Exhibit 4.9.21


 


NOTE
GUARANTY INSURANCE POLICY


 


Policy No: 47437


 


OBLIGATIONS:              Hertz
Vehicle Financing LLC


 


$500,000,000 Series 2005-1
Floating Rate Rental Car Asset Backed Notes, Class A-1


$275,000,000 Series 2005-1
Floating Rate Rental Car Asset Backed Notes, Class A-2


$100,000,000 Series 2005-1
Rental Car Asset Backed Notes, Class A-3


$1,150,000,000 Series 2005-1
Floating Rate Rental Car Asset Backed Notes, Class A-4


$125,000,000 Series 2005-1
Rental Car Asset Backed Notes, Class A-5


 


MBIA Insurance Corporation (the “Insurer”),
in consideration of the payment of the premium and subject to the terms of this
Note Guaranty Insurance Policy (this “Policy”),
hereby unconditionally and irrevocably guarantees to each Series 2005-1 Class A
Noteholder that an amount equal to each full and complete Insured Payment will
be received by BNY Midwest Trust Company, or its successor, as trustee for the Series 2005-1
Class A Noteholders (the “Trustee”),
on behalf of the Series 2005-1 Class A Noteholders from the Insurer,
for distribution by the Trustee to such Series 2005-1 Class A
Noteholder of such Series 2005-1 Class A Noteholder’s share of the
Insured Payment. The Insurer’s obligations hereunder with respect to a
particular Insured Payment shall be discharged to the extent funds equal to the
applicable Insured Payment are received by the Trustee, whether or not such
funds are properly applied by the Trustee. Insured Payments shall be made only
at the time set forth in this Policy, and no accelerated Insured Payments shall
be made regardless of any acceleration of the Obligations, unless such
acceleration is at the sole option of the Insurer. The Insured Payments do not
include and this Policy does not insure any distributions of any Class A-1
Controlled Distribution Amounts, any Class A-2 Controlled Distribution
Amounts, any Class A-3 Controlled Distribution Amounts, any Class A-4
Controlled Distribution Amounts or any Class A-5 Controlled Distribution
Amounts.


 


Notwithstanding the foregoing paragraph, this Policy does not cover
shortfalls, if any, attributable to the liability of the Issuer or the Trustee
for withholding taxes, if any (including interest and penalties in respect of
any such liability).


 


The Insurer will pay any Insured Payment that is a Preference Amount on
the Business Day following receipt on a Business Day by the Fiscal Agent (as
described below) of (i) a certified copy of the order requiring the return
of such Preference Amount, (ii) an opinion of counsel satisfactory to the
Insurer that such order is final and not subject to appeal, (iii) an
assignment in such form as is reasonably required by the Insurer,
irrevocably assigning to the Insurer all rights and claims of the applicable Series 2005-1
Class A Noteholder relating to or arising under the Obligations against
the debtor which made such preference payment or otherwise with respect to such
preference payment and (iv) appropriate instruments to effect the
appointment of the Insurer as agent for such Series 2005-1 Class A
Noteholder in any legal proceeding related to such preference payment, such
instruments being in a form satisfactory to the Insurer, provided that if
such documents are received after 12:00 noon, New York City time, on such
Business Day, they will be deemed to be received on the following Business Day.
Such payments shall be disbursed to the receiver or trustee in bankruptcy named
in the final order of


 

















 


the court exercising jurisdiction on behalf
of the applicable Series 2005-1 Class A Noteholder and not to such Series 2005-1
Class A Noteholder directly unless such Series 2005-1 Class A
Noteholder has returned principal or interest paid on the Obligations to such
receiver or trustee in bankruptcy, in which case such payment shall be
disbursed to such Series 2005-1 Class A Noteholder.


 


The Insurer will pay any other amount payable hereunder no later than
12:00 noon, New York City time, on the later of the Payment Date on which the
related Deficit Amount is due or the second Business Day following receipt in
New York, New York on a Business Day by U.S. Bank Trust National Association,
as Fiscal Agent for the Insurer or any successor fiscal agent appointed by the
Insurer (the “Fiscal Agent”) of a Notice
(as described below); provided that if such Notice is received after 12:00
noon, New York City time, on such Business Day, it will be deemed to be
received on the following Business Day. If any such Notice received by the
Fiscal Agent is not in proper form or is otherwise insufficient for the
purpose of making a claim hereunder, it shall be deemed not to have been
received by the Fiscal Agent for purposes of this paragraph, and the Insurer or
the Fiscal Agent, as the case may be, shall promptly so advise the Trustee
and the Trustee may submit an amended Notice.


 


Insured Payments due hereunder, unless otherwise stated herein, will be
disbursed by the Fiscal Agent to the Trustee on behalf of the Series 2005-1
Class A Noteholders by wire transfer of immediately available funds in the
amount of the Insured Payment less, in respect of Insured Payments related to
Preference Amounts, any amount held by the Trustee for the payment of such
Insured Payment and legally available therefor.


 


The Fiscal Agent is the agent of the Insurer only, and the Fiscal Agent
shall in no event be liable to Series 2005-1 Class A Noteholders for
any acts of the Fiscal Agent or any failure of the Insurer to deposit, or cause
to be deposited, sufficient funds to make payments due under this Policy.


 


Subject to the terms of the Agreement, the Insurer shall be subrogated
to the rights of each Series 2005-1 Class A Noteholder to receive
payments under the Obligations to the extent of any payment by the Insurer
under this Policy.


 


As used herein, the following terms shall have the following meanings:


 


“Agreement” means the Amended
and Restated Base Indenture dated as of December 21, 2005 between Hertz
Vehicle Financing LLC and the Trustee, as amended and supplemented by the Series 2005-1
Supplement thereto dated as of December 21, 2005, as in effect on the Series 2005-1
Closing Date and as amended, modified or supplemented from time to time in
accordance with its terms.


 


“Business Day” means any day
other than (a) a Saturday or a Sunday or (b) a day on which the
Insurer or banking institutions in New York City or in the city in which the
corporate trust office of the Trustee under the Agreement is located are
authorized or obligated by law or executive order to close.


 


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“Deficit Amount” means (a) with
respect to any Payment Date, the sum of (i) the excess, if any, of (A) the
Series 2005-1 Adjusted Monthly Interest over (B) the sum of amounts
in the Series 2005-1 Accrued Interest Account and the Class A
Liquidity Amount as of such Payment Date and (ii) the Insured Principal
Deficit Amount in respect of such Payment Date and (b) with respect to the
Three-Year Notes Legal Final Payment Date, the Four-Year Notes Legal Final
Payment Date or the Five-Year Notes Legal Final Payment Date, as applicable,
the Class A-1 Outstanding Principal Amount, the Class A-2 Outstanding
Principal Amount, the Class A-3 Outstanding Principal Amount, the Class A-4
Outstanding Principal Amount or the Class A-5 Outstanding Principal
Amount, as applicable, to the extent unpaid on the Three-Year Notes Legal Final
Payment Date, the Four-Year Notes Legal Final Payment Date or the Five-Year
Notes Legal Final Payment Date, as applicable, after application of all funds
available for reduction of principal of the Series 2005-1 Class A
Notes, on such Payment Date pursuant to the Agreement.


 


“Insured Payment” means (i) any
Deficit Amount and (ii) any Preference Amount.


 


“Notice” means the telephonic
or telegraphic notice, promptly confirmed in writing by telecopy substantially
in the form of Exhibit A attached hereto, the original of which is
subsequently delivered by registered or certified mail, from the Trustee
specifying the Insured Payment which shall be due and owing on the applicable
Payment Date.


 


“Preference Amount” means any
amount previously distributed to a Series 2005-1 Class A Noteholder
on the Obligations that is recoverable and sought to be recovered as a voidable
preference by a trustee in bankruptcy pursuant to the United States Bankruptcy
Code (11 U.S.C.), as amended from time to time, in accordance with a final
nonappealable order of a court having competent jurisdiction.


 


“Series 2005-1 Adjusted Monthly Interest”
means (a) for the initial Payment Date, (i) $9,671,222.22 and (b) for
any other Payment Date, the sum of (i) with respect to the Series 2005-1
Interest Period ending on the day preceding such Payment Date, the sum of (A) an amount
equal to the product of (1) the Class A-1 Note Rate for such Series 2005-1
Interest Period and (2) the Class A-1 Outstanding Principal Amount on
the first day of such Series 2005-1 Interest Period, after giving effect
to any principal payments made on such date, and (3) a fraction, the
numerator of which is the number of days in such Series 2005-1 Interest
Period and the denominator of which is 360, (B) an amount equal to
the product of (1) the Class A-2 Note Rate for such Series 2005-1
Interest Period and (2) the Class A-2 Outstanding Principal Amount on
the first day of such Series 2005-1 Interest Period, after giving effect
to any principal payments made on such date, and (3) a fraction, the
numerator of which is the number of days in such Series 2005-1 Interest
Period and the denominator of which is 360 (C) an amount equal to the
product of (1) one-twelfth of the Class A-3 Note Rate and (2) the
Class A-3 Outstanding Principal Amount on the first day of such Series 2005-1
Interest Period, after giving effect to any principal payments made on such
date, (D) an amount equal to the product of (1) the Class A-4
Note Rate for such Series 2005-1 Interest Period and (2) the Class A-4
Outstanding Principal Amount on the first day of such Series 2005-1
Interest Period, after giving effect to any principal payments made on such
date, and (3) a fraction, the numerator of which is the number of days in
such Series 2005-1 Interest Period and the denominator of which is 360,
and (E) an amount equal to the product of (1) one-twelfth of the Class A-5
Note Rate and (2) the


 


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Class A-5 Outstanding Principal Amount
on the first day of such Series 2005-1 Interest Period, after giving
effect to any principal payments made on such date, and (ii) an amount
equal to the amount of any unpaid Class A Deficiency Amounts as of the
preceding Payment Date (together with any accrued interest on such Class A
Deficiency Amounts at the applicable Series 2005-1 Note Rate).


 


“Series 2005-1 Class A Noteholder”
means each registered holder of a Class A-1 Note, Class A-2 Note, Class A-3
Note, Class A-4 Note or Class A-5 Note who, on the applicable Payment
Date, is entitled under the terms of such Class A-1 Note, Class A-2
Note, Class A-3 Note, Class A-4 Note or Class A-5 Note to
payment thereunder.


 


Capitalized terms used herein and not otherwise defined herein shall
have the respective meanings set forth in the Agreement as of the date of
execution of this Policy, without giving effect to any subsequent amendment to
or modification of the Agreement unless such amendment or modification has been
approved in writing by the Insurer.


 


Any notice hereunder or service of process on the Fiscal Agent may be
made at the address listed below for the Fiscal Agent or such other address as
the Insurer shall specify in writing to the Trustee.


 


The notice address of the Fiscal Agent is 15th Floor, 61
Broadway, New York, New York 10006 Attention: Municipal Registrar and Paying
Agency, or such other address as the Fiscal Agent shall specify to the Trustee
in writing.


 


This Policy is being issued under and pursuant to, and shall be
construed under, the laws of the State of New York, without giving effect to
the conflict of laws principles thereof.


 


The insurance provided by this Policy is not covered by the
Property/Casualty Insurance Security Fund specified in Article 76 of the
New York Insurance Law.


 


This Policy is not cancelable for any reason. The premium on this
Policy is not refundable for any reason including payment, or provision being
made for payment, prior to maturity of the Obligations.


 


No defenses, set-offs and counterclaims of any kind available to the
Insurer so as to deny payment of any amount due in respect of this Policy will
be valid and the Insurer hereby waives and agrees not to assert any and all
such defenses, set-offs and counterclaims so as to deny payment of any amount
due in respect of this Policy.


 


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IN WITNESS WHEREOF, the Insurer has caused this Policy to be executed
and attested this 21st day of December, 2005.


 


	
   

  	
  MBIA INSURANCE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Neil Y. Budnick

  
	
   

  	
  President

  
	
   

  	
   

  
	
  Attest:

  	
  /s/ Authorized Signatory

  
	
   

  	
   

  	
  Assistant Secretary

  



 


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