1
EXHIBIT 4.17
[EXECUTION COPY]
================================================================================
COLLATERAL AGREEMENT
dated as of March 4, 1998
among
DOLLAR THRIFTY FUNDING CORP.,
CREDIT SUISSE FIRST BOSTON,
as Liquidity Agent and Series 1998-1 Letter of Credit Provider
CREDIT SUISSE FIRST BOSTON CORPORATION,
as a Dealer,
and
BANKERS TRUST COMPANY,
as Depositary and as Collateral Agent
================================================================================
2
TABLE OF CONTENTS
Page
ARTICLE I.
DEFINITIONS
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE II.
OBLIGATIONS COLLATERALIZED
SECTION 2.01. Obligations Collateralized Hereby . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE III.
AGENTS; REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 3.01. DTFC and Other Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3.02. Representations and Warranties of DTFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 3.03. Additional Representations, Warranties and Covenants of DTFC . . . . . . . . . . . . . . . . . . . . . 6
SECTION 3.04. Representations and Warranties of the Collateral Agent . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE IV.
ASSIGNMENT
SECTION 4.01. Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 4.02. Application of Assigned Collateral and Deposited Funds . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 4.03. Performance of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 4.04. Amendments; Waivers; Declaration of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4.05. Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
-i-
3
ARTICLE V.
COLLATERAL ACCOUNT, LIQUIDITY LENDER ACCOUNT,AND CREDIT ENHANCER ACCOUNT
SECTION 5.01. Establishment of Collateral Account, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 5.02. Assignment of Accounts, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 5.03. Application of Deposited Funds and Assigned Collateral . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 5.04. Eligible Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 5.05. Liquidity Demand; Commitment Termination Demand . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE VI.
DEFAULT
SECTION 6.01. Rights of the Collateral Agent upon Liquidity Agreement Amortization Event and
Liquidation Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE VII.
THE COLLATERAL AGENT, THE LIQUIDITY LENDERS,AND THE HOLDERS OF COMMERCIAL PAPER NOTES
SECTION 7.01. Appointment and Powers of Collateral Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 7.02. Collateral Agents and Employees of the Collateral Agent . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 7.03. Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 7.04. Successor Collateral Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 7.05. Qualifications of Collateral Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 7.06. Instructions of the Required Liquidity Providers and Other Parties . . . . . . . . . . . . . . . . . 27
ARTICLE VIII.
AMENDMENTS, MODIFICATIONS, WAIVERS AND CONSENTS
SECTION 8.01. Execution of Amendments, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
-ii-
4
ARTICLE IX.
MISCELLANEOUS
SECTION 9.01. Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 9.02. No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 9.03. Notice of Amendments; Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.04. Notices, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.05. Fee; Costs and Expenses, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 9.06. Collateral Agent Appointed Attorney-in-Fact . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 9.07. Termination; Assigned Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 9.08. Governing Law; Binding Character; Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 9.09. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 9.10. No Bankruptcy Petition Against DTFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 9.11. No Recourse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 9.12. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 9.13. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 9.14. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 9.15. Limited Recourse to DTFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 9.16. Waiver of Set-Off With Respect to DTFC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 9.17. Obligations of Collateral Agent Under the Note Purchase Agreement . . . . . . . . . . . . . . . . . 36
EXHIBIT A - FEE LETTER
-iii-
5
COLLATERAL AGREEMENT
THIS COLLATERAL AGREEMENT (this "Collateral Agreement"), dated as of
March 4, 1998, is entered into among DOLLAR THRIFTY FUNDING CORP., an Oklahoma
corporation ("DTFC"), CREDIT SUISSE FIRST BOSTON CORPORATION, a Massachusetts
corporation ("CSFB" and, together with Chase Securities, Inc., a Delaware
corporation, in its capacity as a dealer and any other dealers for Commercial
Paper Notes engaged by DTFC from time to time that agree to become parties to
this Collateral Agreement and the Dealer Agreement, the "Dealers") as a dealer
under the Dealer Agreement, CREDIT SUISSE FIRST BOSTON, a Swiss banking
corporation, as liquidity agent (the "Liquidity Agent") for the banks party to
the Liquidity Agreement (the "Liquidity Lenders"), acting on its own behalf as
credit enhancer (in such capacity, the "Series 1998-1 Letter of Credit
Provider") and BANKERS TRUST COMPANY, a New York banking corporation, as
depositary (the "Depositary") under the Depositary Agreement and acting on its
own behalf and on behalf of the Holders of Commercial Paper Notes, the
Liquidity Lenders, the Liquidity Agent and the Dealers, as collateral agent (in
such capacity, the "Collateral Agent") .
BACKGROUND
1. DTFC proposes to issue and sell its promissory notes (the
"Commercial Paper Notes") in the commercial paper market and proposes to obtain
the Liquidity Commitments (such capitalized term, together with all other
capitalized terms used herein, shall have the meaning assigned thereto in
Section 1.01 hereof) of the Liquidity Lenders, to make Liquidity Advances to
DTFC.
2. Contemporaneously with the execution and delivery of this
Collateral Agreement, Rental Car Finance Corp., an Oklahoma corporation
("RCFC"), and Bankers Trust Company, a New York banking corporation, as Trustee
(in such capacity, the "Trustee"), are entering into the Series 1998-1
Supplement, dated as of even date herewith (as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof, the "Series 1998-1 Supplement") to the Base Indenture dated as
of December 13, 1995, as amended (as the same may be amended, supplemented or
otherwise modified from time to time in accordance with the terms thereof, the
"Base Indenture"), among RCFC and the Trustee, pursuant to which RCFC will
issue the Variable Funding Rental Car Asset Backed Notes, Series 1998-1 (the
"Series 1998-1 Notes").
3. Contemporaneously with the execution and delivery of this
Collateral Agreement, RCFC, DTAG and DTFC, as Note Purchaser, are entering into
the Note Purchase Agreement dated as of even date herewith (as the same may be
amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Note Purchase Agreement"), pursuant to which DTFC
will purchase the Series 1998-1 Notes and make loans
6
from time to time to RCFC, the proceeds of which will be used to purchase and
finance Vehicles for leasing under the terms of the Master Motor Vehicle Lease
and Servicing Agreement (the "Master Lease") among RCFC, as lessor, Thrifty
Rent-A-Car System, Inc., an Oklahoma corporation ("Thrifty"), as lessee and
servicer, Dollar Rent A Car Systems, Inc., an Oklahoma corporation ("Dollar")
as lessee and servicer, Dollar Thrifty Automotive Group, Inc., a Delaware
corporation ("DTAG"), as guarantor and master servicer, and those Subsidiaries
of DTAG from time to time becoming lessees and servicers thereunder (Thrifty,
Dollar, and such Subsidiaries, collectively the "Lessees").
4. Contemporaneously with the execution and delivery of this
Collateral Agreement, DTFC, the Liquidity Agent and the Liquidity Lenders are
entering into the Liquidity Agreement dated as of even date herewith (as it may
be amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Liquidity Agreement"), providing for, among other
things, the Liquidity Commitments of the Liquidity Lenders to make Liquidity
Advances on behalf of DTFC from time to time.
5. Contemporaneously with the execution and delivery of this
Collateral Agreement, DTFC, DTAG, Credit Suisse First Boston Corporation and
Chase Securities Inc. are entering into the Dealer Agreement dated as of even
date herewith (as it may be amended, supplemented or otherwise modified from
time to time in accordance with the terms thereof, the "Dealer Agreement"),
providing for, among other things, each Dealer to act as a commercial paper
dealer for the Commercial Paper Notes.
6. Contemporaneously with the execution and delivery of this
Collateral Agreement, DTFC, Dollar, Thrifty, RCFC, DTAG and the Series 1998-1
Letter of Credit Provider are entering into a CP Enhancement Letter of Credit
Application and Agreement (the "CP Enhancement Letter of Credit Application and
Agreement") pursuant to which the Series 1998-1 Letter of Credit Provider will
issue the Series 1998-1 Letter of Credit as partial credit support for the
Lessees' payment obligations under the Master Lease and as liquidity support
for maturing Commercial Paper Notes.
7. Contemporaneously with the execution and delivery of this
Collateral Agreement, DTFC and the Depositary are entering into the Depositary
Agreement dated as of even date herewith (as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof, the "Depositary Agreement") providing for the issuance of the
Commercial Paper Notes.
8. Contemporaneously with the execution and delivery of this
Collateral Agreement, RCFC, DTAG, and the Lessees are entering into the Master
Lease.
9. DTFC is entering into this Collateral Agreement with the
Liquidity Agent, the Series 1998-1 Letter of Credit Provider, the Depositary,
the Collateral Agent and CSFB in its
-2-
7
capacity as a Dealer for the purpose of, among other things, providing for the
repayment or payment of all amounts at any time and from time to time owing by
DTFC to the Liquidity Lenders or the Liquidity Agent under or in connection
with the Liquidity Agreement or this Collateral Agreement and all amounts owing
at any time and from time to time by DTFC to the Series 1998-1 Letter of Credit
Provider under or in connection with the Series 1998-1 Letter of Credit or this
Collateral Agreement or owing by DTFC to the Holders of the Commercial Paper
Notes or the Depositary or owing to the Collateral Agent hereunder or owing to
the Dealers under the Dealer Agreement.
NOW, THEREFORE, in consideration of the premises and agreements herein
contained, each of DTFC, the Liquidity Agent, the Depositary, the Collateral
Agent and CSFB, in its capacity as a Dealer, agree as follows:
ARTICLE I.
DEFINITIONS
SECTION 1.01. Definitions. As used in this Collateral
Agreement and unless the context requires a different meaning, capitalized
terms not otherwise defined herein shall have the meanings assigned to such
terms in (i) the Definitions List (the "Definitions List to the Liquidity
Agreement"), attached as Annex A to the Liquidity Agreement, as such
Definitions List to the Liquidity Agreement may be amended, supplemented or
otherwise modified in accordance with the Liquidity Agreement, (ii) the Series
1998-1 Supplement, and (iii) the Definitions List (the "Definitions List to the
Base Indenture") attached as Schedule 1 to the Base Indenture as in effect as
of the date hereof (as such Definitions List to the Base Indenture may be
amended, amended and restated, supplemented or otherwise modified from time to
time in accordance with the terms thereof).
ARTICLE II.
OBLIGATIONS COLLATERALIZED
SECTION 2.01. Obligations Collateralized Hereby. This
Collateral Agreement is made to provide for repayment and payment of the
Indebtedness and liabilities of DTFC (such Indebtedness and liabilities being
herein called the "DTFC Obligations") set forth below. Upon the occurrence,
and during the continuance, of a Liquidity Agreement Amortization Event, the
DTFC Obligations will be paid in the order of priority indicated below:
First, the repayment, pro rata, of (i) all amounts advanced or
expended by the Collateral Agent, in its capacity as Collateral Agent,
for the account of DTFC
-3-
8
hereunder, and the payment of all reasonable out-of-pocket costs, fees
and expenses at any time and from time to time payable hereunder to
the Collateral Agent, in its capacity as such, in connection with the
administration or enforcement of this Collateral Agreement or any CP
Program Document (including, without limitation, the reasonable fees
and out-of-pocket expenses of counsel employed by the Collateral Agent
in connection therewith) and the payment of all indemnities at any
time and from time to time due by DTFC hereunder to the Collateral
Agent in its capacity as such up to an aggregate amount equal to
$75,000 per annum, and (ii) all fees and expenses at any time and from
time to time due to the Depositary pursuant to Section 8(a) of the
Depositary Agreement up to an aggregate amount equal to $50,000 per
annum;
Second, subject to the last sentence of Section 5.02(f), the
payment of all Indebtedness, at any time and from time to time, due
from DTFC on the Outstanding Commercial Paper Notes issued pursuant to
and in accordance with the Depositary Agreement;
Third, the payment of all operating and ordinary course
expenses of DTFC up to an aggregate amount equal to $100,000 per
annum;
Fourth, the payment of all amounts at any time and from time
to time due to the Liquidity Agent as notified to the Collateral Agent
pursuant to Section 3.6.5 of the Liquidity Agreement;
Fifth, the payment, pro rata, of all principal Indebtedness
(including Commitment Termination Date Liquidity Advances), at any
time and from time to time, due (in the case of a Commitment
Termination Date Liquidity Advance, such Advance will be deemed to be
due for purposes of this clause Fifth on the date such Advance is
made) from DTFC (a) to the Liquidity Lenders in connection with the
Liquidity Advances made pursuant to the Liquidity Agreement, and (b)
to the Series 1998-1 Letter of Credit Provider (or, if applicable, to
the Series 1998-1 Cash Collateral Account) in connection with moneys
drawn under the Series 1998-1 Letter of Credit (or, if applicable,
withdrawn from the Series 1998-1 Cash Collateral Account) to fund any
LOC Liquidity Disbursements, together with all amounts payable in
respect of interest on any of the foregoing;
Sixth, the payment, pro rata, of all other Indebtedness
(including, but not limited to fees, reimbursements, funding
indemnities, taxes and increased costs, but excluding amounts
referenced in clause Eighth below), at any time and from time to time,
due to the Liquidity Lenders, the Liquidity Agent and the Series
1998-1 Letter of Credit Provider (solely with respect to amounts due
from DTFC under the CP Enhancement Letter of Credit Application and
Agreement), pro rata, the payment of any other amounts (excluding
those referenced in clause Eighth below) at any time and
-4-
9
from time to time due from DTFC to any of them under or in respect of
the Liquidity Agreement, the Series 1998- 1 Letter of Credit or the CP
Enhancement Letter of Credit Application and Agreement, as the case
may be, together with all amounts due from DTFC in respect of interest
thereon, and the payment, pro rata, of all indemnities at any time and
from time to time due from DTFC hereunder to the Liquidity Lenders and
the Series 1998-1 Letter of Credit Provider, it being understood that
amounts payable under this clause Sixth shall relate exclusively to
costs and expenses incurred in or in connection with the procurement
and handling of funds and the making of such funds available to or for
the account or benefit of DTFC and shall not include amounts payable
in connection with general indemnity claims relating to the use by
DTFC or the Series 1998-1 Letter of Credit Provider of the proceeds of
such financial accommodations (other than, in the event such actions
give rise to breakage costs, any action in the nature of a prepayment
by DTFC) or actions taken or omitted to be taken by DTFC under the CP
Program Documents and not directly related to the procurement of
funds, all of which shall be covered by clause Eighth below;
Seventh, the repayment of reasonable amounts owing to the
Collateral Agent and the Depositary referred to in clause First above
in excess of $75,000 per annum with respect to the Collateral Agent
and in excess of $50,000 with respect to the Depositary;
Eighth, the repayment, pro rata, of all reasonable amounts
advanced or expended by any Liquidity Lender or the Series 1998-1
Letter of Credit Provider under this Collateral Agreement, as the case
may be, and any other amounts and reasonable out-of-pocket costs and
expenses due from DTFC to any party under or in connection with the
Liquidity Agreement, the Series 1998-1 Letter of Credit, the CP
Enhancement Letter of Credit Application and Agreement, the Depositary
Agreement, the Dealer Agreement or any other CP Program Document,
whether in respect of indemnities thereunder or otherwise; and
Ninth, the payment of all other expenses of DTFC referred to
in clause Third above in excess of $100,000 per annum.
ARTICLE III.
AGENTS; REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 3.01. DTFC and Other Agents. (a) With the delivery
of this Collateral Agreement, DTFC is furnishing to the Collateral Agent, and
from time to time thereafter may furnish to the Collateral Agent, a certificate
upon which it may conclusively rely (the "DTFC Incumbency Certificate")
certifying the incumbency and specimen signatures of officers,
-5-
10
employees, agents or representatives of DTFC (the "DTFC Agents") authorized to
act, and to give instructions and notices, on behalf of DTFC hereunder. Until
the Collateral Agent receives a subsequent DTFC Incumbency Certificate, the
Collateral Agent shall be entitled to rely on the last such DTFC Incumbency
Certificate delivered to it for purposes of determining the authorized DTFC
Agents.
(b) With the delivery of this Collateral Agreement, the Depositary
is furnishing to the Collateral Agent, and from time to time thereafter may
furnish to the Collateral Agent, a certificate (the "Depositary Incumbency
Certificate") certifying as to the incumbency and specimen signatures of
officers of the Depositary (the "Depositary Agents") authorized to act, and to
give instructions and notices, on behalf of the Depositary hereunder. Until
the Collateral Agent receives a subsequent Depositary Incumbency Certificate,
the Collateral Agent shall be entitled to rely on the last such Depositary
Incumbency Certificate delivered to it for purposes of determining the
authorized Depositary Agents. Notwithstanding anything in this Section 3.01(b)
to the contrary, for so long as the Collateral Agent is also the Depositary,
the Depositary shall not be required to furnish a Depositary Incumbency
Certificate to the Collateral Agent pursuant to this Section 3.01(b).
(c) With the delivery of this Collateral Agreement and from time
to time thereafter, the Liquidity Agent shall furnish to the Collateral Agent a
certificate upon which it may conclusively rely (the "Liquidity Agent
Incumbency Certificate") certifying as to the incumbency and specimen
signatures of officers of the Liquidity Agent (the "L.A. Agents") authorized
to act, and to give instructions and notices, on behalf of the Liquidity Agent
hereunder. Until the Collateral Agent receives a subsequent Liquidity Agent
Incumbency Certificate, the Collateral Agent shall be entitled to rely on the
last such Liquidity Agent Incumbency Certificate delivered to it for purposes
of determining the authorized L.A. Agents.
SECTION 3.02. Representations and Warranties of DTFC. DTFC
reaffirms and repeats its representations and warranties contained in the
Liquidity Agreement and the CP Enhancement Letter of Credit Application and
Agreement and agrees that the Secured Parties may rely on such representations
and warranties as though set forth herein in full.
SECTION 3.03. Additional Representations, Warranties and
Covenants of DTFC. DTFC hereby makes the following representations, warranties
and covenants to the Collateral Agent, the Depositary, the Liquidity Agent, the
Holders of the Commercial Paper Notes, the Liquidity Lenders and the Dealers:
(a) All action necessary (including the filing of UCC-1
financing statements, the delivery of the Series 1998-1 Notes to the
Collateral Agent) to protect and perfect the Collateral Agent's
security interest on behalf of the Secured Parties in the Assigned
Collateral (as defined in Section 4.01) now in existence and hereafter
acquired or created and the Deposited Funds has been duly and
effectively taken.
-6-
11
(b) No security agreement, financing statement,
equivalent security or lien instrument or continuation statement
listing DTFC as debtor covering all or any part of the Assigned
Collateral is on file or of record in any jurisdiction, except such as
may have been filed, recorded or made by DTFC in favor of the
Collateral Agent pursuant to this Collateral Agreement.
(c) This Collateral Agreement creates a valid and
continuing Lien on the Assigned Collateral in favor of the Collateral
Agent on behalf of the Secured Parties, which Lien is prior to all
other Liens, except for Permitted Liens, and is enforceable as such as
against creditors of and purchasers from DTFC. All action necessary
or desirable to protect and perfect such prior security interest has
been duly taken.
(d) DTFC's principal place of business and chief
executive office shall be at: 5330 East 31st Street, Tulsa, Oklahoma
74135 and the place where its records concerning the Assigned
Collateral are kept is at 5330 East 31st Street, Tulsa, Oklahoma
74135. DTFC will not change its name or such principal place of
business or chief executive office or remove such records without 30
days prior written notice to the Collateral Agent.
(e) At any time and from time to time, upon the written
request of the Collateral Agent, and at the sole expense of DTFC, DTFC
will promptly and duly execute and deliver any and all such further
instruments and documents and take such further action as the
Collateral Agent may reasonably deem necessary in obtaining the full
benefits of this Collateral Agreement and of the rights and powers
herein granted, including, without limitation, the filing of any
financing or continuation statements under the Uniform Commercial Code
in effect in any jurisdiction with respect to the liens and security
interests granted hereby. DTFC also hereby authorizes the Collateral
Agent if directed by the secured Parties to file any such financing or
continuation statement without the signature of DTFC to the extent
permitted by applicable law. If any amount payable under or in
connection with any of the Assigned Collateral shall be or become
evidenced by any promissory note, chattel paper or other instrument,
such note, chattel paper or instrument shall be deemed to be held in
trust and immediately pledged to the Collateral Agent hereunder, and
shall, subject to the rights of any Person in whose favor a prior Lien
has been perfected, be duly endorsed in a manner satisfactory to the
Collateral Agent promptly.
(f) DTFC will warrant and defend the Collateral Agent's
right, title and interest in and to the Assigned Collateral and the
income, distributions and proceeds thereof, for the benefit of the
Secured Parties against the claims and demands of all Persons
whomsoever.
-7-
12
(g) All authorizations in this Collateral Agreement for
the Collateral Agent to endorse checks, instruments and securities and
to execute financing statements, continuation statements, security
agreements and other instruments with respect to the Assigned
Collateral are powers coupled with an interest and are irrevocable.
SECTION 3.04. Representations and Warranties of the
Collateral Agent. The Collateral Agent hereby represents, warrants and
covenants to the Secured Parties that this Collateral Agreement has been duly
authorized, executed and delivered by the Collateral Agent and constitutes a
legal, valid and binding obligation of the Collateral Agent, enforceable
against the Collateral Agent in accordance with its terms, except as such
enforceability may be subject to bankruptcy or insolvency laws, creditors'
rights generally and general principles of equity.
ARTICLE IV.
ASSIGNMENT
SECTION 4.01. Assignment. (a) In order to secure and
provide for the payment and repayment of the DTFC Obligations, DTFC hereby
pledges, assigns, conveys, delivers, transfers and sets over to the Collateral
Agent, for the ratable benefit of the Collateral Agent, the Liquidity Lenders,
the Liquidity Agent, the Series 1998-1 Letter of Credit Provider, the
Depositary, the Dealers and the Holders of the Commercial Paper Notes (the
foregoing being referred to as the "Secured Parties") as their respective
interests appear, and hereby grants to the Collateral Agent, for the benefit of
the Secured Parties, a security interest in all of DTFC's right, title and
interest in and to all assets, property and interests in property (other than
as specified below) whether now owned or hereafter acquired or created (all of
the foregoing being referred to as the "Assigned Collateral"), including
without limitation, all of the following property and interests in property:
(i) the DTFC Agreements, including, without limitation,
the Series 1998-1 Notes, all monies due and to become due to DTFC from
RCFC under or in connection with the DTFC Agreements, whether payable
as principal, interest, fees, expenses, costs, indemnities, insurance
recoveries, damages for the breach of any of the DTFC Agreements or
otherwise, and all rights, remedies, powers, privileges and claims of
the Debtor against any other party under or with respect to the Series
1998-1 Notes, the Series 1998-1 Supplement and other DTFC Agreements
(whether arising pursuant to the terms of such DTFC Agreements or
otherwise available to DTFC at law or in equity), the right to enforce
the Series 1998-1 Notes, the Series 1998-1 Supplement or any other
DTFC Agreement as provided herein and to give or withhold any and all
consents, requests, notices, directions, approvals, extensions or
waivers under or with
-8-
13
respect to the Series 1998-1 Notes, the Series 1998-1 Supplement or
any other DTFC Agreement or the obligations of any party thereunder;
and
(ii) all right, title and interest of DTFC in, to and
under any Vehicle Disposition Program as they relate to the Existing
Fleet or to the Financed Vehicles financed with the proceeds of the
Series 1998-1 Notes, and all monies due and to become due in respect
of such Vehicles from the Manufacturers under or in connection with
the Vehicle Disposition Programs, whether payable as Vehicle
repurchase prices, auction sales proceeds, fees, expenses, costs,
indemnities, insurance recoveries, damages for breach of the Vehicle
Disposition Programs or otherwise and all rights to compel performance
and otherwise exercise remedies thereunder; and
(iii) all additional property that may from time to time
hereafter be subjected to the grant and pledge hereof by DTFC or by
anyone on its behalf; and
(iv) all property assigned to the Collateral Agent
pursuant to Section 5.02, including the Accounts, the Series 1998-1
Cash Collateral Account and the Deposited Funds; and
(v) all proceeds, products and profits of and from any
and all of the foregoing, including, without limitation, payments
under insurance (whether or not the Collateral Agent is the loss payee
thereof) or Vehicle warranties and cash.
Notwithstanding the foregoing, upon the disbursement by the Collateral Agent of
any amount distributable to DTFC in accordance with the terms of Section 2.01
or 5.02(b) for the payment of DTFC's operating and ordinary course expenses,
the security interest in such amount granted in favor of the Collateral Agent
shall be released.
(b) Notwithstanding the assignment and security interest so granted
to the Collateral Agent, DTFC shall nevertheless be permitted, subject to the
Collateral Agent's right to revoke such permission in the event of a Liquidity
Agreement Amortization Event (other than a Scheduled Liquidity Agreement
Amortization Event) or a Liquidation Event of Default and the provisions of
Section 4.03 hereof, to give all consents, requests, notices, directions,
approvals, extensions or waivers, if any, which are required to be given in the
normal course of business (which does not include waivers of defaults under any
of the DTFC Agreements or revocation of powers of attorney to RCFC) to RCFC by
DTFC by the specific terms of the Series 1998-1 Supplement or to any other
obligor under the Assigned Collateral, and the assignment of the Assigned
Collateral to the Collateral Agent shall not (i) relieve DTFC from the
performance of any term, covenant, condition or agreement on DTFC's part to be
performed or observed under or in connection with any of the DTFC Agreements or
from any liability to RCFC, the Collateral Agent or the Manufacturers, as the
case may be, or (ii) impose any obligation on any of the Secured Parties to
perform or observe any such term, covenant, condition or
-9-
14
agreement on DTFC's part to be so performed or observed or impose any liability
on any of the Secured Parties for any act or omission on the part of DTFC or
from any breach of any representation or warranty on the part of DTFC. DTFC
hereby agrees to indemnify and hold harmless each Secured Party (which for
purposes of this Section 4.01(b) shall include their officers, directors,
employees and agents) from and against any and all losses, liabilities
(including liabilities for penalties), claims, demands, actions, suits,
judgments, reasonable out-of-pocket costs and expenses arising out of or
resulting from the assignment granted hereby by virtue of any act or omission
on the part of DTFC including, without limitation, the reasonable out-of-pocket
costs, expenses, and disbursements (including reasonable attorneys' fees and
expenses) incurred by any of the Secured Parties in enforcing this Collateral
Agreement or preserving any of their respective rights to, or realizing upon,
any of the Assigned Collateral other than any arising in connection with gross
negligence or willful misconduct on the part of any Secured Party.
SECTION 4.02. Application of Assigned Collateral and
Deposited Funds. DTFC hereby acknowledges and agrees that, until this
Collateral Agreement is terminated, DTFC shall, and the Collateral Agent is
authorized to, cause all monies, instruments, cash and other proceeds due and
to become due to DTFC or the Collateral Agent under or in connection with the
Assigned Collateral for the Series 1998-1 Notes to be paid directly to the
Collateral Agent for deposit into the Collateral Account or such other account
as the Collateral Agent may from time to time specify to the Person making such
payments (and DTFC represents to the Secured Parties that it has instructed
RCFC and the Manufacturers, as applicable, to so remit such amounts). DTFC
agrees that if any such monies, instruments, cash or other proceeds shall be
received by DTFC in an account other than the Collateral Account or in any
other manner, such monies, instruments, cash and other proceeds will not be
commingled by DTFC with any of its other funds or property, if any, but will be
held separate and apart therefrom and shall be held in trust by DTFC for, and
immediately paid over to, but in any event within two Business Days from
receipt, the Collateral Agent with any necessary endorsement. Provided that
the Collateral Account or any funds on deposit in, or otherwise to the credit
of, the Collateral Account are not then subject to any writ, order, judgment,
warrant of attachment, execution or similar process, all monies, instruments,
cash and other proceeds received by the Collateral Agent pursuant to this
Article IV shall be immediately deposited in the Collateral Account, and,
unless and until a Liquidity Agreement Amortization Event shall have occurred
and be continuing, shall be applied as provided in Section 5.02(b) hereof. All
monies, instruments, cash and other proceeds held or deposited in the
Collateral Account after the occurrence and during the continuance of a
Liquidity Agreement Amortization Event and all monies, instruments, cash and
other proceeds received by the Collateral Agent pursuant to this Article IV
while the Collateral Account or any funds on deposit in, or otherwise to the
credit of, the Collateral Account are subject to any writ, order, judgment,
warrant of attachment, execution or similar process, shall be applied by the
Collateral Agent (to the extent permitted by law) to the payment or repayment
in full of all outstanding DTFC Obligations, in the appropriate order of
priority specified in Section 2.01 of this Collateral Agreement.
-10-
15
Notwithstanding the foregoing, to the extent that the aggregate amount of
proceeds relating to any Vehicle received in the Collateral Account exceeds the
Net Book Value of such Vehicle, the Collateral Agent shall, upon the written
direction of DTFC (on which it may conclusively rely), release such excess (to
the extent not previously applied hereunder) to RCFC within two Business Days
after the receipt of written instructions from the Master Servicer.
SECTION 4.03. Performance of Agreement. (a) Upon the
occurrence of a Liquidation Event of Default, promptly following a request from
the Collateral Agent to do so and at DTFC's own expense, DTFC agrees to take
all such lawful action and as permitted under this Collateral Agreement as the
Collateral Agent may reasonably request to compel or secure the performance and
observance by RCFC or by any other party to any DTFC Agreement or any other CP
Program Document of its obligations to DTFC in accordance with the applicable
terms thereof, and to exercise any and all rights, remedies, powers and
privileges lawfully available to DTFC to the extent and in the manner
reasonably directed by the Collateral Agent, including, without limitation, the
transmission of notices of default and the giving of directions, or the
institution of legal or administrative actions or proceedings to compel or
secure performance by RCFC (or such party to any DTFC Agreement or any other CP
Program Document), of their respective obligations thereunder; provided,
however, that if DTFC shall have failed, within 2 Business Days of receiving
the direction by the Collateral Agent, to accomplish such directions of the
Collateral Agent, the Collateral Agent may, but shall not be obligated to, take
such previously directed action (and any related action as permitted under this
Collateral Agreement thereafter determined by the Collateral Agent to be
appropriate without the need under this provision or any other provision
hereunder to direct DTFC to take such action) on behalf of DTFC and the Secured
Parties. Upon the occurrence of a Liquidation Event of Default, the Collateral
Agent may, and upon written direction from the Required Liquidity Providers
shall, take all lawful action at DTFC's expense (for reasonable costs and
expenses), to exercise any and all rights, remedies, powers and privileges
lawfully available to the Collateral Agent to the extent and in the manner
directed by the Required Liquidity Providers or, in the absence of such
direction, by the Collateral Agent itself, including, without limitation, the
transmission of notices of default and the institution of legal or
administrative actions or proceedings to compel or secure performance by RCFC,
DTFC or any obligor with respect to the Assigned Collateral (including, without
limitation, any Manufacturer under a Vehicle Disposition Program), and to
exercise any other remedies available to a secured party.
Subject to Section 4.01(b), DTFC further agrees that it will not,
without the prior written consent of the Collateral Agent, exercise any right,
remedy, power or privilege available to it with respect to any obligor under
the Assigned Collateral, take any action to compel or secure performance or
observance by any obligor of its obligations to DTFC or give any consent,
request, notice, direction, approval, extension or waiver with respect to any
obligor.
-11-
16
In the event of a Liquidation Event of Default, the Required Liquidity
Providers shall be deemed to have directed that the Collateral Agent, and RCFC
return each Vehicle to the related Manufacturer under the related Vehicle
Disposition Program at the end of the minimum holding period (if any) for such
Vehicle under the related Vehicle Disposition Program, unless the Required
Liquidity Providers specifically waive such direction in writing.
(b) Unless otherwise specifically directed by the Required
Liquidity Providers in writing, in the event that there has occurred a
Manufacturer Event of Default, and the Collateral Agent shall have received
written notice thereof from any Secured Party, the Collateral Agent agrees to
direct the Master Collateral Agent to sell any and all Vehicles covered by the
related Vehicle Disposition Program of such Manufacturer for the highest
purchase price offered at a public or private sale and, promptly upon receipt,
to deposit the proceeds of such sale into the Collateral Account for
application in accordance with Section 5.02(b) or 2.01, as applicable.
SECTION 4.04. Amendments; Waivers; Declaration of Default.
Without intending in any manner to derogate from the absolute nature of the
assignment granted to the Collateral Agent by this Collateral Agreement or the
rights of the Collateral Agent hereunder, DTFC agrees that it will not, without
giving prior written notice to the Rating Agencies and the Dealers and without
the prior written consent of the Required Liquidity Providers and the
Collateral Agent (to the extent the rights or duties of the Collateral Agent
are affected thereby), amend, modify, supplement, terminate, waive or
surrender, or agree to any amendment, modification, supplement, termination or
surrender of, the terms of any Assigned Collateral, or waive timely performance
or observance by any obligor of its obligations under the Assigned Collateral,
or any default on the part of any obligor under the Assigned Collateral;
provided, however, that DTFC may amend the terms of any Assigned Collateral if
such amendment is effected only to cure any ambiguity, to correct or supplement
any provision therein which may be inconsistent with any other provision
therein or which is otherwise defective, or to make any other provisions with
respect to matters or questions arising under such Assigned Collateral which
shall not be inconsistent with the provisions of such Assigned Collateral;
provided further, however, any such action pursuant to this clause shall not
adversely affect the interests of a Secured Party in any material respect.
DTFC will not agree to any such amendment, waiver or other change (i) if such
amendment, waiver or other change would have a material adverse effect on the
rights or interests of the Holders of the Commercial Paper Notes or (ii) if the
Collateral Agent shall not have received written confirmation of the Rating
Agencies that such amendment, waiver or other change will not result in the
downgrading or withdrawal of the then current ratings of the Commercial Paper
Notes by the Rating Agencies. If any such amendment, modification, supplement
or waiver shall be so consented to by the Collateral Agent (to the extent
required) and the Required Liquidity Providers (to the extent required), DTFC
agrees, promptly following a request by the Collateral Agent or the Liquidity
Agent to do so, to execute and deliver, in its own name and at its own expense
(i) an officer's certificate and an opinion of counsel that such amendment is
-12-
17
in compliance with the requirements of this Collateral Agreement, and (ii) such
other agreements, instruments, consents and other documents as the Collateral
Agent or the Liquidity Agent, as the case may be, may deem necessary or
appropriate in the circumstances. No consent by the Collateral Agent or any
other Secured Party to any such amendment, modification, supplement or waiver
shall be deemed to be a determination by the Collateral Agent that such
amendment, modification, supplement or waiver will not adversely affect the
rights of any Holder of Commercial Paper Notes.
Upon the occurrence of a Liquidity Agreement Amortization Event, the
Collateral Agent, upon direction by the Required Liquidity Providers, shall
direct DTFC (i) not to make any further Advances under the Note Purchase
Agreement, and (ii) if no Commercial Paper Notes are then outstanding, to
declare, or to direct the Trustee to declare, the Series 1998-1 Notes
immediately due and payable.
SECTION 4.05. Notice of Default. Promptly upon becoming
aware thereof, DTFC agrees to give the Liquidity Agent, the Liquidity Lenders,
the Depositary, the Dealers, the Collateral Agent and each Rating Agency prompt
written notice (and in no case more than two days after DTFC has actual
knowledge thereof) of each Liquidity Agreement Amortization Event or Potential
Liquidity Agreement Amortization Event and each default on the part of any
Manufacturer under any Vehicle Disposition Program that comes to DTFC's
attention.
ARTICLE V.
COLLATERAL ACCOUNT, LIQUIDITY LENDER ACCOUNT,
AND CREDIT ENHANCER ACCOUNT
SECTION 5.01. Establishment of Collateral Account, etc.
For purposes of the Liquidity Agreement, the CP Enhancement Letter of Credit
Application and Agreement and the Depositary Agreement, the Collateral Agent
shall at all times during the term of this Collateral Agreement maintain at a
U.S. branch or agency of Bankers Trust Company (i) a segregated trust account
for the benefit of the Secured Parties (said account being herein called the
"Collateral Account" and being identified as Account 25290), (ii) a segregated
trust account for the benefit of the Secured Parties (said account being herein
called the "Termination Advance Account" and being identified as Account
25292), (iii) a segregated trust account for the Liquidity Lenders and the
Liquidity Agent (said account being herein called the "Liquidity Lender
Account" and being identified as Account 25293), and (iv) a segregated trust
account for the benefit of the Secured Parties (said account being herein
called the "Series 1998-1 Pledge Account" and being identified as Account
25294), the operation of each of which shall be governed by this Article V
(the Collateral Account, the Termination Advance Account, the Liquidity Lender
Account and the Series 1998-1 Pledge Account are collectively referred to
herein as the "Accounts").
-13-
18
It is understood and agreed by DTFC and the Secured Parties that on
any Business Day there shall be deposited in the Collateral Account the
following monies, instruments, cash and proceeds received by the Collateral
Agent or DTFC at any time and from time to time: (a) from the Depositary from
the sale of Commercial Paper Notes to the extent in excess of maturing
Commercial Paper Notes, (b) as payments on the Series 1998-1 Notes and any
other proceeds of the Assigned Collateral, (c) from the Enhancement Agent as
LOC Liquidity Disbursements, and (d) any and all moneys at any time and from
time to time received on behalf of DTFC, and required by the terms of this
Collateral Agreement or any other CP Program Document to be deposited in the
Collateral Account.
It is further understood and agreed by DTFC and the Secured Parties
that there shall be deposited in the Termination Advance Account the monies,
instruments, cash and proceeds received by the Collateral Agent or DTFC at any
time and from time to time from any Liquidity Lender pursuant to Section 3.6.3
of the Liquidity Agreement.
It is further understood and agreed by DTFC and the Secured Parties
that there shall be deposited in the Liquidity Lender Account or the Commercial
Paper Account the following monies, instruments, cash and proceeds received by
the Collateral Agent or DTFC at any time and from time to time: (a) from any
Liquidity Lender pursuant to Section 3.6.1 or 3.6.2 of the Liquidity Agreement
and (b) any and all monies at any time and from time to time received on behalf
of DTFC, and required by the terms of this Collateral Agreement, the Liquidity
Agreement or any other CP Program Document to be deposited in the Liquidity
Lender Account or the Commercial Paper Account.
All monies, instruments, cash and proceeds deposited at any time and
from time to time in any and all of the Accounts and the Series 1998-1 Cash
Collateral Account (other than amounts on deposit in the Series 1998-1 Cash
Collateral Account constituting earnings on investments or interest on
withdrawals and any amounts in excess of the Minimum Enhancement Amount that
are to be released pursuant to Section 4.18(d) of the Series 1998-1 Supplement)
are referred to as "Deposited Funds"; provided that (i) Deposited Funds in the
Series 1998-1 Cash Collateral Account may only be used for the purposes
provided in Section 4.18 of the Series 1998-1 Supplement and shall be under the
sole dominion and control of the Trustee and subject to Section 4.18 of the
Series 1998-1 Supplement, (ii) Deposited Funds in the Termination Advance
Account may only be used to make payments pursuant to clause Second of Section
2.01 or Section 5.02(b)(i) hereof, and (iii) the Deposited Funds in the Series
1998-1 Pledge Account may only be used for the purposes provided in Section 2.5
of the Liquidity Agreement (A) to make payments pursuant to clause Second of
Section 2.01 and to the extent a Borrowing Base Deficiency continues to exist,
to make payments pursuant to clause Fifth of Section 2.01 and (B) to make
payments pursuant to Section 5.02(b)(i) and, to the extent a Borrowing Base
Deficiency continues to exist, to make payments pursuant to Section 5.02
(b)(iv). Subject to Section 4.18 of the Series 1998-1 Supplement, Deposited
Funds may, at DTFC's discretion upon DTFC's written direction and at DTFC's
expense, be
-14-
19
invested in Eligible Investments; provided that if a Liquidity Agreement
Amortization Event (other than a Scheduled Liquidity Agreement Amortization
Event) shall have occurred and be continuing or any DTFC Obligations then due
shall be unpaid, DTFC's rights to invest shall terminate and the Collateral
Agent shall have the right (but not the obligation) to invest funds at DTFC's
expense in Eligible Investments.
In addition, DTFC agrees that it will not, and will not permit any
Person on behalf of DTFC to, issue Commercial Paper Notes after DTFC has
received notice that any of the Accounts or the Series 1998-1 Cash Collateral
Account is subject to any stay, writ, judgment, warrant of attachment,
execution or other similar process; provided that if any such writ, order,
judgment, warrant of attachment, execution or other similar process is removed
or dismissed, DTFC may recommence issuing, and permitting any Person on behalf
of DTFC to issue, Commercial Paper Notes.
SECTION 5.02. Assignment of Accounts, etc. (a) In order to
secure and provide for the repayment and payment of the DTFC Obligations, DTFC
hereby assigns, pledges, grants, transfers and sets over to the Collateral
Agent, for the benefit of the Secured Parties, all of DTFC's right, title and
interest in and to the following (whether now or hereafter existing and whether
now owned or hereafter acquired): (i) the Accounts and the Series 1998-1 Cash
Collateral Account and all claims of DTFC in and to the Accounts and the Series
1998-1 Cash Collateral Account, (ii) the Deposited Funds and all claims of DTFC
in and to the Deposited Funds, (iii) all certificates and instruments, if any,
representing or evidencing any or all of the Accounts or the Series 1998-1 Cash
Collateral Account, (iv) all interest, dividends, cash, instruments and other
property from time to time, received, receivable or otherwise distributed in
respect of or in exchange for any or all of the Accounts or the Series 1998-1
Cash Collateral Account, the Deposited Funds or the Eligible Investments and
all claims of DTFC therein and thereto, (v) all Eligible Investments made at
any time and from time to time with the moneys in any and all of the Accounts
or the Series 1998-1 Cash Collateral Account and all claims of DTFC therein and
thereto and (vi) all proceeds of any and all of the foregoing, including,
without limitation, cash. Throughout the term of this Collateral Agreement,
the Collateral Agent shall be a pledgee in possession of the Deposited Funds
and shall have the sole and exclusive right to withdraw or order a transfer of
Deposited Funds from the Accounts subject to the provisions of the next
succeeding paragraph, and DTFC hereby appoints the Collateral Agent the true
and lawful attorney of DTFC, with full power of substitution, for the purpose
of making any such withdrawal or ordering any such transfer of Deposited Funds
from any of the Accounts and from the Series 1998-1 Cash Collateral Account,
which appointment is coupled with an interest and is irrevocable subject to
DTFC's right to remove the Collateral Agent as described in Section 7.04 of
this Collateral Agreement.
(b) So long as no Liquidity Agreement Amortization Event shall
have occurred and then be continuing, DTFC, with respect to clauses (ii) and
(iv) through (viii) below, and the Depositary with respect to clause (i) below,
and the Liquidity Agent, on behalf of the Liquidity
-15-
20
Lenders, with respect to clause (iii) below, shall have the right to instruct
the Collateral Agent in writing to withdraw or allocate and retain, or order
the transfer of, Deposited Funds from any of the Accounts (subject to the
penultimate paragraph of Section 5.01 with respect to the Series 1998-1 Pledge
Account and the Termination Advance Account), from time to time as necessary,
for deposit into the Group II Collection Account or for the following purposes
in the following priority:
(i) the payment of all Indebtedness, at any time and from
time to time due from DTFC to the Holders of the Outstanding
Commercial Paper Notes issued pursuant to and in accordance with the
Depositary Agreement;
(ii) the payment of all (a) operating and ordinary course
expenses of DTFC up to an aggregate amount equal to $100,000 per annum
and (b) fees and expenses at any time and from time to time due to the
Depositary pursuant to Sections 8(a) and 8(b) of the Depositary
Agreement or due to the Collateral Agent hereunder to the extent no
Borrowing Base Deficiency results;
(iii) the payment of all amounts at any time and from time
to time notified by the Liquidity Agent to the Collateral Agent
pursuant to Section 3.6.5 of the Liquidity Agreement;
(iv) the payment, pro rata, of all principal Indebtedness
(including Commitment Termination Date Liquidity Advances) at any time
and from time to time due (in the case of a Commitment Termination
Date Liquidity Advance, such Advance will be deemed to be due for
purposes of this Section 5.02(b)(iv) on the date such Advance is made)
from DTFC (a) to the Liquidity Lenders in connection with the
Liquidity Advances made pursuant to the Liquidity Agreement, and (b)
to the Series 1998-1 Letter of Credit Provider (or, if applicable, to
the Series 1998-1 Cash Collateral Account) in connection with moneys
drawn under the Series 1998-1 Letter of Credit (or withdrawn from the
Series 1998-1 Cash Collateral Account) to fund any LOC Liquidity
Disbursements, together with all amounts payable in respect of
interest on any of the foregoing, together with all amounts payable in
respect of interest on any of the foregoing;
(v) to the extent no Borrowing Base Deficiency results
therefrom, the payment, pro rata, of all other Indebtedness
(including, but not limited to, fees, reimbursements, indemnities,
taxes and increased costs, but excluding amounts referenced in clause
(vi) below) at any time and from time to time due and owing to the
Liquidity Lenders, the Series 1998-1 Letter of Credit Provider (solely
with respect to amounts due from DTFC under the CP Enhancement Letter
of Credit Application and Agreement), the Liquidity Agent and the
Collateral Agent and the payment, pro rata, of any other amounts
(excluding those referenced in clause (vi) below) at any time and
-16-
21
from time to time due from DTFC to any of them under or in respect of
the Liquidity Agreement, the Series 1998- 1 Letter of Credit, the CP
Enhancement Letter of Credit Application and Agreement, and this
Collateral Agreement, together with all amounts due from DTFC in
respect of interest thereon, and the payment, pro rata, of all
indemnities at any time and from time to time due from DTFC hereunder
to the Liquidity Lenders or the Series 1998-1 Letter of Credit
Provider, it being understood that amounts payable under this clause
(v) shall relate exclusively to costs and expenses incurred in or in
connection with this Collateral Agreement, the procurement and
handling of funds and the making of such funds available to or for the
account or benefit of DTFC and shall not include amounts payable in
connection with general indemnity claims relating to the use by DTFC
or the Series 1998-1 Letter of Credit Provider of the proceeds of such
financial accommodations (other than, in the event such actions give
rise to breakage costs, any action in the nature of a prepayment by
DTFC) or actions taken or omitted to be taken by DTFC under the CP
Program Documents and not directly related to the procurement of
funds, all of which shall be covered by clause (vi) below;
(vi) to the extent no Borrowing Base Deficiency results
therefrom, the repayment, pro rata, of all reasonable amounts advanced
or expended by the Collateral Agent, the Liquidity Agent, any
Liquidity Lender or the Series 1998-1 Letter of Credit Provider
hereunder or in connection with the Liquidity Agreement or the Series
1998-1 Letter of Credit or the CP Enhancement Letter of Credit
Application and Agreement (solely with respect to amounts due from
DTFC under the CP Enhancement Letter of Credit Application and
Agreement), as the case may be, and any other amounts and reasonable
out-of-pocket costs and expenses due from DTFC to any Secured Party
under or in connection with this Collateral Agreement, the Liquidity
Agreement, the Series 1998-1 Letter of Credit, the CP Enhancement
Letter of Credit Application and Agreement, the Depositary Agreement
or the Dealer Agreement whether in respect of indemnities thereunder
or otherwise;
(vii) to the extent no Borrowing Base Deficiency results
therefrom, the payment of all other expenses of DTFC in excess of the
amounts paid under clause (ii) above;
(viii) the making of further Advances by DTFC under the Note
Purchase Agreement for the purchase of the Series 1998-1 Invested
Amount; and
(ix) the balance of such Deposited Funds shall be retained
in the appropriate Account and invested pursuant to Section 5.04 in
Eligible Investments.
(c) The Collateral Agent shall apply moneys as provided in Section
5.02(b) promptly upon receipt of written or telephonic instructions from a DTFC
Agent or, with
-17-
22
respect to clause (b)(i) above, a Depositary Agent, or with respect to clause
(b)(iii) above, the Liquidity Agent. Any telephonic instructions shall be
promptly confirmed in writing. The Collateral Agent shall make the required
withdrawals and transfers on the same day provided that it shall have received
instructions prior to 2:00 p.m. (New York City time) on such day. Absent
manifest error, the Collateral Agent shall have no responsibility for verifying
that moneys being transferred pursuant to this Section 5.02 are in the proper
amounts or that any conditions to such transfers are complied with. All
instructions furnished to the Collateral Agent pursuant to this Section 5.02(c)
or 5.03 shall specify the account to which moneys are to be transferred;
provided that moneys payable to any Liquidity Lender shall be transferred to
the Liquidity Agent for distribution to such Liquidity Lender.
(d) The Collateral Agent shall, with the cooperation of the
Depositary and the Liquidity Agent, monitor the amount of Outstanding
Commercial Paper Notes, Outstanding Liquidity Advances (to be provided by the
Liquidity Agent), and the current Borrowing Base and CP Borrowing Base (each of
which is to be provided by DTFC), and determine whether or not a Borrowing Base
Deficiency or CP Borrowing Base Deficiency exists on any Business Day. In this
regard, DTFC hereby agrees to provide the Collateral Agent and the Liquidity
Agent, (i) on or prior to the fifth (5th) Business Day of each month, a
statement reflecting the Borrowing Base as of the close of business on the last
day of the immediately preceding Related Month and (ii) promptly upon request
from the Collateral Agent or the Liquidity Agent, but in no event more than
three (3) Business Days from the date of such request, a statement reflecting
the Borrowing Base as of the close of business on the fifth (5th) Business Day
prior to the delivery of such statement, which statement shall, in each case,
be certified by the chief financial officer of DTFC. DTFC shall provide copies
of such monthly statement to each Rating Agency and the Dealers. Upon each
occasion that DTFC delivers a Borrowing Base Certificate to the Liquidity Agent
in accordance with the Liquidity Agreement, DTFC shall provide a copy of such
Certificate to the Collateral Agent hereunder. The Collateral Agent may
conclusively rely on such certified statement or certificate at all times from
and after the issuance thereof until issuance of a new such certified statement
or certificate, without any obligation on the part of the Collateral Agent to
confirm the truth, accuracy or completeness of such certified statement or
certificate and without any obligation on the part of the Collateral Agent to
undertake any other inquiry with respect thereto. Upon each occasion that DTFC
delivers information relating to the Borrowing Base to the Depositary in
accordance with Section 3(a) of the Depositary Agreement, DTFC shall provide a
copy of the notice containing such information to the Collateral Agent
hereunder. DTFC agrees to notify the Collateral Agent promptly, and in any
event within one Business Day, upon its obtaining knowledge of the existence of
any Borrowing Base Deficiency or CP Borrowing Base Deficiency.
(e) The Collateral Agent shall from time to time, but at least
monthly, provide DTFC with statements of account relating to the Accounts and
the Series 1998-1 Cash
-18-
23
Collateral Account in accordance with the Collateral Agent's customary
practices and in a form reasonably satisfactory to the Collateral Agent and
DTFC.
(f) Upon the occurrence and during the continuance of a Liquidity
Agreement Amortization Event, all rights of DTFC to request the Collateral
Agent to withdraw or order the transfer of Deposited Funds from the Accounts or
the Series 1998-1 Cash Collateral Account shall cease, and the Collateral
Agent, at the direction (which direction shall be in writing or by telephone
(confirmed in writing promptly thereafter)) of the Required Liquidity Providers
shall (subject to Section 7.01 hereof), at any time and from time to time,
appropriate and apply the Deposited Funds then, or at any time thereafter, on
deposit in the Accounts or the Series 1998-1 Cash Collateral Account to the
payment or prepayment in full of all outstanding DTFC Obligations, whether or
not then due, in the order of priority specified in Section 2.01 hereof (or in
the case of the Series 1998-1 Cash Collateral Account, in accordance with
Section 4.18 of the Series 1998-1 Supplement). The Collateral Agent shall make
all payments with respect to Commercial Paper Notes outstanding pursuant to
clause Second of Section 2.01 to the Depositary for application to the pro rata
payment, in accordance with their terms and subject to the provisions of the
Depositary Agreement, of the face amount of matured and unmatured Commercial
Paper Notes, whether or not such Commercial Paper Notes have been presented to
the Depositary for payment.
SECTION 5.03. Application of Deposited Funds and Assigned
Collateral. For purposes of determining the payment to be made to any Person
of any Assigned Collateral and Deposited Funds pursuant to Sections 2.01 and
5.02 hereof, the Collateral Agent may rely on certificates or statements
furnished to or by it in accordance with the provisions of this Section 5.03;
provided, however, to the extent that the Collateral Agent has previously
received telephonic or written instructions with respect to determining the
payment to be made to any Person of any Assigned Collateral and Deposited Funds
pursuant to Section 5.02(c), the Collateral Agent may conclusively rely on such
previously received instructions. For purposes of determining the application
to be made of Deposited Funds and any Assigned Collateral to any Holder
pursuant to clause Second of Section 2.01 and clause (i) of Section 5.02(b) or
to the Depositary pursuant to clause First of Section 2.01, clause Eighth of
Section 2.01 or Section 5.02(b)(ii)(b), the Collateral Agent may rely
exclusively upon a certificate or other statement (a copy of which shall at the
same time also be provided to DTFC) of the Depositary as to the amount then
owing to such Holder. For purposes of determining the application to be made
of Deposited Funds and any Assigned Collateral to any Liquidity Lender, the
Liquidity Agent or the Series 1998-1 Letter of Credit Provider, pursuant to
clause Fourth, Fifth, Sixth or Eighth of Section 2.01 hereof (and the
corresponding provisions under Section 5.02(b)), the Collateral Agent may rely
exclusively upon a certificate or other statement (a copy of which shall at the
same time also be provided to DTFC) of the Liquidity Agent (with respect to
amounts owing to it or any Liquidity Lender) or the Series 1998-1 Letter of
Credit Provider, as the case may be, as to the amount then owing to any such
Liquidity Lender, the Liquidity Agent or the Series 1998-1 Letter of Credit
Provider, as the case may be. Any application to
-19-
24
be made of Deposited Funds and Assigned Collateral to the Collateral Agent
pursuant to clause First or Seventh of Section 2.01 hereof (and the
corresponding provisions under Section 5.02(b)) may be made upon the Collateral
Agent's own certificate or statement delivered to DTFC and the Liquidity Agent,
setting forth in reasonable detail the nature of the Collateral Agent's claim
and the amount owing to the Collateral Agent on account thereof. For purposes
of determining the application to be made of Deposited Funds and Assigned
Collateral to DTFC pursuant to clause Third or Ninth of Section 2.01 or the
corresponding provisions under Section 5.02(b) hereof or to any Dealer or any
other Person (other than any party hereto or any Liquidity Lender) pursuant to
clause Eighth of Section 2.01 or the corresponding provisions under Section
5.02(b) hereof, the Collateral Agent may rely conclusively upon a certificate
or other statement of DTFC as to the amount then owing to DTFC or such other
party. The Collateral Agent shall not be liable for any application of the
Deposited Funds in accordance with any certificate or direction delivered
pursuant to this Section 5.03 or 5.02(c); provided, however, that no
application of the Deposited Funds and Assigned Collateral in accordance with
any certificate or statement delivered pursuant to this Section 5.03 or 5.02(c)
shall be deemed to restrict or limit the right of the Collateral Agent, DTFC,
the Liquidity Agent, the Depositary, any Liquidity Lender or any Dealer to
contest with the purported obligee its respective rights in respect of the
amount set forth in such certificate or statement.
SECTION 5.04. Eligible Investments. So long as no
Liquidity Agreement Amortization Event (other than a Scheduled Liquidity
Agreement Amortization Event) shall have occurred and be continuing and all
DTFC Obligations due and owing by DTFC have been paid, monies held in the
Accounts shall be invested daily, and the proceeds of investments shall be
reinvested daily, by the Collateral Agent in overnight Eligible Investments
pursuant to the written direction of DTFC and, in all other cases, such monies
and proceeds shall be invested daily and reinvested daily by the Collateral
Agent in accordance with the written direction of the Liquidity Agent. The
Trustee shall direct the investment of monies held in the Series 1998-1 Cash
Collateral Account in overnight Eligible Investments (or Eligible Investments
having longer maturities if (i) RCFC has consented thereto in the case of the
Series 1998-1 Cash Collateral Account and (ii) the Collateral Agent shall have
received written confirmation of the Rating Agencies that Eligible Investments
having such longer maturities will not result in the downgrading or withdrawal
of the then current ratings of the Commercial Paper Notes by the Rating
Agencies) at the direction of Master Servicer under the Master Lease with
respect to the Series 1998-1 Cash Collateral Account as provided in Section
4.18(c) of the Series 1998-1 Supplement; provided, however, that so long as a
Liquidity Agreement Amortization Event (other than a Scheduled Liquidity
Agreement Amortization Event) shall have occurred and be continuing, the
Liquidity Agent shall direct the investment of such monies as provided in the
Series 1998-1 Supplement. The Collateral Agent shall not be responsible or
liable for any loss resulting from the investment performance of any investment
or reinvestment of monies held in the Accounts or any other account maintained
by the Collateral Agent for the purposes of this Collateral Agreement or in
Eligible Investments or from the sale or liquidation of any Eligible
Investments in accordance with this Collateral
-20-
25
Agreement. All Eligible Investments shall be made in the name of, and shall be
payable to, the Collateral Agent, and all investment costs and expenses shall
be reimbursed to the Collateral Agent by DTFC.
SECTION 5.05. Liquidity Demand; Commitment Termination
Demand. (a) Upon receipt by the Collateral Agent on or prior to 12:15 p.m.
(New York City time) of a written notice from DTFC notifying the Collateral
Agent of the existence and amount of a Commercial Paper Deficit and instructing
the Collateral Agent to deliver a Borrowing Request, the Collateral Agent
shall, by 12:30 p.m. (New York City time) on the date of such notice (or, in
the case of any notice given to the Collateral Agent after 12:15 p.m. (New York
City time), by 12:30 p.m. (New York City time) on the next following Business
Day), deliver a Borrowing Request in the form of Exhibit B to the Liquidity
Agreement to the Liquidity Agent for a Borrowing in the aggregate in the amount
of such Commercial Paper Deficit; provided that if on the date any Borrowing
Request is to be delivered by the Collateral Agent, Deposited Funds are
available in the Termination Advance Account, the Collateral Agent shall
immediately transfer to the Commercial Paper Account such Deposited Funds (up
to the amount of the relevant Commercial Paper Deficit) and reduce the amount
demanded in the Borrowing Request by the amount of the Deposited Funds so
transferred.
(b) So long as the Series 1998-1 Letter of Credit shall not have
been terminated, upon receipt by the Collateral Agent on or prior to 12:30 p.m.
(New York City time) of a written notice from the Depositary notifying the
Collateral Agent of the existence and amount of a Liquidity Deficiency and
directing the Collateral Agent to direct the Enhancement Agent to make a draw
under the Series 1998-1 Letter of Credit, the Collateral Agent shall, by 1:00
p.m. (New York City time) on the date of such notice (or, in the case of any
notice given to the Collateral Agent after 12:30 p.m. (New York City time), by
1:00 p.m. (New York City time) on the next following Business Day), direct the
Enhancement Agent to draw on the Series 1998-1 Letter of Credit in an amount
equal to the lesser of (i) such Liquidity Deficiency and (ii) the full amount
available to be drawn under the Series 1998-1 Letter of Credit on such date by
presenting a draft accompanied by a Certificate of Liquidity Demand in the form
of Annex B to the Series 1998-1 Letter of Credit. No such draw under the
Series 1998-1 Letter of Credit shall be made unless as of the date of such draw
and after giving effect to all Liquidity Advances made on such date under the
Liquidity Agreement, the Liquidity Agent shall notify the Collateral Agent by
telephone (promptly confirmed in writing) that the Aggregate Liquidity
Commitment is fully drawn under the Liquidity Agreement or is not available for
reasons other than a failure to meet conditions precedent.
(c) Upon receipt by the Collateral Agent on or prior to 12:15 p.m.
(New York City time) of a written notice from DTFC directing the Collateral
Agent to request a Commitment Termination Date Liquidity Advance from a
particular Liquidity Lender, the Collateral Agent shall by 12:30 p.m. (New York
City time) on the date of such notice (or, in the case of any notice given to
the Collateral Agent after 12:15 p.m. (New York City time), by 12:30 p.m.
-21-
26
(New York City time) on the next following Business Day), deliver a Borrowing
Request in the form of Exhibit B to the Liquidity Agreement to the Liquidity
Agent for a Borrowing in the aggregate in the amount of such Commitment
Termination Date Liquidity Advance. DTFC agrees to give the Collateral Agent
notice of such direction so the Collateral Agent's Borrowing Request will be
delivered to the Liquidity Agent not less than three nor more than five
Business Days' before such Liquidity Lender's Scheduled Liquidity Commitment
Termination Date.
ARTICLE VI.
DEFAULT
SECTION 6.01. Rights of the Collateral Agent upon Liquidity
Agreement Amortization Event and Liquidation Event of Default. (a) Only if and
whenever a Liquidity Agreement Amortization Event shall have occurred and be
continuing, the Collateral Agent, at the direction (which direction shall be in
writing or by telephone (confirmed in writing promptly thereafter) specifying
the action to be taken) of the Required Liquidity Providers shall, from time to
time, withdraw amounts in the Accounts or cause the Enhancement Agent to
withdraw from the Series 1998-1 Cash Collateral Account for application as
provided in Section 5.02(f) and only if and whenever a Liquidity Agreement
Amortization Event (other than a Scheduled Liquidity Agreement Amortization
Event) shall have occurred and be continuing, the Collateral Agent, at the
direction (which direction shall be in writing or by telephone (confirmed in
writing promptly thereafter) specifying the action to be taken) of the Required
Liquidity Providers may also exercise from time to time any rights and remedies
available to DTFC under applicable law or any CP Program Document or DTFC
Agreement. DTFC agrees to enforce any rights it may have under the DTFC
Agreements and CP Program Documents at the direction of the Collateral Agent.
Any amounts obtained by the Collateral Agent on account of or as a result of
the exercise by the Collateral Agent of any right with respect to any funds at
any time and from time to time on deposit in, or otherwise to the credit of,
any of the Accounts, shall be held by the Collateral Agent as additional
collateral for the repayment of the DTFC Obligations and shall be applied as
provided in Section 2.01 hereof. The Collateral Agent agrees to undertake the
actions set forth with respect to the Collateral Agent in Section 9.2 of the
Liquidity Agreement.
-22-
27
ARTICLE VII.
THE COLLATERAL AGENT, THE LIQUIDITY LENDERS,
AND THE HOLDERS
OF COMMERCIAL PAPER NOTES
SECTION 7.01. Appointment and Powers of Collateral Agent.
The Secured Parties hereby appoint the Collateral Agent their agent hereunder,
and hereby authorize the Collateral Agent to take such action on their behalf
and to exercise such rights, remedies, powers and privileges hereunder as are
specifically authorized to be exercised by the Collateral Agent by the terms
hereof, together with such rights, remedies, powers and privileges as are
reasonably incidental thereto. The parties hereto agree that the Collateral
Agent shall not be required to exercise any discretion or take any action or
refrain from taking any action in its capacity as agent for the Secured Parties
and DTFC, but shall only be required to act or refrain from acting in such
capacity (and shall be fully protected in so acting or refraining from acting)
upon the instruction of the Required Liquidity Providers or DTFC, as the case
may be, as provided herein. The Collateral Agent may execute any of its duties
as agent hereunder by or through agents or employees and shall be entitled to
retain experts and to act in reliance upon the advice of such experts
concerning all matters pertaining to the agencies hereby created and its duties
hereunder, and shall not be liable for any action taken or omitted to be taken
by it in good faith in accordance with the advice of such experts selected by
it. The relationship between the Collateral Agent and each of the Secured
Parties is that of agent and principal only, and nothing herein shall be deemed
to constitute the Collateral Agent a trustee for any of the Secured Parties or
impose on the Collateral Agent any obligations other than those for which
express provision is made herein.
If the Collateral Agent receives unclear or conflicting instructions,
it shall be entitled to refrain from taking action until clear or
non-conflicting instructions are received, but shall inform the instructing
party or parties promptly of its decision to refrain from taking such action.
Except as required by the specific terms of this Collateral Agreement, the
Collateral Agent shall have no duty to exercise any rights, power, remedy or
privilege granted to it hereby, or to take any affirmative action hereunder or
thereunder, unless directed to do so by the Required Liquidity Providers (and
shall be fully protected in acting or refraining from acting pursuant to such
directions which shall be binding on the Secured Parties), and shall not,
without the prior approval of the Required Liquidity Providers, waive any
default on the part of DTFC, RCFC or the Manufacturers with respect to the
Assigned Collateral or amend, modify, supplement or terminate, or agree to any
surrender of, this Collateral Agreement or the Assigned Collateral.
Notwithstanding anything herein to the contrary, the Collateral Agent shall not
be required to take any action which the Collateral Agent has reasonably
determined that a reasonable likelihood exists that such action will expose the
Collateral Agent to personal or financial liability, unless indemnified to its
satisfaction, or which is contrary to this
-23-
28
Collateral Agreement, or any other agreement or instrument relating to the
Assigned Collateral or applicable law.
None of the Secured Parties nor any of its or their respective
directors, officers, employees or agents, shall be liable to any Secured Party
or any other Person for any action taken or omitted to be taken by it or them
hereunder, or in connection herewith, except for its or their own gross
negligence or willful misconduct; nor (except for its own due execution and
delivery thereof) shall the Collateral Agent be responsible to any Secured
Party for the validity, effectiveness, value, sufficiency or enforceability
against RCFC or DTFC of this Collateral Agreement or any other document
furnished pursuant hereto or in connection herewith, or of the Assigned
Collateral (or any part thereof), the Eligible Investments (or any part
thereof) or the Deposited Funds (or any part thereof). Without limiting the
generality of the foregoing, the Collateral Agent: (i) makes no warranty or
representation to any Secured Party and shall not be responsible to any Secured
Party for any statements, warranties or representations made by any other
Person in or in connection with this Collateral Agreement, the Series 1998-1
Supplement, the Vehicle Disposition Programs, the Liquidity Agreement, the
Master Lease or any other document relating to the Assigned Collateral; and
(ii) shall not have any duty to ascertain or to inquire as to the performance
or observance of any of the terms, covenants or conditions of this Collateral
Agreement, the Series 1998-1 Supplement, the Vehicle Disposition Programs, the
Liquidity Agreement, the Master Lease or any other agreements or instruments
relating to the Assigned Collateral on the part of any party hereto or thereto
or to inspect any books and records relating to the Assigned Collateral other
than as it determines reasonably necessary in the fulfillment of its own
obligations hereunder.
The Collateral Agent shall be entitled to rely on any communication,
instrument, paper or other document reasonably believed by it to be genuine and
correct and to have been given, signed or sent by the proper Person or Persons.
The Collateral Agent shall be entitled to assume that no Liquidity Agreement
Amortization Event shall have occurred and be continuing and that the Accounts,
and any funds on deposit in or to the credit of such Accounts, are not subject
to any writ, order, judgment, warrant of attachment, execution or similar
process (collectively a "writ"), unless (i) in the case of any writ, an officer
in the asset finance department of the Collateral Agent has actual knowledge
thereof or (ii) the Collateral Agent has received written notice from the
Liquidity Agent or RCFC under the Liquidity Agreement that the Majority Banks
consider that such a Liquidity Agreement Amortization Event has occurred or
such writ has been issued and continues to be in effect, which notice specifies
the nature thereof. The Collateral Agent may accept deposits from, lend money
to and generally engage in any kind of business with DTFC, any Manufacturer,
RCFC and their respective Affiliates as if it were not the agent of the
Liquidity Lenders and the Holders of Commercial Paper Notes. The Collateral
Agent shall have the right to refrain from taking any action under Article VI
hereof unless it has received written directions from the appropriate parties
to take such action.
-24-
29
SECTION 7.02. Collateral Agents and Employees of the
Collateral Agent. (i) Each Liquidity Lender hereby agrees, in accordance with
its pro rata percentage of the sum of the Aggregate Liquidity Commitment under
the Liquidity Agreement, to indemnify and hold harmless the Collateral Agent
(which for purposes of this Section 7.02 shall include its officers, directors,
employees and agents) (to the extent not reimbursed by DTFC), from and against
any and all losses (other than the Collateral Agent's loss of profit),
liabilities (including, liabilities for penalties), actions, suits, judgments,
demands, damages, out-of-pocket costs and expenses of any kind whatsoever
(including, without limitation, reasonable fees and expenses of counsel and
other experts) incurred or suffered by the Collateral Agent in its capacity as
agent hereunder as a result of any action taken or omitted to be taken by the
Collateral Agent in such capacity or otherwise incurred or suffered by, made
upon, or assessed against the Collateral Agent in such capacity to the extent
not reimbursed by DTFC or by application of the Assigned Collateral; provided
that no Liquidity Lender shall be liable for any portion of any such losses,
liabilities, actions, suits, judgments, demands, costs or expenses resulting
from or attributable to gross negligence or willful misconduct on the part of
the Collateral Agent or its agents or employees. Without limiting the
generality of the foregoing, each Liquidity Lender hereby agrees, in the ratio
aforesaid, to reimburse the Collateral Agent promptly following its demand for
any out-of-pocket expenses (including, without limitation, reasonable fees and
expenses of counsel) incurred by the Collateral Agent hereunder and not
promptly reimbursed to the Collateral Agent by DTFC or by application of the
Assigned Collateral. The obligations of each Liquidity Lender under this
paragraph shall survive the termination of this Collateral Agreement and the
Liquidity Agreement and the discharge of DTFC's obligations thereunder. The
aggregate liability of the Liquidity Lenders hereunder for any claim shall be
limited to a percentage of the indemnity owing equal to the percentage that the
Aggregate Liquidity Commitment is of the Program Size. If at any time,
following its demand therefor, the Collateral Agent shall not be reimbursed by
DTFC or by the Liquidity Lenders, the Collateral Agent is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all amounts at any time held by the Collateral Agent for
the benefit of the Liquidity Lenders, including without limitation any such
amounts designated for disbursement to the Liquidity Lenders in accordance with
Section 2.01 or Section 5.02(b), against any and all of the obligations of the
Liquidity Lenders to the Collateral Agent now or hereafter existing under this
Collateral Agreement. The Collateral Agent agrees promptly to notify each
Liquidity Lender after any such set-off and application made by the Collateral
Agent, provided that the failure to give such notice shall not affect the
validity of such set- off and application. The rights of the Collateral Agent
under this Section are in addition to other rights and remedies which the
Collateral Agent may have. Any such set-off against amounts owed to Liquidity
Lenders by the Collateral Agent shall not cause a payment default of DTFC on
amounts due to such Liquidity Lenders to the extent funds are available in the
Accounts to be allocated to the payment of all amounts due to the Liquidity
Lenders in accordance with Section 2.01 or 5.02(b), as applicable.
-25-
30
(a) No provision of this Collateral Agreement shall require the
Collateral Agent to expend or risk its own funds or otherwise incur any
financial or other liability in the performance of any duties hereunder or in
the exercise of any rights and powers hereunder.
(b) Any action or proceeding alleging any breach by the Collateral
Agent of duties under this Collateral Agreement shall be prosecuted only in the
courts of the State of New York located in the Borough of Manhattan, in New
York City or in the United States District Court for the Southern District of
New York. The Collateral Agent shall have the right at any time to seek
instructions from any court of competent jurisdiction. The Collateral Agent
may rely on the advice of counsel and shall be held harmless for actions taken
in reliance thereon.
(c) The Collateral Agent makes no representation as to, and shall
have no responsibility for, the correctness of any statement contained in, or
the validity or sufficiency of, this Collateral Agreement or any documents or
instruments referred to in this Collateral Agreement or the sufficiency or
effectiveness of any collateral assigned by this Collateral Agreement or as to
or for the validity or collectibility of any obligation contemplated by this
Collateral Agreement. The Collateral Agent shall not be accountable for the
use or application by any person of disbursements properly made by the
Collateral Agent in conformity with the provisions of this Collateral
Agreement.
(d) The Collateral Agent may exercise any of its duties hereunder
by or through agents or employees. The possession of the Assigned Collateral
by such agents or employees shall be deemed to be the possession of the
Collateral Agent.
(e) The provisions of this Section 7.02 shall survive the
termination of this Collateral Agreement or the resignation of the Collateral
Agent hereunder.
SECTION 7.03. Waiver of Jury Trial. EACH OF THE PARTIES
HERETO KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT
OF, UNDER, OR IN CONNECTION WITH, THIS COLLATERAL AGREEMENT OR ANY OTHER CP
PROGRAM DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE PARTIES HERETO IN CONNECTION
HEREWITH OR THEREWITH. EACH OF THE PARTIES HERETO ACKNOWLEDGES AND AGREES THAT
IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH
OTHER PROVISION OF EACH OTHER CP PROGRAM DOCUMENT TO WHICH IT IS A PARTY) AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES HERETO ENTERING
INTO THIS COLLATERAL AGREEMENT AND EACH SUCH OTHER CP PROGRAM DOCUMENT.
-26-
31
SECTION 7.04. Successor Collateral Agent. The Collateral
Agent acting hereunder at any time may resign by an instrument in writing
addressed and delivered, 30 days prior to the effectiveness of such
resignation, to each Liquidity Lender, the Liquidity Agent, the Dealers, DTFC,
each Rating Agency and the Depositary, and may be removed at any time with or
without cause by an instrument in writing duly executed by or on behalf of the
Required Liquidity Providers with written notice to each of the Rating
Agencies. Subject to the provisions hereof, the Required Liquidity Providers
shall appoint, subject to the written consent of DTFC (which consent shall not
be unreasonably withheld), a successor to the Collateral Agent upon any such
resignation or removal, by an instrument of substitution complying with the
requirements of applicable law, or, in the absence of any such requirements,
without any formality other than appointment and designation in writing. Upon
the making and acceptance of such appointment, the execution and delivery by
such successor Collateral Agent of a ratifying instrument pursuant to which
such successor Collateral Agent agrees to assume the duties and obligations
imposed on the Collateral Agent by the terms of this Collateral Agreement, and
the delivery to such successor Collateral Agent of the Assigned Collateral, the
Deposited Funds and documents and instruments then held by the retiring
Collateral Agent, such successor Collateral Agent shall thereupon succeed to
and become vested with all the estate, rights, powers, remedies, privileges,
immunities, indemnities, duties and obligations hereby granted to or conferred
or imposed upon the retiring Collateral Agent named herein, and one such
appointment and designation shall not exhaust the right to appoint and
designate further successor Collateral Agents hereunder. No removal or
resignation of the Collateral Agent shall be effective unless and until a
successor Collateral Agent has been duly appointed, and the appointment of such
successor Collateral Agent has been accepted by such successor Collateral
Agent. No Collateral Agent shall be discharged from its duties or obligations
hereunder until the Assigned Collateral, the Deposited Funds and documents and
instruments then held by such retiring Collateral Agent shall have been
transferred or delivered to the successor Collateral Agent in its capacity as
bank or trust company, until all Deposited Funds held in the Accounts and the
Series 1998-1 Cash Collateral Account maintained with or in the name of the
retiring Collateral Agent shall have been transferred to the new Collateral
Account and until such retiring Collateral Agent shall have executed and
delivered to the successor Collateral Agent appropriate instruments assigning
the retiring Collateral Agent's interest in the Assigned Collateral, the
Accounts, the Series 1998-1 Cash Collateral Account, the Deposited Funds and
Eligible Investments to the successor Collateral Agent. If no successor
Collateral Agent shall be appointed, as aforesaid, or, if appointed, shall not
have accepted its appointment, within 30 days after notice of resignation or
removal of the retiring Collateral Agent, then, subject to the provisions
hereof, the retiring Collateral Agent may appoint a successor Collateral Agent
with the written consent of the Liquidity Agent and (so long as no Liquidity
Agreement Amortization Event (other than a Scheduled Liquidity Agreement
Amortization Event) then exists) DTFC, which consent shall not be unreasonably
withheld. Each such successor Collateral Agent shall provide DTFC, each
Liquidity Lender, the Liquidity Agent and the Depositary with its address, and
telephone, telecopy, telex, E-Mail (if applicable) and TWX numbers, to be used
for purposes of Section 9.04 hereof, in a notice
-27-
32
complying with the terms of said Section. Notwithstanding the resignation or
removal of any Collateral Agent hereunder, the provisions of this Article VII
shall continue to inure to the benefit of such retiring Collateral Agent in
respect of any action taken or omitted to be taken by such retiring Collateral
Agent in its capacity as such while it was Collateral Agent under this
Collateral Agreement. DTFC shall provide prompt notice to each Rating Agency
of the appointment of a successor Collateral Agent.
SECTION 7.05. Qualifications of Collateral Agent. Any
Collateral Agent at any time acting hereunder must at all times be (i) the
corporate trust department of a bank or trust company having its principal
office in the District of Columbia or one of the states located in the United
States, or (ii) a bank or trust company having its principal office in the
District of Columbia or one of the states located in the United States,
authorized to accept deposits, or a branch office or agency of a foreign bank
located in the District of Columbia or one of the states of the United States,
in each case having short-term ratings from Moody's and S&P at least equal to
the rating such Rating Agency then assigns to the Commercial Paper Notes.
SECTION 7.06. Instructions of the Required Liquidity
Providers and Other Parties. In any instance in which the Collateral Agent is
permitted to take action hereunder, the Collateral Agent shall, except as
expressly provided herein or in the Liquidity Agreement, act in accordance with
the written instructions received, if any, from the Required Liquidity
Providers. All instructions and notices from the Required Liquidity Providers
shall be submitted to the Collateral Agent through the Liquidity Agent. All
instructions hereunder required to be given by the Majority Banks shall be
submitted to the Collateral Agent through the Liquidity Agent.
ARTICLE VIII.
AMENDMENTS, MODIFICATIONS, WAIVERS AND CONSENTS
SECTION 8.01. Execution of Amendments, etc. No amendment,
modification, supplement, termination or waiver of or to any provision of this
Collateral Agreement or the defined terms used herein and set forth in the
Definitions List, nor any consent to any departure by DTFC from any provision
of this Collateral Agreement, shall be effective unless the same shall be in
writing and signed on behalf of the Collateral Agent, the Liquidity Agent on
behalf of the Majority Banks, the Depositary, the Series 1998-1 Letter of
Credit Provider and DTFC; provided, however, that (i) the written consent of
all Liquidity Lenders shall be necessary to the extent that any such amendment,
modification, supplement, termination, waiver or consent (a) releases the
assignment given hereunder in respect of any of the Assigned Collateral or (b)
affects this Section 8.01 or Section 2.01 or 5.02 and (ii) such amendment,
modification, supplement, termination or waiver shall not result in the
downgrading or the withdrawal of the then current ratings of the Commercial
Paper Notes provided by the Rating
-28-
33
Agencies as evidenced by written confirmation from the Rating Agencies. Any
waiver of any provision of this Collateral Agreement, and any consent to any
departure by DTFC from the terms of any provision of this Collateral Agreement,
shall be effective only in the specific instance and for the specific purpose
for which given. No notice to or demand upon DTFC in any instance hereunder
shall entitle DTFC to any other or further notice or demand in similar or other
circumstances.
Notwithstanding the foregoing provisions of this Section 8.01, DTFC,
the Liquidity Agent and the Collateral Agent may, at any time and from time to
time, without the consent of the other Secured Parties, enter into any
amendment, supplement or other modification to this Collateral Agreement to
cure any apparent ambiguity or to correct or supplement any provision in this
Collateral Agreement that may be inconsistent with any other provision herein;
provided, however, that (i) any such action shall not have a material adverse
effect on the interests of the Liquidity Lenders and (ii) a copy of any such
amendment, supplement or other modification is furnished the other Secured
Parties, in accordance with the notice provisions hereof, not later than ten
days prior to the execution thereof.
ARTICLE IX.
MISCELLANEOUS
SECTION 9.01. Further Assurances. DTFC (i) from time to
time, at its expense, will promptly execute and deliver all further instruments
and documents, and take all further action, that may be necessary, as
reasonably requested by the Collateral Agent, in order to perfect and protect
any security interest granted or purported to be granted hereby or to enable
the Collateral Agent to exercise and enforce its rights and remedies hereunder
with respect to any Assigned Collateral, including without limitation, the
execution of financing or continuation statements, or amendments thereto and
(ii) hereby authorizes the Collateral Agent, if directed by the Secured
Parties, to file one or more financing or continuation statements, and
amendments thereto, relative to all or any part of the Assigned Collateral
without the signature of DTFC, where permitted by law. A carbon photographic
or other reproduction of this Assigned Collateral Agreement or any financing
statement covering the Assigned Collateral or any part thereof shall be
sufficient as a financing statement where permitted by law.
SECTION 9.02. No Waiver; Cumulative Remedies. No failure
on the part of the Collateral Agent to exercise, and no delay on the part of
the Collateral Agent in exercising any right, power or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right, power or remedy by the Collateral Agent preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
All remedies hereunder are cumulative and are not exclusive of any other
remedies that may be available to the Collateral Agent, whether at law, in
equity or otherwise.
-29-
34
SECTION 9.03. Notice of Amendments; Waivers. Notice of any
amendment, waiver or other change of the terms of the Assigned Collateral
(including, without limitation any model year changes in any Vehicle
Disposition Program) shall be sent by DTFC, promptly upon becoming aware
thereof, to each Rating Agency which shall be required to confirm their ratings
on the Commercial Paper Notes prior to the effectiveness thereof.
SECTION 9.04. Notices, etc. Except where telephonic
instructions or notices are authorized herein to be given, all notices,
demands, directions, instructions and other communications required or
permitted to be given to any party hereto shall be in writing and addressed,
delivered or transmitted to such party at its address or facsimile number set
forth below, or at any other address or facsimile number, as the case may be,
as such party may notify the other parties hereto in accordance with the
provisions of this Section 9.04; provided, however, all monthly statements
provided for in Section 5.02(d) hereof shall be sent by first class mail. Any
notice, if mailed and properly addressed with postage prepaid or if properly
addressed and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be deemed given when
transmitted upon receipt of electronic confirmation of transmission.
If to DTFC:
Dollar Thrifty Funding Corp.
5330 East 31st Street Tulsa,
Oklahoma 74135
Attention: Michael H. McMahon
Telephone: (918) 669-3914
Telecopier: (918) 669-2925
If to the Liquidity Agent:
Credit Suisse First Boston
Eleven Madison Avenue
New York, New York 10010-3629
Attention: Asset Finance Department
Telephone: (212) 325-9078
Telecopier: (212) 325-6677
-30-
35
If to the Depositary:
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attention: Commercial Paper Group
Telephone: (212) 250-3939
Telecopier: (212) 669-5970
If to the Collateral Agent:
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attention: Commercial Paper Group
Telephone: (212) 250-3939
Telecopier: (212) 669-5970
If to the Dealers:
Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010-3629
Attention: Short and Medium Term Finance Department
Telephone: (212) 325-7198
Telecopier: (212) 325-8183
Chase Securities Inc.
270 Park Avenue, 9th Floor
New York, New York 10017
Attention: Money Market Division
Telephone: (212) 834-5070
Telecopier: (212) 834-6560
-31-
36
If to the Series 1998-1 Letter of Credit Provider:
Credit Suisse First Boston
Eleven Madison Avenue
New York, New York 10010-3629
Attention: Short and Medium-Term Finance Department
Telephone: (212) 325-7198
Telecopier: (212) 325-8183
If to Moody's:
Moody's Investors Service, Inc.
99 Church Street
New York, New York 10007
Attention: ABS Monitoring Department
Telephone: (212) 553-0300
Telecopier: (212) 553-4773
If to S&P:
Standard & Poor's Ratings Group
25 Broadway
New York, New York 10001
Attention: Asset-Backed Surveillance Group
Telephone: (212) 208-8000
Telecopier: (212) 412-0225
If to DCR:
Duff & Phelps Credit Rating Co.
55 East Monroe Street, Suite 3800
Chicago, IL 60603
Attention: John Bella
Telephone: (312) 368-2058
Telecopier: (312) 263-2852
-32-
37
If to the other Liquidity Lenders, at the addresses set forth below
their signatures on the signature pages of the Liquidity Agreement, as such
addresses may be revised from time to time by written notice from such
Liquidity Lenders.
SECTION 9.05. Fee; Costs and Expenses, etc. DTFC shall pay
to the Collateral Agent as its fee for its services the amounts (which amounts
are subject to change as circumstances warrant) as set forth in the Fee Letter
set forth as Exhibit A hereto. DTFC hereby agrees to reimburse the Collateral
Agent for all reasonable out-of-pocket costs and expenses (including reasonable
counsel fees and expenses, but excluding costs and expenses solely attributable
to administrative overhead) incurred by the Collateral Agent in connection with
the administration and enforcement of this Collateral Agreement and agrees to
indemnify and hold harmless the Collateral Agent, the Depositary, the Liquidity
Agent and the Liquidity Lenders (which in each case for purposes of this
Section 9.05 shall include their respective officers, directors, employees and
agents) from and against any and all losses (other than loss of profit),
liabilities (including liabilities for penalties), actions, suits, judgments,
demands, reasonable out-of-pocket costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses but excluding costs and
expenses attributable solely to administrative overhead) incurred by the
Collateral Agent (in its capacity as Collateral Agent), the Depositary, the
Liquidity Lenders or the Liquidity Agent in connection with the administration
or enforcement of this Collateral Agreement and also agrees to pay, indemnify,
and to hold each Liquidity Lender, the Collateral Agent, the Liquidity Agent
and the Depositary harmless from, any and all recording and filing fees and any
and all liabilities with respect to, or resulting from any delay in paying,
stamp and other taxes, if any, which may be payable or determined to be payable
in connection with the execution and delivery of, or consummation of any of the
transactions contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, this Collateral Agreement;
provided, however, that DTFC shall not be required to indemnify any Secured
Party for any such loss, liability, action, suit, judgment, demand, cost or
expense due to willful misconduct or gross negligence on the part of such
Secured Party or its respective agents or employees. If DTFC shall fail to do
any act or thing which it has covenanted to do hereunder or any representation
or warranty on the part of DTFC contained herein or repeated and reaffirmed
herein shall be breached, the Collateral Agent may, with the consent of the
Required Liquidity Providers, but shall not be required to, do the same or
cause it to be done or remedy any such breach, and may expend its funds for
such purpose. Any and all amounts so expended by the Collateral Agent shall be
repayable to it by DTFC upon the Collateral Agent's demand therefor. The
obligations of DTFC under this Section 9.05 shall survive the termination of
this Collateral Agreement, the resignation or removal of any of the Secured
Parties and the discharge of the other obligations of DTFC hereunder and shall
also survive the termination of the Aggregate Liquidity Commitment of the
Liquidity Lenders and the termination of the Series 1998-1 Letter of Credit in
accordance with the provisions of the Liquidity Agreement and of the Series
1998-1 Letter of Credit, respectively.
-33-
38
SECTION 9.06. Collateral Agent Appointed Attorney-in-Fact.
DTFC hereby appoints the Collateral Agent its attorney-in-fact, with full power
of substitution, for the purpose of taking such action (including, without
limitation any action pursuant to Section 4.03 hereof) and executing
agreements, instruments and other documents, in the name of DTFC, as the
Collateral Agent or the Required Liquidity Providers may deem necessary or
advisable to accomplish the purposes hereof, which appointment is coupled with
an interest and is irrevocable.
SECTION 9.07. Termination; Assigned Collateral. This
Collateral Agreement, and any grants, pledges and assignments hereunder, shall
terminate when (a) all DTFC Obligations shall have been fully paid and
satisfied, (b) the Aggregate Liquidity Commitment of the Liquidity Lenders
under the Liquidity Agreement, the Series 1998-1 Letter of Credit Commitment
and related documents have terminated, and (c) the Series 1998-1 Letter of
Credit shall have terminated, at which time the Collateral Agent, at the
written request of DTFC and upon receipt of a certificate from DTFC to the
effect that the conditions in clauses (a), (b) and (c) above have been complied
with and upon receipt of a certificate from the Liquidity Agent and the
Depositary to the effect that the conditions in clauses (a), (b) and (c)
relating to DTFC Obligations to the Liquidity Lenders and the Holders of
Commercial Paper Notes have been complied with, shall reassign (without
recourse upon, or any warranty whatsoever by, the Collateral Agent), deliver at
DTFC's expense all Assigned Collateral and documents then in the custody or
possession of the Collateral Agent promptly to DTFC and execute such documents
and instruments as DTFC may reasonably request in connection with such
reassignment.
DTFC and the Secured Parties hereby agree that, if any Deposited Funds
remain on deposit in the Collateral Account after the termination of this
Collateral Agreement, such amounts shall be released by the Collateral Agent
and paid to DTFC.
SECTION 9.08. Governing Law; Binding Character; Assignment.
THIS COLLATERAL AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO OTHERWISE APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW. This Collateral Agreement shall be binding
upon and shall inure to the benefit of DTFC, the Liquidity Lenders, the
Liquidity Agent, the Depositary, the Holders of Commercial Paper Notes and the
Collateral Agent, and their respective successors and assigns; provided,
however, that DTFC may not assign any of its right hereunder or in connection
herewith or any interest herein (voluntarily, by operation of law or otherwise)
without the prior written consent of all of the Liquidity Lenders. This
Collateral Agreement shall not be construed so as to confer any right or
benefit upon any Person other than the parties to this Collateral Agreement,
the Liquidity Lenders and the Holders of the Commercial Paper Notes and each of
their respective successors and assigns.
-34-
39
SECTION 9.09. Severability of Provisions. Any provision of
this Collateral Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
SECTION 9.10. No Bankruptcy Petition Against DTFC. Each of
the Secured Parties hereby covenants and agrees that, prior to the date which
is one year and one day after the payment in full of the latest maturing
Commercial Paper Note, it will not institute against, or join with any other
Person in instituting against, DTFC, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any Federal or state bankruptcy or similar law; provided, however, that nothing
in this Section 9.10 shall constitute a waiver of any right to indemnification,
reimbursement or other payment from DTFC pursuant to this Collateral Agreement.
In the event that any such Secured Party takes action in violation of this
Section 9.10, DTFC agrees that it shall file an answer with the bankruptcy or
otherwise properly contest the filing of such a petition by any such Secured
Party against DTFC or the commencement of such action and raise the defense
that such Secured Party has agreed in writing not to take such action and
should be estopped and precluded therefrom and such other defenses, if any, as
its counsel advises that it may assert. The provisions of this Section 9.10
shall survive the termination of this Collateral Agreement, and the resignation
or removal of the Collateral Agent, the Liquidity Agent or the Depositary.
Nothing contained herein shall preclude participation by any Secured Party in
assertion or defense of its claims in any such proceeding involving DTFC.
SECTION 9.11. No Recourse. The obligations of DTFC under
this Collateral Agreement are solely the corporate obligations of DTFC. No
recourse shall be had for the payment of any amount owing in respect of Section
9.05 hereof or for the payment of any fee hereunder or any other obligation or
claim arising out of or based upon this Collateral Agreement against any
stockholder, employee, officer, director, Affiliate or incorporator of DTFC;
provided, however, that nothing in this Section 9.11 shall relieve any of the
foregoing Persons from any liability which such Person may otherwise have for
its gross negligence or willful misconduct. The provisions of this Section
9.11 shall survive the termination of this Collateral Agreement.
SECTION 9.12. Confidentiality. Each party hereto (other
than DTFC) agrees that it shall not disclose any Confidential Information to
any Person without the prior written consent of RCFC or DTFC. Notwithstanding
anything herein to the contrary, the foregoing shall not be construed to
prohibit any party hereto from (i) disclosing any and all information that is
or becomes publicly known through no fault of a Secured Party, (ii) disclosure
of any and all information (which makes reference to RCFC or DTFC or this
transaction) obtained by any Secured Party from sources (other than RCFC or
DTFC) that have not notified the Secured Party or Parties that such information
is subject to a confidentiality obligation with RCFC or
-35-
40
DTFC (iii) disclosing any and all information (A) if required to do so by any
applicable statute, law, rule or regulation, (B) to any government agency or
regulatory body having or claiming authority to regulate or oversee any aspects
of a Secured Party's business or that of its Affiliates, (C) pursuant to any
subpoena, civil investigative demand or similar demand or request of any court,
regulatory authority, arbitrator or arbitration to which any Secured Party or
an Affiliate or an officer, director or employee thereof is a party, (D) in any
preliminary or final offering circular, registration statement or contract or
other document pertaining to the transactions contemplated herein approved in
advance by RCFC or DTFC or (E) to any Affiliate, independent or internal
auditor, agent, employee or attorney of any Secured Party having a need to know
the same, provided that the Secured Party advises such recipient of the
confidential nature of the information being disclosed or (iv) any other
disclosure authorized by RCFC or DTFC.
"Confidential Information" means information that RCFC or DTFC
furnishes to a Secured Party on a confidential basis, but does not include any
such information that is or becomes generally available to the public other
than as a result of a disclosure by such Secured Party or other person to which
Secured Party delivered such information or that is or becomes available to
such Secured Party from a source other than RCFC or DTFC, provided that such
source is not (1) known to such Secured Party to be bound by a confidentiality
agreement with RCFC or DTFC, as the case may be, or (2) known to such Secured
Party to be otherwise prohibited from transmitting the information by a
contractual, legal or fiduciary obligation.
SECTION 9.13. Headings. Article and Section headings used
in this Collateral Agreement are for convenience of reference only and shall
not affect the construction of this Collateral Agreement.
SECTION 9.14. Execution in Counterparts. This Collateral
Agreement may be executed in any number of counterparts and by different
parties hereto on separate counterparts, each of which counterparts, when so
executed and delivered, shall be deemed to be an original and all of which
counterparts, taken together, shall constitute one and the same Collateral
Agreement.
SECTION 9.15. Limited Recourse to DTFC. The Collateral
Agent agrees that the obligations of DTFC to the Collateral Agent hereunder
shall be payable in the order and priority set forth in Section 2.01 and
5.02(b), as applicable, of this Collateral Agreement. Such obligations shall
be due and payable only to the extent that DTFC's assets and the Series 1998-1
Letter of Credit Commitment are sufficient to pay such obligations. No claims
of the Collateral Agent arising under or in connection with this Collateral
Agreement are intended to be impaired or waived by this Section 9.15.
SECTION 9.16. Waiver of Set-Off With Respect to DTFC. Each
of the Collateral Agent, the Depositary, the Series 1998-1 Letter of Credit
Provider and the Liquidity Agent
-36-
41
hereby waives and relinquishes any right (other than for its fees and expenses)
that it has or may have to set-off or to exercise any banker's lien or any
right of attachment or garnishment with respect to any funds at any time and
from time to time on deposit in, or otherwise to the credit of, any account and
any claims of DTFC therein or with respect to any right to payment from DTFC,
it being understood, however, that nothing contained in this Section 9.16
shall, or is intended to, derogate from the assignment and security interest
granted to the Collateral Agent under this Collateral Agreement or impair any
rights of the Secured Parties or the Collateral Agent hereunder or thereunder.
SECTION 9.17. Obligations of Collateral Agent Under the
Note Purchase Agreement. The Collateral Agent hereby acknowledges and agrees
to its duties and obligations set forth in the Note Purchase Agreement, as such
agreement may be amended, amended and restated, supplemented or otherwise
modified from time to time in accordance with the terms thereof.
[Remainder of Page Intentionally Blank]
-37-
42
IN WITNESS WHEREOF, the parties hereto have caused this Collateral
Agreement to be duly executed by their respective officers all as of the day
and year first above written.
DOLLAR THRIFTY FUNDING CORP.
By:
---------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON, as
Liquidity Agent and Series 1998-1
Letter of Credit Provider
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON CORPORATION,
as Dealer
By:
----------------------------------
Name:
Title:
43
EXHIBIT A
Fee Letter