Exhibit 4.9.8


 


THIS AMENDED
AND RESTATED PARTICIPATION, PURCHASE AND SALE AGREEMENT (this “Agreement”)
is made as of this 21st day of December, 2005, by and among THE
HERTZ CORPORATION, a Delaware corporation (“Hertz”), individually and as
lessee and servicer, HERTZ GENERAL INTEREST LLC, a Delaware limited liability
company (“HGI”) and HERTZ VEHICLE FINANCING LLC, a Delaware limited
liability company (“HVF”). Except as otherwise specified, capitalized
terms used but not defined herein have the respective meanings set forth in
Schedule I to the Amended and Restated Base Indenture, dated as of
December 21, 2005, between HVF and the Trustee.


 


WHEREAS,
Hertz, HGI and HVF entered into a Participation, Purchase and Sale Agreement
made as of the 18th day of September, 2002, as amended pursuant to
Amendment No. 1 to Participation, Purchase and Sale Agreement dated as of March
31, 2004 (the “Prior Agreement”);


 


WHEREAS,
Hertz, HGI and HVF desire to amend and restate the Prior Agreement in its
entirety as set forth herein;


 


WHEREAS, Hertz
is engaged in the business of renting passenger automobiles and light-duty
trucks (“Vehicles”) to customers;


 


WHEREAS, Hertz
desires to arrange for HGI and HVF to finance and acquire Vehicles, and to
lease the Vehicles to Hertz from time to time pursuant to two separate lease
agreements (the “HGI Lease” and the “HVF Lease”, together the “Leases”);


 


WHEREAS, for
reasons of administrative convenience, the Servicer, on behalf of HGI, will
order Vehicles for purchase by HGI and for sale by HGI to HVF, and HVF will
purchase Vehicles ordered for it from HGI (HGI, in such capacity, a “Seller”,
and HVF, in such capacity, a “Purchaser”);


 


WHEREAS, for
reasons of administrative convenience, Vehicles purchased by HGI, including the
Vehicles subsequently sold to HVF, will be titled in the name of Hertz Vehicles
LLC, as nominee titleholder for HGI or HVF, as applicable, pursuant to the
Nominee Agreement;


 


WHEREAS, for
reasons of administrative convenience, the Collateral Agent will be named as
lienholder on the Certificates of Title for Vehicles purchased by HGI,
including the Vehicles subsequently sold by HGI to HVF, for the benefit of the
Secured Parties;


 


WHEREAS, from
time to time, the Lessee may desire to lease a particular Vehicle pursuant to
the HGI Lease rather than the HVF Lease, or vice versa, and in order to effect
such change HGI and HVF agree to purchase Vehicles from one another on the
terms set forth herein (each of HGI and HVF, in the capacity of seller, a “Seller,”
and in the capacity of purchaser, a “Purchaser”);


 

















 


WHEREAS, on
the date hereof, HGI agrees to transfer to HVF certain Manufacturer Receivables
held by it;


 


NOW,
THEREFORE, the parties agree as follows:


 


ARTICLE 1



AMOUNTS AND TERMS OF PURCHASES


 


SECTION 1.01. General. Each of HGI and
HVF agrees that, subject to the satisfaction of the conditions set forth in
Section 2.8 of its Lease, it will lease to the Lessee as many Vehicles as
the Lessee desires to lease, provided that HGI or HVF, as applicable, has
sufficient available funds to purchase such Vehicles in accordance with this
Agreement. The parties agree that, from time to time, the Lessee will notify
HGI, and HGI will notify the Servicer and HVF, in writing, that the Lessee
desires to lease Vehicles pursuant to the Leases. Upon the receipt of such
notice, the Servicer shall order the requested Vehicles in accordance with Section
1.02.


 


SECTION 1.02. Ordering Vehicles. HGI
hereby appoints Hertz, as Servicer, to act as HGI’s agent in placing vehicle
orders on behalf of HGI pursuant to the terms of the Manufacturer Programs with
respect to Program Vehicles and as otherwise agreed by the Servicer and a
dealer or buying representative with respect to Non-Program Vehicles. The
Servicer agrees that all Program Vehicles ordered as provided herein shall be
ordered utilizing the procedures consistent with the applicable Manufacturer
Program. The Servicer will be responsible for taking delivery of the Vehicles
and conducting pre-delivery inspection of Vehicles, filing claims on behalf of
HGI (or, in the case of Vehicles that have been purchased by HVF in accordance
with this Agreement prior to the delivery of such Vehicle, HVF) for damage in
transit and other Manufacturer delivery claims related to the Vehicles,
facilitating payment for Vehicles, titling Vehicles in accordance with the
Nominee Agreement and liening Vehicles in accordance with the Collateral Agency
Agreement, and performing other duties with respect to Vehicles. The Servicer
may arrange to have the Vehicles delivered to a location selected by the Lessee
at the Lessee’s expense to the extent that any such expense has not been
included in the Capitalized Cost of such Vehicle.


 


SECTION 1.03. Vehicle Payment and
Acceptance. (a)  In accordance with
the payment terms agreed to between HGI and each Manufacturer, authorized
dealer or other Person that sells a Vehicle to HGI, HGI shall pay to such party
the Capitalized Cost of such Vehicle. In accordance with the purchase terms
agreed to between HGI and each Manufacturer, title to such Vehicle shall pass
to HGI upon its payment for such Vehicle (or, in the case of a Vehicle
manufactured by Volvo, upon delivery of such Vehicle to HGI). The Lessee shall
pay all applicable costs and expenses of freight, packing, handling, storage,
shipment and delivery of such Vehicle and sales and use tax (if any) to the
extent that the same have not been included in the Capitalized Cost of such
Vehicle.


 


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(b) 
The Lessee agrees that payment by HGI for a Vehicle in accordance with
this Section 1.03 will constitute confirmation by the Lessee that it has
accepted such Vehicle, and that the conditions precedent to the lease of such
Vehicle under the HGI Lease have been satisfied, provided that the
Lessee will have the option to reject any such Vehicle that may be rejected
pursuant to the terms of the applicable Manufacturer Program with respect to
Program Vehicles, or in accordance with its customary business practices with
respect to Non-Program Vehicles.


 


SECTION 1.04. New Vehicle Notices. Within
seven Business Days of payment by HGI for each Vehicle (or, in the case of a
Vehicle manufactured by Volvo, within seven Business Days of the later of the
date of delivery and the date of invoice for such Vehicle), the Lessee will
determine whether it desires HGI to retain ownership of such Vehicle, or sell
it to HVF (each such Vehicle a “New Vehicle”, and each New Vehicle to be
purchased by HVF, a “New HVF Vehicle”). Upon making its determination
with respect to each New Vehicle, the Lessee shall then give notice of such
determination to the Servicer and the Servicer shall deliver a notice to HGI,
HVF, the Nominee, the Collateral Agent and, in respect of each New HVF Vehicle,
the Trustee, setting forth the information listed in Exhibit A hereto with
respect to such New Vehicle (each such notice a “New Vehicle Schedule”),
including, if applicable, the proposed effective date of the transfer of such
New HVF Vehicle to HVF.


 


SECTION 1.05. New HVF Vehicle Payment and
Acceptance. (a)  On the proposed
effective date of the sale and transfer of any New HVF Vehicle to HVF set forth
in the New Vehicle Schedule delivered pursuant to Section 1.04, HVF
shall, subject to the satisfaction of the conditions set forth in Section 2.02,
pay to HGI an amount equal to the Capitalized Cost of such New HVF Vehicle. HVF
shall make payments in immediately available funds to or at the direction of
HGI.


 


(b) 
Hertz, HGI and HVF hereby agree that title to each New HVF Vehicle shall
pass to HVF upon satisfaction of the conditions set forth in Section 2.02
in respect of such New HVF Vehicle. The Lessee agrees that payment of the
purchase price for a New HVF Vehicle by HVF under this Section 1.05 will
constitute confirmation by the Lessee that it has accepted such New HVF
Vehicle, and that the conditions precedent to the lease of such New HVF
Vehicle, under the HVF Lease have been satisfied, provided that the Lessee will
have the option to reject any such New HVF Vehicle that may be rejected pursuant
to the terms of the applicable Manufacturer Program with respect to Program
Vehicles, or in accordance with its customary business practices with respect
to Non-Program Vehicles. If the Lessee rejects a New HVF Vehicle after payment
for such New HVF Vehicle has been made by HVF, HGI shall repurchase such New
HVF Vehicle within five Business Days of such rejection for an amount equal to
the Capitalized Cost of such New HVF Vehicle (a “Rejected Vehicle Payment”).
If the Lessee rejects a New HVF Vehicle after payment for such New HVF Vehicle
has been made, the Lessee shall give notice of such rejection to the Servicer
and the Servicer shall then deliver a notice to HGI, HVF, the Nominee, the
Collateral Agent and the Trustee setting forth the information listed in Exhibit
B with respect to such rejected New HVF Vehicle (each such notice a “Rejected
Vehicle Schedule”, and each such New HVF Vehicle, a “Rejected Vehicle”),
including the proposed effective date of the repurchase by HGI. HVF and HGI
hereby agree that title to 


 


3

















 


a Rejected Vehicle shall pass to HGI upon payment to HVF of the related
Rejected Vehicle Payment. If HGI fails to make the Rejected Vehicle Payment
with respect to a Rejected Vehicle to HVF within five Business Days of the
rejection by the Lessee of such Vehicle, the Servicer shall immediately make
the Rejected Vehicle Payment to HVF on behalf of HGI.


 


(c) 
HGI hereby assigns to HVF, with respect to any New HVF Vehicle that HVF
purchases from HGI in accordance with this Section 1.05, all rights that
HGI has against the Manufacturer of such New HVF Vehicle. This clause (c) shall
apply to any New HVF Vehicle whether or not it has been delivered to the Lessee
at the time of its sale to HVF.


 


(d)  HGI
agrees that it will pay to HVF any Invoice Adjustments paid or payable to HGI
by a Manufacturer in respect of a New HVF Vehicle. HVF agrees that it will pay
to HGI any Invoice Adjustments paid or payable by HGI to a Manufacturer in
respect of a New HVF Vehicle. Invoice Adjustments will be payable by HGI to HVF
within 5 Business Days after notification from a Manufacturer to HGI that
Invoice Adjustments are payable by such Manufacturer to HGI in respect of a New
HVF Vehicle. Invoice Adjustments will be payable by HVF to HGI within 5
Business Days of notification from HGI to HVF that a Manufacturer has notified
HGI that Invoice Adjustments are payable to such Manufacturer by HGI. “Invoice
Adjustments” means payments from or to a Manufacturer representing the
difference between the estimated Capitalized Cost of a Vehicle as reflected on
its invoice, and the actual Capitalized Cost of such Vehicle.


 


SECTION 1.06. Vehicle and Manufacturer
Receivable Transfers. (a)  From time
to time, the Lessee may desire to lease a particular Vehicle pursuant to the
HVF Lease rather than the HGI Lease, or vice versa. The parties hereto agree
that the Lessee may effect such a change with respect to a particular Vehicle
by delivering a notice to HVF, HGI, the Nominee, the Servicer, the Collateral
Agent and the Trustee setting forth the information listed in Exhibit C
with respect to such Vehicle (each such notice a “Transferred Vehicle
Schedule”), including the proposed effective date of the transfer of such
Vehicle; provided, however, that the Lessee may not cause HVF to
sell to HGI a Non-Program Vehicle for a Transfer Price that is less than the
Termination Value of such Vehicle immediately prior to the transfer thereof. This
Section 1.06 does not apply to the initial treatment of New Vehicles
under Section 1.04.


 


(b)  On
the date hereof (but not thereafter) HGI may also transfer certain existing
Manufacturer Receivables to HVF.


 


SECTION 1.07. Transferred Vehicle and
Manufacturer Receivable Payments. On the proposed effective date of the
transfer of any Vehicle or any Manufacturer Receivable pursuant to Section
1.06, subject to the satisfaction of the conditions set forth in Section
2.02, the applicable Purchaser shall pay to the applicable Seller the
Reasonably Equivalent Value of such Vehicle or, in the case of a Manufacturer
Receivable, the amount of such Manufacturer Receivable (in each case, the “Transfer
Price”). “Reasonably Equivalent Value” means (i) with respect to a Vehicle
that is subject to a Manufacturer Program that provides that such Vehicle must
be resold to the applicable Manufacturer, the Termination Value of such
Vehicle, (ii) with respect to any other Vehicle that is subject to a 


 


4

















 


Manufacturer Program, the greater of the Market Value of such Vehicle
and the Termination Value of such Vehicle immediately prior to the transfer
thereof and (iii) with respect to any other Vehicle, the Market Value for such
Vehicle. The applicable Seller and the applicable Purchaser hereby agree that
title to each Vehicle transferred pursuant to Section 1.06 shall pass to
the applicable Purchaser upon satisfaction of the conditions set forth in Section
2.02 in respect of such Vehicle. All payments to HVF hereunder shall be
deposited into the Collection Account.


 


SECTION 1.08. Hertz as Servicer. Each
of HGI and HVF hereby appoints Hertz as Servicer to be responsible for ordering
and receiving Vehicles pursuant to Section 1.02, and all administrative
details relating to Vehicle transfers under Sections 1.04 through 1.07,
including transfer of funds, the preparation of documentation, the calculation
of purchase price amounts, and the provision of information under this
Agreement. The Servicer shall be responsible for ensuring that all information
included in New Vehicle Schedules, Rejected Vehicle Schedules and Transferred
Vehicle Schedules is true and correct. HGI and HVF will cooperate, at the
Servicer’s expense, with the Servicer’s performance in accordance with the
terms of this Section 1.08.


 


SECTION 1.09. Chrysler Vehicles. If
the Lessee leases Program Vehicles subject to a Guaranteed Depreciation Program
with DaimlerChrysler Motors Corporation or one of its affiliates (“Chrysler
Vehicles”) under the Leases, the Lessee agrees that all such Chrysler
Vehicles will be owned by HGI and leased under the HGI Lease or owned by HVF
and leased under the HVF Lease. This Section 1.09 does not apply to the
initial treatment of Chrysler Vehicles that are New HVF Vehicles and that are
purchased from HGI by HVF in accordance with Section 1.05.


 


SECTION 1.10. Hertz as Lessee. Hertz,
as Lessee, agrees that upon a transfer of a Vehicle from the HGI Lease to the
HVF Lease or vice versa pursuant to this Agreement, Hertz relinquishes all
rights that it has in such Vehicle pursuant to the Lease under which such
Vehicle was leased prior to such transfer.


 


ARTICLE 2



CONDITIONS OF PURCHASES


 


SECTION 2.01. Conditions Precedent to the
Obligations of HVF, HGI and Hertz. The obligations of HVF, HGI, the Lessee
and the Servicer hereunder are subject to the satisfaction of each of the
following conditions:


 


(a) 
This Agreement has been duly authorized by each of HVF, HGI and Hertz,
and all necessary corporate action has been taken and all necessary
governmental approvals, if any, have been obtained with respect to this
Agreement by each of HVF, HGI and Hertz;


 


(b) 
the Leases have been duly authorized by each of the parties thereto, and
all necessary corporate action has been taken and all necessary governmental
approvals, if any, have been obtained with respect to the Leases by each of the
parties thereto; and


 


5

















 


(c) 
the Nominee Agreement has been duly authorized by each of the parties
thereto, and all necessary corporate action has been taken and all necessary
governmental approvals, if any, with respect to the Nominee Agreement have been
obtained by each of the parties thereto.


 


SECTION 2.02. Conditions Precedent to Each
Purchase. Each purchase of a New HVF Vehicle or Transferred Vehicle
hereunder (each, a “Purchase”) shall be subject to the further
conditions precedent that:


 


(a)  on
the date of such Purchase and after giving effect to such Purchase, the
following statements shall be true (and the Purchaser, by making payment for
such New HVF Vehicle or such Transferred Vehicle, and the Seller, by accepting
such payment, shall be deemed to have certified that):


 


(i) 
the representations and warranties contained in Sections 3.01 and
3.02 are correct on and as of the date of such Purchase as though made
on and as of such date;


 


(ii) 
no event has occurred and is continuing, or would result from such
Purchase, that constitutes an Event of Termination (as such term is defined in Section
6.01);


 


(iii) 
the Purchase is allowed under the Related Documents;


 


(iv) 
the Purchaser shall have paid the Capitalized Cost of such New HVF
Vehicle or Transfer Price of such Transferred Vehicle;


 


(v) 
the Vehicle being purchased is a HGI Eligible Vehicle or an Eligible
Vehicle;


 


(vi) 
the conditions to leasing such Vehicle under Section 2.8 of the
applicable Lease shall have been satisfied; and


 


(vii) 
in the case of a New HVF Vehicle financed under a dealer’s floor plan
line of credit provided by Ford Motor Credit Company (“FMCC”) or General
Motors Acceptance Corporation (“GMAC”), HGI shall have paid the
Capitalized Cost of such Vehicle to FMCC or GMAC, as applicable, and any
interest of FMCC or GMAC, as applicable, in such New HVF Vehicle shall have
been terminated; and


 


(b) 
the Purchaser and the Seller shall have received such other approvals,
opinions or documents as the Purchaser or the Seller, as applicable, may
reasonably request.


 


The Servicer,
by arranging the transfer from HVF to HGI of the Capitalized Cost of any New
HVF Vehicle financed under a dealers’s floor plan line of credit provided by
FMCC or GMAC pursuant to Section 1.05(a), shall be deemed to have represented
that HGI has paid the Capitalized Cost of such New HVF Vehicle to FMCC or GMAC,
as applicable, and that any interest of FMCC or GMAC, as applicable, in such
New HVF Vehicle has been terminated.


 


6

















 


ARTICLE 3



REPRESENTATIONS AND WARRANTIES


 


SECTION 3.01. Representations of HGI and
HVF. As of the date hereof and the date of each Vehicle transfer pursuant
to Section 1.04 or 1.06, each of HGI and HVF represents and
warrants as follows:


 


(a)  It
(i) is a limited liability company duly formed, validly existing and in good
standing under the laws of Delaware, (ii) is duly qualified to do business as a
foreign limited liability company and is in good standing under the laws of
each jurisdiction where the character of its property, the nature of its
business or the performance of its obligations under the Related Documents make
such qualification necessary, except to the extent that the failure to so
qualify is not reasonably likely to result in a Material Adverse Effect, and
(iii) has all power and authority and all governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted and as presently proposed to be conducted and for the purposes of the
transactions contemplated by this Agreement and the other Related Documents.


 


(b)  It
has all requisite power and authority to execute, deliver and perform this
Agreement and to carry out the provisions hereof. Its execution, delivery and
performance of this Agreement have been duly authorized by all necessary action
on its part and requires no action by or in respect of, or filing with, any
Governmental Authority which has not been obtained.


 


(c) 
This Agreement has been duly executed and delivered by it and
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with the Agreement’s terms, except as the same may be limited by (i)
applicable bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors rights and (ii) general principles of equity.


 


(d) 
There is no action, suit, investigation or proceeding pending or, to its
knowledge, threatened against it before any court or arbitrator or Governmental
Authority that would materially adversely effect its financial condition,
business, assets or operations or which in any manner draws into question the
validity or enforceability of this Agreement or any other Related Document or
its ability to perform its obligations under the Related Documents.


 


(e) 
The execution, delivery and performance by it of this Agreement does not
contravene, or constitute a default under, any Requirement of Law with respect
to it or any Contractual Obligation with respect to it or result in the
creation or imposition of any Lien on any property of it (except for Permitted
Liens).


 


(f) 
Sales made pursuant to this Agreement are intended to constitute valid
sales of New HVF Vehicles and Transferred Vehicles to the applicable Purchaser
and immediately upon transfer hereunder the applicable Purchaser shall have
good title thereto, enforceable against creditors of, and purchasers from, the
applicable Seller. Neither Seller shall have 


 


7

















 


any remaining property interest in a New HVF Vehicle or Transferred
Vehicle sold to a Purchaser.


 


(g) 
Immediately prior to each transfer of a New HVF Vehicle or Transferred
Vehicle to the Purchaser hereunder, the applicable Seller had title to such New
HVF Vehicle or Transferred Vehicle free and clear of all Liens and rights of
others, except Permitted Liens.


 


(h) 
Each sale of a New HVF Vehicle or Transferred Vehicle by a Seller to a
Purchaser pursuant to this Agreement, and all other transactions between such
Seller and such Purchaser, will be made in good faith and without intent to
hinder, delay or defraud creditors of such Seller or Purchaser.


 


(i)  It
has not established and does not maintain or contribute to any Pension Plan
that is covered by Title IV of ERISA.


 


(j)  It
has filed all federal, state and local tax returns and all other tax returns
which, to its knowledge, are required to be filed (whether informational
returns or not), and has paid all taxes due, if any, pursuant to said returns
or pursuant to any assessment received by it, except such taxes, if any, as are
being contested in good faith and for which adequate reserves have been set
aside on its books. It has paid all fees and expenses required to be paid by it
in connection with the conduct of its business, the maintenance of its
existence and its qualification as a foreign limited liability company
authorized to do business in each state in which it is required to so qualify,
except to the extent that the failure to pay such fees and expenses is not
reasonably likely to result in a Material Adverse Effect.


 


(k)  It
is not, and is not controlled by an “investment company” within the meaning of,
and is not required to register as an “investment company” under, the
Investment Company Act.


 


(l) 
Both before and after giving effect to each Purchase by HVF or HGI, as
applicable, it is solvent within the meaning of the Bankruptcy Code and is not
the subject of any voluntary or involuntary case or proceeding seeking
liquidation, reorganization or other relief with respect to itself or its debts
under any bankruptcy or insolvency law and no Event of Bankruptcy has occurred
with respect to it.


 


(m) 
All of its issued and outstanding limited liability company interests
are owned by Hertz, all of which limited liability company interests have been
validly issued, are fully paid and non-assessable and are owned of record by
Hertz. In the case of HVF, it has no subsidiaries and owns no capital stock of,
or other equity interest in, any other Person, other than Hertz Vehicles LLC.


 


(n)  In
the case of HVF, (x) other than the HVF Credit Facility, the Related Documents
or any agreement entered into in connection with the issuance of any Series of
Notes pursuant to the Base Indenture, it is not a party to any contract or
agreement of any kind or nature and (y) it is not subject to any obligations or
liabilities of any kind or nature in favor of any third party, including,
without limitation, Contingent Obligations. In the case of HVF, it has not
engaged in any activities since its formation (other than those 


 


8

















 


incidental to its formation, the execution of the Related Documents to
which it is a party and the performance of the activities referred to in or
contemplated by such agreements).


 


(o)  It
is not (i) in violation of the HGI LLC Agreement or HVF LLC Agreement, as
applicable, (ii) in violation of any Requirement of Law or (iii) in
violation of any Contractual Obligation.


 


SECTION 3.02. Representations of Hertz.
As of the date hereof and the date of each Vehicle transfer pursuant to Section 1.04
or 1.06, Hertz represents and warrants as follows:


 


(a)  It
has been duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of Delaware, with corporate power under
the laws of such state to execute and deliver this Agreement and the other
Related Documents to which it is a party and to perform its obligations
hereunder and thereunder, and is duly qualified and in good standing to do
business as a foreign corporation in each jurisdiction where the character of
its properties or the nature of its business makes such qualification necessary
and where the failure to do so would have a Material Adverse Effect.


 


(b) 
This Agreement has been duly authorized, executed and delivered on its
behalf and, assuming due authorization, execution and delivery by the other
parties thereto, this Agreement is a valid and legally binding agreement of
Hertz.


 


(c) 
There are is no consent, approval, authorization, order, registration or
qualification of or with any Governmental Authority having jurisdiction over it
which is required for the execution, delivery and performance of this Agreement
(except to the extent that the failure to obtain such consent, approval,
authorization, order, registration or qualification is not reasonably likely to
result in a Material Adverse Effect).


 


(d) 
There are no actions, suits, investigations or proceedings pending or,
to its knowledge after reasonable inquiry, threatened against it before any
Governmental Authority which question the validity or enforceability of this
Agreement or any action taken or to be taken pursuant hereto, or which, if
adversely determined, are reasonably likely to materially impair its ability to
perform its obligations under this Agreement.


 


(e) 
Neither it nor any of its properties or assets are subject to any
contract or agreement, any provision of its certificate of incorporation or
by-laws or other restriction, any law, rule, ruling, regulation or judgment of
any country, state, territory or political subdivision thereof or Governmental
Authority which would have a material adverse effect on its ability to perform
its obligations under this Agreement.


 


(f) 
Its execution, delivery and performance of this Agreement will not
conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any of its property or assets pursuant to the
terms of any indenture, mortgage, deed of trust, loan agreement, guarantee,
lease financing agreement or other similar agreement or instrument under which
it is a debtor or guarantor (except to the extent that such conflict, breach,
creation or imposition is not reasonably likely to result in a Material Adverse
Effect) nor 


 


9

















 


will such action result in a violation of any provision of applicable
law or regulation (except to the extent that such violation is not reasonably
likely to result in a Material Adverse Effect) or of the provisions of its
certificate of incorporation or by-laws.


 


ARTICLE 4



COVENANTS


 


SECTION 4.01. Covenants of the Parties.


 


(a)  Compliance
with Laws, etc.. Each of HGI, HVF and Hertz will comply in all material
respects with all Requirements of Law and all applicable laws, rules,
regulations and requirements of Governmental Authorities except where the
necessity of compliance therewith is contested in good faith by appropriate
proceedings and where such noncompliance would not materially and adversely
affect its business, financial condition, operations or properties or its
ability to perform its obligations under the Related Documents to which it is a
party.


 


(b)  Notice
of Proceedings. Promptly upon becoming aware thereof, each of HGI, HVF and
Hertz agrees to give the other parties to this Agreement, the Trustee and the
Collateral Agent written notice of the commencement or existence of any
proceeding by or before any Governmental Authority against or affecting it
which is reasonably likely to have a material adverse effect on its financial
condition, business, assets or operations or its ability to perform its
obligations under the Related Documents to which it is a party.


 


(c)  Further
Assurances. Each of HGI, HVF and Hertz agrees from time to time, at its
expense, promptly to execute and deliver all further instruments and documents,
and to take all further reasonable actions (other than re-titling Vehicles to
reflect a titleholder other than the Nominee) that may be reasonably necessary
or desirable, or that a Purchaser or its assignee may reasonably request, to
perfect, protect, or more fully evidence the sale of New HVF Vehicles and
Transferred Vehicles under this Agreement, or to enable a party to this
Agreement or its assignee to exercise and enforce its respective rights and
remedies under this Agreement.


 


(d)  Separate
Conduct of Business.


 


(i) 
Each of HVF and Hertz agree that HVF will:  (i) at all times maintain at least one
Independent Director; (ii) to the extent that it will require an office to
conduct its business, conduct its business from an office separate from that of
Hertz or any of Hertz’s other Affiliates; (iii) maintain separate corporate
records and books of account from those of Hertz or any of Hertz’s other
Affiliates; (iv) ensure that all substantive communications, including without
limitation, letters, invoices, purchase orders, contracts, statements and
applications, will be made solely in its own name; (v) not hold itself out as
having agreed to pay, or as being liable for, the obligations of Hertz or any
of Hertz’s other Affiliates ; (vi) continuously maintain as official records
the resolutions, agreements and other instruments underlying the transactions
contemplated by this Agreement; (vii) not engage 


 


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in any transaction with Hertz or any of Hertz’s other Affiliates except
as contemplated by this Agreement or the other Related Documents or as
permitted by this Agreement or the other Related Documents; and (viii) prepare
its annual financial statements in a manner that is wholly consistent with the
conclusion that the assets of Hertz or any of Hertz’s other Affiliates are not
available to pay its creditors.


 


(ii) 
Hertz agrees that it will (i) conduct its business from an office
separate from that of HVF, should HVF require an office to conduct its
business; (ii) maintain separate corporate records and books of account from
those of HVF; (iii) ensure that all substantive communications, including
without limitation, letters, invoices, purchase orders, contracts, statements
and applications, will be made solely in its own name, except as contemplated
in this Agreement or the Related Documents or as permitted by this Agreement or
the other Related Documents; (iv) not hold itself out as having agreed to pay,
or as being liable for, the obligations of HVF; (v) continuously maintain as
official records the resolutions, agreements and other instruments underlying
the transactions contemplated by this Agreement; (vi) not engage in any
transaction with HVF except as contemplated by this Agreement or the other
Related Documents or as permitted by this Agreement or the other Related
Documents; and (vii) prepare its annual financial statements in accordance with
GAAP.


 


(e)  Maintenance
of Separate Existence. Each of HGI and HVF acknowledges its receipt of a
copy of that certain opinion letter issued by Cravath, Swaine & Moore dated
September 18, 2002 addressing the issue of substantive consolidation as it may
relate to each of Hertz, HFF, Hertz Vehicles LLC and HVF. HGI and HVF hereby
agree to maintain in place all policies and procedures in all material
respects, and take and continue to take all action, described in the factual
assumptions set forth in such opinion letter and relating to such Person,
except as may be confirmed as not required in a subsequent or supplemental
opinion of Cravath, Swaine & Moore addressing the issue of substantive
consolidation as it may relate to each of Hertz, Hertz Vehicles LLC, HVF and
HFF.


 


(f)  Notice
of Event of Termination. Each of HGI, HVF and Hertz agrees that promptly
upon becoming aware of any Event of Termination or any event which, with the
giving of notice, the passage of time or both, would constitute an Event of
Termination, it will furnish notice of such Event of Termination to the
Trustee, the Collateral Agent, and each of the other parties to this Agreement.


 


(g)  New
Vehicle Schedules, Rejected Vehicle Schedules and Transferred Vehicle Schedules.
Hertz, as Servicer, shall deliver New Vehicle Schedules, Rejected Vehicle
Schedules and Transferred Vehicle Schedules to HGI, HVF, the Nominee, the
Collateral Agent and the Trustee in accordance with Sections 1.04 and 1.06,
and the information contained in such New Vehicle Schedules, Rejected Vehicle
Schedules and Transferred Vehicle Schedules shall be correct in all material
respects at the time of their delivery.


 


(h)  Titling
and Liening of Vehicles. Hertz, as Servicer, shall, subject to the terms of
the Nominee Agreement, title each Vehicle in the name of the Nominee, unless
and until it is directed to do otherwise in accordance with the Nominee Agreement.
Hertz, as Servicer, shall, subject to the terms of the Collateral Agency
Agreement, note the lien of 


 


11

















 


the Collateral Agent on the Certificate of Title of each Vehicle,
unless and until it is directed to do otherwise in accordance with the
Collateral Agency Agreement.


 


(i) 
HGI further agrees that:


 


(i)  Payment of Obligations.
It will pay and discharge, at or before maturity, all of its respective
material obligations and liabilities, including, without limitation, tax
liabilities and other governmental claims, except where the same may be
contested in good faith by appropriate proceedings, and will maintain, in
accordance with GAAP, reserves as appropriate for the accrual of any of the
same.


 


(ii)  Conduct of Business and
Maintenance of Existence. It will maintain its existence as a limited
liability company, validly existing and in good standing under the laws of the
State of Delaware and duly qualified as a foreign limited liability company licensed
under the laws of each state in which the failure to so qualify would have a
material adverse effect on its business, financial condition, results of
operations or properties or its ability to perform its obligations under the
Related Documents to which it is a party or which qualification shall be
necessary to protect the validity and enforceability of this Agreement.


 


(iii)  Books and Records. It
will keep proper books of record and account in which full, true and correct
entries shall be made of all its dealings and transactions, business and
activities in accordance with GAAP.


 


(iv)  No ERISA Plan. It
will not establish or maintain or contribute to any Pension Plan that is
covered by Title IV of ERISA.


 


(v)  Mergers. It will not
merge or consolidate with or into any other Person.


 


(vi)  Dividends, Officers’
Compensation, etc. It will not declare or pay any distributions on any of
its limited liability company interests except to the extent permitted under
Section 18-607 of the Delaware Limited Liability Company Act.


 


(vii)  Amendments to HGI LLC
Agreement. It will not amend the HGI LLC Agreement or its certificate of
formation unless, prior to such amendment, the Rating Agency Condition with
respect to each Series of Notes Outstanding shall have been satisfied with
respect to such amendment.


 


ARTICLE 5



SERVICER; MASTER EXCHANGE AGREEMENT


 


SECTION 5.01. Hertz Acting as Servicer.
The parties to this Agreement acknowledge and agree that Hertz has agreed to
act on behalf of each of HGI and HVF as Servicer pursuant to the Leases, and,
as Servicer, has agreed to perform certain duties of each of HGI and HVF under
this Agreement and the other Related Documents.


 


12

















 


SECTION 5.02. Master
Exchange Agreement. The parties to this Agreement acknowledge and agree
that any action to be taken by HVF or HGI pursuant to this Agreement
(including, but not limited to, the payment or receipt of any amounts) may be
taken by the Intermediary to the extent provided for in the Master Exchange
Agreement. Servicer agrees, to the extent requested by HGI or HVF, to cooperate
with HVF or HGI, as applicable, in effecting any such actions pursuant to, and
in accordance with, the terms of the Master Exchange Agreement.


 


ARTICLE 6



EVENTS OF TERMINATION


 


SECTION 6.01. Events of Termination. If
any of the following events (each an “Event of Termination”) shall occur
and be continuing:


 


(a)  A
Purchaser shall fail to make any payment required under Section 1.05 or 1.07
for five Business Days; or


 


(b) 
Any representation or warranty made by Hertz, HGI or HVF under this
Agreement or any written information or report (including, without limitation,
any New Vehicle Schedule, Rejected Vehicle Schedule or Transferred Vehicle
Schedule) delivered by the Servicer pursuant to this Agreement shall prove to
have been incorrect or untrue in any material respect when made or delivered
and such condition, to the extent it is capable of being remedied, shall remain
unremedied for 10 days; or


 


(c) 
Hertz, HGI or HVF shall fail to perform or observe in any material
respect any other term, covenant or agreement contained in this Agreement on
its part to be performed or observed and any such failure shall remain
unremedied for 10 days after the earlier of the date that written notice
thereof shall have been given to Hertz, HGI, HVF, the Trustee or the Collateral
Agent, and the date that Hertz, HGI or HVF has actual knowledge thereof; or


 


(d)  A
Liquidation Event of Default occurs; or


 


(e) 
Any purchase of New HVF Vehicles, Rejected Vehicles or Transferred
Vehicles hereunder shall for any reason cease to transfer valid ownership of
such New HVF Vehicles, Rejected Vehicles or Transferred Vehicles to the
Purchaser thereof free and clear of any Lien other than Permitted Liens; or


 


(f)  An
Event of Bankruptcy occurs with respect to Hertz or a Seller; or


 


(g)  A
Servicer Default occurs; or


 


(h)  An
Amortization Event with respect to each Series of Notes Outstanding occurs.


 


13

















 


then, and in
any such event, each of HGI and HVF will no longer be obligated to buy or sell
Vehicles under this Agreement.


 


ARTICLE 7



INDEMNIFICATION


 


SECTION 7.01. Indemnification. The
parties agree that the arrangements set forth in this Agreement are covered by
the Indemnification Agreement. In addition, (a) Hertz hereby indemnifies and
holds harmless HGI, HVF, the Trustee and the Collateral Agent for any or all
damages, claims, demands, losses, liabilities and related costs or expenses (“Losses”)
arising out of or resulting from (including reasonable costs of investigation
and attorney’s fees and expenses) (i) any actions or failures to act in
connection with this Agreement, including providing notices pursuant to Sections
1.04 and 1.06, ordering Vehicles pursuant to Section 1.02,
and facilitating payment for Vehicles pursuant to Sections 1.03, 1.05
and 1.07 or (ii) the failure of any representation or warranty or
statement made by Hertz (or any of its officers) under or in connection with
this Agreement or in any certificate, report, schedule or notice delivered
pursuant hereto to be true and correct when made or deemed made; and (b) HGI
hereby indemnifies and holds harmless HVF for any and all Losses arising out of
or resulting from (including reasonable costs of negotiation and attorney’s
fees and expenses) any actions of a Qualified Intermediary on behalf of HGI in
connection with the Master Exchange Agreement. The provisions of this indemnity
shall run directly to, and be enforceable by, an injured party and shall
survive the termination of this Agreement.


 


ARTICLE 8



MISCELLANEOUS


 


SECTION 8.01. No Third Party Beneficiaries.
This Agreement will not confer any rights or remedies upon any Person other
than the parties hereto, the Trustee, the Collateral Agent and their respective
successors and permitted assigns.


 


SECTION 8.02. Entire Agreement. This
Agreement and the other agreements specifically referenced herein constitute
the entire agreement among the parties hereto and supersede any prior understandings,
agreements, or representations by or among the parties hereto, written or oral,
to the extent they related in any way to the subject matter hereof.


 


SECTION 8.03. Succession and Assignment. This
Agreement will be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns. Under the Indenture, HVF
will assign its rights under this Agreement to the Trustee (for the benefit of
the holders of the Notes); the parties hereto may not otherwise assign either
this Agreement or any of their respective rights, interest, or obligations
hereunder without the prior written approval of the other parties and the 


 


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satisfaction of the Rating Agency Condition with respect to each Series
of Notes Outstanding.


 


SECTION 8.04. Counterparts. This
Agreement may be executed in separate counterparts, each of which will be
deemed an original but all of which together will constitute one and the same
instrument.


 


SECTION 8.05. Headings. The section
headings contained in this Agreement are inserted for convenience only and will
not affect in any way the meaning or interpretation of this Agreement.


 


SECTION 8.06. Notices. All notices,
requests, demands, claims and other communications hereunder will be in writing.
Any notice, request demand, claim, or other communication hereunder will be
deemed duly given if (and then two Business Days after) it is sent by
registered or certified mail, return receipt requested, postage prepaid, and
addressed to the intended recipient as set forth below:


 


If to Hertz,
HGI or HVF:

225 Brae Boulevard

Park Ridge, NJ 07656

Attention:  Treasury Department

Telephone no. (201) 307-2000

Facsimile no. (201) 307-2746


 


If to the
Trustee:


 


BNY Midwest Trust
Company

2 North LaSalle Street, Suite 1020

Chicago, IL  60602

Attention:  Corporate Trust
Administration — Structured Finance

Telephone no. (312) 827-8569

Facsimile no. (312) 827-8562


 


If to the
Collateral Agent:


 


BNY Midwest
Trust Company

2 North LaSalle Street, Suite 1020

Chicago, IL  60602

Attention:   Corporate Trust
Administration — Structured Finance

Telephone no. (312) 827-8569

Facsimile no. (312) 827-8562


 


Any party
hereto may give any notice, request, demand, claim, or other communication
hereunder using any other means (including personal delivery, expedited
courier, messenger service, telecopy, telex, ordinary mail, or electronic
mail), but no such notice, request, demand, claim, or other communication will
be deemed to have been duly given unless and until it actually is received by
the intended recipient. Any party hereto may change the address to which
notices, requests, demands, claims and other 


 


15

















 


communications hereunder are to
be delivered by giving the other parties notice in the manner herein as set
forth.


 


SECTION 8.07. Governing Law. THIS
AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC
LAWS OF THE STATE OF NEW YORK.


 


SECTION 8.08. Amendments and Waivers. No
amendment of any provision of this Agreement will be valid unless the same will
be in writing and signed by each of the parties hereto and the Rating Agency
Condition with respect to each Series of Notes Outstanding shall have been
satisfied with respect thereto. No waiver by any party hereto of any default,
misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, will be deemed to extend to any prior or subsequent
default, misrepresentation, or breach of warranty or covenant hereunder or
affect in any way any rights arising by virtue of any prior or subsequent such
occurrence.


 


SECTION 8.09. Severability. Any term
or provision of this Agreement that is invalid or unenforceable in any
situation in any jurisdiction will not affect the validity or enforceability of
the remaining terms and provisions hereof or the validity or enforceability of
the offending term or provision in any other situation or in any other
jurisdiction.


 


SECTION 8.10. Construction. The
language used in this Agreement will be deemed to be the language chosen by the
parties hereto to express their mutual intent, and no rule of strict
construction will be applied against any party.


 


SECTION 8.11. Nonpetition Covenants. Each
of HVF, HGI and Hertz hereby covenants and agrees that, prior to the date which
is one year and one day after the payment in full of all of the Notes, it will
not institute against, or join any other Person in instituting against, HVF,
HGI or the Intermediary any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings or other similar proceeding under the laws of the
United States or any state of the United States. The provisions of this Section 8.11
shall survive the termination of this Agreement.


 


SECTION 8.12. Fee. As compensation for
the services rendered by HGI to HVF pursuant to this Agreement, HVF shall pay
to HGI a fee of $5,000 per month which shall be payable on the Payment Date.


 


16

















 


IN WITNESS
WHEREOF, the parties hereto have duly executed this Agreement as of the date
first above written.


 


	
   

  	
  THE HERTZ CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Robert
  H. Rillings

  
	
   

  	
  Name:

  	
  Robert H.
  Rillings

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HERTZ GENERAL INTEREST LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Robert
  H. Rillings

  
	
   

  	
  Name:

  	
  Robert H.
  Rillings

  
	
   

  	
  Title:

  	
  Vice
  President & Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HERTZ VEHICLE FINANCING LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Robert
  H. Rillings

  
	
   

  	
  Name:

  	
  Robert H.
  Rillings

  
	
   

  	
  Title:

  	
  Vice
  President & Treasurer

  
					



 


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