Exhibit 10.2
 

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$2,375,000,000

CREDIT AGREEMENT
 
among
 
AVIS BUDGET HOLDINGS, LLC,
 
AVIS BUDGET CAR RENTAL, LLC,
as Borrower,
 
The Subsidiary Borrowers from Time to Time Parties Hereto,
 
The Several Lenders from Time to Time Parties Hereto,
 
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent
 
DEUTSCHE BANK SECURITIES INC.,
as Syndication Agent,
 
BANK OF AMERICA, N.A.,
CALYON NEW YORK BRANCH,
and
CITICORP USA, INC.,
as Documentation Agents,

and

WACHOVIA BANK, NATIONAL ASSOCIATION,
as Co-Documentation Agent
 
Dated as of April 19, 2006
 

JPMORGAN SECURITIES INC.
and
DEUTSCHE BANK SECURITIES INC.,
as Joint Lead Arrangers and Joint Bookrunners

 

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TABLE OF CONTENTS
 
Page

SECTION 1.
 
DEFINED TERMS
 
1
     
1.1 Defined Terms
 
1
     
1.2 Other Definitional Provisions
 
22
 
SECTION 2.
 
AMOUNT AND TERMS OF COMMITMENTS
 
23
     
2.1 Term Commitments
 
23
     
2.2 Procedure for Term Loan Borrowing
 
23
     
2.3 Repayment of Term Loans
 
23
     
2.4 Revolving Commitments
 
24
     
2.5 Procedure for Revolving Loan Borrowing
 
24
     
2.6 Swingline Commitment
 
25
     
2.7 Procedure for Swingline Borrowing; Refunding of Swingline Loans
 
25
     
2.8 Commitment Fees, etc.
 
26
     
2.9 Termination or Reduction of Revolving Commitments
 
27
     
2.10 Optional Prepayments
 
27
     
2.11 Mandatory Prepayments
 
27
     
2.12 Conversion and Continuation Options
 
28
     
2.13 Limitations on Eurocurrency Tranches
 
28
     
2.14 Interest Rates and Payment Dates
 
29
     
2.15 Computation of Interest and Fees
 
29
     
2.16 Inability to Determine Interest Rate
 
29
     
2.17 Pro Rata Treatment and Payments
 
30
     
2.18 Requirements of Law
 
31
     
2.19 Taxes
 
32
     
2.20 Indemnity
 
34
     
2.21 Change of Lending Office
 
34
     
2.22 Replacement of Lenders
 
34
     
2.23 New Local Facilities
 
35
     
2.24 Prepayments Required Due to Currency Fluctuation
 
36
 
SECTION 3.
 
LETTERS OF CREDIT
 
36
     
3.1 L/C Commitment
         
3.2 Procedure for Issuance of Letter of Credit
 
36
     
3.3 Fees and Other Charges
 
36
     
3.4 L/C Participations
 
37
     
3.5 Reimbursement Obligation of the Borrower
 
38
     
3.6 Obligations Absolute
 
38
     
3.7 Letter of Credit Payments
 
38
     
3.8 Applications
 
38
     
3.9 Existing Letters of Credit
 
39
 
SECTION 4.
 
REPRESENTATIONS AND WARRANTIES
 
39
     
4.1 Financial Condition
 
39
 

 

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4.2 No Change
 
39
     
4.3 Existence; Compliance with Law
 
39
     
4.4 Power; Authorization; Enforceable Obligations
 
40
     
4.5 No Legal Bar
 
40
     
4.6 Litigation
 
40
     
4.7 No Default
 
40
     
4.8 Ownership of Property; Liens
 
40
     
4.9 Intellectual Property
 
40
     
4.10 Taxes
 
41
     
4.11 Federal Regulations
 
41
     
4.12 ERISA
 
41
     
4.13 Investment Company Act; Other Regulations
 
41
     
4.14 Subsidiaries
 
41
     
4.15 Use of Proceeds
 
42
     
4.16 Accuracy of Information, etc
 
42
     
4.17 Security Documents
 
42
     
4.18 Certain Documents
 
42
 
SECTION 5.
 
CONDITIONS PRECEDENT
 
43
     
5.1 Conditions to Initial Extension of Credit
 
43
     
5.2 Conditions to Each Extension of Credit
 
44
 
SECTION 6.
 
AFFIRMATIVE COVENANTS
 
45
     
6.1 Financial Statements
 
45
     
6.2 Certificates; Other Information
 
45
     
6.3 Payment of Obligations
 
46
     
6.4 Maintenance of Existence; Compliance
 
46
     
6.5 Maintenance of Property; Insurance
 
47
     
6.6 Inspection of Property; Books and Records; Discussions
 
47
     
6.7 Notices
 
47
     
6.8 Environmental Laws
 
48
     
6.9 Additional Collateral, etc
 
48
 
SECTION 7.
 
NEGATIVE COVENANTS
 
49
     
7.1 Financial Condition Covenants
 
49
     
7.2 Indebtedness
 
50
     
7.3 Liens
 
51
     
7.4 Fundamental Changes
 
53
     
7.5 Disposition of Property
 
53
     
7.6 Restricted Payments
 
54
     
7.7 Investments
 
54
     
7.8 Optional Payments and Modifications of Certain Agreements
 
55
     
7.9 Transactions with Affiliates
 
56
     
7.10 Sales and Leasebacks
 
56
     
7.11 Changes in Fiscal Periods
 
56
     
7.12 Clauses Restricting Subsidiary Distributions
 
56
     
7.13 Lines of Business
 
56
     
7.14 Business Activities of Holdings
 
56
 

 

 

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SECTION 8.
 
EVENTS OF DEFAULT
 
57
 
SECTION 9.
 
THE AGENTS
 
59
     
9.1 Appointment
 
59
     
9.2 Delegation of Duties
 
60
     
9.3 Exculpatory Provisions
 
60
     
9.4 Reliance by Administrative Agent
 
60
     
9.5 Notice of Default
 
61
     
9.6 Non-Reliance on Agents and Other Lenders
 
61
     
9.7 Indemnification
 
61
     
9.8 Agent in Its Individual Capacity
 
62
     
9.9 Successor Administrative Agent
 
62
     
9.10 Co-Documentation Agents and Syndication Agent
 
62
 
SECTION 10.
 
MISCELLANEOUS
 
62
     
10.1 Amendments and Waivers
 
62
     
10.2 Notices
 
64
     
10.3 No Waiver; Cumulative Remedies
 
65
     
10.4 Survival of Representations and Warranties
 
65
     
10.5 Payment of Expenses and Taxes
 
65
     
10.6 Successors and Assigns; Participations and Assignments
 
66
     
10.7 Adjustments; Set-off
 
69
     
10.8 Counterparts
 
69
     
10.9 Severability
 
69
     
10.10 Integration
 
70
     
10.11 GOVERNING LAW
 
70
     
10.12 Submission To Jurisdiction; Waivers
 
70
     
10.13 Judgment
 
70
     
10.14 Acknowledgements
 
71
     
10.15 Releases of Guarantees and Liens
 
71
     
10.16 Confidentiality
 
71
     
10.17 WAIVERS OF JURY TRIAL
 
72
     
10.18 USA Patriot Act
 
72
 

 

 

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SCHEDULES:
 

 
1.1A
 
Commitments
 
1.1B 
 
Excluded Subsidiaries
 
1.1C
 
Mandatory Costs
 
1.1D
 
Separation Agreement
 
1.1E
 
Tax Sharing Agreement
 
3.9
 
Existing Letters of Credit
 
4.4
 
Consents, Authorizations, Filings and Notices
 
4.9
 
Intellectual Property Matters
 
4.14
 
Subsidiaries
 
4.17 
 
UCC Filing Jurisdictions
 
7.2(f)
 
Existing Indebtedness
 
7.3(g)
 
Existing Liens
 
7.5(h)
 
Dispositions
 
7.7(k)
 
Investments
 
7.9
 
Permitted Transactions
 
7.12
 
Certain Agreements

 

 
EXHIBITS:
 

 
A
 
Form of Guarantee and Collateral Agreement
 
B
 
Form of Compliance Certificate
 
C
 
Form of Closing Certificate
 
D
 
Form of Assignment and Assumption
 
E
 
Form of Legal Opinion of Skadden, Arps, Slate, Meagher & Flom LLP
 
F
 
Form of Exemption Certificate
 
G
 
Form of Joinder

 

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CREDIT AGREEMENT (this “Agreement”), dated as of April 19, 2006, among AVIS
BUDGET HOLDINGS, LLC, a Delaware limited liability company (“Holdings”), AVIS
BUDGET CAR RENTAL, LLC, a Delaware limited liability company (the “Borrower”),
the Subsidiary Borrowers (as defined herein) from time to time parties hereto,
the several banks and other financial institutions or entities from time to time
parties hereto (the “Lenders”), DEUTSCHE BANK SECURITIES INC., as syndication
agent (in such capacity, the “Syndication Agent”), BANK OF AMERICA, N.A., CALYON
NEW YORK BRANCH and CITICORP USA, INC., as documentation agents (in such
capacity, the “Documentation Agents”), WACHOVIA BANK, NATIONAL ASSOCIATION, as
co-documentation agent (in such capacity, the “Co-Documentation Agent”), and
JPMORGAN CHASE BANK, N.A., as administrative agent.
 
The parties hereto hereby agree as follows:
 
SECTION 1.  DEFINITIONS
1.1   Defined Terms. As used in this Agreement, the terms listed in this Section
1.1 shall have the respective meanings set forth in this Section 1.1.
 
“ABR”: for any day, a rate per annum (rounded upwards, if necessary, to the next
1/16 of 1%) equal to the greater of (a) the Prime Rate in effect on such day and
(b) the Federal Funds Effective Rate in effect on such day plus ½ of 1%. For
purposes hereof: “Prime Rate” shall mean the rate of interest per annum publicly
announced from time to time by JPMorgan Chase Bank as its prime rate in effect
at its principal office in New York City (the Prime Rate not being intended to
be the lowest rate of interest charged by JPMorgan Chase Bank in connection with
extensions of credit to debtors). Any change in the ABR due to a change in the
Prime Rate or the Federal Funds Effective Rate shall be effective as of the
opening of business on the effective day of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.
 
“ABR Loans”: Loans the rate of interest applicable to which is based upon the
ABR.
 
“AESOP Financing Program”: the transactions contemplated by that certain Second
Amended and Restated Base Indenture, dated as of June 3, 2004, between Cendant
Rental Car Funding (AESOP) LLC (formally known as AESOP Funding II L.L.C.), as
issuer and The Bank of New York, as trustee, as it may be from time to time
further amended, supplemented or modified, and the instruments and agreements
referenced therein and otherwise executed in connection therewith, and any
successor program.
 
“AESOP Indebtedness”: any Indebtedness incurred pursuant to the AESOP Financing
Program.
 
“Administrative Agent”: JPMorgan Chase Bank, together with its affiliates, as
the arranger of the Commitments and as the administrative agent for the Lenders
under this Agreement and the other Loan Documents, together with any of its
successors.
 
“Affiliate”: as to any Person, any other Person which, directly or indirectly,
is in control of, is controlled by, or is under common control with, such
Person. For purposes of this definition, a Person shall be deemed to be
“controlled by” another if such latter Person possesses, directly or indirectly,
power either to (i) vote 10% or more of the securities having ordinary voting
power for the election of directors of such controlled Person or (ii) direct or
cause the direction of the management and policies of such controlled Person
whether by contract or otherwise.
 
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“Agents”: the collective reference to the Syndication Agent, the Documentation
Agents, the Co-Documentation Agent and the Administrative Agent.
 
“Aggregate Exposure”: with respect to any Lender at any time, an amount equal to
(a) until the Closing Date, the aggregate amount of such Lender’s Commitments at
such time and (b) thereafter, the sum of (i) the aggregate then unpaid principal
amount of such Lender’s Term Loans and (ii) the amount of such Lender’s
Revolving Commitment then in effect or, if the Revolving Commitments have been
terminated, the amount of such Lender’s Revolving Extensions of Credit then
outstanding.
 
“Aggregate Exposure Percentage”: with respect to any Lender at any time, the
ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such
time to the Aggregate Exposure of all Lenders at such time.
 
“Agreement”: as defined in the preamble hereto.
 
“Applicable Margin”: (a) with respect to Term Loans, (i) 0.25% in the case of
ABR Loans and (ii) 1.25% in the case of Eurocurrency Loans and (b) with respect
to Revolving Loans and Swingline Loans, the rate per annum set forth under the
relevant column heading in the Pricing Grid.
 
“Application”: an application, in such form as the Issuing Lender may specify
from time to time, requesting the Issuing Lender to open a Letter of Credit.
 
“Approved Fund”: as defined in Section 10.6(b).
 
“Asset Sale”: any Disposition of property or series of related Dispositions of
property (excluding any such Disposition permitted by clause (a), (b), (c), (d)
or (e) of Section 7.5) that yields gross proceeds to any Loan Party (valued at
the initial principal amount thereof in the case of non-cash proceeds consisting
of notes or other debt securities and valued at fair market value in the case of
other non-cash proceeds) in excess of $25,000,000.
 
“Assignee”: as defined in Section 10.6(b).
 
“Assignment and Assumption”: an Assignment and Assumption, substantially in the
form of Exhibit D.
 
“Australian Dollars” and “A$”: the lawful money of Australia.
 
“Available Revolving Commitment”: as to any Revolving Lender at any time, an
amount equal to the excess, if any, of (a) such Lender’s Revolving Commitment
then in effect over (b) such Lender’s Revolving Extensions of Credit then
outstanding; provided, that in calculating any Lender’s Revolving Extensions of
Credit for the purpose of determining such Lender’s Available Revolving
Commitment pursuant to Section 2.8(a), the aggregate principal amount of
Swingline Loans then outstanding shall be deemed to be zero.
 
“Avis Budget Finance”: Avis Budget Finance, Inc., a Delaware corporation.
 
“Benefitted Lender”: as defined in Section 10.7(a).
 
“Board”: the Board of Governors of the Federal Reserve System of the United
States (or any successor).
 
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“Borrower”: as defined in the preamble hereto.
 
“Borrowing Date”: any Business Day specified by the Borrower or any Subsidiary
Borrower as a date on which the Borrower or such Subsidiary Borrower requests
the relevant Lenders to make Loans hereunder.
 
“Budget”: as defined in Section 6.2(c).
 
“Budget Truck Division”: the truck rental business of Budget Rent A Car System,
Inc. and its Subsidiaries.
 
“Business Day”: any day other than a Saturday, Sunday or other day on which
banks in the State of New York are permitted to close; provided, however, that
when used in connection with a Eurocurrency Loan, the term “Business Day” shall
also exclude any day on which banks are not open for dealings in Dollar deposits
or deposits in any Optional Currency, as applicable, in the London Interbank
market.
 
“Canadian Dollars” and “C$”: the lawful money of Canada.
 
“Capital Lease Obligations”: as to any Person, the obligations of such Person to
pay rent or other amounts under any lease of (or other arrangement conveying the
right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP and, for the purposes of this
Agreement, the amount of such obligations at any time shall be the capitalized
amount thereof at such time determined in accordance with GAAP.
 
“Capital Stock”: any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation) and any
and all warrants, rights or options to purchase any of the foregoing.
 
“Cash Equivalents”: any of the following, to the extent acquired for investment
and not with a view to achieving trading profits: (i) obligations fully backed
by the full faith and credit of the United States of America maturing not in
excess of twelve months from the date of acquisition, (ii) commercial paper
maturing not in excess of twelve months from the date of acquisition and rated
at least “P-1” by Moody’s or “A-1” by S&P on the date of such acquisition, (iii)
the following obligations of any Lender or any domestic commercial bank having
capital and surplus in excess of $500,000,000, which has, or the holding company
of which has, a commercial paper rating meeting the requirements specified in
clause (ii) above: (a) time deposits, certificates of deposit and acceptances
maturing not in excess of twelve months from the date of acquisition, or (b)
repurchase obligations with a term of not more than thirty days for underlying
securities of the type referred to in clause (i) above, (iv) money market funds
that invest exclusively in interest bearing, short-term money market instruments
and adhere to the minimum credit standards established by Rule 2a-7 of the
Investment Company Act of 1940, as amended, and (v) municipal securities: (a)
for which the pricing period in effect is not more than twelve months long and
(b) rated at least “P-1” by Moody’s or “A-1” by S&P.
 
“Cendant”: Cendant Corporation, a Delaware corporation.
 
“Change in Control”: (i) the acquisition by any Person or group (within the
meaning of the Securities Exchange Act of 1934, as amended, and the rules of the
SEC thereunder as in effect on the Closing Date), directly or indirectly,
beneficially or of record, of ownership or control of in excess of 50%
 
3

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of the voting common stock of Cendant on a fully diluted basis at any time or
(ii) if at any time, individuals who at the Closing Date constituted the Board
of Directors of Cendant (together with any new directors whose election by such
Board of Directors or whose nomination for election by the shareholders of
Cendant, as the case may be, was approved by a vote of the majority of the
directors then still in office who were either directors at the Closing Date or
whose election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors of Cendant, (iii)
Cendant shall cease to own, directly or through one or more Wholly-Owned
Subsidiaries, all of the capital stock of Holdings, free and clear of any direct
or indirect Liens (other than statutory Liens) or (iv) Holdings shall cease to
directly own all of the capital stock of the Borrower, free and clear of any
direct or indirect Liens (other than statutory Liens or Liens created by the
Loan Documents). Notwithstanding anything to the contrary contained in this
definition, the consummation of the Spin-Off Transactions shall not result in a
Change in Control.
 
“Closing Date”: the date on which the conditions precedent set forth in Section
5.1 shall have been satisfied, which date is April 19, 2006.
 
“Code”: the Internal Revenue Code of 1986, as amended from time to time.
 
“Co-Documentation Agent”: as defined in the preamble hereto.
 
“Collateral”: all property of the Loan Parties, now owned or hereafter acquired,
upon which a Lien is purported to be created by any Security Document, provided,
however, that Collateral shall not include the assets of any Foreign Subsidiary
or more than 66% of the voting Capital Stock of any Foreign Subsidiary.
 
“Commitment”: as to any Lender, the sum of the Term Commitment and the Revolving
Commitment of such Lender.
 
“Commitment Fee Rate”: the rate per annum set forth under the relevant column
heading in the Pricing Grid.
 
“Commonly Controlled Entity”: an entity, whether or not incorporated, that is
under common control with the Borrower within the meaning of Section 4001 of
ERISA or is part of a group that includes the Borrower and that is treated as a
single employer under Section 414 of the Code.
 
“Compliance Certificate”: a certificate duly executed by a Responsible Officer
substantially in the form of Exhibit B.
 
“Collateralized”: secured by cash collateral arrangements and/or backstop
letters of credit entered into on terms and in amounts reasonably satisfactory
to the Administrative Agent and the relevant Issuing Lender.
 
“Conduit Lender”: any special purpose corporation organized and administered by
any Lender for the purpose of making Loans otherwise required to be made by such
Lender and designated by such Lender in a written instrument; provided, that the
designation by any Lender of a Conduit Lender shall not relieve the designating
Lender of any of its obligations to fund a Loan under this Agreement if, for any
reason, its Conduit Lender fails to fund any such Loan, and the designating
Lender (and not the Conduit Lender) shall have the sole right and responsibility
to deliver all consents and waivers required or requested under this Agreement
with respect to its Conduit Lender, and provided, further, that no Conduit
Lender shall (a) be entitled to receive any greater amount pursuant to Section
2.18, 2.19, 2.20 or 10.5 than
 
4

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the designating Lender would have been entitled to receive in respect of the
extensions of credit made by such Conduit Lender or (b) be deemed to have any
Commitment.
 
“Confidential Information Memorandum”: the Confidential Information Memorandum
dated March 2006 and furnished to certain Lenders.
 
“Consolidated EBITDA”: without duplication, for any period, Consolidated Net
Income plus (a) provision for taxes based on income, (b) depreciation expense
(excluding any such expense attributable to depreciation of Eligible Assets),
(c) Consolidated Total Interest Expense, (d) amortization expense (excluding any
such expense attributable to amortization of Eligible Assets), (e) non-cash
stock option and restricted stock grant expense and (f) other extraordinary,
unusual or non-recurring items reducing Consolidated Net Income (and increasing
EBITDA), including fees, expenses and charges associated with the transactions
contemplated by the Separation Agreement, minus (plus) (i) any non-recurring
gains (losses) on business unit dispositions outside the ordinary course of
business if such gains (losses) are included in Consolidated Net Income) and
(ii) any cash expenditures during such period to the extent such cash
expenditures (x) did not reduce Consolidated Net Income for such period and (y)
were applied against reserves that constituted non-cash items which reduced
Consolidated Net Income during prior periods, all as determined on a
consolidated basis in accordance with GAAP. Notwithstanding the foregoing, in
calculating Consolidated EBITDA for any period, pro forma effect shall be given
to (1) each acquisition of a Subsidiary or any other entity acquired by any
Group Member in a merger where the purchase price or merger consideration, as
the case may be, exceeds $40,000,000 and (2) each Disposition of property
yielding gross proceeds in excess of $40,000,000 during such period as if such
acquisition or Disposition had been made on the first day of such period.
 
“Consolidated Financial Statements”: as defined in Section 4.1(b).
 
“Consolidated Interest Coverage Ratio”: for any period, the ratio of (a)
Consolidated EBITDA for such period to (b) Consolidated Interest Expense for
such period.
 
“Consolidated Interest Expense”: for any period, (a) total interest expense paid
or payable in cash (including that properly attributable to Capital Leases
Obligations, but excluding in any event (x) all capitalized interest and
amortization of debt discount and debt issuance costs and (y) debt
extinguishment costs) of the Borrower and its Subsidiaries on a consolidated
basis in accordance with GAAP including, without limitation, all commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers’ acceptance financing and net cash costs (or minus net profits) under
interest rate Swap Agreements minus, (b) without duplication, any interest
income of the Borrower and its Subsidiaries on a consolidated basis in
accordance with GAAP during such period (other than interest income earned on
any Related Eligible Assets). Notwithstanding the foregoing, interest expense in
respect of any (i) Securitization Indebtedness, (ii) AESOP Indebtedness or (iii)
Recourse Vehicle Indebtedness, in an amount up to $750,000,000, shall not be
included in Consolidated Interest Expense; provided that for any period when the
Consolidated Leverage Ratio is less than 3.25 to 1.0, interest expense on
Recourse Vehicle Indebtedness in an amount up to $850,000,000 shall not be
included in Consolidated Interest Expense. For purposes of calculating
Consolidated Interest Expense related to Recourse Vehicle Indebtedness, such
amount shall be equal to the product of:
 
Recourse Vehicle Indebtedness - $750,000,000 (or $850,000,000, as applicable)
x
total cash interest expense on Recourse Vehicle Indebtedness
Recourse Vehicle Indebtedness

 
“Consolidated Leverage Ratio”: as at the last day of any period, the ratio of
(a) Consolidated Total Debt on such day to (b) Consolidated EBITDA for such
period.
 
5

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“Consolidated Net Income”: for any period for which such amount is being
determined, the net income (or loss) of the Borrower and its Subsidiaries during
such period determined on a consolidated basis for such period taken as a single
accounting period in accordance with GAAP; provided that there shall be excluded
(i) income (loss) of any Person (other than a Subsidiary of the Borrower) in
which the Borrower or any of its Subsidiaries has any equity investment or
comparable interest, except to the extent of the amount of dividends or other
distributions actually paid to the Borrower or its Subsidiaries by such Person
during such period, (ii) the income of any Subsidiary of the Borrower to the
extent that the declaration or payment of dividends or similar distributions by
that Subsidiary of the income is not at the time permitted by operation of the
terms of its charter, or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Subsidiary, (iii)
any extraordinary after-tax gains and (iv) any extraordinary or unusual pretax
losses.
 
“Consolidated Total Debt”: at any date, the aggregate principal amount of all
Indebtedness of the Borrower and its Subsidiaries at such date, determined on a
consolidated basis in accordance with GAAP; provided that, for purposes of this
definition, Indebtedness shall not include (i)(x) Securitization Indebtedness,
(y) AESOP Indebtedness or (z) Recourse Vehicle Indebtedness up to $750,000,000;
provided that for any period when the Consolidated Leverage Ratio is less than
3.25 to 1.0, Recourse Vehicle Indebtedness up to $850,000,000 shall be excluded
from Consolidated Total Debt, (ii) the aggregate undrawn amount of outstanding
Letters of Credit, (iii) the aggregate undrawn amount of outstanding letters of
credit under the Letter of Credit Facilities or (iv) obligations under Swap
Agreements. In addition, for purposes of this definition, the amount of
Indebtedness at any time shall be reduced (but not to less than zero) by the
amount of Excess Cash.
 
“Consolidated Total Interest Expense”: for any period, without duplications (a)
total interest expense paid or payable in cash (including that properly
attributable to Capital Leases Obligations) plus, (b)(x) all capitalized
interest and amortization of debt discount and debt issuance costs and (y) debt
extinguishment costs, in each case, of the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP including, without limitation, all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers’ acceptance financing and net cash costs (or minus net
profits) under interest rate Swap Agreements minus, (c) without duplication, any
interest income of the Borrower and its Subsidiaries on a consolidated basis in
accordance with GAAP during such period (other than interest income earned on
any Related Eligible Assets). Notwithstanding the foregoing, interest expense in
respect of any (i) Securitization Indebtedness, (ii) AESOP Indebtedness or (iii)
Recourse Vehicle Indebtedness, in an amount up to $750,000,000, shall not be
included in Consolidated Total Interest Expense; provided that for any period
when the Consolidated Leverage Ratio is less than 3.25 to 1.0, interest expense
on Recourse Vehicle Indebtedness in an amount up to $850,000,000 shall not be
included in Consolidated Total Interest Expense. For purposes of calculating
Consolidated Total Interest Expense related to Recourse Vehicle Indebtedness,
such amount shall be equal to the product of:
 
Recourse Vehicle Indebtedness - $750,000,000 (or $850,000,000, as applicable)
x
total interest expense on Recourse Vehicle Indebtedness
Recourse Vehicle Indebtedness

 
“Contractual Obligation”: as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or other undertaking to which
such Person is a party or by which it or any of its property is bound.
 
“Currency”: Dollars or any Optional Currency.
 
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“Default”: any of the events specified in Section 8, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
 
“Disposition”: with respect to any property, any sale, lease, sale and
leaseback, assignment, conveyance, transfer or other disposition thereof. The
terms “Dispose” and “Disposed of” shall have correlative meanings.
 
“Documentation Agents”: as defined in the preamble hereto.
 
“Dollar Equivalent”: on any date of determination, (a) with respect to any
amount denominated in Dollars, such amount, and (b) with respect to an amount
denominated in any Optional Currency, the equivalent in Dollars of such amount
determined by the Administrative Agent in accordance with normal banking
industry practice using the Exchange Rate on the date of determination of such
equivalent. In making any determination of the Dollar Equivalent (for purposes
of calculating the amount of Loans to be borrowed from the respective Lenders on
any date or for any other purpose), the Administrative Agent shall use the
relevant Exchange Rate in effect on the date on which the Borrower or any
Subsidiary Borrower delivers a request for Revolving Loans or on such other date
upon which a Dollar Equivalent is required to be determined pursuant to the
provisions of this Agreement. As appropriate, amounts specified herein as
amounts in Dollars shall be or include any relevant Dollar Equivalent amount.
 
“Dollars” and “$”: the lawful money of the United States.
 
“Domestic Subsidiary”: any Subsidiary of the Borrower organized under the laws
of any jurisdiction within the United States.
 
“Domestic Subsidiary Borrower”: any Subsidiary Borrower which is a Domestic
Subsidiary.
 
“Eligible Assets”: any of the following and any proceeds thereof: (a) assets
(and interests in assets) that are of the type described as “assets under
vehicle programs” in the consolidated financial statements of the Borrower and
its Subsidiaries, dated December 31, 2005, which shall include, without
limitation, vehicles, vehicle leases, fleet maintenance contracts, fleet
management contracts, other service contracts, receivables generated by any of
the foregoing and other asset servicing rights, and (b) equity interests or
other securities issued by any Subsidiary or other Person issuing securities or
incurring Indebtedness secured by, payable from or representing beneficial
interests in, or holding title or ownership interests in, assets of the type
described in clause (a) above or interests in such assets.
 
“Environmental Laws”: all laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, judgments, injunctions, notices or requirements
issued, promulgated or entered into by any Governmental Authority, relating in
any way to the environment, preservation or reclamation of natural resources,
the management, release or threatened release of any Materials of Environmental
Concern or to health and safety matters, including without limitation, the Clean
Water Act also known as the Federal Water Pollution Control Act (“FWPCA”)
33 U.S.C. § 1251 et seq., the Clean Air Act (“CAA”), 42 U.S.C. §§ 7401 et seq.,
the Federal Insecticide, Fungicide and Rodenticide Act (“FIFRA”), 7 U.S.C.
§§ 136 et seq., the Surface Mining Control and Reclamation Act (“SMCRA”),
30 U.S.C. §§ 1201 et seq., the Comprehensive Environmental Response,
Compensation and Liability Act (“CERCLA”), 42 U.S.C. § 9601 et seq., the
Superfund Amendment and Reauthorization Act of 1986 (“SARA”), Public Law 99-499,
100 Stat. 1613, the Emergency Planning and Community Right to Know Act
(“ECPCRKA”), 42 U.S.C. § 11001 et seq., the Resource Conservation and Recovery
Act (“RCRA”), 42 U.S.C. § 6901 et seq., the Occupational Safety and Health Act
as amended (“OSHA”), 29 U.S.C. § 655 and § 657,
 
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together, in each case, with any amendment thereto, and the regulations adopted
and binding publications promulgated thereunder and all substitutions thereof.
 
“ERISA”: the Employee Retirement Income Security Act of 1974, as amended from
time to time.
 
“Euro” and “€”: the official currency of the European Union.
 
“Eurocurrency Base Rate”: with respect to each day during each Interest Period
pertaining to a Eurocurrency Loan, the rate per annum determined on the basis of
the rate for deposits in Dollars or the applicable Optional Currency for a
period equal to such Interest Period commencing on the first day of such
Interest Period appearing on the applicable page of the Telerate screen as of
11:00 A.M., London time, two Business Days prior to the beginning of such
Interest Period. In the event that such rate does not appear on such page of the
Telerate screen (or otherwise on such screen), the “Eurocurrency Base Rate”
shall be determined by reference to such other comparable publicly available
service for displaying eurocurrency rates for the applicable Currency as may be
selected by the Administrative Agent or, in the absence of such availability, by
reference to the rate at which the Administrative Agent is offered Dollar
deposits or deposits in the applicable Optional Currency at or about 11:00 A.M.,
New York City time, two Business Days prior to the beginning of such Interest
Period in the London interbank eurocurrency for delivery on the first day of
such Interest Period for the number of days comprised therein.
 
“Eurocurrency Loans”: Loans the rate of interest applicable to which is based
upon the Eurocurrency Rate.
 
“Eurocurrency Rate”: with respect to each day during each Interest Period
pertaining to a Eurocurrency Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th
of 1%):
 
Eurocurrency Base Rate
1.00 - Eurocurrency Reserve Requirements

; provided that with respect to any Eurocurrency Loan denominated in Euro or
Pounds Sterling, the Eurocurrency Rate shall the mean the Eurocurrency Base Rate
plus if applicable, as reasonably determined by the Administrative Agent in
accordance with Schedule 1.1C, the Mandatory Costs.
 
“Eurocurrency Reserve Requirements”: a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board and any other banking authority to which the
Administrative Agent or any Lender is subject, for Eurocurrency Liabilities (as
defined in Regulation D). Such reserve percentages shall include those imposed
under Regulation D. Eurocurrency Loans shall be deemed to constitute
Eurocurrency Liabilities and as such shall be deemed to be subject to such
reserve requirements without benefit of or credit for proration, exceptions or
offsets which may be available from time to time to any Lender under Regulation
D. Eurocurrency Reserve Requirements shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.
 
“Eurocurrency Tranche”: the collective reference to Eurocurrency Loans under a
particular Facility the then current Interest Periods with respect to all of
which begin on the same date and end on the same later date (whether or not such
Loans shall originally have been made on the same day).
 
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“Event of Default”: any of the events specified in Section 8, provided that any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
 
“Excess Cash”: all cash and Cash Equivalents of the Borrower and its
Subsidiaries at such time determined on a consolidated basis in accordance with
GAAP in excess of $25,000,000.
 
“Exchange Rate”: for any day with respect to any Optional Currency, the rate at
which such Optional Currency may be exchanged into Dollars, as set forth at
11:00 A.M., London time, on such day on the applicable Reuters currency page
with respect to such Optional Currency. In the event that such rate does not
appear on the applicable Reuters currency page, the Exchange Rate with respect
to such Optional Currency shall be determined by reference to such other
publicly available service for displaying exchange rates as may be agreed upon
by the Administrative Agent and the Borrower or, in the absence of such
agreement, such Exchange Rate shall instead be the spot rate of exchange of the
Administrative Agent in the London Interbank market or other market where its
foreign currency exchange operations in respect of such Optional Currency are
then being conducted, at or about 11:00 A.M., London time, on such day for the
purchase of Dollars with such Optional Currency, for delivery two Business Days
later; provided, however, that if at the time of any such determination, for any
reason, no such spot rate is being quoted, the Administrative Agent may use any
reasonable method it deems appropriate to determine such rate, and such
determination shall be conclusive absent manifest error.
 
“Excluded Subsidiary”: each Subsidiary listed on Schedule 1.1B and any other
Subsidiary so long as the Borrower or any Subsidiary of the Borrower does not
have the controlling authority under the organizational documents of such
Excluded Subsidiary to incur Indebtedness on its behalf or grant Liens on its
assets (other than purchase money security interests).
 
“Existing Letters of Credit”: as defined in Section 3.9.
 
“Facility”: each of (a) the Term Commitments and the Term Loans made thereunder
(the “Term Facility”) and (b) the Revolving Commitments and the extensions of
credit made thereunder (the “Revolving Facility”).
 
“Federal Funds Effective Rate”: for any day, the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average of the quotations for
the day of such transactions received by JPMorgan Chase Bank from three federal
funds brokers of recognized standing selected by it.
 
“Fee Payment Date”: (a) the third Business Day following the last day of each
March, June, September and December and (b) the last day of the Revolving
Commitment Period.
 
“Foreign Subsidiary”: any Subsidiary of the Borrower that is not a Domestic
Subsidiary.
 
“Foreign Subsidiary Borrower”: any Subsidiary Borrower that is not a Domestic
Subsidiary.
 
“Funding Office”: the office of the Administrative Agent specified in Section
10.2 or such other office as may be specified from time to time by the
Administrative Agent as its funding office by written notice to the Borrower and
the Lenders.
 
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“GAAP”: generally accepted accounting principles in the United States as in
effect from time to time.
 
“Governmental Authority”: any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, or any
federal, state or municipal court, in each case whether of the United States or
foreign.
 
“Group Members”: the collective reference to Holdings, the Borrower and their
respective Subsidiaries.
 
“Guarantee and Collateral Agreement”: the Guarantee and Collateral Agreement to
be executed and delivered by Holdings, the Borrower and each Subsidiary
Guarantor, substantially in the form of Exhibit A.
 
“Guarantee Obligation”: any obligation, contingent or otherwise, of the Person
guaranteeing or having the economic effect of guaranteeing any Indebtedness of
any other Person (the “primary obligor”) in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness (including reasonable fees and expenses related thereto)
or to purchase (or to advance or supply funds for the purchase of) any security
for the payment thereof, (b) to purchase or lease property, securities or
services for the purpose of assuring the owner of such Indebtedness of the
payment thereof, (c) to maintain working capital, equity capital or any other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness; provided, however, that the amount of any Guarantee Obligation
shall be limited to the extent necessary so that such amount does not exceed the
value of the assets of such Person (as reflected on a consolidated balance sheet
of such Person prepared in accordance with GAAP) to which any creditor or
beneficiary of such Guarantee Obligation would have recourse. Notwithstanding
the foregoing definition, the term “Guarantee Obligation” shall not include any
direct or indirect obligation of a Person as a general partner of a general
partnership or a joint venturer of a joint venture in respect of Indebtedness of
such general partnership or joint venture, to the extent such Indebtedness is
contractually non-recourse to the assets of such Person as a general partner or
joint venturer (other than assets comprising the capital of such general
partnership or joint venture). The term “Guarantee Obligation” shall not include
endorsements for collection or deposit in the ordinary course of business.
 
“Guarantors”: the collective reference to Holdings and the Subsidiary
Guarantors.
 
“Holdings”: as defined in the preamble hereto.
 
“Indebtedness”: of any Person at any date, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than
current trade payables incurred in the ordinary course of such Person’s
business), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party or applicant under or in respect of acceptances, letters of
credit, surety bonds or similar arrangements, (g) the liquidation value of all
mandatorily redeemable preferred Capital Stock of such Person, (h) all Guarantee
Obligations of such Person in respect of obligations of the kind referred to in
clauses (a) through (g) above, (i) all obligations of the kind referred to in
clauses (a) through
 
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(h) above secured by (or for which the holder of such obligation has an existing
right, contingent or otherwise, to be secured by) any Lien on property
(including accounts and contract rights) owned by such Person, whether or not
such Person has assumed or become liable for the payment of such obligation, and
(j) for the purposes of Section 8(e) only, all obligations of such Person in
respect of Swap Agreements. The Indebtedness of any Person shall include the
Indebtedness of any other entity (including any partnership in which such Person
is a general partner) to the extent such Person is liable therefor as a result
of such Person’s ownership interest in or other relationship with such entity,
except to the extent the terms of such Indebtedness expressly provide that such
Person is not liable therefor.
 
“Insolvency”: with respect to any Multiemployer Plan, the condition that such
Plan is insolvent within the meaning of Section 4245 of ERISA.
 
“Insolvent”: pertaining to a condition of Insolvency.
 
“Intellectual Property”: the collective reference to all rights, priorities and
privileges with respect to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including copyrights,
copyright licenses, patents, patent licenses, trademarks, trademark licenses,
technology, know-how and processes, and all rights to sue at law or in equity
for any infringement or other impairment thereof, including the right to receive
all proceeds and damages therefrom.
 
“Interest Payment Date”: (a) as to any ABR Loan (other than any Swingline Loan),
the last day of each March, June, September and December to occur while such
Loan is outstanding and the final maturity date of such Loan, (b) as to any
Eurocurrency Loan having an Interest Period of three months or less, the last
day of such Interest Period, (c) as to any Eurocurrency Loan having an Interest
Period longer than three months, each day that is three months, or a whole
multiple thereof, after the first day of such Interest Period and the last day
of such Interest Period, (d) as to any Loan (other than any Revolving Loan that
is an ABR Loan and any Swingline Loan), the date of any repayment or prepayment
made in respect thereof and (e) as to any Swingline Loan, the day that such Loan
is required to be repaid.
 
“Interest Period”: as to any Eurocurrency Loan, (a) initially, the period
commencing on the borrowing or conversion date, as the case may be, with respect
to such Eurocurrency Loan and ending one, two, three or six (or, if agreed to by
all Lenders under the relevant Facility, nine or twelve) months thereafter, as
selected by the Borrower or relevant Subsidiary Borrower in its notice of
borrowing or notice of conversion, as the case may be, given with respect
thereto; and (b) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such Eurocurrency Loan and ending one,
two, three or six (or, if agreed to by all Lenders under the relevant Facility,
nine or twelve) months thereafter, as selected by the Borrower or relevant
Subsidiary Borrower by irrevocable notice to the Administrative Agent not later
than 12:00 Noon, New York City time, on the date that is three Business Days
prior to the last day of the then current Interest Period with respect thereto;
provided that, all of the foregoing provisions relating to Interest Periods are
subject to the following:
 
(i)   if any Interest Period would otherwise end on a day that is not a Business
Day, such Interest Period shall be extended to the next succeeding Business Day
unless the result of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period shall end on the
immediately preceding Business Day;
 
(ii)   the Borrower or relevant Subsidiary Borrower may not select an Interest
Period under a particular Facility that would extend beyond the Revolving
Termination Date or beyond the date final payment is due on the Term Loans;
 
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(iii)   any Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
 
(iv)   the Borrower and any relevant Subsidiary Borrower shall select Interest
Periods so as not to require a payment or prepayment of any Eurocurrency Loan
during an Interest Period for such Loan.
 
“Investments”: as defined in Section 7.7.
 
“Issuing Lender”: JPMorgan Chase Bank or any affiliate thereof and such other
Lenders or affiliates thereof as may be designated in writing by the Borrower
which agree in writing to act as such in accordance with the terms hereof and
are reasonably acceptable to the Administrative Agent (including the issuer of
any Existing Letters of Credit), in the capacity as issuer of any Letter of
Credit.
 
“JPMorgan Chase Bank”: JPMorgan Chase Bank, N.A.
 
“judgment currency”: as defined in Section 10.13.
 
“L/C Obligations”: at any time, an amount equal to the sum of (a) the aggregate
then undrawn and unexpired amount of the then outstanding Letters of Credit and
(b) the aggregate amount of drawings under Letters of Credit that have not then
been reimbursed pursuant to Section 3.5.
 
“L/C Participants”: the collective reference to all the Revolving Lenders other
than the Issuing Lender.
 
“Lenders”: as defined in the preamble hereto; provided, that unless the context
otherwise requires, each reference herein to the Lenders shall be deemed to
include any Conduit Lender.
 
 
“Letter of Credit Facilities”: the Cendant letter of credit facilities, dated as
of July 2, 2004, as such agreements may be amended, supplemented and amended and
restated from time to time.
 
“Letters of Credit”: as defined in Section 3.1(a).
 
“Lien”: with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such asset and (b) the interest of a vendor or a lessor under any conditional
sale agreement, capital lease or title retention agreement (or any financing
lease having substantially the same economic effect as any of the foregoing)
relating to such asset.
 
“Loan”: any loan made by any Lender pursuant to this Agreement.
 
“Loan Documents”: this Agreement, the Security Documents, the Notes and any
amendment, waiver, supplement or other modification to any of the foregoing.
 
“Loan Parties”: each Group Member that is a party to a Loan Document.
 
“Local Facility Amendment”: as defined in Section 2.23.
 
“Majority Facility Lenders”: with respect to any Facility, the holders of more
than 50% of the aggregate unpaid principal amount of the Term Loans or the Total
Revolving Extensions of Credit,
 
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as the case may be, outstanding under such Facility (or, in the case of the
Revolving Facility, prior to any termination of the Revolving Commitments, the
holders of more than 50% of the Total Revolving Commitments).
 
“Material Adverse Effect”: any event, development or circumstance that has had
or could reasonably be expected to have a material adverse effect on (i) the
business, operations, property or condition (financial or otherwise) of the
Borrower and its Subsidiaries taken as a whole (it being understood that a
bankruptcy filing by, or change in the actual or perceived credit quality of, or
work stoppage affecting any “big three” auto manufacturer shall not constitute a
Material Adverse Effect so long as such “big three” auto manufacturer has not
failed to perform its material performance obligations owed to the Borrower or
any of its Subsidiaries) or (ii) the validity or enforceability of this
Agreement or any of the other Loan Documents or the rights and remedies of the
Administrative Agent or the Lenders hereunder or thereunder; provided that on
the date of making the initial extensions of credit under this Agreement,
“Material Adverse Effect” shall mean any event, development or circumstance that
has had or could reasonably be expected to have a material adverse effect on the
business, operations, property or condition (financial or otherwise) of the
Borrower and its Subsidiaries, taken as a whole, excluding in any case, any
event, development or circumstance resulting from (A) general changes or
developments (other than those resulting from acts of terrorism, war or armed
hostilities) in the vehicle rental industry or in the general economy (except to
the extent such changes or developments have a disproportionate adverse effect
on the Borrower and its Subsidiaries, taken as a whole, relative to other
participants in the vehicle rental industry), (B) normal seasonal changes in the
results of operations of the Borrower and its Subsidiaries, (C) the announcement
of the Spin-Off Transactions and the consummation of the transactions
contemplated thereby, (D) changes in accounting requirements or principles or
any changes in applicable laws or interpretations thereof, or (E) any failure in
and of itself by the Borrower or any of its Subsidiaries to meet any estimates
of revenues or earnings or other financial performance for any period (it being
agreed that the facts and circumstances giving rise to such failure may be taken
into account in determining whether there has been a Material Adverse Effect);
provided that a bankruptcy filing by, or change in the actual or perceived
credit quality of, or work stoppage affecting any “big three” auto manufacturer
shall not constitute a Material Adverse Effect so long as such “big three” auto
manufacturer has not failed to perform its material performance obligations owed
to the Borrower or any of its Subsidiaries.
 
“Materials of Environmental Concern”: all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
 
“Moody’s”: Moody’s Investors Service, Inc.
 
“Multiemployer Plan”: a Plan that is a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
 
“Net Cash Proceeds”: (a) in connection with any Asset Sale or any Recovery
Event, the proceeds thereof in the form of cash and Cash Equivalents (including
any such proceeds received by way of deferred payment of principal pursuant to a
note or installment receivable or purchase price adjustment receivable or
otherwise, but only as and when received), net of attorneys’ fees, accountants’
fees, investment banking fees, amounts required to be applied to the repayment
of Indebtedness secured by a Lien expressly permitted hereunder on any asset
that is the subject of such Asset Sale or Recovery Event (other than any Lien
pursuant to a Security Document) and other customary fees and expenses actually
incurred in connection therewith and net of taxes paid or reasonably estimated
to be payable as a result
 
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thereof (after taking into account any available tax credits or deductions and
any tax sharing arrangements, to the extent such tax credits or deductions or
tax sharing arrangements are utilized) and (b) in connection with any issuance
or sale of Capital Stock or any incurrence of Indebtedness, the cash proceeds
received from such issuance or incurrence, net of attorneys’ fees, investment
banking fees, accountants’ fees, underwriting discounts and commissions and
other customary fees and expenses actually incurred in connection therewith.
 
“New Local Facility”: as defined in Section 2.23.
 
“New Local Facility Lender”: as defined in Section 2.23.
 
“New Zealand Dollars” and “NZ$”: the lawful money of New Zealand.
 
“Non-Excluded Taxes”: as defined in Section 2.19(a).
 
“Non-U.S. Lender”: as defined in Section 2.19(d).
 
“Notes”: the collective reference to any promissory note evidencing Loans.
 
“Obligations”: the unpaid principal of and interest on (including interest
accruing after the maturity of the Loans and Reimbursement Obligations and
interest accruing after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower or any Subsidiary Borrower, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding) the Loans and all other
obligations and liabilities of the Borrower and each Subsidiary Borrower to any
Agent or Lender (or, in the case of Specified Swap Agreements and Specified Cash
Management Agreements, any affiliate of any Agent or Lender), whether direct or
indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, any other Loan Document, the Letters of Credit, any Specified Swap
Agreement, any Specified Cash Management Agreement or any other document made,
delivered or given in connection herewith or therewith, whether on account of
principal, interest, reimbursement obligations, swap coupon or termination
payments, fees or indemnities, or reasonable out-of-pocket costs or expenses
(including reasonable out-of-pocket fees, charges and disbursements of counsel
to the Administrative Agent or to any Lender that are required to be paid by the
Borrower or any Subsidiary Borrower pursuant hereto) or otherwise.
 
“Optional Currency”: at any time, Australian Dollars, Canadian Dollars, Euro,
New Zealand Dollars, Pounds Sterling and such other currencies which are
convertible into Dollars and are freely traded and available in the London
interbank eurocurrency market.
 
“original currency”: as defined in Section 10.13.
 
“Other Taxes”: any and all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement or any other Loan Document.
 
“Parent”: each of Cendant, Cendant Financing Holding Company, LLC and any other
direct or indirect parent of Holdings and the Borrower.
 
“Parent Expenses”: (i) costs (including all professional fees and expenses)
incurred by any Parent in connection with its reporting obligations under, or in
connection with compliance with,
 
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applicable laws or applicable rules of any applicable laws or applicable rules
of any governmental, regulatory or self-regulatory body or stock exchange, the
Senior Unsecured Note Indenture, or any other agreement or instrument relating
to Indebtedness of the Borrower or any Subsidiary Guarantor, including in
respect of any reports filed with respect to the Securities Act of 1933, as
amended, the Securities Exchange Act of 1934, as amended, or the respective
rules and regulations promulgated thereunder, (ii) an aggregate amount not to
exceed $5,000,000 in any fiscal year to permit any Parent to pay its corporate
overhead expenses incurred in the ordinary course of business, and to pay
salaries or other compensation of employees who perform services for any Parent
or for such Parent and the Borrower, provided that Cendant allocates such
overhead among its Subsidiaries in conformity with clause (vi) of this
paragraph, (iii) expenses incurred by any Parent in connection with the
acquisition, development, maintenance, ownership, prosecution, protection and
defense of its Intellectual Property and associated rights to the extent such
Intellectual Property and associated rights relate to the business or businesses
of the Borrower or any Subsidiary, (iv) indemnification obligations of any
Parent owing to directors, officers, employees or other Persons under its
charter or by-laws or pursuant to written agreements with any such Person, (v)
other operational and tax expenses of any Parent attributable to or incurred on
behalf of Holdings, the Borrower and its Subsidiaries in the ordinary course of
business, including reimbursement obligations under the Letter of Credit
Facilities and including obligations in respect of director and officer
insurance (including premiums therfor); provided, that following the completion
of the Spin-Off Transactions, all operational and tax expenses of any Parent are
deemed to be attributable to or incurred on behalf of the Borrower if the
Borrower’s and its Subsidiaries’ activities represent substantially all of the
operating activities of such Parent and all of its Subsidiaries, (vi) prior to
the completion of the Spin-Off Transactions, general corporate overhead expenses
allocated in conformity with past practices of the Borrower or as applied to
other Subsidiaries of Cendant (or, if applicable, to former Subsidiaries of
Cendant), and (vii) fees and expenses incurred by any Parent in connection with
any offering of Capital Stock or Indebtedness, (x) where the net proceeds of
such offering are intended to be received by or contributed or loaned to the
Borrower or any Subsidiary Guarantor, or (y) in a prorated amount of such
expenses in proportion to the amount of such net proceeds intended to be so
received, contributed or loaned, or (z) otherwise on an interim basis prior to
completion of such offering so long as any Parent shall cause the amount of such
expenses to be repaid to the Borrower or the relevant Subsidiary Guarantor out
of the proceeds of such offering promptly if completed.
 
“Participant”: as defined in Section 10.6(c).
 
“PBGC”: the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).
 
“Permitted Acquisition”: an acquisition or any series of related acquisitions by
a Loan Party (including any merger where such Loan Party is the surviving
entity) of (a) all or substantially all of the assets or a majority of the
outstanding Capital Stock of any Person or (b) any division, line of business or
other business unit of any Person (such Person or such division, line of
business or other business unit of such Person shall be referred to herein as
the “Target”), in each case that is a type of business (or assets used in a type
of business) permitted to be engaged in by the Borrower and its Subsidiaries
pursuant to Section 7.13, so long as (i) no Default or Event of Default shall
then exist or would exist after giving effect thereto, (ii) the Borrower shall
demonstrate to the reasonable satisfaction of the Administrative Agent and the
Required Lenders that, both at the time of the proposed acquisition and after
giving effect to the acquisition on a pro forma basis, the Borrower is in
compliance with each of the financial covenants set forth in Section 7.1, (iii)
the Administrative Agent, on behalf of the Lenders, shall have received (or
shall receive in connection with the closing of such acquisition) a first
priority perfected security interest, subject only to Permitted Liens, in
Collateral described in the Guarantee and Collateral Agreement (including,
without limitation, Capital Stock) acquired with respect to the Target in
accordance with the terms of Section 6.9 and the Target, if a Person that has
not merged with any Loan
 
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Party, shall have taken such actions as are required of it under Section 6.9 and
(iv) such acquisition shall not be a “hostile” acquisition and shall have been
approved by the Board of Directors and/or shareholders of the applicable Loan
Party and the Target.
 
“Permitted Lien”: any Lien permitted by Section 7.3.
 
  “Permitted Refinancing”: any Indebtedness issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness; provided that:
 
(i) the principal amount (or accreted value, if applicable) of such Indebtedness
does not exceed the principal amount (or accreted value, if applicable) of the
Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded
(plus all accrued interest thereon and the amount of all fees, expenses and
premiums incurred in connection therewith);
 
(ii) such Indebtedness has a final maturity date later than the final maturity
date of, and has a weighted average life to maturity equal to or greater than
the weighted average life to maturity of, the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; and
 
(iii) such Indebtedness is incurred by the obligor (or obligors) on the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
 
“Person”: an individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.
 
“Plan”: at a particular time, any employee benefit plan that is covered by ERISA
and in respect of which the Borrower or a Commonly Controlled Entity is (or, if
such plan were terminated at such time, would under Section 4069 of ERISA be
deemed to be) an “employer” as defined in Section 3(5) of ERISA.
 
“Pounds Sterling” and “£: the lawful money of the United Kingdom.
 
“Pricing Grid”: the table set forth below (in basis points).
 
 
Level
Moody’s/S&P
Rating Equivalent
Commitment Fee
Applicable Margin
Eurodollar Loans
Applicable Margin
ABR Loans
         
I
Baa2/BBB or better
15.0
75.0
0.0
II
Baa3/BBB-
20.0
100.0
0.0
III
Ba1/BBB- or Baa3/BB+
30.0
125.0
 
25.0
IV
Ba1/BB+
35.0
150.0
50.0
V
Ba2/BB
40.0
175.0
75.0
VI
Ba3/BB- or worse
50.0
200.0
100.0

 
The ratings referred to in the Pricing Grid shall be the ratings by each of
Moody’s and S&P of the Facilities.
 
At Level I, pricing shall be based upon the higher rating as determined by
Moody’s or S&P; in the event the ratings are split, pricing shall be based upon
the higher of the two ratings; provided
 
16

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that if (x) the higher of the two ratings is at Level I and (y) the other rating
is less than either Baa3 or BBB- from Moody’s and S&P, respectively, pricing
shall be based upon Level III.
 
At Level III, one rating must be either Baa3 or BBB- or better from Moody’s and
S&P, respectively, and the other rating must be either Ba1 or BB+ from Moody’s
and S&P, respectively.
 
At Level IV and Level V, pricing shall be based upon the higher rating as
determined by Moody’s or S&P. In the event the ratings are split by two or more
Levels, pricing shall be based upon a rating which is one Level above the lower
of the two ratings.
 
Any increase in the Commitment Fee or the Applicable Margin determined in
accordance with the foregoing table shall become effective on the date of
announcement or publication by the Borrower or the applicable rating agency of a
decrease in such rating or, in the absence of such announcement or publication,
on the effective date of such decreased rating, or on the date of any request by
the Borrower to the applicable rating agency not to rate the Facilities or on
the date any such rating agency announces it shall no longer rate the
Facilities. Any decrease in the Commitment Fee or Applicable Margin shall be
effective on the date of announcement or publication by any of such rating
agency of an increase in rating or in the absence of announcement or publication
on the effective date of such increase in rating.
 
“Pro Forma Balance Sheet”: as defined in Section 4.1(a).
 
“Properties”: the facilities and properties owned, leased or operated by any
Group Member.
 
“Recourse Vehicle Indebtedness”: Indebtedness secured by, payable from or
representing beneficial interests in Eligible Assets which provides for recourse
to the Borrower or any Subsidiary (other than a Securitization Entity).
 
“Recovery Event”: any settlement of or payment in a principal amount greater
than $25,000,000 in respect of any property or casualty insurance claim or any
condemnation proceeding relating to any asset of any Loan Party.
 
“Refunded Swingline Loans”: as defined in Section 2.7.
 
“Register”: as defined in Section 10.6(b).
 
“Regulation S-X”: Regulation S-X, promulgated pursuant to the Securities Act of
1933, as such Regulation is in effect on the date hereof.
 
“Regulation U”: Regulation U of the Board as in effect from time to time.
 
“Reimbursement Obligation”: the obligation of the Borrower or relevant
Subsidiary Borrower to reimburse the Issuing Lender pursuant to Section 3.5 for
amounts drawn under Letters of Credit.
 
“Reinvestment Deferred Amount”: with respect to any Reinvestment Event, the
aggregate Net Cash Proceeds received by any Loan Party in connection therewith
that are not applied to prepay the Term Loans or reduce the Revolving
Commitments pursuant to Section 2.11(b) as a result of the delivery of a
Reinvestment Notice.
 
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“Reinvestment Event”: any Asset Sale or Recovery Event in respect of which the
Borrower has delivered a Reinvestment Notice.
 
“Reinvestment Notice”: a written notice executed by a Responsible Officer
stating that no Event of Default has occurred and is continuing and that the
Borrower (directly or indirectly through a Subsidiary) intends and expects to
use all or a specified portion of the Net Cash Proceeds of an Asset Sale or
Recovery Event to acquire or repair assets useful in its business.
 
“Reinvestment Prepayment Amount”: with respect to any Reinvestment Event, the
Reinvestment Deferred Amount relating thereto less any amount expended prior to
the relevant Reinvestment Prepayment Date to acquire or repair assets useful in
the Borrower’s business.
 
“Reinvestment Prepayment Date”: with respect to any Reinvestment Event, the
earlier of (a) the date occurring nine months after such Reinvestment Event and
(b) the date on which the Borrower shall have determined not to, or shall have
otherwise ceased to, acquire or repair assets useful in the Borrower’s business
with all or any portion of the relevant Reinvestment Deferred Amount.
 
“Related Eligible Assets”: Eligible Assets that secure or are the direct or
indirect source of payment for AESOP Indebtedness, Securitization Indebtedness
or Recourse Vehicle Indebtedness.
 
“Related Taxes”: any and all Taxes required to be paid by the Borrower or any
Parent other than Taxes directly attributable to (i) the income of any entity
other than any Parent, Holdings, the Borrower or any of its Subsidiaries, (ii)
owning the Capital Stock of any corporation or other entity other than any
Parent, Holdings, the Borrower or any of its Subsidiaries or (iii) withholding
taxes on payments actually made by any Parent other than to any other Parent,
Holdings, the Borrower or any of its Subsidiaries.
 
“Reorganization”: with respect to any Multiemployer Plan, the condition that
such plan is in reorganization within the meaning of Section 4241 of ERISA.
 
“Replaced Term Loan”: as defined in Section 10.1(b).
 
“Replacement Term Loan”: as defined in Section 10.1(b).
 
“Reportable Event”: any of the events set forth in Section 4043(c) of ERISA,
other than those events as to which the thirty day notice period is waived under
subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg. § 4043.
 
“Required Lenders”: at any time, the holders of more than 50% of (a) until the
Closing Date, the Commitments then in effect and (b) thereafter, the sum of (i)
the aggregate unpaid principal amount of the Term Loans then outstanding and
(ii) the Total Revolving Commitments then in effect or, if the Revolving
Commitments have been terminated, the Total Revolving Extensions of Credit then
outstanding.
 
“Requirements of Law”: as to any Person, the Certificate of Incorporation and
By-Laws or other organizational or governing documents of such Person, and any
law, treaty, rule or regulation or determination of an arbitrator or a court of
competent jurisdiction or other Governmental Authority, in each case applicable
to and binding upon such Person and any of its property, and to which such
Person and any of its property is subject.
 
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“Responsible Officer”: the chief executive officer, president, chief accounting
officer, chief financial officer, treasurer or assistant treasurer of the
Borrower.
 
“Restricted Payments”: as defined in Section 7.6.
 
“Revolving Commitment”: as to any Lender, the obligation of such Lender, if any,
to make Revolving Loans and participate in Swingline Loans and Letters of Credit
in an aggregate principal and/or face amount not to exceed the amount set forth
under the heading “Revolving Commitment” opposite such Lender’s name on Schedule
1.1A or in the Assignment and Assumption pursuant to which such Lender became a
party hereto, as the same may be changed from time to time pursuant to the terms
hereof. The original amount of the Total Revolving Commitments is
$1,500,000,000.
 
“Revolving Commitment Period”: the period from and including the Closing Date to
the Revolving Termination Date.
 
“Revolving Extensions of Credit”: as to any Revolving Lender at any time, an
amount equal to the sum of (a) the aggregate principal amount of all Revolving
Loans held by such Lender then outstanding, (b) such Lender’s Revolving
Percentage of the L/C Obligations then outstanding and (c) such Lender’s
Revolving Percentage of the aggregate principal amount of Swingline Loans then
outstanding.
 
“Revolving Lender”: each Lender that has a Revolving Commitment or that holds
Revolving Loans.
 
“Revolving Loans”: as defined in Section 2.4(a).
 
“Revolving Percentage”: as to any Revolving Lender at any time, the percentage
which such Lender’s Revolving Commitment then constitutes of the Total Revolving
Commitments or, at any time after the Revolving Commitments shall have expired
or terminated, the percentage which the aggregate principal amount of such
Lender’s Revolving Loans then outstanding constitutes of the aggregate principal
amount of the Revolving Loans then outstanding, provided, that, in the event
that the Revolving Loans are paid in full prior to the reduction to zero of the
Total Revolving Extensions of Credit, the Revolving Percentages shall be
determined in a manner designed to ensure that the other outstanding Revolving
Extensions of Credit shall be held by the Revolving Lenders on a comparable
basis.
 
“Revolving Termination Date”: April 19, 2011.
 
“S&P”: Standard & Poor’s Ratings Group.
 
“SEC”: the Securities and Exchange Commission, any successor thereto and any
analogous Governmental Authority.
 
“Securitization Entity”: any Subsidiary or other Person (a) engaged solely in
the business of effecting asset securitization transactions and related
activities or (b) whose primary purpose is to hold title or ownership interests
in Eligible Assets, it being understood that WTH Funding LP, shall be deemed to
be a Securitization Entity.
 
“Securitization Indebtedness”: Indebtedness incurred by or attributable to a
Securitization Entity that does not permit or provide for recourse (other than
Standard Securitization Undertakings) to the Borrower or any Subsidiary of the
Borrower (other than a Securitization Entity) or
 
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any property or asset of the Borrower or any Subsidiary of the Borrower (other
than the property or assets of, or any equity interests or other securities
issued by, a Securitization Entity).
 
“Security Documents”: the collective reference to the Guarantee and Collateral
Agreement and all other security documents hereafter delivered to the
Administrative Agent granting a Lien on any property of any Person to secure the
obligations and liabilities of any Loan Party under any Loan Document.
 
“Senior Unsecured Note Indenture”: the Indenture entered into by the Borrower
and Avis Budget Finance in connection with the issuance of the Senior Unsecured
Notes, together with all instruments and other agreements entered into by the
Borrower, Avis Budget Finance and any other Subsidiary of the Borrower in
connection therewith.
 
“Senior Unsecured Notes”: (i) the 7.625% senior notes of the Borrower and Avis
Budget Finance due 2014 and (ii) the 7.75% senior notes of the Borrower and Avis
Budget Finance due 2016 issued pursuant to the Senior Unsecured Note Indenture.
 
“Separation Agreement”: as described on Schedule 1.1D.
 
“Significant Subsidiary”: any Subsidiary that would be a “significant
subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X.
 
“Single Employer Plan”: any Plan that is covered by Title IV of ERISA, but that
is not a Multiemployer Plan.
 
“Specified Cash Management Agreement”: any agreement providing for treasury,
depositary or cash management services, including in connection with any
automated clearing house transfers of funds or any similar transactions between
the Borrower or any Guarantor and any Lender or affiliate thereof or any Agent
or affiliate thereof, which has been designated by such Lender and the Borrower,
by notice to the Administrative Agent not later than 90 days after the execution
and delivery by the Borrower or such Guarantor, as a “Specified Cash Management
Agreement”.
 
“Specified Swap Agreement”: any Swap Agreement entered into by the Borrower or
any Guarantor and any Lender or affiliate thereof or any Agent or affiliate
thereof to hedge or mitigate its risk with respect to interest rates, currency
exchange rates or commodity prices.
 
“Spin-Off Transactions”: the separation of Cendant as contemplated by the
Separation Agreement.
 
“Standard Securitization Undertakings”: representations, warranties (and any
related repurchase obligations), servicer obligations, guaranties, covenants and
indemnities entered into by the Borrower or any Subsidiary of the Borrower of a
type that are reasonably customary in securitizations.
 
“Subsidiary”: (a) with respect to any Person, any corporation, association,
joint venture, partnership, limited liability company or other business entity
(whether now existing or hereafter organized) of which at least a majority of
the voting stock or other ownership interests having ordinary voting power for
the election of directors (or the equivalent) is, at the time as of which any
determination is being made, owned or controlled by such Person or one or more
subsidiaries of such Person or by such Person and one or more subsidiaries of
such Person or (b) any partnership where more than 50% of the general partners
of such partnership are owned or controlled, directly or indirectly, by (i) such
Person and/or (ii) one or more Subsidiaries of such Person. Unless otherwise
qualified, all references to a
 
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“Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary
or Subsidiaries of the Borrower.
 
“Subsidiary Borrower”: any Subsidiary of the Borrower that becomes a party
hereto pursuant to Section 10.1(c)(i) until such time as such Subsidiary
Borrower is removed as a party hereto pursuant to Section 10.1(c)(ii).
 
“Subsidiary Guarantor”: each Subsidiary of the Borrower other than any Foreign
Subsidiary, Excluded Subsidiary or Securitization Entity.
 
“Swap Agreement”: any agreement with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by
reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or measures
of economic, financial or pricing risk or value or any similar transaction or
any combination of these transactions; provided that no phantom stock or similar
plan providing for payments only on account of services provided by current or
former directors, officers, employees or consultants of the Borrower or any of
its Subsidiaries shall be a “Swap Agreement”.
 
“Swingline Commitment”: the obligation of the Swingline Lender to make Swingline
Loans pursuant to Section 2.6 in an aggregate principal amount at any one time
outstanding not to exceed $50,000,000.
 
“Swingline Lender”: JPMorgan Chase Bank, in its capacity as the lender of
Swingline Loans.
 
“Swingline Loans”: as defined in Section 2.6.
 
“Swingline Participation Amount”: as defined in Section 2.7.
 
“Syndication Agent”: as defined in the preamble hereto.
 
“Tax Sharing Agreement”: as described on Schedule 1.1E.
 
“Taxes” means any taxes, charges or assessments, including but not limited to
income, sales, use, transfer, rental, ad valorem, value-added, stamp, property
consumption, franchise, license, capital, net worth, gross receipts, excise,
occupancy, intangibles or similar tax, charges or assessments.
 
“Term Commitment”: as to any Lender, the obligation of such Lender, if any, to
make a Term Loan to the Borrower in a principal amount not to exceed the amount
set forth under the heading “Term Commitment” opposite such Lender’s name on
Schedule 1.1A. The original aggregate amount of the Term Commitments is
$875,000,000.
 
“Term Lender”: each Lender that has a Term Commitment or holds a Term Loan.
 
“Term Loan Maturity Date”: April 19, 2012.
 
“Term Loans”: as defined in Section 2.1.
 
“Term Percentage”: as to any Term Lender at any time, the percentage which such
Lender’s Term Commitment then constitutes of the aggregate Term Commitments (or,
at any time after
 
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the Closing Date, the percentage which the aggregate principal amount of such
Lender’s Term Loans then outstanding constitutes of the aggregate principal
amount of the Term Loans then outstanding).
 
“Total Revolving Commitments”: at any time, the aggregate amount of the
Revolving Commitments then in effect.
 
“Total Revolving Extensions of Credit”: at any time, the aggregate amount of the
Revolving Extensions of Credit of the Revolving Lenders outstanding at such
time.
 
“Transferee”: any Assignee or Participant.
 
“Type”: as to any Loan, its nature as an ABR Loan or a Eurocurrency Loan.
 
“United States”: the United States of America.
 
“Wholly Owned Subsidiary”: as to any Person, any other Person all of the Capital
Stock of which (other than directors’ qualifying shares required by law) is
owned by such Person directly and/or through other Wholly Owned Subsidiaries.
 
“WTH Funding LP”: WTH Funding Limited Partnership, an Ontario limited
partnership, and any successor special purpose entity formed for the purpose of
engaging in vehicle financings in Canada.
 
1.2   Other Definitional Provisions. (a) Unless otherwise specified therein, all
terms defined in this Agreement shall have the defined meanings when used in the
other Loan Documents or any certificate or other document made or delivered
pursuant hereto or thereto.
 
(b)   As used herein and in the other Loan Documents, and any certificate or
other document made or delivered pursuant hereto or thereto, (i) accounting
terms relating to any Group Member not defined in Section 1.1 and accounting
terms partly defined in Section 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP, (ii) the words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation”, (iii) the word “incur” shall be construed to mean incur, create,
issue, assume, become liable in respect of or suffer to exist (and the words
“incurred” and “incurrence” shall have correlative meanings), (iv) the words
“asset” and “property” shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, Capital Stock, securities, revenues, accounts, leasehold
interests and contract rights, and (v) references to agreements or other
Contractual Obligations shall, unless otherwise specified, be deemed to refer to
such agreements or Contractual Obligations as amended, supplemented, restated or
otherwise modified from time to time.
 
(c)   The words “hereof”, “herein” and “hereunder” and words of similar import,
when used in this Agreement, shall refer to this Agreement as a whole and not to
any particular provision of this Agreement, and Section, Schedule and Exhibit
references are to this Agreement unless otherwise specified.
 
(d)   The meanings given to terms defined herein shall be equally applicable to
both the singular and plural forms of such terms.
 
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SECTION 2.  AMOUNT AND TERMS OF COMMITMENTS
 
2.1   Term Commitments. Subject to the terms and conditions hereof, each Term
Lender severally agrees to make a term loan (a “Term Loan”) in Dollars to the
Borrower on the Closing Date in an amount not to exceed the amount of the Term
Commitment of such Lender. The Term Loans may from time to time be Eurocurrency
Loans or ABR Loans, as determined by the Borrower and notified to the
Administrative Agent in accordance with Sections 2.2 and 2.12.
 
2.2   Procedure for Term Loan Borrowing. The Borrower shall give the
Administrative Agent irrevocable notice (which notice must be received by the
Administrative Agent prior to (a) 12:00 Noon, New York City time, three Business
Days prior to the anticipated Closing Date, in the case of Eurocurrency Loans,
or (b) 10:00 A.M., New York City time, on the day of the anticipated Closing
Date, in the case of ABR Loans) requesting that the Term Lenders make the Term
Loans on the Closing Date and specifying the amount to be borrowed. Upon receipt
of such notice the Administrative Agent shall promptly notify each Term Lender
thereof. Not later than 12:00 Noon, New York City time, on the Closing Date each
Term Lender shall make available to the Administrative Agent at the Funding
Office an amount in immediately available funds equal to the Term Loan or Term
Loans to be made by such Lender. The Administrative Agent shall credit the
account of the Borrower on the books of such office of the Administrative Agent
with the aggregate of the amounts made available to the Administrative Agent by
the Term Lenders in immediately available funds.
 
2.3   Repayment of Term Loans. The Term Loan of each Term Lender shall be
repayable on each date set forth below in an amount equal to such Lender’s Term
Percentage multiplied by the amount set forth below opposite such date:
 
Installment
Principal Amount
   
July 31, 2006
$2,187,500
October 31, 2006
$2,187,500
January 31, 2007
$2,187,500
April 30, 2007
$2,187,500
July 31, 2007
$2,187,500
October 31, 2007
$2,187,500
January 31, 2008
$2,187,500
April 30, 2008
$2,187,500
July 31, 2008
$2,187,500
October 31, 2008
$2,187,500
January 30, 2009
$2,187,500
April 30, 2009
$2,187,500
July 31, 2009
$2,187,500
October 30, 2009
$2,187,500
January 29, 2010
$2,187,500
April 30, 2010
$2,187,500
July 30, 2010
$2,187,500
October 29, 2010
$2,187,500
January 31, 2011
$2,187,500
April 29, 2011
$2,187,500
July 29, 2011
$2,187,500
October 31, 2011
$2,187,500
January 31, 2012
$2,187,500
Term Loan Maturity Date
$824,687,500

 
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2.4   Revolving Commitments. (a) Subject to the terms and conditions hereof,
each Revolving Lender severally agrees to make revolving credit loans
(“Revolving Loans”) in Dollars to the Borrower or any Subsidiary Borrower from
time to time during the Revolving Commitment Period in an aggregate principal
amount at any one time outstanding which, when added to such Lender’s Revolving
Percentage of the sum of (i) the L/C Obligations then outstanding and (ii) the
aggregate principal amount of the Swingline Loans then outstanding, does not
exceed the amount of such Lender’s Revolving Commitment. During the Revolving
Commitment Period the Borrower and any Subsidiary Borrower may use the Revolving
Commitments by borrowing, prepaying the Revolving Loans in whole or in part, and
reborrowing, all in accordance with the terms and conditions hereof. The
Revolving Loans may from time to time be Eurocurrency Loans or ABR Loans, as
determined by the Borrower or any Subsidiary Borrower and notified to the
Administrative Agent in accordance with Sections 2.5 and 2.12. ABR Loans shall
be denominated only in Dollars.
 
(b)   The Borrower and any relevant Subsidiary Borrower shall repay all
outstanding Revolving Loans on the Revolving Termination Date.
 
2.5   Procedure for Revolving Loan Borrowing. The Borrower and any Subsidiary
Borrower may borrow under the Revolving Commitments during the Revolving
Commitment Period on any Business Day, provided that the Borrower or the
relevant Subsidiary Borrower shall give the Administrative Agent irrevocable
notice (which notice must be received by the Administrative Agent prior to (a)
12:00 Noon, New York City time, three Business Days prior to the requested
Borrowing Date, in the case of Eurocurrency Loans, or (b) 12:00 Noon, New York
City Time, on the date of the proposed borrowing, in the case of ABR Loans)
(provided that any such notice of a borrowing of ABR Loans under the Revolving
Facility to finance payments required by Section 3.5 may be given not later than
12:00 Noon, New York City time, on the date of the proposed borrowing),
specifying (i) the amount and Type of Revolving Loans to be borrowed, (ii) the
requested Borrowing Date and (iii) in the case of Eurocurrency Loans, the
respective amounts of each such Type of Loan, the Currency with respect thereto
and the respective lengths of the initial Interest Period therefor. If no
election as to the Type of a Revolving Loan is specified in any such notice,
then the requested borrowing shall be an ABR Loan. If no Currency with respect
to any Eurocurrency Loans is specified in any such notice, then the Borrower or
the relevant Subsidiary Borrower shall be deemed to have requested a borrowing
in Dollars. If no Interest Period with respect to any Eurocurrency Loan is
specified in any such notice, then the Borrower or the relevant Subsidiary
Borrower shall be deemed to have selected an Interest Period of one month’s
duration. Each borrowing under the Revolving Commitments shall be in an amount
equal to (x) in the case of ABR Loans, $1,000,000 or a whole multiple thereof
(or, if the then aggregate Available Revolving Commitments are less than
$1,000,000, such lesser amount) and (y) in the case of Eurocurrency Loans,
$5,000,000 or a whole multiple of $1,000,000 in excess thereof; provided, that
the Swingline Lender may request, on behalf of the Borrower or any Subsidiary
Borrower, borrowings under the Revolving Commitments that are ABR Loans in other
amounts pursuant to Section 2.7. Upon receipt of any such notice from the
Borrower or any Subsidiary Borrower, the Administrative Agent shall promptly
notify each Revolving Lender thereof. Each Revolving Lender will make the amount
of its pro rata share of each borrowing available to the Administrative Agent
for the account of the Borrower or the relevant Subsidiary Borrower at the
Funding Office prior to 2:00 P.M., New York City time, on the Borrowing Date
requested by the Borrower in funds immediately available to the Administrative
Agent. Such borrowing will then be made available to the Borrower or the
relevant Subsidiary Borrower by the Administrative Agent crediting the account
of the Borrower or the relevant Subsidiary Borrower on the books of such office
or such other account as the Borrower or relevant Subsidiary Borrower may
specify to the Administrative Agent in writing with the aggregate of the amounts
made available to the Administrative Agent by the Revolving Lenders and in like
funds as received by the Administrative Agent.
 
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2.6   Swingline Commitment. (a) Subject to the terms and conditions hereof, the
Swingline Lender agrees to make a portion of the credit otherwise available to
the Borrower and any Subsidiary Borrower under the Revolving Commitments from
time to time during the Revolving Commitment Period by making swing line loans
(“Swingline Loans”) in Dollars to the Borrower and any Subsidiary Borrower;
provided that (i) the aggregate principal amount of Swingline Loans outstanding
at any time shall not exceed the Swingline Commitment then in effect
(notwithstanding that the Swingline Loans outstanding at any time, when
aggregated with the Swingline Lender’s other outstanding Revolving Loans, may
exceed the Swingline Commitment then in effect) and (ii) the Borrower or the
relevant Subsidiary Borrower shall not request, and the Swingline Lender shall
not make, any Swingline Loan if, after giving effect to the making of such
Swingline Loan, the aggregate amount of the Available Revolving Commitments
would be less than zero. During the Revolving Commitment Period, the Borrower
and any Subsidiary Borrower may use the Swingline Commitment by borrowing,
repaying and reborrowing, all in accordance with the terms and conditions
hereof. Swingline Loans shall be ABR Loans only.
 
(b)   The Borrower or relevant Subsidiary Borrower shall repay to the Swingline
Lender the then unpaid principal amount of each Swingline Loan on the earlier of
the Revolving Termination Date and the first date after such Swingline Loan is
made that is the 15th or last day of a calendar month and is at least two
Business Days after such Swingline Loan is made; provided that on each date that
a Revolving Loan is borrowed, the Borrower or relevant Subsidiary Borrower shall
repay all Swingline Loans then outstanding.
 
2.7   Procedure for Swingline Borrowing; Refunding of Swingline Loans. (a)
Whenever the Borrower or any Subsidiary Borrower desires that the Swingline
Lender make Swingline Loans it shall give the Swingline Lender irrevocable
telephonic notice confirmed promptly in writing (which telephonic notice must be
received by the Swingline Lender not later than 1:00 P.M., New York City time,
on the proposed Borrowing Date), specifying (i) the amount to be borrowed and
(ii) the requested Borrowing Date (which shall be a Business Day during the
Revolving Commitment Period). Each borrowing under the Swingline Commitment
shall be in an amount equal to $500,000 or a whole multiple of $100,000 in
excess thereof. Not later than 3:00 P.M., New York City time, on the Borrowing
Date specified in a notice in respect of Swingline Loans, the Swingline Lender
shall make available to the Administrative Agent at the Funding Office an amount
in immediately available funds equal to the amount of the Swingline Loan to be
made by the Swingline Lender. The Administrative Agent shall make the proceeds
of such Swingline Loan available to the Borrower or relevant Subsidiary Borrower
on such Borrowing Date by depositing such proceeds in the account of the
Borrower or relevant Subsidiary Borrower with the Administrative Agent or such
other account as the Borrower or relevant Subsidiary Borrower may specify to the
Administrative Agent in writing on such Borrowing Date in immediately available
funds.
 
(b)   The Swingline Lender, at any time and from time to time in its sole and
absolute discretion may, on behalf of the Borrower or relevant Subsidiary
Borrower (each of which hereby irrevocably directs the Swingline Lender to act
on its behalf), on one Business Day’s notice given by the Swingline Lender no
later than 12:00 Noon, New York City time, request each Revolving Lender to
make, and each Revolving Lender hereby agrees to make, a Revolving Loan, in an
amount equal to such Revolving Lender’s Revolving Percentage of the aggregate
amount of the Swingline Loans (the “Refunded Swingline Loans”) outstanding on
the date of such notice, to repay the Swingline Lender. Each Revolving Lender
shall make the amount of such Revolving Loan available to the Administrative
Agent at the Funding Office in immediately available funds, not later than 10:00
A.M., New York City time, one Business Day after the date of such notice. The
proceeds of such Revolving Loans shall be immediately made available by the
Administrative Agent to the Swingline Lender for application by the Swingline
Lender to the repayment of the Refunded Swingline Loans. The Borrower and
relevant
 
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Subsidiary Borrower irrevocably authorize the Swingline Lender to charge the
Borrower’s and relevant Subsidiary Borrower’s accounts with the Administrative
Agent (up to the amount available in each such account) in order to immediately
pay the amount of such Refunded Swingline Loans to the extent amounts received
from the Revolving Lenders are not sufficient to repay in full such Refunded
Swingline Loans.
 
(c)   If prior to the time a Revolving Loan would have otherwise been made
pursuant to Section 2.7(b), one of the events described in Section 8(f) shall
have occurred and be continuing with respect to the Borrower or relevant
Subsidiary Borrower or if for any other reason, as determined by the Swingline
Lender in its sole discretion, Revolving Loans may not be made as contemplated
by Section 2.7(b), each Revolving Lender shall, on the date such Revolving Loan
was to have been made pursuant to the notice referred to in Section 2.7(b),
purchase for cash an undivided participating interest in the then outstanding
Swingline Loans by paying to the Swingline Lender an amount (the “Swingline
Participation Amount”) equal to (i) such Revolving Lender’s Revolving Percentage
times (ii) the sum of the aggregate principal amount of Swingline Loans then
outstanding that were to have been repaid with such Revolving Loans.
 
(d)   Whenever, at any time after the Swingline Lender has received from any
Revolving Lender such Lender’s Swingline Participation Amount, the Swingline
Lender receives any payment on account of the Swingline Loans, the Swingline
Lender will distribute to such Lender its Swingline Participation Amount
(appropriately adjusted, in the case of interest payments, to reflect the period
of time during which such Lender’s participating interest was outstanding and
funded and, in the case of principal and interest payments, to reflect such
Lender’s pro rata portion of such payment if such payment is not sufficient to
pay the principal of and interest on all Swingline Loans then due); provided,
however, that in the event that such payment received by the Swingline Lender is
required to be returned, such Revolving Lender will return to the Swingline
Lender any portion thereof previously distributed to it by the Swingline Lender.
 
(e)   Each Revolving Lender’s obligation to make the Loans referred to in
Section 2.7(b) and to purchase participating interests pursuant to Section
2.7(c) shall be absolute and unconditional and shall not be affected by any
circumstance, including (i) any setoff, counterclaim, recoupment, defense or
other right that such Revolving Lender or the Borrower or any Subsidiary
Borrower may have against the Swingline Lender, the Borrower or any Subsidiary
Borrower or any other Person for any reason whatsoever, (ii) the occurrence or
continuance of a Default or an Event of Default or the failure to satisfy any of
the other conditions specified in Section 5, (iii) any adverse change in the
condition (financial or otherwise) of the Borrower or any Subsidiary Borrower,
(iv) any breach of this Agreement or any other Loan Document by the Borrower,
any Subsidiary Borrower, any other Loan Party or any other Revolving Lender or
(v) any other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing.
 
2.8   Commitment Fees, etc.   (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Revolving Lender a commitment fee
for the period from and including the date hereof to the last day of the
Revolving Commitment Period, computed at the Commitment Fee Rate on the average
daily amount of the Available Revolving Commitment of such Lender during the
period for which payment is made, payable quarterly in arrears on each Fee
Payment Date, commencing on the first such date to occur after the date hereof.
 
(b)   The Borrower agrees to pay to the Administrative Agent the fees in the
amounts and on the dates as set forth in any fee agreements with the
Administrative Agent and to perform any other obligations contained therein.
 
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2.9   Termination or Reduction of Revolving Commitments. The Borrower shall have
the right, upon not less than three Business Days’ notice to the Administrative
Agent, to terminate the Revolving Commitments or, from time to time, to reduce
the amount of the Revolving Commitments; provided that no such termination or
reduction of Revolving Commitments shall be permitted if, after giving effect
thereto and to any prepayments of the Revolving Loans and Swingline Loans made
on the effective date thereof, the Total Revolving Extensions of Credit would
exceed the Total Revolving Commitments. Any such reduction shall be in an amount
equal to $1,000,000, or a whole multiple thereof, and shall reduce permanently
the Revolving Commitments then in effect. Each notice delivered by the Borrower
pursuant to this Section 2.9 shall be irrevocable; provided, that a notice to
terminate the Revolving Commitments delivered by the Borrower may state that
such notice is conditioned upon the effectiveness of other credit facilities or
a Change in Control, in either case, which such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. Notwithstanding the
foregoing, the revocation of a termination notice shall not affect the
Borrower’s obligation to indemnify any Lender in accordance with Section 2.20
for any loss or expense sustained or incurred as a consequence thereof.
 
2.10   Optional Prepayments. The Borrower and any relevant Subsidiary Borrower
may at any time and from time to time prepay the Loans, in whole or in part,
without premium or penalty, upon irrevocable notice (except as otherwise
provided below) delivered to the Administrative Agent no later than 12:00 Noon,
New York City time, three Business Days prior thereto, in the case of
Eurocurrency Loans, and no later than 12:00 Noon, New York City time, on the day
of such prepayment, in the case of ABR Loans, which notice shall specify the
date and amount of prepayment and whether the prepayment is of Eurocurrency
Loans or ABR Loans; provided, that if a Eurocurrency Loan is prepaid on any day
other than the last day of the Interest Period applicable thereto, the Borrower
or relevant Subsidiary Borrower shall also pay any amounts owing pursuant to
Section 2.20; provided, further, that such notice to prepay the Loans delivered
by the Borrower may state that such notice is conditioned upon the effectiveness
of other credit facilities or a Change in Control, in either case, which such
notice may be revoked by the Borrower (by further notice to the Administrative
Agent on or prior to the specified effective date) if such condition is not
satisfied. Notwithstanding the foregoing, the revocation of a termination notice
shall not affect the Borrower’s obligation to indemnify any Lender in accordance
with Section 2.20 for any loss or expense sustained or incurred as a consequence
thereof. Upon receipt of any such notice the Administrative Agent shall promptly
notify each relevant Lender thereof. If any such notice is given, the amount
specified in such notice shall be due and payable on the date specified therein,
together with (except in the case of Revolving Loans that are ABR Loans and
Swingline Loans) accrued interest to such date on the amount prepaid. Partial
prepayments of Term Loans and Revolving Loans shall be in an aggregate principal
amount of $1,000,000 or a whole multiple thereof. Partial prepayments of
Swingline Loans shall be in an aggregate principal amount of $100,000 or a whole
multiple thereof.
 
2.11   Mandatory Prepayments. (a) If any Indebtedness shall be issued or
incurred by any Group Member (excluding any Indebtedness incurred in accordance
with Section 7.2, other than paragraph (x) thereof), an amount equal to 75% of
the Net Cash Proceeds thereof shall be applied on the date of such issuance or
incurrence, or in the event such Net Cash Proceeds are received after 12:00
Noon, New York City time, on the next Business Day, toward the prepayment of the
Term Loans as set forth in Section 2.11(c).
 
(b)   If on any date any Loan Party shall receive Net Cash Proceeds from any
Asset Sale or Recovery Event then, unless a Reinvestment Notice shall be
delivered in respect thereof, 100% of such Net Cash Proceeds or, in the case of
any Disposition permitted by Section 7.5(f), 75% of such Net Cash Proceeds,
shall be applied within three Business Days toward the prepayment of the Term
Loans as set forth in Section 2.11(c); provided that on each Reinvestment
Prepayment Date, an amount equal to the
 
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Reinvestment Prepayment Amount with respect to the relevant Reinvestment Event
shall be applied toward the prepayment of the Term Loans as set forth in Section
2.11(c).
 
(c)   Amounts to be applied in connection with prepayments of the outstanding
Term Loans pursuant to this Section 2.11 shall be applied, first, to ABR Loans
and, second, to Eurocurrency Loans and, in each case, in accordance with Section
2.17(b). Each prepayment of the Term Loans under this Section 2.11 shall be
accompanied by accrued interest to the date of such prepayment on the amount
prepaid. If no Term Loans are outstanding, such remaining amounts shall be
retained by the relevant Group Member.
 
(d)   The provisions of this Section 2.11 shall be suspended at any time when
the Borrower’s senior unsecured non-credit enhanced long term indebtedness is
rated at least Baa3 by Moody’s and BBB- by S&P, in each case with stable or
positive outlook.
 
2.12   Conversion and Continuation Options. (a) The Borrower or any Subsidiary
Borrower may elect from time to time to convert Eurocurrency Loans to ABR Loans
by giving the Administrative Agent prior irrevocable notice of such election no
later than 11:00 A.M., New York City time, on the Business Day preceding the
proposed conversion date, provided that any such conversion of Eurocurrency
Loans may only be made on the last day of an Interest Period with respect
thereto. The Borrower or any Subsidiary Borrower may elect from time to time to
convert ABR Loans to Eurocurrency Loans by giving the Administrative Agent prior
irrevocable notice of such election no later than 12:00 Noon, New York City
time, on the third Business Day preceding the proposed conversion date (which
notice shall specify the length of the initial Interest Period therefor),
provided that no ABR Loan under a particular Facility may be converted into a
Eurocurrency Loan when any Event of Default has occurred and is continuing and
the Administrative Agent or the Majority Facility Lenders in respect of such
Facility have determined in its or their sole discretion not to permit such
conversions. Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof.
 
(b)   Any Eurocurrency Loan may be continued as such upon the expiration of the
then current Interest Period with respect thereto by the Borrower or relevant
Subsidiary Borrower giving irrevocable notice to the Administrative Agent, in
accordance with the applicable provisions of the term “Interest Period” set
forth in Section 1.1, of the length of the next Interest Period to be applicable
to such Loans, provided that no Eurocurrency Loan under a particular Facility
may be continued as such when any Event of Default has occurred and is
continuing and the Administrative Agent has or the Majority Facility Lenders in
respect of such Facility have determined in its or their sole discretion not to
permit such continuations (and the Administrative Agent shall notify the
Borrower within a reasonable amount of time of any such determination), and
provided, further, that if the Borrower or such Subsidiary Borrower shall fail
to give any required notice as described above in this paragraph such Loans
shall be automatically continued as Eurocurrency Loans having an Interest Period
of one month in duration or if such continuation is not permitted pursuant to
the preceding proviso such Loans shall be automatically converted to ABR Loans
on the last day of such then expiring Interest Period. Upon receipt of any such
notice the Administrative Agent shall promptly notify each relevant Lender
thereof.
 
2.13   Limitations on Eurocurrency Tranches. Notwithstanding anything to the
contrary in this Agreement, all borrowings, conversions and continuations of
Eurocurrency Loans and all selections of Interest Periods shall be in such
amounts and be made pursuant to such elections so that, (a) after giving effect
thereto, the aggregate principal amount of the Eurocurrency Loans comprising
each Eurocurrency Tranche shall be equal to $5,000,000 or a whole multiple of
$1,000,000 in excess thereof and (b) no more than ten Eurocurrency Tranches
shall be outstanding at any one time.
 
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2.14   Interest Rates and Payment Dates. (a) Each Eurocurrency Loan shall bear
interest for each day during each Interest Period with respect thereto at a rate
per annum equal to the Eurocurrency Rate determined for such day plus the
Applicable Margin.
 
(b)   Each ABR Loan shall bear interest at a rate per annum equal to the ABR
plus the Applicable Margin.
 
(c)   (i) If all or a portion of the principal amount of any Loan or
Reimbursement Obligation shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), such overdue amount shall bear interest
at a rate per annum equal to (x) in the case of the Loans, the rate that would
otherwise be applicable thereto pursuant to the foregoing provisions of this
Section plus 2% or (y) in the case of Reimbursement Obligations, the rate
applicable to ABR Loans under the Revolving Facility plus 2%, and (ii) if all or
a portion of any interest payable on any Loan or Reimbursement Obligation or any
commitment fee or other amount payable hereunder shall not be paid when due
(whether at the stated maturity, by acceleration or otherwise), such overdue
amount shall bear interest at a rate per annum equal to the rate then applicable
to ABR Loans under the relevant Facility plus 2% (or, in the case of any such
other amounts that do not relate to a particular Facility, the rate then
applicable to ABR Loans under the Revolving Facility plus 2%), in each case,
with respect to clauses (i) and (ii) above, from the date of such non-payment
until such amount is paid in full (as well after as before judgment).
 
(d)   Interest shall be payable in arrears on each Interest Payment Date,
provided that interest accruing pursuant to paragraph (c) of this Section shall
be payable from time to time on demand.
 
2.15   Computation of Interest and Fees. (a) Interest and fees payable pursuant
hereto shall be calculated on the basis of a 360-day year for the actual days
elapsed, except that, with respect to ABR Loans the rate of interest on which is
calculated on the basis of the Prime Rate, the interest thereon shall be
calculated on the basis of a 365- (or 366-, as the case may be) day year for the
actual days elapsed. The Administrative Agent shall as soon as practicable
notify the Borrower or relevant Subsidiary Borrower and the relevant Lenders of
each determination of a Eurocurrency Rate. Any change in the interest rate on a
Loan resulting from a change in the ABR or the Eurocurrency Reserve Requirements
shall become effective as of the opening of business on the day on which such
change becomes effective. The Administrative Agent shall as soon as practicable
notify the Borrower or relevant Subsidiary Borrower and the relevant Lenders of
the effective date and the amount of each such change in interest rate.
 
(b)   Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower, any Subsidiary Borrower and the Lenders in the absence of manifest
error. The Administrative Agent shall, at the request of the Borrower or any
Subsidiary Borrower, deliver to the Borrower or such Subsidiary Borrower a
statement showing the quotations used by the Administrative Agent in determining
any interest rate pursuant to Section 2.14(a).
 
2.16   Inability to Determine Interest Rate. If prior to the first day of any
Interest Period:
 
(a)  the Administrative Agent shall have determined (which determination shall
be conclusive and binding upon the Borrower or relevant Subsidiary Borrower)
that, by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurocurrency Rate for such
Interest Period, or
 
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(b)   the Administrative Agent shall have received notice from the Majority
Facility Lenders in respect of the relevant Facility that the Eurocurrency Rate
determined or to be determined for such Interest Period will not adequately and
fairly reflect the cost to such Lenders (as conclusively certified by such
Lenders) of making or maintaining their affected Loans during such Interest
Period,
 
the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower or relevant Subsidiary Borrower and the relevant Lenders as soon as
practicable thereafter. If such notice is given (w) any Eurocurrency Loans under
the relevant Facility requested to be made on the first day of such Interest
Period shall be made as ABR Loans, (x) any Loans under the relevant Facility
that were to have been converted on the first day of such Interest Period to
Eurocurrency Loans shall be continued as ABR Loans and (y) any outstanding
Eurocurrency Loans under the relevant Facility shall be converted, on the last
day of the then-current Interest Period, to ABR Loans. Until such notice has
been withdrawn by the Administrative Agent, no further Eurocurrency Loans under
the relevant Facility shall be made or continued as such, nor shall the Borrower
nor any Subsidiary Borrower have the right to convert Loans under the relevant
Facility to Eurocurrency Loans.
 
2.17   Pro Rata Treatment and Payments. (a) Each borrowing by the Borrower or
any Subsidiary Borrower from the Lenders hereunder, each payment by the Borrower
on account of any commitment fee and any reduction of the Commitments of the
Lenders shall be made pro rata according to the respective Term Percentages or
Revolving Percentages, as the case may be, of the relevant Lenders.
 
(b)   Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Term Loans shall be made pro rata according to
the respective outstanding principal amounts of the Term Loans then held by the
Term Lenders. The amount of each principal prepayment of the Term Loans shall be
applied to reduce the then remaining installments of the Term Loans as directed
by the Borrower. Amounts prepaid on account of the Term Loans may not be
reborrowed.
 
(c)   Each payment (including each prepayment) by the Borrower or any Subsidiary
Borrower on account of principal of and interest on the Revolving Loans shall be
made pro rata according to the respective outstanding principal amounts of the
Revolving Loans then held by the Revolving Lenders.
 
(d)   All payments (including prepayments) to be made by the Borrower or any
Subsidiary Borrower hereunder, whether on account of principal, interest, fees
or otherwise, shall be made without setoff or counterclaim and shall be made
prior to 1:00 P.M., New York City time, on the due date thereof to the
Administrative Agent, for the account of the Lenders, at the Funding Office, in
Dollars and in immediately available funds. The Administrative Agent shall
distribute such payments to the Lenders promptly upon receipt in like funds as
received. If any payment hereunder (other than payments on the Eurocurrency
Loans) becomes due and payable on a day other than a Business Day, such payment
shall be extended to the next succeeding Business Day. If any payment on a
Eurocurrency Loan becomes due and payable on a day other than a Business Day,
the maturity thereof shall be extended to the next succeeding Business Day
unless the result of such extension would be to extend such payment into another
calendar month, in which event such payment shall be made on the immediately
preceding Business Day. In the case of any extension of any payment of principal
pursuant to the preceding two sentences, interest thereon shall be payable at
the then applicable rate during such extension.
 
(e)   Unless the Administrative Agent shall have been notified in writing by any
Lender prior to a borrowing that such Lender will not make the amount that would
constitute its share of such borrowing available to the Administrative Agent,
the Administrative Agent may assume that such Lender is making such amount
available to the Administrative Agent, and the Administrative Agent may, in
 
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reliance upon such assumption, make available to the Borrower or any Subsidiary
Borrower a corresponding amount. If such amount is not made available to the
Administrative Agent by the required time on the Borrowing Date therefor, such
Lender shall pay to the Administrative Agent, on demand, such amount with
interest thereon, at a rate up to the greater of (i) the Federal Funds Effective
Rate and (ii) a rate determined by the Administrative Agent in accordance with
banking industry rules on interbank compensation, for the period until such
Lender makes such amount immediately available to the Administrative Agent. A
certificate of the Administrative Agent submitted to any Lender with respect to
any amounts owing under this paragraph shall be conclusive in the absence of
manifest error. If such Lender’s share of such borrowing is not made available
to the Administrative Agent by such Lender within three Business Days after such
Borrowing Date, the Administrative Agent shall also be entitled to recover such
amount with interest thereon at the rate per annum applicable to ABR Loans under
the relevant Facility, on demand, from the Borrower or relevant Subsidiary
Borrower.
 
(f)   Unless the Administrative Agent shall have been notified in writing by the
Borrower or relevant Subsidiary Borrower prior to the date of any payment due to
be made by the Borrower or such Subsidiary Borrower hereunder that the Borrower
or such Subsidiary Borrower will not make such payment to the Administrative
Agent, the Administrative Agent may assume that the Borrower or such Subsidiary
Borrower is making such payment, and the Administrative Agent may, but shall not
be required to, in reliance upon such assumption, make available to the Lenders
their respective pro rata shares of a corresponding amount. If such payment is
not made to the Administrative Agent by the Borrower or relevant Subsidiary
Borrower within three Business Days after such due date, the Administrative
Agent shall be entitled to recover, on demand, from each Lender to which any
amount which was made available pursuant to the preceding sentence, such amount
with interest thereon at the rate per annum equal to the daily average Federal
Funds Effective Rate. Nothing herein shall be deemed to limit the rights of the
Administrative Agent or any Lender against the Borrower or any Subsidiary
Borrower.
 
2.18   Requirements of Law. Except with respect to Taxes, which shall be
governed exclusively by Section 2.19 of this Agreement:
 
 (a) If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof or compliance by any Lender with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the date hereof:
 
(i)   shall impose, modify or hold applicable any reserve, special deposit,
compulsory loan or similar requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other extensions of
credit by, or any other acquisition of funds by, any office of such Lender that
is not otherwise included in the determination of the Eurocurrency Rate; or
 
(ii)    shall impose on such Lender any other condition;
 
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount that such Lender deems to be material, of making, converting into,
continuing or maintaining Eurocurrency Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower or relevant Subsidiary Borrower
shall promptly pay such Lender, upon its demand, any additional amounts
necessary to compensate such Lender for such increased cost or reduced amount
receivable. If any Lender becomes entitled to claim any additional amounts
pursuant to this paragraph, it shall promptly notify the Borrower or relevant
Subsidiary Borrower (with a copy to the Administrative Agent) of the event by
reason of which it has become so entitled.
 
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(b) If any Lender shall have determined that the adoption of or any change in
any Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by such Lender or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any Governmental Authority made subsequent to
the date hereof shall have the effect of reducing the rate of return on such
Lender’s or such corporation’s capital as a consequence of its obligations
hereunder or under or in respect of any Letter of Credit to a level below that
which such Lender or such corporation could have achieved but for such adoption,
change or compliance (taking into consideration such Lender’s or such
corporation’s policies with respect to capital adequacy) by an amount deemed by
such Lender to be material, then from time to time, after submission by such
Lender to the Borrower (with a copy to the Administrative Agent) of a written
request therefor, the Borrower shall pay to such Lender such additional amount
or amounts as will compensate such Lender or such corporation for such
reduction.
 
(c)   A certificate as to any additional amounts payable pursuant to this
Section submitted by any Lender to the Borrower or relevant Subsidiary Borrower
(with a copy to the Administrative Agent) shall be conclusive in the absence of
manifest error. Notwithstanding anything to the contrary in this Section, the
Borrower or relevant Subsidiary Borrower shall not be required to compensate a
Lender pursuant to this Section for any amounts incurred more than six months
prior to the date that such Lender notifies the Borrower or such Subsidiary
Borrower of such Lender’s intention to claim compensation therefor; provided
that, if the circumstances giving rise to such claim have a retroactive effect,
then such six-month period shall be extended to include the period of such
retroactive effect. The obligations of the Borrower or relevant Subsidiary
Borrower pursuant to this Section shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.
 
2.19   Taxes. (a) All payments made by the Borrower or any Subsidiary Borrower
under this Agreement shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding (a) net income taxes and franchise taxes
(imposed in lieu of net income taxes) imposed on the Administrative Agent or any
Lender as a result of a present or former connection between the Administrative
Agent or such Lender and the jurisdiction of the Governmental Authority imposing
such tax or any political subdivision or taxing authority thereof or therein
(other than any such connection arising solely from the Administrative Agent or
such Lender having executed, delivered or performed its obligations or received
a payment under, or enforced, this Agreement or any other Loan Document) and (b)
any branch profit taxes imposed by the United States or any similar tax imposed
by any other Governmental Authority. If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings (“Non-Excluded
Taxes”) or Other Taxes are required to be withheld from any amounts payable to
the Administrative Agent or any Lender hereunder, the amounts so payable to the
Administrative Agent or such Lender shall be increased to the extent necessary
to yield to the Administrative Agent or such Lender (after payment of all
Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement, provided,
however, that neither the Borrower nor any Subsidiary Borrower shall be required
to increase any such amounts payable to any Lender with respect to any
Non-Excluded Taxes (i) that are attributable to such Lender’s failure to comply
with the requirements of paragraph (d) or (e) of this Section, (ii) that are
United States withholding taxes imposed on amounts payable to such Lender at the
time such Lender becomes a party to this Agreement (or designates a new lending
office or offices) except, in the case of an assignment or designation of a new
lending office, to the extent that the Lender making such assignment or
designation was entitled, at the time of such assignment or designation, to
receive additional amounts from the Borrower or the relevant Subsidiary Borrower
with respect to Non-Excluded Taxes pursuant to this section or (iii) that are
imposed as a result of a Lender’s gross negligence or willful misconduct.
 
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(b)   In addition, the Borrower or any relevant Subsidiary Borrower shall pay
any Other Taxes to the relevant Governmental Authority in accordance with
applicable law.
 
(c)   Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower
or any Subsidiary Borrower, as promptly as possible thereafter the Borrower or
such Subsidiary Borrower shall send to the Administrative Agent for its own
account or for the account of the relevant Lender, as the case may be, a
certified copy of an original official receipt received by the Borrower or such
Subsidiary Borrower showing payment thereof. If the Borrower or any Subsidiary
Borrower fails to pay any Non-Excluded Taxes or Other Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative Agent the
required receipts or other required documentary evidence, the Borrower and each
Subsidiary Borrower shall indemnify the Administrative Agent and the Lenders for
any incremental taxes, interest or penalties that may become payable by the
Administrative Agent or any Lender as a result of any such failure.
 
(d)    Each Lender (or Transferee) (i) that is not a “U.S. Person” as defined in
Section 7701(a)(30) of the Code (a “Non-U.S. Lender”) shall deliver to the
Borrower and the Administrative Agent (or, in the case of a Participant, to the
Lender from which the related participation shall have been purchased) two
copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI, or,
in the case of a Non-U.S. Lender claiming exemption from U.S. federal
withholding tax under Section 871(h) or 881(c) of the Code with respect to
payments of “portfolio interest”, a statement substantially in the form of
Exhibit F and a Form W-8BEN, or any subsequent versions thereof or successors
thereto, properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Borrower or any Subsidiary Borrower under this Agreement and
the other Loan Documents and (ii) that is a “U.S. Person” as defined in Section
7701(a)(30) of the Code shall deliver to the Borrower and the Administrative
Agent (or in the case of a Participant, to the Lender from which the related
participation shall have been purchased) two copies of U.S. Internal Revenue
Service Form W-9. Such forms shall be delivered by each Lender on or before the
date it becomes a party to this Agreement (or, in the case of any Participant,
on or before the date such Participant purchases the related participation). In
addition, each Lender shall deliver such forms promptly upon the obsolescence or
invalidity of any form previously delivered by such Lender at any other time
prescribed by applicable law or as reasonably requested by the Borrower. Each
Non-U.S. Lender shall promptly notify the Borrower at any time it determines
that it is no longer in a position to provide any previously delivered
certificate to the Borrower (and any other form of certification adopted by the
U.S. taxing authorities for such purpose).
 
(e)   A Lender or Transferee that is entitled to an exemption from or reduction
of non-U.S. withholding tax under the law of the jurisdiction in which the
Borrower or any Subsidiary Borrower is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall
deliver to the Borrower (with a copy to the Administrative Agent), at the time
or times prescribed by applicable law or reasonably requested by the Borrower,
such properly completed and executed documentation prescribed by applicable law
as will permit such payments to be made without withholding or at a reduced
rate.
 
(f)   If the Administrative Agent, any Transferee or any Lender determines, in
its sole good faith discretion, that it has received a refund of any
Non-Excluded Taxes or Other Taxes as to which it has been indemnified by the
Borrower or any Subsidiary Borrower or with respect to which the Borrower or any
Subsidiary Borrower has paid additional amounts pursuant to this Section 2.19,
it shall pay over such refund to the Borrower or such Subsidiary Borrower (but
only to the extent of indemnity payments made, or additional amounts paid, by
the Borrower or such Subsidiary Borrower under this Section 2.19 with respect to
the Non-Excluded Taxes or Other Taxes giving rise to such refund), net of all
out-of-pocket expenses of the Administrative Agent, such Transferee or such
Lender and without interest
 
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(other than any interest paid by the relevant Governmental Authority with
respect to such refund); provided, that the Borrower or such Subsidiary
Borrower, upon the request of the Administrative Agent , such Transferee or such
Lender, agrees to repay the amount paid over to the Borrower or such Subsidiary
Borrower (plus any penalties, interest or other charges imposed by the relevant
Governmental Authority) to the Administrative Agent, such Transferee or such
Lender in the event the Administrative Agent, such Transferee or such Lender is
required to repay such refund to such Governmental Authority. This paragraph
shall not be construed to require the Administrative Agent, any Transferee or
any Lender to make available its tax returns (or any other information relating
to its taxes which it deems confidential) to the Borrower, any Subsidiary
Borrower or any other Person.
 
(g)   Each Assignee shall be bound by this Section 2.19.
 
(h)   The agreements in this Section shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.
 
2.20   Indemnity. The Borrower or relevant Subsidiary Borrower agrees to
indemnify each Lender for, and to hold each Lender harmless from, any actual
loss or expense that such Lender may sustain or incur as a consequence of
(a) default by the Borrower or relevant Subsidiary Borrower in making a
borrowing of, conversion into or continuation of Eurocurrency Loans after the
Borrower or such Subsidiary Borrower has given a notice requesting the same in
accordance with the provisions of this Agreement, (b) default by the Borrower or
relevant Subsidiary Borrower in making any prepayment of or conversion from
Eurocurrency Loans after the Borrower or such Subsidiary Borrower has given a
notice thereof in accordance with the provisions of this Agreement or (c) the
making of a prepayment of Eurocurrency Loans on a day that is not the last day
of an Interest Period with respect thereto. Such indemnification may include an
amount up to the excess, if any, of (i) the amount of interest that would have
accrued on the amount so prepaid, or not so borrowed, converted or continued,
for the period from the date of such prepayment or of such failure to borrow,
convert or continue to the last day of such Interest Period (or, in the case of
a failure to borrow, convert or continue, the Interest Period that would have
commenced on the date of such failure) in each case at the applicable rate of
interest for such Loans provided for herein (excluding, however, the Applicable
Margin included therein, if any) over (ii) the amount of interest (as reasonably
determined by such Lender) that would have accrued to such Lender on such amount
by placing such amount on deposit for a comparable period with leading banks in
the interbank eurocurrency market. A certificate as to any amounts payable
pursuant to this Section submitted to the Borrower or relevant Subsidiary
Borrower by any Lender shall be conclusive in the absence of manifest error.
This covenant shall survive the termination of this Agreement and the payment of
the Loans and all other amounts payable hereunder.
 
2.21   Change of Lending Office. Each Lender agrees that, upon the occurrence of
any event giving rise to the operation of Section 2.18 or 2.19(a) with respect
to such Lender, it will, if requested by the Borrower, use reasonable efforts
(subject to overall policy considerations of such Lender) to designate another
lending office for any Loans affected by such event with the object of avoiding
the consequences of such event; provided, that such designation is made on terms
that, in the sole judgment of such Lender, cause such Lender and its lending
office(s) to suffer no economic, legal or regulatory disadvantage, and provided,
further, that nothing in this Section shall affect or postpone any of the
obligations of the Borrower or any Subsidiary Borrower or the rights of any
Lender pursuant to Section 2.18 or 2.19(a).
 
2.22   Replacement of Lenders. The Borrower shall be permitted to replace any
Lender that (a) requests reimbursement for amounts owing pursuant to Section
2.18 or 2.19(a), (b) defaults in its obligation to make Loans hereunder or (c)
fails to give its consent for any issue requiring the consent of 100% of the
Lenders or all affected Lenders (and such Lender is an affected Lender) and for
which
 
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Lenders holding 66 2/3 of the Loans and/or Commitments required for such vote
have consented, with a replacement financial institution; provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) no Event of
Default shall have occurred and be continuing at the time of such replacement,
(iii) prior to any such replacement, such Lender shall have taken no action
under Section 2.21 so as to eliminate the continued need for payment of amounts
owing pursuant to Section 2.18 or 2.19(a), (iv) the replacement financial
institution shall purchase, at par, all Loans and other amounts owing to such
replaced Lender on or prior to the date of replacement, (v) the Borrower shall
be liable to such replaced Lender under Section 2.20 if any Eurocurrency Loan
owing to such replaced Lender shall be purchased other than on the last day of
the Interest Period relating thereto, (vi) the replacement financial institution
shall be reasonably satisfactory to the Administrative Agent, (vii) the replaced
Lender shall be obligated to make such replacement in accordance with the
provisions of Section 10.6 (provided that the Borrower shall be obligated to pay
the registration and processing fee referred to therein), (viii) until such time
as such replacement shall be consummated, the Borrower shall pay all additional
amounts (if any) required pursuant to Section 2.18 or 2.19(a), as the case may
be, and (ix) any such replacement shall not be deemed to be a waiver of any
rights that the Borrower, the Administrative Agent or any other Lender shall
have against the replaced Lender.
 
2.23   New Local Facilities. (a) The Borrower may at any time or from time to
time after the Closing Date, by notice to the Administrative Agent and the
Revolving Lenders, request the Revolving Lenders to designate a portion of their
respective Revolving Commitments to make Revolving Extensions of Credit
denominated in Dollars and any Optional Currency in a jurisdiction outside of
the United States pursuant to a newly established sub-facility under the
Revolving Facility (each, a “New Local Facility”); provided that (i) both at the
time of any such request and upon the effectiveness of any Local Facility
Amendment referred to below, no Default or Event of Default shall have occurred
and be continuing and (ii) the Borrower and its Subsidiaries shall be in
compliance with the covenants set forth in Section 7.1 as of the last day of the
most recently ended fiscal quarter; provided further that any (i) LC Obligations
outstanding as of the date of the establishment of a New Local Facility shall be
deemed to be outstanding under such New Local Facility on a pro rata basis in
accordance with the aggregate Revolving Commitments (it being understood that
thereafter, new LC Obligations shall not reduce the availability under such New
Local Facility, except to the extent Letters of Credit are issued thereunder)
and (ii) no Lender shall be required to make Revolving Extensions of Credit in
excess of its Revolving Commitment. Each New Local Facility shall be in a
minimum Dollar Equivalent amount of $10,000,000. Each notice from the Borrower
pursuant to this Section 2.23 shall set forth the requested amount and proposed
terms of the relevant New Local Facility. Revolving Lenders wishing to designate
a portion of their Revolving Commitments to a New Local Facility (each, a “New
Local Facility Lender”) shall have such portion of their Revolving Commitment
designated to such New Local Facility on a pro rata basis in accordance with the
aggregate Revolving Commitments of the other New Local Facility Lenders. The
designation of Revolving Commitments to any New Local Facility shall be made
pursuant to an amendment (each, a “Local Facility Amendment”) to this Agreement
and, as appropriate, the other Loan Documents, executed by the Loan Parties, the
Administrative Agent and each New Local Facility Lender. Any Local Facility
Amendment may, without the consent of any other Lenders, effect such amendments
to this Agreement and the other Loan Documents as may be necessary or
appropriate, in the reasonable opinion of the Administrative Agent and the
Borrower, to effect the provisions of this Section, a copy of which shall be
made available to each Lender. The effectiveness of any Local Facility Amendment
shall be subject to the satisfaction on the date thereof of each of the
conditions set forth in Section 5.2 and such other conditions as the parties
thereto shall agree. No Revolving Lender shall be obligated to transfer any
portion of its Revolving Commitments to a New Local Facility unless it so
agrees.
 
(b)   This Section 2.23 shall supersede any provisions in Section 10.1(a) to
the contrary as relates to any Local Facility Amendment.
 
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2.24   Prepayments Required Due to Currency Fluctuation. On the last Business
Day of each fiscal quarter, or at such other time as is reasonably determined by
the Administrative Agent, the Administrative Agent shall determine the Dollar
Equivalent of aggregate outstanding Revolving Extensions of Credit. If, at the
time of such determination the aggregate outstanding Revolving Extensions of
Credit exceed the Revolving Commitments then in effect by 5% or more, then
within five Business Days of notice to the Borrower, the Borrower or the
relevant Subsidiary Borrower shall prepay Revolving Loans or Swingline Loans or
cash collateralize the outstanding Letters of Credit in an aggregate principal
amount at least equal to such excess; provided that the failure of the
Administrative Agent to determine the Dollar Equivalent Amount of the aggregate
outstanding Revolving Extensions of Credit as provided in this Section 2.24
shall not subject the Administrative Agent to any liability hereunder.
 
SECTION 3.  LETTERS OF CREDIT
 
3.1   L/C Commitment. (a) Subject to the terms and conditions hereof, the
Issuing Lender, in reliance on the agreements of the other Revolving Lenders set
forth in Section 3.4(a), agrees to issue letters of credit (“Letters of Credit”)
for the account of the Borrower or any Subsidiary Borrower on any Business Day
during the Revolving Commitment Period in such form as may be approved from time
to time by the Issuing Lender; provided that the Issuing Lender shall not issue
any Letter of Credit if, after giving effect to such issuance, the aggregate
amount of the Available Revolving Commitments would be less than zero. Each
Letter of Credit shall (i) be denominated in Dollars and (ii) expire no later
than the earlier of (x) the first anniversary of its date of issuance and (y)
the date that is five Business Days prior to the Revolving Termination Date,
provided that any Letter of Credit with a one-year term may provide for the
automatic renewal or renewal thereof for additional one-year periods (which
shall in no event extend beyond the date referred to in clause (y) above).
 
(b)   The Issuing Lender shall not at any time be obligated to issue any Letter
of Credit if such issuance would conflict with, or cause the Issuing Lender or
any L/C Participant to exceed any limits imposed by, any applicable Requirement
of Law.
 
3.2   Procedure for Issuance of Letter of Credit. The Borrower or any Subsidiary
Borrower may from time to time request that the Issuing Lender issue a Letter of
Credit by delivering to the Issuing Lender at its address for notices specified
herein an Application therefor, completed to the satisfaction of the Issuing
Lender, and such other certificates, documents and other papers and information
as the Issuing Lender may request. Upon receipt of any Application, the Issuing
Lender will process such Application and the certificates, documents and other
papers and information delivered to it in connection therewith in accordance
with its customary procedures and shall promptly issue the Letter of Credit
requested thereby (but in no event shall the Issuing Lender be required to issue
any Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Lender and the Borrower or relevant Subsidiary Borrower. The Issuing
Lender shall furnish a copy of such Letter of Credit to the Borrower or relevant
Subsidiary Borrower promptly following the issuance thereof. The Issuing Lender
shall promptly furnish to the Administrative Agent, which shall in turn promptly
furnish to the Lenders, notice of the issuance of each Letter of Credit
(including the amount thereof).
 
3.3   Fees and Other Charges. (a) The Borrower will pay a fee on all outstanding
Letters of Credit issued for the account of the Borrower and any relevant
Subsidiary Borrower at a per annum rate equal to the Applicable Margin then in
effect with respect to Eurocurrency Loans under the Revolving Facility, shared
ratably among the Revolving Lenders and payable quarterly in arrears on each Fee
Payment Date after the issuance date. In addition, the Borrower shall pay a
fronting fee in an amount
 
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to be agreed with the Issuing Lender (but, in any event, not greater than of
0.125% per annum) on the undrawn and unexpired amount of each Letter of Credit
issued for the account of the Borrower or any relevant Subsidiary Borrower,
payable quarterly in arrears on each Fee Payment Date after the issuance date.
 
(b)    In addition to the foregoing fees, the Borrower shall pay or reimburse
the Issuing Lender for such normal and customary costs and expenses as are
incurred or charged by the Issuing Lender in issuing, negotiating, effecting
payment under, amending or otherwise administering any Letter of Credit.
 
3.4   L/C Participations. (a) The Issuing Lender irrevocably agrees to grant and
hereby grants to each L/C Participant, and, to induce the Issuing Lender to
issue Letters of Credit, each L/C Participant irrevocably agrees to accept and
purchase and hereby accepts and purchases from the Issuing Lender, on the terms
and conditions set forth below, for such L/C Participant’s own account and risk
an undivided interest equal to such L/C Participant’s Revolving Percentage in
the Issuing Lender’s obligations and rights under and in respect of each Letter
of Credit and the amount of each draft paid by the Issuing Lender thereunder.
Each L/C Participant agrees with the Issuing Lender that, if a draft is paid
under any Letter of Credit for which the Issuing Lender is not reimbursed in
full by the Borrower or relevant Subsidiary Borrower in accordance with the
terms of this Agreement, such L/C Participant shall pay to the Issuing Lender
upon demand at the Issuing Lender’s address for notices specified herein an
amount equal to such L/C Participant’s Revolving Percentage of the amount of
such draft, or any part thereof, that is not so reimbursed. Each L/C
Participant’s obligation to pay such amount shall be absolute and unconditional
and shall not be affected by any circumstance, including (i) any setoff,
counterclaim, recoupment, defense or other right that such L/C Participant may
have against the Issuing Lender, the Borrower, any Subsidiary Borrower or any
other Person for any reason whatsoever, (ii) the occurrence or continuance of a
Default or an Event of Default or the failure to satisfy any of the other
conditions specified in Section 5, (iii) any adverse change in the condition
(financial or otherwise) of the Borrower or any Subsidiary Borrower, (iv) any
breach of this Agreement or any other Loan Document by the Borrower, any
Subsidiary Borrower, any other Loan Party or any other L/C Participant or (v)
any other circumstance, happening or event whatsoever, whether or not similar to
any of the foregoing
 
(b)   If any amount required to be paid by any L/C Participant to the Issuing
Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion of any
payment made by the Issuing Lender under any Letter of Credit is paid to the
Issuing Lender within three Business Days after the date such payment is due,
such L/C Participant shall pay to the Issuing Lender on demand an amount equal
to the product of (i) such amount, times (ii) the daily average Federal Funds
Effective Rate during the period from and including the date such payment is
required to the date on which such payment is immediately available to the
Issuing Lender, times (iii) a fraction the numerator of which is the number of
days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any L/C Participant pursuant to Section
3.4(a) is not made available to the Issuing Lender by such L/C Participant
within three Business Days after the date such payment is due, the Issuing
Lender shall be entitled to recover from such L/C Participant, on demand, such
amount with interest thereon calculated from such due date at the rate per annum
applicable to ABR Loans under the Revolving Facility. A certificate of the
Issuing Lender submitted to any L/C Participant with respect to any amounts
owing under this Section shall be conclusive in the absence of manifest error.
 
(c)   Whenever, at any time after the Issuing Lender has made payment under any
Letter of Credit and has received from any L/C Participant its pro rata share of
such payment in accordance with Section 3.4(a), the Issuing Lender receives any
payment related to such Letter of Credit (whether directly from the Borrower or
relevant Subsidiary Borrower or otherwise, including proceeds of collateral
applied thereto by the Issuing Lender), or any payment of interest on account
thereof, the Issuing Lender will
 
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distribute to such L/C Participant its pro rata share thereof; provided,
however, that in the event that any such payment received by the Issuing Lender
shall be required to be returned by the Issuing Lender, such L/C Participant
shall return to the Issuing Lender the portion thereof previously distributed by
the Issuing Lender to it.
 
3.5   Reimbursement Obligation of the Borrower. If any draft is paid under any
Letter of Credit, the Borrower or relevant Subsidiary Borrower shall reimburse
the Issuing Lender for the amount of (a) the draft so paid and (b) any taxes,
fees, charges or other costs or expenses incurred by the Issuing Lender in
connection with such payment, not later than 1:00 P.M., New York City time, on
(i) the Business Day that the Borrower or relevant Subsidiary Borrower receives
notice of such draft, if such notice is received on such day prior to 10:00
A.M., New York City time, or (ii) if clause (i) above does not apply, the
Business Day immediately following the day that the Borrower or relevant
Subsidiary Borrower receives such notice. Each such payment shall be made to the
Issuing Lender at its address for notices referred to herein in Dollars and in
immediately available funds. Interest shall be payable on any such amounts from
the date on which the relevant draft is paid until payment in full at the rate
set forth in (x) until the Business Day next succeeding the date of the relevant
notice, Section 2.14(b) and (y) thereafter, Section 2.14(c).
 
3.6   Obligations Absolute. The obligations of the Borrower and any relevant
Subsidiary Borrower under this Section 3 shall be absolute and unconditional
under any and all circumstances and irrespective of any setoff, counterclaim or
defense to payment that the Borrower or such Subsidiary Borrower, as the case
may be, may have or have had against the Issuing Lender, any beneficiary of a
Letter of Credit or any other Person. The Borrower and each relevant Subsidiary
Borrower also agrees with the Issuing Lender that the Issuing Lender shall not
be responsible for, and the Reimbursement Obligations under Section 3.5 of the
Borrower and any relevant Subsidiary Borrower shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements
thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, or any dispute between or among the Borrower or such
Subsidiary Borrower, as the case may be, and any beneficiary of any Letter of
Credit or any other party to which such Letter of Credit may be transferred or
any claims whatsoever of the Borrower or such Subsidiary, as the case may be,
against any beneficiary of such Letter of Credit or any such transferee. The
Issuing Lender shall not be liable for any error, omission, interruption or
delay in transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit, except for errors or
omissions found by a final and nonappealable decision of a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
the Issuing Lender. The Borrower and each relevant Subsidiary Borrower agrees
that any action taken or omitted by the Issuing Lender under or in connection
with any Letter of Credit or the related drafts or documents, if done in the
absence of gross negligence or willful misconduct, shall be binding on the
Borrower or such Subsidiary Borrower and shall not result in any liability of
the Issuing Lender to the Borrower or such Subsidiary Borrower.
 
3.7   Letter of Credit Payments. If any draft shall be presented for payment
under any Letter of Credit, the Issuing Lender shall promptly notify the
Borrower or relevant Subsidiary Borrower of the date and amount thereof. The
responsibility of the Issuing Lender to the Borrower or relevant Subsidiary
Borrower in connection with any draft presented for payment under any Letter of
Credit shall, in addition to any payment obligation expressly provided for in
such Letter of Credit, be limited to determining that the documents (including
each draft) delivered under such Letter of Credit in connection with such
presentment are substantially in conformity with such Letter of Credit.
 
3.8   Applications. To the extent that any provision of any Application related
to any Letter of Credit is inconsistent with the provisions of this Section 3,
the provisions of this Section 3 shall apply.
 
 
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3.9   Existing Letters of Credit. On and as of the Closing Date the letters of
credit set forth on Schedule 3.9 (the “Existing Letters of Credit”) will
constitute Letters of Credit under this Agreement and for the purposes hereof
will be deemed to have been issued for the account of the Borrower on the
Closing Date.
 
SECTION 4.  REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this Agreement
and to make the Loans and issue or participate in the Letters of Credit,
Holdings and the Borrower hereby jointly and severally represent and warrant to
the Administrative Agent and each Lender that:
 
4.1   Financial Condition. (a) The unaudited pro forma consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at December 31, 2005
(including the notes thereto) (the “Pro Forma Balance Sheet”), copies of which
have heretofore been furnished to each Lender, has been prepared giving effect
(as if such events had occurred on such date) to (i) the Loans to be made on the
Closing Date and the use of proceeds thereof, (ii) the issuance of the Senior
Unsecured Notes and the use of proceeds thereof and (iii) the payment of fees
and expenses in connection with the foregoing. The Pro Forma Balance Sheet has
been prepared based on the best information available to the Borrower as of the
date of delivery thereof, and presents fairly on a pro forma basis the estimated
financial position of the Borrower and its consolidated Subsidiaries as at
December 31, 2005, assuming that the events specified in the preceding sentence
had actually occurred at such date.
 
(b)   The audited consolidated balance sheets of the Borrower as at December 31,
2005, December 31, 2004 and December 31, 2003, and the related consolidated
statements of income and of cash flows for the fiscal years ended on such dates
(the “Consolidated Financial Statements”), reported on by and accompanied by an
unqualified report from Deloitte & Touche LLP, present fairly the consolidated
financial condition of the Borrower as at such date, and the consolidated
results of its operations and its consolidated cash flows for the respective
fiscal years then ended. All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved by the
aforementioned firm of accountants and disclosed therein). No Group Member has
any material Guarantee Obligations, or any unusual forward or long-term
commitments, including any interest rate or foreign currency swap or exchange
transaction or other obligation in respect of derivatives, that are not
reflected in the most recent financial statements referred to in this paragraph.
During the period from December 31, 2005 to and including the date hereof there
has been no Disposition by any Group Member of any material part of the business
or property of the Group Members taken as a whole.
 
4.2   No Change. Since December 31, 2005, there has been no development or event
that has had or could reasonably be expected to have a Material Adverse Effect.
 
4.3   Existence; Compliance with Law. Each Group Member (a) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, except where (other than the Borrower) the failure to be so
organized, existing or in good standing could not reasonably be expected to have
a Material Adverse Effect, (b) has the power and authority, and the legal right,
to own and operate its property, to lease the property it operates as lessee and
to conduct the business in which it is currently engaged, except where failure
to have such power, authority and legal right could not reasonably be expected
to have a Material Adverse Effect, (c) is duly qualified as a foreign
corporation or other organization and in good standing or has applied for
authority to operate as a foreign corporation under the laws of each
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires such qualification and where a failure to be in good
standing as a foreign corporation would have a Material Adverse Effect and (d)
is in compliance with all Requirements of Law except to
 
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the extent that the failure to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.
 
4.4   Power; Authorization; Enforceable Obligations. Each Loan Party has the
power and authority, and the legal right, to make, deliver and perform the Loan
Documents to which it is a party and, in the case of the Borrower, to obtain
extensions of credit hereunder. Each Loan Party has taken all necessary
organizational action to authorize the execution, delivery and performance of
the Loan Documents to which it is a party and, in the case of the Borrower, to
authorize the extensions of credit on the terms and conditions of this
Agreement. No consent or authorization of, filing with, notice to or other act
by or in respect of, any Governmental Authority or any other Person is required
in connection with the extensions of credit hereunder or with the execution,
delivery, performance, validity or enforceability of this Agreement or any of
the Loan Documents, except (i) consents, authorizations, filings and notices
described in Schedule 4.4, which consents, authorizations, filings and notices
have been obtained or made and are in full force and effect and (ii) the filings
referred to in Section 4.17. Each Loan Document has been duly executed and
delivered on behalf of each Loan Party party thereto. This Agreement
constitutes, and each other Loan Document upon execution will constitute, a
legal, valid and binding obligation of each Loan Party party thereto,
enforceable against each such Loan Party in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
 
4.5   No Legal Bar. The execution, delivery and performance of this Agreement
and the other Loan Documents, the issuance of Letters of Credit, the borrowings
hereunder and the use of the proceeds thereof will not violate any material
Requirement of Law or any material Contractual Obligation of any Group Member
and will not result in, or require, the creation or imposition of any Lien on
any of their respective properties or revenues pursuant to any Requirement of
Law or any such Contractual Obligation (other than the Liens created by the
Security Documents). No Requirement of Law or Contractual Obligation applicable
to the Borrower or any of its Subsidiaries could reasonably be expected to have
a Material Adverse Effect.
 
4.6   Litigation. Except as disclosed by the Borrower to the Lenders in writing
at least three Business Days prior to the Closing Date, there shall not exist
any action, investigation, litigation or proceeding pending or, to the knowledge
of the Borrower, threatened in any court or before any arbitrator or
Governmental Authority that if adversely determined would have a Material
Adverse Effect.
 
4.7   No Default. No Group Member is in default under or with respect to any of
its Contractual Obligations in any respect that could reasonably be expected to
have a Material Adverse Effect. No Default or Event of Default has occurred and
is continuing.
 
4.8   Ownership of Property; Liens. Each Group Member has title in fee simple
to, or a valid leasehold interest in, all its real property (except as could not
reasonably be expected to have a Material Adverse Effect) and none of such
property is subject to any Lien except a Permitted Lien.
 
4.9   Intellectual Property. Each Group Member owns, or is licensed to use, to
its knowledge, all material Intellectual Property necessary for the conduct of
its business as currently conducted. Except as set forth on Schedule 4.9, to
each Group Member’s knowledge, no claim has been asserted and is pending against
such Group Member by any Person challenging or questioning the use of any
Intellectual Property or the validity or effectiveness of any Intellectual
Property, nor does Holdings or the Borrower know of any valid basis for any such
claim that if adversely determined could have a material adverse effect on the
value of any material Intellectual Property owned by such Group Member.
 
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Subject to the foregoing sentence, the use of Intellectual Property by each
Group Member does not infringe, to its knowledge, on the rights of any Person in
any material respect.
 
4.10   Taxes. Each Group Member has filed or caused to be filed all federal,
state and local income and other material tax returns that are required to be
filed by it and has paid all taxes shown to be due and payable on said returns
or on any assessments made against it or any of its property and all other
taxes, fees or other charges imposed on it or any of its property by any
Governmental Authority (other than any amount the validity of which is currently
being contested in good faith by appropriate proceedings and with respect to
which reserves in conformity with GAAP have been provided on the books of the
relevant Group Member or to the extent that failure to do so could not
reasonably be expected to result in a Material Adverse Effect) or with respect
to which the failure to have filed such tax returns or have paid such taxes
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
 
4.11   Federal Regulations. No part of the proceeds of any Loans, and no other
extensions of credit hereunder, will be used (a) for “buying” or “carrying” any
“margin stock” within the respective meanings of each of the quoted terms under
Regulation U as now and from time to time hereafter in effect for any purpose
that violates the provisions of the Regulations of the Board or (b) for any
purpose that violates the provisions of the Regulations of the Board. If
requested by any Lender or the Administrative Agent, the Borrower will furnish
to the Administrative Agent and each Lender a statement to the foregoing effect
in conformity with the requirements of FR Form G-3 or FR Form U-1, as
applicable, referred to in Regulation U.
 
4.12   ERISA. (a) Neither a Reportable Event nor an “accumulated funding
deficiency” (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code; (b) no termination of a Single Employer Plan has occurred, and no
Lien in favor of the PBGC or a Plan has arisen, during such five-year period;
(c) the present value of all accrued benefits under each Single Employer Plan
(based on those assumptions used to fund such Plans) did not, as of the last
annual valuation date prior to the date on which this representation is made or
deemed made, exceed the value of the assets of such Plan allocable to such
accrued benefits by a material amount; (d) neither the Borrower nor any Commonly
Controlled Entity has had a complete or partial withdrawal from any
Multiemployer Plan that has resulted or could reasonably be expected to result
in a liability under ERISA, and neither the Borrower nor any Commonly Controlled
Entity would become subject to any material liability under ERISA if the
Borrower or any such Commonly Controlled Entity were to withdraw completely from
all Multiemployer Plans as of the valuation date most closely preceding the date
on which this representation is made or deemed made; and (e) no such
Multiemployer Plan is in Reorganization or Insolvent, except where, in each of
clauses (a) through (e), such event or condition, together with all other events
or conditions, could not reasonably be expected to have a Material Adverse
Effect.
 
4.13   Investment Company Act; Other Regulations. No Loan Party is an
“investment company”, or a company “controlled” by an “investment company”,
within the meaning of the Investment Company Act of 1940, as amended.
 
4.14   Subsidiaries. As of the Closing Date, (a) Schedule 4.14 sets forth the
name and jurisdiction of organization of each Subsidiary and, (i) as to each
such Subsidiary (other than WTH Funding LP), the percentage of each class of
Capital Stock owned by any Loan Party and (ii) in the case of WTH Funding LP,
the names of the partners of such partnership and to the extent that the
partners of such partnership are Subsidiaries, the percentage of Capital Stock
of such Subsidiaries owned by any Loan Party and (b) there are no outstanding
subscriptions, options, warrants, calls, rights or other
 
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agreements or commitments (other than stock options granted to employees or
directors and directors’ qualifying shares) of any nature relating to any
Capital Stock of the Borrower or any Subsidiary (other than WTH Funding LP),
except as created by the Loan Documents.
 
4.15   Use of Proceeds. The proceeds of the Term Loans shall be used (i) to
repay AESOP Indebtedness, (ii) to pay costs and expenses in connection with the
entering into of the Loan Documents and the issuance of the Senior Unsecured
Notes and (iii) to finance the working capital needs and general corporate
purposes of the Borrower and its Subsidiaries. The proceeds of the Revolving
Loans and the Swingline Loans, and the Letters of Credit, shall be used to
finance the working capital needs and general corporate purposes of the Borrower
and its Subsidiaries.
 
4.16   Accuracy of Information, etc. No statement or information (other than the
projections and pro forma financial information) contained in this Agreement,
any other Loan Document, the Confidential Information Memorandum or any other
document, certificate or statement furnished by or on behalf of any Loan Party
to the Administrative Agent or the Lenders, or any of them, for use in
connection with the transactions contemplated by this Agreement or the other
Loan Documents taken as a whole, contained as of the date such statement,
information, document or certificate was so furnished (or, in the case of the
Confidential Information Memorandum, as of the date of this Agreement), any
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements contained herein or therein not misleading. The
projections and pro forma financial information contained in the materials
referenced above are based upon good faith estimates and assumptions believed by
management of the Borrower to be reasonable at the time made, it being
recognized by the Lenders that such financial information as it relates to
future events is not to be viewed as fact and that actual results during the
period or periods covered by such financial information may differ from the
projected results set forth therein by a material amount. As of the Closing Date
there is no fact known to any Loan Party that could reasonably be expected to
have a Material Adverse Effect that has not been expressly disclosed herein, in
the other Loan Documents, in the Confidential Information Memorandum or in any
other documents, certificates and statements furnished to the Administrative
Agent and the Lenders for use in connection with the transactions contemplated
hereby and by the other Loan Documents.
 
4.17   Security Documents. The Guarantee and Collateral Agreement is effective
to create in favor of the Administrative Agent, for the benefit of the Secured
Parties (as defined in the Guarantee and Collateral Agreement), a legal, valid
and enforceable security interest in the Collateral described therein and
proceeds thereof. In the case of the Pledged Stock described in the Guarantee
and Collateral Agreement, when stock certificates representing such Pledged
Stock are delivered to the Administrative Agent, and in the case of the other
Collateral described in the Guarantee and Collateral Agreement, when financing
statements and other filings specified on Schedule 4.17 in appropriate form are
filed in the offices specified on Schedule 4.17, the Guarantee and Collateral
Agreement shall constitute a fully perfected Lien on, and security interest in,
all right, title and interest of the Loan Parties in such Collateral and the
proceeds thereof, as security for the Obligations (as defined in the Guarantee
and Collateral Agreement), in each case prior and superior in right to any other
Person (except (i) in the case of Collateral other than Pledged Stock, Permitted
Liens and (ii) in the case of Pledged Stock, statutory Liens).
 
4.18   Certain Documents. The Borrower has delivered to the Administrative Agent
a complete and correct copy of the Senior Unsecured Note Indenture and such
other documents as the Administrative Agent shall have reasonably requested.
 
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SECTION 5.  CONDITIONS PRECEDENT
 
5.1   Conditions to Initial Extension of Credit. The agreement of each Lender to
make the initial extension of credit requested to be made by it is subject to
the satisfaction, prior to or concurrently with the making of such extension of
credit on the Closing Date, of the following conditions precedent:
 
(a)  Credit Agreement; Guarantee and Collateral Agreement. The Administrative
Agent shall have received (i) this Agreement, executed and delivered by the
Administrative Agent, Holdings, the Borrower and each Person listed on Schedule
1.1A and (ii) the Guarantee and Collateral Agreement, executed and delivered by
Holdings, the Borrower and each Subsidiary Guarantor.
 
(b)  Senior Unsecured Notes Issuance. The Borrower and Avis Budget Finance shall
have received at least $1,000,000,000 in gross cash proceeds from the issuance
of the Senior Unsecured Notes on terms and conditions reasonably satisfactory to
the Joint Arrangers.
 
(c)  Pro Forma Balance Sheet; Financial Statements. The Lenders shall have
received (i) the Pro Forma Balance Sheet, (ii) the Consolidated Financial
Statements and (iii) unaudited interim consolidated financial statements of the
Borrower for each fiscal quarter ended more than 45 days before the Closing Date
and after the date of the latest applicable financial statements delivered
pursuant to clause (ii) of this paragraph as to which such financial statements
are available, and such financial statements shall not, in the reasonable
judgment of the Lenders, reflect any material inconsistency with the financial
statements or projections contained in the Confidential Information Memorandum,
except as a result of changes thereto required by GAAP.
 
(d)  Projections. The Lenders shall have received satisfactory projections
through 2011.
 
(e)  Approvals. All material governmental and third party approvals necessary in
connection with the continuing operations of the Group Members, the issuance of
the Senior Unsecured Notes and the financing contemplated hereby shall have been
obtained and be in full force and effect, and all applicable waiting periods
shall have expired without any action being taken or threatened by any competent
authority that would restrain, prevent or otherwise impose adverse conditions on
the issuance of the Senior Unsecured Notes or the financing contemplated hereby.
 
(f)  Lien Searches. The Administrative Agent shall have received the results of
a recent lien search in each jurisdiction where the Loan Parties have their
chief executive office or are organized, and such search shall reveal no Liens
on any of the assets of the Loan Parties except for Liens permitted by Section
7.3, Liens discharged on or prior to the Closing Date or Liens for which
termination arrangements have been made pursuant to documentation and on terms
satisfactory to the Administrative Agent.
 
(g)  Fees. The Lenders and the Administrative Agent shall have received all fees
required to be paid, and all expenses for which invoices have been presented
(including the reasonable fees and expenses of legal counsel), on or before the
Closing Date. All such amounts will be paid with proceeds of Loans made on the
Closing Date and will be reflected in the funding instructions given by the
Borrower to the Administrative Agent on or before the Closing Date.
 
(h)  Closing Certificate; Certified Certificate of Incorporation; Good Standing
Certificates. The Administrative Agent shall have received (i) a certificate of
each Loan Party,
 
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dated the Closing Date, substantially in the form of Exhibit C, with appropriate
insertions and attachments, including the certificate of incorporation of each
Loan Party that is a corporation certified by the relevant authority of the
jurisdiction of organization of such Loan Party, and (ii) a long form good
standing certificate for each Loan Party from its jurisdiction of organization.
 
(i)  Legal Opinions. The Administrative Agent shall have received the executed
legal opinion of Skadden, Arps, Slate, Meagher & Flom LLP, counsel to the
Borrower and its Subsidiaries, substantially in the form of Exhibit E.
 
(j)  Pledged Stock; Stock Powers; Pledged Notes. The Administrative Agent shall
have received (i) the certificates representing the shares of Capital Stock
pledged pursuant to the Guarantee and Collateral Agreement, together with an
undated stock power for each such certificate executed in blank by a duly
authorized officer of the pledgor thereof and (ii) each promissory note (if any)
pledged to the Administrative Agent pursuant to the Guarantee and Collateral
Agreement endorsed (without recourse) in blank (or accompanied by an executed
transfer form in blank) by the pledgor thereof.
 
(k)  Filings, Registrations and Recordings. Each document (including any Uniform
Commercial Code financing statement) required by the Security Documents or under
law or reasonably requested by the Administrative Agent to be filed, registered
or recorded in order to create in favor of the Administrative Agent, for the
benefit of the Lenders, a perfected Lien on the Collateral described therein,
prior and superior in right to any other Person (other than with respect to
Liens expressly permitted by Section 7.3), shall be in proper form for filing,
registration or recordation.
 
(l)  Solvency Opinion. The Administrative Agent shall have received a
satisfactory solvency opinion from Duff & Phelps LLC that shall document the
solvency of the Borrower and its Subsidiaries after giving effect to the
financing contemplated hereby and the issuance of the Senior Unsecured Notes.
 
(m)  Officer’s Certificate. The Lenders shall have received a certificate from
the chief financial officer of the Borrower documenting the Borrower’s
compliance with the conditions set forth in paragraphs (a) and (b) of Section
5.2 on a pro forma basis after giving effect to the financing contemplated
hereby and the issuance of the Senior Unsecured Notes.
 
5.2   Conditions to Each Extension of Credit. The agreement of each Lender to
make any extension of credit requested to be made by it on any date (including
its initial extension of credit) is subject to the satisfaction of the following
conditions precedent:
 
(a)  Representations and Warranties. Each of the representations and warranties
made by any Loan Party in or pursuant to the Loan Documents shall be true and
correct in all material respects on and as of such date as if made on and as of
such date.
 
(b)  No Default. No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the extensions of credit
requested to be made on such date.
 
(c)  Extensions of Credit to a Subsidiary Borrower. The representations and
warranties contained in Sections 4.3, 4.4 and 4.5 as to any Subsidiary Borrower
to which an extension of credit is to be made shall be true and correct in all
material respects on and as of such date as if made on and as of such date.
 
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Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower
or any Subsidiary Borrower hereunder shall constitute a representation and
warranty by the Borrower, or such Subsidiary Borrower, as applicable, as of the
date of such extension of credit that the conditions contained in this Section
5.2 have been satisfied.
 
SECTION 6.  AFFIRMATIVE COVENANTS
 
Holdings and the Borrower hereby jointly and severally agree that, so long as
the Commitments remain in effect, any Letter of Credit remains outstanding or
any Loan or other amount is owing to any Lender or the Administrative Agent
hereunder, each of Holdings and the Borrower shall and shall cause each of its
Subsidiaries to:
 
6.1   Financial Statements. Furnish to the Administrative Agent and each Lender:
 
(a)  as soon as available, but in any event within 100 days after the end of
each fiscal year of the Borrower, a copy of the audited consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at the end of such
year and the related audited consolidated statements of income and of cash flows
for such year, setting forth in each case in comparative form the figures for
the previous year, reported on without a “going concern” or like qualification
or exception, or qualification arising out of the scope of the audit, by
Deloitte & Touche LLP or other independent certified public accountants of
nationally recognized standing; and
 
(b)  as soon as available, but in any event not later than 55 days after the end
of each of the first three quarterly periods of each fiscal year of the
Borrower, the unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated statements of income and of cash flows for such quarter
and the portion of the fiscal year through the end of such quarter, setting
forth in each case in comparative form the figures for the previous year,
certified by a Responsible Officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments).
 
All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied (except as approved by such accountants or officer, as the case may be,
and disclosed in reasonable detail therein) consistently throughout the periods
reflected therein and with prior periods and shall be deemed to have been
delivered on the date on which the Borrower provides notice to the
Administrative Agent that such information has been posted on the Borrower’s
website at the website address listed on the signature pages of such notice, at
www.sec.gov or at such other website identified in such notice and accessible by
the Lenders without charge; provided that the Borrower shall deliver paper
copies of such financial statements to the Administrative Agent or any Lender
who requests the Borrower to deliver such paper copies until written notice to
cease delivering paper copies is given by the Administrative Agent or such
Lender. The Borrower will be deemed to have satisfied the requirements of this
Section 6.1 if any parent files with the SEC and provides reports, documents and
information of the types otherwise so required, in each case within the
applicable time periods specified by the applicable rules and regulations of the
SEC, and the Borrower is not required to file such reports, documents and
information separately under the applicable rules and regulations of the SEC
(after giving effect to any exemptive relief) because of the filings by such
parent.
 
6.2   Certificates; Other Information. Furnish to the Administrative Agent and
each Lender (or, in the case of clause (d), to the relevant Lender):
 
(a)  concurrently with the delivery of the financial statements referred to in
Section 6.1(a), a letter, written and signed by the independent certified public
accountants reporting on
 
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such financial statements describing the scope of such financial statements and
certifying that such financial statements are presented in an accurate manner
and in accordance with GAAP;
 
(b)  concurrently with the delivery of any financial statements pursuant to
Section 6.1, (i) a certificate of a Responsible Officer stating that, to the
best of each such Responsible Officer’s knowledge, each Loan Party during such
period has observed or performed all of its covenants and other agreements, and
satisfied every condition contained in this Agreement and the other Loan
Documents to which it is a party to be observed, performed or satisfied by it,
and that such Responsible Officer has obtained no knowledge of any Default or
Event of Default except as specified in such certificate and (ii) in the case of
quarterly or annual financial statements, (x) a Compliance Certificate
containing all information and calculations necessary for determining compliance
by each Group Member with the provisions of this Agreement referred to therein
as of the last day of the fiscal quarter or fiscal year of the Borrower, as the
case may be, and (y) to the extent not previously disclosed to the
Administrative Agent, (1) a description of any change in the jurisdiction of
organization of any Loan Party and the name and jurisdiction of organization of
any new Subsidiary and the percentage of each class of Capital Stock owned by
any Loan Party and (2) a list of any Intellectual Property registrations and
applications acquired by any Loan Party since the date of the most recent report
delivered pursuant to this clause (y) (or, in the case of the first such report
so delivered, since the Closing Date);
 
(c)  as soon as available, and in any event no later than 45 days after the end
of each fiscal year of the Borrower, a consolidated budget for the following
fiscal year and, as soon as available, significant revisions, if any, of such
budget with respect to such fiscal year (the “Budget”), which Budget shall in
each case be accompanied by a certificate of a Responsible Officer stating that
such Budget is based on reasonable estimates, information and assumptions and
that such Responsible Officer has no reason to believe that such Budget is
incorrect or misleading in any material respect, it being understood that such
Budget is based upon good faith estimates and assumptions believed by management
of the Borrower to be reasonable at the time made, and it being recognized by
the Lenders that such financial information as it relates to future events is
not to be viewed as fact and that actual results during the period or periods
covered by such financial information may differ from Budget by a material
amount; and
 
(d)  promptly, such additional financial and other information as any Lender may
from time to time reasonably request.
 
6.3   Payment of Obligations. Pay, discharge or otherwise satisfy at or before
maturity or before they become delinquent, as the case may be, its obligations
and liabilities in respect of taxes, assessments and governmental charges or
levies imposed upon it or upon its income or profits or in respect of its
property, except where the amount or validity thereof is currently being
contested in good faith by appropriate proceedings and reserves in conformity
with GAAP with respect thereto have been provided on the books of the relevant
Group Member or except to the extent that failure to do so could not reasonably
be expected to result in a Material Adverse Effect.
 
6.4   Maintenance of Existence; Compliance. (a)(i) Preserve, renew and keep in
full force and effect its organizational existence (provided that Holdings and
any of its Subsidiaries may change its organizational form so long as such
change shall not adversely affect the interests of the Lenders) and (ii) take
all reasonable action to maintain all rights, privileges and franchises
necessary or desirable in the normal conduct of its business, except, in each
case, as otherwise permitted by Section 7.4 and except to the extent that
failure to do so could not reasonably be expected to have a Material Adverse
Effect; and (b) comply with all Contractual Obligations and Requirements of Law
except to the extent
 
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that failure to comply therewith could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect.
 
6.5   Maintenance of Property; Insurance. (a)  Keep all property material to its
business in good working order and condition consistent with industry practices,
ordinary wear and tear excepted, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect and (b) maintain with
financially sound and reputable insurance companies insurance on all its
material property in amounts and against such risks (but including in any event,
to the extent available on commercially reasonable terms, public liability,
product liability and business interruption) as are usually insured against in
the same general area by companies engaged in the same or a similar business.
 
6.6   Inspection of Property; Books and Records; Discussions. (a) Keep proper
books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities and (b) permit the
Administrative Agent, and after the occurrence and during the continuance of an
Event of Default, representatives of any Lender (in coordination with the
Administrative Agent), to visit and inspect any of its properties and examine
and make abstracts from any of its books and records at any reasonable time and
upon reasonable advance notice, and to discuss the business, operations,
properties and financial and other condition of the Group Members with officers
and employees of the Group Members and with their independent certified public
accountants; provided that a representative of the Loan Parties shall be
permitted to be present for any discussion with independent certified
accountants referred to above. Notwithstanding Section 10.5, unless any such
visit or inspection is conducted after the occurrence and during the continuance
of a Default or Event of Default, the Borrower shall not be required to pay any
costs or expenses incurred by the Administrative Agent, any Lender or Lender’s
representative in connection with such visit or inspection.
 
6.7   Notices. Promptly upon obtaining actual knowledge thereof, give notice to
the Administrative Agent and each Lender of:
 
(a)  the occurrence of any Default or Event of Default;
 
(b)  any (i) default or event of default under any Contractual Obligation of any
Group Member or (ii) litigation, investigation or proceeding that may exist at
any time between any Group Member and any Governmental Authority, that in either
case, if not cured or if adversely determined, as the case may be, could
reasonably be expected to have a Material Adverse Effect;
 
(c)   any litigation or proceeding affecting any Group Member (i) in which the
amount involved is $50,000,000 or more and not covered by insurance, (ii) in
which injunctive or similar relief is sought or (iii) which relates to any Loan
Document;
 
(d)  the following events, as soon as possible and in any event within 30 days
after the Borrower knows or has reason to know thereof: (i) the occurrence of
any Reportable Event with respect to any Plan, a failure to make any required
contribution to a Plan, the creation of any Lien in favor of the PBGC or a Plan
or any withdrawal from, or the termination, Reorganization or Insolvency of, any
Multiemployer Plan or (ii) the institution of proceedings or the taking of any
other action by the PBGC or the Borrower or any Commonly Controlled Entity or
any Multiemployer Plan with respect to the withdrawal from, or the termination,
Reorganization or Insolvency of, any Plan; and
 
(e)  any development or event that has had or could reasonably be expected to
have a Material Adverse Effect.
 
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Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the relevant Group Member proposes to take with
respect thereto.
 
6.8   Environmental Laws. (a) Comply with, and use commercially reasonable
efforts to ensure compliance by all tenants and subtenants, if any, with, all
applicable Environmental Laws, and obtain and comply with and maintain, and use
commercially reasonable efforts to ensure that all tenants and subtenants obtain
and comply with and maintain, any and all licenses, approvals, binding
notifications, registrations or permits required by applicable Environmental
Laws, except where the failure to do so could not reasonably be expected to have
a Material Adverse Effect.
 
(b)   Conduct and complete all investigations, studies, sampling and testing,
and all remedial, removal and other actions required under Environmental Laws
and promptly comply with all lawful orders and directives of all Governmental
Authorities regarding Environmental Laws, except where the failure to do so
could not reasonably be expected to have a Material Adverse Effect.
 
6.9   Additional Collateral, etc. (a)  With respect to any property constituting
Collateral described in the Guarantee and Collateral Agreement acquired after
the Closing Date by any Loan Party as to which the Administrative Agent, for the
benefit of the Lenders, does not have a perfected Lien, promptly (i) execute and
deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement or such other documents as the Administrative Agent deems
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Lenders, a security interest in such property and (ii) take all actions
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Lenders, a perfected first priority security interest in such property,
including the filing of Uniform Commercial Code financing statements in such
jurisdictions as may be required by the Guarantee and Collateral Agreement or by
law or as may be requested by the Administrative Agent; provided that the Loan
Parties shall not be required to take any such action with respect to any
Intellectual Property acquired after the Closing Date until the earlier of the
date on which (i) the aggregate value of all such Intellectual Property with
respect to which the actions described above have not already been taken shall
be at least $10,000,000 or (ii) the list describing such Intellectual Property
is required to be furnished to the Administrative Agent and each Lender pursuant
to Section 6.2(b).
 
(b)   With respect to any new Subsidiary (other than a Foreign Subsidiary, an
Excluded Subsidiary, a Securitization Entity or any Subsidiary of a Foreign
Subsidiary, Excluded Subsidiary or Securitization Entity) created or acquired
after the Closing Date by any Loan Party, promptly (i) execute and deliver to
the Administrative Agent such amendments to the Guarantee and Collateral
Agreement as the Administrative Agent deems necessary or advisable to grant to
the Administrative Agent, for the benefit of the Lenders, a perfected first
priority security interest in the Capital Stock of such new Subsidiary that is
owned by any Loan Party, (ii) deliver to the Administrative Agent the
certificates representing such Capital Stock, together with undated stock
powers, in blank, executed and delivered by a duly authorized officer of the
relevant Loan Party, (iii) cause such new Subsidiary (A) to become a party to
the Guarantee and Collateral Agreement, (B) to take such actions necessary or
advisable to grant to the Administrative Agent for the benefit of the Lenders a
perfected first priority security interest in the Collateral described in the
Guarantee and Collateral Agreement with respect to such new Subsidiary,
including the filing of Uniform Commercial Code financing statements in such
jurisdictions as may be required by the Guarantee and Collateral Agreement or by
law or as may be requested by the Administrative Agent and (C) to deliver to the
Administrative Agent a certificate of such Subsidiary, substantially in the form
of Exhibit C, with appropriate insertions and attachments, and (iv) if
reasonably requested by the Administrative Agent, deliver to the Administrative
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.
 
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(c)    With respect to any new Foreign Subsidiary created or acquired after the
Closing Date by any Loan Party (other than by any Foreign Subsidiary, an
Excluded Subsidiary or a Securitization Entity), promptly (i) execute and
deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement as the Administrative Agent deems necessary or advisable to
grant to the Administrative Agent, for the benefit of the Lenders, a perfected
first priority security interest in a portion of the Capital Stock of such new
Subsidiary that is owned by any such Loan Party (provided that in no event shall
more than 66% of the total outstanding voting Capital Stock of any such new
Subsidiary be required to be so pledged), (ii) deliver to the Administrative
Agent the certificates representing such Capital Stock, together with undated
stock powers, in blank, executed and delivered by a duly authorized officer of
the relevant Group Member, and take such other action as may be necessary or, in
the opinion of the Administrative Agent, desirable to perfect the Administrative
Agent’s security interest therein, and (iii) if reasonably requested by the
Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.
 
SECTION 7.  NEGATIVE COVENANTS

 
Holdings and the Borrower hereby jointly and severally agree that, so long as
the Commitments remain in effect, any Letter of Credit remains outstanding or
any Loan or other amount is owing to any Lender or the Administrative Agent
hereunder, each of Holdings and the Borrower shall not, and shall not permit any
of its Subsidiaries to, directly or indirectly:
 
7.1   Financial Condition Covenants.

(a)   Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio as at
the last day of any period of four consecutive fiscal quarters of the Borrower
ending with any fiscal quarter after June 30, 2006 set forth below to exceed the
ratio set forth below opposite such fiscal quarter:
 
Fiscal Quarter
 
Consolidated
Leverage Ratio
                                          Closing Date until
September 30, 2007
 
5.50 to 1.00
September 30, 2008
5.25 to 1.00
September 30, 2009
4.75 to 1.00
September 30, 2010
4.25 to 1.00
                                          December 31, 2010
                                          and thereafter
 
4.00 to 1.00

 
; provided, that for the purposes of determining the ratio described above for
the fiscal quarters of the Borrower ending September 30, 2006 and December 31,
2006, Consolidated EBITDA for the relevant period shall be deemed to equal
Consolidated EBITDA for such fiscal quarter and, each previous fiscal quarter
commencing after the Closing Date multiplied by 2 and 4/3, respectively.
 
(b)   Consolidated Interest Coverage Ratio. Permit the Consolidated Interest
Coverage Ratio for any period of four consecutive fiscal quarters of the
Borrower (or, if less, the number of full fiscal quarters subsequent to the
Closing Date) ending with any fiscal quarter after June 30, 2006 set forth below
to be less than the ratio set forth below opposite such fiscal quarter:
 
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Fiscal Quarter
 
Consolidated
Interest Coverage Ratio
                                        Closing Date until
September 30, 2008
 
2.25 to 1.00
September 30, 2009
2.50 to 1.00
September 30, 2010
2.75 to 1.00
December 31, 2010
and thereafter
 
3.00 to 1.00

 
7.2   Indebtedness. Create, issue, incur, assume, become liable in respect of or
suffer to exist any Indebtedness, except:
 
(a)  Indebtedness of any Loan Party pursuant to any Loan Document;
 
(b)  Indebtedness of the Borrower to any Subsidiary and of any Subsidiary
Guarantor to the Borrower or any other Subsidiary;
 
(c)  Guarantee Obligations of the Borrower, Holdings and any Subsidiary of the
Borrower in respect of the Guarantee and Collateral Agreement;
 
(d)  Guarantee Obligations incurred in the ordinary course of business by the
Borrower or any of its Subsidiaries of obligations of any Subsidiary Guarantor
or the Borrower;
 
(e)  Guarantee Obligations of the Borrower in respect of obligations under the
Letter of Credit Facilities;
 
(f)  Indebtedness outstanding on the date hereof or required to be incurred
pursuant to a Contractual Obligation in existence on the date hereof (other than
AESOP Indebtedness and Securitization Indebtedness) and listed on Schedule
7.2(f) and any Permitted Refinancing thereof;
 
(g)  Indebtedness (including, without limitation, Capital Lease Obligations)
secured by Liens permitted by Section 7.3(h) in an aggregate principal amount
not to exceed $100,000,000 at any one time outstanding;
 
(h)  Indebtedness of the Borrower and Avis Budget Finance in respect of the
Senior Unsecured Notes and any Permitted Refinancing thereof;
 
(i)  unsecured Guarantee Obligations of Holdings and any Subsidiary of the
Borrower in respect of the Senior Unsecured Notes.
 
(j)  AESOP Indebtedness;
 
(k)  Securitization Indebtedness;
 
(l)  Recourse Vehicle Indebtedness;
 
(m)  Indebtedness incurred in connection with any acquisition by the Borrower or
any of its Subsidiaries of vehicles directly from a manufacturer pursuant to
such manufacturer’s repurchase program; provided that (i) such Indebtedness is
not greater than the net book value of such vehicles and (ii) such vehicles
could not be financed under the AESOP Financing Program;
 
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(n)  Indebtedness incurred pursuant to terminal rental adjustment clause lease
financings of trucks to be used in the truck rental operations of the Borrower
and its Subsidiaries;
 
(o)  Indebtedness under any Swap Agreement;
 
(p)  Indebtedness of any Foreign Subsidiary, Excluded Subsidiary or
Securitization Entity to the Borrower or any Subsidiary Guarantor incurred in
the ordinary course of business or to satisfy the general financing needs of
such Foreign Subsidiary, Excluded Subsidiary or Securitization Entity;
 
(q)  Indebtedness of any Foreign Subsidiary, Excluded Subsidiary or
Securitization Entity to the Borrower or any Subsidiary Guarantor in an amount
not to exceed $50,000,000 during the term of this Agreement;
 
(r)  Indebtedness of any Foreign Subsidiary, Excluded Subsidiary or
Securitization Entity to any Foreign Subsidiary, Excluded Subsidiary or
Securitization Entity;
 
(s)  Guarantee Obligations incurred by any Foreign Subsidiary, Excluded
Subsidiary or Securitization Entity in respect of Indebtedness of any Foreign
Subsidiary, Excluded Subsidiary or Securitization Entity;
 
(t)  Indebtedness of any Foreign Subsidiary in an aggregate principal amount not
to exceed $50,000,000 at any one time outstanding;
 
(u)  Indebtedness of any Person that becomes a Subsidiary pursuant to a
Permitted Acquisition or that is otherwise assumed by the Borrower or any of its
Subsidiaries in connection with a Permitted Acquisition which is not incurred in
contemplation of such Permitted Acquisition and any Permitted Refinancing
thereof;
 
(v)  unsecured or subordinated Indebtedness of the Borrower, Holdings or any
Subsidiary Guarantor of the Borrower having no scheduled principal payments or
prepayments prior to the Term Loan Maturity Date incurred in connection with
Permitted Acquisitions and any Permitted Refinancing thereof;
 
(w)  additional Indebtedness of the Borrower or any of its Subsidiaries in an
aggregate principal amount (for the Borrower and all Subsidiaries) not to exceed
$50,000,000 at any one time outstanding; and
 
(x)  additional unsecured or subordinated Indebtedness of the Borrower, Holdings
or any Subsidiary Guarantor having no scheduled principal payments or
prepayments prior to the Term Loan Maturity Date;
 
provided, that if the Group Member’s action or event meets the criteria of more
than one of the types of Indebtedness described in the clauses above, the
Borrower in its sole discretion may classify such action or event in one or more
clauses (including in part under one such clause and in part under another such
clause).
 
7.3   Liens. Create, incur, assume or suffer to exist any Lien upon any of its
property, whether now owned or hereafter acquired, except:
 
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(a)  Liens for taxes, assessments, governmental charges or other similar
obligations not yet due or that are being contested in good faith by appropriate
proceedings, provided that adequate reserves with respect thereto are maintained
on the books of the Borrower or its Subsidiaries, as the case may be, in
conformity with GAAP;
 
(b)  carriers’, warehousemen’s, mechanics’, landlord’s, materialmen’s,
repairmen’s or other like Liens arising in the ordinary course of business that
are not overdue for a period of more than 60 days or that are being contested in
good faith by appropriate proceedings;
 
(c)  Liens incidental to the conduct of the Borrower’s business or the ownership
of its assets which were not incurred in connection with the borrowing of money,
and which do not in the aggregate materially detract from the value of its
assets or materially impair the use thereof in the operation of its business;
 
(d)  pledges or deposits in connection with workers’ compensation, unemployment
insurance and other social security legislation;
 
(e)  pledges or deposits to secure the performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature incurred
in the ordinary course of business;
 
(f)  easements, rights-of-way, restrictions, covenants and other similar
encumbrances incurred in the ordinary course of business or of record that, in
the aggregate, are not substantial in amount and that do not in any case
materially detract from the value of the property subject thereto or materially
interfere with the ordinary conduct of the business of the Borrower or any of
its Subsidiaries;
 
(g)  Liens in existence on the date hereof listed on Schedule 7.3(g), securing
Indebtedness permitted by Section 7.2(f), provided that no such Lien is spread
to cover any additional property after the Closing Date and that the amount of
Indebtedness secured thereby is not increased;
 
(h)  Liens securing Indebtedness of the Borrower or any other Subsidiary
incurred pursuant to Section 7.2(g) to finance the acquisition of fixed or
capital assets, provided that (i) such Liens shall be created substantially
simultaneously with the acquisition of such fixed or capital assets, (ii) such
Liens do not at any time encumber any property other than the property financed
by such Indebtedness and (iii) the amount of Indebtedness secured thereby is not
increased;
 
(i)  Liens created pursuant to the Security Documents;
 
(j)  Liens on any Related Eligible Assets or arising out of the transfer of
Related Eligible Assets to Securitization Entities; provided that such transfer
is otherwise permitted by the Agreement;
 
(k)  Liens securing Indebtedness permitted under Section 7.2(j), (k), (l), (m)
and (n);
 
(l)  Liens securing judgments which do not constitute and Event of Default;
 
(m)  statutory rights of tenants under leases with respect to which the Borrower
or any Subsidiary is the lessor;
 
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(n)  any interest or title of a lessor under any lease entered into by the
Borrower or any other Subsidiary in the ordinary course of its business and
covering only the assets so leased;
 
(o)  Liens existing on any property or asset prior to the acquisition thereof by
any Group Member or existing on any property or asset of any Person that becomes
a Subsidiary after the date hereof prior to the time such Person becomes a
Subsidiary; provided that such Lien is not created in contemplation of or in
connection with such acquisition or such Person becoming a Subsidiary, as the
case may be, and such Lien shall secure only those obligations which it secures
on the date of such acquisition or the date on which such Person becomes a
Subsidiary, as the case may be, and any Permitted Refinancing of such
obligations; provided further that no such Liens shall be permitted to exist on
the Capital Stock of any Person that is required to be a Subsidiary Guarantor
hereunder; and
 
(p)  Liens not otherwise permitted by this Section so long as neither (i) the
aggregate outstanding principal amount of the obligations secured thereby nor
(ii) the aggregate fair market value (determined as of the date such Lien is
incurred) of the assets subject thereto exceeds (as to the Borrower and all
Subsidiaries) $50,000,000 at any one time;
 
provided, that if the Group Member’s action or event meets the criteria of more
than one of the types of Liens described in the clauses above, the Borrower in
its sole discretion may classify such action or event in one or more clauses
(including in part under one such clause and in part under another such clause).
 
7.4   Fundamental Changes. Enter into any merger, consolidation or amalgamation,
or liquidate, wind up or dissolve itself (or suffer any liquidation or
dissolution), or Dispose of all or substantially all of its property or
business, except that:
 
(a)  any Subsidiary of the Borrower may be merged or consolidated with or into
the Borrower (provided that the Borrower shall be the continuing or surviving
corporation) or with or into any Wholly Owned Subsidiary (provided that the
Wholly Owned Subsidiary shall be the continuing or surviving corporation);
provided that any such merger or consolidation of a Subsidiary Guarantor shall
only be with or into the Borrower or another Subsidiary Guarantor;
 
(b)  any Subsidiary of the Borrower may Dispose of any or all of its assets (i)
to the Borrower or any Wholly Owned Subsidiary (upon voluntary liquidation or
otherwise); provided that any such Disposition by a Subsidiary Guarantor shall
only be to the Borrower or another Subsidiary Guarantor or (ii) pursuant to a
Disposition permitted by Section 7.5; and
 
(c)  any Investment expressly permitted by Section 7.7 may be structured as a
merger, consolidation or amalgamation.
 
7.5   Disposition of Property. Dispose of any of its property, whether now owned
or hereafter acquired, or, in the case of any Subsidiary, issue or sell any
shares of such Subsidiary’s Capital Stock to any Person, except:
 
(a)  the Disposition of obsolete or worn out property in the ordinary course of
business;
 
(b)   the sale of inventory in the ordinary course of business;
 
(c)  Dispositions permitted by clause (i) of Section 7.4(b);
 
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(d)  the sale or issuance of any Subsidiary’s Capital Stock to the Borrower or
any Wholly Owned Subsidiary; provided that any sale or issuance of any
Subsidiary Guarantor’s Capital Stock shall only be to the Borrower or another
Subsidiary Borrower;
 
(e)  Dispositions of any Related Eligible Assets (i) in connection with the
AESOP Financing Program, (ii) to any Securitization Entity or (iii) in
connection with the incurrence of any Securitization Indebtedness;
 
(f)  the sale of the Budget Truck Division for fair market value as determined
by the board of directors of the Borrower;
 
(g)  the Disposition of other property having a fair market value not to exceed
$200,000,000 in the aggregate for any fiscal year of the Borrower; and
 
(h)  the Dispositions listed on Schedule 7.5(h).
 
7.6   Restricted Payments. Declare or pay any dividend (other than dividends
payable solely in common stock of the Person making such dividend) on, or make
any payment on account of, or set apart assets for a sinking or other analogous
fund for, the purchase, redemption, defeasance, retirement or other acquisition
of, any Capital Stock of any Group Member, whether now or hereafter outstanding,
or make any other distribution in respect thereof, either directly or
indirectly, whether in cash or property or in obligations of any Group Member
(collectively, “Restricted Payments”), except that:
 
(a)  any Subsidiary may make Restricted Payments to the Borrower or any
Subsidiary Guarantor; provided, that any non-Subsidiary Guarantor may make
Restricted Payments pro rata to any Group Member;
 
(b)   so long as no Default or Event of Default shall have occurred and be
continuing, the Borrower may pay dividends to Holdings and Holdings may pay
dividends to Cendant to purchase Cendant common stock or common stock options
from present or former officers or employees of any Group Member upon the death,
disability or termination of employment of such officer or employee;
 
(c)  the Borrower may make Restricted Payments to Holdings to permit Holdings to
(i) pay corporate overhead expenses incurred in the ordinary course of business
and (ii) pay any taxes that are due and payable by Holdings or the Borrower; and
 
(d)  (i) the Borrower may make Restricted Payments to Holdings to permit
Holdings to pay dividends to any higher tier entity to provide for the payment
of (A) Parent Expenses, (B) Related Taxes and (C) any Taxes that are due and
payable by any Group Member as part of a consolidated group or which have been
paid for the account of any Group Member pursuant to the Tax Sharing Agreement
and (ii) so long as no Default or Event of Default shall have occurred and be
continuing, the Borrower may make Restricted Payments to Holdings to permit
Holdings to pay dividends to any Parent in an aggregate amount not to exceed
$40,000,000 plus 50% of Consolidated Net Income of the Borrower and its
Subsidiaries, determined on a cumulative basis since the Closing Date, during
the term of this Agreement.
 
7.7   Investments. Make any advance, loan, extension of credit (by way of
guaranty or otherwise) or capital contribution to, or purchase any Capital
Stock, bonds, notes, debentures or other debt securities of, or any assets
constituting a business unit of, or make any other investment in, any Person
(all of the foregoing, “Investments”), except:
 
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(a)  extensions of trade credit in the ordinary course of business;
 
(b)  Investments in Cash Equivalents;
 
(c)  Guarantee Obligations permitted by Section 7.2;
 
(d)  loans and advances to employees of any Group Member in the ordinary course
of business (including for travel, entertainment and relocation expenses);
 
(e)  Investments in assets useful in the business of the Borrower and its
Subsidiaries made by the Borrower or any of its Subsidiaries with the proceeds
of any Reinvestment Deferred Amount;
 
(f)  intercompany Investments by any Group Member in the Borrower or any Person
that, prior to such investment, is a Subsidiary Guarantor;
 
(g)  intercompany Investments by the Borrower or any Subsidiary Guarantor in any
Foreign Subsidiary, Excluded Subsidiary or Securitization Entity made in the
ordinary course of business or to satisfy the general financing needs of such
Foreign Subsidiary, Excluded Subsidiary or Securitization Entity;
 
(h)  intercompany Investments by the Borrower or any Subsidiary Guarantor in any
Foreign Subsidiary, Excluded Subsidiary or Securitization Entity in an amount
not to exceed $50,000,000 at any one time outstanding;
 
(i)  intercompany Investments by any Foreign Subsidiary, Excluded Subsidiary or
Securitization Entity in any Foreign Subsidiary, Excluded Subsidiary or
Securitization Entity;
 
(j)  Restricted Payments to Cendant permitted by Section 7.6 in the form of
loans and advances;
 
(k)  Investments listed on Schedule 7.7(k);
 
(l)  Permitted Acquisitions; and
 
(m)  in addition to Investments otherwise expressly permitted by this Section,
Investments by the Borrower or any of its Subsidiaries in an aggregate amount
(valued at cost) not to exceed $200,000,000 during the term of this Agreement;
 
provided, that if the Group Member’s action or event meets the criteria of more
than one of the types of Investments described in the clauses above, the
Borrower in its sole discretion may classify such action or event in one or more
clauses (including in part under one such clause and in part under another such
clause).
 
7.8   Optional Payments and Modifications of Certain Agreements.  (a) Make or
offer to make any optional or voluntary payment, prepayment, repurchase or
redemption of or otherwise optionally or voluntarily defease or segregate funds
with respect to the Indebtedness permitted by Section 7.2(h), (t) or (v);
provided that any such Indebtedness may be repaid, prepaid, repurchased or
redeemed (i) in connection with a Permitted Refinancing or (ii) for
consideration (including any premium paid in connection therewith) in an
aggregate amount of up to $500,000,000, (b) amend, modify, waive or otherwise
change, or consent or agree to any amendment, modification, waiver or other
change to, any of
 
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the terms of the Senior Unsecured Notes in a manner materially adverse to the
Lenders or (c) amend, modify, waive or otherwise change, or consent or agree to
any amendment, modification, waiver or other change to, any of the terms of the
Separation Agreement or the Tax Sharing Agreement in a manner materially adverse
to the Lenders, it being understood that an increase of the obligations or
potential liability of Cendant resulting from any such amendment, modification
or other change to the Separation Agreement or Tax Sharing Agreement shall not,
in and of itself, be regarded as materially adverse to the Lenders.
 
7.9   Transactions with Affiliates. Enter into any transaction (other than
transactions listed on Schedule 7.9), including any purchase, sale, lease or
exchange of property, the rendering of any service or the payment of any
management, advisory or similar fees, with any Affiliate (other than Holdings,
the Borrower or any Subsidiary Guarantor) unless such transaction is
(a) otherwise permitted under this Agreement, (b) in the ordinary course of
business of the relevant Group Member, and (c) upon fair and reasonable terms no
less favorable to the relevant Group Member than it would obtain in a comparable
arm’s length transaction with a Person that is not an Affiliate.
 
7.10   Sales and Leasebacks. Enter into any arrangement with any Person
providing for the leasing by any Group Member of real or personal property that
has been or is to be sold or transferred by such Group Member to such Person or
to any other Person to whom funds have been or are to be advanced by such Person
on the security of such property or rental obligations of such Group Member
except sale-lease back transactions relating to Eligible Assets not in excess of
$50,000,000 and without duplication of any such transactions permitted by
Section 7.2.
 
7.11   Changes in Fiscal Periods. Permit the fiscal year of the Borrower to end
on a day other than December 31 or change the Borrower’s method of determining
fiscal quarters.
 
7.12   Clauses Restricting Subsidiary Distributions. Enter into or suffer to
exist or become effective any consensual encumbrance or restriction on the
ability of any Subsidiary of the Borrower (other than a Securitization Entity)
to (a) make Restricted Payments in respect of any Capital Stock of such
Subsidiary held by, or pay any Indebtedness owed to, the Borrower or any other
Subsidiary of the Borrower, (b) make loans or advances to, or other Investments
in, the Borrower or any other Subsidiary of the Borrower or (c) transfer any of
its assets to the Borrower or any other Subsidiary of the Borrower, except for
such encumbrances or restrictions existing under or by reason of (i) any
restrictions existing under the Loan Documents and (ii) any restrictions with
respect to a Subsidiary imposed pursuant to an agreement that has been entered
into in connection with the Disposition of all or substantially all of the
Capital Stock or assets of such Subsidiary other than the Senior Unsecured Note
Indenture and such other agreements listed on Schedule 7.12.
 
7.13   Lines of Business. Enter into any business, either directly or through
any Subsidiary, except for those businesses in which the Borrower and its
Subsidiaries are engaged on the date of this Agreement or that are reasonably
related thereto.
 
7.14   Business Activities of Holdings. In the case of Holdings, (i) conduct,
transact or otherwise engage in, or commit to conduct, transact or otherwise
engage in, any business or operations other than those incidental to its
ownership of the Capital Stock of the Borrower, (ii) incur, create, assume or
suffer to exist any Indebtedness or other liabilities or financial obligations,
except (w) Guarantee Obligations permitted pursuant to Section 7.2(c) and
7.2(i), (x) nonconsensual obligations imposed by operation of law, (y)
obligations pursuant to the Loan Documents to which it is a party and (z)
obligations with respect to its Capital Stock, or (iii) own, lease, manage or
otherwise operate any properties or assets (including cash (other than cash
received in connection with dividends made by the Borrower in
 
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accordance with Section 7.6 pending application in the manner contemplated by
said Section) and cash equivalents) other than the ownership of shares of
Capital Stock of the Borrower.
 
SECTION 8.  EVENTS OF DEFAULT
 
If any of the following events shall occur and be continuing:
 
(a)  the Borrower or any Subsidiary Borrower shall fail to pay any principal of
any Loan or Reimbursement Obligation when due in accordance with the terms
hereof; or the Borrower or any Subsidiary Borrower shall fail to pay any
interest on any Loan or Reimbursement Obligation, or any other amount payable
hereunder or under any other Loan Document, within five days after any such
interest or other amount becomes due in accordance with the terms hereof; or
 
(b)  any representation or warranty made or deemed made by any Loan Party herein
or in any other Loan Document or that is contained in any certificate, document
or financial or other statement furnished by it at any time under or in
connection with this Agreement or any such other Loan Document shall prove to
have been false or misleading in any material respect on or as of the date made
or delivered; or
 
(c)  any Loan Party shall default in the observance or performance of any
agreement contained in clause (i) or (ii) of Section 6.4(a) (with respect to
Holdings and the Borrower only), Section 6.7(a) or Section 7 of this Agreement
or Sections 6.4 or 6.6(b) of the Guarantee and Collateral Agreement; or
 
(d)  any Loan Party shall default in the observance or performance of any other
agreement contained in this Agreement or any other Loan Document (other than as
provided in paragraphs (a) through (c) of this Section), and such default shall
continue unremedied for a period of 30 days after notice to the Borrower from
the Administrative Agent or the Required Lenders; or
 
(e)  any Group Member shall (i) default in making any payment of any principal
of any Indebtedness (including any Guarantee Obligation, but excluding the
Loans) on the scheduled or original due date with respect thereto; or (ii)
default in making any payment of any interest on any such Indebtedness beyond
the period of grace, if any, provided in the instrument or agreement under which
such Indebtedness was created; or (iii) default in the observance or performance
of any other agreement or condition relating to any such Indebtedness or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event shall occur or condition exist, the effect of which
default or other event or condition is to cause, or to permit the holder or
beneficiary of such Indebtedness (or a trustee or agent on behalf of such holder
or beneficiary) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity or (in the case of any
such Indebtedness constituting a Guarantee Obligation) to become payable;
provided, that a default, event or condition described in clause (i), (ii) or
(iii) of this paragraph (e) shall not at any time constitute an Event of Default
unless, at such time, one or more defaults, events or conditions of the type
described in clauses (i), (ii) and (iii) of this paragraph (e) shall have
occurred and be continuing with respect to Indebtedness (x) the outstanding
principal amount of which exceeds in the aggregate $50,000,000; and (y) in the
case of such Indebtedness which is Securitization Indebtedness (including AESOP
Indebtedness), (1) an amortization or termination event pursuant to a
securitization program prior to the end of the scheduled term or revolving
period thereunder shall have occurred, (2) the Borrower and its Subsidiaries
shall become unable to finance the purchase of vehicles and (3) the Borrower
shall have failed, by the 45th day after the occurrence of an event referred to
in clause (y)(1) and the
 
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expiration of all grace periods applicable thereto, to either (A) replace such
securitization program with an alternative source of financing having terms not
materially adverse to the Lenders from the program being replaced or having
terms acceptable to the Required Lenders, or (B) obtain a waiver with respect to
the occurrence of such event from the applicable required noteholders or lenders
under such securitization program, and provided that until and unless the event
described in clause (y)(3) shall have occurred, no Event of Default shall exist
as a result of the occurrence of an event referred to in clause (y)(1). Upon the
entering into of any replacement facility referred to in clause (y)(1)(A), the
Borrower shall deliver to the Administrative Agent a written officer’s
certificate providing that the Borrower has sufficient vehicle financing
arrangements available to it to carry-on its business activities consistent, in
all material respects, with its past practices; or
 
(f)  (i) any Group Member (other than any Subsidiary which is not a Significant
Subsidiary) shall commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts, or (B) seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or any Group Member (other than any Subsidiary
which is not a Significant Subsidiary) shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against any Group
Member any case, proceeding or other action of a nature referred to in clause
(i) above that (A) results in the entry of an order for relief or any such
adjudication or appointment or (B) remains undismissed or undischarged for a
period of 60 days; or (iii) there shall be commenced against any Group Member
any case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its assets that results in the entry of an order for any
such relief that shall not have been vacated, discharged, or stayed or bonded
pending appeal within 60 days from the entry thereof; or (iv) any Group Member
shall take any action in furtherance of, or indicating its consent to, approval
of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii)
above; or (v) any Group Member shall generally not, or shall be unable to, or
shall admit in writing its inability to, pay its debts as they become due; or
(g)  (i) any Person shall engage in any “prohibited transaction” (as defined in
Section 406 of ERISA or Section 4975 of the Code) involving any Plan, (ii) any
“accumulated funding deficiency” (as defined in Section 302 of ERISA), whether
or not waived, shall exist with respect to any Plan or any Lien in favor of the
PBGC or a Plan shall arise on the assets of any Group Member or any Commonly
Controlled Entity, (iii) a Reportable Event shall occur with respect to, or
proceedings shall commence to have a trustee appointed, or a trustee shall be
appointed, to administer or to terminate, any Single Employer Plan, which
Reportable Event or commencement of proceedings or appointment of a trustee is,
in the reasonable opinion of the Required Lenders, likely to result in the
termination of such Plan for purposes of Title IV of ERISA, (iv) any Single
Employer Plan shall terminate for purposes of Title IV of ERISA, (v) any Group
Member or any Commonly Controlled Entity shall, or in the reasonable opinion of
the Required Lenders is likely to, incur any liability in connection with a
withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan or
(vi) any other event or condition shall occur or exist with respect to a Plan;
and in each case in clauses (i) through (vi) above, such event or condition,
together with all other such events or conditions in this clause (g), if any,
could reasonably be expected to have a Material Adverse Effect; or
 
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(h)  one or more judgments or decrees shall be entered against any Group Member
involving in the aggregate a liability (not paid or fully covered by insurance
as to which the relevant insurance company has acknowledged coverage) of
$50,000,000 or more, and all such judgments or decrees shall not have been
vacated, discharged, stayed or bonded pending appeal within 30 days from the
entry thereof; or
 
(i)  any of the Security Documents shall cease, for any reason, to be in full
force and effect, or any Loan Party or any Affiliate of any Loan Party shall so
assert, or any Lien created by any of the Security Documents shall cease to be
enforceable and of the same effect and priority purported to be created thereby;
or
 
(j)  the guarantee contained in Section 2 of the Guarantee and Collateral
Agreement shall cease, for any reason, to be in full force and effect or any
Loan Party or any Affiliate of any Loan Party shall so assert; or
 
(k)  the occurrence of a Change in Control;
 
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower or any
Subsidiary Borrower, automatically the Commitments shall immediately terminate
and the Loans (with accrued interest thereon) and all other amounts owing under
this Agreement and the other Loan Documents (including all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
Credit shall have presented the documents required thereunder) shall immediately
become due and payable, and (B) if such event is any other Event of Default,
either or both of the following actions may be taken: (i) with the consent of
the Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower
declare the Revolving Commitments to be terminated forthwith, whereupon the
Revolving Commitments shall immediately terminate; and (ii) with the consent of
the Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower,
declare the Loans (with accrued interest thereon) and all other amounts owing
under this Agreement and the other Loan Documents (including all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
Credit shall have presented the documents required thereunder) to be due and
payable forthwith, whereupon the same shall immediately become due and payable.
With respect to all Letters of Credit with respect to which presentment for
honor shall not have occurred at the time of an acceleration pursuant to this
paragraph, the Borrower or the relevant Subsidiary Borrower shall at such time
deposit in a cash collateral account opened by the Administrative Agent an
amount equal to the aggregate then undrawn and unexpired amount of such Letters
of Credit. Amounts held in such cash collateral account shall be applied by the
Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
obligations of the Borrower and any Subsidiary Borrower hereunder and under the
other Loan Documents. After all such Letters of Credit shall have expired or
been fully drawn upon, all Reimbursement Obligations shall have been satisfied
and all other obligations of the Borrower and any Subsidiary Borrower hereunder
and under the other Loan Documents shall have been paid in full, the balance, if
any, in such cash collateral account shall be returned to the Borrower or such
Subsidiary Borrower (or such other Person as may be lawfully entitled thereto).
Except as expressly provided above in this Section, presentment, demand, protest
and all other notices of any kind are hereby expressly waived by the Borrower
and each Subsidiary Borrower.
 
SECTION 9.  THE AGENTS

9.1   Appointment. Each Lender hereby irrevocably designates and appoints the
Administrative Agent as the agent of such Lender under this Agreement and the
other Loan Documents,
 
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and each such Lender irrevocably authorizes the Administrative Agent, in such
capacity, to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to the Administrative Agent by the terms
of this Agreement and the other Loan Documents, together with such other powers
as are reasonably incidental thereto. Notwithstanding any provision to the
contrary elsewhere in this Agreement, the Administrative Agent shall not have
any duties or responsibilities, except those expressly set forth herein, or any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent.
 
9.2   Delegation of Duties. The Administrative Agent may execute any of its
duties under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Administrative Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys in-fact
selected by it with reasonable care.
 
9.3   Exculpatory Provisions. Neither any Agent nor any of their respective
officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
(i) liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement or any other Loan Document
(except to the extent that any of the foregoing are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from its or such Person’s own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any Loan Party or any officer thereof
contained in this Agreement or any other Loan Document or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Agents under or in connection with, this Agreement or any other Loan
Document or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document or for any failure
of any Loan Party a party thereto to perform its obligations hereunder or
thereunder. The Agents shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party.
 
9.4   Reliance by Administrative Agent. The Administrative Agent shall be
entitled to rely, and shall be fully protected in relying, upon any instrument,
writing, resolution, notice, consent, certificate, affidavit, letter, telecopy,
telex or teletype message, e-mail, statement, order or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including counsel to Holdings or the Borrower), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders (or, if so specified
by this Agreement, all Lenders) as it deems appropriate or it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and
expense that may be incurred by it by reason of taking or continuing to take any
such action. The Administrative Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement and the other Loan
Documents in accordance with a request of the Required Lenders (or, if so
specified by this Agreement, all Lenders), and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Loans.
 
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9.5   Notice of Default. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default unless
the Administrative Agent has received notice from a Lender, Holdings, the
Borrower or any Subsidiary Borrower referring to this Agreement, describing such
Default or Event of Default and stating that such notice is a “notice of
default”. In the event that the Administrative Agent receives such a notice, the
Administrative Agent shall give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Lenders (or, if
so specified by this Agreement, all Lenders); provided that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.
 
9.6   Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by any Agent hereafter
taken, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by any
Agent to any Lender. Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party that may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
 
9.7   Indemnification. The Lenders agree to indemnify each Agent in its capacity
as such (to the extent not reimbursed by Holdings, the Borrower or any
Subsidiary Borrower and without limiting the obligation of Holdings, the
Borrower or any Subsidiary Borrower to do so), ratably according to their
respective Aggregate Exposure Percentages in effect on the date on which
indemnification is sought under this Section (or, if indemnification is sought
after the date upon which the Commitments shall have terminated and the Loans
shall have been paid in full, ratably in accordance with such Aggregate Exposure
Percentages immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment of the Loans) be imposed on, incurred by or
asserted against such Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from such Agent’s gross negligence or
willful misconduct. The agreements in this Section shall survive the payment of
the Loans and all other amounts payable hereunder.
 
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9.8   Agent in Its Individual Capacity. Each Agent and its affiliates may make
loans to, accept deposits from and generally engage in any kind of business with
any Loan Party as though such Agent were not an Agent. With respect to its Loans
made or renewed by it and with respect to any Letter of Credit issued or
participated in by it, each Agent shall have the same rights and powers under
this Agreement and the other Loan Documents as any Lender and may exercise the
same as though it were not an Agent, and the terms “Lender” and “Lenders” shall
include each Agent in its individual capacity.
 
9.9   Successor Administrative Agent. The Administrative Agent may resign as
Administrative Agent upon 10 days’ notice to the Lenders and the Borrower. If
the Administrative Agent shall resign as Administrative Agent under this
Agreement and the other Loan Documents, then the Required Lenders shall appoint
from among the Lenders a successor agent for the Lenders, which successor agent
shall (unless an Event of Default under Section 8(a) or Section 8(f) with
respect to the Borrower shall have occurred and be continuing) be subject to
approval by the Borrower (which approval shall not be unreasonably withheld or
delayed), whereupon such successor agent shall succeed to the rights, powers and
duties of the Administrative Agent, and the term “Administrative Agent” shall
mean such successor agent effective upon such appointment and approval, and the
former Administrative Agent’s rights, powers and duties as Administrative Agent
shall be terminated, without any other or further act or deed on the part of
such former Administrative Agent or any of the parties to this Agreement or any
holders of the Loans. If no successor agent has accepted appointment as
Administrative Agent by the date that is 10 days following a retiring
Administrative Agent’s notice of resignation, the retiring Administrative Agent
may, on behalf of the Lenders and with the consent of the Borrower (such consent
not to be unreasonably withheld), appoint a successor Administrative Agent,
which shall be a commercial bank organized or licensed under the laws of the
United States of America or of any State thereof and having a combined capital
and surplus of at least $500,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations under this Agreement. After any retiring Administrative Agent’s
resignation as Administrative Agent, the provisions of this Section 9 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Agreement and the other Loan Documents.
 
9.10   Co-Documentation Agent, Documentation Agent and Syndication Agent.
Neither of the Co-Documentation Agent, the Documentation Agents nor the
Syndication Agent shall have any duties or responsibilities hereunder in its
capacity as such.
 
SECTION 10.  MISCELLANEOUS

10.1   Amendments and Waivers. (a)  Neither this Agreement, any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 10.1. The
Required Lenders and each Loan Party party to the relevant Loan Document may,
or, with the written consent of the Required Lenders, the Administrative Agent
and each Loan Party party to the relevant Loan Document may, from time to time,
(i) enter into written amendments, supplements or modifications hereto and to
the other Loan Documents for the purpose of adding any provisions to this
Agreement or the other Loan Documents or changing in any manner the rights of
the Lenders or of the Loan Parties hereunder or thereunder or (ii) waive, on
such terms and conditions as the Required Lenders or the Administrative Agent,
as the case may be, may specify in such instrument, any of the requirements of
this Agreement or the other Loan Documents or any Default or Event of Default
and its consequences; provided, however, that no such waiver and no such
amendment, supplement or modification shall (A) forgive any principal amount or
extend the final scheduled date of maturity of any Loan or any Reimbursement
Obligation or extend the scheduled date of any amortization payment in respect
of any Term Loan (for the purpose of clarity each of the foregoing
 
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not to include any waiver of a prepayment), reduce the stated rate of any
interest or fee payable hereunder (except (1) in connection with the waiver of
applicability of any post-default increase in interest rates (which waiver shall
be effective with the consent of the Majority Facility Lenders of each adversely
affected Facility) and (2) that any amendment or modification of defined terms
used in the financial covenants in this Agreement shall not constitute a
reduction in the rate of interest or fees for purposes of this clause (A)) or
extend the scheduled date of any payment thereof, or increase the amount or
extend the expiration date of any Lender’s Revolving Commitment, in each case
without the written consent of each Lender directly affected thereby; (B)
eliminate or reduce the voting rights of any Lender under this Section 10.1
without the written consent of such Lender; (C) reduce any percentage specified
in the definition of Required Lenders, consent to the assignment or transfer by
the Borrower or any Subsidiary Borrower of any of its rights and obligations
under this Agreement and the other Loan Documents, release all or substantially
all of the Collateral or release all or substantially all of the Subsidiary
Guarantors from their obligations under the Guarantee and Collateral Agreement
except as otherwise provided in the Loan Documents, in each case without the
written consent of all Lenders; (D) amend, modify or waive any provision of
Section 2.11 or 2.17 without the written consent of the Majority Facility
Lenders in respect of each Facility adversely affected thereby; (E) reduce the
percentage specified in the definition of Majority Facility Lenders with respect
to any Facility without the written consent of all Lenders under such Facility;
(F) after the Closing Date, amend, modify or waive any provision of Section 5.2
without the written consent of the Majority Facility Lenders with respect of the
Revolving Facility, (G) amend, modify or waive any provision of Section 9
without the written consent of the Administrative Agent; (H) amend, modify or
waive any provision of Section 2.6 or 2.7 without the written consent of the
Swingline Lender; or (I) amend, modify or waive any provision of Section 3
without the written consent of the Issuing Lender. Any such waiver and any such
amendment, supplement or modification shall apply equally to each of the Lenders
and shall be binding upon the Loan Parties, the Lenders, the Administrative
Agent and all future holders of the Loans. In the case of any waiver, the Loan
Parties, the Lenders and the Administrative Agent shall be restored to their
former position and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon.
 
(b)   Notwithstanding the foregoing, this Agreement may be amended with the
written consent of the Administrative Agent, the Borrower and each of the
Lenders providing the relevant Replacement Term Loans (as defined below) to
permit the refinancing, replacement or modification of all outstanding Term
Loans (“Replaced Term Loans”) with a replacement term loan tranche hereunder
(“Replacement Term Loans”), provided that (i) the aggregate principal amount of
such Replacement Term Loans shall not exceed the aggregate principal amount of
such Replaced Term Loans, (ii) the Applicable Margin for such Replacement Term
Loans shall not be higher than the Applicable Margin for such Replaced Term
Loans and (iii) the weighted average life to maturity of such Replacement Term
Loans shall not be shorter than the weighted average life to maturity of such
Replaced Term Loans at the time of such refinancing.
 
(c)   In addition, notwithstanding the foregoing, this Agreement may be amended
without consent of the Lenders, so long as no Default or Event of Default shall
have occurred and be continuing, as follows:
 
(i) to designate (x) any Domestic Subsidiary of the Borrower as a Domestic
Subsidiary Borrower under the Revolving Facility and (y) any Foreign Subsidiary
of the Borrower as a Foreign Subsidiary Borrower under a New Local Facility upon
(A) ten Business Days prior notice to the Lenders (such notice to contain the
name, primary business address and taxpayer identification number of such
Subsidiary), (B) the execution and delivery by the Borrower, such
 
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Subsidiary and the Administrative Agent of a Joinder Agreement, substantially in
the form of Exhibit G (a “Joinder Agreement”), providing for such Subsidiary to
become a Subsidiary Borrower, (C) the agreement and acknowledgment by the
Borrower and each other Subsidiary Borrower that the Guarantee and Collateral
Agreement covers the Obligations of such Subsidiary and (D) the delivery to the
Administrative Agent of (1) corporate or other applicable resolutions, other
corporate or other applicable documents, certificates and legal opinions in
respect of such Subsidiary reasonably equivalent to comparable documents
delivered on the Closing Date and (2) such other documents with respect thereto
as the Administrative Agent shall reasonably request; and

(ii) to remove any Subsidiary as a Subsidiary Borrower upon execution and
delivery by the Borrower to the Administrative Agent of a written notification
to such effect and repayment in full of all Loans made to such Subsidiary
Borrower, cash collateralization of all L/C Obligations in respect of any
Letters of Credit issued for the account of such Subsidiary Borrower and
repayment in full of all other amounts owing by such Subsidiary Borrower under
this Agreement and the other Loan Documents (it being agreed that any such
repayment shall be in accordance with the other terms of this Agreement).

10.2   Notices. All notices, requests and demands to or upon the respective
parties hereto to be effective shall be in writing (including by telecopy or
electronic transmission), and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made when delivered, or three Business Days
after being deposited in the mail, postage prepaid, or, in the case of telecopy
notice or electronic transmission, when received, addressed as follows in the
case of Holdings, the Borrower and the Administrative Agent, and as set forth in
an administrative questionnaire delivered to the Administrative Agent in the
case of the Lenders, or to such other address as may be hereafter notified by
the respective parties hereto:
 
Holdings:
Avis Budget Holdings, LLC
 
1 Campus Drive
Parsippany, New Jersey 07054
Attention: David B. Wyshner
 
Telecopy: (973) 496-5080
 
Telephone: (973) 496-7938
   
Borrower:
Avis Budget Car Rental, LLC
 
1 Campus Drive
Parsippany, New Jersey 07054
Attention: David B. Wyshner
 
Telecopy: (973) 496-5080
 
Telephone: (973) 496-7938
   
Administrative Agent:
JPMorgan Chase Bank, N.A.
1111 Fannin Street
10th Floor
Houston, Texas 77002
 
Attention: Jen Yi Lin
 
Telecopy: (713) 750-2932
 
Telephone: (713) 750-2931
   
with a copy to:
JPMorgan Chase Bank, N.A.
270 Park Avenue
4th Floor
New York, New York 10017
 
Attention: Randolph E. Cates
 
Telecopy: (212) 270-6041
 
Telephone: (212) 270-8997

 
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provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders shall not be effective until received.
 
Notices and other communications to the Lenders hereunder may be delivered or
furnished by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices
pursuant to Section 2 unless otherwise agreed by the Administrative Agent and
the applicable Lender. The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.
 
10.3   No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
remedy, power or privilege hereunder or under the other Loan Documents shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.
 
10.4   Survival of Representations and Warranties. All representations and
warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans and other extensions of credit hereunder.
 
10.5   Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
reimburse the Administrative Agent for all its reasonable out-of-pocket costs
and expenses incurred in connection with the development, preparation and
execution of, and any amendment, supplement or modification to, this Agreement
and the other Loan Documents and any other documents prepared in connection
herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including the reasonable fees and
disbursements of Simpson Thacher & Bartlett LLP and filing and recording fees
and expenses, with statements with respect to the foregoing to be submitted to
the Borrower prior to the Closing Date (in the case of amounts to be paid on the
Closing Date) and from time to time thereafter on a quarterly basis or such
other periodic basis as the Administrative Agent shall deem appropriate, (b) to
pay or reimburse each Lender and the Administrative Agent for all its reasonable
out-of-pocket costs and expenses incurred in connection with the enforcement or
preservation of any rights under this Agreement, the other Loan Documents and
any such other documents, including the fees and disbursements of counsel to the
Lenders and of counsel to the Administrative Agent; provided, that the Borrower
shall not be liable for the fees and disbursements of more than one separate
firm for the Lenders (unless there shall exist an actual conflict of interest
among the Lenders) in connection with any one action or any separate but
substantially similar or related actions in the same jurisdiction, nor shall the
Borrower be liable for any settlement or extra-judicial resolution of claims
without the Borrower’s written consent, (c) to pay, indemnify, and hold each
Lender and the Administrative Agent 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, excise and similar taxes, if any, that may be payable or
determined to be payable in connection with the execution and delivery of, or
consummation or administration of any of the
 
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transactions contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, this Agreement, the other Loan
Documents and any such other documents, and (d) to pay, indemnify, and hold each
Lender and the Administrative Agent and their respective officers, directors,
employees, affiliates, agents and controlling persons (each, an “Indemnitee”)
harmless from and against any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever (other than with respect to taxes, which shall
be governed exclusively by Section 2.19) with respect to the execution,
delivery, enforcement, performance and administration of this Agreement, the
other Loan Documents and any such other documents, including any of the
foregoing relating to the use of proceeds of the Loans or the violation of,
noncompliance with or liability under, any Environmental Law applicable to the
operations of any Group Member or any of the Properties and the reasonable fees
and expenses of legal counsel in connection with claims, actions or proceedings
by any Indemnitee against any Loan Party under any Loan Document (all the
foregoing in this clause (d), collectively, the “Indemnified Liabilities”),
provided, that the Borrower shall have no obligation hereunder to any Indemnitee
with respect to Indemnified Liabilities to the extent such Indemnified
Liabilities are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from the gross negligence or willful
misconduct of such Indemnitee; provided further, that that the Borrower shall
not be liable for the fees and disbursements of more than one separate firm for
any Indemnitees (unless there shall exist an actual conflict of interest among
such Indemnitees) in connection with any one action or any separate but
substantially similar or related actions in the same jurisdiction, nor shall the
Borrower be liable for any settlement or extra-judicial resolution of such
Indemnitees’ claims without the Borrower’s written consent. Without limiting the
foregoing, and to the extent permitted by applicable law, the Borrower agrees
not to assert and to cause its Subsidiaries not to assert, and hereby waives and
agrees to cause its Subsidiaries to waive, all rights for contribution or any
other rights of recovery with respect to all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or
nature, under or related to Environmental Laws, that any of them might have by
statute or otherwise against any Indemnitee. All amounts due under this Section
10.5 shall be payable not later than 10 days after written demand therefor.
Statements payable by the Borrower pursuant to this Section 10.5 shall be
submitted to David B. Wyshner (Telephone No.  973-496-7938) (Telecopy
No. 973-496-5080), at the address of the Borrower set forth in Section 10.2, or
to such other Person or address as may be hereafter designated by the Borrower
in a written notice to the Administrative Agent. The agreements in this Section
10.5 shall survive repayment of the Loans and all other amounts payable
hereunder.
 
10.6   Successors and Assigns; Participations and Assignments. (a) The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted hereby
(including any affiliate of the Issuing Lender that issues any Letter of
Credit), except that (i) the Borrower may not assign or otherwise transfer any
of its rights or obligations hereunder without the prior written consent of each
Lender (and any attempted assignment or transfer by the Borrower without such
consent shall be null and void) and (ii) no Lender may assign or otherwise
transfer its rights or obligations hereunder except in accordance with this
Section.

(b)(i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more assignees (each, an “Assignee”) all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitments and the Loans at the time owing to it) with the prior
written consent of:

(A) the Borrower (such consent not to be unreasonably withheld), provided that
no consent of the Borrower shall be required for an assignment to a Lender, an
affiliate of a Lender, an Approved Fund (as defined below) or, if an Event of
Default under Section 8(a) or (f) has occurred and is continuing, any other
Person; and

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(B) the Administrative Agent, provided that no consent of the Administrative
Agent shall be required for an assignment of all or any portion of a Term Loan
to a Lender, an affiliate of a Lender or an Approved Fund.

(C) the Issuing Lender, provided that no consent of the Issuing Lender shall be
required for an assignment of all or any portion of a Term Loan or Term
Commitment.

(ii) Assignments shall be subject to the following additional conditions:
 
(A) except in the case of an assignment to a Lender, an affiliate of a Lender or
an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Commitments or Loans under any Facility, the amount of the
Commitments or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not be less than, in
the case of the Revolving Facility, $5,000,000 or, in the case of the Term
Facility, $1,000,000 unless each of the Borrower and the Administrative Agent
otherwise consent, provided that (1) no such consent of the Borrower shall be
required if an Event of Default under Section 8(a) or (f) has occurred and is
continuing and (2) such amounts shall be aggregated in respect of each Lender
and its affiliates or Approved Funds, if any;

(B) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500; and

(C) the Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an administrative questionnaire.

For the purposes of this Section 10.6, “Approved Fund” means any Person (other
than a natural person) that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the ordinary course
of its business and that is administered or managed by (a) a Lender, (b) an
affiliate of a Lender or (c) an entity or an affiliate of an entity that
administers or manages a Lender.
 
(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
below, from and after the effective date specified in each Assignment and
Assumption the Assignee thereunder shall be a party hereto and, to the extent of
the interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 2.18,
2.19, 2.20 and 10.5). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 10.6
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section.

(iv) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amount of and
interest on the Loans and L/C Obligations owing to, each Lender pursuant to the
terms hereof from time to time (the “Register”). The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent, the Issuing
Lender and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
 
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this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, the Issuing Lender and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.

(v) Upon its receipt of a duly completed Assignment and Assumption executed by
an assigning Lender and an Assignee, the Assignee’s completed administrative
questionnaire (unless the Assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall accept such Assignment and Assumption
and record the information contained therein in the Register. No assignment
shall be effective for purposes of this Agreement unless it has been recorded in
the Register as provided in this paragraph.

(c)(i) Any Lender may, without the consent of the Borrower or the Administrative
Agent, sell participations to one or more banks or other entities (a
“Participant”) in all or a portion of such Lender’s rights and obligations under
this Agreement (including all or a portion of its Commitments and the Loans
owing to it); provided that (A) such Lender’s obligations under this Agreement
shall remain unchanged, (B) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (C) the
Borrower, the Administrative Agent, the Issuing Lender and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender’s rights and obligations under this Agreement. Any agreement
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement may provide that such Lender will not, without the consent
of the Participant, agree to any amendment, modification or waiver that (1)
requires the consent of each Lender directly affected thereby pursuant to the
proviso to the second sentence of Section 10.1 and (2) directly affects such
Participant. Subject to paragraph (c)(ii) of this Section, the Borrower agrees
that each Participant shall be entitled to the benefits of Sections 2.18, 2.19
and 2.20 to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to paragraph (b) of this Section. To the extent permitted
by law, and subject to paragraph (c)(ii) of this Section, each Participant also
shall be entitled to the benefits of Section 10.7(b) as though it were a Lender,
provided such Participant shall be subject to Section 10.7(a) as though it were
a Lender.

(ii) A Participant shall not be entitled to receive any greater payment under
Section 2.18 or 2.19 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant. A
Participant shall not be entitled to receive any funds directly from the
Borrower in respect of Sections 2.18, 2.19, 2.20 or 10.7 unless such Participant
shall have provided to Administrative Agent, acting for this purpose as an agent
of the Borrower, such information as is required to be recorded in the Register
pursuant to paragraph (b)(iv) above as if such Participant were a Lender. Any
Participant that is a Non-U.S. Lender shall not be entitled to the benefits of
Section 2.19 unless such Participant complies with Section 2.19(d) as though it
were a Lender.

(d)  Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including any pledge or assignment to secure obligations to a Federal
Reserve Bank, and this Section shall not apply to any such pledge or assignment
of a security interest; provided that no such pledge or assignment of a security
interest shall release a Lender from any of its obligations hereunder or
substitute any such pledgee or Assignee for such Lender as a party hereto.

(e) The Borrower, upon receipt of written notice from the relevant Lender,
agrees to issue Notes to any Lender requiring Notes to facilitate transactions
of the type described in paragraph (d) above.
 
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(f) Notwithstanding the foregoing, any Conduit Lender may assign any or all of
the Loans it may have funded hereunder to its designating Lender without the
consent of the Borrower or the Administrative Agent and without regard to the
limitations set forth in Section 10.6(b). Each of Holdings, the Borrower, each
Subsidiary Borrower, each Lender and the Administrative Agent hereby confirms
that it will not institute against a Conduit Lender or join any other Person in
instituting against a Conduit Lender any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceeding under any state bankruptcy or
similar law, for one year and one day after the payment in full of the latest
maturing commercial paper note issued by such Conduit Lender; provided, however,
that each Lender designating any Conduit Lender hereby agrees to indemnify, save
and hold harmless each other party hereto for any loss, cost, damage or expense
arising out of its inability to institute such a proceeding against such Conduit
Lender during such period of forbearance.
 
10.7   Adjustments; Set-off. (a) Except to the extent that this Agreement
expressly provides for payments to be allocated to a particular Lender or to the
Lenders under a particular Facility, if any Lender (a “Benefitted Lender”)
shall, at any time after the Loans and other amounts payable hereunder shall
immediately become due and payable pursuant to Section 8, receive any payment of
all or part of the Obligations owing to it, or receive any collateral in respect
thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Section 8(f), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender, if any, in respect of the Obligations owing to such other Lender, such
Benefitted Lender shall purchase for cash from the other Lenders a participating
interest in such portion of the Obligations owing to each such other Lender, or
shall provide such other Lenders with the benefits of any such collateral, as
shall be necessary to cause such Benefitted Lender to share the excess payment
or benefits of such collateral ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.
 
(b)   In addition to any rights and remedies of the Lenders provided by law,
each Lender shall have the right, without prior notice to Holdings, the Borrower
or any Subsidiary Borrower, any such notice being expressly waived by Holdings,
the Borrower and each Subsidiary Borrower to the extent permitted by applicable
law, upon any amount becoming due and payable by Holdings, the Borrower or any
Subsidiary Borrower hereunder (whether at the stated maturity, by acceleration
or otherwise), to set off and appropriate and apply against such amount any and
all deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender or any branch or agency
thereof to or for the credit or the account of Holdings, the Borrower or such
Subsidiary Borrower, as the case may be. Each Lender agrees promptly to notify
the Borrower and the Administrative Agent after any such setoff and application
made by such Lender, provided that the failure to give such notice shall not
affect the validity of such setoff and application.
 
10.8   Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page of this Agreement by
facsimile or other electronic transmission shall be effective as delivery of a
manually executed counterpart hereof. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
 
10.9   Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such
 
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prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
 
10.10   Integration. This Agreement and the other Loan Documents represent the
entire agreement of Holdings, the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to the subject matter hereof not expressly set
forth or referred to herein or in the other Loan Documents.
 
10.11   GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
 
10.12   Submission To Jurisdiction; Waivers. Each of the Agents, Lenders,
Holdings, the Borrower and the Subsidiary Borrowers hereby irrevocably and
unconditionally:
 
(a)  submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States for the Southern District of New York, and appellate
courts from any thereof;
 
(b)  consents that any such action or proceeding may be brought in such courts
and waives any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
 
(c)  agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to Holdings, the Borrower
or the relevant Subsidiary Borrower, as the case may be, at its address set
forth in Section 10.2 or at such other address of which the Administrative Agent
shall have been notified pursuant thereto;
 
(d)  agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and
 
(e)  waives, to the maximum extent not prohibited by law, any right it may have
to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.
 
10.13   Judgment. The obligations of the Borrower or any Subsidiary Borrower in
respect of this Agreement and the other Loan Documents due to any party hereto
shall, notwithstanding any judgment in a currency (the “judgment currency”)
other than the currency in which the sum originally due to such party is
denominated (the “original currency”), be discharged only to the extent that on
the Business Day following receipt by such party of any sum adjudged to be so
due in the judgment currency such party may in accordance with normal banking
procedures purchase the original currency with the judgment currency; if the
amount of the original currency so purchased is less than the sum originally due
under such judgment to such party in the original currency, the Borrower or such
Subsidiary Borrower, as the case may be, agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify such party against such loss,
and if the amount of the original currency so purchased exceeds the sum
 
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originally due to any party to this Agreement, such party agrees to remit to the
Borrower such excess. The provisions of this Section 10.13 shall survive the
termination of this Agreement and payment of the obligations of the Borrower and
the Subsidiary Borrowers under this Agreement and the other Loan Documents.
 
10.14   Acknowledgements. Each of Holdings, the Borrower and the Subsidiary
Borrowers hereby acknowledges that:
 
(a)  it has been advised by counsel in the negotiation, execution and delivery
of this Agreement and the other Loan Documents;
 
(b)  neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to Holdings, the Borrower or any Subsidiary Borrower
arising out of or in connection with this Agreement or any of the other Loan
Documents, and the relationship between Administrative Agent and Lenders, on one
hand, and Holdings, the Borrower or any Subsidiary Borrower, on the other hand,
in connection herewith or therewith is solely that of debtor and creditor; and
 
(c)   no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among Holdings, the Borrower or any Subsidiary Borrower and the
Lenders.
 
10.15   Releases of Guarantees and Liens. (a) Notwithstanding anything to the
contrary contained herein or in any other Loan Document, the Administrative
Agent is hereby irrevocably authorized by each Lender (without requirement of
notice to or consent of any Lender except as expressly required by Section 10.1)
to take any action requested by the Borrower having the effect of releasing any
Collateral or guarantee obligations (i) to the extent necessary to permit
consummation of any transaction not prohibited by any Loan Document or that has
been consented to in accordance with Section 10.1 or (ii) under the
circumstances described in paragraph (b) below.
 
(b)   At such time as the Loans, the Reimbursement Obligations and the other
obligations under the Loan Documents (other than obligations under or in respect
of Specified Swap Agreements) shall have been paid in full, the Commitments have
been terminated and no Letters of Credit shall be outstanding (or such Letters
of Credit are Collateralized), the Collateral shall be released from the Liens
created by the Security Documents, and the Security Documents and all
obligations (other than those expressly stated to survive such termination) of
the Administrative Agent and each Loan Party under the Security Documents shall
terminate, all without delivery of any instrument or performance of any act by
any Person.
 
10.16   Confidentiality. Each of the Administrative Agent and each Lender agrees
to keep confidential all non-public information provided to it by any Loan
Party, the Administrative Agent or any Lender pursuant to or in connection with
this Agreement that is designated by the provider thereof as confidential;
provided that nothing herein shall prevent the Administrative Agent or any
Lender from disclosing any such information (a) to the Administrative Agent, any
other Lender or any affiliate thereof, (b) subject to an agreement to comply
with the provisions of this Section, to any actual or prospective Transferee or
any direct or indirect counterparty to any Swap Agreement (or any professional
advisor to such counterparty), (c) to its employees, directors, agents,
attorneys, accountants and other professional advisors or those of any of its
affiliates for performing the purposes of a Loan Document, (d) upon the request
or demand of any Governmental Authority, (e) in response to any order of any
court or other Governmental Authority or as may otherwise be required pursuant
to any Requirement of Law, after notice to the Borrower if reasonably feasible,
(f) if requested or required to do so in connection with any
 
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litigation or similar proceeding, after notice to the Borrower if reasonably
feasible, (g) that has been publicly disclosed, (h) to the National Association
of Insurance Commissioners or any similar organization or any nationally
recognized rating agency that requires access to information about a Lender’s
investment portfolio in connection with ratings issued with respect to such
Lender, or (i) in connection with the exercise of any remedy hereunder or under
any other Loan Document.

10.17   WAIVERS OF JURY TRIAL. HOLDINGS, THE BORROWER, THE ADMINISTRATIVE AGENT
AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
 
10.18   USA Patriot Act. Each Lender hereby notifies Holdings and the Borrower
that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the “USA Patriot Act”), it is
required to obtain, verify and record information that identifies Holdings and
the Borrower, which information includes the name and address of Holdings and
the Borrower and other information that will allow such Lender to identify
Holdings and the Borrower in accordance with the USA Patriot Act
 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.
 
 

     
AVIS BUDGET HOLDINGS, LLC
 
     
By: 
/s/ David B. Wyshner
     
Name:
Title:
David B. Wyshner
Executive Vice President, Chief Financial Officer and Treasurer
 

 

     
AVIS BUDGET CAR RENTAL, LLC
 
     
By: 
/s/ David B. Wyshner
     
Name:
Title:
David B. Wyshner
Executive Vice President, Chief Financial Officer and Treasurer
 

 

     
JPMORGAN CHASE BANK, N.A., as
Administrative Agent and as a Lender
 
     
By: 
/s/ Randolph Cates
     
Name:
Title:
Randolph Cates
Vice President
 

 

     
DEUTSCHE BANK SECURITIES INC.,
as Syndication Agent
 
     
By: 
/s/ Kevin Sherlock
     
Name:
Title:
Kevin Sherlock
Managing Director
 

     
DEUTSCHE BANK AG NEW YORK BRANCH,
as a Lender
 
     
By:
/s/ Lana Gifas
     
Name:
Title:
Lana Gifas
Vice President
 

   
By:
/s/ Evelyn Thierry
     
Name:
Title:
(i)   Evelyn Thierry
Vice President
 

 

--------------------------------------------------------------------------------

 

     
DEUTSCHE BANK AG NEW YORK BRANCH, as a Lender
 
     
By:
/s/ Lana Gifas
     
Name:
Title:
Lana Gifas
Vice President
 

 

     
BANK OF AMERICA, N.A., as a Documentation Agent as a Lender
 
     
By:
/s/ Chris McDonell
     
Name:
Title:
Chris McDonell
Senior Vice President
 

 

     
CALYON NEW YORK BRANCH, as a Documentation Agent as a Lender
 
     
By:
/s/ Rod Hurst
     
Name:
Title:
Rod Hurst
Managing Director
 

 

   
By:
/s/ Yuri Muzichenko
     
Name:
Title:
Yuri Muzichenko
Director
 

  

 

     
CITICORP USA, INC., as a Co-Documentation Agent and as a Lender
 
     
By:
/s/ Hugo Arias
     
Name:
Title:
Hugo Arias
Director
 

 

     
WACHOVIA BANK, NATIONAL ASSOCIATION, as Documentation Agent and as a Lender
 
     
By:
/s/ Karin E. Samuel
     
Name:
Title:
Karin E. Samuel
Vice President
 

 

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Signature Page to
Avis Budget Car Rental, LLC
Credit Agreement, dated as of April 19, 2006
 

 

     
SUMITOMO MITSUI BANKING CORPORATION
 
     
By:
/s/ Shigeru Tsuru
     
Name:
Title:
Shigeru Tsuru
Joint General Manager
 

 
 

     
THE BANK OF TOKYO-MITSUBISHI UFJ, Ltd., New York Branch
 
     
By:
/s/ Linda Tam
     
Title:
Authorized Signatory
 

 
 

     
THE BANK OF NOVA SCOTIA
 
     
By:
/s/ Todd S. Meller
     
Name:
Title:
Todd S. Meller
Managing Director
 

 
 

     
BARCLAYS BANK PLC
     
By:
/s/ Nicholas Bell
     
Name:
Title:
Nicolas Bell
Director
 

 
 

     
GOLDMAN SACHS CREDIT PARTNERS L.P.
 
     
By:
/s/ William Archer
     
Name:
Title:
William Archer
Managing Director
 

 
 

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THE ROYAL BANK OF SCOTLAND
 
     
By:
/s/ Frank Guerra
     
Name:
Title:
Frank Guerra
Managing Director
 

     
HARRIS NESBITT FINANCING, INC.
 
     
By:
/s/ Stephen Maenhout
     
Name:
Title:
Stephen Maenhout
Vice President
 

     
CREDIT SUISSE, CAYMAN ISLANDS BRANCH
 
     
By:
/s/ Mark E. Gleason
     
Name:
Title:
Mark E. Gleason
Director
 

 

   
By:
/s/ Mikhail Faybusovich
     
Name:
Title:
Mikhail Faybusovich
Associate
 

 

     
MERRILL LYNCH CAPITAL CORPORATION
 
     
By:
/s/ Stephanie Vallillo
     
Name:
Title:
Stephanie Vallillo
Vice President
 

  

     
MIZUHO CORPORATE BANK, LTD.
 
     
By:
/s/ Robert Gallagher
     
Name:
Title:
Robert Gallagher
SVP & Team Leader
 

 

--------------------------------------------------------------------------------

 

     
BAYERISCHE HYPO-UND VEREINSBANK AG, New York Branch
 
     
By:
/s/ Ken Hamilton
     
Name:
Title:
Ken Hamilton
Director
 

 

   
By:
/s/ Kimberly Sousa
     
Name:
Title:
Kimberly Sousa
Director
 

 

     
THE BANK OF NEW YORK
 
     
By:
/s/ Roger Grossman
     
Name:
Title:
Roger Grossman
Vice President
 

 

     
WELLS FARGO BANK, N.A.
 
     
By:
/s/ Steven J. Anderson
     
Name:
Title:
Steven J. Anderson
Senior Vice President
 

 

     
FIRST COMMERCIAL BANK, NEW YORK AGENCY
 
     
By:
/s/ Bruce M.J. Ju
     
Name:
Title:
Bruce M. J. Ju
VP & General Manager
 

 
 

     
WESTPAC BANKING CORPORATION
 
     
By:
/s/ Michael Hawkins
     
Name:
Title:
Michael Hawkins
Vice President, Tier 2 Attorney
 

 
 

--------------------------------------------------------------------------------

 

     
CHANG HWA COMMERCIAL BANK, LTD. NEW YORK BRANCH
 
     
By:
/s/ Jim C.Y. Chen
     
Name:
Title:
Jim C.Y. Chen
VP & General Manager
 

 
 

     
GENERAL ELECTRIC CAPITAL CORPORATION
 
     
By:
/s/ Robert M. Kadlick
     
Name:
Title:
Robert M. Kadlick
Duly Authorized Signatory
 

 

     
CREDIT INDUSTRIEL ET COMMERCIAL
 
     
By:
/s/ Eric Longuet
     
Name:
Title:
Eric Longuet
Vice President
 

 
 

   
By:
Eric Dulot
     
Name:
Title:
Eric Dulot
Vice President
 

  
 

     
NATEXIS BANQUES POPULAIRES
 
     
By:
/s/ Frank H. Madden
     
Name:
Title:
Frank H. Madden
Vice President & Group Manager
 

 
 

--------------------------------------------------------------------------------

 

   
By:
/s/ Jordan H. Levy
     
Name:
Title:
Jordan H. Levy
Assistant Vice President
 

  
 

     
NATIONAL CITY BANK
 
     
By:
/s/ Renee M. Bonnell
     
Name:
Title:
Renee M. Bonnell
Assistant Vice President
 

 

     
PNC BANK, NATIONAL ASSOCIATION
 
     
By:
/s/ John F. Broeren
     
Name:
Title:
John F. Broeren
Vice President