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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): MARCH 4, 1998
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 1-13647 73-1356520
(STATE OR OTHER JURISDICTION OF (COMMISSION FILE NUMBER) (I.R.S. EMPLOYER
INCORPORATION) IDENTIFICATION NO.)
5330 EAST 31ST STREET, TULSA, OKLAHOMA 74135
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (918) 660-7700
FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT: N/A
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ITEM 5. OTHER EVENTS
On March 4, 1998, the registrant, Dollar Thrifty Automotive Group,
Inc., a Delaware corporation ("Company"), completed the establishment of a $615
million commercial paper facility ("Commercial Paper Facility") which will
provide vehicle fleet financing for the ongoing operations of the Company's
wholly-owned operating subsidiaries, Dollar Rent A Car Systems, Inc., an
Oklahoma corporation ("Dollar"), and Thrifty Rent-A-Car System, Inc., an
Oklahoma corporation ("Thrifty"). The commercial paper will be issued by the
Company's wholly-owned finance subsidiary, Dollar Thrifty Funding Corp., an
Oklahoma corporation ("DTFC"). While DTFC will issue the commercial paper
notes, it will actually use the proceeds to purchase a variable funding note
("VFN") from the Company's other wholly-owned finance subsidiary, Rental Car
Finance Corp. ("RCFC"). RCFC will, in turn, use such proceeds to purchase
vehicles for lease to Dollar and Thrifty.
The commercial paper issued under the Commercial Paper Facility is
supported by collateral for the VFN. The VFN is secured by a grant to a trustee
under an indenture relating to issuance of RCFC asset backed notes (including
the VFN) of a first priority security interest in (i) the Master Motor Vehicle
Lease and Servicing Agreement among RCFC, as lessor, Dollar and Thrifty, as
lessees and servicers, and the Company, as guarantor and master servicer (the
"Lease Agreement"), and payments due thereunder covering certain vehicles that
are not collateral for other outstanding asset backed notes, (ii) a credit
enhancement letter of credit in the initial amount of $5 million (which must be
increased depending upon the amount of commercial paper issued) from Credit
Suisse First Boston which, in addition to providing credit enhancement, also
supports payments due from Dollar and Thrifty under the Lease Agreement, (iii) a
capitalization demand promissory note in the amount of $7.3 million from the
Company to RCFC relating to establishment of the Commercial Paper Facility, (iv)
through a master collateral agency arrangement (the "Master Collateral
Agreement"), vehicles leased under the Lease Agreement and all proceeds from
disposition of such vehicles, and the rights relating to the obligations of
certain approved manufacturers (the "Approved Manufacturers"), pursuant to their
manufacturing programs to repurchase or guarantee minimum resale prices of such
vehicles (the "Manufacturer Programs"), including the receivables due from the
Approved Manufacturers in connection therewith, (v) any cash or investments in
the various accounts held pursuant to the Master Collateral Agreement by a
master collateral agent related to the vehicles, and (vi) any cash or
investments in the various accounts held by the trustee allocable to the VFN.
To support the Commercial Paper Facility, DTFC entered into a secured
364-day revolving liquidity facility (the "Liquidity Facility") provided by a
syndicate of financial institutions (the "Liquidity Banks"). The aggregate
commitments under the Liquidity Facility equal $545 million. The Liquidity
Facility provides the Commercial Paper Facility with a back-up source of
funding if DTFC is unable to refinance maturing commercial paper by issuing new
commercial paper. The Liquidity Facility is secured by the same collateral for
the VFN as described in the paragraph immediately above.
The Company will use $256 million of the proceeds from the Commercial
Paper Facility to refinance the portion of RCFC's outstanding asset backed
notes which begin amortizing from September 1998 through February 1999. The
Company will use the remaining amounts available under the Commercial Paper
Facility for fleet financing and to refinance asset backed notes from time to
time. Commercial paper will be issued at interest rates prevailing in the
market at the time of issuance, or sold at a discount reflecting such rates.
In the event commercial paper cannot be reissued in the market, DTFC will use
proceeds advanced under the Liquidity Facility to repay maturing commercial
paper notes.
The Liquidity Banks will be obligated to fund loans to repay maturing
commercial paper or maturing liquidity loans. Draws under the Liquidity
Facility will be repaid with proceeds from subsequent Liquidity Facility draws
or the issuance of additional commercial paper and payments made by RCFC on the
VFN. Payments on the VFN will be made from collections of lease payments
received from Dollar and Thrifty, payments under the Manufacturer Programs, and
proceeds from the sale of Non-Program Vehicles (as defined below) and other
vehicle sale proceeds.
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At least 80% of vehicles (such vehicles, "Program Vehicles") financed
by RCFC with advances under the VFN will be eligible under Manufacturer
Programs maintained by Approved Manufacturers pursuant to which either (i) in
the case of manufacturer repurchase programs, each manufacturer will be
obligated to repurchase vehicles within designated periods of time, or (ii) in
the case of guaranteed depreciation programs, each manufacturer will reimburse
any difference between the aggregate gross auction sale price of the Program
Vehicles for a particular model year and the aggregate predetermined residual
value of those vehicles, in each case in accordance with certain terms and
conditions as contained in the Manufacturer Program.
Up to 20% of vehicles leased under the Lease Agreement and financed
with proceeds under the VFN will not have the benefit of a Manufacturer Program
(such vehicles, "Non-Program Vehicles"). Typically, Non-Program Vehicles are
purchased at a more favorable price or are specialty vehicles not eligible
under Manufacturer Programs. Additionally, RCFC may purchase Non-Program
Vehicles from Approved Manufacturers which may not offer participation in their
Manufacturer Programs to Dollar and Thrifty. At the conclusion of RCFC's use
of such vehicles, such Non-Program Vehicles will be disposed of in the
secondary vehicle market, principally through third-party vehicle auction
sites, wholesalers or dealers.
The commercial paper notes issued by DTFC were initially rated A-1 by
Standard & Poor's, P-1 by Moody's, and D-1 by Duff & Phelps. DTFC began its
initial sales of commercial paper on March 10, 1998, and has outstanding
approximately $50 million in commercial paper which matures no later than the
maximum term for any commercial paper which can be issued by DTFC, being 58
days.
The descriptions contained herein of the various agreements relating
to the Commercial Paper Facility and Liquidity Facility are qualified in their
entirety by reference to the definitive agreements dated March 4, 1998,
included herewith as Exhibits 4.12 through 4.18. In addition, the Company has
elected to include herewith certain exhibits in connection with the
Registration Statement on Form S-1, File No. 333-39661, filed with the
Securities and Exchange Commission which was declared effective on December 16,
1997. Such exhibits, which are numbered 4.10 and 4.11, relate to the Company's
existing asset backed note program, specifically notes issued by RCFC in
December 1997 in the amount of $900 million, and also include information
relating to credit support furnished by Chrysler Corporation for such issuance
of notes.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
The Exhibits to this report are listed in the Index to
Exhibits set forth elsewhere herein.
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SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
Date: March 16, 1998 By: /s/ STEVEN B. HILDEBRAND
------------------------------------------
Name: Steven B. Hildebrand
Title: Vice President, Principal Financial
Officer and Principal Accounting
Officer
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit No. Description
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<S> <C>
4.10 Amended and Restated Master Collateral Agency Agreement dated as of
December 23, 1997 among the Company, Rental Car Finance Corp.,
Thrifty, Dollar and Bankers Trust Company.
4.11 Chrysler Support Letter of Credit and Reimbursement Agreement dated
as of December 23, 1997 among Chrysler, Dollar, Thrifty, the
Company, TRAC Team, Inc. and DTAG Services, Inc.
4.12 Series 1998-1 Supplement to Base Indenture dated as of March 4,
1998 between Rental Car Finance Corp. and Bankers Trust Company.
4.13 Master Motor Vehicle Lease and Servicing Agreement dated as of
March 4, 1998 among the Company, Dollar, Thrifty and Rental Car
Finance Corp.
4.14 Note Purchase Agreement dated as of March 4, 1998 among Rental Car
Finance Corp., Dollar Thrifty Funding Corp. and Credit Suisse First
Boston.
4.15 Liquidity Agreement dated as of March 4, 1998 among Dollar Thrifty
Funding Corp., certain Financial Institutions and Credit Suisse
First Boston.
4.16 Depositary Agreement dated as of March 4, 1998 between Dollar
Thrifty Funding Corp. and Bankers Trust Company.
4.17 Collateral Agreement dated as of March 4, 1998 among Dollar Thrifty
Funding Corp., Credit Suisse First Boston Corporation and Bankers
Trust Company.
4.18 Dealer Agreement dated as of March 4, 1998 among Dollar Thrifty
Funding Corp., the Company, Credit Suisse First Boston Corporation
and Chase Securities, Inc.
</TABLE>
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EXHIBIT 4.10
[EXECUTION COPY]
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AMENDED AND RESTATED MASTER COLLATERAL AGENCY AGREEMENT
among
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
as Master Servicer,
RENTAL CAR FINANCE CORP., as a grantor,
as a Financing Source and as a Beneficiary,
THRIFTY RENT-A-CAR SYSTEM, INC.,
as a grantor and as Servicer,
DOLLAR RENT A CAR SYSTEMS, INC.,
as a grantor and as Servicer,
VARIOUS FINANCING SOURCES PARTIES HERETO,
VARIOUS BENEFICIARIES PARTIES HERETO,
and
BANKERS TRUST COMPANY,
not in its individual capacity but solely
as Master Collateral Agent
Dated as of December 23, 1997
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
Section Page
<S> <C> <C>
ARTICLE I
CERTAIN DEFINITIONS
1.1. Certain Definitions.................................................3
1.2. Cross References; Headings.........................................12
1.3. Interpretation.....................................................12
ARTICLE II
MASTER COLLATERAL AGENT AS LIENHOLDER
FOR THE BENEFICIARIES
2.1. Security Interests.................................................13
2.2. Designation of Beneficiaries; Beneficiaries' Rights Limited........17
2.3. Redesignation of Beneficiaries.....................................18
2.4. Master Servicer's Fleet Report.....................................19
2.5. Master Collateral Account..........................................19
2.6. Certificates of Title..............................................22
2.7. Notation of Liens; Release of Collateral...........................22
2.8. Power of Attorney..................................................23
ARTICLE III
THE MASTER SERVICER
3.1. Acceptance of Appointment..........................................23
3.2. Master Servicer Functions..........................................24
3.3. The Master Servicer Not to Resign..................................24
3.4. Servicing Rights of Master Collateral Agent........................25
3.5. Incumbency Certificate.............................................25
</TABLE>
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<TABLE>
<CAPTION>
Section Page
<S> <C> <C>
ARTICLE IV
THE MASTER COLLATERAL AGENT
4.1. Appointment........................................................25
4.2. Representations....................................................27
4.3. Exculpatory Provisions.............................................27
4.4. Limitations on Powers and Duties of the Master Collateral Agent....28
4.5. Resignation and Removal of Master Collateral Agent.................30
4.6. Status of Successors to Master Collateral Agent....................31
4.7. Merger of the Master Collateral Agent..............................31
4.8. Compensation and Expenses..........................................32
4.9. Stamp, Other Similar Taxes and Filing Fees.........................32
4.10. Indemnification....................................................32
ARTICLE V
MISCELLANEOUS
5.1. Amendments, Supplements and Waivers................................33
5.2. Notices............................................................33
5.3. Severability.......................................................34
5.4. Counterparts.......................................................34
5.5. Conflicts with Financing Documents; Reservation of Rights..........34
5.6. Binding Effect.....................................................35
5.7. Governing Law......................................................35
5.8. Effectiveness......................................................35
5.9. Termination of Beneficiary.........................................35
5.10. Termination of this Agreement......................................35
5.11. Assignment by Financing Sources....................................35
5.12. RCFC Related Documents.............................................36
5.13. No Bankruptcy Petition Against Financing Sources...................36
5.14. Jurisdiction; Consent to Service of Process........................36
5.15. Waiver of Jury Trial...............................................37
5.16. Insurance Notification.............................................37
</TABLE>
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<TABLE>
<CAPTION>
EXHIBITS
<S> <C>
Exhibit A Grantor Supplement
Exhibit B Financing Source and Beneficiary Supplement
Exhibit C Servicer's Fleet Report
Exhibit D Certificate of Title Locations
Exhibit E Power of Attorney
Exhibit F Assignment Agreement
Exhibit G List of New York, New York and Tulsa, Oklahoma Bank Holidays
Exhibit H Investment Standing Instruction
</TABLE>
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AMENDED AND RESTATED MASTER COLLATERAL AGENCY AGREEMENT
This AMENDED AND RESTATED MASTER COLLATERAL AGENCY AGREEMENT, dated as
of December 23, 1997 (amending and restating the Master Collateral Agency
Agreement, dated as of December 13, 1995, among Thrifty Rent-A-Car System,
Inc., an Oklahoma corporation, and the other parties named therein (the
"Original Agreement")) (as the same may be amended, supplemented, restated or
otherwise modified from time to time in accordance with the terms hereof, this
"Agreement"), among DOLLAR THRIFTY AUTOMOTIVE GROUP, INC., a Delaware
corporation as ("DTAG"), as master servicer (in such capacity, the "Master
Servicer"), RENTAL CAR FINANCE CORP., an Oklahoma corporation ("RCFC"), as a
grantor, THRIFTY RENT-A-CAR SYSTEM, INC., an Oklahoma corporation ("Thrifty"),
as a grantor and servicer, DOLLAR RENT A CAR SYSTEMS, INC., an Oklahoma
corporation ("Dollar"), as a grantor and servicer (together with Thrifty in
such capacity, the "Servicers"), such other grantors as are added pursuant to a
Grantor Supplement substantially in the form of Exhibit A hereto (such
additional grantors, together with Thrifty and Dollar, the "Lessee Grantors"),
RCFC, BANKERS TRUST COMPANY (in its capacity as trustee under the Indenture
(such term and all other capitalized terms used herein and not otherwise
defined herein having the meanings assigned thereto in Section 1.1 hereof) and
any other party which from time to time executes a Financing Source and
Beneficiary Supplement substantially in the form of Exhibit B hereto as a
Financing Source (any such party being herein called individually a "Financing
Source" and collectively, the "Financing Sources"), the Trustee, RCFC and any
other party which from time to time executes a Financing Source and Beneficiary
Supplement substantially in the form of Exhibit B hereto as a Beneficiary (any
such party being herein called individually a "Beneficiary" and collectively,
the "Beneficiaries"), and BANKERS TRUST COMPANY, not in its individual capacity
agent for the Beneficiaries (in such capacity, the "Master Collateral Agent").
BACKGROUND
1. The parties to the Original Agreement desire to amend and restate
the Original Agreement in its entirety to provide for, among other things, the
addition of DTAG as Master Servicer hereunder, the addition of Dollar and such
other grantors as may be added by the execution and delivery of a Grantor
Supplement as grantors hereunder in connection with the financing to be
provided by RCFC to Dollar and such other grantors and the acquisition of motor
vehicles by RCFC to be leased to Dollar and such other grantors (in addition to
continuing to provide financing to Thrifty and continuing to acquire motor
vehicles to be leased to Thrifty).
2. Thrifty and Dollar now own, and each of the Lessee Grantors will
from time to time hereafter acquire or lease, certain motor vehicles for use in
their respective daily domestic rental operations. RCFC will from time to time
acquire and lease to each of the Lessee Grantors certain motor vehicles for use
in their respective daily domestic rental operations.
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3. Pursuant to the Financing Documents heretofore or concurrently
herewith executed, or to be executed, by RCFC, RCFC (i) has extended financing
to Thrifty and Dollar and may from time to time extend financing to each of the
Lessee Grantors secured by, among other things, Master Collateral Vehicles and
related rights, (ii) has assigned to the Trustee, on behalf of the noteholders
of the related series of Notes, the rights of RCFC as lessor and the
obligations of Thrifty and/or Dollar as lessee(s) under each Lease heretofore
or concurrently herewith executed, and related security, and (iii) from time to
time may assign to the Trustee, on behalf of the holders of additional series
of Notes issued under the Indenture, additional rights of RCFC and obligations
of the Lessee Grantors under the Leases related to such series of Notes and/or
under other additional Financing Documents.
4. Pursuant to the Financing Documents heretofore or concurrently
herewith executed, or to be executed, by RCFC, RCFC (i) has acquired and may
from time to time acquire motor vehicles and has leased and may from time to
time lease such motor vehicles to one or more of the Lessee Grantors, and (ii)
has granted and intends and wishes to grant hereunder a security interest in
the motor vehicles acquired by it for lease under one or more of the Leases,
and in related security, to the Master Collateral Agent for the benefit of the
Trustee on behalf of the noteholders of the related series of Notes.
5. Each of the Lessee Grantors and RCFC may from time to time obtain
financing with respect to such motor vehicles acquired by it or obtain credit
enhancement to support such financing from other Persons (which Persons
providing financing or credit enhancement to any of the Lessee Grantors may
include RCFC) which are or shall hereafter become parties hereto as Financing
Sources or which are or shall hereafter be named as Beneficiaries with respect
to a Financing Source, and each Lessee Grantor is granting a security interest
in the motor vehicles and related security acquired by it with such financing
to the Master Collateral Agent hereunder for the benefit of such related
Beneficiaries.
6. Bankers Trust Company has agreed to act as Master Collateral Agent,
and in its capacity as Master Collateral Agent to be named as the lienholder on
the Certificates of Title for the vehicles in which an interest is granted
hereunder, for the benefit of the Beneficiaries from time to time.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, and other good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
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ARTICLE I
CERTAIN DEFINITIONS
SECTION 1.1. Certain Definitions. As used in this Agreement, the
following terms have the respective meanings set forth below, or set forth in
another section hereof or in any other agreement, as indicated below.
"Affiliate" means, with respect to any specified Person, another Person
that directly, or indirectly through one or more intermediaries, controls or is
controlled by or is under common control with the Person specified. For
purposes of this definition, "control" means (a) the power to direct the
management and policies of a Person, directly or indirectly, whether through
ownership of voting securities, by contract or otherwise or (b) beneficial
ownership of 10% or more of the voting common equity of a Person; and
"controlled" and "controlling" have meanings correlative to the foregoing.
"Agreement" has the meaning set forth in the preamble hereto.
"Assignment Agreement" means a Vehicle Disposition Program Assignment
Agreement, substantially in the form attached as Exhibit F hereto, or in such
other form as is acceptable to each Rating Agency, entered into or to be
entered into among RCFC and/or a Lessee Grantor, as assignor, and the Master
Collateral Agent, as assignee, and acknowledged by the applicable Manufacturer,
assigning to the Master Collateral Agent certain of RCFC's and/or such Lessee
Grantor's right, title and interest in, to and under each Vehicle Disposition
Program described therein, to the extent related to the Master Collateral
Vehicles purchased from such Manufacturer.
"Auction Procedures" means the set of procedures specified in a Vehicle
Disposition Program for sale or disposition of Program Vehicles through
auctions and at auction sites designated by such Vehicles' Manufacturer
pursuant to such Vehicle Disposition Program.
"Authorized Agents" has the meaning set forth in Section 3.5.
"Bankruptcy Code" means The Bankruptcy Reform Act of 1978, as amended
from time to time, and as codified as 11 U.S.C. Section 101 et seq.
"Beneficiary" has the meaning set forth in the preamble.
"BOK" means the Bank of Oklahoma, National Association, a national
banking association.
"Business Day" means any day other than (i) a Saturday or Sunday, or
(ii) any other day on which commercial banking institutions in New York, New
York, Tulsa, Oklahoma and in the city in which the Corporate Trust Office is
located are authorized or obligated by law or executive
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order to be closed. The attached Exhibit G, to be updated each December 31st
by the Master Servicer, lists the bank holidays in New York, New York and
Tulsa, Oklahoma, or (iii) in connection with any Financing Document, any other
day not designated as a "Business Day" in such Financing Document.
"Capitalized Cost" means, with respect to a Master Collateral Vehicle,
unless otherwise specified in the Financing Documents of the related Financing
Source (in which event "Capitalized Cost" shall have such specified meaning),
the Initial Acquisition cost of such Master Collateral Vehicle, less any
Incentive Payments used to reduce the Initial Acquisition cost of such Master
Collateral Vehicle, in accordance with the applicable Manufacturer incentive
program or generally accepted accounting principles, and due from the
Manufacturer with respect to such Master Collateral Vehicle.
"Certificate of Title" means, with respect to each Master Collateral
Vehicle, the certificate of title applicable to such Master Collateral Vehicle
duly issued in accordance with the certificate of title act or statute of the
jurisdiction applicable to such Master Collateral Vehicle.
"Chrysler" means Chrysler Corporation, a Delaware corporation.
"Closing Date" means, with respect to any Financing Source, the closing
date or date of issuance with respect to the indebtedness created thereunder,
as specified in the related Financing Documents.
"Corporate Trust Office" means the principal corporate trust office of
the Master Collateral Agent, located, on the date of the execution of this
Agreement, at 4 Albany Street, 10th Floor, New York, New York 10006, Attn:
Corporate Trust and Agency Group Attn: (Structured Finance) or at such other
address as the Master Collateral Agent may designate from time to time by
notice to Thrifty.
"DCR" means Duff & Phelps Credit Rating Co.
"Default" means any event of default or amortization event or any
default or any event, act or condition which with the lapse of time or notice
or both would become an event of default or amortization event (other than any
scheduled amortization event) under any of the Financing Documents.
"Depreciation Charge" means with respect to any Master Collateral
Vehicle which is a Related Vehicle of a Beneficiary, Depreciation Charge as
defined in the Financing Documents related to such Beneficiary, and if
Depreciation Charge is not defined in such Financing Documents, "Depreciation
Charge" means, for any date of determination, (a) with respect to any Program
Vehicle, the scheduled daily depreciation charge set forth by the Manufacturer
in its Vehicle Disposition Program for such Master Collateral Vehicle
calculated as set forth in such Vehicle Disposition Program, and (b) with
respect to any Non-Program Vehicle, the scheduled
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daily depreciation charge for such Master Collateral Vehicle set forth by the
related Servicer in the Depreciation Schedule for such Master Collateral
Vehicle. If such charge is expressed as a percentage, the Depreciation Charge
for such Master Collateral Vehicle for such day shall be such percentage
multiplied by the Capitalized Cost for such Master Collateral Vehicle.
"Depreciation Schedule" means, with respect to any Non-Program Vehicles,
a schedule of estimated daily depreciation prepared by the Master Servicer or
the related Servicer, and revised from time to time in the Master Servicer or
the Servicer's sole discretion, with respect to each type of Non-Program
Vehicle that is a Master Collateral Vehicle.
"Determination Date" means the fifth Business Day prior to the twenty-
fifth (25th) day of each calendar month.
"Disposition Date" means:
(a) with respect to any Program Vehicle, (i) if such Vehicle was
sold in accordance with applicable Auction Procedures or returned to a
Manufacturer for repurchase, pursuant to the applicable Vehicle
Disposition Program, the date on which such Program Vehicle is sold at
auction or accepted for return by such Manufacturer or its agent and, in
each case, the Depreciation Charges ceased to accrue pursuant to such
Vehicle Disposition Program, or (ii) if such Program Vehicle was sold to
any Person (other than to a Manufacturer pursuant to such Manufacturer's
Vehicle Disposition Program or to a third party in accordance with
applicable Auction Procedures), the date on which title to the Master
Collateral Vehicle is transferred in connection with such sale, and
(b) with respect to any Non-Program Vehicle, the date on which
title to the Master Collateral Vehicle is transferred in connection with
such sale.
"Disposition Period" means, with respect to any Master Collateral
Vehicle, the period between the minimum holding period (prior to which RCFC or
the Lessee Grantor, as applicable, may not return such Master Collateral
Vehicle without a penalty) and the maximum holding period (after which RCFC or
the Lessee Grantor, as applicable, may not return such Master Collateral
Vehicle without a penalty) specified in the related Vehicle Disposition
Program.
"Disposition Proceeds" means the net proceeds from the sale or
disposition of a Master Collateral Vehicle to any Person.
"Dollar" has the meaning set forth in the preamble.
"DTAG" has the meaning provided in the preamble.
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"Eligible Vehicle" means a Master Collateral Vehicle meeting the
requirements for, as applicable, acquisition, financing, refinancing and/or
leasing under the Financing Documents relating thereto.
"Eligible Vehicle Disposition Program" means a Vehicle Disposition
Program offered by an Eligible Manufacturer that meets the eligibility criteria
specified in the Financing Documents relating thereto.
"Existing Fleet" has the meaning specified in the Financing Documents
related to the applicable Financing Source.
"FDIC" means the Federal Deposit Insurance Corporation.
"Financing Documents" means, with respect to a Financing Source, any and
all agreements, instruments and contracts evidencing or related to any
financing arrangement between RCFC and/or any of the Lessee Grantors and a
Financing Source (and/or a Beneficiary) providing for the making or credit
enhancing of loans or advances to RCFC and/or any of the Lessee Grantors, the
purchase of assets, or undivided interests therein, from RCFC or any of the
Lessee Grantors, the lease to any of the Lessee Grantors of Master Collateral
Vehicles, any other arrangement providing for the financing of the Master
Collateral Vehicles and all agreements, indentures, instruments and contracts
pursuant to which any Financing Source grants an interest in any portion of the
Master Collateral to a Beneficiary, in any such case, as such agreements,
indentures, instruments and contracts may be amended, supplemented, restated,
extended or otherwise modified from time to time in accordance with the terms
thereof.
"Financing Source" has the meaning set forth in the preamble.
"Financing Source and Beneficiary Supplement" means a supplement to this
Agreement, substantially in the form of Exhibit B hereto.
"Fitch" means Fitch Investors Service, L.P.
"Fleet Report" means the monthly report substantially in the form of
Exhibit C hereto required to be delivered by the Master Servicer to the Master
Collateral Agent pursuant to Section 2.4 hereof.
"Franchise Agreement" means a franchise agreement, license agreement or
other similar agreement (however designated) between a Lessee Grantor and a
Franchisee in connection with the operation of a rental car business and
related business activities in a designated territory using the name and marks
of the Lessee Grantor, whether now existing or hereafter made or entered into,
including any amendments, modifications or supplements thereto or restatements
thereof, but excluding any Sublease.
"Franchisee" means any Person licensed under a Franchise Agreement.
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"Grantor" means each of the Lessee Grantors and RCFC in its capacity as
grantor hereunder.
"Grantor Supplement" means a supplement to this Agreement, substantially
in the form of Exhibit A hereto.
"Guaranteed Payment" means a payment from the applicable Manufacturer
pursuant to such Manufacturer's Vehicle Disposition Program, upon disposition
of such Master Collateral Vehicle by the owner thereof in accordance with
applicable Auction Procedures.
"Group" has the meaning set forth in the Indenture.
"Incentive Payment", with respect to any Program Vehicle or Non-Program
Vehicle subject to any form of incentive program maintained by the Manufacturer
thereof (including, without limitation any vehicle supply agreement), means a
payment (other than a Guaranteed Payment or a Repurchase Payment) from such
Manufacturer, pursuant to and in accordance with the terms and conditions of
such an incentive program relating to such Program Vehicle or Non-Program
Vehicle.
"Incumbency Certificate" has the meaning set forth in Section 3.5.
"Indenture" means the Base Indenture, dated as of December 13, 1995,
between RCFC and Bankers Trust Company, as trustee, as amended, and as the same
may be further amended, modified, amended and restated or supplemented from
time to time in accordance with its terms, together with all of its
supplements, as the same may be amended, modified, amended and restated or
supplemented from time to time in accordance with the terms of the Indenture.
"Initial Acquisition Cost" means, with respect to each Master Collateral
Vehicle, the costs and expenses incurred in connection with the acquisition of
such Master Collateral Vehicle by the applicable Lessee Grantor or RCFC from
the dealer or other Person selling such Master Collateral Vehicle, as more
specifically defined in the Financing Documents related to the applicable
Financing Source.
"Investment Company Act" means the Investment Company Act of 1940, as
amended.
"Investment Standing Instruction" has the meaning set forth in Section
2.5(f) hereof.
"Lease" means (a) the Master Motor Vehicle Lease and Servicing
Agreement, as supplemented by the lease annexes thereto, dated as of December
13, 1995, by and between RCFC, as the lessor and Thrifty, in its capacity as
lessee and as servicer, (b) the Master Motor Vehicle Lease and Servicing
Agreement, as supplemented by the lease annexes thereto, dated as of December
23, 1997, by and among RCFC, as the lessor, Thrifty, Dollar and those
subsidiaries and affiliates of DTAG from time to time becoming lessees and
servicers thereunder, in their capacities as lessees and servicers, and DTAG,
as guarantor and master servicer, and (c) each
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other master motor vehicle lease and servicing agreement, as supplemented by
the lease annexes thereto, or similar agreement, entered into by RCFC and/or
one or more Lessee Grantors and constituting a Financing Document hereunder.
"Lessee Grantor" has the meaning set forth in the preamble.
"Lessee Grantor Master Collateral" has the meaning set forth in Section
2.1(b).
"Lessee Grantor Master Collateral Vehicles" has the meaning set forth in
Section 2.1(b)(i).
"Lien" means, when used with respect to any Person, any interest in any
real or personal property, asset or other right held, owned or being purchased
or acquired by such Person which secures payment or performance of any
obligation, and shall include any mortgage, lien, pledge, encumbrance, charge,
retained security title of a conditional vendor or lessor, or other security
interest of any kind, whether arising under a security agreement, mortgage,
lease, deed of trust, chattel mortgage, assignment, pledge, retention or
security title, financing or similar statement, or notice or arising as a
matter of law, judicial process or otherwise.
"Limited Guarantee and Reimbursement Agreement" means the Limited
Guarantee and Reimbursement Agreement, dated December 23, 1997 among Chrysler,
the Master Collateral Agent, DTAG, RCFC, Dollar and Thrifty as such agreement
may be amended, modified or supplemented.
"Manufacturer" means a manufacturer of Master Collateral Vehicles.
"Master Collateral" has the meaning set forth in Section 2.1(b).
"Master Collateral Account" has the meaning set forth in Section 2.5.
"Master Collateral Agent" has the meaning set forth in the preamble, and
includes any permitted successor to Bankers Trust Company in its capacity as
Master Collateral Agent.
"Master Collateral Vehicles" means the Lessee Grantor Master Collateral
Vehicles and the RCFC Master Collateral Vehicles.
"Net Book Value" with respect to any Master Collateral Vehicle, as of
any date of determination, (i) means the Capitalized Cost of such Master
Collateral Vehicle minus the aggregate Depreciation Charges, if any, accrued
with respect to such Master Collateral Vehicle through the last day of the
Related Month or (ii) has the meaning set forth in the Financing Documents for
the related Financing Source.
"Non-Program Vehicle" means a Master Collateral Vehicle that, when
acquired by RCFC or a Lessee Grantor or when so designated by the applicable
Servicer, in each case subject to
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certain limitations described in the applicable Financing Documents, is not
eligible for inclusion in any Eligible Vehicle Disposition Program.
"Notes" means the notes issued by RCFC pursuant to the Indenture.
"Officer's Certificate" means, with respect to any Person, a certificate
signed by the President, any Vice President, the Secretary, the Treasurer or
any other person designated as an authorized officer by the board of directors
of such Person.
"Permitted Investments" means negotiable instruments or securities
maturing on or before the Payment Date next occurring after the investment
therein, represented by instruments in bearer, registered or book-entry form
which evidence (i) obligations the full and timely payment of which is to be
made by or is fully guaranteed by the United States of America; (ii) demand
deposits of, time deposits in, or certificates of deposit issued by, any
depositary institution or trust company incorporated under the laws of the
United States of America or any state thereof and subject to supervision and
examination by Federal or state banking or depositary institution authorities;
provided, however, that at the earlier of (x) the time of the investment and
(y) the time of the contractual commitment to invest therein, the certificates
of deposit or short-term deposits, if any, or long-term unsecured debt
obligations (other than such obligation whose rating is based on collateral or
on the credit of a Person other than such institution or trust company) of such
depositary institution or trust company shall have a credit rating from
Standard & Poor's of "A-1+", from DCR (if DCR is then a Rating Agency) of at
least "D-1+" (if rated by DCR) and from Fitch (if Fitch is then a Rating
Agency) of at least "F-1" (if rated by Fitch), in the case of certificates of
deposit or short-term deposits, or a rating from Standard & Poor's of at least
"AA", from DCR (if DCR is then a Rating Agency) of at least "AA" (if rated by
DCR) and from Fitch (if Fitch is then a Rating Agency) of at least "A" (if
rated by Fitch), in the case of long-term unsecured debt obligations; (iii)
commercial paper having, at the earlier of (x) the time of the investment and
(y) the time of the contractual commitment to invest therein, a rating from
Standard & Poor's of "A-1+", from DCR (if DCR is then a Rating Agency) of at
least "D-1+" (if rated by DCR) and from Fitch (if Fitch is then a Rating
Agency) of at least "F-1" (if rated by Fitch); (iv) demand deposits or time
deposits which are fully insured by the FDIC; (v) bankers' acceptances issued
by any depositary institution or trust company described in clause (ii) above;
(vi) investments in money market funds rated at least "AAm" by Standard &
Poor's or otherwise approved in writing by Standard & Poor's, rated at least
"D-1+" by DCR (if rated by DCR and if DCR is then a Rating Agency) and rated at
least "A" by Fitch (if rated by Fitch and if Fitch is then a Rating Agency);
(vii) Eurodollar time deposits having a credit rating from Standard & Poor's of
"A-1+", from DCR (if DCR is then a Rating Agency) of at least "D-1+" (if rated
by DCR) and from Fitch (if Fitch is then a Rating Agency) of at least "F-1" (if
rated by Fitch); (viii) repurchase agreements involving any of the Permitted
Investments described in clauses (i) and (vii) above and the certificates of
deposit described in clause (ii) above which are entered into with a depository
institution or trust company having a commercial paper or short-term
certificate of deposit rating of "A-1+" by Standard & Poor's, of at least "D-
1+" from DCR (if rated by DCR and if DCR is then a Rating Agency) and of at
least "F-1" from Fitch (if rated by Fitch and if Fitch is then a Rating Agency)
or which otherwise is approved as to collateralization by the Rating Agencies;
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and (ix) any other instruments or securities, if the Rating Agencies confirm in
writing that the investment in such instruments or securities will not
adversely affect any ratings with respect to any series of Notes.
"Person" means any natural person, corporation, business trust, joint
venture, association, company, partnership, joint stock company, trust,
unincorporated organization, or any Federal, state, local or foreign court or
governmental department, commission, board, bureau, agency, authority,
instrumentality or regulatory body.
"Program Receivables" means amounts receivable from a Manufacturer under
an Eligible Vehicle Disposition Program in respect of vehicles previously owned
by a Lessee Grantor which amounts are transferred to RCFC under a Lease.
"Program Vehicle" means any Master Collateral Vehicle which, at the time
of its acquisition by Thrifty, Dollar any other Grantor or RCFC or any other
Financing Source under the applicable Financing Documents, is eligible under an
Eligible Vehicle Disposition Program offered by its Manufacturer.
"Pro rata" means, at any time as to any interest or amount with respect
to any Beneficiary, a fraction, the numerator of which is the aggregate
indebtedness and other obligations of each of the Lessee Grantors and RCFC, as
applicable, then owing to the applicable Financing Source for the benefit of
such Beneficiary and the denominator of which is the aggregate indebtedness and
other obligations of each of the Lessee Grantors and RCFC, as applicable, then
owing to all Financing Sources; provided, however, that if a Beneficiary must
return any amount paid with respect to such obligations for any reason, such
returned amounts shall be reinstated as obligations for purposes of the
foregoing calculation.
"Qualified Institution" means a depositary institution or trust company
(which may include the Master Collateral Agent) organized under the laws of the
United States of America or any one of the states thereof or the District of
Columbia; provided, however, that at all times such depositary institution or
trust company is a member of the FDIC and (i) has a long-term indebtedness
rating from Standard & Poor's of not lower than "AA", from DCR (if DCR is then a
Rating Agency) of at least "AA" and from Fitch (if Fitch is then a Rating
Agency) of not lower than "A" and a short-term indebtedness rating from
Standard & Poor's of not lower than "A-1+", from DCR (if DCR is then a Rating
Agency) of not lower than "D-1+" and from Fitch (if Fitch is then a Rating
Agency) of not lower than "F-1", or (ii) has such other rating which has been
approved by the Rating Agencies, or (iii) is otherwise approved by the Rating
Agencies.
"Rating Agencies" means, at any time of determination, any rating
agency, to the extent such agency, at the request of a Lessee Grantor or RCFC
pursuant to the applicable Financing Documents, is then rating the outstanding
securities or indebtedness of any Financing Source.
"RCFC" has the meaning set forth in the preamble.
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"RCFC Master Collateral" has the meaning set forth in Section 2.1(b).
"RCFC Master Collateral Vehicles" has the meaning set forth in Section
2.1(b)(i).
"Redesignation" has the meaning set forth in Section 2.2.
"Related Master Collateral" has the meaning set forth in Section 2.2.
"Related Month" means, with respect to any date, the period from and
including the first day of the calendar month preceding the month in which such
date falls, to and including the last day of such calendar month; provided,
however, that (for all purposes other than determining Depreciation Charges)
the initial Related Month with respect to any Lease and the Series of Notes
related thereto shall be (unless the context otherwise requires) the period
from and including the Lease Commencement Date for (and as defined in) such
Lease to and including the last day of the calendar month in such Lease
Commencement Date occurs.
"Related Vehicles" has the meaning set forth in Section 2.2.
"Reporting Date" means the Business Day next succeeding the
Determination Date.
"Repurchase Payment", with respect to any Program Vehicle subject to
repurchase by the Manufacturer thereof, means a payment by such Manufacturer,
pursuant to the Manufacturer's Vehicle Disposition Program, to repurchase such
Vehicle in accordance with its Vehicle Disposition Program.
"Required Beneficiaries" means, at any time, Beneficiaries (other than
any Lessee Grantor, if applicable) that are beneficiaries in respect of, or
that represent or act on behalf of Financing Sources (other than any Lessee
Grantor, if applicable) that hold (including by way of pledge or assignment),
more than 50% of the outstanding principal amount of indebtedness of the Lessee
Grantors and RCFC under the Financing Documents at such time (excluding any
retained interest of any such Lessee Grantor or RCFC thereunder).
"Responsible Officer" means, with respect to the Master Collateral
Agent, any Managing Director, Vice President, Assistant Vice President,
Secretary, Assistant Secretary, Treasurer or Assistant Treasurer, or any
officer performing functions similar to those customarily performed by the
person who at the time shall be such officer.
"Servicer" has the meaning set forth in the preamble.
"Standard & Poor's" means Standard & Poor's Structured Ratings, a
division of The McGraw-Hill Companies, Inc.
"Sublease" means a standardized lease agreement, for the leasing of
Master Collateral Vehicles, between a Lessee Grantor, as lessor, and a
Franchisee of such Lessee Grantor that
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meets the normal credit and other approval criteria of such Lessee Grantor and
which may be an affiliate of such Lessee Grantor, as lessee.
"Thrifty" has the meaning set forth in the preamble.
"Thrifty Master Collateral" means, with respect to the Series 1995-1
Notes, the portion of the Lessee Grantor Master Collateral granted by Thrifty
pursuant to Section 2.1(a).
"Thrifty Master Collateral Vehicles" means, with respect to the Series
1995-1 Notes, the Lessee Grantor Master Collateral Vehicles constituting
Thrifty Master Collateral.
"Trustee" means Bankers Trust Company in its capacity as trustee under
the Indenture unless a successor Person shall have become the trustee pursuant
to the applicable provisions of the Indenture, and thereafter "Trustee" shall
mean such successor Person.
"Uniform Commercial Code" or "UCC" means, with respect to a particular
jurisdiction, the Uniform Commercial Code as in effect from time to time in
such jurisdiction, or any successor statute thereto.
"Vehicle Disposition Program" means a program pursuant to which a
Manufacturer has agreed, subject to the terms and conditions thereof, to
guarantee the maximum daily depreciation levels of, or to repurchase, Master
Collateral Vehicles manufactured by it or one of its Affiliates during the
specified Disposition Period.
"Vehicle Lien Nominee Agreement" means the Vehicle Lien Nominee
Agreement, dated December 23, 1997 between Chrysler Financial Corporation, the
Trustee, the Master Collateral Agent and RCFC, as such agreement may be
amended, modified or supplemented.
"Vehicle Term", with respect to each Master Collateral Vehicle, will
have the meaning set forth in the Financing Documents for the Financing Source
with respect to such Master Collateral Vehicle.
SECTION 1.2. Cross References; Headings. The words "hereof", "herein"
and "hereunder" and words of a similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement. Annex, Section, Schedule and Exhibit references contained in this
Agreement are references to Annexes, Sections, Schedules and Exhibits in or to
this Agreement unless otherwise specified. Any reference in any Section or
definition to any clause is, unless otherwise specified, to such clause of such
Section or definition. The various headings in this Agreement are inserted for
convenience only and shall not affect the meaning or interpretation of this
Agreement or any provision hereof.
SECTION 1.3. Interpretation. In this Agreement, unless the context
otherwise requires:
(a) the singular includes the plural and vice versa;
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(b) reference to any Person includes such Person's successors
and assigns but, if applicable, only if such successors and assigns are
permitted by this Agreement, and reference to any Person in a particular
capacity only refers to such Person in such capacity;
(c) reference to any gender includes the other gender;
(d) "including" (and, with correlative meaning, "include") means
including without limiting the generality of any description preceding
such term;
(e) "or" is not exclusive;
(f) provisions apply to successive events and transactions; and
(g) with respect to the determination of any period of time,
"from" means "from and including" and "to" and "through" mean "to but
excluding".
ARTICLE II
MASTER COLLATERAL AGENT AS LIENHOLDER
FOR THE BENEFICIARIES
SECTION 2.1. Security Interests.
(a) Grant by the Lessee Grantors. As security for the payment of the
respective obligations from time to time owing by each of the Lessee Grantors
to each Financing Source (or any Beneficiary as assignee thereof) under the
related Financing Documents (x) Thrifty (without limiting the grant by Thrifty
pursuant to clause (y) immediately following), confirms its grant, pledge and
assignment pursuant to the Original Agreement and (y) to the extent not covered
in clause (x), each of the Lessee Grantors hereby grants, pledges and assigns
to the Master Collateral Agent, for the benefit of the Beneficiaries (to the
extent set forth in Sections 2.2 and 2.3), subject to the provisions of
subsection (c) below, a continuing, first priority Lien on all right, title and
interest of such Lessee Grantor in, to and under the following, whether
existing or acquired as of the Closing Date with respect to any series of Notes
or any Financing Documents related to a Financing Source or thereafter (the
"Lessee Grantor Master Collateral"):
(i) all vehicles (A) acquired, financed or refinanced with funds
provided by any Financing Source or Beneficiary and identified as Lessee
Grantor Master Collateral Vehicles related to such Lessee Grantor in any
Fleet Reports delivered to the Master Collateral Agent and/or (B)
identified as being owned by such Lessee Grantor and subject to the lien
of the Master Collateral Agent in each case on the Certificates of Title
thereof (collectively, with respect to all of the Lessee Grantors, the
"Lessee Grantor Master Collateral Vehicles"), and all Certificates of
Title with respect thereto;
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(ii) the Master Collateral Account, all funds on deposit therein
from time to time, all certificates and instruments, if any,
representing or evidencing any or all of the Master Collateral Account
or the funds on deposit therein from time to time, and all Permitted
Investments made at any time and from time to time with the funds on
deposit in the Master Collateral Account (including income thereon) and
all certificates and instruments, if any, representing or evidencing
such Permitted Investments;
(iii) all Vehicle Disposition Programs and incentive programs
applicable to Lessee Grantor Master Collateral Vehicles, to the extent
such right, title and interest relates to such Lessee Grantor Master
Collateral Vehicles, including any amendments thereof and all monies due
and to become due in respect of such Lessee Grantor Master Collateral
Vehicles under or in connection with each such Vehicle Disposition
Program and incentive program, whether payable as Repurchase Payments,
Guaranteed Payments, Disposition Proceeds, Incentive Payments, auction
sales proceeds, fees, expenses, costs, indemnities, insurance
recoveries, damages for breach of any Vehicle Disposition Program or
otherwise and all rights to compel performance and otherwise exercise
rights and remedies thereunder;
(iv) all Subleases entered into by such Lessee Grantor the
subject of which includes any Master Collateral Vehicle leased by RCFC
to such Lessee Grantor under a Lease, and all other contracts,
agreements, guarantees, insurance, warranties, instruments or
certificates entered into or delivered to such Lessee Grantor in
connection with any such Sublease, in each case only to the extent
directly relating to any Master Collateral Vehicle, including (but only
to such extent), without limitation, all monies due and to become due to
such Lessee Grantor under or in connection with such agreements whether
payable as rent, guaranty payments, fees, expenses, costs, indemnities,
insurance recoveries, damages for the breach of any of the agreements or
otherwise, and all rights, remedies, powers, privileges and claims of
such Lessee Grantor against any other party under or with respect to
such agreements (whether arising pursuant to the terms of such
agreements or otherwise available to such Lessee Grantor at law or in
equity), including the right to enforce any of the agreements as
provided herein and to give or withhold any and all consents, requests,
notices, directions, approvals, extensions or waivers under or with
respect to the agreements or the obligations of any party thereunder,
all liens and property from time to time purporting to secure payment
arising under or in connection with such agreements, or assigned to,
such Lessee Grantor describing any collateral securing such obligations
or liabilities and all guarantees, insurance and other agreements or
arrangements of whatever character from time to time supporting or
securing payment of such obligations and liabilities due to such Lessee
Grantor pursuant to such agreements);
(v) all Assignment Agreements entered into by such Lessee
Grantor;
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<PAGE> 19
(vi) all payments under insurance policies (whether or not the
Master Collateral Agent is named as the loss payee thereof) with respect
to any of the Lessee Grantor Master Collateral Vehicles;
(vii) all additional property that may on the Closing Date or
from time to time hereafter be subjected to the grant and pledge under
this Agreement, as the same may be modified or supplemented from time to
time, by such Lessee Grantor or by anyone on its behalf; and
(viii) any and all proceeds, products, offspring, rents or
profits of any and all of the foregoing.
Notwithstanding anything to the contrary contained in this Master
Collateral Agency Agreement, the pledge and security interest granted by each
of the Lessee Grantors hereunder is an extension of the pledge and security
interest granted under the Original Agreement.
(b) Grant by RCFC. As security for the payment of the respective
obligations from time to time owing by RCFC to each other Financing Source (or
any Beneficiary as assignee thereof) under the related Financing Documents,
RCFC hereby (x) confirms its grant, pledge and assignment pursuant to the
Original Agreement and (y) to the extent not covered by clause (x), grants,
pledges and assigns to the Master Collateral Agent, for the benefit of the
Beneficiaries (to the extent set forth in Sections 2.2 and 2.3), a continuing,
first priority Lien on all right, title and interest of RCFC in, to and under
the following, whether existing or acquired as of the first Closing Date under
the Indenture or thereafter (the "RCFC Master Collateral" and, together with
the Lessee Grantor Master Collateral, the "Master Collateral"):
(i) all vehicles (A) acquired, financed or refinanced with funds
provided by any Financing Source or Beneficiary and identified as RCFC
Master Collateral Vehicles in any Fleet Report delivered to the Master
Collateral Agent and/or (B) identified as being owned by RCFC and
subject to the lien of the Master Collateral Agent on the Certificates
of Title thereof (collectively, the "RCFC Master Collateral Vehicles"),
and all Certificates of Title with respect thereto;
(ii) the Master Collateral Account, all funds on deposit therein
from time to time, all certificates and instruments, if any,
representing or evidencing any or all of the Master Collateral Account
or the funds on deposit therein from time to time, and all Permitted
Investments made at any time and from time to time with the funds on
deposit in the Master Collateral Account (including income thereon) and
all certificates and instruments, if any, representing or evidencing
such Permitted Investments;
(iii) all Vehicle Disposition Programs and incentive programs
applicable to the RCFC Master Collateral Vehicles to the extent such
right, title and interest relates to such RCFC Master Collateral
Vehicles or to any Program Receivables, including any amendments thereof
and all monies due and to become due in respect of such RCFC
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Master Collateral Vehicles or such Program Receivables under or in
connection with each such Vehicle Disposition Program, whether payable
as Repurchase Payments, Guaranteed Payments, Disposition Proceeds,
Incentive Payments, auction sales proceeds, fees, expenses, costs,
indemnities, insurance recoveries, damages for breach of the Vehicle
Disposition Program or otherwise and all rights to compel performance
and otherwise exercise rights and remedies thereunder;
(iv) all Assignment Agreements entered into by RCFC;
(v) all payments under insurance policies (whether or not the
Master Collateral Agent is named as the loss payee thereof) with respect
to any of the Master Collateral Vehicles;
(vi) all right, title and interest of RCFC in, to and under the
Vehicle Lien Nominee Agreement and the Limited Guaranty and
Reimbursement Agreement and any and all payments and proceeds in respect
thereof;
(vii) all additional property that may on the Closing Date or
from time to time hereafter be subjected to the grant and pledge under
this Agreement, as the same may be modified or supplemented from time to
time, by RCFC or by anyone on its behalf; and
(viii) any and all proceeds, products, offspring, rents, or
profits of any of the foregoing.
Notwithstanding anything to the contrary contained in this Master
Collateral Agency Agreement, the pledge and security interest granted by RCFC
hereunder is an extension of the pledge and security interest granted under the
Original Agreement.
Each Lessee Grantor, RCFC, each other Financing Source and each
Beneficiary hereby authorizes the Master Collateral Agent to be named as the
first lienholder on the Certificates of Title for the Master Collateral
Vehicles (or, with respect to any Master Collateral Vehicle in an Existing
Fleet, to be the assignee of the first lienholder shown on the Certificates of
Title), in a representative capacity, as Master Collateral Agent for the
Beneficiaries. The Master Collateral Agent agrees that all of its right, title
and interest in and to the Master Collateral shall be solely for the respective
benefit of each Beneficiary.
Each Financing Source and each Beneficiary hereby directs the Master
Collateral Agent to execute and deliver as of the date set forth herein in its
capacity as Master Collateral Agent hereunder each Assignment Agreement
hereafter entered into by any of the Lessee Grantors or RCFC.
(c) Exclusions. Notwithstanding the provisions of Section 2.1(a), it
is expressly acknowledged and agreed that the Lessee Grantor Master Collateral
does not and shall not in any event include any of the following items or types
of property:
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(i) any Franchise Agreement, or any monies due or to become due
to the applicable Lessee Grantor under any Franchise Agreement,
including, without limitation, monies due or to become due to such
Lessee Grantor on account of, relating to or in connection with (a)
administrative fees, advertising fees and license or franchise fees
under or in connection with any Franchise Agreements, (b) the grant,
transfer, sale or other disposition, in whole or in part, of any
Franchise Agreement, (c) the sale, lease or other offering by such
Lessee Grantor of goods, supplies or products (excluding, however,
Master Collateral Vehicles) to any Franchisee or the performance of
services by such Lessee Grantor for any Franchisee, (d) insurance
programs for Franchisees offered under or in connection with any
Franchise Agreement, (e) credit card services provided in connection
with any Franchise Agreement, and (f) promissory notes delivered
pursuant to or in connection with any Franchise Agreement, or any other
accounts, general intangibles, chattel paper, documents and instruments
relating to or arising out of or in connection any Franchise Agreement;
(ii) any advertising or promotional allowances payable to any
Lessee Grantor by any Manufacturer;
(iii) any monies due or to become due to any Lessee Grantor or
any Franchisee or Affiliate of any Lessee Grantor from the retail rental
of vehicles; or
(iv) any amounts payable by a Manufacturer to any Lessee
Grantor which constitute manufacturer floor plan assistance.
Each Financing Source and each Beneficiary hereby disclaims and affirmatively
waives any right, title or interest in and to any of the foregoing items or
types of property under or pursuant to this Agreement.
SECTION 2.2. Designation of Beneficiaries; Beneficiaries' Rights
Limited. Each of the Trustee, RCFC and any other Person who from time to time
executes a Financing Source and Beneficiary Supplement as a beneficiary is
hereby designated as a Beneficiary with respect to the Master Collateral
Vehicles designated on the Master Servicer's computer system as Master
Collateral Vehicles acquired by or financed with the proceeds advanced by the
Financing Sources relating to such Beneficiary or as otherwise provided in a
Financing Source and Beneficiary Supplement with respect to such Beneficiary
("Related Vehicles") and the other Master Collateral related thereto (the
"Related Master Collateral"). The designation of Related Vehicles with respect
to each Beneficiary on the Master Servicer's computer system shall be
considered prima facie evidence of such Beneficiary's rights with respect to
such Related Vehicles and the Related Master Collateral. If at any time a
Beneficiary reasonably believes that such designation by the Master Servicer is
incorrect, it may dispute such designation by delivering a written notice to
the Master Collateral Agent setting forth its claim as to the correct
designation of its Related Vehicles (each a "Redesignation"). The Master
Collateral Agent shall, promptly upon receipt of such notice, distribute a copy
thereof to each Lessee Grantor, RCFC, each Financing Source and each
Beneficiary (other than the Beneficiary disputing the Master Servicer's
designation of Related
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Vehicles). Each such Financing Source and Beneficiary shall, within ten (10)
Business Days of receipt of such notice from the Master Collateral Agent,
notify the Master Collateral Agent in writing as to whether it consents to the
disputing Beneficiary's Redesignation. If the Master Collateral Agent receives
written notice from each such Beneficiary and Financing Source containing its
consent to the disputing Beneficiary's Redesignation within the period set
forth above, it shall promptly notify the Master Servicer and the Master
Servicer shall effect such Redesignation. Each Beneficiary shall be entitled
to the benefits of this Agreement only with respect to its Related Vehicles and
Related Master Collateral. No Beneficiary shall have any interest in (i) any
Master Collateral Vehicle which is not a Related Vehicle as to such
Beneficiary, (ii) any funds in the Master Collateral Account that are proceeds
of any Master Collateral Vehicle which is not a Related Vehicle as to such
Beneficiary, (iii) rights under any Vehicle Disposition Program with respect to
any Master Collateral Vehicle which is not a Related Vehicle as to such
Beneficiary or (iv) any other Master Collateral which is not Related Master
Collateral as to such Beneficiary, in each case regardless of the time, order,
manner or nature of attachment or perfection of security interests in Master
Collateral Vehicles (including the giving of or failure to give notice of any
purchase money security interest or other notice, or the order of filing
financing statements), or any provision of the Uniform Commercial Code, the
federal Bankruptcy Code, or other applicable law.
SECTION 2.3. Redesignation of Beneficiaries. RCFC, with respect to the
RCFC Master Collateral Vehicles, and each of the Lessee Grantors, with respect
to the Lessee Grantor Master Collateral Vehicles, may from time to time
refinance Master Collateral Vehicles related to a particular Financing Source
with proceeds from a different Financing Source. In connection therewith, the
Master Servicer shall designate on its computer system the Financing Source the
proceeds of which are used to finance or refinance such Master Collateral
Vehicles, and, upon repayment of the Financing Source being refinanced, (x)
such Master Collateral Vehicles shall automatically constitute Related Vehicles
of the specified Beneficiary or Beneficiaries related to such refinancing
Financing Source, and (y) such Master Collateral Vehicles shall cease to be
Related Vehicles of the Beneficiary or Beneficiaries related to the refinanced
Financing Source. In addition, the Master Servicer may from time to time
redesignate on its computer system, to a new Beneficiary related to a Financing
Source, one or more Master Collateral Vehicles that are Related Vehicles of
another Beneficiary related to such Financing Source, if such related Vehicles
have been designated to specific Beneficiaries. Notwithstanding the foregoing,
the right of the Master Servicer to redesignate Master Collateral Vehicles that
will, after such a refinancing, cease to be Related Vehicles with respect to a
Financing Source or Beneficiary shall be subject to the conditions that
immediately after giving effect to such redesignation:
(a) no Default shall exist under the Financing Documents related
to such Financing Source Beneficiary (provided, however, that the Master
Servicer shall have the right to make such redesignation for the purpose
of curing such a Default); and
(b) Unless otherwise specified in the Financing Source and
Beneficiary Supplement therefor, such Financing Source or Beneficiary
shall have designated to it Related Vehicles with a collateral value (as
determined, in accordance with the Financing Documents
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relating to the Financing Source or with respect to such Beneficiary, by
the Person specified therein or, if no such Person is so specified, by
the Master Servicer) not less than the minimum collateral value required
in such Financing Documents to support the outstanding loans or
securities issued under such Financing Documents.
Each designation of a Beneficiary pursuant to Section 2.2, and each
redesignation by the Master Servicer pursuant to this Section 2.3, shall
automatically constitute a representation and warranty by the Master Servicer
for the benefit of the Beneficiary to which the Master Collateral Vehicle is
being designated or redesignated that (i) with respect to such a redesignation,
the conditions in Sections 2.3(a) and 2.3(b) have been met, (ii) with respect
to such a redesignation, the loans or securities of the original Financing
Source with respect to such refinanced Master Collateral Vehicles have been
repaid, and (iii) with respect to any such designation or redesignation, all
Related Vehicles of such Beneficiary constitute Eligible Vehicles under the
relevant Financing Documents. Master Collateral Vehicles shall be redesignated
hereunder at their respective Net Book Values, calculated in accordance with
the Financing Documents relating to the Financing Source with respect to the
applicable Beneficiary. Except as provided in Section 2.5(c), no Beneficiary
shall have any interest in any Master Collateral Vehicle or other Master
Collateral for which it is no longer designated as the Beneficiary, it being
understood that, subject to the satisfaction of the conditions set forth in
Sections 2.3(a) and 2.3(b) and repayment of the loans or securities of the
original Financing Source with respect to refinanced Master Collateral
Vehicles, any such redesignation shall automatically constitute a release by
such Beneficiary of any interest therein.
SECTION 2.4. Master Servicer's Fleet Report. On or prior to the
Reporting Date, the Master Servicer shall furnish to the Master Collateral
Agent a report (which may be on diskette, magnetic tape or other electronic
medium acceptable to the Master Collateral Agent) substantially in the form of
Exhibit C ("Fleet Report"), showing for each Financing Source and each Related
Vehicle designated thereto, as of the last day of the immediately preceding
calendar month and after giving effect to the most recent redesignation of
Master Collateral Vehicles (i) the related Beneficiary in respect thereof, (ii)
whether such Related Vehicle is a Lessee Grantor Master Collateral Vehicle or
an RCFC Master Collateral Vehicle, (iii) the last eight digits of the vehicle
identification numbers with respect to such Related Vehicle, and (iv) the
Capitalized Cost and Net Book Value of such Related Vehicle (calculated in
accordance with the Financing Documents relating to the applicable Financing
Source). The Master Collateral Agent shall make the Fleet Report available for
inspection by any Financing Source or Beneficiary at the Corporate Trust
Office, during normal business hours, upon such Financing Source or
Beneficiary's written request. Each Fleet Report shall, upon delivery thereof
to the Master Collateral Agent, become Exhibit C hereto and shall replace and
supersede all prior Fleet Reports in such capacity. The Master Collateral
Agent's sole responsibility with respect to such Fleet Report shall be
custodial.
SECTION 2.5. Master Collateral Account. (a) The Master Collateral
Agent shall establish and maintain, or cause to be established and maintained,
in the name of Master Collateral Agent for the benefit of the Beneficiaries,
one or more accounts (collectively, the "Master Collateral Account"), each
bearing a designation clearly indicating that the funds deposited therein
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are held for the respective benefit of each Beneficiary and, in each case, as
to which sole dominion and control shall be vested in the Master Collateral
Agent. The Master Collateral Account shall be maintained (i) with one or more
Qualified Institutions, or (ii) as segregated trust accounts with the
corporate trust departments of depository institutions or trust companies
having corporate trust powers so long as each such institution has a credit
rating for its unsecured long-term debt not lower than investment grade by
Standard & Poor's. If the Master Collateral Account (or any subaccount
thereof) is not maintained in accordance with the previous sentence, then
within ten (10) Business Days after a Responsible Officer has received written
notice from any related Beneficiary or Financing Source to establish a new
Master Collateral Account or subaccount thereof or has actual notice followed
by written confirmation (which confirmation the Master Collateral Agent shall
use its best efforts to obtain as soon as practicable at the request of the
related Beneficiary or Financing Source) of such fact, the Master Collateral
Agent shall establish a new Master Collateral Account (or a new subaccount)
which complies with such sentence and transfer into the new Master Collateral
Account (or subaccount) all funds from the non-qualifying Master Collateral
Account (or subaccount). Initially, the Master Collateral Account will be
established with BOK and Bankers Trust Company, and both accounts together
shall be the Master Collateral Account.
(b) The Servicers and the Grantors shall direct all payments
representing (i) Disposition Proceeds, (ii) Guaranteed Payments and Repurchase
Payments under Vehicle Disposition Programs, (iii) Incentive Payments under
incentive programs, (iv) all payments under the Subleases and (v) all other
payments or other proceeds arising from the Master Collateral to be deposited
directly into the Master Collateral Account. In the event that the Master
Servicer, any Servicer, RCFC or any Financing Source shall receive directly any
such payments or proceeds, including cash, securities, obligations or other
property, such Person shall accept in constructive trust for the Master
Collateral Agent, and hold and deposit into the Master Collateral Account at
Bankers Trust Company within two (2) Business Days of receipt thereof, any of
the foregoing payments or proceeds received directly by such Person in respect
of the Master Collateral, with the endorsement or other evidence of transfer of
such Person when necessary or appropriate. Each Grantor shall designate the
Master Collateral Agent as loss payee on its physical damage and comprehensive
insurance policies on the Master Collateral Vehicles. The Master Collateral
Agent shall, within one (1) Business Day after receipt thereof, notify the
Master Servicer when funds are deposited in the Master Collateral Account and
the amount of such funds and promptly thereafter, but in no event more than two
(2) Business Days after the receipt of such notice from the Master Collateral
Agent, the Master Servicer shall instruct the Master Collateral Agent in
writing (upon which instruction the Master Collateral Agent is entitled to
conclusively rely) with respect to funds received hereunder as to (i) the
aggregate amount thereof which represents payments or other proceeds arising
from the Related Vehicles and Related Master Collateral of each Beneficiary,
(ii) upon the occurrence and during the continuance of a Default and as needed
under clause (c) or (d) below or, in the sole judgment of the Master Servicer,
as otherwise needed, the dollar amount thereof that is derived from Lessee
Grantor Master Collateral and from RCFC Master Collateral, (iii) the dollar
amount of Sublease payments, insurance payments, warranty payments and other
payments, as set forth below, in each case relating to Master Collateral
Vehicles, which, so long as no Default under the related Financing Documents
has occurred and is
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continuing or would result therefrom, may be withdrawn from the Master
Collateral Account and distributed to the applicable Lessee Grantor, (iv) the
dollar amount of funds not constituting Master Collateral (which may be
distributed at any time to the Person entitled thereto), and (v) any additional
information provided by the Master Servicer pursuant to and in accordance with
Section 24.4(a) of the Lease. The Master Collateral Agent shall promptly after
receipt of instructions from the Master Servicer (upon which instructions the
Master Collateral Agent may conclusively rely), but in no event later than ten
(10) days after any such payments or proceeds are first received by RCFC, a
Lessee Grantor, the Trustee or the Master Collateral Agent (including by
deposit in the Master Collateral Account), distribute or cause to be
distributed to each Beneficiary, in an amount specified by the Master Servicer
as provided above, the funds in the Master Collateral Account representing
payments or other proceeds arising from the Related Vehicles and Related Master
Collateral of such Beneficiary, to an account previously specified in writing
by such Beneficiary to the Master Collateral Agent; provided, however, that the
Master Servicer shall not direct the Master Collateral Agent to so remit any
amount in respect of Lessee Grantor Master Collateral or RCFC Master
Collateral, as the case may be, that would exceed the amount required to pay
all amounts owing to such Beneficiary or to the Financing Source related to
such Beneficiary by RCFC or the Lessee Grantors, respectively; and provided,
further, that so long as no Default has occurred and is continuing or would
result therefrom, all funds representing (x) payments under a Sublease or under
any contract, agreement, guaranty, insurance, warranty, instrument or
certificate entered into by or delivered to a Lessee Grantor, in connection
with a Sublease, or (y) payments under insurance policies or warranties payable
by reason of loss or damage to, or otherwise with respect to, any of the Master
Collateral Vehicles, shall promptly be distributed to the applicable Lessee
Grantor, to an account previously specified in writing by such Lessee Grantor,
or as the applicable Lessee Grantor shall otherwise direct. Notwithstanding
the foregoing, the Master Servicer may at any time instruct the Master
Collateral Agent to release any funds not constituting Master Collateral to the
Person entitled thereto.
(c) At such time as no further distributions from a Lessee Grantor to a
Financing Source, pursuant to the Financing Documents, are required or will be
required to be made to a Beneficiary in accordance with Section 2.5(b), and any
applicable bankruptcy preference period has expired, all remaining funds
deposited in respect of Lessee Grantor Master Collateral in the Master
Collateral Account and allocated to such Beneficiary shall promptly be
distributed to such Lessee Grantor upon the written direction of the Master
Servicer.
(d) At such time as no further distributions from RCFC to a Financing
Source, pursuant to the Financing Documents, are required or will be required
to be made to a Beneficiary in accordance with Section 2.5(b), and any
applicable bankruptcy preference period has expired, all remaining funds
deposited in respect of RCFC Master Collateral in the Master Collateral Account
and allocated to such Beneficiary shall promptly be distributed to RCFC upon
the written direction of the Master Servicer.
(e) If at any time the Master Collateral Agent, a Servicer or the
Master Servicer shall receive any funds to which it is not entitled pursuant to
the provisions of this Agreement, such Servicer or the Master Servicer shall so
advise the Master Collateral Agent (upon which advice
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the Master Collateral Agent may conclusively rely) and the Master Collateral
Agent or such Servicer or the Master Servicer, as the case may be, shall
forthwith take reasonable steps to ensure that such funds are remitted to the
Person so entitled thereto, such remittance to be made promptly after the
determination thereof and if by the Master Collateral Agent, as directed in
writing by the Master Servicer.
(f) The Master Servicer shall instruct (upon which instruction the
Master Collateral Agent may conclusively rely) the Master Collateral Agent in
writing to invest funds on deposit in the Master Collateral Account in
Permitted Investments. If the Master Collateral Agent does not receive
instructions from the Master Servicer prior to 11:00 a.m., New York City time,
on any day as to the distribution or investment of any funds in the Master
Collateral Account, then the Master Collateral Agent shall invest such funds in
Permitted Investments set forth in Exhibit H, as the same may be from time to
time revised by the Master Servicer upon three (3) Business Days' prior written
notice to the Master Collateral Agent (the "Investment Standing Instruction").
All such investments shall be redeemable or mature on the next Business Day.
Neither the Master Servicer nor the Master Collateral Agent shall be
responsible for any losses incurred on any investments made pursuant to and in
accordance with this paragraph (f). The Master Collateral Agent shall, in
accordance herewith, be entitled to rely upon the most recent Investment
Standing Instruction or other written instruction received pursuant to this
Section 2.5(f).
SECTION 2.6. Certificates of Title. Each Servicer shall hold in trust,
as agent of and as custodian for the Master Collateral Agent, all Certificates
of Title for Master Collateral Vehicles leased by such Servicer under a Lease.
The applicable Servicer shall (i) hold all such Certificates of Title under
lock and key, in a safe fireproof location at one or more of the offices
specified in Exhibit D (as the same may be from time to time revised by the
applicable Servicer upon thirty (30) days' prior written notice to the parties
hereto), and (ii) not release or surrender any Certificate of Title except in
accordance with this Agreement (and in any event not release or surrender any
of the Certificates of Title other than Certificates of Title as to which the
Lien of the Master Collateral Agent has been released in accordance with this
Agreement). The applicable Servicer shall cause the Certificates of Title with
respect to each Master Collateral Vehicle leased by it under a Lease (other
than a Master Collateral Vehicle included in an Existing Fleet) to show the
applicable Lessee Grantor, and with respect to each RCFC Master Collateral
Vehicle to show RCFC, as the registered owner thereof and to show Bankers Trust
Company, as agent (or as otherwise required under governing law to perfect the
Lien of the Master Collateral Agent), as the first lienholder at the address
referred to in the next sentence. The Master Collateral Agent has established
a post office box in Tulsa, Oklahoma at an address specified in Section 5.2
hereof, to be used from and after the date hereof as its exclusive address as
first lienholder noted on the Certificates of Title. The Master Collateral
Agent shall, on a semi-weekly basis, forward to each Lessee Grantor at its
address set forth in Section 5.2 hereof, all Certificates of Title received at
such post office box address titled in the name of such Lessee Grantor, all
Certificates of Title received at such post office box address titled in the
name of RCFC.
SECTION 2.7. Notation of Liens; Release of Collateral. (a) The Master
Collateral Agent hereby grants to each Servicer a limited power of attorney,
with full power of substitution,
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to take any and all actions, in the name of the Master Collateral Agent, (i) to
note the Master Collateral Agent as the holder of a first lien on the
Certificates of Title, and/or otherwise ensure that the first Lien shown on any
and all Certificates of Title (other than any Certificates of Title relating to
an Existing Fleet) is in the name of the Master Collateral Agent, (ii) to
release the Master Collateral Agent's Lien on any Certificate of Title in
connection with the sale or disposition of the related Master Collateral
Vehicle permitted pursuant to the provisions of the Financing Documents
relating to such Master Collateral Vehicle; and (iii) to release the Master
Collateral Agent's Lien on any Certificate of Title with respect to any Master
Collateral Vehicle which is not a Related Vehicle with respect to any
Beneficiary or with respect to which all obligations under the Financing
Documents to each related Beneficiary have been satisfied in full (and any
applicable bankruptcy preference period has expired). Nothing in this
Agreement shall be construed as authorization from the Master Collateral Agent
to any Servicer to release any Lien on any Certificate of Title except upon
compliance with this Agreement.
(b) Each Beneficiary may cause the Master Collateral Agent to terminate
the limited power of attorney referred to in Section 2.7(a) (including the
related power granted under Section 2.8) with respect to such Beneficiary's
Related Vehicles after the occurrence, and during the continuance, of a Default
(after giving effect to any cure period or grace period) under the Financing
Documents relating to the Financing Source with respect to such Beneficiary by
giving written notice to such effect to the applicable Servicer and the Master
Collateral Agent. The Master Collateral Agent agrees that upon receipt of any
such notice it shall promptly terminate such power of attorney with respect to
such Beneficiary's Related Vehicles by giving written notice to such effect to
the applicable Servicer. The power of attorney referred to in Section 2.7(a)
(including the related power granted under Section 2.8) will also terminate
following the resignation or removal of the Master Collateral Agent pursuant to
Section 4.5. The Master Collateral Agent will follow the direction (upon which
direction the Master Collateral Agent may conclusively rely) of the applicable
Servicer to release liens on Master Collateral Vehicles unless either a
contrary direction is received from a Financing Source or Beneficiary or the
Financing Documents require direction to be given by another party. In
connection with any release permitted under this Section 2.7, the Master
Collateral Agent and each Beneficiary agrees to execute such further documents,
if any, as may be reasonably requested by the applicable Servicer to effect
such release.
SECTION 2.8. Power of Attorney. To further evidence the limited power
of attorney referred to in Section 2.7, the Master Collateral Agent agrees that
upon request of the Servicer it will execute a separate power of attorney
substantially in the form of Exhibit E.
ARTICLE III
THE MASTER SERVICER
SECTION 3.1. Acceptance of Appointment. Each Financing Source and each
Beneficiary hereby appoints DTAG, and DTAG hereby accepts such appointment and
agrees to
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act, as the initial Master Servicer under this Agreement. The Master
Collateral Agent acknowledges such appointment.
SECTION 3.2. Master Servicer Functions. The Master Servicer shall
service and administer the Master Collateral Vehicles, and without limitation
of the foregoing, the Master Servicer shall: (i) cause the Master Collateral
Agent to be shown as the first lienholder on all Certificates of Title with
respect to the Master Collateral Vehicles (other than Certificates of Title
relating to an Existing Fleet), and forward to the Servicer of the related
Vehicle all such Certificates of Title titled in the name of RCFC, (ii) in
accordance with the requirements of the Financing Documents related to a
Financing Source and as applicable thereunder, designate as Related Vehicles on
its computer system with respect to each Beneficiary related to such Financing
Source and in accordance with Sections 2.2 and 2.3 hereof, Master Collateral
Vehicles (a) that have been purchased by or purchased, financed or refinanced
with funds provided by such Financing Source or as otherwise provided in a
Financing Source and Beneficiary Supplement with respect to such Beneficiary,
or (b) with a collateral value (as determined under the relevant Financing
Documents relating to the Financing Source with respect to such Beneficiary)
not less than the collateral value required in such Financing Documents to be
allocated to such Beneficiary to support the outstanding loans or securities
issued or obligations arising under such Financing Documents, (iii) direct
payments and other proceeds due under the Vehicle Disposition Programs and
payments and other proceeds with respect to other Master Collateral to be
deposited directly into the Master Collateral Account by the Manufacturers,
related auction dealers, eligible franchisees and any other Person making such
a payment, in accordance with this Agreement and allocate such payments to the
various Beneficiaries, (iv) furnish the Fleet Report as provided in Section
2.4, (v) instruct the Master Collateral Agent to make distributions,
withdrawals and payments from the Master Collateral Account in accordance with
Sections 2.5(b) through 2.5(d) in accordance with the related Financing
Documents, (vi) execute and deliver, for the benefit of the Beneficiaries, any
and all documents with respect to the Master Collateral Vehicles and the
Vehicle Disposition Programs and, to the extent permitted under and in
compliance with applicable law and regulations, commence enforcement
proceedings with respect to such Vehicle Disposition Programs,(vii) perform the
functions described in Section 2.7, and (viii) otherwise administer and service
(or cause to be administered or serviced) Master Collateral Vehicles in
accordance with this Agreement and the Financing Documents and duly perform all
of its obligations specified herein and therein. The Master Servicer shall
have full power and authority, acting alone or through any party properly
designated by it hereunder, to do any and all things in connection with its
servicing and administration duties which it may deem necessary or desirable to
accomplish such servicing and administration duties and which does not
materially adversely affect the interests of any Beneficiary, unless otherwise
prohibited by applicable Financing Documents or applicable law and regulations.
Nothing in this Agreement shall at any time prevent the Master Servicer from in
good faith taking any action to assure that its systems and records relating to
the Master Collateral Vehicles and the Financing Sources are at all times
accurate.
SECTION 3.3. The Master Servicer Not to Resign. Without the prior
written consent of the Master Collateral Agent, each of the Financing Sources
and Beneficiaries, and the Rating
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Agencies, the Master Servicer shall not resign from the obligations and duties
imposed on it hereunder.
SECTION 3.4. Servicing Rights of Master Collateral Agent. If the
Master Servicer resigns or shall fail to perform any of its obligations
hereunder, which failure adversely affects one or more Beneficiaries to a
material degree, the Master Collateral Agent, at the direction and at the
expense of the Beneficiaries so adversely affected thereby, shall take such
action or cause such action to be taken (pursuant to Section 4.1(d)), to
perform such obligations as shall be so directed by such Beneficiaries,
whereupon the Master Collateral Agent shall have full right and authority to
take or cause to be taken such action so directed, provided, that, such action
or direction is permitted by the related Financing Documents or this Agreement
and that the Master Collateral Agent is indemnified to its satisfaction in
connection therewith.
SECTION 3.5. Incumbency Certificate. With the delivery of this Master
Collateral Agency Agreement and from time to time thereafter, each Servicer,
RCFC and the Master Servicer shall furnish to the Master Collateral Agent a
certificate (each, an "Incumbency Certificate") certifying as to the incumbency
and specimen signatures of officers of each Servicer, RCFC and the Master
Servicer, respectively (the "Authorized Agents"), authorized to act, and to
give instructions and notices, on behalf of each such Servicer, RCFC and the
Master Servicer, respectively, hereunder. Until the Master Collateral Agent
receives a subsequent Incumbency Certificate, the Master Collateral Agent shall
be entitled to rely on the last such Incumbency Certificate delivered to it for
purposes of determining the Authorized Agents.
ARTICLE IV
THE MASTER COLLATERAL AGENT
SECTION 4.1. Appointment. (a) Each Financing Source and each
Beneficiary, by its execution of this Agreement, appoints Bankers Trust Company
as the Master Collateral Agent under and for purposes of this Agreement. Each
Financing Source and each Beneficiary authorizes the Master Collateral Agent to
act on behalf of such Financing Source and Beneficiary under this Agreement
and, in the absence of other written instructions from a Beneficiary with
respect to its Related Vehicles and Related Master Collateral as may be
received from time to time by the Master Collateral Agent (with respect to
which the Master Collateral Agent agrees that it will comply), subject to the
other provisions of this Article IV, to exercise such powers hereunder as are
specifically delegated to or required of the Master Collateral Agent by the
terms hereof and to exercise such powers as are provided to each Financing
Source and Beneficiary with respect to its Related Vehicles and other Related
Master Collateral under the related Financing Documents, along with such powers
as may be reasonably incidental thereto. The Master Collateral Agent is hereby
irrevocably appointed the true and lawful attorney-in-fact of each of the
Beneficiaries, in its name and stead, for such purposes as are necessary or
desirable to effectuate the provisions of this Agreement, including, without
limitation, in exercising remedies
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upon or otherwise dealing with the Master Collateral. Each such power of
attorney is irrevocable and coupled with an interest.
(b) If and whenever a Default shall have occurred and be continuing,
the Master Collateral Agent may and, at the direction of the applicable related
Beneficiary (as provided in the next succeeding sentence) shall, exercise from
time to time any rights and remedies available to it under applicable law or
any Financing Document. If any Beneficiary notifies the Master Collateral
Agent in writing that it or the Master Collateral Agent has the right to act
with respect to the Beneficiary's related Master Collateral pursuant to its
related Financing Documents or pursuant to the UCC as in effect in the
applicable jurisdiction, then the Master Collateral Agent, if it has been
indemnified to its satisfaction and is legally able to do so, shall exercise or
arrange for the exercise of any and all rights, remedies, powers and privileges
available to such Beneficiary or the Master Collateral Agent with respect to
the Beneficiary's related Master Collateral to the extent and in the manner
directed by such Beneficiary, at such Beneficiary's expense and subject to the
other provisions of this Agreement (including, without limitation, Section
4.4(g)), as permitted under the related Financing Documents and under relevant
law and regulations, including, without limitation, the transmission of notices
of default, repossession of Related Vehicles, and the institution of legal or
administrative actions or proceedings. Each of the Lessee Grantors, RCFC, the
Beneficiaries and the Financing Sources agrees that the Master Collateral Agent
may exercise such rights, remedies, powers and privileges assigned to it or in
lieu of a Beneficiary in accordance with the preceding sentence and agrees that
the Grantors shall reimburse the Master Collateral Agent for such enforcement
expenses only to the same extent that they would be obligated to reimburse the
Master Collateral Agent or the applicable Beneficiary for such enforcement
expenses pursuant to the related Financing Documents.
(c) Instructions given to the Master Collateral Agent by any
Beneficiary shall comply (and delivery of any such instructions by a
Beneficiary to the Master Collateral Agent shall be deemed to be a
representation and warranty by such Beneficiary that such instructions comply)
with the Financing Documents of such Beneficiary and with applicable law and
regulations.
(d) The Master Collateral Agent may at any time delegate any duties or
obligations hereunder (including, but not limited to, any duties or obligations
arising pursuant to Section 3.4 or 4.1(b) hereof) to any Person (other than,
with respect to any actions as agent of the Beneficiaries as secured parties,
any Person with any other interest in the Master Collateral) who agrees to
conduct such duties in accordance with the terms hereof. Any such delegation
shall not constitute a resignation within the meaning of Section 4.5 hereof and
the Master Collateral Agent shall not be liable for the negligence, acts or
omissions of such Persons so long as such Persons are selected with due care.
If any such delegation occurs, notification of the identity of such Person
shall be given to the Servicer, the Beneficiaries and the Rating Agencies.
(e) If, at the time a Default exists under the Financing Documents
related to a Beneficiary, the Master Collateral Agent shall default in its
obligation or for any reason be unwilling or legally unable to exercise the
rights, remedies, powers or privileges with respect to the Related Master
Collateral of a Beneficiary in accordance with the direction of such
Beneficiary (including any
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rights under Section 3.4 or 4.1(b)), the Master Collateral Agent shall, upon
the written request of such Beneficiary, assign (without recourse to the Master
Collateral Agent) to such Beneficiary the Master Collateral Agent's security
interest in such Beneficiary's Master Collateral and shall prepare and execute
those instruments and documents necessary to effectuate such assignment
(including, if necessary, the execution of documents necessary to change the
name of the first lienholder on Certificates of Title for such Beneficiary's
Related Vehicles to such Beneficiary or its agent or assignee).
(f) Bankers Trust Company, in its individual or in any other capacity
(including as Trustee), may be a Beneficiary hereunder and as such shall be
entitled to all of the protections and rights of a Beneficiary under this
Agreement without regard to its capacity as Master Collateral Agent hereunder.
(g) Within three (3) Business Days of receipt by the Master Collateral
Agent from a Manufacturer of any material information pertaining to payments of
Disposition Proceeds, Guaranteed Payments, Repurchase Payments, or Incentive
Payments, or any payments arising under the Subleases, made or to be made to
the Master Collateral Account, the Master Collateral Agent shall provide such
information to the Master Servicer.
SECTION 4.2. Representations. Bankers Trust Company hereby represents
and warrants that (i) it has all requisite corporate power and authority to
enter into and perform its obligations under this Agreement and (ii) the
execution, delivery and performance by it of this Agreement have been duly
authorized by all necessary corporate action on its part, and this Agreement is
the legal, valid and binding obligation of Bankers Trust Company, enforceable
against it in accordance with its terms, except as such enforcement may be
limited by applicable bankruptcy, insolvency, moratorium or similar laws
affecting creditors' rights generally and by the application of equitable
principles.
SECTION 4.3. Exculpatory Provisions. The Master Collateral Agent makes
no representations as to the value or condition of the Master Collateral or any
part thereof, the status or designation of any Master Collateral Vehicle as a
Related Vehicle to any Beneficiary pursuant to Section 2.2 hereof, as to the
title of any Lessee Grantor or RCFC thereto, as to the protection afforded by
this Agreement, as to the Fleet Report, any statements, representations or
warranties made by any other Person in or in connection with this Agreement or
any Financing Document, as to the validity, execution (except its own
execution), enforceability of this Agreement (except as against itself),
priority, perfection, legality or sufficiency of this Agreement or any
Financing Document or any documents or instruments referred to therein, or the
sufficiency or effectiveness or perfection or priority of any Lien on any
collateral described in this Agreement, or as to the validity or collectibility
of any obligation contemplated by this Agreement, and the Master Collateral
Agent shall incur no liability or responsibility in respect of any such
matters; provided, however, that the Master Collateral Agent shall not be
relieved from liability for its own gross negligence or willful misconduct.
The Master Collateral Agent shall not be charged with knowledge of the contents
of any Fleet Report or any Financing Document. The Master Collateral Agent
shall not be responsible for insuring the Master Collateral. Any reference
herein
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to actual knowledge of the Master Collateral Agent shall mean actual knowledge
of a Responsible Officer of the Master Collateral Agent assigned to and working
in its Corporate Trust Office.
SECTION 4.4. Limitations on Powers and Duties of the Master Collateral
Agent. (a) The Master Collateral Agent undertakes to perform only the duties
expressly set forth herein and no implied duties shall be read into this
Agreement.
(b) The Master Collateral Agent may exercise the rights and powers
granted to it by this Agreement, together with such powers as are reasonably
incidental thereto, but only pursuant to the terms of this Agreement.
(c) The Master Collateral Agent's duty of care shall be solely to deal
with the Master Collateral as it would with property of its own.
(d) The Master Collateral Agent shall have no authority to grant,
convey or assign the Certificates of Title or change the notation of a security
interest thereon or deal with the Certificates of Title in any way except as
expressly provided herein.
(e) The Master Collateral Agent shall have no liability or
responsibility for (i) any release of Master Collateral or other act or
omission by a Servicer pursuant to Section 2.7 or 2.8, (ii) any act of a
Servicer taken in its own name or the name of the Master Collateral Agent, or
(iii) custody of any Certificates of Title not delivered to it and required to
be held by it in connection with this Agreement.
(f) The Master Collateral Agent shall have no duty to calculate,
compute or verify, and shall not be held in any manner responsible for the
content of the Fleet Report, except to verify that the certificate filed
therewith conforms to the form of Exhibit C.
(g) Except as required by the specific terms of this Agreement, the
Master Collateral Agent shall have no duty to exercise or to refrain from
exercising any right, power, remedy or privilege granted to it hereby, or to
take any affirmative action or refrain from taking any affirmative action
hereunder, unless directed to do so by Beneficiaries specified herein as being
entitled to direct the Master Collateral Agent hereunder (and shall be fully
protected in acting or refraining from acting pursuant to or in accordance with
such directions, which shall be binding on each Lessee Grantor, RCFC, and each
of the Financing Sources and Beneficiaries). Notwithstanding anything herein
to the contrary, the Master Collateral Agent shall not be required to take any
action that is or may be contrary to law or to the terms of this Agreement, any
Financing Document or any other agreement or instrument relating to the Master
Collateral, or which might subject it or any of its directors, officers,
employees or agents to personal or financial liability. If any indemnity
provided should become, in the determination of the Master Collateral Agent,
inadequate, the Master Collateral Agent may call for additional indemnity and
cease to act until and unless such additional indemnity is given.
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(h) The Master Collateral Agent may, in its sole discretion, retain
counsel, agents, independent accountants and other experts selected by it and
may act in reliance upon the advice of such counsel, independent accountants
and other experts concerning all matters pertaining to the agencies hereby
created and its duties hereunder, and shall be held harmless and shall not be
liable for any action taken or omitted to be taken by it in good faith in
reliance upon or in accordance with the statements and advice of such counsel,
agents, accountants and other experts. The Master Collateral Agent shall have
the right at any time to seek instructions concerning its duties and actions
under this Agreement from any court of competent jurisdiction.
(i) If the Master Collateral Agent receives unclear or conflicting
instructions, it shall be entitled to refrain from taking action until clear or
non-conflicting instructions are received, but shall inform the instructing
party or parties promptly of its decision to refrain from taking such action.
Without limiting the foregoing, in the event that the Master Collateral Agent
receives unclear or conflicting instructions from Beneficiaries hereunder or
there is any other disagreement between the other parties hereto resulting in
adverse claims and demands being made in connection with the Master Collateral,
or in the event that the Master Collateral Agent in good faith is in doubt as
to what action it should take hereunder, the Master Collateral Agent shall be
entitled to retain the Master Collateral until the Master Collateral Agent
shall have received (i) a final nonappealable order of a court of competent
jurisdiction directing delivery of the Master Collateral or (ii) a written
agreement executed by all the other parties hereto directing delivery of the
Master Collateral in which event the Master Collateral Agent shall disburse the
Master Collateral in accordance with such order or agreement. Any court order
shall be accompanied by a legal opinion by counsel for the presenting party
satisfactory to the Master Collateral Agent to the effect that such order is
final and nonappealable.
(j) The Master Collateral Agent shall not have any duty to ascertain or
to inquire as to the performance or observance of any of the terms, covenants
or conditions of this Agreement, any Financing Document or any other agreements
or instruments relating to the Master Collateral on the part of any party
hereto or thereto or to inspect any books and records relating to the Master
Collateral.
(k) The Master Collateral Agent shall be entitled to rely on any
communication, certificate, instrument, opinion, report, notice, paper or other
document reasonably believed by it to be genuine and correct and to have been
signed, given or sent by the proper Person or Persons. The Master Collateral
Agent shall be entitled to assume that no Default shall have occurred and be
continuing and that the Master Collateral Account, and any funds on deposit in
or to the credit of such Master Collateral Account, are not subject to any
writ, order, judgment, warrant of attachment, execution or similar process
(collectively a "writ"), unless (i) a Responsible Officer of the Master
Collateral Agent has actual knowledge thereof or (ii) the Master Collateral
Agent has received written notice from a Lessee Grantor, RCFC, a Servicer, the
Master Servicer, a Beneficiary or a Financing Source that such a Default has
occurred or such writ has been issued and, in each case, continues to be in
effect, which notice specifies the nature thereof.
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(l) Bankers Trust Company, in its individual capacity, may accept
deposits from, lend money to and generally engage in any kind of business with
any Lessee Grantor, any Financing Source, any Manufacturer and their respective
affiliates as if it were not the agent of the Beneficiaries or the Financing
Sources.
(m) The Master Collateral Agent shall not be accountable for the use or
application by any person of disbursements properly made by the Master
Collateral Agent in conformity with the provisions of this Agreement.
(n) The Master Collateral Agent may exercise any of its duties
hereunder by or through agents or employees in accordance with Section 4.1(d).
The possession of the Master Collateral by such agents or employees shall be
deemed to be the possession of the Master Collateral Agent. No provision of
this Agreement shall require the Master Collateral Agent to expend or risk its
own funds or otherwise incur any financial or other liability in the
performance of any duties hereunder or in the exercise of any rights and powers
hereunder unless the Master Collateral Agent is provided with an indemnity from
one or more Beneficiaries, satisfactory to the Master Collateral Agent in its
sole discretion.
SECTION 4.5. Resignation and Removal of Master Collateral Agent. (a)
The Master Collateral Agent may, at any time with or without cause by giving
forty-five (45) days' prior written notice to the Master Servicer, RCFC, the
Financing Sources and the Beneficiaries, resign and be discharged of its
responsibilities hereunder created, such resignation to become effective upon
the appointment by the Master Servicer and RCFC of a successor Master
Collateral Agent with the approval of the Required Beneficiaries (which
approval shall not be unreasonably withheld) and the acceptance of such
appointment by such successor Master Collateral Agent or the appointment
thereof by a court of competent jurisdiction (as and to the extent provided in
the related Financing Documents). The Master Servicer and RCFC shall, promptly
upon receipt thereof, provide a copy of the notice from the Master Collateral
Agent referred to in the preceding sentence to each Rating Agency. The Master
Collateral Agent may be removed by the Master Servicer or RCFC at any time
(with or without cause) upon thirty (30) days' written notice by the Master
Servicer or RCFC, as the case may be, to the Master Collateral Agent and each
of the Rating Agencies, and the approval of the successor Master Collateral
Agent by the Required Beneficiaries, which approval will not be unreasonably
withheld; provided, however, that if either the Master Servicer or RCFC is in
default under this Agreement or any Financing Document and such default has a
material adverse effect on the Beneficiaries, then so long as such default
continues, the right of the Master Servicer or RCFC, as applicable, to remove
the Master Collateral Agent shall cease and the non-defaulting party shall
have, or if both the Master Servicer and RCFC are then in default, then the
Required Beneficiaries shall have the right to remove the Master Collateral
Agent (with or without cause) upon thirty (30) days' written notice to the
Master Servicer RCFC, the Master Collateral Agent and each of the Rating
Agencies; provided, further, that no removal of the Master Collateral Agent
shall be effective until the appointment of a successor Master Collateral Agent
and acceptance of such appointment by such Master Collateral Agent. Any
removed Master Collateral Agent shall be entitled to its reasonable fees and
expenses to the date the successor Master Collateral Agent assumes the Master
Collateral
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Agent's duties hereunder. The indemnification of Section 4.10 shall survive
the termination of the other provisions of this Agreement as to the predecessor
Master Collateral Agent. If no successor Master Collateral Agent shall be
appointed and approved within thirty (30) days from the date of the giving of
the aforesaid notice of resignation or within thirty (30) days from the date of
such notice of removal, the Master Collateral Agent, on behalf of the Master
Servicer and RCFC, each Financing Source and each Beneficiary may appoint a
successor Master Collateral Agent to act until such time, if any, as a
successor Master Collateral Agent shall be appointed as above provided. If a
successor Master Collateral Agent does not take office within thirty (30) days
after the retiring Master Collateral Agent resigns or is removed, the retiring
Master Collateral Agent, on behalf of the Master Servicer and RCFC, each
Financing Source and each Beneficiary may petition any court of competent
jurisdiction for the appointment of a successor Master Collateral Agent. Any
successor Master Collateral Agent so appointed by such court shall immediately
without further act supersede any predecessor Master Collateral Agent. Upon
the appointment of a successor Master Collateral Agent hereunder, the
predecessor Master Collateral Agent shall be discharged of and from any and all
further obligations arising in connection with this Agreement.
(b) The appointment and designation referred to in Section 4.5(a)
shall, after any required filing, be full evidence of the right and authority
to make the same and of all the facts therein recited, and this Agreement shall
vest in such successor Master Collateral Agent, without any further act, deed
or conveyance, all of the estate and title of its predecessors and upon such
filing for record the successor Master Collateral Agent shall become fully
vested with all the estates, properties, rights, powers, duties, authority and
title of its predecessors; but any predecessor Master Collateral Agent shall,
nevertheless, on payment of its charges and on the written request of the
Required Beneficiaries, the Master Servicer, RCFC or any successor Master
Collateral Agent empowered to act as such at the time any such request is made,
execute and deliver an instrument without recourse or representation
transferring to such successor all the estates, properties, rights, powers,
duties, authority and title of such predecessor hereunder and shall deliver all
securities, deposits and monies held by it to such successor Master Collateral
Agent.
SECTION 4.6. Status of Successors to Master Collateral Agent. Every
successor to the Master Collateral Agent appointed pursuant to Section 4.5
shall be a bank or trust company in good standing and having power so to act
and incorporated under the laws of the United States or any State thereof or
the District of Columbia, and shall also have capital, surplus and undivided
profits of not less than $50,000,000 if there be such an institution with such
capital, surplus and undivided profits willing, qualified and able to accept
the trust upon reasonable or customary terms. The Master Servicer shall give
the Rating Agencies written notice prior to any successor Master Collateral
Agent being appointed pursuant to Section 4.5.
SECTION 4.7. Merger of the Master Collateral Agent. Any corporation
into which the Master Collateral Agent shall be merged, or with which it shall
be converted or consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Master Collateral Agent shall be a
party shall be the Master Collateral Agent under this Agreement without the
execution or filing of any paper or any further act on the part of the parties
hereto.
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The Master Collateral Agent shall give the Rating Agencies, the Master
Servicer, RCFC and the Servicer written notice (which, if practicable, shall be
prior written notice) of any such merger, conversion or consolidation.
SECTION 4.8. Compensation and Expenses. The Lessee Grantors, jointly
and severally, shall pay to the Master Collateral Agent, from time to time (i)
compensation for its services hereunder for administering the Master Collateral
as set forth in the fee letter dated as of December 21, 1995, between Thrifty
and the Master Collateral Agent, as such letter may be amended, modified or
supplemented from time to time, and (ii) all reasonable fees and out-of-pocket
expenses (including the fees and expenses of counsel) of the Master Collateral
Agent (A) arising in connection with the preparation, execution, delivery, or
modification of this Agreement and/or the enforcement of any of the provisions
hereof or (B) incurred in connection with the administration of the Master
Collateral, the sale or other disposition of Master Collateral pursuant to this
Agreement or to any Financing Document and/or the preservation, protection or
defense of the Master Collateral Agent's rights under this Agreement and the
Financing Documents and in and to the Master Collateral.
SECTION 4.9. Stamp, Other Similar Taxes and Filing Fees. The Lessee
Grantors, jointly and severally, shall indemnify and hold harmless the Master
Collateral Agent from any present or future claim for liability for any stamp
or other similar tax and any penalties or interest with respect thereto, that
may be assessed, levied or collected by any jurisdiction in connection with
this Agreement or any Master Collateral. The Lessee Grantors, jointly and
severally, shall pay, or reimburse the Master Collateral Agent for, any and all
amounts in respect of all search, filing, recording and registration fees,
taxes, excise taxes and other similar imposts that may be payable or determined
to be payable in respect of the execution, delivery, performance and/or
enforcement of this Agreement. Nothing in this Section 4.9 shall relieve the
Master Servicer of its responsibility and liability for filings and recordings
with respect to this Agreement and the Master Collateral.
SECTION 4.10. Indemnification. The Lessee Grantors, jointly and
severally, shall pay, and indemnify and hold the Master Collateral Agent and
each of the officers, employees, directors and agents thereof harmless from and
against, any and all liabilities (including liabilities for penalties and
liabilities arising or resulting from actions or suits), obligations, losses,
judgments, demands, damages, claims, costs or expenses of any kind or nature
whatsoever that may at any time be imposed on, incurred by, or asserted
against, the Master Collateral Agent or any such officers, employees, directors
or agents in any way relating to or arising out of the execution, delivery,
amendment, enforcement, performance and/or administration of this Agreement,
including reasonable fees and expenses of counsel and other experts, and the
Lessee Grantors, jointly and severally, shall reimburse each Beneficiary for
any payments made by such Beneficiary to the Master Collateral Agent or any
such officers, employees, directors or agents for any of the foregoing;
provided, however, that the Lessee Grantors shall not be liable for the payment
of any portion of such liabilities (including liabilities for penalties and
liabilities arising or resulting from actions or suits), obligations, losses,
judgments, demands, damages, claims, costs or expenses of the Master Collateral
Agent or any such officers, employees, directors or agents which resulted
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from the gross negligence or willful misconduct of the Master Collateral Agent
or any such agent. The Master Collateral Agent shall not be responsible for
the negligence of any agent appointed with due care.
Each of the Beneficiaries (other than the Trustee) agrees, in accordance
with its pro rata portion of the Master Collateral, to indemnify and hold the
Master Collateral Agent and each of its officers, employees, directors and
agents harmless to the same extent as the Lessee Grantors in accordance with
the foregoing paragraph but only to the extent that the Master Collateral Agent
has not been paid by the Lessee Grantors pursuant to such paragraph. This
Section 4.10 shall survive the termination of this Agreement and the
resignation or removal of the Master Collateral Agent.
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Amendments, Supplements and Waivers. This Agreement may
be amended, waived, terminated, supplemented or otherwise modified pursuant to
a writing executed by the Master Collateral Agent, each Beneficiary, each
Financing Source, each Lessee Grantor, each Servicer, RCFC and the Master
Servicer; provided, however, that (i) the consent of each Beneficiary and each
Financing Source need not be obtained in connection with the execution of a
supplement or amendment that only adds a Financing Source or Beneficiary as a
party to this Agreement and (ii) an amendment may be executed without the
consent of any Beneficiary or any Financing Source if such amendment is
effected only to cure an ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein or which is
otherwise defective, or to make any other provisions with respect to matters or
questions arising under this Agreement which shall not be inconsistent with the
provisions of this Master Collateral Agency Agreement or any other such Related
Document; provided, that such action pursuant to this clause shall not have a
material adverse effect on the interests of any Beneficiary or any Financing
Source in any material respect. Additional Financing Sources or Beneficiaries
may from time to time become parties hereto and Financing Sources or
Beneficiaries hereunder by the execution of a Financing Source and Beneficiary
Supplement by such additional Financing Source or Beneficiary, the Master
Collateral Agent, the Servicer and each Lessee Grantor. The Master Servicer
shall give the Rating Agencies prior written notice of any amendment,
supplement, waiver or modification of this Agreement. The Master Collateral
Agent shall be entitled to receive upon request an Opinion of Counsel stating
that such amendment, supplement, waiver or modification of this Agreement is in
compliance with and is not prohibited by this Agreement and the Financing
Documents. Upon execution of a Financing Source and Beneficiary Supplement,
the Master Servicer shall furnish a copy thereof to the other parties hereto.
SECTION 5.2. Notices. All notices, requests, demands and other
communications provided for or permitted hereunder shall, unless otherwise
stated herein, be in writing (including
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facsimile communications) and shall be sent by registered or certified mail,
return receipt requested, facsimile or hand delivery
(a) if to a Lessee Grantor, a Servicer, the Master Servicer,
RCFC or the Master Collateral Agent, at the address specified for such
party on the signature pages hereto; or
(b) if to any other Beneficiary, Financing Source or other
Person specified in a Financing Source and Beneficiary Supplement, at
the address specified in such Financing Source and Beneficiary
Supplement;
or, in each case, at such other address as shall be designated by it in a
written notice to each other party hereto. Any notice, if mailed and properly
addressed with postage prepaid or if properly addressed and sent by pre-paid
courier service or if transmitted by facsimile shall be deemed given when
received.
Notwithstanding the foregoing, any notice, request, demand or
communication to the Master Collateral Agent, in its capacity as the first
lienholder noted on the Certificate of Title, shall be mailed, postage prepaid,
to the following address, as applicable:
For Dollar:
Re: "DTAG"
c/o Bankers Trust Company
P.O. Box 35588
Tulsa, Oklahoma 74153
For Thrifty:
Re: "DTAG"
c/o Bankers Trust Company
P.O. Box 35686
Tulsa, Oklahoma 74153
SECTION 5.3. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall not invalidate the
remaining provisions hereof, and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
SECTION 5.4. Counterparts. This Agreement may be executed in separate
counterparts and by the different parties on different counterparts, each of
which shall be an original and all of which taken together shall constitute one
and the same instrument.
SECTION 5.5. Conflicts with Financing Documents; Reservation of Rights.
The parties agree that in the event of any conflict between the provisions of
this Agreement and the provisions of any Financing Documents, the provisions of
this Agreement shall control. Except as expressly provided herein, nothing
contained in this Agreement is intended to affect or limit, in any way, the
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rights that each of the Beneficiaries has insofar as the rights of such parties
and third parties are involved. Except as expressly provided herein, the
Beneficiaries specifically reserve all their respective rights against each
Lessee Grantor, any Financing Source and/or any third party.
SECTION 5.6. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of each of the parties hereto and their respective
successors and assigns. Nothing herein is intended or shall be construed to
give any other Person any right, remedy or claim under, to or in respect of
this Agreement or the Master Collateral.
SECTION 5.7. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.
SECTION 5.8. Effectiveness. This Agreement shall become effective on
the execution and delivery hereof and shall remain in effect until no amounts
are owed to any Financing Source under any Financing Document and no
Beneficiary or Financing Source shall have any claim on the Master Collateral.
SECTION 5.9. Termination of Beneficiary. Upon receipt by the Master
Collateral Agent of a notice from a Beneficiary to the effect that (i) (A) such
Beneficiary then has no Related Vehicles hereunder, no amounts are then owing
to the related Financing Source under its Financing Documents and such
Financing Documents have been terminated and are of no further force or effect
or (B) the Master Collateral Agent's security interest has been reassigned to
such Beneficiary pursuant to Section 4.1(e) and (ii) such Beneficiary has
elected to terminate this Agreement, this Agreement shall terminate as to such
Beneficiary.
SECTION 5.10. Termination of this Agreement. At any time that there
are no Beneficiaries, the Lessee Grantors and RCFC may terminate this Agreement
upon notice to the Master Collateral Agent, and the Master Collateral Agent
shall take all actions reasonably requested by the Lessee Grantors and RCFC, at
the joint and several expense of the Lessee Grantors, to evidence the
termination of this Agreement and the Master Collateral Agent's interest in the
Master Collateral, including, without limitation, execute such documents and
instruments as RCFC or any Lessee Grantor may prepare and reasonably request to
be executed by the Master Collateral Agent in connection with such
reassignment; provided, however, that Sections 4.3, 4.4(a), (c), and (e)
through (n), 4.8, and the indemnification set forth in Sections 4.9 and 4.10
shall survive the termination of this Agreement.
SECTION 5.11. Assignment by Financing Sources. Each Financing Source
acknowledges that it has assigned and does hereby assign to its related
Beneficiary or Beneficiaries all of its rights and interests under this
Agreement and further acknowledges that its related Beneficiary or
Beneficiaries may exercise all of such Financing Source's rights hereunder
assigned thereto.
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SECTION 5.12. RCFC Related Documents. To the extent that this
Agreement affects the secured parties under RCFC's Financing Documents, it
shall be considered a Related Document (as defined in RCFC's Financing
Documents) for all purposes except voting provisions.
SECTION 5.13. No Bankruptcy Petition Against Financing Sources. The
Master Collateral Agent hereby covenants and agrees that, prior to the date
which is one year and one day after the payment in full of the latest maturing
debt security issued by a Financing Source, it will not institute against, or
join with any other Person in instituting against, such Financing Source, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any Federal or state bankruptcy or similar law;
provided, however, that nothing in this Section 5.13 shall constitute a waiver
of any right to indemnification, reimbursement or other payment from any
Financing Source or Beneficiary pursuant to this Agreement; provided, further,
that this Section 5.13 shall only be effective with respect to a Financing
Source for which the related Financing Documents contain a "no bankruptcy
petition" provision similar to this Section 5.13. In the event that the Master
Collateral Agent takes action in violation of this Section 5.13, each affected
Financing Source agrees that it shall file an answer with the bankruptcy court
or otherwise properly contest the filing of such a petition by the Master
Collateral Agent against such Financing Source or the commencement of such
action and raise the defense that the Master Collateral Agent has agreed in
writing not to take such action and should be estopped and precluded therefrom
and such other defenses, if any, as its counsel advises that it may assert.
The provisions of this Section 5.13 shall survive the termination of this
Agreement, and the resignation or removal of the Master Collateral Agent.
SECTION 5.14. Jurisdiction; Consent to Service of Process. ALL
JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY LESSEE GRANTOR, THE MASTER SERVICER,
THE MASTER COLLATERAL AGENT, ANY FINANCING SOURCE OR ANY BENEFICIARY WITH
RESPECT TO THIS AGREEMENT OR ANY OTHER RELATED DOCUMENT MAY BE BROUGHT IN ANY
STATE COURT OR (TO THE EXTENT PERMITTED BY LAW) FEDERAL COURT OF COMPETENT
JURISDICTION IN THE BOROUGH OF MANHATTAN, IN NEW YORK CITY, IN THE STATE OF NEW
YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH LESSEE GRANTOR, THE
MASTER SERVICER, THE MASTER COLLATERAL AGENT, EACH FINANCING SOURCE AND EACH
BENEFICIARY ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY
AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS, AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH THIS AGREEMENT. EACH LESSEE GRANTOR, THE MASTER SERVICER, EACH FINANCING
SOURCE AND EACH BENEFICIARY (OTHER THAN THE TRUSTEE) DESIGNATES AND APPOINTS CT
CORPORATION SYSTEM, INC., 1633 BROADWAY, NEW YORK, NEW YORK 10019, AND SUCH
OTHER PERSONS AS MAY HEREAFTER BE SELECTED BY A LESSEE GRANTOR, THE MASTER
SERVICER, ANY FINANCING SOURCE OR ANY BENEFICIARY AND AS SHALL
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IRREVOCABLY AGREE IN WRITING TO SERVE, AS ITS AGENT TO RECEIVE ON ITS BEHALF
SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDINGS IN ANY SUCH COURT, SUCH SERVICE
BEING HEREBY ACKNOWLEDGED BY EACH LESSEE GRANTOR, THE MASTER SERVICER, EACH
FINANCING SOURCE AND EACH BENEFICIARY (OTHER THAN THE TRUSTEE) TO BE EFFECTIVE
AND BINDING SERVICE IN EVERY RESPECT. A COPY OF SUCH PROCESS SO SERVED SHALL
BE MAILED BY REGISTERED MAIL TO EACH LESSEE GRANTOR, THE MASTER SERVICER, SUCH
FINANCING SOURCE OR SUCH BENEFICIARY SO SERVED AT ITS ADDRESS PROVIDED IN THE
APPLICABLE SIGNATURE PAGE HERETO, EXCEPT THAT, UNLESS OTHERWISE PROVIDED BY
APPLICABLE LAW, ANY FAILURE TO MAIL SUCH COPY SHALL NOT AFFECT THE VALIDITY OF
SERVICE OF PROCESS. IF ANY AGENT APPOINTED BY A LESSEE GRANTOR, THE MASTER
SERVICER, SUCH FINANCING SOURCE OR SUCH BENEFICIARY REFUSES TO ACCEPT SERVICE,
EACH LESSEE GRANTOR, THE MASTER SERVICER, EACH FINANCING SOURCE AND EACH
BENEFICIARY HEREBY AGREES THAT SERVICE UPON IT BY MAIL SHALL CONSTITUTE
SUFFICIENT NOTICE. NOTHING HEREIN SHALL AFFECT THE RIGHTS TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF ANY FINANCING
SOURCE OR BENEFICIARY TO BRING PROCEEDINGS AGAINST ANY LESSEE GRANTOR OR THE
MASTER SERVICER IN THE COURTS OF ANY OTHER JURISDICTION.
SECTION 5.15. Waiver of Jury Trial. THE MASTER COLLATERAL AGENT, EACH
FINANCING SOURCE, EACH BENEFICIARY AND EACH LESSEE GRANTOR, AND THE MASTER
SERVICER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY
MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR
ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER
RELATED DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE MASTER COLLATERAL AGENT, ANY
FINANCING SOURCE, ANY BENEFICIARY, ANY LESSEE GRANTOR OR THE MASTER SERVICER IN
CONNECTION HEREWITH OR THEREWITH. EACH LESSEE GRANTOR, AND THE MASTER SERVICER
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION
FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH OTHER RELATED DOCUMENT TO
WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE
MASTER COLLATERAL AGENT, EACH FINANCING SOURCE AND EACH BENEFICIARY ENTERING
INTO THIS AGREEMENT AND EACH SUCH OTHER RELATED DOCUMENT.
SECTION 5.16. Insurance Notification. The Master Collateral Agent
shall, promptly upon its receipt of written notification of any termination of
or proposed cancellation or nonrenewal of any insurance policies required to be
maintained under any of the Financing
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Documents, notify the Beneficiary thereof of any such termination, proposed
cancellation or nonrenewal.
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IN WITNESS WHEREOF, each party hereto has executed this Agreement or
caused this Agreement to be duly executed by its officer thereunto duly
authorized as of the day and year first above written.
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.,
as Master Servicer
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
RENTAL CAR FINANCE CORP.,
as grantor
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
THRIFTY RENT-A-CAR SYSTEM, INC.,
as grantor and as servicer
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
-39-
<PAGE> 44
DOLLAR RENT A CAR SYSTEMS, INC.,
as grantor and as servicer
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
BANKERS TRUST COMPANY,
not in its individual capacity
but solely as Master Collateral
Agent
By:
---------------------------------
Name:
Title:
Address: Corporate Trust and Agency
Group
Four Albany Street
New York, New York 10006
Attention: Structured Finance
Group
-40-
<PAGE> 45
EXHIBIT A
GRANTOR SUPPLEMENT TO AMENDED AND
RESTATED MASTER COLLATERAL AGENCY AGREEMENT
This GRANTOR SUPPLEMENT to the Master Collateral Agency Agreement, dated
as of December 13, 1995 (as heretofore amended, amended and restated,
supplemented or otherwise modified from time to time in accordance with the
terms thereof, the "Amended and Restated Master Collateral Agency Agreement"),
among BANKERS TRUST COMPANY, as Master Collateral Agent, DOLLAR THRIFTY
AUTOMOTIVE GROUP, as Master Servicer, RENTAL CAR FINANCE CORP., as a grantor
("RCFC"), THRIFTY RENT-A-CAR SYSTEM, INC., as a grantor and servicer
("Thrifty"), DOLLAR RENT A CAR SYSTEMS, INC., as a grantor and servicer
("Dollar"), and each additional grantor that has previously executed a Grantor
Supplement (each an "Additional Grantor" and, together with RCFC, Thrifty and
Dollar, the "Lessee Grantors") is entered into as of ________, 19__, among the
Master Collateral Agent, the Master Servicer, each of the Lessee Grantors and
________ ("New Grantor").
WHEREAS, the Master Collateral Agent, the Master Servicer and each of
the Lessee Grantors have entered into the Amended and Restated Master
Collateral Agency Agreement or a Grantor Supplement thereto, and the Master
Collateral Agent, the Master Servicer and the Lessee Grantors now desire to add
an additional grantor party to such Agreement.
NOW, THEREFORE, the parties agree as follows:
SECTION 1. Definitions. All capitalized terms used but not defined
herein shall have the meanings assigned to such terms in the Amended and
Restated Master Collateral Agency Agreement (including by reference therein to
the Definitions List attached as Schedule 1 to the Base Indenture).
SECTION 2. Amended and Restated Master Collateral Agency Agreement;
Grant of Security Interest. New Grantor hereby acknowledges receipt of an
executed copy of the Amended and Restated Master Collateral Agency Agreement.
New Grantor hereby becomes a Lessee Grantor under the Amended and Restated
Master Collateral Agency Agreement. New Grantor hereby agrees to be bound by
the terms of the Amended and Restated Master Collateral Agency Agreement as a
Lessee Grantor thereunder. As security for the payment of the obligations from
time to time owing by New Grantor to each Financing Source (or any Beneficiary
as assignee thereof) under the related Financing Documents, New Grantor hereby
grants, pledges and assigns to the Master Collateral Agent for the benefit of
each Financing Source (or any Beneficiary as assignee thereof) a continuing,
first priority security interest in all
<PAGE> 46
right, title and interest of New Grantor in, to and under the following,
whether existing or acquired as of the date hereof or hereafter (the "New
Grantor Master Collateral"):
(a) all vehicles (A) acquired, financed or refinanced with funds
provided by any Financing Source or Beneficiary and identified as Lessee
Grantor Master Collateral Vehicles related to New Grantor in any Fleet
Reports delivered to the Master Collateral Agent and/or (B) identified
as being owned by New Grantor and subject to the lien of the Master
Collateral Agent in each case on the Certificates of Title thereof and
all Certificates of Title with respect thereto;
(b) the Master Collateral Account, all funds on deposit therein
from time to time, all certificates and instruments, if any,
representing or evidencing any or all of the Master Collateral Account
or the funds on deposit therein from time to time, and all Permitted
Investments made at any time and from time to time with the funds on
deposit in the Master Collateral Account (including income thereon) and
all certificates and instruments, if any, representing or evidencing
such Permitted Investments;
(c) all Vehicle Disposition Programs and incentive programs
applicable to Lessee Grantor Master Collateral Vehicles, to the extent
such right, title and interest relates to such Lessee Grantor Master
Collateral Vehicles, including any amendments thereof and all monies due
and to become due in respect of such Lessee Grantor Master Collateral
Vehicles under or in connection with each such Vehicle Disposition
Program and incentive program, whether payable as Repurchase Payments,
Guaranteed Payments, Disposition Proceeds, Incentive Payments, auction
sales proceeds, fees, expenses, costs, indemnities, insurance
recoveries, damages for breach of any Vehicle Disposition Program or
otherwise and all rights to compel performance and otherwise exercise
rights and remedies thereunder;
(d) all Subleases entered into by New Grantor the subject of
which includes any Master Collateral Vehicle leased by RCFC to New
Grantor under a Lease, and all other contracts, agreements, guarantees,
insurance, warranties, instruments or certificates entered into or
delivered to New Grantor in connection with any such Sublease, in each
case only to the extent directly relating to any Master Collateral
Vehicle, including (but only to such extent), without limitation, all
monies due and to become due to New Grantor under or in connection with
such agreements whether payable as rent, guaranty payments, fees,
expenses, costs, indemnities, insurance recoveries, damages for the
breach of any of the agreements or otherwise, and all rights, remedies,
powers, privileges and claims of New Grantor against any other party
under or with respect to such agreements (whether arising pursuant to
the terms of such agreements or otherwise available to New Grantor at
law or in equity), including the right to enforce any of the agreements
as provided herein and to give or withhold any and all consents,
requests, notices, directions, approvals, extensions or waivers under or
with respect to the agreements or the
A-2
<PAGE> 47
obligations of any party thereunder, all liens and property from time to
time purporting to secure payment arising under or in connection with
such agreements, or assigned to, New Grantor describing any collateral
securing such obligations or liabilities and all guarantees, insurance
and other agreements or arrangements of whatever character from time to
time supporting or securing payment of such obligations and liabilities
due to New Grantor pursuant to such agreements);
(e) all Assignment Agreements entered into by New Grantor;
(f) all payments under insurance policies (whether or not the
Master Collateral Agent is named as the loss payee thereof) with respect
to any of the Lessee Grantor Master Collateral Vehicles;
(g) all additional property that may on the Closing Date or from
time to time hereafter be subjected to the grant and pledge under this
Agreement, as the same may be modified or supplemented from time to
time, by New Grantor or by anyone on its behalf; and
(h) any and all proceeds, products, offspring, rents or profits
of any and all of the foregoing.
SECTION 3. Notice Addresses. Any notice to be given to the New Grantor
shall be sent as set forth in the Amended and Restated Master Collateral Agency
Agreement to the New Grantor at the following address:
(New Grantor)
------------------------
SECTION 4. Counterparts. This Grantor Supplement may be executed in
separate counterparts and by the different parties on different counterparts,
each of which shall constitute an original and all of which when taken together
shall constitute one and the same agreement.
SECTION 5. GOVERNING LAW. THIS GRANTOR SUPPLEMENT SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
(Remainder of Page Intentionally Blank)
A-3
<PAGE> 48
IN WITNESS WHEREOF, each party hereto has executed this Grantor
Supplement or caused this Grantor Supplement to be duly executed by their
respective officers duly authorized as of the day and year first above written.
BANKERS TRUST COMPANY,
not in its individual capacity but
solely as Master Collateral Agent
By:
---------------------------------
Name:
Title:
Address:
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.,
as Master Servicer
By:
---------------------------------
Name:
Title:
Address:
RENTAL CAR FINANCE CORP.,
as a Grantor and Servicer
By:
---------------------------------
Name:
Title:
Address:
A-4
<PAGE> 49
THRIFTY RENT-A-CAR SYSTEM, INC.,
as a Grantor and Servicer
By:
---------------------------------
Name:
Title:
Address:
DOLLAR RENT A CAR SYSTEMS, INC.,
as a Grantor and Servicer
By:
---------------------------------
Name:
Title:
Address:
A-5
<PAGE> 50
EXHIBIT B
FINANCING SOURCE AND BENEFICIARY SUPPLEMENT TO
AMENDED AND RESTATED MASTER COLLATERAL AGENCY AGREEMENT
This FINANCING SOURCE AND BENEFICIARY SUPPLEMENT, dated as of _______,
19__ ("Supplement"), to the Master Collateral Agency Agreement, dated as of
December 13, 1995 (as heretofore amended, modified or supplemented, the
"Amended and Restated Master Collateral Agency Agreement"), among DOLLAR
THRIFTY AUTOMOTIVE GROUP, INC., a Delaware corporation ("DTAG"), as Master
Servicer (in such capacity, the "Master Servicer"), THRIFTY RENT-A-CAR SYSTEM,
INC., an Oklahoma corporation ("Thrifty"), as a servicer and as a grantor,
DOLLAR RENT A CAR SYSTEMS, INC., an Oklahoma corporation ("Dollar"), as a
Servicer and as a grantor, RENTAL CAR FINANCE CORP., an Oklahoma corporation
("RCFC"), as a grantor, RCFC and all other parties which have heretofore
executed a supplement thereto as a Financing Source (each, a "Financing Source"
and collectively, the "Financing Sources"), BANKERS TRUST COMPANY (in its
capacity as trustee under the Indenture (as defined in the Amended and Restated
Master Collateral Agency Agreement)), RCFC and all other parties which have
heretofore executed a supplement thereto as a Beneficiary (each, a
"Beneficiary" and collectively, the "Beneficiaries"), and BANKERS TRUST
COMPANY, not in its individual capacity but solely as master collateral agent
for the Beneficiaries (in such capacity, the "Master Collateral Agent"),
________ ("New Financing Source") and ______________ ("New Beneficiary").
WHEREAS, the Master Collateral Agent, the Servicers, the Lessee
Grantors, the Master Servicer, RCFC and other parties have entered into the
Amended and Restated Master Collateral Agency Agreement and now desire to add
an additional party to such Agreement.
NOW, THEREFORE, the parties agree as follows:
SECTION 1. Amended and Restated Master Collateral Agency Agreement.
Each of New Financing Source and New Beneficiary hereby acknowledges receipt of
an executed copy of the Amended and Restated Master Collateral Agency
Agreement. New Beneficiary hereby becomes (and is hereby designated by the
Servicer) a Beneficiary under the Amended and Restated Master Collateral Agency
Agreement. New Financing Source hereby becomes (and is hereby designated by
the Servicer) a Financing Source under the Amended and Restated Master
Collateral Agency Agreement. Each of New Financing Source and New Beneficiary
agrees to be bound by the terms thereof and hereby authorizes the Master
Collateral Agent to act on its behalf under the Amended and Restated Master
Collateral Agency Agreement with respect to its Related Vehicles and Related
Master Collateral.
SECTION 2. Notice Addresses. Any notice to be given to New Beneficiary
or New Financing Source shall be sent as set forth in the Amended and Restated
Master Collateral Agency
<PAGE> 51
Agreement to New Financing Source or New Beneficiary, as the case may be, at
the following address:
(New Financing Source)
------------------------
(New Beneficiary)
------------------------
SECTION 3. Counterparts. This Supplement may be executed in separate
counterparts and by the different parties on different counterparts, each of
which shall constitute an original and all of which when taken together shall
constitute one and the same agreement.
SECTION 4. GOVERNING LAW. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
IN WITNESS WHEREOF, each party hereto has executed this Supplement or
caused this Supplement to be duly executed by their respective officers duly
authorized as of the day and year first above written.
THRIFTY RENT-A-CAR SYSTEM, INC.,
individually and as Servicer
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
B-2
<PAGE> 52
DOLLAR RENT A CAR SYSTEMS, INC.,
as grantor and as servicer
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
RENTAL CAR FINANCE CORP.
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
DOLLAR THRIFTY AUTOMOTIVE
GROUP, INC.,
as Master Servicer
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
B-3
<PAGE> 53
BANKERS TRUST COMPANY,
not in its individual capacity but
solely as Master Collateral Agent
By:
---------------------------------
Name:
Title:
Address: 4 Albany Street
10th Floor
New York, New York 10006
(NEW FINANCING SOURCE)
By:
---------------------------------
Name:
Title:
Address:
(NEW BENEFICIARY)
By:
---------------------------------
Name:
Title:
Address:
B-4
<PAGE> 54
EXHIBIT C
MASTER SERVICER'S FLEET REPORT
Month ending __________, 19__
Pursuant to Section 2.4 of the Amended and Restated Master Collateral
Agency Agreement dated as of December 23, 1997, among Thrifty Rent-A-Car
System, Inc., as a grantor and as Servicer, Rental Car Finance Corp., as a
grantor, as Financing Source and as a Beneficiary, Dollar Rent A Car Systems,
Inc., as a grantor and as Servicer, Dollar Thrifty Automotive Group, Inc., as
Master Servicer, and Bankers Trust Company, not in its individual capacity but
solely as Master Collateral Agent, and the other parties thereto (as amended,
supplemented or otherwise modified from time to time, the "Amended and Restated
Master Collateral Agency Agreement"), the Servicer hereby certifies that
attached hereto is a report which shows for the month referred to above for
each Financing Source and each Related Vehicle designated thereto as of the
last day of each such month and after giving effect to the most recent
redesignation of Master Collateral Vehicle (i) the related Beneficiary in
respect thereof, (ii) whether such Related Vehicle is a Lessee Grantor Master
Collateral Vehicle or a RCFC Master Collateral Vehicle, (iii) the last eight
digits of the vehicle identification numbers with respect to such Related
Vehicle, and (iv) the Capitalized Cost and Net Book Value of such Related
Vehicle (calculated in accordance with the Financing Documents relating to the
applicable Financing Source). Capitalized terms used and not otherwise defined
herein have the meanings ascribed to such terms in the Amended and Restated
Master Collateral Agency Agreement.
Duly certified and executed, this __ day of __________, 19__.
Dollar Thrifty Automotive Group, Inc.,
as Master Servicer
By:
---------------------------------
Name:
Title:
<PAGE> 55
EXHIBIT D
CERTIFICATE OF TITLE LOCATIONS
Certificates of Title will be received by:
BANKERS TRUST COMPANY, as Master Collateral Agent
Address: 4 Albany Street
10th Floor
New York, New York 10006
and subsequently transferred to:
THRIFTY RENT-A-CAR SYSTEM, INC., as Servicer
5330 East 31st Street
Suite 100
Tulsa, Oklahoma 74135
or
DOLLAR RENT A CAR SYSTEMS, INC.
5330 East 31st Street
Suite 100
Tulsa, Oklahoma 74135
<PAGE> 56
EXHIBIT E
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENT, that Bankers Trust Company as Master
Collateral Agent (the "Master Collateral Agent") under that certain Amended and
Restated Master Collateral Agency Agreement dated as of December 23, 1997, (as
amended, supplemented or otherwise modified from time to time, the "Amended and
Restated Master Collateral Agency Agreement") among Dollar Rent A Car Systems,
Inc. ("Dollar") and Thrifty Rent-A-Car System, Inc. ("Thrifty"), each as a
grantor and Servicer, Rental Car Finance Corp., ("RCFC"), as a grantor, a
Financing Source and as a Beneficiary, Dollar Thrifty Automotive Group, Inc.
("DTAG"), as Master Servicer, various Financing Sources parties thereto,
various Beneficiaries parties thereto, and the Master Collateral Agent, does
hereby make, constitute and appoint ( ) its true
and lawful Attorney(s)-in-Fact for it and in its name, stead and behalf to
execute any and all documents and instruments, but only in connection with the
following: (i) to note the Master Collateral Agent as the holder of a first
Lien on the Certificate of Title, and/or otherwise ensure that the first Lien
shown on any and all Certificates of Title (other than any Certificates of
Title relating to an Existing Fleet) is in the name of the Master Collateral
Agent, (ii) to release the Master Collateral Agent's Lien on any Certificate of
Title in connection with the sale or disposition of any related Master
Collateral Vehicle permitted pursuant to the provisions of the Financing
Documents relating to such Master Collateral Vehicle, (iii) to release the
Master Collateral Agent's Lien on any Certificate of Title with respect to any
Master Collateral Vehicle which is not a Related Vehicle with respect to any
Beneficiary or with respect to which all obligations to the related Beneficiary
have been satisfied in full (and any applicable bankruptcy preference period
has expired) and (iv) to appoint individual representatives of (
) as attorneys-in-fact to act on behalf of ( ) to
fulfill the purposes of this Power of Attorney. Capitalized terms used herein
and not otherwise defined herein shall have the meanings ascribed to such terms
in the Amended and Restated Master Collateral Agency Agreement.
The powers and authority granted hereunder shall, unless sooner revoked
by the Master Collateral Agent in accordance with Section 2.7 of the Amended
and Restated Master Collateral Agency Agreement or following the resignation or
removal of the Master Collateral Agent under the Amended and Restated Master
Collateral Agency Agreement, cease upon the termination of the Amended and
Restated Master Collateral Agency Agreement.
<PAGE> 57
IN WITNESS WHEREOF, the undersigned has caused this instrument to be
executed on its behalf on this ___ day ________, 1997.
BANKERS TRUST COMPANY,
not in its individual
capacity, but solely as
Master Collateral Agent,
By:
----------------------
Name:
Title:
STATE OF NEW YORK )
:
COUNTY OF NEW YORK )
Subscribed and sworn before me, a notary public, in and for said county
and state, this ____ day of _________, 1997.
----------------------
Notary Public
My Commission Expires:
E-2
<PAGE> 58
EXHIBIT F
COLLATERAL ASSIGNMENT OF GUARANTEED DEPRECIATION PROGRAM
THIS COLLATERAL ASSIGNMENT OF GUARANTEED DEPRECIATION PROGRAM, dated as
of December 23, 1997 (this "Collateral Assignment") is made by THRIFTY RENT A
CAR SYSTEM, INC., an Oklahoma corporation ("Thrifty"), DOLLAR RENT A CAR
SYSTEMS, INC., a Delaware corporation ("Dollar") and RENTAL CAR FINANCE
CORP.("RCFC" and, together with Thrifty and Dollar, the "Assignors") in favor
of BANKERS TRUST COMPANY, a New York banking corporation, as master collateral
agent (the "Assignee") on behalf of the Beneficiaries (as defined in that
certain Amended and Restated Master Collateral Agency Agreement, dated as of
December 23, 1997 (the "Master Collateral Agency Agreement") among the
Assignee, in its capacity as master collateral agent, the Assignors, Dollar
Thrifty Automotive Group, Inc., ("DTAG") as Master Servicer, and certain
financing sources and Beneficiaries parties thereto), as so acknowledged,
consented to and agreed to by the Assignee and CHRYSLER CORPORATION, a Delaware
corporation (the "Manufacturer").
W I T N E S S E T H:
WHEREAS, the Assignors are each participants in the Guaranteed
Depreciation Program offered by the Manufacturer to the Assignors with respect
to the purchase of new 1997 and 1998 model year vehicles from the Manufacturer,
including all terms and conditions now or hereafter in effect thereunder and
all successor programs relating to future model year vehicles(the "Manufacturer
Programs");
WHEREAS, pursuant to the Master Collateral Agency Agreement, each
Assignor has pledged, assigned, conveyed, delivered, transferred and set over
to the Assignee, and granted to the Assignee a security interest in, all such
Assignor's right, title and interest in, to and under, among other collateral,
the Manufacturer Programs; and
WHEREAS, this Agreement is intended to transfer to the Assignee each
Assignor's interest in the Manufacturer Programs and to evidence the
Manufacturer's consent to such transfer.
NOW, THEREFORE, in consideration of the foregoing premises, and other
good and valuable consideration (the receipt and sufficiency of which are
hereby acknowledged), each Assignor and Assignee agree as follows:
1. Assignment. Each Assignor hereby irrevocably pledges, assigns,
conveys, delivers, transfers and sets over to the Assignee, and grants to the
Assignee a security interest in, all such Assignor's right, title and interest
in, to and under the Manufacturer Programs (whether now existing or hereafter
arising), to the extent that such right, title and interest relates to the
RCFC Master Collateral Vehicles, the Thrifty Master Collateral
<PAGE> 59
Vehicles or the Dollar Master Collateral Vehicles (in each case as defined in
the Master Collateral Agency Agreement) (the "Assigned Program Rights") and all
monies due and to become due with respect to the Assigned Program Rights
thereunder or in connection therewith, whether payable as guaranteed
depreciation payments, fees, expenses, costs, indemnities, insurance
recoveries, damages for breach of the Manufacturer Programs or otherwise
(exclusive of any payments payable as an advertising and promotional allowance
pursuant to and in accordance with the terms of the Manufacturer Programs).
2. Representations and Warranties. Each Assignor hereby represents
and warrants to the Assignee that (a) such Assignor's Assigned Program Rights
are not subject to any other pledge, assignment, encumbrance or hypothecation,
and no other security interest exists therein (other than with respect to
Dollar's existing fleet, the security interest held by Chrysler Credit
Corporation), and (b) the Manufacturer Programs for the 1997 and 1998 model
year vehicles are in full force and effect and there exists no default
thereunder.
3. Manufacturer's Consent. The Manufacturer hereby acknowledges and
consents to the assignment, pledge and grant of a security interest in the
Assigned Program Rights of each Assignor to the Assignee and hereby agrees to
recognize the Assignee as the holder of the interest of each Assignor in the
Assigned Program Rights from and after the date of this Agreement and hereby
acknowledges that the Assignee has the right to enforce the Assigned Program
Rights against the Manufacturer. Each Assignor irrevocably instructs the
Manufacturer to pay directly to the Assignee, to the account specified by the
Assignee, all amounts now or hereafter payable to such Assignor under the
Manufacturer Programs in respect of the Assigned Program Rights. Each Assignor
waives all claims against the Manufacturer and releases it from all liability
arising in connection with any such payments by the Manufacturer to the
Assignee.
4. Manufacturer Programs in Full Force and Effect. The Manufacturer
acknowledges and agrees that (i) the Manufacturer Programs for the 1997 and
1998 model year vehicles are in full force and effect, (ii) such Manufacturer
Programs have been duly authorized by the Manufacturer and constitute legal,
valid and binding obligations of the Manufacturer enforceable in accordance
with its terms, and (iii) each of the Assignors is a duly authorized fleet
purchaser under the Manufacturer Programs entitled to the benefits provided by
such Manufacturer Programs.
5. No Amendments. The Manufacturer agrees that it will not modify,
amend, alter or otherwise change the provisions of the Manufacturer Programs in
any way that would reduce the amount payable by the Manufacturer thereunder in
respect of the Assigned Program Rights assigned to Assignee under this
Agreement. The Manufacturer agrees that it will not otherwise reduce any
amount payable by it in respect of turned-back Vehicles purchased by the
Assignors under any Manufacturer Program for any reason other than charges
expressly contemplated in such Manufacturer Program.
F-2
<PAGE> 60
6. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which taken
together shall constitute one instrument.
7. Further Assurances. The parties hereby agree that, upon request
of any party, each of them will execute and deliver such further documents and
instruments as may reasonably be requested in order to carry out the purposes
of this Agreement.
8. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
9. Notices to Manufacturer. Any notice provided hereunder to the
Manufacturer shall be in writing and, if mailed, shall be deemed to be given
upon receipt thereof, and shall be sent by registered or certified mail,
postage prepaid, and addressed to the Manufacturer at its address set forth
below, or at such other address as the Manufacturer may, by written notice,
designate as its address for purposes of notice hereunder.
Chrysler Corporation
Fleet Operations
American Center - 19th Floor
17777 Franklin Road
Southfield, MI 48034
Attention: General Manager
with a copy to:
Chrysler Corporation
12000 Chrysler Drive
Highland Park, MI 48388-0001
Attention: Vice President, General
Counsel & Secretary
F-3
<PAGE> 61
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
duly executed and agreed to and accepted by their respective duly authorized
officers as of the day and year first above written.
DOLLAR RENT A CAR SYSTEMS, INC.,
as Assignor
By:
---------------------------------
Name:
Title:
THRIFTY RENT-A-CAR SYSTEM, INC.,
as Assignor
By:
---------------------------------
Name:
Title:
RENTAL CAR FINANCE CORPORATION
as Assignor
By:
---------------------------------
Name:
Title:
<PAGE> 62
Acknowledged, Consented to and
Agreed to:
ASSIGNEE:
BANKERS TRUST COMPANY,
as Assignee
By:___________________________
Name:
Title:
MANUFACTURER:
CHRYSLER CORPORATION
By:_____________________________
Name:
Title:
<PAGE> 63
EXHIBIT G
LIST OF NEW YORK, NEW YORK AND TULSA, OKLAHOMA BANK HOLIDAYS
(to be attached)
<PAGE> 64
EXHIBIT H
INVESTMENT STANDING INSTRUCTION
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
5330 East 31st Street
Tulsa, Oklahoma 74135
____________, 199 __
Bankers Trust Company
as Master Collateral Agent
4 Albany Street, 10th Floor
New York, New York 10065
Re: Permitted Investments
Ladies and Gentlemen:
Reference is made to the Amended and Restated Master Collateral
Agency Agreement (the "Amended and Restated Master Collateral Agency
Agreement"), dated as of December 23, 1997, among Dollar Rent A Car Systems,
Inc., as Servicer, Thrifty Rent-A-Car System, Inc., as Servicer, Rental Car
Finance Corp., as grantor, Dollar Thrifty Automotive Group as Master Servicer,
various Financing Sources parties thereto, various Beneficiaries parties
thereto, and the Master Collateral Agent. Capitalized terms used herein and
not otherwise defined shall have the meanings ascribed thereto in the Amended
and Restated Master Collateral Agency Agreement.
Pursuant to Section 2.5(f) of the Amended and Restated Master
Collateral Agency Agreement, you are hereby authorized and instructed to invest
funds from time to time on deposit in the Master Collateral Account (and not
otherwise distributable in accordance with the terms of the Amended and
Restated Master Collateral Agency Agreement) in the Permitted Investments
described in Schedule 1 hereto.
Dollar Thrifty Automotive Group, Inc.,
as Master Servicer under the Master
Collateral Agency Agreement
By
-----------------------------
Name:
Title:
<PAGE> 65
Schedule 1
Permitted Investments
(to be attached)
<PAGE> 1
EXHIBIT 4.11
EXECUTION COPY
================================================================================
CHRYSLER SUPPORT LETTER OF CREDIT
AND REIMBURSEMENT AGREEMENT
Dated as of December 23, 1997
among
CHRYSLER CORPORATION,
DOLLAR RENT A CAR SYSTEMS, INC.,
as a Lessee,
THRIFTY RENT-A-CAR SYSTEM, INC.,
as a Lessee,
and
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.,
TRAC TEAM, INC.,
DTAG SERVICES, INC.
as Guarantors.
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
ARTICLE I
DEFINITIONS
<S> <C>
Section 1.1. Definitions................................................................................4
ARTICLE II
ISSUANCE OF CHRYSLER SUPPORT
LETTERS OF CREDIT; REIMBURSEMENT OBLIGATION
Section 2.1. Issuance of Chrysler Letters of Credit; Reduction Amounts..................................4
Section 2.2. Fees.......................................................................................8
Section 2.3. Reimbursement..............................................................................8
Section 2.4. No Liability of Chrysler...................................................................9
Section 2.5. Conditions Precedent to Issuance...........................................................9
Section 2.6. Obligation Absolute.......................................................................11
Section 2.7. Guaranty..................................................................................12
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 3.1. Representations and Warranties of the Lessees and DTAG....................................15
Section 3.2. Covenants of the Lessees and DTAG.........................................................16
Section 3.3. Injunctive Relief with Respect to Certain Covenants.......................................19
Section 3.4. Chrysler Covenants........................................................................19
ARTICLE IV
MISCELLANEOUS
Section 4.1. Payments..................................................................................20
Section 4.2. Notices...................................................................................20
Section 4.3. Amendments, etc...........................................................................21
</TABLE>
i
<PAGE> 3
<TABLE>
<S> <C>
Section 4.4. Consent to Jurisdiction...................................................................21
Section 4.5. Waiver of Jury Trial......................................................................22
Section 4.6. Governing Law.............................................................................22
Section 4.7. Severability..............................................................................22
Section 4.8. Term......................................................................................22
Section 4.9. Successors and Assigns....................................................................23
Section 4.10. Counterparts.............................................................................23
Section 4.11. Further Assurances.......................................................................23
Section 4.12. Survival of Obligations..................................................................23
Section 4.13. Obligation...............................................................................23
Section 4.14. Headings.................................................................................24
Section 4.15. Application of Funds.....................................................................24
Section 4.16. Subordination of Obligations Pursuant to Group I Collateral Sharing
Agreement.............................................................................24
Section 4.17. Additional Lessees.......................................................................24
Section 4.18. Additional Guarantors....................................................................24
Section 4.19. Indemnification..........................................................................24
</TABLE>
Exhibit A - Form of Series 1997-1 Chrysler Support Letter of Credit
ii
<PAGE> 4
CHRYSLER SUPPORT LETTER OF CREDIT
AND REIMBURSEMENT AGREEMENT
THIS CHRYSLER SUPPORT LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT, dated
as of December 23, 1997 (as the same may be amended, supplemented, restated or
otherwise modified from time to time in accordance with the terms hereof, this
"Agreement"), is entered into by and among CHRYSLER CORPORATION, a Delaware
corporation ("Chrysler"), DOLLAR RENT A CAR SYSTEMS, INC., an Oklahoma
corporation ("Dollar"), THRIFTY RENT-A-CAR SYSTEM, INC., an Oklahoma corporation
("Thrifty"), each of Dollar and Thrifty a "Lessee" and, collectively, the
"Lessees"), and DOLLAR THRIFTY AUTOMOTIVE GROUP, INC., a Delaware corporation
("DTAG"), TRAC TEAM, INC., an Oklahoma corporation ("TRAC"), and DTAG SERVICES,
INC., an Oklahoma corporation ("Services"); DTAG, TRAC and Services, each a
"Guarantor").
R E C I T A L S
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, Rental Car Finance Corp., a special purpose Oklahoma corporation,
formerly known as Thrifty Car Rental Finance Corporation ("RCFC"), as issuer (in
such capacity, the "Issuer"), and Bankers Trust Company, a New York banking
corporation, as Trustee (in such capacity, the "Trustee"), are entering into the
Series 1997-1 Supplement, dated as of even date herewith (as the same may be
amended, supplemented, restated or otherwise modified from time to time in
accordance with the terms thereof, the "Series 1997-1 Supplement"), to the Base
Indenture, dated as of December 13, 1995, between RCFC and the Trustee, as
amended, supplemented, restated or otherwise modified from time to time in
accordance with the terms thereof, the "Base Indenture"), pursuant to which RCFC
will issue its Series 1997-1 Notes (such capitalized term, together with all
other capitalized terms used and not defined herein, shall have the meanings
assigned thereto pursuant to Section 1.1);
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, RCFC, the Lessees and DTAG are entering into the Master Motor Vehicle
Lease and Servicing Agreement dated as of even date herewith (the "Master
Lease"), pursuant to which RCFC will lease vehicles to Lessees in their
respective domestic daily rental business;
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, DTAG, the Issuer, the Trustee, Thrifty, Dollar, certain other parties
thereto, and
<PAGE> 5
Bankers Trust Company, as Master Collateral Agent, are entering into an Amended
and Restated Master Collateral Agency Agreement (the "Master Collateral Agency
Agreement"), which amends and restates the Master Collateral Agency Agreement,
dated as of December 13, 1995, among the Issuer, Thrifty, certain other parties
thereto, and the Master Collateral Agent;
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the Series 1997-1 Letter of Credit Provider is issuing its Series
1997-1 Letter of Credit to the Trustee to provide (i) with respect to the
Lessees, partial credit support for the obligations of the Lessees to make
payments under the Master Lease and (ii) with respect to DTAG, credit support
for any amounts owed by DTAG under Section 4.19 of the Series 1997-1 Supplement;
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, Chrysler is executing and delivering to the Series 1997-1 Letter of
Credit Provider a letter of credit (such letter of credit, as the same may be
amended, supplemented, restated or otherwise modified from time to time in
accordance with the terms thereof and any successor letter of credit thereto as
provided for in this Agreement and thereunder, the "Chrysler Series 1997-1
Support Letter of Credit") in substantially the form of Exhibit A hereto, to
reimburse the Series 1997-1 Letter of Credit Provider for any amounts drawn
under the Series 1997-1 Letter of Credit subject to the terms and conditions set
forth therein in an amount up to the Available Chrysler Support Amount (as such
term is defined in Chrysler Series 1997-1 Support Letter of Credit) and on the
terms set forth in the Chrysler Series 1997-1 Support Letter of Credit;
WHEREAS, substantially contemporaneously with the execution and delivery of
this Agreement, (a) DTAG intends to issue shares of its common stock, par value
$0.01 per share (the "Common Stock"), in a registered public offering for net
cash proceeds of at least $45,000,000, which proceeds will be used to provide
collateral for the financing of vehicles by DTAG and its subsidiaries (the
"Primary Equity Offering"), and (b) Chrysler intends to sell approximately
20,000,000 shares of the Common stock of DTAG owned by it in a registered public
offering which, following the consummation thereof, will result in DTAG no
longer being a subsidiary of Chrysler (the "Second Equity Offering" and,
together with the Primary Equity Offering, the "Equity Offerings");
WHEREAS, it is contemplated that following the execution and delivery of
this Agreement, (a) DTAG will implement through a to-be-formed special purpose,
wholly-owned subsidiary ("Dollar Thrifty Funding"), a commercial paper program
of up to $615,000,000 secured by vehicles and related assets, the proceeds of
which will be used to finance vehicle fleet growth and to refinance existing
vehicle fleet indebtedness (the
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<PAGE> 6
"CP Program"), and (b) in connection with the CP Program, a letter of credit
would be provided (the "CP Program Letter of Credit") by a financial institution
having a short-term credit rating of "A-1" (or better) from S&P and "P-1" from
Moody's (the "CP Program Letter of Credit Provider");
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the Lessees, DTAG Chrysler and the Series 1997-1 Letter of Credit
Provider are entering into the Series 1997-1 Letter of Credit Agreement, dated
as of even date herewith (as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof, the "Series
1997-1 Letter of Credit Agreement"), to provide for the issuance of the Series
1997-1 Letter of Credit and for Chrysler, the Lessees or DTAG to provide
additional collateral or replacement letters of credit to replace, or reduce the
amount of, the Chrysler Series 1997-1 Support Letter of Credit from time to time
and for the payment and repayment of certain fees and expenses and other
obligations of Chrysler, the Lessees and DTAG to the Series 1997-1 Letter of
Credit Provider in connection with the execution and delivery by the Series
1997-1 Letter of Credit Provider of the Series 1997-1 Letter of Credit;
WHEREAS, pursuant to the Series 1997-1 Letter of Credit Agreement
additional institutions (each, an "Additional Series 1997-1 Support Letter of
Credit Provider") may be issuing to the Series 1997-1 Letter of Credit Provider
a letter of credit (each such letter of credit, a "Series 1997-1 Support Letter
of Credit") to reimburse the Series 1997-1 Letter of Credit Provider for any
amounts drawn under the Series 1997-1 Letter of Credit on a pro rata basis with
respect to each other and with respect to Chrysler's reimbursement of such
amounts pursuant to Chrysler Series 1997-1 Support Letter of Credit;
WHEREAS, the Lessees, DTAG and Chrysler are entering into this Agreement to
provide for, among other things, (i) the reimbursement by the Lessees (or in
certain cases, DTAG) of draws upon the Chrysler Series 1997-1 Support Letter of
Credit that are made by the Series 1997-1 Letter of Credit Provider and (ii) the
guaranty by DTAG of the reimbursement obligations of each of the Lessees.
NOW, THEREFORE, in consideration of the recitals and of the agreements
herein contained, and for due and adequate consideration, which the parties
hereto hereby acknowledge, the parties hereto agree as follows:
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions. As used in this Agreement and unless the context
requires a different meaning, capitalized terms used but not defined herein
(including in the preamble and the recitals hereto) shall have the meanings
assigned to such terms in (i) the Series 1997-1 Supplement, as amended,
supplemented, restated or otherwise modified from time to time in accordance
with the terms of the Series 1997-1 Supplement, (ii) the Definitions List
attached as Schedule 1 to the Base Indenture, as in effect on the date hereof,
as such Definitions List may be further amended, supplemented, restated or other
wise modified from time to time in accordance with the terms of the Base
Indenture, provided that to the extent, if any, that any capitalized term used
but not defined herein has a meaning assigned in both the Series 1997-1
Supplement and the Definitions List to the Base Indenture, then the meaning
assigned to such term in the Series 1997-1 Supplement shall apply herein, (iii)
the Revolving Credit Agreement, dated as of December 23, 1997 (the "Revolving
Credit Agreement"), among DTAG, Dollar, Thrifty, various financial
institutions, Credit Suisse First Boston, as Administrative Agent, and The Chase
Manhattan Bank, as Syndication Agent, as in effect on the date hereof, and (iv)
the form of Chrysler Support Letter of Credit attached as Exhibit A hereto. The
term "Material Adverse Effect" shall be used as defined in the Series 1997-1
Supplement and shall also mean a material adverse effect on the business,
property, operations, assets, liabilities, condition (financial or otherwise) or
prospects of DTAG and its subsidiaries taken as a whole and the term "Permitted
Liens" shall mean Liens permitted by the Revolving Credit Agreement.
ARTICLE II
ISSUANCE OF CHRYSLER SUPPORT
LETTERS OF CREDIT; REIMBURSEMENT OBLIGATION
Section 2.1. Issuance of Chrysler Letters of Credit; Reduction Amounts. (a)
Chrysler hereby agrees, on the terms and subject to the conditions hereinafter
set forth, to execute and deliver (i) to the Series 1997-1 Letter of Credit
Provider the Chrysler Series 1997-1 Support Letter of Credit in an initial
amount not exceeding $50,000,000 (such amount less the reductions (if any)
required by this Section 2.1(a), the "Initial Chrysler Support Amount") for a
term expiring on December 23, 2002 (the "Chrysler Support Expiration Date") and
(ii) in the event the Initial Chrysler Support Amount is greater than the stated
amount of the Chrysler Series 1997-1 Support Letter of
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<PAGE> 8
Credit or that the CP Program continues beyond December 23, 2002 (such excess,
the "Remaining Amount"), to the CP Program Letter of Credit Provider a letter of
credit in form and substance substantially similar to the Chrysler Series 1997-1
Support Letter of Credit (the "CP Program Support Letter of Credit" and,
together with the Chrysler Series 1997-1 Support Letter of Credit, the "Chrysler
Support Letters of Credit") (except that such letter of credit shall also
provide for reimbursement of the CP Program Letter of Credit Provider for
"liquidity drawings" made upon the CP Program Letter of Credit Provider) in a
stated amount equal to the Remaining Amount, which letter of credit shall be
reasonably acceptable to the CP Program Letter of Credit Provider. In the event
the letter of credit described in the preceding clause (ii) is to be delivered
to the CP Program Letter of Credit Provider by Chrysler, the parties hereto
agree to use their best efforts to negotiate a supplement to this Agreement that
would contain terms and conditions governing such letter of credit that are in
form and substance substantially similar to the terms and conditions set forth
herein governing the Chrysler Series 1997-1 Support Letter of Credit (except
that such supplement shall contain terms providing for reimbursement of
"liquidity" draws by Dollar Thrifty Funding over a period of up to 18 months,
the selection of interest periods and rates with respect to such drawings, the
apportionment of termination draws between "liquidity" draws and "credit" draws,
and the ability of the trustee with respect to the CP Program (or its agent) to
convert "liquidity" drawings to "credit" drawings all of which terms shall be
substantially similar to those governing any Enhancement Letter of Credit),
which supplement shall be reasonably acceptable to the CP Program Letter of
Credit Provider and the parties hereto. In the event the net cash proceeds
received by DTAG pursuant to the exercise by the underwriters and managers of
the Equity Offerings of their options (the "Over-Allotment Options") pursuant to
Section 3 of the Underwriting Agreement, dated December 16, 1997, among DTAG,
Chrysler, Credit Suisse First Boston Corp., Goldman, Sachs & Co., J.P. Morgan
Securities Inc. and Smith Barney, Inc. to purchase additional shares of Common
Stock to cover over-allotments exceeds $10,000,000, the commitment of Chrysler
hereunder to provide a letter of credit or letters of credit in an aggregate
stated amount of $50,000,000 (the "Chrysler Support Commitment") shall be
reduced, on the Closing Date (with respect to Over-Allotment Options exercised
on or prior to the Closing Date) or (with respect to Over-Allotment Options
exercised after the Closing Date), not later than 10 business days after the
earlier of (i) the exercise of all of the remaining Over-Allotment Options and
receipt by DTAG of the proceeds thereof and (ii) the expiration date of the
Over-Allotment Options (the earlier of (i) and (ii) being hereinafter referred
to as the "Determination Date"), by the amount by which such proceeds (less any
underwriters discount) exceeds $10,000,000 and, in the event the stated amount
of the Chrysler Series 1997-1 Support Letter of Credit exceeds such reduced
commitment, Dollar and Thrifty shall cause such letter of credit to be reduced
to the amount of such reduced commitment by causing a reduction in the Series
1997-1
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<PAGE> 9
Letter of Credit, or by providing the Series 1997-1 Letter of Credit Provider
with additional collateral or an Additional Series 1997-1 Support Letter of
Credit, all as provided in the Series 1997-1 Letter of Credit Agreement. Not
later than five Business Days after the Determination Date, DTAG shall deliver
to Chrysler a certificate executed by its chief financial officer certifying to
Chrysler the amount of any such over-allotment proceeds and related
underwriters' discount. The parties hereto confirm that on the Closing Date;
DTAG received $21,791,250 in net cash proceeds from the exercise of the
Over-Allotment Options and that a Chrysler Series 1997-1 Support Letter of
Credit in the amount of $38,208,750 was issued on the Closing Date.
(b) If a successor Series 1997-1 Letter of Credit Provider is appointed,
promptly following the appointment of such successor Series 1997-1 Letter of
Credit Provider, and upon receipt of an Instruction to Transfer substantially in
the form of Annex G to the Chrysler Series 1997-1 Support Letter of Credit,
Chrysler shall deliver for the benefit of such successor and the current Series
1997-1 Letter of Credit Provider, in exchange for its outstanding Chrysler
Series 1997-1 Support Letter of Credit, a substitute letter of credit
substantially in the form of Exhibit A hereto having terms substantially
identical to its then outstanding Chrysler Series 1997-1 Support Letter of
Credit, but in favor of such successor.
(c) (i) On September 30, 1999, and on each successive one year anniversary
thereof until the Chrysler Support Expiration Date (each, a "Reduction Date"),
the Chrysler Support Commitment shall be reduced by an amount equal to the
greater of (A) 20% of the Initial Chrysler Support Amount and (B) 50% of Excess
Cash Flow (as defined below) for the fiscal year of DTAG most recently ended
prior to the relevant Reduction Date (respectively, the "Support Reduction
Amount"). On or before the date that is 60 days prior to each Reduction Date,
DTAG shall deliver to Chrysler a certificate executed by its chief financial
officer certifying the Support Reduction Amount with respect to such Reduction
Date, which certificate shall include a reasonably detailed calculation of
Excess Cash Flow for the relevant fiscal year. "Excess Cash Flow" means for the
relevant period, an amount equal to the excess of (a) the sum, without
duplication, of (i) consolidated net income (loss) of DTAG and its subsidiaries
for such period, (ii) decreases in Working Capital for such period and (iii) an
amount equal to the amount of all non-cash charges deducted in arriving at such
consolidated net income (loss) (excluding book depreciation on revenue earning
vehicles and net losses on disposition of revenue earning vehicles) over (b) the
sum, without duplication, of (i) the amount of all non-cash credits included in
arriving at such consolidated net income (loss) (excluding net gains on
disposition of revenue earning vehicles), (ii) the aggregate amount of capital
expenditures for the period (other than those related to acquisitions of revenue
earning vehicles) of DTAG and its subsidiaries (excluding the principal amount
of indebtedness
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<PAGE> 10
incurred in connection with such capital expenditures, whether incurred in such
period or in another period), (iii) the aggregate amount of all mandatory
prepayments required under any indebtedness to which DTAG or any of its
subsidiaries is a party, (iv) the aggregate amount of all scheduled principal
payments of indebtedness of DTAG or its subsidiaries, (including any term loans
and the principal component of payments in respect of capitalized lease
liabilities) made during such period and (v) increases in Working Capital for
such period. "Working Capital" means, with respect to the Parent, at any date,
the excess (or the deficit) of (a) the sum of the amounts that, in accordance
with GAAP, are set forth opposite the captions "accounts and notes receivable,
net" (excluding accounts receivable from Chrysler related to the MCAIC insurance
settlement and accounts receivables pledged to the Master Collateral Agent under
Sections 2.1(a)(iii) and 2.1(b)(iii) of the Master Collateral Agency Agreement),
"prepaid expenses and other assets", "income taxes receivable," and "deferred
income tax assets" or any like captions at such date over (b) the sum of the
amounts that, in accordance with GAAP, are set forth opposite the captions
"accounts payable (excluding outstanding checks included in accounts payable
related to vehicle financing ("float"))", "accrued liabilities", "income taxes
payable", "public liability and property damage" and "deferred income tax
liabilities", or any like captions, including any accruals for restructuring or
similar type reserves, at such date. The Company agrees that activities
affecting such account balances will be performed in the normal course in a
manner that is both usual and customary for management of such accounts and is
consistent with past practices. All accounting terms used in this definition
shall be interpreted, and all accounting determinations and computations set
forth in this definition shall be made, in accordance with, those generally
accepted accounting principles applied in the preparation of the audited
financial statements of DTAG and its subsidiaries as of December 31, 1996. At
Chrysler's request, DTAG shall cause its auditors to confirm the calculation of
Excess Cash Flow in a manner satisfactory to Chrysler.
(ii) On or before the date that is 15 days prior to each Reduction
Date, pursuant to the terms of the Series 1997-1 Letter of Credit Agreement, the
Lessees shall deliver credit support to the Series 1997-1 Letter of Credit
Provider that will satisfy the requirements for a Series 1997-1 Credit Support
Arrangement under the Series 1997-1 Letter of Credit Agreement (such other
credit support, "Reduction Amount Credit Support"), in each case in an amount
equal to the Support Reduction Amount for the related Reduction Date. Upon
notification to Chrysler by the Series 1997-1 Letter of Credit Provider that it
has received the Reduction Amount Credit Support and that Chrysler's obligations
under the Series 1997-1 Chrysler Support Letter of Credit will be reduced by the
relevant Support Reduction Amount, the fees payable under Section 2.2 will be
adjusted accordingly.
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<PAGE> 11
Section 2.2. Fees. (a) Lessees shall pay a usage fee to Chrysler for the
period from the date of issuance of any Chrysler Support Letter of Credit to
(but not including) the date upon which it terminates or expires, calculated at
a rate per annum equal to the then Applicable Margin under the Revolving Credit
Agreement with respect to Eurodollar Loans of the stated amount of any such
Chrysler Support Letter of Credit.
(b) Lessees shall pay to Chrysler a commitment fee calculated at a rate per
annum equal to the then Applicable Commitment Fee under the Revolving Credit
Agreement of the excess, if any, of the available amount of the Chrysler Support
Commitment over the stated amount of all outstanding Chrysler Support Letters of
Credit.
(c) The fees set forth in Section 2.2(a) and (b) shall be increased by 200
basis points during any period in which the Lessees have failed to provide the
Series 1997-1 Letter of Credit Provider with any additional collateral or
Additional Series 1997-1 Support Letter of Credit when required by Section
2.1(a) or any Reduction Amount Credit Support when required by Section
2.1(c)(ii).
(d) All fees shall be payable to Chrysler quarterly in arrears on the last
business day of each calendar quarter.
Section 2.3. Reimbursement. Each Lessee agrees to pay to Chrysler on demand
(which demand may be made upon DTAG) with respect to any Support Credit
Disbursement, any Support Termination Disbursement or any Support Reduction
Disbursement, or any withdrawal from the Chrysler Support Cash Collateral
Account relating to a Series 1997-1 LOC Credit Disbursement, a Series 1997-1 LOC
Termination Disbursement or a reduction in the Chrysler Support Commitment, in
each case, on the date thereof (provided, that with respect to any Support
Credit Disbursement that is with respect to a Series 1997-1 LOC Credit
Disbursement for amounts owed by DTAG under Section 4.19 of the Series 1997-1
Supplement, such agreement is made solely by DTAG), (i) (A) with respect to any
Support Credit Disbursement (including any withdrawal from the Chrysler Support
Cash Collateral Account relating to a Series 1997-1 LOC Credit Disbursement), an
amount equal to the portion of such Support Credit Disbursement allocable to
amounts due and payable by such Lessee under the Master Lease as determined by
the Trustee or, in the event such Support Credit Disbursement is in respect of
amounts owed by DTAG under Section 4.19 of the Series 1997-1 Supplement, an
amount equal to such amount owed by DTAG, and (B) with respect to any Support
Termination Disbursement or Support Reduction Disbursement (including any
withdrawal from the Chrysler Support Cash Collateral Account relating to a
Series 1997-1 LOC Termination Disbursement or a reduction in the Chrysler
Support
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<PAGE> 12
Commitment), jointly and severally, the full amount thereof, plus (ii) interest
on any amount remaining unpaid by such Lessee or otherwise, as the case may be,
to Chrysler under clause (i) above, from (and including) the date of such
Support Credit Disbursement, Support Termination Disbursement, Support Reduction
Disbursement or withdrawal, as the case may be, until payment in full thereof
(after as well as before judgment), at a rate equal to the Base Rate (as defined
below) from time to time in effect plus 200 basis points, such interest to
payable on demand (which demand may be made upon DTAG with respect to any
Lessee) or, if prior to such demand, on the third (3rd) Business Day of each
calendar quarter. Interest accruing based on the Base Rate shall be computed on
the basis of the actual number of days elapsed and a 365 (or, if applicable,
366) day year. "Base Rate" means, on any date, a fluctuating rate of interest
per annum equal to the rate of interest published in the "Wall Street Journal"
on such date as the prime rate for U.S. Dollar loans by major money center
banks.
Section 2.4. No Liability of Chrysler. The Lessees and DTAG each
acknowledge that Chrysler is not responsible for any risks of acts or omissions
of the Series 1997-1 Letter of Credit Provider or any other beneficiary or
transferee of the Chrysler Series 1997-1 Support Letter of Credit with respect
to its use of the Chrysler Series 1997-1 Support Letter of Credit. In
furtherance and not in limitation of the foregoing, Chrysler may accept
documents that appear on their face, to be in order, without responsibility for
further investigation.
Section 2.5. Conditions Precedent to Issuance. (a) The following constitute
conditions precedent to the obligation of Chrysler to execute and deliver to the
Series 1997-1 Letter of Credit Provider the Chrysler Series 1997-1 Support
Letter of Credit (provided, that such conditions will be deemed to be satisfied
upon the execution and delivery of the Chrysler Series 1997-1 Support Letter of
Credit):
(i) On the date of the execution and delivery of the Chrysler Series
1997-1 Support Letter of Credit, all representations and warranties of the
Lessees and DTAG contained in this Agreement, the Revolving Credit Agreement and
in each other Related Document to which the Lessees or DTAG are a party (other
than representations and warranties relating to Chrysler) shall be true and
correct.
(ii) Chrysler shall have received from each of the Lessees and DTAG
(i) a copy of the resolutions of its Board of Directors or other governing body,
certified as of the Series 1997-1 Closing Date by the secretary or assistant
secretary thereof, authorizing the execution, delivery and performance of this
Agreement (if applicable), the Loan Documents and the other Related Documents to
which it is a party and (ii) an
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incumbency certificate thereof with respect to its officers, agents or other
representatives authorized to execute this Agreement (if applicable).
(iii) On the date of the execution and delivery of the Chrysler Series
1997-1 Support Letter of Credit, there shall be no action, suit, investigation,
litigation or proceeding pending against or, to the knowledge of the Lessees or
DTAG, threatened against any of the Lessees or DTAG before any court or
arbitrator or any Governmental Authority which in any manner draws into question
the legality, validity or enforceability of this Agreement or any other Related
Document, or the ability of any Lessee or DTAG to comply with any of the
respective terms thereunder except to the extent that any such condition is
reasonably unlikely to have a Material Adverse Effect.
(iv) All consents and approvals necessary in connection with this
Agreement or the transactions contemplated hereby or thereby shall have been
obtained and shall remain in effect except to the extent that the failure to do
so is not reasonably likely to have a Material Adverse Effect.
(v) On the date of the execution and delivery of the Chrysler Series
1997-1 Support Letter of Credit, there shall be no Event of Default under the
Revolving Credit Agreement (as defined therein).
(vi) Chrysler shall have received an opinion, dated the date hereof,
from counsel for DTAG and the Lessees, addressing the due authorization,
execution and delivery of this Agreement and the enforceability thereof against
DTAG and the Lessees.
(vii) The execution and delivery of documents (the "Chrysler Credit
Support Security Documents") in a form reasonably satisfactory to Chrysler which
shall give Chrysler (a) a first-priority perfected lien on any "retained
interest" of DTAG and its Subsidiaries in RCFC, which lien shall be pari passu
with the lien of the Lenders thereon, (b) a "silent" subordinated perfected lien
in all other assets of DTAG, the Lessees and their respective subsidiaries in
which the Lenders have a senior perfected lien, and (c) a subordinated perfected
lien in the assets pledged as security in respect of the MTN Program, which lien
shall be pari passu with the lien of the Lenders thereon.
(b) The following constitute conditions precedent to the obligation of
Chrysler to execute and deliver to the CP Program Letter of Credit Provider the
Chrysler CP Program Support Letter of Credit (provided, that such conditions
will be deemed to be satisfied upon the execution and delivery of the Chrysler
CP Program Support Letter of Credit):
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(i) execution by all parties hereto of a supplement to this agreement
as set forth in Section 2.1(a) hereto;
(ii) 15 days notice from the CP Program Letter of Credit Provider to
Chrysler, including the amount and terms of the requested Chrysler CP Program
Support Letter of Credit;
(iii) such conditions set forth in paragraph (a) of this Section as
made applicable mutatis mutandis to the Chrysler CP Program Support Letter of
Credit;
(iv) the execution and delivery of such other opinions and documents
as may reasonably be requested by Chrysler; and
(v) a subordinated perfected lien on assets owned by Lessees and
pledged as security in respect of CP Program, which lien shall be pari passu
with the lien of the Lenders thereon.
Section 2.6. Obligation Absolute. The payment obligations of each
Lessee and DTAG under this Agreement and any other agreement or instrument
relating to the Chrysler Support Letters of Credit shall be absolute,
unconditional and irrevocable, and shall be paid strictly in accordance with the
terms of this Agreement and such other agreement or instrument notwithstanding
any of the following:
(a) any lack of validity or enforceability of this Agreement, any
Chrysler Support Letters of Credit or any other Related Document;
(b) any change in the time, manner or place of payment of, or in
any other terms of, all or any of the obligations of any Lessee or
DTAG in respect of any Chrysler Support Letters of Credit or any other
amendment or waiver of, or any consent to departure from, all or any
of the Related Documents;
(c) the existence of any claim, set-off, defense or other right
which any Lessee may have at any time against the Trustee, the Series
1997-1 Letter of Credit Provider or any other beneficiary or any
transferee of a Chrysler Support Letter of Credit (or any persons or
entities for whom the Trustee, the Series 1997-1 Letter of Credit
Provider, any such beneficiary or any such transferee may be acting)
or any other person or entity (other than Chrysler or any affiliate of
Chrysler), whether in connection with this Agreement, the transactions
contemplated hereby or by the Related Documents or any unrelated
transaction;
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(d) any statement or any other document presented under a
Chrysler Sup port Letter of Credit proving to be forged, fraudulent or
invalid in any respect or any statement therein being untrue or
inaccurate in any respect;
(e) any statement or any other document presented under a
Chrysler Sup port Letter of Credit proving to be insufficient in any
respect;
(f) payment by Chrysler under a Chrysler Support Letter of Credit
against presentation of a draft or certificate which does not comply
with the terms of a Chrysler Support Letter of Credit; or
(g) any exchange, release or non-perfection of any collateral, or
any release or amendment or waiver of or consent to departure from any
guarantee, for all or any of the obligations of a Lessee or DTAG in
respect of a Chrysler Support Letter of Credit.
Section 2.7. Guaranty.
(a) Guaranty. In order to induce Chrysler to execute and deliver this
Agreement and to issue the Chrysler Support Letters of Credit, and in
consideration thereof, each of DTAG, TRAC and Services (each, a "Guarantor"),
hereby (i) unconditionally and irrevocably, jointly and severally, guarantees to
Chrysler the obligations of the Lessees to make any payments required to be made
by them under this Agreement, (ii) agrees to cause the Lessees to duly and
punctually perform and observe all of the terms, conditions, covenants,
agreements and indemnities of the Lessees under this Agreement, and (iii) agrees
that, if for any reason whatsoever, any Lessee fails to so perform and observe
such terms, conditions, covenants, agreements and indemnities, the Guarantor
will duly and punctually perform and observe the same (the obligations referred
to in clauses (i) through (iii) above are collectively referred to as the
"Guaranteed Obligations"). The liabilities and obligations of the Guarantor
under the guaranty contained in this Section 2.7 (this "Guaranty") will be
absolute and unconditional under all circumstances. This Guaranty shall be a
guaranty of payment and not of collection, and the Guarantor hereby agrees that
it shall not be required that Chrysler, the Series 1997-1 Letter of Credit
Provider or the Trustee assert or enforce any rights against any Lessee or any
other person before or as a condition to the obligations of the Guarantor
pursuant to this Guaranty.
(b) Scope of Guarantor's Liability. Each Guarantor's obligations
hereunder are independent of the obligations of the Lessees, any other guarantor
or any other Person, and Chrysler may enforce any of its rights hereunder
independently of any other right or
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<PAGE> 16
remedy that Chrysler may at any time hold with respect to this Agreement or any
security or other guaranty therefor. Without limiting the generality of the
foregoing, Chrysler may bring a separate action against each Guarantor without
first proceeding against any of the Lessees, any other guarantor or any other
Person, or any security held by Chrysler, and regardless of whether the Lessees
or any other guarantor or any other Person is joined in any such action. Each
Guarantor's liability hereunder shall at all times remain effective with respect
to the full amount due from the Lessees hereunder. Chrysler's rights hereunder
shall not be exhausted by any action taken by Chrysler until all Guaranteed
Obligations have been fully paid and performed.
(c) Right to Amend this Agreement. Each Guarantor authorizes Chrysler
at any time and from time to time without notice and without affecting the
liability of such Guarantor hereunder, to: (a) alter the terms of all or any
part of the Guaranteed Obligations and any security and guaranties therefor
including without limitation modification of times for payment and rates of
interest; (b) accept new or additional instruments, documents, agreements,
security or guaranties in connection with all or any part of the Guaranteed
Obligations; (c) accept partial payments on the Guaranteed Obligations; (d)
waive, release, reconvey, terminate, abandon, subordinate, exchange, substitute,
transfer, compound, compromise, liquidate and enforce all or any part of the
Guaranteed Obligations and any security or guaranties therefor, and apply any
such security and direct the order or manner of sale thereof (and bid and
purchase at any such sale), subject to the terms of the Intercreditor Agreement
dated December 23, 1997, between, DTAG, Dollar, Thrifty, Chrysler and Credit
Suisse First Boston, as administrative agent and collateral agent; (e) release
any Lessee, any guarantor or any other Person from any personal liability with
respect to all or any part of the Guaranteed Obligations; and (f) assign its
rights under this Guaranty in whole or in part.
(d) Waiver of Certain Rights by Guarantors. Each Guarantor hereby
waives each of the following to the fullest extent allowed by law:
(i) any defense based upon:
(A) the unenforceability or invalidity of any security or
other guaranty for the Guaranteed Obligations or the
lack of perfection or failure of priority of any
security for the Guaranteed Obligations; or
(B) any act or omission of Chrysler or any other Person
that directly or indirectly results in the discharge
or release of any of the Lessees or any other Person
or any of the Guaranteed Obligations or any security
therefor; or
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<PAGE> 17
(C) any disability or any other defense of any Lessee or
any other Person with respect to the Guaranteed
Obligations, whether consensual or arising by
operation of law or any bankruptcy, insolvency or
debtor-relief proceeding, or from any other cause;
(ii) any right (whether now or hereafter existing) to require
Chrysler, as a condition to the enforcement of this Guaranty, to:
(A) accelerate the Guaranteed Obligations;
(B) give notice to each Guarantor of the terms, time and
place of any public or private sale of any security
for the Guaranteed Obligations; or
(C) proceed against any Lessee, any other guarantor or
any other Person, or proceed against or exhaust any
security for the Guaranteed Obligations;
(iii) presentment, demand, protest and notice of any kind,
including without limitation notices of default and notice of
acceptance of this Guaranty;
(iv) all suretyship defenses and rights of every nature
otherwise available under New York law and the laws of any other
jurisdiction; and
(v) all other rights and defenses the assertion or exercise of
which would in any way diminish the liability of each Guarantor
hereunder.
(e) Guarantors to Pay Chrysler's Expenses. Each Guarantor agrees to
pay to Chrysler, on demand, all costs and expenses, including reasonable
attorneys' and other professional and paraprofessional fees, incurred by
Chrysler in exercising any right, power or remedy conferred by this Guaranty, or
in the enforcement of this Guaranty, whether or not any action is filed in
connection therewith.
(f) Reinstatement. This Guaranty shall continue to be effective or be
reinstated, as the case may be, if at any time payment of any of the amounts
payable by any Lessee under this Agreement is rescinded or must otherwise be
restored or returned by Chrysler, upon an event of bankruptcy, dissolution,
liquidation or reorganization of any Lessee or any Guarantor or upon or as a
result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, any Lessee, any Guarantor, any other
14
<PAGE> 18
guarantor or any other Person, or any substantial part of their respective
property, or otherwise, all as though such payment had not been made.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 3.1. Representations and Warranties of the Lessees and DTAG.
Each of the Lessees hereby represents and warrants (which representations and
warranties shall be deemed made on the Series 1997-1 Closing Date) to Chrysler,
as to itself, and DTAG represents and warrants (which representations and
warranties shall be deemed made on the Series 1997-1 Closing Date) to Chrysler,
as to itself and each of the Lessees, that:
(a) Organization; Ownership; Power; Qualification. The Lessees and the
Guarantors are each (i) a corporation duly incorporated, validly existing and in
good standing under the laws of the jurisdiction of its incorporation and (ii)
has the corporate power and authority to own its properties and to carry on its
business as now being and hereafter proposed to be conducted.
(b) Authorization; Enforceability. The Lessees and the Guarantors each
has the corporate power and has taken all necessary corporate action to
authorize it to execute, deliver and perform this Agreement and each of the
Chrysler Credit Support Security Documents in accordance with its terms, and to
consummate the transactions contemplated hereby. This Agreement and each of the
Chrysler Credit Support Security Documents has been duly executed and delivered
by each of such Lessees and the Guarantors and is a legal, valid and binding
obligation of each of such Lessees and the Guarantors, enforceable in accordance
with its terms, except as may be limited by bankruptcy, insolvency,
reorganization and similar laws affecting creditors generally and by the
availability of equitable remedies.
(c) Compliance. (i) The execution, delivery and performance by each of
such Lessees and the Guarantors of this Agreement and each of the Chrysler
Credit Support Security Documents, and the consummation of the transactions
contemplated hereby, do not and will not (A) require any consent, approval,
authorization or registration not already obtained or effected, except where the
failure to obtain any such consent, approval or authorization or to register is
not reasonably likely to have a Material Adverse Effect, (B) violate any
applicable law with respect to each of such Lessees which violation is
reasonably likely to have a Material Adverse Effect, (C) conflict with, result
in a breach of, or constitute a default under the certificate of incorporation
or by-
15
<PAGE> 19
laws of any of the Lessees or the Guarantors, or under any indenture, agreement,
or other instrument to which any of such Lessees or the Guarantors is a party or
by which its properties may be bound, which conflict, breach or default is
reasonably likely to have a Material Adverse Effect, or (D) result in or require
the creation or imposition of any Lien upon or with respect to any property now
owned or hereafter acquired by any of such Lessees or the Guarantors except
Permitted Liens.
(d) Revolving Credit Agreement. Each of the representations and
warranties under the Revolving Credit Agreement and the other Loan Documents are
true and correct.
Section 3.2. Covenants of the Lessees and DTAG. So long as the
Chrysler Support Commitment is still in full force and effect or any amount is
owing to Chrysler hereunder, each of the Lessees and the Guarantors agrees that,
unless at any time Chrysler shall otherwise expressly consent in writing, it
will, and in the case of DTAG it will cause the Lessees to:
(a) Preservation of Existence; Foreign Qualification. Do and cause to
be done at all times all things necessary to (i) maintain and preserve its
corporate existence and (ii) be duly qualified to do business and in good
standing as a foreign entity in each jurisdiction where the nature of its
business makes such qualification necessary and the failure to so qualify is
reasonably likely to have a Material Adverse Effect.
(b) Accounting Methods; Financial Records. Maintain, and cause its
material Subsidiaries to maintain, a system of accounting established and
administered in accordance with GAAP, keep, and cause its material Subsidiaries
to keep, adequate records and books of account in which complete entries will be
made in accordance with such accounting principles and reflecting all
transactions required to be reflected by such accounting principles and keep,
and cause its material Subsidiaries to keep, accurate and complete records of
the Lessees's properties and assets.
(c) Financial Information, Reports, Notices, etc. Furnish or cause to
be furnished to Chrysler financial statements, reports, notices and information
as set forth in Section 8.1.1 of the Revolving Credit Agreement.
(d) Performance and Compliance with Covenants Incorporated by
Reference. Perform and comply with each of the covenants contained in the
Revolving Credit Agreement (or any other financing arrangement which may replace
the Revolving Credit Agreement) and the Master Leases (collectively, the "DTAG
Financing Agreements") as those covenants may be amended or modified from time
to time.
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<PAGE> 20
(e) No Amendment. Obtain the consent or approval of Chrysler (which
shall not be unreasonably withheld) to (i) the terms of the initial CP Program
Documents and (ii) the amendment of any of the Related Documents or any of the
CP Program Documents which could be adverse to Chrysler.
(f) Board Representation.
(i) Subject to its fiduciary duties, DTAG's Board of Directors
will nominate any person designated by Chrysler for election at each
meeting (or in each action by written consent in lieu of a meeting) of
stockholders of DTAG for the election of directors; provided that such
person (A) is not a former officer or employee of DTAG but may be an
officer or employee of Chrysler and its subsidiaries and (B) does not
have a conflict of interest with DTAG; it being understood that DTAG
agrees that Thomas Capo would be an acceptable Chrysler designee. The
Governance Committee will fill any vacancy created on the Board of
Directors as a result of the resignation or removal of a director
designated by Chrysler with any person designated by Chrysler who
satisfies the criteria set forth herein.
(ii) DTAG will use its best efforts to cause the person nominated
as provided in this Section 3.2(f) to be elected by the stockholders
of DTAG and will solicit proxies in favor of such individual or any
such successor and cause its Governance Committee to vote all proxies
in which it has discretionary authority to exercise on behalf of such
person at each meeting (or in each action by written consent in lieu
of a meeting) of stockholders of DTAG.
(iii) DTAG's obligations under this clause (f) shall terminate as
provided in Section 4.8.
(g) Downgrade of Letter of Credit Provider. In the event the credit
rating of the Series 1997-1 Letter of Credit Provider or a CP Program Letter of
Credit Provider falls below the minimum requirements of the MTN Program
Documents or CP Program Documents, respectively, or the letter of credit
provided by such Providers is set to expire prior to the termination of the MTN
Program or the CP Program, as the case may be, or, in the case of the Series
1997-1 Letter of Credit Provider, events have occurred which would permit its
replacement pursuant to Section 2.8 of the Series 1997-1 Letter of Credit
Agreement, Lessees shall use their best efforts to replace such letter of credit
providers or letters of credit with replacement providers or letters of credit
reasonably satisfactory to Chrysler.
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<PAGE> 21
(h) Fiscal Year. DTAG will not change its fiscal year without the prior
written consent of Chrysler.
(i) Credit Support Event of Default; Remedies Upon Occurrence of Credit
Support Event of Default.
(i) A breach of any obligation hereunder, any Event of Default
under the DTAG Financing Agreements or an Amortization Event shall
constitute a Credit Support Event of Default.
(ii) Upon the occurrence of a Credit Support Event of Default:
(A) an amount equal to any undrawn portion of any Chrysler
Support Letter of Credit outstanding shall, at the election of
Chrysler without demand upon or notice to DTAG or any Lessee, be
deemed to have been paid or disbursed (notwithstanding that such
amount may not in fact have been so paid or disbursed), and, upon
notification by Chrysler to DTAG, DTAG and the Lessees shall be
immediately obligated to reimburse Chrysler the amount deemed to have
been so paid or disbursed by Chrysler as if a demand had been made by
Chrysler to DTAG under Section 2.2 hereof; provided that so long as
the Intercreditor Agreement is in effect, Chrysler can make such
election only in the event of a failure by DTAG or any Lessee to (i)
provide additional collateral or an Additional Series 1997-1 Support
Letter of Credit when required by Section 2.1(a), (ii) provide
Reduction Amount Credit Support when required by Section 2.1(c), (iii)
pay within three Business Days of the due date therefor any Fees
required by Section 2.2 and (iv) make a reimbursement payment when
required by Section 2.3. Any amounts so received by Chrysler from DTAG
or the Lessees pursuant to this Section shall be held as collateral
security for the repayment of DTAG's or the Lessees' obligations in
connection with the Chrysler Support Letters of Credit (provided, that
with respect to any Support Credit Disbursement that is with respect
to a Series 1997-1 LOC Credit Disbursement for amounts owed by DTAG
under Section 4.19 of the Series 1997-1 Supplement, such obligation is
solely the obligation of DTAG). At any time when all Chrysler Support
Letters of Credit shall terminate and all its obligations thereunder
are either terminated or paid or reimbursed in full (subject, however,
to reinstatement in the event any payment in respect of such Letters
of Credit is recovered in any manner from Chrysler), Chrysler will
return to DTAG or the Lessees the aggregate amount deposited with
Chrysler and not theretofore applied by Chrysler to any reimbursement
obligation hereunder. At such time when all Credit Support Events of
Default shall have been cured or waived, Chrysler shall
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<PAGE> 22
return to DTAG and the Lessees all amounts then on deposit with
Chrysler pursuant to this Section. Earnings on all amounts on deposit
pursuant to this Section shall, until their application to any
reimbursement obligation or their return to DTAG or the Lessees, as
the case may be, shall be held by Chrysler as additional collateral
security for the repayment of DTAG's or each Lessee's obligations in
connection with the Letters of Credit issued by Chrysler;
(B) the Chrysler Support Commitment shall terminate;
(C) subject to the terms of the Intercreditor Agreement,
Chrysler shall be entitled to exercise all of its remedies under the
Credit Support Security Documents together with any and all other
remedies available to it under law; and
(D) Chrysler may seek specific performance of any of the
non-monetary obligations of DTAG or any Lessee hereunder.
Section 3.3. Injunctive Relief with Respect to Certain Covenants. DTAG
acknowledges and agrees that the covenants and obligations of DTAG under Section
3.2(f) relate to special, unique and extraordinary matters and that a violation
of any of the terms of such covenants and obligations will cause Chrysler
irreparable injury for which adequate remedies are not available at law.
Therefore, DTAG agrees that Chrysler shall be entitled to an injunction,
restraining order or such other equitable relief (without the requirement to
post bond) restraining DTAG from committing any violation of the coven ants and
obligations contained in Section 3.2(f). These injunctive remedies are
cumulative and are in addition to any other rights and remedies Chrysler may
have at law or in equity.
Section 3.4. Chrysler Covenants. Chrysler covenants and agrees with
the Lessees and DTAG that, on the Series 1997-1 Closing Date, it will provide to
the Trustee, DTAG, each of the Lessees, and the Series 1997-1 Letter of Credit
Provider, the favorable written opinion of counsel to Chrysler, addressing the
due authorization, execution and delivery of the Chrysler Series 1997-1 Support
Letter of Credit and the enforceability thereof against Chrysler.
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<PAGE> 23
ARTICLE IV
MISCELLANEOUS
Section 4.1. Payments. (a) Unless otherwise specified herein, all
payments to Chrysler hereunder shall be made in lawful currency of the United
States and in immediately available funds prior to 11:00 a.m. (New York City
time) on the date such payment is due by wire transfer to Chrysler, Account No.
144-0-25784 at Chase Manhattan Bank, or to such other office or account
maintained by Chrysler as Chrysler may direct.
(b) Whenever any payment under this Agreement shall be stated to be
due on a day which is not a Business Day, unless otherwise stated herein, such
payment shall be made on the next succeeding Business Day, and such extension of
time shall in such case be included in computing interest, if any, in connection
with such payment.
Section 4.2. Notices. All notices, amendments, waivers, consents and
other communications provided to any party hereto under this Agreement or any
other Related Document shall be in writing and addressed, delivered or
transmitted to such party at its address or facsimile number set forth below or
at such other address or facsimile number as may be designated by such party in
a notice to the other parties. Any notice, if mailed and properly addressed with
postage prepaid or if properly addressed and sent by pre-paid courier service,
shall be deemed given when received; any notice, if transmitted by facsimile,
shall be deemed given when transmitted upon receipt of electronic confirmation
of transmission.
If to Chrysler:
Chrysler Corporation
1000 Chrysler Drive
Auburn Hills, Michigan 48326-2766
CIM 485-13-96
Attention: Treasurer
Telephone: (248) 512-6130
Telecopier: (248) 512-1768
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<PAGE> 24
If to the Series 1997-1 Letter of Credit Provider:
Credit Suisse First Boston
Five World Trade Center
New York, New York 10048
Attention: Adrian Silghigian
Telephone: (212) 322-0046
Telecopier: (212) 803-2079
If to DTAG:
Dollar Thrifty Automotive Group, Inc.
5330 East 31st Street
Tulsa, OK 74135
Attention: Treasurer
Telephone: (918) 669-2288
Telecopier: (918) 669-2934
If to any of the Lessees or the Guarantors (other than DTAG): To the
address of such Person set forth in Schedule 1 hereof.
Section 4.3. Amendments, etc. This Agreement and the rights and
obligations of the parties hereunder may not be changed orally but only by an
instrument in writing signed by each party hereto and shall be construed in
accordance with and governed by the laws of the State of New York. In the event
of any conflict between the provisions of this Agreement and the Chrysler Series
1997-1 Support Letter of Credit, the provisions of the Chrysler Series 1997-1
Support Letter of Credit shall control.
Section 4.4. Consent to Jurisdiction. ALL JUDICIAL PROCEEDINGS BROUGHT
AGAINST CHRYSLER, ANY GUARANTOR OR ANY LESSEE WITH RESPECT TO THIS AGREEMENT
SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN ANY STATE OR (TO THE EXTENT
PERMITTED BY LAW) FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE OF NEW
YORK AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT CHRYSLER, THE GUARANTORS,
AND THE LESSEES EACH ACCEPT FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES,
GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID
COURTS, AND
21
<PAGE> 25
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH THIS AGREEMENT. EACH OF THE LESSEES AND THE GUARANTORS AGREES THAT SERVICE
UPON IT BY REGISTERED MAIL SHALL CONSTITUTE SERVICE OF PROCESS IN ANY SUCH
PROCEEDINGS IN ANY SUCH COURT, SUCH SERVICE BEING HEREBY ACKNOWLEDGED BY THE
GUARANTORS AND EACH OF THE LESSEES TO BE EFFECTIVE AND BINDING SERVICE IN EVERY
RESPECT. NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF CHRYSLER TO BRING
PROCEEDINGS AGAINST THE LESSEES OR DTAG IN THE COURTS OF ANY OTHER JURISDICTION.
Section 4.5. Waiver of Jury Trial. CHRYSLER, THE GUARANTORS AND THE
LESSEES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY
MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR
ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF
CHRYSLER, THE GUARANTORS OR THE LESSEES IN CONNECTION HEREWITH OR THEREWITH.
CHRYSLER, THE LESSEES AND THE GUARANTORS EACH ACKNOWLEDGE AND AGREE THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR CHRYSLER ENTERING INTO THIS AGREEMENT.
Section 4.6. Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE AN
AGREEMENT MADE UNDER, AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
Section 4.7. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 4.8. Term. This Agreement shall remain in full force and
effect until (i) the termination of the Chrysler Support Commitment and (ii) the
reimbursement of all Support Credit Disbursements, Support Termination
Disbursements, Support Reduction
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Disbursements and Support Event of Default Disbursements, and the payment by
DTAG and the Lessees of all other amounts payable hereunder, notwithstanding the
earlier termination of the Chrysler Series 1997-1 Support Letter of Credit or
any other form of credit support provided by Chrysler hereunder.
Section 4.9. Successors and Assigns. This Agreement shall be binding
upon Chrysler and its successors and assigns, DTAG and its successors and
assigns and the Lessees and their successors and assigns; provided, however,
that none of DTAG or the Lessees may transfer or assign any of its obligations,
rights, or interests hereunder without the prior written consent of Chrysler.
Section 4.10. Counterparts. This Agreement may be executed in any
number of counterparts, and by the different parties hereto on the same or
separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute one and the same agreement.
Section 4.11. Further Assurances. DTAG and the Lessees each agree to
do such further acts and things and to execute and deliver to Chrysler such
additional assignments, agreements, powers and instruments as are reasonably
required by Chrysler to carry into effect the purposes of this Agreement or to
better assure and confirm to Chrysler its rights, powers and remedies hereunder.
Section 4.12. Survival of Obligations. The obligations of DTAG and the
Lessees under Sections 2.2, 2.6, 2.7, 4.1 and 4.2 shall in each case survive any
termination of this Agreement, the payment in full of all obligations hereunder
and the termination of the Chrysler Series 1997-1 Support Letter of Credit or
any other form of credit support provided by Chrysler hereunder.
Section 4.13. Obligation. Chrysler, DTAG and each of the Lessees each
under stands and agrees that the Chrysler Support Letters of Credit is
irrevocable and the obligations of Chrysler thereunder shall be unaffected by
any default hereunder. None of the failure of DTAG or any of the Lessees (or any
person or organization acting on behalf of either) or the Trustee or the Series
1997-1 Letter of Credit Provider to take any action (whether required hereunder
or under any other Related Document otherwise), nor any action taken by DTAG or
any of the Lessees shall be asserted by Chrysler as a defense to payment under a
Chrysler Support Letter of Credit (except for the failure of any documents
presented thereunder to comply with the terms of a Chrysler Support Letter of
Credit) or as the basis of a right of set off by Chrysler against its
obligations to make any such payment.
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<PAGE> 27
Section 4.14. Headings. Section headings in this Agreement are
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.
Section 4.15. Application of Funds. Upon receipt of the deposited
funds from the Series 1997-1 Cash Collateral Account pursuant to Section 4.21 of
the Series 1997-1 Supplement, Chrysler shall apply such amounts to the payment
in full of any and all obligations of the Lessees under or in respect of the
Chrysler Series 1997-1 Support Letter of Credit hereunder; any amounts remaining
thereafter shall be returned to the Lessees or to whomever is legally entitled
thereto.
Section 4.16. Subordination of Obligations Pursuant to Group I
Collateral Sharing Agreement. The parties hereto hereby acknowledge and agree
that the obligations of DTAG and each of the Lessees represented hereby are
subject to the terms and provisions of the Group I Collateral Sharing Agreement
which, among other things, contains provisions subordinating to the prior
payment in full, in cash, of the obligations hereunder of DTAG and each of the
Lessees to the obligations of DTAG and each of the Lessees to the holders of
Senior Obligations (as defined in the Group I Collateral Sharing Agreement) in
the manner provided in the Group I Collateral Sharing Agreement, to which
provisions each of the parties hereunder agrees.
Section 4.17. Additional Lessees. Any direct or indirect Subsidiary of
or other Affiliate of DTAG (each a "DTAG Affiliate") shall have the right to
become a "Lessee" under and pursuant to the terms of this Agreement by complying
with the provisions of Section 28 of the Master Lease and the provisions of this
Section 4.17. In the event a DTAG Affiliate desires to become a "Lessee" under
this Agreement, then DTAG and such DTAG Affiliate shall execute and deliver to
Chrysler a joinder agreement, in form and substance satisfactory to Chrysler,
under which it assumes all the obligations of a "Lessee" hereunder and under the
Chrysler Credit Support Security Documents together with such legal opinions and
other certificates as Chrysler may reasonably require to evidence the assumption
by such DTAG Affiliate of the obligations and liabilities set forth in this
Agreement and in the Chrysler Credit Support Security Documents.
Section 4.18. Additional Guarantors.
Section 4.19. Indemnification. Lessees agree to indemnify and
reimburse Chrysler promptly upon demand for any payments made by Chrysler under
Sections 2.6, 2.7, 2.8, 4.1, 4.2 and 4.3 of the Series 1997-1 Letter of Credit
Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their duly authorized officers, as of the day and year first
above written.
CHRYSLER CORPORATION
By:
-----------------------------
Name:
Title:
DOLLAR THRIFTY AUTOMOTIVE
GROUP, INC.
By:
-----------------------------
Name:
Title:
<PAGE> 29
LESSEES:
DOLLAR RENT A CAR SYSTEMS, INC.
By:
-----------------------------
Name:
Title:
THRIFTY RENT-A-CAR SYSTEM, INC.
By:
-----------------------------
Name:
Title:
ADDITIONAL GUARANTORS:
TRAC TEAM, INC.
By:
-----------------------------
Name:
Title:
DTAG SERVICES, INC.
By:
-----------------------------
Name:
Title:
<PAGE> 1
EXHIBIT 4.12
[EXECUTION COPY]
================================================================================
RENTAL CAR FINANCE CORP.,
as Issuer
and
BANKERS TRUST COMPANY,
as Trustee and as Enhancement Agent
----------------------
SERIES 1998-1 SUPPLEMENT
dated as of March 4, 1998
to
BASE INDENTURE
dated as of December 13, 1995,
as amended by
AMENDMENT TO BASE INDENTURE,
dated as of December 23, 1997
Rental Car Asset Backed Variable Funding Notes, Series 1998-1
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE 1
DESIGNATION
ARTICLE 2.
DEFINITIONS AND CONSTRUCTION
ARTICLE 3.
Section 3.1 Grant of Security Interest. . . . . . . . . . . . . . . . . . . . 37
ARTICLE 4A.
INITIAL ISSUANCE AND INCREASES AND DECREASES OF
SERIES 1998-1 INVESTED AMOUNT OF SERIES 1998-1 NOTES
Section 4A.1 Issuance in Definitive Form . . . . . . . . . . . . . . . . . . . 39
Section 4A.2 Procedure for Increasing the Series 1998-1 Invested Amount . . . 39
Section 4A.3 Decreases . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE 4.
ALLOCATION AND APPLICATION OF COLLECTIONS
Section 4.6 Establishment of Group II Collection Account, Series 1998-1
Collection Account, Series 1998-1 Excess Funding Account,
and Series 1998-1 Accrued Interest Account . . . . . . . . . . 43
Section 4.7 Allocations with Respect to the Series 1998-1 Notes . . . . . . . 44
Section 4.8 Monthly Payments . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 4.9 Payment of Note Interest. . . . . . . . . . . . . . . . . . . . . 55
Section 4.10 Payment of Note Principal . . . . . . . . . . . . . . . . . . . . 56
Section 4.11 Retained Distribution Account . . . . . . . . . . . . . . . . . . 59
Section 4.12 Series 1998-1 Distribution Account . . . . . . . . . . . . . . . 59
</TABLE>
<PAGE> 3
<TABLE>
<S> <C> <C>
Section 4.13 The Servicer's Failure to Instruct the Trustee to Make a
Deposit or Payment . . . . . . . . . . . . . . . . . . . . . . 61
Section 4.14 Draws on Series 1998-1 Letter of Credit . . . . . . . . . . . . . 61
Section 4.15 Draw on the Demand Note . . . . . . . . . . . . . . . . . . . . . 62
Section 4.16 Series 1998-1 Letter of Credit Termination Demand . . . . . . . . 63
Section 4.17 Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 4.18 The Series 1998-1 Cash Collateral Account . . . . . . . . . . . . 64
Section 4.19. Appointment of Enhancement Agent . . . . . . . . . . . . . . . . 67
ARTICLE 5.
AMORTIZATION EVENTS
Section 5.1 Series 1998-1 Amortization Events . . . . . . . . . . . . . . . . 67
Section 5.2 Waiver of Past Events . . . . . . . . . . . . . . . . . . . . . . 69
ARTICLE 6.
COVENANTS
Section 6.1 Minimum Subordinated Amount. . . . . . . . . . . . . . . . . . . 69
Section 6.2 Minimum Letter of Credit Amount . . . . . . . . . . . . . . . . . 69
ARTICLE 7.
FORM OF SERIES 1998-1 NOTES
ARTICLE 8.
GENERAL
Section 8.1 Payment of Rating Agencies' Fees . . . . . . . . . . . . . . . . 70
Section 8.2 Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 8.3 Ratification of Base Indenture . . . . . . . . . . . . . . . . . 70
Section 8.4 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 8.5 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 8.6 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
</TABLE>
Schedule 1 - Maximum Manufacturer Percentages
Exhibit A - Form of Rental Car Asset Backed Variable Funding Note,
Series 1998-1
-ii-
<PAGE> 4
Exhibit B - [Reserved]
Exhibit C - Form of Demand Note
Exhibit D - Form of Notice of Series 1998-1 Lease Payment Losses
-iii-
<PAGE> 5
THIS SERIES 1998-1 SUPPLEMENT, dated as of March 4, 1998 (as
the same may be amended, supplemented, restated or otherwise modified from time
to time in accordance with the terms hereof and of the Base Indenture referred
to below, this "Supplement"), between RENTAL CAR FINANCE CORP., formerly known
as Thrifty Car Rental Finance Corporation, a special purpose Oklahoma
corporation ("RCFC" or the "Issuer"), and BANKERS TRUST COMPANY, a New York
banking corporation (together with its successors in trust thereunder as
provided in the Base Indenture referred to below, the "Trustee"), and as
enhancement agent(in such capacity, the "Enhancement Agent") to the Base
Indenture, dated as of December 13, 1995, between RCFC and the Trustee, as
amended by Amendment to Base Indenture, dated as of December 23, 1997, between
RCFC and the Trustee (as amended by such amendment and as the same may be
further amended, supplemented, restated or otherwise modified from time to time
in accordance with its terms, exclusive of Supplements creating a new Series of
Notes, the "Base Indenture").
W I T N E S S E T H:
WHEREAS, Sections 2.2, 2.3, 11.1 and 11.3 of the Base
Indenture provide, among other things, that RCFC and the Trustee may at any
time and from time to time enter into a Series Supplement to the Base Indenture
for the purpose of authorizing the issuance of one or more Series of Notes;
NOW, THEREFORE, in consideration of the foregoing premises,
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged by the parties hereto, the parties hereto hereby agree
as follows:
ARTICLE 1
DESIGNATION
(a) There is hereby created a Series of Notes to be issued
pursuant to the Base Indenture and this Supplement and such Series of Notes
shall be designated generally as Rental Car Asset Backed Variable Funding
Notes, Series 1998-1. The Rental Car Asset Backed Variable Funding Notes,
Series 1998-1, shall be issued in one class and shall be referred to
collectively as the "Series 1998-1 Notes".
(b) The net proceeds from the sale of and Increases in
respect of the Series 1998-1 Notes shall be deposited into the Collection
Account, and such proceeds and the proceeds of Increases in respect thereof
shall be used (i) on and after the Series 1998-1 Closing Date, to refinance the
Existing Fleet, (ii) on and after the Series 1998-1 Closing Date, to finance or
refinance the acquisition by the Issuer, Thrifty or Dollar of Financed Vehicles
or Eligible Receivables,(iii) on and after the Series 1998-1 Closing Date, to
acquire Acquired Vehicles from
<PAGE> 6
certain Eligible Manufacturers, and (iv) in certain circumstances, to pay
principal on amortizing Group II Series of Notes other than the Series 1998-1
Notes.
(c) The Series 1998-1 Notes are a Segregated Series of Notes
(as more fully described in the Base Indenture) and are hereby designated as a
"Group II Series of Notes". The Issuer may from time to time issue additional
Segregated Series of Notes that the related Series Supplements will indicate
are entitled to share, together with the Series 1998-1 Notes, the Group II
Collateral and any other Collateral and Master Collateral designated as
security for the Series 1998-1 Notes under this Supplement and the Master
Collateral Agency Agreement or any other Group II Series of Notes under the
related Series Supplement and the Master Collateral Agency Agreement (the
Series 1998-1 Notes and any such additional Segregated Series, each, a "Group
II Series of Notes" and, collectively, the "Group II Series of Notes").
Accordingly, all references in this Supplement to "all" Series of Notes (and
all references in this Supplement to terms defined in the Base Indenture that
contain references to "all" Series of Notes) shall refer to all Group II Series
of Notes.
ARTICLE 2.
DEFINITIONS AND CONSTRUCTION
(a) All capitalized terms not otherwise defined in this
Supplement are defined in the Definitions List attached to the Base Indenture
as Schedule 1 thereto (as the same may be amended, supplemented, restated or
otherwise modified from time to time in accordance with the terms of the Base
Indenture, the "Definitions List"). All capitalized terms defined in this
Supplement that are also defined in the Definitions List to the Base Indenture
shall, unless the context otherwise requires, have the meanings set forth in
this Supplement. All references to "Articles", "Sections" or "Subsections"
herein shall refer to Articles, Sections or Subsections of the Base Indenture,
except as otherwise provided herein. Unless otherwise stated herein, as the
context otherwise requires or if such term is otherwise defined in the Base
Indenture, each capitalized term used or defined herein shall relate only to
the Series 1998-1 Notes and not to any other Series of Notes issued by the
Issuer. In addition, with respect to the Series 1998-1 Notes, references in
the Base Indenture to (i) the "Lease" shall be deemed to refer to the Master
Lease, (ii) "Thrifty Finance" shall be deemed to refer to RCFC, (iii) "Lessee"
shall be deemed to refer to any or all of the Lessees, as the context requires,
(iv) "Servicer" shall be deemed to refer to the Master Servicer, and (v) when
the terms "Lease," "Thrifty Finance," "Lessee" or "Servicer" are imbedded in a
defined term within the Base Indenture, they shall be deemed to refer to the
corresponding concept ascribed in clauses (i) through (iv), as applicable,
except in each case as otherwise specified in this Supplement or as the context
may otherwise require.
(b) The following words and phrases shall have the following
meanings with respect to the Series 1998-1 Notes, and the definitions of such
terms are applicable to the singular as well as the plural form of such terms
and to the masculine as well as the feminine and neuter genders of such terms:
-2-
<PAGE> 7
"Accrued Amounts" means, with respect to any Group II Series
of Notes (or any class (or portion thereof)), on any date of determination, the
sum of (i) accrued and unpaid interest on the Notes of such Series (or the
applicable class thereof) as of such date, (ii) the portion of the accrued and
unpaid Monthly Servicing Fee and any Supplemental Monthly Servicing Fee
allocated to such Series of Notes (or the applicable class thereof) pursuant to
the related lease or leases (which with respect to the Series 1998-1 Notes is
pursuant to Section 26.1 of the Master Lease), and (iii) the product of (A) all
other accrued and unpaid fees and expenses of RCFC on such date, times (B) a
fraction, the numerator of which is the Series 1998-1 Invested Amount of such
Group II Series of Notes (or the applicable class thereof) on such date and the
denominator of which is the Aggregate Invested Amount for all outstanding
Series of Notes on such date.
"Acquired Vehicles" means any Eligible Vehicles acquired by
RCFC on and after the Series 1998-1 Closing Date and leased by RCFC to any of
the Lessees under Annex A of the Master Lease.
"Additional Depreciation Charge" means, with respect to each
Non-Program Vehicle leased under the Master Lease as of the last day of the
Related Month, an amount (which may be zero) allocated to such Non-Program
Vehicle by the Master Servicer such that the sum of such amounts with respect
to all Non-Program Vehicles shall be equal to the amount, if any, by which the
aggregate Net Book Value of all such Non-Program Vehicles exceeds the three (3)
month rolling average of the aggregate Market Value of such Non-Program
Vehicles determined as of such day and the first day of each of the two (2)
calendar months preceding such day.
"Additional Lessee" has the meaning specified in Section 28 of
the Master Lease.
"Additional Overcollateralization Amount" means, as of any
date of determination, an amount equal to (a) the Overcollateralization Portion
on such date divided by the Series 1998-1 Enhancement Factor as of such date
minus (b) the Overcollateralization Portion as of such date.
"Adjusted EBITDA" means, for any applicable period, the excess
of
(a) EBITDA for such period
over
(b) to the extent added in arriving at such EBITDA, the sum of
(i) the aggregate amount of depreciation in respect of Vehicles during
such period plus (ii) Vehicle Interest Expense during such period.
"Aggregate Asset Amount" means, with respect to the Series
1998-1 Notes, on any date of determination, without duplication, the sum of (i)
the Net Book Value of all Group II
-3-
<PAGE> 8
Vehicles with respect to which the applicable Vehicle Lease Expiration Date has
not occurred, (ii) all Manufacturer Receivables, as of such date, due to RCFC,
Thrifty or Dollar from Eligible Manufacturers under and in accordance with
their respective Eligible Vehicle Disposition Programs, or from Eligible
Manufacturers as incentive payments, allowances, premiums, supplemental
payments or otherwise, in each case with respect to Group II Vehicles at any
time owned, financed or refinanced by RCFC or with respect to amounts otherwise
transferred to RCFC and pledged to the Master Collateral Agent, plus (iii) all
amounts (other than amounts specified in clause (ii) above) receivable, as of
such date, by RCFC, Thrifty or Dollar from any Person in connection with the
auction, sale or other disposition of Group II Vehicles, plus (iv) all accrued
and unpaid Monthly Base Rent and Monthly Supplemental Payments (other than
amounts specified in clauses (ii) and (iii) above) payable in respect of the
Group II Vehicles, plus (v) cash and Permitted Investments on deposit in the
Collection Account allocable to the Group II Series of Notes and, to the extent
cash and Permitted Investments in the Master Collateral Account are allocable
to the Trustee as Beneficiary pursuant to the Master Collateral Agency
Agreement and are not distributable to or at the direction of DTAG, Thrifty or
Dollar, as the case may be, in their respective capacities as Master Servicer
or Servicers pursuant thereto, cash and Permitted Investments in the Master
Collateral Account to the extent cash and Permitted Investments constitute
Group II Collateral (less any portion thereof allocated to the Retained
Interestholder).
"Aggregate Interest Expense" is defined in clause (a) of the
definition of "Non-Vehicle Interest Expense".
"Annual Certificate" is defined in Section 24.4(g) of the
Master Lease.
"Asset Amount Deficiency" means, as of any date of
determination, the amount, if any, by which the Required Asset Amount exceeds
the Aggregate Asset Amount, as of such date of determination.
"Assignment Agreement" means a Vehicle Disposition Program
Assignment Agreement, in the form attached as Exhibit F to the Master
Collateral Agency Agreement, or in such other form as is acceptable to each
Rating Agency, between a Lessee and/or RCFC as the case may be, as assignor,
and the Master Collateral Agent, as assignee, and acknowledged by the
applicable Manufacturer, pursuant to which such Lessee and/or RCFC, as the case
may be, assigns as collateral to the Master Collateral Agent all of such
Lessee's and/or RCFC's, as the case may be, right, title and interest in, to
and under a Vehicle Disposition Program.
"Authorized Officer" means (a) as to RCFC, any of its
President, any Vice President, the Secretary or any Assistant Secretary and (b)
as to DTAG (including in its capacity as the Master Servicer), Thrifty
(including in its capacities as a Lessee and as a Servicer), Dollar (including
in its capacities as a Lessee and as a Servicer), any Additional Lessee or
additional Servicer, those officers, employees and agents of DTAG, Thrifty,
Dollar, such Additional Lessee or such other Servicer, as the case may be, in
each case whose signatures and incumbency shall
-4-
<PAGE> 9
have been certified as the authentic signatures of duly qualified and elected
persons authorized to act on behalf of such entities.
"Availability Payment" is defined in Section 5.2 of the Master
Lease.
"Base Indenture" has the meaning set forth in the preamble
hereto.
"Board of Directors" means the Board of Directors of DTAG,
RCFC, Thrifty or Dollar, as applicable, or any authorized committee of the
Board of Directors.
"Capital Expenditures" means, for any period, the sum of
(a) the aggregate amount of all expenditures of DTAG and its
Subsidiaries for fixed or capital assets made during such period
which, in accordance with GAAP, would be classified as capital
expenditures; and
(b) the aggregate amount of all Capitalized Lease Liabilities
incurred during such period.
"Capital Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated) of
such Person's capital stock or equity, whether now outstanding or issued after
the date hereof, including all common stock, preferred stock, partnership
interests and member interests.
"Capitalized Lease Liabilities" means all monetary obligations
of DTAG or any of its Subsidiaries under any leasing or similar arrangement
which, in accordance with GAAP, would be classified as capitalized leases, and,
for purposes of this Supplement and each other Related Document, the amount of
such obligations shall be the capitalized amount thereof, determined in
accordance with GAAP, and, with respect to any such leasing or similar
arrangement, the stated maturity thereof shall be the date of the last payment
of rent or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a premium
or a penalty.
"Carrying Charges" means, as of any day, (i) without
duplication, the aggregate of all Trustee fees, servicing fees (other than
supplemental servicing fees) and other fees and expenses and indemnity amounts,
if any, payable by the Issuer, the Master Servicer or any Servicer under the
Indenture, the Note Purchase Agreement or the other Related Documents which
have accrued with respect to the Series 1998-1 Notes during the Related Month,
plus (ii) without duplication, all amounts payable by the Lessees (in case of a
Lease Event of Default) which have accrued during the Related Month.
"Carryover Controlled Amortization Amount" means, with respect
to the Series 1998-1 Notes for any Related Month during the Series 1998-1
Controlled Amortization Period, (i) the excess, if any, of the Controlled
Distribution Amount payable on the Payment Date
-5-
<PAGE> 10
occurring in the Related Month over the principal amount distributed on such
Payment Date with respect to the Series 1998-1 Notes pursuant to Section
4.10(a) of this Supplement, plus (ii) the unpaid amount, if any, of the
Carryover Controlled Amortization Amount for the previous Related Month;
provided, however, that for the first Related Month in the Series 1998-1
Controlled Amortization Period, the Carryover Controlled Amortization Amount
shall be zero, plus (iii) all operating and ordinary course expenses of DTFC up
to an aggregate amount equal to $100,000.
"Casualty" means, with respect to any Vehicle, that (i) such
Vehicle is lost, stolen (and not recovered within 60 days of being reported
stolen), destroyed, damaged, seized or otherwise rendered permanently unfit or
unavailable for use, (including vehicles that are rejected pursuant to Section
2.2 of the Master Lease), or (ii) such Vehicle is not accepted for Auction or
repurchase by the Manufacturer in accordance with the related Vehicle
Disposition Program for any reason within thirty (30) days of initial
submission and is not designated a Non-Program Vehicle pursuant to Section 14
of the Master Lease (other than, in the case of clause (ii) above, the
applicable Manufacturer's willful refusal or inability to comply with its
obligations under its Vehicle Disposition Program)
"Casualty Payment" is defined in Section 7 of the Master
Lease.
"Certificate of Credit Demand" means a certificate in the form
of Annex A to the Series 1998-1 Letter of Credit.
"Certificate of Liquidity Demand" means a certificate in the
form of Annex B to the Series 1998-1 Letter of Credit.
"Certificate of Termination Demand" means a certificate in the
form of Annex C to the Series 1998-1 Letter of Credit.
"Chrysler Financial Corporation" means Chrysler Financial
Corporation, a Delaware corporation.
"Chrysler Vehicle Lien Nominee Agreement" means that certain
Vehicle Lien Nominee Agreement, dated as of December 23, 1997, between Chrysler
Financial Corporation and RCFC, as the same may be amended, restated,
supplemented or otherwise modified from time to time in accordance with the
terms thereof, or the Limited Guarantee and Reimbursement Agreement, as
applicable.
"Collateral Agent" means Bankers Trust Company in its capacity
as collateral agent under the Collateral Agreement, and any successor thereto.
"Collateral Agreement" has the meaning specified in the
Definitions List attached as Annex A to the Liquidity Agreement.
-6-
<PAGE> 11
"Collections" means(i) all payments including, without
limitation, all Recoveries and Lease Payment Recoveries, by, or on behalf of a
Lessee under the Master Lease, (ii) all Credit Draws under the Series 1998-1
Letter of Credit and withdrawals from the Series 1998-1 Cash Collateral
Account, (iii) all payments including, without limitation, all Recoveries and
Lease Payment Recoveries, by, or on behalf of any Manufacturer, under its
Vehicle Disposition Program or any incentive program, with respect to any Group
II Vehicles, (iv) all payments including, without limitation, all Recoveries
and Lease Payment Recoveries, by, or on behalf of any other Person as proceeds
from the sale of Group II Vehicles, payment of insurance proceeds, whether such
payments are in the form of cash, checks, wire transfers or other form of
payment and whether in respect of principal, interest, repurchase price, fees,
expenses or otherwise and (v) all amounts earned on Permitted Investments
arising out of funds in the Group II Collection Account and in the Master
Collateral Account (to the extent allocable to the Trustee on behalf of the
holders of the Group II Series of Notes as Beneficiary thereunder).
"Commercial Paper Notes" means the promissory notes of DTFC
issued by DTFC in the commercial paper market pursuant to the Depositary
Agreement.
"Condition Report" means a condition report with respect to a
Group II Vehicle, signed and dated by a Lessee or a Franchisee and any
Manufacturer or its agent in accordance with the applicable Vehicle Disposition
Program.
"Consolidated Working Capital" means, with respect to DTAG,
at any date, the excess (or the deficit) of (a) the sum of the amounts that, in
accordance with GAAP, are set forth opposite the captions "accounts and notes
receivable, net", "prepaid expenses and other assets" and "income taxes
receivable", or any like captions, at such date over (b) the sum of the amounts
that, in accordance with GAAP, are set forth opposite the captions "accounts
payable", "accrued liabilities" and "income taxes payable", or any like
captions, at such date.
"Controlled Amortization Amount" means an amount equal to one
ninth of the Invested Amount as of the commencement of the Series 1998-1
Controlled Amortization Period.
"Controlled Distribution Amount" means, with respect to any
Related Month during the Series 1998-1 Controlled Amortization Period, an
amount equal to the sum of the Controlled Amortization Amount and any Carryover
Controlled Amortization Amount for such Related Month.
"CP Enhancement Letter of Credit Application and Agreement"
means the CP Enhancement Letter of Credit Application and Agreement, dated as
of March 4, 1998, among DTFC, Dollar, Thrifty, those additional Subsidiaries of
DTAG from time to time becoming parties thereunder, RCFC, DTAG and CSFB, in its
capacity as the Series 1998-1 Letter of Credit Provider, as the same may be
amended, restated, supplemented or otherwise modified from time to time in
accordance with the terms thereof.
-7-
<PAGE> 12
"Credit Agreement" means the Credit Agreement, dated as of
December 23, 1997, among DTAG, Dollar and Thrifty, as borrowers, the financial
institutions from time to time party thereto, as lenders, CSFB, as
administrative agent for the lenders, The Chase Manhattan Bank, as syndication
agent for the lenders, and CSFB and Chase Securities Inc. as co-arrangers, as
the same may be amended, supplemented, restated or otherwise modified from time
to time in accordance with its terms.
"Credit Demand" means a demand for a LOC Credit Disbursement
under the Series 1998-1 Letter of Credit pursuant to a Certificate of Credit
Demand.
"Credit Draw" means a draw on the Series 1998-1 Letter of
Credit pursuant to a Certificate of Credit Demand.
"Daily Interest Amount" means, for any day in a Series 1998-1
Interest Period, an amount equal to (a) the product of (i) the Series 1998-1
Note Rate for such Series 1998-1 Interest Period and (ii) the Series 1998-1
Invested Amount as of the close of business on such date, divided by (b) 360.
"Daily Report" is defined in Section 24.4(a) of the Master
Lease.
"DCR" means Duff & Phelps Credit Rating Co.
"Decrease" means a Voluntary Decrease or a Mandatory Decrease,
as applicable.
"Defaulting Manufacturer" is defined in Section 18 of the
Master Lease.
"Demand Note" means that certain Demand Note, dated as of
March 4, 1998, made by DTAG to the Issuer in substantially the form attached as
Exhibit C to this Supplement.
"Depositary Agreement" means the Depositary Agreement, dated
as of March 4, 1998, between DTFC and Bankers Trust Company, as depositary, as
the same may be amended, restated, supplemented or otherwise modified from time
to time in accordance with the terms thereof.
"Depreciation Charge" means, for any date of determination,
(a) with respect to any Program Vehicle leased under the Master Lease, the
scheduled daily depreciation charge for such Vehicle set forth by the
Manufacturer in its Vehicle Disposition Program for such Vehicle, and (b) with
respect to any Non-Program Vehicle leased under the Master Lease, (i) the
scheduled daily depreciation charge for such Vehicle set forth by the Servicer
in the Depreciation Schedule for such Vehicle plus (ii) as of the last day of
the Related Month, the Additional Depreciation Charge, if any, allocable to
such Non-Program Vehicle on such day (which Additional Depreciation Charge
shall, for purposes of determining the Monthly Base Rent payable on such day,
be deemed to have accrued during the Related Month). If such charge is
-8-
<PAGE> 13
expressed as a percentage, the Depreciation Charge for such Vehicle for such
day shall be such percentage multiplied by the Capitalized Cost for such
Vehicle.
"Depreciation Schedule" means a schedule of estimated daily
depreciation prepared by the applicable Servicer, and revised from time to time
in the applicable Servicer's sole discretion, with respect to each type of Non-
Program Vehicle that is an Eligible Vehicle and that is purchased, financed or
refinanced by RCFC.
"Distribution" means, with respect to any Person, any dividend
or distribution (in cash, property or obligations) on any shares of any class
of Capital Stock (now or hereafter outstanding) of such Person or on any
warrants, options or other rights with respect to any shares of any class of
Capital Stock (now or hereafter outstanding) of such Person, other than
dividends or distributions payable in the common stock (other than Redeemable
Capital Stock) of such Person or warrants or options to purchase such common
stock or split-ups or reclassifications of its Capital Stock into additional or
other shares of such common stock.
"Dollar" means Dollar Rent A Car Systems, Inc., an Oklahoma
corporation.
"DTAG" means Dollar Thrifty Automotive Group, Inc., a Delaware
corporation.
"DTFC" means Dollar Thrifty Funding Corp., an Oklahoma
corporation.
"EBITDA" means, for any applicable period, the sum for such
period of
(a) Net Income (excluding therefrom (i) the effect of any
extraordinary or other non-recurring gain or loss outside the ordinary
course of business, (ii) any write-up (or write-down) in the value of
any asset, (iii) the earnings (or loss) of any Person (other than DTAG
or any other Subsidiary of DTAG) in which DTAG or any of its
Subsidiaries has an ownership interest, except to the extent of the
amount of dividends or other distributions actually paid in cash to
DTAG or any of its Subsidiaries by such Person during such period,
(iv) except where the provisions hereof expressly require a pro forma
determination, the earnings (or loss) of any Person accrued prior to
the date it becomes a Subsidiary of DTAG or is merged into or
consolidated with any of its Subsidiaries or the date that such other
Person's assets are acquired by any Subsidiary of DTAG and (v) the
earnings of any Subsidiary of DTAG that is neither a Subsidiary
Borrower nor a Subsidiary Guarantor to the extent that the declaration
or payment of dividends or similar distributions by such Subsidiary of
such earnings is not at the time permitted by operation of the terms
of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to such
Subsidiary)
-9-
<PAGE> 14
plus
(b) to the extent deducted in arriving at such Net Income,
the sum, without duplication, of (i) Aggregate Interest Expense, plus
(ii) taxes computed on the basis of income plus (iii) the aggregate
amount of depreciation and amortization of tangible and intangible
assets, plus (iv) non-cash charges in respect of non-cash awards under
DTAG's incentive compensation programs.
"Eligible Credit Enhancer" means (a) a commercial bank having
total assets in excess of $500,000,000, (b) a finance company, insurance
company or other financial institution that in the ordinary course of business
enters into transactions of a type similar to that entered into by the Series
1998-1 Letter of Credit Provider under the CP Enhancement Letter of Credit
Application and Agreement and has total assets in excess of $200,000,000, and
with respect to which providing or becoming an assignee of the obligations of
the Series 1998-1 Letter of Credit Provider would not constitute a prohibited
transaction under Section 4975 of ERISA and (c) any other financial
institution, in each case reasonably satisfactory to DTAG having a short-term
rating at least equal to A-1, or better, by S&P, at least equal to P-1, or
better, by Moody's and, if such financial institution is rated by DCR, at
least equal to D-1, or better, by DCR; provided, however, that any Person who
does not have either a short-term rating from S&P or Moody's shall be deemed to
have the required rating set forth above if such Rating Agency confirms in
writing that such Person, if its short-term debt obligations were rated, would
be assigned such required rating.
"Eligible Franchisee" means, with respect to a Lessee, a
Franchisee (all of whose rental offices are located in the United States) which
meets the normal credit and other approval criteria of such Lessee, as
applicable, and which may be an affiliate of such Lessee.
"Eligible Manufacturer" means, with respect to Program
Vehicles, Chrysler, and Ford and Toyota and with respect to Non-Program
Vehicles, Chrysler, General Motors, Ford, Honda, Mazda, Nissan and Toyota, and,
in each case, any other Manufacturer that (a) has an Eligible Vehicle
Disposition Program that has been reviewed by the Rating Agencies and the
Rating Agencies have indicated that the inclusion of such Manufacturer's
Vehicles under the Master Lease will not adversely affect the then current
rating of any Group II Series of Notes, and (b) has been approved by each
Enhancement Provider, if any; provided, however, that upon the occurrence of a
Manufacturer Event of Default with respect to such Manufacturer, such
Manufacturer shall no longer qualify as an Eligible Manufacturer.
"Eligible Receivable" means a legal, valid and binding
receivable (a) due from any Eligible Manufacturer under a Eligible Vehicle
Disposition Program to RCFC, a Lessee, an Additional Lessee or a creditor of
RCFC or such Lessee or Additional Lessee, (b) in respect of a Program Vehicle
purchased by such Eligible Manufacturer, which absent such purchase, would have
constituted an Eligible Vehicle with respect to which either (i) the Lien of
the Master Collateral Agent was noted on the Certificate of Title at the time
of purchase or (ii) such Vehicle is in the Existing Fleet of a Lessee seeking
to refinance such receivable, and (c) the right to
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payments in respect of which has been assigned by the payee thereof to the
Master Collateral Agent for the benefit of the Secured Parties; provided that
no amount receivable from an Eligible Manufacturer or auction dealer under a
Eligible Vehicle Disposition Program shall be an Eligible Receivable if such
amount remains unpaid more than ten (10) days after the Vehicle Disposition
Program Payment Due Date in respect of such Vehicle.
"Eligible Vehicle" means, on any date of determination, a
Group II Vehicle manufactured by an Eligible Manufacturer (determined at the
time of the acquisition, financing or refinancing thereof) and satisfying any
further eligibility requirements specified by the Rating Agencies or in any
Group II Series Supplement (other than with respect to the Maximum Non-Program
Percentage and the Maximum Manufacturer Percentage), or with respect to which
all such eligibility requirements not otherwise satisfied have been duly waived
by the Required Noteholders in accordance with the terms of the applicable
Series Supplement (if such waiver is permitted thereby); provided, however,
that in no event may a Group II Vehicle be an Eligible Vehicle after (x) in the
case of a Program Vehicle, the expiration of the applicable Maximum Term
(unless such Vehicle has been designated as a Non-Program Vehicle pursuant to
Section 14 of the Master Lease), or (y) the date which is twenty four (24)
months after the date of the original new vehicle dealer invoice for such
Vehicle or if such invoice date is unavailable, the age of the vehicle (in
months) will be determined by dividing the Vehicle's odometer reading by 1500.
"Enhancement Agent" means Bankers Trust Company, a New York
banking corporation, or its permitted successors and assigns under Section 4.19
hereof.
"Enhancement Amount" means the sum of (a) the Series 1998-1
Available Subordinated Amount, plus (b) the Series 1998-1 Letter of Credit
Amount.
"Excess Cash Flow" means, for any Fiscal Year of DTAG, an
amount equal to the excess of (a) the sum, without duplication, of (i) EBITDA
for such Fiscal Year and (ii) decreases in Consolidated Working Capital for
such Fiscal Year over (b) the sum, without duplication, of (i) the aggregate
amount paid by DTAG and its Subsidiaries in cash during such Fiscal Year on
account of taxes computed on the basis of income, (ii) the portion of Aggregate
Interest Expense for such Fiscal Year paid by DTAG and its Subsidiaries in
cash during such Fiscal Year, (iii) the aggregate amount paid by DTAG and its
Subsidiaries in cash during such Fiscal Year on account of Capital Expenditures
(excluding the principal amount of Indebtedness incurred in connection with
such Capital Expenditures, whether incurred in such Fiscal Year or in a
subsequent Fiscal Year), (iv) the aggregate amount of all prepayments of any
amounts outstanding under any revolving credit facility or agreement to which
DTAG or any of its Subsidiaries is a borrower to the extent accompanied by
permanent reductions of the commitments to extend credit thereunder, (v) the
aggregate amount of all principal payments of Indebtedness of DTAG or its
Subsidiaries (including any term loans and the principal component of payments
in respect of capitalized lease liabilities) made during such Fiscal Year
(other than in respect of any revolving credit facility or agreement to the
extent there is not an equivalent permanent reduction in commitments to extend
credit thereunder), (vi) increases in Consolidated Working Capital for such
Fiscal Year, (vii) the
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amount of cash payments by DTAG and its Subsidiaries during such Fiscal Year in
respect of long-term liabilities of DTAG and its Subsidiaries other than
Indebtedness, (viii) the amount of Investments made during such Fiscal Year in
cash to the extent that such Investments were financed with internally
generated cash flow of DTAG and its Subsidiaries, (ix) the amount of
Distributions made during such Fiscal Year by DTAG in cash and (x) the
aggregate amount of expenditures made by DTAG and its Subsidiaries in cash
during such Fiscal Year (including expenditures for the payment of financing
fees) to the extent that such expenditures are not expensed during such Fiscal
Year.
"Excess Damage Charges" means, with respect to any Program
Vehicle, the amount charged to RCFC (or the applicable Lessee), or deducted
from the Repurchase Payment or Guaranteed Payment, by the Manufacturer of such
Vehicle due to damage over a prescribed limit to the Vehicle at the time that
the Vehicle is disposed of at Auction or turned in to such Manufacturer or its
agent for repurchase, in either case pursuant to the applicable Vehicle
Disposition Program.
"Excess Funding Accounts" means, collectively, as of any date,
the Series 1998-1 Excess Funding Account and the corresponding account or
accounts designated as such with respect to each additional Group II Series of
Notes as of such date.
"Excess Mileage Charges" means, with respect to any Program
Vehicle, the amount charged to RCFC (or the applicable Lessee), or deducted
from the Repurchase Payment or Guaranteed Payment, by the Manufacturer of such
Vehicle due to the fact that such Vehicle has mileage over a prescribed limit
at the time that such Vehicle is disposed of at Auction or turned in to such
Manufacturer or its agent for repurchase, in either case pursuant to the
applicable Vehicle Disposition Program.
"Existing Fleet" means with respect to Vehicles leased under
the Master Lease, the Eligible Vehicles owned by and titled in the name of
Dollar or Thrifty on the Lease Commencement Date and refinanced by RCFC under
the Master Lease pursuant to the initial Vehicle Order of Dollar or Thrifty, as
applicable.
"Financed Vehicle" means an Eligible Vehicle that is financed
by RCFC and leased to a Lessee under Annex B to the Master Lease on or after
the Lease Commencement Date.
"Financing Lease" means the Master Lease supplemented by Annex
B to the Master Lease.
"Financing Sources" has the meaning specified in the Master
Collateral Agency Agreement.
"Fiscal Quarter" means any quarter of a Fiscal Year.
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"Fiscal Year" means any period of twelve consecutive calendar
months ending on December 31 (or such other date with respect to which each of
the Trustee and the Liquidity Agent has provided its prior written consent
(which consent shall not be unreasonably withheld, but which consent may be
conditioned upon the effectuation of such amendments and other modifications to
this Supplement, the other Related Documents and the CP Program Documents as
each of the Trustee and the Liquidity Agent may reasonably request));
references to a Fiscal Year with a number corresponding to any calendar year
(e.g., the "1998 Fiscal Year") refer to the Fiscal Year ending on the December
31 (or such other date with respect to which each of the Trustee and the
Liquidity Agent has provided its prior written consent (which consent shall not
be unreasonably withheld, but which consent may be conditioned upon the
effectuation of such amendments and other modifications to this Supplement, the
other Related Documents and the CP Program Documents as each of the Trustee and
the Liquidity Agent may reasonably request)) occurring during such calendar
year.
"Fixed Charge Coverage Ratio" means, at the end of any Fiscal
Quarter, the ratio of
(a) the sum of (i) Adjusted EBITDA for the four consecutive
Fiscal Quarters ending on the last day of such Fiscal Quarter plus
(ii) rental expense of DTAG and its Subsidiaries during such period
under all leases of real property exclusive of any portion of such
expense determined on the basis of the revenues generated by the
operations conducted on the real property subject to such leases
("Rental Expense")
to
(b) the sum of (i) Non-Vehicle Interest Expense for the four
consecutive Fiscal Quarters ending on the last day of such Fiscal
Quarter (subject to the proviso set forth in clause (a) of the
definition of "Non- Vehicle Interest Expense"), plus (ii) taxes
computed on the basis of income and paid in cash during such period
(net of cash received during such period in respect of such taxes),
plus (iii) scheduled repayments of principal made by DTAG and its
Subsidiaries during such period of Indebtedness (other than Vehicle
Debt) of the type described in clause (a), (c), (f) or (g) of the
definition of "Indebtedness" or, to the extent in respect of such type
of Indebtedness, clause (h) of the definition of "Indebtedness," plus
(iv) Capital Expenditures made by DTAG and its Subsidiaries during
such period in cash (excluding Capital Expenditures for the
acquisition of Vehicles), plus (v) Rental Expense during such period,
plus (vi) Distributions made by DTAG during such period.
"Ford" means Ford Motor Company, a Delaware corporation.
"Franchisee" means a franchisee of a Lessee.
"General Motors" means General Motors Corporation, a Delaware
corporation.
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"Group II Aggregate Invested Amount" means the sum of the
Invested Amounts with respect to all Group II Series of Notes then outstanding.
"Group II Collateral" means the Master Lease and all payments
made thereunder, the Group II Vehicles, the rights under Vehicle Disposition
Programs in respect of Group II Vehicles, any other Master Collateral related
to Group II Vehicles, the Group II Collection Account and all proceeds of the
foregoing.
"Group II Collection Account" will have the meaning set forth
therefor in Section 4.6(a) hereof.
"Group II Monthly Servicing Fee" means, on any date of
determination, 1/12 of 1% of the Group II Aggregate Invested Amount as of the
preceding Payment Date, after giving effect to any payments or allocations made
on such date; provided, however, that if a Rapid Amortization Period shall
occur and be continuing with respect to any Group II Series of Notes and if
DTAG is no longer the Master Servicer, the Group II Monthly Servicing Fee shall
equal the greater of (x) the product of (i) $20 and (ii) the number of Group II
Vehicles as of the last day of the Related Month, and (y) the amount described
in the first clause of this definition.
"Group II Series of Notes" has the meaning specified in
Section 1(c) hereof.
"Group II Supplemental Servicing Fee" is defined in Section
26.1 of the Master Lease.
"Group II Vehicle" means, as of any date, a passenger
automobile or truck leased by RCFC to a Lessee under the Master Lease as of
such date and pledged by RCFC under the Master Collateral Agency Agreement for
the benefit of the Trustee (on behalf of the Noteholders), but solely during
the Vehicle Term for such Vehicle.
"Hedging Agreements" means, collectively, currency exchange
agreements, interest rate swap agreements, interest rate cap agreements and
interest rate collar agreements, and all other agreements or arrangements
designed to protect a Person against fluctuations in interest rates or currency
exchange rates.
"Hedging Obligations" means, with respect to any Person, all
liabilities of such Person under Hedging Agreements.
"Honda" means Honda Motor Company.
"Increase" has the meaning specified in Section 4A.2(a) of
this Supplement.
"Increase Date" means the date on which an Increase occurs.
"Indebtedness" of any Person means, without duplication:
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(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments;
(b) all obligations, contingent or otherwise, relative to the
face amount of all letters of credit, bonds (including Surety Bonds)
and similar obligations, whether or not drawn, and banker's
acceptances issued for the account of such Person;
(c) all obligations of such Person as lessee under leases
which have been or should be, in accordance with GAAP, recorded as
Capitalized Lease Liabilities;
(d) all obligations of such Person in the nature of
overdrafts;
(e) net liabilities of such Person under all Hedging
Obligations;
(f) whether or not so included as liabilities in accordance
with GAAP, all obligations of such Person to pay the deferred purchase
price of property or services (excluding open accounts extended by
suppliers on normal trade terms in connection with purchases of goods
and services), and indebtedness (excluding prepaid interest thereon)
secured by a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have
been assumed by such Person or is limited in recourse;
(g) Redeemable Capital Stock; and
(h) all Contingent Obligations of such Person in respect of
any of the foregoing.
For all purposes of this Supplement, the Indebtedness of any Person shall
include the Indebtedness of any partnership or joint venture in which such
Person is a general partner or a joint venturer, except to the extent the terms
of such Indebtedness provide that such Person is not liable therefor.
"Indemnified Persons" is defined in Section 15.1 of the Master
Lease.
"Initial Acquisition Cost" is defined in Section 2.3 of the
Master Lease.
"Interest Coverage Ratio" means, at the end of any Fiscal
Quarter, the ratio of
(a) EBITDA for the four consecutive Fiscal Quarters ending on
the last day of such Fiscal Quarter
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to
(b) Aggregate Interest Expense for the four consecutive Fiscal
Quarters ending on the last day of such Fiscal Quarter (subject to the
proviso set forth in clause (a) of the definition of "Non-Vehicle
Interest Expense"), net of interest income for such four Fiscal
Quarter period.
"Interest Reset Date" means the first day of the applicable
Series 1998-1 Interest Period.
"Investment" means, relative to any Person,
(a) any loan or advance made by such Person to any other
Person (excluding commission, travel and similar advances to officers
and employees made in the ordinary course of business);
(b) any Contingent Obligation of such Person; and
(c) any ownership or similar interest held by such Person in
any other Person.
The amount of any Investment shall be the original principal or capital amount
thereof less all returns of principal or equity thereon (and without adjustment
by reason of the financial condition of such other Person) and shall, if made
by the transfer or exchange of property other than cash, be deemed to have been
made in an original principal or capital amount equal to the fair market value
of such property.
"Issuer" has the meaning specified in the preamble hereto.
"Invested Amount" means, with respect to the Series 1998-1
Notes, the Series 1998-1 Invested Amount, and with respect to each other Series
of Notes, the amount specified in the applicable Supplement.
"Late Return Payments" is defined in Section 13 of the Master
Lease.
"Lease Annex" means Annex A or Annex B to the Master Lease, as
applicable, as such annex may be amended, supplemented, restated or otherwise
modified from time to time in accordance with the terms of the Master Lease.
"Lease Commencement Date" has the meaning specified in Section
3.2 of the Master Lease.
"Lease Event of Default" is defined in Section 17.1 of the
Master Lease.
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"Lease Expiration Date" is defined in Section 3.2 of the
Master Lease.
"Lease Payment Losses" means as of any Payment Date, the
amount of payments due under the Master Lease with respect to the Related Month
which were not paid when due.
"Lease Payment Recoveries" means, as of any Determination
Date, an amount equal to all payments made under the Master Lease since the
preceding Determination Date on account of past due payments under the Master
Lease.
"Lessee" means either Thrifty or Dollar, in its capacity as a
Lessee under the Master Lease, any Additional Lessee, or any successor by
merger to Thrifty, Dollar or any Additional Lessee, in accordance with Section
25.1 of the Master Lease, or any other permitted successor or assignee of
Thrifty or Dollar, as applicable, in its capacity as Lessee, or of any
Additional Lessee, pursuant to Section 16 of the Master Lease.
"Lessee Agreements" means any and all Subleases entered into
by any of the Lessees the subject of which includes any Vehicle leased by the
Lessor to such Lessee under the Master Lease, and any and all other contracts,
agreements, guarantees, insurance, warranties, instruments or certificates
entered into or delivered to such Lessee in connection therewith.
"Lessor" means RCFC, in its capacity as the lessor under the
Master Lease, and its successors and assigns in such capacity.
"Limited Guarantee and Reimbursement Agreement" means that
certain Limited Guarantee and Reimbursement Agreement, dated as of December 23,
1997, among Chrysler, the Master Collateral Agent, DTAG, Dollar and Thrifty, as
the same may be amended, restated, supplemented or otherwise modified from time
to time in accordance with the terms thereof.
"Limited Liquidation Event of Default" means, so long as such
event or condition continues, any event or condition of the type specified in
(a) Section 5.1(a) of this Supplement that continues for thirty (30) days
(without double counting the five (5) Business Day cure period provided for in
said Section 5.1(a)); provided, however, that such event or condition shall not
constitute a Limited Liquidation Event of Default if (i) within such thirty
(30) day period, RCFC shall have contributed a portion of the Retained Interest
to the Series 1998-1 Available Subordinated Amount sufficient to cure the
Series 1998-1 Enhancement Deficiency and (ii) the Rating Agency shall have
notified RCFC and the Trustee in writing that after such cure of such Series
1998-1 Enhancement Deficiency is provided for, the Series 1998-1 Notes or the
Commercial Paper Notes will each receive the same rating from the Rating Agency
as they received prior to the occurrence of such Series 1998-1 Enhancement
Deficiency, or (b) Section 5.1(b),(c) or (f) of this Supplement.
"Liquidation Event of Default" means, so long as such event or
condition continues, any of the following: (a) any event or condition with
respect to RCFC or a Lessee of
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the type described in Section 8.1(d) of the Base Indenture, (b) a payment
default by RCFC under the Base Indenture as specified in Sections 8.1(a) and
8.1(b) thereof, or (c) a Lease Event of Default as specified in Section 8.1(e)
thereof (with respect solely to the occurrence of the Lease Events of Default
described in Sections 17.1.1(i), 17.1.2 and 17.1.5 under the Master Lease).
"Liquidity Agent" means Credit Suisse First Boston, a Swiss
banking corporation, in its capacity as the Liquidity Agent under the Liquidity
Agreement, and its successors and assigns in such capacity.
"Liquidity Agreement" means the Liquidity Agreement, dated as
of March 4, 1998, among DTFC, certain financial institutions party thereto as
liquidity lenders and the Liquidity Agent.
"Liquidity Deficiency" is defined in the Certificate of
Liquidity Demand attached as Annex B to the Series 1998-1 Letter of Credit.
"Liquidity Demand" means a demand for a LOC Liquidity
Disbursement under the Series 1998-1 Letter of Credit pursuant to a Certificate
of Liquidity Demand.
"LOC Credit Disbursement" means an amount drawn under the
Series 1998-1 Letter of Credit pursuant to a Certificate of Credit Demand.
"LOC Disbursement" shall mean any LOC Liquidity Disbursement,
any LOC Credit Disbursement or any LOC Termination Disbursement, or other
disbursement by the Series 1998-1 Letter of Credit Provider under the Series
1998-1 Letter of Credit, or any combination thereof, as the context may
require.
"LOC Liquidity Disbursement" means an amount drawn under the
Series 1998-1 Letter of Credit pursuant to a Certificate of Liquidity Demand.
"LOC Termination Disbursement" means an amount drawn under the
Series 1998-1 Letter of Credit pursuant to a Certificate of Termination Demand.
The amount of such LOC Termination Disbursement shall be the amount so drawn or
thereafter, if greater, the amount of the Deposited Funds in the Series 1998-1
Cash Collateral Account.
"Losses" means, with respect to any Related Month, the sum
(without duplication) of the following: with respect to Acquired Vehicles (i)
all Manufacturer Late Payment Losses for such Related Month, plus (ii) with
respect to Disposition Proceeds received during the Related Month from the sale
or other disposition of Acquired Vehicles (other than pursuant to a Vehicle
Disposition Program), the excess, if any, of (x) the Net Book Values of such
Acquired Vehicles calculated on the dates of the respective sales or final
dispositions thereof, over (y) (1) the aggregate amount of such Disposition
Proceeds received during the Related Month in respect of Acquired Vehicles by
RCFC, the Master Collateral Agent or the Trustee (including by deposit
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into the Collection Account or the Master Collateral Account) plus (2) any
Termination Payments that have accrued with respect to such Acquired Vehicles.
"Mandatory Decrease" has the meaning specified in Section
4A.3(a) of this Supplement.
"Manufacturer Event of Default" is defined in Section 18 of
the Master Lease.
"Manufacturer Event of Default Losses" means, with respect to
any Related Month, in the event that a Manufacturer Event of Default occurs
with respect to any Manufacturer, all payments that are required to be made
(and not yet made) by such Manufacturer to RCFC with respect to Acquired
Vehicles that are either (i) sold at Auction or returned to such Manufacturer
under such Manufacturer's Vehicle Disposition Program, or (ii) subject to an
incentive program of such Manufacturer; provided that the grace or other
similar period for the determination of such Manufacturer Event of Default
expires during such Related Month.
"Manufacturer Late Payment Losses" with respect to any Related
Month, means all payments required to be made by Manufacturers under such
Manufacturers' Vehicle Disposition Programs and incentive programs with respect
to Program Vehicles, which are not made within one hundred (100) days after the
related Due Dates of such Program Vehicles as of the end of such Related Month,
but only to the extent that such 100 day periods expire during such Related
Month; provided that any payments considered hereunder shall be net of amounts
that are the subject of a good faith dispute as evidenced in writing by the
Manufacturer questioning the accuracy of the amounts paid or payable in respect
of any such Acquired Vehicles.
"Manufacturer Receivable" means an amount due from a
Manufacturer or auction dealer under a Vehicle Disposition Program in respect
of or in connection with a Program Vehicle being turned back to such
Manufacturer.
"Market Value" means, with respect to any Non-Program Vehicle
as of any date of determination, the market value of such Non-Program Vehicle's
model class and model year as specified in the Related Month's published
National Automobile Dealers Association, Official Used Car Guide, Central
Edition (the "NADA Guide") for the model class and model year of such Vehicle
based on the average equipment and the average mileage of each Vehicle of such
model class and model year. If such Non-Program Vehicle's model class and
model year are not listed in the NADA Guide published in the Related Month
preceding such date of determination, then the Black Book Official
Finance/Lease Guide (the "Lease Guide") shall be used to estimate the wholesale
price of the Non-Program Vehicle, based on the Non-Program Vehicle's model
class and model year or the closest model class and model year thereto (if
appropriate as determined by the applicable Servicer), for purposes of such
months for which the wholesale price for such Vehicle's model class and model
year is not so published in the NADA Guide;
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provided, however, if the NADA Guide was not published in the Related Month,
then the Lease Guide shall be relied upon in its place, and if the Lease Guide
is unavailable, the Market Value of such Vehicle shall be based upon such other
reasonable methodology as determined by the Issuer.
"Market Value Adjustment Percentage" means, as of any date on
or after the third Determination Date following the Series 1998-1 Closing Date,
the lower of (i) the lowest Measurement Month Average of any full Measurement
Month within the preceding 12 calendar months and (ii) a fraction expressed as
a percentage, the numerator of which equals the average of the aggregate Market
Value of Non-Program Vehicles leased under the Master Lease as of the last day
of the Related Month and as of the last day of the two Related Months precedent
thereto and the denominator of which equals the average of the aggregate Net
Book Values of such Non-Program Vehicles calculated as of such dates.
"Master Collateral Agency Agreement" means the Amended and
Restated Master Collateral Agency Agreement, dated as of December 23, 1997,
among DTAG, as Master Servicer, RCFC, as grantor, Thrifty and Dollar, as
grantors and servicers, such other grantors as may become parties thereto,
various Financing Sources parties thereto, various Beneficiaries parties
thereto and the Master Collateral Agent, as such agreement may be amended,
supplemented, restated or otherwise modified from time to time in accordance
with its terms.
"Master Collateral Agent" means Bankers Trust Company, a New
York banking corporation, in its capacity as master collateral agent under the
Master Collateral Agency Agreement, unless a successor Person shall have become
the master collateral agent pursuant to the applicable provisions of the Master
Collateral Agency Agreement, and thereafter "Master Collateral Agent" shall
mean such successor Person.
"Master Lease" means that certain Master Motor Vehicle Lease
and Servicing Agreement, dated as of March 4, 1998, among RCFC, as Lessor,
Thrifty, as a Lessee and Servicer, Dollar, as a Lessee and Servicer, those
additional Subsidiaries and Affiliates of DTAG from time to time becoming
Lessees and Servicers thereunder and DTAG, as guarantor and Master Servicer, as
the same may be amended, supplemented, restated or otherwise modified from time
to time in accordance with its terms.
"Master Lease Collateral" has the meaning set forth in Section
2.1(a) of this Supplement.
"Master Servicer" means DTAG, in its capacity as the Master
Servicer under the Master Lease, and its successors and assigns in such
capacity in accordance with the terms of the Master Lease.
"Material Adverse Effect" means, with respect to any
occurrence, event or condition, and any Person, a material adverse effect with
respect to:
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(a) the business, financial condition, operations or assets
of such Person;
(b) the ability of the such Person to perform its obligations
under the Master Lease or any other Related Document;
(c) the validity, enforceability or collectibility of amounts
payable to the Master Collateral Agent, the Trustee or the Lessor under the
Master Lease or the other Related Documents;
(d) the status, existence, perfection or first priority of
the interests of the Master Collateral Agent and the Trustee, as applicable, in
a material portion of the Master Collateral or the Collateral, free of any
Liens (other than Permitted Liens);
(e) the ability of the Master Collateral Agent, the Trustee
or the Lessor to liquidate or foreclose against the Collateral and the Master
Collateral; or
(f) the practical realization by the Master Collateral Agent,
the Trustee or the Lessor of any of the material benefits or security afforded
by the Master Lease or any other Related Document.
"Maximum Lease Commitment" means, on any date of
determination, the sum of (i) the maximum face amount on such date for all
Group II Series of Notes, plus (ii) with respect to all Group II Series of
Notes that provide for Enhancement in the form of overcollateralization, the
sum of the available subordinated amounts on such date for each such Group II
Series of Notes, plus (iii) the aggregate Net Book Values of all Group II
Vehicles leased under the Master Lease on such date that were acquired,
financed or refinanced with funds other than proceeds of Group II Series of
Notes or related available subordinated amounts, plus (iv) any amounts held in
the Retained Distribution Account that the Lessor commits on or prior such date
to invest in new Group II Vehicles for leasing under the Master Lease (as
evidenced by a Company Order) in accordance with the terms of the Master Lease
and the Indenture.
"Maximum Manufacturer Percentage" means, with respect to any
Eligible Manufacturer, the percentage amount set forth in Schedule 1 hereto (as
such schedule, subject to Rating Agency confirmation, may be amended,
supplemented, restated or otherwise modified from time to time) specified for
each Eligible Manufacturer with respect to Non-Program Vehicles and Program
Vehicles, as applicable, which percentage amount represents the maximum
percentage of Eligible Vehicles which are permitted under the Master Lease to
be Non-Program Vehicles or Program Vehicles, as the case may be, manufactured
by such Manufacturer.
"Maximum Non-Program Percentage" means, with respect to
Non-Program Vehicles, (a) if the average of the Measurement Month Averages for
any three Measurement Months during the twelve month period preceding any date
of determination shall be less than
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eighty-five percent (85%), 0% or such other percentage amount agreed upon by
the Lessor and each of the Lessees, subject to Rating Agency confirmation,
which percentage amount represents the maximum percentage of the Aggregate
Asset Amount which is permitted under the Master Lease to be invested in
Non-Program Vehicles; and (b) at all other times, 20%.
"Mazda" means Mazda Motor of America, Inc., a California
corporation.
"Measurement Month" with respect to any date, means, each
calendar month, or the smallest number of consecutive calendar months,
preceding such date in which (a) at least 500 Non-Program Vehicles were sold at
auction or otherwise and (b) at least one-twelfth of the aggregate Net Book
Value of the Non-Program Vehicles as of the last day of such calendar month or
consecutive calendar months were sold at auction or otherwise; provided that no
calendar month included in a Measurement Month shall be included in any other
Measurement Month.
"Measurement Month Average" means, with respect to any
Measurement Month, the percentage equivalent of a fraction, the numerator of
which is the aggregate amount of Disposition Proceeds of all Non-Program
Vehicles sold at auction or otherwise during such Measurement Month and the
denominator of which is the aggregate Net Book Value of such Non-Program
Vehicles on the dates of their respective sales.
"Minimum Enhancement Amount" means, with respect to the Series
1998-1 Notes on any date of determination, the sum of (a) the product of (i)
the Series 1998-1 Program Enhancement Percentage, times (ii) an amount in U.S.
Dollars equal to the aggregate Series 1998-1 Invested Amount minus the product
of (A) the aggregate amount of cash and Permitted Investments in the Group II
Collection Account and, to the extent cash and Permitted Investments in the
Master Collateral Account are allocable to the Trustee on behalf of the holders
of the Group II Series of Notes as Beneficiary pursuant to the Master
Collateral Agency Agreement and are not distributable to or at the direction of
DTAG, the Issuer, Thrifty or Dollar pursuant thereto, such cash and Permitted
Investments in the Master Collateral Account as of such date, in each case to
the extent such cash and Permitted Investments constitute Group II Collateral,
times (B) a fraction, the numerator of which shall be the sum of the Series
1998-1 Invested Amounts as of such date and the Series 1998-1 Available
Subordinated Amount for such date and the denominator of which shall be the
greater of (I) the Aggregate Asset Amount as of such date and (II) the sum of
the Invested Amounts for all Group II Series of Notes as of such date, times
(iii) a fraction, the numerator of which shall be the aggregate Net Book Value
of all Program Vehicles as of such date and the denominator of which shall be
the aggregate Net Book Value of all Program Vehicles and Non- Program Vehicles
as of such date, plus (b) the product of (i) the Series 1998-1 Non-Program
Enhancement Percentage times (ii) an amount in U.S. Dollars equal to the
aggregate Series 1998-1 Invested Amount as of such date, minus the product of
(A) the aggregate amount of cash and Permitted Investments in the Group II
Collection Account as of such date and, to the extent cash and Permitted
Investments in the Master Collateral Account are allocable to the Trustee on
behalf of holders of Group II Series of Notes as Beneficiary pursuant
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to the Master Collateral Agency Agreement and are not distributable to or at
the direction of the Master Servicer pursuant thereto, such cash and Permitted
Investments in the Master Collateral Account as of such date in each case to
the extent such cash and Permitted Investments constitute Group I Collateral,
times (B) a fraction, the numerator of which shall be the sum of the Series
1998-1 Invested Amount as of such date and the Series 1998-1 Available
Subordinated Amount for such date and the denominator of which shall be the
greater of (I) the Aggregate Asset Amount as of such date and (II) the sum of
the Invested Amounts for all Group II Series of Notes as of such date, times
(iii) a fraction, the numerator of which shall be the aggregate Net Book Value
of all Non-Program Vehicles as of such date and the denominator of which shall
be the aggregate Net Book Value of all Program Vehicles and Non-Program
Vehicles as of such date, plus (c) the Additional Overcollateralization Amount
as of such date.
"Minimum Letter of Credit Amount" means, with respect to any
date of determination on and after the Series 1998-1 Closing Date, the greater
of (a) an amount equal to (i) 3 % of the Series 1998-1 Invested Amount of the
Series 1998-1 Notes outstanding on such date, less (ii) any cash on deposit in
the Series 1998-1 Cash Collateral Account on such date, (b) an amount equal to
(i) the Minimum Enhancement Amount on such date, minus (ii) the Series 1998-1
Available Subordinated Amount on such date and (c) $5,000,000; provided, that
upon the occurrence of a Liquidity Agreement Amortization Event, the Minimum
Letter of Credit Amount shall remain fixed at an amount equal to the Series
1998-1 Letter of Credit Amount as of such date.
"Minimum Subordinated Amount" means, with respect to any date
of determination, the greater of (a) 2.25% of the Series 1998-1 Invested Amount
on such date and (b) an amount equal to (i) the Minimum Enhancement Amount,
minus (ii) the Series 1998-1 Letter of Credit Amount.
"Monthly Base Rent is defined in paragraph 9 of Annex A and
paragraph 6 of Annex B to the Master Lease.
"Monthly Certificate" is defined in Section 24.4(b) of the
Master Lease.
"Monthly Finance Rent" is defined in paragraph 6 of Annex B to
the Master Lease.
"Monthly Servicing Fee" is defined in Section 26.1 of the
Master Lease.
"Monthly Supplemental Payment" is defined in paragraph 6 of
Annex B to the Master Lease.
"Monthly Variable Rent" is defined in paragraph 9 of Annex A
to the Master Lease.
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"Monthly Vehicle Statement" is defined in Section 24.4(f) of
the Master Lease.
"Moody's" means Moody's Investors Service, Inc.
"Net Income" means, for any applicable period, the aggregate
of all amounts which, in accordance with GAAP, would be included as net
earnings (or net loss) on a consolidated statement of operations of DTAG and
its Subsidiaries for such period.
"Nissan" means Nissan Motor Corporation U.S.A., a California
corporation.
"Non-Program Vehicle" means a Group II Vehicle that, when
acquired by RCFC, Thrifty or Dollar, as the case may be, from an Eligible
Manufacturer, or when so designated by the Master Servicer, in each case
subject to the limitations described herein, is not eligible for inclusion in
any Eligible Vehicle Disposition Program.
"Note Purchase Agreement" means the Note Purchase Agreement,
dated as of March 4, 1998, among RCFC, DTAG and DTFC, pursuant to which DTFC
agrees to purchase the Series 1998-1 Notes from RCFC, subject to the terms and
conditions set forth therein, or any successor agreement to such effect among
RCFC, DTAG and DTFC or its successor, in any case as such agreement may be
amended, restated, supplemented or otherwise modified from time to time in
accordance with the terms thereof.
"Note Purchaser" means DTFC, in its capacity as the Note
Purchaser under the Note Purchase Agreement, and any permitted successors and
assigns in such capacity.
"Non-Vehicle Debt" means
(a) Total Debt
minus
(b) to the extent included in such Total Debt, Vehicle Debt
plus
(c) any obligation of a Subsidiary Borrower or any Subsidiary
of such Subsidiary Borrower (other than RCFC or another SPC) with
respect to Vehicles owned by such Subsidiary Borrower or such
Subsidiary (i) which exceeds the excess of (x) the aggregate
Capitalized Cost (as defined in the Base Indenture) of such Vehicles
over (y) the greater of the sum of the aggregate Depreciation Charges
(as defined in the Base Indenture) accrued with respect to such
Vehicles and the difference between such aggregate Capitalized Cost
and the fair market value of such Vehicles and (ii) which has become
due and payable and remains unpaid as of the end of any calendar
month.
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<PAGE> 29
"Non-Vehicle Interest Expense" means, for any applicable
period, the excess of
(a) the aggregate consolidated gross interest expense of DTAG
and its Subsidiaries for such period, as determined in accordance with
GAAP ("Aggregate Interest Expense"), including (i) commitment fees
paid or owed with respect to the then unutilized portion of the
Commitment Amount (as defined in the Credit Agreement), (ii) all other
fees paid or owed with respect to the issuance or maintenance of
Contingent Obligations (including letters of credit), which, in
accordance with GAAP, would be included as interest expense, (iii) net
costs or benefits under Hedging Arrangements and (iv) the portion of
any payments made in respect of Capitalized Lease Liabilities of DTAG
and its Subsidiaries allocable to interest expense, but excluding the
amortization of debt issuance costs and other financing expenses
incurred in connection with the transactions contemplated by the
Credit Agreement as set forth in the fifth recital thereto (provided
that in the event such gross interest expense (or any component
thereof) is being determined (x) for the four consecutive Fiscal
Quarters ending on the last day of the first Fiscal Quarter of the
1998 Fiscal Year, gross interest expense (or the applicable component
thereof) for such period shall equal the gross interest expense (or
the applicable component thereof) for the first Fiscal Quarter of the
1998 Fiscal Year multiplied by 4.0, (y) for the four consecutive
Fiscal Quarters ending on the last day of the second Fiscal Quarter of
the 1998 Fiscal Year, gross interest expense (or the applicable
component thereof) for such period shall equal the gross interest
expense (or the applicable component thereof) for the two consecutive
Fiscal Quarters of the 1998 Fiscal Year ending on such last day
multiplied by 2.0 and (z) for the four consecutive Fiscal Quarters
ending on the last day of the third Fiscal Quarter of the 1998 Fiscal
Year, gross interest expense (or the applicable component thereof) for
such period shall equal the gross interest expense (or the applicable
component thereof) for the three consecutive Fiscal Quarters of the
1998 Fiscal Year ending on such last day multiplied by 1.33)
over
(b) to the extent included in the preceding clause (a), gross
interest expense in respect of Vehicle Debt ("Vehicle Interest
Expense").
"Officer's Certificate" means a certificate signed by an
Authorized Officer of DTAG, RCFC or a Lessee, as applicable.
"Operating Lease" means the Master Lease as supplemented by
Annex A to the Master Lease.
"Opinion of Counsel" means a written opinion from legal
counsel who is acceptable to the Trustee. The counsel may be an employee of or
counsel to DTAG, RCFC or a Lessee, as the case may be, unless the Required
Beneficiaries shall notify the Trustee of objection thereto.
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<PAGE> 30
"Overcollateralization Portion" means, as of any date of
determination, (i) the sum of the amounts determined pursuant to clauses(a) and
(b) of the definition of Minimum Enhancement Amount as of such date minus (ii)
the Series 1998-1 Letter of Credit Amount as of such date.
"Payment Date" means the 25th day of each calendar month, or,
if such day is not a Business Day, the next succeeding Business Day, commencing
April 25, 1998.
"Permitted Investments" means negotiable instruments or
securities maturing on or before the Payment Date next occurring after the
investment therein, represented by instruments in bearer, registered or
book-entry form which evidence (i) obligations the full and timely payment of
which are to be made by or is fully guaranteed by the United States of America;
(ii) demand deposits of, time deposits in, or certificates of deposit issued
by, any depositary institution or trust company incorporated under the laws of
the United States of America or any state thereof and subject to supervision
and examination by Federal or state banking or depositary institution
authorities; provided, however, that at the earlier of (x) the time of the
investment and (y) the time of the contractual commitment to invest therein,
the certificates of deposit or short-term deposits, if any, or long-term
unsecured debt obligations (other than such obligation whose rating is based on
collateral or on the credit of a Person other than such institution or trust
company) of such depositary institution or trust company shall have a credit
rating from Standard & Poor's Rating Services, a division of The McGraw-Hill
Companies, Inc. ("Standard & Poor's") of "A-1+" and from DCR of at least "D-1+"
(if rated by DCR), in the case of certificates of deposit or short-term
deposits, or a rating from Standard & Poor's of at least "AA" and from DCR of
at least "AA" (if rated by DCR), in the case of long-term unsecured debt
obligations; (iii) commercial paper having, at the earlier of (x) the time of
the investment and (y) the time of contractual commitment to invest therein, a
rating from Standard & Poor's of "A-1+" and from DCR of at least "D-1+" (if
rated by DCR); (iv) demand deposits or time deposits which are fully insured by
the Federal Deposit Insurance Company; (v) bankers' acceptances issued by any
depositary institution or trust company described in clause (ii) above; (vi)
investments in money market funds rated at least "AAm" by Standard & Poor's or
otherwise approved in writing by Standard & Poor's and rated at least "D-1+" by
DCR (if rated by DCR); (vii) Eurodollar time deposits having a credit rating
from Standard & Poor's of "A-1+" and from DCR of at least "D-1+" (if rated by
DCR); (viii) repurchase agreements involving any of the Permitted Investments
described in clauses (i) and (vii) and the certificates of deposit described in
clause (ii) which are entered into with a depository institution or trust
company, having a commercial paper or short-term certificate of deposit rating
of "A-1+" by Standard & Poor's and of at least "D-1+" from DCR (if rated by
DCR) or otherwise is approved as to collateralization by the Rating Agencies;
and (ix) any other instruments or securities, if the Rating Agencies confirm in
writing that such investment will not adversely affect any ratings with respect
to any series.
"Permitted Liens" is defined in Section 25.3 of the Master
Lease.
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<PAGE> 31
"Pool Factor" means, on any Determination Date, with respect
to the Series 1998-1 Notes, a number carried out to eight decimals representing
the ratio of the Series 1998-1 Invested Amount as of such date (determined
after taking into account any decreases in the Series 1998-1 Invested Amount
which will occur on the following Payment Date) to the Series 1998-1 Initial
Invested Amount.
"Power of Attorney" is defined in Section 9 of the Master
Lease.
"Principal Collections" means Collections other than Series
1998-1 Interest Collections, Recoveries and Lease Payment Recoveries.
"Profits" has the meaning specified in Section 4.7(c)(ii)(1)
of this Supplement.
"Program Vehicle" means any Group II Vehicle which at the time
of purchase or financing by RCFC or a Lessee, as the case may be, is eligible
under an Eligible Vehicle Disposition Program.
"Pro Rata Share" means, with respect to a Lessee or a
Servicer, the ratio (expressed as a percentage) of (i) the aggregate Net Book
Value of Vehicles leased by such Lessee or serviced by such Servicer, as
applicable, divided by (ii) the aggregate Net Book Value of all Vehicles leased
under the Master Lease.
"Qualified Institution" means a depositary institution or
trust company (which may include the Trustee) organized under the laws of the
United States of America or any one of the states thereof or the District of
Columbia; provided, however, that at all times such depositary institution or
trust company is a member of the FDIC and has (i) has a long-term indebtedness
rating from Standard & Poor's of not lower than "AA" and from DCR of not lower
than "AA" and a short-term indebtedness of rating from Standard & Poor's not
lower than "A-1+" and from DCR of not lower than "D-1+", or (ii) has such other
rating which has been approved by the Rating Agencies.
"Rating Agencies" means, with respect to the Commercial Paper
Notes, Standard & Poor's, Moody's and DCR.
"Rating Agency Condition" means, with respect to any action,
that each Rating Agency shall have notified DTFC, RCFC, DTAG, the Series 1998-1
Letter of Credit Provider and the Trustee in writing that such action will not
result in a reduction or withdrawal of the rating (in effect immediately before
the taking of such action) of the Commercial Paper Notes.
"RCFC" has the meaning set forth in the preamble.
"RCFC Agreements" has the meaning set forth in Section
2.1(a)(i) of this Supplement.
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<PAGE> 32
"RCFC Obligations" means all principal and interest, at any
time and from time to time, owing by RCFC on the Series 1998-1 Notes and all
costs, fees and expenses payable by, or obligations of, RCFC under the
Indenture and the Related Documents.
"Recoveries" means, with respect to any Related Month, the sum
(without duplication) of (i) all amounts received by RCFC, the Master
Collateral Agent or the Trustee (including by deposit into the Collection
Account or the Master Collateral Account) from any Person during such Related
Month in respect of Losses, plus (ii) the excess, if any, of (x) the aggregate
amount of Disposition Proceeds received during such Related Month by RCFC, the
Master Collateral Agent or the Trustee (including by deposit into the
Collection Account or the Master Collateral Account) and resulting from the
sale or other final disposition of Acquired Vehicles (other than pursuant to
Vehicle Disposition Programs) plus any Termination Payments that have accrued
with respect to such Acquired Vehicles, over (y) the Net Book Values of such
Acquired Vehicles, calculated on the dates of the respective sales or
dispositions thereof.
"Redeemable Capital Stock" means Capital Stock of DTAG or any
of its Subsidiaries that, either by its terms, by the terms of any security
into which it is convertible or exchangeable or otherwise, (i) is or upon the
happening of an event or passage of time would be required to be redeemed (for
consideration other than shares of common stock of DTAG) on or prior to
December 31, 2003, (ii) is redeemable at the option of the holder thereof (for
consideration other than shares of common stock of DTAG) at any time prior to
such date or (iii) is convertible into or exchangeable for debt securities of
DTAG or any of its Subsidiaries at any time prior to such anniversary.
"Refinanced Vehicles" has the meaning specified in Section 2.1
of the Master Lease.
"Refinancing Schedule" has the meaning specified in Section
2.1 of the Master Lease.
"Related Documents" means, collectively, the Indenture, the
Series 1998-1 Notes, any Enhancement Agreement, the Master Lease, the Master
Collateral Agency Agreement and any grantor supplements and financing source
and beneficiary supplements thereto involving the Trustee as Beneficiary, the
Chrysler Vehicle Lien Nominee Agreement, the Assignment Agreements, the Note
Purchase Agreement and the CP Program Documents, as defined in the Note
Purchase Agreement.
"Rent", with respect to each Acquired Vehicle and each
Financed Vehicle, is defined in paragraph 9 of Annex A to the Master Lease and
in paragraph 6 of Annex B to the Master Lease.
"Required Asset Amount" means with respect to the Series
1998-1 Notes, at any date of determination, the sum of (i) the Invested Amounts
for all Group II Series of Notes that
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<PAGE> 33
do not provide for Enhancement in the form of overcollateralization plus (ii)
with respect to all Group II Series of Notes that provide for Enhancement in
the form of overcollateralization, the sum of (a) the Invested Amounts for all
such Series of Notes, plus (b) the available subordinated amounts required to
be maintained as part of the minimum enhancement amount for all such Series of
Notes.
"Required Beneficiaries" means Noteholders holding in excess
of 50% of the aggregate Invested Amounts of all outstanding Group II Series of
Notes (excluding, for the purposes of making the foregoing calculation, any
notes known to be held by DTAG or any Affiliate of DTAG).
"Required Noteholders" means Noteholders holding in excess of
50% of the aggregate Invested Amount of the applicable Group II Series of Notes
(excluding, for the purposes of making the foregoing calculation, any Notes
held by DTAG or any Affiliate of DTAG).
"Responsible Officer" means, with respect to DTAG, RCFC,
Thrifty, Dollar or any Additional Lessee, any President, Vice President,
Assistant Vice President, Secretary, Assistant Secretary, Treasurer or
Assistant Treasurer, or any officer performing functions similar to those
customarily performed by the person who at the time shall be such officer.
"Retained Amount" means, on any date of determination, the
amount, if any, by which the Aggregate Asset Amount at the end of the day
immediately prior to such date of determination, exceeds the Required Asset
Amount at the end of such day.
"Retained Interest" means the transferable indirect interest
in RCFC's assets held by the Retained Interestholder to the extent relating to
the Group II Collateral, including the right to receive payments with respect
to such collateral in respect of the Retained Amount.
"Retained Interest Percentage" means, on any date of
determination, when used with respect to Group II Collections that are
Principal Collections, Recoveries, Lease Payment Recoveries, Losses, Lease
Payment Losses and other amounts, an amount equal to one hundred percent (100%)
minus the sum of (i) the invested percentages for all outstanding Group II
Series of Notes including all classes of such Series of Notes and (ii) the
available subordinated amount percentages for all Group II Series of Notes that
provide for credit enhancement in the form of overcollateralization, in each
case as such percentages are calculated on such date with respect to Group II
Collections that are Principal Collections, Recoveries, Lease Payment
Recoveries, Losses, Lease Payment Losses and other amounts, as applicable.
"Retained Interestholder" means DTAG as owner of all
outstanding capital stock of RCFC or any permitted successor or assign.
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<PAGE> 34
"Series 1998-1 Accrued Interest Account" has the meaning
specified in Section 4.6(b) of this Supplement.
"Series 1998-1 Available Subordinated Amount" means, for any
date of determination, an amount equal to (a) the Series 1998-1 Available
Subordinated Amount for the preceding Determination Date (or, in the case of
the initial Determination Date following the Series 1998-1 Closing Date, the
Series 1998-1 Closing Date), minus (b) the Series 1998-1 Available Subordinated
Amount Incremental Losses for the Related Month, plus (c) the Series 1998-1
Available Subordinated Amount Incremental Recoveries for the Related Month,
minus (d) the Series 1998-1 Lease Payment Losses allocable to the Series 1998-1
Available Subordinated Amount pursuant to Section 4.7 of this Supplement since
the preceding Determination Date, plus (e) the Series 1998-1 Lease Payment
Recoveries allocable to the Series 1998-1 Available Subordinated Amount
pursuant to Section 4.7 of this Supplement since the preceding Determination
Date, plus (f) additional amounts, if any, contributed by RCFC since the
preceding Determination Date (or in the case of the first Determination Date,
since the Series 1998-1 Closing Date) to the Series 1998-1 Excess Funding
Account for allocation to the Series 1998-1 Available Subordinated Amount, plus
(g) the aggregate Net Book Value of additional Eligible Vehicles contributed by
the Retained Interestholder since the preceding Determination Date (or in the
case of the first Determination Date, since the Series 1998-1 Closing Date) as
Master Collateral for allocation to the Series 1998-1 Available Subordinated
Amount pursuant to the Indenture, minus (h) any amounts withdrawn from the
Series 1998-1 Excess Funding Account since the preceding Determination Date (or
in the case of the first Determination Date, since the Series 1998-1 Closing
Date) for allocation to the Retained Distribution Account. The "Series 1998-1
Available Subordinated Amount" for the Series 1998-1 Closing Date through the
first Determination Date thereafter shall mean $0.
"Series 1998-1 Available Subordinated Amount Incremental
Losses" means, for any Related Month, the sum of all Losses that became Losses
during such Related Month and which were allocated to the Series 1998-1
Available Subordinated Amount pursuant to Section 4.7 of this Supplement.
"Series 1998-1 Available Subordinated Amount Incremental
Recoveries" means, for any Related Month, the sum of all Recoveries that became
Recoveries during such Related Month and which were allocated to the Series
1998-1 Available Subordinated Amount pursuant to Section 4.7 of this
Supplement.
"Series 1998-1 Available Subordinated Amount Maximum Increase"
means 1.1% of the sum of the Series 1998-1 Maximum Invested Amount and the
Series 1998-1 Available Subordinated Amount provided, however, that if (i) a
Series 1998-1 Enhancement Deficiency arises out of any Losses or Lease Payment
Losses and (ii) the Rating Agencies shall have notified RCFC, DTFC and the
Trustee in writing that, after cure of such Series 1998-1 Enhancement
Deficiency is provided for, the Series 1998-1 Notes and the Commercial Paper
Notes will each receive the same rating from the Rating Agencies as they
received immediately prior to the occurrence of such Series 1998-1 Enhancement
Deficiency, then the Series 1998-1 Available
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<PAGE> 35
Subordinated Amount Maximum Increase applicable to the cure of such Series
1998-1 Enhancement Deficiency shall not be limited in amount.
"Series 1998-1 Cash Collateral Account" has the meaning
specified in Section 4.16 of this Supplement.
"Series 1998-1 Cash Collateral Account Surplus" means, as of
any date of determination subsequent to the establishment and funding of the
Series 1998-1 Cash Collateral Account pursuant to Section 4.18(a) of this
Supplement, the amount, if any, by which (a) the Series 1998-1 Letter of Credit
Amount exceeds (b) the Minimum Letter of Credit Amount.
"Series 1998-1 Closing Date" means March 4, 1998.
"Series 1998-1 Collection Account" has the meaning specified
in Section 4.6(a) of this Supplement.
"Series 1998-1 Controlled Amortization Period" means the
period commencing on May 31, 2000 (or, if such day is not a Business Day, the
Business Day last preceding such day), and continuing to the earliest of (i)
the commencement of the Series 1998-1 Rapid Amortization Period, (ii) the date
on which the Series 1998-1 Notes are fully paid, (iii) the Series 1998-1
Termination Date, and (iv) the termination of the Indenture.
"Series 1998-1 Controlled Distribution Amount Deficiency" has
the meaning specified in Section 4.10(a)(i) of this Supplement.
"Series 1998-1 Deficiency Amount" has the meaning specified in
Section 4.8(a) of this Supplement.
"Series 1998-1 Deposit Date" has the meaning specified in
Section 4.7 of this Supplement.
"Series 1998-1 Distribution Account" has the meaning specified
in Section 4.12(a) of this Supplement.
"Series 1998-1 Distribution Account Collateral" has the
meaning specified in Section 4.12(d) of this Supplement.
"Series 1998-1 Enhancement Deficiency" means, with respect to
any date of determination, the amount, if any, by which the Enhancement Amount
is less than the Minimum Enhancement Amount for such day.
"Series 1998-1 Enhancement Factor" means, as of any date of
determination, an amount equal to (i) 100% minus (ii) the percentage equivalent
of a fraction, the numerator of which is the sum of the amounts determined
pursuant to clauses (a) and (b) of the definition of
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<PAGE> 36
Minimum Enhancement Amount as of such date and the denominator of which is the
Series 1998-1 Invested Amount as of such date.
"Series 1998-1 Excess Funding Account" has the meaning
specified in Section 4.6(a) of this Supplement.
"Series 1998-1 Expected Final Payment Date" means the March 4,
2001 Payment Date.
"Series 1998-1 Funding Date" means the date on which the
initial Increase is funded.
"Series 1998-1 Initial Invested Amount" means the aggregate
initial principal amount of the Series 1998-1 Notes, which is zero dollars.
"Series 1998-1 Interest Amount" means, with respect to any
Payment Date, the sum of the Daily Interest Amounts for each day in the related
Series 1998-1 Interest Period, plus all previously accrued and unpaid Series
1998-1 Interest Amounts (together with interest on such unpaid amounts at the
Series 1998-1 Note Rate), plus any Carrying Charges due to the Series 1998-1
Noteholders and unpaid as of such Payment Date.
"Series 1998-1 Interest Collections" means on any date of
determination, all Collections in the Collection Account which represent
Monthly Variable Rent, Monthly Finance Rent or the Availability Payment accrued
with respect to the Series 1998-1 Notes, plus the Series 1998-1 Invested
Percentage of any amounts earned on Permitted Investments in the Collection
Account which constitute Group II Collateral and which are available for
distribution on such date.
"Series 1998-1 Interest Period" means a period from and
including a Payment Date to but excluding the next succeeding Payment Date;
provided, however, that the initial Series 1998-1 Interest Period shall be from
the Series 1998-1 Closing Date to the initial Payment Date.
"Series 1998-1 Invested Amount" means, on any date of
determination, an amount equal to (a) the Series 1998-1 Initial Invested
Amount, minus (b) the amount of principal payments made to Series 1998-1
Noteholders and Decreases on or prior to such date, minus (c) all Losses and
Lease Payment Losses allocated to the Series 1998-1 Noteholders by allocation
to the Invested Amount on or prior to such date, plus (d) all Recoveries and
Lease Payment Recoveries allocated to the Series 1998-1 Noteholders by
allocation to the Invested Amount on or prior to such date, plus (e) all
Increases on or prior to such date.
"Series 1998-1 Invested Percentage" means, on any date of
determination:
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(i) when used with respect to Principal Collections, Losses,
Lease Payment Losses, Recoveries, Lease Payment Recoveries and other
amounts during the Series 1998-1 Revolving Period, the percentage
equivalent of a fraction, the numerator of which shall be an amount
equal to the sum of (x) the Series 1998-1 Invested Amount and (y) the
Series 1998-1 Available Subordinated Amount, in each case as of the
end of the second preceding Related Month or, until the end of the
second Related Month, as of the Series 1998-1 Closing Date, and the
denominator of which shall be the greater of (A) the Aggregate Asset
Amount as of the end of the second preceding Related Month or, until
the end of the second Related Month, as of the Series 1998-1 Closing
Date, and (B) as of the same date as in clause (A), the sum of the
numerators used to determine (i) invested percentages for allocations
with respect to Principal Collections (for all Group II Series of
Notes including all classes of such Series of Notes) and (ii)
available subordinated amount percentages for allocations with respect
to Principal Collections (for all Group II Series of Notes that
provide for credit enhancement in the form of overcollateralization);
and
(ii) when used with respect to Principal Collections, Losses,
Lease Payment Losses, Recoveries, Lease Payment Recoveries and other
amounts during the Series 1998-1 Controlled Amortization Period and
the Series 1998-1 Rapid Amortization Period, the percentage equivalent
of a fraction, the numerator of which shall be an amount equal to the
sum of (x) the Series 1998-1 Invested Amount and (y) the Series 1998-1
Available Subordinated Amount, in each case as of the end of the
related Series 1998-1 Revolving Period, and the denominator of which
shall be the greater of (A) the Aggregate Asset Amount as of the end
of the second preceding Related Month and (B) as of the same date as
in clause (A), the sum of the numerators used to determine (i)
invested percentages for allocations with respect to Principal
Collections (for all Group II Series of Notes including all classes of
such Series of Notes) and (ii) available subordinated amount
percentages for allocations with respect to Principal Collections (for
all Group II Series of Notes that provide for credit enhancement in
the form of overcollateralization).
"Series 1998-1 Investor Monthly Servicing Fee" means the
Series 1998-1 Invested Percentage of the Group II Monthly Servicing Fee.
"Series 1998-1 Lease Payment Losses" means, as of any
Determination Date and the Related Payment Date, an amount equal to the Series
1998-1 Invested Percentage of Lease Payment Losses as of such date.
"Series 1998-1 Lease Payment Recoveries" means, for any
Determination Date and the Related Payment Date, the Series 1998-1 Invested
Percentage of all Lease Payment Recoveries received during the Related Month.
"Series 1998-1 Letter of Credit" means the irrevocable letter
of credit, dated as of March 4, 1998, issued by the Series 1998-1 Letter of
Credit Provider in favor of the
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Enhancement Agent for the benefit of the Series 1998-1 Noteholders pursuant to
the CP Enhancement Letter of Credit Application and Agreement or any successor
or replacement letter of credit meeting the requirements of this Indenture and
the Master Lease.
"Series 1998-1 Letter of Credit Amount" means, as of any date
of determination, the amount (a) available to be drawn on such date under the
Series 1998-1 Letter of Credit, as specified therein or (b) if the Series
1998-1 Cash Collateral Account has been established and funded pursuant to
Section 4.18, the amount on deposit in the Series 1998-1 Cash Collateral
Account on such date.
"Series 1998-1 Letter of Credit Commitment" has the meaning
specified in the Series 1998-1 Letter of Credit.
"Series 1998-1 Letter of Credit Expiration Date" means the
date the Series 1998-1 Letter of Credit expires as specified in the Series
1998-1 Letter of Credit, as such date may be extended in accordance with the
terms of the Series 1998-1 Letter of Credit.
"Series 1998-1 Letter of Credit Provider" means Credit Suisse
First Boston, a Swiss banking corporation, or such other Person providing the
Series 1998-1 Letter of Credit in accordance with the terms of this Indenture
and the Master Lease.
"Series 1998-1 Limited Liquidation Event of Default" means, so
long as such event or condition continues, any event or condition of the type
specified in Section 5.1 of this Supplement that continues for thirty (30) days
(without double counting the five (5) Business Day cure period provided for in
said Section 5.1); provided, however, that such event or condition shall not
constitute a Series 1998-1 Limited Liquidation Event of Default if (i) within
such thirty (30) day period, DTAG shall have contributed a portion of the
Retained Interest or reallocated Eligible Vehicles from the Retained Interest
to the Series 1998-1 Available Subordinated Amount in accordance with Section
4.7(d)(v) sufficient to cure the Series 1998-1 Enhancement Deficiency and (ii)
the Rating Agencies shall have notified RCFC, DTAG and the Trustee in writing
that after such cure of such Series 1998-1 Enhancement Deficiency is provided
for, the Series 1998-1 Notes or the Commercial Paper Notes will each receive
the same rating from the Rating Agencies as they received prior to the
occurrence of such Series 1998-1 Enhancement Deficiency.
"Series 1998-1 Maximum Invested Amount" has the meaning
specified in Section 4A.1 of this Supplement.
"Series 1998-1 Monthly Interest Shortfall" means, as of any
Payment Date, the excess, if any, of the Series 1998-1 Interest Amount and any
Series 1998-1 Deficiency Amounts (together with accrued interest on such unpaid
Series 1998-1 Deficiency Amounts) over the amount withdrawn from the Series
1998-1 Accrued Interest Account and deposited in the Series
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1998-1 Distribution Account on such Payment Date pursuant to Section 4.7(a) of
this Supplement.
"Series 1998-1 Monthly Servicing Fee" means the Series 1998-1
Invested Percentage of the Group II Monthly Servicing Fee.
"Series 1998-1 Monthly Supplemental Servicing Fee" means the
Series 1998-1 Invested Percentage of the Group II Supplemental Servicing Fee.
"Series 1998-1 Non-Program Enhancement Percentage" means, with
respect to any date of determination, the greatest of (a) an amount equal to
(i) 100% minus (ii) an amount equal to (x) the Market Value Adjustment
Percentage, minus (y) 15%, and (b) 15%.
"Series 1998-1 Noteholder" means the Person in whose name a
Series 1998-1 Note is registered in the Note Register.
"Series 1998-1 Note Rate" means, for any Series 1998-1
Interest Period, the weighted average of the CP Rates for the portion of the
Series 1998-1 Invested Amount comprised of all or a portion of the CP Tranche
and the weighted average of the Eurodollar Rate applicable to the portion of
the Series 1998-1 Invested Amount comprised of all or a portion of the
Eurodollar Tranche and the weighted average of the Base Rates applicable to the
portion of the Series 1998-1 Invested Amount comprised of all or a portion of
the Base Rate Tranche, as such capitalized terms not otherwise defined herein
are defined in the Note Purchase Agreement; provided, however, that the Series
1998-1 Note Rate will in no event be higher than the maximum rate permitted by
applicable law. The Liquidity Agent will notify the Trustee and the Master
Servicer in writing regarding the Series 1998-1 Note Rate on or prior to the
related Determination Date pursuant to Section 4.4(b) of the Liquidity
Agreement.
"Series 1998-1 Notes" means any one of the Rental Car Asset
Backed Variable Funding Notes executed by RCFC and authenticated and delivered
by or on behalf of the Trustee, substantially in the form of Exhibit A.
"Series 1998-1 Principal Allocation" has the meaning specified
in Section 4.7(a)(i)(2) of this Supplement.
"Series 1998-1 Program Enhancement Percentage" means, with
respect to any date of determination, 9%.
"Series 1998-1 Rapid Amortization Period" means the period
beginning at the close of business on the Business Day immediately preceding
the day on which an Amortization Event is deemed to have occurred with respect
to the Series 1998-1 Notes and ending upon the earliest to occur of (i) the
date on which the Series 1998-1 Notes are paid in full, (ii) the Series 1998-1
Termination Date and (iii) the termination of the Indenture in accordance with
its terms.
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"Series 1998-1 Revolving Period" means, with respect to any
class of the Series 1998-1 Notes, the period from and including the Series
1998-1 Closing Date to the earlier of (i) the commencement of the Series 1998-1
Controlled Amortization Period related to such class of Notes and (ii) the
commencement (if any) of the Series 1998-1 Rapid Amortization Period.
"Series 1998-1 Termination Date" means, with respect to the
Series 1998-1 Notes, the March 4, 2001 Payment Date.
"Servicer" means Thrifty, Dollar or any Additional Lessee, as
applicable, in its capacity as a servicer under the Master Lease and any
successor servicer thereunder.
"Shared Principal Collections" means, as of any Payment Date,
Principal Collections allocable to a Group II Series of Notes as of such
Payment Date that are not required to make payments of principal with respect
to such Group II Series of Notes as of such Payment Date under the related
Series Supplement and are allocable in accordance with the terms of such Series
Supplement to make payments on other Group II Series of Notes.
"SPC" means RCFC, DTFC, Thrifty Trust, a trust organized under
the laws of Canada, each successor entity thereto, and any other special
purpose entity formed for the purpose of financing the acquisition of Vehicles.
"Sublease" means a standardized lease agreement, for the
leasing of Vehicles, between a Lessee, as lessor, and an Eligible Franchisee,
as lessee.
"Subsidiary Borrowers" means, collectively, Dollar and
Thrifty.
"Subsidiary Guarantor" means any Subsidiary of DTAG that is
party to a guaranty executed and delivered by such Subsidiary pursuant to
Section 6.1.11 of the Credit Agreement, substantially in the form of Exhibit G
to the Credit Agreement.
"Supplemental Documents" is defined in Section 2.1 of the
Master Lease.
"Surety Bond" means any instrument pursuant to which the
issuer thereof agrees to pay on behalf of DTAG or any of its Subsidiaries an
amount then due and payable by such DTAG or such Subsidiary to another Person
(including an insurer of such DTAG or such Subsidiary).
"Term" is defined in Section 3.2 of the Master Lease.
"Termination Demand" means a demand for a LOC Termination
Disbursement under the Series 1998-1 Letter of Credit pursuant to a Certificate
of Termination Demand.
"Termination Payment" is defined in Section 12.3 of the Master
Lease.
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"Texas Vehicles" means Eligible Vehicles acquired by RCFC on
or after the Lease Commencement Date for lease in the State of Texas under
Annex B of the Master Lease.
"Total Debt" means, without duplication, the aggregate amount
of all Indebtedness of DTAG and its Subsidiaries, other than Indebtedness of
the type described in clause (d) or (e) of the definition of "Indebtedness" or,
to the extent in respect of such type of Indebtedness, clause (h) of the
definition of "Indebtedness."
"Toyota" means Toyota Motor Sales, U.S.A., Inc., a California
corporation
"U.S. Dollar" means the lawful currency of the United States
of America.
"Vehicle Acquisition Schedule" is defined in Section 2.1 of
the Master Lease.
"Vehicle Debt" means Indebtedness relating solely to the
financing or leasing of any Vehicle and secured thereby (and by related
collateral); provided that any obligation included as Non-Vehicle Debt pursuant
to clause (c) of the definition thereof shall not be deemed to be Vehicle Debt.
"Vehicle Funding Date" is defined in Section 3.1 of the Master
Lease.
"Vehicle Interest Expense" is defined in clause (b) of the
definition of "Non-Vehicle Interest Expense".
"Vehicle Lease Commencement Date" is defined in Section 3.1 of
the Master Lease.
"Vehicle Lease Expiration Date", with respect to each Group II
Vehicle, means the earliest of (i) the Disposition Date for such Group II
Vehicle, (ii) if such Group II Vehicle becomes a Casualty, the date funds in
the amount of the Net Book Value thereof are received by the Lessor, the Master
Collateral Agent or the Trustee (including deposit into the Collection Account
or the Master Collateral Account) from any of the Lessees in accordance with
the Master Lease, and (iii) the Maximum Vehicle Lease Term of the Operating
Lease and the Financing Lease, as applicable, as specified in, respectively,
paragraph 5 of each of Annex A and Annex B to the Master Lease.
"Vehicle Disposition Program Payment Due Date" means, with
respect to any payment due from a Manufacturer or auction dealer in respect of
a Program Vehicle disposed of pursuant to the terms of the related Vehicle
Disposition Program, the thirtieth (30th) day after the Disposition Date for
such Vehicle.
"Vehicle Order" is defined in Section 2.1 of the Master Lease.
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"Vehicle Term" is defined in Section 3.1 of the Master Lease.
"VFR", for any Interest Period with respect to any Group II
Series of Notes, is an interest rate equal to the quotient, expressed as a
percentage, of (i) the amount of interest accrued during such Interest Period
with respect to all Group II Series of Notes, divided by (ii) the average daily
Aggregate Principal Balance of all such Group II Series of Notes during such
period.
"VIN" is defined in Section 18 of the Master Lease.
"Voluntary Decrease" is defined in Section 4A.3(b) of this
Supplement.
ARTICLE 3.
GRANT OF RIGHTS UNDER THE MASTER LEASE
Section 3.1 Grant of Security Interest.
(a) To secure the RCFC Obligations and to secure
compliance with the provisions of the Base Indenture and this Supplement, RCFC
hereby pledges, assigns, conveys, delivers, transfers and sets over to the
Trustee, for the benefit of the Group II Noteholders, and hereby grants to the
Trustee, for the benefit of the Group II Noteholders, a security interest in
all of RCFC's right, title and interest in and to all of the following assets,
property and interest in property of RCFC, whether now owned or hereafter
acquired or created, as it relates to the Master Lease, as that term is defined
in this Supplement (all of the foregoing being referred to as the "Master Lease
Collateral"):
(i) the rights of RCFC under the Master Lease and any other
agreements relating to the Vehicles to which RCFC is a
party other than the Vehicle Disposition Programs and any
Vehicle insurance agreements (collectively, the "RCFC
Agreements"), including, without limitation, all monies
due and to become due to RCFC from the Lessees under or
in connection with the RCFC Agreements, whether payable
as rent, guaranty payments, fees, expenses, costs,
indemnities, insurance recoveries, damages for the breach
of any of the RCFC Agreements or otherwise, and all
rights, remedies, powers, privileges and claims of RCFC
against any other party under or with respect to the RCFC
Agreements (whether arising pursuant to the terms of such
RCFC Agreements or otherwise available to RCFC at law or
in equity), including the right to enforce any of the
RCFC Agreements as provided herein and to give or
withhold any and all consents, requests, notices,
directions, approvals, extensions or waivers under or
with respect
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to the RCFC Agreements or the obligations of any party
thereunder;
(ii) the Demand Note; and
(iii) all proceeds, products, offspring, rents or profits of
any and all of the foregoing including, without
limitation, payments under insurance (whether or not the
Trustee is the loss payee thereof), and cash;
provided, however, the Master Lease Collateral shall not include the Retained
Distribution Account, any funds on deposit therein from time to time, any
certificates or instruments, if any, representing or evidencing any or all of
the Retained Distribution Account or the funds on deposit therein from time to
time, or any Permitted Investments made at any time and from time to time with
the funds on deposit in the Retained Distribution Account (including the income
thereon).
(b) To further secure the RCFC Obligations with respect
to the Series 1998-1 Notes (but not any other Series of Notes), RCFC hereby
pledges, assigns, conveys, delivers, transfers and sets over to the Enhancement
Agent for the benefit of the Group II Noteholders (but not any other Series of
Notes), and hereby grants to the Enhancement Agent for the benefit of the Group
II Noteholders, a security interest in all of RCFC's right, title and interest
in and to all of the following assets, property and interests in property,
whether now owned or hereafter acquired or created:
(i) the Series 1998-1 Letter of Credit; and
(ii) (A) any Series 1998-1 Cash Collateral Account;
(B) all funds on deposit therein from time to time; (C) all certificates and
instruments, if any, representing or evidencing any or all of any such Series
1998-1 Cash Collateral Account or the funds on deposit therein from time to
time; (D) all investments made at any time and from time to time with moneys in
any such Series 1998-1 Cash Collateral Account; and (E) all proceeds of any and
all of the foregoing, including, without limitation, cash.
(c) The Trustee and the Enhancement Agent, as trustees on
behalf of the Group II Noteholders, each acknowledges the foregoing grant,
accepts the trusts under this Supplement in accordance with the provisions of
the Indenture and this Supplement and agrees to perform its duties required in
this Supplement to the best of its abilities to the end that the interests of
the Group II Noteholders may be adequately and effectively protected. The
Master Lease Collateral shall secure the Notes equally and ratably without
prejudice, priority (except as otherwise stated in this Supplement) or
distinction.
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ARTICLE 4A
INITIAL ISSUANCE AND INCREASES AND DECREASES OF
SERIES 1998-1 INVESTED AMOUNT OF SERIES 1998-1 NOTES
Section 4A.1 Issuance in Definitive Form. Pursuant to Section 2.19
of the Base Indenture, upon request by the Note Purchaser, the Issuer hereby
consents to the issuance of the Series 1998-1 Notes in the form of Definitive
Notes. The Series 1998-1 Notes shall initially be sold to investors in
reliance on an exemption from the registration requirements of the Securities
Act, and shall be issued in the form of one or more Definitive Notes, in fully
registered form without interest coupons, substantially in the form attached
hereto as Exhibit A, with such legends as may be applicable thereto, duly
executed by the Issuer and authenticated by the Trustee as provided in Section
2.4 of the Base Indenture, in an aggregate stated principal amount of up to
$615,000,000 (the "Series 1998-1 Maximum Invested Amount"). The aggregate
principal amount of the Series 1998-1 Notes outstanding may not exceed such
amounts.
Section 4A.2 Procedure for Increasing the Series 1998-1 Invested
Amount.
(a) Subject to satisfaction of the conditions precedent set forth in
subsection (b) of this Section 4A.2 (as evidenced by an Officer's Certificate
of the Master Servicer delivered to the Trustee), on the Series 1998-1 Closing
Date, the Issuer may issue Series 1998-1 Notes in the maximum invested amount
described in Section 4A.1, the initial aggregate principal amounts of which
will be equal to the Series 1998-1 Initial Invested Amount. Such Series 1998-1
Notes shall be issued to the Note Purchaser. On the Series 1998-1 Funding Date
and thereafter on each Increase Date during the Series 1998-1 Revolving Period,
the Issuer may, upon written request by the Lessor under the Master Lease and
upon not less than one Business Day's prior written notice by the Collateral
Agent to the Note Purchaser in the manner provided in the Note Purchase
Agreement (such notice specifying the applicable Increase Date), increase the
Series 1998-1 Invested Amount (each such increase referred to as an "Increase")
in the manner provided in the Series 1998-1 Notes amounts that satisfy the
following requirements: (i) the portion of the Increase represented by
additional Series 1998-1 Invested Amount shall be such that the Enhancement
Amount shall at least equal the Minimum Enhancement Amount after giving effect
to such Increase in the Series 1998-1 Invested Amount and the application of
the proceeds thereof to leasing Vehicles; and (ii) no Asset Amount Deficiency
will result from such Increase. Satisfaction of the above conditions shall be
evidenced by the delivery of a certificate from the Master Servicer to such
effect to each of the Trustee and the Enhancement Agent. Proceeds from any
Increase shall be deposited into the Series 1998-1 Collection Account and
allocated in accordance with Article 4 hereof. Upon each Increase, the Trustee
shall, or shall cause the Note Registrar to, indicate in the Note Register such
Increase.
(b) The Series 1998-1 Invested Amount may be increased pursuant to
subsection (a) above only upon satisfaction of each of the following conditions
(as evidenced by an Officers' Certificate delivered by the Issuer to the
Trustee) with respect to each proposed Increase:
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(i) The amount of such Increase shall be equal to or greater
than $100,000;
(ii) After giving effect to such Increase, the Series 1998-1
Invested Amount shall not exceed the Series 1998-1 Maximum Invested
Amount;
(iii) There shall not then exist, nor shall such Increase
result in the occurrence of, (x) an Amortization Event, a Liquidation
Event of Default or a Series 1998-1 Limited Liquidation Event of
Default, or (y) an event or occurrence, which, with the passing of
time or the giving of notice thereof, or both, would become an
Amortization Event, a Liquidation Event of Default or a Series 1998-1
Limited Liquidation Event of Default;
(iv) All conditions precedent (1) to the acquisition of
additional Vehicles under the Master Lease, (2) to the making of
Advances (as defined in the Note Purchase Agreement) under the Note
Purchase Agreement and (3) to the issuance of Commercial Paper Notes
as specified in the Liquidity Agreement shall have, in each case, been
satisfied;
(v) The Issuer or, with respect to Financed Vehicles, the
applicable Lessee, as the case may be, shall have good and marketable
title to each Vehicle purchased thereby with the proceeds from the
sale of and of Increases in the Series 1998-1 Notes, free and clear of
all Liens and encumbrances, other than any Permitted Liens. Each
Eligible Vehicle Disposition Program shall be in full force and
effect, and shall be enforceable against the related Manufacturer in
accordance with its terms;
(vi) Each Lessee shall have granted to the Master Collateral
Agent (or, in the case of the Existing Fleet, Chrysler Financial
Corporation), for the benefit of the Trustee, and RCFC shall have
granted to the Master Collateral Agent, for the benefit of the
Trustee, in each case on behalf of the Series 1998-1 Noteholders, a
first priority security interest in all Series 1998-1 Vehicles now or
hereafter purchased or financed by the Issuer with the proceeds from
the sale of and Increases in the Series 1998-1 Notes or with any
contributions of capital made by DTAG in favor of the Issuer;
(vii) the Issuer shall have granted to the Trustee a first
priority security interest in its right, title and interest in and to
the Master Lease and the Master Lease Collateral;
(viii) on or prior to the Series 1998-1 Closing Date, the
Trustee shall have received executed counterparts of the Assignment
Agreements related to the assignment of rights under each Eligible
Vehicle Disposition Program, duly executed by the applicable Lessee
and/or the Issuer, as assignor, and the Trustee, as assignee;
(ix) the Trustee shall have received a copy of each Eligible
Vehicle Disposition Program under which Series 1998-1 Vehicles will be
or have been purchased and are proposed to be included in the
Aggregate Asset Amount and an Officer's Certificate, dated the Series
1998-1 Closing Date, and duly executed by an Authorized Officer of the
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Issuer, certifying that each such copy is true, correct and complete
as of the Series 1998-1 Closing Date;
(x) Notice of such Increase shall have been delivered to the
Collateral Agent and the Liquidity Agent;
(xi) All representations and warranties set forth in Article
6 of the Base Indenture and in Section 23 of the Master Lease shall be
true and correct; and
(xii) With respect to the initial Increase only, the Master
Servicer shall have calculated the Series 1998-1 Available
Subordinated Amount and the Enhancement Amount.
Section 4A.3 Decreases.
(a) Mandatory Decreases. Whenever the Enhancement Amount is less
than the Minimum Enhancement Amount, then, on the Payment Date immediately
following discovery of such deficiency, the Issuer shall decrease the Series
1998-1 Invested Amount by the amount (if any) necessary, so that after giving
effect to any increases in the Enhancement Amount on or prior to such Payment
Date and to all Decreases of the Series 1998-1 Invested Amount on such Payment
Date, no such deficiency shall exist on such Payment Date (each reduction of
the Series 1998-1 Invested Amount pursuant to this Section 4A.3(a), a
"Mandatory Decrease"). Upon such discovery, the Issuer shall deliver notice of
any such Mandatory Decreases to the Trustee.
(b) Voluntary Decreases. Upon at least three Business Days' prior
irrevocable notice to the Note Purchaser and the Trustee in writing, the Issuer
may voluntarily prepay all or a portion of the Series 1998-1 Invested Amount in
accordance with the procedures set forth herein (each reduction of the Series
1998-1 Invested Amount pursuant to this Section 4A.3(b), a "Voluntary
Decrease"); provided, that all voluntary Decreases pursuant to this Section
4A.3(b) shall be allocated such that (1) the Enhancement Amount after giving
effect to such Decrease is not less than the Minimum Enhancement Amount. Each
such Decrease shall be, in the aggregate for all Series 1998-1 Notes, in a
minimum principal amount of $100,000. The Note Purchaser shall promptly advise
the Liquidity Agent of any notice given pursuant to this Section 4A.3(b).
(c) Upon receipt by a Responsible Officer of the Trustee of written
notice that a Decrease has been completed, the Trustee shall, or shall cause
the Note Registrar to, indicate in the Note Register such Decrease. The amount
of any Decrease shall not exceed the amount on deposit in the Series 1998-1
Collection Account and available for distribution to Series 1998-1 Noteholders
in respect of principal on the Series 1998-1 Notes on the date specified in the
related notice of Decrease referred to in clauses (a) and (b) above.
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ARTICLE 4.
ALLOCATION AND APPLICATION OF COLLECTIONS
Any provisions of Article 4 of the Base Indenture which
allocate and apply Collections shall continue to apply irrespective of the
issuance of the Series 1998-1 Notes. Sections 4.1 through 4.5 of the Base
Indenture shall be read in their entirety as provided in the Base Indenture,
provided that for purposes of the Series 1998-1 Notes, clauses (c), (d) and (e)
of Section 4.2 of the Base Indenture shall be modified as permitted by Section
11.1(f) of the Base Indenture and shall read as follows:
(c) Right of Master Servicer to Deduct Fees. Notwithstanding
anything in this Indenture to the contrary but subject to any limitations set
forth in the applicable Supplement, as long as (x) the Master Servicer is DTAG
or an Affiliate of DTAG and (y) the Retained Amount equals or exceeds zero, the
Master Servicer (i) may make or cause to be made deposits of Collections to the
Group II Collection Account net of any amounts which are allocable to the
Retained Distribution Account and represent amounts due and owing to it in its
capacity as Master Servicer and (ii) need not deposit or cause to be deposited
any amounts to be paid to the Master Servicer pursuant to this Section 4.2 and
such amounts will be deemed paid to the Master Servicer, as the case may be,
pursuant to this Section 4.2.
(d) Sharing Collections. To the extent that Principal
Collections that are allocated to the Series 1998-1 Notes on a Payment Date are
not needed to make payments of principal to Series 1998-1 Noteholders or
required to be deposited in the Series 1998-1 Distribution Account on such
Payment Date, such Principal Collections may, at the written direction of the
Master Servicer, be applied to cover principal payments due to or for the
benefit of Noteholders of other Group II Series of Notes. Any such
reallocation will not result in a reduction of the Aggregate Principal Balance
or in the Invested Amount of the Series 1998-1 Notes.
(e) Unallocated Principal Collections. If, after giving
effect to Section 4.2(d), Principal Collections allocated to the Series 1998-1
Notes on any Payment Date are in excess of the amount required to pay amounts
due in respect of the Series 1998-1 Notes on such Payment Date in full, then
any such excess Principal Collections shall be allocated to the Retained
Distribution Account (provided that no Series 1998-1 Enhancement Deficiency or
Asset Amount Deficiency exists or would result from such allocation).
In addition, for purposes of Section 4.2(a) of the Base
Indenture, the Master Servicer in its capacity as such under the Master Lease
shall cause all Collections allocable to Group II Collateral in accordance with
the Indenture and the Master Collateral Agency Agreement, as applicable, to be
paid directly into the Group II Collection Account or the Master Collateral
Account, as applicable.
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Article 4 of the Base Indenture (except for Sections 4.1
through 4.5 thereof subject to the proviso in the first paragraphs of this
Article 4 and the immediately preceding sentence) shall read in its entirety as
follows and shall be applicable only to the Series 1998-1 Notes:
Section 4.6 Establishment of Group II Collection Account,
Series 1998-1 Collection Account, Series 1998-1 Excess Funding
Account, and Series 1998-1 Accrued Interest Account.
(a) The Trustee will create three
administrative sub-accounts within the Collection Account.
One sub-account will be established for the benefit of holders
of Notes from a Group II Series of Notes (such sub-account,
the "Group II Collection Account"). Another sub-account will
be established for the benefit of the Series 1998-1
Noteholders (such sub-account, the "Series 1998-1 Collection
Account"). A third sub-account will be established for the
benefit of the Series 1998-1 Noteholders (such sub-account,
the "Series 1998-1 Excess Funding Account").
(b) The Trustee will further divide the
Series 1998-1 Collection Account by creating an additional
administrative sub-account for the Series 1998-1 Noteholders
(such sub-account, the "Series 1998-1 Accrued Interest
Account").
(c) All Collections in respect of the Group
II Collateral and allocable to the Group II Series of Notes
shall be allocated to the Group II Collection Account. All
Collections in the Group II Collection Account allocable to
the Series 1998-1 Notes and the Series 1998-1 Available
Subordinated Amount shall be allocated to the Series 1998-1
Collection Account or the Series 1998-1 Excess Funding Account
as provided herein below.
Section 4.7 Allocations with Respect to the Series 1998-1
Notes. All allocations in this Section 4.7 will be made in accordance
with written direction of the Master Servicer. The proceeds from the
sale of the Series 1998-1 Notes (or the initial Increase, as
applicable), together with any funds deposited with RCFC by DTAG in
its capacity as the Retained Interestholder, will, on the Series
1998-1 Closing Date, be deposited by the Trustee into the Collection
Account and, concurrently with such initial deposit, allocated by the
Trustee to the Group II Collection Account in accordance with Section
4.6(c) above, and thereupon to the Series 1998-1 Excess Funding
Account. On each Business Day on which Collections are deposited into
the Group II Collection Account (each such date, a "Series 1998-1
Deposit Date"), the Master Servicer will direct the Trustee in writing
to allocate all amounts deposited into the Group II Collection Account
in accordance with the provisions of this Section 4.7:
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(a) Allocations During the Revolving Period.
During the Series 1998-1 Revolving Period, the Master Servicer
will direct the Trustee in writing to allocate, on each Series
1998-1 Deposit Date, all amounts deposited into the Group II
Collection Account as set forth below:
(i) with respect to all Collections
(including Recoveries) and from Increases:
(1) allocate to the Series 1998-1
Collection Account an amount equal to the
Series 1998-1 Interest Collections received
on such day. All such amounts allocated to
the Series 1998-1 Collection Account shall be
further allocated to the Series 1998-1
Accrued Interest Account; provided, however,
that if with respect to any Related Month the
aggregate of all such amounts allocated to
the Series 1998-1 Accrued Interest Account
during such Related Month exceeds the amount
of interest and fees due and payable in
respect of the Series 1998-1 Notes on the
Payment Date next succeeding such Related
Month pursuant to Section 4.8, then the
amount of such excess shall be allocated to
the Series 1998-1 Excess Funding Account;
(2) to the extent a Mandatory Decrease
is required under Section 4A.3(a) of this
Supplement, allocate to the Series 1998-1
Distribution Account for the payment of the
Series 1998-1 Invested Amount, an amount
equal to the lesser of (i) the sum of (A) an
amount equal to the Series 1998-1 Invested
Percentage (as of such day) of the aggregate
amount of Collections that are Principal
Collections on such day (for any such day,
such amount, the "Series 1998-1 Principal
Allocation"), plus (B) any other funds on
deposit in the Series 1998-1 Collection
Account and the Series 1998-1 Excess Funding
Account (excluding any Interest Collections
but including proceeds from any Increase) and
(ii) the amount, as stated in such Master
Servicer's direction, necessary for such
Mandatory Decrease;
(3) allocate to the Series 1998-1
Distribution Account the amount, as stated in
such Master Servicer's direction, of any
Voluntary Decreases in the Series 1998-1
Invested Amount to be made in accordance with
Section 4A.3(b) of this Supplement;
(4) allocate to the Series 1998-1
Excess Funding Account an amount equal to the
sum of (A) the Series 1998-1 Principal
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Allocation remaining after the allocation in
clause (3) above, plus (B) the proceeds from
any Increase remaining after the allocations
in clause (2) above;
(5) allocate to the Retained
Distribution Account an amount equal to (x)
the applicable Retained Interest Percentage
(as of such day) of the aggregate amount of
Collections that are Principal Collections on
such date, minus (y) any amounts, other than
Servicing Fees, which have been withheld by
the Master Servicer pursuant to Section
4.2(c) of the Base Indenture to the extent
such amounts withheld under Section 4.2(c) of
the Base Indenture represent all or part of
the Retained Amount;
(ii) with respect to all Recoveries:
(1) allocate an amount equal to the
Series 1998-1 Invested Percentage (as of such
day) of the aggregate amount of Recoveries on
such day, first, to replenish the Series
1998-1 Invested Amount, to the extent that
the Series 1998-1 Invested Amount has
theretofore been reduced as a result of any
Losses allocated thereto pursuant to clause
(iii) below and not replenished pursuant to
this clause (ii); second, to replenish the
Series 1998-1 Cash Collateral Account to the
extent withdrawals have theretofore been made
pursuant to Section 4.14(b) as a result of
any Losses allocated to the Demand Note
pursuant to clause (iii) below that have not
been paid under such Demand Note and not
replenished pursuant to this clause (ii);
third, to replenish the Series 1998-1
Available Subordinated Amount to the extent
that the Series 1998-1 Available Subordinated
Amount has theretofore been reduced as a
result of any Losses allocated thereto
pursuant to clause (iii) below and not
replenished pursuant to this clause (ii); and
fourth, any remaining Recoveries not so
allocated ("Revolving Period Profits") shall
be released to the Issuer and available, at
the Issuer's option, to be loaned to DTAG
under the Demand Note or used for other
corporate purposes; and
(2) allocate to the Retained Amount an
amount equal to the Retained Interest
Percentage (as of such day) of the aggregate
amount of Recoveries on such date to the
extent that the Retained Amount has
theretofore been reduced as a result of any
Losses allocated thereto pursuant to clause
(iii) below and not replenished pursuant to
this clause (ii);
(iii) with respect to all Losses:
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(1) allocate an amount equal to the
Series 1998-1 Invested Percentage (as of such
day) of the aggregate amount of Losses on
such day, first, to reduce the Series 1998-1
Available Subordinated Amount until the
Series 1998-1 Available Subordinated Amount
has been reduced to zero; second, allocate
remaining losses to making a claim under the
Demand Note until such claim would reduce the
Demand Note to zero; and third, allocate
remaining Losses to reduce the Series 1998-1
Invested Amount until the Series 1998-1
Invested Amount has been reduced to zero; and
(2) on any such Business Day allocate
to the Retained Amount an amount equal to the
Retained Interest Percentage (as of such day)
of the aggregate amount of such Losses on
such day, which amount shall reduce the
Retained Amount.
(iv) with respect to all Lease Payment
Recoveries:
(1) allocate an amount equal to the
Series 1998-1 Invested Percentage (as of such
day) of the aggregate amount of Lease Payment
Recoveries on such day, first, to replenish
the Series 1998-1 Invested Amount to the
extent that the Series 1998-1 Invested Amount
has theretofore been reduced as a result of
any Lease Payment Losses allocated thereto
pursuant to clause (v) below and not
replenished pursuant to this clause (iv);
second, to replenish the Series 1998-1 Cash
Collateral Account to the extent withdrawals
have theretofore been made pursuant to
Section 4.14(b) as a result of any Lease
Payment Losses allocated to the Series 1998-1
Letter of Credit pursuant to clause (v) below
that have not been paid under such Series
1998-1 Letter of Credit and not replenished
pursuant to this clause (iv); and third, to
replenish the Series 1998-1 Available
Subordinated Amount to the extent that the
Series 1998-1 Available Subordinated Amount
has theretofore been reduced as a result of
any Lease Payment Losses allocated thereto
pursuant to clause (v) below and not
replenished pursuant to this clause (iv); and
(2) allocate to the Retained Amount an
amount equal to the Retained Interest
Percentage (as of such day) of the aggregate
amount of Lease Payment Recoveries on such
date to the extent that the Retained Amount
has theretofore been reduced as a result of
any Lease Payment Losses allocated thereto
pursuant to clause (v) below and not
replenished pursuant to this clause (iv));
(v) with respect to all Lease Payment
Losses:
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(1) allocate an amount equal to the
Series 1998-1 Invested Percentage (as of such
day) of the aggregate amount of Lease Payment
Losses on such day, first, to reduce the
Series 1998-1 Available Subordinated Amount
until the Series 1998-1 Available
Subordinated Amount has been reduced to zero;
second, allocate remaining Lease Payment
Losses to making a drawing under the Series
1998-1 Letter of Credit until such drawing
would reduce the Series 1998-1 Letter of
Credit Amount to zero; and third, allocate
remaining Lease Payment Losses to reduce the
Invested Amount until the Series 1998-1
Invested Amount has been reduced to zero; and
(2) allocate to the Retained Amount an
amount equal to the Retained Interest
Percentage (as of such day) of the aggregate
amount of such Lease Payment Losses on such
day, which amount shall reduce the Retained
Amount.
(b) Allocations During the Series 1998-1 Controlled
Amortization Period. During the Series 1998-1 Controlled Amortization
Period, the Master Servicer will direct the Trustee in writing to
allocate, on each Series 1998-1 Deposit Date, all amounts deposited
into the Group II Collection Account as set forth below:
(i) with respect to all Collections
(including Recoveries):
(1) allocate to the Series 1998-1
Collection Account an amount determined as
set forth in Section 4.7(a)(i)(1) above for
such day, which amount shall be deposited in
the Series 1998-1 Accrued Interest Account
and, as to the extent provided in Section
4.7(a)(i)(1) above, allocated to the Series
1998-1 Excess Funding Account;
(2) allocate to the Series 1998-1
Collection Account an amount equal to the
Series 1998-1 Principal Allocation for such
day, which amount shall be used to make
principal payments in respect of the Series
1998-1 Notes; provided, however, that if the
aggregate amount of all the Series 1998-1
Principal Allocations during such calendar
month exceeds the Series 1998-1 Controlled
Distribution Amount for the Related Month
such excess shall be allocated to the Series
1998-1 Excess Funding Account; and
(3) allocate to the Retained
Distribution Account an amount determined as
set forth in Section 4.7(a)(i)(5) above for
such day;
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(ii) with respect to all Recoveries:
(1) increase the Series 1998-1
Invested Amount, replenish the Series 1998-1
Cash Collateral Account to the extent
withdrawals have theretofore been made
pursuant to Section 4.14(b) as a result of
any Losses allocated to the Demand Note
pursuant to clause (iii) below that have not
been paid under such Demand Note and not
replenished under this clause (ii), increase
the Series 1998-1 Available Subordinated
Amount, and release any remaining Recoveries
("Controlled Amortization Period Profits") to
the Issuer, as and to the extent provided in
Section 4.7(a)(ii)(1) above for such day; and
(2) allocate to the Retained Amount an
amount determined as set forth in Section
4.7(a)(ii)(2) above for such day;
(iii) with respect to all Losses:
(1) decrease the Series 1998-1
Available Subordinated Amount, make a claim
under the Demand Note and decrease the Series
1998-1 Invested Amount as and to the extent
provided in Section 4.7(a)(iii)(1) above for
such day; and
(2) allocate to the Retained Amount an
amount determined as set forth in Section
4.7(a)(iii)(2) above for such day, which
amount shall reduce the Retained Amount.
(iv) with respect to all Lease Payment
Recoveries:
(1) increase the Series 1998-1
Invested Amount, replenish the Series 1998-1
Cash Collateral Account to the extent
withdrawals have theretofore been made
pursuant to Section 4.14(b) as a result of
any Lease Payment Losses allocated to the
Series 1998-1 Letter of Credit pursuant to
clause (v) below and not replenished under
this clause (iv); and increase the Series
1998-1 Available Subordinated Amount as and
to the extent provided in Section
4.7(a)(iv)(1) above for such day; and
(2) allocate to the Retained Amount an
amount determined as set forth in Section
4.7(a)(iv)(2) above for such day;
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(v) with respect to all Lease Payment
Losses:
(1) decrease the Series 1998-1
Available Subordinated Amount, make a claim
under the Series 1998-1 Letter of Credit and
decrease the Series 1998-1 Invested Amount as
and to the extent provided in Section
4.7(a)(v)(1) above for such day; and
(2) allocate to the Retained Amount an
amount determined as set forth in Section
4.7(a)(v)(2) above for such day, which amount
shall reduce the Retained Amount.
(c) Allocations During the Series 1998-1 Rapid
Amortization Period. During the Series 1998-1 Rapid Amortization
Period, the Master Servicer will direct the Trustee in writing to
allocate, on each Series 1998-1 Deposit Date, all amounts deposited
into the Group II Collection Account as set forth below:
(i) with respect to all Collections
(including Recoveries):
(1) allocate to the Series 1998-1
Collection Account an amount determined as
set forth in Section 4.7(a)(i)(1) above for
such day, plus an amount up to $500,000 to be
applied to the payment of legal fees and
expenses, if any, and, if DTAG is no longer
the Master Servicer, the amount equal to the
sum of the Series 1998-1 Monthly Servicing
Fee and Series 1998-1 Monthly Supplemental
Servicing Fee, which amount shall be
deposited in the Series 1998-1 Accrued
Interest Account and, as and to the extent
provided in Section 4.7(a)(i)(1) above,
allocated to the Series 1998-1 Excess Funding
Account;
(2) allocate to the Series 1998-1
Collection Account an amount equal to the
Series 1998-1 Principal Allocation for such
day, which amounts shall be used to make
principal payments on a pro rata basis in
respect of the Series 1998-1 Notes; and
(3) allocate to the Retained
Distribution Account an amount determined as
set forth in Section 4.7(a)(i)(5) above for
such day;
(ii) with respect to all Recoveries:
(1) increase the Series 1998-1
Invested Amount, replenish the Series 1998-1
Cash Collateral Account to the extent
withdrawals have theretofore been made
pursuant to Section 4.14(b) as a result of
any Losses allocated to the Demand Note
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pursuant to clause (iii) below that have not
been paid under such Demand Note and not
replenished under this clause (ii) increase
the Series 1998-1 Available Subordinated
Amount, and release any remaining Recoveries
("Rapid Amortization Period Profits" and,
collectively with the Revolving Period
Profits and the Controlled Amortization
Period Profits, the "Profits") to the Issuer,
as and to the extent provided in Section
4.7(a)(ii)(1) above for such day; and
(2) allocate to the Retained Amount an
amount determined as set forth in Section
4.7(a)(ii)(2) above for such day;
(iii) with respect to all Losses:
(1) decrease the Series 1998-1
Available Subordinated Amount, make a claim
under the Demand Note and decrease the Series
1998-1 Invested Amount as and to the extent
provided in Section 4.7(a)(iii)(1) above for
such day; and
(2) allocate to the Retained Amount an
amount determined as set forth in Section
4.7(a)(iii)(2) above for such day, which
amount shall reduce the Retained Amount.
(iv) with respect to all Lease Payment
Recoveries:
(1) increase the Series 1998-1
Invested Amount, replenish the Series 1998-1
Cash Collateral Account to the extent
withdrawals have theretofore been made
pursuant to Section 4.14(b) as a result of
any Lease Payment Losses allocated to the
Series 1998-1 Letter of Credit pursuant to
clause (v) below and not replenished under
this clause (iv); and increase the Series
1998-1 Available Subordinated Amount as and
to the extent provided in Section
4.7(a)(iv)(1) above for such day; and
(2) allocate to the Retained Amount an
amount determined as set forth in Section
4.7(a)(iv)(2) above for such day;
(v) with respect to all Lease Payment
Losses:
(1) decrease the Series 1998-1
Available Subordinated Amount, make a claim
under the Series 1998-1 Letter of Credit and
decrease the Series 1998-1 Invested Amount as
and to the extent provided in Section
4.7(a)(v)(1) above for such day; and
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(2) allocate to the Retained Amount an
amount determined as set forth in Section
4.7(a)(v)(2) above for such day, which amount
shall reduce the Retained Amount.
(d) Additional Allocations. Notwithstanding the
foregoing provisions of this Section 4.7,
(i) provided the Series 1998-1 Rapid Amortization
Period has not commenced, amounts allocated to the Series
1998-1 Excess Funding Account that are not required to make
payments under the Series 1998-1 Notes pursuant hereto may, as
and to the extent permitted in the related Supplements, be
used to pay the principal amount of other Group II Series of
Notes that are then in amortization and, after such payment,
any remaining funds may, at RCFC's option, be (i) used to
finance or acquire Vehicles, to the extent Eligible Vehicles
have been requested by any of the Lessees under the Master
Lease or (ii) transferred, on any Payment Date, to the
Retained Distribution Account, to the extent that the Retained
Amount equals or exceeds zero after giving effect to such
payment and so long as no Series 1998-1 Enhancement Deficiency
or Asset Amount Deficiency exists or would result therefrom;
provided, however, that funds remaining after the application
of such funds to the payment of the principal amount of other
Group II Series of Notes that are in amortization and to the
financing or acquisition of Group II Vehicles may be
transferred to the Retained Distribution Account on a day
other than a Payment Date if the Master Servicer furnishes to
the Trustee an Officer's Certificate to the effect that such
transfer will not cause any of the foregoing deficiencies to
occur either on the date that such transfer is made or, in the
reasonable anticipation of the Master Servicer, on the next
Payment Date. Funds in the Retained Distribution Account
shall, at the option of RCFC, be available to finance or
acquire Vehicles, to the extent Eligible Vehicles have been
requested by any of the Lessees under the Master Lease, or for
distribution to the Retained Interestholder (including any
advances made under the Demand Note);
(ii) in the event that the Master Servicer is not
DTAG or an Affiliate of DTAG, the Master Servicer shall not be
entitled to withhold any amounts pursuant to Section 4.2(c)
and the Trustee shall deposit amounts payable to DTAG in its
capacity as the Master Servicer in the Collection Account
pursuant to the provisions of Section 4.2 on each Series
1998-1 Deposit Date;
(iii) any amounts withheld by the Master Servicer
and not deposited in the Collection Account pursuant to
Section 4.2(c) shall be deemed to be deposited in the
Collection Account on the date such amounts are withheld for
purposes of determining the amounts to be allocated pursuant
to this Section 4.7;
(iv) if there is more than one Series of Group II
Series of Notes outstanding, then Sections 4.7(a)(i)(5),
4.7(b)(i)(3) and 4.7(c)(i)(3) above shall not
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<PAGE> 57
be duplicative with any similar provisions contained in any
other Supplement and the Retained Interestholder shall only be
paid such amount once with respect to any Payment Date; and
(v) RCFC may, from time to time in its sole
discretion, increase the Series 1998-1 Available Subordinated
Amount by (a) (i) allocating to the Series 1998-1 Available
Subordinated Amount Eligible Vehicles theretofore allocated to
the Retained Interest and (ii) delivering to the Trustee an
Officer's Certificate affirming with respect to such Vehicles
the representations and warranties set forth in Section 6.14
of the Base Indenture (and an Opinion of Counsel to the same
effect) or (b) (i) depositing funds into the Series 1998-1
Excess Funding Account by transfer from the Retained
Distribution Account or otherwise, and (ii) delivering to the
Master Servicer and the Trustee an Officer's Certificate
setting forth the amount of such funds and stating that such
funds shall be allocated to the Series 1998-1 Available
Subordinated Amount; provided, however, that (x) RCFC shall
have no obligation to so increase the Series 1998-1 Available
Subordinated Amount at any time and (y) RCFC may not increase
the Series 1998-1 Available Subordinated Amount at any time if
the amount of such increase, together with the sum of the
amounts of all prior increases, if any, of the Series 1998-1
Available Subordinated Amount would exceed the applicable
Series 1998-1 Available Subordinated Amount Maximum Increase,
excluding from such calculation any increase in the Series
1998-1 Available Subordinated Amount (1) through Recoveries or
from funds constituting repayments of principal under the
Demand Note, or (2) relating to an increase in the Minimum
Series 1998-1 Enhancement Amount that results from (a) an
increase in the ratio of Group II Vehicles that are
Non-Program Vehicles to all Group II Vehicles, (b) a reduction
in the aggregate amount of cash and Permitted Investments in
the Collection Account and the Master Collateral Account that
are allocable to the Group II Series of Notes, or (c) a
decrease in Market Value Adjustment Percentage;
(vi) If, on any Payment Date during the Series
1998-1 Revolving Period, a Mandatory Decrease shall be
required under Section 4A.3(a) of this Supplement and the
amounts allocated to the Series 1998-1 Invested Amount under
Section 4.7(a)(i)(2) are less than the amount of such required
Decrease, then, in such event, any funds (i) on deposit in the
Collection Account which are allocable to the Retained Amount
or (ii) on deposit in the excess funding accounts for other
Group II Series of Notes issued and outstanding under the
Indenture which amounts are in excess of the amounts necessary
to be on deposit in each such excess funding account in order
that (x) no Asset Amount Deficiency occur, (y) no shortfall in
the required level of enhancement for each such Group II
Series of Notes shall occur, including any portion of such
enhancement that is required to be in liquid funds, and (z) no
Amortization Event for any such series or event that with the
giving of notice or passage of time would become an
Amortization Event
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for any such Group II Series of Notes (such amounts as are set
forth in clauses (i) and (ii) of this subparagraph (vi) being
referred to herein as "Excess Amounts") shall, in each such
case, be deposited into the Series 1998-1 Distribution Account
as Principal Collections in an aggregate amount up to the
amount of any such deficiency and shall be used, in accordance
with Section 4.10(b), to reduce the Series 1998-1 Invested
Amount;
(vii) If, on any Payment Date during the Series
1998-1 Controlled Amortization Period, the Monthly Total
Principal Allocation under Section 4.7(b)(i)(2) is less than
the Controlled Distribution Amount for the Related Month and
required to be paid on such Payment Date, then, in either such
event, any funds constituting Excess Amounts shall, in each
such case, be deposited into the Series 1998-1 Distribution
Account as Principal Collections in an aggregate amount up to
the amount of any such deficiency and shall be used, in
accordance with Section 4.10(a) to reduce the Series 1998-1
Invested Amount; and
(viii) If, on any Payment Date during the Series
1998-1 Rapid Amortization Period, the Monthly Total Principal
Allocation under Section 4.7(c)(i)(3) is insufficient to
reduce the Series 1998-1 Invested Amount to zero, then, in
such event, any funds constituting Excess Amounts shall, in
each such case, be deposited into the Series 1998-1
Distribution Account as Principal Collections in an aggregate
amount up to the amount of any such deficiency and shall be
used, in accordance with Section 4.10(a) or (b), as
applicable, to reduce the Series 1998-1 Invested Amount.
Section 4.8 Monthly Payments.
All of the payments in this Section 4.8 will be made
in accordance with written direction of the Master Servicer. On each
Reporting Date, as provided below, the Master Servicer shall instruct
the Trustee to withdraw, and on the following Payment Date the
Trustee, acting in accordance with such instructions, shall withdraw
the amounts required to be withdrawn from the Group II Collection
Account pursuant to Sections 4.8(a) through (c) below in respect of
all funds available from Series 1998-1 Interest Collections processed
since the preceding Payment Date and allocated to the holders of the
Series 1998-1 Notes.
(a) Note Interest with respect to the Series 1998-1
Notes. On each Reporting Date, the Master Servicer shall instruct the
Trustee or the Paying Agent to withdraw on the next succeeding Payment
Date from the Series 1998-1 Accrued Interest Account and deposit in
the Series 1998-1 Distribution Account the amount on deposit therein
available for the payment of the Series 1998-1 Interest Amount. On
such Determination Date, the Master Servicer shall further instruct
the Trustee in writing to withdraw on the next succeeding Payment Date
from the Series 1998-1 Excess Funding Account the lesser of (i) the
amount on deposit in the Series 1998-1 Excess Funding
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Account and (ii) the excess, if any, of the Series 1998-1 Interest
Amount over the amount withdrawn from the Series 1998-1 Accrued
Interest Account pursuant to the preceding sentence and deposit such
amount to the Series 1998-1 Distribution Account. If the amounts
described in this Section 4.8(a) are insufficient, after taking into
account any funds available in the Series 1998-1 Excess Funding
Account and any portion of the Series 1998-1 Letter of Credit Amount
applied as described in Section 4.9 of this Supplement, to pay the
Series 1998-1 Interest Amount on any Payment Date, payments of
interest to the Series 1998-1 Noteholders will be reduced by the
amount of such shortfall. The amount, if any, of such shortfall on
any Payment Date shall be referred to as the "Series 1998-1 Deficiency
Amount". Interest shall accrue on the Series 1998-1 Deficiency Amount
at the applicable Series 1998-1 Note Rate. On the following Payment
Date, the Trustee shall withdraw the Series 1998-1 Interest Amount
from the Series 1998-1 Accrued Interest Account and, to the extent
provided in Section 4.9 of this Supplement, amounts withdrawn from the
Series 1998-1 Excess Funding Account and any applied portion of the
Series 1998-1 Letter of Credit Amount, and shall deposit such amount
in the Series 1998-1 Distribution Account; provided that the amounts
to be withdrawn from the Series 1998-1 Excess Funding Account pursuant
to this Section 4.8(a) of this Supplement shall not exceed for any
Determination Date the Series 1998-1 Available Subordinated Amount at
such time.
(b) Legal Fees. On each Payment Date during the
Rapid Amortization Period, the Master Servicer shall, prior to making
all distributions required to be made pursuant to Section 4.8(a) of
this Supplement, instruct the Trustee in writing to withdraw from the
Series 1998-1 Accrued Interest Account, for payment to the Issuer, an
amount up to an aggregate amount for all such Payment Dates of
$500,000 to be applied to the payment of legal fees and expenses, if
any, of the Issuer. On such Payment Date, the Trustee shall withdraw
such amount from the Series 1998-1 Accrued Interest Account and remit
such amount to the Issuer.
(c) Servicing Fee. On each Payment Date, the Master
Servicer shall, after directing all distributions required to be made
pursuant to Sections 4.8(a) and (b) of this Supplement or in the event
that on the related Determination Date DTAG or any Affiliate thereof
shall no longer be the Master Servicer, prior to such distributions
being made (or if in addition to the foregoing the Series 1998-1 Rapid
Amortization Period has also commenced, prior to making all
distributions required to be made pursuant to Section 4.8(a) of this
Supplement but after making all distributions required to be made
pursuant to Section 4.8(b)), instruct in writing the Trustee to
withdraw from the Series 1998-1 Accrued Interest Account, for payment
to the Master Servicer, an amount equal to (a) the Series 1998-1
Investor Monthly Servicing Fee and any Series 1998-1 Monthly
Supplemental Servicing Fee accrued during the preceding Series 1998-1
Interest Period, plus (b) all accrued and unpaid Series 1998-1
Investor Monthly Servicing Fees and any accrued and unpaid Series
1998-1 Monthly Supplemental Servicing Fees, minus (c) the amount of
any Series 1998-1 Investor Monthly Servicing Fees and Series 1998-1
Monthly Supplemental Servicing Fees withheld by the Master Servicer
pursuant to the Base
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Indenture. On such Payment Date, the Trustee shall withdraw such
amount from the Series 1998-1 Accrued Interest Account and remit such
amount to the Master Servicer.
Section 4.9 Payment of Note Interest.
All payments made pursuant to this Section 4.9 will
be made in accordance with the written instructions of the Master
Servicer. On each Payment Date, (i) to the extent any Series 1998-1
Monthly Interest Shortfall exists after the deposits required pursuant
to Section 4.7 of this Supplement has been made, the Master Servicer
shall instruct the Trustee to withdraw from funds on deposit in the
Series 1998-1 Excess Funding Account, an amount equal to the lesser of
(A) the amount on deposit in the Series 1998-1 Excess Funding Account
on such Payment Date in an amount not to exceed the Series 1998-1
Available Subordinated Amount at such time, and (B) the remaining
amount of the Series 1998-1 Interest Amount Shortfall, and deposit
such amount in the Series 1998-1 Distribution Account to pay the
Series 1998-1 Interest Amount and any unpaid Series 1998-1 Deficiency
Amounts with respect to such Series 1998-1 Monthly Interest (together
with accrued interest on all such unpaid Series 1998-1 Deficiency
Amounts)and (ii) to the extent any such Series 1998-1 Monthly Interest
Shortfall remains after the deposit required pursuant to clause (i) of
this Section 4.9 has been made, if amounts have been drawn on the
Series 1998-1 Letter of Credit and deposited into the Series 1998-1
Collection Account pursuant to Section 4.18 of this Supplement, the
Master Servicer shall instruct the Trustee to withdraw from the Series
1998-1 Collection Account on such Payment Date the lesser of (A) the
amount on deposit in the Series 1998-1 Collection Account representing
such amount drawn on the Series 1998-1 Letter of Credit and (B) the
amount of the remaining Series 1998-1 Monthly Interest Shortfall and
deposit such amount in the Series 1998-1 Distribution Account to pay
the Series 1998-1 Interest Amount and any unpaid Series 1998-1
Deficiency Amounts with respect to such Series 1998-1 Interest Amount
(together with accrued interest on all such unpaid Series 1998-1
Deficiency Amounts). On each Payment Date the Trustee shall, in
accordance with Section 5.1 of the Base Indenture and the Master
Servicer's most recent Monthly Certificate, pay to the Series 1998-1
Noteholders from the Series 1998-1 Distribution Account the amount
deposited in the Series 1998-1 Distribution Account for the payment of
the Series 1998-1 Interest Amount pursuant to Section 4.8(a) of this
Supplement and clauses (i) and (ii) of this Section 4.9.
Section 4.10 Payment of Note Principal; Decreases.
All payments made pursuant to this Section 4.10 will
be made in accordance with the written instructions of the Master
Servicer.
(a) Series 1998-1 Notes.
(i) Commencing on the second Determination
Date after the commencement of the Series 1998-1
Controlled Amortization Period or
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the first Determination Date after the commencement
of the Series 1998-1 Rapid Amortization Period, the
Master Servicer shall instruct the Trustee as to the
following: (A) the Series 1998-1 Controlled
Distribution Amount for the Related Month, (B) the
amount allocated to the Series 1998-1 Notes during
the Related Month pursuant to Section 4.7(b)(i)(2) or
4.7(c)(i)(2) of this Supplement, as applicable, and
(C) the amount, if any, by which the amount in clause
(A) above exceeds the amount in clause (B) above (the
amount of such excess the "Series 1998-1 Controlled
Distribution Amount Deficiency"); and
(ii) Commencing on the second Payment Date
after the commencement of the Series 1998-1
Controlled Amortization Period, the Trustee shall, in
respect of the Series 1998-1 Notes, (1) withdraw from
the Series 1998-1 Collection Account an amount equal
to the lesser of the amounts specified in clauses (A)
and (B) of Section 4.10(a)(i) of this Supplement, (2)
to the extent any Series 1998-1 Controlled
Distribution Amount Deficiency remains after
application of the amounts specified in clause (1) of
this subsection, the Master Servicer shall instruct
the Trustee to withdraw, from funds on deposit in the
Excess Funding Accounts for the other Group II Series
of Notes, if any, an amount equal to the lesser of
(x) the aggregate amount on deposit in such Excess
Funding Accounts on such Payment Date (after
application of any such amounts pursuant to Section
4.9 of the related Series Supplements) in an amount
not to exceed the related Available Subordinated
Amounts at such time, and (y) the remaining amount of
the Series 1998-1 Controlled Distribution Amount
Deficiency, and deposit such amounts in the Series
1998-1 Distribution Account to be paid, pro rata, to
the Series 1998-1 Noteholders on account of the
Series 1998-1 Controlled Distribution Amount,
provided that any such amounts withdrawn from the
Excess Funding Accounts for the other Group II Series
of Notes shall be applied on a pro rata basis with
respect to each Group II Series of Notes with respect
to which a Series 1998-1 Controlled Distribution
Amount Deficiency exists after application of the
amounts specified in the corresponding sections of
the related Series Supplements, (3) to the extent any
Series 1998-1 Controlled Distribution Amount
Deficiency exists after application of the amount
specified in clauses (1) and (2) of this subsection,
the Master Servicer shall instruct the Trustee to
withdraw, from funds on deposit in the Series 1998-1
Excess Funding Account, an amount equal to the lesser
of (v) the amount on deposit in the Series 1998-1
Excess Funding Account on such Payment Date (after
application of any amounts pursuant to Section 4.9 of
this Supplement) in an amount not to exceed the
Series 1998-1 Available Subordinated Amount at such
time and (w) the remaining amount of the Series
1998-1 Controlled Distribution Amount Deficiency and
deposit such amounts in the Series 1998-1
Distribution Account to be paid, pro
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rata, to the Series 1998-1 Noteholders on account of
the Series 1998-1 Controlled Distribution Amount, and
(4) to the extent any Series 1998-1 Controlled
Distribution Amount Deficiency remains after
application of the amounts specified in clauses (1)
through (3) of this subsection, if amounts have been
drawn on the Series 1998-1 Letter of Credit and
deposited into the Series 1998-1 Collection Account
pursuant to Section 4.14 of this Supplement, or
amounts have been claimed under the Demand Note or
drawn under the Series 1998-1 Letter of Credit in
respect thereof and deposited into the Series 1998-1
Collection Account pursuant to Section 4.14of this
Supplement, the Master Servicer shall instruct the
Trustee to withdraw from the Series 1998-1 Collection
Account on such Payment Date the lesser of (x) the
amount on deposit in the Series 1998-1 Collection
Account representing such draw on the Series 1998-1
Letter of Credit or payment under the Demand Note
(after application of any portion thereof pursuant to
Section 4.9 of this Supplement) and (y) the remaining
amount of the Series 1998-1 Controlled Distribution
Amount Deficiency (if any), and deposit such amount
in the Series 1998-1 Distribution Account to be paid,
pro rata, to the Series 1998-1 Noteholders on account
of the Series 1998-1 Controlled Distribution Amount;
provided, however, that on the final Payment Date for
the Series 1998-1 Notes, the Trustee shall withdraw
from such accounts, as provided above, an amount
which is no greater than the Series 1998-1 Invested
Amount as of such date; provided further, however,
the Invested Amount of all outstanding Series 1998-1
Notes shall be due and payable on the Series 1998-1
Termination Date; and
(iii) Commencing on the first Payment Date
after the commencement of the Series 1998-1 Rapid
Amortization Period, the Trustee shall (1) withdraw
from the Series 1998-1 Collection Account the amount
allocated thereto pursuant to Section 4.7(c)(i)(2) of
this Supplement, (2) to the extent any portion of the
Series 1998-1 Invested Amount still remains unpaid
after application of the amounts specified in clause
(1) above, the Master Servicer shall instruct the
Trustee to withdraw, from funds on deposit in the
related Excess Funding Accounts of any additional
Group II Series of Notes, if any, an amount equal to
the lesser of (x) the aggregate amount on deposit in
such Excess Funding Accounts on such Payment Date
(after application of any such amounts pursuant to
Section 4.9 of the related Series Supplements) in an
amount not to exceed the related Available
Subordinated Amounts at such time and (y) the unpaid
portion of the Series 1998-1 Invested Amount and
deposit such amounts in the Series 1998-1
Distribution Account to be paid, pro rata, to the
Series 1998-1 Noteholders, provided that any such
amounts withdrawn from the Excess Funding Accounts
for the other Group II Series of Notes shall be
applied on a pro rata basis with respect to
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each Group II Series of Notes with respect to which a
deficiency exists, (3) to the extent any portion of
the Series 1998-1 Invested Amount remains unpaid
after application of the amount specified in clauses
(1) and (2), the Master Servicer shall instruct the
Trustee to withdraw, from funds on deposit in the
Series 1998-1 Excess Funding Account, an amount equal
to the lesser of (v) the amount on deposit in the
Series 1998-1 Excess Funding Account on such Payment
Date (after application of any amounts pursuant to
Section 4.9 of this Supplement) in an amount not to
exceed the Series 1998-1 Available Subordinated
Amount at such time and (w) the unpaid portion of the
Series 1998-1 Invested Amount and deposit such amount
in the Series 1998-1 Distribution Account to be paid,
pro rata, to the Series 1998-1 Noteholders, and (4)
to the extent any portion of the Series 1998-1
Invested Amount still remains unpaid after
application of the amounts specified in clauses (1)
through (3) above, if amounts have been drawn on the
Series 1998-1 Letter of Credit and deposited into the
Series 1998-1 Collection Account pursuant to Section
4.14 of this Supplement or amounts have been claimed
under the Demand Note or drawn under the Series
1998-1 Letter of Credit in respect thereof and
deposited into the Series 1998-1 Collection Account
pursuant to Section 4.14 of this Supplement, the
Master Servicer shall instruct the Trustee to
withdraw from the Series 1998-1 Collection Account on
such Payment Date the lesser of (x) the amount on
deposit in the Series 1998-1 Collection Account
representing such draw on the Series 1998-1 Letter of
Credit or payment under the Demand Note (after
application of any portion thereof pursuant to
Section 4.9 of this Supplement) and (y) the excess of
the Series 1998-1 Invested Amount over the amounts
described in clauses (1) through (3) above and
deposit such amounts in the Series 1998-1
Distribution Account to be paid, pro rata, to the
Series 1998-1 Noteholders; provided, however, that on
the final Payment Date for the Series 1998-1 Notes,
the Trustee shall withdraw from the Series 1998-1
Collection Account, as provided above, an aggregate
amount which is no greater than the Series 1998-1
Invested Amount as of such date. The Series 1998-1
Invested Amount shall be due and payable on the
Series 1998-1 Termination Date.
(iv) On each Payment Date occurring on or
after the date a withdrawal is made pursuant to
Sections 4.10(a)(ii) and (iii) of this Supplement,
the Trustee shall, in accordance with Section 5.1 of
the Base Indenture and the Master Servicer's most
recent Monthly Certificate pay to the applicable
Series 1998-1 Noteholders specified in Section
4.10(a)(ii) or (iii), as applicable, pro rata, the
amount deposited in the Series 1998-1 Distribution
Account for the payment of principal pursuant to
Sections 4.10(a)(ii) and (iii), as applicable, of
this Supplement.
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(b) Decreases. On the Business Day occurring on the
date a withdrawal is made pursuant to Section 4.7(a)(i)(2), the Paying
Agent shall pay to the Trustee for the benefit of the Series 1998-1
Noteholders the amount deposited in the Series 1998-1 Distribution
Account for the payment of principal pursuant to Section 4.7(a)(i)(2).
Section 4.11 Retained Distribution Account. On each
Payment Date, the Master Servicer shall, as applicable, instruct the
Trustee in writing to instruct the Paying Agent to transfer to the
Retained Distribution Account (established pursuant to Section 4.1(b)
of the Base Indenture) (i) all funds which are in the Collection
Account that have been allocated to the Retained Distribution Account
as of such Payment Date and (ii) all funds that were previously
allocated to the Retained Distribution Account but not transferred to
the Retained Distribution Account.
Section 4.12 Series 1998-1 Distribution Account.
(a) Establishment of Series 1998-1 Distribution
Account. The Trustee shall establish and maintain in the name of the
Trustee for the benefit of the Series 1998-1 Noteholders, or cause to
be established and maintained, an account (the "Series 1998-1
Distribution Account"), bearing a designation clearly indicating that
the funds deposited therein are held for the benefit of the Series
1998-1 Noteholders. The Series 1998-1 Distribution Account shall be
maintained (i) with a Qualified Institution, or (ii) as a segregated
trust account with the corporate trust department of a depository
institution or trust company having corporate trust powers and acting
as trustee for funds deposited in the Series 1998-1 Distribution
Account. If the Series 1998-1 Distribution Account is not maintained
in accordance with the previous sentence, the Master Servicer shall
establish a new Series 1998-1 Distribution Account, within ten (10)
Business Days after obtaining knowledge of such fact, which complies
with such sentence, and shall instruct the Trustee to transfer all
cash and investments from the non-qualifying Series 1998-1
Distribution Account into the new Series 1998-1 Distribution Account.
Initially, the Series 1998-1 Distribution Account will be established
with the Trustee.
(b) Administration of the Series 1998-1 Distribution
Account. The Master Servicer shall instruct the institution
maintaining the Series 1998-1 Distribution Account in writing to
invest funds on deposit in the Series 1998-1 Distribution Account at
all times in Permitted Investments; provided, however, that any such
investment shall mature not later than the Business Day prior to the
Payment Date following the date on which such funds were received,
unless any Permitted Investment held in the Series 1998-1 Distribution
Account is held with the Trustee, in which case such investment may
mature on such Payment Date provided that such funds shall be
available for withdrawal on or prior to such Payment Date. The
Trustee shall hold, for the benefit of the Series 1998-1 Noteholders,
possession of any negotiable instruments or securities evidencing the
Permitted Investments from the time of purchase thereof until the time
of maturity.
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(c) Earnings from Series 1998-1 Distribution
Account. Subject to the restrictions set forth above, the Master
Servicer shall have the authority to instruct the Trustee in writing
with respect to the investment of funds on deposit in the Series
1998-1 Distribution Account. All interest and earnings (net of losses
and investment expenses) on funds on deposit in the Series 1998-1
Distribution Account shall be deemed to be on deposit and available
for distribution.
(d) Series 1998-1 Distribution Account Constitutes
Additional Collateral for Series 1998-1 Notes. In order to secure and
provide for the payment of the RCFC Obligations with respect to the
Series 1998-1 Notes (but not the other Notes), RCFC hereby assigns,
pledges, grants, transfers and sets over to the Trustee, for the
benefit of the Series 1998-1 Noteholders, all of RCFC's right, title
and interest in and to the following (whether now or hereafter
existing and whether now owned or hereafter acquired): (i) the Series
1998-1 Distribution Account; (ii) all funds on deposit therein from
time to time; (iii) all certificates and instruments, if any,
representing or evidencing any or all of the Series 1998-1
Distribution Account or the funds on deposit therein from time to
time; (iv) all Permitted Investments made at any time and from time to
time with monies in the Series 1998-1 Distribution Account; and (v)
all proceeds of any and all of the foregoing, including, without
limitation, cash (the items in the foregoing clauses (i) through (v)
are referred to, collectively, as the "Series 1998-1 Distribution
Account Collateral"). The Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Series
1998-1 Distribution Account and in all proceeds thereof. The Series
1998-1 Distribution Account Collateral shall be under the sole
dominion and control of the Trustee, in each case for the benefit of
the Series 1998-1 Noteholders.
Section 4.13 The Servicer's Failure to Instruct the
Trustee to Make a Deposit or Payment. If the Master Servicer fails to
give notice or instructions to make any payment from or deposit into
the Collection Account required to be given by the Master Servicer, at
the time specified in the Master Lease or any other Related Document
(including applicable grace periods), and such failure is known by the
Trustee, the Trustee shall make such payment or deposit into or from
the Collection Account without such notice or instruction from the
Master Servicer if and to the extent that the Trustee has been
furnished information adequate, in the sole discretion of the Trustee,
to determine the amounts and beneficiaries of such payments. Pursuant
to the Master Lease, the Master Servicer has agreed that it shall,
upon request of the Trustee, promptly provide the Trustee with all
information necessary to allow the Trustee to make such a payment or
deposit.
Section 4.14 Draws on Series 1998-1 Letter of Credit.
(a) At or before 10:00 a.m. (New York City time) on
each Payment Date, the Master Servicer shall notify the Trustee and
the Enhancement Agent of the amount of the Series 1998-1 Lease Payment
Losses, such notification to be in the form of Exhibit D to this
Supplement.
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(b) So long as the Series 1998-1 Letter of Credit
shall not have been terminated, on any Business Day that there are
Series 1998-1 Lease Payment Losses, the Enhancement Agent shall, by
1:00 p.m. (New York City time) on the same Business Day, draw on the
Series 1998-1 Letter of Credit for deposit directly to the Series
1998-1 Collection Account by presenting a draft in an amount equal to
the lesser of (i) the Series 1998-1 Lease Payment Losses allocated to
making a drawing under the Series 1998-1 Letter of Credit pursuant to
Sections 4.7(a)(v)(1), (b)(v)(1) or (c)(v)(1) of this Supplement, and
(ii) the amount available to be drawn on the Series 1998-1 Letter of
Credit on such Business Day accompanied by a Certificate of Credit
Demand in the form of Annex A to the Series 1998-1 Letter of Credit.
The proceeds of such draw shall be deposited as soon as practicable in
the Series 1998-1 Collection Account for further allocation to the
Series 1998-1 Distribution Account in accordance with the instructions
of the Master Servicer.
(c) So long as the Series 1998-1 Letter of Credit
shall not have been terminated, on any Business Day that the
Enhancement Agent has received written notice from the Collateral
Agent pursuant to Section 5.05(b) of the Collateral Agreement
notifying the Enhancement Agent of the existence and amount of a
Liquidity Deficiency and directing the Enhancement Agent to make a
draw under the Series 1998-1 Letter of Credit, the Enhancement Agent
shall, by 1:00 p.m. (New York City time) on the date of such notice
(or, in the case of any notice given to the Enhancement Agent after
12:00 noon (New York City time), by 1:00 p.m. (New York City time) on
the next following Business Day), draw on the Series 1998-1 Letter of
Credit by presenting a draft in an amount equal to the lesser of (i)
such Liquidity Deficiency and (ii) the full amount available to be
drawn under the Series 1998-1 Letter of Credit on such date
accompanied by a Certificate of Liquidity Demand in the form of Annex
B to the Series 1998-1 Letter of Credit. The Enhancement Agent shall
deliver the proceeds of such draw to the Trustee for deposit in the
Series 1998-1 Distribution Account.
Section 4.15 Draw on the Demand Note.
(a) On each Determination Date, the Master Servicer shall
determine the aggregate amount, if any, of Losses that have occurred during the
Related Month. In the event that any such Losses occurring during such Related
Month exceed the amount of Recoveries received during such Related Month, the
Master Servicer shall set forth the aggregate amount of such net Losses in the
Monthly Report, and the Trustee shall make in accordance with the written
instructions of the Master Servicer the allocations as set forth in Sections
4.7(a)(iii)(1),(b)(iii)(1) and (c)(iii)(1), as applicable, of this Supplement.
If any amounts are allocated to a claim under the Demand Note pursuant to such
Sections (any such amounts, "Demand Note Claim Amounts"), the Trustee shall
transmit to the issuer of the Demand Note a demand for repayment (each, a
"Demand Notice") under the Demand Note in the amount of the lesser of (x) the
outstanding amount of such Demand Note and (y) the Demand Note Claim Amounts,
in each case such payment to be made on or prior to the next succeeding Payment
Date by deposit of funds into the Series 1998-1 Collection Amount in the
specified amount.
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(b) In the event that on or prior to 10:00 a.m. (New York
City time) on the Payment Date next succeeding any Determination Date on which
a Demand Notice has been transmitted to the issuer of the Demand Note pursuant
to Section 4.15(a) above, the Demand Note issuer shall have failed to deposit
into the Series 1998-1 Collection Account the amount specified in such Demand
Notice, so long as the Series 1998-1 Letter of Credit shall not have been
terminated, the Enhancement Agent shall, by 1:00 p.m. (New York City time) on
the same Business Day, draw on the Series 1998-1 Letter of Credit by presenting
a draft in an amount equal to that portion of the amount demanded under the
Demand Note as specified in (a) above that has not been deposited into the
Series 1998-1 Collection Account as of 10:00 a.m. (New York City time),
accompanied by a Certificate of Credit Demand in the form of Annex A to the
Series 1998-1 Letter of Credit. The proceeds of such draw shall be deposited
in the Series 1998-1 Collection Account for application pursuant to Section
4.10(a)(ii) of this Supplement.
(c) Demand Note Constitutes Additional Collateral for Series
1998-1 Notes. In order to secure and provide for the payment of the RCFC
Obligations with respect to the Series 1998-1 Notes (but not the other Notes),
RCFC hereby assigns, pledges, grants, transfers and sets over to the Trustee,
for the benefit of the Series 1998-1 Noteholders, all of RCFC's right, title
and interest in and to the Demand Note and all proceeds thereof. The Trustee
shall possess all right, title and interest in the Demand Note, all rights to
make claims thereunder and all payments thereon and all proceeds thereof.
Section 4.16 Series 1998-1 Letter of Credit
Termination Demand.
(a) If prior to the date which is 30 days prior to
the then scheduled Series 1998-1 Letter of Credit Expiration Date,
(i) the Series 1998-1 Letter of Credit shall not
have been extended or there shall not have been appointed a
successor institution to act as Series 1998-1 Letter of Credit
Provider, and
(ii) the payments to be made by the Lessees under
the Master Lease shall not have otherwise been credit enhanced
with (A) the funding of the Series 1998-1 Cash Collateral
Account with cash in the amount of the Series 1998-1 Letter of
Credit Amount, (B) other cash collateral accounts,
overcollateralization or subordinated securities or (C) with
the consent of the Required Noteholders, a surety bond or
other similar arrangements; provided, however, that
(1) any such successor institution or other
form of substitute credit enhancement referred to in
the foregoing clauses (B) and (C) shall be approved
by each Rating Agency; and
(2) any such successor institution or other
form of substitute credit enhancement referred to in
the foregoing clauses (i) or (ii)(C) shall, if the
ratings with respect to such substitute credit
enhancement, if applicable,
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are less than A-1 or the equivalent from Standard &
Poor's, P-1 or the equivalent from Moody's and, if
rated by DCR, D-1 or the equivalent by DCR, be
approved by the Required Noteholders;
then the Master Servicer shall notify the Trustee and the Enhancement
Agent in writing pursuant to the Master Lease no later than one
Business Day prior to the Series 1998-1 Letter of Credit Expiration
Date of (i) the principal balance of all Outstanding Series 1998-1
Notes on such date, and (ii) the amount available to be drawn on the
Series 1998-1 Letter of Credit on such date. Upon receipt of such
notice by the Trustee and the Enhancement Agent on or prior to 10:00
a.m. (New York City time) on any Business Day, the Enhancement Agent
shall, by 1:00 p.m. (New York City time) on such Business Day (or, in
the case of any notice given to the Trustee after 10:00 a.m. (New York
City time), by 1:00 p.m. (New York City time) on the next following
Business Day), draw the lesser of the amounts set forth in clauses (i)
and (ii) above on the Series 1998-1 Letter of Credit by presenting a
draft accompanied by a Certificate of Termination Demand in the form
of Annex B to the Series 1998-1 Letter of Credit and shall deposit the
proceeds of the disbursement resulting therefrom in a special deposit
account (the "Series 1998-1 Cash Collateral Account").
(b) The Master Servicer shall notify the Trustee and
the Enhancement Agent in writing pursuant to the Master Lease within
one Business Day of the Master Servicer's becoming aware that the
short-term debt credit rating of the Series 1998-1 Letter of Credit
Provider has fallen below "A-1" as determined by Standard & Poor's,
"P-1" as determined by Moody's or, if rated by DCR, "D-1" as
determined by DCR. At such time the Master Servicer shall also notify
the Trustee and the Enhancement Agent of (i) the principal balance of
all Outstanding Series 1998-1 Notes on such date, and (ii) the Series
1998-1 Letter of Credit Amount on such date. Upon the 60th Business
Day following receipt of such notice by the Trustee and the
Enhancement Agent if the condition described in the first sentence of
this Section 4.16(b) shall remain in effect on or prior to 10:00 a.m.
(New York City time) on any Business Day, the Enhancement Agent shall,
by 1:00 p.m. (New York City time) on such Business Day (or, in the
case of any notice given to the Enhancement Agent after 10:00 a.m.
(New York City time), by 1:00 p.m. (New York City time) on the next
following Business Day), draw on the Series 1998-1 Letter of Credit in
an amount equal to the lesser of the principal balance of all
Outstanding Series 1998-1 Notes on such Business Day and the amount
available to be drawn on the Series 1998-1 Letter of Credit on such
Business Day by presenting a draft accompanied by a Certificate of
Termination Demand in the form of Annex B to the Series 1998-1 Letter
of Credit and shall deposit the proceeds of the disbursement resulting
therefrom in the Series 1998-1 Cash Collateral Account.
Section 4.17 Conversion. If on any Business Day there exists
Series 1998-1 Lease Payment Losses, including after an LOC Termination
Disbursement (as defined in the Liquidity Agreement) has been made as provided
in Section 4.16 above, and if on such day (i) the amount of such Series 1998-1
Lease Payment Losses exceeds the Series 1998-1 Letter of
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Credit Amount on such day, and (ii) LOC Liquidity Disbursements (as defined in
the Liquidity Agreement) are Outstanding (as defined in the Liquidity
Agreement), then (A) such amount of LOC Liquidity Disbursements (as defined in
the Liquidity Agreement) shall be reduced, and (B) the amount of LOC Credit
Disbursements (as defined in the Liquidity Agreement) Outstanding shall be
increased, in each case, by an amount equal to the lesser of (a) the amount by
which the Series 1998-1 Lease Payment Losses exceeds the Series 1998-1 Letter
of Credit Amount (which Series 1998-1 Letter of Credit Amount shall, in any
event, be drawn, in accordance with the second paragraph of Section 4.14 as a
Credit Draw) and (b) the aggregate amount of LOC Liquidity Disbursements (such
reduction and increase shall be referred to as a "Conversion"). On the
Business Day any such Conversion is required, the Enhancement Agent (upon
receiving written notice of such Series 1998-1 Lease Payment Losses from the
Master Servicer) shall direct the Trustee to deliver to the Series 1998-1
Letter of Credit Provider a Notice of Conversion in the form of Exhibit B to
the CP Enhancement Letter of Credit Application and Agreement by 1:00 p.m. (New
York City time) on such Business Day.
Section 4.18 The Series 1998-1 Cash Collateral
Account.
(a) Upon receipt of written notice of a draw on the
Series 1998-1 Letter of Credit from the Enhancement Agent pursuant to
Section 4.14, the Trustee shall establish and maintain in the name of
the Trustee for the benefit of the Series 1998-1 Noteholders, or cause
to be established and maintained, the Series 1998-1 Cash Collateral
Account bearing a designation clearly indicating that the funds
deposited therein are held for the Series 1998-1 Noteholders. The
Series 1998-1 Cash Collateral Account shall be maintained (i) with a
Qualified Institution, or (ii) as a segregated trust account with the
corporate trust department of a depository institution or trust
company having corporate trust powers and acting as trustee for funds
deposited in the Series 1998-1 Cash Collateral Account. If the Series
1998-1 Cash Collateral Account is not maintained in accordance with
the prior sentence, then within 10 Business Days after obtaining
knowledge of such fact, the Master Servicer has agreed pursuant to the
Master Lease that it shall establish a new Series 1998-1 Cash
Collateral Account which complies with such sentence and shall
instruct the Trustee in writing to transfer into the new Series 1998-1
Cash Collateral Account all cash and investments from the
non-qualifying Series 1998-1 Cash Collateral Account. When
established, the Series 1998-1 Cash Collateral Account is intended to
function in all respects as the replacement for, and the equivalent
of, the Series 1998-1 Letter of Credit. Accordingly, following its
creation, each reference to a draw on the Series 1998-1 Letter of
Credit shall refer to withdrawals from the Series 1998-1 Cash
Collateral Account and references to similar terms shall mean and be a
reference to actions taken with respect to the Series 1998-1 Cash
Collateral Account that correspond to actions that otherwise would
have been taken with respect to the Series 1998-1 Letter of Credit.
Without limiting the generality of the foregoing, upon funding of the
Series 1998-1 Cash Collateral Account, the Trustee shall, at all times
when the Enhancement Agent is otherwise required to make a draw under
the Series 1998-1 Letter of Credit pursuant to Section 4.14 or 4.16 of
this Supplement, make a draw from the Series 1998-1 Cash Collateral
Account in the amount and at such time as a draw would be made under
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the Series 1998-1 Letter of Credit pursuant to Section 4.14 or 4.16 of
this Supplement. The Trustee shall provide written notice to DTAG of
any draw from the Series 1998-1 Cash Collateral Account pursuant to
Section 4.14 or 4.16 of this Supplement.
(b) In order to secure and provide for the repayment
and payment of the obligations of RCFC with respect to the Series
1998-1 Notes (but not any other Series of Notes), RCFC hereby assigns,
pledges, grants, transfers and sets over to the Trustee, for the
benefit of the Series 1998-1 Noteholders, all of RCFC's right, title
and interest in and to the following (whether now or hereafter
existing and whether now owned or hereafter acquired): (i) the Series
1998-1 Cash Collateral Account; (ii) all funds on deposit therein from
time to time; (iii) all certificates and instruments, if any,
representing or evidencing any or all of the Series 1998-1 Cash
Collateral Account or the funds on deposit therein from time to time;
(iv) all Permitted Investments made at any time and from time to time
with the monies in the Series 1998-1 Cash Collateral Account; and (v)
all proceeds of any and all of the foregoing, including, without
limitation, cash. The Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Series
1998-1 Cash Collateral Account and in all proceeds thereof. The
Series 1998-1 Cash Collateral Account shall be under the sole dominion
and control of the Trustee for the benefit of the Series 1998-1
Noteholders and the Series 1998-1 Letter of Credit Provider, as their
interests appear herein, which interest in the case of the Series
1998-1 Letter of Credit Provider shall be subject to the interests of
the holders of Series 1998-1 Notes as provided herein.
(c) Funds on deposit in the Series 1998-1 Cash
Collateral Account shall, at the written direction of the Master
Servicer given pursuant to the Master Lease, be invested by the
Trustee in Permitted Investments subject to the right of the Liquidity
Agent pursuant to Section 5.04 of the Collateral Agreement to direct
the investment of such amounts so long as a Liquidity Agreement
Amortization Event (other than Scheduled Liquidity Agreement
Amortization Events) shall have occurred and be continuing. Funds on
deposit in the Series 1998-1 Cash Collateral Account on any Payment
Date, after giving effect to any deposits to or withdrawals from the
Series 1998-1 Cash Collateral Account on such Payment Date, shall be
invested in Permitted Investments that will mature at such time that
such funds will be available for withdrawal on or prior to the
following Payment Date. The proceeds of any such investment, to the
extent not distributed on such Payment Date, shall be invested in
Permitted Investments that will mature at such time that such funds
will be available for withdrawal on or prior to the Payment Date
immediately following the date of such investment. The Trustee shall
maintain for the benefit of the Series 1998-1 Noteholders and the
Series 1998-1 Letter of Credit Provider as their interests appear
herein, which interest in the case of the Series 1998-1 Letter of
Credit Provider shall be subject to the interests of the holders of
the Series 1998-1 Notes as provided herein, possession of the
negotiable instruments or securities evidencing the Permitted
Investments from the time of purchase thereof until the time of sale
or maturity. On each Payment Date, all interest and earnings (net of
losses and investment expenses) accrued since the preceding Payment
Date on funds on
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<PAGE> 71
deposit in the Series 1998-1 Cash Collateral Account shall be paid to
the Series 1998-1 Letter of Credit Provider to the extent of any
unreimbursed draws on the Series 1998-1 Letter of Credit. Subject to
the restrictions set forth above, the Master Servicer, or a Person
designated in writing by the Master Servicer with written notification
thereof to the Trustee, shall have the authority to instruct the
Trustee in writing with respect to the investment of funds on deposit
in the Series 1998-1 Cash Collateral Account. For purposes of
determining the availability of funds or the balances in the Series
1998-1 Cash Collateral Account for any reason under the Indenture, all
investment earnings on such funds shall be deemed not to be available
or on deposit.
(d) Series 1998-1 Cash Collateral Account Surplus.
In the event that the Series 1998-1 Cash Collateral Account Surplus on
any Payment Date, after giving effect to all withdrawals from the
Series 1998-1 Cash Collateral Account, is greater than zero, the
Trustee, acting in accordance with the written instructions of the
Servicer, shall withdraw from the Series 1998-1 Cash Collateral
Account an amount equal to the Series 1998-1 Cash Collateral Amount
Surplus and shall pay from such amount to the Series 1998-1 Letter of
Credit Provider, an amount equal to the amount of unreimbursed draws
under the Series 1998-1 Letter of Credit.
(e) Termination of Series 1998-1 Cash Collateral
Account. Upon the later to occur of (i) the termination of the
Indenture pursuant to Section 10.1 of the Base Indenture and (ii) the
Business Day immediately following the Series 1998-1 Letter of Credit
Expiration Date, the Trustee, acting in accordance with the written
instructions of the Servicer, after the prior payment of all amounts
owing to the Series 1998-1 Noteholders and payable from the Series
1998-1 Cash Collateral Account as provided herein, shall withdraw from
the Series 1998-1 Cash Collateral Account all amounts on deposit
therein for payment to the Series 1998-1 Letter of Credit Provider to
the extent of unreimbursed draws on the Series 1998-1 Letter of
Credit.
Section 4.19. Appointment of Enhancement Agent. Bankers Trust Company
is hereby appointed to act as Enhancement Agent in respect of the Series 1998-1
Letter of Credit and Bankers Trust Company hereby accepts such appointment and
agrees to hold the Series 1998-1 Letter of Credit as beneficiary on behalf of
the Trustee and the Collateral Agent pursuant to the terms hereof and to make
draws thereon pursuant to the terms of the Series 1998-1 Letter of Credit, this
Supplement and the Collateral Agreement. The Enhancement Agent shall promptly
follow the instructions of either the Trustee or the Collateral Agent to make a
claim under the Series 1998-1 Letter of Credit or withdrawal from the Series
1998-1 Cash Collateral Account. The Enhancement Agent shall have all the
rights of the Trustee under Sections 9.2 and 9.3 of the Base Indenture. The
Enhancement Agent hereby acknowledges and agrees to perform the duties set
forth with respect to the Enhancement Agent in Sections 2.1(a), 2.1(e), 2.1(f),
2.3(a) and 2.3(c) of the CP Enhancement Letter of Credit Application and
Agreement including, without limitation, its obligation to execute and deliver
a Notice of Reduction of Series 1998-1 Letter of Credit Amount substantially in
the form attached as Annex E to the Series 1998-1 Letter of Credit upon its
receipt of a Request for Reduction of Series 1998-1 Letter of Credit Amount in
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<PAGE> 72
substantially the form attached as Exhibit D to the CP Enhancement Letter of
Credit Application and Agreement. Notwithstanding anything to the contrary
contained in this Supplement or the Base Indenture, (i) the Master Servicer
shall be solely responsible for payment of the fees of the Enhancement Agent
and such fees shall not be paid out of the fees otherwise payable to the
Trustee, (ii) the Servicers, jointly and severally, shall indemnify the
Enhancement Agent (which for purposes of this Section 4.19 shall include its
officers, directors and employees) to the same extent as the Servicers'
indemnification of the Trustee pursuant to Section 15.2 of the Master Lease and
(iii) the Trustee shall not be responsible for the acts or omissions of the
Enhancement Agent.
ARTICLE 5.
AMORTIZATION EVENTS
Section 5.1 Series 1998-1 Amortization Events. In addition
to the Amortization Events set forth in Section 8.1 of the Base Indenture, the
following shall be Amortization Events with respect to the Series 1998-1 Notes
(without notice or other action on the part of the Trustee or any Series 1998-1
Noteholders):
(a) a Series 1998-1 Enhancement Deficiency shall occur and
continue for at least five (5) Business Days after the Master Servicer
obtains actual knowledge thereof; provided, however, that such event
or condition shall not be an Amortization Event if (i) during such
five (5) Business Day period DTAG shall have increased the Series
1998-1 Letter of Credit Amount or RCFC shall have increased the Series
1998-1 Available Subordinated Amount by allocating to the Series
1998-1 Available Subordinated Amount, Eligible Vehicles theretofore
allocated to the Retained Interest or by depositing funds into the
Series 1998-1 Excess Funding Account, in either case so that the
Series 1998-1 Enhancement Deficiency no longer exists, and (ii) any
increase in the Series 1998-1 Available Subordinated Amount pursuant
to clause (i) of this Section 5.1(a) shall be in accordance with the
terms of Section 4.7(d)(v) of this Supplement;
(b) the Series 1998-1 Letter of Credit shall not be in full
force and effect and no substitute credit enhancement shall have been
obtained pursuant to the CP Enhancement Letter of Credit Application
and Agreement unless (i) the inclusion of the Series 1998-1 Letter of
Credit Amount in the Enhancement Amount is not necessary for the
Enhancement Amount to equal or exceed the Minimum Enhancement Amount,
or (ii) the Series 1998-1 Cash Collateral Account shall theretofore
have been funded to the full extent required hereunder;
(c) from and after the funding of the Series 1998-1 Cash
Collateral Account pursuant to Section 4.14 or 4.16 of this
Supplement, the Series 1998-1 Cash Collateral Account shall be subject
to an injunction, estoppel or other stay or a Lien (other than the
Lien of the Trustee under the Indenture);
-68-
<PAGE> 73
(d) an Event of Bankruptcy shall have occurred with
respect to the Series 1998-1 Letter of Credit Provider or the Series
1998-1 Letter of Credit Provider repudiates the Series 1998-1 Letter
of Credit or refuses to honor a proper draw thereon in accordance with
the terms thereof, unless (i) the inclusion of the Series 1998-1
Letter of Credit Amount in the Enhancement Amount is not necessary for
the Enhancement Amount to equal or exceed the Minimum Enhancement
Amount, or (ii) the Series 1998-1 Cash Collateral Account shall
theretofore have been funded to the full extent required hereunder and
under the CP Enhancement Letter of Credit Application and Agreement;
(e) any of the Related Documents or any portion thereof shall
not be in full force and effect or enforceable in accordance with its
terms or RCFC, DTAG (including in its capacity as Master Servicer),
Thrifty (including in its capacity as a Servicer) or Dollar (including
in its capacity as a Servicer) or any successor to Thrifty or Dollar
in their respective capacities as Servicers shall so assert in
writing;
(f) all principal and accrued interest of the Series 1998-1
Notes shall not be paid in full on or before the Series 1998-1
Expected Final Payment Date; or
(g) an event of default shall have occurred and be continuing
under the Master Lease; or
(h) a Liquidity Agreement Amortization Event occurs under the
Master Lease.
In the case of any event described in clauses (b) through (g)
above, an Amortization Event will be deemed to have occurred with respect to
the Series 1998-1 Notes only if, after any applicable grace period described in
such clauses, either the Trustee, by written notice to the Issuer, or the
Series 1998-1 Noteholders, by written notice to the Issuer and the Trustee,
declare that, as of the date of such notice, an Amortization Event has
occurred.
Section 5.2 Waiver of Past Events. Subject to Section 11.2
of the Base Indenture, Series 1998-1 Noteholders holding 100% of the Series
1998-1 Invested Amount, by written notice to the Trustee, may waive any
existing Potential Amortization Event or Amortization Event related to clause
(a) of Section 5.1 of this Supplement.
ARTICLE 6.
COVENANTS
Section 6.1 Minimum Subordinated Amount. RCFC shall maintain
the Series 1998-1 Available Subordinated Amount in an amount greater than or
equal to the Minimum Subordinated Amount.
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<PAGE> 74
Section 6.2 Minimum Letter of Credit Amount. RCFC shall
maintain the Series 1998-1 Letter of Credit Amount in an amount greater than or
equal to the Minimum Letter of Credit Amount.
ARTICLE 7.
FORM OF SERIES 1998-1 NOTES
Series 1998-1 Notes will be issued in fully registered form,
substantially in the form set forth in Exhibit A to this Supplement, with such
legends as may be applicable thereto as set forth in the Base Indenture, and
will be sold initially to the Series 1998-1 Note Purchaser and shall be duly
executed by the Issuer and authenticated by the Trustee in the manner set forth
in Section 2.4 of the Base Indenture. The Series 1998-1 Notes are not
permitted to be transferred, assigned, exchanged or otherwise pledged or
conveyed except in compliance with the terms of the Base Indenture. The Series
1998-1 Notes shall bear a face amount equal to the Series 1998-1 Maximum
Invested Amount, and shall be initially issued in a principal amount equal to
the Series 1998-1 Initial Invested Amount. The Trustee shall, or shall cause
the Note Registrar to, record any Increases or Decreases with respect to the
Series 1998-1 Invested Amount such that the principal amount of the Series
1998-1 Notes Outstanding accurately reflects all such Increases and Decreases.
ARTICLE 8.
GENERAL
Section 8.1 Payment of Rating Agencies' Fees. RCFC agrees
and covenants with the Master Servicer and the Trustee to pay all reasonable
fees and expenses of the Rating Agencies and to promptly provide all documents
and other information that the Rating Agencies may reasonably request.
Section 8.2 Exhibits. The following exhibits attached hereto
supplement the exhibits included in the Indenture.
Exhibit A: Form of Series 1998-1 Note
Exhibit B: Reserved
Exhibit C: Form of Demand Note
Exhibit D: Form of Notice of Series 1998-1 Lease
Payment Losses
Section 8.3 Ratification of Base Indenture. As supplemented
by this Supplement and except as specified in this Supplement, the Base
Indenture is in all respects ratified and confirmed and the Base Indenture as
so supplemented by this Series Supplement shall be read,
-70-
<PAGE> 75
taken, and construed as one and the same instrument. In this regard, for the
purposes of the terms and conditions governing the Series 1998-1 Notes and the
Group II Collateral, Section 7.28 of the Base Indenture shall not apply.
Section 8.4 Counterparts. This Supplement may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original, but all of such counterparts shall together constitute but one and
the same instrument.
Section 8.5 Governing Law. THIS SUPPLEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAW (INCLUDING, WITHOUT LIMITATION, THE UCC)
OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE PROVISIONS THEREOF
REGARDING CONFLICTS OF LAWS), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HERETO SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAW.
Section 8.6 Amendments. This Supplement may be modified or
amended from time to time in accordance with the terms of the Base Indenture;
provided, however, that if, pursuant to the terms of the Base Indenture or this
Supplement, the consent of the Required Noteholders is required for an
amendment or modification of this Supplement, such requirement shall be
satisfied if such amendment or modification is consented to by Noteholders
representing more than 50% of the Aggregate Principal Balance of the Series
1998-1 Notes affected thereby (including for purposes of determining such
aggregate outstanding principal amount, the Aggregate Principal Balance of the
Series 1998-1 Notes). In addition, this Supplement may be amended or modified
from time to time, without the consent of any Noteholder but with the consent
of RCFC, DTAG and the Trustee and written confirmation of the then current
ratings on the Series 1998-1 Notes from the Rating Agencies to amend the
following definitions: "Maximum Manufacturer Percentage", "Measurement Month",
"Measurement Month Average" and "Market Value Adjustment Percentage" and to
make changes related to such amendments.
[Remainder of Page Intentionally Blank]
-71-
<PAGE> 76
IN WITNESS WHEREOF, the parties hereto have caused this Supplement to
be duly executed by their respective officers thereunto duly authorized as of
the day and year first above written.
RENTAL CAR FINANCE CORP.
By:
-----------------------------------
Name:
Title:
BANKERS TRUST COMPANY, as Trustee and
Enhancement Agent
By:
-----------------------------------
Name:
Title:
Accepted and Acknowledged by:
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.,
as Master Servicer
By:
----------------------------
Name:
Title:
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<PAGE> 77
SCHEDULE 1
Schedule of Maximum Manufacturer Percentages
<TABLE>
<CAPTION>
Manufacturer Program Vehicles Non-Program Vehicles
- ------------ ---------------- --------------------
<S> <C> <C>
Mazda N/A *
Chrysler 100% *
Ford 100% *
Toyota 100% *
General Motors N/A *
Honda N/A *
Nissan N/A *
</TABLE>
* Non-Program Vehicles not to exceed 20% in the aggregate.
<PAGE> 78
EXHIBIT A
Form of Series 1998-1 Note
<PAGE> 79
EXHIBIT B
[Reserved]
<PAGE> 80
EXHIBIT C
Form of Demand Note
New York, New York
March 4, 1998
FOR VALUE RECEIVED, the undersigned, DOLLAR THRIFTY AUTOMOTIVE
GROUP, INC., a Delaware corporation ("DTAG"), promises to pay to RENTAL CAR
FINANCE CORP., an Oklahoma corporation ("RCFC"), on demand (the "Demand Date"),
(a) the principal sum of [ ] or (b) such other amount, shown on
Schedule A attached hereto (and any continuation thereof) made by RCFC, as the
aggregate unpaid principal balance hereof, including the aggregate unpaid
principal amount of Demand Note Advances (as defined herein) made from funds on
deposit in the Series 1998-1 Collection Account from time to time.
1. Principal Payment Date. Any unpaid principal of this
promissory note (this "Demand Note") shall be paid on the Demand Date.
2. Interest. DTAG also promises to pay interest on the unpaid
principal amount hereof from time to time outstanding at an interest rate of
one-year LIBOR, as determined for such period in the manner set forth under the
Base Indenture, dated as of December 13, 1995 between RCFC and Bankers Trust,
as Trustee (the "Base Indenture") as supplemented by the Series 1998-1
Supplement (the "Series 1998-1 Supplement" and together with the Base
Indenture, the "Indenture") for the determination of LIBOR thereunder, plus
1.5% (the "Demand Note Rate")from the date hereof until the principal amount
shall be paid in full. Capitalized terms used herein and not otherwise defined
herein shall have the meanings set forth therefor in the Indenture.
3. Prepayments. The DTAG shall repay in full the unpaid
principal amount of the Demand Note upon the Demand Date hereof. Prior
thereto, the DTAG:
(a) may, from time to time on any Business Day, make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of this
Demand Note; provided, however, that
(i) any such prepayment shall be made after all payments due on
such Business Day under the Related Documents have been paid in full;
(ii) no Event of Default or Lease Event of Default shall have
occurred and be continuing; and
<PAGE> 81
(iii) such voluntary prepayments shall require at least three but no
more than five Business Days' prior written notice to RCFC.
Each prepayment of any Demand Note made pursuant to this Section 3 shall be
without premium or penalty.
4. Demand Note Advances. RCFC agrees to make advances ("Demand
Note Advances") upon request from DTAG as borrower out of and not to exceed in
any Related Month the amount by which Recoveries constituting Profits that may
be lent under this Demand Note pursuant to Sections 4.7(a)(ii)(1),
4.7(b)(ii)(1), and 4.7(c)(ii)(1) of the Series 1998-1 Supplement. Such Demand
Note Advances are repayable by DTAG, with interest, on each Demand Date upon
demand by RCFC or the Trustee, as assignee of RCFC. Demand Note Advances shall
accrue interest on the outstanding balance thereof at the Demand Note Rate then
applicable. The date, amount, interest rate and duration of the Interest Period
(if applicable) of each Demand Note Advance made by RCFC to DTAG and each
payment made on account of the principal thereof, shall be recorded by RCFC on
its books and, prior to any transfer of this Demand Note, endorsed by RCFC on
Schedule A attached hereto or any continuation thereof, provided that the
failure of RCFC to make any such recordation or endorsement shall not affect
the obligations of DTAG to make a payment when due of any amount owing
hereunder or under any other Related Document in respect of the Demand Note
Advances made by RCFC.
5. Subordination.
(a) RCFC, as subordinated lender under this Demand Note in respect
of Demand Note Advances (the "Subordinated Lender") hereby agrees that the
Subordinated Lender's right under this Demand Note is expressly subordinated to
all payment obligations due to the Trustee, as assignee of the Master Lease,
(the "Senior Lender") under the Master Lease (the "Payment Obligations"). The
Subordinated Lender hereby agrees that the payment of this Demand Note is
hereby expressly subordinated, in accordance with the terms hereof, to the
prior payment in full of the Payment Obligations in cash.
(b) Upon the maturity of any Payment Obligation (including
interest thereon or fees or any other amounts owing in respect thereof),
whether on the Payment Date (after any extension thereof), by acceleration or
otherwise, all payments thereof and premium, if any, and interest thereon or
fees or any other amounts owing in respect thereof, in each case to the extent
due and owing, shall first be paid in full in cash, or such payment duly
provided for in cash or in a manner satisfactory to the Senior Lender, before
any payment is made on account of the Demand Note. The Subordinated Lender
hereby agrees that, so long as an Event of Default or a Lease Event of Default,
or event which with notice or lapse of time or both would constitute an Event
of Default or a Lease Event of Default, in respect of any Payment Obligations,
it will not ask, demand, sue for, or otherwise take, accept or receive, any
amounts in respect of this Demand Note.
C-2
<PAGE> 82
(c) In the event that notwithstanding the provisions of the
preceding Section 5(b), DTAG shall make any payment on account of this Demand
Note at a time when payment is not permitted by said Section 5(b), such payment
shall be held by the Subordinated Lender or its representative, in trust for
the benefit of, and shall be paid forthwith over and delivered to, the Senior
Lender or its representative for application to the payment of all Payment
Obligations remaining unpaid to the extent necessary to pay all Payment
Obligations in full in cash in accordance with the terms of the Master Lease,
after giving effect to any concurrent payment or distribution to or for the
Payment Obligations. Without in any way modifying the provisions hereof or
affecting the subordination effected hereby if such notice is not given, DTAG
shall give the Subordinated Lender prompt written notice of any payment made on
the Demand Note and any Demand Date of Payment Obligations after which such
Payment Obligations remain unsatisfied.
(d) Upon any distribution of assets of DTAG upon any dissolution,
winding up, liquidation or reorganization of DTAG (whether in bankruptcy,
insolvency or receivership proceedings or upon an assignment for the benefit of
creditors or otherwise):
(i) the Senior Lender shall first be entitled to receive payment
in full of the Payment Obligations in cash or in a manner satisfactory
to the Senior Lender (including, without limitation, all interest
accruing after the commencement of any bankruptcy, insolvency,
receivership or similar proceeding at the rate provided in the
governing documentation whether or not such interest is an allowed
claim in such proceeding) before the Subordinated Lender is entitled
to receive any payment out of the proceeds from or distributions made
under the Master Lease;
(ii) any payment out of the proceeds from or distributions made
under the Master Lease of any kind or character, whether in cash,
property or securities to which the Subordinated Lender would be
entitled except for the provisions hereof, shall be paid by the
liquidating trustee or agent or other person making such payment or
distribution, whether a trustee or agent, directly to the Senior
Lender or its representative under the agreements pursuant to which
the Payment Obligations may have been made, to the extent necessary to
make payment in full of all Payment Obligations remaining unpaid,
after giving effect to any concurrent payment or distribution to the
Senior Lender in respect of the Payment Obligations; and
(iii) in the event that, notwithstanding the foregoing
provisions of this Section 5(d), any payment of any kind or character,
whether in cash, property or securities, shall be received by the
Subordinated Lender on account of principal of this Demand Note before
all Payment Obligations are paid in full in cash or in a manner
satisfactory to the Senior Lender, or effective provisions made for
its payment, such payment out of the proceeds from or distributions
made under the Master Lease shall be received and held in trust for
and shall be paid over to the Senior Lender in respect of Payment
Obligations remaining unpaid or unprovided for or their representative
under the agreements pursuant to which the Payment Obligations have
been made, for application to the payment of such Payment
C-3
<PAGE> 83
Obligations until all such Payment Obligations shall have been paid in
full in cash or in a manner satisfactory to the Senior Lender, after
giving effect to any concurrent payment or distribution to the Senior
Lender in respect of Payment Obligations.
Without in any way modifying the provisions hereof or affecting the
subordination effected hereby if such notice is not given, DTAG shall give
prompt written notice to the Subordinated Lender of any dissolution, winding
up, liquidation or reorganization of DTAG (whether in bankruptcy, insolvency or
receivership proceedings or upon an assignment for the benefit of creditors or
otherwise).
6. No Waiver; Amendment. No failure or delay on the part of RCFC
in exercising any power or right hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power or right preclude
any other or further exercise thereof or the exercise of any other power or
right. No amendment, modification or waiver of, or consent with respect to,
any provision of this Demand Note shall in any event be effective unless (a)
the same shall be in writing and signed and delivered by DTAG and RCFC, and (b)
all consents required for such actions under the Related Documents shall have
been received by the appropriate Persons.
7. No Negotiation. This Demand Note is not negotiable other than
a pledge or assignment to the Trustee, who is hereby authorized by DTAG and
RCFC to make claims for repayment of principal outstandings hereunder on behalf
of RCFC.
8. Successors and Assigns. This Demand Note shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
permitted successors and assigns.
9. GOVERNING LAW. THIS PROMISSORY NOTE HAS BEEN DELIVERED IN NEW
YORK, NEW YORK AND SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY
THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES.
10. Captions. Paragraph captions used in this Demand Note are
provided solely for convenience of reference only and shall not affect the
meaning or interpretation of any provision of this Demand Note.
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
By
------------------------------------
Name: Steven B. Hildebrand
Title: Vice President
C-4
<PAGE> 84
Accepted and Agreed:
RENTAL CAR FINANCE CORP.
By:
-----------------------------
Name:
Title:
C-5
<PAGE> 85
Schedule A
PAYMENT GRID
<TABLE>
<CAPTION>
================================================================================
AMOUNT OF
AMOUNT OF DEMAND OUTSTANDING NOTATION
PRINCIPAL PRINCIPAL NOTE PRINCIPAL MADE
DATE AMOUNT PAYMENT ADVANCE BALANCE BY
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
</TABLE>
<PAGE> 86
EXHIBIT D
TO SERIES 1998-1 SUPPLEMENT
Form of Notice of
Series 1998-1 Lease Payment Losses
Bankers Trust Company, as Trustee and Enhancement Agent
4 Albany Street, 10th Floor
New York, New York 10006
Ladies and Gentlemen:
This Series 1998-1 Lease Payment Losses Notice is delivered to you
pursuant to Section 4.14 of the Series 1998- 1 Supplement dated as of March 4,
1998 to the Base Indenture dated as of December 13, 1995 (as amended or
modified from to time, the "Series 1998-1 Supplement") between Rental Car
Finance Corp., an Oklahoma corporation, and Bankers Trust Company, as Trustee
and Enhancement Agent. Terms used herein have the meanings provided in the
Series 1998-1 Supplement.
The Master Servicer hereby notifies the Trustee and the Enhancement
Agent that as of _________, 19__ there exists Series 1998-1 Lease Payment
Losses in the amount of $__________.
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
By:
------------------------------------
Name:
Title:
<PAGE> 1
EXHIBIT 4.13
[EXECUTION COPY]
MASTER MOTOR VEHICLE LEASE AND SERVICING AGREEMENT
dated as of March 4, 1998
among
RENTAL CAR FINANCE CORP.
as Lessor,
THRIFTY RENT-A-CAR-SYSTEM, INC.,
as Lessee and Servicer,
DOLLAR RENT A CAR SYSTEMS, INC.,
as Lessee and Servicer,
and those Subsidiaries of
Dollar Thrifty Automotive Group, Inc.
from time to time
becoming Lessees and Servicers hereunder
and
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
as Guarantor and Master Servicer
AS SET FORTH IN SECTION 21 HEREOF, LESSOR HAS ASSIGNED TO THE TRUSTEE (AS
DEFINED HEREIN) ALL OF LESSOR'S RIGHT, TITLE AND INTEREST IN AND TO THIS LEASE.
TO THE EXTENT, IF ANY, THAT THIS LEASE CONSTITUTES CHATTEL PAPER (AS SUCH TERM
IS DEFINED IN THE UNIFORM COMMERCIAL CODE AS IN EFFECT IN ANY APPLICABLE
JURISDICTION), NO SECURITY INTEREST IN THIS LEASE MAY BE CREATED THROUGH THE
TRANSFER OR POSSESSION OF ANY COUNTERPART OTHER THAN THE ORIGINAL EXECUTED
COUNTERPART NO. 1, WHICH SHALL BE IDENTIFIED AS THE COUNTERPART CONTAINING THE
RECEIPT THEREFOR EXECUTED BY THE TRUSTEE ON THE SIGNATURE PAGE THEREOF.
[THIS IS NOT THE ORIGINAL EXECUTED COUNTERPART NO. 1]
[THIS IS THE ORIGINAL EXECUTED COUNTERPART NO. 1
(IF BEARING ORIGINAL SIGNATURES)]
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 1. CERTAIN DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1. Certain Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. Accounting and Financial Determinations . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.3. Cross References; Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.4. Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 2. GENERAL AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.1. Leasing of Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.2. Right of Lessees to Act as Lessor's Agent . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.3. Payment of Purchase Price by Lessor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.4. Non-liability of Lessor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3. TERM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3.1. Vehicle Lease Commencement Date. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3.2. Lease Commencement Date; Lease Expiration Date . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 4. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 4.1. Conditions to Each Lease of Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 4.1.1 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 4.1.2 Limitations of the Acquisition of Certain Vehicles . . . . . . . . . . . . . . . . . . . . . 6
SECTION 5. RENT AND CHARGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 5.1. Payment of Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 5.2. Payment of Availability Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 5.3. Payment of Monthly Supplemental Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 5.4. Payment of Termination Payments, Casualty Payments, and Late Return Payments . . . . . . . . . 9
Section 5.5. Late Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 6. INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 6.1. Fleet Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 6.2. Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 7. CASUALTY OBLIGATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 8. VEHICLE USE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 9. REGISTRATION; LICENSE; TRAFFIC SUMMONSES; PENALTIES AND FINES . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 10. MAINTENANCE AND REPAIRS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
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SECTION 11. VEHICLE WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 12. VEHICLE USAGE REQUIREMENTS AND DISPOSITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 12.1. Usage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 12.2. Disposition Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 12.3. Termination Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 13. LATE RETURN PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 14. REDESIGNATION OF VEHICLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 15. GENERAL INDEMNITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 15.1. Indemnity of the Lessor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 15.2. Indemnification of the Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 15.3. Reimbursement Obligation by the Lessees . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 15.4. Notice to Lessee of Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 15.5. Defense of Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 16. ASSIGNMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 17. DEFAULT AND REMEDIES THEREFOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 17.1. Lease Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 17.2. Effect of Lease Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 17.3. Rights of Lessor Upon Lease Event of Default, Liquidation Event of Default or Limited
Liquidation Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 17.4. Rights of Trustee Upon Liquidation Event of Default, Limited Liquidation Event of Default,
Manufacturer Event of Default and Non-Performance of Certain Covenants . . . . . . . . . 20
Section 17.5. Measure of Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 17.6. Application of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 18. MANUFACTURER EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 19. CERTIFICATION OF TRADE OR BUSINESS USE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 20. SURVIVAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 21. RIGHTS OF LESSOR PLEDGED TO MASTER COLLATERAL AGENT AND TRUSTEE . . . . . . . . . . . . . . . . . . . . 24
SECTION 22. MODIFICATION AND SEVERABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
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SECTION 23. CERTAIN REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 23.1. Due Organization, Authorization, No Conflicts, Etc. . . . . . . . . . . . . . . . . . . . . . 26
Section 23.2. Financial Information; Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 23.3. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 23.4. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 23.5. Necessary Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 23.6. Employee Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 23.7. Investment Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 23.8. Regulations G, T, U and X . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 23.9. Business Locations; Trade Names; Principal Places of Business Locations . . . . . . . . . . . 28
Section 23.10. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 23.11. Governmental Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 23.12. Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 23.13. Eligible Vehicles; Eligible Franchisees . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 23.14. Supplemental Documents True and Correct . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 24. CERTAIN AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 24.1. Corporate Existence; Foreign Qualification . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 24.2. Books, Records and Inspections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 24.3. Vehicle Disposition Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 24.4. Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 24.5. Taxes and Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 24.6. Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 24.7. Maintenance of Separate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 24.8. Master Collateral Agent as Lienholder . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 24.9. Maintenance of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 24.10. Access to Certain Documentation and Information Regarding the Collateral . . . . . . . . . . 36
SECTION 24.11. Maintenance of Credit Enhancement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 24.12. Certain Additional Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 24.13. Minimum Depreciation Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 25. CERTAIN NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 25.1. Mergers, Consolidations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 25.2. Other Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 25.3. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 25.4. Use of Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 26. SERVICING COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 27. GUARANTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 27.1. Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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Section 27.2. Scope of Guarantor's Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 27.3. Lessor's Right to Amend this Lease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 27.4. Waiver of Certain Rights by Guarantor . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 27.5. Lessees' Obligations to Guarantor and Guarantor's Obligations to Lessees Subordinated . . . . 43
Section 27.6. Guarantor to Pay Lessor's Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 27.7. Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 27.8. Pari Passu Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 27.9. Third-Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 28. ADDITIONAL LESSEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 28.1. Additional Lessees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 29. BANKRUPTCY PETITION AGAINST LESSOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 30. SUBMISSION TO JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 31. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 32. JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 33. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 34. HEADINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 35. EXECUTION IN COUNTERPARTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 36. EFFECTIVENESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
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SCHEDULES AND ATTACHMENTS
Annex A Operating Lease
Annex B Financing Lease
Schedule 1 Litigation Claims
Schedule 2 [Reserved]
Schedule 3 Business Locations
Schedule 4 Liens
ATTACHMENT A-1 Information on Refinanced Vehicles and Eligible Receivables
ATTACHMENT A-2 Vehicle Acquisition Schedule
ATTACHMENT B Form of Power of Attorney
ATTACHMENT C Form of Certification of Trade or Business Use
ATTACHMENT D Form of Affiliate Joinder in Lease
ATTACHMENT E Form of Annual Certificate
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MASTER MOTOR VEHICLE LEASE AND SERVICING AGREEMENT
This Master Motor Vehicle Lease and Servicing Agreement (the "Base Lease"
and, as supplemented by the Lease Annexes, this "Agreement" or "Lease"), dated
as of March 4, 1998, is by and among RENTAL CAR FINANCE CORP., a special
purpose Oklahoma corporation (the "Lessor" or "RCFC"), DOLLAR RENT A CAR
SYSTEMS, INC., an Oklahoma corporation ("Dollar"), as lessee and servicer,
THRIFTY RENT-A-CAR SYSTEM, INC., an Oklahoma corporation ("Thrifty"), as lessee
and servicer, and those Subsidiaries of DTAG (as defined below) from time to
time becoming Lessees hereunder pursuant to Section 28 hereof (each, an
"Additional Lessee"), as lessee and servicer (Thrifty, Dollar, and the
Additional Lessees, in their respective capacities as lessees, each a "Lessee"
and, collectively, the "Lessees", and, in their respective capacities as
servicers, each a "Servicer" and, collectively, the "Servicers"), and DOLLAR
THRIFTY AUTOMOTIVE GROUP, INC., a Delaware corporation ("DTAG"), as Master
Servicer (in such capacity, the "Master Servicer") and as Guarantor (in such
capacity, the "Guarantor").
W I T N E S S E T H:
WHEREAS, the Lessor (such capitalized term, together with all other
capitalized terms used herein, shall have the meaning assigned thereto in
Section 1) intends to purchase, finance and refinance the purchase of, Eligible
Vehicles from one or more Manufacturers with the proceeds obtained from the
issuance by the Lessor of its Rental Car Asset Backed Variable Funding Notes,
Series 1998-1, pursuant to the Base Indenture and the Series 1998-1 Supplement
thereto referred to below and any additional Series of Notes identified in the
related Series Supplement as a Group II Series of Notes; and
WHEREAS, the Lessor desires to lease to the Lessees, and the Lessees desire
to lease from the Lessor, Eligible Vehicles for use in the Lessees' respective
businesses, including subleasing Vehicles to Eligible Franchisees;
NOW, THEREFORE, in consideration of the foregoing premises, and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties hereto, the parties hereto hereby agree as follows:
SECTION 1. CERTAIN DEFINITIONS.
Section 1.1. Certain Definitions. As used in this Lease and unless the
context requires a different meaning, capitalized terms not otherwise defined
herein shall have the meanings assigned to such terms in (a) the Series 1998-1
Supplement, dated as of March 4, 1998, between RCFC, as issuer, and Bankers
Trust Company, a New York banking corporation, as trustee (in such capacity,
the "Trustee") (as such Series 1998-1 Supplement may be amended, amended and
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restated, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Series 1998-1 Supplement"), to the Base Indenture,
dated as of December 13, 1995, between RCFC and the Trustee, as amended by
Amendment to Base Indenture, dated as of December 23, 1997, between RCFC and
the Trustee (as amended by such amendment and as the same may be further
amended, amended and restated, supplemented or otherwise modified from time to
time in accordance with the terms thereof, the "Base Indenture") and any
additional Series Supplement to the Base Indenture relating to a Series of
Notes identified in such Series Supplement as a Group II Series of Notes and
(b) the Definitions List attached as Schedule 1 to the Base Indenture as in
effect as of the date hereof (as such Definitions List may be amended, amended
and restated, supplemented or otherwise modified from time to time in
accordance with the terms thereof, the "Definitions List"), provided, that any
capitalized term used but not defined herein and defined in each of the Series
1998-1 Supplement and the Definitions List shall have the meaning set forth in
the Series 1998-1 Supplement.
Section 1.2. Accounting and Financial Determinations. Where the character
or amount of any asset or liability or item of income or expense is required to
be determined, or any accounting computation is required to be made, for the
purpose of this Lease, such determination or calculation shall be made, to the
extent applicable and except as otherwise specified in this Lease, in
accordance with GAAP. When used herein, the term "financial statement" shall
include the notes and schedules thereto.
Section 1.3. Cross References; Headings. The words "hereof", "herein" and
"hereunder" and words of a similar import when used in this Lease shall refer
to this Lease as a whole and not to any particular provision of this Lease.
Annex, Section, Schedule and Exhibit references contained in this Lease are
references to Annexes, Sections, Schedules and Exhibits in or to this Lease
unless otherwise specified. Any reference in any Section or definition to any
clause is, unless otherwise specified, to such clause of such Section or
definition. The various headings in this Lease are inserted for convenience
only and shall not affect the meaning or interpretation of this Lease or any
provision hereof.
Section 1.4. Interpretation. In this Lease, unless the context otherwise
requires:
(a) the singular includes the plural and vice versa;
(b) reference to any Person includes such Person's successors and
assigns but, if applicable, only if such successors and assigns are
permitted by this Lease, and reference to any Person in a particular
capacity refers only to such Person in such capacity;
(c) reference to any gender includes the other gender;
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(d) reference to any Requirement of Law means such Requirement of Law
as amended, modified, codified or reenacted, in whole or in part, and in
effect from time to time;
(e) "including" (and, with correlative meaning, "include") means
including without limiting the generality of any description preceding such
term;
(f) "or" is not exclusive;
(g) provisions apply to successive events and transactions; and
(h) with respect to the determination of any period of time, "from"
means "from and including" and "to" and "through" mean "to but excluding".
SECTION 2. GENERAL AGREEMENT. (a) As specified in the Lease Annexes, the
Lessees and the Lessor intend that this Lease be (i) an operating lease with
respect to the Acquired Vehicles and (ii) a financing arrangement with respect
to the Financed Vehicles.
(b) If, notwithstanding the intent of the parties to this Lease, this
Lease is deemed by any court, tribunal, arbitrator or other adjudicative
authority in any proceeding (each, a "Court") to constitute a financing
arrangement or otherwise not to constitute a "true lease" with respect to the
Acquired Vehicles, then it is the intention of the parties that this Lease
together with the Master Collateral Agency Agreement, as such agreements apply
to the Acquired Vehicles, shall constitute a security agreement under
applicable law, and it is the intention of the parties that this Lease together
with the Master Collateral Agency Agreement, as such agreements apply to the
Financed Vehicles, shall in all events constitute a security agreement under
applicable law. Each Lessee hereby acknowledges that it has granted to the
Master Collateral Agent, pursuant to the Master Collateral Agency Agreement,
for the benefit of the Trustee, a first priority security interest in all of
such Lessee's right, title and interest in and to the Lessee Grantor Master
Collateral (as defined therein) as collateral security for the prompt and
complete payment and performance when due (whether at stated maturity, by
acceleration or otherwise) of all of the obligations and liabilities of such
Lessee to the Lessor and the Trustee, whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred
(including interest accruing after the Lease Expiration Date and interest
accruing after the filing of any petition in bankruptcy, or the commencement of
any insolvency, reorganization or like proceeding), which may arise under, out
of, or in connection with, this Lease and any other document made, delivered or
given in connection herewith, whether on account of rent, principal, interest,
reimbursement obligations, fees, indemnities, costs, or expenses (including all
fees and disbursements of counsel to the Lessor or the Trustee that are
required to be paid by such Lessee pursuant to the terms hereof).
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Section 2.1. Leasing of Vehicles. Subject to the terms and conditions
hereof, the Lessor agrees to lease to each Lessee and each Lessee agrees to
lease from the Lessor Vehicles in the Existing Fleet, as applicable, and each
additional Acquired Vehicle or Financed Vehicle identified in Vehicle order
summaries (each, a "Vehicle Order") produced from time to time by such Lessee,
listing Eligible Vehicles ordered by the Lessee for itself or as agent for the
Lessor, pursuant to the terms of any applicable Eligible Vehicle Disposition
Programs or otherwise. The Lessor shall, subject to Section 4 and to
compliance with the terms of the Indenture, make available to the Lessees under
this Lease financing for Financed Vehicles (other than Texas Vehicles) in an
aggregate amount, and Acquired Vehicles and Texas Vehicles for lease to the
Lessees hereunder in an aggregate Net Book Value, which collectively shall not
exceed the Maximum Lease Commitment. The applicable Lessee shall make
available to the Lessor (a) in the case of (i) any lease of Vehicles in the
Existing Fleet, (ii) the refinancing of any other Eligible Vehicle pursuant to
Section 2.3 of the Master Collateral Agency Agreement (collectively, together
with any Vehicles in the Existing Fleet to be leased under the Master Lease
(including, without limitation, any Vehicles previously subject to any other
Master Lease and refinanced pursuant to the Master Lease), "Refinanced
Vehicles"), and/or (iii) the refinancing of Eligible Receivables, a schedule as
set forth in Attachment A-1 hereto containing information concerning the
Refinanced Vehicles and the Eligible Receivables of a scope agreed upon by the
Lessor and such Lessee (a "Refinancing Schedule") , and (b) in the case of all
other Vehicles, a schedule containing the information with respect to the
Vehicles included within the Vehicle Order for such Vehicle as is set forth in
Attachment A-2 hereto, or in such form as is otherwise requested by the Lessor
(each, a "Vehicle Acquisition Schedule"). In addition, each Lessee shall
provide such other information regarding such Vehicles as the Lessor may
reasonably require from time to time. The Lessor shall lease to the Lessees,
and the Lessees shall lease from the Lessor, only Vehicles that are Eligible
Vehicles. This Lease, together with the Vehicle Disposition Programs and other
incentive programs relating to the Vehicles and any other related documents
attached to this Lease or submitted with a Vehicle Order or Refinancing
Schedule (collectively, the "Supplemental Documents"), will constitute the
entire agreement regarding the leasing of Vehicles by the Lessor to the
Lessees.
Section 2.2. Right of Lessees to Act as Lessor's Agent. The Lessor agrees
that each Lessee may act as the Lessor's agent in placing Vehicle Orders on
behalf of the Lessor, as well as filing claims on behalf of the Lessor for
damage in transit, and other delivery related claims with respect to the
Vehicles leased hereunder; provided, however, that the Lessor may hold the
applicable Lessee liable for such Lessee's actions in performing as the
Lessor's agent hereunder. In addition, the Lessor agrees that each Lessee may
make arrangements for delivery of Vehicles to a location selected by such
Lessee at such Lessee's expense. Each Lessee or any related Sublessee, as
applicable, may accept or reject Eligible Vehicles upon delivery in accordance
with such Lessee's customary business practices, and any Eligible Vehicle, if
rejected, will be deemed a Casualty hereunder. The applicable Lessee, acting
as agent for the Lessor, shall be responsible for pursuing any rights of the
Lessor with respect to the return of any Eligible Vehicle to the Manufacturer
thereof, or the applicable auction or dealer, as applicable, pursuant to the
preceding
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sentence. Each Lessee agrees that all vehicles ordered as provided herein
shall be Eligible Vehicles and shall be ordered utilizing the procedures
consistent with the applicable Vehicle Disposition Program or any guidelines of
the Manufacturer, auction or dealer, as applicable, for the ordering or
purchasing of Non-Program Vehicles, in each case as and to the extent
applicable.
Section 2.3. Payment of Purchase Price by Lessor. Upon receipt of the
Manufacturer's invoice and certificate of origin in respect of any new Vehicle,
or such other customary documentation in respect of any used Vehicle, the
Lessor or its agent shall pay or cause to be paid to the auction, the dealer or
the related Manufacturer, as applicable, the costs and expenses incurred in
connection with the acquisition of such Vehicle under the applicable Vehicle
Disposition Program (in the case of a Program Vehicle) or otherwise (in the
case of a Non-Program Vehicle) as established by the invoice of the auction,
the dealer or the Manufacturer, as the case may be (the "Initial Acquisition
Cost"), for such Vehicle and the applicable Lessee shall pay all applicable
costs and expenses of freight, packing, handling, storage, shipment and
delivery of such Vehicle to the extent that the same have not been included
within the Initial Acquisition Cost; provided that solely in the case of any
Vehicle in the Existing Fleet, any other Refinanced Vehicle, and any Eligible
Receivable, the Lessor shall pay to the Master Collateral Agent (x) the
aggregate Net Book Value as of the Vehicle Lease Commencement Date of the
Existing Fleet Vehicles, and/or the Refinanced Vehicles, as applicable, and
(y) the face amount of the Eligible Receivables being refinanced on the Vehicle
Lease Commencement Date.
Section 2.4. Non-liability of Lessor. The Lessor shall not be liable to a
Lessee for any failure or delay in obtaining Vehicles or making delivery
thereof. AS BETWEEN THE LESSOR AND THE LESSEES, ACCEPTANCE FOR LEASE OF THE
VEHICLES SHALL CONSTITUTE THE APPLICABLE LESSEE'S ACKNOWLEDGMENT AND AGREEMENT
THAT THE APPLICABLE LESSEE HAS FULLY INSPECTED SUCH VEHICLES, THAT THE VEHICLES
ARE IN GOOD ORDER AND CONDITION AND ARE OF THE MANUFACTURE, DESIGN,
SPECIFICATIONS AND CAPACITY SELECTED BY SUCH LESSEE, THAT SUCH LESSEE IS
SATISFIED THAT THE SAME ARE SUITABLE FOR ITS USE AND THAT THE LESSOR IS NOT A
MANUFACTURER, AN AGENT OF THE MANUFACTURER OR OTHERWISE ENGAGED IN THE SALE OR
DISTRIBUTION OF VEHICLES, AND HAS NOT MADE AND DOES NOT HEREBY MAKE ANY
REPRESENTATION, WARRANTY OR COVENANT, EXPRESS OR IMPLIED, WITH RESPECT TO
MERCHANTABILITY, CONDITION, QUALITY, CAPABILITY, WORKMANSHIP, DURABILITY OR
SUITABILITY OF SUCH VEHICLES IN ANY RESPECT OR IN CONNECTION WITH OR FOR THE
PURPOSES OR USES OF SUCH LESSEE, OR ANY WARRANTY THAT THE LEASED VEHICLES WILL
SATISFY THE REQUIREMENTS OF ANY LAW OR ANY CONTRACT SPECIFICATION, OR ANY OTHER
REPRESENTATION, WARRANTY OR COVENANT OF ANY KIND OR CHARACTER, EXPRESS OR
IMPLIED, WITH RESPECT THERETO, AND AS BETWEEN THE LESSOR AND SUCH LESSEE, SUCH
LESSEE AGREES TO BEAR ALL SUCH RISKS AT ITS SOLE COST AND EXPENSE. EACH LESSEE
SPECIFICALLY WAIVES ALL
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RIGHTS TO MAKE CLAIMS AGAINST THE LESSOR AND ANY LEASED VEHICLE FOR BREACH OF
ANY WARRANTY OF ANY KIND WHATSOEVER AND, AS TO THE LESSOR, AND EACH LESSEE
LEASES THE LEASED VEHICLES "AS IS." The Lessor shall not be liable for any
failure or delay in delivering any Vehicle ordered for lease pursuant to this
Lease, or for any failure to perform any provision hereof, resulting from fire
or other casualty, natural disaster, riot, strike or other labor difficulty,
governmental regulation or restriction, or any cause beyond the Lessor's direct
control. IN NO EVENT SHALL THE LESSOR BE LIABLE FOR ANY INCONVENIENCES, LOSS
OF PROFITS OR ANY OTHER CONSEQUENTIAL, INCIDENTAL OR SPECIAL DAMAGES,
WHATSOEVER OR HOWSOEVER CAUSED, WHETHER RESULTING FROM ANY DEFECT IN OR ANY
THEFT, DAMAGE, LOSS OR FAILURE OF ANY VEHICLE, OR OTHERWISE, AND THERE SHALL BE
NO ABATEMENT OF RENT BECAUSE OF THE SAME.
SECTION 3. TERM.
Section 3.1. Vehicle Lease Commencement Date. The "Vehicle Lease
Commencement Date" shall mean, for each Vehicle, the earlier of (a) the date
referenced in the Vehicle Acquisition Schedule or Refinancing Schedule with
respect to such Vehicle, and (b) the date that funds are expended by the Lessor
to acquire or finance the acquisition of such Vehicle (with respect to such
Vehicle, the "Vehicle Funding Date"). A vehicle shall be deemed hereunder to
be a Vehicle leased under this Lease on each day during the period (the
"Vehicle Term") from and including the Vehicle Lease Commencement Date to but
excluding the Vehicle Lease Expiration Date.
Section 3.2. Lease Commencement Date; Lease Expiration Date. The "Lease
Commencement Date" shall mean the Closing Date for the Series 1998-1 Notes as
the first Group II Series of Notes issued under the Indenture. The "Lease
Expiration Date" shall mean the later of (i) the date of the payment in full of
all Series of Notes included in the Group II Series of Notes and all
outstanding Carrying Charges related thereto, and (ii) the Vehicle Lease
Expiration Date for the last Vehicle subject to lease by a Lessee hereunder.
The "Term" of this Lease shall mean the period commencing on the Lease
Commencement Date and ending on the Lease Expiration Date.
SECTION 4. CONDITIONS PRECEDENT
Section 4.1. Conditions to Each Lease of Vehicles. The agreement of the
Lessor to make available (a) any Acquired Vehicle for lease to the applicable
Lessee, (b) Texas Vehicles and (c) financing for the acquisition of or
refinancing of any other Financed Vehicle for lease to such Lessee upon such
Lessee's placement of a Vehicle Order, for itself or as agent of the Lessor, or
its delivery of a Refinancing Schedule, as applicable, is subject to the terms
and conditions of the Indenture and subject to the satisfaction of the
following conditions precedent as of the Vehicle Lease Commencement Date for
such Vehicle:
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Section 4.1.1 No Default. No Lease Event of Default or Amortization Event
shall have occurred and be continuing on such date or would result from the
leasing of such Vehicle or Vehicles.
Section 4.1.2 Limitations of the Acquisition of Certain Vehicles. After
giving effect to the inclusion of such Vehicle under this Lease, there shall
not be a failure or violation of any of the conditions, requirements, or
restrictions specified in any related Series Supplement with respect to the
leasing of Eligible Vehicles under this Lease.
Section 4.1.3 Vehicle Order. The applicable Lessee shall have complied
with the applicable provisions of Section 2.1 of this Lease.
Section 4.1.4 Funding. The aggregate amount of funds to be expended by
the Lessor on any one date to acquire or finance the acquisition of any
Vehicles shall not exceed the sum of (a) the aggregate Net Book Value of all
such Vehicles plus (b) the aggregate face amount of any related Eligible
Receivables being refinanced on such date.
Section 4.1.5 Maximum Non-Program Percentage. The leasing of such
Vehicles will not cause the aggregate Net Book Value of Non-Program Vehicles
then being leased under this Lease to exceed the Maximum Non-Program Percentage
and will not cause any of the Lease commitments expressed in Section 3 of each
of Annex A and B to be exceeded.
Section 4.1.6 Eligible Vehicle. Each Vehicle to be leased hereunder on
such date shall be an Eligible Vehicle.
Section 4.2 Additional Conditions to Leases of Refinanced Vehicles. In
addition to the conditions set forth in Section 4.1 above, in connection with
the leasing of Refinanced Vehicles and related Eligible Receivables, to
evidence the refinancing of such Refinanced Vehicles and related Eligible
Receivables on the applicable Vehicle Lease Commencement Date and the
conveyance on such date of a security interest in such Refinanced Vehicles and
related Eligible Receivables to the Master Collateral Agent, the applicable
Lessees shall have made available to the Lessor on or prior to the applicable
Vehicle Lease Commencement Date the following:
(a) a Refinancing Schedule concerning such Refinanced Vehicles and
related Eligible Receivables being refinanced on such Vehicle Lease
Commencement Date;
(b) a report of the results of a search of the appropriate records of
the principal place in which each Lessee of such Refinanced Vehicles does
business and the county and state in which each Lessee's principal office
is located, which shall show no liens or other security interests (other
than Permitted Liens) with respect to such Vehicles and the related Vehicle
Disposition Programs (to the extent not already liened and assigned to the
Master Collateral Agent) or, in the event that such search reveals any such
non-permitted
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Lien or security interest, there shall be delivered to the Trustee a
termination of such Lien or security interest together with appropriate UCC
termination statements or UCC partial releases thereof;
(c) confirmation from each lender holding a security interest in any
Refinanced Vehicle and Eligible Receivable stating unconditionally (A)
that, if any sums are to be paid to such lender in connection with the
lease of such Refinanced Vehicle and the refinancing of the related
Eligible Receivables, such lender has been paid the full amount due to it
in connection with such refinancing and (B) that any lien or security
interest of such lender in such Refinanced Vehicle and related Eligible
Receivable has been released;
(d) a fully executed assignment agreement granting and assigning to
the Master Collateral Agent (to the extent not already granted and
assigned) a first priority security interest in each such Refinanced
Vehicle and any Eligible Receivables, the related Vehicle Disposition
Programs, if any, and any other Master Lease Collateral relating to such
Refinanced Vehicles and Eligible Receivables;
(e) with respect to any of such Refinanced Vehicles which are in the
Existing Fleet, each Lessee thereof shall have delivered to the Master
Collateral Agent a duly executed Assignment Agreement satisfactory in form
to the Lessor and the Trustee;
(f) delivery to the Lessor for filing in the appropriate filing
office fully executed UCC-1 Financing Statements necessary to perfect (if
not already perfected) the interests of the Master Collateral Agent in the
Eligible Receivables;
(g) an Officer's Certificate stating that all the conditions
precedent under this Lease to the leasing of such Refinanced Vehicles and
financing of the Eligible Receivables under this Lease have been satisfied,
including a representation that each such receivable is an Eligible
Receivable.
SECTION 5. RENT AND CHARGES. Each Lessee will pay Rent and certain other
charges on a monthly basis as set forth in this Section 5:
Section 5.1. Payment of Rent. On each Due Date, each Lessee shall pay to
the Lessor the aggregate of all Rent that has accrued during the Related Month
with respect to the Vehicles leased by such Lessee, as provided in the related
Lease Annexes.
Section 5.2. Payment of Availability Payment. On each Due Date, each
Lessee shall pay to the Lessor its allocable share of the Availability Payment
in respect of the unutilized portion of the Maximum Lease Commitment.
"Availability Payment" with respect to each Due Date
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shall equal the excess, if any, of (I) the sum of (a) the aggregate interest
due on all Outstanding Notes included in the Group II Series of Notes as of the
Payment Date next succeeding such Due Date, plus (b) an amount equal to all
Carrying Charges for the Related Month allocable to any Group II Series of
Notes, over (II) the sum of (a) any Monthly Variable Rent due on such Due Date,
(b) any Monthly Finance Rent due on such Due Date, and (c) any earnings on
Permitted Investments allocated to any Group II Series of Notes (less any
portion thereof allocated to the Retained Interestholder) accruing through the
Determination Date occurring prior to such Due Date and not included in the
calculation of Availability Payments with respect to any prior Due Date.
Section 5.3. Payment of Monthly Supplemental Payments. On each Due Date,
each Lessee shall pay to the Lessor the Monthly Supplemental Payments that have
accrued during the Related Month with respect to the Financed Vehicles leased
hereunder by such Lessee, as provided in Sections 6 and 7 of Annex B.
Section 5.4. Payment of Termination Payments, Casualty Payments, and Late
Return Payments. On each Due Date, each Lessee shall pay to the Lessor all
Termination Payments, Casualty Payments and Late Return Payments that have
accrued with respect to the Acquired Vehicles leased hereunder by such Lessee,
as provided in Sections 7, 12.3 and 13, respectively.
Section 5.5. Late Payment. In the event a Lessee fails to remit payment
of any amount due under this Lease on or before the Due Date, the amount not
paid will be considered delinquent and such Lessee will pay a late charge equal
to the product of (a) the VFR plus 1%, times (b) the delinquent amount for the
period from the Due Date to the date on which such delinquent amount is
received by the Trustee, times (c) the actual number of days elapsed during
such period divided by 360.
SECTION 6. INSURANCE.
Section 6.1. Fleet Insurance. Each Lessee shall at all times maintain or
cause to be maintained, with financially sound and reputable insurers, (a)
personal injury and damage insurance with respect to the Vehicles leased by
such Lessee hereunder, and (b) insurance with respect to properties and
business against loss or damage of the kinds customarily insured against by
corporations of established reputation engaged in the same or similar
businesses and similarly situated, of such types and in such amounts as are
customarily carried under similar circumstances by such other corporations.
Each Lessee may, in lieu of maintaining such insurance with insurers,
self-insure.
Section 6.2. Information. Each Lessee shall, from time to time upon the
Lessor's or the Trustee's reasonable request, deliver to the Lessor and the
Trustee copies of certificates describing all insurance required by Section 6.1
which is then in effect.
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SECTION 7. CASUALTY OBLIGATION. If a Vehicle becomes a Casualty, then the
applicable Lessee shall (a) promptly notify the Lessor of such occurrence, and
(b) in the case of an Acquired Vehicle, on the Due Date next succeeding the
last day of the Related Month in which the Lessee obtains actual knowledge that
such Vehicle has become a Casualty, pay to the Lessor an amount (a "Casualty
Payment") equal to the Net Book Value of such Vehicle, calculated as of the
earlier of the last day of such Related Month and the date such vehicle is
disposed of or becomes a Casualty, as applicable. Upon payment by the
applicable Lessee to the Lessor in accordance herewith of the Casualty Payment
for any Acquired Vehicle that has become a Casualty, (i) the Lessor shall cause
title to such Vehicle to be transferred to such Lessee to facilitate
liquidation of such Vehicle by such Lessee, (ii) such Lessee shall be entitled
to any physical damage insurance proceeds applicable to such Acquired Vehicle
(if at such time such Lessee carries such insurance coverage), and (iii) the
Lien of the Master Collateral Agent on such Vehicle shall be released thereby.
SECTION 8. VEHICLE USE. So long as no Lease Event of Default, Liquidation
Event of Default or Series 1998-1 Limited Liquidation Event of Default has
occurred, the Lessees may use Vehicles leased hereunder in the regular course
of their respective businesses, including subleasing such Vehicles to Eligible
Franchisees pursuant to Lessee Agreements, including Subleases, used in the
ordinary course of Lessees' businesses. Notwithstanding any such Lessee
Agreement, the applicable Lessee shall remain fully liable for its obligations
under this Lease and the other Related Documents (including any obligation
hereunder or thereunder that it may cause any Franchisee to perform or
fulfill). Each Lessee shall cause all payments under the Lessee Agreements, to
the extent such payments relate to vehicles comprising the Master Collateral,
to be deposited directly into the Master Collateral Account, and upon the
occurrence and during the continuance of a Lease Event of Default, Liquidation
Event of Default or Series 1998-1 Limited Liquidation Event of Default, the
Master Servicer shall promptly specify to the Master Collateral Agent the
allocation of such payments among Financing Sources. Vehicle use shall be
confined primarily to the United States, with limited use outside the United
States; provided, however, that the principal place of business or rental
office of the Eligible Franchisee with respect to any Vehicles used outside the
United States shall be located in the United States. Each Lessee shall
promptly and duly execute, deliver, file and record all such documents,
statements, filings and registrations, and take such further actions as the
Lessor, the Master Collateral Agent, the Master Servicer or the Trustee shall
from time to time reasonably request in order to establish, perfect and
maintain the Lessor's title to and interest in the Acquired Vehicles and the
related Certificates of Title as against such Lessee or any third party in any
applicable jurisdiction and to establish, perfect and maintain the Master
Collateral Agent's Lien on the Vehicles and the related Certificates of Title
(other than recordation of liens with respect to the Existing Fleet) as a
perfected lien in any applicable jurisdiction. Each Lessee may, at such
Lessee's sole expense, change the place of principal location of any Vehicles.
After any such change of location, the applicable Lessee shall take all actions
necessary (i) to maintain the Lien of the Master Collateral Agent on such
Vehicles and the Certificates of Title with respect to such Vehicles (other
than recordation of liens with respect to the Existing Fleet), and (ii) to meet
or
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obtain all material legal requirements applicable to such Vehicles. Following
a Lease Event of Default or Manufacturer Event of Default, and upon the
Lessor's request, each Lessee shall advise the Lessor in writing where all
Vehicles leased by such Lessee hereunder as of such date are principally
located. The Lessees shall not knowingly use any Vehicles, or knowingly permit
the same to be used, for any unlawful purpose. The Lessees shall and shall
require the related Franchisees to use reasonable precautions to prevent loss
or damage to Vehicles. The Lessees shall or shall cause the related
Franchisees to comply with all applicable statutes, decrees, ordinances and
regulations regarding acquiring, titling, registering, leasing, insuring and
disposing of Vehicles and shall or shall require such related Franchisees to
take reasonable steps to ensure that operators are licensed. The Lessees shall
or shall cause the related Franchisees to perform, at its or their own expense,
such vehicle preparation and conditioning services with respect to Vehicles as
are customary. The Lessor, the Master Collateral Agent or the Trustee or any
authorized representative of the Lessor, the Master Collateral Agent or the
Trustee may during reasonable business hours from time to time, without
disruption of the applicable Lessee's or the related Franchisee's business,
subject to applicable law, inspect Vehicles and registration certificates,
Certificates of Title and related documents covering Vehicles wherever the same
be located.
SECTION 9. REGISTRATION; LICENSE; TRAFFIC SUMMONSES; PENALTIES AND FINES.
Each Lessee, at its expense, shall be responsible for proper registration and
licensing of the Vehicles leased by it hereunder, and the titling of such
Vehicles in the name of the Lessor (in the case of Acquired Vehicles and Texas
Vehicles) or the Lessor or such Lessee, as applicable (in the case of Financed
Vehicles and Vehicles in the Existing Fleet), in each case with the Lien of the
Master Collateral Agent noted thereon (other than with respect to the Existing
Fleet), and where required, each Lessee shall or shall cause the related
Franchisees to have Vehicles inspected by any appropriate governmental
authority; provided, however, that notwithstanding the foregoing, unless a
Liquidation Event of Default shall have occurred and be continuing, possession
of all Certificates of Title shall remain with each Servicer of the related
Vehicles or the Master Servicer with such Certificates of Title to be held in
trust, as agent of and custodian for the Master Collateral Agent. Each Lessee
shall pay or cause to be paid all registration fees, title fees, license fees,
traffic summonses, penalties, judgments and fines incurred with respect to any
Vehicle leased hereunder by such Lessee during the Vehicle Term for such
Vehicle or imposed during the Vehicle Term for such Vehicle by any governmental
authority or any court of law or equity with respect to Vehicles in connection
with the Lessee's operation of Vehicles, and any such amounts paid by the
Lessor, in its discretion, on such Lessee's behalf will be reimbursed within
thirty (30) days of the Lessor notifying the Lessee of such payment. The
Lessor agrees to execute a power of attorney substantially in the form of
Attachment B hereto (a "Power of Attorney"), and such other documents as may be
necessary in order to allow each Lessee to title, register and dispose of the
Acquired Vehicles and Texas Vehicles leased by such Lessee hereunder; and each
Lessee acknowledges and agrees that with respect to the Acquired Vehicles, it
has no right, title or interest in or with respect to any
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Certificate of Title. Notwithstanding anything herein to the contrary, the
Lessor may terminate such Power of Attorney as provided in Section 17.3.
SECTION 10. MAINTENANCE AND REPAIRS. Each Lessee shall or shall cause the
related Franchisees, as applicable, to pay for all maintenance and repairs to
keep the Vehicles leased by such Lessee hereunder in good working order and
condition, and shall or shall cause such Franchisees to maintain such Vehicles
as required in order to keep the Manufacturer's warranty in force. Each Lessee
shall or shall cause the related Franchisees to return each Vehicle to an
authorized Manufacturer facility or the applicable Manufacturer's authorized
warranty station for warranty work. Each Lessee shall or shall cause the
related Franchisees to comply with any Manufacturer's recall of any Vehicle.
Each Lessee shall or shall cause the related Franchisees to pay, or cause to be
paid, all usual and routine expenses incurred in the use and operation of
Vehicles including, but not limited to, fuel, lubricants, and coolants. The
Lessor, upon thirty (30) days' prior written notice to the applicable Lessee,
may pay any such expenses that have not otherwise been paid by, or on behalf
of, such Lessee (including any failure by a related Franchisee to pay any such
expenses), and any expenses incurred by the Lessor on such Lessee's behalf for
maintenance, repair, operation or use of Vehicles by such Lessee will be
promptly reimbursed (in any event no later than the next monthly Due Date
following such payment) by such Lessee to the Lessor in the amount paid by the
Lessor. Each Lessee shall not make any material alterations to any Vehicles
without the prior consent of the Lessor. Any improvements or additions to any
Acquired Vehicle shall become and remain the property of the Lessor, except
that any addition or improvement to such a Vehicle made by a Lessee shall
remain the property of such Lessee if it can be disconnected or removed from
the Vehicle without impairing the functioning of or resale value thereof, other
than any function or value provided by such addition or improvement.
SECTION 11. VEHICLE WARRANTIES. If a Vehicle is covered by a
Manufacturer's warranty, the applicable Lessee and each related Franchisee,
during the Vehicle Term, shall have the right to make any claims under such
warranty which the Lessor could make. As provided in Section 2.4, the Lessor
makes no warranty or representation whatsoever, express or implied, with
respect to any Vehicle.
SECTION 12. VEHICLE USAGE REQUIREMENTS AND DISPOSITION.
Section 12.1. Usage. As used herein, the term "vehicle turn-in condition"
with respect to each Program Vehicle leased hereunder by a Lessee means a set
of criteria for evaluating Program Vehicles upon their delivery at the end of
the applicable Vehicle Terms, which criteria will be determined in accordance
with the related Vehicle Disposition Program. Each Program Vehicle leased
hereunder by a Lessee not meeting the applicable Vehicle Disposition Program's
vehicle turn-in condition requirements will, unless redesignated as a
Non-Program Vehicle in accordance with Section 14, be purchased by such Lessee
in accordance with the Casualty
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procedure set forth in Section 7 or otherwise disposed of in accordance with
the late delivery procedure set forth in Section 13, as applicable.
Section 12.2. Disposition Procedure. Prior to the end of the Vehicle
Term, each Lessee will or will cause the related Franchisee to deliver each
Program Vehicle leased hereunder by such Lessee (other than a Casualty) to the
nearest related Manufacturer official auction or other facility designated by
such Manufacturer at such Lessee's sole expense and in accordance with the
terms of the applicable Vehicle Disposition Program. Any transportation
allowance (for delivery costs) and any rebates or credits applicable to the
unexpired term of any license plates for a Vehicle shall inure to the benefit
of and, upon receipt thereof by the Lessor, the Trustee or the Master
Collateral Agent, shall promptly be paid over to the applicable Lessee. Each
Lessee will comply with the requirements of law and the requirements of the
Vehicle Disposition Programs in connection with, among other things, the
delivery of Certificates of Title, documents of transfer signed as necessary,
signed Condition Reports, and signed odometer statements for the Program
Vehicles.
Section 12.3. Termination Payments. On the Due Date next succeeding the
earlier of (a) the last day of the Related Month in which the Repurchase
Payment or the Guaranteed Payment, as the case may be, from a Manufacturer
pursuant to its Vehicle Disposition Program with respect to any Acquired
Vehicle that is a Program Vehicle, is received by the Lessor, the Master
Collateral Agent or the Trustee (including by deposit into the Collection
Account or the Master Collateral Account), and (b) the thirtieth (30th) day
after the expiration of the Maximum Term for such Vehicle, the Lessee that
leases such Vehicle hereunder shall pay to the Lessor in respect of such
Vehicle any Excess Damage Charges, Excess Mileage Charges, early turnback
surcharges and any other similar charges and penalties (collectively, a
"Program Vehicle Termination Payment") as determined by the Manufacturer or its
agent in accordance with the applicable Vehicle Disposition Program; and on the
Due Date next succeeding the earlier of (i) the last day of the Related Month
in which Disposition Proceeds from the sale or other disposition of an Acquired
Vehicle that is a Non-Program Vehicle, but is not a Casualty, are received by
the Lessor, the Master Collateral Agent or the Trustee (including by deposit
into the Collection Account or the Master Collateral Account), and (ii) the
thirtieth (30th) day after the date which is twenty- four (24) months after the
date of the original new dealer invoice for such Vehicle, the applicable Lessee
shall pay to the Lessor in respect of such Vehicle an amount (a "Non-Program
Vehicle Termination Payment") equal to the quotient of (x) the sum of all
Program Vehicle Termination Payments for the Related Month in respect of
Vehicles leased by such Lessee, divided by (y) the number of Acquired Vehicles
leased by such Lessee in respect of which such Program Vehicle Termination
Payments are payable (Program Vehicle Termination Payments and Non-Program
Vehicle Termination Payments being, collectively, "Termination Payments"). The
provisions of this Section 12.3 will survive the expiration or earlier
termination of the Term.
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SECTION 13. LATE RETURN PAYMENTS. If an Acquired Vehicle which is a
Program Vehicle is not returned to the Manufacturer or accepted by the
Manufacturer in accordance with the related Vehicle Disposition Program prior
to the expiration of the Maximum Term for such Vehicle in accordance with
Section 12.2, the Lessee of such Vehicle hereunder shall, unless such Vehicle
has been redesignated as a Non-Program Vehicle in accordance with Section 14,
(a) promptly notify the Lessor of its failure to return such Vehicle to the
Manufacturer or to sell such Vehicle in accordance with the applicable Auction
Procedures during the Vehicle Term, (b) use commercially reasonable efforts to
sell or otherwise dispose of such Vehicle in a manner reasonably likely to
maximize proceeds from such disposition and consistent with industry practice,
(c) cause the Disposition Proceeds, if any, from any such sale or disposition
to be paid to the Master Collateral Agent, in accordance with paragraph 10(d)
of Annex A, and (d) on the Due Date next succeeding the earlier of (i) the last
day of the Related Month in which such Disposition Proceeds are received by the
Lessor, the Master Collateral Agent or the Trustee (including by deposit into
the Collection Account or the Master Collateral Account), and (ii) the
thirtieth (30th) day after the expiration of the Maximum Term for such Vehicle,
pay to the Lessor an amount (a "Late Return Payment") equal to the excess of
(x) the Net Book Value of such Vehicle, calculated as of the first day of the
calendar month in which such Maximum Term expired reduced by the Depreciation
Charges accrued with respect to such Vehicle through the date such Maximum Term
expired, over (y) the dollar amount of such Disposition Proceeds (which Late
Return Payment amount may be equal to, but not less than, zero dollars). The
foregoing shall not affect the applicable Lessee's obligation to pay on the
related Due Date all Monthly Base Rent accrued with respect to each such
Vehicle through the date on which the Maximum Term for such Vehicle expires.
SECTION 14. REDESIGNATION OF VEHICLES. (a) Upon a Program Vehicle's
becoming ineligible for repurchase by its Manufacturer or for sale in
accordance with applicable Auction Procedures, due to physical damage, repair
charges or accrued mileage, in each case in excess of that permitted under the
related Vehicle Disposition Program, or due to any failure or inability to
return such Vehicle to the Manufacturer or the designated auction site prior to
the expiration of the Maximum Term, or due to any other event or circumstance,
the applicable Servicer may designate such Vehicle as a Non-Program Vehicle if
such Vehicle, as a Non-Program Vehicle, will be an Eligible Vehicle and if
either (a) such designation meets the conditions of Section 4.2 or (b) the
Noteholders holding the requisite Invested Amount of each applicable Series of
Notes included in the Group II Series of Notes waive, in each case as and to
the extent permitted under the related Series Supplement, the requirements of
Section 4.2 as applied to this Section 14 and all such other conditions,
requirements or restrictions with respect to which a failure or violation has
occurred; provided, in each case, that (x) any additional Monthly Base Rent due
with respect to each such Vehicle, relating to the decrease, if any, of the Net
Book Value of such Vehicle under the newly applicable Depreciation Schedule,
shall be paid by the applicable Lessee on the next succeeding Due Date, and (y)
the minimum level of Enhancement required under the applicable Series
Supplement, after giving effect to such designation, shall be satisfied on the
date of designation.
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(b) The applicable Servicer may designate a Non-Program Vehicle as a
Program Vehicle; provided, however, that (i) upon such redesignation and
through and including the applicable Vehicle Lease Expiration Date, such
Vehicle shall be an Eligible Vehicle, (ii) such Vehicle qualifies as an
Eligible Vehicle under the applicable Eligible Vehicle Disposition Program,
(iii) the Capitalized Cost, Net Book Value and Depreciation Charges with
respect to such Vehicle shall be recalculated as of the date of such
redesignation as if such Vehicle was a Program Vehicle at the time of the
initial related Vehicle Lease Commencement Date, and (iv) the related
Manufacturer has acknowledged such designation. Upon any redesignation of a
Vehicle pursuant to this Section 14(b), (x) the Lessor shall advance to the
applicable Manufacturer the difference (if any) between the original
Capitalized Cost of such Vehicle and the Capitalized Cost of such Vehicle upon
redesignation, which amount shall be deemed to be part of the Initial
Acquisition Cost of such Vehicle and (y) the applicable Lessee shall be
entitled to a credit against the Monthly Base Rent due on the next succeeding
Due Date in an amount equal to the excess (if any) of the Net Book Value of
such Vehicle upon such redesignation over the original Net Book Value of such
Vehicle immediately prior to such redesignation.
(c) Any Financed Vehicle shall be redesignated as an Acquired Vehicle for
all purposes of this Lease, the Indenture and the Master Collateral Agency
Agreement, and shall become subject to the Operating Lease and shall cease to
be subject to the Financing Lease, upon the completion of the transfer
(including the re-registration of title ownership) of such Financed Vehicle to
the Lessor pursuant to the Limited Guarantee and Reimbursement Agreement.
SECTION 15. GENERAL INDEMNITY.
Section 15.1. Indemnity of the Lessor. Each Lessee agrees to indemnify
and hold harmless the Lessor and the Lessor's directors, officers, agents and
employees (collectively, together with the Persons subject to indemnity under
Section 15.2, the "Indemnified Persons") against any and all claims, demands
and liabilities of whatsoever nature, and all costs and expenses, relating to
or in any way arising out of:
Section 15.1.1. the ordering, delivery, acquisition, title on
acquisition, rejection, installation, possession, titling, retitling,
registration, re-registration, custody by such Lessee of title and
registration documents, use, non-use, misuse, operation, deficiency,
defect, transportation, repair, control or disposition of any Vehicle
leased hereunder or to be leased hereunder by such Lessee, including,
without limitation, any such Vehicle subleased to a Franchisee of such
Lessee and any of the foregoing actions, events or circumstances occurring
or arising in connection with such subleasing, any related Lessee
Agreement, any related Franchisee or any customer of any such related
Franchisee. The foregoing shall include, without limitation, any claim by
any third party against the Lessee for personal injury, property or other
damages arising out of any of the foregoing with respect to any such
Vehicles;
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Section 15.1.2. all (i) federal, state, county, municipal, foreign or
other fees and taxes of any nature, including but not limited to license,
qualification, registration, franchise, sales, use, gross receipts, ad
valorem, business, property (real or personal), excise, motor vehicle, and
occupation fees and taxes, and all federal, state, local and foreign income
taxes (including any taxes payable by the Lessor as a result of its being a
member of any group of corporations, including such Lessee, that file any
tax returns on a consolidated or combined basis), and penalties and
interest thereon, whether assessed, levied against or payable by the Lessor
or otherwise, with respect to any Vehicle leased by such Lessee hereunder
or the acquisition, purchase, sale, lease, sublease, rental, use,
operation, control, ownership or disposition of any such Vehicle by any
Person or measured in any way by the value thereof or by the business of,
investment by, or ownership by the Lessor or such Lessee with respect
thereto, and (ii) documentary, stamp, filing, recording, mortgage or other
taxes, if any, which may be payable by the Lessor or such Lessee in
connection with this Lease or the other Related Documents or the related
Lessee Agreements and any penalties or interest with respect thereto;
Section 15.1.3. any violation by such Lessee of this Lease or of any
Related Documents or Lessee Agreements to which such Lessee is a party or
by which it is bound or any laws, rules, regulations, orders, writs,
injunctions, decrees, consents, approvals, exemptions, authorizations,
licenses and withholdings of objecting of any governmental or public body
or authority and all other requirements having the force of law applicable
at any time to any Vehicle Leased by such Lessee hereunder or any action or
transaction by such Lessee with respect thereto or pursuant to this Lease;
Section 15.1.4. such Lessee's Pro Rata Share of all out-of-pocket
costs of the Lessor (including the reasonable fees and out-of-pocket
expenses of counsel for the Lessor) in connection with the execution,
delivery and performance of this Lease and the other Related Documents,
including, without limitation, overhead expenses and any and all fees of
the Trustee, Paying Agent, Clearing Agencies and Master Collateral Agent,
all fees payable in connection with any Enhancement, any and all fees of
the Master Servicer or any Servicer under the Indenture, fees payable to
the Rating Agencies in connection with their rating of the Commercial Paper
Notes and any underwriting or placement agency fees incurred in connection
with the sale of any Notes included in the Group II Series of Notes or
Commercial Paper Notes, in each case to the extent allocable to this Lease;
and
Section 15.1.5. such Lessee's Pro Rata Share of all out-of-pocket
costs and expenses (including reasonable attorneys' fees and legal
expenses) incurred by the Lessor, the Master Collateral Agent, the Trustee
or the Holders of Notes included in the Group II Series of Notes in
connection with the administration, enforcement, waiver or amendment of
this Lease and any other Related Documents, and all indemnification
obligations of the Lessor under the Related Documents.
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Notwithstanding the foregoing, no Lessee shall have any duty to indemnify
any Indemnified Person for any consequential or punitive damages or claims,
demands, liabilities, costs, or expenses to the extent such claim, demand,
liability, cost or expense arises out of or is due to such Indemnified Person's
gross negligence or willful misconduct.
Section 15.2. Indemnification of the Trustee. Each Lessee agrees to
indemnify and hold harmless the Trustee and the Trustee's officers, directors,
agents and employees against any and all or, in the case of clause (ii) below,
such Lessee's Pro Rata Share of all claims, demands and liabilities of
whatsoever nature, and all or, in the case of clause (ii) below, such Lessee's
Pro Rata Share of all costs and expenses, relating to or in any way arising out
of: (i) any acts or omissions of such Lessee pursuant to this Lease and (ii)
the Trustee's appointment under the Base Indenture and the Trustee's
performance of its obligations thereunder, or any document pertaining to any of
the foregoing to which the Trustee is a signatory, including, but not limited
to any judgment, award, settlement, reasonable attorneys' fees and other costs
or expenses incurred in connection with the defense of any actual or threatened
action, proceeding or claim; provided, however, the Lessees shall have no duty
to indemnify the Trustee, or any other Indemnified Person pursuant to this
Section 15.2, to the extent such claim, demand, liability, cost or expense
arises out of or is due to the Trustee's or such Indemnified Person's gross
negligence or willful misconduct. Any such indemnification shall not be
payable from the assets of the Lessor. The provisions of this indemnity shall
run directly to and be enforceable by the Trustee or any other Indemnified
Person subject to the limitations hereof. The indemnification provided for in
this Section 15.2 shall be in addition to any other indemnities available to
the Trustee and shall survive the termination of the duties of the Lessees
hereunder and the termination of this Lease or a document to which the Trustee
is a signatory or the resignation or removal of the Trustee.
Section 15.3. Reimbursement Obligation by the Lessees. The applicable
Lessee shall forthwith upon demand reimburse the Lessor or the Trustee, as the
case may be, for any sum or sums expended with respect to any of the foregoing,
or shall pay such amounts directly upon request from the Lessor or the Trustee;
provided, however, that, if so requested by such Lessee, the Lessor or the
Trustee shall submit to such Lessee a statement documenting any such demand for
reimbursement or prepayment. To the extent that such Lessee in fact
indemnifies the Lessor or the Trustee under the indemnity provisions of this
Lease, such Lessee shall be subrogated to the rights of the Lessor or the
Trustee, as the case may be, in the affected transaction and shall have a right
to determine the settlement of claims therein. The foregoing indemnity as
contained in this Section 15 shall survive the expiration or earlier
termination of this Lease or any lease of any Vehicle hereunder; provided,
however, that the factual or legal circumstances giving rise to the Lessor's
exposure to liability occur during the period that the Lease is in effect as to
the Vehicle for which such exposure to liability arose.
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Section 15.4. Notice to Lessee of Claims. The Lessor or the Trustee, as
the case may be, shall notify the applicable Lessee in writing (a "Notice of
Claim") of the pendency of any such claim, action or facts referred to in this
Section 15 for which indemnity may be required.
Section 15.5. Defense of Claims. Defense of any claim referred to in this
Section 15 for which indemnity may be required shall, at the option and request
of the applicable Lessee, be conducted by such Lessee. Following receipt of
any Notice of Claim, such applicable Lessee will inform the Indemnified Person
of its election to defend such claim. Such Indemnified Person may participate
in any such defense at its own expense, provided such participation does not
interfere with such Lessee's defense. Each Lessee agrees that no Indemnified
Person will be liable to such Lessee for any claim caused directly or
indirectly by the inadequacy of any Vehicle for any purpose or any deficiency
or defect therein or the use or maintenance thereof or any repairs, servicing
or adjustments thereto or any delay in providing or failure to provide such or
any interruption or loss of service or use thereof or any loss of business, all
of which shall be the risk and responsibility of such Lessee, except to the
extent that any of the foregoing is caused by the gross negligence or willful
misconduct of such Indemnified Person. The rights and indemnities of each
Indemnified Person hereunder are expressly made for the benefit of, and will be
enforceable by, each Indemnified Person notwithstanding the fact that such
Indemnified Person is not or is no longer a party to (or entitled to receive
the benefits of) this Lease. This general indemnity shall not affect any
claims of the type discussed above which a Lessee may have against the
Manufacturer.
SECTION 16. ASSIGNMENT. No Lessee shall, except as provided in the Base
Indenture, without prior written consent of the Lessor and the Trustee, assign
this Lease or any of its rights hereunder to any other party; provided,
however, a Lessee may sublease or rent Vehicles leased by it under the terms of
such Lessee's normal Sublease agreements to Eligible Franchisees, and such
Lessee and such Eligible Franchisees may rent such Vehicles to consumers in the
ordinary course of their daily rental business. Any purported assignment in
violation of this Section 16 shall be void and of no force or effect. Nothing
contained herein shall be deemed to restrict the right of a Lessee to acquire
or dispose of, by purchase, lease, financing, or otherwise, motor vehicles that
are not subject to the provisions of this Lease.
SECTION 17. DEFAULT AND REMEDIES THEREFOR.
Section 17.1. Lease Events of Default. Any one or more of the following
will constitute an event of default (a "Lease Event of Default") as that term
is used herein:
Section 17.1.1. there occurs a default in the payment of any Monthly
Base Rent, Monthly Variable Rent, Monthly Finance Rent, Termination
Payment, Casualty Payment, Late Return Payment, Monthly Supplemental
Payment, Availability Payment or other amount payable under this Lease, and
the continuance thereof for three (3) Business Days with respect to any
payment of Monthly Base Rent or five (5) Business Days with respect
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to any other amounts, in each case after notice thereof by the Lessor, the
Master Collateral Agent or the Trustee to the applicable Lessee and the
Guarantor;
Section 17.1.2. any unauthorized assignment or transfer of this Lease
by a Lessee or the Guarantor occurs;
Section 17.1.3. the failure of a Lessee or the Guarantor to observe
or perform any other covenant, condition, agreement or provision hereof,
which failure has a Material Adverse Effect on the Lessor, and such default
continues for more than sixty (60) days after the earlier to occur of (a)
the date a Responsible Officer of such Lessee obtains knowledge of such
default or (b) the date written notice thereof is delivered by the Lessor,
the Master Collateral Agent or the Trustee to such Lessee; provided,
however, that if such failure cannot reasonably be cured within such sixty
(60) day period, no Lease Event of Default shall result therefrom so long
as, within such sixty (60) day period, such Lessee (i) commences to cure
same, (ii) delivers written notice to the Lessor, the Master Collateral
Agent and the Trustee notifying the Lessor, the Master Collateral Agent and
the Trustee of such default and setting forth the steps such Lessee intends
to take in order to cure such default and (iii) thereafter diligently
prosecutes such cure to completion and completely cures such default on or
before the ninetieth (90th) day after the earlier of the dates set forth in
clause (a) and clause (b) above;
Section 17.1.4. if any representation or warranty made by a Lessee or
the Guarantor proves untrue in any respect as of the date of the issuance
or making thereof, which inaccuracy or falsehood has a Material Adverse
Effect on the Lessor, and such inaccuracy or falsehood is not cured within
sixty (60) days after notice thereof from the Lessor, the Master Collateral
Agent or the Trustee to such Lessee;
Section 17.1.5. an Event of Bankruptcy occurs with respect to a
Lessee or the Guarantor; or
Section 17.1.6. a Series 1998-1 Enhancement Deficiency shall occur
and continue for at least one (1) Business Day after the Master Servicer
obtains actual knowledge thereof; provided, however, that such event or
condition shall not be a Lease Event of Default if within such one (1)
Business Day period DTAG shall have taken any of the actions described in
the proviso to Section 5.1(a) of the Series 1998-1 Supplement such that the
Series 1998-1 Enhancement Deficiency no longer exists and such action is in
accordance with the terms of Section 4.7(d)(v) of the Series 1998-1
Supplement.
Section 17.2. Effect of Lease Event of Default. If (i) a Lease Event of
Default described in Section 17.1.1(i), 17.1.2 or 17.1.5 shall occur, then the
Monthly Base Rent, the Monthly Supplemental Payment and Casualty Payments (in
each case calculated as if all Vehicles had become a Casualty for the Related
Month), the Monthly Variable Rent, the Availability Payment
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and the Monthly Finance Rent (in each case calculated as if the full amount of
interest, principal and other charges under all Outstanding Series of Notes
included in the Group II Series of Notes were then due and payable in full),
Termination Payments and Late Return Payments shall, automatically, without
further action by the Lessor or the Trustee, become immediately due and payable
or (ii) any other Lease Event of Default or any Liquidation Event of Default
shall occur, the Lessor or the Trustee may declare the Rent and all other
charges and payments (calculated as described in clause (i) above) to be due
and payable, whereupon such Rent and such other charges and payments (as so
calculated) shall, subject to Section 17.5, become immediately due and payable.
Section 17.3. Rights of Lessor Upon Lease Event of Default, Liquidation
Event of Default or Limited Liquidation Event of Default. If a Lease Event of
Default, Liquidation Event of Default or Limited Liquidation Event of Default
shall occur, then the Lessor at its option may:
(i) Proceed by appropriate court action or actions, either at law or
in equity, to enforce performance by the Lessees of the applicable
covenants and terms of this Lease or to recover damages for the breach
hereof calculated in accordance with Section 17.5; or
(ii) By notice in writing to each Lessee, terminate this Lease in its
entirety and/or the right of possession hereunder of the Lessees as to the
Vehicles, and the Lessor may direct delivery by the Lessees of documents of
title to the Vehicles, whereupon all rights and interests of the Lessees to
the Vehicles (except as otherwise provided herein) will cease and terminate
(but the Lessees will remain liable hereunder as herein provided,
calculated in accordance with Section 17.5); and thereupon, the Lessor or
its agents may, subject in each case to the rights of the Franchisees under
the applicable Subleases, peaceably enter upon the premises of the Lessees
or other premises where the Vehicles may be located and take possession of
them and thenceforth hold, possess and enjoy the same free from any right
of the Lessees, or their successors or assigns (other than the
Franchisees), to employ the Vehicles for any purpose whatsoever consistent
with the mitigation of losses and damages, and the Lessor will,
nevertheless, have a right to recover from the Lessees any and all amounts
which under the terms of Section 17.2 (as limited by Section 17.5) of this
Lease may be then due. The Lessor will provide the applicable Lessee with
written notice of the place and time of any sale of Financed Vehicles
pursuant to this Section 17.3 at least five (5) days prior to the proposed
sale, which shall be deemed commercially reasonable, and such Lessee or the
Lessor may purchase the Vehicle(s) at the sale. Each and every power and
remedy hereby specifically given to the Lessor will be in addition to every
other power and remedy hereby specifically given or now or hereafter
existing at law, in equity or in bankruptcy and each and every power and
remedy may be exercised from time to time and simultaneously and as often
and in such order as may be deemed expedient by the Lessor; provided,
however, that the measure of damages recoverable against a Lessee will in
any
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case be calculated in accordance with Section 17.5. All such powers and
remedies will be cumulative, and the exercise of one will not be deemed a
waiver of the right to exercise any other or others. No delay or omission
of the Lessor in the exercise of any such power or remedy and no renewal or
extension of any payments due hereunder will impair any such power or
remedy or will be construed to be a waiver of any default or any
acquiescence therein. Any extension of time for payment hereunder or other
indulgence duly granted to a Lessee will not otherwise alter or affect the
Lessor's rights or the obligations hereunder of such Lessee. The Lessor's
acceptance of any payment after it will have become due hereunder will not
be deemed to alter or affect the Lessor's rights hereunder with respect to
any subsequent payments or defaults therein; or
(iii) By notice in writing to a Lessee, terminate the Power of
Attorney of such Lessee.
Section 17.4. Rights of Trustee Upon Liquidation Event of Default, Limited
Liquidation Event of Default, Manufacturer Event of Default and Non-Performance
of Certain Covenants.
(i) If a Liquidation Event of Default or a Limited Liquidation Event
of Default or, with respect to Program Vehicles, a Manufacturer Event of
Default, shall have occurred and be continuing, the Lessor and the Trustee,
to the extent provided in the Indenture, shall have the rights against the
Guarantor, each Lessee, each Manufacturer in connection with any
Manufacturer Event of Default and the Master Lease Collateral provided in
the Indenture (including, without limitation, in connection with a
Manufacturer Event of Default, the rights granted under Section 8.2 of the
Indenture) upon a Liquidation Event of Default or Limited Liquidation Event
of Default, including the right to take possession of all Group II Vehicles
immediately from the Lessees.
(ii) With respect to Program Vehicles, if the Guarantor or any Lessee
shall default in the due performance and observance of any of its
obligations under Section 6.1, 23.4, 24.3, 24.4 (f), 24.7 or 25.4 hereof,
and such default shall continue unremedied for a period of 30 days after
notice thereof shall have been given to the Guarantor or the applicable
Lessee, as the case may be, by the Lessor, the Lessor or the Trustee, as
assignee of the Lessor's rights hereunder, shall have the ability to
exercise all rights, remedies, powers, privileges and claims of the
Guarantor or any Lessee against the Manufacturers under or in connection
with the Eligible Vehicle Disposition Programs with respect to (i) Group II
Vehicles that are Program Vehicles which the Guarantor or any Lessee has
determined to turn back to the Manufacturers under such Eligible Vehicle
Disposition Programs and (ii) whether or not the Guarantor or any Lessee
shall then have determined to turn back such Group II Vehicles that are
Program Vehicles, any such Program Vehicles for which the applicable
Maximum Term will expire within one week or less.
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(iii) Upon a default in the performance (after giving effect to any
grace periods provided herein) by the Guarantor or any Lessee of its
obligations hereunder to keep the Group II Vehicles free of Liens and to
maintain the Trustee's Lien perfected on the Master Lease Collateral, the
Trustee shall have the right to take actions reasonably necessary to
correct such default with respect to the subject Vehicles including the
execution of UCC financing statements with respect to Eligible Vehicle
Disposition Program and other general intangibles, and the completion of
Vehicle Perfection and Documentation Requirements on behalf of the
Guarantor or any Lessee, as applicable.
(iv) Upon the occurrence of a Liquidation Event of Default or Limited
Liquidation Event of Default, the Guarantor and each Lessee will return any
Group II Vehicles that are Program Vehicles to the related Manufacturer in
accordance with the instructions of the Lessor.
(v) Upon the occurrence of a Liquidation Event of Default or Limited
Liquidation Event of Default, the Lessor shall have the right to dispose of
(x) those Group II Vehicles that are Program Vehicles not accepted by the
related Manufacturer under the applicable Eligible Program pursuant to
clause (iv) above and (y) the Group II Vehicles that are Non-Program
Vehicles and to direct the Guarantor or the applicable Lessee to dispose of
such Vehicles in accordance with its instructions. In addition, the Lessor
shall have all of the rights, remedies, powers, privileges and claims
vis-a-vis the Guarantor or any Lessee, necessary or desirable to allow the
Trustee to exercise the rights, remedies, powers, privileges and claims
given to the Trustee pursuant to Section 8.1 and, with respect to Program
Vehicles, Section 8.2 of the Base Indenture and the Guarantor and each
Lessee acknowledges that it has hereby granted to the Lessor all of the
rights, remedies, powers, privileges and claims granted to the Trustee
pursuant to Article 8 of the Base Indenture and that, under certain
circumstances set forth in the Base Indenture, the Trustee may act in lieu
of the Lessor in the exercise of such rights, remedies, powers, privileges
and claims.
Section 17.5. Measure of Damages. If a Lease Event of Default,
Liquidation Event of Default or Limited Liquidation Event of Default occurs and
the Lessor, the Master Collateral Agent or the Trustee exercises the remedies
granted to the Lessor, the Master Collateral Agent or the Trustee under this
Section 17 or under Section 8.2 of the Base Indenture, the amount that the
Lessor shall be permitted to recover shall be equal to:
(i) all Rent and payments under this Lease (calculated as provided in
Section 17.2); plus
(ii) any damages and expenses (other than punitive and consequential
damages), which the Lessor, the Master Collateral Agent or the Trustee will
have sustained by reason of the Lease Event of Default, Liquidation Event
of Default or Limited
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Liquidation Event of Default, together with reasonable sums for such
attorneys' fees and such expenses as will be expended or incurred in the
seizure, storage, rental or sale of the Vehicles or in the enforcement of
any right or privilege hereunder or in any consultation or action in such
connection; plus
(iii) all other amounts due and payable under this Lease; plus
(iv) interest from time to time on amounts due and unpaid under this
Lease at the VFR plus 1%, computed from the date of the Lease Event of
Default, Liquidation Event of Default or Limited Liquidation Event of
Default or the date payments were originally due the Lessor under this
Lease or from the date of each expenditure by the Lessor which is
recoverable from a Lessee pursuant to this Section 17, as applicable, to
and including the date payments are made by the Lessee; minus
(v) an amount equal to all sums realized by the Lessor, the Master
Collateral Agent and the Trustee from the liquidation of the Financed
Vehicles (other than a Texas Vehicle) leased hereunder (either by receipt
of payment from the Manufacturers under Vehicle Disposition Programs, from
sales of Vehicles to third parties, or otherwise), provided, however, that
if a Financed Vehicle (other than a Texas Vehicle) is delivered to the
Manufacturer or the designated auction site for repurchase by the
Manufacturer under the applicable Vehicle Disposition Program or for sale
in accordance with the applicable Auction Procedures, respectively, and
such Vehicle is accepted for repurchase or sale by such Manufacturer (as
evidenced by a Condition Report indicating that such Vehicle conforms to
the requirements for repurchase or sale under such Vehicle Disposition
Program), the Lessor and the Trustee shall be deemed to have received
thirty (30) days after the date of such acceptance or sale on account of
this clause (v) an amount equal to the Net Book Value of such Vehicle,
calculated as of its Disposition Date (less any Termination Payments
payable in respect of such Vehicle).
Section 17.6. Application of Proceeds. The proceeds of any sale or other
disposition of any Financed Vehicles pursuant to Section 17.3 shall be applied
in the following order: (i) to the reasonable costs and expenses incurred by
the Lessor in connection with such sale or disposition, including any
reasonable costs associated with repairing such Vehicles, and reasonable
attorneys' fees in connection with the enforcement of this Lease, (ii) to the
payment of outstanding Rent owing from the applicable Lessee and payments under
the Lease owing from such Lessee (such proceeds to be applied first, to
outstanding Monthly Variable Rent and Monthly Finance Rent pro rata, second, to
outstanding Availability Payments, third, to outstanding Base Rent and Monthly
Supplemental Payments pro rata, fourth, to outstanding Termination Payments,
Casualty Payments and Late Return Payments pro rata and fifth, to outstanding
late charges pursuant to Sections 5.5 and 17.5(iv)), (iii) to the payment of
all other amounts due hereunder from such Lessee, (iv) to the payment of any
amounts to the Lessor, or such Person(s) as may be lawfully entitled thereto,
and (v) any remaining proceeds to such Lessee.
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SECTION 18. MANUFACTURER EVENTS OF DEFAULT. Upon the occurrence of any of
the following events (each, a "Manufacturer Event of Default") with respect to
a Manufacturer, the Lessees on behalf of the Lessor (a) shall no longer place
Vehicle Orders for additional Program Vehicles from such Manufacturer (each, a
"Defaulting Manufacturer") and (b) shall cancel any Vehicle Order with such
Defaulting Manufacturer to which a vehicle identification number (a "VIN") has
not been assigned as of the date such Manufacturer Event of Default occurs:
Section 18.1. The failure of such Manufacturer to pay Guaranteed Payments,
Repurchase Payments and/or Incentive Payments due under, respectively, such
Manufacturer's Vehicle Disposition Programs and its incentive programs, in an
aggregate amount in excess of $40,000,000 (net of amounts that are the subject
of a good faith dispute, as evidenced in writing by either the applicable
Lessee or the Manufacturer questioning the accuracy of the amounts paid or
payable in respect of any such Vehicle Disposition Programs or incentive
programs), which failure, in the case of each such Guaranteed Payment,
Repurchase Payment and/or Incentive Payment included in such amount in excess
of $40,000,000 continues for more than ninety (90) days following the
Disposition Date for the related Vehicle.
Section 18.2. The occurrence of an Event of Bankruptcy with respect to
such Manufacturer.
SECTION 19. CERTIFICATION OF TRADE OR BUSINESS USE. Pursuant to Section
7701 of the Code and as set forth in Attachment C hereto, each Lessee will
warrant and certify that (1) such Lessee intends to use the Acquired Vehicles
in a trade or business of such Lessee, and (2) such Lessee has been advised
that it will not be treated as the owner of the Acquired Vehicles for federal
income tax purposes.
SECTION 20. SURVIVAL. In the event that, during the term of this Lease, a
Lessee becomes liable for the payment or reimbursement of any obligations,
claims or taxes pursuant to any provision hereof, such liability will continue,
notwithstanding the expiration or termination of this Lease, until all such
amounts are paid or reimbursed by such Lessee.
SECTION 21. RIGHTS OF LESSOR PLEDGED TO MASTER COLLATERAL AGENT AND
TRUSTEE. Notwithstanding anything to the contrary contained in this Lease,
each Lessee and the Guarantor acknowledges that each of the Lessees and the
Lessor, pursuant to the Master Collateral Agency Agreement, has granted a
security interest to the Master Collateral Agent, for the benefit of the
Beneficiaries specified therein, in all of its right, title and interest in, to
and under the Vehicles, the related Vehicle Disposition Programs, the Master
Collateral Account and all other Master Collateral specified in the Master
Collateral Agency Agreement as being pledged by Thrifty, Dollar and RCFC, and
each Lessee and the Guarantor further acknowledges that the Lessor, pursuant to
the Indenture, has granted a security interest to the Trustee in all of its
right, title and interest in, to and under the RCFC Agreements, the Collection
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Account and the other Collateral described in the Indenture. Accordingly, each
Lessee and the Guarantor agrees that:
(i) Subject to the terms of the Indenture, the Trustee shall have all
the rights, powers, privileges and remedies of the Lessor hereunder.
Specifically, each Lessee and the Guarantor agrees that, upon the
occurrence of an Amortization Event, the Trustee or, with respect to any
Master Collateral, the Master Collateral Agent (for and on behalf of the
Trustee) may exercise any right or remedy against each Lessee or the
Guarantor provided for herein or in the Indenture or the Master Collateral
Agency Agreement and none of the Lessees or the Guarantor will interpose as
a defense that such claim should have been asserted by the Lessor;
(ii) Upon the delivery by the Master Collateral Agent or the Trustee
of any notice to a Lessee or the Guarantor stating that a Lease Event of
Default or an Amortization Event with respect to such Lessee has occurred,
then such Lessee or the Guarantor will, if so requested by the Master
Collateral Agent (with respect to the Master Collateral) or the Trustee
(with respect to the Collateral), treat the Master Collateral Agent or the
Trustee or the Master Collateral Agent's or the Trustee's designee, as the
case may be, for all purposes as the Lessor hereunder and in all respects
comply with all obligations under this Lease that are asserted by the
Master Collateral Agent or the Trustee as the successor to the Lessor
hereunder, irrespective of whether such Lessee or the Guarantor has
received any such notice from the Lessor;
(iii) Pursuant to the Indenture, the Lessor hereby irrevocably
authorizes and directs each Lessee to, and each Lessee shall, make payments
of Rent hereunder directly to the Trustee for deposit in the Group II
Collection Account established by the Trustee for receipt of such payments
pursuant to the Indenture, and such payments shall discharge the obligation
of such Lessee to the Lessor hereunder with respect to Rent to the extent
of such payments. Each Lessee further acknowledges that pursuant to the
Master Collateral Agency Agreement, the Lessor has irrevocably authorized
and directed such Lessee to, and such Lessee shall, cause all payments
under the related Lessee Agreements, each Vehicle Disposition Programs, and
all other Master Collateral pledged by such Lessee to the Master Collateral
Agent for the benefit of the Trustee (as Beneficiary on behalf of the
holders of each Series of Notes included in the Group II Series of Notes),
to be made directly to the Master Collateral Agent for deposit in the
Master Collateral Account established by the Lessor for receipt of such
payments pursuant to the Master Collateral Agency Agreement, and each such
payment (other than any payment that is subject to distribution to such
Lessee or its designee pursuant to Section 2.5(b) of the Master Collateral
Agency Agreement and that is not transferred to the Collection Account)
shall constitute a prepayment in respect of the obligation of such Lessee
to pay the Rent due hereunder on the next succeeding Due Date. Upon
written notice to a Lessee of a sale or assignment by the Trustee or Master
Collateral Agent of its right, title and interest in
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moneys due under this Lease or the Master Collateral Agency Agreement to a
successor Trustee or Master Collateral Agent, such Lessee shall thereafter
make payments of Rent hereunder or payments in respect of the Master
Collateral, as applicable, to the party specified in such notice;
(iv) Upon request made by the Master Collateral Agent at any time,
each Lessee will take such actions (other than recordation of liens with
respect to the Existing Fleet) as are requested by the Master Collateral
Agent to assist the Master Collateral Agent in maintaining the Master
Collateral Agent's perfected security interest in the Vehicles leased by
such Lessee under this Lease, the Certificates of Title with respect
thereto and the related Master Collateral pursuant to the Master Collateral
Agency Agreement; and
(v) A security interest in the Lessor's rights under this Lease has
been granted by the Lessor to the Trustee pursuant to the Indenture as
collateral security only for all Series of Notes included in Group II and,
accordingly, all references herein to "all" Series of Notes shall refer
only to all Series of Notes included in Group II.
SECTION 22. MODIFICATION AND SEVERABILITY. The terms of this Lease will
not be waived, altered, modified, amended, supplemented or terminated in any
manner whatsoever except by a written instrument signed by the Lessor, each
Lessee and (except as to matters referred to in Section 27.3) the Guarantor,
and consented to in writing by the Master Collateral Agent and the Trustee, the
Required Group II Noteholders and each Enhancement Provider with respect to
each Series of Notes included in Group II. If any part of this Lease is not
valid or enforceable according to law, all other parts will remain enforceable.
The Lessor shall provide prompt written notice to each Rating Agency of any
such waiver, modification or amendment.
Notwithstanding the foregoing provisions of this Section 22, the Lessor,
the Lessees and the Guarantor may, at any time and from time to time, without
the consent of the Master Collateral Agent, the Trustee, any Noteholders or
any Enhancement Provider, enter into any amendment, supplement or other
modification to this Lease to cure any apparent ambiguity or to correct or
supplement any provision in this Lease that may be inconsistent with any other
provision herein; provided, however, that (i) any such action shall not have a
Material Adverse Effect on the interests of any Enhancement Provider for a
Series of Notes included in the Group II Series of Notes, based upon, at the
request of the Trustee, an Opinion of Counsel and an officers' certificate of
the Lessor and each Lessee addressed to the Trustee and (ii) a copy of such
amendment, supplement or other modification is furnished to the Trustee, each
Enhancement Provider with respect to any Series of Notes included in the Group
II Series of Notes and each Rating Agency in accordance with the notice
provisions hereof not later than ten days prior to the execution thereof by the
Lessor, the Lessees and the Guarantor.
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SECTION 23. CERTAIN REPRESENTATIONS AND WARRANTIES. Each Lessee and
Servicer represents and warrants to the Lessor, as to itself and the Vehicles
leased by it hereunder, and the Guarantor represents and warrants to the
Lessor, as to itself and as to each Lessee and Servicer, that as of the Closing
Date with respect to the Series 1998-1 Notes as the first Group II Series of
Notes:
Section 23.1. Due Organization, Authorization, No Conflicts, Etc. Each of
the Lessees and the Guarantor is a corporation duly organized and validly
existing and in good standing under the laws of the jurisdiction of its
incorporation and is duly qualified and in good standing in each jurisdiction
where, because of the nature of its activities or properties, the failure so to
qualify would have a Material Adverse Effect on such Lessee or the Guarantor.
The execution, delivery and performance by each Lessee and the Guarantor of
this Lease and the other Related Documents to be executed and delivered by it
are within its corporate powers, have been duly authorized by all necessary
corporate action (including shareholder approval, if required), have received
all necessary governmental and other consents, approvals (in each case if any
shall be required), and do not and will not contravene or conflict with, or
create a default, breach, Lien or right of termination or acceleration under,
any Requirement of Law or Contractual Obligation binding upon it, other than
such default, breach, Lien or right of termination or acceleration which does
not have a Material Adverse Effect on such Lessee or the Guarantor, as
applicable. This Lease and each other Related Document to be executed and
delivered by a Lessee or the Guarantor are (or when executed and delivered will
be) the legal, valid, and binding obligations of such Person, enforceable
against such Person in accordance with their respective terms, subject to
bankruptcy, insolvency and other laws affecting the enforcement of creditors'
rights.
Section 23.2. Financial Information; Financial Condition. All balance
sheets, all statements of operations, of shareholders' equity and of cash flow,
and other financial data which have been or shall hereafter be furnished to the
Lessor or the Trustee for the purposes of or in connection with this Lease or
the Related Documents have been and will be prepared in accordance with GAAP
and do and will present fairly the financial condition of the entities involved
as of the dates thereof and the results of their operations for the periods
covered thereby. Such financial data include the following financial statements
and reports which have been furnished to the Lessor and the Trustee on or prior
to such Closing Date:
(1) the audited balance sheet of the Guarantor and each Lessee as of
December 31, 1996 and the related statements of operations,
stockholders' equity and cash flows for the fiscal year ended on
such date; and
(2) the unaudited balance sheets of the Guarantor and each Lessee
and statement of operations, accompanied by an Officer's
Certificate verifying the accuracy and completeness thereof signed
by an Authorized Officer of the Guarantor and the Lessee, for the
9-month period ended September 30, 1997.
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Section 23.3. Litigation. Except for (i) claims set forth in Schedule 1
and (ii) claims which are fully covered by insurance, no claims, litigation
(including, without limitation, derivative actions), arbitration, governmental
investigation or proceeding or inquiry is pending or, to the best of the
Lessees' and the Guarantor's knowledge, threatened against a Lessee or the
Guarantor which would, if adversely determined, have a Material Adverse Effect
on a Lessee or the Guarantor.
Section 23.4. Liens. As of the date hereof, there is no Lien on, or no
financing statement (or similar statement or instrument of registration under
the law of any jurisdiction) covering or purporting to cover any interest of
any kind in, the Vehicles leased hereunder (other than those set forth in
Schedule 4, and other Permitted Liens).
Section 23.5. Necessary Actions. Upon the Servicers causing the Lien of
the Master Collateral Agent to be noted on the Certificates of Title with
respect to the Vehicles (other than the Vehicles in the Existing Fleet) or as
otherwise provided for by the Master Collateral Agency Agreement or the
Indenture, all filings, registrations and recordings necessary or appropriate
to create, preserve, protect and perfect the security interest granted to the
Master Collateral Agent in respect of the Master Collateral (other than the
Vehicles in the Existing Fleet) have been accomplished and, assuming the
delivery to, and continuing possession by, the Lessor or its agents or
assignees of all instruments and documents (in each case as defined in the UCC
as in effect in New York) a security interest in which is perfected by
possession (except with regard to property constituting fixtures, any reserved
rights of the United States government as required by law, Liens upon patents,
patent licenses, trademarks, service marks and trademark licenses, to the
extent that such Liens cannot be perfected by the filing of financing
statements under the Uniform Commercial Code as in effect in the applicable
jurisdiction, Liens on uncertified securities and security entitlements, Liens
on Master Collateral the perfection of which requires filings in or other
actions under the laws of jurisdictions outside of the United States of
America, any State, territory or dependency thereof or the District of
Columbia, and Liens on general intangibles or accounts (in each case as defined
in the UCC as in effect in New York) on which the United States of America or
any department, agency, or instrumentality thereof is the obligor), and
assuming that the applicable Lessee has rights in the Master Collateral within
the meaning of the UCC as in effect in New York, the security interest granted
to the Master Collateral Agent pursuant to the Master Collateral Agency
Agreement in and to the Master Collateral (other than the Vehicles in the
Existing Fleet) constitutes a perfected security interest therein (but as to
the copyrights and copyright licenses and accounts arising therefrom, only to
the extent the UCC of the relevant jurisdiction, from time to time in effect,
is applicable), prior to the rights of all other Persons (except, with respect
to goods (as defined in the UCC), buyers in the ordinary course of business to
the extent provided in Section 9-307(1) of the UCC as from time to time in
effect in the applicable jurisdiction) therein and subject to no other Liens
other than Permitted Liens (and the interests of such buyers in the ordinary
course of business) and is entitled to all rights, priorities and benefits
afforded to perfected security interests by the UCC or other relevant law as
enacted in any relevant jurisdiction.
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Section 23.6. Employee Benefit Plans. (a) During the twelve consecutive
month period prior to the date hereof (or, with respect to each Series of Notes
included in the Group II Series of Notes after the Closing Date for the Series
1998-1 Notes, the Closing Date with respect to such Series of Notes): (i) no
steps have been taken to terminate any Pension Plan and (ii) no contribution
failure has occurred with respect to any Pension Plan sufficient to give rise
to a Lien under Section 302(f)(1) of ERISA in connection with such Pension
Plan; (b) no condition exists or event or transaction has occurred with respect
to any Pension Plan which could result in the incurrence by a Lessee, the
Guarantor or any member of the Controlled Group of fines, penalties or
liabilities for ERISA violations, which in the case of any of the events
referred to in clause (a) above or this clause (b) would have a Material
Adverse Effect upon such Lessee or the Guarantor, and (c) none of the Lessees
and the Guarantor has any material contingent liability with respect to any
post-retirement benefits under a Welfare Plan, other than liability for
continuation coverage described in Subtitle B of Part 6 of Title I of ERISA and
liabilities which would not have a Material Adverse Effect upon any Lessee or
the Guarantor.
Section 23.7. Investment Company Act. Neither the Guarantor nor any
Lessee is an "investment company" or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended.
Section 23.8. Regulations G, T, U and X. Neither the Guarantor nor any
Lessee is engaged principally, or as one of its important activities, in the
business of extending credit for the purpose of purchasing or carrying margin
stock (within the meaning of Regulations G, T, U and X of the Board of
Governors of the Federal Reserve System).
Section 23.9. Business Locations; Trade Names; Principal Places of
Business Locations. Schedule 3 lists each of the locations where each Lessee
and the Guarantor maintains a chief executive office, principal place of
business, or any records; and Schedule 3 also lists such Person's legal name,
each name under or by which it conducts its business, each state in which it
conducts business and the state in which the it has its principal place of
business.
Section 23.10. Taxes. Each Lessee and the Guarantor has filed all
material tax returns that are required to be filed by it, and has paid or
provided adequate reserves for the payment of all taxes, including, without
limitation, all payroll taxes and federal and state withholding taxes, and all
assessments payable by it that have become due, other than those that are not
yet delinquent or are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves have been established, and are
being maintained, in accordance with GAAP. As of such Closing Date, there is
no ongoing material audit (other than routine sales tax audits and other
routine audits) or, to each Lessee's and the Guarantor's knowledge, material
tax liability for any period for which returns have been filed or were due,
other than those contested in good faith by appropriate proceedings and with
respect to which (x) adequate reserves have been established and are being
maintained in accordance with GAAP and (y) the failure to pay
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such taxes would not, individually or in the aggregate, have a Material Adverse
Effect on such Lessee or the Guarantor or a material adverse effect on the
Noteholders.
Section 23.11. Governmental Authorization. Each of the Lessees and the
Guarantor has all licenses, franchises, permits and other governmental
authorizations necessary for all businesses presently carried on by it
(including owning and leasing the real and personal property owned and leased
by it), except where failure to obtain such licenses, franchises, permits and
other governmental authorizations would not have a Material Adverse Effect on
such Person.
Section 23.12. Compliance with Laws. Each Lessee and the Guarantor: (i)
is not in violation of any Requirement of Law, which violation would have a
Material Adverse Effect on such Person, and to the best knowledge of each
Lessee and the Guarantor, no such violation has been alleged; (ii) has filed in
a timely manner all reports, documents and other materials required to be filed
by it with any Governmental Agency (and the information contained in each of
such filings is true, correct and complete in all material respects), except
where failure to make such filings would not have a Material Adverse Effect on
such Person; and (iii) has retained all records and documents required to be
retained by it pursuant to any Requirement of Law, except where failure to
retain such records would not have a Material Adverse Effect on such Person.
Section 23.13. Eligible Vehicles; Eligible Franchisees. Each Vehicle is
or will be, as the case may be, on the Vehicle Lease Commencement Date with
respect to such Vehicle, an Eligible Vehicle, and each Franchisee subleasing an
Eligible Vehicle from a Lessee is or will be, as the case may be, on the
sublease commencement date with respect to such Eligible Vehicle, an Eligible
Franchisee.
Section 23.14. Supplemental Documents True and Correct. All information
contained in any Vehicle Order, Refinancing Schedule or other Supplemental
Document which has been submitted, or which may hereafter be submitted by a
Lessee or the Guarantor to the Lessor is, or will be, true, correct and
complete.
Section 23.15. Accuracy of Information. All certificates, reports,
statements, documents and other information furnished to the Lessor, the
Trustee or the Master Collateral Agent by the Guarantor or any Lessee pursuant
to any provision of any Related Document, or in connection with or pursuant to
any amendment or modification of, or waiver under, any Related Document, shall,
at the time the same are so furnished, be complete and correct in all material
respects to the extent necessary to give the Lessor, the Trustee or the Master
Collateral Agent, as the case may be, true and accurate knowledge of the
subject matter thereof, and the furnishing of the same to the Lessor, the
Trustee or the Master Collateral Agent, as the case may be, shall constitute a
representation and warranty by the Guarantor and such Lessee made on the date
the same are furnished to the Lessor, the Trustee or the Master Collateral
Agent, as the case may be, to the effect specified herein.
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Each of the foregoing representations and warranties will be deemed to be
remade as of the Closing Date with respect to each Series of Notes included in
Group II.
SECTION 24. CERTAIN AFFIRMATIVE COVENANTS. Each Lessee and, as
applicable, each Servicer, the Master Servicer and DTAG in its capacity as
Guarantor each covenants and agrees that, until the expiration or termination
of this Lease, and thereafter until the obligations of such Lessee, such
Servicer, the Master Servicer or the Guarantor, as applicable, under this Lease
and the Related Documents are satisfied in full, unless at any time the Lessor
and the Trustee shall otherwise expressly consent in writing, it will:
Section 24.1. Corporate Existence; Foreign Qualification. Do and cause to
be done at all times all things necessary to (i) maintain and preserve its
corporate existence (except as permitted under Section 25.1); (ii) be duly
qualified to do business and in good standing as a foreign corporation in each
jurisdiction where the nature of its business makes such qualification
necessary and the failure to so qualify would have a Material Adverse Effect on
it; and (iii) comply with all Contractual Obligations and Requirements of Law
binding upon it, except to the extent that its failure to comply therewith
would not, in the aggregate, have a Material Adverse Effect on it.
Section 24.2. Books, Records and Inspections. (i) Maintain books and
records that are complete and accurate in all material respects with respect to
the Vehicles leased by it under this Lease; and (ii) at any time and from time
to time during regular business hours, and with reasonable prior notice from
the Lessor, the Master Collateral Agent or the Trustee, permit the Lessor, the
Master Collateral Agent or the Trustee (or such other Person who may be
designated from time to time by the Lessor, the Master Collateral Agent or the
Trustee), or its agents or representatives to examine and make copies of all
books, records and documents in the possession or under the control of such
Person relating to the Vehicles leased under this Lease, including without
limitation, in connection with the Master Collateral Agent's or the Trustee's
satisfaction of any requests of a Manufacturer performing an audit under its
Vehicle Disposition Program.
Section 24.3. Vehicle Disposition Programs. With respect to each Program
Vehicle leased by a Lessee, comply, or cause the related Franchisee to comply,
as appropriate, with all of its obligations under the applicable Vehicle
Disposition Program relating to such Vehicle.
Section 24.4. Reporting Requirements. Furnish, or cause to be furnished
to the Lessor (or to such other Persons as are specified below):
(a) Daily Reports. Daily reports of the Master Servicer as follows:
On each Business Day commencing on the Lease Commencement Date, the Master
Servicer shall prepare and maintain at the office of the Master Servicer, a
record (each, a "Daily Report") setting forth the aggregate amount of (i)
Guaranteed Payments, Repurchase
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Payments, Disposition Proceeds and Incentive Payments received from
Manufacturers under Vehicle Disposition Programs or incentive programs, or
from other Persons in connection with the sale or disposition of Vehicles
leased under this Lease, (ii) insurance proceeds in respect of Vehicles
leased under this Lease, (iii) payments in respect of Lessee Agreements,
and (iv) any other Collections in respect of the Master Collateral
allocable to the Trustee as Beneficiary (on behalf of the Holders of a
Series of Notes included in the Group II Series of Notes) and in each case
deposited in the Master Collateral Account and reported to the Master
Servicer by the Master Collateral Agent, in accordance with Section 2.5(b)
of the Master Collateral Agreement, not more than the second Business Day
preceding such Daily Report, and setting forth (x) the aggregate dollar
amount of the Collections identified in the foregoing clauses (i) through
(iv), (y) during the continuance of a Lease Event of Default or a
Liquidation Event of Default, and as needed under Section 2.5(c) or (d) of
the Master Collateral Agency Agreement or, in the sole judgment of the
Master Collateral Agent, as otherwise needed, the portion of such
Collections representing proceeds of the Master Collateral pledged by the
Lessor and the portion pledged by each Lessee, and (z) the aggregate dollar
amount of Sublease payments, insurance payments, warranty payments (if
any), and other payments which, so long as no Lease Event of Default or
Liquidation Event of Default has occurred and is continuing, may be
withdrawn from the Master Collateral Account and distributed to the
applicable Lessee, as set forth in Section 2.5(b) of the Master Collateral
Agency Agreement. Before 3:00 p.m. (New York City time) on each such
Business Day, the Master Servicer shall deliver a copy of the Daily Report
to the Master Collateral Agent and the Trustee.
(b) Monthly Certificate. Monthly certificates of the Master Servicer
as follows: On each Reporting Date, the Master Servicer shall forward to
the Lessee, the Lessor, the Trustee, the Paying Agent, the Rating Agencies
and any applicable Enhancement Provider, an Officers' Certificate of the
Master Servicer substantially in the form of Exhibit A (each, a "Monthly
Certificate") setting forth, inter alia, the following information (which,
in the cases of clauses (iii), (iv) and (v) below, will be expressed as a
dollar amount per $1,000 of the original principal amount of such Notes and
as a percentage of the outstanding principal balance of the Notes as of
such date): (i) the aggregate amount of payments received from the
Manufacturers under Vehicle Disposition Programs and deposited in the
Master Collateral Account and the aggregate amount of other Group II
Collections processed for the Related Month with respect to such Reporting
Date; (ii) the Invested Percentage on the last day of the second preceding
Related Month of each Series of Notes included in the Group II Series of
Notes (or, until the end of the second Related Month for such Series of
Notes, as of the Closing Date for such Series); (iii) for each Series
included in the Group II Series of Notes, the total amount to be
distributed to Noteholders on the next succeeding Payment Date; (iv) for
each Series included in the Group II Series of Notes, the amount of such
distribution allocable to principal on the Notes of such Series; (v) for
each Series included in the
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Group II Series of Notes, the amount of such distribution allocable to
interest on the Notes; (vi) for each Series included in the Group II Series
of Notes, the amount of Enhancement used or drawn (or to be used or drawn)
in connection with the distribution to Noteholders of such Series on the
next succeeding Payment Date, together with the aggregate amount of
remaining Enhancement not theretofore used or drawn; (vii) for each Series
included in the Group II Series of Notes, the Series Monthly Servicing Fee
for the next succeeding Payment Date; (viii) for each Series included in
the Group II Series of Notes, the existing Carryover Controlled
Amortization Amount, if any; (ix) for each Series included in the Group II
Series of Notes, the applicable Pool Factors with respect to such Related
Month; (x) the Aggregate Asset Amount of all Group II Series of Notes and
the amount of the Asset Amount Deficiency of all Group II Series of Notes,
if any, at the close of business on the last day of the Related Month; (xi)
if Enhancement is provided for any Series of Notes included in the Group II
Series of Notes by means of overcollateralization, the amount of recoveries
and losses for the Related Month and the amount of any excess funds
available for such overcollateralization, (xii) whether, to the knowledge
of the Master Servicer, any Lien exists on any of the Collateral for any
Series of Notes included in the Group II Series of Notes (other than
Permitted Liens) and (xiii) the percentage of Vehicles leased under this
Lease constituting Program Vehicles, the percentage of Vehicles leased
under this Lease constituting Non-Program Vehicles, and the percentage of
Vehicles leased under this Lease constituting Program Vehicles of each
Manufacturer and Non-Program Vehicles of each Manufacturer. The Trustee
shall be under no duty to recalculate, verify or recompute the information
supplied to it under this Section 24.4(b).
(c) Audit Report. As soon as available and in any event within one
hundred ten (110) days after the end of each fiscal year of the Guarantor,
a copy of the consolidated balance sheet of the Guarantor and its
Subsidiaries as at the end of such fiscal year, together with the related
statements of earnings, stockholders' equity and cash flows for such fiscal
year, prepared in reasonable detail and in accordance with GAAP, and
certified by Deloitte & Touche, LLP (or such other independent certified
public accountants of recognized national standing as shall be selected by
the Guarantor) as presenting fairly in all material respects the financial
condition and results of operations of the Guarantor and its Subsidiaries,
with such exceptions as may be noted in such accountants' report;
(d) Quarterly Statements. As soon as available, but in any event
within forty-five (45) days after the end of each fiscal quarter (except
the fourth fiscal quarter) of the Guarantor, copies of the unaudited
consolidated balance sheet of the Guarantor and its Subsidiaries as at the
end of such fiscal quarter and the related unaudited statements of
earnings, stockholders' equity and cash flows for the portion of the fiscal
year through such fiscal quarter (and as to the statements of earnings for
such fiscal quarter) in each case setting forth in comparative form the
figures for the corresponding periods of the
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previous fiscal year, prepared in reasonable detail and in accordance with
GAAP applied consistently throughout the periods reflected therein and
certified by the chief financial or accounting officer of the Guarantor as
presenting fairly in all material respects the financial condition and
results of operations of the Guarantor and its Subsidiaries (subject to
normal year-end adjustments);
(e) Lease Events of Defaults. Promptly after a Lessee or the
Guarantor has actual knowledge of the occurrence of any Lease Event of
Default, Potential Lease Event of Default, Manufacturer Event of Default,
Potential Manufacturer Event of Default, a written statement of an
Authorized Officer of such Person describing such event and the action that
such Lessee or the Guarantor proposes to take with respect thereto;
(f) Monthly Vehicle Statements. On or before the third Reporting
Date following the date hereof, and on each Reporting Date thereafter, a
monthly vehicle statement (each, a "Monthly Vehicle Statement") in a form
acceptable to the Lessor, which shall specify (i) the last eight digits of
the VIN for the Vehicles leased hereunder during the Related Month by each
Lessee, (ii) whether each such Vehicle is leased under Annex A or Annex B
hereto; (iii) the Capitalized Cost for such Vehicles, (iv) the aggregate
Net Book Value of such Vehicles as of the end of the Related Month, (v) the
VINs for those Vehicles leased hereunder during the Related Month that have
been delivered to Manufacturers or designated auction sites pursuant to the
applicable Vehicle Disposition Program, or that have been otherwise sold,
during the Related Month, (vi) those Vehicles leased hereunder during the
Related Month that have become a Casualty during the Related Month and
their respective Net Book Values (as of the earlier of the last day of such
Related Month and the date such Vehicle is disposed of or becomes a
Casualty, as applicable), (vii) the total amount of Monthly Base Rents,
Monthly Variable Rents, Monthly Finance Rents, Monthly Supplemental
Payments, Availability Payment, Termination Payments and Late Return
Payments due for the Related Month on such Due Date, (viii) all prepayments
of Rent received during the Related Month from Guaranteed Payments,
Repurchase Payments, Disposition Proceeds and Incentive Payments received
by the Lessor during the Related Month from the Manufacturers, auctions and
other Persons, as the case may be, (ix) the aggregate Depreciation Charges
for all Vehicles leased hereunder during the Related Month continuing in
the possession of each Lessee, (x) information with respect to each Lessee
necessary for the Master Servicer to compute the Aggregate Asset Amount of
the Group II Series of Notes as of the end of the Related Month, (xi)
information with respect to each Lessee necessary for the Master Servicer
to compute the Availability Payment for each Lessee with respect to the
Related Month, and (xii) any other charges owing from, and credits due to,
each Lessee under this Lease;
(g) Annual Certificate. Each Lessee will deliver to RCFC, the
Trustee, any applicable Enhancement Provider under the Indenture, and the
Rating Agencies rating any outstanding Series of Notes, on or before April
15 of each calendar year, beginning
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with April 15, 1998, an Officers' Certificate substantially in the form of
Attachment E (each, an "Annual Certificate") (a) stating that a review of
the activities of the Lessee during the preceding calendar year (or during
the initial period from the initial Closing Date until April 15, 1998) and
of its performance under this Lease and the other Related Documents to
which each Lessee is a party was made under the supervision of the officers
signing such certificate, (b) stating that to the best of such officers'
knowledge, based on such review, either there has occurred no event which,
with the giving of notice or passage of time or both, would constitute a
Lease Event of Default or Amortization Event and that such Lessee has fully
performed all its obligations under this Lease and such other Related
Documents throughout such year, or, if there has occurred such event or a
Lease Event of Default or Amortization Event, specifying each such event
known to such officers and the nature and status thereof, and (c) stating
(and containing an Opinion of Counsel to the effect) that all necessary
Uniform Commercial Code continuation statements and other Uniform
Commercial Code filings have been completed (including, without limitation,
any "precautionary filings" made by each of the Lessees in favor of the
Lessor), all necessary Assignment Agreements have been executed and
delivered pursuant to Section 2.1 of the Master Collateral Agency
Agreement, and all other actions, if any, required to maintain the
perfected security interest of the Trustee or the Master Collateral Agent
on behalf of the Trustee in the Collateral and in the Master Collateral
(except for noting the Lien of the Master Collateral Agent on the
Certificates of Title for the Existing Fleet), have been taken and that the
Trustee or the Master Collateral Agent continues to have a perfected
security interest in the Collateral and Master Collateral;
(h) Initial Report; Annual Reports. An initial report and annual
reports of independent public accountants as follows: On or before October
15, 1998 and on or before April 15 of each calendar year thereafter, the
Master Servicer shall cause a firm of nationally recognized independent
public accountants (who may also render other services to the Master
Servicer) to furnish a report to RCFC, the Trustee, the Rating Agencies and
any Enhancement Provider to the effect that (i) they have compared the
mathematical calculations of each amount set forth in the monthly
certificates forwarded by the Master Servicer pursuant to this Lease and
the Master Collateral Agency Agreement during the period covered by such
report (which with respect to the initial report shall be the period from
the closing date to April 30, 1998, and which with respect to each annual
report shall be the period from January 1 to and including December 31 of
the prior calendar year) with the Master Servicer's computer reports which
were the source of such amounts and that on the basis of such comparison,
such accountants are of the opinion that such amounts are in agreement,
except for such exceptions as they believe to be immaterial and such other
exceptions as shall be set forth in such statement, and (ii) they have
examined certain documents and the records relating to the servicing of the
Vehicles leased by such Lessee under this Lease and the other Related
Documents to which the Master Servicer or such Lessee is a party and that,
on the basis of such examination, nothing has come to the attention of such
accountants that would cause such
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accountants to believe that such servicing (including the allocations of
Collections under the Indenture) has not been completed in compliance with
all of the terms and conditions set forth in the Base Indenture, any Series
Supplement, this Lease and the Master Collateral Agency Agreement, except
for (a) such exceptions as such accountants believe to be immaterial and
(b) such other exceptions as shall be set forth in such report, the Master
Servicer shall serve as agent for the users of the report in determining
the sufficiency of such procedure;
(i) Quarterly Non-Program Vehicle Report. Quarterly reports of
independent public accountants as follows: On or before the second
Determination Date immediately following each March 31, June 30, September
30, and December 31 of each year, beginning with March 31, 1998, the Master
Servicer shall cause a firm of nationally recognized independent public
accountants (who may also render other services to the Master Servicer and
who is acceptable to the Rating Agencies) to furnish a report (the
"Quarterly Non-Program Vehicle Report") to the Lessor, the Trustee, the
Rating Agencies and the Master Collateral Agent to the effect that they
have performed certain agreed upon procedures with respect to the
calculation of Disposition Proceeds obtained from the sale or other
disposition of all Non-Program Vehicles (other than Casualties) sold or
otherwise disposed of during each Related Month in such period and compared
such calculations of Disposition Proceeds with the corresponding amounts
set forth in the Daily Reports prepared by the Master Servicer pursuant to
clause (a) above and that on the basis of such comparison such accountants
are of the opinion that such amounts are in agreement, except for such
exceptions as they believe to be immaterial and such other exceptions as
shall be set forth in such report, the Master Servicer shall serve as agent
for the users of the report in determining the sufficiency of such
procedure;
(j) Notice of Final Judgment. Promptly, provide to Moody's notice of
any final judgment rendered against the Lessor; and
(k) Other. From time to time, such other information, documents, or
reports regarding the Vehicles or the financial position, the results of
operations or business of the Lessees as the Lessor, the Master Collateral
Agent or the Trustee may from time to time reasonably request in order to
protect the interests of the Lessor, the Master Collateral Agent or the
Trustee under or as contemplated by this Lease or any other Related
Document.
Section 24.5. Taxes and Liabilities. Pay when due all taxes, assessments
and other material (determined on a consolidated basis) liabilities (including,
without limitation, taxes, titling fees and registration fees payable with
respect to Vehicles), except as contested in good faith and by appropriate
proceedings (but only if and so long as forfeiture of any material part of the
Vehicles leased under this Lease will not result from the failure to pay any
such taxes, assessments or other material liabilities during the period of any
such contest) and with respect to
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which (a) adequate reserves have been established, and are being maintained, in
accordance with GAAP, and (b) the failure to make such payments and the
maintaining of such reserves would not have a Material Adverse Effect on such
Person or a Material Adverse Effect on the Noteholders.
Section 24.6. Compliance with Laws. Comply with all Requirements of Law
related to its businesses if the failure so to comply would have a Material
Adverse Effect on such Person.
Section 24.7. Maintenance of Separate Existence. Maintain certain
policies and procedures relating to its existence as a separate corporation as
follows: Each Lessee acknowledges its receipt of a copy of that certain opinion
letter issued by Mayer, Brown & Platt, dated as of the Closing Date for the
Series 1998-1 Notes as the initial Series of Notes included in the Group II
Series of Notes and addressing the issue of substantive consolidation as it may
relate to the Lessees and the Lessor. Each Lessee hereby agrees to maintain in
place all policies and procedures, and take and continue to take all actions,
described in the factual assumptions set forth in such opinion letter and
relating to such Lessee; provided, however, that such Lessee may cease to
maintain any policy or procedure if and to the extent that such Lessee delivers
to the Lessor and the Trustee an Opinion of Counsel providing that such policy
or procedure is no longer necessary, due to a change in law or otherwise, for
the rendering of such earlier opinion relating to the issue of substantive
consolidation.
Section 24.8. Master Collateral Agent as Lienholder. Maintain certain
computer records as follows: Concurrently with each leasing of a Vehicle under
this Lease, the Master Servicer and the related Servicer each shall indicate on
its computer records that the Master Collateral Agent as assignee of the Lessor
or the Lessees, as the case may be, is the holder of a Lien on such Vehicle for
the benefit of the Trustee pursuant to the terms of the Master Collateral
Agency Agreement.
Section 24.9. Maintenance of Property. Keep, or cause to be kept, all
property useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted; provided, that nothing in this
Section 24.9 shall require it to maintain, or to make any renewals,
replacements, additions, betterment or improvements of or to, any tangible
property if such property, in its reasonable opinion, is obsolete or surplus or
unfit for use or cannot be used advantageously in the conduct of its business.
Section 24.10. Access to Certain Documentation and Information Regarding
the Collateral. Provide to the Trustee and the Master Collateral Agent
reasonable access to the documentation regarding the Collateral and the Master
Collateral, such access being afforded without charge but only (i) upon
reasonable request, (ii) during normal business hours, (iii) subject to the
normal security and confidentiality procedures of the applicable Lessee, the
applicable Servicer or the Master Servicer, as the case may be, and (iv) at
offices in the continental United States designated by such Lessee, such
Servicer or the Master Servicer, as the
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case may be, which, if they are not the offices where such documentation
normally is kept, shall be accessible without unreasonable effort or expense.
In addition, commencing on the date ten (10) days after the date that a
Lessee or the Master Servicer receives from the Trustee or any Note Owner of
any Note included in the Group II Series of Notes a written request therefor,
which request shall (x) contain a certification of such Note Owner that such
person is a Note Owner and (y) provide an address for delivery, then and
thereafter, unless and until such Lessee or the Master Servicer receives from
such Note Owner a request to discontinue same, the Lessee or the Master
Servicer, as applicable, shall deliver the information specified below directly
to such Note Owner (and, if requested, to one other person as may be specified
in such Note Owner's written request) substantially concurrently with the
delivery by such Lessee or the Master Servicer, as applicable, of such
information to any of the Trustee, any Holder of any Note included in the Group
II Series of Notes or RCFC, provided, however, if such Lessee or the Master
Servicer, as applicable, is not otherwise obligated hereunder to deliver such
information to the Trustee, any Holder of any Note included in the Group II
Series of Notes or RCFC on a periodic basis, then, unless otherwise specified
below, such Lessee or the Master Servicer, as applicable, shall deliver the
following information to such Note Owner on a monthly basis on the same date as
the date on which the Monthly Certificate delivered pursuant to Section 24.4(b)
is delivered:
(i) the Monthly Certificate delivered pursuant to Section
24.4(b);
(ii) the average age of the Lessor's fleet (with respect to
the Vehicles in the Lessor's Fleet that are Group II Vehicles
as of such date);
(iii) copies of any new Vehicle Disposition Programs entered
into by RCFC during the Related Month;
(iv) a statement as to whether a Manufacturer Event of
Default or Lease Event of Default occurred during the Related
Month;
(v) any financial reports required to be delivered under this
Lease;
(vi) the Annual Certificate delivered hereunder;
(vii) the Annual Report delivered hereunder;
(viii) the Quarterly Non-Program Vehicle Report; and
(ix) within ten (10) days after written request, such other
information as is reasonably requested by such Note Owner in
order to satisfy any regulatory requirements of such Note
Owner.
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SECTION 24.11. Maintenance of Credit Enhancement. The Guarantor
agrees to maintain with respect to each Series of Notes included in the Group
II Series of Notes a letter of credit supporting the obligations of the Lessees
under this Lease in a stated amount that is at least equal to the Minimum
Letter of Credit Amount, if any, for such Series of Notes.
SECTION 24.12. Certain Additional Actions. The Master Servicer and
each Servicer shall from time to time, as and when specified in the applicable
Series Supplement for any Series of Notes included in the Group II Series of
Notes, provide such notices to the Trustee and to such other Persons specified
in such Series Supplement, and perform such other actions, as are in each case
specified therein, including without limitation any notices relating to any
letters of credit or other Enhancement provided for under such Series
Supplement, and the establishment of any cash collateral accounts relating
thereto. Without limiting the foregoing, the Master Servicer hereby agrees, in
connection with the Series 1998-1 Supplement, to
(a) provide timely notice to the Trustee as described in
Sections 4.16(a) and 4.16(b) of the Series 1998-1 Supplement upon
satisfaction of the conditions for such notice set forth therein;
(b) establish a new Series 1998-1 Cash Collateral Account
which complies with the terms of Section 4.18(a)of the Series 1998-1
Supplement if the existing Series 1998-1 Cash Collateral Account is
not maintained in accordance with such terms, and instruct the Trustee
to transfer into the new Series 1998-1 Cash Collateral Account all
cash and investments from the non-qualifying Series 1998-1 Cash
Collateral Account, in each case as specified in Section 4.18(a) of
the Series 1998-1 Supplement;
(c) direct (or designate in writing, with notice thereof to
the Trustee, a Person to direct) the investment in Permitted
Investments of funds held in the Series 1998-1 Cash Collateral Account
as specified in Section 4.18(c) of the Series 1998-1 Supplement; and
(d) give such other notices and instructions to the Trustee
as are specified in the Series 1998-1 Supplement.
Section 24.13. Minimum Depreciation Rate. Each Servicer and the
Master Servicer agree that the scheduled daily depreciation charge with respect
to Non-Program Vehicles leased under this Lease shall be established such that
the weighted average Depreciation Charges accruing with respect to each
Non-Program Vehicle during each Related Month shall be at least equal to 1.0%.
Section 24.14. Minimum Fixed Charge Coverage and Interest Coverage
Ratios. On and after the Lease Commencement Date, the Guarantor will not
permit (a) the Interest Coverage Ratio, as of the last day of each Fiscal
Quarter, commencing with the second Fiscal Quarter of the 1998 Fiscal Year of
DTAG, to be less than the ratio of 1.1:1.0, and (b) the Fixed Charge
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Coverage Ratio, commencing with the fourth Fiscal Quarter of the 1998 Fiscal
Year, to be less than the ratio of 1.0:1.0.
Section 24.15. Dividends or other Distributions by Guarantor. On and
after the Lease Commencement Date, DTAG will not declare, pay or make any
Distribution with respect to any shares of its Capital Stock (now or hereafter
outstanding) or on any warrants, options or other rights with respect to any
such shares of Capital Stock (now or hereafter outstanding) or apply, or permit
any of its Subsidiaries to apply, any of its funds, property or assets to the
purchase, redemption, sinking fund or other retirement of, or agree or permit
any of its Subsidiaries to purchase or redeem, any shares of any class of
Capital Stock (now or hereafter outstanding) of the DTAG, or warrants, options
or other rights with respect to any such shares of Capital Stock (now or
hereafter outstanding) of DTAG; provided, however, that the DTAG may declare,
pay and make cash Distributions to its stockholders in any Fiscal Year, so long
as
(i) both before and after giving effect to any such payment, no Lease
Event of Default, Amortization Event, Liquidation Event of Default or
Series 1998-1 Limited Liquidation Event of Default shall have occurred
and be continuing,
(ii) the aggregate amount of such Distribution to be made by DTAG
pursuant to this Section 24.15, when added to the aggregate amount of
all such Distributions during the Fiscal Year in which such
Distribution would be made, does not exceed the amount set forth below
opposite such Fiscal Year
<TABLE>
<CAPTION>
FISCAL YEAR AMOUNT
----------- ------
<S> <C>
1998 Fiscal Year $1,000,000
1999 Fiscal Year The lesser of (i) 25% of
Excess Cash Flow for the
1998 Fiscal Year and
(ii) $2,000,000
2000 Fiscal Year The lesser of (i) 25% of
Excess Cash Flow for the
1999 Fiscal Year and
(ii) $4,000,000
2001 Fiscal Year The lesser of (i) 25% of
Excess Cash Flow for the
2000 Fiscal Year and
(ii) $6,000,000
</TABLE>
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<PAGE> 47
<TABLE>
<CAPTION>
FISCAL YEAR AMOUNT
----------- ------
<S> <C>
2002 Fiscal Year The lesser of (i) 25% of
Excess Cash Flow for the
2001 Fiscal Year and
(ii) $8,000,000
</TABLE>
SECTION 25. CERTAIN NEGATIVE COVENANTS. Until the expiration or
termination of this Lease and thereafter until the obligations of the Lessees
are paid in full, each Lessee agrees that, unless at any time the Lessor, the
Master Collateral Agent and the Trustee shall otherwise expressly consent in
writing, it will not:
Section 25.1. Mergers, Consolidations. Be a party to any merger or
consolidation, other than a merger or consolidation of such Lessee into or with
another entity if:
(a) the Person formed by such consolidation or into or with
which such Lessee is merged shall be a Person organized and existing under
the laws of the United States of America or any State or the District of
Columbia, and, if such Lessee is not the surviving entity, shall expressly
assume, by an agreement supplemental hereto executed and delivered to the
Trustee, the performance of every covenant and obligation of such Lessee
hereunder and under all other Related Documents;
(b) such Lessee has delivered to the Trustee an officer's
certificate and an opinion of counsel each stating that such consolidation
or merger and such supplemental agreement comply with this Section 25.1 and
that all conditions precedent herein provided for relating to such
transaction have been complied with; and
(c) the Rating Agency Condition shall be met with respect to
such assignment and succession.
Section 25.2. Other Agreements. Enter into any agreement containing any
provision which would be violated or breached by the performance of its
obligations hereunder or under any instrument or document delivered or to be
delivered by it hereunder or in connection herewith.
Section 25.3. Liens. Create or permit to exist any Lien with respect to
any Vehicle leased hereunder now or hereafter existing or acquired, except
Liens in favor of the Lessor, the Master Collateral Agent or the Trustee, the
lien on the Financed Vehicles in favor of the Series 1998-1 Letter of Credit
Provider, and the Liens set forth in Schedule 4, if any, and the following
Liens to the extent such liens in the aggregate would not have a Material
Adverse Effect on the Lessor, the Master Collateral Agent or the Trustee or the
Noteholders under this Lease or the Indenture
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<PAGE> 48
(all the foregoing Liens collectively, the "Permitted Liens"): (i) Liens for
current taxes not delinquent or for taxes being contested in good faith and by
appropriate proceedings, and with respect to which adequate reserves have been
established, and are being maintained, in accordance with GAAP, (ii) Liens,
including judgment liens, arising in the ordinary course of business being
contested in good faith and by appropriate proceedings, and with respect to
which adequate reserves have been established, and are being maintained, in
accordance with GAAP, (iii) Liens incurred in the ordinary course of business
in connection with worker's compensation, unemployment insurance or other forms
of governmental insurance or benefits, and (iv) mechanics' materialmen's,
landlords', warehousemen's and carrier's Liens, and other Liens imposed by law,
securing obligations arising in the ordinary course of business that are being
contested in good faith and by appropriate proceedings and with respect to
which adequate reserves have been established, and are being maintained, in
accordance with GAAP.
Section 25.4. Use of Vehicles. Knowingly use or allow the Program
Vehicles to be used in any manner that would (i) make any such Program Vehicles
ineligible for repurchase by their respective Manufacturers or for sale in
accordance with applicable Auction Procedures, except with respect to the
permitted redesignation of Program Vehicles as Non- Program Vehicles, pursuant
to Section 14, or (ii) subject the Vehicles to confiscation.
SECTION 26. SERVICING COMPENSATION.
Section 26.1. As compensation for its servicing activities hereunder and
reimbursement for its expenses as set forth in Section 26.2, each Servicer and
the Master Servicer shall be entitled to receive from the Lessor a monthly
servicing fee (the "Monthly Servicing Fee"), payable in arrears on each Payment
Date prior to the termination of this Lease, the Indenture and the Master
Collateral Agency Agreement in an amount equal to the sum of the monthly
servicing fees for all Series of Notes included in the Group II Series of
Notes. Except as otherwise specified in the related Series Supplement, the
Monthly Servicing Fee for each Series of Notes included in the Group II Series
of Notes (each, a "Series Monthly Servicing Fee") on each Payment Date shall be
equal to (i) the portion of the Group II Supplemental Servicing Fee allocated
to such Group II Series of Notes pursuant to the related Series Supplement,
plus (ii) one- twelfth of the product of (A) the Servicing Fee Percentage for
such Series and (B) the Invested Amount of such Series as of the preceding
Payment Date (after giving effect to any payments of principal on such date).
The Series Monthly Servicing Fee for each Series of Notes included in the Group
II Series of Notes shall be paid to the Master Servicer (for allocation among
the Master Servicer and the Servicers) pursuant to the procedures set forth in
the applicable Supplement. The supplemental servicing fee (the "Group II
Supplemental Servicing Fee") for any period shall be equal to all Carrying
Charges comprising payments due from the Servicers under Section 26.2 hereof.
Section 26.2. The expenses of each Servicer include, and each Servicer
agrees to pay, its Pro Rata Share of the amounts due to the Trustee pursuant to
Section 9.5 of the Base Indenture and allocable to the Group II Series of
Notes, plus its Pro Rata Share of the reasonable fees and
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disbursements of independent accountants in connection with reports furnished
pursuant to Sections 24.4(h) and (i), plus its allocable share of all other
fees, expenses and indemnities incurred by such Servicer or the Lessor in
connection with the Servicer's activities hereunder or under the Related
Documents. The Servicers, however, shall not be liable for any liabilities,
costs or expenses of the Lessor, the Trustee or the Holders of Notes included
in the Group II Series of Notes arising under any tax law, including without
limitation any Federal, state or local income or franchise taxes or any other
tax imposed on or measured by income (or any interest or penalties with respect
thereto or arising from a failure to comply therewith), except to the extent
incurred as a result of a Servicer's violation of the provisions of this Lease
or of the Related Documents; provided, however, the foregoing provisions of
this sentence shall not affect the indemnification obligations of the Lessees
under Section 15 of this Lease. In the event that a Servicer fails to pay any
amount due to the Trustee pursuant to Section 9.5 of the Base Indenture, the
Trustee will be entitled to receive such amounts due from the Monthly Servicing
Fee prior to payment thereof to such Servicer.
SECTION 27. GUARANTY.
Section 27.1. Guaranty. In order to induce the Lessor to execute and
deliver this Lease and to lease Vehicles hereunder to the Lessees, and in
consideration thereof, the Guarantor hereby (i) unconditionally and irrevocably
guarantees to the Lessor the obligations of each of the Lessees to make any
payments required to be made by them under this Lease, (ii) agrees to cause
each Lessee to duly and punctually perform and observe all of the terms,
conditions, covenants, agreements and indemnities applicable to such Lessee
(whether in its capacity as a Lessee or as a Servicer) under this Lease, and
(iii) agrees that, if for any reason whatsoever, any Lessee (whether in its
capacity as a Lessee or as a Servicer) fails to so perform and observe such
terms, conditions, covenants, agreements and indemnities, the Guarantor will
duly and punctually perform and observe the same (the obligations referred to
in clauses (i) through (iii) above are collectively referred to as the
"Guaranteed Obligations"). The liabilities and obligations of the Guarantor
under the guaranty contained in this Section 27 (this "Guaranty") will be
absolute and unconditional under all circumstances. This Guaranty shall be a
guaranty of payment and not of collection, and the Guarantor hereby agrees that
it shall not be required that the Lessor or the Trustee assert or enforce any
rights against any of the Lessees, the Servicers or any other person before or
as a condition to the obligations of the Guarantor pursuant to this Guaranty.
Section 27.2. Scope of Guarantor's Liability. The Guarantor's obligations
hereunder are independent of the obligations of the Lessees (whether as Lessee
or as Servicer), any other guarantor or any other Person, and the Lessor may
enforce any of its rights hereunder independently of any other right or remedy
that the Lessor may at any time hold with respect to this Lease or any security
or other guaranty therefor. Without limiting the generality of the foregoing,
the Lessor may bring a separate action against the Guarantor without first
proceeding against any of the Lessees, any other guarantor or any other Person,
or any security held by the Lessor, and regardless of whether the Lessees or
any other guarantor or any other Person is
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joined in any such action. The Guarantor's liability hereunder shall at all
times remain effective with respect to the full amount due from the Lessees
hereunder. The Lessor's rights hereunder shall not be exhausted by any action
taken by the Lessor until all Guaranteed Obligations have been fully paid and
performed.
Section 27.3. Lessor's Right to Amend this Lease. The Guarantor
authorizes the Lessor, at any time and from time to time without notice and
without affecting the liability of the Guarantor hereunder, to: (a) alter the
terms of all or any part of the Guaranteed Obligations and any security and
guaranties therefor including without limitation modification of times for
payment and rates of interest; (b) accept new or additional instruments,
documents, agreements, security or guaranties in connection with all or any
part of the Guaranteed Obligations; (c) accept partial payments on the
Guaranteed Obligations; (d) waive, release, reconvey, terminate, abandon,
subordinate, exchange, substitute, transfer, compound, compromise, liquidate
and enforce all or any part of the Guaranteed Obligations and any security or
guaranties therefor, and apply any such security and direct the order or manner
of sale thereof (and bid and purchase at any such sale), as the Lessor in its
discretion may determine; (e) release any Lessee, any guarantor or any other
Person from any personal liability with respect to all or any part of the
Guaranteed Obligations; and (f) assign its rights under this Guaranty in whole
or in part.
Section 27.4. Waiver of Certain Rights by Guarantor. The Guarantor hereby
waives each of the following to the fullest extent allowed by law:
(a) any defense based upon:
(i) the unenforceability or invalidity of any security or
other guaranty for the Guaranteed Obligations or the
lack of perfection or failure of priority of any
security for the Guaranteed Obligations; or
(ii) any act or omission of the Lessor or any other Person
that directly or indirectly results in the discharge
or release of any of the Lessees or any other Person
or any of the Guaranteed Obligations or any security
therefor; provided that the Guarantor's liability in
respect of this Guaranty shall be released to the
extent the Lessor expressly releases such Lessee or
other Person, in a writing conforming to the
requirements of Section 22, from any Guaranteed
Obligations; or
(iii) any disability or any other defense of any Lessee or
any other Person with respect to the Guaranteed
Obligations, whether consensual or arising by
operation of law or any bankruptcy, insolvency or
debtor-relief proceeding, or from any other cause;
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<PAGE> 51
(b) any right (whether now or hereafter existing) to require the
Lessor, as a condition to the enforcement of this Guaranty, to:
(i) accelerate the Guaranteed Obligations;
(ii) give notice to the Guarantor of the terms, time and
place of any public or private sale of any security
for the Guaranteed Obligations; or
(iii) proceed against any Lessee, any other guarantor or
any other Person, or proceed against or exhaust any
security for the Guaranteed Obligations;
(c) presentment, demand, protest and notice of any kind, including
without limitation notices of default and notice of acceptance of this
Guaranty;
(d) all suretyship defenses and rights of every nature otherwise
available under New York law and the laws of any other jurisdiction;
(e) any right that the Guarantor has or may have to set-off with
respect to any right to payment from any Lessee; and
(f) all other rights and defenses the assertion or exercise of which
would in any way diminish the liability of the Guarantor hereunder.
Section 27.5. Lessees' Obligations to Guarantor and Guarantor's
Obligations to Lessees Subordinated. Until all of the Guaranteed Obligations
have been paid in full, the Guarantor agrees that all existing and future
unsecured debts, obligations and liabilities of the Lessees to the Guarantor or
the Guarantor to any of the Lessees (hereinafter collectively referred to as
"Subordinated Debt") shall be and hereby are expressly subordinated to the
prior payment in full of the Guaranteed Obligations, on the terms set forth in
clauses (a) through (e) below, and the payment thereof is expressly deferred in
right of payment to the prior payment in full of the Guaranteed Obligations.
For purposes of this Section 27.5, to the extent the Guaranteed Obligations
consist of the obligation to pay money, the Guaranteed Obligations shall not be
deemed paid in full unless and until paid in full in cash.
(a) Upon any distribution of assets of the Guarantor or any Lessee
upon any dissolution, winding up, liquidation or reorganization of the
Guarantor or such Lessee, whether in bankruptcy, insolvency, reorganization or
receivership proceedings, or upon an assignment for the benefit of creditors or
any other marshaling of the assets and liabilities of the Guarantor or such
Lessee, or otherwise:
(i) the holders of the Guaranteed Obligations shall be
entitled to receive payment in full of the Guaranteed
Obligations before the Guarantor or any
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Lessee, as the case may be, is entitled to receive
any payment on account of the Subordinated Debt;
(ii) any payment by, or distribution of assets of, the
Guarantor or such Lessee of any kind or character,
whether in cash, property or securities, to which
such Lessee or the Guarantor would be entitled except
for this subordination shall be paid or delivered by
the Person making such payment or distribution,
whether a trustee in bankruptcy, a receiver or
liquidating trustee, or otherwise, directly to the
Trustee, for the benefit of the holders of the
Guaranteed Obligations to be held as additional
security for the Guaranteed Obligations in an
interest bearing account until the Guaranteed
Obligations have been paid in full; and
(iii) if, notwithstanding the foregoing, any payment by, or
distribution of assets of, the Guarantor or such
Lessee of any kind or character, whether in cash,
property or securities, in respect of any
Subordinated Debt shall be received by such Lessee or
the Guarantor before the Guaranteed Obligations are
paid in full, such payment or distribution shall be
held in trust in an interest bearing account of the
Guarantor or such Lessee, as appropriate, and
immediately paid over in kind to the holders of the
Guaranteed Obligations until the Guaranteed
Obligations have been paid in full.
(b) The Guarantor authorizes and directs each Lessee and each Lessee
authorizes and directs the Guarantor to take such action as may be necessary or
appropriate to effectuate and maintain the subordination provided herein.
(c) No right of any holder of the Guaranteed Obligations to enforce
the subordination herein shall at any time or in any way be prejudiced or
impaired by any act or failure to act on the part of the Guarantor, any Lessee,
the Lessor or any other Person or by any noncompliance by the Guarantor, any
Lessee, the Lessor or any other Person with the terms, provisions and covenants
hereof or of the Related Documents regardless of any knowledge thereof that any
such holder of the Guaranteed Obligations may have or be otherwise charged
with.
(d) Except as provided in Section 27.9, nothing express or implied
herein shall give any Person other than the Lessees, the Lessor, the Trustee
and the Guarantor any benefit or any legal or equitable right, remedy or claim
hereunder.
(e) If the Guarantor shall institute or participate in any suit,
action or proceeding against any Lessee or any Lessee shall institute or
participate in any suit, action or proceeding against the Guarantor, in
violation of the terms hereof, such Lessee or the Guarantor, as the case may
be, may interpose as a defense or dilatory plea this subordination, and the
holders of the Guaranteed
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Obligations are irrevocably authorized to intervene and to interpose such
defense or plea in their name or in the name of such Lessee or the Guarantor,
as the case may be.
Section 27.6. Guarantor to Pay Lessor's Expenses. The Guarantor
agrees to pay to the Lessor (or the Trustee), on demand, all costs and
expenses, including reasonable attorneys' and other professional and
paraprofessional fees, incurred by the Lessor (or the Trustee) in exercising
any right, power or remedy conferred by this Guaranty, or in the enforcement of
this Guaranty, whether or not any action is filed in connection therewith.
Until paid to the Lessor, such amounts shall bear interest, commencing with the
Lessor's demand therefor, for each Interest Period during the period from the
date of such demand until paid, at the VFR for such Interest Period plus 1%
(calculated on the basis of a 360-day year).
Section 27.7. Reinstatement. This Guaranty shall continue to be
effective or be reinstated, as the case may be, if at any time payment of any
of the amounts payable by any Lessee under this Lease is rescinded or must
otherwise be restored or returned by the Lessor, upon an event of bankruptcy,
dissolution, liquidation or reorganization of any Lessee or the Guarantor or
upon or as a result of the appointment of a receiver, intervenor or conservator
of, or trustee or similar officer for, any Lessee, the Guarantor, any other
Guarantor or any other Person, or any substantial part of their respective
property, or otherwise, all as though such payment had not been made.
Section 27.8. Pari Passu Indebtedness. The Guarantor (i) represents
and warrants that, as of the date hereof, the obligations of the Guarantor
under this Guaranty will rank pari passu with any existing unsecured
indebtedness of the Guarantor and (ii) covenants and agrees that from and after
the date hereof the obligations of the Guarantor under this Guaranty will rank
pari passu with any unsecured indebtedness of the Guarantor incurred after the
date hereof.
Section 27.9. Third-Party Beneficiaries. The Guarantor acknowledges
that the Trustee (on behalf of the Holders of Notes included in the Group II
Series of Notes) has accepted the assignment of the Lessor's rights under this
Lease as collateral for such Notes in reliance on the Guaranty and that the
Trustee (for the benefit of the Holders of such Notes) shall be a third-party
beneficiary hereunder.
SECTION 28. ADDITIONAL LESSEES.
Section 28.1. Additional Lessees. Any direct or indirect Subsidiary
of the Guarantor (each, a "Guarantor Subsidiary") shall have the right to
become a "Lessee" under and pursuant to the terms of this Lease by complying
with the provisions of this Section 28.1. In the event a Guarantor Subsidiary
desires to become a "Lessee" under this Lease, then the Guarantor and such
Guarantor Subsidiary shall execute (if appropriate) and deliver to the Lessor
and the Trustee:
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(a) a Joinder in Lease Agreement in the form attached hereto
as Attachment D (each, an "Affiliate Joinder in Lease");
(b) the certificate of incorporation for such Guarantor
Subsidiary, duly certified by the Secretary of State of the
jurisdiction of such Guarantor Subsidiary's incorporation, together
with a copy of the by-laws of such Guarantor Subsidiary, duly
certified by a Secretary or Assistant Secretary of such Guarantor
Subsidiary;
(c) copies of resolutions of the Board of Directors of such
Guarantor Subsidiary authorizing or ratifying the execution, delivery
and performance, respectively, of those documents and matters required
of it with respect to this Lease, duly certified by the Secretary or
Assistant Secretary of such Guarantor Subsidiary;
(d) a certificate of the Secretary or Assistant Secretary of
such Guarantor Subsidiary certifying the names of the individual or
individuals authorized to sign the Affiliate Joinder in Lease and the
other Related Documents to be executed by it, together with samples of
the true signatures of each such individual;
(e) a good standing certificate for such Guarantor
Subsidiary in the jurisdiction of its incorporation and the
jurisdiction of its principal place of business;
(f) a written search report from a Person satisfactory to
the Lessor and the Trustee listing all effective financing statements
that name such Guarantor Subsidiary as debtor or assignor, and that
are filed in the jurisdictions in which filings were made pursuant to
clause (g) below, together with copies of such financing statements,
and tax and judgment lien search reports from a Person satisfactory to
the Lessor and the Trustee showing no evidence of liens filed against
such Guarantor Subsidiary that purport to affect any Vehicles leased
hereunder or any Collateral under the Indenture;
(g) evidence of the filing of proper financing statements on
Form UCC-1 naming such Guarantor Subsidiary, as debtor, and the Lessor
as secured party covering the collateral described in Section 2(b)
hereof;
(h) an Officers' Certificate and an opinion of counsel each
stating that such joinder by such Guarantor Subsidiary complies with
this Section 28.1 and that all conditions precedent herein provided
for relating to such transaction have been complied with;
(i) a statement from each of the Rating Agencies that such
Guarantor Subsidiary becoming a "Lessee" under this Lease will not
cause a failure to meet the Rating Agency Condition; and
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(j) any additional documentation that the Lessor or the
Trustee may reasonably require to evidence the assumption by such
Guarantor Subsidiary of the obligations and liabilities set forth in
this Lease.
Upon satisfaction of the foregoing conditions and receipt by such Guarantor
Subsidiary of the applicable Affiliate Joinder in Lease executed by the Lessor,
such Guarantor Subsidiary shall for all purposes be deemed to be a "Lessee" for
purposes of this Lease (including, without limitation, the Guaranty which is a
part of this Lease) and shall be entitled to the benefits and subject to the
liabilities and obligations of a Lessee hereunder.
SECTION 29. BANKRUPTCY PETITION AGAINST LESSOR. Each Lessee and the
Guarantor hereby covenants and agrees that, prior to the date which is one year
and one day after the payment in full of all Series of Notes issued by the
Lessor, it will not institute against, or join any other Person in instituting
against, the Lessor any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings or other similar proceeding under the laws of the
United States or any state of the United States. In the event that a Lessee
(or any sublessee thereof) or the Guarantor takes action in violation of this
Section 29, the Lessor agrees, for the benefit of the Noteholders, that it
shall file an answer with the bankruptcy court or otherwise properly contest
the filing of such a petition by such Lessee or the Guarantor against the
Lessor or the commencement of such action and raise the defense that such
Lessee or the Guarantor, as applicable, has agreed in writing not to take such
action and should be estopped and precluded therefrom and such other defenses,
if any, as its counsel advises that it may assert. The provisions of this
Section 29 shall survive the termination of this Lease.
SECTION 30. SUBMISSION TO JURISDICTION. THE LESSOR, THE MASTER
COLLATERAL AGENT AND THE TRUSTEE MAY ENFORCE ANY CLAIM ARISING OUT OF THIS
LEASE IN ANY STATE OR FEDERAL COURT HAVING SUBJECT MATTER JURISDICTION,
INCLUDING, WITHOUT LIMITATION, ANY STATE OR FEDERAL COURT LOCATED IN THE STATE
OF NEW YORK IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY. FOR THE PURPOSE OF
ANY ACTION OR PROCEEDING INSTITUTED WITH RESPECT TO ANY SUCH CLAIM, EACH LESSEE
AND THE GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF SUCH
COURTS. EACH LESSEE AND THE GUARANTOR HEREBY IRREVOCABLY DESIGNATES CT
CORPORATION SYSTEM, INC., 1633 BROADWAY, NEW YORK, NEW YORK 10019, TO RECEIVE
FOR AND ON BEHALF OF SUCH LESSEE AND GUARANTOR SERVICE OF PROCESS IN NEW YORK.
EACH LESSEE AND THE GUARANTOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS OUT OF SAID COURTS BY MAILING A COPY THEREOF, BY REGISTERED MAIL,
POSTAGE PREPAID, TO SUCH LESSEE OR THE GUARANTOR, AS APPLICABLE, AND AGREES
THAT SUCH SERVICE, TO THE FULLEST EXTENT PERMITTED BY LAW, (I) SHALL BE DEEMED
IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON IT IN ANY SUCH SUIT, ACTION
OR PROCEEDING AND (II) SHALL BE TAKEN AND
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<PAGE> 56
HELD TO BE VALID PERSONAL SERVICE UPON AND PERSONAL DELIVERY TO IT. Nothing
herein contained shall affect the right of the Lessor to serve process in any
other manner permitted by law or preclude the Lessor, the Master Collateral
Agent or the Trustee from bringing an action or proceeding in respect hereof in
any other country, state or place having jurisdiction over such action. EACH
LESSEE AND THE GUARANTOR HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT LOCATED IN THE STATE OF NEW YORK IN THE BOROUGH OF MANHATTAN IN NEW YORK
CITY AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A
COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
SECTION 31. GOVERNING LAW. THIS LEASE SHALL BE A CONTRACT MADE UNDER
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES. Whenever possible each provision of this Lease
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Lease shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Lease. All obligations of the
Lessees and the Guarantor and all rights of the Lessor, the Master Collateral
Agent or the Trustee expressed herein shall be in addition to and not in
limitation of those provided by applicable law or in any other written
instrument or agreement.
SECTION 32. JURY TRIAL. EACH PARTY HERETO HEREBY EXPRESSLY WAIVES
ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND
ANY RIGHTS UNDER THIS LEASE OR ANY OTHER RELATED DOCUMENT TO WHICH IT IS A
PARTY, OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR
WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION THEREWITH OR ARISING FROM
ANY RELATIONSHIP EXISTING IN CONNECTION WITH THIS LEASE OR ANY RELATED
TRANSACTION, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED
BEFORE A COURT AND NOT BEFORE A JURY.
SECTION 33. NOTICES. All notices, requests and other communications
to any party or signatory hereunder shall be in writing (including facsimile
transmission or similar writing) and shall be given to such party or signatory,
addressed to it, at its address or facsimile number set forth on the signature
pages below, or at such other address or facsimile number as such party may
hereafter specify for such purpose by notice (in accordance with this Section
33) to the other parties and signatories hereto. In each case, a copy of all
notices, requests and other communications (other than any such notices,
requests and other communications in the ordinary course of business) that are
sent by any party or signatory hereunder shall be sent to the Trustee.
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Copies of notices, requests and other communications delivered to the Trustee
pursuant to the foregoing sentence shall be sent to the following address:
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attention: Corporate Trust and Agency
Group/Structured Finance
Telephone: (212) 250-6533
Facsimile: (212) 250-6439
Each such notice, request or communication shall be effective when received at
the address specified below. Copies of all facsimile notices must be sent by
first class mail promptly after such transmission by facsimile.
SECTION 34. HEADINGS. Section headings used in this Lease are for
convenience of reference only and shall not affect the construction of this
Lease.
SECTION 35. EXECUTION IN COUNTERPARTS. This Lease may be executed in
any number of counterparts and by different parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original and all of which counterparts, taken together,
shall constitute one and the same Agreement.
SECTION 36. EFFECTIVENESS. This Lease shall become effective on the
Lease Commencement Date, subject to (i) the requirement that the
representations and warranties contained in Section 23 shall be true and
correct in all respects (except to the extent any such representation and
warranty does not incorporate a materiality limitation in its terms and the
failure of such representation and warranty to be true and correct in all
respects does not have a Material Adverse Effect on the interest of the Lessor,
the Trustee or the Secured Parties) and (ii) the prior or concurrent delivery
of each of the following documents to the Lessor (in form and substance
satisfactory to the Lessor):
(a) Certificate of Incorporation. The certificate of
incorporation of each Lessee (other than the Additional Lessees) and
the Guarantor, duly certified by the Secretary of State of the
jurisdiction of its incorporation, together with a copy of its
by-laws, duly certified by the Secretary or an Assistant Secretary of
such Lessee or the Guarantor, as applicable;
(b) Resolutions. Copies of resolutions of the Board of
Directors of each Lessee (other than the Additional Lessees) and the
Guarantor authorizing or ratifying the execution, delivery and
performance of those documents and matters required of it with
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respect to this Lease, duly certified by the Secretary or Assistant
Secretary of such Lessee or the Guarantor, as applicable;
(c) Consents, etc. Certified copies of all documents
evidencing any necessary corporate action, consents and governmental
approvals (if any) with respect to this Lease;
(d) Incumbency and Signatures. A certificate of the
Secretary or an Assistant Secretary of each Lessee (other than the
Additional Lessees) and the Guarantor certifying the names of the
individual or individuals authorized to sign this Lease and the other
Related Documents to be executed by it (in such capacity or
otherwise), together with a sample of the true signature of each such
individual (the Lessor, the Master Collateral Agent and the Trustee
may conclusively rely on each such certificate until formally advised
by a like certificate of any changes therein);
(e) Opinions of Counsel. (i) The opinion of Mayer, Brown &
Platt, addressed to the Lessees (other than the Additional Lessees),
the Lessor, the Trustee, the Master Collateral Agent, the Enhancement
Providers and the Rating Agencies; (ii) the opinion of each
Manufacturer, as required by the Rating Agencies, addressed to the
Lessees, the Lessor, the Trustee, the Master Collateral Agent, the
Enhancement Providers and the Rating Agencies; (iii) the opinion of
counsel to each Enhancement Provider, addressed to the Lessees, the
Lessor, the Trustee, the Master Collateral Agent and the Rating
Agencies; (iv) the opinion of White & Case, counsel to the Trustee,
addressed to the Lessees, the Lessor, the Master Collateral Agent and
each Enhancement Provider; and (v) the opinion of Hall, Estill,
Hardwick, Gable, Golden & Nelson, Oklahoma counsel to the Lessees, the
Servicers and the Master Servicer addressed to the Lessor, the
Trustee, the Master Collateral Agent, the Enhancement Providers and
the Rating Agencies, in each case, satisfactory in form and substance
to the addressees thereof;
(f) Good Standing Certificates. Certificates of good
standing for each Lessee (other than the Additional Lessees) and the
Guarantor in the jurisdiction of its organization and the jurisdiction
of its principal place of business;
(g) Search Reports. Search reports satisfactory to the
Lessor and the Trustee listing all effective financing statements that
name a Lessee as debtor or assignor and that are filed in the
jurisdictions in which filings were made pursuant to subsection (h)
below, together with copies of such financing statements, and tax and
judgment lien search reports from a Person satisfactory to the Lessor
and the Trustee showing no evidence of such liens filed against such
Lessee;
(h) Evidence. Evidence of the filing of proper financing
statements on Form UCC-1, (i) naming each Lessee (other than the
Additional Lessees) as debtor and the Master Collateral Agent as
secured party or other, similar instruments or documents, as
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may be necessary or desirable under the UCC of all applicable
jurisdictions to perfect the Master Collateral Agent's interest in the
Master Collateral with respect to which the Trustee is designated as
the Beneficiary on behalf of the Holders of any Series of Notes
included in the Group II Series of Notes and (ii) naming each Lessee
(other than the Additional Lessees) as debtor, the Lessor as secured
party and the Master Collateral Agent as assignee, as may be necessary
or desirable under the UCC of all applicable jurisdictions to perfect
the security interest (with respect the Financing Lease) and the
precautionary security interest (with respect to the Operating Lease)
of the Lessor hereunder and the assignment of the same to the Master
Collateral Agent;
(i) Master Collateral Agency Agreement. An executed copy of
the Master Collateral Agency Agreement;
(j) Lease. Original counterpart No. 1 of this Lease shall be
delivered to the Trustee with receipt acknowledged thereby;
(k) Vehicle Title Nominee Agreement. An executed copy of the
Vehicle Title Nominee Agreement;
(l) Assignment Agreement. An executed copy of the Assignment
Agreement of each Manufacturer of Program Vehicles (including Existing
Vehicles) which will be leased under this Lease on the Closing Date
for the Series 1998-1 Notes;
(m) Certified Copy of Manufacturer Program. A copy of each
Manufacturer Program relating to Vehicles which will be leased
hereunder and an Officer's Certificate, dated the Closing Date for the
Series 1998-1 Notes, and duly executed by an Authorized Officer of the
Lessee, certifying that each such copy is true, correct and complete
as of the Closing Date for the Series 1998-1 Notes;
(n) The Indenture Supplement. Copies of the Series 1998-1
Supplement, dated as of the Series 1998-1 Closing Date, and the Base
Indenture, in each case duly executed by the Lessor and the Trustee,
and all conditions to the effectiveness thereof and the issuance of
the Notes thereunder shall have been satisfied or waived in all
respects;
(o) Series 1998-1 Letter of Credit. The Series 1998-1 Letter
of Credit, issued by Credit Suisse First Boston, with an initial
stated amount of $5,000,000; and
(p) Other. Such other documents as the Trustee or the Lessor
may reasonably request.
[Signatures on following pages.]
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<PAGE> 60
IN WITNESS WHEREOF, the parties have executed this Lease or caused it
to be executed by their respective officers thereunto duly authorized as of the
day and year first above written.
LESSOR:
RENTAL CAR FINANCE CORP.
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
Attention: Pamela S. Peck
Telephone: (918) 669-2550
Facsimile: (918) 669-2301
LESSEES AND SERVICERS:
THRIFTY RENT-A-CAR SYSTEM, INC.
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
Attention: Pamela S. Peck
Telephone: (918) 665-3930
Facsimile: (918) 669-2301
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<PAGE> 61
DOLLAR RENT A CAR SYSTEMS, INC.
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
Attention: Michael H. McMahon
Telephone: (918) 669-3000
Facsimile: (918) 669-2925
GUARANTOR
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
By:
---------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
Attention: Steven B. Hildebrand
Telephone: (918) 660-7700
Facsimile: (918) 669-2970
COUNTERPART NO. ___ OF TEN (10) SERIALLY NUMBERED MANUALLY EXECUTED
COUNTERPARTS. TO THE EXTENT IF ANY THAT THIS DOCUMENT CONSTITUTES CHATTEL
PAPER UNDER THE UNIFORM COMMERCIAL CODE, NO SECURITY INTEREST IN THIS DOCUMENT
MAY BE CREATED THROUGH THE TRANSFER AND POSSESSION OF ANY COUNTERPART OTHER
THAN MANUALLY EXECUTED COUNTERPART NO. 1.
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<PAGE> 62
The Trustee does hereby acknowledge, by its signature below, receipt
of this Counterpart No. 1.
TRUSTEE
BANKERS TRUST COMPANY
By:
---------------------------------
Name:
Title:
Address: 4 Albany Street, 10th Floor
New York, New York 10006
Attention: Corporate Trust and Agency
Group/Structured Finance
Telephone: (212) 250-6553
Facsimile: (212) 250-6439
Acknowledged by:
MASTER COLLATERAL AGENT
BANKERS TRUST COMPANY
By:
----------------------------
Name:
Title:
Address: 4 Albany Street, 10th Floor
New York, New York 10006
Attention: Corporate Trust and Agency
Group/Structured Finance
Telephone: (212) 250-6553
Facsimile: (212) 250-6439
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<PAGE> 63
ANNEX A
ANNEX
TO THE
MASTER MOTOR VEHICLE LEASE AND SERVICING AGREEMENT
Dated as of March 4, 1998
among
RENTAL CAR FINANCE CORP.
as Lessor,
THRIFTY RENT-A-CAR-SYSTEM, INC.,
as Lessee and Servicer,
DOLLAR RENT A CAR SYSTEMS, INC.,
as Lessee and Servicer,
and those Subsidiaries
of Dollar Thrifty Automotive Group, Inc.
from time to time
becoming Lessees and Servicers under such Master Motor
Vehicle Lease and Servicing Agreement
and
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
as Guarantor and Master Servicer
<PAGE> 64
1. Scope of Annex. This Annex A shall apply only to the acquisition,
leasing and servicing of the Acquired Vehicles by the Lessor pursuant to the
Base Lease, as supplemented by this Lease Annex (collectively, the "Operating
Lease").
2. General Agreement. With respect to the Acquired Vehicles, each
Lessee and the Lessor each intend that the Base Lease, as supplemented by this
Lease Annex, is an operating lease and that the relationship between the Lessor
and the Lessees pursuant thereto and hereto shall always be only that of lessor
and lessee, and each Lessee hereby declares, acknowledges and agrees that the
Lessor has title to and is the owner of the Acquired Vehicles. The Lessees
shall not acquire by virtue of the Lease any right, equity, title or interest
in or to any Acquired Vehicles, except the right to use the same under the
terms of the Operating Lease hereof. The parties agree that this Operating
Lease is a "true lease" for all legal, accounting, tax and other purposes and
agree to treat this Operating Lease, as it applies to the Acquired Vehicles, as
an operating lease for all purposes, including tax, accounting and otherwise.
The parties will file all federal, state and local tax returns and reports in a
manner consistent with the preceding sentence.
3. Operating Lease Commitment. (a) Upon the execution and delivery
of this Operating Lease, the Lessor shall, subject to the terms and conditions
of the Agreement, purchase from time to time on or after the Lease Commencement
Date and prior to the Lease Expiration Date, all Acquired Vehicles identified
in Vehicle Orders placed by a Lessee for a purchase price equal to the Initial
Acquisition Cost thereof, and simultaneously therewith, the Lessor shall under
the Operating Lease enter into operating leases with such Lessee with respect
to such Vehicles; provided, that the aggregate Net Book Value of Acquired
Vehicles leased hereunder on any date shall not exceed (a) the Maximum Lease
Commitment, less (b) the Base Amount as of such date with respect to the
Financing Lease.
4. Lease Procedures. In connection with the Lease of any Acquired
Vehicles to be leased on or after the Lease Commencement Date, to evidence the
acquisition of such Acquired Vehicles by the Lessor, the applicable Lessee
shall deliver to the Lessor the following:
(a) a Vehicle Order (including a Vehicle Acquisition
Schedule) with respect to all Acquired Vehicles to be leased by such
Lessee on the Lease Commencement Date;
(b) UCC termination statements terminating, or UCC partial
releases releasing, any security interests and other liens (other than
Permitted Liens) in favor of any Person with respect to each Acquired
Vehicle leased on the Lease Commencement Date and identified in such
Vehicle Order, and any related Vehicle Disposition Programs;
(c) with respect to the initial lease of Acquired Vehicles by
such Lessee, a fully executed Assignment Agreement covering each
Program Vehicle leased under this Annex A on the Lease Commencement
Date or to be leased under this Annex A on any date
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<PAGE> 65
thereafter, the related Vehicle Disposition Programs, and any other
Master Collateral relating to such Vehicles.
Each Lessee hereby agrees that each such delivery of a Vehicle Order
shall be deemed hereunder to constitute a representation and warranty by the
Lessee, to and in favor of the Lessor and the Trustee, that all the conditions
precedent to the acquisition and leasing of the Vehicles identified in such
Vehicle Order have been satisfied as of the date of such Vehicle Order.
5. Maximum Vehicle Lease Term. The maximum Vehicle lease term of the
Operating Lease as it relates to each Acquired Vehicle leased hereunder shall
be from the Vehicle Lease Commencement Date to the date that is 24 months from
the date of the original new vehicle dealer invoice for such Acquired Vehicle.
On the occurrence of such date for a Vehicle not previously disposed of, the
applicable Lessee shall, (a) on behalf of the Lessor, promptly dispose of such
Vehicle in accordance with the terms hereof and in accordance with any
instructions of the Lessor for such disposition, (b) in each case, provide that
Disposition Proceeds be paid directly to the Master Collateral Account for the
benefit of the Trustee and (c) pay to the Master Collateral Agent or the
Trustee, in accordance with this Operating Lease, any other amounts unpaid and
owing from such Lessee under the Lease in respect of such Vehicle.
6. Lessee's Rights to Purchase Vehicles. Each Lessee will have the
option, exercisable with respect to any Acquired Vehicle during the Vehicle
Term with respect to such Acquired Vehicle, to purchase any Vehicles leased by
it under the Lease at the Vehicle Purchase Price, in which event such Lessee
will pay the Vehicle Purchase Price to the Master Collateral Agent on or before
the Due Date next succeeding such purchase by the Lessee plus all accrued and
unpaid Monthly Base Rent and Monthly Variable Rent with respect to such Vehicle
through the date of such purchase. In addition, each Lessee will have the
option, exercisable with respect to any Manufacturer Receivable related to an
Acquired Vehicle which was leased by such Lessee under this Lease, to purchase
such Manufacturer Receivable for a price equal to the amount due from the
Manufacturer under such Manufacturer Receivable, in which event the Lessee will
pay such amount to the Master Collateral Agent on or before the Payment Date
next succeeding such purchase by the Lessee. Upon receipt of such funds by the
Master Collateral Agent, the Lessor, at the request of the Lessee, shall cause
title to any such Vehicle or Manufacturer Receivable, as applicable, to be
transferred to the applicable Lessee, and the lien of the Master Collateral
Agent on such Vehicle shall be released thereby.
7. Vehicle Disposition. The Lessor and each Lessee agree that, with
respect to Acquired Vehicles, the applicable Lessee shall use its commercially
reasonable efforts to deliver each Program Vehicle leased by it under the Lease
for sale in accordance with the applicable Auction Procedures or to return such
related Program Vehicle to the related Manufacturer (a) not prior to the end of
the Minimum Term for such Vehicle, and (b) not later than the end of the
Maximum Term for such Vehicle; provided, however, if for any reason, such
Lessee fails to deliver such a Program Vehicle to the applicable Manufacturer
for repurchase by the Manufacturer or in
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accordance with the applicable Auction Procedures, in each case in accordance
with the applicable Vehicle Disposition Program during the time period between
the expiration of the Minimum Term and the expiration of the Maximum Term, such
Lessee shall be obligated to sell or otherwise dispose of such Program Vehicle
and pay a Late Return Payment with respect thereto, in each case as provided in
Section 13 of the Base Lease. Each Lessee shall, with respect to Acquired
Vehicles leased by it under this Operating Lease, pay the equivalent of the
Rent for the Minimum Term for Program Vehicles returned before the Minimum
Term, regardless of actual usage, unless such a Program Vehicle is a Casualty,
which will be handled in accordance with Section 7 of the Base Lease. All
Disposition Proceeds, Repurchase Payments and Guaranteed Payments due from the
disposition of Program Vehicles pursuant to this Section shall be due and
payable to the Lessor. The Lessor and each Lessee agree, with respect to
Acquired Vehicles, that such Lessee shall use its commercially reasonable
efforts to dispose of each Non-Program Vehicle leased to it under this
Operating Lease (a) in a manner most likely to maximize proceeds from such
disposition and consistent with industry practice and (b) within twenty-four
(24) months after the date of the original new vehicle dealer invoice for such
Vehicle. All Disposition Proceeds due from the disposition of Non-Program
Vehicles pursuant to this Section shall be due and payable to the Lessor.
8. Lessor's Right to Cause Vehicles to be Sold. Notwithstanding
anything to the contrary contained in the Lease, the Lessor shall have the
right, at any time after the date thirty (30) days prior to the expiration of
the Maximum Term for any Program Vehicle leased under this Annex A, to require
that the Lessee in respect of such Program Vehicle deliver such Program Vehicle
to the Manufacturer for repurchase or, as applicable, to the designated auction
site, or exercise commercially reasonable efforts to arrange for the sale of
such Program Vehicle to a third party for a price greater than the Net Book
Value thereof, in which event the Lessee shall, prior to the expiration of such
Maximum Term, deliver such Vehicle to its Manufacturer or the designated
auction site or arrange for the sale of such Program Vehicle to a third party
for a price greater than the Net Book Value (or purchase the Program Vehicle
itself from the Lessor for the Vehicle Purchase Price). If a sale of the
Program Vehicle is arranged by a Lessee prior to the expiration of such Maximum
Term, then such Lessee shall deliver the Program Vehicle to the purchaser
thereof, the Lien of the Master Collateral Agent on the Certificate of Title of
such Program Vehicle shall be released, and such Lessee shall cause to be
delivered to the Lessor the funds paid for such Program Vehicle by the
purchaser. If a Lessee is unable to arrange for a sale of the Program Vehicle
prior to the expiration of such Maximum Term, then such Lessee shall cease
attempting to arrange for such a sale and shall return such Program Vehicle to
the applicable Manufacturer or tender such Program Vehicle in accordance with
applicable Auction Procedures or purchase such Vehicle as herein provided. In
no event may any Program Vehicle be sold pursuant to this paragraph 8 (other
than pursuant to a Vehicle Disposition Program) unless the funds to be paid to
the Lessor arising out of such sale exceed the Net Book Value of such Vehicle
less reasonably predictable Excess Mileage charges, Excess Damage Charges and
other similar charges imposed by the Manufacturer.
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9. Calculation of Rent. Rent shall be due and payable on a monthly
basis as set forth in this paragraph 9:
"Monthly Base Rent", with respect to each Due Date and each
Acquired Vehicle leased under the Lease on any day during the Related
Month, shall be the sum of all Depreciation Charges that have accrued
with respect to such Vehicle during the Related Month.
"Monthly Variable Rent", with respect to each Due Date and
each Acquired Vehicle leased under the Lease on any day during the
Related Month, shall equal the sum, without double counting, of (a)
the product of (i) an amount equal to the Net Book Value of such
Acquired Vehicle on the first day contained within both the Related
Month and the Vehicle Term with respect to such Vehicle multiplied by
the VFR for the Interest Period ending on the next succeeding Payment
Date and (ii) the quotient obtained by dividing (A) the number of days
contained within both the Related Month and the Vehicle Term with
respect to such Acquired Vehicle by (B) the total number of days in
the Related Month plus (b) the product of (i) an amount equal to all
Carrying Charges for the Related Month, and (ii) the quotient obtained
by dividing the Net Book Value of such Acquired Vehicle as of the
first day of the Related Month by the Net Book Value of all Vehicles
leased under the Lease as of the first day of the Related Month.
"VFR", for any Interest Period with respect to any Group II
Series of Notes, is an interest rate equal to the quotient, expressed
as a percentage, of (i) the amount of interest accrued during such
Interest Period with respect to all Group II Series of Notes divided
by (ii) the average daily Aggregate Principal Balance of all such
Group II Series of Notes during such period.
"Rent" means Monthly Base Rent plus Monthly Variable Rent.
10. Payment of Rent and Other Payments.
(a) Monthly Base Rent. On each Due Date, each Lessee shall
pay to the Lessor the Monthly Base Rents that have accrued during the
Related Month with respect to all Vehicles that were leased by such
Lessee under this Operating Lease on any day during the Related Month;
(b) Monthly Variable Rent. On each Due Date, each Lessee
shall pay to the Lessor the Monthly Variable Rents that have accrued
during the Related Month with respect to all Vehicles that were leased
by such Lessee under this Operating Lease on any day during the
Related Month;
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(c) Termination Payments, Casualty Payments and Late Return
Payments. On each Due Date, each Lessee shall pay to the Lessor all
Termination Payments, Casualty Payments and Late Return Payments with
respect to Vehicles leased by such Lessee under this Operating Lease
as provided in Section 5.4 of the Base Lease; and
(d) Certain Other Payments. Each Lessee shall cause all
Disposition Proceeds, Repurchase Payments, Guaranteed Payments and
Incentive Payments payable in respect of Acquired Vehicles leased by
it under this Operating Lease, to be paid directly to the Master
Collateral Agent for the benefit of the Trustee. The Servicer and the
Lessees each agree that in the event that the Servicer or a Lessee
shall receive directly any such payment, including cash, securities,
obligations or other property, the Servicer or such Lessee, as the
case may be, shall accept the same as the Master Collateral Agent's
agent and shall hold the same in trust on behalf of and for the
benefit of the Master Collateral Agent, and shall deposit the same,
within two (2) Business Days after receipt thereof, into the Master
Collateral Account in the same form received, with the endorsement of
the Servicer or such Lessee, as the case may be, when necessary or
appropriate.
11. Net Lease. THE OPERATING LEASE SHALL BE A NET LEASE, AND EACH
LESSEE'S OBLIGATION TO PAY ALL RENT AND OTHER SUMS HEREUNDER SHALL BE ABSOLUTE
AND UNCONDITIONAL, AND SHALL NOT BE SUBJECT TO ANY ABATEMENT OR REDUCTION FOR
ANY REASON WHATSOEVER. The obligations and liabilities of the Lessees
hereunder shall in no way be released, discharged or otherwise affected (except
as may be expressly provided herein including, without limitation, the right of
a Lessee to reject Vehicles pursuant to Section 2.2 of the Base Lease) for any
reason, including without limitation: (i) any defect in the condition,
merchantability, quality or fitness for use of the Vehicles or any part
thereof; (ii) any damage to, removal, abandonment, salvage, loss, scrapping or
destruction of or any requisition or taking of the Vehicles or any part
thereof; (iii) any restriction, prevention or curtailment of or interference
with any use of the Vehicles or any part thereof; (iv) any defect in or any
Lien on title to the Vehicles or any part thereof; (v) any change, waiver,
extension, indulgence or other action or omission in respect of any obligation
or liability of a Lessee or the Lessor; (vi) any bankruptcy, insolvency,
reorganization, composition, adjustment, dissolution, liquidation or other like
proceeding relating to such Lessee, the Lessor or any other Person, or any
action taken with respect to this Operating Lease by any trustee or receiver of
any Person mentioned above, or by any court; (vii) any claim that such Lessee
has or might have against any Person, including without limitation the Lessor;
(viii) any failure on the part of the Lessor to perform or comply with any of
the terms hereof or of any other agreement; (ix) any invalidity or
unenforceability or disaffirmance of this Operating Lease or any provision
hereof or any of the other Related Documents or any provision of any thereof,
in each case whether against or by such Lessee or otherwise; (x) any insurance
premiums payable by such Lessee with respect to the Vehicles; or (xi) any other
occurrence whatsoever, whether similar or dissimilar to the foregoing, whether
or not such Lessee shall have notice or knowledge of any of the foregoing and
whether or not foreseen or foreseeable. This Operating Lease shall be
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noncancelable by any Lessee and, except as expressly provided herein, each
Lessee, to the extent permitted by law, waives all rights now or hereafter
conferred by statute or otherwise to quit, terminate or surrender this
Operating Lease, or to any diminution or reduction of Rent payable by the
Lessee hereunder. All payments by a Lessee made hereunder shall be final
(except to the extent of adjustments provided for herein), absent manifest
error and, except as otherwise provided herein, no Lessee shall seek to recover
any such payment or any part thereof for any reason whatsoever, absent manifest
error. If for any reason whatsoever this Operating Lease shall be terminated
in whole or in part by operation of law or otherwise except as expressly
provided herein, each Lessee shall nonetheless pay an amount equal to each Rent
payment at the time and in the manner that such payment would have become due
and payable under the terms of this Operating Lease as if it had not been
terminated in whole or in part. All covenants and agreements of the Lessees
herein shall be performed at its cost, expense and risk unless expressly
otherwise stated.
12. Liens. Except for Permitted Liens, each Lessee shall keep all
Acquired Vehicles leased by it free of all Liens arising during the Term. Upon
the Vehicle Lease Expiration Date for each Acquired Vehicle leased hereunder,
the Lessor may, in its discretion, remove any such Lien and any sum of money
that may be paid by the Lessor in release or discharge thereof, including
reasonable attorneys' fees and costs, will be paid by the applicable Lessee
upon demand by the Lessor. The Lessor may grant security interests in the
Acquired Vehicles without consent of the applicable Lessee; provided, however,
that if any such Liens would interfere with the rights of such Lessee under
this Operating Lease or any sublessee of such Lessee, the Lessor must obtain
the prior written consent of such Lessee. Each Lessee acknowledges that the
granting of Liens and the taking of other actions pursuant to the Indenture and
the Related Documents does not interfere with the rights of such Lessee under
this Operating Lease.
13. Non-Disturbance. So long as a Lessee satisfies its obligations
hereunder, its quiet enjoyment, possession and use of the Acquired Vehicles
will not be disturbed during the Term subject, however, to paragraph 8 of this
Annex A and except that the Lessor, the Master Collateral Agent and the Trustee
each retains the right, but not the duty, to inspect the Acquired Vehicles
without disturbing the ordinary conduct of such Lessee's business and except as
may be required as a consequence of a Liquidation Event of Default or Series
1998-1 Limited Liquidation Event of Default or certain optional prepayments of
a Series of Notes. Upon the request of the Lessor, the Master Collateral Agent
or the Trustee, from time to time, each Lessee will make reasonable efforts to
confirm to the Lessor, the Master Collateral Agent and the Trustee the
location, mileage and condition of each Acquired Vehicle and to make available
for the Lessor's, the Master Collateral Agent's or the Trustee's inspection
within a reasonable time period, not to exceed forty-five (45) days, the
Acquired Vehicles leased by such Lessee at the location where the Acquired
Vehicles are normally located. Further, each Lessee (and each related
Franchisee) will, during normal business hours and with a notice of three (3)
Business Days, make its records pertaining to such Acquired Vehicles available
to the Lessor, the Master
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Collateral Agent or the Trustee for inspection at the location where such
Lessee's (and each such related Franchisee's) records are normally domiciled.
14. Certain Risks of Loss Borne by Lessees. Upon delivery of each
Vehicle to a Lessee, as between the Lessor and such Lessee, such Lessee assumes
and bears the risk of loss, damage, theft, taking, destruction, attachment,
seizure, confiscation or requisition and all other risks and liabilities with
respect to such Vehicle, including personal injury or death and property
damage, arising with respect to any Vehicle due to the manufacturer, purchase,
acceptance, rejection, delivery, leasing, subleasing, possession, use,
inspection, registration, operation, condition, maintenance, repair or storage
of such Vehicle, howsoever arising.
15. Title. This is an agreement to lease only, and title to the
Acquired Vehicles will at all times remain in the Lessor's name. The Lessees
will not have any rights or interest in such Vehicles whatsoever other than the
rights of possession and use and the right to sublease such Vehicles as
provided by the Lease. In addition, each Lessee, by its execution hereof,
acknowledges and agrees that (i) the Lessor is the sole owner and holder of all
right, title and interest in and to the Vehicle Disposition Programs as they
relate to the Vehicles leased hereunder and (ii) such Lessee has no right,
title or interest in any Vehicle Disposition Program as it relates to any
Vehicle leased hereunder. To confirm the foregoing, each Lessee, by its
execution of the Base Lease of which this Annex A is a part, hereby assigns and
transfers to the Lessor any rights that such Lessee may have in respect of any
Vehicle Disposition Programs as they relate to the Vehicles leased hereunder.
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ANNEX B
ANNEX
TO THE
MASTER MOTOR VEHICLE LEASE AND SERVICING AGREEMENT
Dated as of March 4, 1998
between
RENTAL CAR FINANCE CORP.
as Lessor,
THRIFTY RENT-A-CAR-SYSTEM, INC.,
as Lessee and Servicer,
DOLLAR RENT A CAR SYSTEMS, INC.,
as Lessee and Servicer,
and those Subsidiaries
of Dollar Thrifty Automotive Group, Inc.
from time to time
becoming Lessees and Servicers under such
Master Motor Vehicle Lease and
Servicing Agreement
and
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
as Guarantor and Master Servicer
<PAGE> 72
1. Scope of Annex. This Annex B shall apply only to the acquisition
or financing, leasing and servicing of the Financed Vehicles by RCFC pursuant
to the Base Lease, as supplemented by this Lease Annex (collectively, the
"Financing Lease").
2. General Agreement. With respect to the Financed Vehicles, each
Lessee and the Lessor each intend that the Base Lease, as supplemented by this
Lease Annex, constitute a financing arrangement and the Lessor hereby declares,
acknowledges and agrees that the ownership of the Financed Vehicles rests
solely with such Lessee subject to the security interest granted hereunder to
the Lessor.
3. Financing Lease Commitment. Subject to the terms and conditions
of this Financing Lease, upon execution and delivery of this Financing Lease,
the Lessor shall (i) on or after the Lease Commencement Date purchase, finance
or refinance Vehicles in the Existing Fleet and other Refinanced Vehicles
identified in Refinancing Schedules for a purchase price equal to the aggregate
Net Book Value thereof, and (ii) from time to time on or after the Lease
Commencement Date and prior to the Lease Expiration Date finance all Financed
Vehicles identified in Vehicle Orders placed by a Lessee for an amount equal to
the Initial Acquisition Cost thereof, and in each case simultaneously therewith
enter into this Financing Lease with such Lessee with respect to the Existing
Fleet and other Financed Vehicles, as the case may be; provided, that the
aggregate outstanding Base Amount of the Financing Lease shall not on any date
exceed (a) the Maximum Lease Commitment, less (b) the sum of (x) the sum of the
Net Book Values of Acquired Vehicles leased under the Operating Lease on such
date, each such Net Book Value calculated as of the first day contained within
both the calendar month in which such date of determination occurs and the
Vehicle Term for the related Acquired Vehicle, plus (y) accrued and unpaid
Monthly Base Rent under the Operating Lease as of such date.
4. Lease Procedures.
(a) Initial Lease. In connection with the lease of any
Financed Vehicles to be leased on the Lease Commencement Date (or, in
the case of an Additional Lessee, the date of the initial Vehicle
Order or Refinancing Schedule thereof), to evidence the refinancing of
Vehicles in the Existing Fleet and any other Refinanced Vehicles and
the acquisition and financing of any other Financed Vehicles by each
Lessee on the Lease Commencement Date (or the date of such initial
Vehicle Order) and the conveyance on such date of a security interest
in such Financed Vehicles to the Master Collateral Agent, such Lessee
shall deliver to the Lessor on or prior to the Lease Commencement Date
(or the date of such initial Vehicle Order or Refinancing Schedule)
the following:
(i) a Refinancing Schedule concerning any Vehicles in
the Existing Fleet and any other Refinanced Vehicles
refinanced on such date, or a Vehicle Order (including a
Vehicle Acquisition Schedule) with respect to all other
Financed
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Vehicles to be leased by such Lessee on the Lease Commencement
Date (or date of the initial Vehicle Order of such Additional
Lessee, as applicable);
(ii) a report of the results of a search of the
appropriate records of the county and state in which the
Refinanced Vehicles are located and the county and state in
which such Lessee's principal office is located, which shall
show no liens or other security interests (other than
Permitted Liens and the lien of Chrysler Financial Corporation
in the Existing Fleet) with respect to such Vehicles or, in
the event that such search reveals any such non-permitted Lien
or security interest, there shall be delivered to the Trustee
a termination of such Lien or security interest as provided
below;
(iii) confirmation from any lender holding a security
interest in any Refinanced Vehicle stating unconditionally (A)
that, if any sums are to be paid to such lender in connection
with the lease of the Refinanced Vehicle, such lender has been
paid the full amount due to it in connection with such
refinancing and (B) that any lien or security interest of such
lender in such Vehicle has been released;
(iv) UCC termination statements terminating, or UCC
partial releases releasing, any security interests and other
liens (other than Permitted Liens and the lien of Chrysler
Financial Corporation in the Existing Fleet) in favor of any
Person with respect to each Vehicle in the Existing Fleet
identified in such schedule and any related Vehicle
Disposition Programs;
(v) fully executed Assignment Agreements from such
Lessee covering, as applicable, each Vehicle in the Existing
Fleet and each other Financed Vehicle leased by such Lessee on
the Lease Commencement Date or leased on any date thereafter
under the Lease, the related Vehicle Disposition Programs, and
any other Master Collateral relating to such Vehicles; and
(vi) an Officer's Certificate for such Lessee stating
that all the conditions precedent under the Lease to the
leasing by such Lessee of such Vehicles on the Lease
Commencement Date have been satisfied.
(b) Subsequent Leases. In connection with each Lease of a
Financed Vehicle after the Lease Commencement Date, to evidence the
acquisition, financing or refinancing of such Financed Vehicle by the
Lessor and the conveyance of a security interest in such Financed
Vehicles to the Master Collateral Agent, each Lessee shall deliver to
the Lessor a Vehicle Order (including a Vehicle Acquisition Schedule)
or Refinancing Schedule with respect to all Financed Vehicles to be
leased by such Lessee on the date specified therein. Each Lessee
hereby agrees that each such delivery of a
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Vehicle Order or Refinancing Schedule, as applicable, shall be deemed
hereunder to constitute a representation and warranty by such Lessee,
to and in favor of the Lessor and the Trustee, that all the conditions
precedent to the acquisition or financing or refinancing and leasing
of the Vehicles identified in such Vehicle Order or Refinancing
Schedule, as applicable, have been satisfied as of the date of such
Vehicle Order or Refinancing Schedule.
5. Maximum Vehicle Lease Term. The maximum Vehicle lease term of
this Financing Lease as it relates to each Financed Vehicle leased hereunder
shall be from the Vehicle Lease Commencement Date to the date that is 60 months
from the Vehicle Lease Commencement Date. On the occurrence of such date, the
applicable Lessee shall pay to the Master Collateral Agent or the Trustee, in
accordance with this Financing Lease, any amounts unpaid and owing under the
Lease in respect of such Vehicle.
6. Calculation of Rent and Monthly Supplemental Payment. Rent and
the Monthly Supplemental Payment shall be due and payable on a monthly basis as
set forth in this paragraph 6:
"Monthly Base Rent", with respect to each Due Date and each
Financed Vehicle leased under the Lease on any day during the Related
Month, shall be the sum of all Depreciation Charges that have accrued
with respect to such Vehicle during the Related Month.
"Monthly Finance Rent", with respect to each Due Date and each
Financed Vehicle leased under the Lease on any day during the Related
Month, shall equal the sum, without double counting, of (a) the
product of (i) an amount equal to the Net Book Value of such Financed
Vehicle on the first day contained within both the Related Month and
the Vehicle Term with respect to such Vehicle multiplied by the VFR
for the Interest Period ending on the next succeeding Payment date and
(ii) the quotient obtained by dividing (A) the number of days
contained within both the Related Month and the Vehicle Term with
respect to such Financed Vehicle by (B) the total number of days in
the Related Month, plus (b) the product of (i) an amount equal to all
Carrying Charges for the Related Month, and (ii) the quotient obtained
by dividing the Net Book Value of such Financed Vehicle as of the
first day of the Related Month by the Net Book Value of all Vehicles
leased under the Lease as of the first day of the Related Month.
"Monthly Supplemental Payment" with respect to each Due Date
and each Financed Vehicle shall be an amount equal to (a) the sum of,
as applicable, (i) the aggregate amount of any Guaranteed Payment,
Repurchase Payment, Disposition Proceeds and Incentive Payments
received by the Lessor, the Master Collateral Agent or the Trustee
(including by deposit into the Collection Account or the Master
Collateral Account) during the Related Month with respect to such
Vehicle, (ii) the amount of any
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unpaid Guaranteed Payment or unpaid Repurchase Payment with respect to
such Vehicle becoming a Delinquent Guaranteed Payment or Delinquent
Repurchase Payment, as the case may be, during the Related Month,
(iii) the amount of any Disposition Proceeds with respect to such
Vehicle becoming Delinquent Disposition Proceeds during the Related
Month, (iv) the amount of any unpaid Incentive Payments with respect
to such Vehicle becoming Delinquent Incentive Payments during the
Related Month, (v) if such Vehicle becomes a Casualty or ceases to be
an Eligible Vehicle (other than as a result of the sale or other
disposition thereof), in each case during the Related Month, the Net
Book Value of such Vehicle calculated as of the earlier of the last
day of such Related Month and the date such Vehicle is disposed of or
becomes a Casualty, as applicable, and (vi) if such Vehicle was
returned to its Manufacturer for repurchase or sold to any Person or
otherwise disposed of, in each case during the Related Month, the
excess, if any, of (A) the Net Book Value of such Vehicle, calculated
as of the applicable Vehicle Lease Expiration Date, over (B) the sum
of all amounts (other than Incentive Payments) payable in respect of
such Vehicle pursuant to clause (i) above, less (b) the excess, if
any, of (i) the aggregate amount of Disposition Proceeds, Guaranteed
Payments or Repurchase Payments, as applicable, from the sale or other
disposition of such Vehicle received by the Lessor, the Master
Collateral Agent or the Trustee (including by deposit into the
Collection Account or the Master Collateral Account) during such
Related Month over (ii) the Net Book Value of such Vehicle, calculated
as of the applicable Vehicle Lease Expiration Date.
"Rent" means Monthly Base Rent plus Monthly Finance Rent.
"VFR", for any Interest Period with respect to any Group II
Series of Notes, is an interest rate equal to the quotient, expressed
as a percentage, of (i) the amount of interest accrued during such
Interest Period with respect to all Group II Series of Notes, divided
by (ii) the average daily Aggregate Principal Balance of all such
Group II Series of Notes during such period.
7. Payment of Rent and Other Payments. (a) On each Due Date:
(i) Monthly Base Rent. Each Lessee shall pay to the Lessor
the Monthly Base Rents that have accrued during the Related Month with
respect to all Vehicles that were leased by such Lessee under this
Finance Lease on any day during the Related Month; provided, however,
that in the event that delinquent payments of Guaranteed Payments,
Repurchase Payments, Disposition Proceeds and/or Incentive Payments
are received by the Lessor, the Master Collateral Agent or the Trustee
(including by deposit into the Collection Account or the Master
Collateral Account) during the Related Month, such payments may be
netted against the Monthly Base Rents to be paid on such Due Date to
the extent (but only to the extent) that Monthly Base Rent has already
been received by any of such Persons in respect of such delinquent
payment obligations pursuant to any or
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all of clauses (a)(ii), (iii) and (iv) of the definition of Monthly
Supplemental Payment set forth in this Annex B;
(ii) Monthly Finance Rent. Each Lessee shall pay to the
Lessor the Monthly Finance Rents that have accrued during the Related
Month with respect to all Vehicles that were leased by such Lessee
under this Finance Lease on any day during the Related Month.
(iii) Monthly Supplemental Payments. Each Lessee shall pay
to the Lessor the Monthly Supplemental Payments that have accrued
during the Related Month with respect to all Vehicles that were leased
by such Lessee under this Finance Lease on any day during the Related
Month; provided, however, that in the event that the Monthly
Supplemental Payment accrued during a Related Month is a negative
dollar amount, such amount may be netted against other payments to be
paid on such Due Date pursuant to this paragraph 7.
(b) On the expiration of the term of the Lease with respect to a
Financed Vehicle, any remaining Base Amount, plus all other amounts payable by
each Lessee under this Financing Lease with respect to such Vehicle shall be
immediately due and payable.
(c) Each Lessee may from time to time prepay the Base Amount of the
Financing Lease with respect to a Financed Vehicle, in whole or in part, on any
date, provided that such Lessee shall give the Lessor and the Trustee not less
than one (1) Business Day's prior notice of any prepayment, specifying the date
and amount of such prepayment, and the Financed Vehicles to which such
prepayment relates.
8. Risk of Loss Borne by Lessees. Upon delivery of each Vehicle to a
Lessee, as between the Lessor and such Lessee, such Lessee assumes and bears
the risk of loss, damage, theft, taking, destruction, attachment, seizure,
confiscation or requisition with respect to such Vehicle, however caused or
occasioned, and all other risks and liabilities, including personal injury or
death and property damage, arising with respect to any Vehicle or the
manufacture, purchase, acceptance, rejection, ownership, delivery, leasing,
subleasing, possession, use, inspection, registration, operation, condition,
maintenance, repair, storage, sale, return or other disposition of such
Vehicle, howsoever arising.
9. Mandatory Purchase of Texas Vehicles. Prior to the Vehicle Lease
Expiration Date with respect to each Texas Vehicle leased by a Lessee under
this Finance Lease (other than a Vehicle Lease Expiration Date arising in
connection with the purchase of such Texas Vehicle pursuant to this paragraph
9) and, in the case of each such Texas Vehicle which is a Program Vehicle,
prior to the expiration of the Maximum Term applicable thereto (unless such
Vehicle has been redesignated as a Non-Program Vehicle in accordance with
Section 14 of the Base Lease), such Lessee shall purchase such Texas Vehicle,
(including any such Vehicle which has
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become a Casualty) at a purchase price equal to the Net Book Value of such
Vehicle calculated as of the date of purchase (or, in the case of a Casualty,
at a purchase price equal to the Monthly Supplemental Payments accruing in
respect of such Casualty during the Related Month in which such Vehicle became
a Casualty), which shall be payable to the Master Collateral Agent (together
with all accrued and unpaid Rent and other payments due and payable on such Due
Date with respect to such Texas Vehicle through the date of such purchase) on
or prior to the Due Date next succeeding such purchase by such Lessee. The
Lessor shall cause title to each Texas Vehicle to be transferred to the
applicable Lessee, and the Servicer shall cause the Master Collateral Agent to
cause its Lien to be removed from the Certificate of Title for such Vehicle,
concurrently with or promptly after such purchase price for such Texas Vehicle
(and any such unpaid Rent and payments) is paid by such Lessee to the Master
Collateral Agent. Notwithstanding anything to the contrary in the Lease, no
Texas Vehicle may be sold or otherwise disposed of (other than pursuant to
Section 17.3 of the Base Lease), including at Auction or by return to its
Manufacturer pursuant to a Vehicle Disposition Program, prior to its purchase
by a Lessee pursuant to and in accordance with this paragraph 9.
10. Lessee's Rights to Purchase Manufacturer Receivables. In
addition, each Lessee will have the option, exercisable with respect to any
Manufacturer Receivable related to a Financed Vehicle which was leased by such
Lessee under this Lease, to purchase such Manufacturer Receivable for a price
equal to the amount due from the Manufacturer under such Manufacturer
Receivable, in which event the Lessee will pay such amount to the Master
Collateral Agent on or before the Payment Date next succeeding such purchase by
the Lessee. Upon receipt of such funds by the Master Collateral Agent, the
Lessor, at the request of the Lessee, shall cause title to any such
Manufacturer Receivable to be transferred to the Lessee, the lien of the Master
Collateral Agent in such Manufacturer Receivable will automatically be released
concurrently with or promptly after the purchase price for such Manufacturer
Receivable (and any unpaid Monthly Base Rent, unpaid Monthly Variable Rent and
other unpaid charges, payments and amounts) is paid by the Lessee to the Master
Collateral Agent or the Trustee.
-7-
<PAGE> 78
SCHEDULE 1
Litigation Claims
1. Dollar Thrifty Automotive Group, Inc. - None
2. Dollar Rent A Car Systems, Inc. - See Attached Schedule 1-A
3. Thrifty Rent -A- Car System, Inc. - See Attached Schedule 1-B
<PAGE> 79
SCHEDULE 2
[Reserved]
<PAGE> 80
SCHEDULE 3
Business Locations
<TABLE>
<CAPTION>
==================================================================================================================================
STATES IN WHICH IT
CHIEF EXECUTIVE OFFICE STATE OF PRINCIPAL CONDUCTS BUSINESS OR
LEGAL NAME AND TRADE NAME BUSINESS LOCATION PLACE OF BUSINESS MAINTAINS RECORDS
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
THRIFTY: 5330 East 31st Street Oklahoma Each of the 50 States from
Tulsa, OK 74135 time to time
Legal Name:
Thrifty Rent-A-Car System, Inc.
Trade Names:
Thrifty Rent-A-Car
Thrifty Car Rental
Thrifty (also used w/ subtitles, i.e.;
car rental, truck rental, parking,
airport parking, used car sales and
leasing)
Montgomery Ward Car Rental
- ----------------------------------------------------------------------------------------------------------------------------------
DOLLAR: 5330 East 31st Street Oklahoma Each of the 50 States from
Tulsa, OK 74135 time to time
Legal Name:
Dollar Rent A Car Systems, Inc.
Trade Names:
Dollar
Dollar Rent A Car
- ----------------------------------------------------------------------------------------------------------------------------------
DTAG: 5330 East 31st Street Oklahoma Each of the 50 States
Tulsa, OK 74135 from time to time
Legal Name:
Dollar Thrifty Automotive Group, Inc.
Trade Name:
None
==================================================================================================================================
</TABLE>
<PAGE> 81
SCHEDULE 4
Liens
NONE
<PAGE> 82
ATTACHMENT A-1
Information on Refinanced Vehicles and Eligible Receivables
Refinanced Vehicles
1 Vehicle Group Number (Vehicle Model)
2 Vehicle Identification Number (last eight digits) (VIN)
3 Vehicle Lease Commencement Date
4 Capitalized Cost
5 Monthly Base Rent
6 Garaging State
7 Designated Period
8 Lienholder
9 Amount to pay off existing indebtedness
Eligible Receivables
1 identity of obligor
2 amount of receivable
3 date of origination of receivable
4 vehicle identification number (VIN) of vehicles to which receivable
relates (grouped by obligor)
<PAGE> 83
ATTACHMENT A-2
Vehicle Acquisition Schedule
The attached "Vehicle Acquisition Schedule" is a sample listing of
vehicles to be financed on the A/P Due Date (the date payment is made to the
Dealer).
<PAGE> 84
ATTACHMENT B
FORM OF POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that Rental Car Finance Corp.,
an Oklahoma corporation, does hereby make, constitute and appoint
_______________________________ its true and lawful Attorney(s)-in-Fact for it
and in its name, stead and behalf, to execute any and all documents pertaining
to the titling of motor vehicles in the name of Rental Car Finance Corp., the
noting of the lien of Bankers Trust Company, a New York banking corporation, as
Master Collateral Agent, as the first lienholder on certificates of title, the
licensing and registration of motor vehicles and the transfer of title of motor
vehicles. This power is limited to the foregoing and specifically does not
authorize the creation of any other liens or encumbrances on any of said motor
vehicles, other than Permitted Liens (as defined in Schedule 1 to the Base
Indenture, dated as of December 13, 1995, between Rental Car Finance Corp., as
Issuer, and Bankers Trust Company, as Trustee, as amended by Amendment to Base
Indenture, dated as of December 23, 1997 (as amended by such amendment and as
such agreement may be further amended, supplemented or modified from time to
time in accordance with its terms)).
The powers and authority granted hereunder shall, unless
sooner terminated, revoked or extended, cease five years from the date of
execution as set forth below.
IN WITNESS WHEREOF, Rental Car Finance Corp. has caused this
instrument to be executed on its behalf by its _____________ this ____ day of
_______, 19__.
RENTAL CAR FINANCE CORP.
By:
------------------------------------
Name:
Title:
State of ___________________ )
:ss.:
County of __________________ )
Subscribed and sworn before me, a notary public, in and for said
county and state, this ____ day of ____________, 19__.
---------------------------------
Notary Public
My Commission Expires: __________
<PAGE> 85
ATTACHMENT C
FORM OF CERTIFICATION OF TRADE OR BUSINESS USE
The undersigned, ___________ of Rental Car Finance Corp., an Oklahoma
corporation, hereby warrants and certifies, under penalties of perjury, that
(1) each Lessee intends to use the Acquired Vehicles in a trade or business of
each Lessee, and (2) each Lessee has been advised that it will not be treated
as the owner of the Acquired Vehicles for federal income tax purposes.
Defined terms otherwise not defined herein shall have the meanings
assigned to such terms in Schedule 1 to the Base Indenture, dated as of
December 13, 1995, between Rental Car Finance Corp., as Issuer, and Bankers
Trust Company, a New York banking corporation, as Trustee, as amended by
Amendment to Base Indenture, dated as of December 23, 1997 (as amended by such
amendment and as such agreement may be further amended, supplemented or
modified from time to time in accordance with its terms).
IN WITNESS WHEREOF, the undersigned has caused this certificate to be
executed this ____ day of _________, 199__.
RENTAL CAR FINANCE CORP.
By:
------------------------------------
Name:
Title:
<PAGE> 86
ATTACHMENT D
FORM OF AFFILIATE JOINDER IN LEASE
THIS AFFILIATE JOINDER IN LEASE AGREEMENT (this "Joinder") is executed
as of _______________ ___, 19___, by _______________, a
____________________________ ("Joining Party"), and delivered to Rental Car
Finance Corp., an Oklahoma corporation ("RCFC"), as lessor pursuant to the
Master Motor Vehicle Lease and Servicing Agreement, dated as of March 4, 1998
(as amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Lease"), among RCFC, as Lessor, Thrifty
Rent-A-Car-System, Inc., an Oklahoma corporation as Lessee and Servicer, Dollar
Rent A Car Systems, Inc., an Oklahoma corporation as Lessee and Servicer, and
those Subsidiaries of Dollar Thrifty Automotive Group, Inc., a Delaware
corporation ("DTAG"), from time to time becoming Lessees thereunder
(individually, a "Lessee" and, collectively, the "Lessees"), and DTAG, as
Guarantor. Capitalized terms used herein but not defined herein shall have the
meanings provided for in the Lease.
R E C I T A L S:
WHEREAS, the Joining Party is a direct or indirect Subsidiary of DTAG;
and
WHEREAS, the Joining Party desires to become a "Lessee" under and
pursuant to the Group II Lease.
NOW, THEREFORE, the Joining Party agrees as follows:
A G R E E M E N T:
1. The Joining Party hereby represents and warrants to and in favor
of RCFC and the Trustee that (i) the Joining Party is a direct or indirect
Subsidiary of DTAG, (ii) all of the conditions required to be satisfied
pursuant to Section 28 of the Lease in respect of the Joining Party becoming a
Lessee thereunder have been satisfied, and (iii) all of the representations and
warranties contained in Section 23 of the Lease with respect to the Lessees are
true and correct as applied to the Joining Party as of the date hereof.
2. The Joining Party hereby agrees to assume all of the obligations
of a "Lessee" under the Lease and agrees to be bound by all of the terms,
covenants and conditions therein.
<PAGE> 87
3. By its execution and delivery of this Joinder, the Joining Party
hereby becomes a Lessee for all purposes under the Lease. By its execution and
delivery of this Joinder, RCFC acknowledges that the Joining Party is a Lessee
for all purposes under the Lease.
IN WITNESS WHEREOF, the Joining Party has caused this Joinder to be
duly executed as of the day and year first above written.
[Name of Joining Party]
By:
-------------------------------
Name:
Title:
Accepted and Acknowledged by:
RENTAL CAR FINANCE CORP.
By:
-------------------------------
Name:
Title:
-2-
<PAGE> 88
ATTACHMENT E
Form of Annual Certificate
<PAGE> 1
EXHIBIT 4.14
[EXECUTION COPY]
================================================================================
NOTE PURCHASE AGREEMENT
(VARIABLE FUNDING RENTAL CAR ASSET BACKED NOTES, SERIES 1998-1),
dated as of March 4, 1998,
among
RENTAL CAR FINANCE CORP.,
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.,
as Master Servicer,
and
DOLLAR THRIFTY FUNDING CORP.,
as Note Purchaser
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE II
PURCHASE AND SALE OF THE NOTES
SECTION 2.01 Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 2.02 Borrowing Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 2.03 Decreases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.04 CP Stop Issuance Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE III
INTEREST AND FEES
SECTION 3.01 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 3.02 [Reserved]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3.03 Certain Eurocurrency Rate and Other Provisions under the Liquidity Agreement and Credit
Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3.04 Carrying Charges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE IV
OTHER PAYMENT TERMS
SECTION 4.01 Time and Method of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE V
REPRESENTATIONS AND WARRANTIES
SECTION 5.01 RCFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 5.02 Master Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 5.03 Note Purchaser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
</TABLE>
-i-
<PAGE> 3
TABLE OF CONTENTS
(continued)
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE VI
CONDITIONS
SECTION 6.01 Conditions to Issuance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 6.02 Conditions to Initial Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 6.03 Conditions to Each Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
ARTICLE VII
COVENANTS
SECTION 7.01 Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE VIII
MISCELLANEOUS PROVISIONS
SECTION 8.01 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 8.02 No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 8.03 Binding on Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 8.04 Survival of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 8.05 Payment of Costs and Expenses; Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 8.06 Characterization as Related Document; Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 8.07 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 8.08 Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 8.09 Tax Characterization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 8.10 No Proceedings; Limited Recourse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 8.11 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 8.12 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 8.13 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
</TABLE>
EXHIBITS
EXHIBIT A Form of Advance Request
-ii-
<PAGE> 4
NOTE PURCHASE AGREEMENT
THIS NOTE PURCHASE AGREEMENT, dated as of March 4, 1998 (as amended,
supplemented, restated or otherwise modified from time to time in accordance
with the terms hereof, this "Agreement"), is made among RENTAL CAR FINANCE
CORP., an Oklahoma corporation ("RCFC"), DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.,
a Delaware corporation ("DTAG" or the "Master Servicer"), and DOLLAR THRIFTY
FUNDING CORP., an Oklahoma corporation ("DTFC" or the "Note Purchaser").
BACKGROUND
1. Contemporaneously with the execution and delivery of this
Agreement, RCFC is entering into (a) the Series 1998-1 Supplement, dated as of
even date herewith (as the same may be amended, supplemented, restated or
otherwise modified from time to time in accordance with the terms thereof, the
"Series 1998-1 Supplement"), between RCFC, as Issuer, and Bankers Trust
Company, a New York banking corporation, as the Trustee (in such capacity,
together with its successors in trust in such capacity, the "Trustee"), and as
the Enhancement Agent (in such capacity, the "Enhancement Agent"), to the Base
Indenture, dated as of December 13, 1995 (as amended by the Amendment to Base
Indenture, dated as of December 23, 1997, and as the same may be further
amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Base Indenture"), between RCFC and the Trustee,
and (b) the Master Motor Vehicle Lease and Servicing Agreement, dated as of
even date herewith (as the same may be amended, supplemented, restated or
otherwise modified from time to time in accordance with the terms thereof, the
"Master Lease") among RCFC, as lessor, the parties identified therein as the
Lessees and Servicers, those additional Subsidiaries of DTAG, from time to time
becoming Lessees and Servicers thereunder, and DTAG, as Guarantor and Master
Servicer, and (c) the other Related Documents (such term, as with the other
capitalized terms used herein, shall have the meaning assigned thereto in
Section 1.01 hereof) and CP Program Documents to which RCFC is a party.
Pursuant to the Base Indenture and the Series 1998-1 Supplement, RCFC will
issue the Rental Car Asset Backed Variable Funding Notes, Series 1998-1 (the
"Series 1998-1 Notes").
2. RCFC wishes to issue the Series 1998-1 Notes in favor of
the Note Purchaser and obtain the agreement of the Note Purchaser to make loans
from time to time (each, an "Advance") for the purchase of Series 1998-1
Invested Amounts, all of which Advances (including the Initial Advance) will
constitute Increases, and all of which Advances (including the Initial Advance)
will be evidenced by the Series 1998-1 Notes purchased in connection herewith
and will constitute purchases of Series 1998-1 Invested Amounts corresponding
to the amount of such Advances. Subject to the terms and conditions of this
Agreement, the Note Purchaser is willing to make Advances from time to time to
fund
<PAGE> 5
purchases of Series 1998-1 Invested Amounts in an aggregate outstanding amount
up to the amount set forth below its name on the signature pages to this
Agreement until the commencement of the Series 1998-1 Rapid Amortization
Period. DTAG has joined in this Agreement to confirm certain representations,
warranties and covenants made by it as Master Servicer for the benefit of the
Note Purchaser and the Collateral Agent.
NOW THEREFORE, in consideration of the premises and of the agreements
herein contained, and for due and adequate consideration, which the parties
hereto hereby acknowledge, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions. As used in this Agreement and
unless the context requires a different meaning, capitalized terms used but not
defined herein (including the preamble and the recitals hereto) shall have the
meanings assigned to such terms in (i) the Series 1998-1 Supplement, as such
may be amended, supplemented, restated or otherwise modified from time to time
in accordance with the terms thereof, (ii) the Definitions List attached as
Annex A to the Liquidity Agreement, as such Definitions List may be amended,
supplemented, restated or otherwise modified from time to time in accordance
with the terms of the Liquidity Agreement, and (iii) the Definitions List
attached as Schedule 1 to the Base Indenture as in effect as of the date
hereof, as such Definitions List may be further amended, supplemented, restated
or otherwise modified from time to time in accordance with the terms of the
Base Indenture, provided that to the extent, if any, that any capitalized term
used but not defined herein has a meaning assigned to such term in more than
one of the lists or agreements referred to in clauses (i) through (iii), then
(x) if a meaning is assigned to such term in the Series 1998-1 Supplement, such
meaning shall apply herein, and (y) if a meaning is not assigned to such term
in the Series 1998-1 Supplement, then the meaning assigned to such term in the
Definitions List attached as Annex A to the Liquidity Agreement shall apply
herein. In addition, the following terms shall have the following meanings and
the definitions of such terms are applicable to the singular as well as the
plural form of such terms and to the masculine as well as the feminine and
neuter genders of such terms:
"Commitment Amount" means, as to the Note Purchaser, the
dollar amount set forth under its name on the signature pages hereof, as such
amount may be modified from time to time by written agreement between the Note
Purchaser, the Master Servicer and RCFC in accordance with the terms hereof.
"Increase Date" shall mean the Business Day on which an
Increase in the Series 1998-1 Invested Amount occurs.
-2-
<PAGE> 6
"Initial Advance" means the Advance made under this Agreement
as part of the initial Borrowing.
"Majority Program Support Providers" means Program Support
Providers holding more than 50% of the aggregate commitments of all Program
Support Providers.
ARTICLE II
PURCHASE AND SALE OF THE NOTES
SECTION 2.01 Purchases. Subject to the terms and conditions
of this Agreement and the Series 1998-1 Supplement, the Note Purchaser shall
upon RCFC's request and satisfaction of all conditions precedent thereto, make
Advances from time to time during the Series 1998-1 Revolving Period, provided,
that (x) the Note Purchaser will not be required or permitted to make an
Advance on any date if, after giving effect to such Advance, the Series 1998-1
Invested Amount would exceed the Series 1998-1 Maximum Invested Amount, (y) the
Note Purchaser will not be required or permitted to make any Advance if, after
giving effect thereto and the use of proceeds therefrom, either (i) a Series
1998-1 Enhancement Deficiency exists or would exist, (ii) an Asset Amount
Deficiency exists or would exist or (iii) a CP Borrowing Base Deficiency exists
or would exist as determined by the Master Servicer. All Advances on any date
shall be allocated (i) with respect to the Initial Advance, according to the
Series 1998-1 Initial Invested Amount; and (ii) thereafter, according to the
provisions in Section 4A.2 of the Series 1998-1 Supplement for allocating
Increases to the Series 1998-1 Invested Amount. Each of the Advances to be
made on any date shall be made singly as part of a single borrowing (each such
single borrowing being a "Borrowing"). Subject to the terms of this Agreement
and the Series 1998- 1 Supplement, the aggregate principal amount of the
Advances represented by the Series 1998-1 Notes may be increased or decreased
from time to time.
SECTION 2.02 Borrowing Procedures. Whenever RCFC wishes the
Note Purchaser to make an Advance, RCFC shall (or shall cause the Master
Servicer to) notify each of the Collateral Agent and the Trustee upon
irrevocable written notice delivered to the Collateral Agent and the Trustee no
later than the opening of business on the Business Day of the proposed
Borrowing (which Borrowing date shall, except in the case of the Initial
Advances, be an Increase Date). Each such notice shall be irrevocable and
shall in each case refer to this Agreement and specify the aggregate amount of
the requested Borrowing to be made on such date (which Borrowing shall be in an
amount equal to at least $250,000 and, in the case of the Initial Advance only,
in an aggregate minimum amount of $1,000,000. The Collateral Agent shall
promptly advise the Note Purchaser of any notice given pursuant to this
section, and promptly upon the Collateral Agent's receipt of notice from the
Note Purchaser on whether the Note Purchaser shall make such Advances shall
notify each of RCFC and the Trustee whether the Note Purchaser has determined
to make such Advances. On the date of
-3-
<PAGE> 7
each Borrowing and subject to the other conditions set forth herein and in the
Series 1998-1 Supplement, the Note Purchaser shall make available to RCFC the
amount of such Advance by wire transfer in U.S. dollars of such amount in same
day funds to the Series 1998-1 Collection Account no later than 5:00 p.m. (New
York City time) on the proposed date of such Borrowing.
SECTION 2.03 Decreases. (a) Mandatory Decreases. Whenever
the Enhancement Amount is less than the Minimum Enhancement Amount or an Asset
Amount Deficiency exists, then, on the Payment Date immediately following
discovery of such deficiency, RCFC shall decrease the Series 1998-1 Invested
Amount of the Series 1998-1 Notes as required under Section 4A.3(a) of the
Series 1998-1 Supplement.
(b) Voluntary Decreases. Upon at least three (3) Business
Days' prior irrevocable notice to the Note Purchaser in writing, RCFC may
voluntarily reduce the Series 1998-1 Invested Amount of the Series 1998-1 Notes
in accordance with the procedures set forth in Section 4A.3(b) of the Series
1998-1 Supplement.
SECTION 2.04 CP Stop Issuance Events. Notwithstanding
anything to the contrary herein, upon the occurrence and during the
continuation of a CP Stop Issuance Event, the Note Purchaser shall not make any
Advances hereunder and shall not issue Commercial Paper Notes in order to fund
or maintain its investments in the Series 1998-1 Notes. Each of RCFC and the
Master Servicer agrees to give the Collateral Agent and the Note Purchaser
prompt written notice of any CP Stop Issuance Event. It is expressly
understood that the occurrence of a CP Stop Issuance Event once no longer
continuing shall not relieve the Note Purchaser of its obligation to make
future Advances hereunder.
ARTICLE III
INTEREST AND FEES
SECTION 3.01 Interest. Each Advance funded or maintained by
the Note Purchaser during the relevant Fixed Period (a) through the issuance of
Commercial Paper Notes shall bear interest at the CP Rate for such Fixed Period
as determined by DTFC pursuant to the Liquidity Agreement and (b) through means
other than the issuance of Commercial Paper Notes shall bear interest at (i)
the Base Rate as determined by the Liquidity Agent pursuant to the Liquidity
Agreement or (ii) if the required notice has been given, the Eurodollar Rate
for such Fixed Period as determined by the Liquidity Agent pursuant to the
Liquidity Agreement, except as otherwise provided in the definition of Fixed
Period; provided, however, that in each case, if a Series 1998-1 Rapid
Amortization Period has commenced and is continuing, then interest on the
Advances shall bear interest at a per annum rate equal to the Base Rate plus
0.50%.
-4-
<PAGE> 8
(a) Interest shall be due and payable on each Payment Date in
accordance with the provisions set forth in Section 4.9 of the Series 1998-1
Supplement.
(b) All computations of interest at the CP Rate and
Eurodollar Rate shall be made on the basis of a year of 360 days and the actual
number of days elapsed and all computations of interest at the Base Rate shall
be made on the basis of a 365 (or 366, as applicable) day year and actual
number of days elapsed. Whenever any payment of interest or principal in
respect of any Advance shall be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day and such extension of
time shall be included in the computation of the amount of interest owed.
SECTION 3.02 [Reserved].
SECTION 3.03 Certain Eurocurrency Rate and Other Provisions
under the Liquidity Agreement and Credit Agreement. If any Program Support
Provider is unable to provide Eurodollar loans, or experiences increased costs,
funding losses, increased capital costs, taxes, or other expenses pursuant to
Sections 5.1, 5.2, 5.3, 5.4, 5.5, and 5.6 of the Liquidity Agreement or
Sections 5.1, 5.2, 5.3, 5.4, 5.5, and 5.6 of the Credit Agreement, such amounts
shall be payable by RCFC to DTFC and by DTFC directly to such Program Support
Provider. DTFC agrees that any notices it receives from any Program Support
Provider pursuant to such sections shall be promptly remitted by DTFC to RCFC.
SECTION 3.04 Carrying Charges. Any amounts payable by RCFC
or DTFC under Section 3.03 shall constitute Carrying Charges within the meaning
of the Indenture.
ARTICLE IV
OTHER PAYMENT TERMS
SECTION 4.01 Time and Method of Payment. All amounts payable
to the Note Purchaser hereunder or with respect to the Series 1998-1 Notes
shall be made to the Collateral Agent for deposit to the Collateral Account by
wire transfer of immediately available funds in Dollars not later than 2:00
p.m., New York City time, on the date due. Any funds received after that time
will be deemed to have been received on the next Business Day. The Collateral
Agent shall distribute all payments to the Note Purchaser for deposit to the
Collateral Account prior to the close of business on the Business Day on which
any payment is deemed received.
-5-
<PAGE> 9
ARTICLE V
REPRESENTATIONS AND WARRANTIES
SECTION 5.01 RCFC. RCFC represents and warrants to the Note
Purchaser that each of its representations and warranties in the Base
Indenture, the Master Lease and the other Related Documents is true and correct
and further represents and warrants that:
(a) no Amortization Event, Liquidation Event of
Default or Limited Liquidation Event of Default or event which, with
the giving of notice or the passage of time or both would constitute
any of the foregoing, has occurred and is continuing;
(b) assuming the Note Purchaser is not purchasing
with a view toward further distribution and there has been no general
solicitation or general advertising within the meaning of the
Securities Act, the offer and sale of the Series 1998-1 Notes in the
manner contemplated by this Agreement is a transaction exempt from the
registration requirements of the Securities Act, and the Base
Indenture is not required to be qualified under the Trust Indenture
Act;
(c) RCFC has furnished to the Collateral Agent true,
accurate and (except as otherwise consented by the Collateral Agent)
complete copies of all other Related Documents (including all other
series supplements) to which it is a party as of the Series 1998-1
Closing Date, all of which Related Documents are in full force and
effect as of the Series 1998-1 Closing Date and no terms of any such
agreements or documents have been amended, modified or otherwise
waived as of such date; and
(d) the Commercial Paper Notes have been rated A-1
by Standard & Poor's, P-1 by Moody's, and D-1 by DCR both of which
ratings are in effect and neither of which ratings has been reduced or
withdrawn for any reason other than due to a downgrade or withdrawal
of the rating of a Liquidity Lender.
SECTION 5.02 Master Servicer. The Master Servicer represents
and warrants to the Note Purchaser that:
(a) each representation and warranty made by it in
the Master Lease and each Related Document to which it is a party
(including any representations and warranties made by it as Master
Servicer) is true and correct in all material respects as of the date
originally made and as of the Series 1998-1 Closing Date;
(b) the audited consolidated balance sheet of the
Master Servicer and its Consolidated Subsidiaries as of December 31,
1996 and the related statements of income, changes in stockholders
equity and cash flow as of and for the fiscal year ending on such date
(including in each case the schedules and notes thereto) (the
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"Financial Statements"), have been prepared in accordance with GAAP
and present fairly in all material respects the financial position of
the Master Servicer and its Consolidated Subsidiaries as of the dates
thereof and the results of their operations for the periods covered
thereby.
SECTION 5.03 Note Purchaser. The Note Purchaser represents
and warrants to RCFC and the Master Servicer, as of the date hereof (or as of a
subsequent date on which a successor or assign of the Note Purchaser shall
become a party hereto), that:
(a) it has had an opportunity to discuss RCFC's and
the Master Servicer's business, management and financial affairs, and
the terms and conditions of the proposed purchase, with RCFC and the
Master Servicer and their respective representatives;
(b) it is an "accredited investor" within the
meaning of Rule 501(a) of Regulation D under the Securities Act and
has sufficient knowledge and experience in financial and business
matters to be capable of evaluating the merits and risks of investing
in, and is able and prepared to bear the economic risk of investing
in, the Series 1998-1 Notes;
(c) it is purchasing the Series 1998-1 Notes for its
own account, or for the account of one or more "accredited investors"
within the meaning of Rule 501(a) of Regulation D under the Securities
Act that meet the criteria described in subsection (b) and for which
it is acting with complete investment discretion, for investment
purposes only and not with a view to distribution, subject,
nevertheless, to the understanding that the disposition of its
property shall at all times be and remain within its control;
(d) it understands that the Series 1998-1 Notes have
not been and will not be registered or qualified under the Securities
Act or any applicable state securities laws or the securities laws of
any other jurisdiction and are being offered only in a transaction not
involving any public offering within the meaning of the Securities Act
and may not be resold or otherwise transferred unless so registered or
qualified or unless an exemption from registration or qualification is
available, that RCFC is not required to register the Series 1998-1
Notes, and that any transfer must comply with provisions of Section
2.9 of the Base Indenture;
(e) it understands that the Series 1998-1 Notes will
bear the legend set out in the form of Series 1998-1 Notes attached as
Exhibit A to the Series 1998-1 Supplement and be subject to the
restrictions on transfer described in such legend;
(f) it will comply with all applicable federal and
state securities laws in connection with any subsequent resale of the
Series 1998-1 Notes;
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(g) it understands that the Series 1998-1 Notes may
be offered, resold, pledged or otherwise transferred with the Master
Servicer's prior written consent only (A) to RCFC, (B) in a
transaction meeting the requirements of Rule 144A under the Securities
Act, (C) outside the United States to a foreign person in a
transaction meeting the requirements of Regulation S under the
Securities Act, or (D) in a transaction complying with or exempt from
the registration requirements of the Securities Act and in accordance
with any applicable securities laws of any state of the United States
or any other jurisdiction;
(h) if it desires to offer, sell or otherwise
transfer, pledge or hypothecate the Series 1998- 1 Notes as described
in clause (B) or (D) of the preceding paragraph, the transferee of the
Series 1998-1 Notes will be required to deliver a certificate and may
under certain circumstances be required to deliver an opinion of
counsel, in each case, as described in the Base Indenture, reasonably
satisfactory in form and substance to the applicable seller, that an
exemption from the registration requirements of the Securities Act
applies to such offer, sale, transfer or hypothecation. Upon original
issuance thereof, and until such time as the same may no longer be
required under the applicable requirements of the Securities Act, the
certificate evidencing the Series 1998-1 Notes (and all securities
issued in exchange therefor or substitution thereof) shall bear a
legend substantially in the form of the Series 1998-1 Notes included
in the Series 1998-1 Supplement. The Note Purchaser understands that
the registrar and transfer agent for the Series 1998-1 Notes will not
be required to accept for registration of transfer the Series 1998-1
Notes acquired by it, except upon presentation of an executed letter
in this form; and
(i) it will obtain from any purchaser of the Series
1998-1 Notes substantially the same representations and warranties
contained in the foregoing paragraphs.
ARTICLE VI
CONDITIONS
SECTION 6.01 Conditions to Issuance. The Note Purchaser will
have no obligation to purchase the Series 1998-1 Notes hereunder unless:
(a) the Base Indenture shall be in full force and
effect; and
(b) at the time of such issuance, all conditions to
the issuance of the Series 1998-1 Notes under the Series 1998-1
Supplement and under Section 2.2 of the Base Indenture shall have been
satisfied.
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SECTION 6.02 Conditions to Initial Borrowing. The obligation
of the Note Purchaser to fund the initial Borrowing hereunder shall be subject
to the satisfaction of the conditions precedent that the Collateral Agent shall
have received duly executed and authenticated Series 1998-1 Notes registered in
its name and stating that the principal amount thereof shall not exceed the
Series 1998-1 Maximum Invested Amount.
SECTION 6.03 Conditions to Each Borrowing. The obligation of
the Note Purchaser to fund any Borrowing on any day (including the initial
Borrowing) shall be subject to the conditions precedent that on the date of the
Borrowing, before and after giving effect thereto and to the application of any
proceeds therefrom, the following statements shall be true:
(a) (i) the representations and warranties of RCFC
set out in this Agreement (with the exception of Sections 5.01(b) and
5.01(d), which shall have been true and accurate in all material
respects on the Series 1998-1 Closing Date), (ii) the representations
and warranties of the Master Servicer set out in this Agreement (with
the exception of Sections 5.02(a) and 5.02(b), which shall have been
true and accurate on the Series 1998-1 Closing Date), and (iii) the
representations and warranties of RCFC and the Master Servicer set out
in the Base Indenture and the other CP Program Documents and other
Related Documents to which each is a party (with the exception of
Sections 23.2, 23.3, 23.4 and 23.9 of the Master Lease, which shall
have been true and accurate on the Series 1998-1 Closing Date) shall,
in each such case, be true and accurate as of the date of the
Borrowing with the same effect as though made on that date (unless
stated to relate solely to an earlier date, in which case such
representations and warranties shall be true and correct as of such
earlier date); provided that, with respect to the representations and
warranties of RCFC and the Master Servicer in the Base Indenture only,
and without limiting any representations and warranties of RCFC
contained in any other Related Document or CP Program Document, the
condition precedent set forth in this Section 6.03(a) shall be
satisfied if such representations and warranties are true and correct
in all material respects (to the extent such representation and
warranty does not contain a materiality limitation in its terms) on
the applicable date referred to in this Section 6.03(a);
(b) the Series 1998-1 Rapid Amortization Period has
not commenced;
(c) the Collateral Agent shall have received the
Monthly Noteholders' Statement for the Related Month immediately
preceding the date of such Borrowing and an executed advance request
in the form of Exhibit A hereto (each such request, an "Advance
Request") certifying as to the current Aggregate Asset Amount,
Enhancement Amount and CP Borrowing Base; and
(d) all conditions specified in Section 2.01 of this
Agreement shall have been satisfied.
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The giving of any notice pursuant to Section 2.02 shall
constitute a representation and warranty by RCFC and the Master Servicer that
all conditions precedent to such Borrowing have been satisfied.
ARTICLE VII
COVENANTS
SECTION 7.01 Covenants. RCFC and the Master Servicer each
severally covenants and agrees that, until the Series 1998-1 Notes have been
paid in full and the obligation of the Note Purchaser to make Advances have
terminated, it will:
(a) duly and timely perform and cause the Lessees to
duly and timely perform all of their respective covenants and
obligations under each Related Document to which it is a party;
(b) not and will cause the Lessees not to, except as
contemplated by Section 3.2(a) of the Base Indenture with respect to
the Master Lease or clauses (d) through (h) of Section 11.1 of the
Base Indenture, amend, modify, waive or give any approval, consent or
permission under, any provision of the Base Indenture or any other
Related Document to which it is a party unless any such amendment,
modification, waiver or other action is in writing and made in
accordance with the terms of the Base Indenture or such other Related
Document, as applicable;
(c) at the same time any report, notice or other
document is provided to the Rating Agencies and/or the Trustee, or
caused to be provided, by RCFC or the Master Servicer under the Base
Indenture (including, without limitation, under Sections 7.3, 7.10,
7.11 and/or 7.14 thereof), or by any of the Lessees or the Master
Servicer to RCFC under the Master Lease (including, without
limitation, under Section 24.4 thereof), provide the Collateral Agent
with a copy of such report, notice or other document; provided,
however, that neither the Master Servicer nor RCFC shall have any
obligation under this Section 7.01(c) to deliver to the Collateral
Agent copies of any (i) Monthly Noteholders' Statements which relate
solely to a series of Notes other than the Series 1998-1 Notes or (ii)
vehicle identification number listings;
(d) at any time and from time to time, following
reasonable prior notice from the Collateral Agent, and during regular
business hours, permit the Collateral Agent, or its agents,
representatives or permitted assigns, access to the offices of, the
Master Servicer, any Lessee and RCFC applicable, (i) to examine and
make copies of and abstracts from all documentation relating to the
Collateral on the same terms as are provided to the Trustee
under Section 7.8 of the Base Indenture, as applicable, and (ii) to
visit the offices and properties of, the Master Servicer, any Lessee
and RCFC for
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the purpose of examining such materials described in clause (i) above,
and to discuss matters relating to the Collateral, or the
administration and performance of the Base Indenture, the Series
1998-1 Supplement and the other Related Documents with any of the
officers or employees of, the Master Servicer, any Lessee and/or RCFC,
as applicable, having knowledge of such matters;
(e) [reserved];
(f) promptly upon becoming aware of any Potential
Amortization Event, Amortization Event, Potential Lease Event of
Default, Lease Event of Default, Potential Event of Default (as
defined in the CP Enhancement Letter of Credit Application and
Agreement) or Event of Default (as defined in the CP Enhancement
Letter of Credit Application and Agreement), provide the Liquidity
Agent and each of the Liquidity Lenders in the manner provided in
Section 11.2 of the Liquidity Agreement with written notice thereof;
(g) not amend any of its Organic Documents without
the prior written consent of the Required Liquidity Providers and each
of the Rating Agencies; and
(h) deliver to each of the Collateral Agent and the
Liquidity Agent in the manner provided in Section 9.04 of the
Collateral Agreement the notice required to be provided by RCFC to
each of the Trustee and the Master Collateral Agent regarding any
change in the location of its principal office or change in its name
pursuant to Section 7.21 of the Base Indenture simultaneously within
the time frame in which such notice is required to be delivered to the
Trustee and the Master Collateral Agent.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
SECTION 8.01 Amendments. No amendment to or waiver of any
provision of this Agreement, nor consent to any departure by the Master
Servicer, RCFC or the Collateral Agent therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Master
Servicer, RCFC, the Collateral Agent and the Note Purchaser, and Rating Agency
confirmation shall have been obtained with respect thereto; provided, however,
that any amendment to or waiver of any provision of this Agreement, or any
consent to or any departure by the Master Servicer, RCFC or the Collateral
Agent herefrom shall not require Rating Agency confirmation to be obtained with
respect thereto if such amendment or waiver or any such consent or departure
herefrom is effected only to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision herein or
which is otherwise defective, or to make any other provisions with respect to
matters or
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questions arising under this Agreement which shall not be inconsistent with the
provisions of this Agreement or the other CP Program Documents or other Related
Documents.
SECTION 8.02 No Waiver; Remedies. Any waiver, consent or
approval given by any party hereto shall be effective only in the specific
instance and for the specific purpose for which given, and no waiver by a party
of any breach or default under this Agreement shall be deemed a waiver of any
other breach or default. No failure on the part of any party hereto to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right
hereunder, or any abandonment or discontinuation of steps to enforce the right,
power or privilege, preclude any other or further exercise thereof or the
exercise of any other right. No notice to or demand on any party hereto in any
case shall entitle such party to any other or further notice or demand in the
same, similar or other circumstances. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
SECTION 8.03 Binding on Successors and Assigns. (a) This
Agreement shall be binding upon, and inure to the benefit of, RCFC, the Master
Servicer, the Collateral Agent, the Note Purchaser and their respective
successors and assigns; provided, however, that neither RCFC nor the Master
Servicer may assign its rights or obligations hereunder or in connection
herewith or any interest herein (voluntarily, by operation of law or otherwise)
without the prior written consent of the Note Purchaser and provided, further,
that the Note Purchaser may not transfer, pledge, assign, sell participations
in or otherwise encumber its rights or obligations hereunder or in connection
herewith or any interest herein except as permitted under this section.
Nothing expressed herein is intended or shall be construed to give any Person
other than the Persons referred to in the preceding sentence any legal or
equitable right, remedy or claim under or in respect of this Agreement.
(b) Notwithstanding any other provision set forth in this
Agreement, the Note Purchaser may at any time grant to one or more Program
Support Providers a participating interest in or lien on the Note Purchaser's
interests in the Advances made hereunder and such Program Support Provider,
with respect to its participating interest, shall be entitled to the benefits
of the Note Purchaser under this Agreement.
SECTION 8.04 Survival of Agreement. All covenants,
agreements, representations and warranties made herein and in the Series 1998-1
Notes delivered pursuant hereto shall survive the making and the repayment of
the Advances and the execution and delivery of this Agreement and the Series
1998-1 Notes and shall continue in full force and effect until all interest and
principal on the Series 1998-1 Notes and other amounts owed hereunder have been
paid in full and the commitment of the Note Purchaser hereunder has been
terminated. In addition, the obligations of RCFC and DTFC under Section 3.03
shall survive the termination of this Agreement.
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SECTION 8.05 Payment of Costs and Expenses; Indemnification.
(a) Payment of Costs and Expenses. RCFC agrees to pay on demand (or reimburse)
all reasonable expenses of the Note Purchaser (including the reasonable fees
and out-of-pocket expenses of counsel to the Note Purchaser, if any, who may be
retained by counsel to the Note Purchaser) in connection with
(i) the negotiation, preparation, execution, delivery and
administration of this Agreement and of each other Related Document,
including schedules and exhibits, and any amendments, waivers,
consents, supplements or other modifications to this Agreement or any
other Related Document as may from time to time hereafter be proposed,
whether or not the transactions contemplated hereby or thereby are
consummated, and
(ii) the consummation and performance of the transactions
contemplated by this Agreement, the CP Program Documents and the other
Related Documents, including, without limitation, fees, costs,
expenses and indemnities for the Collateral Agent, Liquidity Agent,
each Liquidity Lender, each Dealer, and the Depositary.
RCFC further agrees to pay, and to save the Note Purchaser harmless from all
liability for, (i) any breach by RCFC of its obligations under this Agreement
(ii) all reasonable costs incurred by the Note Purchaser in enforcing this
Agreement and (iii) any stamp, documentary or other taxes which may be payable
in connection with the execution or delivery of this Agreement, any Borrowing
hereunder, or the issuance of the Series 1998-1 Notes or any other Related
Documents. RCFC also agrees to reimburse the Note Purchaser upon demand for
all reasonable out-of-pocket expenses incurred by the Note Purchaser in
connection with (x) the negotiation of any restructuring or "work-out", whether
or not consummated, of the Related Documents and (y) the enforcement of the
Related Documents.
(b) Indemnification. In consideration of the execution and
delivery of this Agreement by the Note Purchaser, RCFC hereby indemnifies and
holds the Note Purchaser, the Collateral Agent, and each of their respective
officers, directors, employees and agents (collectively, the "Indemnified
Parties") harmless from and against any and all actions, causes of action,
suits, losses, costs, liabilities and damages, and reasonable expenses incurred
in connection therewith (irrespective of whether any such Indemnified Party is
a party to the action for which indemnification hereunder is sought and
including, without limitation, any liability in connection with the offering
and sale of the Series 1998-1 Notes), including reasonable attorneys' fees and
disbursements (collectively, the "Indemnified Liabilities"), incurred by the
Indemnified Parties or any of them (whether in prosecuting or defending against
such actions, suits or claims) as a result of, or arising out of, or relating
to
(i) any transaction financed or to be financed in whole
or in part, directly or indirectly, with the proceeds of any Advance;
or
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(ii) the entering into and performance of this Agreement
and any other Related Document by any of the Indemnified Parties,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's
gross negligence or willful misconduct. If and to the extent that the
foregoing undertaking may be unenforceable for any reason, RCFC hereby agrees
to make the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under applicable law. The
indemnity set forth in this Section 8.05(b) shall in no event include
indemnification for any taxes (which indemnification is provided in Section
3.03). RCFC shall give notice to the Rating Agencies of any claim for
Indemnified Liabilities made under this Section.
(c) Carrying Charges. All expenses payable under this Section
8.05 shall constitute Carrying Charges within the meaning of the Indenture.
SECTION 8.06 Characterization as Related Document; Entire
Agreement. This Agreement shall be deemed to be a Related Document for all
purposes of the Base Indenture and the other Related Documents. This
Agreement, together with the Base Indenture, the Series 1998-1 Supplement, the
documents delivered pursuant to Section 6.01 and the other Related Documents,
including the exhibits and schedules thereto, contains a final and complete
integration of all prior expressions by the parties hereto with respect to the
subject matter hereof and shall constitute the entire agreement among the
parties hereto with respect to the subject matter hereof, superseding all
previous oral statements and other writings with respect thereto.
SECTION 8.07 Notices. All notices, amendments, waivers,
consents and other communications provided to any party hereto under this
Agreement shall be in writing and addressed, delivered or transmitted to such
party at its address or facsimile number set forth below its signature hereto
or at such other address or facsimile number as may be designated by such party
in a notice to the other parties. Any notice, if mailed and properly addressed
with postage prepaid or if properly addressed and sent by pre-paid courier
service, shall be deemed given when received; any notice, if transmitted by
facsimile, shall be deemed given when transmitted upon receipt of electronic
confirmation of transmission.
SECTION 8.08 Severability of Provisions. Any covenant,
provision, agreement or term of this Agreement that is prohibited or is held to
be void or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of the prohibition or unenforceability without
invalidating the remaining provisions of this Agreement.
SECTION 8.09 Tax Characterization. Each party to this
Agreement (a) acknowledges that it is the intent of the parties to this
Agreement that, for accounting purposes and for all federal, state and local
income and franchise tax purposes, the Series 1998-1 Notes
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will be treated as evidence of indebtedness issued by RCFC, (b) agrees to treat
the Series 1998-1 Notes for all such purposes as indebtedness and (c) agrees
that the provisions of the Related Documents shall be construed to further
these intentions.
SECTION 8.10 No Proceedings; Limited Recourse. (a) RCFC.
Each of DTAG, the Collateral Agent (solely in its capacity as such) and the
Note Purchaser (solely in its capacity as such) hereby covenants and agrees
that, prior to the date which is one year and one day after the payment in full
of any Notes issued by RCFC pursuant to the Base Indenture, it will not
institute against, or join with any other Person in instituting against, RCFC,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any Federal or state bankruptcy or
similar law, all as more particularly set forth in Section 12.16 of the Base
Indenture and subject to any retained rights set forth therein; provided,
however, that nothing in this Section 8.10(a) shall constitute a waiver of any
right to indemnification, reimbursement or other payment from RCFC pursuant to
this Agreement, the Series 1998-1 Supplement or the Base Indenture. In the
event that DTAG, the Collateral Agent (solely in its capacity as such) or the
Note Purchaser (solely in its capacity as such) takes action in violation of
this Section 8.10(a), RCFC agrees that it shall file an answer with the
bankruptcy court or otherwise properly contest the filing of such a petition by
any such Person against RCFC or the commencement of such action and raise the
defense that such Person has agreed in writing not to take such action and
should be estopped and precluded therefrom and such other defenses, if any, as
its counsel advises that it may assert. The provisions of this Section 8.10(a)
shall survive the termination of this Agreement and the resignation or removal
of the Collateral Agent. Nothing contained herein shall preclude participation
by DTAG, the Collateral Agent or the Note Purchaser in assertion or defense of
its claims in any such proceeding involving RCFC. The obligations of RCFC
under this Agreement are solely the corporate obligations of RCFC. No recourse
shall be had for the payment of any amount owing in respect of this Agreement,
including the payment or any fee hereunder or any other obligation or claim
arising out of or based upon this Agreement, against any stockholder, employee,
officer, director, affiliate or incorporator of RCFC; provided, however,
nothing in this Section 8.10(a) shall relieve any of the foregoing Persons from
any liability which any such Person may otherwise have for its gross negligence
or willful misconduct. In addition, each of the parties hereto agree that all
fees, expenses and other costs payable hereunder by RCFC shall be payable only
to the extent set forth in Section 12.17 of the Base Indenture and that all
other amounts owed to them by RCFC shall be payable solely from amounts that
become available for payment pursuant to the Base Indenture and the Series
1998-1 Supplement.
(b) DTFC. Each of RCFC, the Master Servicer and the
Collateral Agent (solely in its capacity as such), hereby covenants and agrees
that it will not, and the Master Servicer will cause the Lessees not to, prior
to the date which is one year and one day after the payment in full of the
latest maturing Commercial Paper Notes, institute against, or join with any
other Person in instituting against, DTFC, any bankruptcy, reorganization,
arrangement,
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insolvency or liquidation proceedings, or other proceedings under any federal
or state bankruptcy or similar law, subject to any retained rights set forth
therein; provided, however, that nothing in this Section 8.10(b) shall
constitute a waiver of any right to indemnification, reimbursement or other
payment from DTFC pursuant to the Collateral Agreement or other CP Program
Document or other Related Document. In the event that RCFC, the Master
Servicer, the Collateral Agent (solely in its capacity as such) or any of the
Lessees takes action in violation of this Section 8.10(b), DTFC agrees that it
shall file an answer with the bankruptcy court or otherwise properly contest
the filing of such a petition by any such Person against DTFC or the
commencement of such action and raise the defense that such Person has agreed
in writing not to take such action and should be estopped and precluded
therefrom and such other defenses, if any, as its counsel advises that it may
assert. The provisions of this Section 8.10(b) shall survive the termination
of this Agreement and the resignation or removal of the Collateral Agent.
Nothing contained herein shall preclude participation by RCFC, the Master
Servicer, the Collateral Agent or any Lessee in assertion or defense of its
claims in any such proceeding involving DTFC. The obligations of DTFC under
this Agreement are solely the corporate obligations of DTFC. No recourse shall
be had for the payment of any amount owing in respect of this Agreement,
including the payment or any fee hereunder or any other obligation or claim
arising out of or based upon this Agreement, against any stockholder, employee,
officer, director, affiliate or incorporator of DTFC; provided, however,
nothing in this Section 8.10(b) shall relieve any of the foregoing Persons from
any liability which any such Person may otherwise have for its gross negligence
or willful misconduct.
SECTION 8.11 Confidentiality. Each of the Collateral Agent
and the Note Purchaser agrees that it shall not disclose any Confidential
Information to any Person without the prior written consent of DTFC, the Master
Servicer, RCFC and the applicable Lessee. Notwithstanding anything herein to
the contrary, the foregoing shall not be construed to prohibit any party hereto
from (i) disclosing any and all information that is or becomes publicly known
through no fault of a Secured Party, (ii) disclosure of any and all information
(which makes reference to RCFC or DTFC or this transaction) obtained by any
Secured Party from sources (other than RCFC or DTFC) that have not notified the
Secured Party or Parties that such information is subject to a confidentiality
obligation with RCFC or DTFC (iii) disclosing any and all information (A) if
required to do so by any applicable statute, law, rule or regulation, (B) to
any government agency or regulatory body having or claiming authority to
regulate or oversee any aspects of a Secured Party's business or that of its
Affiliates, (C) pursuant to any subpoena, civil investigative demand or similar
demand or request of any court, regulatory authority, arbitrator or arbitration
to which any Secured Party or an Affiliate or an officer, director or employee
thereof is a party, (D) in any preliminary or final offering circular,
registration statement or contract or other document pertaining to the
transactions contemplated herein approved in advance by RCFC or DTFC or (E) to
any Affiliate, independent or internal auditor, agent, employee or attorney of
any Secured Party having a need to know the same, provided that the Secured
Party advises such recipient of the
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confidential nature of the information being disclosed or (iv) any other
disclosure authorized by RCFC or DTFC.
"Confidential Information" means information that DTFC, RCFC, the
Master Servicer or the applicable Lessee furnishes to the Collateral Agent or
the Note Purchaser on a confidential basis, but does not include any such
information that is or becomes generally available to the public other than as
a result of a disclosure by the Collateral Agent or the Note Purchaser or other
Person to which the Collateral Agent or the Note Purchaser delivered such
information or that is or becomes available to the Collateral Agent or the Note
Purchaser from a source other than DTFC, RCFC, the Master Servicer or
applicable Lessee, provided that such source is not (1) known to the Collateral
Agent or the Note Purchaser to be bound by a confidentiality agreement with
DTFC, RCFC, the Master Servicer or the applicable Lessee, as the case may be,
or (2) known to the Collateral Agent or the Note Purchaser to be otherwise
prohibited from transmitting the information by a contractual, legal or
fiduciary obligation.
SECTION 8.12 Governing Law. THIS AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO OTHERWISE APPLICABLE PRINCIPLES OF CONFLICTS OF LAW.
SECTION 8.13 Counterparts. This Agreement may be executed in
any number of counterparts (which may include facsimile) and by the different
parties hereto in separate counterparts, each of which when so executed shall
be deemed to be an original, and all of which together shall constitute one and
the same instrument.
[Remainder of Page Intentionally Blank]
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<PAGE> 21
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized officers and delivered
as of the day and year first above written.
RENTAL CAR FINANCE CORP.
By:
------------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
Attention: Pamela S. Peck
Telephone: (918) 669-2550
Facsimile: (918) 669-2301
DOLLAR THRIFTY AUTOMOTIVE GROUP,
INC.
By:
------------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
Attention: Steven B. Hildebrand
Telephone: (918) 660-7700
Facsimile: (918) 669-2970
-18-
<PAGE> 22
DOLLAR THRIFTY FUNDING CORP.
By:
------------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
Attention: Michael H. McMahon
Telephone: (918) 669-3914
Facsimile: (918) 669-2925
COMMITMENT AMOUNT: $615,000,000
PERCENTAGE: 100%
-19-
<PAGE> 23
Acknowledged and Accepted:
BANKERS TRUST COMPANY,
as Collateral Agent
By:
-----------------------------
Name:
Title:
Address: 4 Albany Street
New York, New York 10006
Attention: Commercial Paper Group
Telephone: (212) 250-3939
Telecopier: (212) 669-5970
-20-
<PAGE> 24
EXHIBIT A
to Note Purchase Agreement
FORM OF ADVANCE REQUEST
Bankers Trust Company,
as Collateral Agent under
the Note Purchase Agreement
referred to below
4 Albany Street
New York, New York 10006
Attention:
Ladies and Gentlemen:
This Advance Request is delivered to you pursuant to Section 6.03(c)
of that certain Note Purchase Agreement, dated as of March 4, 1998 (as amended,
supplemented, restated or otherwise modified from time to time, the "Note
Purchase Agreement"), among Rental Car Finance Corp., an Oklahoma corporation
("RCFC"), Dollar Thrifty Automotive Group, Inc., a Delaware corporation, as
Master Servicer ("DTAG", and in such capacity, the "Master Servicer"), Dollar
Thrifty Funding Corp., an Oklahoma corporation ("DTFC"), and Bankers Trust
Company, a New York banking corporation, as the Collateral Agent (in such
capacity, the "Collateral Agent"). Unless otherwise defined herein or as the
context otherwise requires, terms used herein have the meaning assigned thereto
under Section 1.01 of the Note Purchase Agreement.
The undersigned hereby requests that an Advance be made in the
aggregate principal amount of $___________ on ____________, 19___.
The undersigned hereby certifies that (i) the Aggregate Asset Amount
as of the date hereof is an amount equal to $______________ , (ii) the
Enhancement Amount as of the date hereof is an amount equal to $______________
and (iii) the CP Borrowing Base as of the date hereof is an amount equal to
$________.
The undersigned hereby acknowledges that the delivery of this Advance
Request and the acceptance by undersigned of the proceeds of the Advance
requested hereby constitute a representation and warranty by the undersigned
that, on the date of such Advance, and before and after giving effect thereto
and to the application of the proceeds therefrom, all conditions
<PAGE> 25
set forth in Section 6.03 of the Note Purchase Agreement have been satisfied
and all statements set forth in Section 5.01 of the Note Purchase Agreement are
true and correct.
The undersigned agrees that if prior to the time of the Advance
requested hereby any matter certified to herein by it will not be true and
correct at such time as if then made, it will immediately so notify both you
and the Note Purchaser. Except to the extent, if any, that prior to the time
of the Advance requested hereby you and the Note Purchaser shall receive
written notice to the contrary from the undersigned, each matter certified to
herein shall be deemed once again to be certified as true and correct at the
date of such Advance as if then made.
Please wire transfer the proceeds of the Advance to the following
account pursuant to the following instructions:
[insert payment instructions]
The undersigned has caused this Advance Request to be executed and
delivered, and the certification and warranties contained herein to be made,
by its duly Authorized Officer this ____ day of __________, 19___.
RENTAL CAR FINANCE CORP.
By:
------------------------------------
Title:
------------------------------
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<PAGE> 1
EXHIBIT 4.15
[EXECUTION COPY]
================================================================================
LIQUIDITY AGREEMENT,
Dated as of March 4, 1998,
among
DOLLAR THRIFTY FUNDING CORP.,
CERTAIN FINANCIAL INSTITUTIONS,
as the Liquidity Lenders
and
CREDIT SUISSE FIRST BOSTON,
as the Liquidity Agent for
the Liquidity Lenders
CHASE MANHATTAN BANK,
not as party but as
Administrative Agent
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
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<S> <C> <C>
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Definitions......................................................... 2
SECTION 1.2. Cross-References.................................................... 2
SECTION 1.3. Accounting and Financial Determinations; No Duplication............. 2
ARTICLE II
COMMERCIAL PAPER OPERATIONS
SECTION 2.1. Issuance of Commercial Paper Notes.................................. 3
SECTION 2.2. Conditions to the Issuance of Commercial Paper Notes................ 4
SECTION 2.2.1. Representations and Warranties...................................... 4
SECTION 2.2.2. No Liquidity Agreement Amortization Event........................... 5
SECTION 2.2.3. Available Liquidity Commitment...................................... 5
SECTION 2.2.4. No CP Borrowing Base Deficiency..................................... 5
SECTION 2.2.5. CP Borrowing Base Certificate....................................... 5
SECTION 2.2.6. Non-Payment of Series 1998-1 Notes.................................. 5
SECTION 2.3. Commercial Paper Notes.............................................. 5
SECTION 2.4. Commercial Paper Account; Payment of Commercial Paper
Notes............................................................. 6
SECTION 2.5. Series 1998-1 Pledge Account........................................ 6
ARTICLE III
LIQUIDITY COMMITMENTS, BORROWING PROCEDURES,
LIQUIDITY ADVANCES AND NOTES
SECTION 3.1. Liquidity Commitments............................................... 6
SECTION 3.1.1. Refunding Advance Commitment........................................ 7
SECTION 3.1.2. Swing Line Commitment............................................... 7
SECTION 3.1.3. Use of Proceeds..................................................... 7
SECTION 3.2. Liquidity Lenders Not Required to Make Certain Liquidity
Advances.......................................................... 7
SECTION 3.2.1. Liquidity Advances.................................................. 7
SECTION 3.2.2. Failure To Fund..................................................... 7
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SECTION 3.3. Termination and Reduction of the Liquidity Commitments.............. 8
SECTION 3.4. Increase of the Aggregate Liquidity Commitment...................... 8
SECTION 3.5. Extensions of Scheduled Liquidity Commitment
Termination Date.................................................. 9
SECTION 3.6. Borrowing Procedures................................................ 9
SECTION 3.6.1. Refunding Advances.................................................. 9
SECTION 3.6.2. Swing Line Advances................................................. 10
SECTION 3.6.3. Commitment Termination Date Liquidity Advances...................... 11
SECTION 3.6.4. Nature of Funding Obligations....................................... 12
SECTION 3.6.5. Failure to Fund by Liquidity Lender................................. 12
SECTION 3.7. Disbursement of Funds............................................... 13
SECTION 3.8. Continuation and Conversion Elections............................... 13
SECTION 3.9. Eurodollar Funding.................................................. 14
SECTION 3.10. Liquidity Advance Notes............................................. 14
ARTICLE IV
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES, ETC.
SECTION 4.1. Repayments and Prepayments.......................................... 15
SECTION 4.1.1. Voluntary Prepayments............................................... 15
SECTION 4.1.2. Mandatory Prepayments............................................... 15
SECTION 4.2. Interest Provisions................................................. 16
SECTION 4.2.1. Rates............................................................... 16
SECTION 4.2.2. Post Default Rates.................................................. 17
SECTION 4.3. Payments of Interest................................................ 17
SECTION 4.4. (a) Computation Basis............................................... 18
(b) Determination of Rates......................................... 18
SECTION 4.5. Fees................................................................ 18
ARTICLE V
CERTAIN EURODOLLAR AND OTHER PROVISIONS
SECTION 5.1. Eurodollar Lending Unlawful......................................... 19
SECTION 5.2. Deposits Unavailable................................................ 19
SECTION 5.3. Increased Costs, etc................................................ 19
SECTION 5.4. Funding Losses...................................................... 20
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SECTION 5.5. Increased Capital Costs............................................. 21
SECTION 5.6. Taxes............................................................... 21
SECTION 5.7. Payments, Computations, etc......................................... 25
SECTION 5.8. Sharing of Payments................................................. 25
SECTION 5.9. Replacement of Liquidity Lenders.................................... 26
SECTION 5.10. Order and Priority.................................................. 27
ARTICLE VI
CONDITIONS PRECEDENT
SECTION 6.1. Conditions to Effectiveness......................................... 28
SECTION 6.1.1. Organic Documents, Resolutions...................................... 28
SECTION 6.1.2. Liquidity Agreement................................................. 28
SECTION 6.1.3. Liquidity Advance Notes............................................. 29
SECTION 6.1.4. Collateral Agreement................................................ 29
SECTION 6.1.5. Series 1998-1 Supplement............................................ 29
SECTION 6.1.6. Series 1998-1 Notes................................................. 29
SECTION 6.1.7. Master Lease........................................................ 29
SECTION 6.1.8. Series 1998-1 Letter of Credit...................................... 29
SECTION 6.1.9. Depositary Agreement................................................ 29
SECTION 6.1.10. Dealer Agreement.................................................... 29
SECTION 6.1.11. Absence of Certain Events; Accuracy of Liquidity
Agreement Representations and Warranties; Closing Date
Certificate....................................................... 30
SECTION 6.1.12. Accounts............................................................ 30
SECTION 6.1.13. Rating Letters...................................................... 30
SECTION 6.1.14. Board of Directors.................................................. 30
SECTION 6.1.15. Solvency Certificate................................................ 30
SECTION 6.1.16. Closing Fees and Expenses........................................... 30
SECTION 6.1.17. Certified Copies of Vehicle Disposition Programs.................... 31
SECTION 6.1.18. Opinions, Instruments, Certificates and Other Documents............. 31
SECTION 6.1.19. Notation of Liens................................................... 31
SECTION 6.1.20. Offering Materials.................................................. 31
SECTION 6.1.21. Satisfactory Legal Form............................................. 31
SECTION 6.1.22. Credit Rating of Initial Liquidity Lenders.......................... 31
SECTION 6.1.23. Credit Agreement.................................................... 32
SECTION 6.2. [Reserved].......................................................... 32
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(continued)
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SECTION 6.3. Conditions Precedent to the Making of Each Refunding
Advance........................................................... 32
SECTION 6.3.1. No Bankruptcy....................................................... 32
SECTION 6.3.2. Availability........................................................ 32
SECTION 6.3.3. No Borrowing Base Deficiency........................................ 32
SECTION 6.3.4. Borrowing Request................................................... 32
SECTION 6.3.5. Borrowing Base Certificate.......................................... 32
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. Existence and Power................................................. 33
SECTION 7.2. Authorization....................................................... 33
SECTION 7.3. Binding Effect...................................................... 33
SECTION 7.4. Financial Information; Financial Condition.......................... 33
SECTION 7.5. Litigation.......................................................... 34
SECTION 7.6. No ERISA Plan....................................................... 34
SECTION 7.7. Tax Filings and Expenses............................................ 34
SECTION 7.8. Disclosure.......................................................... 34
SECTION 7.9. Investment Company Act; Securities Act.............................. 34
SECTION 7.10. Margin Regulations.................................................. 34
SECTION 7.11. No Consent.......................................................... 35
SECTION 7.12. No Violation of Laws, etc........................................... 35
SECTION 7.13. Ownership; Subsidiaries............................................. 35
SECTION 7.14. Solvency............................................................ 35
SECTION 7.15. No Security Interest................................................ 35
SECTION 7.16. Vehicle Disposition Programs........................................ 36
SECTION 7.17. Other Representations............................................... 36
ARTICLE VIII
COVENANTS
SECTION 8.1. Affirmative Covenants............................................... 36
SECTION 8.1.1. Information......................................................... 36
SECTION 8.1.2. Compliance with Covenants........................................... 38
SECTION 8.1.3. Payment of Obligations.............................................. 38
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(continued)
<TABLE>
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SECTION 8.1.4. Maintenance of Separate Existence................................... 38
SECTION 8.1.5. Compliance with Laws................................................ 39
SECTION 8.1.6. Inspection of Property, Books and Records........................... 39
SECTION 8.1.7. Absence of Certain Actions.......................................... 39
SECTION 8.1.8. Notice of Default................................................... 40
SECTION 8.1.9. Notice of Material Proceedings...................................... 40
SECTION 8.1.10. Further Requests.................................................... 40
SECTION 8.1.11. Further Assurances.................................................. 40
SECTION 8.1.12. Vehicle Disposition Programs........................................ 40
SECTION 8.1.13. Use of Proceeds of Commercial Paper Notes........................... 41
SECTION 8.1.14. Vehicles............................................................ 41
SECTION 8.2. Negative Covenants.................................................. 41
SECTION 8.2.1. Liens............................................................... 41
SECTION 8.2.2. Other Indebtedness.................................................. 41
SECTION 8.2.3. Consolidations and Mergers ......................................... 41
SECTION 8.2.4. Sales of Assets..................................................... 42
SECTION 8.2.5. Acquisition of Assets............................................... 42
SECTION 8.2.6. Dividends, Officers' Compensation, etc.............................. 42
SECTION 8.2.7. Name; Chief Executive Office........................................ 42
SECTION 8.2.8. Organic Documents................................................... 42
SECTION 8.2.9. Investments......................................................... 42
SECTION 8.2.10. No Other Agreements; Amendments to CP Program
Documents......................................................... 42
SECTION 8.2.11. Other Business...................................................... 43
SECTION 8.2.12. Offering Document................................................... 43
ARTICLE IX
LIQUIDITY AGREEMENT AMORTIZATION EVENTS
SECTION 9.1. Liquidity Agreement Amortization Event.............................. 43
SECTION 9.1.1. Non-Payment of Obligations.......................................... 43
SECTION 9.1.2. Breach of Warranty.................................................. 43
SECTION 9.1.3. Non-Performance of Certain Covenants and Obligations................ 44
SECTION 9.1.4. Non-Performance of Other Covenants and Obligations.................. 44
SECTION 9.1.5. Judgments........................................................... 44
SECTION 9.1.6. Bankruptcy, Insolvency, etc......................................... 44
SECTION 9.1.7. Independent Directors............................................... 44
</TABLE>
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(continued)
<TABLE>
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SECTION 9.1.8. Enforceability of or Default under CP Program Documents............. 44
SECTION 9.1.9. Investment Company.................................................. 45
SECTION 9.1.10. Program Downgrade................................................... 45
SECTION 9.1.11. Termination of Liquidity Commitments or Reduction of
Aggregate Liquidity Commitment.................................... 45
SECTION 9.1.12. Liquidity Advance under Section 3.6.1(b)............................ 45
SECTION 9.1.13. Series 1998-1 Enhancement Deficiency................................ 45
SECTION 9.2. Action if Liquidity Agreement Amortization Event.................... 45
SECTION 9.3. Limited Liquidity Agreement Amortization Events..................... 46
SECTION 9.3.1. Ineligibility of Manufacturer or Repurchase Program................. 46
SECTION 9.3.2. Termination of Liquidity Commitment................................. 47
SECTION 9.3.3. Rating Downgrade of Liquidity Lender................................ 47
SECTION 9.4. Action Upon Limited Liquidity Agreement Amortization
Event............................................................. 47
ARTICLE X
THE LIQUIDITY AGENT
SECTION 10.1. Actions............................................................. 48
SECTION 10.2. Collateral Agreement................................................ 48
SECTION 10.3. Exculpation......................................................... 49
SECTION 10.4. Successor........................................................... 49
SECTION 10.5. Liquidity Advances by CSFB.......................................... 50
SECTION 10.6. Credit Decisions.................................................... 50
SECTION 10.7. Copies, etc......................................................... 50
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1. Waivers, Amendments, etc............................................ 51
SECTION 11.2. Notices............................................................. 53
SECTION 11.3. Payment of Costs and Expenses....................................... 53
SECTION 11.4. Indemnification..................................................... 54
SECTION 11.5. Survival............................................................ 55
SECTION 11.6. Severability........................................................ 55
SECTION 11.7. Headings............................................................ 55
</TABLE>
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SECTION 11.8. Execution in Counterparts........................................... 55
SECTION 11.9. Governing Law; Entire Agreement..................................... 55
SECTION 11.10. Successors and Assigns.............................................. 56
SECTION 11.11. Sale and Transfer of Liquidity Advances and Notes;
Participations in Loans and Notes................................. 56
SECTION 11.11.1. Assignments......................................................... 56
SECTION 11.11.2. Participations...................................................... 58
SECTION 11.12. Other Transactions.................................................. 059
SECTION 11.13. Bankruptcy Petition Against DTFC.................................... 59
SECTION 11.14. Limited Recourse to DTFC; No Recourse............................... 59
SECTION 11.15. Survival of Representations and Warranties.......................... 60
SECTION 11.16. Confidentiality..................................................... 60
SECTION 11.17. Jurisdiction; Consent to Service of Process......................... 61
SECTION 11.18. Waiver of Jury Trial................................................ 62
SECTION 11.19. Waiver of Set-Off................................................... 62
</TABLE>
EXHIBITS
EXHIBIT A - Form of Liquidity Advance Note
EXHIBIT B - Form of Borrowing Request
EXHIBIT C - Form of Continuation/Conversion Notice
EXHIBIT D - Form of Liquidity Lender Assignment Agreement
EXHIBIT E - Form of Closing Date Certificate
EXHIBIT F - Form of Liquidity Commitment Agreement
EXHIBIT G - Form of U.S. Tax Compliance Certificate
ANNEXES
ANNEX A - Definitions
ANNEX B - Disclosure Materials
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<PAGE> 9
LIQUIDITY AGREEMENT
THIS LIQUIDITY AGREEMENT, dated as of March 4, 1998 (as amended,
supplemented, restated or otherwise modified from time to time, this "Liquidity
Agreement"), among DOLLAR THRIFTY FUNDING CORP., an Oklahoma corporation
("DTFC"), the financial institutions listed on the signature pages hereof under
the heading "Liquidity Lenders" (each such financial institution, together with
each of the financial institutions that has become party hereto pursuant to
Section 11.11.1, including any such financial institution acting in the capacity
of Swing Line Lender, being a "Liquidity Lender" and, collectively, the
"Liquidity Lenders") and CREDIT SUISSE FIRST BOSTON, a Swiss banking corporation
("CSFB"), as liquidity agent (in such capacity, together with any successors and
assigns thereto, the "Liquidity Agent") for the Liquidity Lenders.
W I T N E S S E T H:
WHEREAS, DTFC proposes to issue and sell its Commercial Paper Notes
(such capitalized term and the other capitalized terms used herein shall have
the meanings assigned thereto pursuant to Section 1.1 hereof) in the commercial
paper market and use the net proceeds thereof to, among other things, make
advances under the Series 1998-1 Notes issued by Rental Car Finance Corp., an
Oklahoma corporation ("RCFC"), pursuant to the Base Indenture (as the same may
be amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Base Indenture"), dated as of December 13, 1995,
between RCFC and Bankers Trust Company, a New York banking corporation, as
trustee and enhancement agent (the "Trustee"), as amended by Amendment to Base
Indenture, dated as of December 23, 1997, between RCFC and the Trustee, as
supplemented by the Series 1998-1 Supplement thereto (as amended, supplemented
or otherwise modified from time to time in accordance with the terms thereof,
the "Series 1998-1 Supplement") dated as of March 4, 1998, between RCFC and the
Trustee;
WHEREAS, the proceeds of advances made by DTFC under the Series 1998-1
Notes will be used by RCFC to acquire, finance or refinance Group II Vehicles
for leasing to Thrifty Rent-A-Car System, Inc., an Oklahoma corporation
("Thrifty"), Dollar Rent A Car Systems, Inc., an Oklahoma corporation
("Dollar"), and certain direct and indirect Subsidiaries of Dollar Thrifty
Automotive Group, Inc., a Delaware corporation ("DTAG") (Thrifty, Dollar and
such Subsidiaries, each a "Lessee" and, collectively, the "Lessees") under the
Master Motor Vehicle Lease and Servicing Agreement (as amended, supplemented or
otherwise
<PAGE> 10
modified from time to time in accordance with the terms thereof, the "Master
Lease"), dated as of March 4, 1998, among RCFC, as lessor, the Lessees, as
lessees and servicers, and DTAG, as guarantor and master servicer;
WHEREAS, DTFC desires to obtain Liquidity Commitments from the
Liquidity Lenders to make Liquidity Advances from time to time prior to the
Liquidity Commitment Termination Date in an aggregate principal amount not to
exceed the Aggregate Liquidity Commitment at any one time outstanding; and
WHEREAS, the Liquidity Lenders are willing, on the terms and subject to
the conditions hereinafter set forth (including Section 6.3), to provide such
Liquidity Commitments and make such Liquidity Advances to DTFC;
NOW, THEREFORE, in consideration of the foregoing premises, and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties hereto, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Definitions. Certain capitalized terms used herein
(including the preamble and the recitals hereto) shall have the meanings
assigned to such terms in the Definitions List, dated as of March 4, 1998 and
annexed hereto as Annex A, as such Definitions List may be amended, supplemented
or otherwise modified from time to time in accordance with the provisions hereof
(the "Definitions List"). Capitalized terms used herein but not defined herein
or in the Definitions List shall have the meanings assigned to such terms in
Definitions List attached as Schedule I to the Base Indenture and the Series
1998-1 Supplement, provided that any capitalized term used herein but not
defined herein or in the Definitions List but defined in both the Definitions
List attached as Schedule I to the Base Indenture and the Series 1998-1
Supplement shall have the meaning assigned to such term in the Series 1998-1
Supplement .
SECTION 1.2. Cross-References. Unless otherwise specified, references
in this Liquidity Agreement and in each other CP Program Document to any Article
or Section are references to such Article or Section of this Liquidity Agreement
or such other CP Program Document, as the case may be, and, unless otherwise
specified, references in any Article, Section or definition to any clause are
references to such clause of such Article, Section or definition.
-2-
<PAGE> 11
SECTION 1.3. Accounting and Financial Determinations; No Duplication.
Unless otherwise specified, (i) all accounting terms used herein shall be
interpreted, all accounting determinations and computations hereunder shall be
made, and all Financial Statements required to be delivered hereunder shall be
prepared in conformity with GAAP, and (ii) all accounting determinations and
computations hereunder or under any other CP Program Documents shall be made
without duplication; provided, that if any change in GAAP in itself materially
affects any such determination, computation or financial statement, DTFC may by
notice to the Liquidity Agent and the Collateral Agent, or alternatively the
Liquidity Agent or the Collateral Agent may by notice to DTFC, require that any
such determination, computation or financial statement thereafter be made in
accordance with GAAP as in effect, and applied by DTFC, immediately before such
change in GAAP occurs. Each of the Liquidity Agent and DTFC agrees to enter into
negotiations in good faith to modify the financial representations and covenants
and other applicable provisions contained herein in a manner which reflects any
such change in GAAP without adversely affecting the rights of the Liquidity
Agent and the Liquidity Lenders. .
ARTICLE II
COMMERCIAL PAPER OPERATIONS
SECTION 2.1. Issuance of Commercial Paper Notes. On the terms and
subject to the provisions of this Liquidity Agreement and the other CP Program
Documents, DTFC may from time to time on or after the Closing Date and prior to
the Liquidity Commitment Termination Date, issue and sell Commercial Paper
Notes; provided, however, that DTFC shall not issue and sell Commercial Paper
Notes if
(a) DTFC and the Depositary have received instructions then in
effect from the Liquidity Agent (copies of which will also be sent to
the Dealers), given in accordance with this Section 2.1, not to issue
or deliver Commercial Paper Notes because (i) the Liquidity Commitment
Termination Date shall have occurred, or (ii) the Commercial Paper
Account or any funds on deposit in, or otherwise to the credit of, the
Commercial Paper Account shall be subject to any stay, writ, judgment,
warrant of attachment, execution or similar process; provided, however,
that if any such stay, writ, judgment, warrant of attachment, execution
or similar process is removed or dismissed, DTFC may recommence the
issuance and sale of Commercial Paper Notes,
(b) the issuance of Commercial Paper Notes is prohibited by
Sections 2.1, 2.2, 9.2 or 9.4 hereof, Sections 3 or 10 of the
Depositary Agreement or Section 5.01 of the Collateral Agreement,
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<PAGE> 12
(c) after giving effect to such issuance and the use of
proceeds thereof, Aggregate Outstandings would exceed the CP Borrowing
Base,
(d) after giving effect to such issuance and the use of
proceeds thereof, the weighted average interest rate of the Outstanding
Commercial Paper Notes, Liquidity Advances and LOC Liquidity
Disbursements would be in excess of 10.00% per annum, unless (i) DTFC
and the Liquidity Agent shall have given their written consent to a
weighted average interest rate in excess of 10.00% per annum, (ii) the
Enhancement Amount shall be increased if required by the Rating
Agencies in connection therewith and (iii) the Rating Agencies shall
have confirmed that such weighted average interest rate will not result
in the downgrading or withdrawal of the then current ratings of the
Commercial Paper Notes; provided, however, that if the ratings of the
Commercial Paper Notes by S&P, Moody's, and DCR will be less than A-1,
P-1, and D-1 respectively, after giving effect to such weighted average
interest rate in excess of 10.00% per annum, such Commercial Paper
Notes will not be issued unless the Majority Banks shall have given
their written consent thereto, or
(e) DTFC and the Depositary shall have received instructions
then in effect from the Liquidity Agent not to issue or deliver
Commercial Paper Notes because any of the conditions set forth in
clauses (b) through (d) of this Section 2.1 shall be true.
The Liquidity Agent shall have no obligation to deliver any instructions set
forth in clause (a) or clause (e) of this Section 2.1 except upon the
instructions of the Majority Banks and any delivery by the Liquidity Agent of
any such instructions shall be subject to the provisions of Section 10.3 and the
rights of the Liquidity Agent hereunder and shall not relieve DTFC, the
Collateral Agent or the Depositary of any of their respective obligations under
any CP Program Document or with respect to the issuance of Commercial Paper
Notes. Any instructions from the Liquidity Agent to DTFC and the Depositary in
accordance with clause (a) or clause (e) of this Section 2.1 shall specify the
reason(s) to cease issuing and delivering Commercial Paper Notes. Without prior
instruction as set forth above, the Liquidity Agent agrees that it shall only
instruct DTFC and the Depositary not to issue and sell Commercial Paper Notes if
there shall have occurred an event described in subclause (i) of clause (a) of
this Section 2.1. Concurrently with the giving of any such instructions to DTFC
and the Depositary, the Liquidity Agent shall give notice thereof to the
Liquidity Lenders, the Collateral Agent, the Dealers, and the Rating Agencies,
but failure to do so shall not impair the effect of such instructions and the
giving of such notice shall be subject to Section 10.3.
SECTION 2.2. Conditions to the Issuance of Commercial Paper Notes. The
right of DTFC to issue Commercial Paper Notes (whether such Commercial Paper
Notes are to be issued to refinance Commercial Paper Notes maturing on the day
such Commercial Paper Notes are to be issued or to increase the Aggregate Face
Amount over that of the preceding day) is subject to the satisfaction of the
following conditions:
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SECTION 2.2.1. Representations and Warranties. With respect to the
issuance of any Commercial Paper Note and after giving effect thereto, the
representations and warranties of DTFC set forth in Article VII hereof, or in
any other CP Program Document to which DTFC is a party, shall be true and
correct (in all material respects to the extent any such representations and
warranties do not incorporate a materiality limitation in their terms) with the
same effect as if then made (unless stated to relate solely to an earlier date,
in which case such representations and warranties shall be true and correct (in
all material respects to the extent any such representations and warranties do
not incorporate a materiality limitation in their terms) as of such earlier
date.
SECTION 2.2.2. No Liquidity Agreement Amortization Event. (a) At the
time of such issuance and after giving effect thereto, no Liquidity Agreement
Amortization Event (and no Potential Liquidity Agreement Amortization Event with
respect to DTFC under Section 9.1.6 and, in the case of any increase in the
Aggregate Face Amount over that of the day preceding the day of such issuance,
no other Potential Liquidity Agreement Amortization Event) shall have occurred
and be continuing.
(b) Such issuance of Commercial Paper Notes shall not be prohibited by
Section 9.4.
SECTION 2.2.3. Available Liquidity Commitment. At the time of the
issuance of each Commercial Paper Note and after giving effect thereto and to
the use of proceeds thereof on such day, (a) the sum of (i) the Aggregate
Liquidity Commitment and (ii) the Series 1998-1 Letter of Credit shall be equal
to or greater than (b) the sum of (i) the Aggregate Outstanding CP and (ii) the
aggregate principal amount of Liquidity Advances Outstanding net of any amounts
on deposit at such time in the Collateral Account set aside for the repayment of
the principal of Liquidity Advances.
SECTION 2.2.4. No CP Borrowing Base Deficiency. With respect to the
issuance of any Commercial Paper Note, a CP Borrowing Base Deficiency shall not
exist and the issuance of such Commercial Paper Note, after giving effect to the
repayment of any Commercial Paper Notes, Liquidity Advances and LOC Liquidity
Disbursements made with the proceeds thereof, would not result in a CP Borrowing
Base Deficiency.
SECTION 2.2.5. CP Borrowing Base Certificate. The Liquidity Agent shall
have received an Officer's Certificate, dated the date of such issuance, duly
executed and delivered by an Authorized Officer of DTFC, certifying the amount
of the CP Borrowing Base as of the close of business on the last day of the
calendar month immediately preceding such date of issuance.
SECTION 2.2.6. Non-Payment of Series 1998-1 Notes. At the time of such
issuance and after giving effect thereto, no Amortization Event or Potential
Amortization Event under
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Section 8.1 of the Base Indenture or Lease Event of Default under Section 17.1
of the Master Lease shall have occurred and be continuing.
SECTION 2.3. Commercial Paper Notes. DTFC agrees that each promissory
note constituting a Commercial Paper Note shall (a) be substantially in the form
of Exhibit A to the Depositary Agreement or substantially in the form of the
Master Note attached as Exhibit E to the Depositary Agreement, and be completed
in accordance with this Liquidity Agreement and the Depositary Agreement
(including any provisions for book-entry securities contained therein), (b) be
dated the date of issuance thereof, (c) be made payable to the order of a named
payee or bearer, (d) have a maturity date which shall not be later than the
earlier of (i) the third Business Day prior to the earliest of the Scheduled
Liquidity Commitment Termination Date and the Series 1998-1 Letter of Credit
Expiration Date in effect on the date of issuance thereof and (ii) the date
which is 58 days after the date of issuance thereof, (e) be in a face amount of
at least $100,000 and an integral multiple of $1,000, and (f) be exempt from the
registration requirements of the Securities Act of 1933, as amended, pursuant to
Section 3(a)(3) thereof. Subject to the provisions of the Depositary Agreement,
all Commercial Paper Notes shall be delivered and issued against payment
therefor in immediately available funds on the date of issuance, and otherwise
in accordance with the terms of this Liquidity Agreement and the Depositary
Agreement.
SECTION 2.4. Commercial Paper Account; Payment of Commercial Paper
Notes. (a) Contemporaneously with the execution and delivery by DTFC of the
Depositary Agreement, and for the purposes of this Liquidity Agreement and the
Depositary Agreement, DTFC shall cause the Depositary to establish at its office
at 4 Albany Street, New York, New York 10006, a segregated trust account in its
corporate trust department for the exclusive benefit of the Holders of the
outstanding Commercial Paper Notes (the "Commercial Paper Account"), over which
the Depositary shall have exclusive control and sole right of withdrawal.
(b) Proceeds of the sale of Commercial Paper Notes shall be deposited
in the Commercial Paper Account only to the extent necessary to pay matured and
concurrently maturing Commercial Paper Notes, whether or not presented to the
Depositary for payment; otherwise, proceeds of the sale of Commercial Paper
Notes shall be applied according to the terms of the Collateral Agreement.
SECTION 2.5. Series 1998-1 Pledge Account. DTFC from time to time may
deposit funds of DTFC into the Series 1998-1 Pledge Account to be held by the
Collateral Agent as additional security for the payment and performance of
DTFC's Obligations to the Secured Parties. If on any date a Borrowing Base
Deficiency or CP Borrowing Base Deficiency continues to exist after application
of all Deposited Funds required to be applied on such date from the Collateral
Account, the Termination Advance Account and the Liquidity Lender Account
pursuant to Section 2.01 or 5.02 of the Collateral Agreement, as applicable,
then
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amounts on deposit in the Series 1998-1 Pledge Account shall be applied to make
payments on such date, in accordance with the penultimate paragraph of Section
5.01 of the Collateral Agreement, to the extent necessary to reduce such
Borrowing Base Deficiency or CP Borrowing Base Deficiency to zero.
ARTICLE III
LIQUIDITY COMMITMENTS, BORROWING PROCEDURES,
LIQUIDITY ADVANCES AND NOTES
SECTION 3.1. Liquidity Commitments. Subject to and in accordance with
the terms and the conditions of this Liquidity Agreement (including Article VI),
each Liquidity Lender severally and not jointly agrees to make Refunding
Advances, and the Swing Line Lender agrees to make Swing Line Advances to DTFC
pursuant to this Section 3.1.
SECTION 3.1.1. Refunding Advance Commitment. Subject to and in
accordance with the terms and conditions hereof (including, without limitation,
the terms and conditions set forth in Section 6.3), each Liquidity Lender
severally and not jointly agrees to make, from time to time, on or before such
Liquidity Lender's Liquidity Commitment Termination Date, advances for the
purposes set forth in Section 3.1.3 (relative to such Liquidity Lender
(including its Commitment Termination Date Liquidity Advance), its "Refunding
Advances") to DTFC equal to (a) in the case of Refunding Advances (other than
any Commitment Termination Date Liquidity Advance), such Liquidity Lender's
Percentage of the aggregate amount of the Borrowing of Refunding Advances
requested by DTFC or the Collateral Agent, as attorney-in-fact for DTFC, to be
made on such day, and (b) in the case of Commitment Termination Date Liquidity
Advances, such Liquidity Lender's Overall Percentage of the Aggregate Face
Amount on the date of such Commitment Termination Date Liquidity Advance. On the
terms and subject to the conditions hereof, DTFC may from time to time borrow,
prepay and reborrow Refunding Advances (other than Commitment Termination Date
Liquidity Advances).
SECTION 3.1.2. Swing Line Commitment. Subject to and in accordance with
the terms and conditions hereof (including, without limitation, the terms and
conditions set forth in Section 6.3), the Swing Line Lender agrees to make, from
time to time, on or before such Liquidity Lender's Liquidity Commitment
Termination Date, Swing Line Advances equal to the aggregate amount of Swing
Line Advances requested by DTFC or the Collateral Agent, as attorney-in-fact for
DTFC, to be made on such day. On the terms and subject to the conditions hereof,
DTFC may from time to time borrow, prepay and reborrow Swing Line Advances.
SECTION 3.1.3. Use of Proceeds. Proceeds of each Refunding Advance and
each Swing Line Advance shall be deposited by DTFC into the Commercial Paper
Account and
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proceeds of each Commitment Termination Date Liquidity Advance shall be
deposited by DTFC into the Termination Advance Account, in each case, for the
repayment of maturing Commercial Paper Notes or to repay matured Liquidity
Advances. DTFC shall not use the proceeds of any Liquidity Advance for any other
purpose.
SECTION 3.2. Liquidity Lenders Not Required to Make Certain Liquidity
Advances.
SECTION 3.2.1. Liquidity Advances. No Liquidity Lender shall be
required to make a Liquidity Advance to the extent that after giving effect to
such Liquidity Advance (i) the aggregate principal amount of all Liquidity
Advances (including any Swing Line Advances) Outstanding would exceed the
Aggregate Liquidity Commitment or (ii) the aggregate principal amount of such
Liquidity Lender's Liquidity Advances (including, in the case of the Swing Line
Lender, any Swing Line Advances) Outstanding would exceed such Liquidity
Lender's Liquidity Commitment.
SECTION 3.2.2. Failure To Fund. The provisions of this Section 3.2.2
shall only be operative at any time when the number of Liquidity Lenders whose
respective Liquidity Commitments have not expired or been terminated and the
Series 1998-1 Letter of Credit Provider shall exceed one (1) in the aggregate.
Subject to Section 3.2.1, in the event that one or more Liquidity Lenders fails
to fund its or their Percentage of the Liquidity Advances to be provided by the
Liquidity Lenders by 3:00 p.m., New York City time, on any Business Day (other
than a Commitment Termination Date Liquidity Advance or a Liquidity Advance the
proceeds of which are to be used to repay maturing Liquidity Advances), the
Liquidity Agent shall notify each of the other Liquidity Lenders not later than
4:00 p.m., New York City time, on such Business Day and each of the other
Liquidity Lenders shall, before 5:00 p.m., New York City time, on such Business
Day, make available to the Liquidity Agent at the Liquidity Agent's address
specified for such purpose, in immediately available funds, a Liquidity Advance
in a principal amount equal to such unfunded amount multiplied by a fraction,
the numerator of which is the Liquidity Commitment of such Liquidity Lender and
the denominator of which is the Aggregate Liquidity Commitment (less the
Liquidity Commitments of the defaulting Liquidity Lenders). After the Liquidity
Agent's receipt of such funds and upon fulfillment of the applicable conditions
set forth in Article VI, the Liquidity Agent will make such funds available to
DTFC by 5:30 p.m., New York City time. Any Liquidity Advance made pursuant to
this Section 3.2.2 shall be a Base Rate Advance subject to conversion in
accordance with the provisions of Section 3.8 hereof.
SECTION 3.3. Termination and Reduction of the Liquidity Commitments.
(a) DTFC may, upon at least three Business Days' prior written notice to the
Liquidity Agent bearing the signatures of two (2) Authorized Officers of DTFC
(who shall give prompt written notice thereof to each Liquidity Lender, the
Dealers and the Depositary), irrevocably terminate or reduce in part the
Aggregate Liquidity Commitment; provided, however, that the Aggregate Liquidity
Commitment shall not be reduced on any day in an amount such that the Aggregate
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Liquidity Commitment would be less than the sum of (i)(x) the Aggregate
Outstanding CP on such day, less (y) the Series 1998-1 Letter of Credit Amount,
plus (ii) the aggregate principal amount of all Liquidity Advances (including
any Swing Line Advances) Outstanding (other than Commitment Termination Date
Liquidity Advances) on such day net of any amounts on deposit on such day in the
Collateral Account set aside for the repayment of the principal of Liquidity
Advances; provided, further, that any partial reduction shall be at least
$5,000,000 with respect to the first reduction and in an integral multiple of
$1,000,000 thereafter. Any such reduction of the Aggregate Liquidity Commitment
shall reduce ratably the Liquidity Commitment of each Liquidity Lender.
(b) The Liquidity Agent shall give notice to the Dealers as to any
change in the Aggregate Liquidity Commitment promptly after any reduction
thereof.
(c) No termination or reduction of the Aggregate Liquidity Commitment
by DTFC pursuant to this Section 3.3 shall be effective unless the Liquidity
Agent or DTFC shall have given notice to S&P, Moody's and DCR of such
termination or reduction.
SECTION 3.4. Increase of the Aggregate Liquidity Commitment. The
Aggregate Liquidity Commitment may be increased from time to time to an amount
greater than the amount of the Aggregate Liquidity Commitment then in effect
through the increase of a Liquidity Lender's Liquidity Commitment or the
addition of one or more Eligible Liquidity Lenders as a party to this Liquidity
Agreement; provided, however, that no such increase shall become effective
unless all of the following conditions shall have been satisfied:
(a) DTFC and the Liquidity Agent shall have given their
written consent thereto;
(b) such Liquidity Lender or Eligible Liquidity Lender, as the
case may be, and DTFC shall have executed and delivered to the
Liquidity Agent a Liquidity Commitment Agreement;
(c) the Enhancement Amount shall be increased to the Minimum
Enhancement Amount that would be required by the increased Series
1998-1 Invested Amount resulting from the increase in the Aggregate
Liquidity Commitment;
(d) the conditions to making Advances under Section 2.01 of
the Note Purchase Agreement shall have been met; and
(e) the Rating Agencies confirm in writing that such increase
in the Aggregate Liquidity Commitment will not result in the
downgrading below the then current ratings or a withdrawal of the
ratings of the Commercial Paper Notes.
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SECTION 3.5. Extensions of Scheduled Liquidity Commitment Termination
Date. Each Liquidity Lender's Scheduled Liquidity Commitment Termination Date
may be extended from time to time by a written agreement among DTFC, such
Liquidity Lender and the Liquidity Agent.
SECTION 3.6. Borrowing Procedures. Borrowings of Refunding Advances,
Commitment Termination Date Liquidity Advances and Swing Line Advances shall be
made in accordance with this Section 3.6.
SECTION 3.6.1. Refunding Advances. (a) Upon receipt from DTFC of notice
(not later than 12:15 p.m., New York City time) pursuant to Section 5(b) of the
Depositary Agreement that, on any Business Day that any Commercial Paper Notes
mature, the amount required to pay in full all Commercial Paper Notes maturing
on such Business Day will be more than the net amount obtained by the issuance
of Commercial Paper Notes on such day plus the amount available for payment of
such Commercial Paper Notes in the Commercial Paper Account (the amount of such
excess, the "Commercial Paper Deficit"), the Collateral Agent shall, if such
notice contains an instruction from the Depositary to the Collateral Agent to
deliver a Borrowing Request, by delivering a Borrowing Request to the Liquidity
Agent (who will notify the other Liquidity Lenders of such Borrowing Request not
later than 2:00 p.m., New York City time) for a Borrowing consisting of
Refunding Advances, irrevocably request, not later than 12:30 p.m., New York
City time, on the date of a proposed Borrowing, that a Borrowing be made in an
aggregate principal amount equal to the excess, if any, of (A) the Commercial
Paper Deficit over (B) the sum of the aggregate amount, if any, applied or to be
applied on such Business Day to the Commercial Paper Deficit from amounts
available therefor in the Collateral Account and the Termination Advance Account
that are allocated to the payment of maturing Commercial Paper Notes and from
the proceeds of Swing Line Advances being made on such day. On the terms and
subject to the conditions of this Liquidity Agreement, each such Borrowing shall
be initially comprised of Base Rate Advances (subject to conversion in
accordance with the provisions of Section 3.8) and shall be made on the Business
Day specified in such Borrowing Request. For the purposes of this Section 3.6.1,
Commercial Paper Notes maturing on any day which have been paid with proceeds of
an advance made by the Depositary that has not been reimbursed shall nonetheless
be deemed to be unpaid.
(b) If on any Business Day in a Related Month the weighted average
interest rate of the Outstanding Commercial Paper Notes and Outstanding
Liquidity Advances exceeds 10% per annum, then DTFC shall notify the Liquidity
Agent thereof in writing no later than 11:00 a.m. (New York City time), that
unless the requirements for the continued issuance of Commercial Paper Notes set
forth in Section 2.1(d) shall have been complied with not later than 11:00 a.m.
(New York City time) on the last Business Day before the Payment Date with
respect to such Related Month, the Collateral Agent (provided DTFC shall have
delivered the notice specified above), shall, by delivering a Borrowing Request
to the Liquidity Agent (who will notify the
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other Liquidity Lenders of such Borrowing Request not later than 12:00 noon, New
York City time) for a Borrowing consisting of Refunding Advances, irrevocably
request, not later than 11:30 a.m., New York City time, on such last Business
Day before such Payment Date, that such Borrowing be made in an aggregate
principal amount equal to the lesser of (i) the Aggregate Liquidity Commitment
on such date minus the aggregate principal amount of all Liquidity Advances
(including any Swing Line Advances) Outstanding on such date as determined
immediately prior to such Borrowing Request and (ii) the Aggregate Outstanding
CP on such date.
SECTION 3.6.2. Swing Line Advances. If on any Business Day DTFC or the
Collateral Agent determines that there exists a Commercial Paper Deficit, the
excess of which Commercial Paper Deficit over the sum of the aggregate amount,
if any, applied or to be applied on such Business Day to the Commercial Paper
Deficit from amounts available therefor in the Collateral Account and the
Termination Advance Account that are allocated to the payment of maturing
Commercial Paper Notes is equal to or less than $5,000,000, DTFC or the
Collateral Agent, as the case may be, shall promptly (and in no case later than
12:00 noon New York City, New York time on the date of such discovery) notify
the Depositary of such Commercial Paper Deficit and DTFC or the Collateral
Agent, as attorney-in-fact for DTFC, may, or the Collateral Agent, upon the
instruction of the Depositary pursuant to Section 5(b) of the Depositary
Agreement, shall by delivering a Borrowing Request to the Liquidity Agent for
forwarding to the Swing Line Lender for a Borrowing consisting of a Swing Line
Advance, irrevocably request, not later than 12:30 p.m., New York City time, on
the date of a proposed Borrowing, that a Borrowing be made in an aggregate
principal amount equal to the least of
(a) $5,000,000 minus the aggregate principal amount of all
Swing Line Advances then Outstanding;
(b) the excess, if any, of the Swing Line Lender's Liquidity
Commitment as a Liquidity Lender over the aggregate principal amount of
all of its Liquidity Advances Outstanding on the date of such proposed
Borrowing (without giving effect to such proposed Borrowing); and
(c) the excess of the Commercial Paper Deficit over the sum of
the aggregate amount, if any, applied or to be applied on such Business
Day to the Commercial Paper Deficit from amounts available therefor in
the Collateral Account and the Termination Advance Account that are
allocated to the payment of maturing Commercial Paper Notes.
On the terms and subject to the conditions of this Liquidity Agreement, each
such Borrowing shall be a Base Rate Advance (subject to conversion in accordance
with the provisions of Section 3.8), and shall be made on the Business Day
specified in such Borrowing Request. For the purposes of this Section 3.6.2,
Commercial Paper Notes maturing on any day which
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have been paid with proceeds of an advance made by the Depositary that has not
been reimbursed shall nonetheless be deemed to be unpaid. If, after giving
effect to any Swing Line Advance requested pursuant to this Section 3.6.2, (a)
the aggregate principal amount of Swing Line Advances would be greater than
$5,000,000, or (b) the aggregate principal amount of Swing Line Advances is less
than or equal to $5,000,000 and such Swing Line Advances are not repaid within
five Business Days or (c) the aggregate principal amount of all Liquidity
Advances Outstanding made by the Swing Line Lender would exceed its Liquidity
Commitment, then in any such case, subject to Section 3.2.1, each Liquidity
Lender shall immediately and unconditionally, upon written notice thereof by the
Swing Line Lender, make a Refunding Advance to DTFC in an amount equal to such
Liquidity Lender's Percentage of the aggregate principal amount of the Swing
Line Advances Outstanding, the proceeds of which Refunding Advance will be
applied to the repayment of Swing Line Advances made by the Swing Line Lender.
Notwithstanding Section 6.3, the obligation of the Liquidity Lenders to make
Liquidity Advances under this Section 3.6.2 shall be unconditional. The Swing
Line Advances and Liquidity Advances made pursuant to this Section 3.6.2 shall
be comprised of Base Rate Advances, subject to conversion in accordance with the
provisions of Section 3.8 hereof.
SECTION 3.6.3. Commitment Termination Date Liquidity Advances. DTFC may
request each Liquidity Lender, on the Scheduled Liquidity Commitment Termination
Date with respect to such Liquidity Lender's Liquidity Commitment, to make a
Refunding Advance to DTFC on the terms and subject to the conditions of this
Liquidity Agreement. Any such Commitment Termination Date Liquidity Advance
shall not exceed such Liquidity Lender's Overall Percentage of the Aggregate
Face Amount on the date of such Commitment Termination Date Liquidity Advance
and the aggregate amount of any previously made Liquidity Advances of such
Liquidity Lender that are outstanding on such date shall be converted into, and
for all purposes of this Liquidity Agreement shall be treated as, a Commitment
Termination Date Liquidity Advance.
SECTION 3.6.4. Nature of Funding Obligations. The obligations of the
Liquidity Lenders hereunder are several and not joint. All Liquidity Advances
(other than Swing Line Advances and Commitment Termination Date Liquidity
Advances) under this Liquidity Agreement shall be made by the Liquidity Lenders
simultaneously and proportionately to their respective Percentages, it being
understood that, subject to Section 3.2.2, no Liquidity Lender shall be
responsible for any failure by any other Liquidity Lender to perform its
obligation to make a Liquidity Advance hereunder and that the Liquidity
Commitment of any Liquidity Lender shall not be increased or decreased as a
result of the failure by any other Liquidity Lender to perform its obligation to
make a Liquidity Advance. The failure of any Liquidity Lender to make available
to the Liquidity Agent its ratable share of any Borrowing shall not relieve any
other Liquidity Lender of its obligation hereunder to make available to the
Liquidity Agent such other Liquidity Lender's pro rata share of such Borrowing
on the date such funds are to be made available pursuant to the terms of this
Liquidity Agreement.
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Notwithstanding the foregoing, each Liquidity Lender shall continue to be
obligated to make Liquidity Advances upon a default by a Liquidity Lender as
required by Section 3.2.2.
SECTION 3.6.5. Failure to Fund by Liquidity Lender. Unless the
Liquidity Agent shall have been notified by any Liquidity Lender prior to 2:30
p.m., New York City time, on the date of any Borrowing in respect of any
Liquidity Advances that such Liquidity Lender does not intend to make available
to the Liquidity Agent such Liquidity Lender's Liquidity Advances on such date
of Borrowing, the Liquidity Agent may assume that such Liquidity Lender has made
such amount available to the Liquidity Agent on such date of Borrowing and the
Liquidity Agent in its sole discretion may, but shall not be obligated to, make
available to DTFC a corresponding amount on such date of Borrowing. If such
corresponding amount is not in fact made available to the Liquidity Agent by
such Liquidity Lender on or prior to a date of Borrowing, such Liquidity Lender
agrees to pay to the Liquidity Agent forthwith on demand such corresponding
amount together with interest thereon, and DTFC agrees to repay to the Liquidity
Agent (to the extent not paid by the defaulting Liquidity Lender) forthwith on
the Business Day immediately following the date of demand therefor such
corresponding amount together with interest thereon, for each day from the date
such amount is made available to DTFC until the date such amount is paid or
repaid to the Liquidity Agent, at (a) in the case of such Liquidity Lender, the
Federal Funds Rate for the first Business Day and thereafter at the Base Rate,
and (b) in the case of DTFC, the interest rate that would be applicable at the
time to a Borrowing of Base Rate Advances made on such date of Borrowing. If
such Liquidity Lender shall pay to the Liquidity Agent such corresponding
amount, such amount so paid shall constitute such Liquidity Lender's Liquidity
Advance, and if both such Liquidity Lender and DTFC shall have paid and repaid,
respectively, such corresponding amount, the Liquidity Agent shall promptly pay
over to DTFC such corresponding amount in same day funds, but DTFC shall remain
obligated for all interest thereon. To the extent any such amount due to the
Liquidity Agent under this Section 3.6.5 has not been paid in full, the
Liquidity Agent may make a demand on the Collateral Agent to pay such amount in
accordance with Sections 2.01 and 5.02(b) of the Collateral Agreement.
SECTION 3.7. Disbursement of Funds. (a) Upon receipt of each Borrowing
Request for Refunding Advances, the Liquidity Agent shall give to each Liquidity
Lender prompt notice thereof and of such Liquidity Lender's share of the
Borrowing requested thereby no later than 2:00 p.m., New York City time, on the
date of receipt. On or before 3:00 p.m., New York City time, on the date of the
proposed Borrowing, each Liquidity Lender shall deposit with the Liquidity Agent
same day funds in an amount equal to (i) such Liquidity Lender's Percentage of
the requested Borrowing (except in the case of a Commitment Termination Date
Liquidity Advance) or (ii) in the case of a Commitment Termination Date
Liquidity Advance, such Liquidity Lender's Overall Percentage of the Aggregate
Face Amount on the date of such Commitment Termination Date Liquidity Advance.
Such deposit will be made to a segregated trust account (Account No. 931454-31)
established by the Liquidity
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Agent or such other account which the Liquidity Agent shall specify from time to
time by notice to the Liquidity Lenders.
(b) Upon receipt of a Borrowing Request for a Swing Line Advance, the
Liquidity Agent shall give the Swing Line Lender prompt notice thereof and of
the amount of the Borrowing requested thereby. On or before 2:00 p.m., New York
City time, on the date of the proposed Borrowing, the Swing Line Lender shall
deposit with the Liquidity Agent same day funds in an amount equal to the
requested Borrowing. Such deposit shall be made to an account which the
Liquidity Agent shall specify from time to time by notice to the Swing Line
Lender.
(c) Unless the Liquidity Agent determines that any condition specified
in Section 6.3, in the case of Refunding Advances or Swing Line Advances, has
not been satisfied, the Liquidity Agent will remit the aggregate of the amounts
of (i) Refunding Advances or Swing Line Advances so made available by the
Liquidity Lenders (or, in the case of any Swing Line Advance, the Swing Line
Lender) to the Commercial Paper Account and (ii) Commitment Termination Date
Liquidity Advances so made available by the Liquidity Lenders to the Termination
Advance Account.
SECTION 3.8. Continuation and Conversion Elections. By delivering a
Continuation/ Conversion Notice to the Liquidity Agent (which will give prompt
notice to the Liquidity Lenders) on or before 11:15 a.m., New York City time, on
a Business Day, DTFC may from time to time irrevocably elect that all or any
portion in an aggregate minimum amount of $5,000,000 and an integral multiple of
$1,000,000 of any Liquidity Advances be
(a) in the case of Base Rate Advances, on not less than three
nor more than five Business Days' prior notice, converted into
Eurodollar Advances; or
(b) in the case of Eurodollar Advances, on prior notice given
not less than three nor more than five Business Days prior to the end
of the related Interest Period, continued as Eurodollar Advances.
In the absence of delivery of a Continuation/Conversion Notice at least three
Business Days prior to the last day of the related Interest Period, in the case
of any Eurodollar Advance, such Eurodollar Advance shall, on such last day,
automatically convert to a Base Rate Advance. In the absence of delivery of a
Continuation/Conversion Notice at least three Business Days prior to the last
day of the related Interest Period, in the case of any Base Rate Advance, such
Base Rate Advance shall automatically continue as a Base Rate Advance. No
portion of the principal amount of any Liquidity Advances Outstanding may be
continued as, or be converted into, Eurodollar Advances when any Liquidity
Agreement Amortization Event or Potential Liquidity Agreement Amortization Event
has occurred and is continuing.
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SECTION 3.9. Eurodollar Funding. (a) Each Liquidity Lender may, if it
so elects, fulfill its obligation to make, continue or convert Eurodollar
Advances hereunder by causing one of its foreign branches or Affiliates (or an
international banking facility created by such Liquidity Lender) to make or
maintain such Eurodollar Advance; provided, however, that such Eurodollar
Advance shall nonetheless be deemed to have been made and to be held by such
Liquidity Lender, and the obligation of DTFC to repay such Eurodollar Advance
shall nevertheless be to such Liquidity Lender for the account of such foreign
branch, Affiliate or international banking facility.
(b) DTFC shall not be permitted to request, and the Liquidity Lenders
shall not be required to maintain, any number of Interest Periods with respect
to Eurodollar Advances in effect at any time hereunder in excess of 20.
SECTION 3.10. Liquidity Advance Notes. Each Liquidity Lender's
Liquidity Advances (including its Refunding Advances and Commitment Termination
Date Liquidity Advance and, in the case of the Swing Line Lender, any Swing Line
Advances) under its Liquidity Commitment shall be evidenced by a Liquidity
Advance Note, duly executed on behalf of DTFC, and payable to the order of such
Liquidity Lender in a maximum principal amount equal in each case to such
Liquidity Lender's original Liquidity Commitment (which Liquidity Advance Note
shall, unless requested by such Liquidity Lender, be in substantially the form
of Exhibit A to this Liquidity Agreement and shall be held by the Liquidity
Agent on behalf of the Liquidity Lenders). DTFC hereby irrevocably authorizes
each Liquidity Lender to make (or cause to be made) appropriate notations on the
grid attached to such Liquidity Lender's Liquidity Advance Note (or on any
continuation of such grid), which notations, if made, shall evidence, inter
alia, the date of, the outstanding principal of, and the interest rate and
Interest Period applicable to, the Liquidity Advances evidenced thereby. Such
notations shall be conclusive and binding on DTFC absent manifest error;
provided, however, that the failure of any Liquidity Lender to make any such
notation or any error in any such notation shall not limit or otherwise affect
any Obligations of DTFC.
ARTICLE IV
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES, ETC.
SECTION 4.1. Repayments and Prepayments. DTFC shall repay in full the
unpaid principal amount of each Liquidity Advance on the earlier to occur of (i)
the Scheduled Maturity Date and (ii) the date all Obligations are declared or
otherwise become due and payable under Section 9.2. Prior thereto, DTFC shall
make repayments and prepayments in accordance with this Section 4.1.
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SECTION 4.1.1. Voluntary Prepayments. From time to time on any Business
Day, DTFC may make a voluntary prepayment, in whole or in part, of the
outstanding principal amount of any Liquidity Advance; provided, however, that
(a) DTFC shall, in the case of the voluntary prepayment of any
Eurodollar Advance, give the Liquidity Agent at least three but no more
than five Business Days' prior written notice (which notice shall be
irrevocable) of its intent to prepay such Eurodollar Advance and DTFC
shall specify in such prior written notice the amount of such
prepayment;
(b) all such voluntary prepayments which are partial
prepayments shall be in a minimum aggregate principal amount equal to
$1,000,000 and in an integral multiple of $100,000;
(c) all such voluntary prepayments shall be applied, unless
otherwise specified by DTFC, first, pro rata among Base Rate Advances
for the repayment thereof and then, pro rata among Eurodollar Advances
having the same Interest Period in the inverse order of their
maturities, for the repayment thereof; and
(d) no such voluntary prepayment of any Eurodollar Advance may
be made on any day other than the last day of the Interest Period for
such Eurodollar Advance unless, as required by Section 5.4, breakage
fees are paid in connection with such prepayment.
SECTION 4.1.2. Mandatory Prepayments. (a) Concurrently with any partial
reduction or termination of the Aggregate Liquidity Commitment pursuant to
Section 3.3, all funds available on such day in the Collateral Account for the
payment of Liquidity Advances, as provided in Section 2.01 or 5.02, as
applicable, of the Collateral Agreement, shall be applied to repay as much of
the Liquidity Advances (and interest accrued thereon) as shall be necessary so
that the sum of the aggregate principal amount of Liquidity Advances Outstanding
(other than Commitment Termination Date Liquidity Advances) plus the Aggregate
Face Amount will not exceed the Aggregate Liquidity Commitment plus the Series
1998-1 Letter of Credit after giving effect to such termination or reduction
and, to the extent such funds are not sufficient to pay such excess (and
interest accrued thereon), all funds subsequently deposited in the Collateral
Account and allocated to the payment of Liquidity Advances in accordance with
the priorities set forth in Section 2.01 or 5.02, as applicable, of the
Collateral Agreement shall be applied to pay such excess (and interest accrued
thereon) until so paid.
(b) If, on any Business Day, a Borrowing Base Deficiency or CP
Borrowing Base Deficiency, as applicable, exists, all funds available for the
payment of Commercial Paper Notes, Liquidity Advances or LOC Liquidity
Disbursements on such day in the Collateral Account, as provided in Section 2.01
or 5.02, as applicable, of the Collateral Agreement, shall
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be (i) first, deposited in the Commercial Paper Account for application to the
payment of maturing Commercial Paper Notes (and, in the case of deposits made
pursuant to Section 2.01 of the Collateral Agreement, unmatured Commercial Paper
Notes) and (ii) second, applied to repay Liquidity Advances and LOC Liquidity
Disbursements (and interest accrued thereon) pro rata in accordance with their
outstanding principal amount, in each case, as shall be necessary so that after
giving effect to such application there shall be no Borrowing Base Deficiency or
CP Borrowing Base Deficiency, as applicable, and, to the extent such funds or
other amounts are not sufficient therefor, all funds subsequently deposited in
the Collateral Account and allocated to the payment of Liquidity Advances and
LOC Liquidity Disbursements in accordance with the priorities set forth in
Section 2.01 or 5.02, as applicable, of the Collateral Agreement shall be
applied or set aside for the pro rata application thereof to the payment of
Liquidity Advances Outstanding and LOC Liquidity Disbursements Outstanding until
there shall be no Borrowing Base Deficiency or CP Borrowing Base Deficiency, as
applicable.
(c) Each mandatory payment required by clause (a) (in the case of a
reduction or termination pursuant to Section 3.3) or clause (b) above shall, for
purposes of Section 9.1.1 and all other provisions of this Liquidity Agreement,
be due and payable in full on the Business Day on which such reduction or
termination or such Borrowing Base Deficiency or CP Borrowing Base Deficiency
exists, whether or not sufficient funds are then available to make such payment.
SECTION 4.2. Interest Provisions. Interest on the principal amount of
Liquidity Advances Outstanding shall accrue and be payable in accordance with
this Section 4.2.
SECTION 4.2.1. Rates. (a) Pursuant to an appropriately delivered
Borrowing Request or Continuation/Conversion Notice, DTFC may elect that
Liquidity Advances comprising a Borrowing accrue interest at a rate per annum:
(i) on that portion maintained from time to time as a Base
Rate Advance, equal to the Base Rate from time to time in effect; or
(ii) on that portion maintained as a Eurodollar Advance,
during each Interest Period applicable thereto, equal to the Eurodollar
Rate (Reserve Adjusted) for such Interest Period.
(b) If any Liquidity Lender shall determine in good faith that reserves
under Regulation D of the Board of Governors of the Federal Reserve System
("Regulation D") are required to be maintained by it in respect of, or that a
portion of its costs of maintaining reserves under Regulation D is properly
attributable to, one or more of its Eurodollar Advances, DTFC shall pay to such
Liquidity Lender additional interest on the unpaid principal amount of each such
Eurodollar Advance from the date such reserves were required to be maintained
until such principal amount is paid in full or converted into a Base Rate
Advance,
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at an interest rate per annum equal at all times to the remainder obtained by
subtracting (i) the Eurodollar Rate for the Interest Period for such Eurodollar
Advance from (ii) the rate obtained by dividing such Eurodollar Rate by an
amount equal to one minus the Eurodollar Reserve Percentage (expressed as a
decimal) of such Liquidity Lender for such Eurodollar Interest Period. Any
Liquidity Lender claiming any additional interest payable pursuant to this
clause (b) shall provide a written certificate to the Liquidity Agent, DTFC and
the Rating Agencies setting forth the amount of such additional interest and
reasonable detail as to the calculation thereof. DTFC shall pay such Liquidity
Lender the amount shown as due on any such certificate within 30 days following
the date on which such certificate was delivered to DTFC.
SECTION 4.2.2. Post Default Rates. Without giving effect to Section
5.10 hereof, after the date on which any amount of any Liquidity Advance is due
and payable (whether on the last day of an Interest Period, on the Scheduled
Maturity Date, when a mandatory prepayment initially becomes due or upon
acceleration or otherwise), or after any other monetary Obligation of DTFC shall
have become due and payable, DTFC shall pay, but only to the extent permitted by
law, interest (after as well as before judgment) on the principal amount of
Liquidity Advances then Outstanding (whether or not the same shall then be due
and payable) and each other monetary Obligation hereunder (but only if the same
shall then be due and payable in accordance with the terms of this Liquidity
Agreement) at a rate per annum equal to a margin of 2% per annum plus (i) in the
case of any Liquidity Advances then Outstanding and in respect of which Interest
Periods remain in effect, the respective interest rates then applicable to such
Liquidity Advances, and (ii) in all other cases, a rate per annum equal to the
rate per annum that would then be in effect with respect to a Base Rate Advance.
SECTION 4.3. Payments of Interest. Accrued interest in respect of each
Liquidity Advance shall be payable in arrears (whether by acceleration, demand
or otherwise) on each payment date set forth below:
(a) with respect to any Base Rate Advance, on the last
Business Day of each calendar quarter, beginning with the first such
date to occur after such Base Rate Advance is made;
(b) with respect to any Eurodollar Advance, on the last day of
each applicable Interest Period (and, if such Interest Period shall
exceed three months, on the three-month anniversary of the commencement
of such Interest Period);
(c) in the case of any payment or prepayment, in whole or in
part, of principal outstanding on any Liquidity Advance, on the amount
and on the date of such payment or prepayment;
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(d) with respect to any Base Rate Advance converted into a
Eurodollar Advance on a day when interest would not otherwise have been
payable pursuant to clause (a), on the date of such conversion; and
(e) on that portion of any Liquidity Advance which is
accelerated pursuant to Section 9.2, immediately upon such
acceleration.
Interest accrued on Liquidity Advances or other monetary Obligations arising
under this Liquidity Agreement or any other CP Program Document after the date
such amount is due and payable shall be payable upon demand.
SECTION 4.4. (a) Computation Basis. Interest accruing based on the Base
Rate shall be computed on the basis of the actual number of days elapsed and a
365 (or, if applicable, 366) day year. Interest accruing based on the Eurodollar
Rate (Reserve Adjusted) shall be computed on the basis of the actual number of
days elapsed and a 360 day year.
(b) Determination of Rates. The Liquidity Agent shall notify the
Trustee, DTAG, in its capacity as Master Servicer under the Master Lease, and
DTFC, in writing on or prior to each Determination Date regarding the Series
1998-1 Note Rate, Base Rate, CP Rate and Eurodollar Rate for the related
Interest Period.
SECTION 4.5. Fees. (a) Commitment Fee. DTFC agrees to pay to the
Liquidity Agent for the account of each Liquidity Lender an ongoing commitment
fee (the "Commitment Fee") equal to 0.1875% per annum of the average daily
unused portion of each such Liquidity Lender's Liquidity Commitment, such fee to
accrue from the Closing Date until the Liquidity Commitment Termination Date.
The Commitment Fee shall be computed based on the actual number of days elapsed
and a 360 day year. The Commitment Fee shall be payable in arrears on the last
Business Day of each calendar quarter occurring after the Closing Date and on
the Liquidity Commitment Termination Date.
(b) Upfront Fee. DTFC agrees to pay to the Liquidity Agent for the
account of each Liquidity Lender, as applicable, an upfront fee (the "Upfront
Fee") as set forth in the Fee Letter, which shall be payable immediately upon
the Closing Date. In the event that (i) a Liquidity Lender's short-term credit
rating is reduced to below A-1 by S&P, below P-1 by Moody's or below D-1 by DCR
(if rated by DCR) prior to its initial Liquidity Commitment Termination Date,
and (ii) DTFC elects to replace such Liquidity Lender pursuant to the terms of
this Liquidity Agreement, then such Liquidity Lender shall reimburse DTFC for an
amount equal to the unearned portion of the Upfront Fee actually received by
such Liquidity Lender (based on the remaining period from the date of such
replacement to such Liquidity Lender's Scheduled Commitment Termination Date).
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ARTICLE V
CERTAIN EURODOLLAR AND OTHER PROVISIONS
SECTION 5.1. Eurodollar Lending Unlawful. If any Liquidity Lender shall
reasonably determine (which determination shall, upon notice thereof to DTFC and
the other Liquidity Lenders, be conclusive and binding on DTFC) that the
introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or any central bank or other Governmental
Authority asserts that it is unlawful, for such Liquidity Lender to make,
continue or maintain any Liquidity Advance as, or to convert any Liquidity
Advance into, a Eurodollar Advance, the obligation of such Liquidity Lender to
make, continue or maintain or convert any such Liquidity Advance as a Eurodollar
Advance shall, upon such determination, forthwith be suspended until such
Liquidity Lender shall notify the Liquidity Agent and DTFC that the
circumstances causing such suspension no longer exist, and DTFC shall
immediately convert (in the manner provided for in Section 3.8) all Eurodollar
Advances of such Liquidity Lender into Base Rate Advances at the end of the then
current Interest Periods with respect thereto or sooner, if required by such law
or assertion.
SECTION 5.2. Deposits Unavailable. If the Liquidity Agent shall have
reasonably determined that
(a) Eurodollar deposits in the relevant amount and for the
relevant Interest Period are not available to all Reference Lenders in
the relevant market; or
(b) by reason of circumstances affecting all Reference
Lenders' relevant market, adequate means do not exist for ascertaining
the interest rate applicable hereunder to Eurodollar Advances; or
(c) the Majority Banks have notified the Liquidity Agent that,
with respect to any interest rate otherwise applicable hereunder to any
Eurodollar Advances the Interest Period for which has not then
commenced, such interest rate will not adequately reflect the cost to
such Majority Banks of making, funding or maintaining their respective
Eurodollar Advances for such Interest Period,
then, upon notice from the Liquidity Agent to DTFC and the Liquidity Lenders,
the obligations of all Liquidity Lenders under Section 3.6 and Section 3.8 to
make or continue any Liquidity Advance as, or to convert any Liquidity Advances
into, Eurodollar Advances shall forthwith be suspended until the Liquidity Agent
shall notify DTFC and the Liquidity Lenders that the circumstances causing such
suspension no longer exist.
SECTION 5.3. Increased Costs, etc. DTFC agrees to reimburse each
Liquidity Lender for any increase in the cost to such Liquidity Lender of, or
any reduction in the amount
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of any sum receivable by such Liquidity Lender in respect of, making, continuing
or maintaining (or of its obligation to make, continue or maintain) any
Liquidity Advances as, or of converting (or of its obligation to convert) any
Liquidity Advances into, Eurodollar Advances that arise in connection with any
change in, or the introduction, adoption, effectiveness, interpretation
reinterpretation or phase-in after the date hereof of, any law or regulation,
directive, guideline, decision or request (whether or not having the force of
law) of any court, central bank, regulator or other Governmental Authority,
except for such changes with respect to (i) increased capital costs which are
governed by Section 5.5, (ii) Taxes governed by Section 5.6 (including taxes
imposed by reason of any failure of such Liquidity Lender to comply with its
obligations under clause (b) of Section 5.6) and (iii) taxes imposed by a taxing
authority on or measured by the net income, overall receipts or capital of such
Liquidity Lender or any lending office, branch or any Affiliate thereof and any
franchise taxes or branch taxes imposed by a taxing authority on such Liquidity
Lender or any lending office, branch or any Affiliate thereof; provided,
however, that DTFC shall have no obligation to pay any such additional amount
under this Section 5.3 with respect to any such change unless such Liquidity
Lender shall have notified DTFC of its demand within 90 days after the date upon
which such Liquidity Lender has obtained audited financial statements with
respect to the fiscal year of such Liquidity Lender in which such change
occurred. Such Liquidity Lender shall promptly notify the Liquidity Agent and
DTFC in writing of the occurrence of any such reduction or increase (but in no
event later than the date by which such Liquidity Lender may demand
reimbursement therefor pursuant to the immediately preceding sentence), such
notice to state, in reasonable detail, the reasons therefor and the additional
amount required fully to compensate such Liquidity Lender on an after-tax basis
for such increased cost or reduced amount. Such additional amounts shall be
payable by DTFC directly to such Liquidity Lender within five Business Days of
its receipt of such notice, and such notice shall, in the absence of manifest
error, be conclusive and binding on DTFC.
SECTION 5.4. Funding Losses. In the event any Liquidity Lender shall
incur any loss or expense (including any loss or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Liquidity Lender to make, continue or maintain any portion of the principal
amount of any Liquidity Advance as, or to convert any portion of the principal
amount of any Liquidity Advance into, a Eurodollar Advance) as a result of
(a) any conversion or repayment or prepayment of the principal
amount of any Eurodollar Advance on a date other than the scheduled
last day of the Interest Period applicable thereto, whether pursuant to
Section 4.1 or otherwise;
(b) any Liquidity Advances not being made as Eurodollar
Advances in accordance with the Borrowing Request therefor; or
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(c) any Liquidity Advances not being continued as, or
converted into, Eurodollar Advances in accordance with the
Continuation/Conversion Notice therefor,
then, upon the written notice of such Liquidity Lender to DTFC (with a copy to
the Liquidity Agent), DTFC shall, within five Business Days of its receipt
thereof, pay directly to such Liquidity Lender such amount as will (in the
reasonable determination of such Liquidity Lender) reimburse such Liquidity
Lender for such loss or expense. Such written notice (which shall include
calculations in reasonable detail) shall, in the absence of manifest error, be
conclusive and binding on DTFC.
SECTION 5.5. Increased Capital Costs. If any change in, or the
introduction, adoption, effectiveness, interpretation or reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any court, central bank, regulator
or other Governmental Authority affects or would affect the amount of capital
required or expected to be maintained by any Liquidity Lender or any Person
controlling such Liquidity Lender, and such Liquidity Lender determines (in its
sole and absolute discretion) that the rate of return on its or such controlling
Person's capital as a consequence of its Liquidity Commitment or the Liquidity
Advances made by such Liquidity Lender is reduced to a level below that which
such Liquidity Lender or such controlling Person could have achieved but for the
occurrence of any such circumstance, then, in any such case upon notice from
time to time by such Liquidity Lender to DTFC, DTFC shall pay directly to such
Liquidity Lender within five Business Days additional amounts sufficient to
compensate such Liquidity Lender or such controlling Person on an after-tax
basis for such reduction in rate of return; provided, however, that DTFC shall
have no obligation to pay any such additional amount under this Section 5.5 with
respect to any such change unless such Liquidity Lender shall have notified DTFC
of its demand within 90 days after the date upon which such Liquidity Lender or
controlling Person has obtained audited financial statements with respect to the
fiscal year of such Liquidity Lender or such controlling Person in which such
change occurred. Such Liquidity Lender or such controlling Person shall promptly
notify the Liquidity Agent and DTFC in writing of the occurrence of any such
reduction (but in no event later than the date by which such Liquidity Lender or
controlling Person may demand payment therefor pursuant to the immediately
preceding sentence). A statement of such Liquidity Lender as to any such
additional amount or amounts (including calculations thereof in reasonable
detail) shall, in the absence of manifest error, be conclusive and binding on
DTFC. In determining such amount, such Liquidity Lender may use any method of
averaging and attribution that it (in its sole and absolute discretion) shall
deem applicable.
SECTION 5.6. Taxes.
(a) Except to the extent otherwise provided in the proviso to
clause (iii) of this Section 5.6(a) and the proviso to the sentence
immediately succeeding such clause (iii), all payments by DTFC of
principal of, and interest on, the Liquidity Advances and all
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other amounts payable hereunder (including fees) shall be made free and
clear of and without deduction for any present or future income,
excise, stamp or franchise taxes and other taxes, fees, duties,
withholdings or other charges of any nature whatsoever imposed by any
taxing authority, but excluding (A) in the case of each Liquidity
Lender and the Liquidity Agent, taxes imposed on or measured by the net
income, overall receipts or capital of such Liquidity Lender (or any
lending office, branch or Affiliate of such Liquidity Lender) or the
Liquidity Agent and franchise taxes or branch taxes imposed on such
Liquidity Lender (or any lending office, branch or Affiliate of such
Liquidity Lender) or the Liquidity Agent, as the case may be, (x) by
the jurisdiction under the laws of which it is organized or any
political subdivision thereof or (y) by reason of any connection
between the jurisdiction imposing such tax and such Liquidity Lender
(or any lending office, branch or Affiliate thereof) or the Liquidity
Agent, as the case may be, other than a connection arising solely from
such Liquidity Lender (or such lending office, branch or Affiliate) or
the Liquidity Agent, as the case may be, having executed, delivered, or
performed its obligations under, or received payment under or enforced,
this Liquidity Agreement, any Liquidity Advance Notes or any other
Liquidity Document and, (B) in the case of each Liquidity Lender, taxes
imposed on or measured by the net income, overall receipts or capital
of such Liquidity Lender (or any lending office, branch or Affiliate of
such Liquidity Lender) and franchise taxes or branch taxes imposed on
such Liquidity Lender (or any lending office, branch or Affiliate of
such Liquidity Lender) by the jurisdiction in which such Liquidity
Lender's Domestic Office or Eurodollar Office, as the case may be, is
located or any political subdivision thereof (such non-excluded items
being called "Taxes"). In the event that any withholding or deduction
from any payment to be made by DTFC hereunder is required in respect of
any Taxes pursuant to any Applicable Law then DTFC will
(i) pay directly to the relevant authority the full
amount required to be so withheld or deducted;
(ii) promptly forward to the Liquidity Agent an
official receipt or other documentation satisfactory to the
Liquidity Agent evidencing such payment to such authority; and
(iii) pay to the Liquidity Agent for the account of
the Liquidity Lenders (or, if applicable, for its own account)
such additional amount or amounts as is necessary to ensure
that the net amount actually received by each Liquidity Lender
and the Liquidity Agent will equal the full amount such
Liquidity Lender or the Liquidity Agent, as the case may be,
would have received had no such withholding or deduction been
required; provided, however, that DTFC shall be entitled to
deduct and withhold any Taxes and shall not be required to
increase any such amounts payable pursuant to this clause
(iii) to the Liquidity Agent for the account of any Liquidity
Lender (or, if applicable, for its own account) to
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the extent such Taxes are imposed as a result of the failure
of such Liquidity Lender or, as applicable, the Liquidity
Agent to comply with the requirements of clause (b) of this
Section 5.6.
Moreover, if any Taxes are directly asserted against the Liquidity Agent or any
Liquidity Lender with respect to any payment received by the Liquidity Agent or
such Liquidity Lender hereunder, the Liquidity Agent or such Liquidity Lender
may pay such Taxes and promptly notify DTFC of the nature and amount of such
payment and DTFC will promptly pay such additional amounts (including any
penalties, interest or expenses) as is necessary in order that the net amount
received by such person after the payment of such Taxes (including any Taxes on
such additional amount) shall equal the amount such person would have received
had no such Taxes been asserted; provided, however, that DTFC shall not be
required to pay any additional amounts pursuant to this sentence to the
Liquidity Agent for the account of any Liquidity Lender (or, if applicable, for
its own account), or to any Liquidity Lender, to the extent such Taxes are
imposed as a result of the failure of such Liquidity Lender or, as applicable,
the Liquidity Agent to comply with the requirements of clause (b) of this
Section 5.6.
If DTFC fails to pay any Taxes when due to the appropriate taxing
authority or fails to remit to the Liquidity Agent, for the account of the
respective Liquidity Lenders, the required receipts or other required
documentary evidence, DTFC shall indemnify the Liquidity Lenders for any
incremental Taxes, interest or penalties that may become payable by any
Liquidity Lender as a result of any such failure. For purposes of this Section
5.6, a distribution hereunder by the Liquidity Agent or any Liquidity Lender to
or for the account of any Liquidity Lender shall be deemed a payment by DTFC.
(b) Each Liquidity Lender that is not incorporated under the
laws of the United States (or any State thereof or the District of
Columbia) and, if the Liquidity Agent is not incorporated under the
laws of the United States (or any State thereof or the District of
Columbia), the Liquidity Agent shall:
(X)(i) on or before the date of any payment by DTFC
under this Liquidity Agreement, any Liquidity Advance Notes or
any other Liquidity Document for the account of such Liquidity
Lender or the Liquidity Agent, deliver to DTFC and the
Liquidity Agent (A) two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, or successor
applicable form, as the case may be, and such other forms and
certifications as may reasonably be required under applicable
law, in order to establish that as of the date thereof such
Liquidity Lender or the Liquidity Agent, as the case may be,
is entitled to receive all payments under this Liquidity
Agreement, any Liquidity Advance Notes or any other Liquidity
Document without deduction or withholding of any United States
federal income taxes and (B) an Internal
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Revenue Service Form W-8 or W-9, or successor applicable form,
as the case may be, certifying that such Liquidity Lender or
the Liquidity Agent, as the case may be, is entitled to an
exemption from United States backup withholding taxes;
(ii) deliver to DTFC and the Liquidity Agent two
further copies of any such form on or before the date that any
such form expires or becomes obsolete and after the occurrence
of any event requiring a change in the most recent form
previously delivered by it to DTFC and the Liquidity Agent;
and
(iii) if necessary, obtain, at the expense of DTFC,
such extensions of time for delivery of such forms as may
reasonably be requested by DTFC; or
(Y) in the case of any such Liquidity Lender that is
not a "bank" within the meaning of Section 881(c)(3)(A) of the
Code, (i) furnish to DTFC on or before the date of any payment
by DTFC, with a copy to the Liquidity Agent, (A) a certificate
substantially in the form of Exhibit G (any such certificate a
"U.S. Tax Compliance Certificate"), (B) two accurate and
complete original signed copies of Internal Revenue Service
Form W-8, or successor applicable form certifying to such
Liquidity Lender's entitlement as of the date of such form to
the exemption under Section 881(c) of the Code from U.S.
withholding tax on payments of interest under this Liquidity
Agreement, any Liquidity Advance Notes or any other Liquidity
Document (and deliver to DTFC and the Liquidity Agent two
further copies of such form on or before the date the most
recently delivered form expires or becomes obsolete and after
the occurrence of any event requiring a change in the most
recently delivered form and, if necessary, obtain, at the
expense of DTFC, any extensions of time reasonably requested
by DTFC for the delivery of such forms), and (C) in the case
of a Liquidity Lender that is entitled to receive payments
under this Liquidity Agreement, any Liquidity Advance Notes or
any other Liquidity Documents other than payments of interest,
two accurate and complete original signed copies of Internal
Revenue Service Form 1001, or successor applicable form
certifying to such Liquidity Lender's entitlement as of the
date of such form to receive payments other than payments of
interest under this Liquidity Agreement, any Liquidity Advance
Notes or any other Liquidity Documents without deduction or
withholding of any United States federal income taxes (and
deliver to DTFC and the Liquidity Agent two further copies of
such form on or before the date the most recently delivered
form expires or becomes obsolete and after the occurrence of
any event requiring a change in the most recently delivered
form and, if necessary, obtain at the expense of DTFC, any
extensions of time reasonably requested by DTFC for the
delivery of such forms); and (ii) agree, upon reasonable
request of DTFC, to provide to DTFC and the
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Liquidity Agent (for the benefit of DTFC and the Liquidity
Agent), such other forms as may be reasonably required under
Applicable Law in order to establish the legal entitlement of
such Liquidity Lender to an exemption from withholding of
Taxes with respect to any payments under this Liquidity
Agreement, any Liquidity Advance Notes and any other Liquidity
Document;
unless in any such case any change in treaty, law or regulation or any change in
any previously published ruling, notice or other similar official Internal
Revenue Service interpretation of a treaty, law or regulation has occurred after
the date such Person becomes a Liquidity Lender hereunder or the Liquidity
Agent, as the case may be, which renders all such forms inapplicable to such
Liquidity Lender or the Liquidity Agent or which would prevent such Liquidity
Lender or the Liquidity Agent from duly completing and delivering any such form
with respect to it and such Liquidity Lender or the Liquidity Agent promptly so
advises DTFC and the Liquidity Agent (in the case of a Liquidity Lender) in
writing. Each Person that shall become a Liquidity Lender or a Liquidity
Participant pursuant to Section 11.11.1 or 11.11.2 shall, upon the effectiveness
of the related transfer, be required to provide all of the forms, certifications
and statements required pursuant to this Section, provided that in the case of a
Liquidity Participant the obligations of such Liquidity Participant, pursuant to
this clause (b) shall be determined as if such Liquidity Participant were a
Liquidity Lender except that such Liquidity Participant shall furnish all such
required forms, certifications and statements to the Liquidity Lender from which
the related participation shall have been purchased.
SECTION 5.7. Payments, Computations, etc. Unless otherwise expressly
provided, all payments by DTFC pursuant to this Liquidity Agreement, the
Liquidity Advance Notes and any other Liquidity Document shall be made by DTFC
to the Liquidity Agent for the pro rata account, on the basis of Liquidity
Advances Outstanding, or if no Liquidity Advances are outstanding, on the basis
of Liquidity Commitments, of the Liquidity Lenders entitled to receive such
payment. All such payments required to be made to the Liquidity Agent by DTFC
shall be made, without setoff, deduction or counterclaim, not later than 1:00
p.m. (New York City, New York time) on the date due, in same day or immediately
available funds, to the account established pursuant to Section 3.7(a) or such
other account as the Liquidity Agent shall specify from time to time by notice
to DTFC. Funds received after that time shall be deemed to have been received by
the Liquidity Agent on the next succeeding Business Day. The Liquidity Agent
shall promptly remit in same day funds to each Liquidity Lender its share, if
any, of such payments received by the Liquidity Agent for the account of such
Liquidity Lender. Whenever any payment to be made shall otherwise be due on a
day which is not a Business Day, such payment shall (except as otherwise
required by the second proviso of the definition of the term "Interest Period"
with respect to Eurodollar Advances) be made on the next succeeding Business Day
and such extension of time shall be included in computing interest and fees, if
any, in connection with such payment.
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SECTION 5.8. Sharing of Payments. If any Liquidity Lender shall obtain
any payment or other recovery (whether voluntary or involuntary) on account of
any Liquidity Advance (other than pursuant to the terms of Sections 5.3, 5.4,
5.5 and 5.6) in excess of its pro rata share of payments, on the basis of
Liquidity Advances Outstanding, or if no Liquidity Advances are outstanding, on
the basis of Liquidity Commitments, then or therewith obtained by all Liquidity
Lenders, such Liquidity Lender shall purchase from the other Liquidity Lenders
such participation in Liquidity Advances made by them as shall be necessary to
cause such purchasing Liquidity Lender to share the excess payment or other
recovery with each of them on a pro rata basis, computed on the basis of each
Liquidity Lender's Liquidity Advances Outstanding or Liquidity Commitment, as
the case may be, on the date of such computation; provided, however, that if all
or any portion of the excess payment or other recovery is thereafter recovered
from such purchasing Liquidity Lender, the purchase shall be rescinded to the
extent of such recovery and each Liquidity Lender which has sold a participation
to the purchasing Liquidity Lender shall repay to the purchasing Liquidity
Lender the purchase price to the ratable extent of such recovery together with
an amount equal to such selling Liquidity Lender's ratable share (according to
the proportion of
(a) the amount of such selling Liquidity Lender's required
repayment to the purchasing Liquidity Lender
to
(b) the total amount so recovered from the purchasing
Liquidity Lender)
of any interest or other amount paid or payable by the purchasing Liquidity
Lender in respect of the total amount so recovered. DTFC agrees that any
Liquidity Lender so purchasing a participation from another Liquidity Lender
pursuant to this Section may, to the fullest extent permitted by law, exercise
all its rights of payment with respect to such participation as fully as if such
Liquidity Lender were the direct creditor of DTFC in the amount of such
participation. If under any applicable bankruptcy, insolvency or other similar
law, any Liquidity Lender receives a secured claim to which this Section
applies, such Liquidity Lender shall, to the extent practicable, exercise its
rights in respect of such secured claim in a manner consistent with the rights
of the Liquidity Lenders entitled under this Section to share in the benefits of
any recovery on such secured claim.
SECTION 5.9. Replacement of Liquidity Lenders. (a) If at any time the
credit rating assigned to the short-term obligations of any Liquidity Lender (an
"Affected Liquidity Lender") is withdrawn or downgraded below the rating then
assigned by S&P, Moody's or DCR (if rated by DCR), respectively, to the
Commercial Paper Notes, DTFC may, upon five Business Days' prior written notice
given to the Liquidity Agent and such Affected Liquidity Lender acceptable to
the Liquidity Agent, replace such Affected Liquidity Lender with an Eligible
Liquidity Lender or a Liquidity Lender already party to this Liquidity Agreement
and
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such replacement shall be made in accordance with clause (a) of Section 11.11.1
and the proviso of clause (b) of this Section 5.9; provided, however, that
payment of the processing fee referred to in clause (B) of Section 11.11.1(a)
shall not be required; and provided further, however, no such replacement
pursuant to this clause (a) shall be effective unless S&P, Moody's and DCR shall
have confirmed in writing to DTFC and the Liquidity Agent that such replacement
(i) would not result in a withdrawal or reduction of the rating by S&P, Moody's
or DCR of the Commercial Paper Notes below the rating then assigned by such
Rating Agency to the Commercial Paper Notes or (ii) if the Commercial Paper
Notes are then rated less than A-1 by S&P, P-1 by Moody's or D-1 by DCR would
result in an upgrade of the rating by S&P, Moody's or DCR of the Commercial
Paper Notes over the rating then assigned by such Rating Agency to the
Commercial Paper Notes.
(b) In the event that (i) any Liquidity Lender shall have notified the
Liquidity Agent or DTFC (and shall not have retracted such notification) that
its compliance with any of its obligations hereunder would be unlawful, (ii) any
Liquidity Lender fails to extend its Liquidity Commitment upon request, (iii)
DTFC is required pursuant to Section 4.2.1(b) or Sections 5.3 through 5.6 to
make any payment to or on behalf of any Liquidity Lender (or would be so
required on or prior to the next following date on which a payment hereunder
(other than pursuant to Section 5.6) is required to be made to or for any such
Liquidity Lender) or (iv) any Liquidity Lender shall have failed to fund any
Liquidity Advance when required hereunder, then DTFC shall have the right, at
its own expense, upon notice to such Liquidity Lender and the Liquidity Agent,
to require such Liquidity Lender, and such Liquidity Lender hereby agrees, to
transfer and assign without recourse (in accordance with and subject to the
restrictions contained in Section 11.11) all the interests, rights and
obligations of such Liquidity Lender under the Liquidity Documents to an
Eligible Liquidity Lender provided by DTFC; provided, however, that (w) no such
assignment shall conflict with any law, rule, regulation or order of any
Governmental Authority, (x) such assignment shall be without recourse,
representation and warranty and shall be on terms and conditions reasonably
satisfactory to such replaced Liquidity Lender and such replacement Eligible
Liquidity Lender, (y) the purchase price paid by such replacement Eligible
Liquidity Lender shall be an amount equal to the aggregate amount of all
Liquidity Advances owed to such replaced Liquidity Lender, and (z) DTFC or such
Eligible Liquidity Lender, as the case may be, shall pay to such replaced
Liquidity Lender in same day funds on the date of such assignment the principal
of and interest accrued to the date of payment on the Liquidity Advances made by
such replaced Liquidity Lender hereunder and all other amounts accrued for such
replaced Liquidity Lender's account or owed to it hereunder, including those
amounts owed pursuant to Section 4.2.1(b) and Sections 5.3 through 5.6.
SECTION 5.10. Order and Priority. Notwithstanding any other provision
of this Liquidity Agreement (other than Section 4.2.2.), the Liquidity Agent and
the Liquidity Lenders agree that the Obligations of DTFC to the Liquidity Agent
and the Liquidity Lenders hereunder shall be payable in the order and priority
set forth in Section 2.01 and 5.02(b), as
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applicable, of the Collateral Agreement. The Liquidity Agent and the Liquidity
Lenders agree that, during any period that Commercial Paper Notes shall be
outstanding (any such period being a "Specified Period"), the Obligations shall
be due and payable only to the extent that DTFC's Assets and the Enhancement
Amount are sufficient to pay the same. If, during any Specified Period, the
Liquidity Lenders shall exercise their rights, pursuant to Section 9.2(ii), to
accelerate the Obligations, such acceleration shall have the limited effect of
(i) causing the interest rates contemplated in Section 4.2.2 to become effective
with respect to the outstanding Obligations and (ii) allowing the Liquidity
Lenders, in any determination of the Liquidity Lenders' allocative share of any
disbursement to be made to Secured Parties under the Collateral Agreement or
otherwise among creditors of DTFC, to treat all of the Obligations as then being
due and payable. No claims of the Liquidity Lenders arising under or in
connection with this Liquidity Agreement are intended to be impaired or waived
by this Section 5.10.
ARTICLE VI
CONDITIONS PRECEDENT
SECTION 6.1. Conditions to Effectiveness. This Liquidity Agreement
shall become effective on the date (the "Closing Date") when all of the
conditions set forth in Section 6.1 have been satisfied (and each Liquidity
Lender's signature hereto evidences that such conditions have been satisfied
with respect to such Liquidity Lender).
SECTION 6.1.1. Organic Documents, Resolutions. The Liquidity Agent
shall have received: (i) a copy of DTFC's certificate of incorporation,
including all amendments thereto, certified as of a recent date by the Secretary
of State of the State of Oklahoma, and a certified copy of all other Organic
Documents of DTFC, and such certificate or other Organic Documents shall be in
form and substance satisfactory to the Liquidity Agent and its counsel, and a
certificate as to the good standing of DTFC as of a recent date, from such
Secretary of State; (ii) a certificate of the Secretary or Assistant Secretary
of DTFC dated the Closing Date and certifying (A) that attached thereto is a
true and complete copy of the Bylaws of DTFC as in effect on the Closing Date
and at all times since a date prior to the date of the resolutions described in
clause (B) below, (B) that attached thereto is a true and complete copy of
resolutions in form and substance reasonably satisfactory to the Liquidity Agent
and its counsel and duly adopted by the Board of Directors of DTFC authorizing
the execution, delivery and performance of this Liquidity Agreement and each of
the other CP Program Documents to which DTFC is a party and the transactions
contemplated hereby and thereby, and that such resolutions have not been
modified, rescinded or amended and are in full force and effect, (C) that the
certificate of incorporation of DTFC has not been amended since the date of the
last amendment thereto shown on the certificate of good standing furnished
pursuant to clause (i) above and (D) as to the incumbency and specimen signature
of each officer executing this Liquidity Agreement and each of the other CP
Program Documents to which DTFC is a party
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or any other document delivered in connection herewith or therewith on behalf of
DTFC; (iii) a certificate of another officer as to the incumbency and specimen
signature of the Secretary or Assistant Secretary executing the certificate
pursuant to clause (ii) above; and (iv) such other documents as the Liquidity
Agent may reasonably request.
SECTION 6.1.2. Liquidity Agreement. The Liquidity Agent shall have
received executed counterparts of this Liquidity Agreement, duly executed by
DTFC, the Liquidity Agent, and each Liquidity Lender.
SECTION 6.1.3. Liquidity Advance Notes. The Liquidity Agent shall have
received, for the account of each Liquidity Lender, such Liquidity Lender's
Liquidity Advance Note duly executed and delivered by DTFC.
SECTION 6.1.4. Collateral Agreement. (a) The Liquidity Agent shall have
received executed counterparts of the Collateral Agreement, dated as of the
Closing Date, duly executed by DTFC, the Collateral Agent, the Liquidity Agent,
the Depositary, each Dealer and the Series 1998-1 Letter of Credit Provider.
SECTION 6.1.5. Series 1998-1 Supplement. The Liquidity Agent shall have
received copies of the executed Series 1998-1 Supplement, dated as of the
Closing Date, duly executed by RCFC and Bankers Trust Company, as trustee and
enhancement agent, and all of the conditions to the effectiveness thereof and to
the issuance of the Series 1998-1 Notes set forth therein shall have been
satisfied in all respects.
SECTION 6.1.6. Series 1998-1 Notes. The Collateral Agent shall have
received, on behalf of the Secured Parties, the Series 1998-1 Notes, in an
aggregate face amount equal to $615,000,000, duly executed by RCFC and duly
authenticated by the Trustee.
SECTION 6.1.7. Master Lease. The Trustee shall have received the
original executed Master Lease, dated as of the Closing Date, duly executed by
RCFC, DTAG and each of the Lessees, and the Liquidity Agent shall have received
the executed Master Lease and copies of all documents and opinions required to
be delivered to RCFC thereunder, all conditions to the effectiveness thereof set
forth therein shall have been satisfied in all respects, provided that the
satisfaction of the conditions to the effectiveness thereof set forth therein
relating to the title of the Vehicles and the perfection of the security
interests in the Vehicles shall be satisfactory to the Liquidity Agent.
SECTION 6.1.8. Series 1998-1 Letter of Credit. The Series 1998-1 Letter
of Credit in an amount initially equal to $5,000,000 shall have been delivered
to the Enhancement Agent and shall be in form and substance satisfactory to the
Syndication Agent (as defined in the Credit Agreement), the Liquidity Agent and
the Collateral Agent and in full force and effect,
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and the Series 1998-1 Letter of Credit Provider shall have a short-term rating
not lower than A-1 from S&P, P-1 from Moody's and D-1 from DCR (if rated by
DCR).
SECTION 6.1.9. Depositary Agreement. The Liquidity Agent shall have
received executed counterparts of the Depositary Agreement, dated as of the
Closing Date, duly executed by DTFC and the Depositary, and all of the
conditions to the effectiveness thereof set forth therein shall have been
satisfied in all respects.
SECTION 6.1.10. Dealer Agreement. The Liquidity Agent shall have
received executed counterparts of the Dealer Agreement, dated as of the Closing
Date, duly executed by DTFC and each Dealer, and all of the conditions to the
effectiveness thereof set forth therein shall have been satisfied in all
respects.
SECTION 6.1.11. Absence of Certain Events; Accuracy of Liquidity
Agreement Representations and Warranties; Closing Date Certificate. (a) No
Liquidity Agreement Amortization Event, Limited Liquidity Agreement Amortization
Event or Lease Event of Default shall have occurred and be continuing, (b) the
representations and warranties set forth in Article VII shall be true and
correct (in all material respects to the extent any such representations and
warranties do not incorporate a materiality limitation in their terms) as of the
Closing Date and (c) the Liquidity Agent shall have received a Closing Date
Certificate, dated the Closing Date, duly executed and delivered by an
Authorized Officer of DTFC, in which DTFC shall have represented and warranted
that the representations and warranties of DTFC in the CP Program Documents are
true and correct (in all material respects to the extent any such
representations and warranties do not incorporate a materiality limitation in
their terms) as of the Closing Date and that no Liquidity Agreement Amortization
Event, Limited Liquidity Agreement Amortization Event or, to the best of such
Authorized Officer's knowledge, Potential Liquidity Agreement Amortization Event
has occurred and is continuing, and, at the time such certificate is delivered,
the Liquidity Agent shall be satisfied that such statements are in fact true and
correct (in all material respects to the extent that any such statements do not
incorporate a materiality limitation in their terms).
SECTION 6.1.12. Accounts. The Commercial Paper Account, the Termination
Advance Account, the Collateral Account and the Master Collateral Account shall
have been established and shall be in full force and effect.
SECTION 6.1.13. Rating Letters. DTFC shall have received as of the
Closing Date (i) a rating letter from S&P to the effect that the Commercial
Paper Notes shall have been given a rating of at least A-1 by S&P, which rating
shall be in full force and effect, (ii) a rating letter from Moody's to the
effect that the Commercial Paper Notes shall have been given a rating of at
least P-1 by Moody's, which rating shall be in full force and effect, and (iii)
a rating letter from DCR to the effect that the Commercial Paper Notes shall
have been given a rating of at least D-1 by DCR, which rating shall be in full
force and effect.
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SECTION 6.1.14. Board of Directors. The Liquidity Agent shall consent
to the composition of DTFC's Board of Directors (including any Independent
Director), which consent shall not be unreasonably withheld.
SECTION 6.1.15. Solvency Certificate. The Liquidity Agent shall have
received a certificate, dated the Closing Date, and duly executed by a Financial
Officer of DTFC, in scope and substance satisfactory to the Liquidity Agent, to
the effect that DTFC will be solvent after giving effect to the transactions
contemplated by this Liquidity Agreement, each of the other CP Program Documents
and the issuance and sale of the Commercial Paper Notes.
SECTION 6.1.16. Closing Fees and Expenses. The Liquidity Agent shall
have received for its own account and for the account of the Liquidity Lenders
any fees and expenses due and payable pursuant to Sections 4.5 and 11.3 and any
fees and expenses due and payable pursuant to the Fee Letter or any other any
fee letters or commitment letters entered into with any Liquidity Lender and/or
the Liquidity Agent, including reasonable fees and expenses of counsel to the
Liquidity Agent.
SECTION 6.1.17. Certified Copies of Vehicle Disposition Programs. The
Liquidity Agent shall have received from RCFC a copy of each Vehicle Disposition
Program under which Group II Vehicles will be or have been purchased and an
Officer's Certificate of RCFC or the applicable Lessee, dated the Closing Date,
certifying that each such copy is true, correct and complete as of the Closing
Date.
SECTION 6.1.18. Opinions, Instruments, Certificates and Other
Documents. The Liquidity Agent shall have received opinions of counsel,
addressed to the Liquidity Agent and the Liquidity Lenders hereto, reasonably
satisfactory in form and substance to the Liquidity Agent and the Liquidity
Lenders, and the Liquidity Agent and each Liquidity Lender shall have received
such additional instruments, certificates and other documents as the Liquidity
Agent or such Liquidity Lender shall have reasonably requested in form and
substance reasonably satisfactory to the Liquidity Agent or such Liquidity
Lender.
SECTION 6.1.19. Notation of Liens. The Liquidity Agent shall have
received evidence (which, in the case of the filing of financing statements on
form UCC-1, may be telephonic confirmation of such filing) that all filings
(including filings of financing statements on form UCC-1) and recordings have
been accomplished as may be required by law to establish, perfect, protect and
preserve the rights, titles, interests, remedies, powers, privileges, licenses
and security interest of (a) the Master Collateral Agent in the Group II
Collateral and (b) the Collateral Agent in the Assigned Collateral for the
benefit of the Secured Parties.
SECTION 6.1.20. Offering Materials. Each offering circular, offering
memorandum (including, without limitation, the Offering Memorandum) or
information circular to be used
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by DTFC or the Dealers in connection with the offer or sale of Commercial Paper
Notes, insofar as it describes or refers to the Liquidity Agent or any Liquidity
Lender, shall be reasonably satisfactory to the Liquidity Agent or such
Liquidity Lender, respectively.
SECTION 6.1.21. Satisfactory Legal Form. This Liquidity Agreement, each
of the other CP Program Documents and all other documents executed or submitted
pursuant hereto or thereto by or on behalf of DTFC shall be reasonably
satisfactory in form and substance to the Liquidity Agent and its counsel; and
the Liquidity Agent and its counsel shall have received all information,
approvals, opinions, documents or instruments as the Liquidity Agent or its
counsel may have reasonably requested on the Closing Date.
SECTION 6.1.22. Credit Rating of Initial Liquidity Lenders. As of the
Closing Date, each initial Liquidity Lender shall have credit ratings assigned
to its short-term obligations of at least A-1 by S&P, P-1 by Moody's and D-1 by
DCR (if rated by DCR).
SECTION 6.1.23. Credit Agreement. (i) The Liquidity Agent and the
Collateral Agent shall have received copies of the executed Credit Agreement,
dated as of December 23, 1997, duly executed by DTAG, Dollar, Thrifty, the
financial institutions identified as the Lenders thereunder, the Administrative
Agent and the Syndication Agent, (ii) the Credit Agreement shall be in full
force and effect and (iii) no Event of Default (as defined in the Credit
Agreement) shall have occurred and be continuing.
SECTION 6.2. [Reserved].
SECTION 6.3. Conditions Precedent to the Making of Each Refunding
Advance. The obligation of any Liquidity Lender to make any Refunding Advance
(including any Commitment Termination Date Liquidity Advance) and of the Swing
Line Lender to make any Swing Line Advance shall be subject to the satisfaction
of the following conditions at the time of making of such Refunding Advance or
Swing Line Advance:
SECTION 6.3.1. No Bankruptcy. (i) No Event of Bankruptcy of the type
described in clauses (a) or (b) of the definition thereof with respect to DTFC
shall have occurred and be continuing and (ii) no Event of Bankruptcy of the
type described in clauses (a) or (b) of the definition thereof with respect to
the Series 1998-1 Letter of Credit Provider shall have occurred and be
continuing at any time prior to the funding in full of the Series 1998-1 Cash
Collateral Account.
SECTION 6.3.2. Availability. The Enhancement Amount shall not have been
reduced to zero.
SECTION 6.3.3. No Borrowing Base Deficiency. A Borrowing Base
Deficiency shall not exist after giving effect to the application of such
Refunding Advance or Swing Line
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Advance; provided, however, that this provision shall not release the Liquidity
Lenders from the obligation (upon receipt of a Borrowing Request in the
appropriate amount) to make Refunding Advances or Swing Line Advances up to the
amount of the then current Borrowing Base that would not cause a Borrowing Base
Deficiency to exist.
SECTION 6.3.4. Borrowing Request. The Liquidity Agent shall have
received a Borrowing Request for such Borrowing.
SECTION 6.3.5. Borrowing Base Certificate. The Liquidity Agent shall
have received an Officer's Certificate, dated the date of the making of such
Refunding Advance or Swing Line Advance, duly executed and delivered by an
Authorized Officer of DTFC, certifying the amount of the Borrowing Base as of
the close of business on the day immediately preceding such date.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
To induce the Liquidity Lenders and the Liquidity Agent to enter into
this Liquidity Agreement and to make Liquidity Advances hereunder, DTFC
represents and warrants to the Liquidity Agent and each Liquidity Lender as set
forth in this Article VII as of the making of each Liquidity Advance (except as
otherwise specified).
SECTION 7.1. Existence and Power. DTFC is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Oklahoma, is duly qualified to do business as a foreign corporation and in
good standing under the laws of each jurisdiction where the character of its
property, the nature of its business or the performance of its obligations make
such qualification necessary, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
There have been no amendments to the Organic Documents of DTFC since
the respective dates of the certified copies furnished to the Liquidity Agent
pursuant to Section 6.1.1, other than amendments, if any, not prohibited by this
Liquidity Agreement (copies of which have been furnished to the Liquidity
Agent).
SECTION 7.2. Authorization. The execution, delivery and performance by
DTFC of this Liquidity Agreement and each of the other CP Program Documents to
which it is a party are within DTFC's corporate powers and have been duly
authorized by all necessary corporate action. This Liquidity Agreement and each
other CP Program Document to which DTFC is a party have been duly executed and
delivered by DTFC.
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SECTION 7.3. Binding Effect. This Liquidity Agreement and each other CP
Program Document to which DTFC is a party constitutes a legal, valid and binding
obligation of DTFC enforceable against DTFC in accordance with its respective
terms (except as may be limited by bankruptcy, moratorium or other laws
affecting creditors' rights generally and subject to limitations imposed by
equitable principles).
SECTION 7.4. Financial Information; Financial Condition. All balance
sheets, all statements of operations, of shareholders' equity and of cash flow,
and other financial data (other than projections) which have been or shall
hereafter be furnished by DTFC to Liquidity Lenders pursuant to Section 8.1.1
have been and will be prepared in accordance with GAAP (to the extent
applicable) and do and will present fairly in all material respects the
financial condition of the entities involved as of the dates thereof and the
results of their operations for the periods covered thereby, subject, in the
case of all unaudited statements, to normal year-end adjustments and lack of
footnotes and presentation items.
SECTION 7.5. Litigation. There is no action, suit or proceeding pending
against or, to the knowledge of DTFC, threatened against DTFC before any court
or arbitrator or any Governmental Authority in which there is a reasonable
possibility of an adverse decision that could materially adversely affect the
consolidated financial position, consolidated results of operations, business,
properties, performance, prospects or condition (financial or otherwise) of DTFC
or which in any manner draws into question the validity or enforceability of
this Liquidity Agreement or any other CP Program Document or the ability of DTFC
to comply with any of the respective terms thereunder.
SECTION 7.6. No ERISA Plan. DTFC has not established and does not
maintain or contribute to any employee benefit plan that is covered by Title IV
of ERISA, and will not do so, so long as the Liquidity Commitment Termination
Date has not occurred, or any amount is owing to a Liquidity Lender hereunder.
SECTION 7.7. Tax Filings and Expenses. DTFC has filed all federal,
state and local tax returns and all other tax returns which, to the knowledge of
DTFC, are required to be filed (whether informational returns or not), and has
paid all taxes due, if any, pursuant to said returns or pursuant to any
assessment received by DTFC, except such taxes, if any, as are being contested
in good faith and for which adequate reserves have been set aside on its books.
DTFC has paid all fees and expenses required to be paid by it in connection with
the conduct of its business, the maintenance of its corporate existence and its
qualification as a foreign corporation authorized to do business in each State
in which it is required to so qualify, except where the failure to pay any such
fees and expenses is not reasonably likely to have a Material Adverse Effect.
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SECTION 7.8. Disclosure. The materials listed on Annex B hereto and
furnished to the Liquidity Agent or any Liquidity Lender in connection with this
Liquidity Agreement were at the time the same were so furnished, complete and
correct in all material respects.
SECTION 7.9. Investment Company Act; Securities Act. DTFC is not
controlled by an "investment company" and is not required to register as an
"investment company" under the Investment Company Act. The Commercial Paper
Notes are exempt from registration under Section 3(a)(3) of the Securities Act
of 1933, as amended. It is not necessary in connection with the issuance of the
Commercial Paper Notes under the circumstances contemplated by this Liquidity
Agreement and the other CP Program Documents to qualify any indenture under the
Trust Indenture Act of 1939, as amended.
SECTION 7.10. Margin Regulations. No proceeds of any Liquidity Advance
or the sale of any Commercial Paper Note will be used to purchase or carry any
"margin stock" (as defined or used in Regulation G, T, U or X of the F.R.S.
Board or any successor thereto) or to extend credit to others for such purpose.
DTFC is not engaged in the business of extending credit for the purpose of
purchasing or carrying any margin stock.
SECTION 7.11. No Consent. No consent, action by or in respect of,
approval or other authorization of, or registration, declaration or filing with,
any Governmental Authority or other Person is required for the valid execution
and delivery and performance of this Liquidity Agreement or any other CP Program
Document by DTFC for the payment of any amounts by DTFC hereunder or thereunder
or for the performance of any of DTFC's Obligations hereunder or thereunder
other than such consents, approvals, authorizations, registrations, declarations
or filings as shall have been obtained by DTFC prior to the Closing Date.
SECTION 7.12. No Violation of Laws, etc. The execution and delivery of
this Liquidity Agreement and each of the other CP Program Documents, compliance
with the provisions hereof and thereof and the consummation of the transactions
contemplated herein and therein will not result in (a) a breach or violation of,
and do not contravene, or constitute a default under, (i) any law or
governmental rule or regulation applicable to DTFC now in effect, (ii) any
provision of any Organic Document of DTFC, (iii) any judgment, injunction, order
or decree of any Governmental Authority against DTFC or any of its Assets, or
(iv) any agreement, contract or instrument to which DTFC is a party or by which
it or any of its Assets is bound, (b) the acceleration of any Obligations of
DTFC, or (c) the creation or imposition of any Lien on any Assets of DTFC other
than in favor of the Collateral Agent or as permitted by the CP Program
Documents.
SECTION 7.13. Ownership; Subsidiaries. As of the Closing Date, 100% of
the common stock of DTFC is owned by DTAG. As of the Closing Date, DTFC has no
Subsidiaries and owns no capital stock of, or other interest in, any other
Person.
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SECTION 7.14. Solvency. Both before and after giving effect to the
transactions contemplated by this Liquidity Agreement and the other CP Program
Documents, DTFC is solvent and DTFC is not the subject of any voluntary or
involuntary case or proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy or insolvency
law, or of any other Event of Bankruptcy.
SECTION 7.15. No Security Interest. (A) There is no effective financing
statement listing DTFC as debtor (other than any which may have been filed on
behalf of the Collateral Agent) covering any of the Assigned Collateral that is
on file in any public office; (B) at the date of each deposit of Deposited Funds
in the Commercial Paper Account there are no Liens on the Deposited Funds or the
Commercial Paper Account, except the assignment made pursuant to the Collateral
Agreement in favor of the Collateral Agent; and (C) DTFC is and will be the
lawful owner of (with good and marketable title to), and has and will have
beneficial ownership of (or the benefit, through the Enhancement Agent and the
Master Collateral Agent, of a first priority perfected security interest, in the
case of the Group II Vehicles and the Vehicle Disposition Programs), all
Assigned Collateral, free and clear of all Liens except Permitted Liens.
SECTION 7.16. Vehicle Disposition Programs. On the date of each
Borrowing, each Manufacturer from which Group II Vehicles are purchased and each
Vehicle Disposition Program covering Group II Vehicles shall be an Eligible
Manufacturer and Eligible Vehicle Disposition Program, respectively.
SECTION 7.17. Other Representations. All representations and warranties
of DTFC made in each CP Program Document to which it is a party are true and
correct (in all material respects to the extent any such representations and
warranties do not incorporate a materiality limitation in their terms) and are
repeated herein as though fully set forth herein.
ARTICLE VIII
COVENANTS
SECTION 8.1. Affirmative Covenants. DTFC covenants and agrees with the
Liquidity Agent and each Liquidity Lender that, until all Liquidity Commitments
have terminated and all Obligations have been paid or performed in full, unless
the Majority Banks shall otherwise consent in writing, DTFC will perform the
covenants set forth in this Section 8.1.
SECTION 8.1.1. Information. DTFC will deliver to the Liquidity Agent
(with a copy for each Liquidity Lender), and each Rating Agency:
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(a) promptly upon the delivery by RCFC to DTFC, a copy of the
financial information and other materials required to be delivered by
DTAG to RCFC and the Collateral Agent pursuant to Section 24.4 of the
Master Lease (other than the VIN list as required by Section 24.4(f) of
the Master Lease);
(b) from time to time such additional information regarding
the financial position, results of operations or business of DTAG and
its Subsidiaries as the Liquidity Agent may reasonably request to the
extent that RCFC delivers such information to DTFC pursuant to Section
7.01(c) of the Note Purchase Agreement or that any of the Liquidity
Lenders reasonably requires and directs DTFC in its capacity as the
holder of the Series 1998-1 Notes in writing to request from RCFC
pursuant to Section 7.3(c) of the Base Indenture subject to the
reasonableness standard for requests for information set forth in such
section;
(c) as soon as available and in any event (i) within one
hundred ten (110) days after the end of each fiscal year of DTAG and
its Subsidiaries a consolidated balance sheet and statement of earnings
as at the end of such fiscal year and (ii) within forty-five (45) days
after the end of each fiscal quarter (except for the fourth fiscal
quarter) of DTAG and its Subsidiaries a consolidated balance sheet and
statement of earnings as at the end of such fiscal quarter;
(d) at the time of delivery of the items described in clause
(a) above, a certificate of an officer of DTFC that, except as provided
in any certificate delivered in accordance with Section 8.1.9, no
Liquidity Agreement Amortization Event, Lease Event of Default or (to
the best of such officer's knowledge) Potential Liquidity Agreement
Amortization Event or Potential Lease Event of Default has occurred or
is
continuing during such fiscal quarter;
(e) at the time of delivery of the items described in clause
(c)(i) above, a certificate of the chief financial officer of DTFC
certifying that (i) the ratings assigned by the Rating Agencies in
respect of the commercial paper issued by DTFC have not been withdrawn
or downgraded below A-1 by S&P, P-1 by Moody's and D-1 by DCR since the
date of this Liquidity Agreement, (ii) whether any Rating Agency has
determined that the Minimum Enhancement Amount must be increased, (iii)
no change in the Vehicle Disposition Program of any Manufacturer in
respect of any new model year shall have given rise to any request on
the part of the Rating Agencies that any modification be made to the
Master Lease or any other CP Program Document, and (iv) DTFC has
apprised the Rating Agencies of all material changes in the Vehicle
Disposition Programs occurring since the date of this Liquidity
Agreement;
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(f) promptly following the introduction of any prospective
material change in any Vehicle Disposition Program or the introduction
of any new Vehicle Disposition Program by an existing Manufacturer,
notice and a copy of the same;
(g) on or prior to the twentieth day of each month (or if such
day is not a Business Day, on the next succeeding Business Day), a copy
of the Monthly Vehicle Statement (excluding the VIN list) relating to
the Assigned Collateral as of the last Business Day of the immediately
preceding month delivered by DTAG pursuant to Section 24.4(f) of the
Master Lease;
(h) on each Business Day when any Liquidity Advance is
outstanding, DTFC shall cause the Collateral Agent to provide to the
Liquidity Agent a statement setting forth (A) the maturity date and
face amount of each outstanding Commercial Paper Note and (B) the
aggregate principal amount of outstanding Liquidity Advances (or, at
DTFC's option, a statement updating any statement previously provided
by DTFC to the Liquidity Agent which contained such information as of a
prior date); and
(i) furnish, or cause to be furnished to the Liquidity Agent
and each of the Rating Agencies, as soon as available and in any event
within 90 days after the end of each fiscal year of DTAG, (A) a copy of
the annual audit report for such fiscal year for DTAG and its
subsidiaries, including therein a consolidated balance sheet of DTAG
and its subsidiaries and a consolidating balance sheet of DTAG and its
direct subsidiaries (including DTFC), in each case as of the end of
such fiscal year, and consolidated statements of operations and cash
flow of DTAG and its subsidiaries and consolidating statements of
operations and cash flow of DTAG and its direct subsidiaries (including
DTFC), in each case for such fiscal year, in each case certified by
Deloitte & Touche or other nationally recognized independent public
accountants acceptable to the Liquidity Agent.
SECTION 8.1.2. Compliance with Covenants. DTFC will comply with all
covenants made by it and contained in each CP Program Document to which it is a
party.
SECTION 8.1.3. Payment of Obligations. DTFC will pay and discharge, at
or before maturity, all of its respective obligations and liabilities,
including, without limitation, tax liabilities and other governmental claims,
except where the same may be contested in good faith by appropriate proceedings,
and will maintain, in accordance with GAAP, reserves as appropriate for the
accrual of any of the same.
SECTION 8.1.4. Maintenance of Separate Existence. DTFC will (i)
maintain its existence as a corporation validly existing and in good standing
under the laws of the State of Oklahoma and duly qualified as a foreign
corporation licensed under the laws of each state in which the failure to so
qualify would have a Material Adverse Effect on the business and
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operations of DTFC, (ii) do all things necessary to maintain its corporate
existence separate and apart from that of DTAG and Affiliates of DTAG including,
without limitation, (A) practicing and adhering to corporate formalities, such
as maintaining appropriate corporate books and records; (B) maintaining at least
two corporate directors who are Independent Directors; (C) owning or leasing
(including through shared arrangements with Affiliates) all office furniture and
equipment necessary to operate its business; (D) not (I) guaranteeing or
otherwise becoming liable for any obligations of any of its Affiliates, (II)
having obligations guaranteed by any of its Affiliates, (III) holding itself out
as responsible for debts of any of its Affiliates or for decisions or actions
with respect to the affairs of any of its Affiliates and (IV) being directly or
indirectly named as a direct or contingent beneficiary or loss payee on any
insurance policy of any Affiliate other than as required by the CP Program
Documents with respect to insurance on the Vehicles; (E) other than as provided
in the CP Program Documents, maintaining its deposit and other bank accounts and
all of its Assets separate from those of any other Person; (F) maintaining its
financial records separate and apart from those of any other Person; (G)
compensating all its employees, officers, consultants and agents for services
provided to it by such Persons, or reimbursing any of its Affiliates in respect
of services provided to it by employees, officers, consultants and agents of
such Affiliate, out of its own funds; (H) maintaining office space separate and
apart from that of any of its Affiliates (even if such office space is subleased
from or is on or near premises occupied by any of its Affiliates) and a
telephone number separate and apart from that of any of its Affiliates; (I)
accounting for and managing all of its liabilities separately from those of any
of its Affiliates; (J) allocating, on an arm's-length basis, all shared
corporate operating services, leases and expenses, including, without
limitation, those associated with the services of shared consultants and agents
and shared computer and other office equipment and software; (K) refraining from
filing or otherwise initiating or supporting the filing of a motion in any
bankruptcy or other insolvency proceeding involving DTFC, DTAG or any Affiliate
of DTAG, to substantively consolidate DTFC with DTAG or any Affiliate; (L)
remaining solvent and (M) conducting all of its business (whether written or
oral) solely in its own name, (iii) maintain in place all policies and
procedures relating to DTFC, and take and continue to take all action relating
to DTFC, described in the factual assumptions set forth in that certain opinion
letter issued by Mayer, Brown & Platt, dated March 4, 1998, addressing the issue
of substantive consolidation as it may relate to DTAG, RCFC, the Lessees and
DTFC (a copy of which opinion letter DTFC hereby acknowledges it has received),
(iv) on a semi-annual basis, provide to the Liquidity Agent and each of the
Rating Agencies an Officer's Certificate of DTFC certifying that it is in
compliance with its obligations under clauses (ii) and (iii) of this Section
8.1.4 and (v) on an annual basis provide to the Liquidity Agent and each of the
Rating Agencies a letter of independent certified public accountants of
nationally recognized standing selected by DTFC, addressed to the Liquidity
Agent and each of the Rating Agencies, stating whether, in connection with their
audit of the consolidated financial statements of DTAG, anything came to their
attention that caused them to believe that DTFC failed to comply with the terms,
covenants, provisions or conditions of clauses (ii) and (iii) of this Section
8.1.4
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insofar as they relate to financial and accounting matters. DTFC will serve as
the agent for the Liquidity Agent and the Rating Agencies in coordinating
receipt of such letter.
SECTION 8.1.5. Compliance with Laws. DTFC will comply with all
Applicable Laws of Governmental Authorities (including, without limitation,
ERISA and the rules and regulations thereunder) except where the failure to
comply therewith is not reasonably likely to have a Material Adverse Effect on
the business and operations of DTFC.
SECTION 8.1.6. Inspection of Property, Books and Records. DTFC will
keep proper books of record and account in which full, true and correct entries
shall be made of all dealings and transactions in relation to its Assets,
business and activities in accordance with GAAP; and will permit representatives
of the Liquidity Agent and, if a Liquidity Agreement Amortization Event shall
have occurred and is continuing, representatives of any Liquidity Lender, at
DTFC's expense, to visit and inspect any of its properties, to examine and make
abstracts from any of its books and records and to discuss its affairs, finances
and accounts with its officers, directors, employees and independent public
accountants, all at such reasonable times and as often as the Liquidity Agent or
such Liquidity Lender may reasonably deem appropriate (but not more often than
once a month in the case (i) of any Liquidity Lender and (ii) of the Liquidity
Agent prior to the occurrence of a Liquidity Agreement Amortization Event).
SECTION 8.1.7. Absence of Certain Actions. DTFC will not take any
action which would permit any Lessee or DTAG to have the right to refuse to
perform any of its obligations under the Master Lease or permit RCFC to have the
right to refuse to perform any of its obligations under the Series 1998-1 Notes
or the Series 1998-1 Supplement.
SECTION 8.1.8. Notice of Default. Promptly upon becoming aware of any
Potential Liquidity Agreement Amortization Event, Potential Lease Event of
Default, Lease Event of Default, Liquidity Agreement Amortization Event,
Potential Event of Default (as defined in the CP Enhancement Letter of Credit
Application and Agreement) or Event of Default (as defined in the CP Enhancement
Letter of Credit Application and Agreement), DTFC shall give the Liquidity
Agent, the Liquidity Lenders, the Dealers and each Rating Agency notice thereof,
together with a certificate of the President, Vice President or the principal
financial officer of DTFC setting forth the details thereof and any action with
respect thereto taken or contemplated to be taken by DTFC.
SECTION 8.1.9. Notice of Material Proceedings. Promptly upon becoming
aware thereof, DTFC shall give the Liquidity Agent, the Dealers and each Rating
Agency written notice of the commencement or existence of any proceeding by or
before any Governmental Authority against or affecting DTFC which is reasonably
likely to have a Material Adverse Effect on the business, condition (financial
or otherwise), results of operations, properties or performance of DTFC or the
ability of DTFC to perform its Obligations under this Liquidity Agreement or
under any other CP Program Document to which it is a party.
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SECTION 8.1.10. Further Requests. DTFC will promptly furnish to the
Liquidity Agent and each Rating Agency such other information as, and in such
form as, the Liquidity Agent or any Rating Agency may reasonably request.
SECTION 8.1.11. Further Assurances. DTFC agrees to do such further acts
and things, and to execute and deliver to the Liquidity Agent such additional
assignments, agreements, powers and instruments, as the Liquidity Agent
reasonably determines to be necessary to carry into effect the purposes of this
Liquidity Agreement or to better assure and confirm unto the Liquidity Agent its
rights, powers and remedies hereunder.
SECTION 8.1.12. Vehicle Disposition Programs. DTFC agrees that it will
(i) provide the Liquidity Agent, the Dealers and each Rating Agency with at
least 30 days' prior written notice of its intention to make Advances to RCFC
under the Series 1998-1 Notes for the purchase or financing by RCFC of Vehicles
manufactured by any new Manufacturer, (ii) provide the Liquidity Agent, the
Dealers and each Rating Agency with a copy of the draft Vehicle Disposition
Program of such Manufacturer as it then exists at the time of such notice and a
copy of the final Vehicle Disposition Program promptly upon its being available
and (iii) certify to the Liquidity Agent and the Liquidity Lenders that such new
Manufacturer is an Eligible Manufacturer and that such Vehicle Disposition
Program is an Eligible Vehicle Disposition Program at such time. In no event
shall DTFC agree, to the extent any consent of DTFC is solicited or required by
the Manufacturer or any assignor of such Vehicle Disposition Program, to any
change in any Vehicle Disposition Program that is reasonably likely to
materially adversely affect its rights or the rights of the Secured Parties with
respect to any Vehicle previously purchased under such Vehicle Disposition
Program.
SECTION 8.1.13. Use of Proceeds of Commercial Paper Notes. DTFC shall
use the proceeds of the Commercial Paper Notes solely for one or more of the
following purposes: (a) to pay matured Commercial Paper Notes when due, in
accordance with the Depositary Agreement; (b) to fund advances under the Series
1998-1 Notes; and (c) to pay principal of, or interest on, any Liquidity Advance
or any other amount payable by DTFC under this Liquidity Agreement or to
reimburse the Series 1998-1 Letter of Credit Provider for any LOC Liquidity
Disbursement and any interest thereon or the Series 1998-1 Cash Collateral
Account for any LOC Liquidity Disbursement and any interest thereon.
Notwithstanding any provision of this Liquidity Agreement, on any day
when any Liquidity Advance is outstanding, DTFC shall not use the net proceeds
of the issuance of Commercial Paper Notes to fund further advances under the
Series 1998-1 Notes.
SECTION 8.1.14. Vehicles. DTFC shall use commercially reasonable
efforts to cause (i) each applicable Lessee to maintain good, legal and
marketable title to the Existing Fleet and the Financed Vehicles that are Group
II Vehicles owned by such Lessee, free and clear of all Liens except for
Permitted Liens and (ii) to cause RCFC to maintain good, legal and
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marketable title to the Acquired Vehicles that are Group II Vehicles, free and
clear of all Liens except for Permitted Liens.
SECTION 8.2. Negative Covenants. DTFC covenants and agrees with the
Liquidity Agent and each Liquidity Lender that until all Liquidity Commitments
have been terminated and all Obligations have been paid or performed in full,
unless the Majority Banks otherwise consent in writing, DTFC will perform the
Obligations set forth in this Section 8.2.
SECTION 8.2.1. Liens. DTFC will not create, incur, assume or permit to
exist any Lien upon any of its Assets (including the Assigned Collateral), the
Accounts, the Commercial Paper Account, the Series 1998-1 Cash Collateral
Account or the Deposited Funds, other than Liens created by or permitted under
the CP Program Documents.
SECTION 8.2.2. Other Indebtedness. Without (a) the prior written
consent of the Majority Banks and (b) the prior receipt of written confirmation
of the Rating Agencies that any such action will not result in the downgrading
or withdrawal of the then current ratings of the Commercial Paper Notes by the
Rating Agencies, DTFC will not create, assume, incur, suffer to exist or
otherwise become or remain liable in respect of any Indebtedness other than
Indebtedness under this Liquidity Agreement, Indebtedness evidenced by the
Commercial Paper Notes and Indebtedness under or permitted under any other CP
Program Document.
SECTION 8.2.3. Consolidations and Mergers . DTFC will not, except as
may be permitted by the express written approval of the Majority Banks and upon
the receipt of written confirmation of each Rating Agency that such action will
not result in the downgrading or withdrawal of its then current ratings of the
Commercial Paper Notes, merge with or into, enter into any joint venture or
other association with, or consolidate with, any other Person.
SECTION 8.2.4. Sales of Assets. DTFC will not sell, lease, transfer,
liquidate or otherwise dispose of any Assets, except as contemplated by the CP
Program Documents and provided that the proceeds thereof are paid directly to
the Collateral Account.
SECTION 8.2.5. Acquisition of Assets. DTFC will not acquire, by
long-term or operating lease or otherwise, any Assets, except pursuant to the
terms of the CP Program Documents.
SECTION 8.2.6. Dividends, Officers' Compensation, etc. DTFC will not
declare or pay any dividends on any shares of its capital stock or make any
other distribution on, or any purchase, redemption or other acquisition of, any
shares of its capital stock except out of any source legally available therefor.
SECTION 8.2.7. Name; Chief Executive Office. DTFC will neither (i)
change the location of its chief executive office (within the meaning of the
UCC) without sixty (60) days'
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prior notice to the Collateral Agent, the Liquidity Agent and each Rating Agency
nor (ii) change its name without prior notice to the Collateral Agent, the
Liquidity Agent and each Rating Agency sufficient to allow the Collateral Agent
to make all filings (including filings of financing statements on form UCC-1)
and recordings necessary to perfect the interest of the Collateral Agent in the
Assigned Collateral pursuant to the Collateral Agreement.
SECTION 8.2.8. Organic Documents. DTFC will not amend any of its
Organic Documents without the written consent of the Majority Banks and each of
the Rating Agencies.
SECTION 8.2.9. Investments. DTFC will not make, incur, or suffer to
exist any loan, advance, extension of credit to, or other investment in, any
Person other than pursuant to the Series 1998-1 Notes and with respect to
Eligible Investments.
SECTION 8.2.10. No Other Agreements; Amendments to CP Program
Documents. DTFC will not, without the prior written consent of the Majority
Banks and the Series 1998-1 Letter of Credit Provider, (i) enter into or be a
party to any material agreement or instrument other than any CP Program Document
or documents and agreements incidental thereto or (ii) amend, modify, waive or
give any approval, consent or permission under, any provision of any CP Program
Document to which it is a party other than, in the case of the Credit Agreement
or the Depositary Agreement, such amendments that relate to minor administrative
matters that do not amend or modify (A) the amount or timing of any payments (or
priorities for payments) to be made under the CP Program Documents, (B) any
rights in the Assigned Collateral (or any priorities or rights or restrictions
on encumbrances with respect thereto), or (C) any prohibition or restriction on
the incurrence of any Indebtedness under the CP Program Documents.
Notwithstanding the foregoing provisions of this Section 8.2.10, DTFC may, at
any time and from time to time, without the consent of the Majority Banks, enter
into any amendment, supplement or other modification to any CP Program Document,
in form and substance satisfactory to the Liquidity Agent, to cure any apparent
ambiguity or to correct or supplement any inconsistent provisions therein;
provided, however, that (i) any such action shall not have a Material Adverse
Effect on the interests of the Liquidity Lenders and (ii) a copy of such
amendment, supplement or other modification is furnished to the Liquidity
Lenders and each of the Rating Agencies in accordance with the notice provisions
hereof not later than ten days prior to the execution thereof.
SECTION 8.2.11. Other Business. DTFC will not engage in any business or
enterprise or enter into any transaction other than the making of advances to
RCFC under the Series 1998-1 Notes, the related exercise of its rights as a
secured creditor, the issuance of Commercial Paper Notes, the incurrence of
Indebtedness under this Liquidity Agreement and the Series 1998-1 Letter of
Credit, the incurrence and payment of ordinary course operating expenses and as
otherwise contemplated by the CP Program Documents.
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SECTION 8.2.12. Offering Document. DTFC will not include in any
offering document for the Commercial Paper Notes any information regarding any
Liquidity Lender which was not approved or furnished by such Liquidity Lender.
ARTICLE IX
LIQUIDITY AGREEMENT AMORTIZATION EVENTS
SECTION 9.1. Liquidity Agreement Amortization Event. Each of the
following events or occurrences described in this Section 9.1 shall constitute a
"Liquidity Agreement Amortization Event".
SECTION 9.1.1. Non-Payment of Obligations. DTFC shall (a) fail to repay
maturing Commercial Paper Notes when due; (b) fail to make a payment on the
Scheduled Maturity Date or date of prepayment (as a result of a mandatory
prepayment requirement under Section 4.1.2) of principal of any Liquidity
Advance on of the date on which such payment is due; or (c) fail to make a
payment of any interest on any Liquidity Advance, any fees or any other amounts
payable hereunder within three Business Days of the date on which such payment
is due.
SECTION 9.1.2. Breach of Warranty. Any representation or warranty made
by DTFC herein or in any other CP Program Document to which it is a party shall
have been incorrect in any material respect (to the extent that any such
representation or warranty does not incorporate a materiality limitation in its
terms) as of the date such representation or warranty is made and, such
representation or warranty continues to be incorrect in any material respect (to
the extent that any such representation or warranty does not incorporate a
materiality limitation in its terms) for a period of 30 days after the earlier
of (i) the date on which written notice thereof shall have been given to DTFC by
the Liquidity Agent or any Liquidity Lender and (ii) the date on which DTFC
obtains actual knowledge thereof, or any certificate, financial statement or any
other material writing furnished by DTFC pursuant to this Liquidity Agreement or
any such other CP Program Document shall have been incorrect in any material
respect when made (or deemed made) and, such certificate, financial statement or
other material writing continues to be incorrect in any material respect for a
period of 10 days (other than with respect to any Officer's Certificate
delivered with respect to the Borrowing Base, for which such period is one
Business Day) after the earlier of (a) the date on which written notice thereof
shall have been given to DTFC by the Liquidity Agent or any Liquidity Lender and
(b) the date on which DTFC obtains actual knowledge thereof.
SECTION 9.1.3. Non-Performance of Certain Covenants and Obligations.
DTFC shall default in the due performance and observance of any of its
Obligations under Section 8.2 and such default shall continue unremedied for a
period of ten days after the earlier of (i) the
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date on which written notice thereof shall have been given to DTFC by the
Liquidity Agent or any Liquidity Lender and (ii) the date on which DTFC obtains
actual knowledge thereof.
SECTION 9.1.4. Non-Performance of Other Covenants and Obligations. DTFC
shall default in the due performance and observance of any covenant or agreement
contained herein or in any other CP Program Document to which it is a party
(other than those specified in Sections 9.1.1, 9.1.2 and 9.1.3), and, in the
case of defaults other than with respect to Section 8.1.8 or 8.1.9, such default
shall continue unremedied for a period of 30 days after notice thereof shall
have been given to DTFC by the Liquidity Agent or any Liquidity Lender or, in
the case of Section 8.1.8 or 8.1.9, such default shall continue unremedied for a
period of 30 days after DTFC initially becomes aware of such failure to perform
or comply with such covenant.
SECTION 9.1.5. Judgments. Any final and unappealable (or, if capable of
appeal, such appeal is not being diligently pursued or enforcement thereof has
not been stayed) judgment or order for the payment of money in excess of
$100,000, shall be rendered against DTFC or RCFC and such judgment or order
shall continue unsatisfied and unstayed for a period of 60 days.
SECTION 9.1.6. Bankruptcy, Insolvency, etc. The occurrence of any Event
of Bankruptcy with respect to DTFC, RCFC or the Master Servicer.
SECTION 9.1.7. Independent Directors. DTFC shall fail to have two or
more Independent Directors on its board and such failure shall have continued
for a period of 30 days.
SECTION 9.1.8. Enforceability of or Default under CP Program Documents.
(a) Any of the CP Program Documents or any portion thereof shall not be in full
force and effect or enforceable in accordance with its terms or DTFC, RCFC, DTAG
or any Manufacturer shall so assert in writing, (b) any Lease Event of Default
shall occur under the Master Lease, (c) any Amortization Event with respect to
the Series 1998-1 Notes, as defined in Section 8.1 of the Base Indenture and
Section 5.1 of the Series 1998-1 Supplement, shall occur or (d) any Event of
Default (as defined in the Credit Agreement) set forth in Sections 9.1.9(a)
through (d) of the Credit Agreement shall have occurred or any Event of Default
set forth in Section 9.1.9 of the Credit Agreement other than those set forth in
Sections 9.1.9(a) through (d) shall have occurred and the Administrative Agent
shall have declared all or any portion of the Obligations (as defined in the
Credit Agreement) to be due and payable and/or the Commitments (as defined in
the Credit Agreement) to be terminated.
SECTION 9.1.9. Investment Company. DTFC shall have become an
"investment company" or shall have become under the "control" of an "investment
company" under the Investment Company Act.
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SECTION 9.1.10. Program Downgrade. The rating on the Commercial Paper
Notes shall have been downgraded to A-2 by S&P, P-2 by Moody's or D-1- by DCR,
or less, or withdrawn and all of the Liquidity Lenders shall have a rating of
A-1, or better, by S&P, P-1, or better, by Moody's and, if rated by DCR, D-1, or
better, by DCR.
SECTION 9.1.11. Termination of Liquidity Commitments or Reduction of
Aggregate Liquidity Commitment. The Liquidity Commitment Termination Date with
respect to all Liquidity Lenders shall have occurred or the Aggregate Liquidity
Commitment is reduced due to the failure of certain Liquidity Lenders to renew
their Liquidity Commitments on any date to 50% or less of the Aggregate
Liquidity Commitment in effect immediately prior to such reduction.
SECTION 9.1.12. Liquidity Advance under Section 3.6.1(b). Liquidity
Advances are made pursuant to Section 3.6.1(b).
SECTION 9.1.13. Series 1998-1 Enhancement Deficiency. A Series 1998-1
Enhancement Deficiency shall occur and continue for at least one (1) Business
Day after the Master Servicer obtains actual knowledge thereof; provided,
however, that such event or condition shall not be a Liquidity Agreement
Amortization Event if within such one (1) Business Day period DTAG shall have
taken any of the actions described in the proviso to Section 5.1(a) of the
Series 1998-1 Supplement such that the Series 1998-1 Enhancement Deficiency no
longer exists and such action is in accordance with the terms of Section
4.7(d)(v) of the Series 1998-1 Supplement.
SECTION 9.2. Action if Liquidity Agreement Amortization Event. If any
Liquidity Agreement Amortization Event set forth in Sections 9.1.1, 9.1.5,
9.1.7, 9.1.9, 9.1.10 or 9.1.11 shall have occurred and be continuing, the
Collateral Agent, upon having actual knowledge thereof, without the request or
consent of the Liquidity Agent or the Majority Banks, in every such event and at
any time thereafter during the continuance of such event, shall, and if any
Liquidity Agreement Amortization Event has occurred, the Collateral Agent, at
the request or with the consent of the Majority Banks conveyed through the
Liquidity Agent, shall, in every such event and at any time thereafter during
the continuance of such event, by notice to DTFC and DTAG, at the same or
different times, notify the Depositary and the Dealers of the occurrence of such
Liquidity Agreement Amortization Event, and instruct DTFC and the Depositary to
cease issuing Commercial Paper Notes and the right of DTFC to issue Commercial
Paper Notes shall automatically terminate. If any Liquidity Agreement
Amortization Event occurs under Section 9.1.6, without giving effect to any
grace periods included in the definition of Event of Bankruptcy, the Liquidity
Agent will instruct the Depositary and DTFC in writing to cease issuing
Commercial Paper Notes. In addition, the Liquidity Agent shall, (i) upon the
occurrence of any Liquidity Agreement Amortization Event, terminate the
Liquidity Commitments hereunder if such Liquidity Agreement Amortization Event
is pursuant to Section 9.1.6 with respect to DTFC; (ii) upon the
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occurrence of any event specified in Sections 9.1.1 through 9.1.10 at the
request, or with the consent, of Liquidity Lenders then holding, in the
aggregate, Liquidity Commitments in excess of 50% of the Aggregate Liquidity
Commitment (or, if the Aggregate Liquidity Commitment shall have been
terminated, Liquidity Lenders then holding, in the aggregate, in excess of 50%
of the principal amount of Liquidity Advances then outstanding), by notice to
DTFC, declare the aggregate principal amount of any Liquidity Advances then
outstanding, together with accrued interest and all fees and other Obligations
hereunder, immediately due and payable whereupon all such principal, accrued
interest, fees and other Obligations hereunder shall become and be forthwith due
and payable, without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by DTFC; provided, however, that in the
case of any Liquidity Agreement Amortization Event under Section 9.1.6 with
respect to DTFC, (A) the Liquidity Commitment of each Liquidity Lender shall
automatically be terminated and (B) all such principal, interest, fees and other
Obligations shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby
expressly waived by DTFC; (iii) instruct DTFC in writing to cease making
Advances under the Series 1998-1 Notes; and (iv) pursue any other right or
remedy under this Liquidity Agreement and the other CP Program Documents or
under Applicable Law or otherwise.
SECTION 9.3. Limited Liquidity Agreement Amortization Events. Each of
the following events or occurrences described in this Section 9.3 shall
constitute a "Limited Liquidity Agreement Amortization Event".
SECTION 9.3.1. Ineligibility of Manufacturer or Repurchase Program. (a)
Any Manufacturer or any Vehicle Disposition Program shall cease to be an
Eligible Manufacturer or an Eligible Vehicle Disposition Program, respectively,
(b) any Manufacturer, pursuant to its Vehicle Disposition Program, shall fail to
pay an aggregate amount equal to the aggregate amount of repurchase obligations
of such Manufacturer under its Vehicle Disposition Program in respect of Group
II Vehicles (or such other amount as shall have been agreed to for this purpose
by DTFC and the Majority Banks at the time that DTFC proposes such Manufacturer
for consideration as an "Eligible Manufacturer" under the CP Program Documents),
in each case, owed by it in respect of any Group II Vehicles turned back in
accordance with the terms of the related Vehicle Disposition Program and such
failure shall continue for 90 days after such aggregate amount shall have become
due and payable or (c) any Event of Bankruptcy shall have occurred with respect
to any Manufacturer.
SECTION 9.3.2. Termination of Liquidity Commitment. The Liquidity
Commitment of any Liquidity Lender shall have been terminated and DTFC shall
have failed to replace any such Liquidity Lender within the time period required
by Section 5.9.
SECTION 9.3.3. Rating Downgrade of Liquidity Lender. A Rating Downgrade
below A-2 by S&P, P-2 by Moody's or D-1- by DCR (if rated by DCR) shall occur
and be
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continuing for 60 days (or such other period permitted by the Rating Agencies)
with respect to any Liquidity Lender and such Liquidity Lender shall not have
been replaced pursuant to Section 5.9 hereof.
SECTION 9.4. Action Upon Limited Liquidity Agreement Amortization
Event.
(a) If any Limited Liquidity Agreement Amortization Event set
forth in Section 9.3.1 shall have occurred and be continuing with
respect to any Manufacturer, DTFC shall not make any further advances
under the Series 1998-1 Notes to fund the purchase or financing of
Vehicles of such Manufacturer and no Commercial Paper Notes shall be
issued to finance any such purchase or financing.
(b) If any Limited Liquidity Agreement Amortization Event set
forth in Section 9.3.2 shall have occurred and be continuing, then DTFC
shall not issue Commercial Paper Notes to the extent that after giving
effect to such issuance (and the use of proceeds thereof), the
Aggregate Face Amount shall exceed the Program Size (reduced by the
aggregate Liquidity Commitments of the Liquidity Lenders that have been
terminated).
(c) If any Limited Liquidity Agreement Amortization Event set
forth in Section 9.3.3 shall have occurred and be continuing, then DTFC
shall not issue Commercial Paper Notes to the extent that after giving
effect to such issuance (and the use of proceeds thereof), the
Aggregate Face Amount shall exceed the Program Size (reduced by the
aggregate Liquidity Commitments of the Affected Liquidity Lenders).
ARTICLE X
THE LIQUIDITY AGENT
SECTION 10.1. Actions. Each Liquidity Lender hereby appoints CSFB as
its Liquidity Agent under and for purposes of this Liquidity Agreement, the
Liquidity Advance Notes and each other CP Program Document. Each Liquidity
Lender hereby authorizes the Liquidity Agent to act on behalf of such Liquidity
Lender under this Liquidity Agreement, the Liquidity Advance Notes and each
other CP Program Document and, in the absence of other written instructions from
the Majority Banks received from time to time by the Liquidity Agent (with
respect to which the Liquidity Agent agrees that it will comply, except as
otherwise provided in this Section or as otherwise advised by counsel), to
exercise such powers hereunder and thereunder as are specifically delegated to
or required of the Liquidity Agent by the terms hereof and thereof, together
with such powers as may be reasonably incidental thereto. Each Liquidity Lender
hereby indemnifies (which indemnity shall survive any termination of this
Liquidity Agreement) the Liquidity Agent, pro rata according to such
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Liquidity Lender's Percentage, from and against any and all liabilities,
obligations, losses, damages, claims, costs or expenses of any kind or nature
whatsoever which may at any time be imposed on, incurred by, or asserted
against, the Liquidity Agent in any way relating to or arising out of this
Liquidity Agreement, the Liquidity Advance Notes and any other CP Program
Document, including reasonable attorneys' fees (including the allocated costs of
in-house counsel), and as to which the Liquidity Agent is not reimbursed by
DTFC; provided, however, that no Liquidity Lender shall be liable for the
payment of any portion of such liabilities, obligations, losses, damages,
claims, costs or expenses which are determined by a court of competent
jurisdiction in a final proceeding to have resulted from the Liquidity Agent's
gross negligence or wilful misconduct. The Liquidity Agent shall not be required
to take any action hereunder, under the Liquidity Advance Notes or under any
other CP Program Document, or to prosecute or defend any suit in respect of this
Liquidity Agreement, the Liquidity Advance Notes or any other CP Program
Document, unless it is indemnified hereunder to its satisfaction. If any
indemnity in favor of the Liquidity Agent shall be or become, in the Liquidity
Agent's determination, inadequate, the Liquidity Agent may call for additional
indemnification from the Liquidity Lenders and cease to do the acts indemnified
against hereunder until such additional indemnity is given.
SECTION 10.2. Collateral Agreement. Without limiting the authorizations
otherwise set forth in this Article X, each Liquidity Lender hereby authorizes
the Liquidity Agent to execute and deliver the Collateral Agreement and each of
the other CP Program Documents as Liquidity Agent and on behalf of such
Liquidity Lender, with the same effect as if such Liquidity Lender had executed
the Collateral Agreement or such CP Program Document in its own name. Each
Liquidity Lender acknowledges that the Collateral Agreement contains certain
provisions, including, without limitation, Section 7.02 thereof, which give rise
to indemnification obligations in respect of the Collateral Agent on the part of
such Liquidity Lender and such Liquidity Lender hereby agrees to be bound by
such provisions, as the same may from time to time be modified in accordance
with the terms of the Collateral Agreement and this Liquidity Agreement.
SECTION 10.3. Exculpation. Neither the Liquidity Agent nor any of its
directors, officers, employees or agents shall be liable to any Liquidity Lender
for any action taken or omitted to be taken by it under this Liquidity Agreement
or any other CP Program Document, or in connection herewith or therewith, except
for its own wilful misconduct or gross negligence, nor responsible for any
recitals or warranties herein or therein, nor for the effectiveness,
enforceability, validity or due execution of this Liquidity Agreement or any
other CP Program Document, nor for the creation, perfection or priority of any
Liens purported to be created by any of the CP Program Documents, or the
validity, genuineness, enforceability, existence, value or sufficiency of any
collateral security, nor to make any inquiry respecting the performance by DTFC
of its Obligations hereunder or under any other CP Program Document. Any such
inquiry which may be made by the Liquidity Agent shall not obligate it to make
any further inquiry or to take any action. The Liquidity Agent shall be
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entitled to rely upon advice of counsel concerning legal matters and upon any
notice, consent, certificate, statement or writing which the Liquidity Agent
believes to be genuine and to have been presented by a proper Person. As to any
matters not expressly provided for in this Liquidity Agreement or any other CP
Program Document, the Liquidity Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Majority Banks.
SECTION 10.4. Successor. The Liquidity Agent may resign as such at any
time upon at least 30 days' prior written notice to DTFC and all Liquidity
Lenders, and the Liquidity Agent may be removed at any time with cause by the
Majority Banks. If the Liquidity Agent at any time shall resign or be removed,
the Majority Banks may appoint (with, if no Potential Liquidity Agreement
Amortization Event or Liquidity Agreement Amortization Event (other than a
Scheduled Liquidity Agreement Amortization Event) then exists, the consent of
DTFC, which consent shall not be unreasonably withheld or delayed) another
Liquidity Lender as a successor Liquidity Agent which shall thereupon become the
Liquidity Agent hereunder. If no successor Liquidity Agent shall have been so
appointed by the Majority Banks, and shall have accepted such appointment,
within 30 days after the retiring Liquidity Agent's giving notice of resignation
or the Majority Banks' removal of the retiring Liquidity Agent, then the
retiring Liquidity Agent may, on behalf of the Liquidity Lenders, appoint a
successor Liquidity Agent, which shall be one of the Liquidity Lenders or an
Eligible Liquidity Lender. The resignation or removal of the Liquidity Agent
shall not become effective until a successor Liquidity Agent has been appointed
and shall have accepted such appointment. Upon the acceptance of any appointment
as Liquidity Agent hereunder by a successor Liquidity Agent, such successor
Liquidity Agent shall be entitled to receive from the retiring Liquidity Agent
such documents of transfer and assignment as such successor Liquidity Agent may
reasonably request, and shall thereupon succeed to and become vested with all
rights, powers, privileges and duties of the retiring Liquidity Agent, and the
retiring Liquidity Agent shall be discharged from its duties and obligations
under this Liquidity Agreement and all other CP Program Documents. After any
retiring Liquidity Agent's resignation or removal hereunder as the Liquidity
Agent, the provisions of
(a) this Article X shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was the Liquidity
Agent under this Liquidity Agreement; and
(b) Section 11.3 and Section 11.4 shall continue to inure to
its benefit.
SECTION 10.5. Liquidity Advances by CSFB. CSFB (and any successor
thereto in its capacity as Liquidity Agent, that is also a Liquidity Lender)
shall have the same rights and powers with respect to (x) the Liquidity Advances
made by it or any of its Affiliates, and (y) the Liquidity Advance Notes held by
it or any of its Affiliates as any other Liquidity Lender and may exercise the
same as if it were not the Liquidity Agent. CSFB (and such
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successor) and its Affiliates may accept deposits from, lend money to, and
generally engage in any kind of business with DTFC or any Affiliate of DTFC as
if CSFB (and such successor) were not the Liquidity Agent hereunder.
SECTION 10.6. Credit Decisions. Each Liquidity Lender acknowledges that
it has, independently of the Liquidity Agent and each other Liquidity Lender,
and based on such Liquidity Lender's review of the financial information of
DTFC, RCFC, the Lessees and DTAG, this Liquidity Agreement, the other CP Program
Documents (the terms and provisions of which being satisfactory to such
Liquidity Lender) and such other documents, information and investigations as
such Liquidity Lender has deemed appropriate, made its own credit decision to
extend its Liquidity Commitment. Each Liquidity Lender also acknowledges that it
will, independently of the Liquidity Agent and each other Liquidity Lender, and
based on such other documents, information and investigations as it shall deem
appropriate at any time, continue to make its own credit decisions as to
exercising or not exercising from time to time any rights and privileges
available to it under this Liquidity Agreement or any other CP Program Document.
SECTION 10.7. Copies, etc. The Liquidity Agent shall give prompt notice
to each Liquidity Lender of each notice or request required or permitted to be
given to the Liquidity Agent by DTFC pursuant to the terms of this Liquidity
Agreement (unless concurrently delivered to the Liquidity Lenders by DTFC). The
Liquidity Agent will distribute to each Liquidity Lender each document or
instrument received for its account and copies of all other communications
received by the Liquidity Agent from DTFC for distribution to the Liquidity
Lenders by the Liquidity Agent in accordance with the terms of this Liquidity
Agreement.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1. Waivers, Amendments, etc. (a) The provisions of this
Liquidity Agreement and each other CP Program Document to which DTFC is a party
may from time to time be amended, modified or waived, if (i) prior written
notice of such amendment, modification or waiver is given to each of the Rating
Agencies and the Dealers, (ii) subject to Section 8.2.10 hereof as it relates to
amendments of the CP Program Documents other than this Liquidity Agreement, such
amendment, modification or waiver is in writing and consented to in writing by
DTFC, the Series 1998-1 Letter of Credit Provider and the Majority Banks and
(iii) such amendment, modification or waiver shall not, as evidenced by written
confirmation of the Rating Agencies, result in the downgrading or withdrawal of
the then current ratings of the Commercial Paper Notes by the Rating Agencies;
provided, however, that such written confirmation and consent will not be
required in connection with the extension of a Liquidity Lender's Scheduled
Liquidity Commitment Termination Date pursuant
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to Section 3.5; provided further, however, that any modification of Section 6.3
or this Section 11.1, any requirement hereunder that any particular action be
taken by all the Liquidity Lenders or by the Majority Banks or any change in the
definition of the term "Required Liquidity Providers", "Borrowing Base
Deficiency", "Eligible Manufacturer" (with respect to the Series 1998-1 Notes),
"Eligible Vehicle Disposition Program" (with respect to the Series 1998-1
Notes), "Event of Bankruptcy" or "Majority Banks" or any defined term used for
the purpose of any such definition shall require the consent of each Liquidity
Lender and the Series 1998-1 Letter of Credit Provider; and further provided
that any amendment, waiver or other modification that would
(i) increase the Liquidity Commitment or the Percentage of any
Liquidity Lender or reduce any fees described in Article IV payable to
any Liquidity Lender shall require the consent of such Liquidity
Lender;
(ii) amend the definition of the Scheduled Maturity Date, the
Scheduled Liquidity Commitment Termination Date, or the Liquidity
Commitment Termination Date shall require the consent of each Liquidity
Lender affected thereby;
(iii) extend the due date for, or reduce the amount of, any
scheduled repayment or prepayment of principal of or interest on any
Liquidity Advance of any Liquidity Lender (or reduce the principal
amount of or rate of interest on any Liquidity Advance of any Liquidity
Lender) shall require the consent of each Liquidity Lender affected
thereby;
(iv) modify or waive the conditions precedent to the
effectiveness of this Liquidity Agreement set forth in Article VI shall
require the consent of each Liquidity Lender;
(v) approve the assignment or transfer by DTFC of any of its
rights or Obligations hereunder or under any other CP Program Document
to which it is a party except pursuant to the express terms hereof or
thereof shall require the consent of each Liquidity Lender;
(vi) release any of the Assigned Collateral from the Lien
under the Collateral Agreement or the Master Collateral Agency
Agreement, or release any obligor under any CP Program Document to
which it is a party except pursuant to the express terms of such CP
Program Document shall require the consent of each Liquidity Lender,
provided, however, that the Master Collateral Agent shall release liens
on Group II Vehicles in accordance with the Master Collateral Agency
Agreement and the Base Indenture;
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(vii) affect adversely the interests, rights or obligations of
any Liquidity Lender individually in comparison to other Liquidity
Lenders shall require the consent of such Liquidity Lender;
(viii) affect adversely the interests, rights or obligations
of either the Liquidity Agent or the Collateral Agent in its capacity
as such shall require the consent of the Liquidity Agent or the
Collateral Agent, as the case may be;
(ix) amend or otherwise modify any Liquidity Agreement
Amortization Event shall require the consent of each Liquidity Lender;
or
(x) amend or waive any condition precedent to the issuance of
the Commercial Paper Notes set forth in Section 2.2 shall require
written confirmation from each of S&P, Moody's and DCR that such
amendment or waiver will not result in the downgrading or withdrawal of
the then current ratings of the Commercial Paper Notes by each of S&P,
Moody's and DCR.
(b) Notwithstanding the foregoing provisions of this Section 11.1, DTFC
and the Liquidity Agent may, at any time and from time to time, without the
consent of the Liquidity Lenders, enter into any amendment, supplement or other
modification to this Liquidity Agreement to cure any apparent ambiguity or to
correct or supplement any provision in this Liquidity Agreement that may be
inconsistent with any other provision herein; provided, however, that (i) any
such action shall not have a materially adverse effect on the interests of the
Liquidity Lenders and (ii) a copy of such amendment, supplement or other
modification is furnished to each Liquidity Lender and each Rating Agency in
accordance with the notice provisions hereof not later than ten days prior to
the execution thereof by DTFC and the Liquidity Agent.
(c) To the extent Noteholder consent is required for an amendment or
waiver of the provisions of the CP Program Documents such consent with respect
to the Series 1998-1 Notes shall be given or withheld by the Collateral Agent in
accordance with Section 4.04 of the Collateral Agreement.
(d) No failure or delay on the part of the Liquidity Agent, any
Liquidity Lender or the holder of any Liquidity Advance Note in exercising any
power or right under this Liquidity Agreement or any other CP Program Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power or right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on DTFC in any case
shall entitle it to any notice or demand in similar or other circumstances. No
waiver or approval by the Liquidity Agent, any Liquidity Lender or the holder of
any Liquidity Advance Note under this Liquidity Agreement or any other CP
Program Document shall, except as may be otherwise stated in such waiver or
approval, be applicable to subsequent transactions. No
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waiver or approval hereunder shall require any similar or dissimilar waiver or
approval thereafter to be granted hereunder.
SECTION 11.2. Notices. All notices, instructions, amendments, waivers,
consents and other communications provided to any party hereto under this
Liquidity Agreement or any other CP Program Document shall be in writing and
addressed, delivered or transmitted to such party at its address or facsimile
number set forth below its signature hereto or set forth in the Liquidity Lender
Assignment Agreement or at such other address or facsimile number as may be
designated by such party in a notice to the other parties. Any notice, if mailed
and properly addressed with postage prepaid or if properly addressed and sent by
pre-paid courier service, shall be deemed given when received; any notice, if
transmitted by facsimile, shall be deemed given when transmitted upon receipt of
electronic confirmation of transmission. Notices to Standard & Poor's will be
sent as follows: Standard & Poor's Ratings Services, 26 Broadway, 15th Floor,
New York, New York 10004, Attention: Asset Backed Surveillance Department,
telephone: (212) 208-8000, telecopier: (212) 412-0225. Notices to Moody's will
be sent as follows: Moody's Investors Service, Inc., 99 Church Street, New York,
New York 10007, Attention: ABS Monitoring Department, Telephone: (212) 553-0300,
telecopier: (212) 553-4600. Notices to DCR will be sent as follows: Duff and
Phelps Credit Rating Co., 55 East Monroe Street, Suite 3800, Chicago, Illinois,
Attention: John Bella, Telephone: (312) 368- 3100, Telecopier: (312) 263-2852.
SECTION 11.3. Payment of Costs and Expenses. DTFC agrees to pay on
demand all reasonable expenses of the Liquidity Agent (including the reasonable
fees and out-of-pocket expenses of counsel to the Liquidity Agent and of local
counsel, if any, who may be retained by counsel to the Liquidity Agent) in
connection with
(a) the negotiation, preparation, execution, delivery and
administration of this Liquidity Agreement and of each other CP Program
Document, including schedules and exhibits, and any amendments,
waivers, consents, supplements or other modifications to this Liquidity
Agreement or any other CP Program Document as may from time to time
hereafter be required, whether or not the transactions contemplated
hereby or thereby are consummated,
(b) the filing, recording, refiling or rerecording of the
Collateral Agreement and/or any UCC financing statements relating
thereto and all amendments, supplements and modifications to any
thereof and any and all other documents or instruments of further
assurance required to be filed or recorded or refiled or rerecorded by
the terms hereof or of the Collateral Agreement,
(c) the preparation and review of the form of any document or
instrument relevant to this Liquidity Agreement or any other CP Program
Document,
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(d) the transactions contemplated by this Liquidity Agreement
and any of the other CP Program Documents, and
(e) the preparation and negotiation of the legal opinions of
counsel to each Liquidity Lender, to the extent required by the Rating
Agencies, up to $2,500 per Liquidity Lender.
DTFC further agrees to pay, and to save the Liquidity Agent and the Liquidity
Lenders harmless from all liability for, (i) any breach by DTFC of any of its
Obligations under this Liquidity Agreement, (ii) all reasonable costs incurred
by the Liquidity Agent or the Liquidity Lenders in enforcing this Liquidity
Agreement against DTFC or its Affiliates and (iii) any stamp, documentary or
other taxes which may be payable in connection with the execution or delivery of
this Liquidity Agreement, any Borrowing hereunder, or the issuance of the
Liquidity Advance Notes or any other CP Program Documents. DTFC also agrees to
reimburse the Liquidity Agent or such Liquidity Lender upon demand for all
reasonable out-of-pocket expenses incurred by the Liquidity Agent or such
Liquidity Lender in connection with (x) the negotiation of any restructuring or
"work-out", whether or not consummated, of any Obligations and (y) the
enforcement of any Obligations.
SECTION 11.4. Indemnification. In consideration of the execution and
delivery of this Liquidity Agreement by each Liquidity Lender and the extension
of the Liquidity Commitments, DTFC hereby indemnifies and holds the Liquidity
Agent and each Liquidity Lender and each of their respective officers,
directors, employees and agents (collectively, the "Indemnified Parties")
harmless from and against any and all actions, causes of action, suits, losses,
costs, liabilities and damages, and reasonable expenses incurred in connection
therewith (irrespective of whether any such Indemnified Party is a party to the
action for which indemnification hereunder is sought and including, without
limitation, any liability in connection with the offering and sale of the
Commercial Paper Notes), including reasonable attorneys' fees and disbursements
(collectively, the "Indemnified Liabilities"), incurred by the Indemnified
Parties or any of them as a result of, or arising out of, or relating to
(a) any transaction financed or to be financed in whole or in
part, directly or indirectly, with the proceeds of any Liquidity
Advance; or
(b) the entering into and performance of this Liquidity
Agreement and any other CP Program Document by any of the Indemnified
Parties,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's gross
negligence or willful misconduct or a breach by such Indemnified Party (or its
agents or employees or any other Person under its control) of any of its
obligations under this Liquidity Agreement, as determined by a final judgment of
a court of competent jurisdiction. If and to the extent that the foregoing
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undertaking may be unenforceable for any reason, DTFC hereby agrees to make the
maximum contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under Applicable Law. The indemnity set forth
in this Section 11.4 shall in no event include indemnification for any Taxes
(which indemnification is provided in Section 5.6). DTFC shall give notice to
the Rating Agencies of any claim for Indemnified Liabilities made under this
Section.
SECTION 11.5. Survival. The Obligations of DTFC under Sections 5.3,
5.4, 5.5, 5.6, 11.3 and 11.4, and the obligations of the Liquidity Lenders under
Sections 10.1 and 10.2, shall in each case survive any termination of this
Liquidity Agreement, the payment in full of all the Obligations and the
termination of all Liquidity Commitments.
SECTION 11.6. Severability. Any provision of this Liquidity Agreement
or any other CP Program Document which is prohibited or unenforceable in any
jurisdiction shall, as to such provision and such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions of this Liquidity Agreement or such CP Program Document or
affecting the validity or enforceability of such provision in any other
jurisdiction.
SECTION 11.7. Headings. The various headings of this Liquidity
Agreement and of each other CP Program Document are inserted for convenience
only and shall not affect the meaning or interpretation of this Liquidity
Agreement or such other CP Program Document or any provisions hereof or thereof.
SECTION 11.8. Execution in Counterparts. This Liquidity Agreement may
be executed by the parties hereto in several counterparts, each of which shall
be executed by DTFC and the Liquidity Agent and be deemed to be an original and
all of which shall constitute together but one and the same agreement.
SECTION 11.9. Governing Law; Entire Agreement. THIS LIQUIDITY AGREEMENT
AND EACH OTHER CP PROGRAM DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE
UNDER, AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES
THEREOF. This Liquidity Agreement, the Liquidity Advance Notes and the other CP
Program Documents constitute the entire understanding among the parties hereto
with
respect to the subject matter hereof and supersede any prior agreements, written
or oral, with respect thereto.
SECTION 11.10. Successors and Assigns. This Liquidity Agreement shall
be binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns; provided, however, that:
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(a) DTFC may not assign or transfer its rights or Obligations
hereunder, other than pursuant to the Collateral Agreement, without (i)
the prior written consent of the Liquidity Agent and all Liquidity
Lenders and (ii) written confirmation from each of the Rating Agencies
that its then current rating of the Commercial Paper Notes will not be
reduced or withdrawn as a result thereof; and
(b) the rights of sale, assignment and transfer of the
Liquidity Lenders are subject to Section 11.11.
SECTION 11.11. Sale and Transfer of Liquidity Advances and Notes;
Participations in Loans and Notes. Each Liquidity Lender may assign, or sell
participations in, its Liquidity Advances and Liquidity Commitment to one or
more other Persons in accordance with this Section 11.11.
SECTION 11.11.1. Assignments. (a) Any Liquidity Lender,
(i) with notice to the Dealers, written confirmation from each
of the Rating Agencies that its then current rating of the Commercial
Paper Notes will not be reduced or withdrawn as a result thereof and
the written consent of DTFC (which consent shall not be unreasonably
withheld), the Liquidity Agent (which consent shall not be unreasonably
withheld) may at any time assign and delegate to an Eligible Liquidity
Lender, and
(ii) with ten days' prior notice to the Rating Agencies, DTFC,
the Liquidity Agent and the Dealers, may assign and delegate to any of
its Affiliates with a credit rating assigned to its short-term
obligations by each Rating Agency that is not lower than the rating
then assigned by such Rating Agency to the Commercial Paper Notes, and
with the written consent of DTFC (which consent shall not be
unreasonably withheld) may at any time assign and delegate to any other
Liquidity Lender
(each Person described in either of the foregoing clauses as the Person to whom
such assignment and delegation is to be made, being hereinafter referred to as
an "Assignee Lender"), all or any fraction of such Liquidity Lender's total
Liquidity Advances and Liquidity Commitment (which assignment and delegation
shall be of a constant, and not a varying, percentage of all the assigning
Liquidity Lender's Liquidity Advances and Liquidity Commitment) in a minimum
aggregate amount of $5,000,000; provided, however, that (x) any such Assignee
Lender will comply, if applicable, with the provisions contained in the last
sentence of Section 5.6 and (y) the minimum aggregate amount of total Liquidity
Commitment and Liquidity Advances, if any, retained by such Liquidity Lender
shall be $5,000,000; provided further, however, that, DTFC and the Liquidity
Agent shall be entitled to continue to deal solely and directly with such
Liquidity Lender in connection with the interests so assigned and delegated to
an Assignee Lender until
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<PAGE> 67
(A) such Assignee Lender shall have executed and delivered to
DTFC and the Liquidity Agent a Liquidity Lender Assignment Agreement,
accepted by the Liquidity Agent;
(B) the processing fees described below shall have been paid;
and
(C) such Assignee Lender shall have delivered an opinion of
counsel acceptable to the Rating Agencies regarding the enforceability
of such Assignee Lender's Liquidity Commitment.
From and after the date that the Liquidity Agent accepts such Liquidity Lender
Assignment Agreement, (x) the Assignee Lender thereunder shall be deemed
automatically to have become a party hereto and to the extent that rights and
obligations hereunder have been assigned and delegated to such Assignee Lender
in connection with such Liquidity Lender Assignment Agreement, shall have the
rights and obligations of a Liquidity Lender hereunder and under the other CP
Program Documents, and (y) the assignor Liquidity Lender, to the extent that
rights and obligations hereunder have been assigned and delegated by it in
connection with such Liquidity Lender Assignment Agreement, shall be released
from its obligations hereunder and under the other CP Program Documents. Within
five Business Days after its receipt of notice that the Liquidity Agent has
received an executed Liquidity Lender Assignment Agreement, DTFC shall, upon
receipt of the Liquidity Advance Notes evidencing such assignor Liquidity
Lender's Liquidity Advance and Liquidity Commitment, execute and deliver to the
Liquidity Agent (for delivery to the relevant Assignee Lender) new Liquidity
Advance Notes evidencing such Assignee Lender's assigned Liquidity Advances and
Liquidity Commitment and, if the assignor Liquidity Lender has retained a
portion of its Liquidity Advances and Liquidity Commitment hereunder,
replacement Liquidity Advance Notes in the principal amount of the Liquidity
Advances and Liquidity Commitment so retained by the assignor Liquidity Lender
hereunder (such Liquidity Advance Notes to be in exchange for, but not in
payment of, those Liquidity Advance Notes then held by such assignor Liquidity
Lender). Each such Liquidity Advance Note shall be dated the date of the
predecessor Liquidity Advance Notes. The assignor Liquidity Lender shall mark
the predecessor Liquidity Advance Notes "exchanged" and deliver them to DTFC.
Accrued interest on that part of the predecessor Liquidity Advance Notes
evidenced by the new Liquidity Advance Notes, and accrued fees, shall be paid as
provided in the Liquidity Lender Assignment Agreement. Accrued interest on that
part of the predecessor Liquidity Advance Notes evidenced by the replacement
Liquidity Advance Notes shall be paid to the assignor Liquidity Lender. Accrued
interest and accrued fees shall be paid at the same time or times provided in
the predecessor Liquidity Advance Notes and in this Liquidity Agreement. Such
assignor Liquidity Lender or such Assignee Lender must also pay a processing fee
to the Liquidity Agent upon delivery of any Liquidity Lender Assignment
Agreement in the amount of $2,500. Such assignor Liquidity Lender and such
Assignee Lender (and not DTFC) shall pay any legal expenses incurred by the
Liquidity Agent in the
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<PAGE> 68
review, documentation and closing of such assignment. Any attempted assignment
and delegation not made in accordance with this Section 11.11.1 shall be null
and void.
(b) Notwithstanding any other provision set forth in this Liquidity
Agreement, any Liquidity Lender may at any time create a security interest in
all or any portion of its rights under this Liquidity Agreement (including,
without limitation, the Liquidity Advances owing to it and the Liquidity Advance
Notes held by it) in favor of any Federal Reserve Bank in accordance with
Regulation A of the Board of Governors of the Federal Reserve System.
SECTION 11.11.2. Participations. Any Liquidity Lender may at any time
sell to one or more commercial banks or other financial institutions (each of
such commercial banks and financial institutions being herein called a
"Liquidity Participant") participating interests in any of the Liquidity
Advances, Liquidity Commitment or other interests of such Liquidity Lender
hereunder; provided, however, that
(a) no participation contemplated in this Section 11.11.2
shall relieve such Liquidity Lender from its Liquidity Commitment or
its other obligations hereunder or under any other CP Program Document
to which such Liquidity Lender is a party;
(b) each participation shall be in a minimum aggregate amount
of $5,000,000 or a smaller amount as may be agreed to by DTFC and the
Liquidity Agent;
(c) such Liquidity Lender shall remain solely responsible for
the performance of its Liquidity Commitment and such other obligations;
(d) DTFC and the Liquidity Agent shall continue to deal solely
and directly with such Liquidity Lender in connection with such
Liquidity Lender's rights and obligations under this Liquidity
Agreement and each of the other CP Program Documents to which such
Liquidity Lender is a party;
(e) no Liquidity Participant, unless such Liquidity
Participant is an Affiliate of such Liquidity Lender, or is itself a
Liquidity Lender, shall be entitled to require such Liquidity Lender to
take or refrain from taking any action hereunder or under any other CP
Program Document, except that such Liquidity Lender may agree with any
Liquidity Participant that such Liquidity Lender will not, without such
Liquidity Participant's consent, take any actions of the type described
in the first proviso of Section 11.1(a) or clauses (i) through (vii)
and clauses (ix) and (x) of Section 11.1(a);
(f) DTFC shall not be required to pay any amount under this
Liquidity Agreement that is greater than the amount which it would have
been required to pay had no participating interest been sold; and
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<PAGE> 69
(g) such Liquidity Lender shall comply with any obligation to
withhold taxes or any filing or reporting requirements imposed under
Applicable Law relating to such Liquidity Participant and DTFC and
Liquidity Agent shall continue to deal solely and directly with such
Liquidity Lender in connection with such matters.
DTFC acknowledges and agrees that, to the extent permitted by Applicable Law,
each Liquidity Participant, subject to clauses (d) and (f) above, for purposes
of Sections 5.3, 5.4, 5.5, 5.6, 5.8, 11.3, 11.4, 11.13 and 11.16 shall be
considered a Liquidity Lender; provided, that no Liquidity Participant shall be
entitled to receive any greater payment under Section 5.3, 5.4 or 5.5 than the
Liquidity Lender that transferred such rights to such Liquidity Participant
would have been entitled to receive with respect to such rights, unless such
transfer is made with DTFC's prior written consent. No Liquidity Participant
shall have direct rights against DTFC.
SECTION 11.12. Other Transactions. Nothing contained herein shall
preclude the Liquidity Agent or any other Liquidity Lender from engaging in any
transaction, in addition to those contemplated by this Liquidity Agreement or
any other CP Program Document, with DTFC or any of its Affiliates in which DTFC
or such Affiliate is not restricted hereby from engaging with any other Person.
SECTION 11.13. Bankruptcy Petition Against DTFC. The Liquidity Agent
and each Liquidity Lender hereby covenants and agrees that, prior to the date
which is one year and one day after the payment in full of all Commercial Paper
Notes Outstanding, it will not institute against, or join any other Person in
instituting against, DTFC or RCFC, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other similar proceeding under the laws
of the United States or any state of the United States. In the event that any
Liquidity Lender takes action in violation of this Section 11.13, DTFC agrees,
for the benefit of the Holders, that it shall file an answer with the bankruptcy
court or otherwise properly contest the filing of such a petition by the
Liquidity Lender against DTFC or the commencement of such action and raise the
defense that such Liquidity Lender has agreed in writing not to take such action
and should be estopped and precluded therefrom and such other defenses, if any,
as its counsel advises that it may assert; and such Liquidity Lender acting in
violation of this Section 11.13 shall be liable for and pay the costs and
expenses of DTFC incurred in connection therewith. The provisions of this
Section 11.13 shall survive the termination of this Liquidity Agreement, and,
with respect to the Liquidity Agent, the resignation or removal of the Liquidity
Agent and, with respect to any Liquidity Lender, the replacement of such
Liquidity Lender.
SECTION 11.14. Limited Recourse to DTFC; No Recourse. (a) The Liquidity
Agent and each Liquidity Lender agree that the Obligations of DTFC to the
Liquidity Agent and such Liquidity Lender hereunder shall be payable in the
order and priority set forth in Section 2.01 and 5.02(b), as applicable, of the
Collateral Agreement. Such Obligations shall be due and
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<PAGE> 70
payable only to the extent that DTFC's Assets and the Series 1998-1 Letter of
Credit are sufficient to pay such Obligations. No claims of the Liquidity Agent
or any Liquidity Lender arising under or in connection with the Collateral
Agreement are intended to be impaired or waived by this Section 11.14(a).
(b) Without limitation to the Obligations of DTFC hereunder, no
recourse shall be had for the payment of any amount owing in respect of
Liquidity Advances or for the payment of any fee hereunder or any other
obligation or claim arising out of or based upon this Liquidity Agreement, the
Liquidity Advance Notes or any other CP Program Document against any
stockholder, employee, officer, director, Affiliate or incorporator of DTFC
based on their status as such or their actions in connection therewith. The
provisions of this Section 11.14(b) shall survive the termination of this
Liquidity Agreement, and with respect to the Liquidity Agent the resignation or
removal of the Liquidity Agent and with respect to any Liquidity Lender the
replacement of such Liquidity Lender.
SECTION 11.15. Survival of Representations and Warranties. All
covenants, agreements, representations and warranties made by DTFC herein and in
the certificates or other instruments prepared or delivered in connection with
or pursuant to this Liquidity Agreement or any other CP Program Document shall
be considered to have been relied upon by the Liquidity Lenders and shall
survive the execution and delivery of this Liquidity Agreement and the making by
the Liquidity Lenders of the Liquidity Advances, and the execution and delivery
to the Liquidity Lenders of the Liquidity Advance Notes evidencing such
Liquidity Advances, regardless of any investigation made by the Liquidity
Lenders or on their behalf and shall continue so long as and until such time as
all Obligations hereunder and all Indebtedness under the Commercial Paper Notes
shall have been paid in full and the Liquidity Lenders no longer have any
Liquidity Commitments hereunder.
SECTION 11.16. Confidentiality. Each Liquidity Lender agrees that it
shall not disclose any Confidential Information to any Person without the prior
written consent of DTFC or DTAG, other than (a) to the Liquidity Lender's
Affiliates and their officers, directors, employees, agents and advisors and to
actual or prospective assignees and participants, and then only on a
confidential basis, (b) as required by any law, rule or regulation or judicial
process of which DTFC or DTAG, as the case may be, has knowledge (and DTFC and
DTAG shall be deemed to have knowledge of any general requirement that a
Liquidity Lender disclose Confidential Information to bank examiners or other
regulatory agencies having jurisdiction over the Liquidity Lender); provided
that a Liquidity Lender may disclose Confidential Information as required by any
law, rule or regulation or judicial process of which DTFC or DTAG, as the case
may be, does not have knowledge if such Liquidity Lender is prohibited by law
from disclosing such requirement to DTFC or DTAG, as the case may be, or (c) in
the course of litigation with DTFC or DTAG, the Liquidity Agent or any other
Liquidity Lender.
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<PAGE> 71
"Confidential Information" means information that DTFC or DTAG
furnishes to a Liquidity Lender on a confidential basis, but does not include
any such information that is or becomes generally available to the public other
than as a result of a disclosure by any Liquidity Lender or other Person to
which a Liquidity Lender delivered such information or that is or becomes
available to such Liquidity Lender from a source other than DTFC or DTAG,
provided that such source is not (1) known to such Liquidity Lender to be bound
by a confidentiality agreement with DTFC or DTAG, as the case may be, or (2)
known to such Liquidity Lender to be otherwise prohibited from transmitting the
information by a contractual, legal or fiduciary obligation.
SECTION 11.17. Jurisdiction; Consent to Service of Process. ALL
JUDICIAL PROCEEDINGS BROUGHT AGAINST DTFC OR ANY LIQUIDITY LENDER WITH RESPECT
TO THIS LIQUIDITY AGREEMENT OR ANY OTHER CP PROGRAM DOCUMENT MAY BE BROUGHT IN
ANY STATE OR (TO THE EXTENT PERMITTED BY LAW) FEDERAL COURT OF COMPETENT
JURISDICTION IN THE STATE OF NEW YORK AND BY EXECUTION AND DELIVERY OF THIS
LIQUIDITY AGREEMENT, DTFC AND THE LIQUIDITY LENDERS EACH ACCEPTS FOR ITSELF AND
IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE
NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS, AND IRREVOCABLY AGREES TO BE
BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS LIQUIDITY
AGREEMENT. DTFC DESIGNATES AND APPOINTS CT CORPORATION, 1633 BROADWAY, NEW YORK,
NEW YORK 10019, AND EACH LIQUIDITY LENDER DESIGNATES AND APPOINTS ITS UNITED
STATES DOMESTIC OFFICE SPECIFIED ON THE SIGNATURE PAGES HEREOF, AND SUCH OTHER
PERSONS AS MAY HEREAFTER BE SELECTED BY DTFC OR SUCH LIQUIDITY LENDER
IRREVOCABLY AGREEING IN WRITING TO SERVE, AS ITS AGENT TO RECEIVE ON ITS BEHALF,
SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDINGS IN ANY SUCH COURT, SUCH SERVICE
BEING HEREBY ACKNOWLEDGED BY DTFC AND EACH LIQUIDITY LENDER TO BE EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT. A COPY OF SUCH PROCESS SO SERVED SHALL BE
MAILED BY REGISTERED MAIL TO DTFC OR SUCH LIQUIDITY LENDER SO SERVED AT ITS
ADDRESS PROVIDED IN THE APPLICABLE SIGNATURE PAGE HERETO, EXCEPT THAT, UNLESS
OTHERWISE PROVIDED BY APPLICABLE LAW, ANY FAILURE TO MAIL SUCH COPY SHALL NOT
AFFECT THE VALIDITY OF SERVICE OF PROCESS. IF ANY AGENT APPOINTED BY DTFC OR
SUCH LIQUIDITY LENDER REFUSES TO ACCEPT SERVICE, DTFC AND EACH LIQUIDITY LENDER
HEREBY AGREES THAT SERVICE UPON IT BY MAIL SHALL CONSTITUTE SUFFICIENT NOTICE.
NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF ANY
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<PAGE> 72
LIQUIDITY LENDER OR THE COLLATERAL AGENT TO BRING PROCEEDINGS AGAINST DTFC IN
THE COURTS OF ANY OTHER JURISDICTION.
SECTION 11.18. Waiver of Jury Trial. THE LIQUIDITY AGENT, THE LIQUIDITY
LENDERS AND DTFC HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS LIQUIDITY
AGREEMENT OR ANY OTHER CP PROGRAM DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE COLLATERAL
AGENT, THE LIQUIDITY LENDERS OR DTFC IN CONNECTION HEREWITH OR THEREWITH. DTFC
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION
FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH OTHER CP PROGRAM DOCUMENT
TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE
LIQUIDITY AGENT AND THE LIQUIDITY LENDERS ENTERING INTO THIS LIQUIDITY AGREEMENT
AND EACH SUCH OTHER CP PROGRAM DOCUMENT.
SECTION 11.19. Waiver of Set-Off. Each Liquidity Lender hereby waives
and relinquishes any right that it has or may have to set-off or to exercise any
banker's lien or any right of attachment or garnishment with respect to any
funds at any time and from time to time on deposit in, or otherwise to the
credit of, any account and any claims of DTFC therein or with respect to any
right to payment from DTFC, it being understood, however, that nothing contained
in this Section 11.19 shall, or is intended to, derogate from the assignment and
security interest granted to the Collateral Agent under the Collateral Agreement
or impair any rights of the Liquidity Lenders, the Liquidity Agent or the
Collateral Agent thereunder.
[Remainder of Page Intentionally Blank]
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<PAGE> 73
IN WITNESS WHEREOF, the parties hereto have caused this Liquidity
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.
DOLLAR THRIFTY FUNDING CORP.
By:
-------------------------------------
Name:
Title:
Address: 5330 East 31st Street
Tulsa, Oklahoma 74135
Attention: Michael H. McMahon
Facsimile No.: (918) 669-2925
Telephone No.: (918) 669-3914
CREDIT SUISSE FIRST BOSTON
as Liquidity Agent
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
Address: Eleven Madison Avenue
New York, New York 10010-3629
Attention: Asset Finance Department
Facsimile No.: (212) 325-6677
Telephone No.: (212) 325-9078
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<PAGE> 74
LIQUIDITY COMMITMENT LIQUIDITY LENDER
By:
-------------------------------------
Name:
Title:
Domestic
Office:
Attention:
Facsimile No.:
Telephone No.:
Eurodollar
Office:
Attention:
Facsimile No.:
Telephone No.:
-66-
<PAGE> 75
EXHIBIT A
TO THE
LIQUIDITY AGREEMENT
FORM OF LIQUIDITY ADVANCE NOTE
$[ ] March 4, 1998
FOR VALUE RECEIVED, the undersigned, DOLLAR THRIFTY FUNDING CORP., an Oklahoma
corporation ("DTFC"), promises to pay to the order of [ ] (the "Liquidity
Lender") for the account of its applicable lending office specified in the books
and records of the Liquidity Agent for Eurodollar Advances and Base Rate
Advances (as such terms are defined in the Liquidity Agreement referred to
below) the principal sum of [ ] DOLLARS ($[ ]) or, if less, the aggregate unpaid
principal amount of all Liquidity Advances shown on the schedule attached hereto
(and any continuation thereof) made by the Liquidity Lender pursuant to that
certain Liquidity Agreement, dated as of March __, 1998 (together with all
amendments, supplements, amendments and restatements and other modifications, if
any, from time to time thereafter made thereto in accordance with the terms
thereof, the "Liquidity Agreement"), among DTFC, the various financial
institutions (including the Liquidity Lender) as are or may become parties
thereto (collectively, the "Liquidity Lenders") and Credit Suisse First Boston,
as liquidity agent (in such capacity, the "Liquidity Agent") for the Liquidity
Lenders. Unless otherwise defined herein or the context otherwise requires,
terms used herein have the meanings provided in the Definitions List annexed as
Annex A to the Liquidity Agreement.
DTFC also promises to pay interest on the unpaid principal amount hereof from
time to time outstanding from the date hereof until maturity (whether by
acceleration or otherwise) and, after maturity, until paid, at the rates per
annum and on the dates specified in the Liquidity Agreement.
Payments of both principal and interest are to be made in lawful money of the
United States in same day or immediately available funds to the account
designated by the Liquidity Agent pursuant to the Liquidity Agreement.
This Liquidity Advance Note is one of the Liquidity Advance Notes referred to
in, and evidences indebtedness incurred under, the Liquidity Agreement, which
indebtedness is secured pursuant to the Collateral Agreement to which reference
is made for a description of the security for this Liquidity Advance Note, and
reference is made to the Liquidity Agreement
<PAGE> 76
for a statement of the terms and conditions on which DTFC is permitted and
required to make prepayments and repayments of principal of the Indebtedness
evidenced by this Liquidity Advance Note and on which such Indebtedness may be
declared to be immediately due and payable.
All parties hereto, whether as makers, endorsers, or otherwise, severally waive
presentment for payment, demand, protest and notice of dishonor.
-2-
<PAGE> 77
THIS LIQUIDITY ADVANCE NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL
BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
DOLLAR THRIFTY FUNDING CORP.
By:
-------------------------------------
Name:
Title:
-3-
<PAGE> 78
LOANS AND PRINCIPAL PAYMENTS
<TABLE>
<CAPTION>
========================================================================================================
Amount of Loan Amount of Principal Unpaid Principal
Made Repaid Balance
----------------- ------------------- ----------------
Euro- Interest Euro- Euro-
Base dollar Period (if Base dollar Base dollar Notation
Date Rate Rate applicable) Rate Rate Rate Rate Total Made By
========================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
========================================================================================================
</TABLE>
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<PAGE> 79
EXHIBIT B
TO THE
LIQUIDITY
AGREEMENT
FORM OF BORROWING REQUEST
Credit Suisse First Boston
as Liquidity Agent
Eleven Madison Avenue
New York, New York 10010-3629
Attention: [ ]
Re: Dollar Thrifty Funding Corp.
Gentlemen and Ladies:
This Borrowing Request is delivered to you pursuant to Section[s]
[3.6.1] [3.6.2] of that certain Liquidity Agreement, dated as of March 4, 1998
(as amended, supplemented, amended and restated or otherwise modified from time
to time in accordance with the terms thereof or, the "Liquidity Agreement"),
among Dollar Thrifty Funding Corp. ("DTFC"), an Oklahoma corporation, certain
financial institutions as are or may become parties thereto (collectively, the
"Liquidity Lenders") and Credit Suisse First Boston, as liquidity agent (in such
capacity, the "Liquidity Agent") for the Liquidity Lenders. Unless otherwise
defined herein or the context otherwise requires, terms used herein have the
meanings provided in the Definitions List annexed as Annex A to the Liquidity
Agreement.
DTFC hereby requests that a [Refunding] [Swing Line] Advance be made in
the aggregate principal amount of $_________ on _____________, 19__ as a [Base
Rate Advance] [Eurodollar Advance] having an Interest Period of __ month(s)].
DTFC agrees that if prior to the time of the Borrowing requested hereby
any matter certified to herein by it will not be true and correct at such time
as if then made, it will immediately so notify the Liquidity Agent. Except to
the extent, if any, that prior to the time of the Borrowing requested hereby the
Liquidity Agent shall receive written notice to the contrary from DTFC, each
matter certified to herein shall be deemed once again to be certified as true
and correct at the date of such Borrowing as if then made.
<PAGE> 80
Please wire transfer the proceeds of the Borrowing to the accounts of
the following persons at the financial institutions indicated respectively:
Person to be Paid
Amount to be Names Address, etc. Account No.
Transferred Name of Transferee Lender
$
----------- ---------------------------------- -------------------------
----------------------------------
Attention:
----------------------------------------------------
$
----------- ---------------------------------- -------------------------
----------------------------------
Attention:
----------------------------------------------------
Balance of DTFC
such proceeds ------------------------ -------------------------
----------------------------------
Attention:
----------------------------------------------------
-2-
<PAGE> 81
[DTFC] or [_____________, as Attorney-in-Fact for DTFC],has caused this
Borrowing Request to be executed and delivered, and the certification and
warranties contained herein to be made, by its duly Authorized Officer this ____
day of __________, 19__.
DOLLAR THRIFTY FUNDING CORP.
By
---------------------------------------
Name:
Title:
-3-
<PAGE> 82
EXHIBIT C
TO THE
LIQUIDITY
AGREEMENT
FORM OF CONTINUATION/CONVERSION NOTICE
Credit Suisse First Boston
as Liquidity Agent
Eleven Madison Avenue
New York, New York 10010-3629
Attention: [ ]
DOLLAR THRIFTY FUNDING CORP.
Gentlemen and Ladies:
This Continuation/Conversion Notice is delivered to you pursuant to Section
3.8 of that certain Liquidity Agreement, dated as of March 4, 1998 (as amended,
supplemented, amended and restated or otherwise modified from time to time in
accordance with the terms thereof, the "Liquidity Agreement"), among Dollar
Thrifty Funding Corp., an Oklahoma corporation ("DTFC"), the various financial
institutions as are or may become parties thereto (collectively, the "Liquidity
Lenders") and Credit Suisse First Boston as liquidity agent (in such capacity,
the "Liquidity Agent") for the Liquidity Lenders. Unless otherwise defined
herein or the context otherwise requires, terms used herein have the meanings
provided in the Definitions List, annexed as Annex A to the Liquidity Agreement.
DTFC hereby requests that on ____________, 19__,
(1) $ of the presently outstanding principal amount of
the [Refunding] [Swing Line] Advances originally made
on ____________, 19__, which are presently being
maintained as [Base Rate Advances] [Eurodollar
Advances],
(2) be [converted into] [continued as],
<PAGE> 83
(3) [Base Rate Advances having an Interest Period of
______] [Eurodollar Advances having an Interest
Period of ______].
(1) DTFC hereby:
(a) certifies and warrants that no Liquidity Agreement
Amortization Event has occurred and is continuing;
and
(b) agrees that if prior to the time of such continuation
or conversion any matter certified to herein by it
will not be true and correct in all material respects
at such time as if then made, it will immediately so
notify the Liquidity Agent.
Except to the extent, if any, that prior to the time of the continuation or
conversion requested hereby the Liquidity Agent shall receive written notice to
the contrary from DTFC, each matter certified to herein shall be deemed to be
certified at the date of such continuation or conversion as if then made.
DTFC has caused this Continuation/Conversion Notice to be executed and
delivered, and the certification and warranties contained herein to be made, by
its Authorized Officer this ___ day of __________________, 19__.
DOLLAR THRIFTY FUNDING CORP.
By:
-------------------------------------
Name:
Title:
- --------
(1) Use only if converting into or continuing as Eurodollar Advances.
-2-
<PAGE> 84
EXHIBIT D
TO THE
LIQUIDITY
AGREEMENT
FORM OF LIQUIDITY LENDER ASSIGNMENT AGREEMENT
To: Dollar Thrifty Funding Corp.
5330 East 31st Street
Tulsa, Oklahoma 74135
Attention:
Credit Suisse First Boston,
as Liquidity Agent
Eleven Madison Avenue
New York, New York 10010-3629
Attention:
DOLLAR THRIFTY FUNDING CORP.
Gentlemen and Ladies:
We refer to that certain Liquidity Agreement, dated as of March 4, 1998
(as such agreement may be amended, supplemented, amended and restated or
otherwise modified from time to time in accordance with the terms thereof, the
"Liquidity Agreement"), among Dollar Thrifty Funding Corp., an Oklahoma
corporation ("DTFC"), certain financial institutions as are or may become
parties thereto (collectively, the "Liquidity Lenders") and Credit Suisse First
Boston, as liquidity agent (in such capacity the "Liquidity Agent") for the
Liquidity Lenders. As used in this letter unless the context requires a
different meaning, capitalized terms not otherwise defined herein shall have the
meanings assigned to such terms in the Definitions List, annexed to the
Liquidity Agreement as Annex A thereto, as in effect on the date thereof and as
such Annex A may be amended, supplemented or otherwise modified in accordance
with the terms of the Liquidity Agreement.
This liquidity agreement is delivered to you pursuant to clause (a) of
Section 11.11.1 of the Liquidity Agreement, and constitutes notice to each of
you, of the assignment and delegation to _______________ (the "Assignee") of
___% (which is $_________) of the Liquidity Commitment of _____________ (the
"Assignor") and $________ of the Liquidity Advances of the Assignor (such
assigned Liquidity Commitment and Liquidity Advances being collectively referred
to herein as the "Assigned Share"), outstanding under the Liquidity
<PAGE> 85
Agreement on the date hereof. After giving effect to the foregoing assignment
and delegation, (i) the Liquidity Commitments of the Assignor and the Assignee
for the purposes of the Liquidity Agreement shall be as set forth on the
signature pages hereof and (ii) the Assignor shall be in compliance with the
requirements of Section 11.11.1.
The Assignee hereby acknowledges and confirms that (i) it has received
a copy of the Liquidity Agreement and the exhibits related thereto, together
with copies of the documents which were required to be delivered under the
Liquidity Agreement as a condition to the making of the effectiveness thereof
and (ii) it has made, independently and without reliance upon the Assignor, the
Liquidity Agent or any Liquidity Lender, and based upon such financial
statements and other documents and information as it has deemed appropriate, its
own credit analysis and decision to enter into this Liquidity Lender Assignment
Agreement. The Assignee further confirms and agrees that in becoming a Liquidity
Lender and in making its Liquidity Commitment and Liquidity Advances under the
Liquidity Agreement, such actions have and will be made without recourse to, or
representation or warranty by, the Liquidity Agent or any other Liquidity
Lender.
Except as otherwise provided in the Liquidity Agreement, effective upon
the date the Liquidity Agent accepts the Liquidity Lender Assignment Agreement
(the "Assignment Effective Date"),
(a) the Assignee
(i) shall be deemed automatically to have become a
party to the Liquidity Agreement and to have all the rights
and obligations of a "Liquidity Lender" under the Liquidity
Agreement and the other CP Program Documents as if it were an
original signatory thereto or beneficiary thereof to the
extent of the Assigned Share; and
(ii) agrees to be bound by the terms and conditions
set forth in the Liquidity Agreement and the other CP Program
Documents as if it were an original signatory thereto;
(b) the Assignor shall be released from its obligations under
the Liquidity Agreement and the other CP Program Documents to the
extent of the Assigned Share; and
(c) the Liquidity Agent shall make all payments in respect of
the Assigned Share (including, without limitation, all payments of
principal, interest and commitment fees with respect thereto) to the
Assignee.
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The Assignee and the Assignor will make all appropriate adjustments
with respect to the payment of all accrued and unpaid interest on the Liquidity
Advances prior to the Assignment Effective Date pursuant to the terms of a
separate agreement between the Assignor and the Assignee.
The Assignor and the Assignee hereby agree that the [Assignor]
[Assignee] will pay to the Liquidity Agent the processing fee referred to in
Section 11.11.1 of the Liquidity Agreement upon the delivery hereof.
The Assignee hereby advises each of you of the following administrative
details with respect to the assigned Commitment and Liquidity Advances and
requests the Liquidity Agent to acknowledge receipt of this document:
(A) Address for Notices:
Institution Name:
Attention:
Domestic Office:
Telephone:
Facsimile:
Eurodollar Office:
Telephone:
Facsimile:
(B) Payment Instructions:
The Assignee agrees to furnish the tax form(s) required by Section 5.6
(if so required) of the Liquidity Agreement no later than the date of acceptance
hereof by the Liquidity Agent.
This Liquidity Agreement may be executed by the Assignor and Assignee
in separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.
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<PAGE> 87
Adjusted Liquidity Commitment and
Amount of Liquidity Advances
[ASSIGNOR]
Commitment
$_________ By:_______________________
Title:
[ASSIGNEE]
Commitment
$_________ By:_______________________
Title:
Acknowledged and Agreed:
CREDIT SUISSE FIRST BOSTON,
as Liquidity Agent
By:___________________________
Name:
Title:
DOLLAR THRIFTY FUNDING CORP.
By:___________________________
Name:
Title:
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<PAGE> 88
EXHIBIT E
TO THE
LIQUIDITY AGREEMENT
FORM OF DOLLAR THRIFTY FUNDING CORP.
CLOSING DATE CERTIFICATE
The undersigned, the ____________ of Dollar Thrifty Funding Corp., an
Oklahoma corporation ("DTFC"), pursuant to Section 6.1.11 of that certain
Liquidity Agreement, dated as of March 4, 1998 (the "Liquidity Agreement"),
among DTFC, certain financial institutions which are or may become party thereto
and Credit Suisse First Boston, as liquidity agent, does hereby certify that as
of the date hereof:
1. The representations and warranties of DTFC in each of the CP Program
Documents to which DTFC is a party are true and correct (in all material
respects to the extent such representations and warranties do not incorporate a
materiality limitation in their terms) on the date hereof as though made on and
as of the date hereof. DTFC has duly performed, in all material respects, all
obligations required to be performed by it on or prior to the date hereof, and
has satisfied, in all material respects, all conditions to be satisfied by it,
in each case, pursuant to the terms of each of the CP Program Documents to which
DTFC is a party.
2. No Liquidity Agreement Amortization Event, Limited Liquidity
Agreement Amortization Event or, to the best of the undersigned's knowledge,
Potential Liquidity Agreement Amortization Event, has occurred and is
continuing.
Capitalized terms used herein and not defined herein shall have the
meaning assigned to such terms in the Definitions List, annexed as Annex A to
the Liquidity Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
this __ day of March ___, 1998.
DOLLAR THRIFTY FUNDING CORP.
By:
-------------------------------------
Name:
Title:
<PAGE> 89
EXHIBIT F
TO THE
LIQUIDITY AGREEMENT
FORM OF LIQUIDITY COMMITMENT AGREEMENT
To: Dollar Thrifty Funding Corp.
5330 East 31st Street
Tulsa, Oklahoma 74135
Attention:
Credit Suisse First Boston
as Liquidity Agent
Eleven Madison Avenue
New York, New York 10010-3629
Attention:
DOLLAR THRIFTY FUNDING CORP.
Gentlemen and Ladies:
We refer to that certain Liquidity Agreement, dated as of March 4, 1998
(as such agreement may be amended, supplemented, amended and restated or
otherwise modified from time to time in accordance with the terms thereof, the
"Liquidity Agreement"), among Dollar Thrifty Funding Corp., an Oklahoma
corporation ("DTFC"), certain financial institutions as are or may become
parties thereto (collectively, the "Liquidity Lenders") and Credit Suisse First
Boston, as liquidity agent (in such capacity the "Liquidity Agent") for the
Liquidity Lenders. As used in this letter unless the context requires a
different meaning, capitalized terms not otherwise defined herein shall have the
meanings assigned to such terms in the Definitions List, annexed to the
Liquidity Agreement as Annex A thereto, as in effect on the date thereof and as
such Annex A may be amended, supplemented or otherwise modified from time to
time in accordance with the terms thereof.
This liquidity agreement is delivered to you pursuant to clause (b) of
Section 3.4 of the Liquidity Agreement, and constitutes notice to each of you,
of the [increase of the Liquidity Lender Commitment of ________ (the "Existing
Bank")] [addition of _________________ as an Eligible Liquidity Lender (the "New
Bank")]. The [Existing Bank] [New Bank] desires to assume a Liquidity Commitment
on the Commitment Effective Date (as defined below) such that after
<PAGE> 90
giving effect to the assumption hereinafter provided, the [Existing Bank] [New
Bank]'s Liquidity Commitment shall equal $ and its Percentage of the Aggregate
Liquidity Commitment (as such Aggregate Liquidity Commitment is increased by
such [increase in] [additional] Liquidity Commitment) shall equal % (such new
Liquidity Commitment is referred to herein as the "New Share"). After giving
effect to the [increase of the Existing Bank's Liquidity Commitment][addition of
the New Bank] the Liquidity Commitment of the [Existing Bank][New Bank] for the
purposes of the Liquidity Agreement shall be as set forth on the signature pages
hereof.
The [Existing Bank][New Bank] hereby acknowledges and confirms that (i)
it has received a copy of the Liquidity Agreement and the exhibits related
thereto, together with copies of the documents which were required to be
delivered under the Liquidity Agreement as a condition to the making of the
effectiveness thereof and (ii) it has made, independently and without reliance
upon the Liquidity Agent or any Liquidity Lender, and based upon such financial
statements and other documents and information as it has deemed appropriate, its
own credit analysis and decision to enter into this Liquidity Commitment
Agreement. The [Existing Bank][New Bank] further confirms and agrees that [by
increasing and making] [in becoming a Liquidity Lender and in making] its
Liquidity Commitment and Liquidity Advances under the Liquidity Agreement, such
actions have and will be made without recourse to, or representation or warranty
by, the Liquidity Agent or any other Liquidity Lender.
Except as otherwise provided in the Liquidity Agreement, effective upon
the date the Liquidity Agent and DTFC accept this Liquidity Commitment Agreement
(the "Commitment Effective Date"), the [Existing Bank][New Bank]:
(a) hereby assumes the New Share and shall be deemed automatically to
have become a party to the Liquidity Agreement and to have all the
rights and obligations of a "Liquidity Lender" under the Liquidity
Agreement and the other CP Program Documents as if it were an original
signatory thereto or beneficiary thereof to the extent of the New
Share; and
(b) agrees to be bound by the terms and conditions set forth in the
Liquidity Agreement and the other CP Program Documents as if it were an
original signatory thereto.
The [Existing Bank][New Bank] hereby agrees that the [Existing
Bank][New Bank] will pay to the Liquidity Agent the processing fee referred to
in Section 11.11.1 of the Liquidity Agreement upon the delivery hereof.
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<PAGE> 91
The [Existing Bank][New Bank] hereby advises each of you of the
following administrative details with respect to the [increase of the Existing
Banks Liquidity Commitment][addition of the New Bank] and requests the Liquidity
Agent to acknowledge receipt of this document:
(A) Address for Notices:
Institution Name:
Attention:
Domestic Office:
Telephone:
Facsimile:
Eurodollar Office:
Telephone:
Facsimile:
(B) Payment Instructions:
The [Existing Bank][New Bank] agrees to furnish the tax form(s)
required by Section 5.6 (if so required) of the Liquidity Agreement no later
than the date of acceptance hereof by the Liquidity Agent.
This Liquidity Agreement may be executed in separate counterparts, each
of which when so executed and delivered shall be deemed to be an original and
all of which taken together shall constitute one and the same agreement.
[Adjusted] Liquidity Commitment and [Existing Bank][New Bank]
Amount of Liquidity Advances
Commitment [Name of [Existing Bank] [New Bank]]
$_________ By: _______________________
Title:
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<PAGE> 92
Acknowledged and Agreed:
CREDIT SUISSE FIRST BOSTON, as Liquidity Agent
By:__________________________________
Name:
Title:
DOLLAR THRIFTY FUNDING CORP.
By:__________________________________
Name:
Title:
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<PAGE> 93
EXHIBIT G
TO THE
LIQUIDITY
AGREEMENT
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
Reference is made to the Liquidity Agreement (as amended, supplemented,
waived or otherwise modified from time to time, the "Liquidity Agreement"),
dated as of March 4, 1998 among Dollar Thrifty Funding Corp., an Oklahoma
corporation ("DTFC"), certain financial institutions as are or may become
parties thereto (collectively, the "Liquidity Lenders") and Credit Suisse First
Boston, as liquidity agent (in such capacity the "Liquidity Agent") for the
Liquidity Lenders. The undersigned hereby certifies that:
(1) The undersigned is the beneficial owner of the Liquidity Advance(s)
(as well as any Liquidity Advance Note(s) evidencing such Liquidity Advance(s))
registered in its name;
(2) The income from the Liquidity Advance(s) held by the undersigned is
not effectively connected with the conduct of a trade or business within the
United States; and
(3) The undersigned is not a bank (as such term is used in Section
881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the "Code")), is
not subject to regulatory or other legal requirements as a bank in any
jurisdiction, and has not been treated as a bank for purposes of any tax,
securities law or other filing or submission made to any governmental authority,
any application made to a rating agency or any qualification for any exemption
from any tax, securities law or other legal requirements.
We have furnished you with a certificate of our non-U.S. status on
Internal Revenue Service Form W-8. By executing this certificate, the
undersigned agrees that (1) if the information provided on this certificate
changes, the undersigned shall so inform DTFC (for the benefit of DTFC and the
Liquidity Agent) in writing within thirty days of such change and (2) the
undersigned shall furnish to DTFC (for the benefit of DTFC and the Liquidity
Agent) a properly completed and currently effective certificate in either the
calendar year in which payment is to be made by DTFC to the undersigned, or in
either of the two calendar years preceding such payment.
<PAGE> 94
Unless otherwise defined herein, terms defined in the Liquidity
Agreement or in the Definitions List attached as Annex A to the Liquidity
Agreement, as applicable, and used herein shall have the meanings given to them
in the Liquidity Agreement or in the Definitions List attached as Annex A to the
Liquidity Agreement, as applicable .
[NAME OF LIQUIDITY LENDER]
By:_______________
[Address]
Dated: __________, 199_
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<PAGE> 95
ANNEX A
TO THE
LIQUIDITY AGREEMENT
DEFINITIONS LIST
Dated as of March 4, 1998
"Accounts" is defined in Section 5.01 of the Collateral Agreement.
"Advance" has the meaning set forth in paragraph 2 of the preamble to
the Note Purchase Agreement.
"Affected Liquidity Lender" is defined in clause (a) of Section 5.9
of the Liquidity Agreement.
"Affiliate" means, with respect to any specified Person, another
Person that directly, or indirectly through one or more intermediaries, controls
or is controlled by or is under common control with the Person specified. For
purposes of this definition, "control" means (a) the power to direct the
management and policies of a Person, directly or indirectly, whether through
ownership of voting securities, by contract or otherwise or (b) beneficial
ownership of 10% or more of the voting common equity of a Person; and
"controlled" and "controlling" have meanings correlative to the foregoing.
"Aggregate Face Amount" means, on any date, with respect to
Commercial Paper Notes issued at a discount, the aggregate face amount of all
such Commercial Paper Notes Outstanding on such date and, with respect to
interest bearing Commercial Paper Notes, the aggregate face amount of all such
Commercial Paper Notes Outstanding on such date plus the accrued and unpaid
interest thereon and interest that will accrue prior to maturity.
"Aggregate Liquidity Commitment" means, as of any date of
determination, the sum of the Liquidity Lenders' Liquidity Commitments on such
date.
"Aggregate Outstanding CP" means, as of any date, the Aggregate Face
Amount of Commercial Paper Notes Outstanding on such date, net of any amounts on
deposit on such date in the Collateral Account and/or the Commercial Paper
Account and/or the Termination Advance Account, set aside for the repayment of
the principal of, or interest on, Commercial Paper Notes.
<PAGE> 96
"Aggregate Outstandings" means, as of any date, the sum of (i) the
aggregate principal amount of and accrued interest on all Liquidity Advances
Outstanding on such date, (ii) the aggregate principal amount of and accrued
interest on LOC Liquidity Disbursements Outstanding on such date and (iii) the
Aggregate Outstanding CP on such date, net of any amounts on deposit on such
date in the Collateral Account set aside for the repayment of the principal of,
or interest on, Liquidity Advances or LOC Liquidity Disbursements.
"Amortization Commencement Date" means the earlier to occur of (a)
the occurrence of a Liquidity Agreement Amortization Event described in Section
9.1.6 with respect to DTFC, or Section 9.1.11, in each case, of the Liquidity
Agreement, or (b) the date of declaration of the commencement of the
Amortization Period by written notice to DTFC pursuant to Section 9.2 of the
Liquidity Agreement.
"Amortization Period" means the period commencing on the Amortization
Commencement Date and ending on the date all Liquidity Commitments have been
terminated and all amounts due and payable to the Liquidity Agent, the Liquidity
Lenders, the Series 1998-1 Letter of Credit Provider (with respect to LOC Credit
Disbursements and LOC Liquidity Disbursements and other amounts payable by DTFC
to the Series 1998-1 Letter of Credit Provider under the CP Enhancement Letter
of Credit Application and Agreement) and the Holders with respect to the
Commercial Paper Notes have been paid in full.
"Applicable Law" means all applicable provisions of all (a)
constitutions, statutes, treaties, rules, regulations, requirements, ordinances
and orders of governmental bodies, (b) governmental approvals and (c) orders,
decisions, judgments and decrees of all courts and arbitrators.
"Assets" means any interest of any kind in any assets or property of
any kind, tangible or intangible, real, personal or mixed, now owned or
hereafter acquired by DTFC or such other Person as the context may require.
"Assigned Collateral" is defined in Section 4.01 of the Collateral
Agreement.
"Assignee Lender" is defined in Section 11.11.1 of the Liquidity
Agreement.
"Authorized Officer" means (a) those officers, employees and agents
of DTFC whose signatures and incumbency shall have been certified to the
Liquidity Agent and the Liquidity Lenders pursuant to Section 6.1.1 of the
Liquidity Agreement or in such other certificates as may be delivered by DTFC to
the Liquidity Agent and the Depositary from time to time as duly authorized to
execute and deliver the Liquidity Agreement, any other Liquidity Document and
any other CP Program Document to which DTFC is a party and any instruments or
documents in connection therewith on behalf of DTFC and to take, from time to
time, all other actions on behalf of DTFC in connection therewith.
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<PAGE> 97
"Authorized Representatives" is defined in Section 2 of the
Depositary Agreement.
"Authorized Signatories" is defined in Section 2 of the Depositary
Agreement.
"Base Rate" means, on any date and with respect to any Base Rate
Advance, a fluctuating rate of interest per annum equal to the higher of
(a) the Prime Rate for such day; and
(b) the Federal Funds Rate plus 0.50% per annum.
Changes in the rate of interest on that portion of any Liquidity Advance or LOC
Disbursement maintained as Base Rate Advances will take effect simultaneously
with each change in the Base Rate. The Liquidity Agent will give notice promptly
to DTFC, the Series 1998-1 Letter of Credit Provider and the Liquidity Lenders
of changes in the Base Rate.
"Base Rate Advance" means Liquidity Advance under the Liquidity
Agreement or an LOC Disbursement under the Series 1998-1 Letter of Credit
bearing interest at a fluctuating rate determined by reference to the Base Rate.
"Base Rate Tranche" means that portion of the Series 1998-1 Invested
Amount purchased or maintained with Advances which bear interest by reference to
the Base Rate.
"Book Entry CP Holder" is defined in Section 6(e) of the Depositary
Agreement.
"Book Entry CP Notes" is defined in Section 6(a) of the Depositary
Agreement.
"Book Entry Issuance Instruction" is defined in Section 3(a)(ii) of
the Depositary Agreement.
"Book Entry Procedures" is defined in Section 6(a) of the Depositary
Agreement.
"Borrowing" means the Liquidity Advances of the same type and, in the
case of Eurodollar Advances, having the same Interest Period, and either (i)
made by all Liquidity Lenders on the same Business Day pursuant to the same
Borrowing Request in accordance with Section 3.1.1 of the Liquidity Agreement or
(ii) made by the Swing Line Lender pursuant to a Borrowing Request in accordance
with Section 3.1.2 of the Liquidity Agreement.
"Borrowing Base" means, as of any date of determination, an amount
equal to the sum of (without duplication): (a) the Series 1998-1 Invested Amount
as of such date, plus (b) in the case of that portion, if any, of the principal
amount of the Series 1998-1 Notes funded by Commercial Paper Notes, interest
accrued and unpaid as of such date on such portion and
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<PAGE> 98
interest that will accrue through the maturity date of the Commercial Paper
Notes issued to fund such portion of such principal amount, plus (c) in the case
of that portion, if any, of the principal amount of the Series 1998-1 Notes not
funded by Commercial Paper Notes, interest accrued and unpaid on such portion of
such principal amount as of such date, plus (d) the outstanding principal amount
of Eligible Investments and cash (other than any amounts on deposit on such date
in the Series 1998-1 Collection Account or the Collateral Account, in each case
to the extent such amounts shall have been set aside for the repayment of the
principal of, or interest on, Liquidity Advances, LOC Liquidity Disbursements or
Commercial Paper Notes) then held by the Trustee in the Series 1998-1 Collection
Account and the Collateral Agent in the Collateral Account.
"Borrowing Base Deficiency" means, with respect to any date of
determination, the amount by which the Aggregate Outstandings on such date
exceeds the Borrowing Base on such date.
"Borrowing Request" means a request and certificate for Liquidity
Advances, substantially in the form of Exhibit B to the Liquidity Agreement.
"Business Day" means
(a) any day other than a Saturday, Sunday or other day on
which banks are authorized or required by law to be closed in New
York, New York; and
(b) relative to the making, continuing, prepaying or
repaying of Eurodollar Advances, any day on which dealings in Dollars
are carried on in the London interbank market.
"Certificated Notes" is defined in Section 2 of the Depositary
Agreement.
"Closing Date" means the date the Liquidity Agreement becomes
effective in accordance with its terms and the Series 1998-1 Letter of Credit is
issued.
"Closing Date Certificate" means a certificate, substantially in the
form of Exhibit E to the Liquidity Agreement, duly completed and executed by an
Authorized Officer of DTFC, addressed to the Liquidity Lenders, the Liquidity
Agent, the Depositary and the Series 1998-1 Letter of Credit Provider.
"Collateral Account" is defined in Section 5.01 of the Collateral
Agreement.
"Collateral Agent" means Bankers Trust Company in its capacity as
collateral agent under the Collateral Agreement, and any successor thereto.
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<PAGE> 99
"Collateral Agreement" means the Collateral Agreement, dated as of
March 4, 1998, among DTFC, the Collateral Agent, the Liquidity Agent, the
Depositary, CSFB, in its capacity as a dealer, and the Series 1998-1 Letter of
Credit Provider, as such agreement may be amended, supplemented, restated or
otherwise modified from time to time in accordance with the terms thereof and of
the Liquidity Agreement.
"Commercial Paper Account" is defined in Section 2.4 of the Liquidity
Agreement.
"Commercial Paper Deficit" is defined in Section 3.6.1(a) of the
Liquidity Agreement.
"Commercial Paper Notes" means the promissory notes of DTFC issued by
DTFC in the commercial paper market pursuant to the Depositary Agreement.
"Commitment Fee" is defined in Section 4.5(a) of the Liquidity
Agreement.
"Commitment Termination Date Liquidity Advance" means a Liquidity
Advance made by a Liquidity Lender on the Scheduled Liquidity Commitment
Termination Date with respect to such Liquidity Lender, pursuant to Section
3.6.3 of the Liquidity Agreement.
"Confidential Information" (a) for purposes of the Liquidity
Agreement, has the meaning specified in Section 11.16 of the Liquidity Agreement
and (b) for purposes of the Note Purchase Agreement, has the meaning set forth
in Section 8.11 of the Note Purchase Agreement.
"Consolidated Subsidiary" means, at any time, with respect to DTAG,
any Subsidiary or other entity the accounts of which are consolidated with those
of DTAG, in its consolidated financial statements as of such time.
"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate, duly executed by an Authorized Officer of DTFC,
substantially in the form of Exhibit C to the Liquidity Agreement.
"CP Borrowing Base" means, as of any date of determination, an amount
equal to (i) the Borrowing Base as of such date, (ii) plus any amounts on
deposit in the Series 1998-1 Pledge Account on such date, (iii) minus, as of
each Payment Date, the Series 1998-1 Invested Percentage (as defined in the
Series 1998-1 Supplement) (for allocations with respect to Losses) of the amount
owed by any Manufacturer under an Eligible Vehicle Disposition Program with
respect to Program Vehicles leased under the Master Lease that remained unpaid
more than ten (10) days but less than or equal to one hundred (100) days after
the Due Date as of the last day of the Related Month.
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<PAGE> 100
"CP Borrowing Base Deficiency" means, with respect to any date of
determination, the amount by which the Aggregate Outstanding CP on such date
exceeds the CP Borrowing Base on such date.
"CP Market Disruption Event" means, at any time for any reason
whatsoever, DTFC shall be unable to raise, or shall be precluded or prohibited
from raising, funds through the issuance of Commercial Paper Notes in the United
States' commercial paper market at such time.
"CP Memorandum" means the private placement memorandum currently in
use by the Dealers and approved by DTAG for the offer and sale of Commercial
Paper Notes.
"CP Program Documents" means the Depositary Agreement, the Collateral
Agreement, the Dealer Agreement, the Liquidity Agreement, the Series 1998-1
Letter of Credit, the CP Enhancement Letter of Credit Application and Agreement
and the CP Memorandum, as such documents may be amended, modified or
supplemented.
"CP Rate" means, for any Fixed Period, if DTFC funds the Series
1998-1 Invested Amount of the Series 1998-1 Notes for such Fixed Period through
the issuance of Commercial Paper Notes, a rate per annum to be calculated by
DTFC equal to the sum of (i) the rate (or, if more than one rate, the weighted
average of the rates) at which Commercial Paper Notes having a term equal to
such Fixed Period and issued to fund the Series 1998-1 Notes may be sold by any
placement agent or commercial paper dealer selected by the Collateral Agent, as
notified by the Collateral Agent to the Master Servicer, provided that if such
rate is a discount rate (or rates), then such rate shall be the rate (or
weighted average of the rates, as applicable) resulting from converting such
discount rate (or rates) to an interest-bearing equivalent rate per annum; plus
(ii) .05%.
"CP Stop Issuance Event" means (i) a Lease Event of Default under
Section 17.1 of the Lease or (ii) an Amortization Event under Article 5 of the
Series 1998-1 Supplement.
"CP Tranche" means that portion of the Series 1998-1 Invested Amount
purchased or maintained with Advances which bear interest by reference to the CP
Rate.
"Credit Agreement" means the Credit Agreement, dated as of December
23, 1997, among DTAG, Dollar and Thrifty, as borrowers, the financial
institutions from time to time party thereto, as lenders, CSFB, as
administrative agent for the lenders, The Chase Manhattan Bank, as syndication
agent for the lenders, and CSFB and Chase Securities Inc. as co- arrangers, as
the same may be amended, supplemented, restated or otherwise modified from time
to time in accordance with its terms.
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<PAGE> 101
"CSFB" means Credit Suisse First Boston, a banking corporation
established under the laws of Switzerland.
"DCR" means Duff & Phelps Credit Rating Co.
"Dealer" means Credit Suisse First Boston Corporation, a
Massachusetts corporation, or Chase Securities Inc., a Delaware corporation, and
any successor thereto or any additional dealer executing the Dealer Agreement.
"Dealer Agreement" means the Dealer Agreement, dated as of March 4,
1998, among the Dealers and DTFC, as amended, supplemented, restated or
otherwise modified from time to time in accordance with its terms.
"Definitions List" means this Definitions List, as the same may be
amended, restated, supplemented or otherwise modified from time to time in
accordance with the terms of the Liquidity Agreement.
"Depositary" means Bankers Trust Company, or such other banking
institution as DTFC shall appoint, with the prior written consent of the
Required Liquidity Providers (which consent shall not be unreasonably withheld
or delayed), as issuing and paying agent for Commercial Paper Notes under the
Depositary Agreement and as agent for the Holders.
"Depositary Agents" means those officers, employees and agents of the
Depositary whose signatures and incumbency shall have been certified to the
Collateral Agent pursuant to clause (b) of Section 3.01 of the Collateral
Agreement or in such other certificates as may be delivered by the Depositary to
the Collateral Agent from time to time as duly authorized to act, and to give
instructions and notices, on behalf of the Depositary, under the Collateral
Agreement.
"Depositary Agreement" means the Depositary Agreement, dated as of
March 4, 1998, between DTFC and the Depositary, as amended, supplemented,
restated or otherwise modified from time to time in accordance with its terms.
"Depositary Incumbency Certificate" is defined in Section 3.01(b) of
the Collateral Agreement.
"Deposited Funds" is defined in Section 5.01 of the Collateral
Agreement.
"Designated Persons" is defined in Section 2 of the Depositary
Agreement.
"DCR" means Duff & Phelps Credit Rating Co.
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"Dollar" and the symbol "$" mean the lawful currency of the United
States.
"Domestic Office" shall mean, relative to any Liquidity Lender or the
Series 1998-1 Letter of Credit Provider, as the case may be, the office of such
Liquidity Lender or the Series 1998-1 Letter of Credit Provider, as the case may
be, designated as such below its signature to the Liquidity Agreement or the
Credit Agreement, as applicable, or such other office of such Liquidity Lender
or Series 1998-1 Letter of Credit Provider, as the case may be, within the
United States as may be designated from time to time by notice from such
Liquidity Lender or the Series 1998-1 Letter of Credit Provider, as the case may
be, to each other Person party to the Liquidity Agreement or the Credit
Agreement, as applicable.
"DTAG" means Dollar Thrifty Automotive Group, Inc., a Delaware
corporation, and its permitted successors.
"DTC" means The Depository Trust Company.
"DTFC" means Dollar Thrifty Funding Corp., an Oklahoma corporation.
"DTFC Agent" means those officers, employees and agents of DTFC whose
signatures and incumbency shall have been certified to the Collateral Agent
pursuant to clause (a) of Section 3.01 of the Collateral Agreement or in such
other certificates as may be delivered by DTFC to the Collateral Agent from time
to time as duly authorized to act, and to give instructions and notices, on
behalf of DTFC, under the Collateral Agreement.
"DTFC Agreements" means the Series 1998-1 Notes, the Series 1998-1
Supplement, the Liquidity Agreement, and any other CP Program Document to which
DTFC is a party.
"DTFC Obligations" is defined in Section 2.01 of the Collateral
Agreement.
"Due Date" means, with respect to any payment due from a Manufacturer
or auction dealer in respect of a Program Vehicle disposed of pursuant to the
terms of the related Vehicle Disposition Program, the thirtieth (30th) day after
the Disposition Date for such Vehicle.
"Eligible Investments" means
(a) Government Obligations;
(b) Participation certificates (excluding strip mortgage
securities which are purchased at prices exceeding their principal
amounts) and senior debt obligations of the Federal Home Loan
Mortgage Corporation, consolidated system wide bonds and notes of the
Farm Credit System, senior debt obligations and mortgage-backed
securities (excluding stripped mortgage securities which are
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purchased at prices exceeding their principal amounts) of the Federal
Mortgage Association which, in the case of mortgage-backed
securities, are rated at least AA by S&P and Aa by Moody's, senior
debt obligations (excluding securities that have no fixed value
and/or whose terms do not promise a fixed dollar amount at maturity
or call date) of the Student Loan Marketing Association and debt
obligations of the Resolution Funding Corp. (collectively, "Agency
Obligations");
(c) Direct obligations of any state of the United States
of America or any subdivision or agency thereof whose short-term
unsecured general obligation debt has ratings from S&P of at least
A-1 and Moody's of at least P-1 or any obligation that has ratings
from S&P and Moody's at least equivalent to A-1 and P-1,
respectively, and which is fully and unconditionally guaranteed by
any state, subdivision or agency whose short term, unsecured general
obligation debt has ratings from S&P and Moody's at least equivalent
to A-1 and P-1, respectively;
(d) Commercial paper maturing in not more that three
hundred sixty-five (365) days and having ratings from S&P and Moody's
at least equivalent to A-1 and P-1, respectively;
(e) Deposits (including Eurodollar time deposits), federal
funds or bankers acceptances (maturing in not more that three hundred
sixty-five (365) days) of any domestic bank (including a branch
office of a foreign bank which branch office is located in the United
States), which:
(i) has an unsecured, uninsured and
unguaranteed obligation which has ratings from S&P and
Moody's at least equivalent to A-1 and P-1, respectively,
or
(ii) is the lead bank of a parent bank holding
company with an uninsured, unsecured and unguaranteed
obligation meeting the rating requirements in (i) above;
(f) Deposits of any bank or savings and loan association
which has combined capital, surplus and undivided profits of not less
than $100 million, provided such deposits are fully insured by the
Federal Deposit Insurance Corporation, the Banking Insurance Fund or
the Savings Association Insurance Fund;
(g) Investments in a money-market fund which may be a
12b-1 fund as registered under the Investment Company Act and is
rated at least the equivalent of AAm or AAm-G by S&P and P-1 by
Moody's;
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(h) Repurchase agreements with a term of six (6) months or
less with any institution having short-term, unsecured debt rated at
least the equivalent of A-1 by S&P and P-1 by Moody's;
(i) Repurchase agreements collateralized by Government
Obligations or Agency Obligations (the "Collateral Securities") with
any registered broker-dealer which is under the jurisdiction of the
Securities Investors Protection Corp. or any commercial bank, if such
broker-dealer or bank has uninsured, unsecured and unguaranteed debt
rated at least the equivalent of A-1 by S&P and P-1 by Moody's,
provided that:
(A) a master repurchase agreement or
other specific written repurchase
agreement governs the transaction;
(B) the Collateral Securities are held
free and clear of any other lien by
the Collateral Agent or an
independent third party acting
solely as agent for the Collateral
Agent, provided that any such third
party (A) is (1) a Federal Reserve
bank, (2) a bank which is a member
of the Federal Deposit Insurance
Corporation and which has combined
capital, surplus and undivided
profits of not less than $25
million, or (3) a bank approved in
writing for such purpose by the
Required Liquidity Providers, and
(B) certifies in writing to the
Collateral Agent (or delivers to the
Collateral Agent a written opinion
of counsel to such third party) that
such third party holds the
Collateral Securities free and clear
of any lien, as agent for the
Collateral Agent;
(C) a perfected first security interest
under the Uniform Commercial Code is
created in, or book entry procedures
prescribed at 31 C.F.R. 306.1 et
seq. or 31 C.F.R. 350.0 et seq. are
followed with respect to, the
Collateral Securities for the
benefit of the Collateral Agent;
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(D) such repurchase agreement has a term
of thirty (30) days or less, or the
Collateral Agent will value the
Collateral Securities no less
frequently than monthly and will
liquidate the Collateral Securities
if any deficiency in the required
collateral percentage is not
restored within two (2) business
days of such valuation;
(E) such repurchase agreement matures
(or permits the Collateral Agent to
withdraw all or any portion of the
invested funds) at least ten (10)
days (or other appropriate
liquidation period) prior to each
Payment Date;
(F) the fair market value of the
Collateral Securities in relation to
the amount of the repurchase
obligation, including principal and
interest, is equal to at least one
hundred and three percent (103%);
and
(G) the Collateral Agent obtains an
opinion of counsel to such
broker-dealer or bank to the effect
that such repurchase agreement is a
legal, valid, binding and
enforceable agreement of such
broker-dealer or bank (and, in the
case of a bank which is a branch of
a foreign bank, of such foreign
bank) in accordance with its terms;
and
(j) Other investment instruments approved in writing by
the Majority Banks and offered by financial institutions that have a
combined capital and surplus and undivided profits of not less than
$250,000,000 and with respect to which the Collateral Agent shall
have received written confirmation of the Rating Agencies that
inclusion of any such investment instrument as an Eligible Investment
will not result in the downgrading or withdrawal of the then current
ratings of the Commercial Paper Notes by the Rating Agencies.
"Eligible Liquidity Lender" means (a) a commercial bank having total
assets in excess of $500,000,000, (b) a finance company, insurance company or
other financial institution that in the ordinary course of business enters into
transactions of a type similar to that entered into
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by the Liquidity Lenders under the Liquidity Agreement and has total assets in
excess of $200,000,000, and whose becoming an assignee would not constitute a
prohibited transaction under Section 4975 of ERISA and (c) any other financial
institution satisfactory to DTFC, the Series 1998-1 Letter of Credit Provider
and the Liquidity Agent, in each case having a short-term rating or an
equivalent long-term debt rating from S&P, Moody's and DCR (if rated by DCR) at
least equal to the then current rating of the Commercial Paper Notes, but in any
event not less than a rating of A-1 by S&P, P-1 by Moody's and D-1 by DCR (if
rated by DCR); provided, however, that any Person who does not have either a
short-term rating from S&P, Moody's or DCR (if applicable) shall be deemed to
have the required rating set forth above if such Rating Agency confirms in
writing that such Person, if its short-term debt obligations were rated, would
be assigned such required rating.
"Eurodollar Advance" means a Liquidity Advance under the Liquidity
Agreement or LOC Liquidity Disbursement bearing interest, at all times during
the Interest Period applicable thereto at a fixed rate of interest determined by
reference to the Eurodollar Rate (Reserve Adjusted).
"Eurodollar Office" means, relative to any Reference Lender,
Liquidity Lender, the Collateral Agent or Series 1998-1 Letter of Credit
Provider, as the case may be, the office of such Reference Lender, Liquidity
Lender, the Collateral Agent or Series 1998-1 Letter of Credit Provider, as the
case may be, designated as such below its signature to the Liquidity Agreement
or the CP Enhancement Letter of Credit Application and Agreement, respectively,
or such other office of such Reference Lender, Liquidity Lender, the Collateral
Agent or Series 1998-1 Letter of Credit Provider, as the case may be, as
designated from time to time by notice from such Reference Lender, Liquidity
Lender, the Collateral Agent or Series 1998- 1 Letter of Credit Provider, as the
case may be, to DTFC and the Liquidity Agent, whether or not outside the United
States, which shall be making or maintaining Eurodollar Advances of such
Reference Lender, Liquidity Lender or Series 1998-1 Letter of Credit Provider,
as the case may be, under the Liquidity Agreement or the Series 1998-1 Letter of
Credit, respectively.
"Eurodollar Rate" means, relative to any Fixed Period, an interest
rate per annum equal to the average (rounded upward to the nearest whole
multiple of 1/100 of 1% per annum, if such average is not such a multiple) of
the rates per annum at which deposits in U.S. Dollars in immediately available
funds are offered by the Eurodollar Office of Credit Suisse First Boston in
London, England to prime banks in the London interbank market at or about 11:00
a.m. (London, England time) two Business Days before the first day of such Fixed
Period in an amount substantially equal to the amount of the [Eurodollar
Tranche] to be outstanding during such Fixed Period and for a period equal to
such Fixed Period.
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"Eurodollar Rate (Reserve Adjusted)" means, for any Fixed Period, an
interest rate per annum (rounded upward to the nearest 1/100th of 1%) determined
pursuant to the following formula:
Eurodollar Rate = Eurodollar Rate
-------------------------
+ 0.75
(Reserve Adjusted) 1.00 - Eurodollar Reserve
Percentage
"Eurodollar Reserve Percentage" means, for any Fixed Period, the
reserve percentage (expressed as a decimal) equal to the maximum aggregate
reserve requirements (including all basic, emergency, supplemental, marginal and
other reserves and taking into account any transitional adjustments or other
scheduled changes in reserve requirements) specified under regulations issued
from time to time by the F.R.S. Board and then applicable to assets or
liabilities consisting of and including "Eurocurrency Liabilities", as currently
defined in Regulation D of the F.R.S. Board, having a term approximately equal
or comparable to such Fixed Period.
"Eurodollar Tranche" means that portion of the Series 1998-1 Invested
Amount purchased or maintained with Advances which bear interest by reference to
the Eurodollar Rate.
"Event of Bankruptcy" shall be deemed to have occurred with respect
to a Person if either:
(a) a case or other proceeding shall be commenced, without
the application or consent of such Person, in any court, seeking the
liquidation, reorganization, debt arrangement, dissolution, winding
up, or composition or readjustment of debts of such Person, the
appointment of a trustee, receiver, custodian, liquidator, assignee,
sequestrator or the like for such Person or all or any substantial
part of its assets, or any similar action with respect to such Person
under any law relating to bankruptcy, insolvency, reorganization,
winding up or composition or adjustment of debts, and such case or
proceeding shall continue undismissed, or unstayed and in effect, for
a period of 60 consecutive days; or an order for relief in respect of
such Person shall be entered in an involuntary case under the federal
bankruptcy laws or other similar laws now or hereafter in effect; or
(b) such Person shall commence a voluntary case or other
proceeding under any applicable bankruptcy, insolvency,
reorganization, debt arrangement, dissolution or other similar law
now or hereafter in effect, or shall consent to the appointment of or
taking possession by a receiver, liquidator, assignee, trustee,
custodian, sequestrator (or other similar official) for such Person
or for any
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<PAGE> 108
substantial part of its property, or shall make any general
assignment for the benefit of creditors; or,
(c) in the case of a corporation or similar entity, its
board of directors shall vote to implement any of the actions set
forth in clause (b) above.
"Federal Funds Rate" means, for any day, the per annum rate set forth
in the weekly statistical release designated as H.15(519) or any successor
publication, published by the Federal Reserve Board for such day opposite the
caption "Federal Funds (Effective)"; provided, that if on any relevant date such
rate is not yet published in such release, then the Federal Funds Rate for such
day will be the weighted average of the rates on overnight funds transactions
with members of the Federal Reserve System published by the Federal Reserve Bank
of New York for such day; provided that if neither of the foregoing rates is
published for any day which is a Business Day, the Federal Funds Rate will be
the average of the quotations for transactions in overnight Federal funds
received on that day by the Collateral Agent from three federal funds brokers of
recognized standing selected by it.
"Fee Letter" means that certain fee letter dated November 19,1997
among DTAG, Dollar, Thrifty, Credit Suisse First Boston, The Chase Manhattan
Bank and Chase Securities Inc.
"Financial Officer" means, with respect to any corporation, the chief
financial officer, vice-president-finance, principal accounting officer,
controller or treasurer of such corporation.
"Financial Statements" has the meaning set forth in Section 5.02(b)
of the Note Purchase Agreement.
"Fixed Period" means a Series 1998-1 Interest Period (as defined in
the Series 1998-1 Supplement) provided that
(i) any Fixed Period in respect of which interest is
computed by reference to the CP Rate may be terminated at the
election of, and upon notice thereof to RCFC and the Servicer by, the
Collateral Agent any time upon the occurrence and during the
continuance of a CP Market Disruption Event;
(ii) if at any time any Fixed Period is terminated
pursuant to clause (i) above, the Series 1998-1 Invested Amount
previously allocated to such terminated Fixed Period shall be
allocated to a new Fixed Period to commence on such date and end on
the next succeeding Payment Date; and
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<PAGE> 109
(iii) upon the occurrence and during the continuance of a
Series 1998-1 Rapid Amortization Period, any Fixed Period in respect
of which interest is computed by reference to the CP Rate or the
Eurodollar Rate may be terminated at the election of, and upon notice
thereof to RCFC and the Servicer by, the Collateral Agent, and
interest on the applicable CP Tranches and Eurodollar Tranches shall
form part of the Base Rate Tranche for the remainder of such Fixed
Period and each Fixed Period commencing thereafter until payment in
full of the Series 1998-1 Notes.
"F.R.S. Board" means the Board of Governors of the Federal Reserve
System or any successor thereto.
"GAAP" means the generally accepted accounting principles promulgated
or adopted by the Financial Accounting Standards Board and its predecessors and
successors from time to time.
"Government Obligations" means direct obligations of, or obligations
the timely payment of principal of and interest on which is fully and
unconditionally guaranteed by, the United States of America and U.S. Treasury
REFCORPS.
"Governmental Authority" means any Federal, state, local or foreign
court or governmental department, commission, board, bureau, agency, authority,
instrumentality or other administrative or regulatory body.
"Guarantor" is defined in the preamble to the Master Lease.
"herein", "hereof", "hereto", "hereunder" and similar terms contained
in any CP Program Document refer to such CP Program Document as a whole and not
to any particular Section, paragraph or provision of such CP Program Document.
"Holder" means the holder from time to time of any Commercial Paper
Note.
"including" means including without limiting the generality of any
description preceding such term, and, for purposes of each CP Program Document,
the parties thereto agree that the rule of ejusdem generis shall not be
applicable to limit a general statement, which is followed by or referable to an
enumeration of specific matters, to matters similar to the matters specifically
mentioned.
"Incumbency Certificate" is defined in Section 2 of the Depositary
Agreement.
"Indemnified Liabilities" is defined for purposes of the Liquidity
Agreement in Section 11.4 thereof.
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<PAGE> 110
"Indemnified Parties" is defined in Section 11.4 of the Liquidity
Agreement.
"Indebtedness", as applied to any Person, means, without duplication,
(a) all indebtedness for borrowed money, (b) that portion of obligations with
respect to any lease of any property (whether real, personal or mixed) that is
properly classified as a liability on a balance sheet in conformity with GAAP,
(c) notes payable and drafts accepted representing extensions of credit whether
or not representing obligations for borrowed money, (d) any obligation owed for
all or any part of the deferred purchase price for property or services, which
purchase price is (i) due more than six months from the date of incurrence of
the obligation in respect thereof or (ii) evidenced by a note or similar written
instrument, (e) all indebtedness secured by any Lien on any property or asset
owned by that Person regardless of whether the indebtedness secured thereby
shall have been assumed by that Person or is nonrecourse to the credit of that
Person and (f) all Contingent Obligations of such Person in respect of any of
the foregoing.
"Independent Director" means a director who is not, and never was,
(a) a stockholder, director, officer, employee, affiliate, associate, advisor or
supplier of goods or services exceeding One Hundred Thousand Dollars
($100,000.00) annually (a "Supplier") of, or any person that has received any
benefit (excluding, however, any compensation received by the Independent
Director, in such person's capacity as such Independent Director and any benefit
received by an affiliate or associate of such person where there was no direct
benefit received by such person) in any form whatsoever from, or any person that
has provided any service (excluding, however, any service provided by the
Independent Director, in such person's capacity as such Independent Director and
service provided by an affiliate or associate of such person where there was no
direct or personal service provided by such person) in any form whatsoever to,
DTAG or any of its affiliates or associates, or (b) any person owning
beneficially, directly or indirectly, any outstanding shares of common stock of
DTAG or any of its affiliates, or a stockholder, director, officer, employee,
affiliate, associate, or Supplier of, or any person that has received any
benefit (excluding, however, any compensation received by the Independent
Director, in such person's capacity as such Independent Director) in any form
whatsoever from, or any person that has provided any service (excluding,
however, any service provided by the Independent Director, in such person's
capacity as such Independent Director) in any form whatsoever to, such
beneficial owner or any of such beneficial owner's affiliates or associates,
provided that ownership comprising up to one percent (1%) of an Independent
Director's net worth, from time to time, of any class of stock of DTAG, so long
as it remains listed on a national securities exchange, shall not prevent an
individual from meeting the requirements of Article SIXTH of DTFC's Certificate
of Incorporation, and provided further that indirect stock ownership of DTAG or
any of its affiliates by any person through a mutual fund or similar diversified
investment pool shall not disqualify such person from being an Independent
Director unless such person maintains direct or indirect control of the
investment decisions of such mutual fund or similar diversified
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investment pool, or (c) a person related to any person referred to in clauses
(a) or (b), or (d) a trustee, conservator or receiver for DTAG or any of its
affiliates other than DTFC.
"Initial Advance" means the Advance made under the Liquidity
Agreement as part of the initial Borrowing.
"Interest Period" means, (a) with respect to any Eurodollar Advance,
a one-week (only in the case of Swing Line Advances), or a one-,two-, three- or
six-month period commencing on the date of such Eurodollar Advance, as selected
by DTFC in its Borrowing Request; and (b), with respect to any Base Rate
Advance, a period commencing on the date of such Base Rate Advance and ending on
a Business Day no later than 180 days after such date, as selected by DTFC in
its Borrowing Request; provided, however, that if any such period would
otherwise end on a day which is not a Business Day, the Interest Period shall
instead end on the next succeeding Business Day; and provided, further, that in
the case of the Interest Period for a Eurodollar Advance, if such extension
would cause the last day of such Interest Period to occur in the next following
calendar month, the last day of such Interest Period shall occur on the next
preceding Business Day.
"Issuer" means DTFC, in its capacity as the issuer under the
Depositary Agreement.
"L.A. Agents" means those officers, employees and agents of the
Liquidity Agent whose signatures and incumbency shall have been certified to the
Collateral Agent pursuant to Section 3.01(c) of the Collateral Agreement or in
such other certificates as may be delivered by the Liquidity Agent to the
Collateral Agent from time to time as duly authorized to act, and to give
instructions and notices, on behalf of the Liquidity Agent, under the Collateral
Agreement.
"Letter" is defined in Section 6(a) of the Depositary Agreement.
"Lien" means, when used with respect to any Person, any interest in
any real or personal property, asset or other right held, owned or being
purchased or acquired by such Person which secures payment or performance of any
obligation, and shall include any mortgage, lien, pledge, encumbrance, charge,
retained security title of a conditional vendor or lessor, or other security
interest of any kind, whether arising under a security agreement, mortgage,
lease, deed of trust, chattel mortgage, assignment, pledge, retention or
security title, financing or similar statement, or notice or arising as a matter
of law, judicial process or otherwise.
"Limited Liquidity Agreement Amortization Event" is defined in
Section 9.3 of the Liquidity Agreement.
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"Liquidation Event of Default" means (a) any event or condition with
respect to DTFC or the type described in Section 9.1.6 of the Liquidity
Agreement, (b) any event or condition with respect to DTFC pursuant to Section
9.1.1(b) of the Liquidity Agreement (but only if so declared with respect to
each Series 1998-1 Note by Liquidity Lenders evidencing commitments exceeding
75% of the aggregate liquidity commitment in respect of the Series 1998-1 Notes)
or (c) any "Liquidation Event of Default", as defined in the Series 1998-1
Supplement.
"Liquidity Advance" means any Refunding Advance, any Commitment
Termination Date Liquidity Advance or any Swing Line Advance, or any combination
thereof, as the context may require.
"Liquidity Advance Note" means, with respect to any Liquidity Lender,
a promissory note issued to such Liquidity Lender by DTFC, substantially in the
form of Exhibit A to the Liquidity Agreement, evidencing the Liquidity Advances
by such Liquidity Lender to DTFC, and all other promissory notes accepted from
time to time in substitution therefor or renewal thereof.
"Liquidity Agent" means CSFB, as agent for the Liquidity Lenders, or
such other Person as shall have subsequently been appointed as the successor
Liquidity Agent pursuant to Section 10.4 of the Liquidity Agreement.
"Liquidity Agent Incumbency Certificate" is defined in Section
3.01(c) of the Collateral Agreement.
"Liquidity Agreement" means the Liquidity Agreement, dated as of
March 4, 1998, among DTFC, the Liquidity Lenders and the Liquidity Agent, as
such agreement may be amended, supplemented, restated or otherwise modified from
time to time in accordance with the terms thereof.
"Liquidity Agreement Amortization Event" is defined in Section 9.1 of
the Liquidity Agreement.
"Liquidity Commitment" means, as to any Liquidity Lender, the amount
set forth on the signature pages of the Liquidity Agreement for such Liquidity
Lender as its Liquidity Commitment or set forth in its Liquidity Lender
Assignment Agreement, as such amount may be increased or decreased from time to
time pursuant to Section 3.3, 3.4, 5.9 or 11.11.1 of the Liquidity Agreement.
"Liquidity Commitment Agreement" means a Liquidity Commitment
Agreement substantially in the form of Exhibit F to the Liquidity Agreement.
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"Liquidity Commitment Termination Date" means the earlier to occur of
(a) the date on which the Aggregate Liquidity Commitment
has been terminated in full or reduced to zero pursuant to Section
3.3 or 9.2 of the Liquidity Agreement; and
(b) the Scheduled Liquidity Commitment Termination Date.
"Liquidity Deficiency" is defined in the Certificate of Liquidity
Demand attached as Annex B to the Series 1998-1 Letter of Credit.
"Liquidity Documents" means the Liquidity Agreement, the Liquidity
Advance Notes, any Borrowing Request, any Continuation/Conversion Notice, any
Liquidity Commitment Agreement, any Liquidity Lender Assignment Agreement, the
Closing Date Certificate, and each other agreement, instrument, certificate or
other document delivered in
connection therewith.
"Liquidity Lender Account" means the account established pursuant to
Section 5.01 of the Collateral Agreement.
"Liquidity Lender Assignment Agreement" means a Liquidity Lender
Assignment Agreement substantially in the form of Exhibit D to the Liquidity
Agreement.
"Liquidity Lenders" is defined in the preamble of the Liquidity
Agreement, and, unless otherwise indicated, shall include any Liquidity Lender
acting in the capacity of Swing Line Lender.
"Liquidity Participant" is defined in Section 11.11.2 of the
Liquidity Agreement.
"Majority Banks" means, at any time, Liquidity Lenders holding, in
the aggregate, Liquidity Commitments equaling or exceeding 66-2/3% of the
Aggregate Liquidity Commitment; provided, however, that any Liquidity Lender
that has defaulted in making a Liquidity Advance shall (if such default is then
continuing) be considered to have a Liquidity Commitment equal to its
unreimbursed Liquidity Advances; provided, further, that the Liquidity
Commitment of any Liquidity Lender whose Liquidity Commitment has been drawn,
terminated and not repaid shall equal the unpaid or unreimbursed balance of its
Liquidity Advances.
"Master Note" means the form of Commercial Paper Note attached to the
Depositary Agreement as Exhibit E thereto.
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"Material Adverse Effect" means, with respect to any occurrence,
event or condition:
(i) a material adverse effect on the financial
condition, business, assets, operations or business prospects of DTAG
and its Consolidated Subsidiaries taken as a whole, other than a
materially adverse effect on the business prospects of DTAG and its
Consolidated Subsidiaries taken as a whole that have similarly
affected DTAG's major competitors;
(ii) a materially adverse effect on the ability
of (a) DTAG to perform its material obligations under any of the CP
Program Documents or (b) DTFC to perform its material obligations
under any of the CP Program Documents; or
(iii) an adverse effect on (a) the
enforceability of the Master Lease or the Series 1998-1 Notes or (b)
on the priority or perfection of the Collateral Agent's or the
Trustee's Lien on a material portion of the Assigned Collateral or
the Group II Collateral.
"Moody's" means Moody's Investors Service, Inc.
"Note Purchase Agreement" means the Note Purchase Agreement dated as
of March 4, 1998 among RCFC, DTAG, as Servicer and DTFC, as Note Purchaser, as
the same may be amended, supplemented or otherwise modified from time to time in
accordance with the terms thereof.
"Note Purchase Commitment Amount" means, as to the Note Purchaser,
the dollar amount set forth under its name on the signature pages hereof.
"Note Purchaser" means DTFC, together with any successors and
assigns.
"Obligations" means all obligations (monetary or otherwise, including
fixed and contingent obligations) of DTFC arising under or in connection with
the Liquidity Agreement, the Liquidity Advance Notes, each other Liquidity
Document and the CP Enhancement Letter of Credit Application and Agreement.
"Offering Memorandum" means the offering memorandum of DTFC used by
DTFC and the Dealers from time to time in connection with the offering and sale
of the Commercial Paper Notes, as the same may be amended, supplemented or
modified.
"Officer's Certificate" means a certificate signed by an Authorized
Officer of DTFC or DTAG, as appropriate.
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"Organic Document" means, with respect to any Person, its certificate
or articles of incorporation, its bylaws and all shareholder agreements, voting
trusts and similar arrangements applicable to any of its authorized shares of
capital stock.
"Outstanding" means (a) with respect to Commercial Paper Notes, all
Commercial Paper Notes issued at any time under the Depositary Agreement, except
(i) Commercial Paper Notes which have been paid through the Depositary, (ii)
matured Commercial Paper Notes which have not been presented for payment but
funds for the payment of which are on deposit in the Commercial Paper Account
established with respect thereto and are available for payment of such
Commercial Paper Notes or (iii) matured Commercial Paper Notes with respect to
which a Borrowing Request has been honored but funds for the payment of which
have not yet been deposited in the Commercial Paper Account; (b) with respect to
Liquidity Advances and LOC Liquidity Disbursements, all Liquidity Advances or
LOC Liquidity Disbursements made or deemed made by the Liquidity Lenders or the
Series 1998-1 Letter of Credit Provider, as the case may be, pursuant to the
Liquidity Agreement or the Series 1998-1 Letter of Credit, and not repaid by
DTFC, except Liquidity Advances or LOC Liquidity Disbursements to be repaid from
the proceeds of Commercial Paper Notes being issued on the date of such
repayment; (c) with respect to LOC Credit Disbursements, all LOC Credit
Disbursements made or deemed made by the Series 1998-1 Letter of Credit Provider
pursuant to the Series 1998-1 Letter of Credit, and not repaid by the Lessees or
DTAG; (d) with respect to a LOC Termination Disbursement, the LOC Termination
Disbursement made or deemed to be made by the Series 1998-1 Letter of Credit
Provider pursuant to the Series 1998-1 Letter of Credit, and not repaid by DTFC,
the Lessees or DTAG; and (e) with respect to Base Rate Advances or Eurodollar
Advances, Base Rate Advances or Eurodollar Advances made or deemed to be made by
the Series 1998-1 Letter of Credit Provider and not repaid by DTFC, the Lessees
or DTAG.
"Overall Percentage" means, relative to any Liquidity Lender or the
Series 1998-1 Letter of Credit Provider, a fraction (expressed as a percentage),
the numerator of which is the Liquidity Commitment or the Series 1998-1 Letter
of Credit Commitment, respectively, of such Person, and the denominator of which
is the sum of the Aggregate Liquidity Commitment and the Series 1998-1 Letter of
Credit Commitment.
"Percentage" means, relative to any Liquidity Lender, a fraction
(expressed as a percentage) obtained by dividing (i) the Liquidity Commitment of
such Liquidity Lender by (ii) the Aggregate Liquidity Commitment.
"Permitted Liens" means: (i) Liens for current taxes not delinquent
or for taxes being contested in good faith and by appropriate proceedings, and
with respect to which adequate reserves have been established, and are being
maintained, in accordance with GAAP, and (ii) obligations not exceeding in the
aggregate an amount equal to 3/4 of 1% of the Program Size in effect from time
to time, secured by (a) Liens, including judgment liens, arising in the
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<PAGE> 116
ordinary course of business being contested in good faith and by appropriate
proceedings, and with respect to which adequate reserves have been established,
and are being maintained, in accordance with GAAP, or for sums not due, (b)
Liens incurred in the ordinary course of business in connection with worker's
compensation, unemployment insurance or benefits, and (c) mechanics',
materialmen's landlord's, warehousemen's and carrier's Liens, and other Liens
imposed by law, securing obligations arising in the ordinary course of business
that are not more than thirty days past due or are being contested in good faith
and by appropriate proceedings and with respect to which adequate reserves have
been established, and are being maintained, in accordance with GAAP and (iii)
Liens in favor of the holders of the Obligations.
"Potential Liquidity Agreement Amortization Event" means any
occurrence or event which, after notice or lapse of time or both, would
constitute a Liquidity Agreement Amortization Event.
"Prime Rate" means the rate of interest most recently announced by
CSFB at its Domestic Office as its "reference rate"; provided, however, that the
Prime Rate is not necessarily intended to be the lowest rate of interest
determined by CSFB in connection with extensions of credit.
"Program Size" means, as of any date of determination (a) the
Aggregate Liquidity Commitment on such date (or, if the Liquidity Commitments of
the Liquidity Lenders shall have been terminated pursuant to Section 9.2 of the
Liquidity Agreement, the Aggregate Liquidity Commitment in effect immediately
prior to such termination), plus (b) the stated amount of the Series 1998-1
Letter of Credit.
"Program Support Provider" means and includes any financial
institutions party to the Liquidity Agreement and any other or additional Person
now or hereafter extending credit or having a commitment to extend credit to or
for the account of, and to make purchases from, DTFC or issuing a letter of
credit or surety bond or other instrument to support any obligations arising
under or in connection with DTFC's securitization program.
"Rating Agencies" means, collectively, S&P, Moody's, DCR and any
other nationally recognized rating agency approved by the Liquidity Agent, the
Series 1998-1 Letter of Credit Provider, DTAG and the Required Liquidity
Providers.
"Rating Downgrade" means, with respect to any Person, that the
rating, if any, assigned to such Person's short-term unsecured debt securities
or short-term deposits by any Rating Agency shall be lower than the rating then
assigned by such Rating Agency to the Commercial Paper Notes, or in any event, a
rating lower than A-2 by S&P, P-2 by Moody's or D-1- by DCR (if such Person is
rated by DCR).
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<PAGE> 117
"Reference Lenders" means Credit Suisse First Boston and any other
commercial bank designated by DTFC and approved by the Liquidity Agent as
constituting a "Reference Lender" hereunder.
"Refunding Advance" is defined in Section 3.1.1 of the Liquidity
Agreement.
"Required Liquidity Providers" means, at any time, Liquidity Lenders
and Series 1998-1 Letter of Credit Provider holding, in the aggregate, Liquidity
Commitments and Series 1998-1 Letter of Credit Commitments, respectively, such
that the aggregate amount of such commitments equals or exceeds 66-2/3% of the
sum of the Aggregate Liquidity Commitment and the Series 1998-1 Letter of Credit
Commitment; provided, however, that any Liquidity Lender or Series 1998-1 Letter
of Credit Provider that has defaulted in making a Liquidity Advance or making
LOC Disbursement (if at such time such default is continuing), shall be
considered to have a Liquidity Commitment or Series 1998-1 Letter of Credit
Commitment equal to the unpaid or unreimbursed balance of its Liquidity Advances
or LOC Disbursements, as applicable; and provided, further, that the Liquidity
Commitment or Series 1998-1 Letter of Credit Commitment of any Liquidity Lender
or Series 1998-1 Letter of Credit Provider whose commitment has been drawn,
terminated and not repaid, shall equal the unpaid or unreimbursed balance of its
Liquidity Advances or LOC Disbursements, as applicable.
"S&P" means Standard & Poor's Ratings Services, a division of the
McGraw-Hill Companies, Inc.
"Scheduled Liquidity Agreement Amortization Event" means any
Liquidity Agreement Amortization Event set forth in Section 9.1.11 of the
Liquidity Agreement.
"Scheduled Liquidity Commitment Termination Date" means, for any
Liquidity Lender, March 4, 1999, as such date may be extended from time to time
pursuant to Section 3.5 of the Liquidity Agreement.
"Scheduled Maturity Date" means,
(i) except in the case of any Commitment
Termination Date Liquidity Advance, with respect to any Liquidity
Advances, the last day of the relevant Interest Period, but in any
event not later than, in the case of Liquidity Advances, the date
eighteen (18) months after the applicable Scheduled Liquidity
Commitment Termination Date; provided, however, that after the
occurrence of a Liquidity Agreement Amortization Event, the Scheduled
Maturity Date shall mean the date eighteen (18) months after the
Amortization Commencement Date; and
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<PAGE> 118
(ii) with respect to any Commitment
Termination Date Liquidity Advance, the date eighteen (18) months
after the date on which such Commitment Termination Date Liquidity
Advance is made.
"Secured Parties" is defined in Section 4.01 of the Collateral
Agreement.
"Series 1998-1 Pledge Account" is defined in Section 5.01 of the
Collateral Agreement.
"Shortfall" means (a) if a Borrowing Request is submitted for
Revolving Advances, the aggregate amount of the proposed Borrowing requested
with respect thereto in such Borrowing Request; provided, however, that such
Shortfall shall not exceed the aggregate principal amount of advances to be made
under the Series 1998-1 Notes on the date such Borrowing is to be made; or (b)
if a Borrowing Request is submitted for Refunding Advances, the aggregate amount
of the proposed Borrowing requested with respect thereto in such Borrowing
Request; provided, however, that such Shortfall shall not exceed the Commercial
Paper Deficit on the date such Borrowing is to be made.
"Specified Period" is defined in Section 5.10 of the Liquidity
Agreement.
"Swing Line Advance" means any Refunding Advance made pursuant to
Section 3.1.2 of the Liquidity Agreement by the Swing Line Lender, in its
capacity as the Swing Line Lender (or any successor thereto in such capacity).
"Swing Line Lender" means Credit Suisse First Boston, in its capacity
as swing line lender, or any successor thereto in such capacity.
"Taxes" has the meaning specified in Section 5.6 of the Liquidity
Agreement.
"Termination Advance Account" is defined in Section 5.01 of the
Collateral Agreement.
"Termination Demand" means a demand for LOC Termination Disbursement
under the Series 1998-1 Letter of Credit pursuant to a Certificate of
Termination Demand.
"type" means, relative to any Liquidity Advance under the Liquidity
Agreement or any Disbursement under the Series 1998-1 Letter of Credit, the
portion thereof, if any, being maintained as a Base Rate Advance or a Eurodollar
Advance.
"Upfront Fee" is defined in Section 4.5(b) of the Liquidity
Agreement.
"written" or "in writing" means any form of written communication,
including, without limitation, by means of telex, telecopier device, telegraph
or cable.
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<PAGE> 119
ANNEX B
TO THE
LIQUIDITY
AGREEMENT
Disclosure Materials
1. Registration Statement on Form S-1 of Dollar Thrifty Automotive
Group, Inc., Registration Number 333-39661, including all exhibits
and amendments thereto.
2. All information furnished to prepare, and the contents of, the
Confidential Memorandum of Dollar Thrifty Automotive Group, Inc.
dated November 1997 furnished to prospective participants in the
revolving credit facility and the liquidity facility.
3. Disclosure Schedule attached hereto as Annex B-1.
<PAGE> 1
EXHIBIT 4.16
[EXECUTION COPY]
================================================================================
DEPOSITARY AGREEMENT
dated as of March 4, 1998
between
DOLLAR THRIFTY FUNDING CORP.,
as Issuer
and
BANKERS TRUST COMPANY,
as Depositary
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
SECTION 1. Establishment of Accounts; Proceeds of Commercial Paper Notes . . . . . . . . . . . . . . . . . . . 2
SECTION 2. Commercial Paper Notes Delivered for Safekeeping . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 3. Issuance of Commercial Paper Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 4. Delivery of Commercial Paper Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 5. Payment of Commercial Paper Notes at Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 6. Book Entry Commercial Paper Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 7. Inspection of Documents by Commercial Paper Note Holders . . . . . . . . . . . . . . . . . . . . 13
SECTION 8. Expenses and Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 9. Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 10. Term and Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 11. Amendments and Modifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 12. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 13. Binding Effect; Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 14. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 15. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 16. Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 17. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 18. No Petition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 19. Duties and Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 20. No Recourse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 21. Limited Recourse to DTFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 22. Merger or Consolidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 23. Amortization Event . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 24. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 25. Waiver of Set-Off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 26. Additional Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Exhibit A - Form of Commercial Paper Note
Exhibit B - Form of Incumbency Certificate
Exhibit C - Reserved
Exhibit D - Form of DTC Letter of Representations
Exhibit E - Form of Commercial Paper Master Note
Exhibit F - Form of Note Direct
Exhibit G - Form of Fee Letter
</TABLE>
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<PAGE> 3
March 4, 1998
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attention: Corporate Trust and Agency Group / Commercial Paper Group
Re: Dollar Thrifty Funding Corp. - Commercial Paper
Ladies and Gentlemen:
This will confirm the arrangements made with Bankers Trust Company
(the "Depositary") by the undersigned, Dollar Thrifty Funding Corp. ("DTFC" or
the "Issuer"), whereby you have agreed to act as depositary for safekeeping of
certain short-term promissory notes of DTFC (the "Commercial Paper Notes") and
as issuing and paying agent on behalf of DTFC in connection with the issuance
and payment of the Commercial Paper Notes, and to undertake certain obligations
as described below on behalf of holders of the Commercial Paper Notes. The
Depositary has advised the undersigned that it has arranged for The Depository
Trust Company ("DTC" or the "Sub-Agent") to act as its sub-agent for certain
purposes of this Depositary Agreement (as amended, supplemented, amended and
restated or otherwise modified from time to time in accordance with the terms
hereof, this "Agreement").
The Commercial Paper Notes will be issued on the terms and subject to
the conditions set forth herein and pursuant to the Liquidity Agreement (as
such agreement may be amended, supplemented, amended and restated or otherwise
modified from time to time in accordance with its terms, the "Liquidity
Agreement"), dated as of March 4, 1998, among DTFC, certain financial
institutions as Liquidity Lenders (the "Liquidity Lenders") and Credit Suisse
First Boston, a Swiss banking corporation (the "Liquidity Agent"), and be
supported by the Series 1998-1 Letter of Credit. All capitalized terms used
herein and not otherwise defined herein shall have the meanings set forth for
such terms in Annex A to, or incorporated by reference in, the Liquidity
Agreement.
The Commercial Paper Notes will be entitled to the benefits of this
Agreement, the Liquidity Agreement, the Collateral Agreement, the Base
Indenture, the Series 1998-1 Supplement and the Series 1998-1 Letter of Credit.
<PAGE> 4
This Agreement will govern your rights, powers and duties as such
Depositary, issuing and paying agent and, in certain circumstances, as agent
with respect to the Commercial Paper Notes issued pursuant to this Agreement.
No implied covenants shall be read into this Agreement against you. You shall
have no liability to DTFC, any Liquidity Lender, the Credit Enhancer or the
Holder of any Commercial Paper Note for the performance of any of the terms of
the Liquidity Agreement, the Collateral Agreement, the Base Indenture, the
Series 1998-1 Supplement or the Series 1998-1 Letter of Credit except as
expressly provided herein.
SECTION 1. Establishment of Accounts; Proceeds of Commercial Paper
Notes. For the purposes of this Agreement and the Liquidity Agreement you have
established, in the name of DTFC for the exclusive benefit of the Holders, from
time to time, of the Commercial Paper Notes Outstanding, a segregated trust
account in the corporate trust department at Bankers Trust Company, Account No.
25291 (being referred to herein and in the Liquidity Agreement as the
"Commercial Paper Account") over which you shall have exclusive dominion and
control and the sole right of withdrawal. All proceeds of the sale on any day
of Commercial Paper Notes issued hereunder shall be deposited by you in the
Commercial Paper Account to the extent necessary to provide for the payment of
unpaid matured Commercial Paper Notes or Commercial Paper Notes maturing on
such day, whether or not presented to the Depositary for payment; the proceeds
in excess of the amount required to pay unpaid matured Commercial Paper Notes
or Commercial Paper Notes maturing on such day, whether or not presented to the
Depositary for payment, shall be remitted to the Collateral Agent for deposit
into the Collateral Account on such day. All funds at any time on deposit in
the Commercial Paper Account shall be held in trust by you for the exclusive
benefit of the Holders, from time to time, of the Commercial Paper Notes
Outstanding in accordance with the terms of this Agreement; and no application
shall be made of such funds except to repay advances by you made pursuant to
Section 5 hereof or to pay matured Commercial Paper Notes in accordance with
the terms hereof. DTFC shall have no legal, equitable or beneficial interest
in the Commercial Paper Account. You agree to give DTFC, the Liquidity Agent,
the Rating Agencies and the Dealers immediate notice if you receive written
notice that the Commercial Paper Account or any funds on deposit in the
Commercial Paper Account have become subject to any stay, writ, judgment,
warrant of attachment, execution or similar process.
SECTION 2. Commercial Paper Notes Delivered for Safekeeping. At any
time and from time to time during the term of this Agreement, DTFC may deliver
to your attention at your address set forth in Section 12, Commercial Paper
Notes in substantially the form of Exhibit A to this Agreement (the
"Certificated Notes") which shall be consecutively numbered and bear such other
identification as DTFC may deem appropriate and shall be manually signed or
signed in facsimile in such manner as is acceptable to you on behalf of DTFC by
an Authorized Signatory (as defined below) of DTFC (notwithstanding whether
such person shall thereafter cease to be an Authorized Signatory), but shall
otherwise be incomplete. The Depositary shall not have any responsibility to
DTFC to determine by what means a facsimile signature may have been affixed to
the Commercial Paper Notes or to determine whether any facsimile signature or
manual signature is genuine or if such facsimile signature or manual signature
resembles the specimen
-2-
<PAGE> 5
signature on file with the Depositary. Each Commercial Paper Note (including
any Master Note (as defined in Section 6(b) hereof)), or group of Commercial
Paper Notes at one time, delivered to you shall be accompanied by a letter from
DTFC identifying the Commercial Paper Note or Commercial Paper Notes
transmitted therewith, and you shall acknowledge receipt of such Commercial
Paper Note or Commercial Paper Notes on the copy of such letter or some other
form of written receipt deemed appropriate by you and DTFC at the time of
delivery to you of such Commercial Paper Note or Commercial Paper Notes.
Pending the issuance of Commercial Paper Notes as provided in Section 3 hereof,
all Commercial Paper Notes delivered to you shall be held by you for the
account of DTFC for safekeeping in accordance with the Depositary's customary
practices. DTFC shall bear the sole risk of wastage of Certificated Notes as a
result of administrative or operational errors during the process of their
completion pursuant to this Agreement, other than errors attributable to the
Depositary's gross negligence or willful misconduct. DTFC shall maintain with
the Depositary at all times a supply of Certificated Notes sufficient to enable
the Depositary to perform the operations contemplated by this Agreement. The
Depositary shall forward to DTFC the original and all copies of any matured,
spoiled, mutilated, or incorrectly completed Certificated Note, properly
canceled.
Prior to the issuance of any Commercial Paper Notes, DTFC will furnish
to you, and from time to time hereafter may furnish to you, a certificate
(substantially in the form of Exhibit B hereto) (hereinafter called an
"Incumbency Certificate") of the Secretary or an Assistant Secretary of DTFC,
identifying and certifying the incumbency and specimen signatures of (i) the
officers or agents ("Authorized Signatories") of DTFC authorized to execute
Commercial Paper Notes (including the Master Notes) on behalf of DTFC, and (ii)
the officers or agents ("Authorized Representatives") of DTFC who are otherwise
authorized to act and give instructions and notices on behalf of DTFC
hereunder. Until you receive a subsequent Incumbency Certificate, or unless a
Designated Person (as defined below) shall have actual knowledge of the lack of
authority of any individual, you shall be entitled to rely on the last such
Incumbency Certificate delivered to you for purposes of determining Authorized
Signatories and Authorized Representatives.
For purposes of this Agreement, you hereby acknowledge that any
Managing Director, Vice President, Assistant Vice President, Assistant
Secretary or Assistant Treasurer of your Corporate Trust and Agency Group in
New York, New York, shall be authorized to act hereunder on your behalf as a
designated person (each, a "Designated Person") and to receive notices and
instructions delivered hereunder.
SECTION 3. Issuance of Commercial Paper Notes. (a) From time to
time during the term of this Agreement, and upon your timely receipt of written
(including electronically transmitted writings) or telephonic instructions
(subject to written confirmation, in the case of telephonic instructions, as
provided in paragraph (b) of this Section 3) in respect of any Commercial Paper
Note, not later than 1:00 p.m. (New York City time) on the date of issuance
thereof from an Authorized Representative, you shall: (i) in the case of
Certificated Notes,
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<PAGE> 6
withdraw designated Commercial Paper Notes from safekeeping and, in accordance
with the instructions received, take the following action with respect to each
such Certificated Note:
(A) date each such Certificated Note the date of issuance
thereof (which shall be a Business Day) and insert (w) the maturity
date thereof (which shall be a Business Day and which shall not be
later than (i) three Business Days prior to the earliest of the
Scheduled Liquidity Commitment Termination Date and the Series 1998-1
Letter of Credit Expiration Date in effect on the date of issuance
thereof and (ii) the 58th day following the date of issuance thereof),
(x) the face amount (which shall be at least $100,000 and an integral
multiple of $1,000 thereafter) thereof in figures and, if so directed
by an Authorized Representative, strike the word "Bearer" (if
applicable) and insert the name, address and taxpayer identification
number of the payee thereof (y) the Cusip Number and (z) the issue
price (for discounted notes) or the interest rate (for interest
bearing notes);
(B) authenticate each such Certificated Note by
countersigning it for authentication in the space provided thereon;
(C) deliver each such Certificated Note to the Dealer
specified in such instructions, or to the applicable Holder if any,
designated by such Dealer for the account of such Dealer against
receipt of payment of the amount set forth in the instructions of DTFC
delivered in respect thereof as provided in Section 4 hereof; and
(D) send a copy of each such Certificated Note to DTFC, and
upon written request therefor to the Liquidity Agent and the
Collateral Agent on or promptly following the date of issuance
thereof; and
(ii) in the case of Book Entry CP Notes (as defined in Section 6 hereof),
enter an issuance instruction (a "Book Entry Issuance Instruction") in the book
entry system of DTC in accordance with the Book Entry Procedures (as defined in
Section 6 hereof), which instruction shall provide the issuance information set
forth in clause (i) above with respect to such Book Entry CP Notes and specify
the party to whom such Book Entry CP Notes shall be issued.
Notwithstanding the foregoing, no Commercial Paper Note shall be
issued hereunder if,
(A) DTFC and the Depositary have received written
instructions then in effect from the Liquidity Agent (copies of which
will also be sent to the Dealer), given in accordance with Section 2.1
of the Liquidity Agreement not to issue or deliver Commercial Paper
Notes because (i) DTFC shall have terminated the Aggregate Liquidity
Commitment pursuant to Section 3.3 of the Liquidity Agreement, (ii)
the Aggregate Liquidity Commitment is otherwise terminated in whole
for any reason in accordance with the Liquidity Agreement, (iii) the
Commercial Paper Account or any funds on
-4-
<PAGE> 7
deposit in, or otherwise to the credit of, the Commercial Paper
Account are or have become subject to any stay, writ, judgment,
warrant of attachment, execution or similar process; provided,
however, that if any such stay, writ, judgment, warrant or attachment,
execution or similar process is removed or dismissed, DTFC may
recommence the issuance and sale of Commercial Paper Notes, or (iv)
any other condition precedent to issuance in Section 2.1 of the
Liquidity Agreement shall not have been met,
(B) after giving effect to such issuance and the use of
the proceeds thereof, the sum of the Aggregate Outstanding CP and the
aggregate principal amount of all Liquidity Advances Outstanding
would, net of any amounts on deposit at such time in the Collateral
Account and the Series 1998-1 Collection Account set aside for the
repayment of the principal of Liquidity Advances, exceed the Aggregate
Liquidity Commitment plus the Series 1998-1 Letter of Credit Amount
(which determination shall be made by the Depositary by reference to
the information to be set forth in the report referred to below),
(C) after giving effect to such issuance and the use of
proceeds thereof, the Aggregate Outstandings would exceed the CP
Borrowing Base,
(D) you shall have received written notice that any
condition precedent specified in Section 2.2 of the Liquidity
Agreement with respect to such issuance has not been satisfied,
(E) you shall have received written notice that any
Liquidity Agreement Amortization Event or any Limited Liquidity
Agreement Amortization Event as specified in Sections 9.2 and 9.4 of
the Liquidity Agreement has occurred, or
(F) you shall have received notice that any of the
Accounts (as defined in Section 5.01 of the Collateral Agreement) or
the Series 1998-1 Cash Collateral Account is subject to any stay,
writ, judgment, warrant of attachment, execution or other similar
process as specified in Section 5.01 of the Collateral Agreement.
In this connection the Collateral Agent will provide you at the opening of
business on each such day of issuance with a report based on information as of
the immediately preceding Business Day as to the aggregate principal amount of
all Liquidity Advances Outstanding and interest accrued thereon and the
information required to make the determinations set forth in clauses (B) and
(C) above, and the Series 1998-1 Letter of Credit Amount and the CP Borrowing
Base or any change in any of such amounts, and satisfaction of the conditions
precedent referred to in clause (D) above, and at the time of delivering or
issuing Commercial Paper Notes you may rely on the last such report so received
in determining the amount of Commercial Paper Notes that may then be issued.
In addition, if the Collateral Agent is unable to obtain such information
electronically from the Depositary or the Dealers and the Collateral Agent has
requested such notification, you shall notify the Collateral Agent on each day
of the Aggregate Face Amount of Commercial Paper Notes Outstanding as reflected
by your records. The Depositary shall make such
-5-
<PAGE> 8
information electronically or otherwise available to DTFC, the Collateral Agent
and the Liquidity Agent. The Depositary shall also make available to DTFC
pursuant to "Noteline Direct" under the terms specified in Exhibit F hereto the
information required by DTFC for purposes of calculating the CP Rate. If any
information required to be provided by the Collateral Agent hereunder is not
available to the Collateral Agent, DTFC agrees to provide such information to
the Collateral Agent to the extent DTFC possesses such information.
(b) No Commercial Paper Note will be authenticated and delivered, and
no Book Entry Issuance Instruction shall be given, by you unless you shall have
received, in your reasonable judgment, complete instructions from an Authorized
Representative as to the matters specified above in clause (i)(A) and clause
(ii) of paragraph (a) of this Section 3 and, in the case of Certificated Notes
as specified above in clause (i)(A) and (C) of paragraph (a) of this Section 3.
Any instructions given to you by an Authorized Representative to authenticate
and deliver Certificated Notes or to enter a Book Entry Issuance Instruction
hereunder shall constitute a representation and warranty on the part of DTFC
that (i) such Commercial Paper Note is the valid, enforceable and binding
obligation of the Issuer; (ii) such Commercial Paper Note is being issued in a
transaction exempt from registration under the Securities Act of 1933, as
amended, and any applicable state securities law; (iii) the issuance of such
Commercial Paper Notes will not violate or contravene any applicable law, rule,
regulation, order or contractual agreement binding upon DTFC (including, as
appropriate and without limitation, any securities law or law pertaining to
investment companies or any order of any court, governmental agency or
regulatory authority) and will be in conformity with the terms hereof and of
the Liquidity Agreement and all such Commercial Paper Notes are legal, valid
and binding and enforceable against DTFC in accordance with their terms.
Notwithstanding any instructions received by you from an Authorized
Representative, you shall not deliver Commercial Paper Notes or enter any Book
Entry Issuance Instruction on any date pursuant to such instructions if a
Designated Person shall receive by 9:00 a.m. (New York City time) on such date
written instructions from the Liquidity Agent pursuant to Section 2.1(a) of the
Liquidity Agreement instructing the Depositary not to deliver Commercial Paper
Notes or to enter Book Entry Issuance Instructions, until such written
instructions from the Liquidity Agent are revoked or superseded by further
instructions from the party originally giving the same.
Any telephonic or electronic instructions given to you by an
Authorized Representative shall be confirmed in writing or electronically by
such Authorized Representative within twenty-four hours after the same are
received by you, and you shall incur no liability for acting in accordance with
any such telephonic instructions reasonably believed by you in good faith to
have been given by an Authorized Representative.
DTFC is granted a personal, non-transferable and non-exclusive right
to use the instruction and reporting communication service Noteline Direct
("Noteline Direct") to transmit through the Noteline Direct system instructions
made pursuant to Section 3 hereof. DTFC may,
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by separate agreement between DTFC and one or more of the Dealers (each, an
"Agent"), authorize the Agent(s) to access Noteline Direct directly for the
purposes of transmitting instructions to you or obtaining reports with respect
to the Commercial Paper Notes.
DTFC acknowledges that (a) some or all of the services utilized in
connection with Noteline Direct are furnished by Digital Transactions Inc.
("DTI"), Dynamic Microprocessor Associates Inc. ("DMA") and Bankers Trust
Company, (b) Noteline Direct is provided to DTFC "AS IS" without warranties or
representations of any kind whatsoever by DTI, DMA or you, and (c) Noteline
Direct is proprietary and confidential property disclosed to DTFC in confidence
and only on the terms and conditions and for the purposes set forth in this
Agreement.
By this Agreement, DTFC acquires no title, ownership or sublicensing
rights whatsoever in Noteline Direct or in any trade secret, trademark,
copyright or patent of your bank, DTI, or DMA now or to become applicable to
Noteline Direct. DTFC may not transfer, sublicense, assign, rent, lease,
convey, modify, translate, convert to a programming language, decompile,
disassemble, recirculate, republish or redistribute Noteline Direct for any
purpose without your prior written consent and, where necessary, DTI and DMA
(except for the access to Noteline Direct by the Agent(s) as provided in this
section).
In the event (a) any action is taken or threatened which may result in
a disclosure or transfer of Noteline Direct or any part thereof, other than as
authorized by this Agreement, or (b) the use of any trademark, trade name,
service mark, service name, copyright or patent of your bank, DTI or DMA by
DTFC amounts to unfair competition, or otherwise constitutes a possible
violation of any kind, then you, DTI and DMA shall each have the right to take
any and all action deemed necessary to protect their rights in Noteline Direct,
and to avoid the substantial and irreparable damage which would result from
such disclosure, transfer or use, including the immediate termination of DTFC's
right to use Noteline Direct.
To permit the use of Noteline Direct to issue instructions or obtain
reports with respect to the Commercial Paper Notes, you will supply DTFC with
an identification number and initial passwords. From time to time thereafter,
DTFC will keep all information relating to its identification number and
passwords strictly confidential and will be responsible for the maintenance of
adequate security over its customer identification number and passwords. For
security purposes, DTFC should change its passwords frequently (at least once a
year).
Instructions transmitted over Noteline Direct and received by you
pursuant to Section 3 hereof accompanied by DTFC's identification number and
the passwords, shall be deemed conclusive evidence that such instructions are
correct and complete and that the issuance or redemption of the Note(s)
directed thereby has been duly authorized by DTFC.
SECTION 4. Delivery of Commercial Paper Notes. No Certificated Note
shall be delivered by you to any Dealer or the applicable investor except
against receipt therefor. A Certificated Note shall be deemed delivered
against receipt for purposes of this Section 4 if the
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net proceeds of such Certificated Note are received by you in immediately
available funds at the time of your delivery of such Certificated Note to any
Dealer or the applicable Holder or if, at the time you deliver such
Certificated Note to such Dealer or such Holder you receive such Dealer's
receipt for the delivery in customary form. In accordance with the custom in
the commercial paper market, delivery of such receipt shall obligate such
Dealer to deliver or cause to be delivered to you the purchase price of such
Certificated Notes in immediately available funds prior to your close of
business on such day. Should you deliver any Certificated Notes against
receipt as provided in the second sentence of this Section 4 you shall have no
responsibility or liability for the credit risks involved in your delivery of
such Certificated Notes to those persons who shall be designated by an
Authorized Representative or for the failure of such persons to effectuate
payment therefor as herein contemplated. It is understood that, as a matter of
bookkeeping convenience, the Depositary may credit the Commercial Paper Account
with the proceeds of Commercial Paper Notes prior to its actual receipt of
final payment therefor and that such bookkeeping credits may be reflected on
the Depositary's books, and otherwise, as "immediately available funds" or
"same day funds" or by some other similar characterization. Notwithstanding
any such credit or characterization, all such credits shall be conditioned upon
the Depositary's receipt of final payment and may be reversed by the Depositary
to the extent that such final payment is not received. DTFC agrees to
indemnify and hold the Depositary (which, for purposes of this sentence shall
include its directors, officers, employees and agents) harmless from any loss
which the Depositary may suffer and any expense (including the reasonable fees
and expenses of counsel) which the Depositary may incur as a result of the
failure of any purchaser to remit payment in full for any Commercial Paper
Notes (other than any loss or expense resulting from the gross negligence or
willful misconduct of the Depositary or any director, officer, employee or
agent thereof) and, without limiting the generality of the foregoing, DTFC
agrees that, immediately upon notification from the Depositary of failure of a
purchaser to remit payment, DTFC shall reimburse the Depositary in immediately
available funds any amount credited to DTFC in anticipation of receipt of such
payment plus any applicable overdraft fees and interest thereon for each day
such proceeds remain unreimbursed. The overdraft charges and rate of interest
payable by DTFC to the Depositary shall be that provided for either (i) under
arrangements with respect to overdraft advances in effect at the time between
DTFC and the Depositary or (ii) if no such arrangements are then in effect, in
the Depositary's standard fee schedule for overdrafts.
For purposes of this Section 4, payment for any Commercial Paper Notes
shall not be irrevocable and final until the Depositary shall have received
from or on behalf of the account of the purchaser of such Commercial Paper
Notes immediately available funds which under applicable law and rule are
irreversible, which are not subject to any security interest, levy or other
encumbrance enforceable against the Depositary or DTFC, and which are
specifically applicable or determined by the Depositary to be applicable to the
payment of such Commercial Paper Notes. A debit by the Depositary to any
account of a person to whom or for whose account such Commercial Paper Notes
shall have been delivered shall not constitute final payment to the extent that
such debit creates an overdraft or does not otherwise result in the receipt by
the Depositary of immediately available, irreversible and unencumbered funds.
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At the close of business on each Business Day on which Commercial
Paper Notes are issued or mature, you shall prepare a written statement
containing, or otherwise make electronically available, the following
information provided the Issuer delivers such request in writing: (i) the
aggregate face amount and issue price of all discount Commercial Paper Notes
issued on that Business Day and the principal amount and the interest rate of
all interest bearing Commercial Paper Notes issued on that Business Day, which
statement shall include the serial number, in the case of Certificated Notes,
or the CUSIP number, in the case of Book Entry CP Notes, issue date, maturity
date and face amount thereof; and (ii) the aggregate face amount and issue
price of all discount Commercial Paper Notes Outstanding and the aggregate
principal amount and the interest rate of all interest bearing Commercial Paper
Notes Outstanding at the close of business on such day. You shall furnish such
information electronically or otherwise to DTFC, the Liquidity Agent and the
Collateral Agent on that day and at such other times as DTFC, the Liquidity
Agent or the Collateral Agent may from time to time reasonably request. To the
extent that a written statement is the method of providing information, a copy
of each statement referred to above and each Certificated Note issued shall be
sent by you by either telecopy or overnight delivery service to DTFC, the
Liquidity Agent and the Collateral Agent at their addresses specified herein,
no later than the following Business Day.
SECTION 5. Payment of Commercial Paper Notes at Maturity. (a) Each
matured Commercial Paper Note presented to you for payment on any Business Day
prior to the standard window closing time (as established by the rules of the
New York Clearing House Association in effect from time to time) on such
Business Day, shall be paid the same day in accordance with the provisions of
paragraph (b) of this Section 5. Each matured Commercial Paper Note presented
to you for payment on any Business Day after such time shall be paid on the
next succeeding Business Day in accordance with the provisions of paragraphs
(b) and (c) of this Section 5.
(b) You shall pay each matured Commercial Paper Note presented to you
for payment prior to the close of business on any Business Day from funds
available for such payment in the Commercial Paper Account (including funds
from Commercial Paper Notes issued or to be issued on that day). If on any
given day on which a Commercial Paper Note is scheduled to mature by its terms,
upon receiving notice from the Dealers by 12:00 p.m. (New York City time) on
such day specifying the amount of Commercial Paper Notes placed by such Dealers
by that time on such day, and upon DTFC's determining that a Commercial Paper
Deficit exists, DTFC shall give notice thereof to the Collateral Agent, not
later than 12:15 p.m. (New York City time) on such day, and DTFC shall instruct
the Collateral Agent to deliver a Borrowing Request to the Liquidity Agent for
a Borrowing consisting of Refunding Advances, not later than 12:30 p.m. (New
York City time) on the date of a proposed Borrowing, irrevocably requesting
that a Borrowing be made in an aggregate principal amount (subject to the
immediately following sentence) equal to the excess of (i) the Commercial Paper
Deficit over (ii) the sum of the aggregate amount, if any, applied or to be
applied on such Business Day to the Commercial Paper Deficit from amounts
available therefor in the Collateral Account or the Series 1998-1 Collection
Account and the Termination Advance Account that are designated for payment of
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maturing Commercial Paper Notes. In accordance with and subject to the terms
of the Liquidity Agreement, the proceeds of any Refunding Advances (and/or any
Swing Line Advances) shall be remitted to the Commercial Paper Account not
later than 3:00 p.m. (New York City time) on the date of the requested
Borrowing. You shall apply the proceeds of any Refunding Advances and any
Swing Line Advances obtained by you first to reimburse yourself for any
advances made by you on any matured Commercial Paper Note and second to the
payment of the Commercial Paper Notes in respect of which the Refunding
Advances and Swing Line Advances were obtained.
(c) If on any given day on which a Commercial Paper Note is
scheduled to mature by its terms (after giving effect to funds deposited in the
Commercial Paper Account pursuant to clause (b) above), a Commercial Paper
Deficit exists, and the Aggregate Liquidity Commitment shall be fully drawn
under the Liquidity Agreement, or is unavailable for reasons other than a
failure to satisfy conditions precedent for such drawing, (i) if the Series
1998-1 Letter of Credit has not been terminated and LOC Termination
Disbursements have not been made, you are hereby authorized and directed to
notify the Collateral Agent to cause the Enhancement Agent to request LOC
Liquidity Disbursements in an amount equal to the Commercial Paper Deficit, as
it may be reduced after giving effect to funds received pursuant to clause (b)
above, (up to the Series 1998-1 Letter of Credit Amount) in accordance with the
provisions of the Collateral Agreement and (ii) if the Series 1998-1 Letter of
Credit has been terminated and LOC Termination Disbursements have been made,
then you are hereby authorized and directed to notify the Collateral Agent of
the existence and amount of the Commercial Paper Deficit, as so reduced, and to
instruct the Collateral Agent to cause the Enhancement Agent to withdraw an
amount equal to the Commercial Paper Deficit (up to the amount then on deposit
in the Series 1998-1 Cash Collateral Account) from the Series 1998-1 Cash
Collateral Account in accordance with the provisions of the Collateral
Agreement and deposit into the Commercial Paper Account such LOC Liquidity
Disbursement or such withdrawal from the Series 1998-1 Cash Collateral Account.
If a Commercial Paper Deficit continues to exist you shall cease paying matured
and maturing Commercial Paper until such time as the Collateral Agent shall
instruct you otherwise; it being understood that the purpose of such delay is
to permit an equitable distribution of funds allocated to the Holders pursuant
to the Collateral Agreement to be made pro rata according to the face amount of
all Commercial Paper Notes Outstanding (as may be adjusted as determined by the
Collateral Agent to compensate Holders for accrued interest to reflect delay in
payment) rather than first to the earliest maturing Commercial Paper Notes. In
accordance and subject to the terms of the Series 1998-1 Letter of Credit, the
proceeds of such LOC Liquidity Disbursement or any such withdrawal from the
Series 1998-1 Cash Collateral Account shall be remitted into the Commercial
Paper Account not later than 4:00 p.m. (New York City time) on the date of the
requested drawing. You shall apply the proceeds of any LOC Liquidity
Disbursement or any such withdrawal from the Series 1998-1 Cash Collateral
Account obtained by you first, to reimburse yourself for any advances made by
you on any matured Commercial Paper Note and second, to the payment of the
Commercial Paper Notes in respect of which LOC Liquidity Disbursements were
obtained.
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If at the time any Commercial Paper Note is presented to you for
payment there are insufficient funds on deposit and available in the Commercial
Paper Account (after giving effect to transfers thereto, if any, from the
Collateral Account or the Series 1998-1 Collection Account and from the
Liquidity Lenders in the form of Refunding Advances and/or Swing Line Advances
or from the Credit Enhancer in the form of LOC Liquidity Disbursements in
accordance with paragraph (b) or (c) of this Section 5) to pay such Commercial
Paper Note in full, you shall be entitled, but not required, to pay such
Commercial Paper Note before your close of business that day and you shall
thereupon be deemed and treated as the holder of such Commercial Paper Note and
shall be entitled to receive payment for such Commercial Paper Note (from the
proceeds of Refunding Advances, Swing Line Advances or LOC Liquidity
Disbursements, as the case may be, or from any other source available in
accordance with the Collateral Agreement for the payment of Commercial Paper
Notes). DTFC shall pay you interest, upon your demand, on the amount paid by
you to the holder of such Commercial Paper Note at a rate per annum equal to
your corporate base rate in effect from time to time during the period from but
excluding the date of payment made by you to and including the day you are
reimbursed for such amount. Unless you are reimbursed for such amount by DTFC
prior to your making demand for payment of such Commercial Paper Note, you
shall promptly make demand for payment of such Commercial Paper Note.
(d) DTFC hereby agrees to advise the Depositary by 9:30 a.m. (New
York City time) on each Business Day on which Commercial Paper Notes are
maturing of the aggregate amount of new Commercial Paper Notes, if any,
anticipated to be placed by the Dealers. To the extent that the Depositary
determines that a Commercial Paper Deficit exists between such aggregate amount
and the aggregate amount of new Commercial Paper Notes that are actually placed
by the Dealers as of 12:00 noon (New York City time) on such Business Day as
reported to the Depositary, the Depositary will use its best efforts to contact
DTFC with the amount of such Commercial Paper Deficit so as to determine
whether a Commercial Paper Deficit exists.
(e) Certificated Notes paid in full by you shall be canceled and held
by you in safekeeping for disposition in accordance with written instructions
to you by DTFC. Unless DTFC instructs you otherwise, you shall dispose of such
Certificated Notes in accordance with your usual procedure.
SECTION 6. Book Entry Commercial Paper Notes. (a) DTFC may elect to
make the Commercial Paper Notes eligible for the book entry commercial paper
program of DTC, in which case (i) DTFC will instruct the Depositary in writing
to issue book entry Commercial Paper Notes ("Book Entry CP Notes") through DTC
instead of, or in addition to, issuing certificated Commercial Paper Notes as
hereinbefore provided, (ii) the Depositary will prepare for execution by DTFC
and the Depositary DTC's current form Letter of Representations (the "Letter"),
a copy of which is attached hereto as Exhibit D, (iii) DTFC will provide to the
Depositary for submission with the Letter a copy of the information memorandum
for DTFC's commercial paper program under which the Commercial Paper Notes are
issued by the Depositary pursuant to this Agreement and (iv) DTFC will deliver
the Letter to DTC's Legal
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Department and will return to the Depositary a copy of the Letter after it has
been received and accepted by DTC. The Depositary is authorized and directed
to issue and settle through DTC Book Entry CP Notes in accordance with the
applicable rules and procedures established by DTC and the Depositary for the
issuance and settlement of book entry notes upon receipt by the Depositary of
written instructions pursuant to clause (i) of the immediately preceding
sentence. DTC's procedures with respect to the issuance of book entry notes
(the "Book Entry Procedures"), among other things, currently provide that
issuance of Book Entry CP Notes with a maturity date on a holiday on which DTC
is scheduled to be closed for settlement services are not acceptable for
deposit into DTC's CP Program. In the event there is any delay in the issuance
of Book Entry CP Notes resulting from DTFC's instructions to the Depositary
providing for the issuance of Book Entry CP Notes to mature on DTC holidays,
the Depositary shall not be liable to DTFC, DTC or any beneficial owner of a
Book Entry CP Note. Each Book Entry CP Note issued and distributed through DTC
upon the instruction of a Designated Person from an Authorized Representative
shall constitute DTFC's representation and warranty that such Book Entry CP
Note is a legal, valid and binding obligation of DTFC.
(b) Once the Commercial Paper Notes have been accepted by DTC for
DTC's commercial paper program and prior to the issuance and distribution of
any Book Entry CP Notes, DTFC will deliver (i) to the Depositary, as custodian
for DTC, the Master Note (the "Master Note") with respect to Book Entry CP
Notes issued at a discount from face value to be paid at maturity and with
respect to Book Entry CP Notes issued in interest bearing form (in the form of
Exhibit E hereto), duly executed on behalf of DTFC by the manual or facsimile
signature of an Authorized Signatory to evidence Book Entry CP Notes to be
issued and distributed through DTC by the Depositary on behalf of DTFC (and the
obligation of DTFC to provide for payment of such Book Entry CP Notes at their
respective maturities) and (ii) to the Depositary, copies of all agreements
entered into by DTFC required by DTC for participation in DTC's book entry
commercial paper program. The Depositary shall maintain a record of each
change in the face amount of Outstanding Book Entry CP Notes or, in the case of
interest bearing Book Entry CP Notes the principal amount and the interest rate
thereon represented thereby and the maturity dates thereof.
(c) In accordance with DTC's book entry commercial paper program, the
Depositary shall obtain from the CUSIP Service Bureau a written list of CUSIP
numbers for the Book Entry CP Notes that will be issued through DTC as provided
in the Letter, and the Depositary shall deliver such list to DTC. The
Depositary shall instruct the CUSIP Service Bureau to bill DTFC for the fee or
fees payable to CUSIP Service Bureau for such list of CUSIP numbers for book
entry Commercial Paper Notes. The CUSIP numbers, as required by DTC's
commercial paper program, will be assigned to DTFC's Book Entry CP Notes upon
issuance and used to identify DTFC's Outstanding Book Entry CP Notes in DTC's
book entry system.
(d) On and after the date when the Commercial Paper Notes become
eligible for DTC's book entry commercial paper program, the Depositary shall
execute all instructions from DTFC to issue Commercial Paper Notes by, subject
to the provisions of Section 3 of this Agreement,
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issuing and delivering only Book Entry CP Notes through DTC, except where the
Depositary has been specifically instructed in writing by DTFC to complete and
deliver one or more Certificated Notes.
(e) In the event and on each occasion that DTFC agrees with a Holder
that holds Book Entry CP Notes (a "Book Entry CP Holder") to prepay such Book
Entry CP Holder's Book Entry CP Notes on deposit with DTC prior to the
scheduled maturity of such Book Entry CP Notes, DTFC shall make arrangements
with such Book Entry CP Holder and the Depositary for the delivery through the
DTC system by the DTC participant holding such Commercial Paper Notes to the
Depositary's designated account at DTC for payment.
(f) DTFC may for any reason discontinue its participation in DTC's
book entry commercial paper program with respect to the Commercial Paper Notes
at any time upon not less than ten days prior written notice to the Depositary
(with copies of such notice to the Dealers). In the event DTFC shall
discontinue its participation in DTC's book entry commercial paper program, or
DTC shall discontinue its services with respect to the Book Entry CP Notes,
DTFC and the Depositary shall cooperate in taking appropriate action, including
without limitation, if necessary, delivery of one or more Certificated Notes to
any DTC participant having Book Entry CP Notes credited to its DTC account. In
the event of such discontinuance of DTFC's participation in DTC's commercial
paper program as herein described, and upon delivery of Certificated Notes in
respect of all Book Entry CP Notes represented by the Master Note, the
Depositary shall destroy such Master Note and provide DTFC with a duly executed
certificate of destruction with respect to such Master Note. Upon written
notice by DTFC to the Depositary of the discontinuance of DTFC's participation
in DTC's book entry program with respect to the Commercial Paper Notes in
respect of all Book Entry CP Notes represented by the Master Note, the
Depositary shall destroy such Master Note and provide DTFC with a duly executed
certificate of destruction with respect to such Master Note. Notice by DTFC to
the Depositary of the discontinuance of DTFC's participation in DTC's book
entry program with respect to the Commercial Paper Notes shall not constitute
notice of termination of the Depositary's duties as issuing and paying agent
for Certificated Notes under this Agreement.
(g) All references in this Agreement to "Commercial Paper Notes"
shall apply to and shall include any Book Entry CP Notes issued hereunder by
DTFC. Any reference in this Agreement to authentication, completion and
delivery of the Commercial Paper Notes shall, in the context of Book Entry CP
Notes, be deemed to mean issuance of Commercial Paper Notes in accordance with
DTC's and the Depositary's rules and procedures with respect to the Book Entry
CP Notes and any reference to presentation of Commercial Paper Notes for
payment shall, in the context of Book Entry CP Notes, be deemed to mean the
procedure undertaken by DTC to make a demand for payment from DTFC (through the
Depositary) of matured Book Entry CP Notes. References in this Agreement to
"Holders" of the Commercial Paper Notes shall, in the context of Book Entry CP
Notes, refer to the beneficial owners of such Book Entry CP Notes, except that
in the case of payment of Book Entry CP Notes by the Depositary, the term
"Holder" shall be deemed to refer to Cede & Co. Upon payment of all
Outstanding Book Entry CP Notes
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represented by a Master Note, and upon request by DTFC, the Depositary shall
destroy such Master Note, and provide DTFC with a duly executed certificate of
destruction with respect to such Master Note.
SECTION 7. Inspection of Documents by Commercial Paper Note Holders.
You shall keep a fully executed or conformed copy of the Liquidity Agreement,
the Collateral Agreement and this Agreement (together with all amendments,
modifications, supplements, waivers and consents made or given with respect
thereto which have been delivered to you by the Issuer), on file at your
address set forth in Section 12 hereof. DTFC agrees to provide to you a copy
of all such documents and any amendments thereto promptly following their
execution. You shall permit reasonable inspection to be made of such documents
during normal business hours by the Holder of any Commercial Paper Note or by
any officer, employee or agent of such Holder, provided that the person
purporting to be such Holder establishes to your satisfaction that he is in
fact such Holder of such Commercial Paper Note and, in cases where inspection
is sought to be made by a person purporting to be an officer, employee or agent
of such Holder, that such person submits evidence satisfactory to you of his
authority to make such inspection on behalf of the Holder of such Commercial
Paper Note.
SECTION 8. Expenses and Indemnity. DTFC agrees:
(a) to pay to you from time to time reasonable compensation
for all services rendered by you hereunder, which are subject to
change as circumstances may warrant as set forth in Exhibit G hereto,
including for the issuance of Book Entry CP Notes through DTC, and to
reimburse you for expenses, disbursements and advances (if any), in
each case as mutually agreed upon;
(b) to indemnify you (which for purposes of this Section 8
shall include your directors, officers, employees and agents) for, and
hold you harmless from and against, any and all losses (except your
loss of profit), liabilities (including liabilities for penalties),
actions, suits, judgments, demands, damages, reasonable out-of-pocket
costs and expenses (including, without limitation, interest and
reasonable attorneys' fees and disbursements, but excluding costs and
expenses attributable solely to administrative overhead) arising out
of, in connection with, or resulting from the review, execution and
delivery of this Agreement or any amendment hereto, or in connection
with, the exercise of your rights and/or the performance of your
duties, by you or by your directors, officers, agents and employees,
hereunder; provided, however, that DTFC shall not be liable to
indemnify you for, or hold you harmless from, damage, cost and expense
resulting from or attributable to your gross negligence or willful
misconduct or that of your officers, employees or agents. The
foregoing indemnity will survive the termination or expiration of this
Agreement and your resignation or removal as Depositary and issuing
and paying agent, and includes, but is not limited to, any action
taken or omitted to be taken by you upon telephonic, electronic or
written instructions (authorized herein) received by you from, or
believed by you in good faith to have been given by, the proper person
or
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persons; provided further, that any claims arising hereunder shall be
limited by the provisions of Section 20 hereof.
SECTION 9. Representations and Warranties. In addition to any other
representations and warranties on the part of DTFC contained herein, DTFC
hereby represents and warrants to you that its entry into this Agreement, and
your appointment by DTFC as depositary and issuing and paying agent and, in
certain circumstances, as agent with respect to the Commercial Paper Notes,
have been duly authorized by all necessary corporate action on the part of DTFC
and will not result in any violation, breach or contravention of any law, rule,
regulation, order, contract or agreement binding upon DTFC which has a Material
Adverse Effect, or may in the future have a Material Adverse Effect on, the
business, financial condition or operations of DTFC or the performance by DTFC
of its obligations under any of the CP Program Documents to which it is a
party. In addition, DTFC represents and warrants, and each instruction to
issue Commercial Paper Notes will constitute a representation and warranty,
that the issuance of the Commercial Paper Notes, including, if the Commercial
Paper Notes become eligible for deposit as book entry only in DTC's commercial
paper program, the issuance of Book Entry CP Notes and the execution of any
instruments or documents required by DTC in connection therewith, has been duly
and validly authorized by all necessary corporate action, and that the
Commercial Paper Notes, when completed, countersigned and delivered pursuant
hereto, will constitute DTFC's legal, valid and binding obligation enforceable
against DTFC in accordance with their terms, are not required to be registered
under the Securities Act of 1933, as amended, and from applicable state
securities laws and will be in conformity with the terms of the Liquidity
Agreement.
SECTION 10. Term and Termination. (a) The term of this Agreement
(except for the provisions of Sections 8, 20 and 21 which shall survive
indefinitely and the provisions of Section 18, which shall survive for the
period set forth therein) shall extend from the date hereof and shall end on
the earliest of:
(i) the date on which all Commercial Paper Notes have been
repaid, the Aggregate Liquidity Commitment has terminated and the
Series 1998-1 Letter of Credit Expiration Date has occurred, subject
to the conditions set forth in paragraph (d) of this Section 10; and
(ii) the date of termination specified in any termination
notice given pursuant to paragraph (b) of this Section 10.
Any Commercial Paper Notes Outstanding on the date of any termination
of this Agreement pursuant to paragraphs (a) or (b) of this Section 10 shall
nevertheless remain valid obligations of DTFC, and the provisions of this
Agreement shall continue to be applicable with respect to the payment of such
Commercial Paper Notes to the same extent as if this Agreement had not
terminated.
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(b) Either you or DTFC may terminate this Agreement and the authority
granted to you herein, at any time upon not less than thirty Business Days'
prior written notice given to the other parties hereto specifying the
termination date hereof (which shall not occur on the date of maturity of any
Commercial Paper Notes nor the Business Day next preceding any such date).
Notwithstanding the preceding sentence, no termination of this Agreement shall
take effect until a successor to the Depositary has been duly appointed, unless
all outstanding Commercial Paper Notes have been paid in full and no amounts
are due to Commercial Paper holders. You may petition a court of competent
jurisdiction if no such appointment is made within 30 Business Days of your
termination notice. No successor to the Depositary may be appointed, however,
if such appointment shall result in the withdrawal or reduction of any rating
assigned to the Commercial Paper Notes. Upon the termination of this Agreement
under paragraph (a) of this Section or this paragraph (b), you shall promptly
deliver to DTFC or your successor, if one is appointed, all Commercial Paper
Notes (including any Master Note) then held by you hereunder for DTFC's account
for safekeeping, against receipt by DTFC or such successor, and shall cause to
be deposited in the Collateral Account, upon advice to DTFC, the Liquidity
Agent and the Collateral Agent, all funds, if any, then on deposit in, or
otherwise to the credit of, the Commercial Paper Account.
(c) No Commercial Paper Notes shall be delivered to you by DTFC for
safekeeping or issuance hereunder nor shall any Certificated Notes be
authenticated or delivered to any Dealer or any applicable holder or any Book
Entry Issuance Instruction be issued by you upon the termination of this
Agreement and the authority granted to you herein.
(d) Notwithstanding any termination of this Agreement, the Depositary
(or the successor to the Depositary if one has been appointed) shall maintain
the Commercial Paper Account until the earlier of the first anniversary of the
date of termination of this Agreement and the date on which the Commercial
Paper Notes Outstanding have been paid in full and apply any amounts in the
Commercial Paper Account to repay Commercial Paper Notes as they mature.
Pending disbursement of such amounts to repay maturing Commercial Paper Notes,
the Depositary or the Collateral Agent, as the case may be, shall invest such
amounts in Eligible Investments designated in writing by DTFC which mature not
later than the anticipated date or dates on which Commercial Paper Notes
mature, such written designation to certify that the requested investment
constitutes an Eligible Investment and matures at the time required by this
sentence. Any investment earnings on Eligible Investments shall be released
to DTFC after payment in full of all Commercial Paper Notes Outstanding.
SECTION 11. Amendments and Modifications. (a) No amendment,
modification, termination or waiver of any provision of this Agreement shall be
effective unless (i) the same shall be in writing and signed by all of the
parties hereto and consented to in writing by the Dealers, the Liquidity Agent
on behalf of the Majority Banks and the Collateral Agent, and (ii) S&P, Moody's
and DCR have confirmed in writing that their respective ratings on the
Commercial Paper Notes will not be lowered or withdrawn as a result of any such
amendment, modification, termination or waiver. No such amendment,
modification, termination or waiver
-16-
<PAGE> 19
shall, as evidenced by an opinion of counsel delivered to the Depositary by the
Issuer upon which it may conclusively rely, adversely affect the rights of the
Holder or Holders of any Commercial Paper Notes Outstanding at the time of such
amendment, modification, termination or waiver unless consented to in writing
by such Holder or Holders.
Notwithstanding the foregoing provisions of this Section 11(a), the
Dealers, the Liquidity Agent and the Collateral Agent may with the written
consent of the Depositary, at any time and from time to time, without the
consent of the Majority Banks, enter into any amendment, supplement or other
modification to this Agreement to cure any apparent ambiguity or to correct or
supplement any other provision herein; provided, however, that (i) any such
action shall not have a material adverse effect as evidenced by an opinion of
counsel delivered to the Depositary by the Issuer on the interests of the
Liquidity Lenders and (ii) a copy of such amendment, supplement or other
modification is furnished to each Liquidity Lender in accordance with the
notice provisions of the Liquidity Agreement not later than ten days prior to
the execution thereof by the parties hereto.
(b) Contemporaneously with any amendment, modification, termination
or waiver of any provision of the Liquidity Agreement, the Collateral Agreement
or any other CP Program Document, DTFC shall give notice to you summarizing
such action and shall furnish you with a fully executed and conformed copy of
such amendment, modification, waiver or consent. No amendment of any of the
foregoing agreements which could reasonably be expected to have a material
adverse effect on your rights, duties or powers hereunder shall be effective
against you without your written consent.
SECTION 12. Notices. Except where telephonic instructions or notices
are authorized herein to be given, all notices, demands, instructions and other
communications required or permitted to be given to any party hereunder shall
be in writing and addressed, delivered or transmitted to such party at its
address or facsimile number set forth below, or at any other address or
facsimile number, as the case may be, as such party may notify the other
parties hereto in accordance with the provisions of this Section 12. Any
notice, if mailed and properly addressed with postage prepaid or if properly
addressed and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be deemed given when
transmitted upon receipt of electronic confirmation of transmission.
-17-
<PAGE> 20
If to the Depositary:
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attention: Corporate Trust and Agency Group/Commercial
Paper Group Telephone: (212) 250-3939
Telecopier: (212) 669-5970
If to DTFC:
Dollar Thrifty Funding Corp.
5330 East 31st Street
Tulsa, Oklahoma 74135
Attention: Michael H. McMahon
Telephone: 918-669-3914
Telecopier: 918-669-2925
If to the Collateral Agent:
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attention: Corporate Trust and Agency Group/Commercial
Paper Group Telephone: (212) 250-3939
Telecopier: (212) 669-5970
If to the Liquidity Agent:
Credit Suisse First Boston
Eleven Madison Avenue
New York, New York 10010-3629
Attention: Asset Finance Department
Telephone: (212) 325-9078
Telecopier: (212) 325-6677
-18-
<PAGE> 21
If to the Dealers:
Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010-3629
Attention: Short and Medium Finance Department
Telephone: (212) 325-7198
Telecopier: (212) 325-8183
Chase Securities Inc.
270 Park Avenue, 9th Floor
New York, New York 10017
Attention: Money Market Division
Telephone: (212) 834-5070
Telecopier: (212) 834-6560
If to S&P:
Standard & Poor's Ratings Group
26 Broadway, 15th Floor
New York, New York 10004
Attention: Asset Backed Surveillance Department
Telephone: (212) 208-8000
Telecopier: (212) 412-0225
-19-
<PAGE> 22
If to Moody's:
Moody's Investors Service, Inc.
99 Church Street
New York, New York 10007
Attention: ABS Monitoring Department
Telephone: (212) 553-0300
Telecopier: (212) 553-4600
If to DCR:
Duff & Phelps Credit Rating Co.
55 East Monroe Street, Suite 3800
Chicago, Illinois 60603
Attention: John Bella
Telephone: (312) 368-3100
Telecopier: (312) 263-2852
SECTION 13. Binding Effect; Assignment. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns. No party hereto may assign any of its
rights or obligations hereunder (other than in connection with the appointment
of a successor to the Depositary under Section 10 or by DTFC pursuant to the
Collateral Agreement) except with (i) the prior written consent of all parties
hereto and (ii) the prior written confirmation of S&P, Moody's and DCR that
their respective rating on the Commercial Paper Notes will not be lowered or
withdrawn.
SECTION 14. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
SECTION 15. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute one and the same Agreement. Delivery of an
executed counterpart of a signature page to this Agreement by facsimile
transmission shall be effective as delivery of a manually executed counterpart
of this Agreement.
SECTION 16. Conditions Precedent. The Depositary shall execute this
Agreement upon satisfaction of the following conditions precedent:
-20-
<PAGE> 23
(a) Delivery by DTFC to the Depositary of execution copies of
this Agreement, the Liquidity Agreement, the Collateral Agreement and
the Series 1998-1 Letter of Credit.
(b) Delivery by DTFC to the Depositary of (i) a legal opinion
on the enforceability of this Agreement, the enforceability of the
Commercial Paper Notes when issued, the enforceability of the
Collateral Agreement under New York State law, the exemption of the
Commercial Paper Notes from registration under the Securities Act of
1933 and the exemption of DTFC from the Investment Company Act of 1940
reporting requirements and (ii) its incumbency certificate in the form
of Exhibit B.
SECTION 17. Headings. Section headings used in this Agreement are
for convenience only and shall not affect the construction of this Agreement.
SECTION 18. No Petition. You, in your capacity as Depositary hereby
covenant and agree that, prior to the date which is one year and one day after
the payment in full of all Commercial Paper Notes Outstanding, you will not
institute against, or join any other Person in instituting against, DTFC, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
or other similar proceeding under the laws of the United States or any state of
the United States. In the event that you take action in violation of this
Section 18, DTFC agrees, for the benefit of the Holders, that it shall file, an
answer with the bankruptcy court or otherwise properly contest the filing of
such a petition by you against DTFC or the commencement of such action and
raise the defense that you have agreed in writing not to take such action and
should be estopped and precluded therefrom and such other defenses, if any, as
its counsel advises that it may assert. The provisions of this Section 18
shall survive the termination of this Agreement, and your resignation or
removal as Depositary and issuing and paying agent.
SECTION 19. Duties and Responsibilities. It is understood that you
are acting as agent of DTFC. Neither you nor any of your officers, directors,
employees or agents shall be liable for any action taken or omitted to be taken
by you or them hereunder except for acts of gross negligence or willful
misconduct by your officers, employees or agents. Neither the Depositary nor
its officers or employees shall be required to ascertain whether any issuance
or sale of Commercial Paper Notes (or any amendment or termination of this
Agreement) has been duly authorized or is in compliance with any other
agreement to which DTFC is a party (whether or not the Depositary is a party to
such other agreement). You undertake to perform such duties and only such
duties as are set forth in this Agreement and no implied covenants shall be
read into this Agreement against you and you make no representations or
warranties with respect to the valuation or adequacy of the Depositary's
collateral. The Depositary shall also not be liable for any action taken, or
any failure to take any action in connection with this Agreement or the
services provided hereunder or otherwise to fulfill its obligations in
connection with this Agreement, in the event and to the extent that the taking
of such action or such failure arises out of or is caused by mechanical
breakdown, computer or system failure or other failure of equipment, failure or
malfunctioning of any communications media for whatever reason, or any
-21-
<PAGE> 24
other cause outside of the control of the Depositary, provided that the
Depositary undertakes to use reasonable efforts to cure any such failure or
breakdown of the Depositary's equipment. It is understood by DTFC that
provision of services under this Agreement is dependent upon the availability
to the Depositary and DTFC of telecommunication facilities provided by third
party vendors and that the Depositary cannot warrant such availability.
You shall incur no liability in acting within the scope of this
Agreement on any notice or instruction, telephonic or written, given hereunder
which a Designated Person believes in good faith to have been given by an
Authorized Representative or by the Liquidity Agent or the Collateral Agent;
nor shall you in so acting assume or be deemed to have assumed any
responsibility for the propriety of any transaction effected by you under, or
the compliance of any such transaction with the Liquidity Agreement or any CP
Program Document. Your countersignature of any Commercial Paper Note shall be
for authentication purposes only and neither you nor any person countersigning
on your behalf shall have any liability on any Commercial Paper Note.
You may rely and shall be protected in acting or refraining from
acting upon any communication authorized by this Agreement and upon any written
instruction, notice, request, direction, consent, report, certificate,
Commercial Paper Note or other instrument, paper or document believed by you to
be genuine. You shall not be liable for acting upon any telephone
communication authorized by this Agreement which you believe in good faith to
have been given by DTFC or any authorized party hereunder. You may record
telephone communications with DTFC or any authorized party hereunder.
Anything in this Agreement to the contrary notwithstanding, in no
event shall you, or any of your directors, officers, employees or agents, be
liable under this Agreement to DTFC or any third party for indirect, special,
punitive, incidental or consequential loss or damage of any kind whatsoever,
including, but not limited to, lost profits, whether or not the likelihood of
such loss or damage was known to you, or any such director, officer, employee
or agent. In no event shall the Depositary be considered negligent in
consequence of complying with DTC's rules, regulations and procedures.
You may consult with counsel and the advice of such counsel shall be
full and complete authorization and protection in respect of any action taken,
offered or omitted by you hereunder in good faith and in reliance thereon.
No prior action or course of dealing on your part with respect to
advances of the purchase price or payments of matured commercial paper shall
give rise to any claim or cause of action by the Issuer, any holder, or any
other party against you in the event that you refuse to pay or settle any
Commercial Paper Notes for which the Issuer has not timely provided funds as
required by this Agreement.
-22-
<PAGE> 25
You in your individual or any other capacity, may become the owner or
pledgee of Commercial Paper Notes or a participant in the credit provided under
the Liquidity Agreement or the Series 1998-1 Letter of Credit and may otherwise
transact banking or trust business with any of the parties with the same rights
as you would have if you were not acting hereunder.
Except as otherwise expressly provided herein, whenever, in the
administration of this Agreement, you shall deem it necessary that a matter be
proved or established prior to taking, suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be conclusively proved and
established by a certificate of an Authorized Representative, and such
certificate shall be full warranty to you for any action taken, suffered or
omitted under the provisions of this Agreement upon the faith thereof.
Except as otherwise provided herein, the Depositary may execute any of
the powers hereunder or perform any duties hereunder either directly or by or
through agents, including, without limitation, the Sub-Agent, or attorneys;
provided, however, that the Depositary shall not be responsible for the acts of
DTC but shall be responsible only for the selection of other agents with due
care. DTFC hereby acknowledges the interest of DTC in the Commercial Paper
Notes and Certificated Notes. The Depositary shall be under no liability for
interest on any moneys received by the Depositary hereunder except as the
Depositary may agree with DTFC to pay thereon.
SECTION 20. No Recourse. The obligations of DTFC under this
Agreement are solely the corporate obligations of DTFC. No recourse shall be
had for the payment of any amount owing in respect to Section 8 hereof or for
the payment of any fee hereunder or any other obligation or claim arising out
of or based upon this Agreement against any Dealer or against any shareholder,
employee, officer, director or incorporator of DTFC. For purposes of this
Section 20, the term "Dealer" shall mean and include all Affiliates thereof and
any employee, officer, director, incorporator, shareholder, affiliate or
beneficial owner of any of them; provided, however, that neither the Depositary
nor DTFC shall be considered to be an Affiliate of any Dealer for purposes of
this Section 20.
SECTION 21. Limited Recourse to DTFC. Notwithstanding any other
provision of this Agreement, the Depositary agrees that the obligations of DTFC
to the Depositary hereunder shall be payable in the order and priority set
forth in Section 2.01 and 5.02(b), as applicable, of the Collateral Agreement.
Such obligations shall be due and payable to the extent that DTFC's assets are
sufficient to pay such obligations. No recourse shall be had for the payment
of any amount owing hereunder or for the payment of any fee hereunder or any
other obligation or claim arising out of or based upon this Agreement against
any stockholder, employee, officer, director or incorporator of DTFC; provided,
however, that the foregoing shall not relieve any such person or entity from
any liability they might otherwise have as a result of fraudulent actions or
omissions taken by them. No claims of the Depositary (whether under the cited
provision or
-23-
<PAGE> 26
otherwise) arising under or in connection with this Depositary Agreement are
intended to be impaired or waived by this Section 21.
SECTION 22. Merger or Consolidation. Any corporation or other entity
into which the Depositary may be merged or consolidated, or any corporation or
other entity resulting from any merger, conversion or consolidation to which
the Depositary shall be a party, or any Person or entity succeeding to the
corporate trust or agency business of the Depositary, shall be the successor of
the Depositary hereunder (without relieving the Depositary of its
responsibilities hereunder if it survives such merger, conversion,
consolidation or succession) without the execution or filing of any paper or
any further act on the part of any party hereto, anything to the contrary
notwithstanding; provided, however, that (a) upon the request of DTFC, the
Collateral Agent or the Liquidity Agent, such corporation, entity or successor
shall execute an assumption agreement providing for the assumption by such
corporation, entity or successor of the rights and obligations of the
Depositary in a form reasonably satisfactory to DTFC, the Collateral Agent and
the Liquidity Agent and (b) the Depositary shall give the Rating Agencies prior
written notice of such merger, conversion, consolidation or succession.
SECTION 23. Amortization Event. If the Depositary shall have been
notified by DTFC, the Liquidity Agent, any Liquidity Lender or the Collateral
Agent that an Amortization Event shall have occurred, the Depositary shall
notify the Liquidity Agent and the Collateral Agent in writing as soon as
possible upon payment in full of all Commercial Paper Notes Outstanding or the
receipt of funds in the amount required to pay all Commercial Paper Notes
Outstanding upon maturity.
SECTION 24. Entire Agreement. This Agreement together with the
exhibits attached hereto, constitutes the entire understanding among the
parties hereto with respect to the Depositary. This Agreement is solely for the
benefit of the parties hereto and no other person shall acquire or have any
right under or by virtue hereof.
SECTION 25. Waiver of Set-Off. The Depositary hereby waives and
relinquishes any right it has or may have to set-off or to exercise any
banker's lien or any right of attachment or garnishment with respect to any
funds at any time and from time to time on deposit in, or otherwise to the
credit of, any account and any claims of DTFC therein or with respect to any
right to payment from DTFC, it being understood, however, that nothing
contained in this Section 25 shall, or is intended to, derogate from the
assignment and security interest granted to the Collateral Agent under the
Collateral Agreement or impair any rights of the Holders, the Depositary or the
Collateral Agent thereunder.
SECTION 26. Additional Notice. DTFC shall give prompt written notice
to each Rating Agency if it is required to make a payment hereunder to the
Depositary with respect to increased costs of the Depositary or indemnification
obligations to the Depositary.
-24-
<PAGE> 27
SECTION 27. Opinion of Counsel. On the Closing Date, the Issuer shall
deliver to you all documents you may reasonably request relating to corporate
existence and authority to enter into this Agreement, including, without
limitation, an opinion of counsel to that effect.
SECTION 28. Force Majeure. In no event shall you be liable for any
failure or delay in the performance of your obligations hereunder because of
circumstances beyond your control, including, but not limited to, acts of God,
flood, war (whether declared or undeclared), terrorism, fire, riot, strikes or
work stoppages for any reason, embargo, government action, including any laws,
ordinances, regulations, or the like which restrict or prohibit the providing
of the services contemplated by this Agreement, inability to obtain material,
equipment, or communications or computer facilities, and other causes beyond
your control whether or not of the same class or kind as specifically named
above.
SECTION 29 Jurisdiction and Venue. Each party hereby irrevocably and
unconditionally submits to the jurisdiction of the United States District Court
for the Southern District of New York and any New York State court located in
the Borough of Manhattan in New York City and of any appellate court from any
thereof for the purposes of any legal suit, action or proceeding arising out of
or relating to this Agreement (a "Proceeding"). Each party hereby irrevocably
agrees that all claims in respect of any Proceeding may be heard and determined
in such Federal or New York State court and irrevocably waives, to the fullest
extent it may effectively do so, any objection it may now or hereafter have to
the laying of venue of any Proceeding in any of the aforementioned courts and
the defense of an inconvenient forum to the maintenance of any Proceeding.
-25-
<PAGE> 28
If the foregoing is acceptable to you, please indicate your agreement
therewith by signing this or a duplicate counterpart of this Agreement in the
space provided below, and returning this or such duplicate signed counterpart
to DTFC, whereupon this Agreement will become a binding agreement between us
and you.
DOLLAR THRIFTY FUNDING CORP.
By:
---------------------------
Name:
Title:
ACCEPTED AND AGREED:
BANKERS TRUST COMPANY,
as Depositary
By:
-----------------------------
Name:
Title:
CONSENTED TO:
CREDIT SUISSE FIRST BOSTON,
as Liquidity Agent
By:
------------------------------
Name:
Title:
By:
-----------------------------
Name:
Title:
<PAGE> 29
CONSENTED TO:
BANKERS TRUST COMPANY,
as Collateral Agent
By:
-----------------------------
Name:
Title:
-27-
<PAGE> 30
EXHIBIT A
to the Depositary Agreement
DOLLAR THRIFTY FUNDING CORP.
COMMERCIAL PAPER NOTE
No.
$ Issuing Date:
For value received, DOLLAR THRIFTY FUNDING CORP. ("DTFC") promises to
pay to the order of BEARER, the sum of _______________ ____________________
DOLLARS ($________) plus accrued interest at a rate per annum of ___% (in the
case of an interest bearing Commercial Paper Note) payable at the principal
corporate trust office in New York, New York of Bankers Trust Company.
Payment of this Commercial Paper Note shall be made at the office of
Bankers Trust Company (the "Depositary") at 4 Albany Street, New York, New York
10006, pursuant to a certain Depositary Agreement dated as of March 4, 1998, as
it may from time to time be amended or modified and in effect (the "Depositary
Agreement") between DTFC and the Depositary, by 3:00 p.m. (New York City time)
on any Business Day, provided that this Commercial Paper Note is presented for
payment not later than the standard window closing time (as established by the
rules of the New York Clearing House Association in effect from time to time)
on such Business Day. If this Commercial Paper Note is presented for payment
after 2:00 p.m. (New York City time) on a Business Day, payment will be made on
the next succeeding Business Day. "Business Day" means a day other than a
Saturday, Sunday or other day on which commercial banks are authorized to close
in New York City. Capitalized terms not otherwise defined herein are used
herein with the meanings assigned thereto in the Depositary Agreement.
The holder of this Commercial Paper Note is entitled to the benefits
of a certain Collateral Agreement made by DTFC in favor of Bankers Trust
Company, as Collateral Agent. By accepting the benefits of the security
interest granted therein, the holder of this Commercial Paper Note hereby
irrevocably authorizes the Collateral Agent to take such action on behalf of
such holder under the provisions of the Collateral Agreement and the related
documents to exercise such powers and perform such duties as are expressly
delegated to it by the terms thereof, together with such other powers as are
reasonably incidental thereto.
DTFC has delivered to the Depositary the Collateral Agreement, the
Liquidity Agreement, the Depositary Agreement and other CP Program Documents
(including any amendments thereto) and they are on file with the Depositary at
its office at 4 Albany Street, New York, New York 10006, and reference is made
to such documents for the terms under which this Commercial Paper Note has been
issued, the collateral security for this Commercial Paper Note,
<PAGE> 31
the rights and duties of the Collateral Agent and the terms of the Liquidity
Agreement and the Series 1998-1 Letter of Credit.
THIS COMMERCIAL PAPER NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE
CONFLICT OF LAW PRINCIPLES THEREOF.
DOLLAR THRIFTY FUNDING CORP.
By:
-------------------------
Authorized Signature
Countersigned for authentication only (without recourse, warranty or
liability):
BANKERS TRUST COMPANY,
as Depositary
By:
-----------------------
Authorized Signature
This Commercial Paper Note is not valid for any purpose unless
countersigned by Bankers Trust Company, as Depositary.
-2-
<PAGE> 32
EXHIBIT B
to the Depositary Agreement
INCUMBENCY CERTIFICATE
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attention: Corporate Trust and Agency Group / Commercial Paper Group
Ladies and Gentlemen:
This is to certify that, until such time as you shall have received
from Dollar Thrifty Funding Corp. ("DTFC") a subsequent Incumbency Certificate
or written notice to the contrary (i) each of the persons listed on Appendix
B-1 hereto is an "Authorized Signatory" and is authorized to execute Commercial
Paper Notes and (ii) each of the persons listed on Appendix B-2 hereto is an
"Authorized Representative" and is authorized to act and to give instructions
and notices on behalf of DTFC under Section 2 of the Depositary Agreement,
dated as of March __, 1998, entered into between DTFC and Bankers Trust
Company, as it may from time to time be amended or modified and in effect.
Date: __________________
DOLLAR THRIFTY FUNDING CORP.
By:
-------------------------
Name:
Title:
<PAGE> 33
APPENDIX B-1
Authorized Signatories
NAME TITLE SIGNATURE
(please type or print)
- --------------------------- ------------------------ --------------------
- --------------------------- ------------------------ --------------------
- --------------------------- ------------------------ --------------------
- --------------------------- ------------------------ --------------------
- --------------------------- ------------------------ --------------------
Mailing Address:
Telecopier:
<PAGE> 34
APPENDIX B-2
Authorized Representatives
NAME TITLE SIGNATURE
(please type or print)
- --------------------------- ------------------------ --------------------
- --------------------------- ------------------------ --------------------
- --------------------------- ------------------------ --------------------
- --------------------------- ------------------------ --------------------
- --------------------------- ------------------------ --------------------
Mailing Address:
Telecopier:
<PAGE> 35
EXHIBIT C
to the Depositary Agreement
Reserved
<PAGE> 36
EXHIBIT D
to the Depositary Agreement
LETTER OF REPRESENTATIONS
<PAGE> 37
EXHIBIT E
to the Depositary Agreement
FORM OF COMMERCIAL PAPER MASTER NOTE
March , 1998
Date of Issuance
Dollar Thrifty Funding Corp. ("DTFC") a corporation existing under the laws of
the State of Oklahoma, for value received, hereby promises to pay to Cede &
Co., as nominee of the Depository Trust Company, or to registered assigns: (i)
the principal amount, together with unpaid accrued interest thereon, if any, on
the maturity date of each obligation identified on the records of DTFC (the
"Underlying Records"), as being evidenced by this Master Note, which Underlying
Records are maintained at Bankers Trust Company (the "Depositary"); (ii)
interest on the principal amount of each such obligation that is payable in
installments, if any, on the due date of each installment, as specified on the
Underlying Records; and (iii) the principal amount of each such obligation that
is payable in installments, if any, on the due date of each installment, as
specified on the Underlying Records. Interest shall be calculated at the rate
and according to the calculation convention specified on the Underlying
Records. Payments shall be made by wire transfer to the registered owner from
the Depositary without the necessity of presentation and surrender of this
Master Note.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS
OF THIS MASTER NOTE SET FORTH ON THE REVERSE HEREOF.
This Master Note is a valid and binding obligation of DTFC.
DOLLAR THRIFTY FUNDING CORP.
By:
---------------------------
Name:
Title:
Countersigned for authentication only:
BANKERS TRUST COMPANY,
as Depositary
By:
-------------------------------
Name:
<PAGE> 38
Title:
At the request of the registered owner, DTFC shall promptly issue and deliver
one or more separate note certificates evidencing each obligation evidenced by
this Master Note. As of the date any such note certificate or certificates are
issued, the obligations which are evidenced thereby shall no longer be
evidenced by this Master Note.
- --------------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto
-----------------------------------------------------------------------
(Name, Address and Taxpayer Identification Number of Assignee)
the Master Note and all rights thereunder, hereby irrevocably constituting and
appointing _______________________ attorney to transfer said Master Note on the
books of the Issuer with full power or substitution in the premises.
Dated:
---------------------------
(Signature)
Signature(s) Guaranteed:
NOTICE: The signature on this
assignment must correspond
with the name as written upon
the face of this Master Note,
in every particular, without
alteration or enlargement or
any change whatsoever.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO DOLLAR
THRIFTY FUNDING CORP. OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.
<PAGE> 39
EXHIBIT F
to the Depositary Agreement
Noteline Direct
The Issuer is granted a personal, non-transferable and non-exclusive
right to use the instruction and reporting communication service Noteline
Direct ("Noteline Direct") to transmit through the Noteline Direct system
Instructions made pursuant to the Agreement. The Issuer may, by separate
agreement between the Issuer and one or more of its commercial paper dealers or
sales agents (each an "Agent"), authorize the Agent (in each case other than
the Depositary) to directly access Noteline Direct for the purposes of
transmitting Instructions to the Depositary or obtaining reports with respect
to the obligations of the Issuer under the Agreement (the "Obligations").
The Issuer acknowledges that (a) some or all of the services utilized
in connection with Noteline Direct are furnished by Digital Transactions Inc.
("DTI"), Dynamic Microprocessor Associates Inc. ("DMA") and Bankers Trust
Company, (b) Noteline Direct is provided to the Issuer "AS IS" without
warranties or representations of any kind whatsoever by DTI, DMA or the
Depositary, and (c) Noteline Direct is proprietary and confidential property
disclosed to the Issuer in confidence and only on the terms and conditions and
for purposes set forth in this Agreement.
By this Agreement, the Issuer acquires no titles, ownership or
sublicensing rights whatsoever in Noteline Direct or in any trade secret,
trademark, copyright or patent of the Depositary, DTI, or DMA now or to become
applicable to Noteline Direct. The Issuer may not transfer, sublicense,
assign, rent, lease, convey, modify, translate, convert to a programming
language, decompile, disassemble, recirculate, republish or redistribute
Noteline Direct for any purpose without the prior written consent of the
Depositary and, where necessary, DTI and DMA.
In the event (a) any action is taken or threatened which may result in
a disclosure or transfer of Noteline Direct or any part thereof, other than as
authorized by this Agreement, or (b) the use of any trademark, trade name,
service mark service name, copyright or patent of the Depositary, DTI or DMA by
the Issuer amounts to unfair competition, or otherwise constitutes a possible
violation of any kind, then the Depositary and/or DTI and/or DMA shall have the
right to take any and all action deemed necessary to protect their rights in
Noteline Direct, and to avoid the substantial and irreparable damage which
would result from such disclosure, transfer or use, including the immediate
termination of the Issuer's right to use Noteline Direct.
To permit the use of Noteline Direct to issue instructions and/or
obtain reports with respect to the obligation, the Depositary will supply the
Issuer with an identification number and initial passwords. From time to time
thereafter, the Issuer may change its passwords directly
<PAGE> 40
through Noteline Direct. The Issuer will keep all information relating to its
identification number and passwords strictly confidential and will be
responsible for the maintenance of adequate security over its customer
identification number and passwords. For security purposes, the Issuer should
change its passwords frequently (at least one a year).
Instructions transmitted over Noteline Direct and received by the
Depositary pursuant to the Agreement accompanied by the Issuer's identification
number and the passwords, shall be deemed conclusive evidence that such
Instructions are correct and complete and that the issuance or redemption of
the Obligation(s) directed thereby has been duly authorized by the Issuer.
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<PAGE> 41
EXHIBIT G
to the Depositary Agreement
FEE LETTER
<PAGE> 1
EXHIBIT 4.17
[EXECUTION COPY]
================================================================================
COLLATERAL AGREEMENT
dated as of March 4, 1998
among
DOLLAR THRIFTY FUNDING CORP.,
CREDIT SUISSE FIRST BOSTON,
as Liquidity Agent and Series 1998-1 Letter of Credit Provider
CREDIT SUISSE FIRST BOSTON CORPORATION,
as a Dealer,
and
BANKERS TRUST COMPANY,
as Depositary and as Collateral Agent
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE I.
DEFINITIONS
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE II.
OBLIGATIONS COLLATERALIZED
SECTION 2.01. Obligations Collateralized Hereby . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE III.
AGENTS; REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 3.01. DTFC and Other Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3.02. Representations and Warranties of DTFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 3.03. Additional Representations, Warranties and Covenants of DTFC . . . . . . . . . . . . . . . . . . . . . 6
SECTION 3.04. Representations and Warranties of the Collateral Agent . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE IV.
ASSIGNMENT
SECTION 4.01. Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 4.02. Application of Assigned Collateral and Deposited Funds . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 4.03. Performance of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 4.04. Amendments; Waivers; Declaration of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4.05. Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
</TABLE>
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<PAGE> 3
<TABLE>
<CAPTION>
ARTICLE V.
COLLATERAL ACCOUNT, LIQUIDITY LENDER ACCOUNT,AND CREDIT ENHANCER ACCOUNT
<S> <C>
SECTION 5.01. Establishment of Collateral Account, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 5.02. Assignment of Accounts, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 5.03. Application of Deposited Funds and Assigned Collateral . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 5.04. Eligible Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 5.05. Liquidity Demand; Commitment Termination Demand . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE VI.
DEFAULT
SECTION 6.01. Rights of the Collateral Agent upon Liquidity Agreement Amortization Event and
Liquidation Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE VII.
THE COLLATERAL AGENT, THE LIQUIDITY LENDERS,AND THE HOLDERS OF COMMERCIAL PAPER NOTES
SECTION 7.01. Appointment and Powers of Collateral Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 7.02. Collateral Agents and Employees of the Collateral Agent . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 7.03. Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 7.04. Successor Collateral Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 7.05. Qualifications of Collateral Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 7.06. Instructions of the Required Liquidity Providers and Other Parties . . . . . . . . . . . . . . . . . 27
ARTICLE VIII.
AMENDMENTS, MODIFICATIONS, WAIVERS AND CONSENTS
SECTION 8.01. Execution of Amendments, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
</TABLE>
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<PAGE> 4
<TABLE>
<CAPTION>
ARTICLE IX.
MISCELLANEOUS
<S> <C> <C> <C>
SECTION 9.01. Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 9.02. No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 9.03. Notice of Amendments; Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.04. Notices, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.05. Fee; Costs and Expenses, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 9.06. Collateral Agent Appointed Attorney-in-Fact . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 9.07. Termination; Assigned Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 9.08. Governing Law; Binding Character; Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 9.09. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 9.10. No Bankruptcy Petition Against DTFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 9.11. No Recourse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 9.12. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 9.13. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 9.14. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 9.15. Limited Recourse to DTFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 9.16. Waiver of Set-Off With Respect to DTFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 9.17. Obligations of Collateral Agent Under the Note Purchase Agreement . . . . . . . . . . . . . . . . . 36
EXHIBIT A - FEE LETTER
</TABLE>
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<PAGE> 5
COLLATERAL AGREEMENT
THIS COLLATERAL AGREEMENT (this "Collateral Agreement"), dated as of
March 4, 1998, is entered into among DOLLAR THRIFTY FUNDING CORP., an Oklahoma
corporation ("DTFC"), CREDIT SUISSE FIRST BOSTON CORPORATION, a Massachusetts
corporation ("CSFB" and, together with Chase Securities, Inc., a Delaware
corporation, in its capacity as a dealer and any other dealers for Commercial
Paper Notes engaged by DTFC from time to time that agree to become parties to
this Collateral Agreement and the Dealer Agreement, the "Dealers") as a dealer
under the Dealer Agreement, CREDIT SUISSE FIRST BOSTON, a Swiss banking
corporation, as liquidity agent (the "Liquidity Agent") for the banks party to
the Liquidity Agreement (the "Liquidity Lenders"), acting on its own behalf as
credit enhancer (in such capacity, the "Series 1998-1 Letter of Credit
Provider") and BANKERS TRUST COMPANY, a New York banking corporation, as
depositary (the "Depositary") under the Depositary Agreement and acting on its
own behalf and on behalf of the Holders of Commercial Paper Notes, the
Liquidity Lenders, the Liquidity Agent and the Dealers, as collateral agent (in
such capacity, the "Collateral Agent") .
BACKGROUND
1. DTFC proposes to issue and sell its promissory notes (the
"Commercial Paper Notes") in the commercial paper market and proposes to obtain
the Liquidity Commitments (such capitalized term, together with all other
capitalized terms used herein, shall have the meaning assigned thereto in
Section 1.01 hereof) of the Liquidity Lenders, to make Liquidity Advances to
DTFC.
2. Contemporaneously with the execution and delivery of this
Collateral Agreement, Rental Car Finance Corp., an Oklahoma corporation
("RCFC"), and Bankers Trust Company, a New York banking corporation, as Trustee
(in such capacity, the "Trustee"), are entering into the Series 1998-1
Supplement, dated as of even date herewith (as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof, the "Series 1998-1 Supplement") to the Base Indenture dated as
of December 13, 1995, as amended (as the same may be amended, supplemented or
otherwise modified from time to time in accordance with the terms thereof, the
"Base Indenture"), among RCFC and the Trustee, pursuant to which RCFC will
issue the Variable Funding Rental Car Asset Backed Notes, Series 1998-1 (the
"Series 1998-1 Notes").
3. Contemporaneously with the execution and delivery of this
Collateral Agreement, RCFC, DTAG and DTFC, as Note Purchaser, are entering into
the Note Purchase Agreement dated as of even date herewith (as the same may be
amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Note Purchase Agreement"), pursuant to which DTFC
will purchase the Series 1998-1 Notes and make loans
<PAGE> 6
from time to time to RCFC, the proceeds of which will be used to purchase and
finance Vehicles for leasing under the terms of the Master Motor Vehicle Lease
and Servicing Agreement (the "Master Lease") among RCFC, as lessor, Thrifty
Rent-A-Car System, Inc., an Oklahoma corporation ("Thrifty"), as lessee and
servicer, Dollar Rent A Car Systems, Inc., an Oklahoma corporation ("Dollar")
as lessee and servicer, Dollar Thrifty Automotive Group, Inc., a Delaware
corporation ("DTAG"), as guarantor and master servicer, and those Subsidiaries
of DTAG from time to time becoming lessees and servicers thereunder (Thrifty,
Dollar, and such Subsidiaries, collectively the "Lessees").
4. Contemporaneously with the execution and delivery of this
Collateral Agreement, DTFC, the Liquidity Agent and the Liquidity Lenders are
entering into the Liquidity Agreement dated as of even date herewith (as it may
be amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Liquidity Agreement"), providing for, among other
things, the Liquidity Commitments of the Liquidity Lenders to make Liquidity
Advances on behalf of DTFC from time to time.
5. Contemporaneously with the execution and delivery of this
Collateral Agreement, DTFC, DTAG, Credit Suisse First Boston Corporation and
Chase Securities Inc. are entering into the Dealer Agreement dated as of even
date herewith (as it may be amended, supplemented or otherwise modified from
time to time in accordance with the terms thereof, the "Dealer Agreement"),
providing for, among other things, each Dealer to act as a commercial paper
dealer for the Commercial Paper Notes.
6. Contemporaneously with the execution and delivery of this
Collateral Agreement, DTFC, Dollar, Thrifty, RCFC, DTAG and the Series 1998-1
Letter of Credit Provider are entering into a CP Enhancement Letter of Credit
Application and Agreement (the "CP Enhancement Letter of Credit Application and
Agreement") pursuant to which the Series 1998-1 Letter of Credit Provider will
issue the Series 1998-1 Letter of Credit as partial credit support for the
Lessees' payment obligations under the Master Lease and as liquidity support
for maturing Commercial Paper Notes.
7. Contemporaneously with the execution and delivery of this
Collateral Agreement, DTFC and the Depositary are entering into the Depositary
Agreement dated as of even date herewith (as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof, the "Depositary Agreement") providing for the issuance of the
Commercial Paper Notes.
8. Contemporaneously with the execution and delivery of this
Collateral Agreement, RCFC, DTAG, and the Lessees are entering into the Master
Lease.
9. DTFC is entering into this Collateral Agreement with the
Liquidity Agent, the Series 1998-1 Letter of Credit Provider, the Depositary,
the Collateral Agent and CSFB in its
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<PAGE> 7
capacity as a Dealer for the purpose of, among other things, providing for the
repayment or payment of all amounts at any time and from time to time owing by
DTFC to the Liquidity Lenders or the Liquidity Agent under or in connection
with the Liquidity Agreement or this Collateral Agreement and all amounts owing
at any time and from time to time by DTFC to the Series 1998-1 Letter of Credit
Provider under or in connection with the Series 1998-1 Letter of Credit or this
Collateral Agreement or owing by DTFC to the Holders of the Commercial Paper
Notes or the Depositary or owing to the Collateral Agent hereunder or owing to
the Dealers under the Dealer Agreement.
NOW, THEREFORE, in consideration of the premises and agreements herein
contained, each of DTFC, the Liquidity Agent, the Depositary, the Collateral
Agent and CSFB, in its capacity as a Dealer, agree as follows:
ARTICLE I.
DEFINITIONS
SECTION 1.01. Definitions. As used in this Collateral
Agreement and unless the context requires a different meaning, capitalized
terms not otherwise defined herein shall have the meanings assigned to such
terms in (i) the Definitions List (the "Definitions List to the Liquidity
Agreement"), attached as Annex A to the Liquidity Agreement, as such
Definitions List to the Liquidity Agreement may be amended, supplemented or
otherwise modified in accordance with the Liquidity Agreement, (ii) the Series
1998-1 Supplement, and (iii) the Definitions List (the "Definitions List to the
Base Indenture") attached as Schedule 1 to the Base Indenture as in effect as
of the date hereof (as such Definitions List to the Base Indenture may be
amended, amended and restated, supplemented or otherwise modified from time to
time in accordance with the terms thereof).
ARTICLE II.
OBLIGATIONS COLLATERALIZED
SECTION 2.01. Obligations Collateralized Hereby. This
Collateral Agreement is made to provide for repayment and payment of the
Indebtedness and liabilities of DTFC (such Indebtedness and liabilities being
herein called the "DTFC Obligations") set forth below. Upon the occurrence,
and during the continuance, of a Liquidity Agreement Amortization Event, the
DTFC Obligations will be paid in the order of priority indicated below:
First, the repayment, pro rata, of (i) all amounts advanced or
expended by the Collateral Agent, in its capacity as Collateral Agent,
for the account of DTFC
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<PAGE> 8
hereunder, and the payment of all reasonable out-of-pocket costs, fees
and expenses at any time and from time to time payable hereunder to
the Collateral Agent, in its capacity as such, in connection with the
administration or enforcement of this Collateral Agreement or any CP
Program Document (including, without limitation, the reasonable fees
and out-of-pocket expenses of counsel employed by the Collateral Agent
in connection therewith) and the payment of all indemnities at any
time and from time to time due by DTFC hereunder to the Collateral
Agent in its capacity as such up to an aggregate amount equal to
$75,000 per annum, and (ii) all fees and expenses at any time and from
time to time due to the Depositary pursuant to Section 8(a) of the
Depositary Agreement up to an aggregate amount equal to $50,000 per
annum;
Second, subject to the last sentence of Section 5.02(f), the
payment of all Indebtedness, at any time and from time to time, due
from DTFC on the Outstanding Commercial Paper Notes issued pursuant to
and in accordance with the Depositary Agreement;
Third, the payment of all operating and ordinary course
expenses of DTFC up to an aggregate amount equal to $100,000 per
annum;
Fourth, the payment of all amounts at any time and from time
to time due to the Liquidity Agent as notified to the Collateral Agent
pursuant to Section 3.6.5 of the Liquidity Agreement;
Fifth, the payment, pro rata, of all principal Indebtedness
(including Commitment Termination Date Liquidity Advances), at any
time and from time to time, due (in the case of a Commitment
Termination Date Liquidity Advance, such Advance will be deemed to be
due for purposes of this clause Fifth on the date such Advance is
made) from DTFC (a) to the Liquidity Lenders in connection with the
Liquidity Advances made pursuant to the Liquidity Agreement, and (b)
to the Series 1998-1 Letter of Credit Provider (or, if applicable, to
the Series 1998-1 Cash Collateral Account) in connection with moneys
drawn under the Series 1998-1 Letter of Credit (or, if applicable,
withdrawn from the Series 1998-1 Cash Collateral Account) to fund any
LOC Liquidity Disbursements, together with all amounts payable in
respect of interest on any of the foregoing;
Sixth, the payment, pro rata, of all other Indebtedness
(including, but not limited to fees, reimbursements, funding
indemnities, taxes and increased costs, but excluding amounts
referenced in clause Eighth below), at any time and from time to time,
due to the Liquidity Lenders, the Liquidity Agent and the Series
1998-1 Letter of Credit Provider (solely with respect to amounts due
from DTFC under the CP Enhancement Letter of Credit Application and
Agreement), pro rata, the payment of any other amounts (excluding
those referenced in clause Eighth below) at any time and
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<PAGE> 9
from time to time due from DTFC to any of them under or in respect of
the Liquidity Agreement, the Series 1998- 1 Letter of Credit or the CP
Enhancement Letter of Credit Application and Agreement, as the case
may be, together with all amounts due from DTFC in respect of interest
thereon, and the payment, pro rata, of all indemnities at any time and
from time to time due from DTFC hereunder to the Liquidity Lenders and
the Series 1998-1 Letter of Credit Provider, it being understood that
amounts payable under this clause Sixth shall relate exclusively to
costs and expenses incurred in or in connection with the procurement
and handling of funds and the making of such funds available to or for
the account or benefit of DTFC and shall not include amounts payable
in connection with general indemnity claims relating to the use by
DTFC or the Series 1998-1 Letter of Credit Provider of the proceeds of
such financial accommodations (other than, in the event such actions
give rise to breakage costs, any action in the nature of a prepayment
by DTFC) or actions taken or omitted to be taken by DTFC under the CP
Program Documents and not directly related to the procurement of
funds, all of which shall be covered by clause Eighth below;
Seventh, the repayment of reasonable amounts owing to the
Collateral Agent and the Depositary referred to in clause First above
in excess of $75,000 per annum with respect to the Collateral Agent
and in excess of $50,000 with respect to the Depositary;
Eighth, the repayment, pro rata, of all reasonable amounts
advanced or expended by any Liquidity Lender or the Series 1998-1
Letter of Credit Provider under this Collateral Agreement, as the case
may be, and any other amounts and reasonable out-of-pocket costs and
expenses due from DTFC to any party under or in connection with the
Liquidity Agreement, the Series 1998-1 Letter of Credit, the CP
Enhancement Letter of Credit Application and Agreement, the Depositary
Agreement, the Dealer Agreement or any other CP Program Document,
whether in respect of indemnities thereunder or otherwise; and
Ninth, the payment of all other expenses of DTFC referred to
in clause Third above in excess of $100,000 per annum.
ARTICLE III.
AGENTS; REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 3.01. DTFC and Other Agents. (a) With the delivery
of this Collateral Agreement, DTFC is furnishing to the Collateral Agent, and
from time to time thereafter may furnish to the Collateral Agent, a certificate
upon which it may conclusively rely (the "DTFC Incumbency Certificate")
certifying the incumbency and specimen signatures of officers,
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<PAGE> 10
employees, agents or representatives of DTFC (the "DTFC Agents") authorized to
act, and to give instructions and notices, on behalf of DTFC hereunder. Until
the Collateral Agent receives a subsequent DTFC Incumbency Certificate, the
Collateral Agent shall be entitled to rely on the last such DTFC Incumbency
Certificate delivered to it for purposes of determining the authorized DTFC
Agents.
(b) With the delivery of this Collateral Agreement, the Depositary
is furnishing to the Collateral Agent, and from time to time thereafter may
furnish to the Collateral Agent, a certificate (the "Depositary Incumbency
Certificate") certifying as to the incumbency and specimen signatures of
officers of the Depositary (the "Depositary Agents") authorized to act, and to
give instructions and notices, on behalf of the Depositary hereunder. Until
the Collateral Agent receives a subsequent Depositary Incumbency Certificate,
the Collateral Agent shall be entitled to rely on the last such Depositary
Incumbency Certificate delivered to it for purposes of determining the
authorized Depositary Agents. Notwithstanding anything in this Section 3.01(b)
to the contrary, for so long as the Collateral Agent is also the Depositary,
the Depositary shall not be required to furnish a Depositary Incumbency
Certificate to the Collateral Agent pursuant to this Section 3.01(b).
(c) With the delivery of this Collateral Agreement and from time
to time thereafter, the Liquidity Agent shall furnish to the Collateral Agent a
certificate upon which it may conclusively rely (the "Liquidity Agent
Incumbency Certificate") certifying as to the incumbency and specimen
signatures of officers of the Liquidity Agent (the "L.A. Agents") authorized
to act, and to give instructions and notices, on behalf of the Liquidity Agent
hereunder. Until the Collateral Agent receives a subsequent Liquidity Agent
Incumbency Certificate, the Collateral Agent shall be entitled to rely on the
last such Liquidity Agent Incumbency Certificate delivered to it for purposes
of determining the authorized L.A. Agents.
SECTION 3.02. Representations and Warranties of DTFC. DTFC
reaffirms and repeats its representations and warranties contained in the
Liquidity Agreement and the CP Enhancement Letter of Credit Application and
Agreement and agrees that the Secured Parties may rely on such representations
and warranties as though set forth herein in full.
SECTION 3.03. Additional Representations, Warranties and
Covenants of DTFC. DTFC hereby makes the following representations, warranties
and covenants to the Collateral Agent, the Depositary, the Liquidity Agent, the
Holders of the Commercial Paper Notes, the Liquidity Lenders and the Dealers:
(a) All action necessary (including the filing of UCC-1
financing statements, the delivery of the Series 1998-1 Notes to the
Collateral Agent) to protect and perfect the Collateral Agent's
security interest on behalf of the Secured Parties in the Assigned
Collateral (as defined in Section 4.01) now in existence and hereafter
acquired or created and the Deposited Funds has been duly and
effectively taken.
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<PAGE> 11
(b) No security agreement, financing statement,
equivalent security or lien instrument or continuation statement
listing DTFC as debtor covering all or any part of the Assigned
Collateral is on file or of record in any jurisdiction, except such as
may have been filed, recorded or made by DTFC in favor of the
Collateral Agent pursuant to this Collateral Agreement.
(c) This Collateral Agreement creates a valid and
continuing Lien on the Assigned Collateral in favor of the Collateral
Agent on behalf of the Secured Parties, which Lien is prior to all
other Liens, except for Permitted Liens, and is enforceable as such as
against creditors of and purchasers from DTFC. All action necessary
or desirable to protect and perfect such prior security interest has
been duly taken.
(d) DTFC's principal place of business and chief
executive office shall be at: 5330 East 31st Street, Tulsa, Oklahoma
74135 and the place where its records concerning the Assigned
Collateral are kept is at 5330 East 31st Street, Tulsa, Oklahoma
74135. DTFC will not change its name or such principal place of
business or chief executive office or remove such records without 30
days prior written notice to the Collateral Agent.
(e) At any time and from time to time, upon the written
request of the Collateral Agent, and at the sole expense of DTFC, DTFC
will promptly and duly execute and deliver any and all such further
instruments and documents and take such further action as the
Collateral Agent may reasonably deem necessary in obtaining the full
benefits of this Collateral Agreement and of the rights and powers
herein granted, including, without limitation, the filing of any
financing or continuation statements under the Uniform Commercial Code
in effect in any jurisdiction with respect to the liens and security
interests granted hereby. DTFC also hereby authorizes the Collateral
Agent if directed by the secured Parties to file any such financing or
continuation statement without the signature of DTFC to the extent
permitted by applicable law. If any amount payable under or in
connection with any of the Assigned Collateral shall be or become
evidenced by any promissory note, chattel paper or other instrument,
such note, chattel paper or instrument shall be deemed to be held in
trust and immediately pledged to the Collateral Agent hereunder, and
shall, subject to the rights of any Person in whose favor a prior Lien
has been perfected, be duly endorsed in a manner satisfactory to the
Collateral Agent promptly.
(f) DTFC will warrant and defend the Collateral Agent's
right, title and interest in and to the Assigned Collateral and the
income, distributions and proceeds thereof, for the benefit of the
Secured Parties against the claims and demands of all Persons
whomsoever.
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<PAGE> 12
(g) All authorizations in this Collateral Agreement for
the Collateral Agent to endorse checks, instruments and securities and
to execute financing statements, continuation statements, security
agreements and other instruments with respect to the Assigned
Collateral are powers coupled with an interest and are irrevocable.
SECTION 3.04. Representations and Warranties of the
Collateral Agent. The Collateral Agent hereby represents, warrants and
covenants to the Secured Parties that this Collateral Agreement has been duly
authorized, executed and delivered by the Collateral Agent and constitutes a
legal, valid and binding obligation of the Collateral Agent, enforceable
against the Collateral Agent in accordance with its terms, except as such
enforceability may be subject to bankruptcy or insolvency laws, creditors'
rights generally and general principles of equity.
ARTICLE IV.
ASSIGNMENT
SECTION 4.01. Assignment. (a) In order to secure and
provide for the payment and repayment of the DTFC Obligations, DTFC hereby
pledges, assigns, conveys, delivers, transfers and sets over to the Collateral
Agent, for the ratable benefit of the Collateral Agent, the Liquidity Lenders,
the Liquidity Agent, the Series 1998-1 Letter of Credit Provider, the
Depositary, the Dealers and the Holders of the Commercial Paper Notes (the
foregoing being referred to as the "Secured Parties") as their respective
interests appear, and hereby grants to the Collateral Agent, for the benefit of
the Secured Parties, a security interest in all of DTFC's right, title and
interest in and to all assets, property and interests in property (other than
as specified below) whether now owned or hereafter acquired or created (all of
the foregoing being referred to as the "Assigned Collateral"), including
without limitation, all of the following property and interests in property:
(i) the DTFC Agreements, including, without limitation,
the Series 1998-1 Notes, all monies due and to become due to DTFC from
RCFC under or in connection with the DTFC Agreements, whether payable
as principal, interest, fees, expenses, costs, indemnities, insurance
recoveries, damages for the breach of any of the DTFC Agreements or
otherwise, and all rights, remedies, powers, privileges and claims of
the Debtor against any other party under or with respect to the Series
1998-1 Notes, the Series 1998-1 Supplement and other DTFC Agreements
(whether arising pursuant to the terms of such DTFC Agreements or
otherwise available to DTFC at law or in equity), the right to enforce
the Series 1998-1 Notes, the Series 1998-1 Supplement or any other
DTFC Agreement as provided herein and to give or withhold any and all
consents, requests, notices, directions, approvals, extensions or
waivers under or with
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respect to the Series 1998-1 Notes, the Series 1998-1 Supplement or
any other DTFC Agreement or the obligations of any party thereunder;
and
(ii) all right, title and interest of DTFC in, to and
under any Vehicle Disposition Program as they relate to the Existing
Fleet or to the Financed Vehicles financed with the proceeds of the
Series 1998-1 Notes, and all monies due and to become due in respect
of such Vehicles from the Manufacturers under or in connection with
the Vehicle Disposition Programs, whether payable as Vehicle
repurchase prices, auction sales proceeds, fees, expenses, costs,
indemnities, insurance recoveries, damages for breach of the Vehicle
Disposition Programs or otherwise and all rights to compel performance
and otherwise exercise remedies thereunder; and
(iii) all additional property that may from time to time
hereafter be subjected to the grant and pledge hereof by DTFC or by
anyone on its behalf; and
(iv) all property assigned to the Collateral Agent
pursuant to Section 5.02, including the Accounts, the Series 1998-1
Cash Collateral Account and the Deposited Funds; and
(v) all proceeds, products and profits of and from any
and all of the foregoing, including, without limitation, payments
under insurance (whether or not the Collateral Agent is the loss payee
thereof) or Vehicle warranties and cash.
Notwithstanding the foregoing, upon the disbursement by the Collateral Agent of
any amount distributable to DTFC in accordance with the terms of Section 2.01
or 5.02(b) for the payment of DTFC's operating and ordinary course expenses,
the security interest in such amount granted in favor of the Collateral Agent
shall be released.
(b) Notwithstanding the assignment and security interest so granted
to the Collateral Agent, DTFC shall nevertheless be permitted, subject to the
Collateral Agent's right to revoke such permission in the event of a Liquidity
Agreement Amortization Event (other than a Scheduled Liquidity Agreement
Amortization Event) or a Liquidation Event of Default and the provisions of
Section 4.03 hereof, to give all consents, requests, notices, directions,
approvals, extensions or waivers, if any, which are required to be given in the
normal course of business (which does not include waivers of defaults under any
of the DTFC Agreements or revocation of powers of attorney to RCFC) to RCFC by
DTFC by the specific terms of the Series 1998-1 Supplement or to any other
obligor under the Assigned Collateral, and the assignment of the Assigned
Collateral to the Collateral Agent shall not (i) relieve DTFC from the
performance of any term, covenant, condition or agreement on DTFC's part to be
performed or observed under or in connection with any of the DTFC Agreements or
from any liability to RCFC, the Collateral Agent or the Manufacturers, as the
case may be, or (ii) impose any obligation on any of the Secured Parties to
perform or observe any such term, covenant, condition or
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agreement on DTFC's part to be so performed or observed or impose any liability
on any of the Secured Parties for any act or omission on the part of DTFC or
from any breach of any representation or warranty on the part of DTFC. DTFC
hereby agrees to indemnify and hold harmless each Secured Party (which for
purposes of this Section 4.01(b) shall include their officers, directors,
employees and agents) from and against any and all losses, liabilities
(including liabilities for penalties), claims, demands, actions, suits,
judgments, reasonable out-of-pocket costs and expenses arising out of or
resulting from the assignment granted hereby by virtue of any act or omission
on the part of DTFC including, without limitation, the reasonable out-of-pocket
costs, expenses, and disbursements (including reasonable attorneys' fees and
expenses) incurred by any of the Secured Parties in enforcing this Collateral
Agreement or preserving any of their respective rights to, or realizing upon,
any of the Assigned Collateral other than any arising in connection with gross
negligence or willful misconduct on the part of any Secured Party.
SECTION 4.02. Application of Assigned Collateral and
Deposited Funds. DTFC hereby acknowledges and agrees that, until this
Collateral Agreement is terminated, DTFC shall, and the Collateral Agent is
authorized to, cause all monies, instruments, cash and other proceeds due and
to become due to DTFC or the Collateral Agent under or in connection with the
Assigned Collateral for the Series 1998-1 Notes to be paid directly to the
Collateral Agent for deposit into the Collateral Account or such other account
as the Collateral Agent may from time to time specify to the Person making such
payments (and DTFC represents to the Secured Parties that it has instructed
RCFC and the Manufacturers, as applicable, to so remit such amounts). DTFC
agrees that if any such monies, instruments, cash or other proceeds shall be
received by DTFC in an account other than the Collateral Account or in any
other manner, such monies, instruments, cash and other proceeds will not be
commingled by DTFC with any of its other funds or property, if any, but will be
held separate and apart therefrom and shall be held in trust by DTFC for, and
immediately paid over to, but in any event within two Business Days from
receipt, the Collateral Agent with any necessary endorsement. Provided that
the Collateral Account or any funds on deposit in, or otherwise to the credit
of, the Collateral Account are not then subject to any writ, order, judgment,
warrant of attachment, execution or similar process, all monies, instruments,
cash and other proceeds received by the Collateral Agent pursuant to this
Article IV shall be immediately deposited in the Collateral Account, and,
unless and until a Liquidity Agreement Amortization Event shall have occurred
and be continuing, shall be applied as provided in Section 5.02(b) hereof. All
monies, instruments, cash and other proceeds held or deposited in the
Collateral Account after the occurrence and during the continuance of a
Liquidity Agreement Amortization Event and all monies, instruments, cash and
other proceeds received by the Collateral Agent pursuant to this Article IV
while the Collateral Account or any funds on deposit in, or otherwise to the
credit of, the Collateral Account are subject to any writ, order, judgment,
warrant of attachment, execution or similar process, shall be applied by the
Collateral Agent (to the extent permitted by law) to the payment or repayment
in full of all outstanding DTFC Obligations, in the appropriate order of
priority specified in Section 2.01 of this Collateral Agreement.
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Notwithstanding the foregoing, to the extent that the aggregate amount of
proceeds relating to any Vehicle received in the Collateral Account exceeds the
Net Book Value of such Vehicle, the Collateral Agent shall, upon the written
direction of DTFC (on which it may conclusively rely), release such excess (to
the extent not previously applied hereunder) to RCFC within two Business Days
after the receipt of written instructions from the Master Servicer.
SECTION 4.03. Performance of Agreement. (a) Upon the
occurrence of a Liquidation Event of Default, promptly following a request from
the Collateral Agent to do so and at DTFC's own expense, DTFC agrees to take
all such lawful action and as permitted under this Collateral Agreement as the
Collateral Agent may reasonably request to compel or secure the performance and
observance by RCFC or by any other party to any DTFC Agreement or any other CP
Program Document of its obligations to DTFC in accordance with the applicable
terms thereof, and to exercise any and all rights, remedies, powers and
privileges lawfully available to DTFC to the extent and in the manner
reasonably directed by the Collateral Agent, including, without limitation, the
transmission of notices of default and the giving of directions, or the
institution of legal or administrative actions or proceedings to compel or
secure performance by RCFC (or such party to any DTFC Agreement or any other CP
Program Document), of their respective obligations thereunder; provided,
however, that if DTFC shall have failed, within 2 Business Days of receiving
the direction by the Collateral Agent, to accomplish such directions of the
Collateral Agent, the Collateral Agent may, but shall not be obligated to, take
such previously directed action (and any related action as permitted under this
Collateral Agreement thereafter determined by the Collateral Agent to be
appropriate without the need under this provision or any other provision
hereunder to direct DTFC to take such action) on behalf of DTFC and the Secured
Parties. Upon the occurrence of a Liquidation Event of Default, the Collateral
Agent may, and upon written direction from the Required Liquidity Providers
shall, take all lawful action at DTFC's expense (for reasonable costs and
expenses), to exercise any and all rights, remedies, powers and privileges
lawfully available to the Collateral Agent to the extent and in the manner
directed by the Required Liquidity Providers or, in the absence of such
direction, by the Collateral Agent itself, including, without limitation, the
transmission of notices of default and the institution of legal or
administrative actions or proceedings to compel or secure performance by RCFC,
DTFC or any obligor with respect to the Assigned Collateral (including, without
limitation, any Manufacturer under a Vehicle Disposition Program), and to
exercise any other remedies available to a secured party.
Subject to Section 4.01(b), DTFC further agrees that it will not,
without the prior written consent of the Collateral Agent, exercise any right,
remedy, power or privilege available to it with respect to any obligor under
the Assigned Collateral, take any action to compel or secure performance or
observance by any obligor of its obligations to DTFC or give any consent,
request, notice, direction, approval, extension or waiver with respect to any
obligor.
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In the event of a Liquidation Event of Default, the Required Liquidity
Providers shall be deemed to have directed that the Collateral Agent, and RCFC
return each Vehicle to the related Manufacturer under the related Vehicle
Disposition Program at the end of the minimum holding period (if any) for such
Vehicle under the related Vehicle Disposition Program, unless the Required
Liquidity Providers specifically waive such direction in writing.
(b) Unless otherwise specifically directed by the Required
Liquidity Providers in writing, in the event that there has occurred a
Manufacturer Event of Default, and the Collateral Agent shall have received
written notice thereof from any Secured Party, the Collateral Agent agrees to
direct the Master Collateral Agent to sell any and all Vehicles covered by the
related Vehicle Disposition Program of such Manufacturer for the highest
purchase price offered at a public or private sale and, promptly upon receipt,
to deposit the proceeds of such sale into the Collateral Account for
application in accordance with Section 5.02(b) or 2.01, as applicable.
SECTION 4.04. Amendments; Waivers; Declaration of Default.
Without intending in any manner to derogate from the absolute nature of the
assignment granted to the Collateral Agent by this Collateral Agreement or the
rights of the Collateral Agent hereunder, DTFC agrees that it will not, without
giving prior written notice to the Rating Agencies and the Dealers and without
the prior written consent of the Required Liquidity Providers and the
Collateral Agent (to the extent the rights or duties of the Collateral Agent
are affected thereby), amend, modify, supplement, terminate, waive or
surrender, or agree to any amendment, modification, supplement, termination or
surrender of, the terms of any Assigned Collateral, or waive timely performance
or observance by any obligor of its obligations under the Assigned Collateral,
or any default on the part of any obligor under the Assigned Collateral;
provided, however, that DTFC may amend the terms of any Assigned Collateral if
such amendment is effected only to cure any ambiguity, to correct or supplement
any provision therein which may be inconsistent with any other provision
therein or which is otherwise defective, or to make any other provisions with
respect to matters or questions arising under such Assigned Collateral which
shall not be inconsistent with the provisions of such Assigned Collateral;
provided further, however, any such action pursuant to this clause shall not
adversely affect the interests of a Secured Party in any material respect.
DTFC will not agree to any such amendment, waiver or other change (i) if such
amendment, waiver or other change would have a material adverse effect on the
rights or interests of the Holders of the Commercial Paper Notes or (ii) if the
Collateral Agent shall not have received written confirmation of the Rating
Agencies that such amendment, waiver or other change will not result in the
downgrading or withdrawal of the then current ratings of the Commercial Paper
Notes by the Rating Agencies. If any such amendment, modification, supplement
or waiver shall be so consented to by the Collateral Agent (to the extent
required) and the Required Liquidity Providers (to the extent required), DTFC
agrees, promptly following a request by the Collateral Agent or the Liquidity
Agent to do so, to execute and deliver, in its own name and at its own expense
(i) an officer's certificate and an opinion of counsel that such amendment is
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in compliance with the requirements of this Collateral Agreement, and (ii) such
other agreements, instruments, consents and other documents as the Collateral
Agent or the Liquidity Agent, as the case may be, may deem necessary or
appropriate in the circumstances. No consent by the Collateral Agent or any
other Secured Party to any such amendment, modification, supplement or waiver
shall be deemed to be a determination by the Collateral Agent that such
amendment, modification, supplement or waiver will not adversely affect the
rights of any Holder of Commercial Paper Notes.
Upon the occurrence of a Liquidity Agreement Amortization Event, the
Collateral Agent, upon direction by the Required Liquidity Providers, shall
direct DTFC (i) not to make any further Advances under the Note Purchase
Agreement, and (ii) if no Commercial Paper Notes are then outstanding, to
declare, or to direct the Trustee to declare, the Series 1998-1 Notes
immediately due and payable.
SECTION 4.05. Notice of Default. Promptly upon becoming
aware thereof, DTFC agrees to give the Liquidity Agent, the Liquidity Lenders,
the Depositary, the Dealers, the Collateral Agent and each Rating Agency prompt
written notice (and in no case more than two days after DTFC has actual
knowledge thereof) of each Liquidity Agreement Amortization Event or Potential
Liquidity Agreement Amortization Event and each default on the part of any
Manufacturer under any Vehicle Disposition Program that comes to DTFC's
attention.
ARTICLE V.
COLLATERAL ACCOUNT, LIQUIDITY LENDER ACCOUNT,
AND CREDIT ENHANCER ACCOUNT
SECTION 5.01. Establishment of Collateral Account, etc.
For purposes of the Liquidity Agreement, the CP Enhancement Letter of Credit
Application and Agreement and the Depositary Agreement, the Collateral Agent
shall at all times during the term of this Collateral Agreement maintain at a
U.S. branch or agency of Bankers Trust Company (i) a segregated trust account
for the benefit of the Secured Parties (said account being herein called the
"Collateral Account" and being identified as Account 25290), (ii) a segregated
trust account for the benefit of the Secured Parties (said account being herein
called the "Termination Advance Account" and being identified as Account
25292), (iii) a segregated trust account for the Liquidity Lenders and the
Liquidity Agent (said account being herein called the "Liquidity Lender
Account" and being identified as Account 25293), and (iv) a segregated trust
account for the benefit of the Secured Parties (said account being herein
called the "Series 1998-1 Pledge Account" and being identified as Account
25294), the operation of each of which shall be governed by this Article V
(the Collateral Account, the Termination Advance Account, the Liquidity Lender
Account and the Series 1998-1 Pledge Account are collectively referred to
herein as the "Accounts").
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It is understood and agreed by DTFC and the Secured Parties that on
any Business Day there shall be deposited in the Collateral Account the
following monies, instruments, cash and proceeds received by the Collateral
Agent or DTFC at any time and from time to time: (a) from the Depositary from
the sale of Commercial Paper Notes to the extent in excess of maturing
Commercial Paper Notes, (b) as payments on the Series 1998-1 Notes and any
other proceeds of the Assigned Collateral, (c) from the Enhancement Agent as
LOC Liquidity Disbursements, and (d) any and all moneys at any time and from
time to time received on behalf of DTFC, and required by the terms of this
Collateral Agreement or any other CP Program Document to be deposited in the
Collateral Account.
It is further understood and agreed by DTFC and the Secured Parties
that there shall be deposited in the Termination Advance Account the monies,
instruments, cash and proceeds received by the Collateral Agent or DTFC at any
time and from time to time from any Liquidity Lender pursuant to Section 3.6.3
of the Liquidity Agreement.
It is further understood and agreed by DTFC and the Secured Parties
that there shall be deposited in the Liquidity Lender Account or the Commercial
Paper Account the following monies, instruments, cash and proceeds received by
the Collateral Agent or DTFC at any time and from time to time: (a) from any
Liquidity Lender pursuant to Section 3.6.1 or 3.6.2 of the Liquidity Agreement
and (b) any and all monies at any time and from time to time received on behalf
of DTFC, and required by the terms of this Collateral Agreement, the Liquidity
Agreement or any other CP Program Document to be deposited in the Liquidity
Lender Account or the Commercial Paper Account.
All monies, instruments, cash and proceeds deposited at any time and
from time to time in any and all of the Accounts and the Series 1998-1 Cash
Collateral Account (other than amounts on deposit in the Series 1998-1 Cash
Collateral Account constituting earnings on investments or interest on
withdrawals and any amounts in excess of the Minimum Enhancement Amount that
are to be released pursuant to Section 4.18(d) of the Series 1998-1 Supplement)
are referred to as "Deposited Funds"; provided that (i) Deposited Funds in the
Series 1998-1 Cash Collateral Account may only be used for the purposes
provided in Section 4.18 of the Series 1998-1 Supplement and shall be under the
sole dominion and control of the Trustee and subject to Section 4.18 of the
Series 1998-1 Supplement, (ii) Deposited Funds in the Termination Advance
Account may only be used to make payments pursuant to clause Second of Section
2.01 or Section 5.02(b)(i) hereof, and (iii) the Deposited Funds in the Series
1998-1 Pledge Account may only be used for the purposes provided in Section 2.5
of the Liquidity Agreement (A) to make payments pursuant to clause Second of
Section 2.01 and to the extent a Borrowing Base Deficiency continues to exist,
to make payments pursuant to clause Fifth of Section 2.01 and (B) to make
payments pursuant to Section 5.02(b)(i) and, to the extent a Borrowing Base
Deficiency continues to exist, to make payments pursuant to Section 5.02
(b)(iv). Subject to Section 4.18 of the Series 1998-1 Supplement, Deposited
Funds may, at DTFC's discretion upon DTFC's written direction and at DTFC's
expense, be
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invested in Eligible Investments; provided that if a Liquidity Agreement
Amortization Event (other than a Scheduled Liquidity Agreement Amortization
Event) shall have occurred and be continuing or any DTFC Obligations then due
shall be unpaid, DTFC's rights to invest shall terminate and the Collateral
Agent shall have the right (but not the obligation) to invest funds at DTFC's
expense in Eligible Investments.
In addition, DTFC agrees that it will not, and will not permit any
Person on behalf of DTFC to, issue Commercial Paper Notes after DTFC has
received notice that any of the Accounts or the Series 1998-1 Cash Collateral
Account is subject to any stay, writ, judgment, warrant of attachment,
execution or other similar process; provided that if any such writ, order,
judgment, warrant of attachment, execution or other similar process is removed
or dismissed, DTFC may recommence issuing, and permitting any Person on behalf
of DTFC to issue, Commercial Paper Notes.
SECTION 5.02. Assignment of Accounts, etc. (a) In order to
secure and provide for the repayment and payment of the DTFC Obligations, DTFC
hereby assigns, pledges, grants, transfers and sets over to the Collateral
Agent, for the benefit of the Secured Parties, all of DTFC's right, title and
interest in and to the following (whether now or hereafter existing and whether
now owned or hereafter acquired): (i) the Accounts and the Series 1998-1 Cash
Collateral Account and all claims of DTFC in and to the Accounts and the Series
1998-1 Cash Collateral Account, (ii) the Deposited Funds and all claims of DTFC
in and to the Deposited Funds, (iii) all certificates and instruments, if any,
representing or evidencing any or all of the Accounts or the Series 1998-1 Cash
Collateral Account, (iv) all interest, dividends, cash, instruments and other
property from time to time, received, receivable or otherwise distributed in
respect of or in exchange for any or all of the Accounts or the Series 1998-1
Cash Collateral Account, the Deposited Funds or the Eligible Investments and
all claims of DTFC therein and thereto, (v) all Eligible Investments made at
any time and from time to time with the moneys in any and all of the Accounts
or the Series 1998-1 Cash Collateral Account and all claims of DTFC therein and
thereto and (vi) all proceeds of any and all of the foregoing, including,
without limitation, cash. Throughout the term of this Collateral Agreement,
the Collateral Agent shall be a pledgee in possession of the Deposited Funds
and shall have the sole and exclusive right to withdraw or order a transfer of
Deposited Funds from the Accounts subject to the provisions of the next
succeeding paragraph, and DTFC hereby appoints the Collateral Agent the true
and lawful attorney of DTFC, with full power of substitution, for the purpose
of making any such withdrawal or ordering any such transfer of Deposited Funds
from any of the Accounts and from the Series 1998-1 Cash Collateral Account,
which appointment is coupled with an interest and is irrevocable subject to
DTFC's right to remove the Collateral Agent as described in Section 7.04 of
this Collateral Agreement.
(b) So long as no Liquidity Agreement Amortization Event shall
have occurred and then be continuing, DTFC, with respect to clauses (ii) and
(iv) through (viii) below, and the Depositary with respect to clause (i) below,
and the Liquidity Agent, on behalf of the Liquidity
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Lenders, with respect to clause (iii) below, shall have the right to instruct
the Collateral Agent in writing to withdraw or allocate and retain, or order
the transfer of, Deposited Funds from any of the Accounts (subject to the
penultimate paragraph of Section 5.01 with respect to the Series 1998-1 Pledge
Account and the Termination Advance Account), from time to time as necessary,
for deposit into the Group II Collection Account or for the following purposes
in the following priority:
(i) the payment of all Indebtedness, at any time and from
time to time due from DTFC to the Holders of the Outstanding
Commercial Paper Notes issued pursuant to and in accordance with the
Depositary Agreement;
(ii) the payment of all (a) operating and ordinary course
expenses of DTFC up to an aggregate amount equal to $100,000 per annum
and (b) fees and expenses at any time and from time to time due to the
Depositary pursuant to Sections 8(a) and 8(b) of the Depositary
Agreement or due to the Collateral Agent hereunder to the extent no
Borrowing Base Deficiency results;
(iii) the payment of all amounts at any time and from time
to time notified by the Liquidity Agent to the Collateral Agent
pursuant to Section 3.6.5 of the Liquidity Agreement;
(iv) the payment, pro rata, of all principal Indebtedness
(including Commitment Termination Date Liquidity Advances) at any time
and from time to time due (in the case of a Commitment Termination
Date Liquidity Advance, such Advance will be deemed to be due for
purposes of this Section 5.02(b)(iv) on the date such Advance is made)
from DTFC (a) to the Liquidity Lenders in connection with the
Liquidity Advances made pursuant to the Liquidity Agreement, and (b)
to the Series 1998-1 Letter of Credit Provider (or, if applicable, to
the Series 1998-1 Cash Collateral Account) in connection with moneys
drawn under the Series 1998-1 Letter of Credit (or withdrawn from the
Series 1998-1 Cash Collateral Account) to fund any LOC Liquidity
Disbursements, together with all amounts payable in respect of
interest on any of the foregoing, together with all amounts payable in
respect of interest on any of the foregoing;
(v) to the extent no Borrowing Base Deficiency results
therefrom, the payment, pro rata, of all other Indebtedness
(including, but not limited to, fees, reimbursements, indemnities,
taxes and increased costs, but excluding amounts referenced in clause
(vi) below) at any time and from time to time due and owing to the
Liquidity Lenders, the Series 1998-1 Letter of Credit Provider (solely
with respect to amounts due from DTFC under the CP Enhancement Letter
of Credit Application and Agreement), the Liquidity Agent and the
Collateral Agent and the payment, pro rata, of any other amounts
(excluding those referenced in clause (vi) below) at any time and
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from time to time due from DTFC to any of them under or in respect of
the Liquidity Agreement, the Series 1998- 1 Letter of Credit, the CP
Enhancement Letter of Credit Application and Agreement, and this
Collateral Agreement, together with all amounts due from DTFC in
respect of interest thereon, and the payment, pro rata, of all
indemnities at any time and from time to time due from DTFC hereunder
to the Liquidity Lenders or the Series 1998-1 Letter of Credit
Provider, it being understood that amounts payable under this clause
(v) shall relate exclusively to costs and expenses incurred in or in
connection with this Collateral Agreement, the procurement and
handling of funds and the making of such funds available to or for the
account or benefit of DTFC and shall not include amounts payable in
connection with general indemnity claims relating to the use by DTFC
or the Series 1998-1 Letter of Credit Provider of the proceeds of such
financial accommodations (other than, in the event such actions give
rise to breakage costs, any action in the nature of a prepayment by
DTFC) or actions taken or omitted to be taken by DTFC under the CP
Program Documents and not directly related to the procurement of
funds, all of which shall be covered by clause (vi) below;
(vi) to the extent no Borrowing Base Deficiency results
therefrom, the repayment, pro rata, of all reasonable amounts advanced
or expended by the Collateral Agent, the Liquidity Agent, any
Liquidity Lender or the Series 1998-1 Letter of Credit Provider
hereunder or in connection with the Liquidity Agreement or the Series
1998-1 Letter of Credit or the CP Enhancement Letter of Credit
Application and Agreement (solely with respect to amounts due from
DTFC under the CP Enhancement Letter of Credit Application and
Agreement), as the case may be, and any other amounts and reasonable
out-of-pocket costs and expenses due from DTFC to any Secured Party
under or in connection with this Collateral Agreement, the Liquidity
Agreement, the Series 1998-1 Letter of Credit, the CP Enhancement
Letter of Credit Application and Agreement, the Depositary Agreement
or the Dealer Agreement whether in respect of indemnities thereunder
or otherwise;
(vii) to the extent no Borrowing Base Deficiency results
therefrom, the payment of all other expenses of DTFC in excess of the
amounts paid under clause (ii) above;
(viii) the making of further Advances by DTFC under the Note
Purchase Agreement for the purchase of the Series 1998-1 Invested
Amount; and
(ix) the balance of such Deposited Funds shall be retained
in the appropriate Account and invested pursuant to Section 5.04 in
Eligible Investments.
(c) The Collateral Agent shall apply moneys as provided in Section
5.02(b) promptly upon receipt of written or telephonic instructions from a DTFC
Agent or, with
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respect to clause (b)(i) above, a Depositary Agent, or with respect to clause
(b)(iii) above, the Liquidity Agent. Any telephonic instructions shall be
promptly confirmed in writing. The Collateral Agent shall make the required
withdrawals and transfers on the same day provided that it shall have received
instructions prior to 2:00 p.m. (New York City time) on such day. Absent
manifest error, the Collateral Agent shall have no responsibility for verifying
that moneys being transferred pursuant to this Section 5.02 are in the proper
amounts or that any conditions to such transfers are complied with. All
instructions furnished to the Collateral Agent pursuant to this Section 5.02(c)
or 5.03 shall specify the account to which moneys are to be transferred;
provided that moneys payable to any Liquidity Lender shall be transferred to
the Liquidity Agent for distribution to such Liquidity Lender.
(d) The Collateral Agent shall, with the cooperation of the
Depositary and the Liquidity Agent, monitor the amount of Outstanding
Commercial Paper Notes, Outstanding Liquidity Advances (to be provided by the
Liquidity Agent), and the current Borrowing Base and CP Borrowing Base (each of
which is to be provided by DTFC), and determine whether or not a Borrowing Base
Deficiency or CP Borrowing Base Deficiency exists on any Business Day. In this
regard, DTFC hereby agrees to provide the Collateral Agent and the Liquidity
Agent, (i) on or prior to the fifth (5th) Business Day of each month, a
statement reflecting the Borrowing Base as of the close of business on the last
day of the immediately preceding Related Month and (ii) promptly upon request
from the Collateral Agent or the Liquidity Agent, but in no event more than
three (3) Business Days from the date of such request, a statement reflecting
the Borrowing Base as of the close of business on the fifth (5th) Business Day
prior to the delivery of such statement, which statement shall, in each case,
be certified by the chief financial officer of DTFC. DTFC shall provide copies
of such monthly statement to each Rating Agency and the Dealers. Upon each
occasion that DTFC delivers a Borrowing Base Certificate to the Liquidity Agent
in accordance with the Liquidity Agreement, DTFC shall provide a copy of such
Certificate to the Collateral Agent hereunder. The Collateral Agent may
conclusively rely on such certified statement or certificate at all times from
and after the issuance thereof until issuance of a new such certified statement
or certificate, without any obligation on the part of the Collateral Agent to
confirm the truth, accuracy or completeness of such certified statement or
certificate and without any obligation on the part of the Collateral Agent to
undertake any other inquiry with respect thereto. Upon each occasion that DTFC
delivers information relating to the Borrowing Base to the Depositary in
accordance with Section 3(a) of the Depositary Agreement, DTFC shall provide a
copy of the notice containing such information to the Collateral Agent
hereunder. DTFC agrees to notify the Collateral Agent promptly, and in any
event within one Business Day, upon its obtaining knowledge of the existence of
any Borrowing Base Deficiency or CP Borrowing Base Deficiency.
(e) The Collateral Agent shall from time to time, but at least
monthly, provide DTFC with statements of account relating to the Accounts and
the Series 1998-1 Cash
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Collateral Account in accordance with the Collateral Agent's customary
practices and in a form reasonably satisfactory to the Collateral Agent and
DTFC.
(f) Upon the occurrence and during the continuance of a Liquidity
Agreement Amortization Event, all rights of DTFC to request the Collateral
Agent to withdraw or order the transfer of Deposited Funds from the Accounts or
the Series 1998-1 Cash Collateral Account shall cease, and the Collateral
Agent, at the direction (which direction shall be in writing or by telephone
(confirmed in writing promptly thereafter)) of the Required Liquidity Providers
shall (subject to Section 7.01 hereof), at any time and from time to time,
appropriate and apply the Deposited Funds then, or at any time thereafter, on
deposit in the Accounts or the Series 1998-1 Cash Collateral Account to the
payment or prepayment in full of all outstanding DTFC Obligations, whether or
not then due, in the order of priority specified in Section 2.01 hereof (or in
the case of the Series 1998-1 Cash Collateral Account, in accordance with
Section 4.18 of the Series 1998-1 Supplement). The Collateral Agent shall make
all payments with respect to Commercial Paper Notes outstanding pursuant to
clause Second of Section 2.01 to the Depositary for application to the pro rata
payment, in accordance with their terms and subject to the provisions of the
Depositary Agreement, of the face amount of matured and unmatured Commercial
Paper Notes, whether or not such Commercial Paper Notes have been presented to
the Depositary for payment.
SECTION 5.03. Application of Deposited Funds and Assigned
Collateral. For purposes of determining the payment to be made to any Person
of any Assigned Collateral and Deposited Funds pursuant to Sections 2.01 and
5.02 hereof, the Collateral Agent may rely on certificates or statements
furnished to or by it in accordance with the provisions of this Section 5.03;
provided, however, to the extent that the Collateral Agent has previously
received telephonic or written instructions with respect to determining the
payment to be made to any Person of any Assigned Collateral and Deposited Funds
pursuant to Section 5.02(c), the Collateral Agent may conclusively rely on such
previously received instructions. For purposes of determining the application
to be made of Deposited Funds and any Assigned Collateral to any Holder
pursuant to clause Second of Section 2.01 and clause (i) of Section 5.02(b) or
to the Depositary pursuant to clause First of Section 2.01, clause Eighth of
Section 2.01 or Section 5.02(b)(ii)(b), the Collateral Agent may rely
exclusively upon a certificate or other statement (a copy of which shall at the
same time also be provided to DTFC) of the Depositary as to the amount then
owing to such Holder. For purposes of determining the application to be made
of Deposited Funds and any Assigned Collateral to any Liquidity Lender, the
Liquidity Agent or the Series 1998-1 Letter of Credit Provider, pursuant to
clause Fourth, Fifth, Sixth or Eighth of Section 2.01 hereof (and the
corresponding provisions under Section 5.02(b)), the Collateral Agent may rely
exclusively upon a certificate or other statement (a copy of which shall at the
same time also be provided to DTFC) of the Liquidity Agent (with respect to
amounts owing to it or any Liquidity Lender) or the Series 1998-1 Letter of
Credit Provider, as the case may be, as to the amount then owing to any such
Liquidity Lender, the Liquidity Agent or the Series 1998-1 Letter of Credit
Provider, as the case may be. Any application to
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be made of Deposited Funds and Assigned Collateral to the Collateral Agent
pursuant to clause First or Seventh of Section 2.01 hereof (and the
corresponding provisions under Section 5.02(b)) may be made upon the Collateral
Agent's own certificate or statement delivered to DTFC and the Liquidity Agent,
setting forth in reasonable detail the nature of the Collateral Agent's claim
and the amount owing to the Collateral Agent on account thereof. For purposes
of determining the application to be made of Deposited Funds and Assigned
Collateral to DTFC pursuant to clause Third or Ninth of Section 2.01 or the
corresponding provisions under Section 5.02(b) hereof or to any Dealer or any
other Person (other than any party hereto or any Liquidity Lender) pursuant to
clause Eighth of Section 2.01 or the corresponding provisions under Section
5.02(b) hereof, the Collateral Agent may rely conclusively upon a certificate
or other statement of DTFC as to the amount then owing to DTFC or such other
party. The Collateral Agent shall not be liable for any application of the
Deposited Funds in accordance with any certificate or direction delivered
pursuant to this Section 5.03 or 5.02(c); provided, however, that no
application of the Deposited Funds and Assigned Collateral in accordance with
any certificate or statement delivered pursuant to this Section 5.03 or 5.02(c)
shall be deemed to restrict or limit the right of the Collateral Agent, DTFC,
the Liquidity Agent, the Depositary, any Liquidity Lender or any Dealer to
contest with the purported obligee its respective rights in respect of the
amount set forth in such certificate or statement.
SECTION 5.04. Eligible Investments. So long as no
Liquidity Agreement Amortization Event (other than a Scheduled Liquidity
Agreement Amortization Event) shall have occurred and be continuing and all
DTFC Obligations due and owing by DTFC have been paid, monies held in the
Accounts shall be invested daily, and the proceeds of investments shall be
reinvested daily, by the Collateral Agent in overnight Eligible Investments
pursuant to the written direction of DTFC and, in all other cases, such monies
and proceeds shall be invested daily and reinvested daily by the Collateral
Agent in accordance with the written direction of the Liquidity Agent. The
Trustee shall direct the investment of monies held in the Series 1998-1 Cash
Collateral Account in overnight Eligible Investments (or Eligible Investments
having longer maturities if (i) RCFC has consented thereto in the case of the
Series 1998-1 Cash Collateral Account and (ii) the Collateral Agent shall have
received written confirmation of the Rating Agencies that Eligible Investments
having such longer maturities will not result in the downgrading or withdrawal
of the then current ratings of the Commercial Paper Notes by the Rating
Agencies) at the direction of Master Servicer under the Master Lease with
respect to the Series 1998-1 Cash Collateral Account as provided in Section
4.18(c) of the Series 1998-1 Supplement; provided, however, that so long as a
Liquidity Agreement Amortization Event (other than a Scheduled Liquidity
Agreement Amortization Event) shall have occurred and be continuing, the
Liquidity Agent shall direct the investment of such monies as provided in the
Series 1998-1 Supplement. The Collateral Agent shall not be responsible or
liable for any loss resulting from the investment performance of any investment
or reinvestment of monies held in the Accounts or any other account maintained
by the Collateral Agent for the purposes of this Collateral Agreement or in
Eligible Investments or from the sale or liquidation of any Eligible
Investments in accordance with this Collateral
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Agreement. All Eligible Investments shall be made in the name of, and shall be
payable to, the Collateral Agent, and all investment costs and expenses shall
be reimbursed to the Collateral Agent by DTFC.
SECTION 5.05. Liquidity Demand; Commitment Termination
Demand. (a) Upon receipt by the Collateral Agent on or prior to 12:15 p.m.
(New York City time) of a written notice from DTFC notifying the Collateral
Agent of the existence and amount of a Commercial Paper Deficit and instructing
the Collateral Agent to deliver a Borrowing Request, the Collateral Agent
shall, by 12:30 p.m. (New York City time) on the date of such notice (or, in
the case of any notice given to the Collateral Agent after 12:15 p.m. (New York
City time), by 12:30 p.m. (New York City time) on the next following Business
Day), deliver a Borrowing Request in the form of Exhibit B to the Liquidity
Agreement to the Liquidity Agent for a Borrowing in the aggregate in the amount
of such Commercial Paper Deficit; provided that if on the date any Borrowing
Request is to be delivered by the Collateral Agent, Deposited Funds are
available in the Termination Advance Account, the Collateral Agent shall
immediately transfer to the Commercial Paper Account such Deposited Funds (up
to the amount of the relevant Commercial Paper Deficit) and reduce the amount
demanded in the Borrowing Request by the amount of the Deposited Funds so
transferred.
(b) So long as the Series 1998-1 Letter of Credit shall not have
been terminated, upon receipt by the Collateral Agent on or prior to 12:30 p.m.
(New York City time) of a written notice from the Depositary notifying the
Collateral Agent of the existence and amount of a Liquidity Deficiency and
directing the Collateral Agent to direct the Enhancement Agent to make a draw
under the Series 1998-1 Letter of Credit, the Collateral Agent shall, by 1:00
p.m. (New York City time) on the date of such notice (or, in the case of any
notice given to the Collateral Agent after 12:30 p.m. (New York City time), by
1:00 p.m. (New York City time) on the next following Business Day), direct the
Enhancement Agent to draw on the Series 1998-1 Letter of Credit in an amount
equal to the lesser of (i) such Liquidity Deficiency and (ii) the full amount
available to be drawn under the Series 1998-1 Letter of Credit on such date by
presenting a draft accompanied by a Certificate of Liquidity Demand in the form
of Annex B to the Series 1998-1 Letter of Credit. No such draw under the
Series 1998-1 Letter of Credit shall be made unless as of the date of such draw
and after giving effect to all Liquidity Advances made on such date under the
Liquidity Agreement, the Liquidity Agent shall notify the Collateral Agent by
telephone (promptly confirmed in writing) that the Aggregate Liquidity
Commitment is fully drawn under the Liquidity Agreement or is not available for
reasons other than a failure to meet conditions precedent.
(c) Upon receipt by the Collateral Agent on or prior to 12:15 p.m.
(New York City time) of a written notice from DTFC directing the Collateral
Agent to request a Commitment Termination Date Liquidity Advance from a
particular Liquidity Lender, the Collateral Agent shall by 12:30 p.m. (New York
City time) on the date of such notice (or, in the case of any notice given to
the Collateral Agent after 12:15 p.m. (New York City time), by 12:30 p.m.
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(New York City time) on the next following Business Day), deliver a Borrowing
Request in the form of Exhibit B to the Liquidity Agreement to the Liquidity
Agent for a Borrowing in the aggregate in the amount of such Commitment
Termination Date Liquidity Advance. DTFC agrees to give the Collateral Agent
notice of such direction so the Collateral Agent's Borrowing Request will be
delivered to the Liquidity Agent not less than three nor more than five
Business Days' before such Liquidity Lender's Scheduled Liquidity Commitment
Termination Date.
ARTICLE VI.
DEFAULT
SECTION 6.01. Rights of the Collateral Agent upon Liquidity
Agreement Amortization Event and Liquidation Event of Default. (a) Only if and
whenever a Liquidity Agreement Amortization Event shall have occurred and be
continuing, the Collateral Agent, at the direction (which direction shall be in
writing or by telephone (confirmed in writing promptly thereafter) specifying
the action to be taken) of the Required Liquidity Providers shall, from time to
time, withdraw amounts in the Accounts or cause the Enhancement Agent to
withdraw from the Series 1998-1 Cash Collateral Account for application as
provided in Section 5.02(f) and only if and whenever a Liquidity Agreement
Amortization Event (other than a Scheduled Liquidity Agreement Amortization
Event) shall have occurred and be continuing, the Collateral Agent, at the
direction (which direction shall be in writing or by telephone (confirmed in
writing promptly thereafter) specifying the action to be taken) of the Required
Liquidity Providers may also exercise from time to time any rights and remedies
available to DTFC under applicable law or any CP Program Document or DTFC
Agreement. DTFC agrees to enforce any rights it may have under the DTFC
Agreements and CP Program Documents at the direction of the Collateral Agent.
Any amounts obtained by the Collateral Agent on account of or as a result of
the exercise by the Collateral Agent of any right with respect to any funds at
any time and from time to time on deposit in, or otherwise to the credit of,
any of the Accounts, shall be held by the Collateral Agent as additional
collateral for the repayment of the DTFC Obligations and shall be applied as
provided in Section 2.01 hereof. The Collateral Agent agrees to undertake the
actions set forth with respect to the Collateral Agent in Section 9.2 of the
Liquidity Agreement.
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ARTICLE VII.
THE COLLATERAL AGENT, THE LIQUIDITY LENDERS,
AND THE HOLDERS
OF COMMERCIAL PAPER NOTES
SECTION 7.01. Appointment and Powers of Collateral Agent.
The Secured Parties hereby appoint the Collateral Agent their agent hereunder,
and hereby authorize the Collateral Agent to take such action on their behalf
and to exercise such rights, remedies, powers and privileges hereunder as are
specifically authorized to be exercised by the Collateral Agent by the terms
hereof, together with such rights, remedies, powers and privileges as are
reasonably incidental thereto. The parties hereto agree that the Collateral
Agent shall not be required to exercise any discretion or take any action or
refrain from taking any action in its capacity as agent for the Secured Parties
and DTFC, but shall only be required to act or refrain from acting in such
capacity (and shall be fully protected in so acting or refraining from acting)
upon the instruction of the Required Liquidity Providers or DTFC, as the case
may be, as provided herein. The Collateral Agent may execute any of its duties
as agent hereunder by or through agents or employees and shall be entitled to
retain experts and to act in reliance upon the advice of such experts
concerning all matters pertaining to the agencies hereby created and its duties
hereunder, and shall not be liable for any action taken or omitted to be taken
by it in good faith in accordance with the advice of such experts selected by
it. The relationship between the Collateral Agent and each of the Secured
Parties is that of agent and principal only, and nothing herein shall be deemed
to constitute the Collateral Agent a trustee for any of the Secured Parties or
impose on the Collateral Agent any obligations other than those for which
express provision is made herein.
If the Collateral Agent receives unclear or conflicting instructions,
it shall be entitled to refrain from taking action until clear or
non-conflicting instructions are received, but shall inform the instructing
party or parties promptly of its decision to refrain from taking such action.
Except as required by the specific terms of this Collateral Agreement, the
Collateral Agent shall have no duty to exercise any rights, power, remedy or
privilege granted to it hereby, or to take any affirmative action hereunder or
thereunder, unless directed to do so by the Required Liquidity Providers (and
shall be fully protected in acting or refraining from acting pursuant to such
directions which shall be binding on the Secured Parties), and shall not,
without the prior approval of the Required Liquidity Providers, waive any
default on the part of DTFC, RCFC or the Manufacturers with respect to the
Assigned Collateral or amend, modify, supplement or terminate, or agree to any
surrender of, this Collateral Agreement or the Assigned Collateral.
Notwithstanding anything herein to the contrary, the Collateral Agent shall not
be required to take any action which the Collateral Agent has reasonably
determined that a reasonable likelihood exists that such action will expose the
Collateral Agent to personal or financial liability, unless indemnified to its
satisfaction, or which is contrary to this
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Collateral Agreement, or any other agreement or instrument relating to the
Assigned Collateral or applicable law.
None of the Secured Parties nor any of its or their respective
directors, officers, employees or agents, shall be liable to any Secured Party
or any other Person for any action taken or omitted to be taken by it or them
hereunder, or in connection herewith, except for its or their own gross
negligence or willful misconduct; nor (except for its own due execution and
delivery thereof) shall the Collateral Agent be responsible to any Secured
Party for the validity, effectiveness, value, sufficiency or enforceability
against RCFC or DTFC of this Collateral Agreement or any other document
furnished pursuant hereto or in connection herewith, or of the Assigned
Collateral (or any part thereof), the Eligible Investments (or any part
thereof) or the Deposited Funds (or any part thereof). Without limiting the
generality of the foregoing, the Collateral Agent: (i) makes no warranty or
representation to any Secured Party and shall not be responsible to any Secured
Party for any statements, warranties or representations made by any other
Person in or in connection with this Collateral Agreement, the Series 1998-1
Supplement, the Vehicle Disposition Programs, the Liquidity Agreement, the
Master Lease or any other document relating to the Assigned Collateral; and
(ii) shall not have any duty to ascertain or to inquire as to the performance
or observance of any of the terms, covenants or conditions of this Collateral
Agreement, the Series 1998-1 Supplement, the Vehicle Disposition Programs, the
Liquidity Agreement, the Master Lease or any other agreements or instruments
relating to the Assigned Collateral on the part of any party hereto or thereto
or to inspect any books and records relating to the Assigned Collateral other
than as it determines reasonably necessary in the fulfillment of its own
obligations hereunder.
The Collateral Agent shall be entitled to rely on any communication,
instrument, paper or other document reasonably believed by it to be genuine and
correct and to have been given, signed or sent by the proper Person or Persons.
The Collateral Agent shall be entitled to assume that no Liquidity Agreement
Amortization Event shall have occurred and be continuing and that the Accounts,
and any funds on deposit in or to the credit of such Accounts, are not subject
to any writ, order, judgment, warrant of attachment, execution or similar
process (collectively a "writ"), unless (i) in the case of any writ, an officer
in the asset finance department of the Collateral Agent has actual knowledge
thereof or (ii) the Collateral Agent has received written notice from the
Liquidity Agent or RCFC under the Liquidity Agreement that the Majority Banks
consider that such a Liquidity Agreement Amortization Event has occurred or
such writ has been issued and continues to be in effect, which notice specifies
the nature thereof. The Collateral Agent may accept deposits from, lend money
to and generally engage in any kind of business with DTFC, any Manufacturer,
RCFC and their respective Affiliates as if it were not the agent of the
Liquidity Lenders and the Holders of Commercial Paper Notes. The Collateral
Agent shall have the right to refrain from taking any action under Article VI
hereof unless it has received written directions from the appropriate parties
to take such action.
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SECTION 7.02. Collateral Agents and Employees of the
Collateral Agent. (i) Each Liquidity Lender hereby agrees, in accordance with
its pro rata percentage of the sum of the Aggregate Liquidity Commitment under
the Liquidity Agreement, to indemnify and hold harmless the Collateral Agent
(which for purposes of this Section 7.02 shall include its officers, directors,
employees and agents) (to the extent not reimbursed by DTFC), from and against
any and all losses (other than the Collateral Agent's loss of profit),
liabilities (including, liabilities for penalties), actions, suits, judgments,
demands, damages, out-of-pocket costs and expenses of any kind whatsoever
(including, without limitation, reasonable fees and expenses of counsel and
other experts) incurred or suffered by the Collateral Agent in its capacity as
agent hereunder as a result of any action taken or omitted to be taken by the
Collateral Agent in such capacity or otherwise incurred or suffered by, made
upon, or assessed against the Collateral Agent in such capacity to the extent
not reimbursed by DTFC or by application of the Assigned Collateral; provided
that no Liquidity Lender shall be liable for any portion of any such losses,
liabilities, actions, suits, judgments, demands, costs or expenses resulting
from or attributable to gross negligence or willful misconduct on the part of
the Collateral Agent or its agents or employees. Without limiting the
generality of the foregoing, each Liquidity Lender hereby agrees, in the ratio
aforesaid, to reimburse the Collateral Agent promptly following its demand for
any out-of-pocket expenses (including, without limitation, reasonable fees and
expenses of counsel) incurred by the Collateral Agent hereunder and not
promptly reimbursed to the Collateral Agent by DTFC or by application of the
Assigned Collateral. The obligations of each Liquidity Lender under this
paragraph shall survive the termination of this Collateral Agreement and the
Liquidity Agreement and the discharge of DTFC's obligations thereunder. The
aggregate liability of the Liquidity Lenders hereunder for any claim shall be
limited to a percentage of the indemnity owing equal to the percentage that the
Aggregate Liquidity Commitment is of the Program Size. If at any time,
following its demand therefor, the Collateral Agent shall not be reimbursed by
DTFC or by the Liquidity Lenders, the Collateral Agent is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all amounts at any time held by the Collateral Agent for
the benefit of the Liquidity Lenders, including without limitation any such
amounts designated for disbursement to the Liquidity Lenders in accordance with
Section 2.01 or Section 5.02(b), against any and all of the obligations of the
Liquidity Lenders to the Collateral Agent now or hereafter existing under this
Collateral Agreement. The Collateral Agent agrees promptly to notify each
Liquidity Lender after any such set-off and application made by the Collateral
Agent, provided that the failure to give such notice shall not affect the
validity of such set- off and application. The rights of the Collateral Agent
under this Section are in addition to other rights and remedies which the
Collateral Agent may have. Any such set-off against amounts owed to Liquidity
Lenders by the Collateral Agent shall not cause a payment default of DTFC on
amounts due to such Liquidity Lenders to the extent funds are available in the
Accounts to be allocated to the payment of all amounts due to the Liquidity
Lenders in accordance with Section 2.01 or 5.02(b), as applicable.
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(a) No provision of this Collateral Agreement shall require the
Collateral Agent to expend or risk its own funds or otherwise incur any
financial or other liability in the performance of any duties hereunder or in
the exercise of any rights and powers hereunder.
(b) Any action or proceeding alleging any breach by the Collateral
Agent of duties under this Collateral Agreement shall be prosecuted only in the
courts of the State of New York located in the Borough of Manhattan, in New
York City or in the United States District Court for the Southern District of
New York. The Collateral Agent shall have the right at any time to seek
instructions from any court of competent jurisdiction. The Collateral Agent
may rely on the advice of counsel and shall be held harmless for actions taken
in reliance thereon.
(c) The Collateral Agent makes no representation as to, and shall
have no responsibility for, the correctness of any statement contained in, or
the validity or sufficiency of, this Collateral Agreement or any documents or
instruments referred to in this Collateral Agreement or the sufficiency or
effectiveness of any collateral assigned by this Collateral Agreement or as to
or for the validity or collectibility of any obligation contemplated by this
Collateral Agreement. The Collateral Agent shall not be accountable for the
use or application by any person of disbursements properly made by the
Collateral Agent in conformity with the provisions of this Collateral
Agreement.
(d) The Collateral Agent may exercise any of its duties hereunder
by or through agents or employees. The possession of the Assigned Collateral
by such agents or employees shall be deemed to be the possession of the
Collateral Agent.
(e) The provisions of this Section 7.02 shall survive the
termination of this Collateral Agreement or the resignation of the Collateral
Agent hereunder.
SECTION 7.03. Waiver of Jury Trial. EACH OF THE PARTIES
HERETO KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT
OF, UNDER, OR IN CONNECTION WITH, THIS COLLATERAL AGREEMENT OR ANY OTHER CP
PROGRAM DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE PARTIES HERETO IN CONNECTION
HEREWITH OR THEREWITH. EACH OF THE PARTIES HERETO ACKNOWLEDGES AND AGREES THAT
IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH
OTHER PROVISION OF EACH OTHER CP PROGRAM DOCUMENT TO WHICH IT IS A PARTY) AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES HERETO ENTERING
INTO THIS COLLATERAL AGREEMENT AND EACH SUCH OTHER CP PROGRAM DOCUMENT.
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SECTION 7.04. Successor Collateral Agent. The Collateral
Agent acting hereunder at any time may resign by an instrument in writing
addressed and delivered, 30 days prior to the effectiveness of such
resignation, to each Liquidity Lender, the Liquidity Agent, the Dealers, DTFC,
each Rating Agency and the Depositary, and may be removed at any time with or
without cause by an instrument in writing duly executed by or on behalf of the
Required Liquidity Providers with written notice to each of the Rating
Agencies. Subject to the provisions hereof, the Required Liquidity Providers
shall appoint, subject to the written consent of DTFC (which consent shall not
be unreasonably withheld), a successor to the Collateral Agent upon any such
resignation or removal, by an instrument of substitution complying with the
requirements of applicable law, or, in the absence of any such requirements,
without any formality other than appointment and designation in writing. Upon
the making and acceptance of such appointment, the execution and delivery by
such successor Collateral Agent of a ratifying instrument pursuant to which
such successor Collateral Agent agrees to assume the duties and obligations
imposed on the Collateral Agent by the terms of this Collateral Agreement, and
the delivery to such successor Collateral Agent of the Assigned Collateral, the
Deposited Funds and documents and instruments then held by the retiring
Collateral Agent, such successor Collateral Agent shall thereupon succeed to
and become vested with all the estate, rights, powers, remedies, privileges,
immunities, indemnities, duties and obligations hereby granted to or conferred
or imposed upon the retiring Collateral Agent named herein, and one such
appointment and designation shall not exhaust the right to appoint and
designate further successor Collateral Agents hereunder. No removal or
resignation of the Collateral Agent shall be effective unless and until a
successor Collateral Agent has been duly appointed, and the appointment of such
successor Collateral Agent has been accepted by such successor Collateral
Agent. No Collateral Agent shall be discharged from its duties or obligations
hereunder until the Assigned Collateral, the Deposited Funds and documents and
instruments then held by such retiring Collateral Agent shall have been
transferred or delivered to the successor Collateral Agent in its capacity as
bank or trust company, until all Deposited Funds held in the Accounts and the
Series 1998-1 Cash Collateral Account maintained with or in the name of the
retiring Collateral Agent shall have been transferred to the new Collateral
Account and until such retiring Collateral Agent shall have executed and
delivered to the successor Collateral Agent appropriate instruments assigning
the retiring Collateral Agent's interest in the Assigned Collateral, the
Accounts, the Series 1998-1 Cash Collateral Account, the Deposited Funds and
Eligible Investments to the successor Collateral Agent. If no successor
Collateral Agent shall be appointed, as aforesaid, or, if appointed, shall not
have accepted its appointment, within 30 days after notice of resignation or
removal of the retiring Collateral Agent, then, subject to the provisions
hereof, the retiring Collateral Agent may appoint a successor Collateral Agent
with the written consent of the Liquidity Agent and (so long as no Liquidity
Agreement Amortization Event (other than a Scheduled Liquidity Agreement
Amortization Event) then exists) DTFC, which consent shall not be unreasonably
withheld. Each such successor Collateral Agent shall provide DTFC, each
Liquidity Lender, the Liquidity Agent and the Depositary with its address, and
telephone, telecopy, telex, E-Mail (if applicable) and TWX numbers, to be used
for purposes of Section 9.04 hereof, in a notice
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complying with the terms of said Section. Notwithstanding the resignation or
removal of any Collateral Agent hereunder, the provisions of this Article VII
shall continue to inure to the benefit of such retiring Collateral Agent in
respect of any action taken or omitted to be taken by such retiring Collateral
Agent in its capacity as such while it was Collateral Agent under this
Collateral Agreement. DTFC shall provide prompt notice to each Rating Agency
of the appointment of a successor Collateral Agent.
SECTION 7.05. Qualifications of Collateral Agent. Any
Collateral Agent at any time acting hereunder must at all times be (i) the
corporate trust department of a bank or trust company having its principal
office in the District of Columbia or one of the states located in the United
States, or (ii) a bank or trust company having its principal office in the
District of Columbia or one of the states located in the United States,
authorized to accept deposits, or a branch office or agency of a foreign bank
located in the District of Columbia or one of the states of the United States,
in each case having short-term ratings from Moody's and S&P at least equal to
the rating such Rating Agency then assigns to the Commercial Paper Notes.
SECTION 7.06. Instructions of the Required Liquidity
Providers and Other Parties. In any instance in which the Collateral Agent is
permitted to take action hereunder, the Collateral Agent shall, except as
expressly provided herein or in the Liquidity Agreement, act in accordance with
the written instructions received, if any, from the Required Liquidity
Providers. All instructions and notices from the Required Liquidity Providers
shall be submitted to the Collateral Agent through the Liquidity Agent. All
instructions hereunder required to be given by the Majority Banks shall be
submitted to the Collateral Agent through the Liquidity Agent.
ARTICLE VIII.
AMENDMENTS, MODIFICATIONS, WAIVERS AND CONSENTS
SECTION 8.01. Execution of Amendments, etc. No amendment,
modification, supplement, termination or waiver of or to any provision of this
Collateral Agreement or the defined terms used herein and set forth in the
Definitions List, nor any consent to any departure by DTFC from any provision
of this Collateral Agreement, shall be effective unless the same shall be in
writing and signed on behalf of the Collateral Agent, the Liquidity Agent on
behalf of the Majority Banks, the Depositary, the Series 1998-1 Letter of
Credit Provider and DTFC; provided, however, that (i) the written consent of
all Liquidity Lenders shall be necessary to the extent that any such amendment,
modification, supplement, termination, waiver or consent (a) releases the
assignment given hereunder in respect of any of the Assigned Collateral or (b)
affects this Section 8.01 or Section 2.01 or 5.02 and (ii) such amendment,
modification, supplement, termination or waiver shall not result in the
downgrading or the withdrawal of the then current ratings of the Commercial
Paper Notes provided by the Rating
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<PAGE> 33
Agencies as evidenced by written confirmation from the Rating Agencies. Any
waiver of any provision of this Collateral Agreement, and any consent to any
departure by DTFC from the terms of any provision of this Collateral Agreement,
shall be effective only in the specific instance and for the specific purpose
for which given. No notice to or demand upon DTFC in any instance hereunder
shall entitle DTFC to any other or further notice or demand in similar or other
circumstances.
Notwithstanding the foregoing provisions of this Section 8.01, DTFC,
the Liquidity Agent and the Collateral Agent may, at any time and from time to
time, without the consent of the other Secured Parties, enter into any
amendment, supplement or other modification to this Collateral Agreement to
cure any apparent ambiguity or to correct or supplement any provision in this
Collateral Agreement that may be inconsistent with any other provision herein;
provided, however, that (i) any such action shall not have a material adverse
effect on the interests of the Liquidity Lenders and (ii) a copy of any such
amendment, supplement or other modification is furnished the other Secured
Parties, in accordance with the notice provisions hereof, not later than ten
days prior to the execution thereof.
ARTICLE IX.
MISCELLANEOUS
SECTION 9.01. Further Assurances. DTFC (i) from time to
time, at its expense, will promptly execute and deliver all further instruments
and documents, and take all further action, that may be necessary, as
reasonably requested by the Collateral Agent, in order to perfect and protect
any security interest granted or purported to be granted hereby or to enable
the Collateral Agent to exercise and enforce its rights and remedies hereunder
with respect to any Assigned Collateral, including without limitation, the
execution of financing or continuation statements, or amendments thereto and
(ii) hereby authorizes the Collateral Agent, if directed by the Secured
Parties, to file one or more financing or continuation statements, and
amendments thereto, relative to all or any part of the Assigned Collateral
without the signature of DTFC, where permitted by law. A carbon photographic
or other reproduction of this Assigned Collateral Agreement or any financing
statement covering the Assigned Collateral or any part thereof shall be
sufficient as a financing statement where permitted by law.
SECTION 9.02. No Waiver; Cumulative Remedies. No failure
on the part of the Collateral Agent to exercise, and no delay on the part of
the Collateral Agent in exercising any right, power or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right, power or remedy by the Collateral Agent preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
All remedies hereunder are cumulative and are not exclusive of any other
remedies that may be available to the Collateral Agent, whether at law, in
equity or otherwise.
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<PAGE> 34
SECTION 9.03. Notice of Amendments; Waivers. Notice of any
amendment, waiver or other change of the terms of the Assigned Collateral
(including, without limitation any model year changes in any Vehicle
Disposition Program) shall be sent by DTFC, promptly upon becoming aware
thereof, to each Rating Agency which shall be required to confirm their ratings
on the Commercial Paper Notes prior to the effectiveness thereof.
SECTION 9.04. Notices, etc. Except where telephonic
instructions or notices are authorized herein to be given, all notices,
demands, directions, instructions and other communications required or
permitted to be given to any party hereto shall be in writing and addressed,
delivered or transmitted to such party at its address or facsimile number set
forth below, or at any other address or facsimile number, as the case may be,
as such party may notify the other parties hereto in accordance with the
provisions of this Section 9.04; provided, however, all monthly statements
provided for in Section 5.02(d) hereof shall be sent by first class mail. Any
notice, if mailed and properly addressed with postage prepaid or if properly
addressed and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be deemed given when
transmitted upon receipt of electronic confirmation of transmission.
If to DTFC:
Dollar Thrifty Funding Corp.
5330 East 31st Street Tulsa,
Oklahoma 74135
Attention: Michael H. McMahon
Telephone: (918) 669-3914
Telecopier: (918) 669-2925
If to the Liquidity Agent:
Credit Suisse First Boston
Eleven Madison Avenue
New York, New York 10010-3629
Attention: Asset Finance Department
Telephone: (212) 325-9078
Telecopier: (212) 325-6677
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<PAGE> 35
If to the Depositary:
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attention: Commercial Paper Group
Telephone: (212) 250-3939
Telecopier: (212) 669-5970
If to the Collateral Agent:
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attention: Commercial Paper Group
Telephone: (212) 250-3939
Telecopier: (212) 669-5970
If to the Dealers:
Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010-3629
Attention: Short and Medium Term Finance Department
Telephone: (212) 325-7198
Telecopier: (212) 325-8183
Chase Securities Inc.
270 Park Avenue, 9th Floor
New York, New York 10017
Attention: Money Market Division
Telephone: (212) 834-5070
Telecopier: (212) 834-6560
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<PAGE> 36
If to the Series 1998-1 Letter of Credit Provider:
Credit Suisse First Boston
Eleven Madison Avenue
New York, New York 10010-3629
Attention: Short and Medium-Term Finance Department
Telephone: (212) 325-7198
Telecopier: (212) 325-8183
If to Moody's:
Moody's Investors Service, Inc.
99 Church Street
New York, New York 10007
Attention: ABS Monitoring Department
Telephone: (212) 553-0300
Telecopier: (212) 553-4773
If to S&P:
Standard & Poor's Ratings Group
25 Broadway
New York, New York 10001
Attention: Asset-Backed Surveillance Group
Telephone: (212) 208-8000
Telecopier: (212) 412-0225
If to DCR:
Duff & Phelps Credit Rating Co.
55 East Monroe Street, Suite 3800
Chicago, IL 60603
Attention: John Bella
Telephone: (312) 368-2058
Telecopier: (312) 263-2852
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<PAGE> 37
If to the other Liquidity Lenders, at the addresses set forth below
their signatures on the signature pages of the Liquidity Agreement, as such
addresses may be revised from time to time by written notice from such
Liquidity Lenders.
SECTION 9.05. Fee; Costs and Expenses, etc. DTFC shall pay
to the Collateral Agent as its fee for its services the amounts (which amounts
are subject to change as circumstances warrant) as set forth in the Fee Letter
set forth as Exhibit A hereto. DTFC hereby agrees to reimburse the Collateral
Agent for all reasonable out-of-pocket costs and expenses (including reasonable
counsel fees and expenses, but excluding costs and expenses solely attributable
to administrative overhead) incurred by the Collateral Agent in connection with
the administration and enforcement of this Collateral Agreement and agrees to
indemnify and hold harmless the Collateral Agent, the Depositary, the Liquidity
Agent and the Liquidity Lenders (which in each case for purposes of this
Section 9.05 shall include their respective officers, directors, employees and
agents) from and against any and all losses (other than loss of profit),
liabilities (including liabilities for penalties), actions, suits, judgments,
demands, reasonable out-of-pocket costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses but excluding costs and
expenses attributable solely to administrative overhead) incurred by the
Collateral Agent (in its capacity as Collateral Agent), the Depositary, the
Liquidity Lenders or the Liquidity Agent in connection with the administration
or enforcement of this Collateral Agreement and also agrees to pay, indemnify,
and to hold each Liquidity Lender, the Collateral Agent, the Liquidity Agent
and the Depositary harmless from, any and all recording and filing fees and any
and all liabilities with respect to, or resulting from any delay in paying,
stamp and other taxes, if any, which may be payable or determined to be payable
in connection with the execution and delivery of, or consummation of any of the
transactions contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, this Collateral Agreement;
provided, however, that DTFC shall not be required to indemnify any Secured
Party for any such loss, liability, action, suit, judgment, demand, cost or
expense due to willful misconduct or gross negligence on the part of such
Secured Party or its respective agents or employees. If DTFC shall fail to do
any act or thing which it has covenanted to do hereunder or any representation
or warranty on the part of DTFC contained herein or repeated and reaffirmed
herein shall be breached, the Collateral Agent may, with the consent of the
Required Liquidity Providers, but shall not be required to, do the same or
cause it to be done or remedy any such breach, and may expend its funds for
such purpose. Any and all amounts so expended by the Collateral Agent shall be
repayable to it by DTFC upon the Collateral Agent's demand therefor. The
obligations of DTFC under this Section 9.05 shall survive the termination of
this Collateral Agreement, the resignation or removal of any of the Secured
Parties and the discharge of the other obligations of DTFC hereunder and shall
also survive the termination of the Aggregate Liquidity Commitment of the
Liquidity Lenders and the termination of the Series 1998-1 Letter of Credit in
accordance with the provisions of the Liquidity Agreement and of the Series
1998-1 Letter of Credit, respectively.
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<PAGE> 38
SECTION 9.06. Collateral Agent Appointed Attorney-in-Fact.
DTFC hereby appoints the Collateral Agent its attorney-in-fact, with full power
of substitution, for the purpose of taking such action (including, without
limitation any action pursuant to Section 4.03 hereof) and executing
agreements, instruments and other documents, in the name of DTFC, as the
Collateral Agent or the Required Liquidity Providers may deem necessary or
advisable to accomplish the purposes hereof, which appointment is coupled with
an interest and is irrevocable.
SECTION 9.07. Termination; Assigned Collateral. This
Collateral Agreement, and any grants, pledges and assignments hereunder, shall
terminate when (a) all DTFC Obligations shall have been fully paid and
satisfied, (b) the Aggregate Liquidity Commitment of the Liquidity Lenders
under the Liquidity Agreement, the Series 1998-1 Letter of Credit Commitment
and related documents have terminated, and (c) the Series 1998-1 Letter of
Credit shall have terminated, at which time the Collateral Agent, at the
written request of DTFC and upon receipt of a certificate from DTFC to the
effect that the conditions in clauses (a), (b) and (c) above have been complied
with and upon receipt of a certificate from the Liquidity Agent and the
Depositary to the effect that the conditions in clauses (a), (b) and (c)
relating to DTFC Obligations to the Liquidity Lenders and the Holders of
Commercial Paper Notes have been complied with, shall reassign (without
recourse upon, or any warranty whatsoever by, the Collateral Agent), deliver at
DTFC's expense all Assigned Collateral and documents then in the custody or
possession of the Collateral Agent promptly to DTFC and execute such documents
and instruments as DTFC may reasonably request in connection with such
reassignment.
DTFC and the Secured Parties hereby agree that, if any Deposited Funds
remain on deposit in the Collateral Account after the termination of this
Collateral Agreement, such amounts shall be released by the Collateral Agent
and paid to DTFC.
SECTION 9.08. Governing Law; Binding Character; Assignment.
THIS COLLATERAL AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO OTHERWISE APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW. This Collateral Agreement shall be binding
upon and shall inure to the benefit of DTFC, the Liquidity Lenders, the
Liquidity Agent, the Depositary, the Holders of Commercial Paper Notes and the
Collateral Agent, and their respective successors and assigns; provided,
however, that DTFC may not assign any of its right hereunder or in connection
herewith or any interest herein (voluntarily, by operation of law or otherwise)
without the prior written consent of all of the Liquidity Lenders. This
Collateral Agreement shall not be construed so as to confer any right or
benefit upon any Person other than the parties to this Collateral Agreement,
the Liquidity Lenders and the Holders of the Commercial Paper Notes and each of
their respective successors and assigns.
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<PAGE> 39
SECTION 9.09. Severability of Provisions. Any provision of
this Collateral Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
SECTION 9.10. No Bankruptcy Petition Against DTFC. Each of
the Secured Parties hereby covenants and agrees that, prior to the date which
is one year and one day after the payment in full of the latest maturing
Commercial Paper Note, it will not institute against, or join with any other
Person in instituting against, DTFC, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any Federal or state bankruptcy or similar law; provided, however, that nothing
in this Section 9.10 shall constitute a waiver of any right to indemnification,
reimbursement or other payment from DTFC pursuant to this Collateral Agreement.
In the event that any such Secured Party takes action in violation of this
Section 9.10, DTFC agrees that it shall file an answer with the bankruptcy or
otherwise properly contest the filing of such a petition by any such Secured
Party against DTFC or the commencement of such action and raise the defense
that such Secured Party has agreed in writing not to take such action and
should be estopped and precluded therefrom and such other defenses, if any, as
its counsel advises that it may assert. The provisions of this Section 9.10
shall survive the termination of this Collateral Agreement, and the resignation
or removal of the Collateral Agent, the Liquidity Agent or the Depositary.
Nothing contained herein shall preclude participation by any Secured Party in
assertion or defense of its claims in any such proceeding involving DTFC.
SECTION 9.11. No Recourse. The obligations of DTFC under
this Collateral Agreement are solely the corporate obligations of DTFC. No
recourse shall be had for the payment of any amount owing in respect of Section
9.05 hereof or for the payment of any fee hereunder or any other obligation or
claim arising out of or based upon this Collateral Agreement against any
stockholder, employee, officer, director, Affiliate or incorporator of DTFC;
provided, however, that nothing in this Section 9.11 shall relieve any of the
foregoing Persons from any liability which such Person may otherwise have for
its gross negligence or willful misconduct. The provisions of this Section
9.11 shall survive the termination of this Collateral Agreement.
SECTION 9.12. Confidentiality. Each party hereto (other
than DTFC) agrees that it shall not disclose any Confidential Information to
any Person without the prior written consent of RCFC or DTFC. Notwithstanding
anything herein to the contrary, the foregoing shall not be construed to
prohibit any party hereto from (i) disclosing any and all information that is
or becomes publicly known through no fault of a Secured Party, (ii) disclosure
of any and all information (which makes reference to RCFC or DTFC or this
transaction) obtained by any Secured Party from sources (other than RCFC or
DTFC) that have not notified the Secured Party or Parties that such information
is subject to a confidentiality obligation with RCFC or
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<PAGE> 40
DTFC (iii) disclosing any and all information (A) if required to do so by any
applicable statute, law, rule or regulation, (B) to any government agency or
regulatory body having or claiming authority to regulate or oversee any aspects
of a Secured Party's business or that of its Affiliates, (C) pursuant to any
subpoena, civil investigative demand or similar demand or request of any court,
regulatory authority, arbitrator or arbitration to which any Secured Party or
an Affiliate or an officer, director or employee thereof is a party, (D) in any
preliminary or final offering circular, registration statement or contract or
other document pertaining to the transactions contemplated herein approved in
advance by RCFC or DTFC or (E) to any Affiliate, independent or internal
auditor, agent, employee or attorney of any Secured Party having a need to know
the same, provided that the Secured Party advises such recipient of the
confidential nature of the information being disclosed or (iv) any other
disclosure authorized by RCFC or DTFC.
"Confidential Information" means information that RCFC or DTFC
furnishes to a Secured Party on a confidential basis, but does not include any
such information that is or becomes generally available to the public other
than as a result of a disclosure by such Secured Party or other person to which
Secured Party delivered such information or that is or becomes available to
such Secured Party from a source other than RCFC or DTFC, provided that such
source is not (1) known to such Secured Party to be bound by a confidentiality
agreement with RCFC or DTFC, as the case may be, or (2) known to such Secured
Party to be otherwise prohibited from transmitting the information by a
contractual, legal or fiduciary obligation.
SECTION 9.13. Headings. Article and Section headings used
in this Collateral Agreement are for convenience of reference only and shall
not affect the construction of this Collateral Agreement.
SECTION 9.14. Execution in Counterparts. This Collateral
Agreement may be executed in any number of counterparts and by different
parties hereto on separate counterparts, each of which counterparts, when so
executed and delivered, shall be deemed to be an original and all of which
counterparts, taken together, shall constitute one and the same Collateral
Agreement.
SECTION 9.15. Limited Recourse to DTFC. The Collateral
Agent agrees that the obligations of DTFC to the Collateral Agent hereunder
shall be payable in the order and priority set forth in Section 2.01 and
5.02(b), as applicable, of this Collateral Agreement. Such obligations shall
be due and payable only to the extent that DTFC's assets and the Series 1998-1
Letter of Credit Commitment are sufficient to pay such obligations. No claims
of the Collateral Agent arising under or in connection with this Collateral
Agreement are intended to be impaired or waived by this Section 9.15.
SECTION 9.16. Waiver of Set-Off With Respect to DTFC. Each
of the Collateral Agent, the Depositary, the Series 1998-1 Letter of Credit
Provider and the Liquidity Agent
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<PAGE> 41
hereby waives and relinquishes any right (other than for its fees and expenses)
that it has or may have to set-off or to exercise any banker's lien or any
right of attachment or garnishment with respect to any funds at any time and
from time to time on deposit in, or otherwise to the credit of, any account and
any claims of DTFC therein or with respect to any right to payment from DTFC,
it being understood, however, that nothing contained in this Section 9.16
shall, or is intended to, derogate from the assignment and security interest
granted to the Collateral Agent under this Collateral Agreement or impair any
rights of the Secured Parties or the Collateral Agent hereunder or thereunder.
SECTION 9.17. Obligations of Collateral Agent Under the
Note Purchase Agreement. The Collateral Agent hereby acknowledges and agrees
to its duties and obligations set forth in the Note Purchase Agreement, as such
agreement may be amended, amended and restated, supplemented or otherwise
modified from time to time in accordance with the terms thereof.
[Remainder of Page Intentionally Blank]
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<PAGE> 42
IN WITNESS WHEREOF, the parties hereto have caused this Collateral
Agreement to be duly executed by their respective officers all as of the day
and year first above written.
DOLLAR THRIFTY FUNDING CORP.
By:
---------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON, as
Liquidity Agent and Series 1998-1
Letter of Credit Provider
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON CORPORATION,
as Dealer
By:
----------------------------------
Name:
Title:
<PAGE> 43
EXHIBIT A
Fee Letter
<PAGE> 1
EXHIBIT 4.18
EXECUTION COPY
DEALER AGREEMENT
THIS DEALER AGREEMENT, dated as of March 4, 1998 (as the same may be
amended, supplemented, amended and restated or otherwise modified from time to
time in accordance with the terms hereof, this "Agreement"), among DOLLAR
THRIFTY FUNDING CORP., an Oklahoma corporation ("DTFC" or the "Company"), DOLLAR
THRIFTY AUTOMOTIVE GROUP, INC., a Delaware corporation ("DTAG"), CREDIT SUISSE
FIRST BOSTON CORPORATION, a Massachusetts corporation ("CSFB"), as a dealer, and
CHASE SECURITIES INC., a Delaware corporation ("Chase"), as a dealer (each of
CSFB and Chase a "Dealer" and, together with any other dealers for Commercial
Paper Notes engaged by DTFC from time to time that agree to become parties
hereto and to the Collateral Agreement (such capitalized term and the other
capitalized terms used and not defined herein shall have the meanings assigned
thereto pursuant to Section 1 hereof), collectively, the "Dealers").
W I T N E S S E T H:
WHEREAS, the Company has requested each Dealer to act as a commercial
paper dealer for the Company's secured notes with maturities of up to 58 days
from date of issue (collectively, the "Commercial Paper Notes").
WHEREAS, the Commercial Paper Notes will be represented by either
individual note certificates in physical form ("Certificated Notes") or a master
note (the "Master Note") issued by the Company pursuant to that certain
Depositary Agreement, dated as of March 4, 1998, between the Company and Bankers
Trust Company, a New York banking corporation, as Depositary (as the same may be
amended, supplemented, amended and restated or otherwise modified from time to
time in accordance with the terms thereof and in effect, the "Depositary
Agreement"). Commercial Paper Notes represented by a master note shall be
referred to herein as "Book-Entry Notes". Certificated Notes shall be issued
substantially in the form of Exhibit A to the Depositary Agreement, while the
Master Note shall be issued substantially in the form of Exhibit E to the
Depositary Agreement.
WHEREAS, each Dealer has indicated its willingness to act as dealer for
the Commercial Paper Notes, subject to the satisfactory completion of such
investigation and inquiry into the Company's business as each Dealer deems
appropriate under the circumstances.
NOW THEREFORE, in consideration of the premises and the agreements
herein contained, and for due and adequate consideration which the parties
hereto hereby acknowledge, the parties hereto hereby agree as follows:
1. Certain Definitions. For all purposes of this Agreement, except as
otherwise expressly provided herein or unless the context otherwise requires,
capitalized terms not otherwise defined herein shall have the meanings assigned
to such terms in, or incorporated by reference into,
<PAGE> 2
(i) the Definitions List attached as Annex A to that certain Liquidity
Agreement, dated as of March 4, 1998 (as the same may be amended, restated,
supplemented or otherwise modified from time to time in accordance with the
terms thereof, the "Liquidity Agreement"), among the Company, certain financial
institutions as Liquidity Lenders and Credit Suisse First Boston, a Swiss
banking corporation, as the Liquidity Agent for the Liquidity Lenders, as such
Definitions List may be amended, supplemented, amended and restated or otherwise
modified from time to time in accordance with the terms of the Liquidity
Agreement, (ii) the Series 1998-1 Supplement, dated as of March 4, 1998 (as the
same may be amended, restated, supplemented or otherwise modified from time to
time in accordance with the terms thereof, the "Series 1998-1 Supplement"),
between Rental Car Finance Corp., an Oklahoma corporation ("RCFC"), as issuer,
and Bankers Trust Company, a New York banking corporation, as trustee (in such
capacity, the "Trustee") and enhancement agent (in such capacity, the
"Enhancement Agent"), to the Base Indenture, dated as of December 13, 1995 (as
amended as of December 23, 1997, and as the same may be further amended,
restated, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Base Indenture"), between RCFC and the Trustee, and
(iii) the Definitions List attached as Schedule 1 to the Base Indenture, as such
Definitions List may be amended, restated, supplemented or otherwise modified
from time to time in accordance with the terms of the Base Indenture, provided
that to the extent, if any, that any capitalized term used but not defined
herein has a meaning assigned to such term in more than one of the documents
referred to in clauses (i) though (iii) above, then (x) if a meaning is assigned
to such term in the Definitions List attached as Annex A to the Liquidity
Agreement, such meaning shall apply herein, and (y) if a meaning is not assigned
to such term in the Definitions List attached as Annex A to the Liquidity
Agreement, then the meaning assigned to such term in the Series 1998-1
Supplement shall apply herein.
2. Appointment as Dealer. (a) The Company hereby appoints the Dealers
as dealers for the Commercial Paper Notes and acknowledges that the Dealers
shall have the right to assist the Company in the sale or placement of the
Commercial Paper Notes during the term of this Agreement. The Company agrees
that during the period the Dealers are acting as the Company's dealers
hereunder, the Company shall not directly contact or solicit potential investors
to purchase the Commercial Paper Notes. The Company further agrees during such
period that it will not engage any person or party other than the Dealers to
assist in the sale or placement of the Commercial Paper Notes unless any such
additional dealer enters into an agreement with the Company that is in form and
substance substantially similar to this Agreement. The Company further agrees to
provide the Dealers with a copy of any such other agreement immediately
following the execution thereof. While the Dealers shall not have any obligation
to purchase, as principal, Commercial Paper Notes from the Company, or to offer
or sell any Commercial Paper Notes, under any circumstances, and while the
Company shall have no obligation to sell Commercial Paper Notes to, or to
arrange sales of Commercial Paper Notes through, the Dealers, each Dealer may,
from time to time, with the consent of the Company (oral or written), purchase
in its sole discretion Commercial Paper Notes, as principal, from the Company.
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<PAGE> 3
(b) The Company and each Dealer respectively agree that any Commercial
Paper Notes, the placement of which such Dealer arranges or which are purchased
by such Dealer, shall be placed or purchased by such Dealer in reliance on the
representations, warranties, covenants and agreements of the Company contained
herein or made pursuant hereto and on the terms and conditions and in the manner
provided herein. All transactions involving the Commercial Paper Notes between a
Dealer and the Company shall be in accordance with the generally accepted custom
and practice prevailing in the commercial paper market at such times.
(c) Upon receipt of instructions from the Company, each Dealer will
solicit purchases of such principal amount of the Commercial Paper Notes and
with such discounts, interest rates and maturities as the Company and such
Dealer shall agree upon from time to time during the term of this Agreement.
Such Dealer shall have no liability to the Company in the event any such
purchase is not consummated for any reason. Unless otherwise instructed by the
Company, each Dealer will periodically communicate to the Company, orally or in
writing, the aggregate purchase of Commercial Paper Notes arranged by such
Dealer with third party investors, other than offers rejected by such Dealer.
Each Dealer shall have the right, in its discretion reasonably exercised, to
reject any proposed purchase of Commercial Paper Notes, in whole or in part.
(d) The Company may instruct any Dealer to suspend solicitation of
purchases of Commercial Paper Notes at any time (other than Commercial Paper
Notes held by any Dealer as principal). Upon receipt of such instruction, such
Dealer will forthwith suspend solicitation until such time as the Company has
advised it that solicitation of purchases may be resumed.
3. Offers and Sales of the Commercial Paper Notes. The Commercial Paper
Notes are to be exempt from the registration requirements of the Securities Act
of 1933, as amended (the "Act"), pursuant to Section 3(a)(3) thereof. The
Dealers and the Company hereby establish the following procedures in connection
with the offer and sale or resale of the Commercial Paper Notes:
(a) No sale of Commercial Paper Notes to any one purchaser will be for
less than $100,000 face amount and no Commercial Paper Note will be issued in a
smaller face amount. If the purchaser is a non-bank fiduciary acting on behalf
of others, each person for whom it is acting must purchase at least $100,000
face amount of the Commercial Paper Notes.
(b) The Commercial Paper Notes will bear such interest rates (if
interest-bearing), or will be sold at such discounts from their face amounts, as
shall be mutually agreed to by the Company (after consultation with DTAG) and
the Dealers at the time of each proposed purchase or placement.
(c) The proceeds from the sale of the Commercial Paper Notes will be
used by the Company for current transactions within the meaning of Section
3(a)(3) of the Act.
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<PAGE> 4
(d) The Commercial Paper Notes will be issued by the Company in the
ordinary course of its business and financial affairs, will have a maturity at
the time of issuance of not more than fifty-eight (58) days (exclusive of days
of grace) and will not contain any provision for automatic "rollover".
(e) In connection with the offer and sale of the Commercial Paper Notes
from time to time, offering materials will be prepared by the Company, including
vehicle experience reports, a commercial paper offering memorandum (as
supplemented or otherwise modified or substituted or replaced from time to time,
the "Offering Memorandum") relating to the Company and the transactions
contemplated by the CP Program Documents. Such vehicle experience reports, the
Offering Memorandum and the audited balance sheets and statements of income,
retained earnings and cash flows of DTAG and its Subsidiaries on a consolidated
basis for the two most recent fiscal years with respect to which such
information is available and the notes thereto and the unaudited balance sheets
and statements of income, retained earnings and cash flows of DTAG and its
Subsidiaries on a consolidated basis as of the end of the most recent fiscal
quarter with respect to which such information is available and the
corresponding fiscal quarter for the immediately prior year, together with any
other documents approved by the Company for distribution to each purchaser or
prospective purchaser of the Commercial Paper Notes and all documents
incorporated therein are referred to collectively herein as the "Offering
Materials". Each Dealer shall make a copy of such Offering Materials available
to each purchaser or prospective purchaser of the Commercial Paper Notes. The
Offering Materials will describe, among other things, (i) the Commercial Paper
Notes, (ii) the proposed use of proceeds of sale of the Commercial Paper Notes,
(iii) the business of the Company, and (iv) the terms of and parties to the CP
Program Documents. All documents incorporated by reference into the Offering
Materials (if any) will be offered to each prospective purchaser of Commercial
Paper Notes at no charge. In connection with such Offering Materials and to
assist the normal credit review procedures of each Dealer, the Company agrees to
furnish such Dealer on a continuing basis with such information concerning the
business of the Company (including financial statements), the offering and sale
of the Commercial Paper Notes and the related transactions as such Dealer
reasonably requests, provided that such Dealer enters into a confidentiality
agreement substantially in the form of Exhibit A attached hereto (the
"Confidentiality Agreement"). Any such information may only be disclosed by any
of the Dealers (i) pursuant to the terms of the Confidentiality Agreement or
(ii) if (A) the party to whom such information is being disclosed signs a
confidentiality agreement substantially similar to the Confidentiality Agreement
and (B) such disclosure is approved by the Company.
(f) The Offering Materials will not be distributed by any Dealer unless
it is in a form satisfactory to such Dealer and the Company. No Dealer shall be
responsible for any inaccuracy in the Offering Materials except to the extent
such statement was provided in writing by such Dealer expressly for use in the
Offering Materials, provided that the parties acknowledge that the only
information provided by such Dealer for use in the Offering Materials is: with
respect to CSFB, Stephanie Gentile, Investor Marketing, Short- and Medium-Term
Finance Department, Credit Suisse First Boston, 11 Madison Avenue, New York, NY
10010, (212) 325-4713; and
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<PAGE> 5
with respect to Chase, Ronald Flynn, U.S. Money Market Division, Chase
Securities Inc., 270 Park Avenue, 8th Floor, New York, NY 10017,(212) 834-3435;
4. Representations and Warranties. (a) The Company represents and
warrants to each Dealer as of the date hereof and as of each date contemplated
by Section 5 hereof that:
(i) The Company (A) has been duly formed and is validly
existing as a corporation in good standing under the laws of the State
of Oklahoma and (B) has the requisite corporate power and authority to
execute and deliver this Agreement, the Commercial Paper Notes, the
Depositary Agreement, the Liquidity Agreement, the Collateral Agreement
and any other CP Program Document to which the Company is a party and
perform its obligations hereunder and thereunder and to own its
properties and conduct its business as described in the Offering
Memorandum.
(ii) The Company is not in violation of its organizational
documents and no Liquidity Agreement Amortization Event or Limited
Liquidity Agreement Amortization Event or, to the Company's knowledge
Potential Liquidity Agreement Amortization Event has occurred and is
continuing. The execution and delivery of this Agreement, the
Depositary Agreement, the Commercial Paper Notes and the other CP
Program Documents to which the Company is a party and the incurrence of
the obligations and consummation of the transactions herein
contemplated (i) will not conflict with, or constitute a breach of or
default under, the certificate of incorporation and by-laws of the
Company or any material contract, indenture, mortgage, loan agreement
or lease, to which the Company is a party or by which the Company may
be bound, or any law, administrative regulation or court decree
applicable to the Company and (ii) will not result in the creation or
imposition of any mortgage, lien, charge or encumbrance of any nature
whatsoever upon any of the properties or assets of the Company except
as contemplated thereby.
(iii) Each of this Agreement, the Depositary Agreement and the
other CP Program Documents to which the Company is a party has been
duly authorized, executed and delivered by the Company and constitutes
the legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, except as enforcement
thereof may be limited by bankruptcy, insolvency or other similar laws
relating to or affecting generally the enforcement of creditors' rights
or by general equitable principles.
(iv) The Commercial Paper Notes have been duly authorized for
issuance, offer and sale as contemplated by this Agreement and, when
issued and delivered against payment of the purchase price therefor,
will constitute legal, valid and binding obligations of the Company
enforceable against the Company in accordance with their terms, except
as enforcement thereof may be limited by bankruptcy, insolvency, or
other similar laws
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<PAGE> 6
relating to or affecting generally the enforcement of creditors'
rights or by general equitable principles.
(v) No consent, approval, authorization, order, registration
or qualification of or with any court or any regulatory authority or
other governmental agency or body (including the Securities and
Exchange Commission) is required for the issuance, offer or sale of the
Commercial Paper Notes by the Company in accordance with the terms of
this Agreement or for the consummation of the transactions contemplated
by this Agreement, the Depositary Agreement, the Commercial Paper Notes
and the other CP Program Documents.
(vi) There are no legal or governmental proceedings pending to
which the Company is a party or of which any property of the Company is
the subject, other than as set forth in the Offering Memorandum and
other than legal or governmental proceedings which, in each case, will
not have a Material Adverse Effect on the Company's ability to perform
its obligations under this Agreement, the Depositary Agreement, the
Commercial Paper Notes and each other CP Program Document; and to the
best of its knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(vii) The Company is not an "investment company", or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
(viii) The Commercial Paper Notes will be exempt from
registration under the Act pursuant to Section 3(a)(3) thereof.
Qualification of an indenture in respect to the Commercial Paper Notes
under the Trust Indenture Act of 1939, as amended, will not be required
in connection with the offer, issuance, sale or delivery of the
Commercial Paper Notes.
(ix) When issued in accordance with the Depositary Agreement,
the Commercial Paper Notes will rank at least pari passu with all other
senior secured indebtedness of the Company.
(x) All representations and warranties of the Company made in
the Depositary Agreement, the Liquidity Agreement and any other CP
Program Document to which the Company is a party are true and correct
in all material respects and are repeated herein as though fully set
forth herein.
(xi) The Offering Materials (including the documents
incorporated therein by reference) do not, and the Offering Materials
(including the documents incorporated by reference therein) as amended,
supplemented or otherwise modified or substituted or replaced from time
to time do not and will not contain any untrue statement of a material
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<PAGE> 7
fact or omit to state a material fact necessary to make the statements
contained therein, in the light of the circumstances under which they
were made, not misleading.
(b) DTAG represents and warrants to each Dealer as of the date hereof
and as of each date contemplated by Section 5 hereof that:
(i) DTAG (A) has been duly formed and is validly existing as a
corporation in good standing under the laws of the State of Delaware
and (B) has the requisite corporate power and authority to execute and
deliver this Agreement and each other CP Program Document to which DTAG
is a party and perform its obligations hereunder and thereunder.
(ii) Each of this Agreement and the other CP Program Documents
to which DTAG is a party has been duly authorized, executed and
delivered by DTAG and constitutes the legal, valid and binding
obligation of DTAG enforceable in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency or other
similar laws relating to or affecting generally the enforcement of
creditors' rights or by general equitable principles.
(iii) All representations and warranties of DTAG made in any
CP Program Document to which DTAG is a party are true and correct in
all material respects and are repeated herein as though fully set forth
herein.
5. Additional Representation and Warranty. Each acceptance by the
Company of an offer for the purchase of Commercial Paper Notes shall be deemed
an affirmation by the Company and (as to (i) and (iv) below) by DTAG that (i)
the representations and warranties of the Company and DTAG set forth in Section
4 hereof are true and correct at the time of such acceptance (except to the
extent such representations and warranties relate solely to an earlier date, in
which case such representations and warranties were true and correct as of such
earlier date), and an undertaking that such representations and warranties will
be true and correct at the time of delivery, to the purchaser or its agent of
the Commercial Paper Note or Commercial Paper Notes relating to such acceptance,
as though made at and as of such time (it being understood that insofar as such
representations and warranties relate to the Offering Materials, such
representations and warranties shall relate to the Offering Materials delivered
to prospective purchasers of Commercial Paper Notes at the time of such
acceptance and at the time of such delivery of the Commercial Paper Note or
Commercial Paper Notes relating to such acceptance, respectively), (ii) since
the date of the most recent Offering Materials, there has been no material
adverse change in the financial condition or operations of the Company which has
not been disclosed to the Dealers in writing, (iii) the conditions precedent to
the issuance of the Commercial Paper Notes set forth in the CP Program Documents
have been fulfilled and such Commercial Paper Notes are entitled to the benefits
of the Series 1998-1 Letter of Credit, the Liquidity Agreement, the Master
Collateral Agency Agreement and the Collateral Agreement, (iv) the
representations and warranties of the Company and DTAG set forth in the CP
Program
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<PAGE> 8
Documents are true and correct in all material respects on and as of such date
as if made on and as of such date (except to the extent such representations and
warranties relate solely to an earlier date, in which case such representations
and warranties were true and correct as of such earlier date) and (v) the
Company has performed all covenants and agreements contained in this Agreement
and the other CP Program Documents required to be performed by the Company on or
prior to such date.
6. Covenants. (a) The Company will supply to each Dealer, on a
continuing basis, (x) copies of all correspondence with, and all documents and
other information that the Company makes available to, Standard & Poor's Ratings
Services, a division of The McGraw Hill Companies ("S&P"), Moody's Investor
Service, Inc. ("Moody's") and Duff & Phelps Credit Rating Co. ("DCR") in
connection with the transactions contemplated hereby, consistent with the
Confidentiality Agreements to be entered into by the Dealers pursuant to this
Agreement, and by the other CP Program Documents and (y) three (3) copies of all
audited annual reports and all unaudited interim reports of DTAG supplied to the
Company by DTAG pursuant to the CP Program Documents.
(b) Pursuant to the Depositary Agreement, the Company will maintain a
segregated trust account in the corporate trust department at the Depositary
into which all of the proceeds of the sale of the Commercial Paper Notes (net of
commissions) will be deposited by the Depositary. Only (i) the net proceeds of
the sale of the Commercial Paper Notes and (ii) such funds as, together with the
proceeds of the Commercial Paper Notes, shall be necessary to make all payments
in respect of the Commercial Paper Notes, shall be deposited in such account,
which shall be maintained at the Depositary separate and apart from any other
account, but which may be subdivided into separate sub-accounts for bookkeeping
purposes. The Company will take all action necessary to ensure that the proceeds
from the sale of the Commercial Paper Notes will be used for purposes which meet
the "current transactions" requirements of Section 3(a)(3) of the Act.
(c) The Company will not use the proceeds of Commercial Paper Notes
purchased and held by a Dealer, as principal, for the purchase or carrying of
securities to the extent that such use would result in a violation of
Regulations G, T, U or X promulgated by the Board of Governors of the Federal
Reserve System.
(d) Without the prior written consent of each Dealer, the Company will
not permit to become effective (i) any amendment, supplement, rider, waiver,
termination, or consent to or under any Commercial Paper Note, the Depositary
Agreement or any other CP Program Document to which it is a party which might
adversely affect the interests of the holder of any Commercial Paper Notes then
outstanding (provided, that an amendment, supplement, rider, waiver,
termination, or consent relating to a change in the rating to "A-2" by S&P,
"P-2" by Moody's and "D-1-" by DCR shall become effective without the prior
written consent of each Dealer), provided that each Dealer is given sixty (60)
days prior written notice), or (ii) the assignment of the Company's rights under
any Commercial Paper Note, the Depositary
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<PAGE> 9
Agreement or any other CP Program Document. The Company will give the Dealers
written notice of any such proposed amendment, supplement, rider, waiver,
termination, consent or assignment at least ten days prior to the effective date
thereof, and will furnish prior notice to the Dealers of any proposed
resignation, termination or replacement of the Depositary. The Company agrees
promptly to provide each of the Dealers with copies of any amendment,
supplement, rider, waiver, termination, or consent to or under any Commercial
Paper Note, the Depositary Agreement or any other CP Program Document.
(e) The Company will immediately notify each Dealer of any downgrade of
which it has knowledge, or notice received by the Company of a potential
downgrade, in the rating of the Commercial Paper Notes, in any event prior to
any subsequent issuance of Commercial Paper Notes, and will promptly send to
each Dealer a copy of any notice or letter to that effect from S&P, Moody's or
DCR.
(f) The Company will use good faith efforts to arrange for the
qualification of the Commercial Paper Notes for sale under the state securities
or "blue sky" laws of such jurisdictions in the United States as any Dealer may
reasonably request in writing and will maintain such qualification in effect as
long as required for the distribution of the Commercial Paper Notes in such
jurisdiction; provided, however, that the Company shall not be required to
become subject to service of process or franchise taxation as a foreign
corporation in any jurisdiction where it was not theretofore so subject.
(g) The Company agrees to update the Offering Materials as necessary so
that at the time of each sale by a Dealer of Commercial Paper Notes, the
Offering Materials, as so updated, will not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Each of DTAG and the Company shall promptly inform each of the
Dealers if any event occurs or condition exists which makes it necessary to
revise, amend or supplement the Offering Materials in order that the Offering
Materials will not contain an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading. Prior to
any offer or sale of Commercial Paper Notes, each Dealer shall, with the
cooperation and consent of DTAG and the Company have the right to make such
reasonable due diligence investigation of the business of DTAG and the Company
as is usual in the course of continuous offerings of commercial paper.
(h) The Company has credit facilities under the Liquidity Agreement and
the Series 1998-1 Letter of Credit and will at all times maintain in effect
committed credit facilities and/or cash collateral accounts with unutilized
available amounts thereunder not less than the principal (plus interest, if any,
to maturity) amount of outstanding Commercial Paper Notes and will advise, and
cause the Collateral Agent to advise the Dealers, as frequently as the Dealers
may request, of the status and usage of such credit facilities.
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<PAGE> 10
(i) The Company will provide each Dealer with each notice or copy of
notice required to be provided by the Company to the Dealers under this
Agreement or any other CP Program Document.
(j) For the period commencing on the date hereof and ending the date
that is one year and one day after the date upon which all Commercial Paper
Notes are paid in full, the Company agrees that each contract to which the
Company is or will be a party (other than contracts for trade payables or
contracts arising in connection with other ordinary operating expenditures)
shall include a provision pursuant to which each party thereto shall agree that,
prior to the close of such period, it will not institute against, or join any
other person in instituting against, the Company any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceeding, or other proceeding under any
bankruptcy or similar law.
(k) Without limiting any obligation of the Company pursuant to this
Agreement to provide the Dealers with credit and financial information, the
Company hereby acknowledges and agrees that each Dealer may share and exchange
Offering Materials and any other information or matters relating to the Company
or the transactions contemplated hereby with any of its Affiliates, consistent
with the Confidentiality Agreements to be entered into by the Dealers pursuant
to this Agreement, in the following circumstances: (1) for approving lines of
credit, drawings or borrowings thereunder, and (2) in connection with commercial
paper underwriting, arrangement or sale.
7. Conditions Precedent to Sale or Placement of the Commercial Paper
Notes. (a) Prior to the initial sale of Commercial Paper Notes hereunder, the
Company shall cause to be delivered to each Dealer (i) written opinions of
counsel to the Company, DTAG and the Series 1998-1 Letter of Credit Provider in
form reasonably acceptable to such Dealer, (ii) a certificate of the Secretary
or other appropriate officer of each of the Company and DTAG certifying true
copies of the resolutions of the Company and DTAG, respectively, approving this
Agreement, the Commercial Paper Notes, the Depositary Agreement and each other
CP Program Document to which the Company or DTAG is a party and the transactions
contemplated hereby and thereby and certifying the incumbency, authority and
true signatures of the officers of the Company and DTAG, respectively,
authorized to sign this Agreement, the Commercial Paper Notes, the Depositary
Agreement and each other CP Program Document to which the Company or DTAG is a
party, (iii) an original executed copy, photocopy or conformed copy of this
Agreement, the Depositary Agreement each other CP Program Document, which shall
be in form and substance reasonably acceptable to each Dealer, (iv) the letters
from the Rating Agencies regarding the ratings described in paragraph (b) below,
(v) a certified copy of the Company's certificate of incorporation and its
by-laws and (vi) true and correct copies any documents relating to Commercial
Paper Notes executed by the Company and The Depository Trust Company, and, in
connection with issuance of Commercial Paper Notes in book entry form, a copy of
the master note(s) evidencing Commercial Paper Notes.
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<PAGE> 11
(b) Prior to the initial sale of any Commercial Paper Notes hereunder,
such Commercial Paper Notes shall have been rated at least "A-1" by S&P, "P-1"
by Moody's and "D-1" by DCR, the Commercial Paper Notes shall be rated so by
each of S&P, Moody's and DCR upon each subsequent sale of Commercial Paper Notes
hereunder or shall be rated such other rating as may be acceptable to the
Dealers; provided, however, that the Dealers hereby agree that a rating of A- 2
by S&P, P-2 by Moody's and "D-1-" by DCR is acceptable if such rating results
solely from a downgrading of any Liquidity Lender by S&P, Moody's or DCR , as
the case may be; provided further, however, the Company and DTAG each agrees to
notify each of the Dealers in writing promptly following its receipt of notice
or actual knowledge of the downgrade or potential downgrade of any Liquidity
Lender with respect to the identity of such Liquidity Lender and what action if
any the Company is taking under Section 5.9(a) of the Liquidity Agreement to
replace such Liquidity Lender; provided further, however, the Company agrees to
exercise its right under Section 5.9(a) of the Liquidity Agreement to replace
any Liquidity Lender whose credit rating on its short-term debt has been
withdrawn or downgraded by S&P, Moody's or DCR (if rated by DCR). Such ratings
were obtained by the Company with the understanding that S&P, Moody's and DCR
would continue to monitor the credit of the Company and make future adjustments
in such ratings to the extent warranted.
(c) It will be a condition precedent to the initial issuance of any
Commercial Paper Notes and each subsequent issuance of Commercial Paper Notes
that the issuance of such Commercial Paper Notes will not cause the Company to
have a negative net worth. The Company will be responsible for monitoring its
net worth for purposes of this Section 7(c) and hereby agrees to notify each of
the Dealers promptly following its receipt of notice or actual knowledge that
the issuance of such Commercial Paper Notes will cause the Company to have a
negative net worth.
(d) Prior to the sale of the Commercial Paper Notes, the Company and
DTAG shall approve in writing a copy of the Offering Materials, including the
Offering Memorandum.
8. Delivery of and Payment for the Commercial Paper Notes. (a) On the
date of a proposed issuance of Commercial Paper Notes, the Company shall confer
with one or more of the Dealers as to the face or principal amount, maturities
and denominations thereof, the applicable interest rates or the discounts from
the face amounts, at which the Commercial Paper Notes are to be issued.
(b) On any date on which Commercial Paper Notes are to be sold
hereunder, each Dealer shall notify the Company as soon as practicable but not
later than 12:00 noon (New York City time) on such day of the amount of
Commercial Paper Notes placed by such Dealer by that time on such day.
(c) On any date on which Commercial Paper Notes are to be sold
hereunder, each Dealer shall notify the Depositary as soon as practicable, but
not later than 1:15 p.m. (New York City time) on such day of the amount of
Commercial Paper Notes placed by such Dealer by that time on such day.
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<PAGE> 12
9. Indemnification. DTAG agrees to assume liability for and to
indemnify, protect, save and hold harmless each Dealer, each individual,
corporation, partnership, trust, association or other entity (each, a "Person")
controlling each Dealer within the meaning of the Act or the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), or any Affiliate of any such
Person or a Dealer and their respective officers, directors, shareholders,
partners, servants, trustees, employees and agents (all of such indemnified
entities hereinafter the "Indemnitees") from and against any and all losses,
liabilities, claims, damages, penalties, causes of action, suits, costs and
expenses (including, without limitation, reasonable attorneys' fees and
expenses) or judgments of whatever kind and nature, imposed upon, incurred by or
asserted against the Indemnitees, which are (x) based upon or arising under the
securities laws of the United States of America or of any state and any
regulation, rule or interpretation thereunder or thereof to the extent arising
from the transactions contemplated hereby, (y) based upon the inaccuracy of any
representation made or reaffirmed by DTAG or the Company or the material breach
of any agreement or covenant of DTAG or the Company contained herein or (z)
based upon any untrue statement or alleged untrue statement of a material fact
in the Offering Materials or in any information (whether oral or written) or
documents or made available by the Company to offerees of the Commercial Paper
Notes or any of their representatives, or the omission or alleged omission from
the Offering Materials or from any information (whether oral or written) or
documents furnished or made available by the Company or DTAG to offerees of the
Commercial Paper Notes or any of their representatives of a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; provided, however, that the obligation of
DTAG under this Section 9 shall not extend to any losses, liability, claims,
damages, penalties, causes of action, suits, costs and expenses which have been
finally judicially determined to have resulted from the Indemnitee's gross
negligence or willful misconduct in respect of clauses (x) or (y) as the case
may be. In case any action, suit or proceeding (each, a "Proceeding") is brought
against any Indemnitee, such Indemnitee shall notify DTAG in writing as soon as
practicable of the commencement thereof, DTAG will be entitled to participate
therein, and, to the extent that DTAG may elect by written notice delivered to
the Indemnitee, to assume the defense thereof, with counsel reasonably
satisfactory to such Indemnitee; provided that if the defendants in any such
Proceeding include both the Indemnitee and DTAG and the Indemnitee shall have
concluded that there may be legal defenses available to it which are different
from or additional to those available to DTAG, the Indemnitee shall have the
right to select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such Proceeding on behalf of such Indemnitee. Upon
receipt of notice from DTAG to such Indemnitee of DTAG's election so to assume
the defense of such Proceeding and approval by the Indemnitee, DTAG will not be
liable to such Indemnitee for expenses incurred by the Indemnitee in connection
with the defense thereof (other than reasonable costs of investigation) unless
(i) the Indemnitee shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the next preceding
sentence (it being understood, however, that DTAG shall not be liable for the
expenses of more than one separate counsel representing the Indemnitees who are
parties to such Proceeding), (ii) DTAG shall not have employed counsel
reasonably satisfactory to the Indemnitee to represent the Indemnitee within a
reasonable time after notice of commencement of the Proceeding or (iii)
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<PAGE> 13
DTAG has authorized in writing the employment of counsel for the Indemnitee.
DTAG agrees that, without any Indemnitee's prior written consent, it will not
settle, compromise or consent to the entry of any judgment in any Proceeding in
respect of which indemnification may be sought under the indemnification
provision of this Agreement (whether or not such Indemnitee is an actual or
potential party to such Proceeding), unless such settlement, compromise or
consent includes an unconditional release of each Indemnitee from all liability
arising out of such Proceeding.
The Company agrees to assume liability for and to indemnify, protect,
save and hold harmless each of the Indemnitees from and against any and all
losses, liabilities, claims, damages, penalties, causes of action, suits, costs
and expenses (including, without limitation, reasonable attorneys' fees and
expenses) or judgments of whatever kind and nature, imposed upon, incurred by or
asserted against the Indemnitees, which are (x) based upon or arising under the
securities laws of the United States of America or of any state and any
regulation, rule or interpretation thereunder or thereof to the extent arising
from the transactions contemplated hereby, (y) based upon the inaccuracy of any
representation made or reaffirmed by the Company or the material breach of any
agreement or covenant of the Company contained herein or (z) based upon any
untrue statement or alleged untrue statement of a material fact in the Offering
Materials or in any information (whether oral or written) or documents furnished
or made available by the Company or DTAG to offerees of the Commercial Paper
Notes or any of their representatives, or the omission or alleged omission from
the Offering Materials or in any information (whether oral or written) or
documents furnished or made available by the Company to offerees of the
Commercial Paper Notes or any of their representatives of a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; provided, however, that the obligation of
the Company under this Section 9 shall not extend to any losses, liability,
claims, damages, penalties, causes of action, suits, costs and expenses which
have been finally judicially determined to have resulted from the Indemnitee's
gross negligence or willful misconduct in respect of clauses (x) or (y), as the
case may be. In case any Proceeding is brought against any Indemnitee, such
Indemnitee shall notify the Company in writing as soon as practicable of the
commencement thereof, the Company will be entitled to participate therein, and,
to the extent that the Company may elect by written notice delivered to the
Indemnitee, to assume the defense thereof, with counsel reasonably satisfactory
to such Indemnitee; provided that if the defendants in any such Proceeding
include both the Indemnitee and the Company and the Indemnitee shall have
concluded that there may be legal defenses available to it which are different
from or additional to those available to the Company, the Indemnitee shall have
the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such Proceeding on behalf of such
Indemnitee. Upon receipt of notice from the Company to such Indemnitee of the
Company's election so to assume the defense of such Proceeding and approval by
the Indemnitee, the Company will not be liable to such Indemnitee for expenses
incurred by the Indemnitee in connection with the defense thereof (other than
reasonable costs of investigation) unless (i) the Indemnitee shall have employed
separate counsel in connection with the assertion of legal defenses in
accordance with the proviso to the next preceding sentence (it being understood,
however, that the Company shall
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<PAGE> 14
not be liable for the expenses of more than one separate counsel representing
the Indemnitees who are parties to such Proceeding), (ii) the Company shall not
have employed counsel reasonably satisfactory to the Indemnitee to represent the
Indemnitee within a reasonable time after notice of commencement of the
Proceeding or (iii) the Company has authorized in writing the employment of
counsel for the Indemnitee. The Company agrees that, without any Indemnitee's
prior written consent, it will not settle, compromise or consent to the entry of
any judgment in any Proceeding in respect of which indemnification may be sought
under the indemnification provision of this Agreement (whether or not such
Indemnitee is an actual or potential party to such Proceeding), unless such
settlement, compromise or consent includes an unconditional release of each
Indemnitee from all liability arising out of such Proceeding.
The foregoing indemnities will also extend to any supplemental material
subsequently furnished in writing to any Dealer by DTAG or the Company for
distribution to purchasers or prospective purchasers during the term of this
Agreement.
In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section 9 is for
any reason held unavailable (otherwise than in accordance with the terms of this
Section 9), DTAG and the Company on the one hand, and any Indemnitee, on the
other hand, sought to be charged with any liability shall contribute to the
aggregate costs of satisfying such liability in the proportion of their
respective economic interests. For purposes of this Section 9, the "economic
interests" of DTAG and the Company shall be equal to the aggregate proceeds of
the Commercial Paper Notes issued in connection with this Agreement received by
the Company and the "economic interest" of any Indemnitee shall be equal to the
aggregate commissions and fees earned hereunder by the Dealer affiliated with
such Indemnitee.
The obligations of DTAG and the Company under this Section 9 shall
survive any termination of this Agreement, in whole or in part.
Notwithstanding anything to the contrary provided herein, neither DTAG
nor the Company will be liable in respect of any settlement of any pending or
threatened action if such settlement is effected without their written consent,
which consent shall not be withheld unless such settlement is unreasonable in
light of the claims or actions against, and defenses available to, the
Indemnitee.
10. Fees and Expenses. Each Dealer shall be entitled to compensation
and reimbursement of expenses in the amounts mutually agreed upon (orally or in
writing) between the Company and such Dealer from time to time including,
without limitation, all of such Dealer's reasonable out-of-pocket expenses,
related to the printing and distribution of any Offering Materials and any
distribution expenses and the reasonable fees and disbursements of its counsel
in connection with the review and negotiation of this Agreement and the other CP
Program Documents.
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<PAGE> 15
11. Notices. Unless otherwise indicated, all notices required under the
terms and provisions hereof shall be in writing, either delivered by hand, by
mail (postage prepaid), or by telex, telecopier or telegram, and any such notice
shall be effective when received at the address specified below.
If to the Company:
Dollar Thrifty Funding Corp.
5330 East 31st Street
Tulsa, OK 74135
Attention: Michael H. McMahon
Telephone No.: (918) 669-3914
Facsimile No.: (918) 669-2925
If to DTAG:
Dollar Thrifty Automotive Group, Inc.
5330 East 31st Street
Tulsa, OK 74135
Attention: Steven B. Hildebrand
Telephone No.: (918) 660-7700
Facsimile No.: (918) 669-2970
If to CSFB:
Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010-3629
Attention: Short and Medium-Term Finance Department
Telephone No.: (212) 325-7198
Facsimile No.: (212) 325-8183
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<PAGE> 16
If to Chase:
Chase Securities Inc.
270 Park Avenue, 9th Floor
New York, NY 10017
Attention: Money Market Division
Telephone No.: (212) 834-5070
Facsimile No.: (212) 834-6560
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 11 to the other party
hereto.
12. GOVERNING LAW. THIS AGREEMENT AND EACH COMMERCIAL PAPER NOTE SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.
13. Jurisdiction. Each of DTAG and the Company irrevocably agrees, for
the benefit of the holders of Commercial Paper Notes and each Dealer, that any
legal action, suit or proceeding against it arising out of this Agreement may be
brought in the United States District Court for the Southern District of New
York or in the courts of the State of New York and hereby irrevocably accepts
and submits to the non-exclusive jurisdiction of each of the aforesaid courts in
personam, generally and unconditionally with respect to any action, suit or
proceeding for itself and in respect of its properties, assets and revenues.
Each of DTAG and the Company designates CT Corporation System with offices at
1633 Broadway, New York, New York 10019 as its agent to receive, accept and
acknowledge on its behalf, service of any legal process, summons, notices and
documents which may be served in any such action, suit or proceeding brought in
the United States District Court for the Southern District of New York or in the
courts of the State of New York which may be made on such agent in accordance
with legal procedures prescribed for such courts. If for any reason such agent
shall cease to be available to act as such, DTAG and the Company agree to
designate a new agent in the City of New York satisfactory to each Dealer. Each
of DTAG and the Company further irrevocably agrees to the service of any legal
process, summons, notices and documents out of any of the aforesaid courts by
mailing copies thereof by registered or certified air mail, postage prepaid, to
it at its address designated pursuant to this Agreement. Nothing herein shall in
any way be deemed to limit the ability of the holder of any Commercial Paper
Notes or any Dealer, to serve any such legal process, summons, notices and
documents in any other manner, as may be permitted by applicable law or to
obtain jurisdiction over DTAG or the Company, or bring actions, suits or
proceedings against DTAG or the Company in such other jurisdictions, and in such
manner, as may be permitted by applicable law.
14. Choice of Forum. Each of DTAG and the Company agrees that any suit,
action or proceeding brought by DTAG or the Company against any Dealer in
connection with or arising
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<PAGE> 17
out of this Agreement, any agreement, instrument or document entered into in
connection with this Agreement or the offer and sale of Commercial Paper Notes
shall be brought solely in either the United States Federal courts located in
the Borough of Manhattan, the City of New York or in the courts of the State of
New York located in the Borough of Manhattan, the City of New York.
15. Amendment and Termination; Successors; Counterparts. (a) The terms
of this Agreement shall not be waived, altered, modified, amended or
supplemented in any manner whatsoever except by written instrument signed by all
parties hereto. The Company may terminate this Agreement as to all parties or as
to one or more Dealers, or a Dealer may terminate this Agreement as to itself
only upon thirty (30) days written notice to each other party hereto, provided
that such termination shall not affect the obligations of the parties hereunder
with respect to Commercial Paper Notes outstanding at the time of such
termination and actions or events occurring prior to such termination or with
respect to Section 9, 10, 19, 20 or 22 hereof.
(b) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and permitted assigns
hereunder.
(c) This Agreement may be executed in several counterparts, each of
which shall be deemed an original hereof.
16. Captions. The captions in this Agreement are for convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.
17. Effective Date. This Agreement shall be effective as of the date
and year first above written.
18. Severability of Provisions. Any provision of this Agreement which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability, without invalidating the remaining provisions hereof or
affecting the validity or enforceability, of such provision in any other
jurisdiction.
19. Bankruptcy. Each Dealer covenants and agrees that, prior to the
date which is one year and one day after the payment in full of all Commercial
Paper Notes Outstanding, it will not institute against, or join any other Person
in instituting against, the Company, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceeding
under the laws of the United States or any state of the United States. In the
event that any Dealer takes action in violation of this Section 19, the Company
agrees, for the benefit of the Holders of the Commercial Paper Notes, that it
shall file an answer with the bankruptcy court or otherwise properly contest the
filing of such a petition by the Dealer against the Company or the commencement
of such action and raise the defense that such Dealer has agreed in writing not
to take such action and should be estopped and precluded therefrom and such
other defenses, if any, as its counsel advises that it may assert; and such
Dealer acting in violation of this Section 19
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<PAGE> 18
shall be liable for and pay the costs and expenses of the Company incurred in
connection therewith. The provisions of this Section 19 shall survive the
termination of this Agreement.
20. Limited Recourse. Each Dealer agrees that the obligations of the
Company to such Dealer pursuant to Section 9 hereof shall be payable in the
order and priority set forth in Section 2.01 and 5.02(b), as applicable, of the
Collateral Agreement. Such obligations shall be due and payable by the Company
only to the extent that the Company's Assets are sufficient to pay such
obligations. No claims of any Dealer arising under or in connection with the
Collateral Agreement are intended to be impaired or waived by this Section 20.
The agreement of each Dealer under this Section 20 shall survive termination of
this Agreement.
21. Entire Agreement. This Agreement constitutes the entire agreement
among the parties hereto with respect to the matters covered hereby and
supersedes all prior agreements and understandings among the parties.
22. Assignment. This Agreement may not be assigned by DTAG or the
Company without the prior written consent of each of the Dealers or by any
Dealer without the prior written consent of each of DTAG and the Company, and
any such assignment without such consent shall be null and void. Notwithstanding
the immediately preceding sentence, this Agreement may be assigned or
transferred by any of the Dealers to any Affiliate of such Dealer upon at least
30 days prior written notice to each of the Company and DTAG; provided, that,
the Dealer shall remain liable and responsible for its duties and obligations
hereunder if such assignment or transfer is to an Affiliate of such Dealer.
23. Several Obligations. The Company acknowledges that the Dealers are
acting severally under this Agreement, and not jointly, and no Dealer shall have
any responsibility whatsoever for any purchase commitment or other undertaking
made by any other Dealer hereunder.
[Remainder of Page Intentionally Blank]
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<PAGE> 19
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
DOLLAR THRIFTY FUNDING CORP.
By:
-------------------------------------
Name:
Title:
DOLLAR THRIFTY AUTOMOTIVE
GROUP, INC.
By:
-------------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON
CORPORATION
By:
-------------------------------------
Name:
Title:
CHASE SECURITIES INC.
By:
-------------------------------------
Name:
Title:
<PAGE> 20
EXHIBIT A
, 199
Dollar Thrifty Automotive Group, Inc.
5330 East 31st Street
Tulsa, OK 74135
Attention: Steven B. Hildebrand
Dollar Thrifty Funding Corp.
5330 East 31st Street
Tulsa, OK 74135
Attention: Michael H. McMahon
Re: Confidentiality Agreement
Ladies and Gentlemen:
In order to induce Dollar Thrifty Funding Corp. (the "Company") and
Dollar Thrifty Automotive Group, Inc. ("DTAG") to provide us with certain
confidential and proprietary information concerning the Company and DTAG, and
the Company's assets, credit, liquidity and finances, the Company's business
relationships, various manufacturers and other persons, and any other
confidential and proprietary information provided by the Company or DTAG at any
time, in each case identified by DTAG or the Company as confidential and
proprietary (all of such information collectively referred to herein as the
"Confidential Information") for the sole purpose of and use by us in evaluating
whether to act or continue to act as a dealer in connection with the Company's
asset backed commercial paper program ("Transactions"), we hereby agree with the
Company and DTAG as follows:
1. Confidential Information shall not be disclosed by the
recipient without prior written permission of each of the
Company and DTAG except on a confidential basis to those
directors, officers, representatives and employees of the
recipient who are directly participating in, or engaged in the
evaluation of the proposed Transactions or persons in similar
positions with its affiliate who have a need to know. In
furtherance of such undertakings, the recipient agrees that it
will not duplicate or distribute to anyone, other than its
directors, officers, employees and authorized representatives
(including its accountants, attorneys and agents) who are
directly participating in the Transactions or persons in
similar positions with its affiliates who have a need to know,
any of the Confidential Information for any purpose, including
any competitive purpose, other than the Transactions.
<PAGE> 21
2. We shall cause our directors, officers, representatives, and
employees, to observe the terms of this Agreement to the same
extent that we are required to do so.
3. Notwithstanding any other provision in this Agreement, we and
our affiliates may disclose such information as may be
required (a) by court order, subpoena or similar process
issued by a court of competent jurisdiction or by a
governmental body, (b) in any report, statement or testimony
submitted to any municipal, state, federal or other regulatory
body having jurisdiction over such party or any of its
affiliates and required by such regulatory body to be so
disclosed, (c) in order to comply with any law, order,
regulation or ruling applicable to such party or any of its
affiliates, and we shall promptly inform the Company and DTAG
of our disclosure to any party pursuant to this paragraph 3
(other than disclosure of information to regulatory bodies in
the normal course of their regulatory oversight that is not
publicly available), or (d) in any court proceeding instituted
by or against Credit Suisse First Boston Corporation and its
affiliates (collectively, "CSFB") or Chase Securities Inc. or
its affiliates (collectively, "Chase") in furtherance of the
establishment of defenses available to CSFB or Chase, or (e)
to correct any untrue statements or errors in the Offering
Materials (as such term is defined in that certain Dealer
Agreement, dated March 4, 1998, among DTAG, the Company, as
issuer, and Credit Suisse First Boston Corporation and Chase
Securities Inc., each as a dealer thereto (the "Dealer
Agreement")).
4. The Confidential Information shall not include and this
Agreement shall not apply to any information which (i) is
described or included in the Offering Materials, (ii) was or
becomes generally available to the public, without violation
of any obligation of confidentiality by us or our
representatives, (iii) was or becomes available to us from a
third party, provided we do not believe such third party is
prohibited from transmitting the information to us, or (iv)
was or becomes available to us on a non-confidential basis
prior to its disclosure by the Company DTAG or their
representatives.
5. This Agreement shall be governed and construed in accordance
with the laws of the State of New York applicable to contracts
executed and to be performed therein, and shall be binding on
the parties' successors and assigns.
6. Unless such Confidential Information becomes public at an
earlier date, our obligations under this Agreement with
respect to an item of Confidential Information shall terminate
on the earliest of (a) one (1) year after the date of the
termination of the Dealer Agreement; or (b) upon the consent
of the Company or DTAG.
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<PAGE> 22
7. This Agreement may be executed in multiple counterparts, each
of which shall be deemed an original, but all such
counterparts shall together constitute one and the same
instrument.
[Remainder of Page Intentionally Blank]
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<PAGE> 23
Very truly yours,
CREDIT SUISSE FIRST BOSTON
CORPORATION
By:
-------------------------------------
Name:
Title:
CHASE SECURITIES INC.
By:
-------------------------------------
Name:
Title:
Agreed and Accepted:
DOLLAR THRIFTY AUTOMOTIVE
GROUP, INC.
By:
-------------------------------
Name:
Title:
DOLLAR THRIFTY FUNDING CORP.
By:
-------------------------------
Name:
Title:
-4-
