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EXHIBIT 4.2
EXECUTION COPY
SERIES 1999-1 SUPPLEMENT
dated as of February 26, 1999
to the
BASE INDENTURE,
dated as of April 30, 1996
between
NATIONAL CAR RENTAL FINANCING LIMITED PARTNERSHIP,
as the Issuer
THE BANK OF NEW YORK,
as the Trustee
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SERIES 1999-1 SUPPLEMENT, dated as of February 26, 1999 (as the same
may be amended, supplemented, restated or otherwise modified from time to time
in accordance with the terms hereof, this "Supplement"), between NATIONAL CAR
RENTAL FINANCING LIMITED PARTNERSHIP, a special purpose Delaware limited
partnership ("NFLP"), and THE BANK OF NEW YORK, a New York banking corporation,
as trustee (together with its successors in trust under the Base Indenture
referred to below as provided thereunder, the "Trustee"), to the Base Indenture,
dated as of April 30, 1996, between NFLP and the Trustee (as amended by the
Supplement and Amendment to Base Indenture dated as of December 20, 1996,
between NFLP and the Trustee, and as the same may be further amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof and in effect, exclusive of Supplements creating a new Series of
Notes, the "Base Indenture").
PRELIMINARY STATEMENT
WHEREAS, Sections 2.2 and 12.1 of the Base Indenture provide, among
other things, that NFLP and the Trustee may at any time and from time to time
enter into a supplement to the Base Indenture for the purpose of authorizing the
issuance of one or more Series of Notes.
WHEREAS, all conditions precedent as set forth in such Sections with
respect to entering into a supplement to the Base Indenture have been satisfied;
provided that, as permitted to be specified in a Supplement, no Opinion of
Counsel shall be delivered pursuant to Section 2.2(f)(i)(x) or Section
2.2(f)(ix)(B), which Sections are hereby specified as not applicable to the
Series 1999-1 Notes.
NOW, THEREFORE, in consideration of the premises and of the agreements
herein contained, and for due and adequate consideration, which the parties
hereto hereby acknowledge, the parties hereto hereby agree as follows:
ARTICLE 1
DESIGNATION
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 Variable Funding Rental Car Asset Backed Notes, Series 1999-1.
The proceeds from the sale of the Series 1999-1 Notes (as defined
herein) and the proceeds from any Increase (as defined herein) shall be
deposited in the Series 1999-1 Collection
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Account and shall be available to NFLP and used to (i) acquire, finance or
refinance Eligible Vehicles for leasing under the Group I Lease, (ii) finance or
refinance Eligible Receivables and (iii) make payments in reduction of the
Invested Amount of other Group I Notes.
As described herein, the Series 1999-1 Notes will share an undivided
interest in certain collateral which may also secure other Group I Notes, if
any. The Series 1999-1 Notes will not share in the collateral securing the
Series 1996-1 Notes or the Series 1997-2 Notes, the Series 1997-3 Notes or the
Series 1997-4 Notes, and none of the Series 1996-1 Notes, the Series 1997-2
Notes, the Series 1997-3 Notes or the Series 1997-4 Notes or any other Series of
Notes that are not Group I Notes will share in the collateral securing the
Series 1999-1 Notes. 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 Series of
Group I Notes and not any other Series of Notes.
ARTICLE 2
DEFINITIONS
Section 2.1 Definitions.
(a) Capitalized terms used but not defined herein (including the
preamble and the recitals hereto) shall have the meanings assigned to such terms
in (a) the Definitions List attached hereto as Annex A, as such Definitions List
may be amended, supplemented, restated or otherwise modified from time to time
in accordance with the terms hereof, and (b) the Definitions List attached as
Schedule 1 to the Base Indenture, as such Definitions List may be further
amended, supplemented, restated or otherwise modified from time to time in
accordance with the terms of the Base Indenture, provided that to the extent, if
any, that any capitalized term used but not defined herein has a meaning
assigned to such term in both of the lists referred to above, then, for purposes
of this Supplement and the Base Indenture as it relates to the Series 1999-1
Notes, the meaning assigned to such term in the Definitions List attached hereto
as Annex A as in effect shall apply.
(b) For purposes of the Series 1999-1 Notes, any reference in the Base
Indenture to (i) the term "Required Asset Amount" shall be deemed to be a
reference to the Group I Required Asset Amount, (ii) the term "Collateral" shall
be deemed to be a reference to the Group I Collateral, (iii) the term "NFLP
Agreements" shall be deemed to be a reference to the Collateral Agreements, (iv)
the term "Lease" shall be deemed to be a reference to the Group I Lease and (v)
the term "Aggregate Invested Amount" shall be deemed to be a reference to the
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Aggregate Group I Invested Amount, (vi) the term "Eligible Manufacturer" shall
be deemed to be a reference to a Manufacturer and (vii) the term "Eligible
Manufacturer Program" shall be deemed to be a reference to a Manufacturer
Program.
(c) Unless otherwise stated herein, each capitalized term used or
defined herein shall relate only to the Series 1999-1 Notes and not to any other
Series of Notes issued by NFLP.
Section 2.2 Cross References. Article, Section or Subsection references
herein shall refer to Articles, Sections or Subsections of the Base Indenture,
except as otherwise provided herein.
ARTICLE 3
SECURITY
Section 3.1 Grant of Security Interest.
(a) To secure the NFLP Obligations, NFLP hereby pledges, assigns,
conveys, delivers, transfers and sets over to the Trustee, for the benefit of
the Group I Noteholders (the"Secured Parties"), and hereby grants to the
Trustee, for the benefit of the Secured Parties, a security interest in all of
NFLP'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,
together with the portion of the Master Collateral with respect to which the
Trustee is named as a Beneficiary (all of such right, title and interest being
referred to as the "Group I Collateral"):
(i) the Collateral Agreements, including, without limitation,
all monies due and to become due to NFLP from any Lessee or the
Servicer under or in connection with the Collateral Agreements, whether
payable as fees, expenses, costs, indemnities, insurance recoveries,
damages for the breach of any of the Collateral Agreements or
otherwise, all security for amounts payable thereunder and all rights,
remedies, powers, privileges and claims of NFLP against any other party
under or with respect to the Collateral Agreements (whether arising
pursuant to the terms of such Collateral Agreements or otherwise
available to NFLP at law or in equity), the right to enforce any of the
Collateral 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 Collateral Agreements or the
obligations of any party thereunder; and
(ii) all right, title and interest of NFLP in, to and
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under the Receivables Trust Agreement, the Beneficial Interest and the
right to receive all distributions and payments pursuant thereto and in
respect thereof; and
(iii) (a) the Group I Collection 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 the Group
I Collection Account or the funds on deposit therein from time to time,
and (d) all Permitted Investments made at any time and from time to
time with the moneys in the Group I Collection Account or any
administrative subaccount thereof (including income thereon); and
(iv) all right, title and interest of NFLP in, to and under
the Master Collateral Agency Agreement with respect to the portion of
the Master Collateral for which NFLP is designated as a Financing
Source and the Trustee (on behalf of the Secured Parties) is designated
as a Beneficiary thereunder; and
(v) all right, title and interest of NFLP in, to and under all
Eligible Receivables from time to time financed by NFLP hereunder;
(vi) all additional property that may from time to time
hereafter (pursuant to the terms of any Supplement or otherwise) be
subjected to the grant and pledge hereof by NFLP or by anyone on its
behalf; and
(vii) all proceeds, products, rents or profits of any and all
of the foregoing including, without limitation, payments under
insurance (whether or not the Master Collateral Agent or the Trustee is
the loss payee thereof) or Vehicle warranties and cash, but excluding
Excluded Payments and payments under rental agreements with customers
of any Lessee.
The Group I Collateral shall secure the Group I Notes equally and ratably
without prejudice, priority or distinction. No Person other than the Secured
Parties will be entitled to the benefit of any of the Group I Collateral.
(b) To secure the NFLP Obligations with respect to the Group I Notes,
NFLP hereby confirms the grant, pledge, hypothecation, assignment, conveyance,
delivery and transfer to the Receivables Trustee under the Receivables Trust
Agreement, in exchange for the Beneficial Interest, of all NFLP's right, title
and interest in, to, under and in respect of the Lease Payment Rights and the
Manufacturer Payment Rights (other than Excluded Payments).
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(c) To secure the NFLP Obligations with respect to the Group I Notes,
NFLP hereby confirms the grant, pledge, hypothecation, assignment, conveyance,
delivery and transfer to the Master Collateral Agent under the Master Collateral
Agency Agreement for the benefit of the Trustee (on behalf of the Secured
Parties) of a continuing first priority perfected Lien on all right, title and
interest of NFLP in, to and under all the Master Collateral.
(d) The foregoing grant is made in trust to secure the NFLP Obligations
and to secure compliance with the provisions of the Base Indenture and this
Supplement, all as provided in the Base Indenture and this Supplement. The
Trustee, as trustee on behalf of the Secured Parties, acknowledges such grant,
accepts the trusts under the Base Indenture and this Supplement in accordance
with the provisions of the Base Indenture and this Supplement and agrees to
perform its duties required in the Base Indenture and this Supplement to the
best of its abilities to the end that the interests of the Secured Parties may
be adequately and effectively protected.
ARTICLE 4
INITIAL ISSUANCE AND INCREASES AND DECREASES OF
SERIES 1999-1 INVESTED AMOUNT OF SERIES 1999-1 NOTES
Section 4.1 Issuance in Definitive Form. The Series 1999-1 Notes will
be issued in fully registered form without interest coupons, substantially in
the form set forth in Exhibit A hereto, and will be sold to ARG and shall be
duly executed by NFLP and authenticated by the Trustee in the manner set forth
in Section 2.4 of the Base Indenture. Other than in accordance with the ARG
Indenture, the Series 1999-1 Notes will not be permitted to be transferred,
assigned, exchanged or otherwise pledged or conveyed by ARG. The Series 1999-1
Note shall bear a face amount equal to the Series 1999-1 Maximum Invested
Amount, and shall be initially issued in a principal amount equal to the Series
1999-1 Initial Invested Amount. The Trustee shall, or shall cause the Note
Registrar to, record any Increases or Decreases with respect to the Series
1999-1 Invested Amount such that the principal amount of the Series 1999-1 Notes
Outstanding accurately reflects all such Increases and Decreases.
Section 4.2 Procedure for Increasing the Invested Amount.
(a) Subject to satisfaction of the conditions precedent set forth in
subsection (b) of this Section 4.2, (i) on the Series 1999-1 Closing Date, NFLP
may issue Series 1999-1 Notes in the initial principal amount equal to the
Series 1999-1 Initial Invested Amount and (ii) on any Business Day during the
Series 1999-1 Revolving Period, NFLP may increase the Series 1999-1
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Invested Amount (each such increase referred to as an "Increase") in order to,
upon request by a Lessee (or the Servicer, on its behalf), acquire, finance the
acquisition of or refinance Eligible Vehicles for leasing under the Group I
Lease or finance Eligible Receivables hereunder or under the Group I Lease. NFLP
may effect an Increase, upon receipt of confirmation from ARG of the
availability of funds under the ARG Indenture in an amount equal to such
Increase, by issuing, at par, additional principal amounts of the Series 1999-1
Notes. Proceeds from the initial issuance of the Series 1999-1 Notes and from
any Increase shall be deposited into the Group I Collection Account and
allocated in accordance with Article 5 hereof. Upon each Increase, the Trustee
shall, or shall cause the Registrar to, indicate in the Note Register such
Increase.
(b) The initial Series 1999-1 Notes will be issued on the Series 1999-1
Closing Date and the Series 1999-1 Invested Amount may be increased on any
Business Day during the Series 1999-1 Revolving Period, in each case pursuant to
subsection (a) above only upon satisfaction of each of the following conditions
(as evidenced by an Officers' Certificate delivered by NFLP to the Trustee) with
respect to such initial issuance and each proposed Increase:
(i) the amount of such issuance or Increase shall be equal to
or greater than $100,000;
(ii) after giving effect to such issuance or Increase, the
Series 1999-1 Invested Amount shall not exceed the Series 1999-1
Maximum Invested Amount;
(iii) after giving effect to such issuance or Increase and the
application of the proceeds thereof, no Series 1999-1 Enhancement
Deficiency shall exist;
(iv) after giving effect to such issuance or Increase and the
application of the proceeds thereof, the amount of the Series 1999-1
Demand Note shall not be less than the amount referred to in Section
8.9 of this Supplement at such time;
(v) No Amortization Event or Potential Amortization Event with
respect to the Series 1999-1 Notes, Liquidation Event of Default or
Series 1999-1 Limited Liquidation Event of Default with respect to the
Series 1999-1 Notes shall have occurred or be continuing;
(vi) such issuance or Increase or application of the proceeds
thereof shall not result in the occurrence of (a) an Amortization
Event, a Liquidation Event of Default or a Series 1999-1 Limited
Liquidation Event of Default or (b) an event or occurrence, which, with
the passing of time
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or the giving of notice thereof, or both, would become an Amortization
Event, a Liquidation Event of Default or a Series 1999-1 Limited
Liquidation Event of Default;
(vii) such issuance or Increase and the application of the
proceeds thereof shall not result in the occurrence of an ARG
Amortization Event with respect to any series of ARG Notes or an event
or occurrence, which, with the passing of time or the giving of notice
thereof, or both, would become an ARG Amortization Event with respect
to any series of ARG Notes;
(viii) all conditions precedent to the acquisition of
additional Vehicles or refinancing of Eligible Receivables under the
Group I Lease or the refinancing of Eligible Receivables hereunder
shall have been satisfied;
(ix) the Master Collateral Agent shall have previously
received executed counterparts of the Assignment Agreements related to
the assignment of rights under each Manufacturer Program under which
Program Vehicles designated in the applicable Vehicle Order will be or
have been purchased and are proposed to be included in the Aggregate
Asset Amount, duly executed by the applicable Lessee, NFLP, the Master
Collateral Agent and each applicable Manufacturer;
(x) the Master Collateral Agent shall have previously received
a copy of each Manufacturer Program under which Program Vehicles
designated in the applicable Vehicle Order will be or have been
purchased and are proposed to be included in the Aggregate Asset Amount
and an Officer's Certificate duly executed by an Authorized Officer of
the applicable Lessee certifying that each such copy is true, correct
and complete as of such date;
(xi) notice of such Increase shall have been delivered to ARG
and the Trustee;
(xii) all representations and warranties set forth in Article
7 of the Base Indenture and in Section 23 of the Group I Lease shall be
true and correct (in all material respects to the extent any such
representations and warranties do not incorporate a materiality
limitation in their terms) on such date (except to the extent such
representations and warranties relate to an earlier date, in which
case, such representations and warranties shall be true and correct as
of such earlier date);
(xiii) (a) on the Series 1999-1 Closing Date, the Lessees
shall have delivered to the Trustee the original
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Counterpart No. 1 of the Group I Lease (as set forth on the cover page
and signature page of the Group I Lease) and (b) on the date of any
Increase the Trustee shall have in its possession the original of
Counterpart No. 1 of the Group I Lease (as set forth on the cover page
and signature page of the Group I Lease); and
(xiv) if any portion of the proceeds thereof are to be applied
to refinance Eligible Receivables owned by NFLP, NFLP or a Lessee shall
have prepared or shall have caused to be prepared a Refinanced Vehicle
Schedule concerning such Eligible Receivables and delivered such
Refinanced Vehicle Schedule to the Master Collateral Agent and the
Trustee.
Section 4.3 Procedure for Decreasing the Series 1999-1 Invested Amount.
On any Business Day, NFLP may decrease the Series 1999-1 Invested Amount (each
such decrease referred to as a "Decrease") by withdrawing from the Series 1999-1
Excess Collection Account and distributing to the Series 1999-1 Noteholder in
respect of principal on the Series 1999-1 Notes, an amount equal to the amount
of such Decrease in accordance with Section 5.4(b). Upon each Decrease, the
Trustee shall, or shall cause the Registrar to indicate in the Note Register
such Decrease. The amount of any Decrease shall not exceed the amount on deposit
in the Series 1999-1 Excess Collection Account and available for distribution to
Series 1999-1 Noteholder in respect of principal on the Series 1999-1 Notes.
ARTICLE 5
SERIES 1999-1 ALLOCATIONS
Section 5.1 Establishment of Group I Collection Account and Subaccounts
Thereof; Collections.
(a) The Trustee will establish and maintain a segregated trust account
for the benefit of the Group I Noteholders (the "Group I Collection Account").
The Trustee shall possess all right, title and interest in all moneys,
instruments, securities and other property on deposit from time to time in the
Group I Collection Account and the proceeds thereof for the benefit of the
Secured Parties. The Group I Collection Account shall be under the sole dominion
and control of the Trustee for the benefit of the Secured Parties. The Group I
Collection 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 Group I Collection Account; provided that,
if at any time such Qualified Institution is no longer a Qualified Institution
or the credit
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rating of any securities issued by such depository institution or trust company
shall be reduced to below BBB- by S&P or Baa3 by Xxxxx'x, then the Trustee
shall, within 30 days of such reduction, establish a new Group I Collection
Account with a new Qualified Institution or a new 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
Group I Collection Account. If the Group I Collection Account is not maintained
in accordance with the previous sentence, then, within 10 Business Days after
obtaining knowledge of such fact, the Trustee shall establish a new Group I
Collection Account which complies with such sentence and transfer into the new
Group I Collection Account all cash and investments from the non-qualifying
Group I Collection Account. Initially, the Group I Collection Account will be
established with The Bank of New York. All Collections allocable to the Group I
Notes shall be allocated to the Group I Collection Account.
(b) The Trustee will establish and maintain three Administrative
Subaccounts within the Group I Collection Account for the benefit of the Series
1999-1 Noteholder: the Series 1999-1 Collection Account (such Administrative
Subaccount, the "Series 1999-1 Collection Account"), the Series 1999-1 Accrued
Interest Account (such Administrative Subaccount, the "Series 1999-1 Accrued
Interest Account") and the Series 1999-1 Excess Collection Account (such
Administrative Subaccount, the "Series 1999-1 Excess Collection Account"). NFLP
shall instruct the institution maintaining the Group I Collection Account to
invest funds on deposit in the Group I Collection Account (including any
administrative subaccounts thereof) at all times in Permitted Investments
selected by NFLP (by standing instructions or otherwise); provided, however,
that investments of amounts allocated to the Series 1999-1 Excess Collection
Account shall mature no later than the Business Day following the date on which
such funds were invested and investments of all other amounts on deposit in the
Group I Collection Account shall mature not later than the Business Day prior to
the Distribution Date following the date on which such funds were so invested,
except for any Permitted Investment held in the Group I Collection Account
(including any administrative subaccounts thereof) which is in an investment
made by the Trustee, in which event such investment may mature on such
Distribution Date so long as such funds shall be available for withdrawal on or
prior to such Distribution Date. All such Permitted Investments will be credited
to the Group I Collection Account and any such Permitted Investments that
constitute (i) Physical Property (and that is not either a United States
Security Entitlement or a Security Entitlement) shall be delivered to the
Trustee in accordance with paragraph (a) of the definition of "Delivery" and
shall be held by the Trustee pending maturity or disposition; (ii) United States
Security Entitlements or Security Entitlements shall be Controlled by the
Trustee pending maturity or disposition; and
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(iii) Uncertificated Securities (and not United States Security Entitlements)
shall be delivered to the Trustee in accordance with paragraph (b) of the
definition of "Delivery" and shall be maintained by the Trustee pending maturity
or disposition. The Trustee shall, at the expense of NFLP, take such action as
is required to maintain the Trustee's security interest in the Permitted
Investments credited to the Group I Collection Account. In the absence of
written investment instructions hereunder, funds on deposit in the Group I
Collection Account shall remain uninvested. Neither NFLP nor the Trustee shall
dispose of (or permit the disposal of) any Permitted Investments prior to the
maturity thereof to the extent such disposal would result in a loss of principal
of such Permitted Investment.
(c) Until this Supplement is terminated, NFLP shall, and the Trustee is
authorized to, cause all Collections due and to become due to NFLP or the
Trustee, as the case may be, (i) under or in connection with the Master
Collateral for which NFLP is designated as a Financing Source and the Trustee is
designated as a Beneficiary under the Master Collateral Agency Agreement
(including, without limitation, amounts due from Manufacturers and related
auction houses under their Manufacturer Programs with respect to Vehicles other
than Exchanged Vehicles but excluding amounts representing the proceeds from
sales of Vehicles by any Lessee or the Lessor to third parties other than the
Manufacturers, warranty payments and insurance proceeds) to be paid directly to
the Master Collateral Agent for deposit into the Master Collateral Account; (ii)
with respect to amounts representing the proceeds from sales of Vehicles (other
than Exchanged Vehicles) by any Lessee or the Lessor to third parties other than
the Manufacturers to be deposited by such Lessee or the Lessor, as the case may
be, within two Business Days of its receipt thereof into the Master Collateral
Account or the Group I Collection Account; (iii) under the Group I Lease to be
paid directly to the Trustee for deposit into the Group I Collection Account;
and (iv) from any other source (other than Collections excluded under clause (i)
above) to be paid either (a) directly into the Group I Collection Account at
such times as such amounts are due or (b) by any Lessee or the Lessor, as the
case may be, into the Group I Collection Account within two Business Days of its
receipt thereof (and, in each case, NFLP represents to the Secured Parties that
it has instructed the Lessees, the Servicer, the Manufacturers, and any other
source of Collections, as applicable, to so remit such amounts). Upon the
occurrence and during the continuance of an Amortization Event, Potential
Amortization Event or Affiliate Issuer Liquidation Event, insurance proceeds and
warranty payments (with respect to Vehicles other than Exchanged Vehicles) will
be deposited in the Master Collateral Account within two Business Days of their
receipt by any Lessee, the Lessor or the Servicer, as applicable; provided,
however, upon the delivery of an Officer's Certificate of the Servicer to the
Trustee (upon which it may conclusively
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rely) certifying (i) that a Vehicle for which insurance proceeds or warranty
payments (which are not Excluded Payments), as the case may be, have been
received in the Group I Collection Account has been repaired and (ii) as to the
dollar amount of such repairs, the Trustee shall release to the Lessee thereof
insurance proceeds or warranty payments, as the case may be, in such dollar
amount (to the extent not previously applied hereunder). NFLP agrees that if any
such monies, instruments, cash or other proceeds shall be received by NFLP in an
account other than the Master Collateral Account and the Group I Collection
Account or in any other manner, such monies, instruments, cash and other
proceeds will not be commingled by NFLP with any of its other funds or property,
if any, but will be held separate and apart therefrom and shall be held in trust
by NFLP for, and immediately paid over to, but in any event within two Business
Days from receipt, the Trustee or the Master Collateral Agent, as applicable,
with any necessary endorsement. All amounts on deposit in the Master Collateral
Account shall be allocated and distributed to the Trustee and other
Beneficiaries as provided in the Master Collateral Agency Agreement. All monies,
instruments, cash and other proceeds received by the Trustee pursuant to this
Supplement (including amounts received from the Master Collateral Agent) shall
be immediately deposited in the Group I Collection Account and shall be applied
as provided in this Article 5. Notwithstanding the foregoing, to the extent that
the aggregate amount of proceeds received in the Group I Collection Account with
respect to any Financed Vehicle exceeds the Termination Value of such Vehicle,
the Trustee shall, upon the written direction (on which it may conclusively
rely) of NFLP delivered by 12:00 noon (New York City time) on a Business Day,
release such excess to the Lessee thereof on such Business Day, or, if such
written direction is received by the Trustee after 12:00 noon (New York City
time) on a Business Day, on the next succeeding Business Day.
Section 5.2 Allocations with Respect to the Series 1999-1 Notes. The
proceeds from the issuance of the Series 1999-1 Notes will be deposited into the
Group I Collection Account. On the Series 1999-1 Closing Date and each Business
Day on which proceeds from any Increase or Collections are deposited into the
Group I Collection Account (each such date, a "Series 1999-1 Deposit Date"), the
Servicer will direct the Trustee in writing to allocate all amounts deposited
into the Group I Collection Account in accordance with the provisions of this
Section 5.2:
(a) Allocations of Collections During the Series 1999-1
Revolving Period. During the Series 1999-1 Revolving Period, the
Servicer will direct the Trustee in writing to allocate, prior to 12:00
noon (New York City time) on each Series 1999-1 Deposit Date, all
amounts deposited into the Group I Collection Account as set forth
below:
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(i) allocate to the Series 1999-1 Collection Account
an amount equal to the Series 1999-1 Invested Percentage (as
of such day) of the aggregate amount of Interest Collections
on such day. All such amounts allocated to the Series 1999-1
Collection Account shall be further allocated to the Series
1999-1 Accrued Interest Account; and
(ii) allocate to the Series 1999-1 Excess Collection
Account an amount equal to the sum of (A) the Series 1999-1
Invested Percentage (as of such day) of the aggregate amount
of Principal Collections on such day (for any such day, the
"Series 1999-1 Principal Allocation") plus (B) the proceeds
from the issuance of the Series 1999-1 Notes and from any
Increase, which amounts may be applied to make a Decrease in
accordance with Sections 4.3 and 5.4(b).
(b) Allocations During the Series 1999-1 Rapid Amortization
Period. With respect to the Series 1999-1 Rapid Amortization Period,
the Servicer will direct the Trustee in writing to allocate, prior to
12:00 noon (New York City time) on any Series 1999-1 Deposit Date, all
amounts deposited into the Group I Collection Account as set forth
below:
(i) allocate to the Series 1999-1 Collection Account
an amount determined as set forth in Section 5.2(a)(i) above
for such day, which amount shall be further allocated to the
Series 1999-1 Accrued Interest Account; and
(ii) allocate to the Series 1999-1 Collection Account
an amount equal to the Series 1999-1 Principal Allocation for
such day, which amount shall be used to make principal
payments in respect of the Series 1999-1 Notes until the
Series 1999-1 Invested Amount has been reduced to zero.
(c) Series 1999-1 Excess Collection Account. Amounts allocated
to the Series 1999-1 Excess Collection Account on any Series 1999-1
Deposit Date will be first, used to pay the ARG Mandatory Prepayment
Amount pursuant to Section 5.4(c) of this Supplement, second, used to
pay the principal amount of any other Series of Group I Notes that are
then required to be paid under the Base Indenture, as supplemented by
the Supplement relating to such Series of Group I Notes, third, used,
at the option of NFLP, to make a Decrease in accordance with Section
4.3 and 5.4(b) of this Supplement, and fourth, any remaining funds may
be released to NFLP and used by NFLP to finance Eligible Receivables
hereunder or to acquire, refinance or finance the acquisition of
Eligible Vehicles or finance Eligible
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Receivables under, and in accordance with the terms of, the Group I
Lease or for any other purpose, in each case, only to the extent that
no Series 1999-1 Enhancement Deficiency would result from, or exist
after, the release of such funds to NFLP. NFLP may transfer funds to
the Trustee for deposit in the Series 1999-1 Excess Collection Account
on any Business Day. Upon receipt of any such funds, the Trustee shall
deposit them in the Series 1999-1 Excess Collection Account. Upon the
occurrence of a Termination Event, funds allocated to the Series 1999-1
Excess Collection Account will be allocated as Principal Collections by
the Trustee to the Series 1999-1 Collection Account and applied to
reduce the Series 1999-1 Invested Amount on the immediately succeeding
Distribution Date. Prior to financing Eligible Receivables with funds
released from the Series 1999-1 Excess Collection Account, NFLP shall
prepare or cause to be prepared a Refinanced Vehicle Schedule
concerning such Eligible Receivables and deliver or cause to be
delivered such Refinanced Vehicle Schedule to the Master Collateral
Agent and the Trustee.
Section 5.3. Payments To Series 1999-1 Noteholder.
On each Determination Date, as provided below, the Servicer
shall instruct the Trustee in writing to withdraw, and on the following
Distribution Date the Trustee, acting in accordance with such instructions,
shall withdraw the amounts required to be withdrawn from the Group I Collection
Account pursuant to Sections 5.3(a) and (b) below in respect of all funds
available from Interest Collections processed since the preceding Distribution
Date and allocated to the Series 1999-1 Noteholder (less any portion thereof
paid to the Series 1999-1 Noteholder during such period pursuant to Section
5.3(c) below).
(a) Note Interest with respect to the Series 1999-1 Notes. On
each Determination Date, the Servicer shall instruct the Trustee in writing as
to the amount to be withdrawn and paid pursuant to this Section 5.3(a) from
amounts allocated to the Series 1999-1 Accrued Interest Account to the extent
funds are anticipated to be available from Interest Collections allocable to the
Series 1999-1 Notes processed from but not including the preceding Distribution
Date through and including the succeeding Distribution Date in respect of (x)
first, an amount equal to interest accrued on the Series 1999-1 Notes during the
Series 1999-1 Interest Period ending on the day preceding such succeeding
Distribution Date which will be equal to the product of (i) the Series 1999-1
Note Rate for such Series 1999-1 Interest Period and (ii) the average daily
Series 1999-1 Invested Amount during such Series 1999-1 Interest Period, and (y)
then, an amount equal to the amount of any unpaid Deficiency Amounts, as of the
preceding Distribution Date (together with any accrued interest on such
Deficiency Amounts). If the amount available to
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pay the amounts described in clauses (x) and (y) of the preceding sentence of
this Section 5.3(a) is insufficient to pay such amounts on any Distribution
Date, payments of interest to the Series 1999-1 Noteholder will be reduced by
the amount of such deficiency. The amount, if any, of such deficiency on any
Distribution Date shall be referred to as the "Deficiency Amount." Interest
shall accrue on the Deficiency Amount for each Series 1999-1 Interest Period at
the Series 1999-1 Note Rate for such Series 1999-1 Interest Period. On the
following Distribution Date, the Trustee shall, as instructed above, withdraw an
amount equal to the accrued interest on the Series 1999-1 Notes (as determined
above) and the Deficiency Amount, if any (together with accrued interest
thereon), from the Series 1999-1 Accrued Interest Account and pay such amounts
to the Series 1999-1 Noteholder in accordance with Section 6.1 of the Base
Indenture. If the Deficiency Amount (together with interest thereon) is not paid
in full within five (5) days, an Amortization Event with respect to the Series
1999-1 Notes shall occur in accordance with clause (a) of Section 9.1 of the
Base Indenture.
(b) Balance. On each Distribution Date, the Servicer shall
instruct the Trustee in writing to pay the balance (after making the payments
required in Section 5.3(a) of this Supplement), if any, of the Interest
Collections allocated to the Series 1999-1 Noteholder since the preceding
Distribution Date (less any portion thereof paid to the Series 1999-1 Noteholder
during such period pursuant to Section 5.3(c) below) as follows:
(i) on each Distribution Date during the Series
1999-1 Revolving Period, (1) first, to the Servicer, in an
amount equal to the Series Monthly Servicing Fee with respect
to the Series 1999-1 Notes payable by NFLP pursuant to Section
26.1 of the Group I Lease on such Distribution Date, (2)
second, to the Trustee, in an amount equal to the Group I
Percentage with respect to the Series 1999-1 Notes as of the
immediately preceding Distribution Date of the Trustee's fees
for the Series 1999-1 Interest Period ending on such current
Distribution Date, (3) third, to pay any Carrying Charges
(other than Carrying Charges provided for above) to the
Persons to whom such amounts are owed, in an amount equal to
the Group I Percentage with respect to the Series 1999-1 Notes
as of the immediately preceding Distribution Date of such
Carrying Charges (other than Carrying Charges provided for
above) for such Series 1999-1 Interest Period and (4) fourth,
the balance, if any, shall be withdrawn by the Trustee from
the Series 1999-1 Collection Account and paid to NFLP; and
(ii) on each Distribution Date during
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the Series 1999-1 Rapid Amortization Period, (1) first, to the
Trustee, in an amount equal to the Group I Percentage with
respect to the Series 1999-1 Notes as of the immediately
preceding Distribution Date of the Trustee's fees for the
Series 1999-1 Interest Period ending on such current
Distribution Date, (2) second, to the Servicer, in an amount
equal to the Series Monthly Servicing Fee with respect to the
Series 1999-1 Notes payable by NFLP pursuant to Section 26.1
of the Group I Lease on such Distribution Date, (3) third, to
pay any Carrying Charges (other than Carrying Charges provided
for above) to the Persons to whom such amounts are owed, in an
amount equal to the Group I Percentage with respect to the
Series 1999-1 Notes as of the immediately preceding
Distribution Date of such Carrying Charges (other than
Carrying Charges provided for above) for such Series 1999-1
Interest Period and (4) fourth, the balance, if any, shall be
applied to reduce the Series 1999-1 Invested Amount on such
current Distribution Date in accordance with Section 5.4 of
this Supplement.
(c) Interest Payments during Series 1999-1 Interest Period. On
any Business Day during a Series 1999-1 Interest Period, the Servicer may
instruct the Trustee in writing to withdraw, and on such Business Day the
Trustee, acting in accordance with such instructions, shall withdraw, an amount
equal to the lesser of (i) the product of the Issuer's Share on such Business
Day and the amount of interest payable on such Business Day in respect of
interest on the ARG Notes of any series and (ii) the aggregate amount of
Interest Collections processed since the preceding Distribution Date and
allocated to the Series 1999-1 Noteholder (less any portion thereof previously
paid to the Series 1999-1 Noteholder during such period pursuant to this Section
5.3(c)) and shall pay such amounts to the Series 1999-1 Noteholder in accordance
with Section 6.1 of the Base Indenture.
Section 5.4. Payment of Note Principal.
(a) Commencing on the first Determination Date after the
commencement of the Series 1999-1 Rapid Amortization Period and on each
Determination Date thereafter, the Servicer shall instruct the Trustee in
writing as to the amount allocated to the Series 1999-1 Notes during the Related
Month pursuant to Section 5.2(b)(ii) of this Supplement and, as applicable,
allocated pursuant to the last sentence of Section 5.2(c) of this Supplement. On
the Distribution Date following each such Determination Date, the Trustee shall
withdraw the amount allocated to the Series 1999-1 Notes during the Related
Month pursuant to Section 5.2 (b)(ii) of this Supplement and, as applicable,
allocated pursuant to the last sentence of Section
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5.2(c) of this Supplement, from the Group I Collection Account and, in
accordance with Section 6.1 of the Base Indenture, pay such amount to the Series
1999-1 Noteholder, to the extent necessary to pay the Series 1999-1 Invested
Amount during the Series 1999-1 Rapid Amortization Period. The entire principal
amount of all Outstanding Series 1999-1 Notes shall be due and payable on the
Series 1999-1 Termination Date.
(b) On any Business Day during the Series 1999-1 Revolving
Period on which a Decrease pursuant to Section 4.3 of this Supplement shall be
declared, the Trustee shall withdraw from the Group I Collection Account in
accordance with the written instructions of the Servicer an amount equal to the
lesser of (i) the funds then allocated to the Series 1999-1 Excess Collection
Account (including proceeds from any Increase and any amounts allocated to the
Series 1999-1 Excess Collection Account pursuant to Section 5.2(c) of this
Supplement), after giving effect to any payment of the ARG Mandatory Prepayment
Amount on such Business Day, and (ii) the amount of such Decrease, and pay such
amount to the Series 1999-1 Noteholder.
(c) On any Business Day on which funds are available pursuant
to Section 5.2(c) of this Supplement to pay any ARG Mandatory Prepayment Amount,
the Trustee shall withdraw from the Group I Collection Account in accordance
with the written instructions of the Servicer an amount equal to the lesser of
(i) the funds then allocated to the Series 1999-1 Excess Collection Account
(including proceeds from any Increase and any amounts deposited by NFLP in the
Series 1999-1 Excess Collection Account pursuant to Section 5.2(c) of this
Supplement) and (ii) the amount of such ARG Mandatory Prepayment Amount, and pay
such amount to the Series 1999-1 Noteholder.
Section 5.5. The Servicer's Failure to Instruct the Trustee to Make a
Deposit or Payment. If the Servicer fails to give notice or instructions to make
any payment from or deposit into the Group I Collection Account required to be
given by the Servicer, at the time specified herein or in any other Related
Document (including applicable grace periods), the Trustee shall make such
payment or deposit into or from the Group I Collection Account without such
notice or instruction from the Servicer, provided that the Servicer, upon
request of the Trustee, promptly provides the Trustee with all information
necessary to allow the Trustee to make such a payment or deposit. When any
payment or deposit hereunder or under any other Related Document is required to
be made by the Trustee at or prior to a specified time, the Servicer shall
deliver any applicable written instructions with respect thereto reasonably in
advance of such specified time.
Section 5.6. Payments by Wire Transfer. All amounts distributable to
the Series 1999-1 Noteholders pursuant to this Supplement shall be payable by
wire transfer of immediately
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available funds released by the Trustee.
ARTICLE 6
WAIVER AND SUBSTITUTION OF
CERTAIN PROVISIONS OF BASE INDENTURE
Section 6.1. Waiver of Certain Provisions of Base Indenture. By
acquiring a Series 1999-1 Note, each Series 1999-1 Noteholder agrees to waive
compliance by NFLP with the following provisions of the Base Indenture as such
provisions apply to the Series 1999-1 Notes: Section 6.4, Section 7.4, the first
sentence of Section 7.8, Section 8.3, Section 8.14 and Section 8.27.
Section 6.2. Information. NFLP will deliver or cause to be delivered to
the Trustee:
(a) promptly upon the delivery by the Servicer to NFLP, a copy
of the financial information and other materials required to be delivered by the
Servicer to NFLP and the Master Collateral Agent pursuant to the Group I Lease
(delivery of such reports, information and documents to the Trustee is for
informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including NFLP's compliance
with any of its covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers' Certificates));
(b) from time to time such additional information regarding
the financial position, results of operations or business of any Lessee or
Republic as the Trustee may reasonably request to the extent that such Lessee or
Republic, as the case may be, delivers such information to NFLP pursuant to the
Group I Lease (delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including NFLP's compliance
with any of its covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers' Certificates));
(c) at the time of delivery of the items described in clause
(a) above, a certificate of an officer of NFLP that, except as provided in any
certificate delivered in accordance with Section 8.10 of the Base Indenture, no
Amortization Event, Lease Event of Default or (to the best of such officer's
knowledge) Potential Amortization Event or Potential Lease Event of Default has
occurred or is continuing during the applicable fiscal quarter;
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(d) on or prior to June 30 of each year, a certificate of the
chief financial officer of NFLP certifying that no change in the Manufacturer
Program of any manufacturer in respect of any new model year shall have given
rise to any request on the part of the Rating Agencies that any modification be
made to the Group I Lease or any other Related Document, and NFLP has apprised
the Rating Agencies of all material changes in the Manufacturer Programs
occurring since the date of this Supplement;
(e) on or prior to the twentieth day of each month (or if such
day is not a Business Day, on the next succeeding Business Day), a copy of the
Monthly Vehicle Statement relating to the Group I Collateral as of the last
Business Day of the immediately preceding month received by NFLP from the
Servicer pursuant to the Group I Lease; and
(f) promptly following the introduction of any prospective
change in any Manufacturer Program or the introduction of any new Manufacturer
Program by an existing Manufacturer, or, if later, the date NFLP or any Lessee
obtains notice thereof, notice of the same and notice thereof to the Rating
Agencies describing the principal terms thereof, and at least annually a copy of
each Manufacturer Program to the Rating Agencies.
Section 6.3. Manufacturer Programs.
(a) Prior to acquiring or financing the acquisition of any
Program Vehicles under the Group I Lease for any model year or years after the
1999 model year, NFLP will have received (i) an executed Assignment Agreement
with respect to such Manufacturer Program for such model year or years, (ii) if
any Series of Outstanding Group I Notes is held by an Affiliate Issuer and any
series of securities issued by an Affiliate Issuer is then being rated by a
Rating Agency and if so required by any such Rating Agency, a written
confirmation from such Rating Agency that the acquisition of Vehicles pursuant
to such Manufacturer Program satisfies the Rating Agency Confirmation Condition
with respect to such Series of Group I Notes and (iii) if there is a material
change to a Manufacturer Program during a model year, written confirmation from
each such Rating Agency that the acquisition of Program Vehicles pursuant to
such Manufacturer Program satisfies the Rating Agency Confirmation Condition
with respect to each Outstanding Series of Group I Notes. A copy of the rating
confirmations set forth in clauses (ii) and (iii) will promptly be delivered to
the Trustee for delivery to the Noteholders of any Outstanding Series of Group I
Notes.
(b) NFLP will (i) provide the Trustee and the Rating
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Agencies with at least 15 days' prior written notice of its intention to finance
Program Vehicles from any new Manufacturer and (ii) provide the Trustee with a
copy of the draft Manufacturer Program of such Manufacturer as it exists at the
time of such notice and a copy of the final Manufacturer Program promptly upon
its being available. In no event shall NFLP agree, to the extent any consent of
NFLP is solicited or required by the Manufacturer or any assignor of such
Manufacturer Program, to any change in any Manufacturer Program that is
reasonably likely to materially adversely affect its rights or the rights of the
Noteholders with respect to any Program Vehicle previously purchased or financed
under such Manufacturer Program.
Section 6.4. True Lease Opinion. Each of NFLP and the General Partner
acknowledges its receipt of a copy of that certain opinion letter issued by
Xxxxx, Xxxxx & Xxxxx dated the date of issuance of the initial Series of Group I
Notes addressing the characterization of the Operating Lease as a "true lease".
NFLP and the General Partner hereby agree to maintain in place all policies and
procedures, and take and continue to take all action, described in the factual
assumptions set forth in such opinion letter and relating to NFLP or the General
Partner. On an annual basis, commencing on February 26, 2000, NFLP will provide
to the Rating Agencies, the Trustee and the Master Collateral Agent, an
Officer's Certificate certifying that it is in compliance with its obligations
under this Section 6.4.
ARTICLE 7
AMORTIZATION EVENTS
Section 7.1. Amortization Events. In addition to the Amortization
Events set forth in Section 9.1 of the Base Indenture, the following shall be
Amortization Events with respect to the Series 1999-1 Notes and shall constitute
the Amortization Events set forth in Section 9.1(j) of the Base Indenture with
respect to the Series 1999-1 Notes:
(a) a Series 1999-1 Enhancement Deficiency shall occur and
continue for at least two (2) Business Days;
(b) the occurrence of an Event of Bankruptcy with respect to
Republic or any Lessee;
(c) the Group I Lease is terminated for any reason;
(d) all principal and interest of the Series 1999-1 Notes is
not paid in full on or before the Series 1999-1 Termination Date;
(e) NFLP fails to comply with any of its other
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agreements or covenants in, or provisions of, the Series 1999-1 Notes or the
Indenture and the failure to so comply materially and adversely affects the
interests of the Series 1999-1 Noteholder and continues to materially and
adversely affect the interests of the Series 1999-1 Noteholder for a period of
forty-five (45) days after the earlier of (i) the date on which NFLP obtains
knowledge thereof or (ii) the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to NFLP by the Trustee
or to NFLP and the Trustee by the ARG Trustee or the Required Noteholders;
(f) any representation made by NFLP in the Indenture or any
Related Document is false and such false representation materially and adversely
affects the interests of the Series 1999-1 Noteholder and such false
representation is not cured for a period of forty-five (45) days after the
earlier of (i) the date on which NFLP obtains knowledge thereof or (ii) the date
that written notice thereof is given to NFLP by the Trustee or to NFLP and the
Trustee by the ARG Trustee or the Required Noteholders; or
(g) any of the Related Documents or any material portion
thereof shall not be in full force and effect, enforceable in accordance with
its terms or NFLP, any Lessee or the Servicer shall so assert in writing.
In the case of (i) any event described in clause (a), (b), (c) or (d) above, an
Amortization Event with respect to the Series 1999-1 Notes shall immediately
occur without any notice or other action on the part of the Trustee or any
Series 1999-1 Noteholder or (ii) any event described in clause (e), (f) or (g)
above, either the Trustee, by written notice to NFLP, or the Required
Noteholders, by written notice to NFLP and the Trustee, may declare that an
Amortization Event has occurred with respect to the Series 1999-1 Notes as of
the date of the notice. An Amortization Event described in clause (a), (b), (c)
or (d) above shall not be subject to waiver. An Amortization Event described in
clause (e), (f) or (g) above shall be subject to waiver in accordance with
Section 9.5 of the Base Indenture.
Notwithstanding anything to the contrary contained in the Base Indenture, the
occurrence of an event described in Section 9.1(h) of the Base Indenture with
respect to the termination of the Lease dated April 30, 1996 (as amended from
time to time) and the Lease dated October 29, 1997, shall not in and of itself
constitute an Amortization Event with respect to the Series 1999-1 Notes.
Section 7.2. Rights of the Trustee upon Amortization Event or Certain
Other Events of Default. (a) If and whenever an Amortization Event shall have
occurred and be continuing with respect to less than all Outstanding Series of
Group I Notes, the
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Trustee's rights and remedies with respect to the Group I Collateral pursuant to
the provisions of Section 9.2 of the Base Indenture shall, to the extent not
detrimental to the rights of the holders of the Series of Group I Notes with
respect to which no Amortization Event shall have occurred, be limited to rights
and remedies pertaining only to those Series of Group I Notes with respect to
which such Amortization Event has occurred and the Trustee shall exercise such
rights and remedies at the written direction of Group I Noteholders holding in
excess of 50% of the aggregate Invested Amount of all Series of Group I Notes
with respect to which such Amortization Event has occurred.
(b) In addition to, and not in limitation of, the remedies and
duties of the Trustee with respect to the Group I Collateral set forth in the
Base Indenture, if a Liquidation Event of Default or a Series 1999-1 Limited
Liquidation Event of Default shall have occurred and be continuing, the Trustee
may, and at the written direction of the Requisite Investors (in the case of a
Liquidation Event of Default) or at the direction of the Required Noteholders
(in the case of a Series 1999-1 Limited Liquidation Event of Default) shall
direct the Master Collateral Agent to exercise, or cause NFLP or the Lessees to
exercise all rights, remedies, powers, privileges and claims of NFLP, the
Lessees or the Master Collateral Agent, as the case may be, against the
Manufacturers under or in connection with the Manufacturer Programs.
(c) If and whenever the Master Collateral Agent, the Trustee
or NFLP shall exercise their respective rights with respect to the Group I
Collateral pursuant to Section 9.2(c) of the Base Indenture upon the occurrence
of a Series 1999-1 Limited Liquidation Event of Default, each of the Master
Collateral Agent, the Trustee and NFLP shall select the Program Vehicles to be
returned to the related Manufacturers and the Non-Program Vehicles to be sold to
third parties in a manner that does not adversely affect in any material respect
the interests of the Noteholders of any Series of Group I Notes or any
Enhancement Provider with respect thereto.
Section 7.3. Rights of the Trustee upon Affiliate Issuer Liquidation
Event. Upon the occurrence of an Affiliate Issuer Liquidation Event, the Trustee
shall promptly instruct the Master Collateral Agent to return or to cause NFLP
or the Lessees to return Program Vehicles to the related Manufacturers (so long
as a Manufacturer Event of Default has not occurred with respect to the related
Manufacturer) and to sell Non-Program Vehicles or cause Non-Program Vehicles to
be sold to third parties in an amount sufficient to pay the ARG Mandatory
Prepayment Amount, taking into account the availability of proceeds of Vehicles
being disposed of under the Leasing Company Leases, other than the Group I
Lease, plus any interest on the Series 1999-1 Notes relating thereto, and to the
extent that any Manufacturer fails
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to accept any such Program Vehicles under the terms of the applicable
Manufacturer Program (or if a Manufacturer Event of Default has occurred with
respect to the related Manufacturer), to direct the Master Collateral Agent to
liquidate or to cause NFLP or the Lessees to liquidate such Program Vehicles in
accordance with the rights of NFLP under the Group I Lease; provided, however,
that the Master Collateral Agent, the Trustee and NFLP shall select the Program
Vehicles to be returned to the related Manufacturers and the Non-Program
Vehicles to be sold to third parties in a manner that does not adversely affect
in any material respect the interests of the Noteholders of any Series of Group
I Notes or any Enhancement Provider with respect thereto.
ARTICLE 8
GENERAL
Section 8.1. Optional Repurchase. The Series 1999-1 Notes shall be
subject to repurchase by NFLP at its option in accordance with Section 6.3 of
the Base Indenture, with no less than two Business Days' prior written notice to
the Series 1999-1 Noteholder on any Business Day (the "Repurchase Date"). The
repurchase price for the Series 1999-1 Notes shall equal the Repurchase Amount
on the Repurchase Date.
Section 8.2. Information. NFLP shall cause the Servicer to prepare or
cause to be prepared all reports and statements required to be prepared and
delivered by ARG pursuant to the ARG Non-Segregated Series Supplements and shall
cause the Servicer to furnish or cause to be furnished all such reports and
statements at the times and to the Persons specified in the ARG Non-Segregated
Series Supplements.
Section 8.3. Exhibits. The following exhibits attached
hereto supplement the exhibits included in the Indenture.
Exhibit A: Form of Variable Funding Note
Exhibit B: Form of Series 1999-1 Demand Note
Section 8.4. Ratification of Base Indenture. As supplemented by this
Supplement, the Base Indenture is in all respects ratified and confirmed and the
Base Indenture as so supplemented by this Supplement shall be read, taken, and
construed as one and the same instrument.
Section 8.5. 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.
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Section 8.6. Governing Law. This Supplement shall be construed in
accordance with the law of the State of New York, and the obligations, rights
and remedies of the parties hereto shall be determined in accordance with such
law.
Section 8.7. Amendments. This Supplement may be modified or amended
from time to time in accordance with the terms of the Base Indenture, provided
that no consent of the Required Noteholders shall be required for any change in
the Series 1999-1 Maximum Invested Amount. Any Related Document may be modified
or amended from time to time in accordance with the terms of Section 12.1 of the
Base Indenture, provided that no consent of Group I Noteholders shall be
required to any amendment, modification or waiver of or to any Related Document
if such amendment, modification or waiver does not adversely affect in any
material respect the Group I Noteholders of any Series of Group I Notes (as
substantiated by an Opinion of Counsel to such effect, which Opinion of Counsel
may, to the extent same is based on any factual matter, rely upon an Officer's
Certificate as to the truth of such factual matter) and provided further that
the Rating Agency Confirmation Condition is satisfied with respect to each
affected Series of Group I Notes.
Section 8.8. Notice to Rating Agencies. The Trustee shall provide to
each Rating Agency a copy of each notice delivered to, or required to be
provided by, the Trustee pursuant to this Supplement or any other Related
Document.
Section 8.9. Series 1999-1 Demand Note. Other than pursuant to a demand
thereon, NFLP may acquire the Series 1999-1 Demand Note and shall not reduce the
amount of the Series 1999-1 Demand Note or forgive amounts payable thereunder so
that the outstanding principal amount of the Series 1999-1 Demand Note after
such reduction or forgiveness is less than an amount equal to 5.0% of the Series
1999-1 Invested Amount; provided, however, that if NFLP has first delivered to
the Trustee an Opinion of Counsel that reduction or forgiveness of amounts owing
under the Series 1999-1 Demand Note to an amount less than 5.0% of the Series
1999-1 Invested Amount will not have an adverse effect on the tax
characterization of the Series 1999-1 Notes or any series of ARG Notes, NFLP may
reduce the amount of the Series 1999-1 Demand Note or forgive amounts payable
thereunder to an amount less than 5.0% of the Series 1999-1 Invested Amount.
NFLP shall not distribute the proceeds of any payment made in respect of the
principal amount of the Series 1999-1 Demand Note to the owners of its
partnership interests, nor shall NFLP lend any of such proceeds to Republic or
any Affiliate of Republic under the Subordinated Note or otherwise unless, after
giving effect to such distribution or loan, the outstanding principal amount of
the Series 1999-1 Demand Note is at least equal to 5.0% of the Series 1999-1
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Invested Amount (or such lesser percentage permitted under the immediately
preceding sentence). NFLP may enter into that certain Receivables Trust
Agreement dated as of the date hereof with The Bank of New York (Delaware) with
respect to the Series 1999-1 Demand Note and the Subordinated Note.
Section 8.10. Subordinated Note. Subject to Section 8.9, NFLP may
advance funds to Republic pursuant to the Subordinated Note from time to time;
provided, however that upon the occurrence and during the continuance of an
Amortization Event, NFLP shall not advance any additional amounts under the
Subordinated Note.
Section 8.11. Additional Series of Group I Notes. NFLP shall not issue
any additional Series of Group I Notes unless the Trustee shall have received
written confirmation that the Rating Agency Confirmation and Consent Condition
with respect to each Outstanding Series of Group I Notes shall have been
satisfied with respect to such issuance.
Section 8.12. Year 2000. The Trustee hereby represents and warrants
that it has established a Year 2000 compliance program consisting of, among
other things, updating major proprietary application systems and evaluating the
Year 2000 compliance efforts of vendors of major vendor-supplied systems and
certain other business partners. The Trustee believes that its Year 2000
compliance program is currently on schedule to meet the needs of its customers
and the compliance deadlines defined by its regulators. As of December 31, 1998,
testing and renovation of the proprietary application systems that the Trustee
deems "mission critical" were substantially completed and these systems are
currently being used by the Trustee. In addition, all vendor supplied software
systems that the Trustee deems mission critical have been tested and, based upon
such testing, the Trustee believes that such systems will not be adversely
affected in a material way as a result of the date change to the Year 2000. Due
to the general uncertainty inherent in the Year 2000 problem, resulting in part
from the uncertainty of the Year 2000 readiness of suppliers, customers and
other business partners, the Trustee is unable to determine at this time whether
the consequences of Year 2000 failures will have a material impact on the
Trustee and its ability to perform its obligations under this Supplement and the
Base Indenture. The Year 2000 compliance program is intended to reduce
significantly the Trustee's level of uncertainty about the Year 2000 problem
and, in particular, the Year 2000 compliance and readiness of the Trustee and
its material business partners. The Trustee believes that, with completion of
its Year 2000 compliance program as scheduled, the possibility of significant
interruptions of normal operations should be reduced. However, because of the
unprecedented nature of the Year 2000 problem, there can be no certainty as to
its impact.
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[Remainder of Page Intentionally Blank]
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IN WITNESS WHEREOF, NFLP and the Trustee have caused this Supplement to
be duly executed by their respective officers thereunto duly authorized as of
the day and year first above written.
NATIONAL CAR RENTAL FINANCING LIMITED
PARTNERSHIP
By: NATIONAL CAR RENTAL FINANCING
CORPORATION, its general partner
By:
------------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By:
------------------------------------
Name:
Title:
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ANNEX A TO THE
SERIES 1999-1 SUPPLEMENT
Definitions List
Dated as of February 26, 1999
"Accrued Amounts" means, with respect to any Series of Group I Notes
(or any class of such Series of Notes), on any date of determination, the sum of
(i) accrued and unpaid interest on such Series of Group I Notes as of such date,
(ii) the accrued and unpaid Series Monthly Servicing Fee with respect to such
Series of Group I Notes payable by NFLP pursuant to Section 26.1 of the Group I
Lease on such date and (iii) the product of (A) the Carrying Charges payable on
such date times (B) the Group I Percentage with respect to such Series of Group
I Notes as of the immediately preceding Distribution Date.
"Acquired Vehicle" means an Eligible Vehicle that is acquired or owned
by, and titled in the name of, NFLP and leased to a Lessee under Annex A to the
Group I Lease on or after the Lease Commencement Date.
"Additional Base Rent" is defined in Section 6 of Annex B to the Group
I Lease.
"Additional Lessee Closing Date" means the initial Vehicle Funding Date
with respect to Vehicles (including Refinanced Vehicles) leased by an Additional
Lessee.
"Additional Lessees" means those Subsidiaries of Republic from time to
time becoming Lessees under the Group I Lease in accordance with the
requirements of Section 29 of the Group I Lease.
"Additional Permitted Beneficiaries" means, on any date, the
Subordinated Creditors under (and as defined in) the Intercreditor Agreement
that are named on such date as Beneficiaries under the Master Collateral Agency
Agreement in respect of Lessee Grantor Master Collateral.
"Additional Spread Percentage" means, as of any date of determination,
the greater of 2.00% or such other percentage as the Lessor and the Lessees may
from time to time agree in writing shall be the Additional Spread Percentage, as
evidenced by and in effect from the date of delivery of a copy of such writing
duly executed by the Lessor and the Lessees to the Trustee and the Servicer.
"Administrative Subaccount" means an internal administrative account
established by the Trustee for record keeping purposes to facilitate the proper
allocation of Collections within the
29
Group I Collection Account.
"Affiliate" means, with respect to any specified Person, another Person
that directly, or indirectly through one or more intermediaries, controls or is
controlled by or is under common control with the Person specified. For purposes
of this definition, "control" means the power to direct the management and
policies of a Person, directly or indirectly, whether through ownership of
voting securities, by contract or otherwise; and "controlled" and "controlling"
have meanings correlative to the foregoing. For purposes of the Group I Lease,
the Lessor shall not be considered to be an Affiliate of any Lessee.
"Affiliate Issuer" means ARG and any other special purpose entity that
is an Affiliate of Republic that has entered into financing arrangements secured
by one or more Series of Notes.
"Affiliate Issuer Liquidation Event" means, with respect to (i) the
Series 1999-1 Notes, any one of the events with respect to any series of the ARG
Notes defined as a "Series ARG Liquidation Event" with respect to such series in
the related ARG Non-Segregated Series Supplement, and (ii) any other Series of
Group I Notes, any event specified as a Series Affiliate Issuer Liquidation
Event in the related Supplement.
"Affiliate Joinder in Lease" is defined in Section 29.1 of the Group I
Lease.
"Aggregate Asset Amount" means, for any date of determination, the sum,
rounded to the nearest $100,000, of (i) the Net Book Value of all Vehicles that
are Eligible Vehicles leased under the Group I Lease as of such date and not
turned in to the Manufacturer thereof pursuant to its Manufacturer Program, not
delivered for Auction pursuant to any Manufacturer Program or not otherwise sold
or deemed to be sold under the Related Documents, plus (ii) all amounts
receivable by the Lessor or a Lessee under the Group I Lease as of such date
(other than Excluded Payments) from Manufacturers under Manufacturer Programs
with respect to Eligible Vehicles (other than Exchanged Vehicles) turned in to
such Manufacturers pursuant to any such Manufacturer Program or delivered for
Auction pursuant to any Manufacturer Program and the aggregate of all Eligible
Receivables owned by a Lessee or the Lessor financed under the Group I Lease or
the Indenture, as applicable, plus (iii) with regard to Eligible Vehicles leased
under the Group I Lease that have been delivered for Auction pursuant to a
Manufacturer Program with a Manufacturer, all amounts receivable (other than
amounts specified in clause (ii)) from any person or entity in connection with
the Auction of such Eligible Vehicles as of such date, plus (iv) with regard to
Eligible Vehicles that have been turned in to the Manufacturer, delivered for
Auction or otherwise sold, any Casualty Payments or Termination Payments with
respect to such Eligible Vehicles due and payable as of such date under the
Group I Lease, plus (v) with regard to Eligible Vehicles that have been turned
in to the Manufacturer, delivered for Auction or otherwise sold, any accrued and
unpaid Monthly Base Rent, Monthly Supplemental Payments and Additional Base Rent
under the Group I Lease with respect to such Eligible Vehicles (net of amounts
set forth in clauses (ii), (iii) and (iv) above), plus (vi) cash and Permitted
Investments on deposit in the Series 1999-1 Collection Account, minus (vii) any
Ineligible Asset Amount on
30
such date.
"Aggregate Group I Invested Amount" means the sum of the Invested
Amounts of all Series of Group I Notes.
"Alamo" means Alamo Rent-A-Car, Inc., a Florida corporation, and any
successor thereto.
"Alamo Lease" means the Master Motor Vehicle Lease and Servicing
Agreement, dated as of the date hereof, executed in connection with the issuance
by Alamo Leasing of the Variable Funding Rental Car Asset Backed Notes, Series
1999-1, among Alamo Leasing, as lessor, Alamo, as lessee, and Republic, as
guarantor and servicer, as the same may be amended, supplemented, restated or
otherwise modified from time to time in accordance with the terms thereof.
"Alamo Leasing" means Alamo Financing L.P., a special purpose Delaware
limited partnership, and any successor thereto.
"ARG" means ARG Funding Corp., a special purpose Delaware corporation,
and its successors or assigns.
"ARG Agreements" means the ARG Indenture and any other agreements
relating to the issuance of any series of ARG Notes to which ARG is a party.
"ARG Amortization Event" means any one of the events with respect to
any series of the ARG Notes described in Section 9.1 of the ARG Indenture.
"ARG Base Indenture" means the Base Indenture, dated as of February 26,
1999, between ARG and The Bank of New York, as trustee, as amended, modified,
restated or supplemented from time to time, exclusive of supplements thereto
creating new series of ARG Notes.
"ARG Committed Purchaser" means a special purpose company that has
committed to purchase a series of ARG Notes from ARG from time to time and that
finances such purchases with, among other things, the proceeds of commercial
paper notes issued by such special purpose company.
"ARG Indenture" means the ARG Base Indenture, as supplemented by the
ARG Non-Segregated Series Supplements.
"ARG Mandatory Prepayment Amount" means, on any Business Day, the
aggregate outstanding principal amount of the ARG Notes of any series with
respect to which an ARG Amortization Event shall have occurred and is
continuing.
31
"ARG Non-Segregated Series Supplement" means a Supplement to the ARG
Base Indenture between ARG and the ARG Trustee pursuant to which a series of ARG
Notes were issued and are outstanding.
"ARG Noteholder" means a Person in whose name an ARG Note is registered
in accordance with the ARG Indenture.
"ARG Notes" means any one of the series of Rental Car Asset Backed
Notes issued by ARG pursuant to the ARG Base Indenture that are secured by
collateral that includes, among other things, a security interest in all of
ARG's right, title and interest in the Group I Notes.
"ARG Revolving Period Termination Date" means the first day on which
the principal amount of each series of ARG Notes outstanding is amortizing in
accordance with the applicable ARG Non-Segregated Series Supplement and no ARG
Noteholder is obligated to make further investments in its ARG Notes under the
applicable ARG Non-Segregated Series Supplement or otherwise.
"ARG Trustee" means the party named as such in the ARG Base Indenture
until a successor replaces it in accordance with the applicable provisions of
the ARG Base Indenture and thereafter means the successor serving thereunder.
"Assignment Agreement" means the agreement with respect to each
Manufacturer and its Manufacturer Program, entered into or to be entered into
among Lessor and/or one or more Lessees, as assignor, and the Master Collateral
Agent, as assignee, and acknowledged by such Manufacturer, assigning to the
Master Collateral Agent certain of Lessor's and/or such Lessees' right, title
and interest in such Manufacturer's Manufacturer Program as it relates to
Vehicles purchased from such Manufacturer.
"Authorized Officer" means (a) as to NFLP, any of the President, any
Vice-President, the Secretary or any Assistant Secretary or the Treasurer or any
Assistant Treasurer of the General Partner and those officers, employees and
agents of the General Partner whose signatures and incumbency shall have been
certified to the Trustee in such certificates as may be delivered by the General
Partner to the Trustee from time to time as duly authorized to execute and
deliver the Group I Lease and any instruments, certificates, notices and other
documents in connection therewith on behalf of the General Partner or NFLP and
to take, from time to time, all other actions on behalf of the General Partner
or NFLP in connection therewith and (b) as to the Servicer or any Lessee, any of
the President, any Vice President, the Secretary or any Assistant Secretary, the
Treasurer or any Assistant Treasurer, and those officers, employees and agents
of the Servicer or such Lessee whose signatures and incumbency shall have been
certified to NFLP in such certificates as may be delivered by the Servicer or
such Lessee to NFLP from time to time as duly authorized to execute and deliver
the Group I Lease and any instruments, certificates, notices and other documents
in connection therewith on behalf of the Servicer or such Lessee and to take,
from time to time, all other actions on behalf of the Servicer or such
32
Lessee in connection therewith.
"Base Amount" means, as of any date of determination, with respect to
the Financing Lease, the sum of (i) the Net Book Values of all Financed Vehicles
leased under the Financing Lease as of such date, plus, (ii) all past due and
unpaid Monthly Base Rent and Additional Base Rent under the Financing Lease as
of such date.
"Base Indenture" is defined in the preamble.
"Beneficial Interest" means the 100% beneficial interest owned by NFLP
in the Receivables Trust.
"Beneficiary" is defined in the preamble to the Master Collateral
Agency Agreement.
"Board of Directors" means the Board of Directors of Republic, the
General Partner or any of the Lessees, as applicable, or any authorized
committee of such Board of Directors.
"Business Day" means any day other than a Saturday, Sunday or other day
on which banks are authorized or required by law to be closed in New York City,
New York or Chicago, Illinois.
"Capitalized Cost" means, (i) with respect to each Vehicle (other than
a Refinanced Vehicles) the amount payable to the Manufacturer, dealer or other
seller selling such Vehicle in order to purchase such Vehicle, as established by
the invoice delivered in connection with such Vehicle, and (ii) with respect to
each Vehicle that is a Refinanced Vehicle, the initial purchase price thereof
(as established by the invoice delivered in connection with such Vehicle at the
time the Lessee purchased such Vehicle) less all Depreciation Charges accrued
through the Vehicle Funding Date for such Vehicle; provided, however, that with
respect to any Vehicle, "Capitalized Cost" may include dealer profit to the
extent consistent with reasonable industry standards and delivery charges but
shall not include any taxes, registration fees or titling fees with respect to
such Vehicle.
"Car Temps" means Spirit Rent-A-Car, Inc. d/b/a Car Temps USA, an Ohio
corporation, and any successor thereto.
"Car Temps Lease" means the Master Motor Vehicle Lease and Servicing
Agreement, dated as of the date hereof, executed in connection with the issuance
by Car Temps Leasing of the Variable Funding Rental Car Asset Backed Notes,
Series 1999-1, among Car Temps Leasing, as lessor, Car Temps, as lessee, and
Republic, as guarantor and servicer, as the same may be amended, supplemented,
restated or otherwise modified from time to time in accordance with the terms
thereof.
"Car Temps Leasing" means Car Temps Financing L.P., a special purpose
Delaware
33
limited partnership, and any successor thereto.
"Carrying Charges" means, as of any day, without duplication, the
aggregate of all Trustee fees, Monthly Servicing Fees and other fees and
expenses and indemnity amounts, if any, payable by NFLP under the Indenture (and
not allocated by NFLP to any Series of Notes other than the Group I Notes) or
the other Related Documents (including all fees payable in connection with any
Enhancement), out-of-pocket expenses of NFLP incurred in connection with the
execution, delivery and performance of the Related Documents and all other
operating expenses of NFLP or the General Partner (including independent
director fees and management fees, any fees payable to the Rating Agencies in
connection with their rating of any Series of Group I Notes and any fees or
commissions payable in connection with the sale of any Series of Group I Notes),
in each case, which have accrued since the most recent Distribution Date and any
such amounts which had accrued as of the most recent Distribution Date and
remain unpaid.
"Casualty" means, with respect to any Vehicle, that (i) such Vehicle is
lost, converted or stolen for a period of at least 90 days, (ii) such Vehicle is
destroyed, seized or otherwise rendered permanently unfit or unavailable for use
(including vehicles that are rejected pursuant to Section 2.2 of the Group I
Lease) or (iii) in the case of a Program Vehicle not redesignated under Section
14 of the Group I Lease, the return of such Vehicle cannot be, or is not,
effected for any reason or the Manufacturer thereof did not accept such Vehicle
for repurchase or Auction under the terms of the applicable Manufacturer
Program, in either case, for any reason other than the Manufacturer's willful
refusal or inability to comply with its obligations under its Manufacturer
Program.
"Casualty Payment" is defined in Section 7 of the Group I Lease.
"Certificated Security" means a "certificated security" within the
meaning of the applicable UCC.
"Collateral Agreements" means the Assignment Agreements, the Group I
Lease, the Master Collateral Agency Agreement, the Receivables Trust Agreement
and any other agreements relating to the Group I Lease or the Vehicles to which
NFLP is a party.
"Collections" means (i) all payments by, or on behalf of, any Lessee
under the Group I Lease, (ii) all payments on the Master Collateral allocable to
the Trustee as a Beneficiary, including payments made by or on behalf of any
Manufacturer or auction dealer, under the related Manufacturer Program with
respect to Vehicles, but excluding Excluded Payments and payments made
thereunder with respect to Exchanged Vehicles, (iii) all payments by or on
behalf of any other Person as proceeds from the sale of Vehicles (other than
Exchanged Vehicles) or payments of insurance proceeds and warranty payments
which are required to be deposited into the Master Collateral Account, whether
such payments are in the form of cash, checks, wire transfers or other forms of
payment and whether in respect of principal, interest, repurchase price, fees,
expenses or otherwise and (iv) all amounts earned on Permitted Investments of
funds
34
in the Group I Collection Account.
"Company Vehicle" means an Eligible Vehicle that is titled in the name
of NFLP in the States of Hawaii, Texas, Louisiana, Nevada, New Mexico,
Washington, Oklahoma, Maryland or Delaware or any other state determined by the
applicable Lessee, the lease of which shall be pursuant to Annex B to the Group
I Lease.
"Consistent Basis" in reference to the application of GAAP means the
accounting principles observed in the period referred to are comparable in all
material respects to those applied in the preparation of the audited financial
statements of Republic, any of the Lessees or NFLP, as applicable.
"Consolidated Subsidiary" means, at any time, with respect to any
Lessee or the Guarantor, any Subsidiary or other entity the accounts of which
would be consolidated with those of such Lessee or the Guarantor, as the case
may be, in its consolidated financial statements as of such time.
"Control" means (a) with respect to a Security Entitlement, the Trustee
(i) is identified in the records of the Securities Intermediary for such
Security Entitlement as the person having such Security Entitlement against such
Security Intermediary or (ii) has obtained the agreement, in writing, of the
Securities Intermediary for such Security Entitlement that it will comply with
orders of the Trustee regarding the transfer or redemption of such Security
Entitlement without further consent of any other person; or (b) with respect to
a United States Security Entitlement, (i) the Trustee is a participant in the
book entry system maintained by the Federal Reserve Bank that is acting as a
fiscal agent for the issuer of such United States Security Entitlement and such
Federal Reserve Bank has indicated by book entry that such United States
Securities Entitlement has been credited to the Trustee's securities account in
such book entry system or (ii) (A) the Trustee (x) is identified in the records
of the Securities Intermediary for such United States Security Entitlement as
the person having such Security Entitlement against such Securities Intermediary
or (y) has obtained the agreement, in writing, of the Securities Intermediary
for such Security Entitlement that it will comply with orders of the Trustee
regarding the transfer or redemption of such Security Entitlement without
further consent of any other person, (B) the Securities Intermediary for such
United States Securities Entitlement is a participant in the book entry system
maintained by the Federal Reserve Bank that is acting as fiscal agent for the
issuer of such United States Securities Entitlement and (C) such Federal Reserve
Bank has indicated by book entry that such United States Securities Entitlement
has been credited to such Securities Intermediary's securities account in such
book entry system.
"Controlled Group" means, with respect to any Person, such Person,
whether or not incorporated, and any corporation, trade or business that is
required to be treated, along with such Person, as a single controlled group of
corporations or a controlled group of trades or businesses as described in
Section 414(b) of the Code.
"Daily Report" is defined in Section 24.6(v) of the Group I Lease.
35
"Decrease" is defined in Section 4.3 of this Supplement.
"Defaulting Manufacturer" is defined in Section 18 of the Group I
Lease.
"Deficiency Amount" is defined in Section 5.3(a) of this Supplement.
"Delivery" means (a) with respect to any Physical Property (that is not
either a United States Security Entitlement or a Security Entitlement), physical
delivery thereof to the Trustee or its nominee or custodian by an effective
endorsement, or registered in the name of, the Trustee or its nominee or
custodian endorsed in blank and (b) with respect to any Uncertificated Security,
the issuer thereof registers the Trustee as the registered owner thereof or the
Trustee otherwise satisfies the requirements of Revised Article 8.
"Depreciation Charge" means, with respect to (a) any Program Vehicle
subject to the GM Repurchase Program, the rate determined by dividing (x) 100%
minus the repurchase price percentage specified in respect of such Vehicle
pursuant to the terms of the GM Repurchase Program for the Designated Period
applicable to such Vehicle by (y) the number of days in such Designated Period
(or, if such Vehicle is held past the Designated Period set forth in the Vehicle
Order relating to such Vehicle, the applicable depreciation charge set forth in
the GM Repurchase Program for such Vehicle calculated on a daily basis), (b) any
Program Vehicle subject to a Manufacturer Program other than the GM Repurchase
Program (but including any other Manufacturer Program provided by GM), the
applicable depreciation charge set forth in the related Manufacturer Program for
such Vehicle with respect to such Vehicle calculated on a daily basis and (c)
any Non-Program Vehicle, the scheduled daily depreciation charge for such
Vehicle set forth by or on behalf of the Servicer in the Depreciation Schedule
for such Vehicle. If such charge is expressed as a percentage, the daily
Depreciation Charge for such Vehicle shall be such percentage multiplied by the
Capitalized Cost for such Vehicle calculated on a daily basis. For Vehicles not
held for a full month in the month of acquisition, the Depreciation Charges
shall be prorated by multiplying the applicable depreciation amount by a
fraction, the numerator of which is the number of days from the date
depreciation related to such Vehicle begins to the first day of the next month
and the denominator of which is the number of days in such month. For the month
in which a Program Vehicle is turned back to the applicable Manufacturer, the
Depreciation Charge shall be prorated by multiplying the applicable depreciation
amount by a fraction, the numerator of which is the number of days from the
first day of such month to the Turnback Date for such Vehicle and the
denominator of which is the number of days in such month. In the event a Vehicle
is sold (other than pursuant to the Manufacturer Program of a Manufacturer), the
Depreciation Charge for the month in which such Vehicle is sold shall be
prorated by multiplying the applicable depreciation amount by a fraction, the
numerator of which is the number of days from the first day of such month to the
date proceeds were received by the Trustee from the sale of such Vehicle and the
denominator of which is the number of days in such month.
"Depreciation Schedule " means the initial schedule of estimated daily
depreciation
36
prepared by the Servicer with respect to each type of Non-Program Vehicle that
is an Eligible Vehicle, as revised from time to time by the Servicer thereof in
its sole discretion, subject to Section 24.18 of the Group I Lease.
"Designated Period" means, with respect to any Program Vehicle subject
to the GM Repurchase Program, the period designated by or on behalf of the
Servicer in the applicable Vehicle Order relating to such Vehicle as the period
of time for which the Servicer expects such Vehicle to be subject to the Group I
Lease.
"Designated Vehicle " means a Vehicle owned by NFLP or a Financed
Vehicle owned by any Lessee with respect to which the Servicer, the Lessee
thereof or NFLP has notified the Master Collateral Agent in writing that such
Vehicle has been designated to be exchanged for one or more Replacement Vehicles
or released for exchange pursuant to an Exchange Agreement.
"Determination Date" means the date three Business Days prior to each
Distribution Date.
"Disposition Date" means with respect to any Program Vehicle or
Non-Program Vehicle, (i) if such Vehicle was sold at Auction pursuant to a
Guaranteed Depreciation Program or returned to a Manufacturer for repurchase
pursuant to a Repurchase Program, the Turnback Date, (ii) if such Vehicle is an
Exchanged Vehicle, the date on which such Vehicle became an Exchanged Vehicle,
(iii) if such Vehicle was sold to any Person (other than to a Manufacturer
pursuant to such Manufacturer's Repurchase Program or to a third party through
an auction conducted by or through or arranged by the Manufacturer pursuant to
its Guaranteed Depreciation Program), the date on which the proceeds of such
sale are received by the Lessor, the Master Collateral Agent or the Trustee or
(iv) if such Vehicle becomes a Casualty or otherwise ceases to be an Eligible
Vehicle (except as a result of a sale thereof), the date on which a Casualty
Payment is received by the Lessor or the Trustee.
"Distribution Date" means, with respect to the Series 1999-1 Notes, the
20th day of each calendar month or, if such day is not a Business Day, the next
succeeding Business Day, commencing March 22, 1999.
"Due Date" means, with respect to any payment due from a Manufacturer
or auction dealer in respect of a Program Vehicle turned back for repurchase
pursuant to the terms of the related Manufacturer Program, the thirtieth (30th)
day after the Disposition Date for such Vehicle.
"Eligible Affiliate" means an Affiliate of Republic that regularly
operates a United States domestic daily car rental business and is not a Lessee.
"Eligible Franchisee" means a franchisee of a Lessee having rental
offices located in the
37
United States which meets the normal credit and other approval criteria of such
Lessee, and which may be an Affiliate of such Lessee; provided that no Lessee
shall permit any Eligible Franchisee to garage or lease Vehicles at offices
outside of the United States.
"Eligible Receivable" means a legal, valid and binding receivable (a)
due from a Manufacturer under a Manufacturer Program (other than Excluded
Payments) to the Lessor or any Lessee or a creditor of such Lessee, (b) in
respect of a Program Vehicle purchased by such Manufacturer, or sold at auction
pursuant to such Manufacturer's Manufacturer Program, and with respect to which
either (i) the Lien of the Master Collateral Agent was noted on the Certificate
of Title at the time of purchase or (ii) such Vehicle is in the Initial Fleet of
a Lessee seeking to refinance such receivable, (c) owned by the Lessor or such
Lessee or such creditor free and clear of all Liens other than Permitted Liens
and (d) the right to payments in respect of which has been assigned by the payee
thereof to the Master Collateral Agent and with respect to which the Trustee is
designated as the Beneficiary pursuant to the Master Collateral Agency
Agreement; provided that no amount receivable from a Manufacturer under a
Manufacturer Program shall be an Eligible Receivable at the time of being
financed or refinanced if such amount remains unpaid more than ten (10) days
after the Due Date in respect of such payment.
"Eligible Vehicle" means, on any date of determination, a Vehicle (i)
that either is a Program Vehicle or a Non-Program Vehicle, in each case at the
time of leasing under the Group I Lease, (ii) that is not older than forty-eight
(48) months from the date of the original manufacturer invoice therefor, (iii)
that is owned by NFLP or the Lessee thereof free and clear of all Liens other
than Permitted Liens, (iv) other than, to the extent permitted under the Group I
Lease, Vehicles in the Initial Fleet, with respect to which the Master
Collateral Agent is noted as the first lienholder on the Certificate of Title
therefor, or the Certificate of Title has been submitted to the appropriate
state authorities for such notation and (v) that is a Related Vehicle with the
Trustee designated as the Beneficiary pursuant to the Master Collateral Agency
Agreement.
"Excess Damage Charges" means, with respect to any Program Vehicle, the
amount charged to NFLP (or any Lessee), or deducted from the Repurchase Price,
by the Manufacturer of such Vehicle due to (i) damage over a prescribed limit,
(ii) if applicable, damage not subject to a prescribed limit and (iii) missing
equipment, in each case with respect to such Vehicle at the time such Vehicle is
turned in to such Manufacturer or its agent or designee for repurchase or
Auction pursuant to the applicable Manufacturer Program.
"Excess Mileage Charges" means, with respect to any Program Vehicle,
the amount charged to NFLP (or any Lessee), or deducted from the Repurchase
Price, 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 turned in to
such Manufacturer or its agent or designee for repurchase or Auction pursuant to
the applicable Manufacturer Program.
"Exchange Agreement" means an agreement among NFLP, any Lessee and a
Qualified
38
Intermediary which provides for the assignment by NFLP and such Lessee,
respectively, to such Qualified Intermediary of (a) Exchanged Vehicles, (b) all
Exchanged Vehicle Repurchase Rights, (c) all right, title and interest of NFLP
or such Lessee, as applicable, in, to and under any contracts for the sale of
any Exchanged Vehicles and (d) all right, title and interest of NFLP or such
Lessee, as applicable, in, to and under any contracts for the purchase of
Replacement Vehicles; provided that any such Exchange Agreement will not become
effective with respect to Vehicles subject to the Group I Lease until (i)
satisfaction of the Rating Agency Confirmation and Consent Condition with
respect to each Outstanding Series of Group I Notes and (ii) NFLP and such
Lessee shall have received opinions of counsel with respect to perfection,
priority and non-consolidation in substantially the same form as those delivered
on the Series 1999-1 Closing Date.
"Exchange Assignment Agreement" means an agreement with respect to a
Manufacturer and its Manufacturer Program, entered into or to be entered into
among NFLP and/or any Lessee, as assignor, and the Manufacturer, permitting NFLP
and/or such Lessee to assign to the Qualified Intermediary NFLP's and/or such
Lessee's right, title and interest in Exchanged Vehicle Repurchase Rights
arising under such Manufacturer Program, which agreement will (i) not become
effective until satisfaction of the Rating Agency Confirmation and Consent
Condition with respect to each Outstanding Series of Group I Notes and (ii) be
in form and substance reasonably satisfactory to counsel acceptable to the
Trustee.
"Exchange Financing Agreement" means an agreement entered into between
the Qualified Intermediary acting in its capacity as the qualified intermediary
of NFLP or a Lessee and the Exchange Lender pursuant to which the Exchange
Lender agrees to finance the purchase of Replacement Vehicles by the Qualified
Intermediary on behalf of NFLP, which financing is non-recourse to NFLP and the
Qualified Intermediary and is secured by Exchanged Vehicle Repurchase Rights
arising from time to time; provided that any such Exchange Financing Agreement
will not become effective with respect to Vehicles subject to the Group I Lease
until (i) satisfaction of the Rating Agency Confirmation and Consent Condition
with respect to each Outstanding Series of Group I Notes and (ii) NFLP obtains
opinions of counsel with respect to perfection, priority and non-consolidation
in substantially the same form as those delivered as of the Series 1999-1
Closing Date.
"Exchanged Vehicle" means a Designated Vehicle that (a) (i) if subject
to a Manufacturer Program, has been accepted for repurchase by the Manufacturer
under the related Repurchase Program, or (ii) if not subject to a Repurchase
Program, has been sold to a third party, (b) (i) with respect to which NFLP or
any Lessee has received or concurrently receives delivery of one or more
Replacement Vehicles with an aggregate Net Book Value equal to or greater than
the Termination Value of such Designated Vehicles or (ii) with respect to which
the release of the Lien of the Master Collateral Agent thereon would not cause
an Amortization Event or Potential Amortization Event with respect to any Series
of Group I Notes to exist and (c) with respect to which the Lien of the Master
Collateral Agent has been released in accordance with Section 2.7 of the Master
Collateral Agency Agreement.
39
"Exchanged Vehicle Repurchase Rights" means, with respect to each
Exchanged Vehicle that is a Program Vehicle, all right, title and interest of
NFLP or any Lessee in, to and under each Manufacturer Program associated with
such Exchanged Vehicle, to the extent such right, title and interest relate to
such Exchanged Vehicle, including any amendments thereof and all monies due and
to become due in respect of such Exchanged Vehicle under or in connection with
such Manufacturer Program, whether payable as Vehicle repurchase prices, auction
sales proceeds, fees, expenses, costs, indemnities, insurance recoveries,
damages for breach of the Manufacturer Program or otherwise and all rights to
compel performance and otherwise exercise remedies thereunder.
"Excluded Payments" means the following amounts payable to any Lessee
or Lessor (whether payable under the Manufacturer Programs or otherwise): (i)
all incentive payments payable to such Lessee or Lessor to purchase vehicles
(but not any amounts payable to such Lessee or Lessor by a Manufacturer as an
incentive for selling Program Vehicles outside of the related Manufacturer
Program), (ii) all amounts payable to such Lessee or Lessor as compensation for
the preparation by such Lessee or Lessor of newly delivered vehicles and (iii)
all amounts payable to such Lessee or Lessor in reimbursement for warranty work
performed by such Lessee or Lessor on the vehicles.
"Existing Indebtedness" means, with respect to a specified Person,
Indebtedness of such Person issued and outstanding on the date such Person
becomes a party to any Related Document, and any renewals, extensions or
refundings thereof, but not any increases in the principal amounts thereof or
interest rates and fees thereon, except for increases in interest rates upon the
occasion of any such renewal, extension or refunding that are commercially
reasonable at such time.
"Fair Market Value" means, with respect to any Vehicle as of any date
of determination, the wholesale market value of such Vehicle as specified in the
Related Month's published Lease 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; provided, that if the Lease Guide is not
being published or the Lease Guide is being published but such Vehicle is not
included therein, the Finance Guide at the beginning of the model year shall be
used to estimate the wholesale market value of the Vehicle, based on the
Vehicle's model class and model year or the closest model class and model year
thereto and a vehicle condition of "average" (as defined in the Finance Guide);
provided, further, that if the Finance Guide is not being published or the
Finance Guide is being published but such Vehicle is not included therein, the
wholesale market value of such Vehicle shall be based on an independent
third-party data source, and determined in accordance with a methodology, with
respect to which the Rating Agency Confirmation Condition with respect to each
Outstanding Series of Group I Notes shall have been satisfied; provided,
further, that if no such third-party data source or methodology shall have been
so approved or any such third-party source or methodology is not available, the
wholesale market value of such Vehicle shall be the Capitalized Cost of such
Vehicle less depreciation charges at a
40
rate equal to the Republic Historical Depreciation Rate as of such date of the
Capitalized Cost of such Vehicle since the date of such Vehicle's purchase.
"Finance Guide" means the Black Book Official Finance/Lease Guide.
"Financed Vehicle" means an Eligible Vehicle subject to the Financing
Lease.
"Financing Lease" means the Group I Lease as supplemented by Annex B
thereto.
"Fleet Purchase Amount" means, on any date of determination with
respect to (i) the Series 1999-1 Notes, an amount equal to 15% of the aggregate
purchase commitments of all ARG Committed Purchasers on such date, and (ii) any
other Series of Group I Notes, the amount set forth in the applicable
Supplement.
"Fleet Purchase Transaction" means a transaction in which a Lessee
purchases in a single transaction a pool of Eligible Vehicles with respect to
which each of the following is true: (a) the aggregate Net Book Value of the
vehicles in such pool, together with the aggregate Net Book Value (as of the
date of inclusion in an Initial Fleet) of all vehicles leased under the Group I
Lease during the preceding 12 calendar months which were acquired by a Lessee in
a Fleet Purchase Transaction, is less than the aggregate of the Fleet Purchase
Amounts with respect to each Outstanding Series of Group I Notes, (b) all the
vehicles in such pool are titled in the name of the same wholly owned Subsidiary
of Republic, (c) all the certificates of title for the vehicles in such pool
show the same party as lienholder and (d) the named lienholder in respect of
such vehicles is rated at least investment grade by each Rating Agency with
respect to each outstanding Series of Notes.
"Fleet Sharing Agreement" means, with respect to the Group I Lease, an
agreement pursuant to which a Lessee agrees to let a Fleet Sharing Party use
Vehicles leased by such Lessee under the Group I Lease.
"Fleet Sharing Party" means an Eligible Affiliate or Eligible
Franchisee that is using Vehicles pursuant to a Fleet Sharing Agreement.
"GAAP" means those principles of accounting set forth in pronouncements
of the Financial Accounting Standards Board, the American Institute of Certified
Public Accountants or which have other substantial authoritative support and are
applicable in the circumstances as of the date of a report, as such principles
are from time to time supplemented and amended.
"GM Repurchase Program" means the Manufacturer Program titled "General
Motors Corporation Passenger Car and Light Duty Truck 100% Repurchase Program
for Daily Rental Operators - Program No. 99-02," and any substantially similar
Manufacturer Program of GM for any other model years, pursuant to which the
repurchase price for any Program Vehicle subject thereto is calculated based
upon a specified percentage of the Capitalized Cost of such Vehicle
41
and the month of return as set forth in such Manufacturer Program.
"Group I Collateral" is defined in Section 3.1(a) of this Supplement.
"Group I Collection Account" is defined in Section 5.1(a) of this
Supplement.
"Group I Lease" means the Master Motor Vehicle Lease and Servicing
Agreement, dated as of February 26, 1999, among the Lessor, National and the
Additional Lessees, if any, as the lessees thereunder, and Republic, as
guarantor and servicer, as the same may be amended, restated, modified or
supplemented from time to time in accordance with its terms, exclusive of Lease
Annexes.
"Group I Noteholders" means the Holders of the Group I Notes.
"Group I Notes" means, collectively, the Series 1999-1 Notes and any
other Series of Notes issued pursuant to a Supplement which provides that the
NFLP Obligations with respect to such Series are secured by the Group I Lease,
the Vehicles leased thereunder and any other Group I Collateral.
"Group I Percentage" means, with respect to any Series of Group I
Notes, as of any date of determination, a fraction, expressed as a percentage,
the numerator of which is the Invested Amount of such Series of Group I Notes as
of such date and the denominator of which is the Aggregate Group I Invested
Amount as of such date.
"Group I Required Asset Amount" means the sum of the Invested Amounts
and any required overcollateralization with respect to each Outstanding Series
of Group I Notes.
"Guaranteed Depreciation Program" means, with respect to the Series
1999-1 Notes, a guaranteed depreciation program pursuant to which a Manufacturer
has agreed with the Lessor or any Lessee to (a) cause Vehicles manufactured by
it or one of its Affiliates that are turned back during the specified Repurchase
Period to be sold by an auction dealer, (b) cause the proceeds of any such sale
to be paid to the Lessor or such Lessee by such auction dealer after such sale
and (c) pay to the Lessor or such Lessee the excess, if any, of the guaranteed
payment amount with respect to any such Vehicle calculated as of the Turnback
Date in accordance with the provisions of such guaranteed depreciation program
over the amount paid to the Lessor or such Lessee by an auction dealer pursuant
to clause (b) above.
"Guarantor" means Republic, in its capacity as guarantor of each
Lessee's obligations under the Group I Lease.
"Guaranty" is defined in Section 28.1 of the Group I Lease.
"Increase" is defined in Section 4.2(a) of this Supplement.
42
"Ineligible Asset Amount" means, as of any date of determination, an
amount equal to the sum (without duplication) of (a) the aggregate of all
amounts receivable (other than Excluded Payments and amounts receivable in
respect of Exchanged Vehicles) as of such date by any Lessee or the Lessor under
and in accordance with a Manufacturer Program with respect to Program Vehicles
leased under the Group I Lease from a Manufacturer with respect to which a
Manufacturer Event of Default specified in clause (i) or (ii) of the definition
of "Manufacturer Event of Default" has occurred, plus (b) the aggregate of all
Eligible Receivables financed under the Group I Lease or the Indenture owed by a
Manufacturer under and in accordance with a Manufacturer Program with respect to
which a Manufacturer Event of Default specified in clause (i) or (ii) of the
definition of "Manufacturer Event of Default" has occurred, plus (c) the
aggregate of all amounts receivable (other than Excluded Payments and amounts
receivable in respect of Exchanged Vehicles) as of such date by any Lessee or
the Lessor from a Manufacturer under and in accordance with a Manufacturer
Program with respect to Program Vehicles leased under the Group I Lease which
amounts are unpaid more than one hundred (100) days past the applicable Due
Date, plus (d) the aggregate of all Eligible Receivables financed under the
Group I Lease or the Indenture as of such date owed by a Manufacturer under and
in accordance with a Manufacturer Program which amounts are unpaid more than one
hundred (100) days past the applicable Due Date, plus (e) the aggregate of all
amounts specified in clauses (iii) and (iv) of the definition of "Aggregate
Asset Amount" which are unpaid more than 30 days past the applicable disposition
date, plus (f) the aggregate of all amounts specified in clause (v) of the
definition of "Aggregate Asset Amount" which are past due as of such date and in
respect of which any grace period provided for in the applicable Lease for the
making of such payments has expired.
"Initial Determination Date" means, with respect to any Vehicle, the
Determination Date with respect to the Related Month in which the Vehicle Lease
Commencement Date for such Vehicle occurs.
"Initial Fleet" means (a) on the date any Additional Lessee is added
pursuant to Section 29 of the Group I Lease, the Eligible Vehicles titled in the
name of such Additional Lessee prior to the date such party becomes an
Additional Lessee which are refinanced by the Lessor under the Group I Lease
pursuant to the initial Vehicle Order of such Additional Lessee, and (b) on any
other Vehicle Funding Date, the Refinanced Vehicles included in a Fleet Purchase
Transaction.
"Intercreditor Agreement" means the Intercreditor and Subordination
Agreement, dated as of February 26, 1999, by and among Republic, Alamo,
National, Car Temps, certain subordinated creditors listed on Schedule A thereto
from time to time and certain senior creditors listed on Schedule B thereto from
time to time, as the same may be amended, modified or supplemented from time to
time in accordance with its terms.
"Interest Collections" means on any date of determination, all
Collections which, pursuant to the Group I Lease, represent payments of Monthly
Variable Rent or Monthly Finance Rent plus any amounts earned on Permitted
Investments in the Series 1999-1 Collection Account which are available for
distribution on such date.
43
"Issuer's Share" is defined in the ARG Base Indenture.
"Lease Annex" means Annex A or Annex B to the Group I Lease, as the
same may be amended, supplemented, restated or modified from time to time in
accordance with its terms.
"Lease Commencement Date" is defined in Section 3.2 of the Group I
Lease.
"Lease Event of Default" is defined in Section 17.1 of the Group I
Lease.
"Lease Expiration Date" is defined in Section 3.2 of the Group I Lease.
"Lease Guide" means the National Automobile Dealers Association,
Official Used Car Guide, Central Edition.
"Lease Payment Deficit" means, for any Related Month, an amount equal
to the excess, if any, of (a) the aggregate amount of payments required to be
made under the Group I Lease with respect to the Related Month, over (b) the
aggregate amount of payments actually made under the Group I Lease with respect
to the Related Month.
"Lease Payment Rights" means all rights of NFLP to receive payments of
Monthly Base Rent, Additional Base Rent, Monthly Variable Rent, Monthly Finance
Rent, Termination Payments, Casualty Payments and Monthly Supplemental Payments
under the Group I Lease, whether payable by any Lessee or the Guarantor.
"Leasing Company Lease" means, collectively, the Alamo Lease, the Car
Temps Lease and any other vehicle lease to which Republic or an Affiliate of
Republic is a party that together with the Alamo Lease, the Group I Lease and
the Car Temps Lease secures the obligations of an Affiliate Issuer.
"Lessee" means each of National and each Additional Lessee, in its
capacity as a lessee under the Group I Lease, or any successor by merger to any
such Person, in accordance with Section 25.1 of the Group I Lease, or any other
permitted successor or assignee of such Person, in its capacity as a lessee,
pursuant to Section 16 of the Group I Lease.
"Lessee Agreements" means any and all Fleet Sharing Agreements entered
into by any of the Lessees the subject of which includes any Vehicle leased by
the Lessor to any Lessee under the Group I Lease, and any and all other
contracts, agreements, guarantees, insurance, warranties, instruments or
certificates entered into or delivered to the Lessee in connection therewith.
"Lessee Grantor Master Collateral" is defined in the Master Collateral
Agency Agreement.
44
"Lessor" means NFLP, in its capacity as the lessor under the Group I
Lease.
"Liabilities" means all obligations to the Lessor of the Lessees or the
Guarantor arising under or in connection with the Group I Lease, howsoever
created, arising or evidenced, whether direct or indirect, joint or several,
absolute or contingent, or now or hereafter existing, or due or to become due
including, without limitation, interest accruing after the filing of a
bankruptcy petition whether or not allowed as a claim.
"Liquidation Event of Default" means, so long as such event or
condition continues, any of the following: (a) an event specified in Section
9.1(e)(i) of the Base Indenture, (b) an Event of Bankruptcy with respect to
Republic, Alamo, Car Temps, National or any other lessee under a Leasing Company
Lease, (c) an Event of Bankruptcy with respect to Alamo Leasing, Car Temps
Leasing, NFLP, any other lessor under a Leasing Company Lease, the General
Partner, the general partner of Alamo Leasing or of Car Temps Leasing or the
general partner of any other lessor under a Leasing Company Lease or (d) a
payment default under any Leasing Company Lease (after giving effect to any
grace period therefor set forth therein).
"Manufacturer" means a manufacturer or distributor of passenger
automobiles and/or light trucks.
"Manufacturer Event of Default" means, with respect to a Manufacturer,
(i) the failure by such Manufacturer (or if such Manufacturer's Manufacturer
Program is a Guaranteed Depreciation Program, such Manufacturer or any related
auction dealers) to pay any amount due under such Manufacturer's Manufacturer
Program with respect to a Program Vehicle turned in to such Manufacturer and
such failure continues for more than one hundred (100) days following the Due
Date ("Past Due Amounts") and the aggregate Past Due Amounts owing to any of the
Lessees, any other lessee under a Leasing Company Lease, the Lessor or any other
lessor under a Leasing Company Lease from such Manufacturer are equal to or in
excess of the lesser of (x) $25 million and (y) the then outstanding aggregate
amount of repurchase obligations of such Manufacturer under its Manufacturer
Program in respect of Program Vehicles, in each case net of Past Due Amounts,
aggregating no more than $50 million, (A) that are the subject of a good faith
dispute as evidenced in a writing by any of the Lessees, any other lessee under
a Leasing Company Lease, the Lessor or any other lessor under a Leasing Company
Lease, as applicable, or the Manufacturer questioning the accuracy of amounts
paid or payable in respect of certain Program Vehicles tendered for repurchase
under a Manufacturer Program (as distinguished from any dispute relating to the
repudiation by such Manufacturer generally of its obligations under such
Manufacturer Program or the assertion by such Manufacturer of the invalidity or
unenforceability as against it of such Manufacturer Program) and (B) with
respect to which such Lessee, such other lessee, the Lessor or such other lessor
has provided adequate reserves as reasonably determined by such Person, (ii) the
occurrence of an Event of Bankruptcy with respect to such Manufacturer or (iii)
the termination of such Manufacturer's Manufacturer Program or the failure of
such Manufacturer's Repurchase Program or Guaranteed Depreciation Program to
meet the requirements of an Eligible Manufacturer Program.
45
"Manufacturer Payment Rights" means all rights of NFLP under any
Manufacturer Program to receive payments on account of Repurchase Prices of
Program Vehicles.
"Manufacturer Program" means, at any time, any Repurchase Program or
Guaranteed Depreciation Program that is in full force and effect with a
Manufacturer (i) pursuant to which the repurchase price or guaranteed auction
sale price is at least equal to (a) with respect to the GM Repurchase Program, a
specified percentage of the Capitalized Cost of each Vehicle, such percentage
being determined for each Vehicle based upon the model year of such Vehicle and
the calendar month in which such Vehicle is returned to the Manufacturer, minus
Excess Mileage Charges, minus Excess Damage Charges minus other similar charges,
or (b) with respect to any Manufacturer Program other than the GM Repurchase
Program (but including any other Manufacturer Program provided by GM), the
Capitalized Cost of each Vehicle, minus all Depreciation Charges accrued with
respect to such Vehicle prior to the date that the Vehicle is submitted for
repurchase or auction, minus Excess Mileage Charges, minus Excess Damage Charges
minus other similar charges, (ii) that cannot be amended or terminated with
respect to any Vehicle after the purchase of that Vehicle, and (iii) under
which, with respect to Acquired Vehicles and Company Vehicles, Lessor is an
Authorized Fleet Purchaser or, with respect to Financed Vehicles (other than
Company Vehicles), the Lessee thereof is an Authorized Fleet Purchaser and, in
each case, the assignment of the benefits of which to the Master Collateral
Agent has been acknowledged in writing by the related Manufacturer pursuant to
an Assignment Agreement (provided that NFLP may also assign to the Qualified
Intermediary and the Exchange Lender NFLP's rights to Exchanged Vehicle
Repurchase Rights with respect to Exchanged Vehicles), and NFLP, the Master
Collateral Agent and the Trustee have been provided with an officer's
certificate or opinion of counsel reasonably satisfactory to them that NFLP (and
the Master Collateral Agent on behalf of NFLP and the Trustee) can enforce the
applicable Manufacturer's obligations thereunder with respect to Program
Vehicles other than Exchanged Vehicles.
"Manufacturer Receivable" means an amount due from a Manufacturer or
auction dealer under a Manufacturer Program in respect of or in connection with
a Program Vehicle turned back to such Manufacturer.
"Master Collateral Agency Agreement" means the Third Amended and
Restated Master Collateral Agency Agreement, dated as of February 26, 1999,
among NFLP, Alamo Leasing, Car Temps Leasing, National, Alamo and Car Temps, as
grantors, Republic, as master servicer, the various Financing Sources from time
to time parties thereto, the various Beneficiaries from time to time parties
thereto, and the Master Collateral Agent, as further amended, restated, modified
or supplemented from time to time.
"Master Collateral Agent" means Citibank, N.A., in its capacity as
Master Collateral Agent under the Master Collateral Agency Agreement, and any
successor thereto or permitted assign in such capacity thereunder.
46
"Material Adverse Effect" means (A) with respect to any Lessee, Lessor
or Republic, and any occurrence, event or condition with respect to any of them:
(i) a material adverse change in the financial condition, business,
assets or operations of such Lessee, Lessor or Republic, as the case may be, and
its Consolidated Subsidiaries taken as a whole, that materially adversely
affects the ability of such Lessee, Lessor or Republic to perform its respective
obligations under any of the Related Documents; or
(ii) a material adverse effect on the ability of such Lessee, Lessor or
Republic, as the case may be, to perform its material obligations under any of
the Related Documents; and
(B) with respect to the Series 1999-1 Notes, an adverse effect on (a)
the enforceability of the Group I Lease or (b) the priority or perfection of the
Trustee's or the Master Collateral Agents' Lien on a material portion of the
Group I Collateral or Master Collateral applicable thereto, respectively.
"Monthly Base Rent" with respect to the Acquired Vehicles and the
Financed Vehicles, respectively, is defined in the related Lease Annex.
"Monthly Finance Rent" is defined in Section 6 of Annex B of the Group
I Lease.
"Monthly Servicing Fee" is defined in Section 26.1 of the Group I
Lease.
"Monthly Supplemental Payment" is defined in Section 6 of Annex B of
the Group I Lease.
"Monthly Total Principal Allocation" means for any Related Month the
sum of all Series 1999-1 Principal Allocations with respect to such Related
Month.
"Monthly Variable Rent" is defined in Section 9 of Annex A of the Group
I Lease.
"Monthly Vehicle Statement" is defined in Section 24.6 of the Group I
Lease.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means a Pension Plan defined in Section 4001 of
ERISA.
"Multiple Employer Plan" means a Pension Plan maintained by members of
more than one Controlled Group.
"Named Lessee" is defined in Section 8 of the Group I Lease.
"Named Servicer" is defined in Section 26.3 of the Group I Lease.
47
"Net Book Value" means, with respect to any Vehicle being leased under
the Group I Lease (a) as of any date of determination during the period from the
Vehicle Lease Commencement Date for such Vehicle to but excluding the Initial
Determination Date, the Capitalized Cost of such Vehicle, (b) as of the Initial
Determination Date for such Vehicle, (i) the Capitalized Cost for such Vehicle
minus (ii) the aggregate Depreciation Charges accrued with respect to such
Vehicle through the last day of the Related Month in which the Vehicle Lease
Commencement Date for such Vehicle occurred, (c) as of any Determination Date
after the Initial Determination Date, (i) the Net Book Value of such Vehicle as
calculated on the immediately preceding Determination Date minus (ii) the
aggregate Depreciation Charges accrued with respect to such Vehicle during the
Related Month (through the last day thereof), less, (d) if such Vehicle is a
Non-Program Vehicle which was leased under the Financing Lease on the last day
of the Related Month, an amount equal to (i) the amount of Additional Base Rent,
if any, paid (or, prior to the applicable Payment Date, payable) on the Payment
Date immediately following such Related Month divided by (ii) the number of
Non-Program Vehicles leased under the Financing Lease on the last day of the
Related Month. After the Initial Determination Date, on any day which is not a
Determination Date, the Net Book Value of a Vehicle shall be the Net Book Value
calculated for such Vehicle on the most recent Determination Date.
"NFLP Agreements" means the Group I Lease, the Assignment Agreements,
the Base Indenture, as supplemented by this Supplement, the Receivables Trust
Agreement and the Master Collateral Agency Agreement.
"NFLP Obligations" means all principal and interest, at any time and
from time to time, owing by NFLP on the Group I Notes and all costs, fees and
expenses payable by, or obligations of, NFLP under the Base Indenture, the
Series 1999-1 Supplement and the other Related Documents with respect to the
Group I Notes.
"Non-Program Maximum Term" means, with respect to a Non-Program
Vehicle, the earlier of (x) the last day of the forty-second (42nd) month after
the date of the original new dealer invoice for such Non-Program Vehicle and (y)
the last day of the maximum Vehicle Lease term for such Non-Program Vehicle
under the Group I Lease.
"Non-Program Vehicle" means a Vehicle which is not subject to a
Manufacturer Program at the time of its leasing under the Group I Lease or which
is redesignated as a Non-Program Vehicle pursuant to Section 14 of the Group I
Lease.
"Non-Program Vehicle Report" is defined in Section 24.6 of the Group I
Lease.
"Officer's Certificate" means a certificate signed by an Authorized
Officer of the Guarantor, Lessor or the applicable Lessee, as the case may be.
"Operating Lease" means the Group I Lease as supplemented by Annex A
thereto.
48
"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 NFLP
or any Lessee. An Opinion of Counsel may, to the extent same is based on any
factual matter, rely on an Officer's Certificate as to the truth of such factual
matter.
"Payment Date" means the 20th day of each month, or if such date is not
a Business Day, the next succeeding Business Day, commencing March 22, 1999.
"Permitted Encumbrances" means: (a) a Lien securing a tax, assessment
or other governmental charge or levy (excluding any Lien arising under any of
the provisions of ERISA) or the claim of any materialman, mechanic, carrier,
warehouseman or landlord for labor, materials, supplies or rentals incurred in
the ordinary course of business, and foreclosure, distraint, sale or other
similar proceedings shall not have been commenced; (b) a Lien on the properties
and assets of a Subsidiary of any of the Lessees securing Indebtedness owing to
such Lessee; (c) a Lien consisting of a deposit or pledge made, in the ordinary
course of business, in connection with, or to secure payment of, obligations
under worker's compensation, unemployment insurance or similar legislation; (d)
a Lien constituting an encumbrance in the nature of zoning restrictions,
easements, and rights or restrictions of record on the use of real property
which does not materially detract from the value of such property or impair the
use thereof in the business of any Lessee or any Subsidiaries; (e) a Lien
constituting a lease or sublease granted by any Lessee or any Subsidiary to
others in the ordinary course of business; (f) a Lien existing on (i) property
of any Person at the time such Person becomes a Consolidated Subsidiary of any
Lessee or (ii) any asset prior to the acquisition thereof by any of any Lessee
or a Consolidated Subsidiary, but only, in the case of either clause (i) or
(ii), if such Lien was not created in contemplation thereof and so long as the
obligation secured by such Lien is not in default and such Lien is and will
remain confined to the property subject to it at the time such Person becomes a
Consolidated Subsidiary of any Lessee or such property is acquired and to fixed
improvements thereafter erected on such property; (g) a Lien in existence on the
Series 1999-1 Closing Date, but only, in the case of each such Lien, to the
extent it secures Existing Indebtedness; (h) a Lien securing Purchase Money
Indebtedness but only if, in the case of each such Lien: (i) such Lien shall at
all times be confined solely to the asset the purchase price of which was
financed through the incurrence of the Purchase Money Indebtedness secured by
such Lien and to fixed improvements then or thereafter erected on such asset;
(ii) such Lien attached to such asset within 90 days of the acquisition of such
property; and (iii) the aggregate principal amount of Purchase Money
Indebtedness secured by such Lien shall at no time exceed an amount equal to the
lesser of (A) the cost (including the principal amount of such Indebtedness,
whether or not assumed) to any Lessee or a Consolidated Subsidiary of the asset
subject to such Lien and (B) the fair value of such asset at the time of such
acquisition; (i) a Lien constituting a renewal, extension or replacement of a
Lien constituting a Permitted Encumbrance by virtue of clause (f), (g) or (h) of
this definition, but only, in the case of each such renewal, extension or
replacement Lien, to the extent that the principal amount of indebtedness
secured by such Lien does not exceed the principal amount of such indebtedness
so secured at the time of the
49
extension, renewal or replacement, and that such renewal, extension or
replacement Lien is limited to all or a part of the property that was subject to
the Lien extended, renewed or replaced and to fixed improvements then or
thereafter erected on such property; and (j) a Lien arising pursuant to an order
of attachment, distraint or similar legal process arising in connection with
legal proceedings, but only if and so long as the execution or other enforcement
thereof is not unstayed for more than twenty (20) days. For this purpose
"Purchase Money Indebtedness" means Indebtedness of any Lessee or any
Consolidated Subsidiary that, within 90 days of such purchase, is incurred to
finance part or all of (but not more than) the purchase price of a tangible
asset in which neither such Lessee nor any Subsidiary had at any time prior to
such purchase any interest other than a security interest or an interest as
lessee under an operating lease and renewals, extensions or refundings, thereof,
but not any increases in the principal amounts thereof or interest rates
thereon, except for increases in interest rates upon the occasion of any such
renewal, extension or refunding that are commercially reasonable at such time.
"Permitted Investments" means negotiable instruments or securities
maturing on or before the Distribution Date next occurring after the investment
therein, payable in Dollars, issued by an entity organized under the laws of the
United States of America and represented by instruments in bearer or registered
or in book-entry form which evidence (i) obligations the full and timely payment
of which are to be made by or is fully guaranteed by the United States of
America other than financial contracts whose value depends on the values or
indices of asset values; (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
whose short-term debt is rated P-1 by Moody's and A-1 or higher by Standard &
Poor's and subject to supervision and examination by Federal or state banking or
depositary institution authorities; provided, however, that at the earlier of
(x) the time of the investment and (y) the time of the contractual commitment to
invest therein, the certificates of deposit or short-term deposits, if any, or
long-term unsecured debt obligations (other than such obligation whose rating is
based on collateral or on the credit of a Person other than such institution or
trust company) of such depositary institution or trust company shall have a
credit rating from Standard & Poor's of "A-1+", in the case of certificates of
deposit or short-term deposits, or a rating from Standard & Poor's not lower
than "AA", in the case of long-term unsecured debt obligations; (iii) commercial
paper having, at the earlier of (x) the time of the investment and (y) the time
of the contractual commitment to invest therein, a rating from Standard & Poor's
of "A-1+"; (iv) bankers' acceptances issued by any depositary institution or
trust company described in clause (ii) above; (v) investments in money market
funds rated "AAm" by Standard & Poor's or otherwise approved in writing by
Standard & Poor's; (vi) Eurodollar time deposits having a credit rating from
Standard & Poor's of "A-1+"; (vii) repurchase agreements involving any of the
Permitted Investments described in clauses (i) and (vi) above and the
certificates of deposit described in clause (ii) above which are entered into
with a depository institution or trust company, having a commercial paper or
short-term certificate of deposit rating of "A-1+" by Standard & Poor's and P-1
by Moody's or which otherwise is approved as to collateralization by the Rating
Agencies; and (viii) any other instruments or securities, if the Rating Agencies
confirm in writing that the investment in such instruments or securities will
not adversely affect any ratings with respect to
50
any Series of Notes.
"Physical Property" means banker's acceptances, commercial paper,
negotiable certificates of deposits and other obligations that constitute
"instruments" within the meaning of Section 9-105(l)(i) of the applicable UCC
and are susceptible to physical delivery and Certificated Securities.
"Potential Lease Event of Default" means any occurrence or event which,
with the giving of notice, passage of time or both, would constitute a Lease
Event of Default.
"Program Vehicle" means a Vehicle eligible, and subject to, a
Manufacturer Program.
"Qualified Intermediary" means a party, rated not less than A by
Standard & Poor's and A2 by Moody's and designated in an Exchange Agreement as
an intermediary for exchanges of Vehicles by NFLP or any Lessee pursuant to such
Exchange Agreement.
"Rating Agencies" means, with respect to (i) the Series 1999-1 Notes,
Standard & Poor's, Moody's and any other nationally recognized rating agency
rating any series of ARG Notes at the request of ARG or rating any commercial
paper notes issued by a special purpose company at the request of ARG in order
to finance such special purpose company's purchase of any series of ARG Notes
from ARG and (ii) any other Series of Group I Notes, any rating agency or
agencies then issuing a rating for (x) such Series of Group I Notes or any class
thereof, (y) a series of notes issued by an Affiliate Issuer secured by such
outstanding Series of Group I Notes or (z) commercial paper notes issued to fund
the purchase of a series of notes issued by an Affiliate Issuer secured by such
outstanding Series of Group I Notes, in each case, at the request of NFLP or any
Lessee.
"Rating Agency Confirmation and Consent Condition" means with respect
to (i) the Series 1999-1 Notes and any action, that (i) each Rating Agency shall
have notified the Trustee, ARG and the ARG Trustee in writing that such action
will not result in a reduction or withdrawal of the rating of any series of ARG
Notes (without regard to the presence of any insurance policy guaranteeing the
payment of principal of, or interest on, any such series of ARG Notes) or the
rating of any commercial paper notes issued by an ARG Committed Purchaser and
(ii) ARG shall have consented in writing to such action and (ii) any other
Series of Group I Notes, the actions and consents described in the applicable
Supplement.
"Rating Agency Confirmation Condition" means, with respect to (i) the
Series 1999-1 Notes and any action, that each Rating Agency shall have notified
the Trustee, ARG and the ARG Trustee in writing that such action will not result
in a reduction or withdrawal of the rating of any series of ARG Notes (without
regard to the presence of any insurance policy guaranteeing the payment of
principal of, or interest on, any such series of ARG Notes) or the rating of any
commercial paper notes issued by a special purpose company at the request of ARG
in order to finance such special purpose company's purchase of any series of ARG
Notes from ARG and (ii)
51
any other Series of Group I Notes, the actions described in applicable
Supplement.
"Receivables Trust" means the trust created under and pursuant to the
Receivables Trust Agreement.
"Receivables Trust Agreement" means the trust agreement dated as of
February 26, 1999 between NFLP, as grantor, and The Bank of New York (Delaware),
as trustee.
"Receivables Trustee" means The Bank of New York (Delaware), in its
capacity as trustee under the Receivables Trust Agreement.
"Record Date" means, with respect to each Distribution Date, the
Business Day immediately preceding such Distribution Date.
"Refinanced Vehicle Schedule" is defined in Section 2.1(b) of the Group
I Lease.
"Refinanced Vehicles" means Eligible Vehicles (a) owned by Lessor or
any Lessee prior to the Lease Commencement Date under the Group I Lease (i)
which are (A) subject to the lien of the Master Collateral Agent or (B) listed
on Schedule II to the Supplement and a first priority lien on which has been
assigned to the Master Collateral Agent and (ii) are refinanced by Lessor under
the Group I Lease on the Series 1999-1 Closing Date, (b) owned by any Additional
Lessee prior to the Additional Lessee Closing Date with respect to such
Additional Lessee (i) a first priority lien in which has been assigned to the
Master Collateral Agent, and (ii) which are refinanced by Lessor under the
Financing Lease on the Additional Lessee Closing Date with respect to such
Additional Lessee, (c) owned by Lessor or a Lessee and (i) with respect to which
the lien of the Master Collateral Agent is noted on the Certificate of Title and
(ii) which are refinanced by Lessor under the Group I Lease on any date after
the Lease Commencement Date under the Group I Lease or (d) acquired by a Lessee
in a Fleet Purchase Transaction (i) a first priority lien in which has been
assigned to the Master Collateral Agent and (ii) which are refinanced by Lessor
under the Financing Lease.
"Related Documents" means, collectively, the Collateral Agreements, the
Indenture, the Series 1999-1 Notes, any other Series of Group I Notes, any
Enhancement Agreement, any Swap Agreement and any agreements relating to the
issuance or the purchase of any of the Series of Group I Notes or the Group I
Lease.
"Related Month" means, (i) with respect to any Payment Date,
Determination Date or Distribution Date, the most recently ended calendar month
and (ii) with respect to a Series 1999-1 Interest Period, the month in which
such Series 1999-1 Interest Period commences; provided, however, that with
respect to the above clause (i), the initial Related Month shall be the period
from and including the date of issuance of the first Series of Notes to and
including the last day of the calendar month in which such issuance occurs.
52
"Rent", with respect to each Acquired Vehicle and each Financed
Vehicle, is defined in Section 9 of Annex A to the Group I Lease and in Section
6 of Annex B to the Group I Lease, respectively.
"Replacement Vehicle" means an Eligible Vehicle (i) which is owned by
NFLP or any Lessee, (ii) which is in the possession of NFLP or any Lessee, (iii)
with respect to which the Vehicle Perfection and Documentation Requirements have
been satisfied, (iv) which is subject to no Liens other than the Lien of the
Master Collateral Agent and (v) which (a) has been acquired pursuant to an
Exchange Agreement as a Replacement Vehicle for a Designated Vehicle or
Designated Vehicles, (b) (1) has a Net Book Value equal to or greater than the
aggregate Termination Value of the Designated Vehicle or Designated Vehicles
which it replaces or (2) has a Net Book Value when aggregated with the Net Book
Value of one or more other Replacement Vehicles tendered in exchange for a
Designated Vehicle equal to or greater than the Termination Value for such
Designated Vehicle and (c) has been designated on the Servicer's computer system
as a Related Vehicle with respect to the Beneficiary to which the related
Designated Vehicle or Designated Vehicles are designated.
"Republic" means Republic Industries, Inc., a Delaware corporation, and
any successor thereto.
"Republic Historical Depreciation Rate" means, as of any date of
determination, the weighted average Depreciation Charge accruing with respect to
Non-Program Vehicles during the six calendar months preceding such date.
"Repurchase Amount" means, on the Repurchase Date, an amount equal to
the Series 1999-1 Invested Amount, plus (i) all accrued and unpaid interest on
the Series 1999-1 Notes for the period from and including the immediately
preceding Distribution Date to and excluding the Repurchase Date calculated at
the Series 1999-1 Note Rate, (ii) the Series Monthly Servicing Fee with respect
to the Series 1999-1 Notes calculated for the period from and including the
immediately preceding Distribution Date to and excluding the Repurchase Date and
(iii) without duplication, any other Accrued Amounts with respect to the Series
1999-1 Notes then due and payable.
"Repurchase Date" is defined in Section 8.1 of this Supplement.
"Repurchase Price" with respect to any Vehicle (i) subject to a
Repurchase Program means the price paid or payable by the Manufacturer thereof
to repurchase such Vehicle pursuant to its Manufacturer Program and (ii) subject
to a Guaranteed Depreciation Program means the amount which the Manufacturer
thereof guarantees will be paid to any of the Lessees or NFLP as the seller of
such vehicle by such Manufacturer and/or the related auction dealers upon the
disposition of such Vehicle pursuant to its Manufacturer Program.
"Repurchase Program" means a program pursuant to which a Manufacturer
has agreed
53
with a Lessee or NFLP to repurchase Vehicles manufactured by such Manufacturer
or one of its Affiliates during the specified Repurchase Period.
"Required Noteholders" means, with respect to the Series 1999-1 Notes,
the ARG Trustee acting at the direction of the requisite percentage of the ARG
Noteholders in accordance with the ARG Indenture.
"Requisite Investors" means Noteholders holding in excess of 50% of the
aggregate Invested Amount of all outstanding Series of Group I Notes (excluding,
for the purposes of making the foregoing calculation, any Notes held by (i) NFLP
or any Affiliate of NFLP (other than an Affiliate Issuer) or (ii) any Lessee or
any Affiliate of any Lessee (other than an Affiliate Issuer)).
"Revised Article 8" means Revised Article 8 (1994 Version) (and
corresponding amendments to Article 9) as promulgated by the National Conference
of Commissioners on Uniform State Laws.
"Securities Intermediary" means a "securities intermediary" within the
meaning of Section 8-102(a)(14) of Revised Article 8.
"Security Entitlement" means a "security entitlement" within the
meaning of Section 8-102(a)(17) of Revised Article 8.
"Secured Parties" is defined in Section 3.1(a) of this Supplement.
"Series Monthly Servicing Fee" means, on each Payment Date with respect
to any Series of Group I Notes, an amount equal to the product of (a)
one-twelfth of the Servicing Fee Percentage with respect to such Series of Notes
and (b) the Invested Amount of such Series of Notes on the immediately preceding
Payment Date (after giving effect to any payments of principal on such date).
"Series 1996-1 Notes" means the Rental Car Asset Backed Notes, Series
1996-1, issued by NFLP pursuant to the related Supplement.
"Series 1997-2 Notes," "Series 1997-3 Notes" and "Series 1997-4 Notes"
means the Variable Funding Rental Car Note Asset Backed Notes, Series 1997-2,
Series 1997-3 and Series 1997-4, issued by NFLP pursuant to the related
Supplements.
"Series 1999-1 Accrued Interest Account" is defined in Section 5.1(b)
of this Supplement.
"Series 0000-0 Xxxxxxxxx Xxxxx Xxxxxx" means, as of any date of
determination, the product of (a) the Group I Percentage with respect to the
Series 1999-1 Notes as of such date and (b) the Aggregate Asset Amount as of
such date.
54
"Series 1999-1 Closing Date" means February 26, 1999.
"Series 1999-1 Collection Account" is defined in Section 5.1(b) of this
Supplement.
"Series 1999-1 Demand Note" means the demand note made by Republic to
National and assigned by National to NFLP which is payable by Republic upon
NFLP's demand, substantially in the form of Exhibit B.
"Series 1999-1 Deposit Date" is defined in Section 5.2 of this
Supplement.
"Series 1999-1 Enhancement Amount" means, as of any date of
determination, the Series 1999-1 Overcollateralization Amount as of such date.
"Series 1999-1 Enhancement Deficiency" means, on any date of
determination, the amount by which the Series 1999-1 Enhancement Amount is less
than the Series 1999-1 Required Enhancement Amount as of such date.
"Series 1999-1 Excess Collection Account" is defined in Section 5.1(b)
of this Supplement.
"Series 1999-1 Initial Invested Amount" means $1,206,663,350.
"Series 1999-1 Interest Period" means a period commencing on and
including a Distribution Date and ending on and including the day preceding the
next succeeding Distribution Date; provided, however, that the initial Series
1999-1 Interest Period shall commence on and include the Series 1999-1 Closing
Date and end on and include March 21, 1999.
"Series 1999-1 Invested Amount" means, when used with respect to any
date, an amount equal to (a) the Series 1999-1 Initial Invested Amount minus (b)
the amount of principal payments made pursuant to Section 5.4 of this Supplement
to the Series 1999-1 Noteholder on or prior to such date plus (c) any Increases
in the Series 1999-1 Invested Amount pursuant to Section 4.2 of this Supplement
on or prior to such date.
"Series 1999-1 Invested Percentage" means on any date of determination:
(a) when used with respect to Principal Collections, the
percentage equivalent (which percentage shall never exceed 100%) of a
fraction the numerator of which shall be equal to the sum of the Series
1999-1 Invested Amount and the Series 1999-1 Overcollateralization
Amount, determined during the Series 1999-1 Revolving Period at the
close of business on the immediately preceding Business Day, or, during
the Series 1999-1 Rapid Amortization Period, at the close of business
on the last day of the Series 1999-1 Revolving Period, and the
denominator of which shall be the greater of (I) the
55
Aggregate Asset Amount determined during the Series 1999-1 Revolving
Period as of such date of determination or, during the Series 1999-1
Rapid Amortization Period, at the close of business on the last day of
the Series 1999-1 Revolving Period, and (II) as of the same date as in
clause (I), the sum of the numerators used to determine invested
percentages for allocations with respect to Principal Collections (for
all Series of Group I Notes and all classes of such Series of Group I
Notes); and
(b) when used with respect to Interest Collections, the
percentage equivalent (which percentage shall never exceed 100%) of a
fraction the numerator of which shall be the Accrued Amounts with
respect to the Series 1999-1 Notes on such date of determination, and
the denominator of which shall be the aggregate Accrued Amounts with
respect to all Series of Group I Notes on such date of determination.
"Series 1999-1 Limited Liquidation Event of Default" means, so long as
such event or condition continues, any Series 1999-1 Affiliate Issuer
Liquidation Event or any event or condition of the type specified in clause (a),
(b), (c) or (d) of Article 7 of this Supplement that continues for thirty (30)
days (without double counting the cure period, if any, provided therein);
provided however, that any Series 1999-1 Affiliate Issuer Liquidation Event or
event or condition of the type specified in clause (a), (b), (c) or (d) of
Section 7.1 of this Supplement shall not constitute a Series 1999-1 Limited
Liquidation Event of Default if within such thirty (30) day period, such Series
1999-1 Affiliate Issuer Liquidation Event, Series 1999-1 Enhancement Deficiency
or payment default, as the case may be, shall have been cured, and, after such
cure is provided for, the Rating Agency Confirmation Condition with respect to
the Series 1999-1 Notes shall have been satisfied with respect to such cure.
"Series 1999-1 Maximum Invested Amount" means $2,000,000,000, as such
amount may be increased or reduced from time to time pursuant to a written
agreement between NFLP and ARG.
"Series 1999-1 Noteholder" means ARG, as registered holder of the
Series 1999-1 Notes.
"Series 1999-1 Note Rate" means, with respect to any Series 1999-1
Interest Period, the interest rate equal to the sum of (a) 1/12 of the
Additional Spread Percentage as of the first day of such Series 1999-1 Interest
Period and (b) the percentage equivalent of a fraction, the numerator of which
is equal to (i) the sum of (x) the product of (A) the sum of (1) the aggregate
amount of interest payable by ARG on the ARG Notes in respect of such Series
1999-1 Interest Period on the next succeeding Distribution Date (excluding any
amounts previously paid pursuant to Section 5.3(c) of this Supplement), (2) all
unpaid fees, costs, expenses and indemnities payable by ARG on or prior to such
Distribution Date pursuant to the ARG Indenture and any of the other ARG
Agreements (including any amounts payable by ARG to any Person providing credit
enhancement for any ARG Notes), (3) all unreimbursed out-of-pocket costs and
expenses (including reasonable attorneys' fees and legal expenses) incurred by
ARG in connection with the administration, enforcement, waiver or amendment of
the ARG Indenture and any of the
56
other ARG Agreements on or prior to such Distribution Date and (4) all other
operating expenses of ARG (including any management fees) and (B) the Issuer's
Share as of the first day of such Series 1999-1 Interest Period and (y) all
unreimbursed out-of-pocket costs and expenses (including reasonable attorneys'
fees and legal expenses) incurred by ARG in connection with the administration,
enforcement, waiver or amendment of any Related Document prior to such
Distribution Date and (ii) the denominator of which is equal to the average
daily Series 1999-1 Invested Amount during such Series 1999-1 Interest Period;
provided, however, that the Series 1999-1 Note Rate will in no event be higher
than the maximum rate permitted by applicable law.
"Series 1999-1 Notes" means any one of the Series 1999-1 Variable
Funding Rental Car Asset Backed Notes, executed by NFLP and authenticated and
delivered by or on behalf of the Trustee, substantially in the form of Exhibit
A.
"Series 1999-1 Overcollateralization Amount" means, as of any date of
determination, the excess, if any, of the Series 0000-0 Xxxxxxxxx Asset Amount
over the Series 1999-1 Invested Amount as of such date.
"Series 1999-1 Principal Allocation" is defined in Section 5.2(a)(ii)
of this Supplement.
"Series 1999-1 Rapid Amortization Period" means the period beginning at
the close of business on the Business Day immediately preceding the day on which
a Termination Event is deemed to have occurred and ending upon the earliest to
occur of (i) the date on which the Series 1999-1 Notes are fully paid, (ii) the
Series 1999-1 Termination Date and (iii) the termination of the Indenture.
"Series 1999-1 Required Enhancement Amount" means, as of any date of
determination, the Series 1999-1 Required Overcollateralization Amount on such
date.
"Series 1999-1 Required Overcollateralization Amount" means, as of any
date of determination, the product of (x)0.50% and (y) the Series 1999-1
Invested Amount as of such date.
"Series 1999-1 Revolving Period" means the period from and including
the Series 1999-1 Closing Date to the commencement of the Series 1999-1 Rapid
Amortization Period.
"Series 1999-1 Servicing Fee Percentage" means 0.50% per annum.
"Series 1999-1 Termination Date" means the first Distribution Date that
is 60 or more months after the ARG Revolving Period Termination Date.
"Servicer" means Republic, in its capacity as servicer of Vehicles
under the Group I Lease and as master servicer under the Master Collateral
Agency Agreement, unless the Master Collateral Agent shall have assumed any
duties and obligations of the Servicer pursuant to the applicable provisions of
the Master Collateral Agency Agreement, and thereafter "Servicer"
57
shall, to such extent, include the Master Collateral Agent.
"Subordinated Note" means the subordinated note made by Republic to
National and assigned to NFLP which is payable by Republic upon NFLP's demand.
"Sub-Servicer" is defined in Section 26.3 of the Group I Lease.
"Supplement" is defined in the preamble.
"Supplemental Documents" is defined in Section 2.1(c) of the Group I
Lease.
"Term" is defined in Section 3.2 of the Group I Lease.
"Termination Event" means the earlier to occur of (a) the day on which
an Amortization Event is deemed to have occurred with respect to the Series
1999-1 Notes and (b) the ARG Revolving Period Termination Date.
"Termination Payment" is defined in Section 12.3(b) of the Group I
Lease.
"Termination Value" means, with respect to any Vehicle, as of any date,
an amount equal to (i) the Capitalized Cost of such Vehicle, minus (ii) unless
otherwise deducted in the calculation of "Capitalized Cost", all Depreciation
Charges for such vehicle accrued prior to such date.
"Turnback Date" means, with respect to any Program Vehicle, the date on
which such Vehicle is accepted for return by a Manufacturer or its agent
pursuant to its Manufacturer Program and the Depreciation Charges cease to
accrue pursuant to its Manufacturer Program.
"Uncertificated Security" means an "uncertificated security" within the
meaning of the applicable UCC.
"United States Security Entitlement" means a "Security Entitlement" as
defined in 31 C.F.R. Section 357.2, 24 C.F.R. Section 1.2, 12 C.F.R. Section
912.1, 12 C.F.R. Section 1511.1, 12 C.F.R. Section 615.5450 or 31 C.F.R. Section
354.1.
"Used Vehicle" is defined in Section 2.1(e) of the Group I Lease.
"Used Vehicle Transaction" is defined in Section 2.1(e) of the Group I
Lease.
"Vehicle" means a passenger automobile or light truck purchased,
financed or refinanced by NFLP under the Group I Lease and pledged under the
Master Collateral Agency Agreement for the benefit of the Trustee (on behalf of
the Group I Noteholders), but solely during the Vehicle Term for such Vehicle.
58
"Vehicle Assignment and Nominee Agreement" means, with respect to any
Vehicles in an Initial Fleet leased by a Lessee, the vehicle assignment and
nominee agreement among such Lessee, the Master Collateral Agent and the other
parties thereto, pursuant to which the then existing liens in such Vehicles are
assigned to the Master Collateral Agent.
"Vehicle Funding Date" is defined in Section 3.1 of the Group I Lease.
"Vehicle Lease Commencement Date" is defined in Section 3.1 of the
Group I Lease.
"Vehicle Lease Expiration Date" with respect to each Vehicle, means the
earliest of (i) the Disposition Date for such Vehicle, (ii) if such Vehicle
becomes a Casualty or ceases to be an Eligible Vehicle, 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 the Lessee thereof in accordance with the
Group I Lease, and (iii) the last day of 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 Group I Lease.
"Vehicle Order" is defined in Section 2.1(c) of the Group I Lease.
"Vehicle Perfection and Documentation Requirements" means, (i) with
respect to a Vehicle (other than, to the extent permitted under the Group I
Lease, Vehicles in an Initial Fleet), submission within the applicable statutory
period of an application for the issuance of a certificate of title for such
Vehicle with the department of registry of motor vehicles of the applicable
state in which such Vehicle is to be registered, which application shall reflect
the following: Lessor or any Lessee, as the registered owner and the Master
Collateral Agent as the first lienholder or (ii) in the case of such Vehicles in
such Initial Fleet, the assignment to the Master Collateral Agent of the
lienholder's lien with respect to such Vehicles in such Initial Fleet.
"Vehicle Purchase Price" means, on any date of determination and for
any Acquired Vehicle, an amount equal to the greater of (a) the sum of the
applicable Net Book Value of the Vehicle and all unpaid Depreciation Charges
accruing with respect thereto through the last day of the Related Month to the
date of purchase by any of the Lessees, and (b) the Fair Market Value of such
Vehicle.
"Vehicle Term" is defined in Section 3.1 of the Group I Lease.
"VFR" means, for any period, an interest rate equal to the quotient
(expressed as a percentage) of (i) the amount of interest accrued during such
period with respect to all Series of Group I Notes, divided by (ii) the average
daily aggregate Invested Amounts of all Series of Group I Notes during such
period.
59
"VIN" means vehicle identification number.
60
TABLE OF CONTENTS
Page
PRELIMINARY STATEMENT .............................................................. 1
ARTICLE 1
DESIGNATION ........................................................................ 1
ARTICLE 2
DEFINITIONS ........................................................................ 2
Section 2.1 Definitions ....................................................... 2
Section 2.2 Cross References .................................................. 3
ARTICLE 3
SECURITY ........................................................................... 3
Section 3.1 Grant of Security Interest ........................................ 3
ARTICLE 4
INITIAL ISSUANCE AND INCREASES AND DECREASES OF SERIES 1999-1 INVESTED AMOUNT OF
SERIES 1999-1 NOTES ................................................................ 5
Section 4.1 Issuance in Definitive Form ....................................... 5
Section 4.2 Procedure for Increasing the Invested Amount ...................... 5
Section 4.3 Procedure for Decreasing the Series 1999-1 Invested Amount ........ 7
ARTICLE 5
SERIES 1999-1 ALLOCATIONS .......................................................... 8
Section 5.1 Establishment of Group I Collection Account and Subaccounts
Thereof; Collections ..................................................... 8
Section 5.2 Allocations with Respect to the Series 1999-1 Notes .............. 10
Section 5.3. Payments To Series 1999-1 Noteholder ............................. 12
Section 5.4. Payment of Note Principal ........................................ 14
Section 5.5. The Servicer's Failure to Instruct the Trustee to Make a
Deposit or Payment ....................................................... 14
Section 5.6. Payments by Wire Transfer ........................................ 15
Section 6.1. Waiver of Certain Provisions of Base Indenture ................... 15
Section 6.2. Information ...................................................... 15
Section 6.3. Manufacturer Programs ............................................ 16
Section 6.4. True Lease Opinion ............................................... 17
ARTICLE 7
AMORTIZATION EVENTS ................................................................ 17
Section 7.1. Amortization Events .............................................. 17
Section 7.2. Rights of the Trustee upon Amortization Event or Certain Other
Events of Default ........................................................ 18
Section 7.3. Rights of the Trustee upon Affiliate Issuer Liquidation Event .... 19
61
Page
----
ARTICLE 8
GENERAL ............................................................................ 20
Section 8.1. Optional Repurchase ............................................. 20
Section 8.2. Information ..................................................... 20
Section 8.3. Exhibits ........................................................ 20
Section 8.4. Ratification of Base Indenture .................................. 20
Section 8.5. Counterparts .................................................... 20
Section 8.6. Governing Law ................................................... 20
Section 8.7. Amendments ...................................................... 20
Section 8.8. Notice to Rating Agencies ....................................... 21
Section 8.9. Series 1999-1 Demand Note ....................................... 21
Section 8.10. Subordinated Note ............................................... 21
Section 8.11. Additional Series of Group I Notes .............................. 21
Section 8.12. Year 2000 ....................................................... 21
62
ANNEX A - Definitions List
EXHIBIT A - Form of Series 1999-1 Note
EXHIBIT B - Form of Series 1999-1 Demand Note
