vote on certain matters as a separate class (which for such purpose may be comprised solely of such series or of such series and one or more other series or classes of stock of the Corporation); and

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        13.   such other rights and provisions with respect to any series that the Board of Directors may provide.

        (iii)  The Common Stock shall be subject to the express terms of the Preferred Stock and any series thereof.

        (b)    Junior Preferred Stock.    In the event that there is any share of junior exchangeable preferred stock, par value $0.01 per share ("Junior Preferred Stock"), of the Corporation outstanding at the Effective Time, there shall be a class of preferred stock designated the "Junior Exchangeable Preferred Stock" having the powers, preferences, and other special rights and the qualifications, limitations and restrictions thereof set forth in Annex I to this Restated Certificate of Incorporation. In the event that there is no share of Junior Preferred Stock outstanding on or after the date of closing of the Corporation's initial underwritten public offering of Common Stock, without any further action by the Corporation, this Section 3(b) shall be of no further force and effect and there shall be no class of preferred stock designated the "Junior Exchangeable Preferred Stock".

        Section 4.    Voting in Election of Directors.    Except as may be required by law or as provided in this Restated Certificate of Incorporation or in a Preferred Stock Certificate of Designation, holders of Common Stock shall have the exclusive right to vote for the election of directors and for all other purposes, and holders of Preferred Stock shall not be entitled to vote on any matter or receive notice of any meeting of stockholders.

        Section 5.    Ownership of Capital Stock.    The Corporation shall be entitled to treat the person in whose name any share of its stock is registered as the owner thereof for all purposes and shall not be bound to recognize any equitable or other claim to, or interest in, such share on the part of any other person, whether or not the Corporation shall have notice thereof, except as expressly provided by applicable law.

ARTICLE V

BOARD OF DIRECTORS

        Section 1.    Classified Board of Directors.    The Directors of the Corporation, subject to the rights of the holders of shares of any class or series of Preferred Stock, shall be classified with respect to the time for which they severally hold office, into three classes, as nearly equal in number as possible, as shall be provided in the By-laws of the Corporation, one class ("Class I") whose term expires at the 2004 annual meeting of stockholders, another class ("Class II") whose term expires at the 2005 annual meeting of stockholders, and another class ("Class III") whose term expires at the 2006 annual meeting of stockholders, with each class to hold office until its successors are elected and qualified. At each annual meeting of stockholders of the Corporation, the date of which will be fixed pursuant to the By-Laws of the Corporation, and subject to the rights of the holders of shares of any class or series of Preferred Stock, the successors of the class of directors whose term expires at that meeting shall be elected to hold office for a term expiring at the annual meeting of stockholders held in the third year following the year of their election.

        Section 2.    Removal for Cause.    Subject to the rights of the holders of any class or series of Preferred Stock, if any, to elect additional Directors under specified circumstances, any Director may be removed at any time, but only for cause, upon the affirmative vote of the holders of a majority of the combined voting power of the then outstanding stock of the Corporation entitled to vote generally in the election of Directors.

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ARTICLE VI

MANAGEMENT OF CORPORATION

        The following provisions are inserted for the management of the business and for the conduct of the affairs of the Corporation and for the purpose of creating, defining, limiting and regulating the powers of the Corporation and its directors and stockholders:

        (a)   Except as may otherwise be provided in a Preferred Stock Certificate of Designation with respect to vacancies or newly created directorships in respect of directors, if any, elected by the holders of one or more series of Preferred Stock, vacancies in the Board of Directors resulting from death, resignation, retirement, disqualification, removal from office or other cause and newly created directorships resulting from any increase in the authorized number of directors shall only be filled by a majority of the directors then in office, although less than a quorum, or by a sole remaining director.

        (b)   Advance notice of nominations for the election of directors shall be given in the manner and to the extent provided in the By-Laws of the Corporation.

        (c)   The election of Directors may be conducted in any manner approved by the officer presiding at a meeting of stockholders or the Director presiding at a meeting of the Board of Directors, as the case may be, at the time when the election is held and need not be by written ballot.

        (d)   All corporate powers and authority of the Corporation (except as at the time otherwise provided by law, by this Certificate of Incorporation or by the By-Laws) shall be vested in and exercised by the Board of Directors.

        (e)   The Board of Directors shall have the power without the assent or vote of the stockholders to adopt, amend, alter or repeal the By-Laws of the Corporation, except to the extent that the By-Laws or this Certificate of Incorporation otherwise provide. The stockholders of the Corporation may adopt, amend, alter or repeal any provision of the By-Laws upon the affirmative vote of the holders of at least three-fourths (³/4) of the then outstanding stock of the Corporation entitled to vote generally in the election of directors.

        (f)    There shall be no limitation on the qualification of any person to be elected as or to be a director of the Corporation or on the ability of any director to vote on any matter brought before the Board of Directors or any committee thereof, except (i) as required by applicable law, (ii) as set forth in this Restated Certificate of Incorporation or (iii) as set forth in any By-Law adopted by the Board of Directors with respect to eligibility for election as a director upon reaching a specified age or, in the case of employee directors, with respect to the qualification for continuing service of directors upon ceasing employment with the Corporation.

ARTICLE VII

LIABILITY OF DIRECTORS

        Section 1.    General.

        No director of the Corporation shall be personally liable to the Corporation or its stockholders for monetary damages for breach of his or her fiduciary duty as a director, except to the extent that this limitation on or exemption from liability is not permitted under the DGCL as currently in effect or as the same may hereafter be amended.

        Section 2.    Indemnification.

        The Corporation shall indemnify and advance expenses to the directors of the Corporation to the fullest extent permitted by the applicable provisions of the DGCL, as now or hereafter in effect,

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provided that, except as otherwise provided in the By-Laws of the Corporation, the Corporation shall not be obligated to indemnify or advance expenses to a director of the Corporation in respect of an action, suit or proceeding (or part thereof) instituted by such director, unless such action, suit or proceeding (or part thereof) has been authorized by the Board of Directors. The rights provided by this Article VII, Section 2 shall not limit or exclude any rights, indemnities or limitations of liability to which any director of the Corporation may be entitled, whether as a matter of law, under the By-Laws of the Corporation, by agreement, vote of the stockholders or disinterested directors of the Corporation, or otherwise.

        Section 3.    Repeal or Modification.

        Any repeal or modification of this Article VII shall not adversely affect any right or protection of a director of the Corporation existing in respect of any act or omission occurring prior to the time of such repeal or modification. If the DGCL is amended after the filing of this Restated Certificate of Incorporation to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended.

ARTICLE VIII

NO STOCKHOLDER ACTION BY WRITTEN CONSENT; SPECIAL MEETINGS

        Effective as of the closing of the Corporation's initial underwritten public offering of Common Stock, any action required or permitted to be taken by the stockholders of the Corporation must be effected at a duly called annual or special meeting of the stockholders of the Corporation, and the ability of the stockholders to consent in writing to the taking of any action is specifically denied. Except as otherwise provided in the By-Laws of the Corporation, a special meeting of the stockholders of the Corporation may be called only by or at the direction of the Board of Directors, and any right of the stockholders of the Corporation to call a special meeting of the stockholders is specifically denied.

ARTICLE IX

SECTION 203 OF THE GENERAL CORPORATION LAW

        The Corporation elects not to be governed by Section 203 of the General Corporation Law of the State of Delaware, "Business Combinations With Interested Stockholders", as permitted under and pursuant to subsection (b)(3) of Section 203 of the General Corporation Law of the State of Delaware.

ARTICLE X

AMENDMENT

        The Corporation reserves the right to amend or repeal any provision contained in this Restated Certificate of Incorporation in the manner now or hereafter prescribed by the laws of the State of Delaware, and all rights herein conferred upon stockholders or directors (in the present form of this Restated Certificate of Incorporation or as hereinafter amended) are granted subject to this reservation, provided, however, that any amendment or repeal of Article VII shall not adversely affect any right or protection existing under this Certificate of Incorporation immediately prior to such amendment or repeal, and provided, further, that Articles V, VII, VIII, this Article X and paragraph (e) of Article VI shall not be amended, altered or repealed without the affirmative vote of the holders of at least three-fourths (³/4) of the then outstanding stock of the Corporation entitled to vote generally in the election of directors.

        .

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        IN WITNESS WHEREOF, said Corporation has duly caused this Restated Certificate of Incorporation to be signed by Ralph A. Ford, its Senior Vice President, General Counsel and Secretary, and attested by Susan Vertrees, Executive Assistant to Ralph A. Ford, this 10^th day of November, 2003.

	By:	/s/  RALPH A. FORD Ralph A. Ford Senior Vice President, General Counsel and Secretary
ATTEST:
/s/  SUSAN VERTREES Susan Vertrees Executive Assistant to Ralph A. Ford

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Annex I

THE POWERS, PREFERENCES AND RELATIVE,
PARTICIPATING, OPTIONAL AND OTHER SPECIAL RIGHTS OF
JUNIOR EXCHANGEABLE PREFERRED STOCK DUE 2010 AND
QUALIFICATIONS, LIMITATIONS AND RESTRICTIONS THEREOF

        (a)    Designation.

        There is hereby created out of the authorized and unissued shares of preferred stock of the Company a class of preferred stock designated as the "Junior Exchangeable Preferred Stock" (the "Junior Preferred Stock"). The number of shares constituting such class shall be 24,500. The initial liquidation preference of each share of Junior Preferred Stock shall be $1,000.00 per share. As of any time, the liquidation preference of any share of Junior Preferred Stock shall be an amount equal to the excess of $1,000.00 over the Adjustment Amount with respect to such share (such amount, the "Liquidation Preference").

        (b)    Rank.

        The Junior Preferred Stock shall, with respect to dividend distributions and distributions upon the liquidation, winding-up and dissolution of the Company, rank (i) senior to all classes of common stock of the Company (the "Common Stock") and each other class of Capital Stock or series of Preferred Stock of the Company hereafter created by the Board of Directors the terms of which do not expressly provide that it ranks on a parity with or senior to the Junior Preferred Stock as to dividend distributions and distributions upon the liquidation, winding-up and dissolution of the Company (collectively referred to with the Common Stock of the Company as "Junior Securities"), (ii) on a parity with any class of Capital Stock or series of Preferred Stock hereafter created by the Board of Directors, the terms of which expressly provide that such class or series shall rank on a parity with the Junior Preferred Stock as to dividend distributions and distributions upon the liquidation, winding-up and dissolution of the Company (collectively referred to as "Parity Securities"), and (iii) junior to any class of Capital Stock or series of Preferred Stock hereinafter created by the Board of Directors, the terms of which expressly provide that such class or series shall rank senior to the Junior Preferred Stock as to dividend distributions and distributions upon the liquidation, winding up and dissolution of the Company (collectively referred to as "Senior Securities").

        (c)    Dividends.

        (i)    On each Dividend Payment Date, the Holder of an outstanding share of Junior Preferred Stock shall be entitled to receive, when, as and if declared by the Board of Directors, out of funds legally available therefor, dividends on such share of Junior Preferred Stock, at a quarterly rate of 3.10%, such quarterly rate to be multiplied by the Stated Amount of such share as of such time. All dividends shall be cumulative, whether or not earned or declared, on a daily basis from the Issue Date and if declared shall be payable quarterly on each Dividend Payment Date with respect to the quarter ending on such Dividend Payment Date, commencing on the first Dividend Payment Date after the Issue Date. Each distribution in the form of a dividend shall be payable to the Holders of record as they appear on the stock register of the Company on such record date, not less than 10 nor more than 60 days preceding the related Dividend Payment Date, as shall be fixed by the Board of Directors. Dividends shall cease to accumulate in respect of shares of the Junior Preferred Stock (x) on the Exchange Date or on the date of their earlier redemption or purchase, unless the Company shall have failed to issue the appropriate aggregate principal amount of Exchange Debentures in respect of the Junior Preferred Stock on the Exchange Date or shall have failed to pay the relevant redemption price on the date fixed for redemption or the relevant Change of Control Purchase Price on the date fixed for purchase, or (y) subject to the issuance of the shares of Successor Company Stock as contemplated by paragraph (l)(i) hereof, on any earlier Conversion Date. Dividends payable on shares of the Junior Preferred Stock for any period less than three months shall be computed on the basis of a 90-day quarter of three 30-day months and

the actual number of days elapsed in the period for which payable. If any Dividend Payment Date occurs on a day that is not a Business Day, any accrued dividends otherwise payable on such Dividend Payment Date shall be paid on the next succeeding Business Day.

        (ii)   All dividends paid with respect to shares of the Junior Preferred Stock pursuant to paragraph (c)(i) shall be paid to the Holders entitled thereto, pro rata in accordance with the respective amounts thereof to which the respective Holders are entitled.

        (iii)  Nothing herein contained shall in any way or under any circumstances be construed or deemed to require the Board of Directors to declare, or the Company to pay or set apart for payment, any dividends on shares of the Junior Preferred Stock at any time.

        (iv)  Dividends on account of arrears for any past Dividend Period may be declared and paid at any time, without reference to any regular Dividend Payment Date, to the Holders of record on such date, not more than 45 days prior to the payment thereof, as may be fixed by the Board of Directors.

        (v)   No full dividends shall be declared by the Board of Directors or paid or funds set apart for payment of dividends by the Company on any Parity Securities for any period (A) during which a Mandatory Redemption Event exists and (B) unless full cumulative dividends shall have been or contemporaneously are declared and paid in full, or declared and a sum in cash set apart sufficient for such payment, on the Junior Preferred Stock for all Dividend Periods terminating on or prior to the date of payment of such full dividends on such Parity Securities. If any dividends are not paid in full, as aforesaid, upon the shares of the Junior Preferred Stock and any other Parity Securities, all dividends declared upon shares of the Junior Preferred Stock and any other Parity Securities shall be declared pro rata so that the amount of dividends declared per share on the Junior Preferred Stock and such Parity Securities shall in all cases bear to each other the same ratio that accrued dividends per share on the Junior Preferred Stock and such Parity Securities bear to each other.

        (vi)  (A) The Holders of shares of the Junior Preferred Stock shall be entitled to receive the dividends provided for in paragraph (c)(i) hereof in preference to and in priority over any dividends upon any of the Junior Securities, as and to the extent provided in paragraphs (c)(vi)(B) and (c)(vii) below.

        (B)  So long as any shares of Junior Preferred Stock are outstanding, the Company shall not declare, pay or set apart for payment any dividend on any of the Junior Securities, or make any distribution in respect thereof, for (1) any period during which a Mandatory Redemption Event or Dividend Default exists and (2) any period prior to a Public Offering unless full cumulative dividends shall have been or contemporaneously are declared and paid in full, or declared and a sum in cash set apart sufficient for such payment, on the Junior Preferred Stock for all Dividend Periods terminating on or prior to the date of payment of such dividends on such Junior Securities.

        (vii) At any time that a Dividend Default or Mandatory Redemption Event exists, so long as any shares of Junior Preferred Stock are outstanding, the Company shall not make any payment on account of, or set apart for payment money for a sinking or other similar fund for, the purchase, redemption or other retirement of, any of the Junior Securities or any warrants, rights, calls or options exercisable for or convertible into any of the Junior Securities, either directly or indirectly, and whether in cash, obligations or shares of the Company or other property, and shall not permit any corporation or other entity directly or indirectly controlled by the Company to purchase or redeem any of the Junior Securities or any such warrants, rights, calls or options.

        (viii) At any time that a Dividend Default or Mandatory Redemption Event exists, so long as any shares of Junior Preferred Stock are outstanding, the Company shall not make any payment on account of, or set apart for payment money for a sinking or other similar fund for, the purchase, redemption or other retirement of, any of the Parity Securities or any warrants, rights, calls or options exercisable for or convertible into any of the Parity Securities, and shall not permit any

corporation or other entity directly or indirectly controlled by the Company to purchase or redeem any of the Parity Securities or any such warrants, rights, calls or options.

        (d)    Liquidation Preference.

        (i)    Upon any voluntary or involuntary liquidation, dissolution or winding-up of the affairs of the Company (determined either for the Company alone or with its Subsidiaries on a consolidated basis), each Holder of any share of Junior Preferred Stock then outstanding shall be entitled to be paid, out of the assets of the Company available for distribution to its stockholders, the Liquidation Preference for such share of the Junior Preferred Stock as of such time, plus, without duplication, an amount in cash equal to all accumulated and unpaid dividends thereon to the date fixed for liquidation, dissolution or winding-up (including an amount equal to a prorated dividend for the period from the last Dividend Payment Date to the date fixed for liquidation, dissolution or winding-up), before any payment shall be made or any assets distributed to the holders of any of the Junior Securities, including, without limitation, Common Stock of the Company. If, upon any voluntary or involuntary liquidation, dissolution or winding-up of the Company, the assets of the Company are not sufficient to pay in full the Liquidation Preference for the Junior Preferred Stock and liquidation preference for all Parity Securities as of such time and the accumulated and unpaid dividends payable to the holders of outstanding shares of the Junior Preferred Stock and all Parity Securities, then the holders of all such shares shall share equally and ratably in such distribution of assets of the Company in proportion to the Liquidation Preference for the Junior Preferred Stock and liquidation preference for all Parity Securities as of such time plus accumulated and unpaid dividends which would be payable on such distribution if the respective amounts thereof to which the Holders of outstanding shares of Junior Preferred Stock and the holders of outstanding shares of all Parity Securities are entitled were paid in full.

        (ii)   After payment of the full amount of the Liquidation Preference and all accumulated and unpaid dividends to which they are entitled, the Holders of shares of the Junior Preferred Stock shall not be entitled to any further participation in any distribution of assets of the Company with respect to the shares of Junior Preferred Stock.

        (iii)  For the purposes of this paragraph (d), neither the sale, conveyance, exchange or transfer (for cash, shares of stock, securities or other consideration) of all or substantially all of the property or assets of the Company nor the consolidation or merger of the Company with or into one or more Persons shall be deemed to be a liquidation, dissolution or winding-up of the affairs of the Company (unless such sale, conveyance, exchange or transfer is in connection with a dissolution or winding-up of the business of the Company, whereby the transferee of such property or assets or the surviving Person in such consolidation or merger does not continue to operate such business as a going concern).

        (e)    Redemption.

        (i)    Optional Redemption.    (A) The Company may (subject to the legal availability of funds therefor), at the option of the Company, redeem at any time on or after the first anniversary of the Issue Date, from any source of funds legally available therefor, in whole or in part, in the manner provided in paragraph (e)(iii) hereof, any or all of the shares of the Junior Preferred Stock, at a redemption price for any such share equal to the sum of (i) the product of (A) the Liquidation Preference of such share as of the applicable Redemption Date, multiplied by (B) the percentage set forth below with respect to such Redemption Date, plus (ii) without duplication, an amount in cash equal to all accumulated and unpaid dividends with respect to such share (including an amount in cash equal to a prorated dividend for the period from the Dividend

Payment Date immediately prior to the Redemption Date to the Redemption Date) (collectively, the "Optional Redemption Price"):

PERIOD	PERCENTAGE
12-month period commencing on the first anniversary of the Issue Date	103	%
12-month period commencing on the second anniversary of the Issue Date	102	%
12-month period commencing on the third anniversary of the Issue Date	101	%
Thereafter	100	%

        (B)  In addition, in the event a Change of Control of the Company is consummated at any time prior to the first anniversary of the Issue Date, the Company may redeem (subject to contractual and other restrictions with respect thereto and the legal availability of funds therefor), in the manner provided in paragraph (e)(iii) hereof, all of but not less than all of the outstanding shares of the Junior Preferred Stock at a redemption price for each share equal to 103% of the Liquidation Preference of such share as of the applicable Redemption Date thereof, plus, without duplication, an amount in cash equal to all accumulated and unpaid dividends with respect to such share (including an amount in cash equal to a prorated dividend for the period from the Dividend Payment Date immediately prior to the Redemption Date to the Redemption Date) (collectively, the "Special Redemption Price").

        (C)  In the event of a redemption of only a portion of the then outstanding shares of the Junior Preferred Stock, the Company shall effect such redemption as it determines, pro rata, according to the number of shares held by each Holder of the Junior Preferred Stock or by lot, as may be determined by the Company in its sole discretion.

        (ii)    Mandatory Redemption.    On the date which is 11 years after the Issue Date, upon the existence and continuance for at least 180 days of any Mandatory Redemption Event (other than a Mandatory Redemption Event pursuant to clause (1) of the definition thereof) or upon the existence and continuance of a Dividend Default for four consecutive quarterly periods, the Company shall redeem (subject to the Debt Agreements (including the availability of funds by dividend from NAVL in compliance therewith), and to the legal availability of funds therefor) in the manner provided in paragraph (e)(iii) hereof, each share of the Junior Preferred Stock then outstanding at a redemption price equal to the Liquidation Preference of such share as of the applicable Redemption Date, plus, without duplication, an amount in cash equal to all accumulated and unpaid dividends with respect to such share (including an amount equal to a prorated dividend for the period from the Dividend Payment Date immediately prior to the Redemption Date to the Redemption Date) (collectively, the "Mandatory Redemption Price").

        (iii)    Procedures for Optional Redemption and Mandatory Redemption.    (A) At least 30 days and not more than 60 days prior to the date fixed for any redemption of the Junior Preferred Stock, written notice (the "Redemption Notice") shall be given by first-class mail, postage prepaid, to each Holder of record on the record date fixed for such redemption of the Junior Preferred Stock at such Holder's address as the same appears on the stock register of the Company, provided that no failure to give such notice nor any deficiency therein shall affect the validity of the procedure for the redemption of any shares of Junior Preferred Stock to be redeemed except as to the Holder or Holders to whom the Company has failed to give said notice or except as to the Holder or Holders whose notice was defective. The Redemption Notice shall state:

        (1)   whether the redemption is pursuant to paragraph (e)(i)(A), (e)(i)(B), or (e)(ii) hereof;

        (2)   the Optional Redemption Price, the Special Redemption Price or the Mandatory Redemption Price, as the case may be;

        (3)   whether all or less than all the outstanding shares of the Junior Preferred Stock are to be redeemed and the total number of shares of the Junior Preferred Stock being redeemed;

        (4)   the number of shares of Junior Preferred Stock held, as of the appropriate record date, by the Holder that the Company intends to redeem;

        (5)   the date fixed for redemption;

        (6)   that the Holder is to surrender to the Company, at the place or places where certificates for shares of Junior Preferred Stock are to be surrendered for redemption, in the manner and at the price designated, the certificate or certificates representing the shares of Junior Preferred Stock to be redeemed; and

        (7)   that dividends on the shares of the Junior Preferred Stock to be redeemed shall cease to accrue on the Redemption Date unless the Company defaults in the payment of the Optional Redemption Price, the Special Redemption Price or the Mandatory Redemption Price, as the case may be.

        (B)  On or prior to the date fixed for redemption, each Holder of Junior Preferred Stock shall surrender the certificate or certificates representing such shares of Junior Preferred Stock to the Company, duly endorsed, in the manner and at the place designated in the Redemption Notice, and on the Redemption Date, the full Optional Redemption Price, the Special Redemption Price or Mandatory Redemption Price, as the case may be, for such shares shall be payable in cash to the Person whose name appears on such certificate or certificates as the owner thereof, and each surrendered certificate shall be canceled and retired. In the event that less than all of the shares represented by any such certificate are redeemed, a new certificate shall be issued representing the unredeemed shares.

        (C)  If the funds of the Company legally available for redemption of shares of Junior Preferred Stock on any Redemption Date are insufficient to redeem the total number of shares of Junior Preferred Stock to be redeemed on such date, or if a complete redemption is not permitted by any Debt Agreement (or any Debt Agreement does not permit NAVL to dividend sufficient legally available funds to the Company to effect a complete redemption), those funds which are legally available shall be used to redeem the maximum possible number of shares of the Holders to the extent permitted by each Debt Agreement and to the extent NAVL is permitted under each Debt Agreement to dividend an equal amount of funds to the Company out of funds legally available therefor. At any time thereafter when additional funds of the Company are legally available for the redemption of shares, such funds shall immediately be used to redeem the balance of the shares of Junior Preferred Stock which the Company has become obligated to redeem, on any Redemption Date but which it has not redeemed, to the extent permitted by each Debt Agreement and to the extent NAVL is permitted under each Debt Agreement to dividend an equal amount of funds to the Company out of funds legally available therefor.

        (D)  Unless the Company defaults in the payment in full of the applicable redemption price, dividends on the Junior Preferred Stock called for redemption shall cease to accumulate on the Redemption Date, and the Holders of such shares shall cease to have any further rights with respect thereto on the Redemption Date, other than the right to receive the Optional Redemption Price, the Special Redemption Price or the Mandatory Redemption Price, as the case may be, without interest.

        (f)    Voting Rights.

        (i)    The Holders of shares of the Junior Preferred Stock, except as otherwise required under the laws of the State of Delaware or as set forth in paragraph (f)(ii) below and in paragraphs (h) and (l) hereof, shall not be entitled or permitted to vote on any matter required or permitted to be voted upon by the stockholders of the Company.

        (ii)   So long as any shares of the Junior Preferred Stock are outstanding, the Company shall not amend this Certificate of Designation so as to affect adversely the specified rights, preferences, privileges or voting rights of the Holders of shares of Junior Preferred Stock.

        (iii)  Notwithstanding paragraph (f)(ii) above, (1) the creation, authorization or issuance of any shares of any Junior Securities, Parity Securities or Senior Securities, (2) the decrease in the amount of authorized capital stock of the Company of any class, (3) the increase in the amount of authorized capital stock of the Company of any class or (4) the conversion or exchange of the Junior Preferred Stock and any action in connection therewith in accordance with paragraph (l)(i), shall not require the consent of the Holders of Junior Preferred Stock and shall not be deemed to affect adversely the rights, preferences, privileges or voting rights of the Holders of shares of the Junior Preferred Stock.

        (g)    Exchange.

        (i)    Requirements.    (A) The Company may at its option exchange all, but not less than all, of the then outstanding shares of Junior Preferred Stock into the Company's Exchange Debentures on any Dividend Payment Date, provided that on the date of such exchange: (1) such exchange is not prohibited by the Debt Agreements; (2) such exchange would comply with the Delaware General Corporation Law; (3) either (a) a registration statement relating to the Exchange Debentures shall have been declared effective under the Securities Act of 1933, as amended (the "Securities Act"), prior to such exchange and shall continue to be in effect on the date of such exchange or (b) (i) the Company shall have obtained a written opinion of counsel to the Company that an exemption from the registration requirements of the Securities Act is available for such exchange and (ii) such exemption is relied upon by the Company for such exchange; and (4) immediately after giving effect to such exchange, no Default or Event of Default (each as defined in the Exchange Debentures) would exist under the Exchange Debentures. In the event that the issuance of the Exchange Debentures is not permitted on the date of exchange or any of the conditions set forth in clauses (1) through (4) of the preceding sentence are not satisfied on the date of exchange, the Company shall use its best efforts to satisfy such conditions and effect such exchange as soon as practicable.

        The Company shall send a written notice (the "Exchange Notice") of exchange by mail to each Holder of record, which notice shall state: (v) that the Company is exercising its option to exchange the Junior Preferred Stock for Exchange Debentures pursuant to this Certificate of Designation; (w) the date fixed for exchange (the "Exchange Date"), which date shall not be less than 30 days nor more than 60 days following the date on which the Exchange Notice is mailed (except as provided in the next sentence of this paragraph); (x) that the Holder is to surrender to the Company, at the place or places where certificates for shares of Junior Preferred Stock are to be surrendered for exchange, in the manner designated in the Exchange Notice, the certificate or certificates representing the shares of Junior Preferred Stock to be exchanged; (y) that dividends on the shares of Junior Preferred Stock to be exchanged shall cease to accrue on the Exchange Date whether or not certificates for shares of Junior Preferred Stock are surrendered for exchange on the Exchange Date unless the Company shall default in the delivery of Exchange Debentures; and (z) that interest on the Exchange Debentures shall accrue from the Exchange Date whether or not certificates for shares of Junior Preferred Stock are surrendered for exchange on the Exchange Date. On the Exchange Date, if the conditions set forth in clauses (1) through (4) above are satisfied, the Company shall issue Exchange Debentures in exchange for the Junior Preferred Stock as provided in the next paragraph.

        (B)  Upon any exchange pursuant to paragraph (g)(i)(A), an Exchange Debenture shall be issued in exchange for each share of Junior Preferred Stock, in registered form without coupons, in a principal amount equal to the Stated Amount as of such time.

        (C)  The Exchange Debentures shall be issued in long form without an indenture and shall be in the form having substantially similar terms, as the form of Exchange Debenture attached as Annex A hereto.

        (ii)    Procedure for Exchange.    (A) On or before the date fixed for exchange, each Holder of Junior Preferred Stock shall surrender the certificate or certificates representing such shares of Junior Preferred Stock, in the manner and at the place designated in the Exchange Notice. The Company shall cause the Exchange Debentures to be executed on the Exchange Date and, upon surrender in accordance with the Exchange Notice of the certificates for any shares of Junior Preferred Stock so exchanged (properly endorsed or assigned for transfer, if the notice shall so state), such shares shall be exchanged by the Company into Exchange Debentures. The Company shall pay interest on the Exchange Debentures at the rate and on the dates specified therein from the Exchange Date.

        (B)  If notice has been mailed as aforesaid, and if before the Exchange Date all Exchange Debentures necessary for such exchange shall have been duly executed by the Company, then on the Exchange Date, dividends shall cease to accrue on the outstanding shares of Junior Preferred Stock and all of the rights of the Holders of shares of the Junior Preferred Stock as stockholders of the Company shall cease (except the right to receive Exchange Debentures), and the Person or Persons entitled to receive the Exchange Debentures issuable upon exchange shall be treated for all purposes as the registered holder or holders of such Exchange Debentures as of the date of exchange.

        (h)    Change of Control.

        (i)    Unless otherwise consented to by the Holders of a majority of the outstanding shares of Junior Preferred Stock, upon the occurrence after the Issue Date of a Change of Control, each Holder of Junior Preferred Stock then outstanding, subject to the other provisions of this paragraph (h), shall have the right (subject to the Debt Agreements (including the availability of funds by dividend from NAVL in compliance therewith), and to the legal availability of funds therefor) to require the Company to purchase any or all of such Holder's shares of Junior Preferred Stock pursuant to an offer (an "Offer") at a purchase price per share in cash equal to 101% of the Liquidation Preference of such share at the purchase date, plus, without duplication, an amount in cash equal to all accumulated and unpaid dividends with respect to such share (including an amount in cash equal to a prorated dividend for the period from the Dividend Payment Date immediately prior to the purchase date, to the purchase date) (collectively, the "Change of Control Purchase Price"). Unless the Company has exercised its right to redeem the Junior Preferred Stock as described under paragraph (e) above, the Company shall, not later than 30 days following the date the Company obtains actual knowledge of any Change of Control having occurred, mail a notice (the "Purchase Notice") to each Holder of record stating: (1) that a Change of Control has occurred or may occur and that such Holder has, or upon such occurrence will have, the right (subject to the Debt Agreements (including the availability of funds by dividend from NAVL in compliance therewith), and to the legal availability of funds therefor) to require the Company to purchase any or all shares of such Holder's Junior Preferred Stock at a purchase price per share in cash equal to 101% of the Liquidation Preference thereof on the relevant Purchase Date, plus, without duplication, an amount in cash equal to all accumulated and unpaid dividends, if any, with respect to such share; (2) the circumstances and relevant facts and financial information regarding such Change of Control; (3) the date fixed for such purchase (which shall be no earlier than 30 days nor later than 60 days from the date such notice is mailed); (4) the instructions determined by the Company, consistent with this paragraph (h), that a Holder must follow in order to have its shares of Junior Preferred Stock purchased; and (5) if such notice is mailed prior to the occurrence of a Change of Control, that such Offer is conditioned on the occurrence of such Change of Control.

        (ii)   Holders of Junior Preferred Stock electing to have shares of Junior Preferred Stock purchased shall be required to surrender the certificate or certificates representing such shares of Junior Preferred Stock, duly endorsed, to the Company in the manner and at the address specified in the Purchase Notice at least three Business Days prior to the date fixed for such purchase. On the Purchase Date, the Change of Control Purchase Price for such shares shall become payable in cash to the Person whose name appears on such certificate or certificates as the owner thereof. In

the event that less than all of the shares represented by any such certificate are purchased, a new certificate shall be issued representing the shares not purchased.

        (iii)  If the funds of the Company legally available for any purchase of shares of Junior Preferred Stock under this paragraph (h) on any Purchase Date are insufficient to purchase the total number of shares of Junior Preferred Stock to be purchased on such date or if a complete purchase is not permitted by any Debt Agreement (or any Debt Agreement does not permit NAVL to dividend sufficient legally available funds to the Company to effect a complete purchase), those funds which are legally available shall be used to purchase the maximum possible number of shares of the Holders to the extent permitted by each Debt Agreement and to the extent NAVL is permitted to dividend an equal amount of funds to the Company under each Debt Agreement out of funds legally available therefor. At any time thereafter when additional funds of the Company are legally available for the purchase of shares, such funds shall immediately be used to purchase the balance of the shares of Junior Preferred Stock which the Company has become obligated to purchase on any Purchase Date but which it has not purchased, to the extent permitted by each Debt Agreement and to the extent NAVL is permitted to dividend an equal amount of funds to the Company under each Debt Agreement out of funds legally available therefor.

        (iv)  Unless the Company defaults in the payment in full of the applicable Change of Control Purchase Price, dividends on the Junior Preferred Stock tendered for purchase shall cease to accumulate on the date fixed for such purchase, and the Holders of such shares shall cease to have any further rights with respect thereto on the such date, other than the right to receive the Change of Control Purchase Price without interest.

        (v)   The Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the purchase of Junior Preferred Stock pursuant to this paragraph (h). To the extent that the provisions of any securities laws or regulations conflict with provisions of this paragraph (h), the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this paragraph (h) by virtue thereof.

        (vi)  Notwithstanding any other provision of this paragraph (h), the Company shall not be required to purchase any shares of Junior Preferred Stock under this paragraph (h), (A) unless NAVL is required to purchase or repay the outstanding Notes and Senior Discount Notes pursuant to the Indentures and has offered to purchase or repay in full all of the outstanding Notes and Senior Discount Notes and has so purchased or repaid in full all of the outstanding Notes and Senior Discount Notes of each holder of any Note or Senior Discount Note who has accepted such offer and (B) unless the principal of and all accrued and unpaid interest on all indebtedness under the Senior Credit Facility, and all other monetary obligations owing in respect of the Senior Credit Facility, shall have been paid in full, and all letters of credit, bankers acceptances and similar instruments outstanding thereunder shall have expired undrawn.

        (i)    Conversion or Exchange.

        The Holders of shares of Junior Preferred Stock shall not have any rights hereunder to convert such shares into or exchange such shares for shares of any other class or classes or of any other series of any class or classes of Capital Stock of the Company.

        (j)    Preemptive Rights.

        No shares of Junior Preferred Stock shall have any rights of preemption whatsoever as to any securities of the Company, or any warrants, rights or options issued or granted with respect thereto, regardless of how such securities or such warrants, rights or options may be designated, issued or granted.

        (k)    Business Day.

        If any payment, redemption or exchange would be required by the terms hereof to be made on a day that is not a Business Day, such payment, redemption or exchange shall be made (and deemed required to be made) on the immediately succeeding Business Day.

        (l)    Certain Additional Provisions.

        (i)    Merger or Consolidation.    (A) Without the consent of the Holders of a majority of the outstanding shares of Junior Preferred Stock, the Company will not consolidate with or merge with or into, or convey, transfer or lease all or substantially all its assets to, any Person, unless: (1) the resulting, surviving or transferee Person (the "Successor Company") will be a Person organized and existing under the laws of the United States of America, any State thereof or the District of Columbia; (2) if the Successor Company is not the Company, the Junior Preferred Stock shall be converted into or exchanged for and shall become Capital Stock of the Successor Company ("Successor Company Stock") having, in respect of such Successor Company, substantially the same preferences and relative participating, optional or other special rights, and qualifications, limitations or restrictions thereon, as applied to the Junior Preferred Stock immediately prior to such transaction; (3) immediately after giving effect to such transaction (and treating any Indebtedness that becomes an obligation of the Successor Company or any Restricted Subsidiary as a result of such transaction as having been Incurred by the Successor Company or such Restricted Subsidiary at the time of such transaction) no Mandatory Redemption Event will have occurred and be continuing; and (4) the Company will have obtained an Officer's Certificate and an Opinion of Counsel, each to the effect that such consolidation, merger or transfer complies with this paragraph (l)(i)(A), provided that (x) in giving such opinion such counsel may rely on an Officer's Certificate as to compliance with the foregoing clauses (2) and (3) and as to any matters of fact, and (y) no Opinion of Counsel will be required for a consolidation, merger or transfer described in paragraph (l)(i)(B) below. Any Indebtedness that becomes an obligation of the Company or any Restricted Subsidiary (or that is deemed to be Incurred by any Restricted Subsidiary that becomes a Restricted Subsidiary) as a result of any such transaction undertaken in compliance with this paragraph (l)(i), and any Refinancing Indebtedness with respect thereto, shall be deemed to have been Incurred in compliance with paragraph (l)(iii).

        (B)  Any merger, consolidation, conveyance, transfer or lease by the Company in compliance with this paragraph (l)(i) shall not be subject to the provisions of paragraph (d) above.

        (C)  Paragraph (l)(i)(A) above shall not apply to any transaction in which (1) any Restricted Subsidiary consolidates with, merges into or transfers all or part of its assets to the Company or (2) the Company consolidates or merges with or into or transfers all or substantially all its properties and assets to (x) an Affiliate incorporated or organized for the purpose of reincorporating or reorganizing the Company in another jurisdiction or changing its legal structure to a corporation or other entity or (y) a Restricted Subsidiary of the Company so long as all assets of the Company and the Restricted Subsidiaries immediately prior to such transaction (other than Capital Stock of such Restricted Subsidiary) are owned by such Restricted Subsidiary and its Restricted Subsidiaries immediately after the consummation thereof.

        (D)  Notwithstanding any other provision of this Certificate of Designation, each of the Company and any Successor Company shall have the right and power, without the consent or any act of any Holder, to amend or cancel this Certificate of Designation or take any other action necessary (as determined by the Company or such Successor Company in good faith) to effect any conversion or exchange of the Junior Preferred Stock contemplated by paragraph (l)(i)(A)(2) above. Without limiting the foregoing:

        (1)   In the event the Company or such Successor Company has effected or intends to effect such a conversion or exchange (a "Conversion Event"), it will send a written notice (the "Conversion Notice") by mail to each Holder of record, provided that no failure to give such notice nor any deficiency therein shall affect the validity of the procedure for the conversion

or exchange of any shares of Junior Preferred Stock to be converted or exchanged except as to the Holder or Holders to whom the Company has failed to give such notice or except as to the Holder or Holders whose notice was defective. The Conversion Notice shall state: (x) that a Conversion Event has occurred or that the Company or a Successor Company intends to effect a Conversion Event; (y) that the Holder is to surrender to the Company or the Successor Company the certificate or certificates representing the shares of Junior Preferred Stock to be converted or exchanged, the place or places where such certificate or certificates are to be surrendered and the manner in which such certificate or certificates are to be surrendered; and (z) that upon surrender of the certificate or certificates representing the shares of Junior Preferred Stock to be converted or exchanged in the manner designated in the Conversion Notice, the Holder shall be entitled to receive from the Successor Company a certificate or certificates representing shares of Successor Company Stock thereof.

        (2)   Each Holder of Junior Preferred Stock shall surrender the certificate or certificates representing such shares of Junior Preferred Stock, at the place and in the manner designated in the Conversion Notice, promptly upon its receipt of the Conversion Notice and in no event later than 30 days following the date on which the Conversion Notice is mailed. On the date that is 30 days following the date on which the Conversion Notice is mailed and provided that the Holder has surrendered the certificate of certificates representing the shares of Junior Preferred Stock, the Holder shall be entitled to receive from the Successor Company a certificate or certificates representing shares of Successor Company Stock thereof in accordance with the Conversion Notice.

        (3)   On the date on which the merger, consolidation, conveyance, transfer or lease transaction giving rise to the Conversion Event occurs (the "Conversion Date"), and provided that all shares of Successor Company Stock necessary to effect the Conversion Event have been duly issued by the Successor Company in the respective names of the Holders of record as at such date that are entitled thereto, then dividends shall cease to accrue on the outstanding shares of Junior Preferred Stock and all of the rights of the Holders of shares of the Junior Preferred Stock as stockholders of the Company shall cease, and the Person or Persons entitled to receive the Successor Company Stock issuable on the Conversion Date shall be treated for all purposes as the registered holder or holders of such Successor Company Stock as of the Conversion Date.

        (ii)    Junior Payments.    (A) Without the consent of the Holders of a majority of the outstanding shares of Junior Preferred Stock, the Company shall not, and shall not permit any Restricted Subsidiary, directly or indirectly, to (i) declare or pay any dividend or make any distribution on or in respect of any Junior Securities of the Company, including any such payment in connection with any merger or consolidation to which the Company is a party, except (x) dividends or distributions payable solely in its Capital Stock (other than Disqualified Stock) and (y) dividends or distributions payable to the Company or any Restricted Subsidiary, or (ii) purchase, redeem, retire or otherwise acquire for value, prior to scheduled maturity, scheduled repayment or scheduled sinking fund payment, any Junior Securities of the Company held by Persons other than the Company or any Restricted Subsidiary (other than a purchase, redemption, retirement, or other acquisition for value in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of such acquisition) (any such dividend, distribution, purchase, redemption, retirement or other acquisition being herein referred to as a "Junior Payment"), if at the time the Company or such Restricted Subsidiary makes such Junior Payment:

        (1)   a Mandatory Redemption Event shall have occurred and be continuing (or would result therefrom);

        (2)   NAVL could not incur at least an additional $1.00 of Indebtedness pursuant to paragraph (l)(iii)(A) below; or

        (3)   the aggregate amount of such Junior Payment and all other Junior Payments (the amount so expended, if other than in cash, to be as determined in good faith by the Board, whose determination shall be conclusive) declared or made subsequent to the Issue Date and then outstanding would exceed the sum of:

        (a)   50% of the Consolidated Net Income of the Company or (if greater) of NAVL accrued during the period (treated as one accounting period) from September 30, 1999 to the end of the most recent fiscal quarter ending prior to the date of such Junior Payment for which consolidated financial statements of the Company or NAVL, as the case may be, are available (or, in case each such Consolidated Net Income shall be a negative number, 100% of the smaller such negative number); and

        (b)   the aggregate Net Cash Proceeds and the fair market value of Qualified Proceeds received (x) by the Company as capital contributions to the Company after the Issue Date or from the issuance or sale (other than to a Restricted Subsidiary) of its Capital Stock (other than Disqualified Stock) after the Issue Date or (y) by the Company or any Restricted Subsidiary from the issuance and sale by the Company or any Restricted Subsidiary after the Issue Date of Indebtedness that shall have been converted into or exchanged for Capital Stock of the Company (other than Disqualified Stock), plus the amount of cash and the fair market value of Qualified Proceeds received by the Company or any Restricted Subsidiary upon such conversion or exchange.

        (B)  The provisions of the foregoing paragraph (l)(ii)(A) will not prohibit any of the following (each, a "Permitted Payment"):

        (1)   any purchase, redemption, retirement or other acquisition of Capital Stock of the Company made by exchange (including any such exchange pursuant to the exercise of a conversion right or privilege in connection with which cash is paid in lieu of the issuance of fractional shares) for, or conversion into, or out of the proceeds of the substantially concurrent issuance or sale of, Capital Stock of the Company (other than Disqualified Stock and other than Capital Stock issued or sold to a Subsidiary) or out of the proceeds of a substantially concurrent capital contribution to the Company; provided, that the Net Cash Proceeds from such issuance, sale or capital contribution shall be excluded in subsequent calculations under clause (3)(b) of the preceding paragraph (l)(ii)(A);

        (2)   any purchase, redemption, retirement or other acquisition of Junior Securities (x) made by exchange for, or out of the proceeds of the substantially concurrent issuance or sale of, Refinancing Indebtedness Incurred in compliance with paragraph (l)(iii) below or (y) to the extent required by the agreement governing such Junior Securities following the occurrence of a Change of Control, but only if in each case, the Company shall have complied with paragraph (h) above and, if required, purchased all shares of Junior Preferred Stock tendered pursuant to an Offer to purchase such shares required thereby, prior to purchasing or repaying such Junior Securities;

        (3)   dividends paid within 60 days after the date of declaration thereof if at such date of declaration such dividend would have complied with the preceding paragraph (l)(ii)(A);

        (4)   payments to repurchase or otherwise acquire Capital Stock (including any options, warrants or other rights in respect thereof), in each case from Management Investors, such payments not to exceed an amount (net of repayments of any such loans or advances equal to (a) $12.5 million plus (b) $2.5 million multiplied by the number of calendar years that have commenced since the Issue Date plus (c) the Net Cash Proceeds received by the Company or NAVL since the Issue Date from, or as a capital contribution from, the issuance or sale of Capital Stock (including any options, warrants or other rights in respect thereof), to the extent such Net Cash Proceeds are not included in any calculation under clause (3)(b)(x) of the preceding paragraph (l)(ii)(A);

        (5)   the payment of dividends on the common stock or equity of the Company following a public offering of such common stock or equity, in an amount not to exceed in any fiscal year 6% of the aggregate gross proceeds received by the Company in or from such public offering;

        (6)   Junior Payments (including loans or advances) in an aggregate amount outstanding at any time not to exceed $10.0 million (net of repayments of any such loans or advances);

        (7)   payments to satisfy obligations under the Management Agreements to pay any Holding Expenses;

        (8)   payments to holders of Capital Stock of the Company in lieu of issuance of fractional shares of such Capital Stock, not to exceed $100,000 in the aggregate outstanding at any time;

        (9)   the distribution, as a dividend or otherwise, of Investments in Unrestricted Subsidiaries;

        (10) the Transactions;

        (11) any purchase, redemption, retirement or other acquisition of Capital Stock that may be deemed to occur upon exercise of stock options, warrants or similar rights to the extent such Capital Stock represents all or part of the exercise price thereof; and

        (12) Junior Payments by any Restricted Subsidiary that are permitted by the Senior Credit Facility or any Indenture;

provided, that (A) in the case of clauses (3) and (5), the net amount of any such Permitted Payment shall be included in subsequent calculations of the amount of Junior Payments, (B) in the case of clause (4), 50% of the amount of any such Permitted Payment shall be included in subsequent calculations of the amount of Junior Payments, (C) in the case of clause (12), the net amount of any such Permitted Payment shall be included in subsequent calculations of the amount of Junior Payments to the extent that such net amount is required under each Indenture to be included in concurrent calculations of the amount of Restricted Payments (as defined in such Indenture) under Section 4.08 of the Note Indenture, Section 4.08 of the Senior Discount Note Indenture and Section 6.7 of the Senior Discount Loan Agreement, (D) in all cases other than pursuant to clauses (A), (B) and (C) immediately above, the net amount of any such Permitted Payment shall be excluded in subsequent calculations of the amount of Junior Payments and (E) with respect to clauses (5) and (6), no Mandatory Redemption Event shall have occurred or be continuing at the time of any such Permitted Payment after giving effect thereto.

        (iii)    Limitation on Indebtedness.    (A) Without the consent of the Holders of a majority of the outstanding shares of Junior Preferred Stock, the Company will not, and will not permit any Restricted Subsidiary to, Incur any Indebtedness; provided, however, that (1) the Company or any Restricted Subsidiary may Incur Indebtedness if on the date of the Incurrence of such Indebtedness, after giving effect to the Incurrence thereof, the Consolidated Coverage Ratio of the Company would be greater than 1.75:1.00 if such Indebtedness is Incurred on or prior to December 1, 2001 or 2.00:1.00 if such Indebtedness is Incurred thereafter and (2) NAVL or any Note Guarantor may Incur Indebtedness if on the date of the Incurrence of such Indebtedness, after giving effect to the Incurrence thereof, the Consolidated Coverage Ratio of NAVL would be greater than 2.00:1.00 if such Indebtedness is Incurred on or prior to December 1, 2001 or 2.25:1.00 if such Indebtedness is Incurred thereafter.

        (B)  Notwithstanding the foregoing paragraph (l)(iii)(A), the Company and its Restricted Subsidiaries may Incur the following Indebtedness:

        (1)   Indebtedness Incurred pursuant to Credit Facilities (including but not limited to in respect of letters of credit or bankers' acceptances issued or created thereunder) and (without limiting the foregoing) any Refinancing Indebtedness in respect thereof, in a maximum principal amount at any time outstanding (giving effect to any refinancing thereof) not

exceeding in the aggregate the amount equal to the sum of (x) $475.0 million and (y) the aggregate amount by which the Borrowing Base determined as of the date of such Incurrence exceeds $245.0 million (plus in the case of any refinancing of any Credit Facility or any portion thereof, the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing);

        (2)   Indebtedness (a) of any Restricted Subsidiary to the Company or (b) of the Company or any Restricted Subsidiary to any Restricted Subsidiary; provided, that any subsequent issuance or transfer of any Capital Stock of such Restricted Subsidiary to which such Indebtedness is owed, or other event, that results in such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of such Indebtedness (except to the Company or a Restricted Subsidiary) will be deemed, in each case, an Incurrence of such Indebtedness by the issuer thereof;

        (3)   Indebtedness represented by the Exchange Debentures, the Notes and the Senior Discount Notes (other than Additional Notes), any Indebtedness (other than the Indebtedness described in clauses (1) or (2) above) outstanding on the Issue Date and any Refinancing Indebtedness Incurred in respect of any Indebtedness described in this clause (3) or paragraph (l)(iii)(A) above;

        (4)   Purchase Money Obligations and Capitalized Lease Obligations, and any Refinancing Indebtedness with respect thereto, in an aggregate principal amount at any time outstanding (giving effect to any refinancing thereof) not exceeding an amount equal to the greater of (x) $35.0 million and (y) 5% of Consolidated Tangible Assets;

        (5)   Indebtedness of any Person that is assumed by the Company or any Restricted Subsidiary in connection with its acquisition of assets from such Person or any Affiliate thereof or is issued and outstanding on or prior to the date on which such Person was acquired by the Company or any Restricted Subsidiary or merged or consolidated with or into any Restricted Subsidiary (other than Indebtedness Incurred to finance, or otherwise in connection with, such acquisition), provided that on the date of such acquisition, merger or consolidation, after giving effect thereto, NAVL could Incur at least $1.00 of additional Indebtedness pursuant to paragraph (l)(iii)(A) above; and any Refinancing Indebtedness with respect to any such Indebtedness;

        (6)   (a) Guarantees by the Company or any Restricted Subsidiary of Indebtedness or any other obligation or liability of the Company or any Restricted Subsidiary (other than any Indebtedness incurred by the Company or such Restricted Subsidiary, as the case may be, in violation of this paragraph (l)(iii)), or (b) Indebtedness of the Company or any Restricted Subsidiary arising by reason of any Lien granted by or applicable to such Person securing Indebtedness of the Company or any Restricted Subsidiary (other than any Indebtedness incurred by the Company or such Restricted Subsidiary, as the case may be, in violation of this paragraph (l)(iii));

        (7)   Indebtedness of the Company or any Restricted Subsidiary (a) arising from the honoring of a check, draft or similar instrument of such Person drawn against insufficient funds, provided that such Indebtedness is extinguished within five Business Days of its incurrence, or (b) consisting of guarantees, indemnities, obligations in respect of earnouts or other purchase price adjustments, or similar obligations, Incurred in connection with the acquisition or disposition of any business, assets or Person (including pursuant to the Allied Acquisition);

        (8)   Indebtedness of the Company or any Restricted Subsidiary in respect of (a) letters of credit, bankers' acceptances or other similar instruments or obligations issued, or relating to liabilities or obligations incurred, in the ordinary course of business (including those issued to governmental entities in connection with self-insurance under applicable workers' compensation statutes), or (b) completion guarantees, surety, judgment, appeal or

performance bonds, or other similar bonds, instruments or obligations, provided, or relating to liabilities or obligations incurred, in the ordinary course of business, or (c) Hedging Obligations entered into for bona fide hedging purposes in the ordinary course of business, (d) Management Guarantees, (e) Agent Guarantees in an aggregate principal amount not exceeding $10.0 million outstanding at any time, or (f) the financing of insurance premiums in the ordinary course of business;

        (9)   Indebtedness of a Receivables Subsidiary secured by a Lien on all or part of the assets disposed of in, or otherwise incurred in connection with, a Financing Disposition, which Indebtedness is, except for Standard Receivables Obligations, otherwise without recourse to NAVL or any Restricted Subsidiary (other than any Receivables Subsidiary);

        (10) Indebtedness of a Foreign Subsidiary of the Company or NAVL if, on the date of Incurrence of such Indebtedness, after giving effect to the Incurrence thereof, (x) the Consolidated Coverage Ratio of the Company or NAVL would be at least 2.25:1.00 and (y) if, as a result of such Incurrence, such Foreign Subsidiary shall then become subject to any restriction or limitation (under any agreement or instrument governing such Indebtedness) on its ability to pay dividends or make other distributions to NAVL, the Foreign Subsidiary Coverage Ratio of the Company or NAVL would be greater than 2.75:1.00; provided, that if such Indebtedness is not incurred pursuant to the preceding clause (y), such Indebtedness shall not be amended, modified or otherwise supplemented such that such Foreign Subsidiary will become subject to any such restriction or limitation referred to in such clause unless such Indebtedness could then be Incurred pursuant to such clause; and any Refinancing Indebtedness with respect to any such Indebtedness;

        (11) Indebtedness of the Company or any Restricted Subsidiary in an aggregate principal amount at any time outstanding (giving effect to any refinancing thereof) not exceeding an amount equal to $95.0 million;

        (12) Indebtedness of any Restricted Subsidiary that is permitted to be Incurred under the Senior Credit Facility or any Indenture; and

        (13) Indebtedness under the Interim Loan Facility, in an aggregate principal amount not to exceed $40.0 million outstanding at any time.

        (C)  For purposes of determining compliance with, and the outstanding principal amount of any particular Indebtedness Incurred pursuant to and in compliance with, this covenant, (i) any other obligation of the obligor on such Indebtedness (or of any other Person who could have Incurred such Indebtedness under this covenant) arising under any Guarantee, Lien or letter of credit, bankers' acceptance or other similar instrument or obligation supporting such Indebtedness shall be disregarded to the extent that such Guarantee, Lien or letter of credit, bankers' acceptance or other similar instrument or obligation secures the principal amount of such Indebtedness; (ii) in the event that Indebtedness meets the criteria of more than one of the types of Indebtedness described in paragraph (l)(iii)(B) above, the Company, in its sole discretion, shall classify such item of Indebtedness and only be required to include the amount and type of such Indebtedness in one of such clauses; and (iii) the amount of Indebtedness issued at a price that is less than the principal amount thereof shall be equal to the amount of the liability in respect thereof determined in accordance with GAAP.

        (D)  For purposes of determining compliance with any Dollar-denominated restriction on the Incurrence of Indebtedness denominated in a foreign currency, the Dollar-equivalent principal amount of such Indebtedness Incurred pursuant thereto shall be calculated based on the relevant currency exchange rate in effect on the date that such Indebtedness was Incurred, in the case of term Indebtedness, or first committed, in the case of revolving credit Indebtedness, provided that (x) the Dollar-equivalent principal amount of any such Indebtedness outstanding on the Issue Date shall be calculated based on the relevant currency exchange rate in effect on the Issue Date, (y) if such Indebtedness is Incurred to refinance other Indebtedness denominated in a foreign currency,

and such refinancing would cause the applicable Dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such Dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced and (z) the Dollar-equivalent principal amount of Indebtedness denominated in a foreign currency and Incurred pursuant to the Senior Credit Facility shall be calculated based on the relevant currency exchange rate in effect on, at the Company's option, (i) the Issue Date, (ii) any date on which any of the respective commitments under the Senior Credit Facility shall be reallocated between or among facilities or subfacilities thereunder, or on which such rate is otherwise calculated for any purpose thereunder, or (iii) the date of such Incurrence. The principal amount of any Indebtedness Incurred to refinance other Indebtedness, if Incurred in a different currency from the Indebtedness being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such respective Indebtedness is denominated that is in effect on the date of such refinancing.

        (iv)    Withholding.    Notwithstanding any other provision of this Certificate of Designation, in the event that the Company makes any tax payment in respect of any share of Junior Preferred Stock (including but not limited to any withholding tax payment made by the Company under Chapter 3 of Subtitle A of the Code):

        (A)  if the tax payment is in respect of a cash distribution made on such share, the amount of such cash distribution paid to the Holder of such share shall be reduced by the amount of such tax payment, provided that for all purposes hereof the Holder of such share shall be treated as having received the amount of such tax payment as part of such cash distribution and as having paid over such tax payment to the taxing authority to which it was paid; and

        (B)  if the tax payment is not in respect of a cash distribution made on such share (or exceeds a cash distribution made on such share), the Liquidation Preference of such share as of the time of such tax payment shall be reduced by the amount of such tax payment (or the amount of such excess) through an increase (without duplication) in the Adjustment Amount.

        If and to the extent that a Holder of any share of Junior Preferred Stock remits cash to the Company for the specified purpose of funding a tax payment to be made by the Company in respect of such share, and such cash is received by the Company prior to the time that the Company makes such tax payment, then such tax payment shall be disregarded for purposes of the preceding sentence. If requested by any Holder of any share of Junior Preferred Stock, the Company shall consult in good faith with such Holder concerning the Company's obligations to make any tax payments in respect of such share.

        (v)    Register.    The Company shall keep a register of the Holder of each share of Junior Preferred Stock and the Adjustment Amount (if any) with respect to each such share.

        (m)    Restrictions on Transfer.

        (i)    Restriction.    Unless a Redemption Notice has been given by the Company, the Junior Preferred Stock shall not be Transferred, directly or indirectly, by any Holder (other than by or to the Company or a Subsidiary thereof) (x) unless the minimum number of shares to be Transferred shall be at least 10,000 and (y) except as provided in this paragraph (m). Notwithstanding the foregoing, the restrictions set forth in paragraph (m) (v) below shall not apply in the case of a Transfer by the Holder to a direct or indirect Subsidiary of NFC that remains such a Subsidiary.

        (ii)    Restrictive Legend.    Except as otherwise permitted by this paragraph (m), each certificate for Junior Preferred Stock shall be registered in the stock register of the Company and be stamped or otherwise imprinted with a legend in substantially the following form:

"EACH SHARE OF JUNIOR PREFERRED STOCK MAY HAVE ITS OWN LIQUIDATION PREFERENCE AND STATED AMOUNT, WHICH MAY BE

SIGNIFICANTLY GREATER OR LESS THAN OTHER SHARES. ABSENT MANIFEST ERROR, THE AMOUNT OF LIQUIDATION PREFERENCE SET FORTH IN THE STOCK REGISTER FOR EACH NUMBERED SHARE SHALL BE CONCLUSIVE. PROSPECTIVE TRANSFEREES SHOULD REFER TO THE STOCK REGISTER TO DETERMINE THE LIQUIDATION PREFERENCE OF ANY SHARES THAT THEY MAY BE RECEIVING."

"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TRANSFER RESTRICTIONS SET FORTH IN THE CERTIFICATE OF DESIGNATION OF THE JUNIOR EXCHANGEABLE PREFERRED STOCK OF THE COMPANY FILED WITH THE SECRETARY OF STATE OF THE STATE OF DELAWARE AND NEITHER THIS CERTIFICATE NOR THE SHARES REPRESENTED BY IT ARE ASSIGNABLE OR OTHERWISE TRANSFERABLE EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF SUCH CERTIFICATE OF DESIGNATION, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF SIRVA, INC.."

"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE OR FOREIGN SECURITIES LAWS AND MAY NOT BE TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) (A) SUCH DISPOSITION IS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, (B) THE HOLDER HEREOF SHALL HAVE DELIVERED TO SIRVA, INC. AN OPINION OF COUNSEL, WHICH OPINION AND COUNSEL SHALL BE REASONABLY SATISFACTORY TO SIRVA, INC., TO THE EFFECT THAT SUCH DISPOSITION IS EXEMPT FROM THE PROVISIONS OF SECTION 5 OF SUCH ACT OR (C) A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION, REASONABLY SATISFACTORY TO COUNSEL FOR SIRVA, INC., SHALL HAVE BEEN OBTAINED WITH RESPECT TO SUCH DISPOSITION AND (ii) SUCH DISPOSITION IS PURSUANT TO REGISTRATION UNDER ANY APPLICABLE STATE OR FOREIGN SECURITIES LAWS OR AN EXEMPTION THEREFROM."

"ANY TRANSFEREE OF THE SHARES REPRESENTED BY THIS CERTIFICATE (EITHER OF THE ORIGINAL HOLDER OF THE SHARES OR ANY TRANSFEREE OF SUCH HOLDER) BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT ("RULE 144A")) AND (2) AGREES FOR THE BENEFIT OF THE COMPANY THAT THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED OR DISPOSED OF ONLY (I) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (III) TO THE COMPANY, IN EACH OF CASES (I) THROUGH (III) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND SUBJECT TO THE COMPANY'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS CERTIFICATE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE COMPANY. THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE SHARES REPRESENTED BY THIS CERTIFICATE FROM IT OF THE RESALE RESTRICTION REFERRED TO ABOVE."

        (iii)    Notice of Proposed Transfer.    Subject to the rights of the Company under paragraphs (m)(iv) and (m)(v), prior to any Transfer of any shares of Junior Preferred Stock that are not

registered under an effective registration statement under the Securities Act, the Holder of such shares of Junior Preferred Stock shall give written notice (a "Transfer Notice") to the Company of such Holder's intention to effect such Transfer by completing the form of Transfer Notice attached hereto as Annex B, the text of which will appear on the reverse side of the certificate evidencing shares of Junior Preferred Stock. Each certificate for Junior Preferred Stock, if any, issued upon or in connection with such Transfer shall bear the appropriate restrictive legend set forth in paragraph (m)(ii), unless, in the opinion of counsel to the Company, such legend is no longer required to ensure compliance with the Securities Act.

        (iv)    [Intentionally Omitted]    

        (v)    Company Consent.    Notwithstanding any other provision of this Certificate of Designation (other than the second sentence of paragraph (m)(i)), no Transfer of the shares of Preferred Stock will be permitted, and the Company shall have no obligation to record any such Transfer, unless the Company shall have consented to the Transfer in writing, such consent not to be unreasonably withheld, provided that (A) for the avoidance of doubt the Company may take into account the withholding taxes (if any) that would be applicable in respect of the proposed transferee and (B) this paragraph (m)(v) shall not apply in the case of a Transfer of shares of Junior Preferred Stock with respect to which a Redemption Notice has been delivered and is currently in effect.

        (n)    Definitions.

        (1)    Rules of Construction.    For all purposes of this Certificate of Designation, except as otherwise expressly provided or unless the context otherwise requires:

        (A)  the terms defined in this Certificate of Designation have the meanings assigned to them in this Certificate of Designation;

        (B)  "or" is not exclusive;

        (C)  all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP;

        (D)  the words "herein," "hereof" and "hereunder" and other words of similar import refer to this Certificate of Designation as a whole and not to any particular paragraph or other subdivision;

        (E)  all references to "$" or "dollars" shall refer to the lawful currency of the United States of America;

        (F)  the words "include," "included" and "including" as used herein shall be deemed in each case to be followed by the phrase "without limitation," if not expressly followed by such phrase or the phrase "but not limited to"; and

        (G)  any reference to a paragraph refers to the specified paragraph of the Certificate of Designation.

        (2)    Specific Definitions.    As used in this Certificate of Designation, the following terms shall have the following meanings (with terms defined in the singular having comparable meanings when used in the plural and vice versa), unless the context otherwise requires:

        "Additional Notes" has the meaning specified in the applicable Indenture.

        "Adjustment Amount" means, with respect to any share of Junior Preferred Stock at any time, the sum of (i) the aggregate amount of the reductions made with respect to such share pursuant to paragraph (l)(iv)(B) and (ii) an amount, as of any time, equal to the quotient of (A) an aggregate amount equal to, for each year until and including the fifth anniversary of the Issue Date, one half of the excess of (x) all interest paid or accrued (whether or not paid) on the Notes (excluding any Additional Notes), the Senior Discount Notes and $25.0 million aggregate principal amount of borrowings under the Tranche B Term Loan Facility (as such

term is defined in the Senior Credit Facility) as of such time over (y) all interest that would have been paid or accrued as of such time on debt securities in an aggregate principal amount of $210 million (the "Base Amount") with the same final Stated Maturity as the Notes and bearing interest at 12% per annum, with semi-annual interest payments (based on a 360-day year consisting of twelve 30-day months) and no principal payment due prior to such final Stated Maturity divided by (B) the total number of outstanding shares of Junior Preferred Stock, provided that the aggregate amount determined under this clause (ii) for any year with respect to all outstanding shares of Junior Preferred Stock shall not exceed $2.5 million (the "Annual Cap"). In the event, prior to the fifth anniversary, of (a) an optional redemption of any Notes or Senior Discount Notes or (b) an optional prepayment of up to $25 million in aggregate principal amount of the Tranche B Term Loan (any such redemption or prepayment, a "Redemption Amount"), (1) the Base Amount shall be reduced by the Redemption Amount and (2) the Annual Cap shall thereafter be equal to the difference between (X) $2.5 million and (Y) an amount equal to $2.5 million multiplied by a fraction, the numerator of which is the Redemption Amount and the denominator of which is the Base Amount.

        "Affiliate" of any specified Person means any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, "control" when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing.

        "Agent" means any moving or storage company or contractor, or other Person, that provides sales, packing, warehousing, hauling or other services in connection with the ordinary course of business or operations of the Company or any of its Subsidiaries, or any Affiliate of any such Agent.

        "Agent Guarantee" means any Guarantee by the Company, NAVL or any Restricted Subsidiary of Indebtedness or other obligations of any Agent.

        "all or substantially all" has the meaning given to such phrase in the Revised Model Business Corporation Act and commentary thereto.

        "Allied Acquisition" means the acquisition of Capital Stock and/or assets of certain Subsidiaries of NFC engaged in moving services businesses pursuant to the Acquisition Agreement dated as of September 14, 1999 between the Company and NFC, and the other transactions contemplated thereby.

        "Average Life" means, as of the date of determination, with respect to any Indebtedness or Preferred Stock, the quotient obtained by dividing (i) the sum of the products of the numbers of years from the date of determination to the dates of each successive scheduled principal payment of such Indebtedness or redemption or similar payment with respect to such Preferred Stock multiplied by the amount of such payment by (ii) the sum of all such payments.

        "Bank Indebtedness" means any and all amounts, whether outstanding on the Issue Date or thereafter incurred, payable under or in respect of the Senior Credit Facility, including without limitation principal, premium (if any), interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company or any Restricted Subsidiary whether or not a claim for post-filing interest is allowed in such proceedings), fees, charges, expenses, reimbursement obligations, guarantees, other monetary obligations of any nature and all other amounts payable thereunder or in respect thereof.

        "Board" means the Board of Directors of the Company or NAVL, or any committee thereof duly authorized to act on behalf of such Board.

        "Board of Directors" has the meaning specified in the first paragraph of this Certificate of Designation.

        "Borrowing Base" means 85% of accounts receivables of NAVL and its Restricted Subsidiaries (determined in accordance with GAAP as of the end of the most recently ended fiscal quarter for which consolidated financial statements of NAVL are available).

        "Business Day" means any day other than a Saturday, Sunday or other day on which commercial banking institutions are authorized or required by law to close in New York City.

        "Capitalized Lease Obligation" means an obligation that is required to be classified and accounted for as a capitalized lease for financial reporting purposes in accordance with GAAP. The Stated Maturity of any Capitalized Lease Obligation shall be the date of the last payment of rent or any other amount due under the related lease.

        "Capital Stock" of any Person means any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such Person, including any Preferred Stock, but excluding any debt securities convertible into such equity.

        "CD&R" means Clayton, Dubilier & Rice, Inc.

        "CD&R Fund" means Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands exempted limited partnership (together with any successor investment vehicle managed by CD&R).

        "Change of Control" means:

        (A)  a Change of Control Triggering Event (as defined in the Indentures) has occurred and is continuing (without waiver under the respective Indenture); and

        (B)  (1) any "person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, is or becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the total voting power of the Voting Stock of the Company;

        (2)   the Company sells or transfers (in one or a series of related transactions) all or substantially all of the assets of the Company and its Restricted Subsidiaries to another Person (other than one or more Permitted Holders or the Company or one or more Subsidiaries thereof); or

        (3)   during any period of two consecutive years (during which period the Junior Preferred Stock shall have been outstanding), individuals who at the beginning of such period were members of the Board of Directors (together with any new members thereof whose election by the Board of Directors or whose nomination for election by holders of Capital Stock of the Company was approved by one or more Permitted Holders or by a vote of a majority of the members of the Board of Directors then still in office who were either members thereof at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office.

        "Change of Control Default" has the meaning specified in the definition of "Mandatory Redemption Event" below.

        "Change of Control Purchase Price" has the meaning specified in paragraph (h)(i).

        "Code" means the Internal Revenue Code of 1986, as amended.

        "Commission" means the Securities and Exchange Commission.

        "Common Stock" has the meaning specified in paragraph (b).

        "Company" has the meaning specified in the first paragraph of this Certificate of Designation.

        "Consolidated Coverage Ratio" of the Company or NAVL, respectively, as of any date of determination means the ratio of (i) the aggregate amount of Consolidated EBITDA of such Parent for the period of the most recent four consecutive fiscal quarters ending prior to the date of such determination for which consolidated financial statements of such Parent are available to (ii) Consolidated Interest Expense of such Parent for such four fiscal quarters (in each case, determined, for each fiscal quarter (or portion thereof) of the four fiscal quarters ending prior to the Issue Date, on a pro forma basis to give effect to the Allied Acquisition as if it had occurred at the beginning of such four-quarter period); provided, that:

        (1)   if since the beginning of such period, such Parent or any Restricted Subsidiary of such Parent has Incurred any Indebtedness that remains outstanding on such date of determination or if the transaction giving rise to the need to calculate the Consolidated Coverage Ratio is an Incurrence of Indebtedness, Consolidated EBITDA and Consolidated Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Indebtedness as if such Indebtedness had been Incurred on the first day of such period (except that in making such computation, the amount of Indebtedness under any revolving credit facility outstanding on the date of such calculation shall be computed based on (A) the average daily balance of such Indebtedness during such four fiscal quarters or such shorter period for which such facility was outstanding or (B) if such facility was created after the end of such four fiscal quarters, the average daily balance of such Indebtedness during the period from the date of creation of such facility to the date of such calculation),

        (2)   if since the beginning of such period, such Parent or any Restricted Subsidiary of such Parent has repaid, repurchased, redeemed, defeased or otherwise acquired, retired or discharged any Indebtedness (each, a "Discharge") or if the transaction giving rise to the need to calculate the Consolidated Coverage Ratio involves a Discharge of Indebtedness (in each case other than Indebtedness Incurred under any revolving credit facility unless such Indebtedness has been permanently repaid), Consolidated EBITDA and Consolidated Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Discharge of such Indebtedness, including with the proceeds of such new Indebtedness, as if such Discharge had occurred on the first day of such period,

        (3)   if since the beginning of such period, such Parent or any Restricted Subsidiary of such Parent shall have disposed of any company, any business or any group of assets constituting an operating unit of a business (any such disposition, a "Sale"), the Consolidated EBITDA for such period shall be reduced by an amount equal to the Consolidated EBITDA (if positive) attributable to the assets that are the subject of such Sale for such period or increased by an amount equal to the Consolidated EBITDA (if negative) attributable thereto for such period and Consolidated Interest Expense for such period shall be reduced by an amount equal to (A) the Consolidated Interest Expense attributable to any Indebtedness of such Parent or any Restricted Subsidiary of such Parent repaid, repurchased, redeemed, defeased or otherwise acquired, retired or discharged with respect to such Parent and its continuing Restricted Subsidiaries in connection with such Sale for such period (including but not limited to through the assumption of such Indebtedness by another Person) plus (B) if the Capital Stock of any Restricted Subsidiary of such Parent is sold, the Consolidated Interest Expense for such period attributable to the Indebtedness of such Restricted Subsidiary to the extent such Parent and its continuing Restricted Subsidiaries are no longer liable for such Indebtedness after such Sale,

        (4)   if since the beginning of such period, such Parent or any Restricted Subsidiary of such Parent (by merger, consolidation or otherwise) shall have made an Investment in any Person that thereby becomes a Restricted Subsidiary of such Parent, or otherwise acquired any company, any business or any group of assets constituting an operating unit of a business, including any such Investment or acquisition occurring in connection with a transaction causing a calculation to be made hereunder (any such Investment or acquisition, a "Purchase"), Consolidated EBITDA and Consolidated Interest Expense for such period shall be calculated after giving pro forma effect thereto (including the Incurrence of any related Indebtedness) as if such Purchase occurred on the first day of such period, and

        (5)   if since the beginning of such period, any Person became a Restricted Subsidiary of such Parent or was merged or consolidated with or into of such Parent or any Restricted Subsidiary of such Parent, and since the beginning of such period such Person shall have Discharged any Indebtedness or made any Sale or Purchase that would have required an adjustment pursuant to clause (2), (3) or (4) above if made by such Parent or a Restricted Subsidiary of such Parent during such period, Consolidated EBITDA and Consolidated Interest Expense for such period shall be calculated after giving pro forma effect thereto as if such Discharge, Sale or Purchase occurred on the first day of such period.

        For purposes of this definition, whenever pro forma effect is to be given to any Sale, Purchase or other transaction, or the amount of income or earnings relating thereto and the amount of Consolidated Interest Expense associated with any Indebtedness Incurred or repaid, repurchased, redeemed, defeased or otherwise acquired, retired or discharged in connection therewith, the pro forma calculations in respect thereof may include anticipated cost savings relating to any such Sale, Purchase or other transaction that the Company or NAVL reasonably believes in good faith could have been achieved during the relevant four quarter period as a result of such Sale, Purchase or other transaction (provided that both (i) such cost savings were identified and quantified in an Officer's Certificate at the time of the consummation of such transaction and (ii) with respect to each such transaction completed prior to the 90th day preceding the relevant date of determination, actions were commenced or initiated by the Company or NAVL within 90 days of the consummation of such transaction to effect such cost savings identified in such Officer's Certificate and with respect to any other transaction, such Officer's Certificate sets forth the specific steps to be taken within the 90 days after the consummation of such transaction to accomplish such cost savings). If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest expense on such Indebtedness shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account any Interest Rate Agreement applicable to such Indebtedness). If any Indebtedness bears, at the option of the Company or a Restricted Subsidiary, a rate of interest based on a prime or similar rate, a eurocurrency interbank offered rate or other fixed or floating rate, and such Indebtedness is being given pro forma effect, the interest expense on such Indebtedness shall be calculated by applying such optional rate as the Company or such Restricted Subsidiary may designate. If any Indebtedness that is being given pro forma effect was Incurred under a revolving credit facility, the interest expense on such Indebtedness shall be computed based upon the average daily balance of such Indebtedness during the applicable period. Interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate determined in good faith by a responsible financial or accounting officer of the Company or NAVL to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with GAAP.

        "Consolidated EBITDA" of the Company or NAVL, respectively, means, for any period, the Consolidated Net Income of such Parent for such period, plus the following to the extent deducted in calculating such Consolidated Net Income: (i) provision for all taxes (whether or not paid, estimated or accrued) based on income, profits or capital, (ii) Consolidated Interest Expense, (iii) depreciation, amortization (including but not limited to amortization of goodwill and intangibles and amortization and write-off of financing costs) and all other non-cash charges or non-cash losses, (iv) any expenses or charges related to any Equity Offering, Investment or Indebtedness permitted by this Certificate of Designation (whether or not consummated or incurred) and (v) the amount of any minority interest expense. To the extent Consolidated EBITDA of such Parent would otherwise include the amount of any Receivables Fees excluded from Consolidated Interest Expense of such Parent pursuant to clause (iii) of the definition of Consolidated Interest Expense, Consolidated EBITDA of such Parent shall be reduced by such amount.

        "Consolidated Interest Expense" of the Company or NAVL, respectively, means, for any period, (i) the total interest expense of such Parent and its Restricted Subsidiaries to the extent deducted in calculating Consolidated Net Income of such Parent, net of any interest income of such Parent and its Restricted Subsidiaries, including without limitation any such interest expense consisting of (a) interest expense attributable to Capitalized Lease Obligations, (b) amortization of debt discount, (c) interest in respect of Indebtedness of any other Person that has been Guaranteed by such Parent or any Restricted Subsidiary of such Parent (other than Indebtedness Guaranteed under any Management Guarantee or Agent Guarantee, except to the extent the interest thereon is actually being paid by such Parent or a Restricted Subsidiary thereof), (d) non-cash interest expense, (e) the interest portion of any deferred payment obligation, and (f) commissions, discounts and other fees and charges owed with respect to letters of credit and bankers' acceptance financing, plus (ii) dividends paid in cash in respect of Disqualified Stock of such Parent or a Restricted Subsidiary of such Parent or in respect of Preferred Stock of a Restricted Subsidiary of such Parent and minus (iii) to the extent otherwise included in such interest expense referred to in clause (i) above, Receivables Fees and amortization or write-off of financing costs, in each case under clauses (i) through (iii) as determined on a Consolidated basis in accordance with GAAP; provided, that gross interest expense shall be determined after giving effect to any net payments made or received by such Parent and its Restricted Subsidiaries with respect to Interest Rate Agreements.

        "Consolidated Net Income" of the Company or NAVL, respectively, means, for any period, the net income (loss) of such Parent and its Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP and before any reduction in respect of Preferred Stock dividends (including dividends in respect of any Junior Preferred Stock); provided, that there shall not be included in such Consolidated Net Income:

        (i)    any net income (loss) of any Person if such Person is not a Restricted Subsidiary of such Parent, except that (A) subject to the limitations contained in clause (iv) below, such Parent's equity in the net income of any such Person for such period shall be included in such Consolidated Net Income up to the aggregate amount actually distributed by such Person during such period to such Parent or a Restricted Subsidiary of such Parent as a dividend or other distribution (subject, in the case of a dividend or other distribution to a Restricted Subsidiary of such Parent, to the limitations contained in clause (iii) below) and (B) such Parent's equity in the net loss of such Person shall be included to the extent of the aggregate Investment of such Parent or any of its Restricted Subsidiaries in such Person,

        (ii)   any net income (loss) of any Person acquired by such Parent or a Restricted Subsidiary of such Parent in a pooling of interests transaction for any period prior to the date of such acquisition,

        (iii)  any net income (loss) of any Restricted Subsidiary of NAVL if such Restricted Subsidiary is subject to restrictions, directly or indirectly, on the payment of dividends or the making of similar distributions by such Restricted Subsidiary, directly or indirectly, to NAVL by operation of the terms of such Restricted Subsidiary's charter or any agreement, instrument, judgment, decree, order, statute or governmental rule or regulation applicable to such Restricted Subsidiary or its stockholders (other than (x) restrictions that have been waived or otherwise released, (y) restrictions pursuant to this Certificate of Designation, the Notes, the Senior Discount Notes or any Indenture and (z) restrictions in effect on the Issue Date with respect to a Restricted Subsidiary and other restrictions with respect to such Restricted Subsidiary that taken as a whole are not materially less favorable to the Noteholders than such restrictions in effect on the Issue Date), except that (A) subject to the limitations contained in clause (iv) below, NAVL's equity in the net income of any such Restricted Subsidiary for such period shall be included in such Consolidated Net Income up to the aggregate amount of any dividend or distribution that was or that could have been made by such Restricted Subsidiary during such period to NAVL or another Restricted Subsidiary of NAVL (subject, in the case of a dividend that could have been made to another Restricted Subsidiary of NAVL, to the limitation contained in this clause) and (B) the net loss of such Restricted Subsidiary shall be included to the extent of the aggregate Investment of NAVL or any of its other Restricted Subsidiaries in such Restricted Subsidiary,

        (iv)  any gain or loss realized upon the sale or other disposition of any asset of such Parent or any Restricted Subsidiary of such Parent (including pursuant to any sale/leaseback transaction) that is not sold or otherwise disposed of in the ordinary course of business (as determined in good faith by the Board),

        (v)   any item classified as an extraordinary, unusual or nonrecurring gain, loss or charge (including without limitation (a) any compensation expense for stock options that will be cashed out, converted, exchanged or otherwise retired in connection with the Allied Acquisition, (b) any charge or expense incurred for employee bonuses in connection with the Allied Acquisition, and (c) fees, expenses and charges associated with the Allied Acquisition or any acquisition, merger or consolidation after the Issue Date),

        (vi)  the cumulative effect of a change in accounting principles,

        (vii) all deferred financing costs written off and premiums paid in connection with any early extinguishment of Indebtedness,

        (viii) any unrealized gains or losses in respect of Currency Agreements,

        (ix)  any unrealized foreign currency transaction gains or losses in respect of Indebtedness of any Person denominated in a currency other than the functional currency of such Person, and

        (x)   any non-cash compensation charge arising from any grant of stock, stock options or other equity based awards.

        In the case of any unusual or nonrecurring gain, loss or charge not included in Consolidated Net Income pursuant to clause (v) above in any determination thereof, the Company or NAVL will prepare an Officer's Certificate promptly after the date on which Consolidated Net Income is so determined, setting forth the nature and amount of such unusual or nonrecurring gain, loss or charge.

        "Consolidated Tangible Assets" means, as of any date of determination, the total assets less the total intangible assets (including, without limitation, goodwill) shown on the consolidated balance sheet of NAVL and its Restricted Subsidiaries as of the most recent date for which such a balance sheet is available, determined on a consolidated basis in accordance

with GAAP (and, in the case of any determination related to any Incurrence of Indebtedness, on a pro forma basis including any property or assets being acquired in connection therewith).

        "Consolidation" means for the Company or NAVL, respectively, the consolidation of the accounts of each of the Restricted Subsidiaries of such Parent with those of such Parent in accordance with GAAP; provided that "Consolidation" will not include consolidation of the accounts of any Unrestricted Subsidiary of such Parent, but the interest of such Parent or any Restricted Subsidiary of such Parent in any Unrestricted Subsidiary of such Parent will be accounted for as an investment. The term "Consolidated" has a correlative meaning.

        "Conversion Date" has the meaning specified in paragraph (l)(i)(D)(3).

        "Conversion Event" has the meaning specified in paragraph (l)(i)(D)(1).

        "Conversion Notice" has the meaning specified in paragraph (l)(i)(D)(1).

        "Credit Facilities" means, one or more of (x) the Senior Credit Facility and (y) other facilities or arrangements, in each case with one or more banks or other institutions providing for revolving credit loans, term loans, receivables financings (including without limitation through the sale of receivables to such institutions or to special purpose entities formed to borrow from such institutions against such receivables), letters of credit or other Indebtedness, in each case, including all agreements, instruments and documents executed and delivered pursuant to or in connection with any of the foregoing, in each case as the same may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, whether with the original banks or other institutions or other banks or other institutions or otherwise, and whether provided under any original Credit Facility or one or more other credit agreements, indentures, financing agreements or other Credit Facilities or otherwise). Without limiting the generality of the foregoing, the term "Credit Facility" shall include any agreement (i) changing the maturity of any Indebtedness incurred thereunder or contemplated thereby, (ii) adding Subsidiaries of the Company as additional borrowers or guarantors thereunder, (iii) increasing the amount of Indebtedness incurred thereunder or available to be borrowed thereunder or (iv) otherwise altering the terms and conditions thereof.

        "Currency Agreement" means, in respect of a Person, any foreign exchange contract, currency swap agreement or other similar agreement or arrangements (including derivative agreements or arrangements), as to which such Person is a party or a beneficiary.

        "Debt Agreements" means the Senior Credit Facility, the Indentures, the Notes and the Senior Discount Notes, and any refinancing thereof, provided that any agreement governing any such refinancing shall not be a Debt Agreement to the extent that it imposes greater restrictions on the payment of cash dividends on, or the mandatory redemption or purchase of, the Junior Preferred Stock than the Debt Agreement thereby refinanced.

        "Default Amount" means (i) $0 for any date during the period beginning on the Issue Date and ending on the date before the first Dividend Payment Date falling on or after the 63-month anniversary of the Issue Date and (ii) as of any other date, the lesser of (A) the aggregate amount of dividends actually permitted under the Debt Agreements to have been declared and paid by the Company on the Junior Preferred Stock on each Dividend Payment Date that occurs during the period beginning on the first Dividend Payment Date falling on or after the 63-month anniversary of the Issue Date and ending on such date, (B) the aggregate amount of dividends actually permitted under the Debt Agreements to have been declared and paid by NAVL to the Company on each such Dividend Payment Date for the purpose of paying dividends on the Junior Preferred Stock on such respective Dividend Payment Date and (C) the sum of the Minimum Amounts applicable to each Dividend Payment Date that occurs during the period beginning on the first Dividend Payment Date falling on or after the 63-month anniversary of the Issue Date and ending on such date.

        "Default Rate" means a quarterly rate equal to (i) 1.50% in the case of each Dividend Payment Date occurring during the one-year period beginning on the first Dividend Payment Date falling on or after the 63-month anniversary of the Issue Date and (ii) 1.75% in the case of each Dividend Payment Date falling on or after the 75-month anniversary of the Issue Date.

        "Disqualified Stock" means, with respect to any Person, any Capital Stock (other than Management Stock) that by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable or exercisable) or upon the happening of any event (i) matures or is mandatorily redeemable pursuant to a sinking fund obligation or otherwise, (ii) is convertible or exchangeable for Indebtedness or Disqualified Stock or (iii) is redeemable at the option of the holder thereof, in whole or in part, in each case on or prior to the 91st day following the final Stated Maturity of the Notes. Notwithstanding the preceding sentence, (a) any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require the Company or NAVL to repurchase such Capital Stock upon the occurrence of an event described therein as a change of control or an asset sale shall not constitute Disqualified Stock if the terms of such Capital Stock provide that the Company or NAVL may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with paragraph (l)(ii) above, (b) any Capital Stock that would constitute Disqualified Stock solely because such Capital Stock is issued pursuant to any plan for the benefit of employees and may be required to be repurchased by the Company or NAVL in order to satisfy applicable regulatory obligations shall not constitute Disqualified Stock and (c) the Junior Preferred Stock shall not constitute Disqualified Stock.

        "Dividend Default" means the failure of the Company to have declared and paid dividends on the Junior Preferred Stock as of any date (other than any date as of which the Default Amount is $0) in an amount at least equal to the Default Amount as of such date.

        "Dividend Payment Date" means March 15, June 15, September 15 and December 15 of each year.

        "Dividend Period" means the Initial Dividend Period and, thereafter, each Quarterly Dividend Period.

        "Domestic Subsidiary" of the Company or NAVL, respectively, means any Restricted Subsidiary of such Parent other than a Foreign Subsidiary of such Parent.

        "Equity Offering" means a sale of Capital Stock (other than Disqualified Stock) of the Company or NAVL (x) that is a sale of Capital Stock of the Company or NAVL or (y) proceeds of which are contributed to the Company or any of its Restricted Subsidiaries.

        "Exchange Act" means the Securities Exchange Act of 1934, as amended.

        "Exchange Date" has the meaning specified in paragraph (g)(i)(A).

        "Exchange Debentures" means the Subordinated Exchange Debentures of the Company due 2010 and any Exchange Debentures issued as payment in kind interest thereon.

        "Exchange Notice" has the meaning specified in paragraph (g)(i)(A).

        "Financing Disposition" means any sale, transfer, conveyance or other disposition of property or assets by the Company or any Subsidiary thereof to any Receivables Entity, or by any Receivables Subsidiary, in each case in connection with the Incurrence by a Receivables Entity of Indebtedness, or obligations to make payments to the obligor on Indebtedness, which may be secured by a Lien in respect of such property or assets.

        "Foreign Subsidiary" of the Company or NAVL, respectively, means (a) any Restricted Subsidiary of such Parent that is not organized under the laws of the United States of America or any state thereof or the District of Columbia and (b) any Restricted Subsidiary of

such Parent that has no material assets other than securities of one or more Foreign Subsidiaries, and other assets relating to an ownership interest in any such securities or Subsidiaries.

        "Foreign Subsidiary Coverage Ratio" of the Company or NAVL, respectively, as of any date of determination means the ratio of (i) the combined portion attributable to Foreign Subsidiaries of such Parent, taken as a whole, of the aggregate amount of Consolidated EBITDA of such Parent for the period of the most recent four consecutive fiscal quarters ending prior to the date of such determination for which consolidated financial statements of such Parent are available to (ii) the combined portion attributable to Foreign Subsidiaries of such Parent, taken as a whole, of Consolidated Interest Expense of such Parent for such four fiscal quarters, all calculated after giving effect to all intercompany eliminations applied in preparing the relevant consolidated financial statements of such Parent (and without giving effect to clause (iii) of the definition of the term Consolidated Net Income as it relates to restrictions on the payment of dividends or the making of similar distributions by any Foreign Subsidiary to NAVL or any Domestic Subsidiary of NAVL, but giving effect to such clause as it relates to any such restrictions on the payment of dividends or the making of similar distributions by any Foreign Subsidiary of NAVL to another Foreign Subsidiary of NAVL), and otherwise in accordance with the definition of the term "Coverage Ratio" (including but not limited to in accordance with all pro forma and other adjustments provided for in such definition).

        "GAAP" means generally accepted accounting principles in the United States of America as in effect on the Issue Date (for purposes of the definitions of the terms "Consolidated Coverage Ratio," "Foreign Subsidiary Coverage Ratio," "Consolidated EBITDA," "Consolidated Interest Expense," "Consolidated Net Income" and "Consolidated Tangible Assets," all defined terms in this Certificate of Designation to the extent used in or relating to any of the foregoing definitions, and all ratios and computations based on any of the foregoing definitions) and as in effect from time to time (for all other purposes under this Certificate of Designation), including those set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as approved by a significant segment of the accounting profession. All ratios and computations based on GAAP contained in this Certificate of Designation shall be computed in conformity with GAAP.

        "Guarantee" means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness or other obligation of any other Person; provided that the term "Guarantee" shall not include endorsements for collection or deposit in the ordinary course of business. The term "Guarantee" used as a verb has a corresponding meaning.

        "Hedging Obligations" of any Person means the obligations of such Person pursuant to any Interest Rate Agreement or Currency Agreement.

        "Holder" means a holder of shares of Junior Preferred Stock in whose name the certificate representing such shares is registered in the stock register of the Company.

        "Holding Expenses" means (i) costs (including all professional fees and expenses) incurred by the Company to comply with its reporting obligations under federal or state laws or under any Indenture, including any reports filed with respect to the Securities Act, Exchange Act or the respective rules and regulations promulgated thereunder, (ii) indemnification obligations of the Company owing to directors, officers, employees or other Persons under its charter or by-laws or pursuant to written agreements with any such Person, (iii) fees and expenses payable by the Company in connection with the Transactions, (iv) other operational expenses of the Company incurred in the ordinary course of business,

and (v) expenses incurred by the Company in connection with any public offering of Capital Stock or Indebtedness.

        "Incur" means issue, assume, enter into any Guarantee of, incur or otherwise become liable for; provided, however, that any Indebtedness or Capital Stock of a Person existing at the time such Person becomes a Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Subsidiary at the time it becomes a Subsidiary. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an Incurrence of Indebtedness. Any Indebtedness issued at a discount (including Indebtedness on which interest is payable through the issuance of additional Indebtedness) shall be deemed Incurred at the time of original issuance of the Indebtedness at the initial accreted amount thereof.

        "Indebtedness" means, with respect to any Person on any date of determination (without duplication):

        (i)    the principal of indebtedness of such Person for borrowed money,

        (ii)   the principal of obligations of such Person evidenced by bonds, debentures, notes or other similar instruments,

        (iii)  all reimbursement obligations of such Person in respect of letters of credit or other similar instruments (the amount of such obligations being equal at any time to the aggregate then undrawn and unexpired amount of such letters of credit or other instruments plus the aggregate amount of drawings thereunder that have not then been reimbursed),

        (iv)  all obligations of such Person to pay the deferred and unpaid purchase price of property (except Trade Payables), which purchase price is due more than one year after the date of placing such property in final service or taking final delivery and title thereto,

        (v)   all Capitalized Lease Obligations of such Person,

        (vi)  the redemption, repayment or other repurchase amount of such Person with respect to any Disqualified Stock of such Person or (if such Person is a Subsidiary of NAVL other than a Note Guarantor) any Preferred Stock of such Subsidiary, but excluding, in each case, any accrued dividends (the amount of such obligation to be equal at any time to the maximum fixed involuntary redemption, repayment or repurchase price for such Capital Stock, or if less (or if such Capital Stock has no such fixed price), to the involuntary redemption, repayment or repurchase price therefor calculated in accordance with the terms thereof as if then redeemed, repaid or repurchased, and if such price is based upon or measured by the fair market value of such Capital Stock, such fair market value shall be as determined in good faith by the Board or the board of directors or other governing body of the issuer of such Capital Stock),

        (vii) all Indebtedness of other Persons secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; provided that the amount of Indebtedness of such Person shall be the lesser of (A) the fair market value of such asset at such date of determination (as determined good faith by the Company) and (B) the amount of such Indebtedness of such other Persons,

        (viii) Guarantees of all Indebtedness of other Persons to the extent so Guaranteed by such Person, and

        (ix)  to the extent not otherwise included in this definition, net Hedging Obligations of such Person (the amount of any such obligation to be equal at any time to the termination value of such agreement or arrangement giving rise to such Hedging Obligation that would be payable by such Person at such time).

        The amount of Indebtedness of any Person at any date shall be determined as set forth above or otherwise provided in paragraph (l), or otherwise shall equal the amount thereof that would appear on a balance sheet of such Person (excluding any notes thereto) prepared in accordance with GAAP. The Junior Preferred Stock shall not constitute Indebtedness.

        "Indentures" mean the Note Indenture, the Senior Discount Note Indenture and the Senior Discount Loan Agreement.

        "Initial Dividend Period" means the dividend period commencing on the Issue Date and ending on the day before the first Dividend Payment Date to occur thereafter.

        "Interest Rate Agreement" means, with respect to any Person, any interest rate protection agreement, interest rate future agreement, interest rate option agreement, interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedge agreement or other similar agreement or arrangement (including derivative agreements or arrangements), as to which such Person is party or a beneficiary.

        "Interim Loan Facility" means the loan agreement dated as of the Issue Date among the Company, The Chase Manhattan Bank and Bank of America (or affiliates of such institutions), together with any notes, guarantees, pledge agreements, security agreements, other collateral documents, and other agreements, instruments and documents, executed and delivered pursuant to or in connection with any of the foregoing, in each case as the same may be amended, supplemented, waived or otherwise modified from time to time.

        "Inventory" means goods held for sale or lease by a Person in the ordinary course of business, net of any reserve for goods that have been segregated by such Person to be returned to the applicable vendor for credit, as determined in accordance with GAAP.

        "Investment" in any Person by any other Person means any direct or indirect advance, loan or other extension of credit (other than to customers, suppliers, Agents, directors, officers or employees of any Person in the ordinary course of business) or capital contribution (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others) to, or any purchase or acquisition of Capital Stock, Indebtedness or other similar instruments issued by, such Person. A Guarantee shall not be deemed to be or give rise to an Investment until such Guarantee is funded (in whole or in part). The amount of any Investment outstanding at any time shall be the original cost of such Investment, reduced (at the Company's option) by any dividend, distribution, interest payment, return of capital, repayment or other amount or value received in respect of such Investment.

        "Issue Date" means the date on which the Junior Preferred Stock is originally issued by the Company under this Certificate of Designation.

        "Junior Payment" has the meaning specified in paragraph (l)(ii)(A).

        "Junior Preferred Stock" has the meaning specified in paragraph (a).

        "Junior Securities" has the meaning specified in paragraph (b)(i).

        "Lien" means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof).

        "Liquidation Preference" has the meaning specified in paragraph (a).

        "Management Advances" means (1) loans or advances made to directors, officers or employees of the Company or any Restricted Subsidiary (x) in respect of travel, entertainment or moving-related expenses incurred in the ordinary course of business, (y) in respect of moving-related expenses incurred in connection with any closing or consolidation of any facility, or (z) in the ordinary course of business and (in the case of this clause (z)) not exceeding $2.5 million in the aggregate outstanding at any time, (2) promissory notes of

Management Investors acquired in connection with the issuance of Management Stock to such Management Investors, (3) loans to Management Investors of funds applied to purchase Management Stock in an aggregate principal amount not exceeding $10.0 million outstanding at any time (less the aggregate principal amount of then outstanding borrowings by Management Investors then guaranteed by the Company or NAVL pursuant to clause (x) of the definition of Management Guarantees), (4) Management Guarantees, or (5) other Guarantees of borrowings by Management Investors in connection with the purchase of Management Stock, which Guarantees are permitted under paragraph (l)(iii).

        "Management Agreements" means, collectively, the Consulting Agreement, dated as of March 30, 1998, among the Company, NAVL and CD&R (and, in each case, its respective permitted successors and assigns thereunder) and the Indemnification Agreement, dated as of March 30, 1998, among the Company, NAVL, CD&R and Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands exempted limited Partnership (and, in each case, its respective permitted successors and assigns), as each may be amended, supplemented, waived or otherwise modified from time to time in accordance with the terms thereof.

        "Management Guarantees" means guarantees (x) of up to an aggregate principal amount of $10.0 million of borrowings by Management Investors in connection with their purchase of Management Stock outstanding at any time (less the aggregate principal amount of then outstanding loans made to Management Investors by the Company or NAVL pursuant to clause (3) of the definition of Management Advances) or (y) made on behalf of, or in respect of loans or advances made to, directors, officers or employees of the Company or any Restricted Subsidiary (1) in respect of travel, entertainment and moving-related expenses incurred in the ordinary course of business, or (2) in the ordinary course of business and (in the case of this clause (2)) not exceeding $2.5 million in the aggregate outstanding at any time.

        "Management Investors" means the officers, directors, employees and other members of the management of the Company, NAVL or any of their respective Subsidiaries (or of any Agent), or family members or relatives thereof, or trusts or partnerships for the benefit of any of the foregoing, or any of their heirs, executors, successors and legal representatives, or any Agent, who at any date beneficially own or have the right to acquire, directly or indirectly, Capital Stock of the Company or NAVL.

        "Management Stock" means Capital Stock of the Company or NAVL (including any options, warrants or other rights in respect thereof) held by any of the Management Investors.

        "Mandatory Redemption Event" has occurred if (1) there is a Dividend Default for four consecutive quarterly periods; (2) the Company is permitted by the Debt Agreements but fails to discharge any redemption obligation of the Junior Preferred Stock when required, and NAVL is permitted by the Debt Agreements to dividend sufficient funds to the Company for such purpose; (3) the Company is permitted by the Debt Agreements but fails to make an Offer to purchase all outstanding shares of Junior Preferred Stock following a Change of Control if such Offer to purchase is required to be made pursuant to paragraph (h) hereof or fails to purchase shares of Junior Preferred Stock when required from Holders who elect to have such shares purchased pursuant to such Offer (a "Change of Control Default"), and in each case NAVL is permitted by the Debt Agreements to dividend sufficient funds to the Company for the purpose of purchasing all such outstanding shares or all such shares of electing Holders, as the case may be; or (4) the Company breaches or violates one of the provisions set forth in paragraph (l) hereof and the breach or violation continues for a period of 60 days or more after the Company receives notice thereof specifying the default from the Holders of at least 25% of the shares of Junior Preferred Stock then outstanding and there has been an acceleration of the maturity of the outstanding indebtedness under any Debt Agreements.

        "Mandatory Redemption Price" has the meaning specified in paragraph (e)(ii).

        "Minimum Amount" means, with respect to any Dividend Payment Date, an amount equal to the product of the Default Rate with respect to such date and the aggregate Stated Amounts as of such date of each share of Junior Preferred Stock.

        "Moody's" means Moody's Investors Service, Inc., and its successors.

        "NAVL" means North American Van Lines, Inc., a Delaware corporation, and any successor thereto.

        "Net Cash Proceeds," with respect to any issuance or sale of any securities of the Company or any Subsidiary by the Company or any Subsidiary, or any capital contribution, means the cash proceeds of such issuance, sale or contribution net of attorneys' fees, accountants' fees, underwriters' or placement agents' fees, discounts or commissions and brokerage, consultant and other fees actually incurred in connection with such issuance, sale or contribution and net of taxes paid or payable as a result thereof.

        "NFC" means NFC plc, a company organized under the laws of England and Wales.

        "Note Guarantor" means any Restricted Subsidiary that enters into a Guarantee of any Notes.

        "Noteholder" means the Person in whose name a Note is registered in the applicable Note register of the Company.

        "Notes" means the 13³/8% Senior Subordinated Notes of NAVL due 2009 issued under the Note Indenture, in an aggregate principal amount of $150.0 million, any Exchange Notes (as defined in the Note Indenture) and any Additional Notes.

        "Note Indenture" means the Indenture, dated as of the Issue Date, between NAVL and State Street Bank and Trust Company, as Trustee, pursuant to which Notes are issued, as such Indenture may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, and whether provided under the original Note Indenture or one or more other credit agreements, indentures or financing agreements or otherwise).

        "Offer" has the meaning specified in paragraph (h)(i).

        "Officer" means, with respect to the Company or NAVL, the Chairman of the Board, the President, the Chief Executive Officer, the Chief Financial Officer, any Vice President, the Controller, the Treasurer or the Secretary (a) of such Person or (b) if such Person is owned or managed by a single entity, of such entity (or any other individual designated as an "Officer" for the purposes of this Certificate of Designation by the Board).

        "Officer's Certificate" means a certificate signed by one Officer of the Company or NAVL.

        "Opinion of Counsel" means a written opinion from Debevoise & Plimpton, or other legal counsel who is reasonably acceptable to the Holders of a majority of the outstanding shares of the Junior Preferred Stock. The counsel may be an employee of or counsel to the Company or NAVL.

        "Optional Redemption Price" has the meaning specified in paragraph (e)(i)(A).

        "Parent" means the Company or NAVL, as the case may be.

        "Parity Securities" has the meaning specified in paragraph (b)(ii).

        "Permitted Holder" means any of the following: (i) any of CD&R Fund, the Management Investors, CD&R and their respective Affiliates; (ii) any investment fund or vehicle managed, sponsored or advised by CD&R and (iii) any Person acting in the capacity of an underwriter in connection with a public or private offering of Capital Stock of the Company or NAVL.

        "Person" means any individual, corporation, partnership, joint venture, association, joint-stock company, limited liability company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

        "Preferred Stock" as applied to the Capital Stock of any corporation means Capital Stock of any class or classes (however designated) that is preferred as to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such corporation, over shares of Capital Stock of any other class of such corporation.

        "Public Offering" any underwritten public offering of Common Stock led by one or more underwriters at least one of which is of nationally recognized standing pursuant to an effective registration statement under the Securities Act.

        "Purchase Date" with respect to any shares of Junior Preferred Stock, means the date on which such shares of Junior Preferred Stock are purchased by the Company as contemplated by paragraph (h) above.

        "Purchase Money Obligations" means any Indebtedness Incurred to finance or refinance the acquisition, leasing, construction or improvement of property (real or personal) or assets, and whether acquired through the direct acquisition of such property or assets or the acquisition of the Capital Stock of any Person owning such property or assets, or otherwise.

        "Purchase Notice" has the meaning specified in paragraph (h)(i).

        "QIB" or "Qualified Institutional Buyer" means a "qualified institutional buyer," as that term is defined in Rule 144A under the Securities Act of 1933, as amended.

        "Quarterly Dividend Period" shall mean the quarterly period commencing on each March 15, June 15, September 15 and December 15 and ending on the day before the following Dividend Payment Date.

        "Qualified Proceeds" means property or assets that are used, usable or useful in, or a majority of the Voting Stock of any Person engaged in, a Related Business; provided that the fair market value of any such assets or Capital Stock shall be determined by the Board in good faith.

        "Receivable" means a right to receive payment arising from a sale or lease of goods or services by a Person pursuant to an arrangement with another Person pursuant to which such other Person is obligated to pay for goods or services under terms that permit the purchase of such goods and services on credit, as determined in accordance with GAAP.

        "Receivables Entity" means (x) any Receivables Subsidiary or (y) any other Person that is engaged in the business of acquiring, selling, collecting, financing or refinancing Receivables, accounts (as defined in the Uniform Commercial Code as in effect in any jurisdiction from time to time), other accounts and/or other receivables, and/or related assets.

        "Receivables Fees" means distributions or payments made directly or by means of discounts with respect to any participation interest issued or sold in connection with, and other fees paid to a Person that is not a Restricted Subsidiary of NAVL in connection with, any Receivables Financing.

        "Receivables Financing" means any financing of Receivables of the Company or any Restricted Subsidiary that have been transferred to a Receivables Entity in a Financing Disposition.

        "Receivables Subsidiary" means a Subsidiary of the Company that (a) is engaged solely in the business of acquiring, selling, collecting, financing or refinancing Receivables, accounts (as defined in the Uniform Commercial Code as in effect in any jurisdiction from time to time) and other accounts and receivables (including any thereof constituting or evidenced by chattel paper, instruments or general intangibles), all proceeds thereof and all rights (contractual and

other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and (b) is designated as a "Receivables Subsidiary" by the Board.

        "Receivables Repurchase Obligation" means any obligation of a seller of receivables to repurchase receivables (including Receivables, accounts (as defined in the Uniform Commercial Code as in effect in any jurisdiction from time to time) and other accounts and receivables (including any thereof constituting or evidenced by chattel paper, instruments or general intangibles)) arising as a result of a breach of a representation, warranty or covenant or otherwise, including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, off-set or counterclaim of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller.

        "Redemption Date" with respect to any shares of Junior Preferred Stock, means the date on which such shares of Junior Preferred Stock are redeemed by the Company.

        "Redemption Notice" has the meaning specified in paragraph (e)(iii).

        "refinance" means refinance, refund, replace, renew, repay, modify, restate, defer, substitute, supplement, reissue, resell or extend (including pursuant to any defeasance or discharge mechanism); and the terms "refinances," "refinanced" and "refinancing" as used for any purpose in this Certificate of Designation shall have a correlative meaning.

        "Refinancing Indebtedness" means Indebtedness that is Incurred to refinance any Indebtedness existing on the Issue Date or Incurred in compliance with this Certificate of Designation (including Indebtedness of the Company that refinances Indebtedness of any Restricted Subsidiary (to the extent permitted in this Certificate of Designation) and Indebtedness of any Restricted Subsidiary that refinances Indebtedness of another Restricted Subsidiary) including Indebtedness that refinances Refinancing Indebtedness; provided, that (1) if, the Indebtedness being refinanced is Junior Securities, the Refinancing Indebtedness has an Average Life at the time such Refinancing Indebtedness is Incurred that is equal to or greater than the Average Life of the Indebtedness being refinanced, (2) such Refinancing Indebtedness is Incurred in an aggregate principal amount (or if issued with original issue discount, an aggregate issue price) that is equal to or less than the sum of (x) the aggregate principal amount (or if issued with original issue discount, the aggregate accreted value) then outstanding of the Indebtedness being refinanced, plus (y) fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such Refinancing Indebtedness and (3) Refinancing Indebtedness shall not include Indebtedness of the Company or a Restricted Subsidiary that refinances Indebtedness of an Unrestricted Subsidiary.

        "Related Business" means those businesses in which the Company or any of its Subsidiaries is engaged on the Issue Date, or that are related, complementary, incidental or ancillary thereto or extensions, developments or expansions thereof.

        "Resolution" has the meaning specified in the recitals.

        "Restricted Subsidiary" means any Subsidiary of the Company (or in the case of NAVL, of NAVL) other than an Unrestricted Subsidiary of such Parent.

        "Securities Act" means the Securities Act of 1933, as amended.

        "Senior Credit Agreement" means the credit agreement dated as of the Issue Date, 1999, among NAVL, any other Subsidiaries of the Company party thereto from time to time, the banks and other financial institutions party thereto from time to time, Banc of America Securities LLC, as syndication agent, and The Chase Manhattan Bank as collateral agent and administrative agent, as such agreement may be assumed by any successor in interest, and as such agreement may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, whether with the original agent and lenders

or other agents and lenders or otherwise, and whether provided under the original Senior Credit Agreement or otherwise).

        "Senior Credit Facility" means the collective reference to the Senior Credit Agreement, any Loan Documents (as defined therein), any notes and letters of credit issued pursuant thereto and any guarantee and collateral agreement, patent and trademark security agreement, mortgages, letter of credit applications and other guarantees, pledge agreements, security agreements and collateral documents, and other instruments and documents, executed and delivered pursuant to or in connection with any of the foregoing, in each case as the same may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, whether with the original agent and lenders or other agents and lenders or otherwise, and whether provided under the original Senior Credit Agreement or one or more other credit agreements, indentures (including the Indenture) or financing agreements or otherwise). Without limiting the generality of the foregoing, the term "Senior Credit Facility" shall include any agreement (i) changing the maturity of any Indebtedness incurred thereunder or contemplated thereby, (ii) adding Subsidiaries of the Company as additional borrowers or guarantors thereunder, (iii) increasing the amount of Indebtedness incurred thereunder or available to be borrowed thereunder or (iv) otherwise altering the terms and conditions thereof.

        "Senior Discount Notes" means (1) the Indebtedness of the Company under the Senior Discount Loan Agreement, with an initial accreted value of $35.0 million in the aggregate, and (2) the 16% Senior Discount Notes of the Company due 2009 issued or to be issued under the Senior Discount Note Indenture, in exchange or substitution for Indebtedness under the Senior Discount Loan Agreement, together with any Exchange Notes (as defined in the Senior Discount Note Indenture) and any Additional Notes.

        "Senior Discount Loan Agreement" means the Loan Agreement, dated as of the Issue Date, among the Company and Blue Ridge Investments, LLC and The Chase Manhattan Bank, N.A. as initial Lenders thereunder, as such Loan Agreement may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, and whether provided under the original Loan Agreement or one or more other credit agreements, indentures or financing agreements or otherwise).

        "Senior Discount Note Indenture" means the Indenture between the Company and the relevant Trustee, pursuant to which Senior Discount Notes are issued, as such Indenture may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, and whether provided under the original Senior Discount Note Indenture or one or more other credit agreements, indentures or financing agreements or otherwise).

        "Senior Securities" has the meaning specified in paragraph (b)(iii).

        "S&P" means Standard & Poor's Ratings Service, a division of The McGraw-Hill Companies, Inc., and its successors.

        "Special Redemption Price" has the meaning specified in paragraph (e)(i)(B).

        "Standard Receivable Obligations" means representations, warranties, covenants, indemnities and other obligations (including Guarantees and Indebtedness) that are reasonably customary in connection with a Financing Disposition (as determined by the Company in good faith), including, without limitation, those relating to the servicing of the assets of a Receivables Entity, it being understood that any Receivables Repurchase Obligation shall be deemed to be a Standard Receivable Obligation

        "Stated Amount" means, as to any share of Junior Preferred Stock at any time, the sum of: (i) the Liquidation Preference of such share as of such time, plus (ii) the amount of any accumulated and unpaid dividends with respect to such share as calculated pursuant to paragraph (c)(i) as of such time.

        "Stated Maturity" means, with respect to any security, the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the happening of any contingency).

        "Subsidiary" of any Person means any corporation, association, partnership or other business entity of which more than 50% of the total voting power of shares of Capital Stock or other equity interests (including partnership interests) entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by (i) such person or (ii) one or more Subsidiaries of such Person.

        "Successor Company" has the meaning specified in paragraph (l)(i).

        "Successor Company Stock" has the meaning specified in paragraph (l)(i)(A).

        "Trade Payables" means, with respect to any Person, any accounts payable or any indebtedness or monetary obligation to trade creditors created, assumed or guaranteed by such Person arising in the ordinary course of business in connection with the acquisition of goods or services.

        "Transactions" means, collectively, the Allied Acquisition, the offering and issuance of the Notes and the Senior Discount Notes, the initial borrowings under the Senior Credit Facility and the Interim Loan Facility, the issuance by the Company of Capital Stock as part of the consideration for the Allied Acquisition, and all other related transactions.

        "Transfer" unless the context otherwise requires, any sale, assignment, pledge or other disposition of any security, or of any interest therein, which could constitute a "sale" as that term is defined in Section 2(3) of the Securities Act.

        "Unrestricted Subsidiary" means for the Company or NAVL, respectively, (i) any Subsidiary of such Parent that at the time of determination is an Unrestricted Subsidiary, as designated by the Board in the manner provided below, and (ii) any Subsidiary of an Unrestricted Subsidiary of such Parent. The Board may designate any Subsidiary of such Parent (including any newly acquired or newly formed Subsidiary of such Parent) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of, or owns or holds any Lien on any property of, NAVL or any other Restricted Subsidiary of NAVL that is not a Subsidiary of the Subsidiary to be so designated. The Board may designate any Unrestricted Subsidiary of such Parent to be a Restricted Subsidiary of such Parent; provided, that immediately after giving effect to such designation either (x) the Company or NAVL could incur at least $1.00 of additional Indebtedness under paragraph (l)(ii)(A) or (y) the Consolidated Coverage Ratio of the Company or NAVL would be greater than it was immediately prior to giving effect to such designation. Any such designation by the Board shall be evidenced by an Officer's Certificate certifying that such designation complied with the foregoing provisions.

        "Voting Stock" of an entity means all classes of Capital Stock of such entity then outstanding and normally entitled to vote in the election of directors or all interests in such entity with the ability to control the management or actions of such entity.

Annex A to Annex I

THIS DEBENTURE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY OTHER APPLICABLE SECURITIES LAWS, AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT AND ANY OTHER APPLICABLE SECURITIES LAWS, AS MORE FULLY PROVIDED IN SECTION 8.3 OF THIS DEBENTURE.

EACH DEBENTURE MAY HAVE ITS OWN PRINCIPAL AMOUNT AND STATED AMOUNT, WHICH MAY BE SIGNIFICANTLY GREATER OR LESS THAN OTHER DEBENTURES. ABSENT MANIFEST ERROR, THE AMOUNT OF PRINCIPAL AMOUNT SET FORTH IN THE REGISTER FOR EACH DEBENTURE SHALL BE CONCLUSIVE. PROSPECTIVE TRANSFEREES SHOULD REFER TO THE REGISTER TO DETERMINE THE PRINCIPAL AMOUNT OF ANY DEBENTURES THAT THEY MAY BE RECEIVING.

[OTHER LEGENDS, IF ANY, TO BE INCLUDED AS REQUIRED BY LAW]

SIRVA, INC.

Junior Subordinated Exchange Debentures due [                        ], 2010

Certificate No.             , representing
[Number of Debentures] and New York, N.Y.
$[Stated Amount under
Certificate of Designation]
in aggregate initial Principal Amount                         ,         

ARTICLE 1
OBLIGATION TO PAY

        FOR VALUE RECEIVED, the undersigned, SIRVA, INC., a Delaware corporation (the "Company"), promises to pay to                        , a company organized under the laws                        , or any registered assign thereof (collectively, the "Holder"), the principal amount of $[Stated Amount under Certificate of Designation], as adjusted from time to time in accordance with the following sentence (as so adjusted, the "Principal Amount") on [                        ], 2010, with interest on the unpaid balance of such principal amount outstanding from time to time, at the rates per annum and in the manner set forth below, payable as provided below after the Exchange Date (as defined in Section 2.1), until such unpaid balance shall become due and payable (whether at maturity, upon any prepayment, or otherwise). As of any time, the Principal Amount of any Debenture represented by this Debenture Certificate (1) shall be an amount equal to the excess of principal amount outstanding from time to time of such Debenture over the Adjustment Amount with respect to such Debenture, and (2) for the avoidance of doubt shall not include accrued and unpaid interest.

        The Debentures shall bear interest, commencing on the Exchange Date, and interest shall be paid or, if accrued and unpaid, compounded, quarterly on each Interest Payment Date, at a rate per annum equal to 12.4%, calculated on the basis of a 360-day year consisting of twelve 30-day months. Interest, when paid, shall be paid as set forth in Article III and Section 4.2 hereof.

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ARTICLE 2
DEFINITIONS

        Section 2.1    Definitions.

        For all purposes of this Debenture Certificate and the Debentures represented thereby, except as otherwise expressly provided or unless the context otherwise requires:

        (A)  the terms defined in this Debenture Certificate have the meanings assigned to them in this Debenture Certificate;

        (B)  "or" is not exclusive;

        (C)  all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP;

        (D)  the words "herein," "hereof" and "hereunder", this "Debenture Certificate" and other words of similar import refer to this Debenture Certificate as a whole and not to any particular paragraph or other subdivision;

        (E)  all references to "$" or "dollars" shall refer to the lawful currency of the United States of America;

        (F)  the words "include," "included" and "including" as used herein shall be deemed in each case to be followed by the phrase "without limitation," if not expressly followed by such phrase or the phrase "but not limited to"; and

        (G)  any reference to a paragraph refers to the specified paragraph of the Debenture Certificate.

        (2)    Specific Definitions.    As used in this Debenture Certificate, the following terms shall have the following meanings (with terms defined in the singular having comparable meanings when used in the plural and vice versa), unless the context otherwise requires:

        "Additional Notes" has the meaning specified in the applicable Indenture.

        "Adjustment Amount" means, with respect to any Debenture at any time, the sum of (i) the aggregate amount of the reductions made with respect to such Debenture pursuant to Section 6.4(B) and (ii) an amount, as of any time, equal to the quotient of (A) an aggregate amount equal to, for each year until and including the fifth anniversary of the Issue Date, one half of the excess of (x) all interest paid or accrued (whether or not paid) on the Notes (excluding any Additional Notes), the Senior Discount Notes and $25.0 million aggregate principal amount of borrowings under the Tranche B Term Loan Facility (as such term is defined in the Senior Credit Facility) as of such time over (y) all interest that would have been paid or accrued as of such time on debt securities in an aggregate principal amount of $210 million (the "Base Amount") with the same final Stated Maturity as the Notes and bearing interest at 12% per annum, with semi-annual interest payments (based on a 360-day year consisting of twelve 30-day months) and no principal payment due prior to such final Stated Maturity divided by (B) the total number of outstanding shares of Junior Preferred Stock (prior to the Exchange Date) or Debentures (on and after the Exchange Date), provided that the aggregate amount determined under this clause (ii) for any year with respect to all outstanding shares of Junior Preferred Stock (prior to the Exchange Date) or Debentures (on and after the Exchange Date) shall not exceed $2.5 million (the "Annual Cap"). In the event, prior to the fifth anniversary, of (a) an optional redemption of any Notes or Senior Discount Notes or (b) an optional prepayment of up to $25 million in aggregate principal amount of the Tranche B Term Loan (any such redemption or prepayment, a "Redemption Amount"), (1) the Base Amount shall be reduced by the Redemption Amount and (2) the Annual Cap shall thereafter be equal to the difference between (X) $2.5 million and (Y) an amount equal to

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$2.5 million multiplied by a fraction, the numerator of which is the Redemption Amount and the denominator of which is the Base Amount.

        "Affiliate" of any specified Person means any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, "control" when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing.

        "Agent" means any moving or storage company or contractor, or other Person, that provides sales, packing, warehousing, hauling or other services in connection with the ordinary course of business or operations of the Company or any of its Subsidiaries, or any Affiliate of any such Agent.

        "Agent Guarantee" means any Guarantee by the Company, NAVL or any Restricted Subsidiary of Indebtedness or other obligations of any Agent.

        "all or substantially all" has the meaning given to such phrase in the Revised Model Business Corporation Act and commentary thereto.

        "Allied Acquisition" means the acquisition of Capital Stock and/or assets of certain Subsidiaries of NFC engaged in moving services businesses pursuant to the Acquisition Agreement dated as of September 14, 1999 between the Company and NFC, and the other transactions contemplated thereby.

        "Average Life" means, as of the date of determination, with respect to any Indebtedness or Preferred Stock, the quotient obtained by dividing (i) the sum of the products of the numbers of years from the date of determination to the dates of each successive scheduled principal payment of such Indebtedness or redemption or similar payment with respect to such Preferred Stock multiplied by the amount of such payment by (ii) the sum of all such payments.

        "Bank Indebtedness" means any and all amounts, whether outstanding on the Issue Date or thereafter incurred, payable under or in respect of the Senior Credit Facility, including without limitation principal, premium (if any), interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company or any Restricted Subsidiary whether or not a claim for post-filing interest is allowed in such proceedings), fees, charges, expenses, reimbursement obligations, guarantees, other monetary obligations of any nature and all other amounts payable thereunder or in respect thereof.

        "Bankruptcy Law" has the meaning set forth in Section 5.1.

        "Board" means the Board of Directors of the Company or NAVL, or any committee thereof duly authorized to act on behalf of such Board.

        "Board of Directors" has the meaning specified in the first paragraph of the Certificate of Designation.

        "Borrowing Base" means 85% of accounts receivables of NAVL and its Restricted Subsidiaries (determined in accordance with GAAP as of the end of the most recently ended fiscal quarter for which consolidated financial statements of NAVL are available).

        "Business Day" means any day other than a Saturday, Sunday or other day on which commercial banking institutions are authorized or required by law to close in New York City.

        "Capitalized Lease Obligation" means an obligation that is required to be classified and accounted for as a capitalized lease for financial reporting purposes in accordance with GAAP. The

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Stated Maturity of any Capitalized Lease Obligation shall be the date of the last payment of rent or any other amount due under the related lease.

        "Capital Stock" of any Person means any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such Person, including any Preferred Stock, but excluding any debt securities convertible into such equity.

        "Certificate of Designation" means the Certificate of Designation of the powers, preferences and relative, participating, optional and other special rights of the Junior Exchangeable Preferred Stock due 2010, par value $0.01 per share, of the Company.

        "CD&R" means Clayton, Dubilier & Rice, Inc.

        "CD&R Fund" means Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands exempted limited partnership (together with any successor investment vehicle managed by CD&R).

        "Change of Control" means:

(A)

a Change of Control Triggering Event (as defined in the Indentures) has occurred and is continuing (without waiver under the respective Indenture); and



(B)

(1) any "person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, is or becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the total voting power of the Voting Stock of the Company;

(2) the Company sells or transfers (in one or a series of related transactions) all or substantially all of the assets of the Company and its Restricted Subsidiaries to another Person (other than one or more Permitted Holders or the Company or one or more Subsidiaries thereof); or

(3) during any period of two consecutive years (during which period the Debentures shall have been outstanding), individuals who at the beginning of such period were members of the Board of Directors (together with any new members thereof whose election by the Board of Directors or whose nomination for election by holders of Capital Stock of the Company was approved by one or more Permitted Holders or by a vote of a majority of the members of the Board of Directors then still in office who were either members thereof at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office.

        "Change of Control Default" has the meaning specified in the definition of "Mandatory Redemption Event" below.

        "Change of Control Purchase Price" has the meaning specified in Section 7.4(i).

        "Code" means the Internal Revenue Code of 1986, as amended.

        "Commission" means the Securities and Exchange Commission.

        "Common Stock" has the meaning specified in paragraph (b) of the Certificate of Designation.

        "Company" has the meaning specified in the first paragraph of this Debenture Certificate.

        "Consolidated Coverage Ratio" of the Company or NAVL, respectively, as of any date of determination means the ratio of (i) the aggregate amount of Consolidated EBITDA of such

4

Parent for the period of the most recent four consecutive fiscal quarters ending prior to the date of such determination for which consolidated financial statements of such Parent are available to (ii) Consolidated Interest Expense of such Parent for such four fiscal quarters (in each case, determined, for each fiscal quarter (or portion thereof) of the four fiscal quarters ending prior to the Issue Date, on a pro forma basis to give effect to the Allied Acquisition as if it had occurred at the beginning of such four-quarter period); provided, that

        (1)   if since the beginning of such period, such Parent or any Restricted Subsidiary of such Parent has Incurred any Indebtedness that remains outstanding on such date of determination or if the transaction giving rise to the need to calculate the Consolidated Coverage Ratio is an Incurrence of Indebtedness, Consolidated EBITDA and Consolidated Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Indebtedness as if such Indebtedness had been Incurred on the first day of such period (except that in making such computation, the amount of Indebtedness under any revolving credit facility outstanding on the date of such calculation shall be computed based on (A) the average daily balance of such Indebtedness during such four fiscal quarters or such shorter period for which such facility was outstanding or (B) if such facility was created after the end of such four fiscal quarters, the average daily balance of such Indebtedness during the period from the date of creation of such facility to the date of such calculation),

        (2)   if since the beginning of such period, such Parent or any Restricted Subsidiary of such Parent has repaid, repurchased, redeemed, defeased or otherwise acquired, retired or discharged any Indebtedness (each, a "Discharge") or if the transaction giving rise to the need to calculate the Consolidated Coverage Ratio involves a Discharge of Indebtedness (in each case other than Indebtedness Incurred under any revolving credit facility unless such Indebtedness has been permanently repaid), Consolidated EBITDA and Consolidated Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Discharge of such Indebtedness, including with the proceeds of such new Indebtedness, as if such Discharge had occurred on the first day of such period,

        (3)   if since the beginning of such period, such Parent or any Restricted Subsidiary of such Parent shall have disposed of any company, any business or any group of assets constituting an operating unit of a business (any such disposition, a "Sale"), the Consolidated EBITDA for such period shall be reduced by an amount equal to the Consolidated EBITDA (if positive) attributable to the assets that are the subject of such Sale for such period or increased by an amount equal to the Consolidated EBITDA (if negative) attributable thereto for such period and Consolidated Interest Expense for such period shall be reduced by an amount equal to (A) the Consolidated Interest Expense attributable to any Indebtedness of such Parent or any Restricted Subsidiary of such Parent repaid, repurchased, redeemed, defeased or otherwise acquired, retired or discharged with respect to such Parent and its continuing Restricted Subsidiaries in connection with such Sale for such period (including but not limited to through the assumption of such Indebtedness by another Person) plus (B) if the Capital Stock of any Restricted Subsidiary of such Parent is sold, the Consolidated Interest Expense for such period attributable to the Indebtedness of such Restricted Subsidiary to the extent such Parent and its continuing Restricted Subsidiaries are no longer liable for such Indebtedness after such Sale,

        (4)   if since the beginning of such period, such Parent or any Restricted Subsidiary of such Parent (by merger, consolidation or otherwise) shall have made an Investment in any Person that thereby becomes a Restricted Subsidiary of such Parent, or otherwise acquired any company, any business or any group of assets constituting an operating unit of a business, including any such Investment or acquisition occurring in connection with a transaction causing a calculation to be made hereunder (any such Investment or acquisition, a

5

"Purchase"), Consolidated EBITDA and Consolidated Interest Expense for such period shall be calculated after giving pro forma effect thereto (including the Incurrence of any related Indebtedness) as if such Purchase occurred on the first day of such period, and

        (5)   if since the beginning of such period, any Person became a Restricted Subsidiary of such Parent or was merged or consolidated with or into of such Parent or any Restricted Subsidiary of such Parent, and since the beginning of such period such Person shall have Discharged any Indebtedness or made any Sale or Purchase that would have required an adjustment pursuant to clause (2), (3) or (4) above if made by such Parent or a Restricted Subsidiary of such Parent during such period, Consolidated EBITDA and Consolidated Interest Expense for such period shall be calculated after giving pro forma effect thereto as if such Discharge, Sale or Purchase occurred on the first day of such period.

        For purposes of this definition, whenever pro forma effect is to be given to any Sale, Purchase or other transaction, or the amount of income or earnings relating thereto and the amount of Consolidated Interest Expense associated with any Indebtedness Incurred or repaid, repurchased, redeemed, defeased or otherwise acquired, retired or discharged in connection therewith, the pro forma calculations in respect thereof may include anticipated cost savings relating to any such Sale, Purchase or other transaction that the Company or NAVL reasonably believes in good faith could have been achieved during the relevant four quarter period as a result of such Sale, Purchase or other transaction (provided that both (i) such cost savings were identified and quantified in an Officer's Certificate at the time of the consummation of such transaction and (ii) with respect to each such transaction completed prior to the 90^th day preceding the relevant date of determination, actions were commenced or initiated by the Company or NAVL within 90 days of the consummation of such transaction to effect such cost savings identified in such Officer's Certificate and with respect to any other transaction, such Officer's Certificate sets forth the specific steps to be taken within the 90 days after the consummation of such transaction to accomplish such cost savings). If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest expense on such Indebtedness shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account any Interest Rate Agreement applicable to such Indebtedness). If any Indebtedness bears, at the option of the Company or a Restricted Subsidiary, a rate of interest based on a prime or similar rate, a eurocurrency interbank offered rate or other fixed or floating rate, and such Indebtedness is being given pro forma effect, the interest expense on such Indebtedness shall be calculated by applying such optional rate as the Company or such Restricted Subsidiary may designate. If any Indebtedness that is being given pro forma effect was Incurred under a revolving credit facility, the interest expense on such Indebtedness shall be computed based upon the average daily balance of such Indebtedness during the applicable period. Interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate determined in good faith by a responsible financial or accounting officer of the Company or NAVL to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with GAAP.

        "Consolidated EBITDA" of the Company or NAVL, respectively, means, for any period, the Consolidated Net Income of such Parent for such period, plus the following to the extent deducted in calculating such Consolidated Net Income: (i) provision for all taxes (whether or not paid, estimated or accrued) based on income, profits or capital, (ii) Consolidated Interest Expense, (iii) depreciation, amortization (including but not limited to amortization of goodwill and intangibles and amortization and write-off of financing costs) and all other non-cash charges or non-cash losses, (iv) any expenses or charges related to any Equity Offering, Investment or Indebtedness permitted by this Debenture Certificate (whether or not consummated or incurred) and (v) the amount of any minority interest expense. To the extent Consolidated EBITDA of such Parent would otherwise include the amount of any Receivables Fees excluded from Consolidated

6

Interest Expense of such Parent pursuant to clause (iii) of the definition of Consolidated Interest Expense, Consolidated EBITDA of such Parent shall be reduced by such amount.

        "Consolidated Interest Expense" of the Company or NAVL, respectively, means, for any period, (i) the total interest expense of such Parent and its Restricted Subsidiaries to the extent deducted in calculating Consolidated Net Income of such Parent, net of any interest income of such Parent and its Restricted Subsidiaries, including without limitation any such interest expense consisting of (a) interest expense attributable to Capitalized Lease Obligations, (b) amortization of debt discount, (c) interest in respect of Indebtedness of any other Person that has been Guaranteed by such Parent or any Restricted Subsidiary of such Parent (other than Indebtedness Guaranteed under any Management Guarantee or Agent Guarantee, except to the extent the interest thereon is actually being paid by such Parent or a Restricted Subsidiary thereof), (d) non-cash interest expense, (e) the interest portion of any deferred payment obligation, and (f) commissions, discounts and other fees and charges owed with respect to letters of credit and bankers' acceptance financing, plus (ii) dividends paid in cash in respect of Disqualified Stock of such Parent or a Restricted Subsidiary of such Parent or in respect of Preferred Stock of a Restricted Subsidiary of such Parent and minus (iii) to the extent otherwise included in such interest expense referred to in clause (i) above, Receivables Fees and amortization or write-off of financing costs, in each case under clauses (i) through (iii) as determined on a Consolidated basis in accordance with GAAP; provided, that gross interest expense shall be determined after giving effect to any net payments made or received by such Parent and its Restricted Subsidiaries with respect to Interest Rate Agreements.

        "Consolidated Net Income" of the Company or NAVL, respectively, means, for any period, the net income (loss) of such Parent and its Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP and before any reduction in respect of Preferred Stock dividends (including dividends in respect of any Junior Preferred Stock); provided, that there shall not be included in such Consolidated Net Income:

        (i)    any net income (loss) of any Person if such Person is not a Restricted Subsidiary of such Parent, except that (A) subject to the limitations contained in clause (iv) below, such Parent's equity in the net income of any such Person for such period shall be included in such Consolidated Net Income up to the aggregate amount actually distributed by such Person during such period to such Parent or a Restricted Subsidiary of such Parent as a dividend or other distribution (subject, in the case of a dividend or other distribution to a Restricted Subsidiary of such Parent, to the limitations contained in clause (iii) below) and (B) such Parent's equity in the net loss of such Person shall be included to the extent of the aggregate Investment of such Parent or any of its Restricted Subsidiaries in such Person,

        (ii)   any net income (loss) of any Person acquired by such Parent or a Restricted Subsidiary of such Parent in a pooling of interests transaction for any period prior to the date of such acquisition,

        (iii)  any net income (loss) of any Restricted Subsidiary of NAVL if such Restricted Subsidiary is subject to restrictions, directly or indirectly, on the payment of dividends or the making of similar distributions by such Restricted Subsidiary, directly or indirectly, to NAVL by operation of the terms of such Restricted Subsidiary's charter or any agreement, instrument, judgment, decree, order, statute or governmental rule or regulation applicable to such Restricted Subsidiary or its stockholders (other than (x) restrictions that have been waived or otherwise released, (y) restrictions pursuant to this Debenture Certificate, the Notes, the Senior Discount Notes or any Indenture and (z) restrictions in effect on the Issue Date with respect to a Restricted Subsidiary and other restrictions with respect to such Restricted Subsidiary that taken as a whole are not materially less favorable to the

7

Noteholders than such restrictions in effect on the Issue Date), except that (A) subject to the limitations contained in clause (iv) below, NAVL's equity in the net income of any such Restricted Subsidiary for such period shall be included in such Consolidated Net Income up to the aggregate amount of any dividend or distribution that was or that could have been made by such Restricted Subsidiary during such period to NAVL or another Restricted Subsidiary of NAVL (subject, in the case of a dividend that could have been made to another Restricted Subsidiary of NAVL, to the limitation contained in this clause) and (B) the net loss of such Restricted Subsidiary shall be included to the extent of the aggregate Investment of NAVL or any of its other Restricted Subsidiaries in such Restricted Subsidiary,

        (iv)  any gain or loss realized upon the sale or other disposition of any asset of such Parent or any Restricted Subsidiary of such Parent (including pursuant to any sale/leaseback transaction) that is not sold or otherwise disposed of in the ordinary course of business (as determined in good faith by the Board),

        (v)   any item classified as an extraordinary, unusual or nonrecurring gain, loss or charge (including without limitation (a) any compensation expense for stock options that will be cashed out, converted, exchanged or otherwise retired in connection with the Allied Acquisition, (b) any charge or expense incurred for employee bonuses in connection with the Allied Acquisition, and (c) fees, expenses and charges associated with the Allied Acquisition or any acquisition, merger or consolidation after the Issue Date),

        (vi)  the cumulative effect of a change in accounting principles,

        (vii) all deferred financing costs written off and premiums paid in connection with any early extinguishment of Indebtedness,

        (viii) any unrealized gains or losses in respect of Currency Agreements,

        (ix)  any unrealized foreign currency transaction gains or losses in respect of Indebtedness of any Person denominated in a currency other than the functional currency of such Person, and

        (x)   any non-cash compensation charge arising from any grant of stock, stock options or other equity based awards.

        In the case of any unusual or nonrecurring gain, loss or charge not included in Consolidated Net Income pursuant to clause (v) above in any determination thereof, the Company or NAVL will prepare an Officer's Certificate promptly after the date on which Consolidated Net Income is so determined, setting forth the nature and amount of such unusual or nonrecurring gain, loss or charge.

        "Consolidated Tangible Assets" means, as of any date of determination, the total assets less the total intangible assets (including, without limitation, goodwill) shown on the consolidated balance sheet of NAVL and its Restricted Subsidiaries as of the most recent date for which such a balance sheet is available, determined on a consolidated basis in accordance with GAAP (and, in the case of any determination relating to any Incurrence of Indebtedness, on a pro forma basis including any property or assets being acquired in connection therewith).

        "Consolidation" means for the Company or NAVL, respectively, the consolidation of the accounts of each of the Restricted Subsidiaries of such Parent with those of such Parent in accordance with GAAP; provided that "Consolidation" will not include consolidation of the accounts of any Unrestricted Subsidiary of such Parent, but the interest of such Parent or any Restricted Subsidiary of such Parent in any Unrestricted Subsidiary of such Parent will be accounted for as an investment. The term "Consolidated" has a correlative meaning.

8

        "Credit Facilities" means, one or more of (x) the Senior Credit Facility and (y) other facilities or arrangements, in each case with one or more banks or other institutions providing for revolving credit loans, term loans, receivables financings (including without limitation through the sale of receivables to such institutions or to special purpose entities formed to borrow from such institutions against such receivables), letters of credit or other Indebtedness, in each case, including all agreements, instruments and documents executed and delivered pursuant to or in connection with any of the foregoing, in each case as the same may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, whether with the original banks or other institutions or other banks or other institutions or otherwise, and whether provided under any original Credit Facility or one or more other credit agreements, indentures, financing agreements or other Credit Facilities or otherwise). Without limiting the generality of the foregoing, the term "Credit Facility" shall include any agreement (i) changing the maturity of any Indebtedness incurred thereunder or contemplated thereby, (ii) adding Subsidiaries of the Company as additional borrowers or guarantors thereunder, (iii) increasing the amount of Indebtedness incurred thereunder or available to be borrowed thereunder or (iv) otherwise altering the terms and conditions thereof.

        "Currency Agreement" means, in respect of a Person, any foreign exchange contract, currency swap agreement or other similar agreement or arrangements (including derivative agreements or arrangements), as to which such Person is a party or a beneficiary.

        "Debenture" means, individually and collectively the Debentures represented by this Debenture Certificate and any other junior subordinated exchange debenture of like terms issued by the Company in exchange for the Debentures represented by this Debenture Certificate (upon a transfer or otherwise) or in lieu of a payment in cash pursuant to Article 1 or Article 4. References to "this Debenture" are to the Debentures represented by this Debenture Certificate.

        "Debt Agreements" means the Senior Credit Facility, the Indentures, the Notes and the Senior Discount Notes, and any refinancing thereof, provided that any agreement governing any such refinancing shall not be a Debt Agreement to the extent that it imposes greater restrictions on the payment of interest on, or the mandatory redemption or purchase of, the Debentures than the Debt Agreement thereby refinanced.

        "Default Amount" means (i) $0 for any date during the period beginning on the Issue Date and ending on the date before the first Payment Date falling on or after the 63-month anniversary of the Issue Date and (ii) as of any other date, the lesser of (A) the aggregate amount of, as the case may be, dividends or interest actually permitted under the Debt Agreements to have been declared (in the case of dividends) and paid by the Company on the Junior Preferred Stock or Debentures on each Payment Date that occurs during the period beginning on the first Payment Date falling on or after the 63-month anniversary of the Issue Date and ending on such date, (B) the aggregate amount of dividends actually permitted under the Debt Agreements to have been declared and paid by NAVL to the Company on each such Payment Date for the purpose of paying dividends on the Junior Preferred Stock or interest on the Debentures on such respective Payment Date and (C) the sum of the Minimum Amounts applicable to each Payment Date that occurs during the period beginning on the first Payment Date falling on or after the 63-month anniversary of the Issue Date and ending on such date.

        "Default Rate" means a quarterly rate equal to (i) 1.50% in the case of each Dividend Payment Date or Interest Payment Date occurring during the one-year period beginning on the first Dividend Payment Date or Interest Payment Date falling on or after the 63-month anniversary of the Issue Date and (ii) 1.75% in the case of each Dividend Payment Date or Interest Payment Date falling on or after the 75-month anniversary of the Issue Date.

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        "Designated Senior Indebtedness" means (i) the Bank Indebtedness, (ii) the Company's obligations under the Notes and the Senior Discount Notes and the Indentures, and (iii) any one or more issues of other Senior Indebtedness specifically designated by the Company in the instrument evidencing or governing such Senior Indebtedness as "Designated Senior Indebtedness" for purposes of this Debenture.

        "Disqualified Stock" means, with respect to any Person, any Capital Stock (other than Management Stock) that by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable or exercisable) or upon the happening of any event (i) matures or is mandatorily redeemable pursuant to a sinking fund obligation or otherwise, (ii) is convertible or exchangeable for Indebtedness or Disqualified Stock or (iii) is redeemable at the option of the holder thereof, in whole or in part, in each case on or prior to the 91^st day following the final Stated Maturity of the Notes. Notwithstanding the preceding sentence, (a) any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require the Company or NAVL to repurchase such Capital Stock upon the occurrence of an event described therein as a change of control or an asset sale shall not constitute Disqualified Stock if the terms of such Capital Stock provide that the Company or NAVL may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with Section 6.2, (b) any Capital Stock that would constitute Disqualified Stock solely because such Capital Stock is issued pursuant to any plan for the benefit of employees and may be required to be repurchased by the Company or NAVL in order to satisfy applicable regulatory obligations shall not constitute Disqualified Stock and (c) the Junior Preferred Stock shall not constitute Disqualified Stock.

        "Dividend Payment Date" means March 15, June 15, September 15 and December 15 of each year.

        "Dividend Period" has the meaning set forth in the Certificate of Designation.

        "Domestic Subsidiary" of the Company or NAVL, respectively, means any Restricted Subsidiary of such Parent other than a Foreign Subsidiary of such Parent.

        "Equity Offering" means a sale of Capital Stock (other than Disqualified Stock) of the Company or NAVL (x) that is a sale of Capital Stock of the Company or NAVL or (y) proceeds of which are contributed to the Company or any of its Restricted Subsidiaries.

        "Event of Default" has the meaning specified in Article 5.

        "Exchange Act" means the Securities Exchange Act of 1934, as amended.

        "Exchange Act" means the Securities Exchange Act of 1934, as amended.

        "Exchange Date" has the meaning specified in paragraph (g)(i)(A) of the Certificate of Designation.

        "Exchange Notice" has the meaning specified in paragraph (g)(i)(A).

        "Financing Disposition" means any sale, transfer, conveyance or other disposition of property or assets by the Company or any Subsidiary thereof to any Receivables Entity, or by any Receivables Subsidiary, in each case in connection with the Incurrence by a Receivables Entity of Indebtedness, or obligations to make payments to the obligor on Indebtedness, which may be secured by a Lien in respect of such property or assets.

        "Foreign Subsidiary" of the Company or NAVL, respectively, means (a) any Restricted Subsidiary of such Parent that is not organized under the laws of the United States of America or any state thereof or the District of Columbia and (b) any Restricted Subsidiary of such Parent that

10

has no material assets other than securities of one or more Foreign Subsidiaries, and other assets relating to an ownership interest in any such securities or Subsidiaries.

        "Foreign Subsidiary Coverage Ratio" of the Company or NAVL, respectively, as of any date of determination means the ratio of (i) the combined portion attributable to Foreign Subsidiaries of such Parent, taken as a whole, of the aggregate amount of Consolidated EBITDA of such Parent for the period of the most recent four consecutive fiscal quarters ending prior to the date of such determination for which consolidated financial statements of such Parent are available to (ii) the combined portion attributable to Foreign Subsidiaries of such Parent, taken as a whole, of Consolidated Interest Expense of such Parent for such four fiscal quarters, all calculated after giving effect to all intercompany eliminations applied in preparing the relevant consolidated financial statements of such Parent (and without giving effect to clause (iii) of the definition of the term Consolidated Net Income as it relates to restrictions on the payment of dividends or the making of similar distributions by any Foreign Subsidiary to NAVL or any Domestic Subsidiary of NAVL, but giving effect to such clause as it relates to any such restrictions on the payment of dividends or the making of similar distributions by any Foreign Subsidiary of NAVL to another Foreign Subsidiary of NAVL), and otherwise in accordance with the definition of the term "Coverage Ratio" (including but not limited to in accordance with all pro forma and other adjustments provided for in such definition).

        "GAAP" means generally accepted accounting principles in the United States of America as in effect on the Issue Date (for purposes of the definitions of the terms "Consolidated Coverage Ratio," "Foreign Subsidiary Coverage Ratio," "Consolidated EBITDA," "Consolidated Interest Expense," "Consolidated Net Income" and "Consolidated Tangible Assets," all defined terms in this Debenture Certificate to the extent used in or relating to any of the foregoing definitions, and all ratios and computations based on any of the foregoing definitions) and as in effect from time to time (for all other purposes under this Debenture Certificate), including those set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as approved by a significant segment of the accounting profession. All ratios and computations based on GAAP contained in this Debenture Certificate shall be computed in conformity with GAAP.

        "Guarantee" means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness or other obligation of any other Person; provided that the term "Guarantee" shall not include endorsements for collection or deposit in the ordinary course of business. The term "Guarantee" used as a verb has a corresponding meaning.

        "Hedging Obligations" of any Person means the obligations of such Person pursuant to any Interest Rate Agreement or Currency Agreement.

        "Holder" shall mean the registered owner of this Debenture, as set forth in the Register.

        "Holding Expenses" means (i) costs (including all professional fees and expenses) incurred by the Company to comply with its reporting obligations under federal or state laws or under any Indenture, including any reports filed with respect to the Securities Act, Exchange Act or the respective rules and regulations promulgated thereunder, (ii) indemnification obligations of the Company owing to directors, officers, employees or other Persons under its charter or by-laws or pursuant to written agreements with any such Person, (iii) fees and expenses payable by the Company in connection with the Transactions, (iv) other operational expenses of the Company incurred in the ordinary course of business, and (v) expenses incurred by the Company in connection with any public offering of Capital Stock or Indebtedness.

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        "Incur" means issue, assume, enter into any Guarantee of, incur or otherwise become liable for; provided, however, that any Indebtedness or Capital Stock of a Person existing at the time such Person becomes a Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Subsidiary at the time it becomes a Subsidiary. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an Incurrence of Indebtedness. Any Indebtedness issued at a discount (including Indebtedness on which interest is payable through the issuance of additional Indebtedness) shall be deemed Incurred at the time of original issuance of the Indebtedness at the initial accreted amount thereof.

        "Indebtedness" means, with respect to any Person on any date of determination (without duplication):

(i)

the principal of indebtedness of such Person for borrowed money,



(ii)

the principal of obligations of such Person evidenced by bonds, debentures, notes or other similar instruments,



(iii)

all reimbursement obligations of such Person in respect of letters of credit or other similar instruments (the amount of such obligations being equal at any time to the aggregate then undrawn and unexpired amount of such letters of credit or other instruments plus the aggregate amount of drawings thereunder that have not then been reimbursed),



(iv)

all obligations of such Person to pay the deferred and unpaid purchase price of property (except Trade Payables), which purchase price is due more than one year after the date of placing such property in final service or taking final delivery and title thereto,



(v)

all Capitalized Lease Obligations of such Person,



(vi)

the redemption, repayment or other repurchase amount of such Person with respect to any Disqualified Stock of such Person or (if such Person is a Subsidiary of NAVL other than a Note Guarantor) any Preferred Stock of such Subsidiary, but excluding, in each case, any accrued dividends (the amount of such obligation to be equal at any time to the maximum fixed involuntary redemption, repayment or repurchase price for such Capital Stock, or if less (or if such Capital Stock has no such fixed price), to the involuntary redemption, repayment or repurchase price therefor calculated in accordance with the terms thereof as if then redeemed, repaid or repurchased, and if such price is based upon or measured by the fair market value of such Capital Stock, such fair market value shall be as determined in good faith by the Board or the board of directors or other governing body of the issuer of such Capital Stock),



(vii)

all Indebtedness of other Persons secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; provided that the amount of Indebtedness of such Person shall be the lesser of (A) the fair market value of such asset at such date of determination (as determined good faith by the Company) and (B) the amount of such Indebtedness of such other Persons,



(viii)

Guarantees of all Indebtedness of other Persons to the extent so Guaranteed by such Person, and



(ix)

to the extent not otherwise included in this definition, net Hedging Obligations of such Person (the amount of any such obligation to be equal at any time to the termination value of such agreement or arrangement giving rise to such Hedging Obligation that would be payable by such Person at such time).

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        The amount of Indebtedness of any Person at any date shall be determined as set forth above or otherwise provided in Article VI, or otherwise shall equal the amount thereof that would appear on a balance sheet of such Person (excluding any notes thereto) prepared in accordance with GAAP. The Junior Preferred Stock shall not constitute Indebtedness.

        "Indentures" mean the Note Indenture, the Senior Discount Note Indenture and the Senior Discount Loan Agreement.

        "Interest Default" means the failure of the Company to have paid interest on the Debentures (or dividends on (or Principal Amounts in respect of) the Junior Preferred Stock for which such Debentures were exchanged) as of any date (other than any date as of which the Default Amount is $0) in an amount at least equal to the Default Amount as of such date.

        "Interest Payment Date" means March 15, June 15, September 15 and December 15 of each year.

        "Interest Period" means each Quarterly Interest Period.

        "Interest Rate Agreement" means, with respect to any Person, any interest rate protection agreement, interest rate future agreement, interest rate option agreement, interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedge agreement or other similar agreement or arrangement (including derivative agreements or arrangements), as to which such Person is party or a beneficiary.

        "Interim Loan Facility" means the loan agreement dated as of the Issue Date among the Company, The Chase Manhattan Bank and Bank of America (or affiliates of such institutions), together with any notes, guarantees, pledge agreements, security agreements, other collateral documents, and other agreements, instruments and documents, executed and delivered pursuant to or in connection with any of the foregoing, in each case as the same may be amended, supplemented, waived or otherwise modified from time to time.

        "Inventory" means goods held for sale or lease by a Person in the ordinary course of business, net of any reserve for goods that have been segregated by such Person to be returned to the applicable vendor for credit, as determined in accordance with GAAP.

        "Investment" in any Person by any other Person means any direct or indirect advance, loan or other extension of credit (other than to customers, suppliers, Agents, directors, officers or employees of any Person in the ordinary course of business) or capital contribution (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others) to, or any purchase or acquisition of Capital Stock, Indebtedness or other similar instruments issued by, such Person. A Guarantee shall not be deemed to be or give rise to an Investment until such Guarantee is funded (in whole or in part). The amount of any Investment outstanding at any time shall be the original cost of such Investment, reduced (at the Company's option) by any dividend, distribution, interest payment, return of capital, repayment or other amount or value received in respect of such Investment.

        "Issue Date" means the date on which the Junior Preferred Stock was originally issued by the Company under the Certificate of Designation.

        "Junior Payment" has the meaning specified in paragraph (l)(ii)(A).

        "Junior Preferred Stock" has the meaning specified in paragraph (a) of the Certificate of Designation.

        "Junior Securities" has the meaning specified in paragraph (b)(i) of the Certificate of Designation.

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        "Lien" means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof).

        "Liquidation Preference" has the meaning specified in paragraph (a) of the Certificate of Designation.

        "Majority Holders" has the meaning specified in section 6.1.

        "Management Advances" means (1) loans or advances made to directors, officers or employees of the Company or any Restricted Subsidiary (x) in respect of travel, entertainment or moving-related expenses incurred in the ordinary course of business, (y) in respect of moving-related expenses incurred in connection with any closing or consolidation of any facility, or (z) in the ordinary course of business and (in the case of this clause (z)) not exceeding $2.5 million in the aggregate outstanding at any time, (2) promissory notes of Management Investors acquired in connection with the issuance of Management Stock to such Management Investors, (3) loans to Management Investors of funds applied to purchase Management Stock in an aggregate principal amount not exceeding $10.0 million outstanding at any time (less the aggregate principal amount of then outstanding borrowings by Management Investors then guaranteed by the Company or NAVL pursuant to clause (x) of the definition of Management Guarantees), (4) Management Guarantees, or (5) other Guarantees of borrowings by Management Investors in connection with the purchase of Management Stock, which Guarantees are permitted under Section 6.3.

        "Management Agreements" means, collectively, the Consulting Agreement, dated as of March 30, 1998, among the Company, NAVL and CD&R (and, in each case, its respective permitted successors and assigns thereunder) and the Indemnification Agreement, dated as of March 30, 1998, among the Company, NAVL, CD&R and Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands exempted limited Partnership (and, in each case, its respective permitted successors and assigns), as each may be amended, supplemented, waived or otherwise modified from time to time in accordance with the terms thereof.

        "Management Guarantees" means guarantees (x) of up to an aggregate principal amount of $10.0 million of borrowings by Management Investors in connection with their purchase of Management Stock outstanding at any time (less the aggregate principal amount of then outstanding loans made to Management Investors by the Company or NAVL pursuant to clause (3) of the definition of Management Advances) or (y) made on behalf of, or in respect of loans or advances made to, directors, officers or employees of the Company or any Restricted Subsidiary (1) in respect of travel, entertainment and moving-related expenses incurred in the ordinary course of business, or (2) in the ordinary course of business and (in the case of this clause (2)) not exceeding $2.5 million in the aggregate outstanding at any time.

        "Management Investors" means the officers, directors, employees and other members of the management of the Company, NAVL or any of their respective Subsidiaries (or of any Agent), or family members or relatives thereof, or trusts or partnerships for the benefit of any of the foregoing, or any of their heirs, executors, successors and legal representatives, or any Agent, who at any date beneficially own or have the right to acquire, directly or indirectly, Capital Stock of the Company or NAVL.

        "Management Stock" means Capital Stock of the Company or NAVL (including any options, warrants or other rights in respect thereof) held by any of the Management Investors.

        "Mandatory Redemption Event" has occurred if (1) there is an Interest Default for four consecutive quarterly periods; (2) the Company is permitted by the Debt Agreements but fails to discharge any redemption obligation of the Debentures when required, and NAVL is permitted by the Debt Agreements to dividend sufficient funds to the Company for such purpose; (3) the Company is permitted by the Debt Agreements but fails to make an Offer to purchase all

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outstanding Debentures following a Change of Control if such Offer to purchase is required to be made pursuant to Section 7.4 hereof or fails to purchase Debentures when required from Holders who elect to have such Debentures purchased pursuant to such Offer (a "Change of Control Default"), and in each case NAVL is permitted by the Debt Agreements to dividend sufficient funds to the Company for the purpose of purchasing all such outstanding Debentures or all such Debentures of electing Holders, as the case may be; or (4) the Company breaches or violates one of the provisions set forth in Article 6 hereof and the breach or violation continues for a period of 60 days or more after the Company receives notice thereof specifying the default from the Holders of at least 25% of the Principal Amount of Debentures then outstanding and there has been an acceleration of the maturity of the outstanding indebtedness under any Debt Agreements.

        "Mandatory Redemption Price" has the meaning specified in Section 7.2.

        "Minimum Amount" means, with respect to any Payment Date, an amount equal to the product of the Default Rate with respect to such date and the aggregate Stated Amounts as of such date of each Debenture and each share of Junior Preferred Stock for which such Debenture was exchanged.

        "Moody's" means Moody's Investors Service, Inc., and its successors.

        "NAVL" means North American Van Lines, Inc., a Delaware corporation, and any successor thereto.

        "Net Cash Proceeds," with respect to any issuance or sale of any securities of the Company or any Subsidiary by the Company or any Subsidiary, or any capital contribution, means the cash proceeds of such issuance, sale or contribution net of attorneys' fees, accountants' fees, underwriters' or placement agents' fees, discounts or commissions and brokerage, consultant and other fees actually incurred in connection with such issuance, sale or contribution and net of taxes paid or payable as a result thereof.

        "NFC" means NFC plc, a company organized under the laws of England and Wales.

        "Note Guarantor" means any Restricted Subsidiary that enters into a Guarantee of any Notes.

        "Noteholder" means the Person in whose name a Note is registered in the applicable Note register of the Company.

        "Notes" means the 13³/8% Senior Subordinated Notes of NAVL due 2009 issued under the Note Indenture, in an aggregate principal amount of $150.0 million, any Exchange Notes (as defined in the Note Indenture) and any Additional Notes.

        "Note Indenture" means the Indenture, dated as of the Issue Date, between NAVL and State Street Bank and Trust Company, as Trustee, pursuant to which Notes are issued, as such Indenture may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, and whether provided under the original Note Indenture or one or more other credit agreements, indentures or financing agreements or otherwise).

        "Offer" has the meaning specified in Section 7.4(i).

        "Officer" means, with respect to the Company or NAVL, the Chairman of the Board, the President, the Chief Executive Officer, the Chief Financial Officer, any Vice President, the Controller, the Treasurer or the Secretary (a) of such Person or (b) if such Person is owned or managed by a single entity, of such entity (or any other individual designated as an "Officer" for the purposes of the Certificate of Designation or this Debenture Certificate by the Board).

        "Officer's Certificate" means a certificate signed by one Officer of the Company or NAVL.

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        "Opinion of Counsel" means a written opinion from Debevoise & Plimpton, or other legal counsel who is reasonably acceptable to the Majority Holders. The counsel may be an employee of or counsel to the Company or NAVL.

        "Optional Redemption Price" has the meaning specified in Section 7.1(a).

        "Parent" means the Company or NAVL, as the case may be.

        "Parity Securities" has the meaning specified in paragraph (b)(ii) of the Certificate of Designation.

        "Payment Date" means March 15, June 15, September 15 and December 15 of each year.

        "Permitted Holder" means any of the following: (i) any of CD&R Fund, the Management Investors, CD&R and their respective Affiliates; (ii) any investment fund or vehicle managed, sponsored or advised by CD&R and (iii) any Person acting in the capacity of an underwriter in connection with a public or private offering of Capital Stock of the Company or NAVL.

        "Person" means any individual, corporation, partnership, joint venture, association, joint-stock company, limited liability company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

        "Preferred Stock" as applied to the Capital Stock of any corporation means Capital Stock of any class or classes (however designated) that is preferred as to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such corporation, over shares of Capital Stock of any other class of such corporation.

        "Public Offering" any underwritten public offering of Common Stock led by one or more underwriters at least one of which is of nationally recognized standing pursuant to an effective registration statement under the Securities Act.

        "Purchase Date" with respect to any Debentures, means the date on which such Debentures are purchased by the Company as contemplated by Section 7.4 above.

        "Purchase Money Obligations" means any Indebtedness Incurred to finance or refinance the acquisition, leasing, construction or improvement of property (real or personal) or assets, and whether acquired through the direct acquisition of such property or assets or the acquisition of the Capital Stock of any Person owning such property or assets, or otherwise.

        "Purchase Notice" has the meaning specified in Section 7.4(i).

        "QIB" or "Qualified Institutional Buyer" means a "qualified institutional buyer," as that term is defined in Rule 144A under the Securities Act of 1933, as amended.

        "Quarterly Interest Period" shall mean the quarterly period commencing on each March 15, June 15, September 15 and December 15 and ending on the day before the following Interest Payment Date.

        "Qualified Proceeds" means property or assets that are used, usable or useful in, or a majority of the Voting Stock of any Person engaged in, a Related Business; provided that the fair market value of any such assets or Capital Stock shall be determined by the Board in good faith.

        "Receivable" means a right to receive payment arising from a sale or lease of goods or services by a Person pursuant to an arrangement with another Person pursuant to which such other Person is obligated to pay for goods or services under terms that permit the purchase of such goods and services on credit, as determined in accordance with GAAP.

        "Receivables Entity" means (x) any Receivables Subsidiary or (y) any other Person that is engaged in the business of acquiring, selling, collecting, financing or refinancing Receivables,

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accounts (as defined in the Uniform Commercial Code as in effect in any jurisdiction from time to time), other accounts and/or other receivables, and/or related assets.

        "Receivables Fees" means distributions or payments made directly or by means of discounts with respect to any participation interest issued or sold in connection with, and other fees paid to a Person that is not a Restricted Subsidiary of NAVL in connection with, any Receivables Financing.

        "Receivables Financing" means any financing of Receivables of the Company or any Restricted Subsidiary that have been transferred to a Receivables Entity in a Financing Disposition.

        "Receivables Subsidiary" means a Subsidiary of the Company that (a) is engaged solely in the business of acquiring, selling, collecting, financing or refinancing Receivables, accounts (as defined in the Uniform Commercial Code as in effect in any jurisdiction from time to time) and other accounts and receivables (including any thereof constituting or evidenced by chattel paper, instruments or general intangibles), all proceeds thereof and all rights (contractual and other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and (b) is designated as a "Receivables Subsidiary" by the Board.

        "Receivables Repurchase Obligation" means any obligation of a seller of receivables to repurchase receivables (including Receivables, accounts (as defined in the Uniform Commercial Code as in effect in any jurisdiction from time to time) and other accounts and receivables (including any thereof constituting or evidenced by chattel paper, instruments or general intangibles)) arising as a result of a breach of a representation, warranty or covenant or otherwise, including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, off-set or counterclaim of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller.

        "Redemption Date" with respect to any Debentures, means the date on which such Debentures are redeemed by the Company.

        "Redemption Notice" has the meaning specified in Section 7.3.

        "refinance" means refinance, refund, replace, renew, repay, modify, restate, defer, substitute, supplement, reissue, resell or extend (including pursuant to any defeasance or discharge mechanism); and the terms "refinances," "refinanced" and "refinancing" as used for any purpose in this Debenture Certificate shall have a correlative meaning.

        "Refinancing Indebtedness" means Indebtedness that is Incurred to refinance any Indebtedness existing on the Issue Date or Incurred in compliance with this Debenture Certificate (including Indebtedness of the Company that refinances Indebtedness of any Restricted Subsidiary (to the extent permitted in this Debenture Certificate) and Indebtedness of any Restricted Subsidiary that refinances Indebtedness of another Restricted Subsidiary) including Indebtedness that refinances Refinancing Indebtedness; provided, that (1) if, the Indebtedness being refinanced is Junior Securities, the Refinancing Indebtedness has an Average Life at the time such Refinancing Indebtedness is Incurred that is equal to or greater than the Average Life of the Indebtedness being refinanced, (2) such Refinancing Indebtedness is Incurred in an aggregate principal amount (or if issued with original issue discount, an aggregate issue price) that is equal to or less than the sum of (x) the aggregate principal amount (or if issued with original issue discount, the aggregate accreted value) then outstanding of the Indebtedness being refinanced, plus (y) fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such Refinancing Indebtedness and (3) Refinancing Indebtedness shall not include Indebtedness of the Company or a Restricted Subsidiary that refinances Indebtedness of an Unrestricted Subsidiary.

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        "Related Business" means those businesses in which the Company or any of its Subsidiaries is engaged on the Issue Date, or that are related, complementary, incidental or ancillary thereto or extensions, developments or expansions thereof.

        "Related Dividends" has the meaning set forth in Section 3.4.

        "Residual Principal" has the meaning set forth in Section 3.4.

        "Resolution" has the meaning specified in the recitals of the Certificate of Designation.

        "Restricted Subsidiary" means any Subsidiary of the Company (or in the case of NAVL, of NAVL) other than an Unrestricted Subsidiary of such Parent.

        "Securities Act" means the Securities Act of 1933, as amended.

        "Senior Credit Agreement" means the credit agreement dated as of the Issue Date, 1999, among NAVL, any other Subsidiaries of the Company party thereto from time to time, the banks and other financial institutions party thereto from time to time, Banc of America Securities LLC, as syndication agent, and The Chase Manhattan Bank as collateral agent and administrative agent, as such agreement may be assumed by any successor in interest, and as such agreement may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, whether with the original agent and lenders or other agents and lenders or otherwise, and whether provided under the original Senior Credit Agreement or otherwise).

        "Senior Credit Facility" means the collective reference to the Senior Credit Agreement, any Loan Documents (as defined therein), any notes and letters of credit issued pursuant thereto and any guarantee and collateral agreement, patent and trademark security agreement, mortgages, letter of credit applications and other guarantees, pledge agreements, security agreements and collateral documents, and other instruments and documents, executed and delivered pursuant to or in connection with any of the foregoing, in each case as the same may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, whether with the original agent and lenders or other agents and lenders or otherwise, and whether provided under the original Senior Credit Agreement or one or more other credit agreements, indentures (including the Indenture) or financing agreements or otherwise). Without limiting the generality of the foregoing, the term "Senior Credit Facility" shall include any agreement (i) changing the maturity of any Indebtedness incurred thereunder or contemplated thereby, (ii) adding Subsidiaries of the Company as additional borrowers or guarantors thereunder, (iii) increasing the amount of Indebtedness incurred thereunder or available to be borrowed thereunder or (iv) otherwise altering the terms and conditions thereof.

        "Senior Discount Notes" means (1) the Indebtedness of the Company under the Senior Discount Loan Agreement, with an initial accreted value of $35.0 million in the aggregate, and (2) the 16% Senior Discount Notes of the Company due 2009 issued or to be issued under the Senior Discount Note Indenture, in exchange or substitution for Indebtedness under the Senior Discount Loan Agreement, together with any Exchange Notes (as defined in the Senior Discount Note Indenture) and any Additional Notes.

        "Senior Discount Loan Agreement" means the Loan Agreement, dated as of the Issue Date, among the Company and Blue Ridge Investments, LLC and The Chase Manhattan Bank, N.A. as initial Lenders thereunder, as such Loan Agreement may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, and whether

18

provided under the original Loan Agreement or one or more other credit agreements, indentures or financing agreements or otherwise).

        "Senior Discount Note Indenture" means the Indenture between the Company and the relevant Trustee, pursuant to which Senior Discount Notes are issued, as such Indenture may be amended, supplemented, waived or otherwise modified from time to time, or refunded, refinanced, restructured, replaced, renewed, repaid, increased or extended from time to time (whether in whole or in part, and whether provided under the original Senior Discount Note Indenture or one or more other credit agreements, indentures or financing agreements or otherwise).

        "Senior Indebtedness" means the following obligations, whether outstanding on the date of this Debenture or thereafter issued:

        (i)    the Designated Senior Indebtedness;

        (ii)   all obligations consisting of the principal of and premium, if any, and accrued and unpaid interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company regardless of whether post-filing interest is allowed in such proceeding) in respect of (A) all other Indebtedness of the Company or (B) all Indebtedness evidenced by notes, debentures, bonds or other similar instruments for the payment of which the Company is responsible or liable.

        (iii)  all Capital Lease Obligations of the Company;

        (iv)  all obligations of the Company (A) for the reimbursement of any obligor on any letter of credit, banker's acceptance or similar credit transaction, (B) under Interest Rate Agreements and Currency Hedging Arrangements or (C) issued or assumed as the deferred purchase price of property and all conditional sale obligations of the Company and all obligations of the Company under any title retention agreement;

        (v)   all obligations of other Persons of the type referred to in clauses (i), (ii) (iii) and (iv) and all dividends of other Persons for the payment of which, in either case, the Company is responsible or liable, directly or indirectly, as obligor, guarantor or otherwise, including guarantees of such obligations and dividends; and

        (vi)  all obligations of the Company consisting of modifications, renewals, extensions, replacements, refinancings and refundings of any obligations described in clauses (i), (ii), (iii), (iv) or (v);

unless, in the instrument creating or evidencing the same or pursuant to which the same is outstanding, it is expressly provided that such obligations are not superior in right of payment to this Note; provided, however, that Senior Indebtedness shall not include (1) Debentures or any other junior subordinated exchange debentures of the Company issued on the date hereof of identical terms as this Debenture (or other debentures of like terms issued by the Company in exchange for such debentures (upon a transfer or otherwise) or in lieu of a payment in cash pursuant to Article 1 or Article 4 of such debentures), (2) any accounts payable or other liability to trade creditors arising in the ordinary course of business (including Guarantees thereof or instruments evidencing such liabilities) or (3) any Capital Stock of the Company.

        "Senior Securities" has the meaning specified in paragraph (b)(iii) of the Certificate of Designation.

        "Significant Subsidiary" means any Restricted Subsidiary that would be a "significant subsidiary" of the Company within the meaning of Rule 1-02 under Regulation S-X promulgated by the SEC, as in effect on the Issue Date.

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        "S&P" means Standard & Poor's Ratings Service, a division of The McGraw-Hill Companies, Inc., and its successors.

        "Special Redemption Price" has the meaning specified in Section 7.1(b).

        "Standard Receivable Obligations" means representations, warranties, covenants, indemnities and other obligations (including Guarantees and Indebtedness) that are reasonably customary in connection with a Financing Disposition (as determined by the Company in good faith), including, without limitation, those relating to the servicing of the assets of a Receivables Entity, it being understood that any Receivables Repurchase Obligation shall be deemed to be a Standard Receivable Obligation

        "Stated Amount" means, as to any Debenture at any time, (A) with respect to any Dividend Payment Date, the "Stated Amount," as defined in the Certificate of Designation, of the Junior Preferred Stock for which such Debenture was exchanged as of such time, and (B) with respect to any Interest Payment Date, the sum of: (i) the Principal Amount of such Debenture as of such time, plus (ii) the amount of any accrued and unpaid interest with respect to such Debenture..

        "Stated Maturity" means, with respect to any security, the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the happening of any contingency).

        "Subsidiary" of any Person means any corporation, association, partnership or other business entity of which more than 50% of the total voting power of shares of Capital Stock or other equity interests (including partnership interests) entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by (i) such person or (ii) one or more Subsidiaries of such Person.

        "Successor Company" has the meaning specified in Section 6.1.

        "Trade Payables" means, with respect to any Person, any accounts payable or any indebtedness or monetary obligation to trade creditors created, assumed or guaranteed by such Person arising in the ordinary course of business in connection with the acquisition of goods or services.

        "Transactions" means, collectively, the Allied Acquisition, the offering and issuance of the Notes and the Senior Discount Notes, the initial borrowings under the Senior Credit Facility and the Interim Loan Facility, the issuance by the Company of Capital Stock as part of the consideration for the Allied Acquisition, and all other related transactions.

        "Transfer" unless the context otherwise requires, any sale, assignment, pledge or other disposition of any security, or of any interest therein, which could constitute a "sale" as that term is defined in Section 2(3) of the Securities Act.

        "Unrestricted Subsidiary" means for the Company or NAVL, respectively, (i) any Subsidiary of such Parent that at the time of determination is an Unrestricted Subsidiary, as designated by the Board in the manner provided below, and (ii) any Subsidiary of an Unrestricted Subsidiary of such Parent. The Board may designate any Subsidiary of such Parent (including any newly acquired or newly formed Subsidiary of such Parent) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of, or owns or holds any Lien on any property of, NAVL or any other Restricted Subsidiary of NAVL that is not a Subsidiary of the Subsidiary to be so designated. The Board may designate any Unrestricted Subsidiary of such Parent to be a Restricted Subsidiary of such Parent; provided, that immediately after giving effect to such designation either (x) the Company or NAVL could incur at least $1.00 of additional

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Indebtedness under paragraph 6.2(A) or (y) the Consolidated Coverage Ratio of the Company or NAVL would be greater than it was immediately prior to giving effect to such designation. Any such designation by the Board shall be evidenced by an Officer's Certificate certifying that such designation complied with the foregoing provisions.

        "Voting Stock" of an entity means all classes of Capital Stock of such entity then outstanding and normally entitled to vote in the election of directors or all interests in such entity with the ability to control the management or actions of such entity.

ARTICLE 3
PAYMENTS

        Section 3.1    Payments.    (a) Subject to Article 4 and to the extent permitted by the Senior Indebtedness, the Company will pay all sums becoming due on this Debenture by the method and at the address specified for such purpose in Section 3.1(b) without the presentation or surrender of this Debenture or, subject to the next sentence, the making of any notation hereon, except that, if paid in full, this Debenture shall be surrendered to the Company as a condition to such payment and shall be cancelled and shall not be reissued. Upon any partial prepayment of this Debenture, the Holder shall endorse hereon the amount and date of such partial prepayment, provided that the Holder's failure to do so shall not affect the Company's obligations under this Debenture.

        (b)   All cash payments due hereunder shall be made by (i) check mailed to the principal office of the Holder in set forth in Section 8.6 (or such other location of its principal office from time to time) or (ii) wire transfer of immediately available funds prior to 1:00 p.m., New York City time, on the due date for payment thereof to such bank account as shall be designated by the Holder to the Company in writing at least five (5) Business Days prior to the due date for such payment. Any cash payment due hereunder on a day that is not a Business Day shall be made on the first Business Day following the due date for such payment.

        (c)   The Company shall have the right to prepay this Debenture in full or in part as hereinafter provided in Article 7.

        Section 3.2    Nothing herein contained shall in any way or under any circumstances be construed or deemed to require the Company to pay or set apart for payment any cash interest on Debentures at any time.

        Section 3.3    Accrued Interest may be paid at any time, without reference to any regular Interest Payment Date, to the Holders of record on such date, not more than 45 days prior to the payment thereof, as may be fixed by the Board of Directors.

        Section 3.4    No full dividends shall be declared by the Board of Directors or paid or funds set apart for payment of dividends by the Company on any Parity Securities for any period (A) during which a Mandatory Redemption Event exists and (B) unless all accrued interest (and accumulated and unpaid dividends on the Junior Preferred Stock for which such Debentures were exchanged ("Related Dividends") (or Principal Amount in respect thereof ("Residual Principal")) shall have been or contemporaneously are paid in full, or a sum in cash set apart sufficient for such payment, on the Debentures (and in respect of Junior Preferred Stock for which the Debentures were exchanged) for all Interest Periods and Dividend Periods terminating on or prior to the date of payment of such full dividends on such Parity Securities. If any interest or Related Dividends or Residual Principal are not paid in full, as aforesaid, upon the Debentures (including for this purpose in respect of any related Junior Preferred Stock for which such debentures were exchanged) and any other Parity Securities, all interest and dividends and Related Principal declared and paid upon the Debentures (including in respect of such Junior Preferred Stock) and any other Parity Securities shall be declared pro rata so that the amount of interest and dividends and Related Principal declared and paid upon the

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Debentures (including in respect of such Junior Preferred Stock) and such Parity Securities shall in all cases bear to each other the same ratio that accrued interest and dividends and Related Principal per Debentures (including in respect of such Junior Preferred Stock) and such Parity Securities bear to each other.

        Section 3.5    (a) The Holders of Debentures shall be entitled to receive accrued interest in preference to and in priority over any dividends upon any of the Junior Securities, as and to the extent provided in Sections 3.6 and 3.7.

        (b)   So long as any Debentures are outstanding, the Company shall not declare, pay or set apart for payment any dividend on any of the Junior Securities, or make any distribution in respect thereof, for (1) any period during which a Mandatory Redemption Event or Interest Default exists and (2) any period prior to a Public Offering unless all accrued interest (and any Related Dividends or Residual Principal) shall have been or contemporaneously are paid in full, or a sum in cash set apart sufficient for such payment, on the Debentures (and in respect of Junior Preferred Stock for which the Debentures were exchanged) for all Interest Periods and Dividend Periods terminating on or prior to the date of payment of such dividends on such Junior Securities.

        Section 3.6    At any time that an Interest Default or Mandatory Redemption Event exists, so long as any Debentures are outstanding, the Company shall not make any payment on account of, or set apart for payment money for a sinking or other similar fund for, the purchase, redemption or other retirement of, any of the Junior Securities or any warrants, rights, calls or options exercisable for or convertible into any of the Junior Securities, either directly or indirectly, and whether in cash, obligations or shares of the Company or other property, and shall not permit any corporation or other entity directly or indirectly controlled by the Company to purchase or redeem any of the Junior Securities or any such warrants, rights, calls or options.

        Section 3.7    At any time that a Interest Default or Mandatory Redemption Event exists, so long as any Debentures are outstanding, the Company shall not make any payment on account of, or set apart for payment money for a sinking or other similar fund for, the purchase, redemption or other retirement of, any of the Parity Securities or any warrants, rights, calls or options exercisable for or convertible into any of the Parity Securities, and shall not permit any corporation or other entity directly or indirectly controlled by the Company to purchase or redeem any of the Parity Securities or any such warrants, rights, calls or options.

ARTICLE 4
SUBORDINATION

        Section 4.1    Agreement To Subordinate.    The Company agrees and, by accepting this Debenture, the Holder acknowledges and agrees that the Indebtedness evidenced by this Debenture is subordinated in right of payment, to the extent and in the manner provided in this Article 4, to the prior payment in full of all Senior Indebtedness and that the subordination is for the benefit of and enforceable by the holders of Senior Indebtedness.

        Section 4.2    Additional Debentures.    Without limiting the provisions regarding interest payments in Article 1, unless and until the Senior Indebtedness shall have been fully and indefeasibly paid and satisfied in cash, the Company at its option may pay any amounts due hereunder in additional Debentures.

        Section 4.3    Designated Senior Indebtedness.    (a) Except as set forth in clause (b) below, the Holder will not accelerate, ask, demand, sue for, take or receive from the Company, by set off or in any other manner, the whole or any part of the principal of, or premium, if any, on this Debenture, including without limitation the taking of any negotiable instruments evidencing such amounts, nor any

22

security for any such amounts (other than additional Debentures), unless and until all of the Designated Senior Indebtedness shall have been fully and indefeasibly paid and satisfied in cash.

        (b)   Prior to the occurrence of a default with respect to any Designated Senior Indebtedness, and provided that the payment described below, if made, would be permitted to be made under all Senior Indebtedness, the Company may pay to the Holder, and the Holder may accept from the Company, regularly scheduled payments of interest, when due, on an unaccelerated basis, pursuant to this Debenture.

        Section 4.4    Liquidation, Dissolution, Bankruptcy.    Upon any payment or distribution of the assets of the Company to creditors upon a total or partial liquidation or a total or partial dissolution of the Company or in a bankruptcy, reorganization, insolvency, receivership or similar proceeding relating to the Company or its property:

(i)

holders of Senior Indebtedness shall be entitled to receive payment in full in cash of the Senior Indebtedness before the Holder shall be entitled to receive any payment of principal of, or premium, if any, or interest on this Debenture; and



(ii)

until the Senior Indebtedness is paid in full in cash, any payment or distribution to which the Holder would be entitled but for this Article 4 shall be made to holders of Senior Indebtedness as their interests may appear.

        Section 4.5    Default on Senior Indebtedness.    Without limiting the provisions regarding Designated Senior Indebtedness in Section 4.3, the Company may not pay the principal of, premium, if any, or interest on, this Debenture or otherwise purchase or retire this Debenture (collectively, "pay this Debenture") if (i) any Senior Indebtedness is not paid when due, (ii) the maturity of such Senior Indebtedness is accelerated in accordance with its terms or (iii) any default exists under any Senior Indebtedness.

        Section 4.6    Acceleration of Payment of Debenture.    Except as permitted by any Senior Indebtedness, the Holder will not accelerate for any reason the scheduled maturities of any amount owing in respect of this Debenture or the indebtedness which it represents.

        Section 4.7    When Distribution Must Be Paid Over.    If a distribution is made to the Holder that because of this Article 4 should not have been made to it, the Holder agrees, by accepting this Debenture, that it shall hold such distribution in trust for holders of Senior Indebtedness and pay it over to them as their interests may appear.

        Section 4.8    Subrogation.    After all Senior Indebtedness is paid in full in cash and until this Debenture is paid in full, the Holder shall be subrogated to the rights of holders of Senior Indebtedness to receive distributions applicable to Senior Indebtedness. A distribution made under this Article 4 to holders of Senior Indebtedness which otherwise would have been made to the Holder is not, as between the Company and the Holder, a payment by the Company on Senior Indebtedness.

        Section 4.9    Relative Rights.    This Article 4 defines the relative rights of the Holder and holders of Senior Indebtedness. Nothing in this Debenture shall:

(i)

impair, as between the Company and the Holder, the obligation of the Company, which is absolute and unconditional, to pay principal of, premium, if any, and interest on this Debenture in accordance with its terms; or



(ii)

prevent the Holder from exercising its available remedies upon a Default, subject to any provisions of Senior Indebtedness relating thereto.

        Section 4.10    Subordination May Not Be Impaired by Company.    No right of any holder of Senior Indebtedness to enforce the subordination of the Indebtedness evidenced by this Debenture shall be impaired by any act or failure to act by the Company or by its failure to comply with this Debenture.

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        Section 4.11    Reliance by Holders of Senior Indebtedness on Subordination Provisions.    The Holder by accepting this Debenture acknowledges and agrees that the foregoing subordination provisions are, and are intended to be, an inducement and a consideration to each holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after the issuance of this Debenture, to acquire and continue to hold, or to continue to hold, such Senior Indebtedness and such holder of Senior Indebtedness shall be deemed conclusively to have relied on such subordination provisions in acquiring and continuing to hold, or in continuing to hold, such Senior Indebtedness.

ARTICLE 5
DEFAULTS AND REMEDIES

        Section 5.1    Events of Default.    An "Event of Default" occurs if:

        (a)   the Company defaults in any payment of interest on any Debenture when due, whether or not such payment shall be prohibited by Article 4, and such default continues for a period of 30 days;

        (b)   the Company defaults in the payment of the principal of any Debenture when the same becomes due at its Stated Maturity, upon optional redemption, upon required purchase, upon declaration of acceleration or otherwise, whether or not such payment shall be prohibited by Article 4;

        (c)   the Company fails to comply with Section 6.1 and such failure continues for 30 days after the notice specified in the penultimate paragraph of this Section 5.1;

        (d)   the Company fails to comply with Section 7.4 (other than a failure to purchase the Debentures), and such failure continues for 30 days after the notice specified in the penultimate paragraph of this Section 5.1;

        (e)   the Company fails to comply with any of its agreements in this Debenture Certificate (other than those referred to in (a), (b), (c) and (d) above) and such failure continues for 60 days after the notice specified in the penultimate paragraph of this Section 5.1;

        (f)    the Company or any Significant Subsidiary fails to pay any Indebtedness within any applicable grace period after final maturity or the acceleration of any such Indebtedness by the holders thereof because of a default if the total amount of such Indebtedness unpaid or accelerated exceeds $15,000,000 or its foreign currency equivalent;

        (g)   the Company or any Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:

        (1)   commences a voluntary case;

        (2)   consents to the entry of an order for relief against it in an involuntary case;

        (3)   consents to the appointment of a Custodian of it or for any substantial part of its property; or

        (4)   makes a general assignment for the benefit of its creditors;

        (h)   a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

        (1)   is for relief against the Company or any Significant Subsidiary in an involuntary case;

        (2)   appoints a Custodian of the Company or any Significant Subsidiary or for any substantial part of its property; or

        (3)   orders the winding up or liquidation of the Company or any Significant Subsidiary;

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and the order or decree remains unstayed and in effect for 60 days; or

        (i)    there is rendered any judgment or decree for the payment of money in an amount (net of any insurance or indemnity payments actually received within 90 days from the entry thereof, or to be received in respect thereof in the event any appeal thereof shall be unsuccessful) in excess of $15,000,000 or its foreign currency equivalent against the Company or any Significant Subsidiary by a court or other adjudicatory authority of competent jurisdiction that is not discharged, or bonded or insured by a third Person, if such judgment or decree remains outstanding for a period of 90 days following such judgment or decree and is not discharged, waived or stayed.

        The foregoing will constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body.

        The term "Bankruptcy Law" means Title 11, United States Code, or any similar Federal, state or foreign law for the relief of debtors. The term "Custodian" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.

        A Default under clause (c), (d) or (e) is not an Event of Default until the Holders of at least 25% in principal amount of the Debentures notify the Company of the Default and the Company does not cure such Default within the time specified therein after receipt of such notice. Such notice must specify the Default, demand that it be remedied and state that such notice is a "Notice of Default." When a Default or an Event of Default is cured, it ceases.

        The Company shall deliver to the Holders, within 30 days after the occurrence thereof, written notice in the form of an Officer's Certificate of any Event of Default under clause (f) or (i) and any event that with the giving of notice or the lapse of time would become an Event of Default under clause (c), (d) or (e), its status and what action the Company is taking or proposes to take with respect thereto.

        Section 5.2    Acceleration of Maturity; Rescission and Annulment.    If an Event of Default (other than an Event of Default specified in clause (g) or (h) of Section 5.1 with respect to the Company) occurs and is continuing, the Holders of at least a majority in principal amount of the outstanding Debentures by notice to the Company, specifying in such notice the respective Event of Default and that such notice is a "notice of acceleration," may, but only in the event that all Designated Senior Indebtedness shall first have been paid in full, declare the principal of and accrued but unpaid interest on all the Notes to be due and payable. Upon the effectiveness of such a declaration, such principal and interest will be due and payable immediately. Notwithstanding the foregoing, if an Event of Default specified in clause (g) or (h) of Section 5.1 with respect to the Company occurs and is continuing, then the principal of and any accrued interest on all the outstanding Debentures will ipso facto become and be immediately due and payable without any declaration or other act on the part of any Holder. The Holders of a majority in principal amount of the outstanding Debentures by notice to the Company may rescind an acceleration and its consequences if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except non-payment of principal or interest that has become due solely because of such acceleration. No such rescission shall affect any subsequent Default or impair any right consequent thereto.

        Notwithstanding the foregoing, in the event of a declaration of acceleration in respect of the Notes because an Event of Default specified in clause (f) of Section 5.1 shall have occurred and be continuing, such declaration of acceleration of the Debentures and such Event of Default and all consequences thereof (including without limitation any acceleration or resulting payment default) shall be annulled, waived and rescinded, automatically and without any action by the Holders, and be of no further effect, if within 60 days after such Event of Default arose (x) the Indebtedness that is the basis

25

for such Event of Default has been discharged, or (y) the holders thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving rise to such Event of Default, or (z) the default in respect of such Indebtedness that is the basis for such Event of Default has been cured.

        Section 5.3    Other Remedies; Collection Suit by Trustee.    If an Event of Default occurs and is continuing, and irrespective of whether any Debentures have become or have been declared immediately due and payable under Section 5.2, the Holder of any Debenture then outstanding may, but only in the event that all Designated Senior Indebtedness shall first have been paid in full, proceed to pursue any available remedy to collect the payment of principal of or interest on the Debentures or to enforce the performance of any provision of the Debentures or this Debenture Certificate.

        Section 5.4    Application of Money Collected.    Any money collected by any Holder pursuant to this Article 5 shall be applied in the following order, and, in case of the distribution of such money on account of principal (or premium, if any) or interest, upon presentation of the Debentures and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:

First: to holders of Senior Indebtedness to the extent required by Article 4;

Second: to the payment of the amounts then due and unpaid upon the Debentures for principal (and premium, if any) and interest, in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Notes for principal (and premium, if any) and interest, respectively; and

Third: to the Company.

        Section 5.5    Rights and Remedies Cumulative.    No right or remedy herein conferred upon or reserved to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

        Section 5.6    Delay or Omission Not Waiver.    No delay or omission of any Holder of any Debenture to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article 5 or by law to the Holders may be exercised from time to time, and as often as may be deemed expedient by the Holders, but only in the event that all Designated Senior Indebtedness shall first have been paid in full.

        Section 5.7    Waiver of Past Defaults.    The Holders of not less than a majority in aggregate principal amount of the outstanding Debentures may on behalf of the Holders of all the Debentures waive any past Default hereunder and its consequences, except a Default

        (a)   in the payment of the principal of (or premium, if any) or interest on any Debenture (which may only be waived with the consent of each Holder of Debentures affected), or

        (b)   in respect of a covenant or provision hereof that pursuant to the second paragraph of Section 8.4(b) cannot be modified or amended without the consent of the Holder of each outstanding Debenture affected.

        Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Debenture Certificate; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon. In case of any such waiver, the Company, any other obligor upon the Debentures

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and the Holders shall be restored to their former positions and rights hereunder and under the Debentures, respectively.

ARTICLE 6
COVENANTS

        Section 6.1    Merger or Consolidation.    (A) Without the consent of the Holders of a majority of the outstanding aggregate Principal Amount of Debentures (including consents obtained in connection with a tender offer or exchange offer for the Debentures) (the "Majority Holders"), the Company will not consolidate with or merge with or into, or convey, transfer or lease all or substantially all its assets to, any Person, unless: (1) the resulting, surviving or transferee Person (the "Successor Company") will be a Person organized and existing under the laws of the United States of America, any State thereof or the District of Columbia and the Successor Company (if not the Company) will expressly assume all the obligations of the Company under the Debentures and this Agreement by executing and delivering to the Holders a supplemental agreement or one or more other documents or instruments in form reasonably satisfactory to the Holders; (2) immediately after giving effect to such transaction (and treating any Indebtedness that becomes an obligation of the Successor Company or any Restricted Subsidiary as a result of such transaction as having been Incurred by the Successor Company or such Restricted Subsidiary at the time of such transaction) no Mandatory Redemption Event will have occurred and be continuing; and (4) the Company will have obtained an Officer's Certificate and an Opinion of Counsel, each to the effect that such consolidation, merger or transfer complies with this paragraph 6.1(A), provided that (x) in giving such opinion such counsel may rely on an Officer's Certificate as to compliance with the foregoing clauses (2) and (3) and as to any matters of fact, and (y) no Opinion of Counsel will be required for a consolidation, merger or transfer described in paragraph 6.1(B) below. Any Indebtedness that becomes an obligation of the Company or any Restricted Subsidiary (or that is deemed to be Incurred by any Restricted Subsidiary that becomes a Restricted Subsidiary) as a result of any such transaction undertaken in compliance with this Section 6.1, and any Refinancing Indebtedness with respect thereto, shall be deemed to have been Incurred in compliance with Section 6.3.

        (B)  Paragraph 6.1(A) above shall not apply to any transaction in which (1) any Restricted Subsidiary consolidates with, merges into or transfers all or part of its assets to the Company or (2) the Company consolidates or merges with or into or transfers all or substantially all its properties and assets to (x) an Affiliate incorporated or organized for the purpose of reincorporating or reorganizing the Company in another jurisdiction or changing its legal structure to a corporation or other entity or (y) a Restricted Subsidiary of the Company so long as all assets of the Company and the Restricted Subsidiaries immediately prior to such transaction (other than Capital Stock of such Restricted Subsidiary) are owned by such Restricted Subsidiary and its Restricted Subsidiaries immediately after the consummation thereof.

        (D)    Successor Company Substituted.    Upon any transaction involving the Company in accordance with Section 6.1(A)-(C), in which the Company is not the Successor Company, the Successor Company will succeed to, and be substituted for, and may exercise every right and power of, the Company under this Debenture Certificate, and thereafter the predecessor Company shall be relieved of all obligations and covenants under this Debenture Certificate.

        Section 6.2    Junior Payments.    (A) Without the consent of the Majority Holders, the Company shall not, and shall not permit any Restricted Subsidiary, directly or indirectly, to (i) declare or pay any dividend or make any distribution on or in respect of any Junior Securities of the Company, including any such payment in connection with any merger or consolidation to which the Company is a party, except (x) dividends or distributions payable solely in its Capital Stock (other than Disqualified Stock) and (y) dividends or distributions payable to the Company or any Restricted Subsidiary, or (ii) purchase, redeem, retire or otherwise acquire for value, prior to scheduled maturity, scheduled

27

repayment or scheduled sinking fund payment, any Junior Securities of the Company held by Persons other than the Company or any Restricted Subsidiary (other than a purchase, redemption, retirement, or other acquisition for value in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of such acquisition) (any such dividend, distribution, purchase, redemption, retirement or other acquisition being herein referred to as a "Junior Payment"), if at the time the Company or such Restricted Subsidiary makes such Junior Payment:

        (1)   a Mandatory Redemption Event shall have occurred and be continuing (or would result therefrom);

        (2)   NAVL could not incur at least an additional $1.00 of Indebtedness pursuant to paragraph 6.3(A) below; or

        (3)   the aggregate amount of such Junior Payment and all other Junior Payments (the amount so expended, if other than in cash, to be as determined in good faith by the Board, whose determination shall be conclusive) declared or made subsequent to the Issue Date and then outstanding would exceed the sum of:

        (a)   50% of the Consolidated Net Income of the Company or (if greater) of NAVL accrued during the period (treated as one accounting period) from September 30, 1999 to the end of the most recent fiscal quarter ending prior to the date of such Junior Payment for which consolidated financial statements of the Company or NAVL, as the case may be, are available (or, in case each such Consolidated Net Income shall be a negative number, 100% of the smaller such negative number); and

        (b)   the aggregate Net Cash Proceeds and the fair market value of Qualified Proceeds received (x) by the Company as capital contributions to the Company after the Issue Date or from the issuance or sale (other than to a Restricted Subsidiary) of its Capital Stock (other than Disqualified Stock) after the Issue Date or (y) by the Company or any Restricted Subsidiary from the issuance and sale by the Company or any Restricted Subsidiary after the Issue Date of Indebtedness that shall have been converted into or exchanged for Capital Stock of the Company (other than Disqualified Stock), plus the amount of cash and the fair market value of Qualified Proceeds received by the Company or any Restricted Subsidiary upon such conversion or exchange.

        (B)  The provisions of the foregoing paragraph 6.2(A) will not prohibit any of the following (each, a "Permitted Payment"):

        (1)   any purchase, redemption, retirement or other acquisition of Capital Stock of the Company made by exchange (including any such exchange pursuant to the exercise of a conversion right or privilege in connection with which cash is paid in lieu of the issuance of fractional shares) for, or conversion into, or out of the proceeds of the substantially concurrent issuance or sale of, Capital Stock of the Company (other than Disqualified Stock and other than Capital Stock issued or sold to a Subsidiary) or out of the proceeds of a substantially concurrent capital contribution to the Company; provided, that the Net Cash Proceeds from such issuance, sale or capital contribution shall be excluded in subsequent calculations under clause (3)(b) of the preceding paragraph 6.2(A);

        (2)   any purchase, redemption, retirement or other acquisition of Junior Securities (x) made by exchange for, or out of the proceeds of the substantially concurrent issuance or sale of, Refinancing Indebtedness Incurred in compliance with Section 6.3 below or (y) to the extent required by the agreement governing such Junior Securities following the occurrence of a Change of Control, but only if in each case, the Company shall have complied with Section 7.4 and, if required, purchased Debentures tendered pursuant to an Offer to purchase such Debentures required thereby, prior to purchasing or repaying such Junior Securities;

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        (3)   dividends paid within 60 days after the date of declaration thereof if at such date of declaration such dividend would have complied with the preceding paragraph 6.2 (A);

        (4)   payments to repurchase or otherwise acquire Capital Stock (including any options, warrants or other rights in respect thereof), in each case from Management Investors, such payments not to exceed an amount (net of repayments of any such loans or advances equal to (a) $12.5 million plus (b) $2.5 million multiplied by the number of calendar years that have commenced since the Issue Date plus (c) the Net Cash Proceeds received by the Company or NAVL since the Issue Date from, or as a capital contribution from, the issuance or sale of Capital Stock (including any options, warrants or other rights in respect thereof), to the extent such Net Cash Proceeds are not included in any calculation under clause (3)(b)(x) of the preceding paragraph 6.2(A);

        (5)   the payment of dividends on the common stock or equity of the Company following a public offering of such common stock or equity, in an amount not to exceed in any fiscal year 6% of the aggregate gross proceeds received by the Company in or from such public offering;

        (6)   Junior Payments (including loans or advances) in an aggregate amount outstanding at any time not to exceed $10.0 million (net of repayments of any such loans or advances);

        (7)   payments to satisfy obligations under the Management Agreements to pay any Holding Expenses;

        (8)   payments to holders of Capital Stock of the Company in lieu of issuance of fractional shares of such Capital Stock, not to exceed $100,000 in the aggregate outstanding at any time;

        (9)   the distribution, as a dividend or otherwise, of Investments in Unrestricted Subsidiaries;

        (10) the Transactions;

        (11) any purchase, redemption, retirement or other acquisition of Capital Stock that may be deemed to occur upon exercise of stock options, warrants or similar rights to the extent such Capital Stock represents all or part of the exercise price thereof; and

        (12) Junior Payments by any Restricted Subsidiary that are permitted by the Senior Credit Facility or any Indenture;

provided, that (A) in the case of clauses (3) and (5), the net amount of any such Permitted Payment shall be included in subsequent calculations of the amount of Junior Payments, (B) in the case of clause (4), 50% of the amount of any such Permitted Payment shall be included in subsequent calculations of the amount of Junior Payments, (C) in the case of clause (12), the net amount of any such Permitted Payment shall be included in subsequent calculations of the amount of Junior Payments to the extent that such net amount is required under each Indenture to be included in concurrent calculations of the amount of Restricted Payments (as defined in such Indenture) under Section 4.08 of the Note Indenture, Section 4.08 of the Senior Discount Note Indenture and Section 6.7 of the Senior Discount Loan Agreement, (D) in all cases other than pursuant to clauses (A), (B) and (C) immediately above, the net amount of any such Permitted Payment shall be excluded in subsequent calculations of the amount of Junior Payments and (E) with respect to clauses (5) and (6), no Mandatory Redemption Event shall have occurred or be continuing at the time of any such Permitted Payment after giving effect thereto.

        Section 6.3    Limitation on Indebtedness.    (A) Without the consent of the Majority Holders, the Company will not, and will not permit any Restricted Subsidiary to, Incur any Indebtedness; provided, however, that (1) the Company or any Restricted Subsidiary may Incur Indebtedness if on the date of

29

the Incurrence of such Indebtedness, after giving effect to the Incurrence thereof, the Consolidated Coverage Ratio of the Company would be greater than 1.75:1.00 if such Indebtedness is Incurred on or prior to December 1, 2001 or 2.00:1.00 if such Indebtedness is Incurred thereafter and (2) NAVL or any Note Guarantor may Incur Indebtedness if on the date of the Incurrence of such Indebtedness, after giving effect to the Incurrence thereof, the Consolidated Coverage Ratio of NAVL would be greater than 2.00:1.00 if such Indebtedness is Incurred on or prior to December 1, 2001 or 2.25:1.00 if such Indebtedness is Incurred thereafter.

        (B)  Notwithstanding the foregoing paragraph 6.3(A), the Company and its Restricted Subsidiaries may Incur the following Indebtedness:

        (1)   Indebtedness Incurred pursuant to Credit Facilities (including but not limited to in respect of letters of credit or bankers' acceptances issued or created thereunder) and (without limiting the foregoing) any Refinancing Indebtedness in respect thereof, in a maximum principal amount at any time outstanding (giving effect to any refinancing thereof) not exceeding in the aggregate the amount equal to the sum of (x) $475.0 million and (y) the aggregate amount by which the Borrowing Base determined as of the date of such Incurrence exceeds $245.0 million (plus in the case of any refinancing of any Credit Facility or any portion thereof, the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing);

        (2)   Indebtedness (a) of any Restricted Subsidiary to the Company or (b) of the Company or any Restricted Subsidiary to any Restricted Subsidiary; provided, that any subsequent issuance or transfer of any Capital Stock of such Restricted Subsidiary to which such Indebtedness is owed, or other event, that results in such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of such Indebtedness (except to the Company or a Restricted Subsidiary) will be deemed, in each case, an Incurrence of such Indebtedness by the issuer thereof;

        (3)   Indebtedness represented by the Exchange Debentures, the Notes and the Senior Discount Notes (other than Additional Notes), any Indebtedness (other than the Indebtedness described in clauses (1) or (2) above) outstanding on the Issue Date and any Refinancing Indebtedness Incurred in respect of any Indebtedness described in this clause (3) or paragraph 6.3(A) above;

        (4)   Purchase Money Obligations and Capitalized Lease Obligations, and any Refinancing Indebtedness with respect thereto, in an aggregate principal amount at any time outstanding (giving effect to any refinancing thereof) not exceeding an amount equal to the greater of (x) $35.0 million and (y) 5% of Consolidated Tangible Assets;

        (5)   Indebtedness of any Person that is assumed by the Company or any Restricted Subsidiary in connection with its acquisition of assets from such Person or any Affiliate thereof or is issued and outstanding on or prior to the date on which such Person was acquired by the Company or any Restricted Subsidiary or merged or consolidated with or into any Restricted Subsidiary (other than Indebtedness Incurred to finance, or otherwise in connection with, such acquisition), provided that on the date of such acquisition, merger or consolidation, after giving effect thereto, NAVL could Incur at least $1.00 of additional Indebtedness pursuant to paragraph 6.3(A) above; and any Refinancing Indebtedness with respect to any such Indebtedness;

        (6)   (a) Guarantees by the Company or any Restricted Subsidiary of Indebtedness or any other obligation or liability of the Company or any Restricted Subsidiary (other than any Indebtedness incurred by the Company or such Restricted Subsidiary, as the case may be, in violation of this paragraph 6.3), or (b) Indebtedness of the Company or any Restricted Subsidiary arising by reason of any Lien granted by or applicable to such Person securing Indebtedness of the

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Company or any Restricted Subsidiary (other than any Indebtedness incurred by the Company or such Restricted Subsidiary, as the case may be, in violation of this Section 6.3);

        (7)   Indebtedness of the Company or any Restricted Subsidiary (a) arising from the honoring of a check, draft or similar instrument of such Person drawn against insufficient funds, provided that such Indebtedness is extinguished within five Business Days of its incurrence, or (b) consisting of guarantees, indemnities, obligations in respect of earnouts or other purchase price adjustments, or similar obligations, Incurred in connection with the acquisition or disposition of any business, assets or Person (including pursuant to the Allied Acquisition);

        (8)   Indebtedness of the Company or any Restricted Subsidiary in respect of (a) letters of credit, bankers' acceptances or other similar instruments or obligations issued, or relating to liabilities or obligations incurred, in the ordinary course of business (including those issued to governmental entities in connection with self-insurance under applicable workers' compensation statutes), or (b) completion guarantees, surety, judgment, appeal or performance bonds, or other similar bonds, instruments or obligations, provided, or relating to liabilities or obligations incurred, in the ordinary course of business, or (c) Hedging Obligations entered into for bona fide hedging purposes in the ordinary course of business, (d) Management Guarantees, (e) Agent Guarantees in an aggregate principal amount not exceeding $10.0 million outstanding at any time, or (f) the financing of insurance premiums in the ordinary course of business;

        (9)   Indebtedness of a Receivables Subsidiary secured by a Lien on all or part of the assets disposed of in, or otherwise incurred in connection with, a Financing Disposition, which Indebtedness is, except for Standard Receivables Obligations, otherwise without recourse to NAVL or any Restricted Subsidiary (other than any Receivables Subsidiary);

        (10) Indebtedness of a Foreign Subsidiary of the Company or NAVL if, on the date of Incurrence of such Indebtedness, after giving effect to the Incurrence thereof, (x) the Consolidated Coverage Ratio of the Company or NAVL would be at least 2.25:1.00 and (y) if, as a result of such Incurrence, such Foreign Subsidiary shall then become subject to any restriction or limitation (under any agreement or instrument governing such Indebtedness) on its ability to pay dividends or make other distributions to NAVL, the Foreign Subsidiary Coverage Ratio of the Company or NAVL would be greater than 2.75:1.00; provided, that if such Indebtedness is not incurred pursuant to the preceding clause (y), such Indebtedness shall not be amended, modified or otherwise supplemented such that such Foreign Subsidiary will become subject to any such restriction or limitation referred to in such clause unless such Indebtedness could then be Incurred pursuant to such clause; and any Refinancing Indebtedness with respect to any such Indebtedness;

        (11) Indebtedness of the Company or any Restricted Subsidiary in an aggregate principal amount at any time outstanding (giving effect to any refinancing thereof) not exceeding an amount equal to $95.0 million;

        (12) Indebtedness of any Restricted Subsidiary that is permitted to be Incurred under the Senior Credit Facility or any Indenture; and

        (13) Indebtedness under the Interim Loan Facility, in an aggregate principal amount not to exceed $40.0 million outstanding at any time.

        (C)  For purposes of determining compliance with, and the outstanding principal amount of any particular Indebtedness Incurred pursuant to and in compliance with, this covenant, (i) any other obligation of the obligor on such Indebtedness (or of any other Person who could have Incurred such Indebtedness under this covenant) arising under any Guarantee, Lien or letter of credit, bankers' acceptance or other similar instrument or obligation supporting such Indebtedness shall be disregarded to the extent that such Guarantee, Lien or letter of credit, bankers' acceptance or other similar instrument or obligation secures the principal amount of such Indebtedness; (ii) in the event that

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Indebtedness meets the criteria of more than one of the types of Indebtedness described in paragraph 6.3(B) above, the Company, in its sole discretion, shall classify such item of Indebtedness and only be required to include the amount and type of such Indebtedness in one of such clauses; and (iii) the amount of Indebtedness issued at a price that is less than the principal amount thereof shall be equal to the amount of the liability in respect thereof determined in accordance with GAAP.

        (D)  For purposes of determining compliance with any Dollar-denominated restriction on the Incurrence of Indebtedness denominated in a foreign currency, the Dollar-equivalent principal amount of such Indebtedness Incurred pursuant thereto shall be calculated based on the relevant currency exchange rate in effect on the date that such Indebtedness was Incurred, in the case of term Indebtedness, or first committed, in the case of revolving credit Indebtedness, provided that (x) the Dollar-equivalent principal amount of any such Indebtedness outstanding on the Issue Date shall be calculated based on the relevant currency exchange rate in effect on the Issue Date, (y) if such Indebtedness is Incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable Dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such Dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced and (z) the Dollar-equivalent principal amount of Indebtedness denominated in a foreign currency and Incurred pursuant to the Senior Credit Facility shall be calculated based on the relevant currency exchange rate in effect on, at the Company's option, (i) the Issue Date, (ii) any date on which any of the respective commitments under the Senior Credit Facility shall be reallocated between or among facilities or subfacilities thereunder, or on which such rate is otherwise calculated for any purpose thereunder, or (iii) the date of such Incurrence. The principal amount of any Indebtedness Incurred to refinance other Indebtedness, if Incurred in a different currency from the Indebtedness being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such respective Indebtedness is denominated that is in effect on the date of such refinancing.

        Section 6.4    Withholding.    Notwithstanding any other provision of this Debenture Certificate, in the event that the Company makes any tax payment in respect of any Debenture or share of Junior Preferred Stock for which such Debenture was exchanged (including but not limited to any withholding tax payment made by the Company under Chapter 3 of Subtitle A of the Code):

        (A)  if the tax payment is in respect of a cash interest payment or distribution made on such Debenture or share, the amount of such cash payment or distribution paid to the Holder of such Debenture or share shall be reduced by the amount of such tax payment, provided that for all purposes hereof the Holder of such Debenture or share shall be treated as having received the amount of such tax payment as part of such cash payment or distribution and as having paid over such tax payment to the taxing authority to which it was paid; and

        (B)  if the tax payment is not in respect of a cash interest payment or distribution made on such Debenture or share (or exceeds a cash payment or distribution made on such Debenture or share), the Principal Amount of such Debenture as of the time of such tax payment shall be reduced by the amount of such tax payment (or the amount of such excess) through an increase (without duplication) in the Adjustment Amount.

If and to the extent that a Holder of any Debenture remits cash to the Company for the specified purpose of funding a tax payment to be made by the Company in respect of such Debenture or share, and such cash is received by the Company prior to the time that the Company makes such tax payment, then such tax payment shall be disregarded for purposes of the preceding sentence. If requested by any Holder of any Debenture, the Company shall consult in good faith with such Holder concerning the Company's obligations to make any tax payments in respect of such Debenture.

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ARTICLE 7
PREPAYMENT OF NOTE; CHANGE OF CONTROL OFFER; SPECIAL PREPAYMENT

        Section 7.1.    Optional Prepayment.    (a) The Company may (subject to the legal availability of funds therefor), at the option of the Company, redeem at any time on or after the first anniversary of the Issue Date, from any source of funds legally available therefor, in whole or in part, in the manner provided in Section 7.3 hereof, any or all of the Debentures, at a redemption price for any such Debenture equal to the sum of (i) the product of (A) the Principal Amount of such Debenture as of the applicable Redemption Date, multiplied by (B) the percentage set forth below with respect to such Redemption Date, plus (ii) without duplication, an amount in cash equal to all interest accrued and unpaid with respect to the Principal Amount of such Debenture to the Redemption Date (collectively, the "Optional Redemption Price"):

PERIOD	PERCENTAGE
12-month period commencing on the first anniversary of the Issue Date	103	%
12-month period commencing on the second anniversary of the Issue Date	102	%
12-month period commencing on the third anniversary of the Issue Date	101	%
Thereafter	100	%

        (b)   In addition, in the event a Change of Control of the Company is consummated at any time prior to the first anniversary of the Issue Date, the Company may redeem (subject to contractual and other restrictions with respect thereto and the legal availability of funds therefor), in the manner provided in Section 7.3 hereof, all of but not less than all of the outstanding Debentures at a redemption price for each Debenture equal to 103% of the Principal Amount of such Debenture as of the applicable Redemption Date thereof, plus, without duplication, an amount in cash equal to all interest accrued and unpaid with respect to the Principal Amount of the Debentures to the Redemption Date (collectively, the "Special Redemption Price").

        (c)   In the event of a redemption of only a portion of the then outstanding Debentures, the Company shall effect such redemption as it determines, pro rata, according to the number of Debentures held by each Holder of the Debentures or by lot, as may be determined by the Company in its sole discretion.

        Section 7.2    Mandatory Repayments.    Upon the existence and continuance for at least 180 days of any Mandatory Redemption Event (other than a Mandatory Redemption Event pursuant to clause (1) of the definition thereof) or upon the existence and continuance of a Dividend Default for four consecutive quarterly periods, the Company shall redeem (subject to the Debt Agreements (including the availability of funds by dividend from NAVL in compliance therewith), and to the legal availability of funds therefor) in the manner provided in Section 7.3 hereof, each Debenture then outstanding at a redemption price equal to the Principal Amount of such Debenture as of the applicable Redemption Date, plus, without duplication, an amount in cash equal to all interest accrued and unpaid to the Redemption Date (collectively, the "Mandatory Redemption Price").

        7.3    Procedures for Optional Redemption and Mandatory Redemption.    (a) At least 30 days and not more than 60 days prior to the date fixed for any redemption of the Debentures, written notice (the "Redemption Notice") shall be given by first-class mail, postage prepaid, to each Holder of record on the record date fixed for such redemption of the Debentures at such Holder's address as the same appears on the Register, provided that no failure to give such notice nor any deficiency therein shall affect the validity of the procedure for the redemption of any Debentures to be redeemed except as to

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the Holder or Holders to whom the Company has failed to give said notice or except as to the Holder or Holders whose notice was defective. The Redemption Notice shall state:

(i)

whether the redemption is pursuant to Section 7.1(A), 7.1(B), 7.2 or 7.5 hereof;



(ii)

the Optional Redemption Price, the Special Redemption Price, the Mandatory Redemption Price, or the Residual Prepayment Price (as defined in Section 7.5), as the case may be;



(iii)

whether all or less than all the outstanding Debentures are to be redeemed and the total Principal Amount of Debentures being redeemed;



(iv)

the number of Debentures held, as of the appropriate record date, by the Holder that the Company intends to redeem;



(v)

the date fixed for redemption;



(vi)

that the Holder is to surrender to the Company, at the place or places where certificates for Debentures are to be surrendered for redemption, in the manner and at the price designated, the certificate or certificates representing the Debentures to be redeemed; and



(vii)

that interest on the Debentures to be redeemed shall cease to accrue on the Redemption Date unless the Company defaults in the payment of the Optional Redemption Price, the Special Redemption Price or the Mandatory Redemption Price, as the case may be.

        (b)   On or prior to the date fixed for redemption, each Holder of Debentures shall surrender the certificate or certificates representing such Debentures to the Company, duly endorsed, in the manner and at the place designated in the Redemption Notice, and on the Redemption Date, the full Optional Redemption Price, the Special Redemption Price or Mandatory Redemption Price, as the case may be, for such Debentures shall be payable in cash to the Person whose name appears on such certificate or certificates as the owner thereof, and each surrendered certificate shall be canceled and retired. In the event that less than all of the Debentures represented by any such certificate are redeemed, a new certificate shall be issued representing the unredeemed Debentures.

        (c)   If the funds of the Company legally available for redemption of Debentures on any Redemption Date are insufficient to redeem the total number of Debentures to be redeemed on such date, or if a complete redemption is not permitted by any Debt Agreement (or any Debt Agreement does not permit NAVL to Debentures sufficient legally available funds to the Company to effect a complete redemption), those funds which are legally available shall be used to redeem the maximum possible number of Debentures of the Holders to the extent permitted by each Debt Agreement and to the extent NAVL is permitted under each Debt Agreement to dividend an equal amount of funds to the Company out of funds legally available therefor. At any time thereafter when additional funds of the Company are legally available for the redemption of Debentures, such funds shall immediately be used to redeem the balance of the Debentures which the Company has become obligated to redeem, on any Redemption Date but which it has not redeemed, to the extent permitted by each Debt Agreement and to the extent NAVL is permitted under each Debt Agreement to dividend an equal amount of funds to the Company out of funds legally available therefor.

        (d)   Unless the Company defaults in the payment in full of the applicable redemption price, interest on the Debentures called for redemption shall cease to accrue on the Redemption Date, and the Holders of such Debentures shall cease to have any further rights with respect thereto on the Redemption Date, other than the right to receive the Optional Redemption Price, the Special Redemption Price or the Mandatory Redemption Price, as the case may be, without interest.

        Section 7.4    Change of Control.

        (i)    Unless otherwise consented to by the Majority Holder, upon the occurrence after the Issue Date of a Change of Control, each Holder of Debentures then outstanding, subject to the other

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provisions of this Section 7.4, shall have the right (subject to the Debt Agreements (including the availability of funds by dividend from NAVL in compliance therewith), and to the legal availability of funds therefor) to require the Company to purchase any or all of such Holder's Debentures pursuant to an offer (an "Offer") at a purchase price per share in cash equal to 101% of the Principal Amount of such Debenture at the purchase date, plus, without duplication, an amount in cash equal to all accrued and unpaid interest with respect to the Principal Amount of such Debenture to the purchase date (collectively, the "Change of Control Purchase Price"). Unless the Company has exercised its right to redeem the Debentures as described under Section 7.1 above, the Company shall, not later than 30 days following the date the Company obtains actual knowledge of any Change of Control having occurred, mail a notice (the "Purchase Notice") to each Holder of record stating: (1) that a Change of Control has occurred or may occur and that such Holder has, or upon such occurrence will have, the right (subject to the Debt Agreements (including the availability of funds by dividend from NAVL in compliance therewith), and to the legal availability of funds therefor) to require the Company to purchase any or all of such Holder's Debentures at a purchase price per Debenture in cash equal to 101% of the Principal Amount thereof on the relevant Purchase Date, plus, without duplication, an amount in cash equal to all accrued and unpaid interest, if any, with respect to such Debenture; (2) the circumstances and relevant facts and financial information regarding such Change of Control; (3) the date fixed for such purchase (which shall be no earlier than 30 days nor later than 60 days from the date such notice is mailed); (4) the instructions determined by the Company, consistent with this Section 7.4, that a Holder must follow in order to have its Debentures purchased; and (5) if such notice is mailed prior to the occurrence of a Change of Control, that such Offer is conditioned on the occurrence of such Change of Control.

        (ii)   Holders of Debentures electing to have Debentures purchased shall be required to surrender the certificate or certificates representing such Debentures, duly endorsed, to the Company in the manner and at the address specified in the Purchase Notice at least three Business Days prior to the date fixed for such purchase. On the Purchase Date, the Change of Control Purchase Price for such Debentures shall become payable in cash to the Person whose name appears on such certificate or certificates as the owner thereof. In the event that less than all of the shares represented by any such certificate are purchased, a new certificate shall be issued representing the shares not purchased.

        (iii)  If the funds of the Company legally available for any purchase of Debentures under this Section 7.4 on any Purchase Date are insufficient to purchase the aggregate amount of Debentures to be purchased on such date or if a complete purchase is not permitted by any Debt Agreement (or any Debt Agreement does not permit NAVL to dividend sufficient legally available funds to the Company to effect a complete purchase), those funds which are legally available shall be used to purchase the maximum possible number of shares of the Holders to the extent permitted by each Debt Agreement and to the extent NAVL is permitted to dividend an equal amount of funds to the Company under each Debt Agreement out of funds legally available therefor. At any time thereafter when additional funds of the Company are legally available for the purchase of shares, such funds shall immediately be used to purchase the balance of the amount of Debentures which the Company has become obligated to purchase on any Purchase Date but which it has not purchased, to the extent permitted by each Debt Agreement and to the extent NAVL is permitted to dividend an equal amount of funds to the Company under each Debt Agreement out of funds legally available therefor.

        (iv)  Unless the Company defaults in the payment in full of the applicable Change of Control Purchase Price, interest on the Debentures tendered for purchase shall cease to accrue on the date fixed for such purchase, and the Holders of such Debentures shall cease to have any further rights with respect thereto on the such date, other than the right to receive the Change of Control Purchase Price without interest.

        (v)   The Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the purchase of

35

Debentures pursuant to this Section 7.4. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 7.4, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Section 7.4 by virtue thereof.

        (vi)  Notwithstanding any other provision of this Section 7.4, the Company shall not be required to purchase any Debentures under this Section 7.4, (A) unless NAVL is required to purchase or repay the outstanding Notes and Senior Discount Notes pursuant to the Indentures and has offered to purchase or repay in full all of the outstanding Notes and Senior Discount Notes and has so purchased or repaid in full all of the outstanding Notes and Senior Discount Notes of each holder of any Note or Senior Discount Note who has accepted such offer and (B) unless the principal of and all accrued and unpaid interest on all indebtedness under the Senior Credit Facility, and all other monetary obligations owing in respect of the Senior Credit Facility, shall have been paid in full, and all letters of credit, bankers acceptances and similar instruments outstanding thereunder shall have expired undrawn.

        Section 7.5.    Special Prepayment.    The Company may (subject to the legal availability of funds therefor), at the option of the Company, redeem at any time, from any source of funds legally available therefor, in whole or in part, in the manner provided in Section 7.3 hereof, any portion of the Principal Amount of the Debentures in an amount that does not exceed the Residual Principal, at a redemption price for any such Debenture equal to the portion of the Principal Amount of the Debentures to be redeemed, plus accrued and unpaid interest on such portion of the Principal Amount to be redeemed (collectively, the "Residual Prepayment Price").

ARTICLE 8
OTHER PROVISIONS OF GENERAL APPLICATION

        Section 8.1    Loss, Theft, Destruction or Mutilation of Debenture.

        Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Debenture, and of indemnity or security reasonably satisfactory to the Company, and upon reimbursement to the Company of all reasonable expenses incidental thereto, and upon surrender and cancellation of this Debenture, if mutilated, the Company will make and deliver a new Debenture of like tenor, in lieu of this Debenture. Any Debenture made and delivered in accordance with the provisions of this Section 8.1 shall be dated the date hereof.

        Section 8.2    Governing Law.

        This Debenture shall be construed in accordance with and governed by the law of the State of New York.

        Section 8.3    Maintenance of Register; Restriction on Transfer; Successors and Assigns.    (a) The Company will keep at its principal office in Fort Wayne, Indiana (or such other location of its principal office from time to time) a register (the "Register") in which the Company will provide for the registration and transfer of the Debenture and will record the name of, and address for notices to, the Holder. The Company and any agent of the Company may treat the Person in whose name this Debenture is registered as the owner of such Debenture for the purpose of receiving payment of the principal amount of this Debenture and interest on the unpaid balance of such principal amount and for all other purposes, whether or not this Debenture be overdue, and neither the Company nor any such agent shall be affected by notice to the contrary.

        (b)   Upon surrender of this Debenture for registration of transfer or for exchange to the Company at its principal office set forth above, the Company at its expense (except for transfer taxes, if any) will execute and deliver in exchange therefor a new Debenture. Such new Debenture shall (A) have an aggregate principal amount equal to the principal amount of the surrendered Debenture, (B) be registered in each case in such name as such holder or transferee may request, and (C) be dated as of

36

the semi-annual interest payment date coinciding with or immediately preceding the date of such surrender.

        (c)   By accepting this Debenture, the Holder acknowledges and agrees that: (i) the Debenture has not been registered under the Securities Act or any other applicable securities laws and may not be sold or transferred in the absence of such registration or an exemption therefrom under said Act and any other applicable securities laws and (ii) the Debenture may not be transferred, sold, pledged, hypothecated or otherwise disposed of unless (A) the Company shall have consented to such disposition in writing, such consent not to be unreasonably withheld, (B) such disposition is in whole and not in part, (C) (x) such disposition is pursuant to an effective registration statement under the Securities Act, (y) the Holder shall have delivered to the Company a written opinion of counsel, which opinion and counsel shall be reasonably satisfactory to the Company, to the effect that such disposition is exempt from the provisions of Section 5 of such Act and (if applicable) any other applicable securities laws or (z) a no-action letter from the Securities and Exchange Commission, reasonably satisfactory to the Company, shall have been obtained with respect to such disposition, and (D) such disposition is pursuant to registration under any applicable state securities laws or an exemption therefrom. Any other purported transfer of the Debenture by the Holder shall be void and without force and effect.

        (d)   All the covenants, stipulations, promises and agreements contained in this Debenture shall bind the successors and assigns of the Company and the Holder and shall inure to the benefit of the successors and permitted assigns of the Company and the Holder, whether so expressed or not.

        Section 8.4    Amendment.    (a) Without Consent of Holders.    Without the consent of the Holders of any Debentures, the Company may enter into one or more amendments supplemental hereto, for any of the following purposes:

        (a)   to cure any ambiguity, omission, defect or inconsistency,

        (b)   to provide for the assumption by a successor of the obligations of the Company under this Debenture Certificate,

        (c)   to provide for uncertificated Debentures in addition to or in place of certificated Debentures,

        (d)   to add Guarantees with respect to the Debentures, to secure the Debentures, to confirm and evidence the release, termination or discharge of any Guarantee or Lien with respect to or securing the Debentures when such release, termination or discharge is provided for under this Debenture Certificate,

        (e)   to add to the covenants of the Company for the benefit of the Holders of the Debentures or to surrender any right or power conferred upon the Company,

        (f)    to provide that any Indebtedness that becomes or will become an obligation of a Successor Company pursuant to a transaction governed by Article 6 (and that is not a Subordinated Obligation) is Senior Subordinated Indebtedness or Guarantor Senior Subordinated Indebtedness for purposes of this Debenture Certificate,

        (g)   to provide for or confirm the issuance of Additional Debentures,

        (h)   to make any change that does not adversely affect the rights of any Holder under the Debentures or this Debenture Certificate or

        (i)    to make any Conforming Change (as defined in Section 8.4(e) below).

        (b)    With Consent of Holders.    The Company may amend or supplement this Debenture Certificate or the Debentures with the written consent of the Majority Holders (including consents obtained in connection with a tender offer or exchange offer for Debentures), and the Majority

37

Holders (including by consents obtained in connection with a tender offer or exchange offer for Debentures) may waive any existing Default or Event of Default or compliance by the Company with any provision of this Debenture Certificate or the Debentures.

        Notwithstanding the provisions of this Section 8.4(b), without the consent of each Holder affected, an amendment or waiver, including a waiver pursuant to Article 5, may not:

        (i)    reduce the principal amount of the Debentures whose Holders must consent to an amendment or waiver;

        (ii)   reduce the rate of or extend the time for payment of interest on any Debenture;

        (iii)  reduce the principal or extend the Stated Maturity of any Debenture;

        (iv)  reduce the premium payable upon the redemption of any Debenture or change the date on which any Debenture may be redeemed as described in Section 6.1;

        (v)   make any Debenture payable in money other than that stated in the Debenture;

        (vi)  make any change in Article 4 that adversely affects the rights of any Holder in any material respect;

        (vii) impair the right of any Holder to receive payment of principal of and interest on such Holder's Debentures on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Holder's Debentures; or

        (viii) make any change in the amendment or waiver provisions described in this sentence.

        Notwithstanding Section 8.4(a) and the foregoing provisions of this Section 8.4(b), no amendment to Article 4 of this Debenture Certificate or the definitions relating thereto that adversely affects the rights of any Holder of Senior Indebtedness at the time outstanding (which Senior Indebtedness has been previously designated in writing by the Company to the Holders for this purpose) may be made unless the holders of such Senior Indebtedness (or any group or representative thereof authorized to give a consent) consent in writing to such amendment.

        It shall not be necessary for the consent of the Holders under this Section 8.4(b) to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof.

        After an amendment, supplement or waiver under this Section 8.4(b) becomes effective, the Company shall mail to the Holders of each Debenture affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity or effectiveness of any such amendment, supplement or waiver.

        (c)    Revocation and Effect of Consents.    Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder and every subsequent Holder of that Debenture or any Debenture that evidences all or any part of the same debt as the consenting Holder's Debenture, even if notation of the consent is not made on any Debenture. Subject to the following paragraph of this Section 8.4(c), any such Holder or subsequent Holder may revoke the consent as to such Holder's Debenture by notice to the Company received by the Company before the date on which the Holders receive an Officer's Certificate certifying that the Holders of the requisite principal amount of Debentures have consented (and not theretofore revoked such consent) to the amendment, supplement or waiver. The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment, supplement or waiver.

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        After an amendment, supplement or waiver becomes effective, it shall bind every Holder of Debentures, unless it makes a change described in any of clauses (i) through (viii) of the second paragraph of Section 8.4(b). In that case, the amendment, supplement or waiver shall bind each Holder of a Debenture who has consented to it and every subsequent Holder of such Debenture or any Debenture that evidences all or any part of the same debt as the consenting Holder's Debenture.

        (d)    Notation on or Exchange of Notes.    If an amendment, supplement or waiver changes the terms of a Debenture, the Company may request the Holder of the Debenture to deliver it to the Company. The Company shall place an appropriate notation on the Debenture about the changed terms and return it to the Holder. Alternatively, if the Company so determines, the Company shall issue in exchange for the Debenture a new Debenture that reflects the changed terms. Failure to make the appropriate notation or issue a new Debenture shall not affect the validity and effect of such amendment, supplement or waiver.

        (e)   "Conforming Change" means, in the event any provision of the Credit Agreement or any Indenture is amended or waived in accordance with its terms and if any provision in Article 5 or 6 or Section 7.4 of this Debenture is substantially similar to such amended or waived provision in such other agreement, any amendment or waiver hereunder made (or deemed made in the case of a waiver) in like manner and to the same extent.

        (f)    Any term of this Debenture may only be amended or waived in accordance with this Section 8.4, and any amendment or waiver effected in accordance with this Section 8.4 shall be binding upon the Holder and the Company, whether or not (in the case of an amendment or waiver affecting this Debenture) the substance of such amendment or waiver is thereafter incorporated on the face of this Debenture Certificate.

        Section 8.5    Headings.

        The headings of the articles and sections of this Debenture Certificate are inserted for convenience only and shall not be deemed to constitute a part hereof.

        Section 8.6    Notices.

        Any notice or other communication under this Debenture shall be in writing and shall be deemed to have been duly given or made (i) when delivered by hand, (ii) four Business Days after it is sent by express, registered or certified mail, return receipt requested, postage prepaid, or (iii) one Business Day after it is sent by nationally recognized overnight courier, in each case addressed as follows:

(a)

if to the Holder, at the address set forth below or to such other address as the Holder shall have furnished to the Company in writing:

Attention:

(b)

if to the Company, at the address set forth below or to such other address as the Company shall have furnished to the Holder in writing:

SIRVA, INC.
700 Oakmont Lane
Westmont, Illinois 60559
Attention: President

with a copy to:

Debevoise & Plimpton
919 Third Avenue
New York, NY 10022
Attention:

        Section 8.7    Provisions for the Benefit of Third Parties.

        The provisions of Article 4 of this Debenture are for the benefit of the holders from time to time of Senior Indebtedness, and their Representative shall be entitled to enforce such provisions on their behalf. Except as set forth in the preceding sentence, nothing in this Debenture shall confer any rights upon any Person other than the Company and the Holder and their respective successors and permitted assigns.

39

        IN WITNESS WHEREOF, SIRVA, Inc. has caused this Debenture to be signed in its corporate name by a duly authorized officer and to be dated as of the day and year first above written.

SIRVA, INC.
By
	Name:
	Title:

40

DEBENTURE (cont'd)

PREPAYMENTS

Date
Amount of
Principal Prepaid Notation Made By

41

Annex B to Certificate
of Designation for
Junior Preferred Stock

[FORM OF TRANSFER NOTICE]

To assign this Certificate, fill in the form below:

        I or we assign and transfer the shares represented by this Certificate in compliance with the exemption from registration under the Securities Act of 1933, as amended, provided by Rule 144A thereunder to

(Print or type assignee's name, address and zip code)

(Insert assignee's soc. sec. or tax I.D. No.)

and irrevocably appoint

agent to transfer such shares on the books of the Company. The agent may substitute another to act for him.

Date:
	NOTICE: The signature to this assignment must correspond with the name as written upon the face of the within-mentioned instrument in every particular, without alteration or any change whatsoever.

TO BE COMPLETED BY ASSIGNEE

        The undersigned represents and warrants that it is purchasing the shares represented by this Certificate for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act of 1933, as amended, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned's foregoing representations in order to claim the exemption from registration provided by Rule 144A.

Dated:
	NOTICE:	To be executed by an executive officer

42

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RESTATED CERTIFICATE OF INCORPORATION OF SIRVA, INC.

EX-23.2

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Exhibit 23.2

CONSENT OF INDEPENDENT ACCOUNTANTS

        We hereby consent to the use in this Registration Statement on Form S-1 of our report dated February 7, 2003, except as to Notes 19, 20, and 23, for which the date is August 15, 2003, relating to the financial statements and financial statement schedule of SIRVA, Inc., which appear in such Registration Statement. We also consent to the references to us under the heading "Experts" in such Registration Statement.

/s/ PricewaterhouseCoopers LLP
Chicago, Illinois
November 12, 2003

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CONSENT OF INDEPENDENT ACCOUNTANTS