Exhibit 4.60
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RENTAL CAR FINANCE CORP.,
as Issuer
and
BANKERS TRUST COMPANY,
as Trustee and as Enhancement Agent
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AMENDED AND RESTATED SERIES 1998-1 SUPPLEMENT
dated as of February 26, 2002
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
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TABLE OF CONTENTS
Page
Article 1 DESIGNATION..........................................................1
Article 2 DEFINITIONS AND CONSTRUCTION.........................................2
Article 3 GRANT OF RIGHTS UNDER THE MASTER LEASE..............................36
Section 3.1 Grant of Security Interest...............................36
ARTICLE 4A INITIAL ISSUANCE AND INCREASES AND DECREASES OF SERIES 1998-1
INVESTED AMOUNT OF SERIES 1998-1 NOTES........................................37
Section 4A.1 Issuance in Definitive Form............................37
Section 4A.2 Procedure for Increasing the Series 1998-1 Invested
Amount...........................................................38
Section 4A.3 Decreases..............................................39
Article 4 ALLOCATION AND APPLICATION OF COLLECTIONS...........................40
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..............41
Section 4.7 Allocations with Respect to the Series 1998-1 Notes......42
Section 4.8 Monthly Payments.........................................48
Section 4.9 Payment of Note Interest.................................50
Section 4.10 Payment of Note Principal; Decreases....................50
Section 4.11 Retained Distribution Account...........................52
Section 4.12 Series 1998-1 Distribution Account......................52
Section 4.13 The Master Servicer's Failure to Instruct the Trustee
to Make a Deposit or Payment.....................................53
Section 4.14 Lease Payment Loss Draws on Series 1998-1 Letter
of Credit........................................................53
Section 4.15 Claim Under the Demand Note.............................54
Section 4.16 Series 1998-1 Letter of Credit Termination Demand.......55
Section 4.17 Conversion..............................................56
Section 4.18 The Series 1998-1 Cash Collateral Account...............57
Section 4.19 Appointment of Enhancement Agent........................59
Section 4.20 Exchange of Vehicles....................................59
Article 5 AMORTIZATION EVENTS.................................................60
Section 5.1 Series 1998-1 Amortization Events........................60
Section 5.2 Waiver of Past Events....................................61
Article 6 COVENANTS...........................................................62
Section 6.1 Minimum Subordinated Amount..............................62
Section 6.2 Minimum Series 1998-1 Letter of Credit Amount............62
Article 7 FORM OF SERIES 1998-1 NOTES.........................................62
Article 8 GENERAL.............................................................62
Section 8.1 Payment of Rating Agencies' Fees.........................62
Section 8.2 Exhibits.................................................62
Section 8.3 Ratification of Base Indenture...........................63
Section 8.4 Counterparts.............................................63
Section 8.5 Governing Law............................................63
Section 8.6 Amendments...............................................63
Schedule 1 - Maximum Manufacturer Percentages
Exhibit A - Form of Rental Car Asset Backed Variable Funding Note,
Series 1998-1
Exhibit B - [Reserved]
Exhibit C - Form of Demand Note
Exhibit D - Form of Notice of Series 1998-1 Lease Payment Losses
THIS AMENDED AND RESTATED SERIES 1998-1 SUPPLEMENT, dated as of
February 26, 2002 (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., 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, RCFC, the Trustee and the Enhancement Agent entered into
that certain Series 1998-1 Supplement, dated as of March 4, 1998, as heretofore
amended and supplemented (the "Original Supplement"), for the purpose of
authorizing the issuance of the Series 1998-1 Notes;
WHEREAS, Section 11.2 of the Base Indenture and Section 8.6 of the
Original Supplement provide, among other things, that the terms of the Original
Supplement may be modified from time to time in accordance with the terms of the
Base Indenture;
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 to amend and
restate the Original Supplement as follows:
ARTICLE 1
DESIGNATION
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(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 Group II Collection Account,
and shall be used (i) on and after the Series 1998-1 Closing Date, to finance
the acquisition by the Issuer, Thrifty or Dollar of Financed Vehicles or
Eligible Receivables or to refinance the same, (ii) on and after the Series
1998-1 Closing Date, to acquire Acquired Vehicles from certain Eligible
Manufacturers, Auctions or otherwise or to refinance the same, and (iii) 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". On December 15, 2000, RCFC and the Trustee also
entered into a supplement (the "Series 2000-1 Series Supplement") to the Base
Indenture pursuant to which RCFC issued a Segregated Series of Notes (the
"Series 2000-1 Notes") 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 and the Series 2000-1 Notes in the Group II Collateral
and any other Collateral and Master Collateral designated as security for the
Series 1998-1 Notes and the Series 2000-1 Notes under this Supplement, the
Series 2000-1 Series 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, the Series 2000-1
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
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(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 under the Master Lease, 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 embedded in a defined term within the Base Indenture, they shall
be deemed to refer to the corresponding concept described 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
"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) on such date pursuant to
any 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, and (B) a fraction, the numerator
of which is the Invested Amount of such Group II Series of Notes (or the
applicable class thereof) (which with respect to the Series 1998-1 Notes shall
be the Series 1998-1 Invested Amount) 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 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 Vehicles with respect to which the applicable Vehicle
Lease Expiration Date has not occurred, plus (ii) the Exchange Agreement Group
II Rights Value, plus (iii) 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 (iv) all amounts (other
than amounts specified in clause (iii) 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 (v) all accrued and unpaid Monthly
Base Rent and Monthly Supplemental Payments (other than amounts specified in
clauses (iii) and (iv) above) payable in respect of the Group II Vehicles, plus
(vi) cash and Permitted Investments on deposit in the Collection Account
constituting Group II Collateral (less any portion thereof allocated to the
Retained Interest), plus (vii) cash and Permitted Investments constituting Group
II Collateral and cash and Permitted Investments in the Master Collateral
Account constituting Group II Master Collateral.
3
"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, with respect to the Series 1998-1
Notes as of any date of determination, the amount, if any, by which the Required
Asset Amount exceeds the Aggregate Asset Amount, in each case, 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 the Rating Agencies,
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 Treasurer or an Assistant Treasurer, 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 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.
4
"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 (to the extent applicable), would be classified as capital
expenditures; and
(b) the aggregate amount of all Capitalized Lease Liabilities
incurred during such period; provided, however, that Capital Expenditures shall
not include any such amounts made or incurred in connection with Permitted
Business Acquisitions (as such term is defined in the Credit Agreement as in
effect on the date hereof and without giving effect to any amendments of such
term, unless otherwise agreed to by the liquidity lenders under the Liquidity
Agreement) (including Permitted Business Acquisitions that are Excepted Dollar
Acquisitions (as such term is defined in the Credit Agreement as in effect on
the date hereof and without giving effect to any amendments of such term, unless
otherwise agreed to by the liquidity lenders under the Liquidity Agreement)).
"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), fees, expenses and costs payable by RCFC in connection with an
Exchange Program 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.
"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).
5
"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.
"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.
"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, (iv) the Unused Exchange Proceeds and all
Substitute Group II Exchanged Vehicle Proceeds, (v) 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 (vi) 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 as Beneficiary thereunder); provided that the amount included in
clauses (i) through (vi) shall not include any Exchange Proceeds until such time
as RCFC is permitted to receive, pledge, borrow or otherwise obtain the benefits
of such Exchange Proceeds consistent with the limitations set forth in the "safe
harbor" provisions of Treasury Regulation ss. 1.1031(k)-1(g)(6).
"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 in DTAG's financial statements for the
Fiscal Year most recently completed opposite the captions (i) "receivables, net"
(excluding accounts receivable pledged to the Master Collateral Agent, or any
successor thereto in such capacity under Sections 2.1(a)(iii) and 2.1(b)(iii) of
the Master Collateral Agency Agreement), (ii) "prepaid expenses and other
assets," (iii) "income taxes receivable," and (iv) "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 in such financial statements opposite the
captions (i) "accounts payable" (excluding outstanding checks included in
accounts payable related to Vehicle financing ("float")), (ii) "accrued
liabilities," (iii) "income taxes payable," (iv) "public liability and property
damage," (v) "deferred income tax liabilities," and (vi) any like captions, at
such date; provided, however, that such sum shall only include amounts set forth
under the captions described in clauses (b)(ii), (iv), (v) and such captions
that are like the captions described in such clauses (b)(ii), (iv) and (v), in
each case, to the extent and solely to the extent that such amounts are payable
within the next 12 months of such date.
6
"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 Credit Suisse First
Boston, 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.
"Credit Agreement" means the Amended and Restated Credit Agreement,
dated as of August 3, 2000, among DTAG, Dollar and Thrifty, as borrowers, the
financial institutions from time to time party thereto, as lenders, Credit
Suisse First Boston, as administrative agent for the lenders, JPMorgan Chase
Bank (formerly known as The Chase Manhattan Bank), as syndication agent for the
lenders, and Credit Suisse First Boston and X.X. Xxxxxx Securities Inc.
(formerly known as 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.
"DaimlerChrysler" means DaimlerChrysler Motors Corporation, a Delaware
corporation.
"Decrease" means a Voluntary Decrease or a Mandatory Decrease, as
applicable.
"Defaulting Manufacturer" is defined in Section 18 of the Master
Lease.
7
"Demand Note" means that certain Demand Note, dated as of February 26,
2002, 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 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.
"Disposition Proceeds" shall have the meaning specified in the Base
Indenture and shall specifically include Substitute Group II Exchanged Vehicle
Proceeds and the proceeds from Group II Exchanged Vehicles.
"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
8
(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)
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 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,
DaimlerChrysler, Ford and Toyota, and with respect to Non-Program Vehicles,
DaimlerChrysler, General Motors, Ford, Nissan, Volkswagen, Toyota, Honda, Mazda,
Subaru, Suzuki, Mitsubishi, Isuzu, Kia and Hyundai, and, in each case, any other
Manufacturer that (a) has been approved by the Rating Agencies then rating the
Group II Series of Notes or, with respect to Program Vehicles only, 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 or Auction dealer under an 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 the Lien of the Master
Collateral Agent was noted on the Certificate of Title at the time of purchase,
and (c) the right to payments in respect of which has been assigned by the payee
thereof to the Master Collateral Agent for the benefit of the relevant
Beneficiaries; 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.
9
"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 Group II 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.
"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.
"Equity Offerings" means (i) the issuance by DTAG of its common stock,
par value $0.01 per share (the "Common Stock"), pursuant to a registered public
offering for net cash proceeds of a least $45,000,000, which proceeds were used
to provide collateral for the financing of Vehicles by DTAG and its
Subsidiaries, and (ii) the sale by DaimlerChrysler of 20,000,000 shares of the
Common Stock of DTAG owned by it pursuant to a registered public offering which,
following the consummation thereof, resulted in DTAG no longer being a
subsidiary of DaimlerChrysler.
"Escrow Account" means a segregated trust account established,
consistent with the requirements of the "safe harbor" provisions of Treasury
Regulations xx.xx. 1.1031(k)-1(g)(4) and 1.1031(k)-1(g)(6), in accordance with
the terms of the Exchange Agreement and into which are deposited the Exchange
Proceeds and other funds with which to purchase Group II Replacement Vehicles.
"Excess Cash Flow" means, for any Fiscal Year of DTAG, an amount equal
to the excess of (a) the sum, without duplication, of (i) Adjusted 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 aggregate amount paid by DTAG
and its Subsidiaries in cash during such Fiscal Year on account of Capital
Expenditures, other than Vehicle Debt (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), (iii) the
aggregate amount of all prepayments of any amounts outstanding under any
revolving credit facility or agreement (including the Credit 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, (iv) the
aggregate amount of all principal payments of Indebtedness, other than Vehicle
Debt, 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, including the Credit Agreement), (v) increases in Consolidated
Working Capital for such Fiscal Year, (vi) the amount of Investments, other than
Cash Equivalent Investments (as such term is defined in the Credit Agreement as
in effect on the date hereof and without giving effect to any amendments of such
term, unless otherwise agreed to by the liquidity lenders under the Liquidity
Agreement), 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, and (vii) the amount of Distributions made during such Fiscal Year
by DTAG in cash.
10
"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.
"Exchange Agreement" means the agreement dated as of July 23, 2001
between the Qualified Intermediary and RCFC pursuant to which, among other
things, the Qualified Intermediary holds the Exchange Proceeds in an Escrow
Account consistent with the requirements of the "safe harbor" provisions of
Treasury Regulations xx.xx. 1.1031(k)-1(g)(4) and 1.1031(k)-1(g)(6), as the same
agreement may be amended, supplemented, restated or otherwise modified from time
to time in accordance with its terms.
"Exchange Agreement Group II Rights Value" means the value of the
Group II Assignment of Exchange Agreement, which value shall be deemed to equal
as of any given time the amount of the Exchange Proceeds at such time.
"Exchange Proceeds" means as of any given time the sum of (i) the
money or other property from the sale of any Group II Exchanged Vehicle that is
held in an Escrow Account as of such time, (ii) any interest or other amounts
earned on the money or other property from the sale of any Group II Exchanged
Vehicles that is held in an Escrow Account as of such time; (iii) any amounts
receivable from Eligible Manufacturers and Eligible Vehicle Disposition Programs
or from Auctions, dealers or other Persons on account of Group II Exchanged
Vehicles; (iv) the money or other property from the sale of any Group II
Exchanged Vehicle held in the Master Collateral Account for the benefit of the
Qualified Intermediary as of such time and (v) any interest or other amounts
earned on the money or other property from the sale of any Group II Exchanged
Vehicle held in the Master Collateral Account for the benefit of the Qualified
Intermediary as of such time.
11
"Exchange Program" means a program under which RCFC will exchange
Group II Exchanged Vehicles for Group II Replacement Vehicles with the intent of
qualifying for deferral of gain and loss under Section 1031 of the Code.
"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 as 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.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number corresponding
to any calendar year (e.g., the "2002 Fiscal Year") refer to the Fiscal Year
ending on the December 31 occurring during such calendar year.
"Fitch" means Fitch, Inc.
"Ford" means Ford Motor Company, a Delaware corporation.
"Franchisee" means a franchisee of a Lessee.
"General Motors" means General Motors Corporation, a Delaware
corporation.
"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 Assignment of Exchange Agreement" means the Collateral
Assignment of the Exchange Agreement dated as of January 31, 2002 by and among
RCFC, the Lessees and the Master Collateral Agent pursuant to which each of RCFC
and each Lessee assigns (consistent with the limitations on RCFC's or such
Lessee's, as the case may be, right to receive, pledge, borrow or otherwise
obtain the benefits of the Exchange Proceeds contained in the "safe harbor"
provisions of Treasury Regulation ss. 1.1031(k)-1(g)(6)), all of its right,
title and interest in, to and under the Exchange Agreement as it relates to
Group II Vehicles to the Master Collateral Agent, as the same agreement may be
amended, supplemented, restated or otherwise modified from time to time in
accordance with its terms.
"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, Master Lease
Collateral or other Collateral related to Group II Vehicles, the Group II
Collection Account and all proceeds of the foregoing.
12
"Group II Collection Account" has the meaning specified in Section
4.6(a) hereof.
"Group II Exchanged Vehicle" means a Group II Vehicle that is
transferred to the Qualified Intermediary in accordance with the "safe harbor"
provisions of Treasury Regulation ss. 1.1031(k)-1(g)(4) and pursuant to the
procedures set forth in the Exchange Agreement, and thereby ceases to be a Group
II Vehicle.
"Group II Master Collateral" means all right, title and interest of
RCFC in Group II Vehicles and proceeds thereof, the other Master Collateral and
proceeds thereof in respect of Group II Vehicles, the Group II Assignment of
Exchange Agreement and any other collateral or proceeds that the Master
Collateral Agent has designated or segregated for the benefit of the Group II
Series of Notes; provided that the Group II Master Collateral shall not include
any Exchange Proceeds until such time as RCFC is permitted to receive, pledge,
borrow or otherwise obtain the benefits of such Exchange Proceeds consistent
with the limitations set forth in the "safe harbor" provisions of Treasury
Regulation ss. 1.1031(k)-1(g)(6).
"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 Noteholders" has the meaning specified in Section 3.1(a)
hereof.
"Group II Replacement Vehicle" means a Vehicle designated by the
Master Servicer as comprising Group II Collateral acquired in exchange for a
Group II Exchanged Vehicle in accordance with the terms of the Exchange
Agreement and under Section 1031 of the Code and the regulations promulgated
thereunder.
"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,
designated in the records of the Master Collateral Agent as a Group II Vehicle,
and pledged by RCFC under the Master Collateral Agency Agreement for the benefit
of the Trustee (on behalf of the Group II Noteholders).
"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.
13
"Hedging Obligations" means, with respect to any Person, all
liabilities of such Person under Hedging Agreements.
"Honda" means American Honda Motor Company, Inc., a California
corporation.
"Hyundai" means Hyundai Motor America, a California corporation.
"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:
(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.
14
"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
to
(b) Aggregate Interest Expense for the four consecutive Fiscal
Quarters ending on the last day of such Fiscal Quarter, net of interest income
for such four Fiscal Quarter period.
"Invested Amount" means, on any date of determination, 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 Series
Supplement that is analogous to the Series 1998-1 Invested Amount but for such
series.
"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; provided, however, that ownership or similar interests acquired by
such Person with funds constituting compensation to any employee of such Person,
in each case pursuant to an employee benefit plan being maintained by such
Person in accordance with all applicable laws, shall not constitute Investments
hereunder so long as the financial statements of such Person reflect such
Person's obligation to such employee (as a liability on such Person's balance
sheet or otherwise) with respect to such ownership or similar interest.
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.
"Isuzu" means American Isuzu Motors, Inc., a California corporation.
"Kia" means Kia Motors America, Inc., a California corporation.
"Late Return Payments" is defined in Section 13 of the Master Lease.
15
"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.
"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 by the Lessees or the Guarantor under the
Master Lease since the preceding Determination Date on account of past due
payments under the Master Lease, excluding any amounts drawn under the Series
1998-1 Letter of Credit.
"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 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, the Retained Interestholder 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 sufficient to cure the Series
1998-1 Enhancement Deficiency and (ii) the Rating Agencies shall have notified
RCFC, the Retained Interestholder 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, or (b) Section 5.1(b),(c) or (f) of this
Supplement.
16
"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 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, as the same may be amended, modified or
restated from time to time.
"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" means 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 leased under
the Master Lease: (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 such Acquired Vehicles by RCFC, the Master Collateral Agent or the Trustee
(including by deposit into the Collection Account or the Master Collateral
Account) plus (2) any Termination Payments that have accrued with respect to
such Acquired Vehicles, plus (iii) the amount of any Disposition Proceeds
received previously and constituting a voidable preference pursuant to the
Bankruptcy Code that were reclaimed, rescinded or otherwise returned during such
Related Month.
17
"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" means, with respect to any Related
Month, all payments required to be made by Manufacturers under such
Manufacturers' Vehicle Disposition Programs and incentive programs with respect
to Acquired Vehicles, which are not made within one hundred (100) days after the
related Disposition Dates of such Acquired Vehicles and remain unpaid at 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 (x) 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 or (y) related to payments by
Manufacturers that are not made within such one hundred (100) day period as a
result of the necessity to meet initial eligibility requirements of a
Manufacturer to receive Guaranteed Payments, Repurchase Payments and/or
Incentive Payments for a model year.
"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 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 is 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 Non-Program Vehicle is not so published in the NADA
Guide; 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 Non-Program Vehicle shall be
based upon such other reasonable methodology as determined by the Issuer.
18
"Market Value Adjustment Percentage" means, as of any 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 calculated 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 each
such Non-Program Vehicles calculated as of such date.
"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 3.1(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:
(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;
19
(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 Aggregate Principal Balances 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 (in each case, 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 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, 30%,
subject to the Manufacturer limitations set forth in Schedule 1 attached hereto.
"Mazda" means Mazda Motor of America, Inc., a California corporation.
20
"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, the Exchange Agreement Group II Rights Value 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, the Exchange
Agreement Group II Rights Value 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 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 II 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.
21
"Minimum Series 1998-1 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 (as such
term is defined in the Liquidity Agreement), the Minimum Series 1998-1 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.
"Mitsubishi" means Mitsubishi Motor Sales of America, Inc., a Delaware
corporation.
"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.
"Monthly Vehicle Statement" is defined in Section 24.4(f) of the
Master Lease.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Equity Proceeds" means with respect to the sale or issuance by
DTAG or any of its Subsidiaries to any Person (other than DTAG or any of its
Subsidiaries) of any Capital Stock, other than pursuant to the Equity Offerings,
or any warrants or options with respect to such Capital Stock or the exercise of
any such warrants or options, the excess of:
(a) the gross cash proceeds received by DTAG or such Subsidiary
from such sale, exercise or issuance (other than proceeds received with respect
to (i) employee incentive compensation plans (including incentive stock
options), (ii) employee stock purchase plans (including deferred stock purchase
plans) and (iii) direct purchase plans (other than the plans described in the
preceding clauses (i) and (ii)) to the extent such proceeds do not exceed
$1,000,000 in any Fiscal Year),
22
over
(b) all fees and expenses with respect to underwriting commissions
and legal, investment banking, brokerage and accounting and other professional
fees, sales commissions and disbursements actually incurred in connection with
such sale or issuance or exercise which have not (other than in the case of
reasonable out-of-pocket expenses) been paid to Affiliates of DTAG in connection
therewith.
"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.
"Net Worth" means, with respect to any Person at any date, on a
consolidated basis for such Person and its Subsidiaries, the excess of:
(a) the sum of capital stock (other than Redeemable Capital
Stock) taken at par value, capital surplus (other than in respect of Redeemable
Capital Stock) and retained earnings (or accumulated deficit) of such Person at
such date;
over
(b) treasury stock of such Person and, to the extent included in
the preceding clause (a), minority interests in Subsidiaries of such Person at
such date.
"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.
"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.
23
"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 or any successor agreement thereto), (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
Agreements 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,
over
(b) to the extent included in the preceding clause (a), gross
interest expense in respect of Vehicle Debt ("Vehicle Interest Expense").
"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.
"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 Group II Noteholders
shall notify the Trustee of objection thereto.
24
"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 are 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 obligations 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 Moody's of "P-1" and from Fitch of at least "F1+" (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 "AAA", from Moody's of at least
"Aaa" and from Fitch of at least "AAA" (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 contractual
commitment to invest therein, a rating from Standard & Poor's of at least
"A-1+", from Moody's of "P-1" and from Fitch of at least "F1+" (if rated by
Fitch); (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, rated in the highest
investment category granted by Moody's for investments in money market funds and
rated at least "AA" by Fitch (if rated by Fitch); (vii) Eurodollar time deposits
having a credit rating from Standard & Poor's of "A-1+", from Moody's of "P-1"
and from Fitch of at least "F1+" (if rated by Fitch); (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, of "P-1" by Moody's and of at least "F1+" from Fitch (if rated by Fitch)
and (ix) any other instruments or securities that satisfy the Rating Agency
Condition.
"Permitted Liens" is defined in Section 25.3 of the Master Lease.
"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.
25
"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.
"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 (i) has a long-term indebtedness rating from
Standard & Poor's of not lower than "AA", from Moody's of not lower than "Aa2"
and from Fitch of not lower than "AA" and a short-term indebtedness rating from
Standard & Poor's not lower than "A-1", from Moody's not lower than "P-1" and
from Fitch not lower than "F1", or (ii) has otherwise satisfied the Rating
Agency Condition.
"Qualified Intermediary" means such entity that (a) will be acting in
connection with an Exchange Program so as to permit RCFC to make use of the
"qualified intermediary" safe harbor of Treasury Regulation ss.
1.1031(k)-1(g)(4) and (b) is acceptable to the Rating Agencies.
"Rating Agencies" means, with respect to the Commercial Paper Notes,
Standard & Poor's, Moody's and Xxxxx.
"Rating Agency Condition" means, with respect to any action, that each
Rating Agency shall have notified DTFC 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 3.1(a)(i) of
this Supplement.
"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 (including any taxes) payable by, or obligations of, RCFC in
respect of the Series 1998-1 Notes 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 Group II Collection Account
or the Master Collateral Account in respect of Group II Master Collateral) from
any Person during such Related Month in respect of amounts that had previously
been treated as 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 Group II
Collection Account or the Master Collateral Account in respect of Group II
Master Collateral) resulting from the sale or other final disposition of
Acquired Vehicles that are Group II Vehicles (other than pursuant to Vehicle
Disposition Programs) plus any Termination Payments that have accrued with
respect to such Acquired Vehicles that are Group II Vehicles, over (y) the Net
Book Values of such Acquired Vehicles that are Group II Vehicles, calculated on
the dates of the respective sales or dispositions thereof.
26
"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 August 2, 2006, (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
Assignment Agreements, the Note Purchase Agreement, the Group II Assignment of
Exchange Agreement and the CP Program Documents (as such term is defined in the
Liquidity 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 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.
27
"Required Group II Noteholders" means Noteholders holding in excess of
50% of the Group II Aggregate Invested Amount (excluding, for the purposes of
making the foregoing calculation, any Notes held by DTAG or any Affiliate of
DTAG, except for any Affiliate that is a bankruptcy remote, special purpose
vehicle).
"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 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 Interest Amount.
"Retained Interest 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 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 and (ii) the
available subordinated amount percentages for all Group II Series of Notes that
provide for credit enhancement in the form of overcollateralization, including
all classes of such Group II Series of Notes, 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.
"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 Group
II 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.
28
"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 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(a) 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 Series 1998-1 Letter of Credit Amount. "Series 1998-1
Closing Date" means March 4, 1998.
"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 Deficiency Amount" has the meaning specified in
Section 4.8(a) of this Supplement.
29
"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 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 Payment Date
occurring in February 2007.
"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 Group II Collection Account which
represent Monthly Variable Rent, Monthly Finance Rent or the Availability
Payment accrued under any Lease related to Group II Vehicles with respect to the
Series 1998-1 Notes, plus the Series 1998-1 Invested Percentage of any amounts
earned on Permitted Investments in the Series 1998-1 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.
30
"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
allocated to the Series 1998-1 Noteholders 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 allocated to the Series 1998-1 Noteholders on or prior to such
date.
"Series 1998-1 Invested Percentage" means, on any date of
determination:
(i) when used with respect to Principal Collections during the
Series 1998-1 Revolving Period, and when used with respect to Losses, Lease
Payment Losses, Recoveries, Lease Payment Recoveries, cash on deposit in
the Master Collateral Account and the Collection Account and other amounts
at all times, 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 during 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, an amount equal to the Series 1998-1 Invested Percentage of Lease Payment
Losses as of such date.
31
"Series 1998-1 Lease Payment Recoveries" means, for any Determination
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 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 Supplement and the Master Lease, as amended from time to
time.
"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
of this Supplement, the amount on deposit in the Series 1998-1 Cash Collateral
Account on such date.
"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 Supplement and the
Master Lease.
"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 or the Series 1998-1 Termination Date and thereafter, 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 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 greater 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 Noteholders" means, collectively, the holders of the
Series 1998-1 Notes.
32
"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 (Reserve Adjusted) 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 Liquidity 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" has the meaning specified in the first paragraph
of Article 1 of this Supplement and 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 attached hereto.
"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, 10%.
"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.
"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 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 Payment Date occurring in February 2007.
"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, TCL Funding imited Partnership, a financing
partnership 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.
33
"Standard & Poor's" means Standard & Poor's, a division of The XxXxxx-
Xxxx Companies.
"Subaru" means Subaru of America, Inc., a New Jersey corporation.
"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.
"Substitute Group II Exchanged Vehicle Proceeds" means funds, in the
amount of the Net Book Value of Group II Exchanged Vehicles, transferred by
RCFC, at the direction of the Master Servicer, from (i) the Substitute Group II
Exchanged Vehicle Proceeds Amount, (ii) the Retained Distribution Account or
(iii) RCFC's capital and deposited into the Group II Collection Account to be
treated as Disposition Proceeds of such Group II Exchanged Vehicles.
"Substitute Group II Exchanged Vehicle Proceeds Amount" means, at any
time, funds, if any, set aside by RCFC in the Series 1998-1 Excess Funding
Account in respect of Group II Exchanged Vehicles for use as Substitute Group II
Exchanged Vehicle Proceeds.
"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 DTAG or such Subsidiary to another Person (including an
insurer of DTAG or such Subsidiary).
"Suzuki" means American Suzuki Motor Corporation, a California
corporation.
"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.
"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
34
"Unused Exchange Proceeds" means the Exchange Proceeds that are not
used to acquire Group II Replacement Vehicles and which are transferred from an
Escrow Account to RCFC in accordance with the terms of the Exchange Agreement.
"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 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 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 Order" is defined in Section 2.1 of the Master Lease.
"Vehicle Term" is defined in Section 3.1 of the Master Lease.
"VIN" is defined in Section 18 of the Master Lease.
"Volkswagen" means Volkswagen of America, Inc., a Michigan
corporation.
"Voluntary Decrease" is defined in Section 4A.3(b) of this Supplement.
35
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 holders of any of the Group II Series of Notes (the "Group II
Noteholders"), and hereby grants to the Trustee, for the benefit of the Group II
Noteholders, a first priority 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 following being referred to as the "Master Lease Collateral"):
(i) the rights of RCFC under the Master Lease and any other
agreements relating to the Group II Vehicles to which RCFC is a party other
than the Vehicle Disposition Programs and any Group II 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 to the RCFC Agreements or the obligations of
any party thereunder;
(ii) the Demand Note;
(iii) the Group II Assignment of Exchange Agreement;
(iv) any Unused Exchange Proceeds; and
(v) 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).
36
(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;
(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
(iii) 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 Group II Series Notes equally and ratably without
prejudice, priority (except as otherwise stated in this Supplement) or
distinction.
(d) Notwithstanding anything to the contrary in this Supplement or
the Related Documents, the Master Lease Collateral shall not include, and RCFC
does not hereby pledge, assign, convey, deliver, transfer or set over to the
Trustee or any of the Group II Noteholders, any security interest, lien or other
encumbrance in any Exchange Proceeds or any account or other arrangement for
holding or investing any Exchange Proceeds until such time as RCFC is permitted
to do so consistent with the limitations on the rights of a party to receive,
pledge, borrow, or otherwise obtain the benefits of money or other property set
forth in the "safe harbor" provisions of Treasury Regulation ss.
1.1031(k)-1(g)(6).
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 $800,000,000 (the
"Series 1998-1 Maximum Invested Amount"). The aggregate principal amount of the
Series 1998-1 Notes outstanding may not exceed such amounts.
37
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 Issuer to the Trustee 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
Group II 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. The Increase in the
Series 1998-1 Invested Amount shall be allocated pro rata among the Outstanding
Series 1998-1 Notes.
(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:
(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 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 Limited Liquidation Event of Default;
38
(iv) All conditions precedent (1) to the acquisition of additional
Group II 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; provided,
that an Opinion of Counsel to the effect that the Series 1998-1 Notes will
be treated as indebtedness of the Issuer for Federal income tax purposes
shall not be required;
(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,
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 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.
39
(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 (3) 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.
ARTICLE 4
ALLOCATION AND APPLICATION OF COLLECTIONS
-----------------------------------------
Any provisions of Article 4 of the Base Indenture and the Series
2000-1 Supplement 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 Interest 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.
40
(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.
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 has created an administrative sub-account within
the Collection Account for the benefit of holders of Notes from a Group II
Series of Notes (such sub-account, the "Group II Collection Account"). In
addition, the Trustee will create two administrative sub-accounts within the
Group II Collection Account. One such sub-account will be established for the
benefit of the Series 1998-1 Noteholders (such sub-account, the "Series 1998-1
Collection Account"). The second sub-account will be established for the benefit
of the Series 1998-1 Noteholders (such sub-account, the "Series 1998-1 Excess
Funding Account"). A portion of funds on deposit in the Series 1998-1 Excess
Funding Account may, from and after February 26, 2002 and from time to time
thereafter, be designated by RCFC as the Substitute Group II Exchanged Vehicle
Proceeds Amount. This designated amount shall be available only for the purposes
specified herein and shall not be otherwise generally available for withdrawal
to be used for the purposes of other funds in the Series 1998-1 Excess Funding
Account.
41
(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 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
Group II Collection Account and, concurrently with such initial deposit,
allocated by the Trustee 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:
(a) Allocations During the Series 1998-1 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
Lease Payment 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 Series 1998-1 Interest Amount and any other fees and
expenses of RCFC 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;
42
(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
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 Interest 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 4.15(b) in respect of unpaid Demand Note draws, which
withdrawals 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 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 Interest 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 Interest 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);
43
(iii) with respect to all Losses:
(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
Interest 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 Interest 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 and that have not been replenished pursuant to this
clause (iv); 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 fourth, any
remaining Recoveries not so allocated shall be released to the Issuer;
and
(2) allocate to the Retained Interest 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 Interest 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:
(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
44
(2) allocate to the Retained Interest 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 Interest Amount.
(b) INTENTIONALLY DELETED.
(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 and
Lease Payment 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 Investor
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, allocate an amount to the Series 1998-1 Excess
Funding Account;
(2) allocate to the Series 1998-1 Collection Account an
amount equal to the remaining Series 1998-1 Principal Allocation for
such day after making the allocations in (1) above, 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 4.15(b) in respect of
unpaid Demand Note draws, which withdrawals have not been replenished
under this clause (ii), increase the Series 1998-1 Available
Subordinated Amount, and pay any remaining Recoveries to the Group II
Collection Account for payment of principal to the Series 1998-1
Noteholders on the next succeeding Payment Date as required pursuant
to Section 4.10; and
45
(2) allocate to the Retained Interest 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 Interest Amount an amount
determined as set forth in Section 4.7(a)(iii)(2) above for such day,
which amount shall reduce the Retained Interest 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 that have not been replenished
pursuant to 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 Interest 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
(2) allocate to the Retained Interest Amount an amount
determined as set forth in Section 4.7(a)(v)(2) above for such day,
which amount shall reduce the Retained Interest 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 in
excess of the Substitute Group II Exchanged Vehicle Proceeds Amount, if
any, and that are not allocated to making 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, refinance 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 Interest 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, refinance or acquire Vehicles, to the extent
Eligible Vehicles have been requested by any of the Lessees under the
Master Lease, to pay the Net Book Value of Vehicles tendered for exchange
of like-kind property into the Group II Collection Account, or for
distribution to the Retained Interestholder (including any advances made
under the Demand Note or otherwise);
46
(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 Group
II 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 Group II Collection Account pursuant to Section 4.2(c) shall be
deemed to be deposited in the Group II 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) and 4.7(c)(i)(3) above shall not 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 any component of the Minimum 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 Group II 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;
47
(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 Group II Collection Account which are allocable to the
Retained Interest 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 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 4.7(a), to reduce the Series 1998-1 Invested Amount;
(vii) INTENTIONALLY DELETED.
(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)(ii) 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.
48
(a) Note Interest with respect to the Series 1998-1 Notes. On
each Reporting Date, the Master Servicer shall instruct the Trustee 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 0000-0 Xxxxxxxx Xxxxxx.
Xx such Reporting 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 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, after taking into account
any funds in the Series 1998-1 Excess Funding Account in excess of the
Substitute Group II Exchanged Vehicle Proceeds Amount, if any, 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 Payment 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 each of the Trustee and the Paying Agent
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
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.
49
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 and Section 4.8(a) of this
Supplement have been made, the Master Servicer shall instruct the Paying Agent
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 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 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 deposits required pursuant
to clause (i) of this Section 4.9 have 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 Paying Agent 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, (B) the amount on deposit in the Series 1998-1
Excess Funding Account in excess of the Substitute Group II Exchanged Vehicle
Proceeds Amount, if any, on such Payment Date, and (C) 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 Paying Agent shall, in
accordance with the Master Servicer's most recent Monthly Certificate, pay to
the Series 1998-1 Noteholders from the Series 1998-1 Distribution Account the
portion of the Series 1998-1 Interest 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.
50
(a) Series 1998-1 Notes.
(i) INTENTIONALLY DELETED.
(ii) Commencing on 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 amount allocated to the
Series 1998-1 Notes during the Related Month pursuant to Section
4.7(c)(i)(2); 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 to pay principal and interest in respect of
the related Series of Notes pursuant to 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 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 in excess of the Substitute Group II Exchanged Vehicle Proceeds
Amount, if any, 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 4.15 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 Series 1998-1
Termination Date, 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.
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(iv) On each Payment Date occurring on or after the date a
withdrawal is made pursuant to Section 4.10(a)(iii) of this Supplement, the
Paying Agent 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, pro rata, the amount deposited in the
Series 1998-1 Distribution Account for the payment of principal pursuant to
Section 4.10(a)(iii) of this Supplement.
(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 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, and the Paying Agent at the direction of the Trustee, in
each case for the benefit of the Series 1998-1 Noteholders.
Section 4.13 The Master 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 Group II 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 Group II 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 Lease Payment Loss Draws on Series 1998-1 Letter of
Credit.
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(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.
(b) So long as the Series 1998-1 Letter of Credit shall not have
been terminated, on any Payment Date 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 Payment Date, draw on the Series 1998-1 Letter of Credit 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) 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
Payment Date accompanied by a Certificate of Credit Demand. 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 and pursuant to the
terms of this Supplement.
(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. 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 Claim Under 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) 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 Account in the specified amount.
54
(b) In the event that on any Payment Date on which (x) a Demand
Notice has been transmitted to the issuer of the Demand Note on the related
Determination Date pursuant to Section 4.15(a) above and the Demand Note issuer
shall have failed to deposit into the Series 1998-1 Collection Account the
amount specified in such Demand Notice, on or prior to 10:00 a.m. (New York City
time) on such Payment Date, or (y) a Demand Notice for payment by the issuer of
the Demand Note could be transmitted to the issuer of the Demand Note of the
related Determination Date pursuant to Section 4.15(a) above, but has been
prevented from being transmitted or, if so transmitted, the issuer of the Demand
Note has been prevented from making any payment thereunder, in each case, as a
result of the operation of any bankruptcy or insolvency law, then 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
(i) 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) on such Payment Date, in the case of
clause (x) above or (ii) the amount of the stayed demand for payment in the case
of clause (y) above, in each case, accompanied by a Certificate of Credit
Demand. 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 Group II 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
55
(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 short-term debt ratings with respect to such
substitute credit enhancement, if applicable, are less than "A-1" or
the equivalent from Standard & Poor's, "P-1" or the equivalent from
Xxxxx'x and, if rated by Fitch, "F1" or the equivalent by Fitch, be
approved by the Required Group II 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
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" in
the case of Standard & Poor's, "P-1" in the case of Xxxxx'x or, if rated by
Fitch, "F1" in the case of Fitch. 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, unless the Master
Servicer shall have obtained a new letter of credit substantially in the form of
the Series 1998-1 Letter of Credit and provided by an entity with short-term
debt ratings of at least "A-1" in the case of Standard & Poor's, "P-1" in the
case of Xxxxx'x and if rated by Fitch, "F1" in the case of Fitch, 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 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 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.
56
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 4.16, 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, 4.15 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 the Series 1998-1 Letter of Credit pursuant
to Section 4.14, 4.15 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, 4.15 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.
57
(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 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) 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 Master 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.
(d) 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 Master 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.
58
(e) 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 Master
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 and shall pay from such amounts to the Series
1998-1 Letter of Credit Provider an amount equal to the amount of unreimbursed
draws on the Series 1998-1 Letter of Credit.
Section 4.19 Appointment of Enhancement Agent. Bankers TrustCompany
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 substantially
the form attached as Exhibit D to the CP Enhancement Letter of Credit
Application and Agreement. The Enhancement Agent further agrees that, in cases
where it shall be obligated to deliver a Notice of Increase of Series 1998-1
Letter of Credit Amount in the form of and pursuant to the terms provided in
Annex F to that certain Irrevocable Letter of Credit dated March 4, 1998 (No.
TS-06000979), it shall concurrently deliver its acknowledgement and acceptance
of such notice to each of the Collateral Agent and the Depositary.
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.
Section 4.20 Exchange of Vehicles. On any date on which RCFC
determines to tender a Group II Vehicle to the Qualified Intermediary as a Group
II Exchanged Vehicle, RCFC shall either:
59
(i) designate and direct the Trustee to transfer amounts in
respect of the Substitute Group II Exchanged Vehicle Proceeds equal to the
Net Book Value as of such date of the Group II Exchanged Vehicle to the
Series 1998-1 Collection Account and treat such amounts as Disposition
Proceeds of such Group II Exchanged Vehicle;
(ii) upon identifying a Group II Vehicle as a Group II Exchanged
Vehicle designate on such date an increase in Exchange Agreement Group II
Rights Value equal to the Exchange Proceeds of such Group II Exchanged
Vehicle and to the extent such increase in Exchange Agreement Group II
Rights Value is more or less than the Net Book Value of such Group II
Exchanged Vehicle, treat the difference as a Recovery or a Loss, as
applicable, hereunder; or
(iii) upon identifying a Group II Vehicle as a Group II Exchanged
Vehicle, substitute one or more Group II Replacement Vehicles having an
aggregate Net Book Value at least equal to the Exchange Proceeds of the
Group II Exchanged Vehicle to substitute for such Group II Exchanged
Vehicle as Group II Collateral and Group II Vehicles for purposes of the
Related Documents and to the extent such Exchange Proceeds are more or less
than the Net Book Value of such Group II Exchanged Vehicle, treat the
difference as a Recovery or a Loss, as applicable, hereunder.
RCFC shall provide written instruction to the Trustee and Master
Collateral Agent upon tender of a Group II Exchanged Vehicle to a Qualified
Intermediary with respect to the designations, substitutions and transfers set
forth in this Section.
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 Cash Collateral Account or 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;
60
(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 Sections 4.16 or 4.18 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);
(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 r 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
Liquidity Agreement.
In the case of any event described in clause (a) above, an
Amortization Event will be deemed to have occurred with respect to the Series
1998-1 Notes, after the grace period described therein, immediately without
notice or other action on the part of the Trustee or the Series 1998-1
Noteholders. In the case of any of the events described in clauses (b) through
(h) 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.
61
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.
Section 6.2 Minimum Series 1998-1 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 Series 1998-1 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 DTFC 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
62
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, 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 Group II 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 Group II 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]
63
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: __________________________________________
Xxxxxx X. Xxxx
Vice President and Treasurer
BANKERS TRUST COMPANY, as Trustee and
Enhancement Agent
By: __________________________________________
Name:
Title:
Accepted and Acknowledged by:
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.,
as Master Servicer
By: _____________________________
Xxxxxxx X. XxXxxxx
Assistant Treasurer
THRIFTY RENT-A-CAR SYSTEM, INC., as Servicer
By: _____________________________
Xxxxxx X. Xxxx
Treasurer
DOLLAR RENT A CAR SYSTEMS, INC., as Servicer
By: _____________________________
Xxxxxxx X. XxXxxxx
Treasurer
CREDIT SUISSE FIRST BOSTON, as the Enhancement Provider
By: _____________________________
Name:
Title:
By: _____________________________
Name:
Title:
64
DOLLAR THRIFTY FUNDING CORP., as the Series 1998-1 Noteholder
By: _____________________________
Xxxxxx X. Xxxx
Vice President and Treasurer
65
SCHEDULE 1
Schedule of Maximum Manufacturer Percentages of Group II Vehicles
-----------------------------------------------------------------
Maximum Program Maximum Non-Program
Eligible Manufacturer Percentage* Percentage*
----------------------- ----------------- ---------------------
DaimlerChrysler 100% 30%
Ford 100% 30%
Toyota 100% 30%
General Motors 0% 30%
Honda 0% 30%
Nissan 0% 30%
Volkswagen 0% 30%
Mazda 0% Up to 25%
Subaru 0% Up to 15% (1) (2)
Suzuki 0% Up to 15% (1) (2)
Mitsubishi 0% Up to 15% (1) (2)
Isuzu 0% Up to 15% (1) (2)
Kia 0% Up to 5% (2) (3)
Hyundai 0% Up to 3% (2) (3)
-------------------
(1) The combined percentage of Group II Vehicles which are Non-Program Vehicles
manufactured by Subaru, Suzuki, Mitsubishi or Isuzu shall not exceed 15% in
the aggregate.
(2) The combined percentage of Group II Vehicles which are Non-Program Vehicles
manufactured by Subaru, Suzuki, Mitsubishi, Isuzu, Kia or Hyundai shall not
exceed 20% in the aggregate.
(3) The combined percentage of Group II Vehicles which are Non-Program Vehicles
manufactured by Kia and Hyundai shall not exceed 7% in the aggregate.
* As a percentage of the Group II Collateral.
EXHIBIT A
Form of Series 1998-1 Note
--------------------------
RENTAL CAR ASSET BACKED VARIABLE FUNDING NOTE, SERIES 1998-1
REGISTERED
No. R-1
SEE REVERSE FOR CERTAIN CONDITIONS
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES OR "BLUE SKY" LAWS.
THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES FOR THE BENEFIT OF RENTAL CAR
FINANCE CORP., AN OKLAHOMA CORPORATION (THE "COMPANY"), THAT THIS NOTE IS BEING
ACQUIRED FOR ITS OWN ACCOUNT AND NOT WITH A VIEW TO DISTRIBUTION. THIS NOTE IS
NOT PERMITTED TO BE TRANSFERRED, ASSIGNED, EXCHANGED OR OTHERWISE PLEDGED OR
CONVEYED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE INDENTURE REFERRED TO
HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AND SUBJECT TO
INCREASES AND DECREASES AS SET FORTH HEREIN AND IN THE INDENTURE. ACCORDINGLY,
THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
RENTAL CAR FINANCE CORP.
RENTAL CAR ASSET BACKED VARIABLE FUNDING NOTE, SERIES 1998-1
RENTAL CAR FINANCE CORP., an Oklahoma corporation (herein referred to
as the "Company"), for value received, hereby promises to pay to Dollar Thrifty
Funding Corp., an Oklahoma corporation (the "Noteholder"), or its registered
assigns, the aggregate unpaid principal amount shown on the schedule attached
hereto (and any continuation thereof), which amount shall be payable in the
amounts and at the times set forth in the Indenture (as defined on the reverse
side of this Note), provided, however, that the entire unpaid principal amount
of this Note shall be due on the Series 1998-1 Termination Date (unless extended
in writing by the parties to the Indenture and the Noteholder). The Company will
pay interest on this Note at the Series 1998-1 Note Rate. Such interest shall be
payable on each Payment Date or such other date as may be specified in the
Supplement until the principal of this Note is paid or made available for
payment, to the extent funds will be available from Collections processed from
but not including the preceding Payment Date through each such Payment Date or
such other date, as applicable, in respect of the sum of (i) the Daily Interest
Amounts for each day in the related Series 1998-1 Interest Period, plus (ii) 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 (iii) any
Carrying Charges due to the Series 1998-1 Noteholders and unpaid as of such
Payment Date. The principal amount of this Note shall be subject to Increases
and Decreases on any Business Day during the Series 1998-1 Revolving Period, and
accordingly, such principal amount is subject to prepayment at any time.
Notwithstanding the foregoing, prior to the Series 1998-1 Termination Date and
unless an Amortization Event shall have occurred, only interest payments on the
outstanding Principal Amount of this Note are required to be made to the holder
hereof. Beginning on the first Payment Date following the occurrence of an
Amortization Event, subject to Decreases on any Business Day, the principal of
this Note shall be paid in installments on each subsequent Payment Date to the
extent of funds available for payment therefor pursuant to the Indenture. Such
principal of and interest on this Note shall be paid in the manner specified on
the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Company
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note. This
Note does not represent an interest in, or an obligation of, the Master Servicer
or any affiliate of the Master Servicer other than the Company.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note. Although a summary of certain provisions of the
Indenture are set forth below and on the reverse hereof and made a part hereof,
this Note does not purport to summarize the Indenture and reference is made to
the Indenture for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Master Servicer and the Trustee. A copy of the Indenture may
be requested from the Trustee by writing to the Trustee at: Bankers Trust
Company, 0 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust
and Agency Group. To the extent not defined herein, the capitalized terms used
herein have the meanings ascribed to them in the Indenture.
A-2
Unless the certificate of authentication hereon has been executed by
the Trustee whose name appears below by manual signature, this Note shall not be
entitled to any benefit under the Indenture referred to on the reverse hereof,
or be valid or obligatory for any purpose.
A-3
IN WITNESS WHEREOF, the Company has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer.
Date: March 4, 1998
RENTAL CAR FINANCE CORP.
By:____________________________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes of a Series issued under the within-mentioned
Indenture.
BANKERS TRUST COMPANY,
as Trustee
By:____________________________________________
Authorized Signature
REVERSE OF SERIES 1998-1 NOTE
-----------------------------
This Note is one of a duly authorized issue of Notes of the Company,
designated as its Rental Car Asset Backed Variable Funding Notes, Series 1998-1
(herein called the "Series 1998-1 Notes"), all issued under (i) a Base
Indenture, dated as of December 13, 1995 (as amended by Amendment to Base
Indenture, dated as of December 23, 1997, and as the same may be further
amended, supplemented, restated or otherwise modified from time to time in
accordance with the terms thereof, the "Base Indenture"), between the Company,
as issuer, and Bankers Trust Company, a New York banking corporation ("Bankers
Trust Company"), as trustee (in such capacity, the "Trustee"), and (ii) a 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 thereof, the "Series 1998-1 Supplement"), between the Company, as
issuer, and Bankers Trust Company, as the Trustee and enhancement agent (in such
additional capacity, the "Enhancement Agent"). The Base Indenture and the Series
1998-1 Supplement are referred to herein collectively as the "Indenture". The
Series 1998-1 Notes are subject to all terms of the Indenture. All terms used in
this Series 1998-1 Note that are defined in the Indenture, as amended,
supplemented, restated or otherwise modified from time to time in accordance
with the terms thereof, shall have the meanings assigned to them in or pursuant
to the Indenture, as so amended, supplemented, restated or otherwise modified.
The 1998-1 Notes are and will be equally and ratably secured by the
Collateral pledged as security therefor as provided in the Indenture and the
Series 1998-1 Supplement.
"Payment Date" means the 25th day of each calendar month, or, if any
such date is not a Business Day, the next succeeding Business Day, commencing
April 25, 1998.
As described above, the entire unpaid principal amount of this Series
1998-1 Note shall be due and payable on the Series 1998-1 Termination Date.
Notwithstanding the foregoing, if an Amortization Event, Liquidation Event of
Default or Limited Liquidation Event of Default shall have occurred and be
continuing then, in certain circumstances, principal on the Series 1998-1 Notes
may be paid earlier, as described in the Indenture. All principal payments on
the Series 1998-1 Notes shall be made pro rata to the Series 1998-1 Noteholders
entitled thereto.
Payments of interest on this Series 1998-1 Note are due and payable on
each Payment Date or such other date as may be specified in the Supplement,
together with the installment of principal then due, if any, and any payments of
principal made on any Business Day in respect of any Decreases, to the extent
not in full payment of this Series 1998-1 Note, shall be made by wire transfer
to the Holder of record of this Series 1998-1 Note (or one or more predecessor
Series 1998-1 Notes) on the Note Register as of the close of business on each
Record Date. Any reduction in the principal amount of this Series 1998-1 Note
(or any one or more predecessor Series 1998-1 Notes) effected by any payments
made on any Payment Date shall be binding upon all future Holders of this Series
1998-1 Note and of any Series 1998-1 Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not noted
thereon. If funds are expected to be available, as provided in the Indenture,
for payment in full of the then remaining unpaid principal amount of this Series
1998-1 Note on a Payment Date or on any Business Day, then the Trustee, in the
name of and on behalf of the Company, will notify the Person who was the
registered Holder hereof as of the Record Date preceding such Payment Date by
notice mailed within five days of such Payment Date and the amount then due and
payable shall be payable only upon presentation and surrender of this Series
1998-1 Note at the Corporate Trust Office.
A-5
The Company shall pay interest on overdue installments of interest at
the Series 1998-1 Note Rate to the extent lawful.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Series 1998-1 Note may be registered on the
Note Register upon surrender of this Series 1998-1 Note for registration of
transfer at the office or agency designated by the Company pursuant to the
Indenture, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Company and the Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, with such signature
guaranteed by a commercial bank or trust company located, or having a
correspondent located, in the City of New York or the city in which the
Corporate Trust Office is located, or a member firm of a national securities
exchange, and such other documents as the Registrar may reasonably require, and
thereupon one or more new Series 1998-1 Notes of authorized denominations and in
the same aggregate principal amount will be issued to the designated transferee
or transferees. No service charge will be charged for any registration of
transfer or exchange of this Series 1998-1 Note, but the transferor may be
required to pay a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with any such registration of transfer or
exchange.
Each Series 1998-1 Noteholder, by acceptance of a Series 1998-1 Note,
covenants and agrees that no recourse may be taken, directly or indirectly, with
respect to the obligations of the Trustee or the Company on the Series 1998-1
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Trustee or the Company in its individual
capacity, (ii) any owner of a beneficial interest in the Company or (iii) any
partner, owner, beneficiary, agent, officer, director or employee of the Trustee
or the Company in its individual capacity, any holder of a beneficial interest
in the Company or the Trustee or of any successor or assign of the Trustee or
the Company in its individual capacity, except (a) as any such Person may have
expressly agreed and (b) any such partner, owner or beneficiary shall be fully
liable, to the extent provided by applicable law, for any unpaid consideration
for stock, unpaid capital contribution or failure to pay any installment or call
owing to such entity; provided, however, that nothing contained herein shall be
taken to prevent recourse to, and enforcement against, the assets of the Company
for any and all liabilities, obligations and undertakings contained in the
Indenture or in this Series 1998-1 Note, subject to Section 12.16 of the Base
Indenture.
Each Series 1998-1 Noteholder, by acceptance of a Series 1998-1 Note,
covenants and agrees that by accepting the benefits of the Indenture that such
Series 1998-1 Noteholder will not for a period of one year and one day following
the later of (i) payment in full of all Series 1998-1 Notes and (ii) the payment
in full of all Commercial Paper Notes Outstanding, institute against the
Company, or join in any institution against the Company of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
United States Federal or state bankruptcy or similar law in connection with any
obligations relating to the Series 1998-1 Notes, the Indenture or the Related
Documents.
A-6
Prior to the due presentment for registration of transfer of this
Series 1998-1 Note, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name this Series 1998-1 Note (as of the
day of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Series 1998-1 Note be overdue, and neither the Company, the Trustee nor any
such agent shall be affected by notice to the contrary.
It is the intent of the Company and each Series 1998-1 Noteholder
that, for federal, state and local income and franchise tax purposes only, the
Series 1998-1 Notes will evidence indebtedness of the Company secured by the
Collateral. Each Series 1998-1 Noteholder, by the acceptance of this Series
1998-1 Note, agrees to treat this Series 1998-1 Note for federal, state and
local income and franchise tax purposes as indebtedness of the Company.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Series 1998-1 Notes under the
Indenture at any time by the Company with the consent of the Holders of Series
1998-1 Notes representing more than 50% in principal amount of the Outstanding
Series 1998-1 Notes which are affected by such amendment or modification subject
to certain exceptions set forth in the Indenture. The Indenture also contains
provisions permitting the Holders of Series 1998-1 Notes representing specified
percentages of the Outstanding Series 1998-1 Notes, on behalf of the Holders of
all the Series 1998-1 Notes, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Series
1998-1 Note (or any one of more predecessor Series 1998-1 Notes) shall be
conclusive and binding upon such Holder and upon all future Holders of this
Series 1998-1 Note and of any Series 1998-1 Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent or waiver is made upon this Series 1998-1 Note. The Indenture
also permits the Trustee to amend or waive certain terms and conditions set
forth in the Indenture without the consent of Holders of the Series 1998-1 Notes
issued thereunder.
The term "Company" as used in this Series 1998-1 Note includes any
successor to the Company under the Indenture.
The Series 1998-1 Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations set
forth therein.
This Series 1998-1 Note and the Indenture shall be construed in
accordance with the law of the State of New York, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder and thereunder shall be determined in accordance with such
law.
A-7
No reference herein to the Indenture and no provision of this Series
1998-1 Note or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
interest on this Series 1998-1 Note at the times, place, and rate, and in the
coin or currency herein prescribed, subject to any duty of the Company to deduct
or withhold any amounts as required by law, including any applicable U.S.
withholding taxes.
A-8
INCREASES AND DECREASES
======== ============= ============ ============ ========= ============= =================== ==========
Unpaid Series Interest Notation
Principal 1998-1 Note Period Made
Date Amount Increase Decrease Total Rate (if applicable) by
======== ============= ============ ============ ========= ============= =================== ==========
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A-9
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee
__________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto___________________________________________ (name and address of
assignee)
the within Series 1998-1 Note and all rights thereunder, and hereby irrevocably
constitutes and appoints , attorney, to transfer said Series 1998-1 Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated:___________________ __________________________________1/
Signature Guaranteed:
_______________________________________________
_________________________
__________________________________
1/ NOTE: The signature to this assignment must correspond with the name of the
registered owner as it apprears on the fac of the within Series 1998-1 Note in
every particular, without alteration, enlargement or any change whatsoever.
A-10
EXHIBIT B
[Reserved]
EXHIBIT C
Form of Demand Note
-------------------
New York, New York
[------------------]
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, as amended by the Amendment to
Base Indenture, dated as of December 23, 1997, between RCFC and Bankers Trust,
as Trustee (the "Base Indenture") as supplemented by the Series 1998-1
Supplement, dated as of March 4, 1998 (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. DTAG shall repay in full the unpaid principal
amount of the Demand Note upon the Demand Date hereof. Prior thereto, 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
(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 of Recoveries not allocated pursuant to Sections
4.7(a)(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, xxx for, or otherwise take, accept or receive, any amounts in respect of
this Demand Note.
(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.
C-2
(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 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).
C-3
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 DEMAND 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:____________________________________________
Xxxxxx X. Xxxx
Treasurer
Accepted and Agreed:
RENTAL CAR FINANCE CORP.
By:_______________________________
Xxxxxxx X. XxXxxxx
Assistant Treasurer
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Schedule A
PAYMENT GRID
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Principal Amount of Amount of Demand Outstanding Notation
Date Amount Principal Payment Note Advance Principal Balance Made by
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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
0 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This Series 1998-1 Lease Payment Losses Notice is delivered to you
pursuant to Section 4.14 of the Amended and Restated Series 1998-1 Supplement
dated as of February 26, 2002 to the Base Indenture dated as of December 13,
1995, as amended by the Amendment to Base Indenture dated as of December 23,
1997 (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 _________, 20__ there exists Series 1998-1 Lease Payment Losses
in the amount of $__________.
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.
By:____________________________________________
Name:
Title:
